That was then, this is now. In September of 2008, Gov. Christine Gregoire (D-WA) said her opponent, State Sen. Dino Rossi (R), was wrong. He based his gubernatorial campaign on a no new taxes pledge, and claimed she favored the adoption of a state income tax. The Governor responded vigorously by saying the accusation was “a big lie.” The Governor said an income tax would be “unwise and unrealistic.”
She was adament. If Gov. Gregoire was re-elected, she had no intention of pushing a tax. Washington is one of seven states without an income tax, and she promised it would remain that way. The Governor even produced a TV spot to emphasize her opposition.
Today Governor Gregoire reversed her position. She said she had signed a petition in favor of the tax, and “I suspect in the end that I am going to support it because candidly I have to say I don’t see another avenue to provide the kind of funding for education that we need.”
The petition Gregoire has signed is Initiative 1077 (I-1077). This would add another $1 billion net in new taxes on top of the $808-million-a-year tax increase the legislature has just imposed.
I-1077 is being promoted by Bill Gates Sr., the father of the Microsoft founder. Gates says the income tax will not be imposed on people who are below the top 3 percent of wage earners. However, Gates has acknowledged the legislature can — and frequently has — changed or repealed initiatives after two years as allowed by the state constitution. If that happened he would be “astonished,” but anyone famalier with the state legislature would not be surprised.
A GOP COMEBACK?
Washington state voters did not listen to Dino Rossi in 2008, but perhaps they will this year. National Republicans are strongly urging Rossi to run for the U.S. Senate this year against incumbent Patty Murray (D). According to two surveys, he is already defeating the Senator. Murray’s approval rating has dropped to 46 percent, with 61 percent of independents saying they disapprove of her job performance. She fails to break the 50 percent mark against any Republican and that alone confirms her vulnerability.
Republicans are now expected to gain an additional 8 seats in the Senate, and a Rossi victory would produce a dramatic 50/50 tie. It would be a crushing blow to the Obama administrations spending plans.
Rossi spent $8.5 million on his 2008 campaign and came within 133 votes of being elected Governor in 2004. Rossi would be entitled to say, “I told you so” on the tax issue.
The accusations he made in 2008 are all coming true. The Democrats reckless spending in Washington state has resulted in a record deficit. It is hard to believe now, but in 2008 one of Gov. Gregoire’s major issues was stem-cell research.
At that time Rossi said, “She’s trying to distract us from the issues that most people in the state are talking about. Issues like this $3.2 billion deficit that she has created and she’s going to raise your taxes to solve.”
If he does run this year, Rossi will not be accused of promoting “a big lie,” and an editorial in today’s Seattle Times described the negatives aspects of the new tax:
“On top of the 35 percent federal income tax rate, it would add a 5-percent tax on income above $200,000 by an individual, and a 9 percent tax on income above $500,000. Most people at these levels of income are running a business. They are the ones who can invest and create jobs. Our tax system should encourage them to do that here.
I-1077 encourages them to go away. Washington is already a high-cost state. The tax employers pay for unemployment benefits is higher than in most other states. So is the tax they pays for injuries at work. So are the costs of environmental protection. But Washington compensates by having no personal income tax. We are one of the few states that can say, ‘We levy no tax on success.’
Among the states, this is our trump card, our ace of spades. It has helped bring Washington cutting-edge companies, giving us a one of the most competitive, successful, high-wage economies in the nation. The sponsors of I-1077 ask that we give up that advantage.”