Washington: You Can Still Save The Wealth Tax

Taxing the rich is not a lost cause, Bob Ferguson is

Governor Bob Ferguson is still not satisfied with the Democrats' revenue proposal even after they rolled over to his veto threat and cast aside what would have been the crown jewel of the session, the wealth tax. His stubborness may force the legislature to duke it out in a special session.

"Ferguson is not negotiating in good faith," Mike Yestramski, the president of the Washington Federation of State Employees (WFSE), told The Burner.  "In labor terms, if he was at the bargaining table with the legislature, I would have filed a fucking unfair labor practice against him at this point."

To Yestramski, it's Ferguson that's the lost cause, not taxing the rich. Advocates do not accept the assertion that Washington’s wealth tax proposal is dead. And they don’t think you should either. 

“Despite what big business and the Seattle Times wants us to think, the wealth tax is NTIB,” said Alexis Mansanarez, the communications director at the Economic Opprotunity Institute. 

NTIB is Oly language for “Necessary to implement the budget." In procedural terms, that means it's not subject to the session deadline. But in political terms? It that means, we're not fucking giving up.

“It's still very much in play,” Mansanarez said in a phone call with The Burner. “And people need to continue urging their lawmakers to pass it.” 

Earlier this month, control freak Ferguson threatened to veto lawmakers’ large, budget-making-or-breaking wealth tax. This came after a historically intense lobbying effort from big business, chiefly Microsoft, which pledged a million dollars to a PAC dedicated to fighting a wealth tax.

As Washington Budget and Policy Center Executive Director Eli Goss said, “Our governor is more willing to bend to corporate interests than to protect and serve low and middle income families. That puts the legislature in a really difficult position.”

This week, Democrats gave in and unveiled a brand new revenue package, this time without their former star player, a multi-billion dollar, first-of-its-kind wealth tax and a statewide payroll tax. Instead, the new proposal features an additional tier for the capital gains tax, a business & occupation (B&O) tax surcharge targeting large corporations, a new 3% cap on annual increases in state and local property taxes, and a sales tax hike on nicotine products and select services. In all, the package raises $11.8 billion of the $16 billion deficit, leaving $4 billion worth of cuts, or a wealth tax sized hole in the budget.

That proposal did not inspire advocates for a fair tax code.

“The math isn’t mathing,” Mansanarez said. “We need big progressive revenue getters, like a wealth tax, like the payroll tax. We won't get there by taxing cigarettes, I’m sorry.”

But where advocates saw an austerity, Ferguson saw irresponsibility. He moved the goal posts, insisting, even without the wealth tax, the Democrats wanted too much revenue.

"We need a balanced approach, using a reasonable amount of progressive revenue and adopting solutions to reduce our spending," Ferguson wrote in a press statement Thursday afternoon. “At a time of great economic uncertainty and assaults by the Trump Administration on core state services for working families, raising $12 billion in taxes is unsustainable, too risky and fails to adequately prepare Washington state for the crisis that looms ahead."

Yestramski speculated that not even Ferguson's Republican gubernatorial competitor would have been so awful in budget negotiations. And if he had been, then the Democrats would have forced him to veto the wealth tax and worked together to override it.

"I'm afraid that because he's allegedly a Democrat, the other Democrats aren't going to stand up to him," Yestramski said of Ferguson.

Luckily, Ferguson is not their boss. Their constituents are. 

Advocates urge Washington constituents to call their state representatives and the governor to demand that they tax the rich instead of making cuts. You can leave a message for your senator or representatives at 800-562-6000. Or find their specific phone number here. If you don’t know who represents you, you can find them here. You can call Ferguson’s office at 360-902-4111 and send him a message here. 

Goss said as a “glass half full” kind of person, they’re hopeful they can keep the wealth tax part of the conversation. Another idea: Democrats could pass a wealth tax as a referendum bill, bypassing the Governor’s veto power and instead sending it directly to the people. 

Goss admitted a statewide referendum would be an expensive fight, considering it would draw out the biggest baddest corporations, not just in Washington, but across the nation. As a novel tax, such a referendum would serve as an “emblem” for the struggle of everyday people against oligarchy, Goss said. 

And, a wealth tax referendum may sever progressive organizers from the wealthy donors who made them competitive in previous fights, such as venture capitalist Nick Hanauer who helped defend the capital gains tax and Amazon and Microsoft who backed the Climate Commitment Act against Let's Go Washington.

But luckily for the progressive coalition, public sentiment appears on their side.