Article by Erik Smith. Published on Monday, January 10, 2011 EST.

$5 Billion Must be Cut From Budget, Replay of 1987 Gambit Seems Very Likely, and Just Wait Until Republicans Have Their Say

The door opens today on the 2011 Legislature. The session is supposed to last 105 days — though no one’s betting on an on-time finish in a year like this one.

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by Erik Smith

Staff writer/ Washington State Wire

OLYMPIA, Jan. 10.—Lawmakers return to Olympia to start their 2011 session, and what a session it’s going to be!

            It’ll be 105 days of political squabbling, in-fighting, tears, threats and back-room deal-making on a scale that hasn’t been seen in recent years. By the time lawmakers get done, state government is going to look substantially different – and quite a bit smaller. Odds are Republicans for once are going to play a major role in this year’s session, even though they’re the minority party – a possible replay of a budget maneuver that last played out in this state 24 years ago. That’s when things will get really wild. And all the theatrical business that makes politics the nation’s grandest sport will play out under the dome in Olympia – that’s the surest bet of all.

            Reality has finally caught up with the Legislature. Six years after the state embarked on a massive expansion in state programs, and two years after the Wall Street meltdown, the state of Washington has finally reached the point where lawmakers are beginning to concede that their spending can’t be sustained. They burned through all of the federal bailout money that will be coming, they have exhausted their reserves, and they aren’t going to be raising taxes – voters made sure of that.  Now there’s only one thing left for them to do – cut, and cut big. They have to whack $5 billion.

            Democrats are in charge of the House and Senate. Leaders are still whistling in the dark, hoping that they might be able to avoid enormous cuts to the signature social programs they have counted as among their proudest accomplishments of the last 20 years. “We’re looking for alternatives,” said Senate Majority Leader Lisa Brown, D-Spokane.

            And Gov. Christine Gregoire seemed to nod knowingly last week. “You know, I’ve been through where they have been. They are just several months behind me. And I went in with the exact same attitude that they’re expressing now. But when you get down to it, there aren’t any options. There just aren’t any options.”

            Some of it is a Real Cut

            When lawmakers talk about cuts, you normally have to take it with a grain of salt. Usually what they’re talking about is a cut in projected spending. And there’s a lot of that, to be sure, in the $5 billion figure that is being bandied about. There’s about $1.5 billion in new programs for the state’s K-12 schools that won’t be launched. Teachers and state employees won’t be getting scheduled pay increases. There’s a cost-of-living increase for the state’s pensioners that can be canceled. So on and so forth.

            But even when the slate is wiped clean of enhancements, there’s still plenty left to go – somewhere between $2 billion and $3 billion of actual budget-balancing spending reductions that have to be made. Lawmakers had hoped to wait out the recession, but the expected rebound never came. And now there’s a very good chance that major programs will be tossed over the side – things like the state Basic Health Plan, the state’s subsidized health insurance program for the working poor. And the “disability lifeline,” the state stipends and health programs for the homeless and disabled. Children’s health programs, food programs, state institutions for people with mental disabilities – all are eliminated in the governor’s budget proposal.

            It’s not that she wants to do it. If Gregoire had her druthers, lawmakers would be talking about tax increases this year. But last November voters said no, in a resounding way, to tax hikes during a recession that has hit them even harder than it has hit state government. They imposed a supermajority requirement on the Legislature that makes tax increases virtually impossible, rolled back a soda-pop tax increase lawmakers passed last year, and rejected an income tax.

“They said we really don’t want you to do anything but an all-cuts budget,” the governor said. “They had three chances and they said it three times. So maybe there would be a lack of clarity with once and maybe there would be ambiguity with twice. Three times, in baseball, you’re out. I got it. I heard it.”      

            Watch for a Replay of 1987

            What it means is that Democrats find themselves in a position only Republicans could love – having to find ways to make government more efficient, lopping nonessential programs, farming out services to the private sector, and just saying no to the public-employee unions. Whether they’re going to do it effectively is another question. But the busy governor spent much of the last month offering one proposal after another.

             And that leads to one of the most interesting questions of the session – will it be a replay of 1987?

            In that year, like this one, Democrats controlled the House, the Senate and the governor’s mansion. The state wasn’t in such a dire mess. But a big tax increase on business was being pushed by the governor and Democratic-party leaders. A trio of conservative Democrats in the Senate threw up their hands and decided to vote with Republicans. So that year, even though Republicans were in the minority, the GOP wrote the budget.

            One of the three is still around – Brad Owen, now the lieutenant governor. “I haven’t had any direct conversations with people, but I’ve heard and observed that that there is a conservative group of Democrats that have tried to work together and are kind of frustrated with how the leadership has gone and squeezed them to vote for things they don’t want to vote for. There may be some of the same parameters here. I don’t know what they’re thinking, but after a while you feel frustrated being asked to vote for things while never being asked for your take on things.”

            Breakdown on the Way?

            And that’s one of the things that makes this year so wild – the very real possibility of a complete breakdown of traditional party discipline that could see moderate Democrats joining with the Republicans, bypassing their more liberal party leaders and trying to find a bipartisan way out of the mess.

            Already, on opening day, there are telltale cracks. State Sen. Jim Kastama, D-Puyallup, will sponsor a resolution today that would deny a seat to a fellow Democrat, Sen.-elect Nick Harper of Everett, who was elected through nefarious campaign tactics orchestrated by labor unions and their allies. And state Sen. Tim Sheldon is proposing a rule change that would make it much easier for Democrats to vote with Republicans on the budget – not that the rule stopped Owen’s crew back in 1987.

            The problem right now is that Democrats are all over the map when it comes to the budget, Sheldon explained. Some don’t want to make any cuts at all. It’s just not in their nature. But someone has to make the cuts. “If you think the majority party is going to write the budget alone, that’s just not going to happen,” he said.

             And if conservative and moderate Democrats can’t bolt, he said, what’s going to happen is that lawmakers may sit and twiddle their thumbs for months, well past the session’s end date, right up to the beginning of summer. Of course that might happen anyway.

            Just Wait ’til Republicans Have Their Say

            And if Republicans have a say in things – that’s where things get really crazy. Odds are they’ll want to inject a few of their own ideas, and some folks aren’t going to like them very much. “We’re very concerned with making sure that some of the social safety net programs are maintained,” explained Senate Minority Leader Mike Hewitt, R-Walla Walla.

            It might sound strange, hearing the Republicans make a pitch for social programs at a time when leading Democrats are feeling their way down the path toward their termination. But some of them could be saved with cuts that strike at the heart of Democratic interest groups.

            There’s tort reform, for instance. Republican Attorney General Rob McKenna is urging the elimination of joint and several liability in lawsuits against the state, which means trial attorneys wouldn’t be able to go after the state’s deep pockets in cases where the state bears only a small portion of the blame. That could save as much as $40 million a year. The trial lawyers hate the idea.

            Then there’s the big bank account amassed by the Washington Education Association from excess state payments for teacher health insurance. Exactly how much is in there isn’t public information, but at one point in late 2008 it stood at $100 million. Republicans say they could force WEA to tap it by reducing the amount the state provides for health insurance. WEA doesn’t think much of that one.

            And then there’s Puget Sound cleanup – a cause dear to the state’s environmental groups. The governor’s budget, even while slashing social programs, contains $195 million for the purpose. That’s almost enough, by itself, to save the Basic Health Plan. “Puget Sound has been there for, oh, more than a hundred years,” said state Rep. Cary Condotta, R-Wenatchee. “We could put off cleanup for a couple of years and it’ll still be there.”

            It’s a thought that leaves the governor aghast. “Why didn’t I dump Puget Sound?” asked Gregoire. “It can’t wait. You can’t take a recess from Puget Sound, and expect that you’re going to have healthy fish to eat, and place for kids to swim, or commerce for us our economic opportunity, whether it’s tourism or the import-export market, what have you – so, yes I cut it, but I didn’t destroy Puget sound cleanup, that is not in our fiscal best interests.”

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