I must take issue with John Cushing’s argument that what we need in Washington state is more tax cuts (“Tax increases are not what we need,” Jan. 20).
In today’s global economy, tax cuts are a terribly inefficient and ineffective way to stimulate a local economy. They do an enormous amount of damage, and there is little or no evidence that they help much.
Look at the results of the massive tax cuts put through during the Bush administration.
Hundreds of billions of dollars were given away to wealthy elites on the theory that they would build jobs by investing the additional money in new enterprises. And in fact these funds did create millions of jobs — in China!
Here in the United States all we got was a massive increase in our national debt. And the actual number of private sector jobs in the United States today is less than it was when Bush entered office.
Mr. Cushing’s own employer, Boeing, is a past master at extracting tax cuts and manipulating the state government. The company has pulled in literally billions of dollars in tax breaks here in Washington over the past decades and, as far as anyone can tell, has used them largely to fund new operations overseas and in other states, draining jobs by the thousands from the Puget Sound area.
We have to get over the idea that taxes are always a drag on the economy. The opposite may be true in many cases.
State tax revenues get spent here in Washington state. They provide jobs to people who live here, and those jobs are by and large dedicated to providing vital services and resources to the citizens of Washington state. Businesses and families depend on the services that government provides to keep their daily operations running smoothly.
When tax revenues are cut, the money that is freed up may remains in our local economy, or it may be shipped off to remote multinationals or to Wall Street. But the damage is done directly to our own people and to local businesses.
Washington citizens lose their jobs. Washington clients cannot receive services. Traffic gets worse, freeways clog up, schools lose their teachers, social service rolls expand, etc. Remember the Tim Eyman tax cuts on license tags? Our ferry fares and schedules have never recovered.
In an age when hundreds of billions of dollars can vanish over an international border in the flicker of an eyelash, it is naïve to expect that cutting taxes in one local area will result in an economic bonanza for its citizens or businesses. The opposite is more likely to happen.
Tax policy can be used to stimulate a local economy, but to do that we will need to be much more focused on keeping the effects of tax rebates inside the local economy. The businesses won’t like that; they define “business-friendly” as tax giveaways with no strings so that they can ship the money wherever they want.
That’s great for them, but perhaps not so wonderful for the state taxpayer who is footing the bill.
— Islander Steve Graham is a retired University of Washington computer manager.
