The $16 billion lie behind the largest tax increase in state history

When someone makes a statement that simply is not true, I tend to call it that, rather than say it’s a lie.

If the state budget shortfall is nowhere near $16 billion, yet someone claims it is — as part of pushing through the largest package of tax increases in state history — labeling that as “not true” doesn’t seem strong enough.

It sounds more like a lie.

It doesn’t matter that Gov. Bob Ferguson has gone ahead and signed off on the tax package, and the new operating budget it supports. If Washington families will be forced to pay more for food, housing, health care, prescription drugs and even TV streaming because of tax increases based on a lie, they deserve to know.

There hasn’t been a shortfall in many years, but the trend of overspending in budget after budget finally caught up to our Democrat colleagues. Although it’s a real shortfall, this one wasn’t caused by an economic downturn. As Republicans have said all along, it’s entirely self-inflicted.

The majority came into this year’s legislative session talking about a $12 billion shortfall. That mysteriously jumped to $16 billion within a matter of weeks. Still, we saw no credible public explanation for how they arrived at that number — only vague references to expanding needs and increased caseloads, although the official caseload data said otherwise.

Even more frustrating was that many in the news media repeated the majority’s claim as though it was fact. They seemed unmoved by the competing shortfall figure Republicans offered, which was initially calculated by non-partisan legislative budget staff at $6.7 billion.
The non-partisan shortfall number climbed to $7.5 billion following the year’s first revenue forecast, in mid-March. While that is still a big gap, it’s much more manageable than $16 billion. For that reason, we were able to develop the “$ave Washington” budget, which was balanced without any new taxes and also made no cuts to services. It was a no-frills, steady-as-she-goes plan that relied on restraint — just the thing for getting through a budget shortfall.

Move ahead to May 20. The governor had already signed the five bills in the tax package, and, standing at the microphone minutes before literally signing the new budget, we heard his first reference to the $16 billion shortfall. Then another one, before meeting with members of the news media. Then five more times while answering media questions. It was almost like he used it as a crutch.

At one point it was “inheriting a $16 billion shortfall was not the way I wanted to start as governor.” When asked about his campaign promise to focus on affordability, he fell back on it: “During that campaign we were unaware of a $16 billion budget shortfall.”
When explaining how he’s not excited about approving tax increases, there it was again, about inheriting a $16 billion shortfall.

Again, when Ferguson took office, Democrats weren’t talking yet about a $16 billion shortfall. You wonder who came up with it, and when — and how. All we know is, it wasn’t the non-partisan budget staff.

One reporter had the courage to press Ferguson about the size of the shortfall, which provoked this revealing answer: “From our standpoint, going through the budget, we viewed this as a $16 billion shortfall that we needed to address.”

So, there it is. Non-partisan staff, who have no political agenda, calculated a $7.5 billion shortfall — but Democrats “viewed” the shortfall as $16 billion, and that’s what it became. There’s the truth, then there’s the truth according to the majority.

Here’s what the people of Washington need to know: The alleged $16 billion shortfall is a manufactured crisis that enabled the passage of the largest tax increase in state history.
To be clear, no one is saying the governor himself came up with the $16 billion claim. But if Ferguson is simply repeating something he was told to say, that’s a problem as well.

More than once on May 20, the governor spoke of how this new budget is based on actual revenue projections, instead of an artificially inflated number, like recent Democrat budgets.
That’s good. But notice how Ferguson’s interest in actual revenue projections apparently failed to also extend to an actual shortfall projection.

He told reporters he insists on being realistic about revenue, as that is one of the assumptions he can control — unlike the economy, or the federal government. So why not be realistic about the shortfall as well? Why inflate it to more than twice the real size, claiming the gap is $16 billion instead of $7.5 billion?

Between that and allowing the tax package to become law almost unscathed, Ferguson has left himself open to questions about his credibility.

Although many Democrats and special interests were mad at him early in the legislative session, they ended up winning. Not everything on their wish list made it into the budget, and some of their tax ideas didn’t get through this time, but wait until 2027 — because they have reason now to conclude that Ferguson’s bark is worse than his bite.

After all, he approved a new budget that is balanced with accounting gimmicks, after warning against using them. He said he would support a “reasonable amount of progressive revenue,” and declared that protecting working families from higher taxes was “the most important thing.” Then he signed off on the largest tax increase in state history, which goes far beyond reasonable or progressive, and will hit working families hardest.

But it’s worse than all that, because it seems apparent the tax increases also are based on a shortfall that was deliberately inflated.

Republicans dealt in reality and proposed a budget that wouldn’t take more from families that are struggling already; Democrats rejected it twice, and Ferguson has joined them in going in the wrong direction. State government is now on a path to take billions more from the people, based on a lie. That is not how our state does better.

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Sen. John Braun of Centralia serves the 20th Legislative District, which spans parts of four counties from Yelm to Vancouver. He became Senate Republican leader in 2020.