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Morning Wire: Primary night, Gubernatorial race, Amazon’s Q2 earnings

The two key questions for me entering tonight are 1) how well will Larry Seaquist do in the Pierce County Executive race, and 2) will Marko Liias make it past the primary in the Lt. Governor race. The Pierce Co. Executive race pits a former Democratic legislator with modest name ID and not much money against a well funded, well respected Republican incumbent. Normally, this would be a safe hold for the incumbent. But in a year where the Republican brand is an anchor, this position will get strong winds from the national conversation. Whether those winds are headwinds or tailwinds is a matter of perspective. Will those winds scuttle an otherwise relatively successful incumbency?

In the Lt. Governor race, I think Denny Heck is likely to get through. If a second Democrat like Liias makes it, too, it’s possible progressive forces could rally to Liias’s campaign against the more moderate Heck. Lots of ifs there, but as I’ve said all year, this one is worth keeping your eye on.

With help from Michael Goldberg

1. It’s primary night! 

After voting ends at 8 PM this evening, we’ll see the first round of primary results for each seat up for election this cycle: 98 state house seats, 26 state senate seats, 9 statewide offices, 6 Superior Court races, and the 10 seats in Washington’s delegation to the US House. Throughout the primary season, we’ve provided extensive coverage in the form of virtual debatescandidate interviews, and race profiles

While a lot of ballots will still need counting after tonight, reporter Michael Goldberg and I will be posting live updates and candidate interviews throughout the evening on the Wire. As of last night, 27.6% of registered voters had submitted a ballot, which is a 10% higher turnout than four years ago. This is a good sign, as Secretary of State Kim Wyman said recently that she is concerned the new Postmaster General’s cost-cutting measures have led to disruptions in mail delivery. 

2. Video – Going Back to School: COVID & Education Equity 

If you’re interested in the intersection of education, COVID, race, and equity in our schools, City Year and the Wire co-hosted a unique “Going Back to School” virtual conversation last Wednesday. It was the kind of candid discussion that we could use more of, rather than less. In case you missed it, a video of the entire conversation is online.

We would also like to thank Denise Juneau (Superintendent, Seattle Public Schools), Sofia Voz (National Director of Staff & Learning Practice, City Year), and Lesley Hernandez (City Year AmeriCorps Member and Team Leader, Concord International Elementary School) for joining us. Amid a great deal of uncertainty during these COVID times, their thoughtful leadership is appreciated.

3. The challenges facing Republican gubernatorial candidates 

In a late July King 5 News Poll measuring head-to-head match-ups between Gov. Inslee and several Republican challengers, no candidate managed to drag the Governor below 60%. This has Inslee running 10 points ahead of another recent poll that may have been slightly over-weighted to Republicans. To contextualize these poll results, the Wire reached out to a few Washington State political consultants on both sides of the aisle.  

The consultants identified a few key factors for Republicans this election: COVID-19, President Trump, and the unwillingness of several leading candidates to run on a mainstream message. While a Republican consultant acknowledged that Inslee has the inner track to victory, he believes the GOP will ultimately unify behind a single candidate and mount a strong challenge. These poll results, however, suggest it won’t matter.

4. Amazon’s $5.2 billion of profits over 91 days 

Last week, Amazon reported earnings that were an almost-unheard-of 7 times higher than consensus estimates. That is jaw-dropping, even for Amazon, even in COVID when home delivery has been hugely helpful. Amazon’s profits soared to $5.2 billion in the second quarter alone, doubling its bottom line from the same quarter a year ago. The company’s net sales of $88.9 billion surpassed Wall Street’s expectations by $7.4 billion, and its earnings of $10.30/share were seven times the analyst consensus of $1.46/share, as I mentioned.

In the wake of the second quarter earnings report and Jeff Bezos’s testimony at a Congressional antitrust hearing, the Michael Goldberg reached out to three experts in three different specializations to hear about how Amazon got here, the broader economic context in which its profits surge is taking place, and the potential implications for policymakers. One takeaway: this sort of growth has both the left and the right concerned.

5. Watch what PUDs are doing to understand rural economic recovery

One lesson from the recovery from the Great Recession is that rural areas are slower to recover than urban ones. That makes the economic development work that PUDs do particularly important. That is even more the case as communities move to rely on broadband to support distance learning. These recovery strategies are often a constellation of narrow efforts that amount to larger whole. 

For example, utilities receive a rebate from Bonneville Power Administration for conservation work, which the state considers income and therefore subject to a B&O tax. HB 2505, which was passed and then vetoed last year as a cost saving measure, would have restored a B&O tax exemption for PUDs which the Department of Revenue ended in 2015. In turn, PUDs would redirect money they were paying the state to fund low income programs. The Washington PUD Association will push to overturn the veto should a special session occur or work to have the bill reintroduced in the general session, according to WPUDA Executive Director, George Caan. 

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