Flashback Series Graphic: Seattle Times vs. Seattle Times
Flashback Series Graphic: Seattle Times vs. Seattle Times

Read­ers, wel­come to anoth­er install­ment in our Flash­back series, where we enlist the help of past Seat­tle Times edi­to­r­i­al boards to debunk short­sight­ed and poor­ly rea­soned edi­to­ri­als pub­lished on the Times’ op-ed page in the present day.

Today, 2015 Seat­tle Times is going to help explain why 2021 Seat­tle Times’ oppo­si­tion to a cap­i­tal gains tax on the wealthy doesn’t make sense.

Twice now in the past two weeks (most recent­ly this morn­ing) the Times’ edi­to­r­i­al board has demand­ed in an unsigned edi­to­r­i­al that Sen­ate Democ­rats stop mov­ing for­ward with a sore­ly need­ed bill that would final­ly — final­ly! — take a sub­stan­tive step towards right­ing our upside down tax code by levy­ing a cap­i­tal gains tax.

The Times’ own­er, Frank Blethen, appears ter­ri­fied of the prospect that Demo­c­ra­t­ic leg­is­la­tors will move from talk to action after six years of mulling the idea of levy­ing a cap­i­tal gains tax. (Gov­er­nor Jay Inslee first pro­posed doing so in Decem­ber of 2014, and the idea has been under con­sid­er­a­tion ever since, but it’s nev­er been act­ed upon, despite clear evi­dence the pub­lic sup­ports it — includ­ing six straight years of polling com­mis­sioned by NPI.)

In just a few days, Blethen’s op-ed page has run the two afore­men­tioned edi­to­ri­als plus an op-ed from pro­gres­sive tax reform oppo­nent Matt McIl­wain of Madrona Ven­ture Group, who is utter­ly opposed to any form of tax on wealth. (He’s wealthy and does­n’t want to pay his fair share in dues to our state.)

A rebut­tal op-ed sup­port­ing the cap­i­tal gains tax from Nick Hanauer was also pub­lished — but the print ver­sion of it hilar­i­ous­ly includ­ed a small side­bar urg­ing read­ers to check out McIl­wain’s piece. (The online ver­sion links to the edi­to­r­i­al instead.) Of course, since McIl­wain’s piece was pub­lished first, there was no cor­re­spond­ing side­bar pro­mot­ing Hanauer’s per­spec­tive. Very convenient.

Those new to Wash­ing­ton State pol­i­tics might be for­giv­en for think­ing that the Seat­tle Times Com­pa­ny and its own­ers have always opposed pro­gres­sive taxation.

The truth, how­ev­er, is that the Times has a long his­to­ry of vac­il­lat­ing on this sub­ject. Dur­ing the past two decades, the Times has gone from oppos­ing Tim Eyman’s destruc­tive ini­tia­tives to sup­port­ing them — and then oppos­ing them again. It has come out in sup­port of levies to fund essen­tial pub­lic ser­vices, and at oth­er times, it has denounced them. I know of no oth­er edi­to­r­i­al board any­where with a mer­cu­r­ial ide­o­log­i­cal drift like that of the Seat­tle Times.

I have observed before in this space that the Times’ edi­to­r­i­al board is kind of like the char­ac­ters in The Strange Case of Dr. Jekyll and Mr. Hyde, Robert Louis Steven­son’s Goth­ic novel­la. At times, you can open up the Seat­tle Times and find edi­to­ri­als in the Opin­ion sec­tion that are root­ed in the log­ic of pro­gres­sive val­ues and espouse wor­thy ideas Cas­ca­dia needs. That’s the paper’s Jekyll persona.

Just as often, unfor­tu­nate­ly, you can open up the news­pa­per and find tru­ly awful, cringe-induc­ing edi­to­ri­als par­rot­ing dis­in­for­ma­tion and debunked right wing myths about any num­ber of sub­jects, espe­cial­ly the econ­o­my, trans­porta­tion, and mat­ters of pub­lic finance. That’s the paper’s Hyde persona.

It is pre­cise­ly because the Times has these mul­ti­ple edi­to­r­i­al per­sonas that we can bring you the Flash­back series here on the Cas­ca­dia Advo­cate. We can debunk the edi­to­ri­als that came out of the Hyde per­sona with the board­’s own unat­trib­uted words from some oth­er date because the paper also has a Jeyk­ll persona.

Hypocrisy and dou­ble stan­dards are cer­tain­ly com­mon in pol­i­tics, but as we’re about to see, the Times’ present oppo­si­tion to a cap­i­tal gains tax is not a gar­den vari­ety case of hypocrisy. This is cog­ni­tive dis­so­nance at its finest.

With that intro­duc­tion, let’s dive in!

We’ll start with last week’s edi­to­r­i­al from 2021 Seat­tle Times:

A cap­i­tal-gains tax bill mov­ing toward a state Sen­ate vote is too flawed and should be aban­doned. The Demo­c­ra­t­ic leadership’s rush to cre­ate this tax even as the state’s rev­enue pic­ture is expect­ed to con­tin­ue improv­ing, cou­pled with its disin­gen­u­ous use of the legislature’s emer­gency pow­er, fur­ther sig­nals a need for vot­er skepticism.

Hm. What do you think about the idea, 2015 Seat­tle Times?

A long-term solu­tion to the edu­ca­tion-fund­ing cri­sis in Wash­ing­ton is right in front of law­mak­ers. Instead of punt­ing to com­mit­tees and next year’s Leg­is­la­ture, they should buck­le down and make the choice to begin tax­ing cap­i­tal gains.

Makes sense. Less talk­ing, more doing! Our team agrees with 2015 Seat­tle Times. A cap­i­tal gains tax was a good idea in 2015 and it’s still a good idea now — the votes unfor­tu­nate­ly did­n’t exist to pass it back then, due to Repub­li­can con­trol of the Wash­ing­ton State Sen­ate, but Democ­rats run both cham­bers now and can get this done. The need is still great, and the pan­dem­ic has shown us that.

Let’s exam­ine anoth­er bad argu­ment from 2021 Seat­tle Times:

The state con­sti­tu­tion pro­hibits [an] income tax. The cur­rent Supreme Court may decide a tax on cap­i­tal gains is accept­able. If this tax pass­es, the inevitable lit­i­ga­tion would delay col­lec­tion for months, per­haps years. Even with­out the courts, the rev­enue would not begin com­ing in until 2023.

2015 Seat­tle Times, is that a con­cern for you?

Cap­i­tal-gains rev­enue would fluc­tu­ate with the stock market.

The House pro­pos­al address­es this by cre­at­ing a “stu­dent invest­ment fund” to fund basic K‑12 edu­ca­tion and keep high­er-edu­ca­tion tuition steady. Addi­tion­al rev­enue in strong years would be saved, build­ing a reserve to cov­er costs dur­ing down years.

Argu­ments that these are stealth income tax­es should be heard in con­text. The income in ques­tion is large­ly prof­its gen­er­at­ed by very large invest­ment port­fo­lios, above and beyond retire­ment accounts.

What a refresh­ing­ly dif­fer­ent van­tage point.

And a good obser­va­tion, too, about the tax being a means of secur­ing an invest­ment in our state’s future from peo­ple who are accu­mu­lat­ing wealth not based on work, but rather mar­ket machi­na­tions and manipulations.

Wash­ing­ton’s tax sys­tem is sad­ly not based on abil­i­ty to pay, which is why it’s been ranked dead last in the coun­try among all states’ tax sys­tems in terms of fair­ness. We have one minor tax on wealth right now — an estate tax — which is devot­ed to the Edu­ca­tion Lega­cy Trust, and that’s basi­cal­ly it.

The Wash­ing­ton State Con­sti­tu­tion, by the way, does­n’t say that the state may not levy an income tax. If you search the text of the Con­sti­tu­tion for such a pro­hi­bi­tion, you won’t find it, because it does­n’t exist. The notion that the Con­sti­tu­tion dis­al­lows tax­ing income stems from a goofy 1930s-era Supreme Court deci­sion that threw out a vot­er-approved ini­tia­tive pro­vid­ing for an income tax. That deci­sion was absurd­ly rea­soned, and is wait­ing to be overturned.

The Times con­ced­ed as much in its edi­to­r­i­al from last week when it stat­ed: “The cur­rent Supreme Court may decide a tax on cap­i­tal gains is acceptable.”

Curi­ous­ly, in this morn­ing’s fol­low-up edi­to­r­i­al, the Times has a line sug­gest­ing the very oppo­site could hap­pen: “And the Supreme Court may well find that a cap­i­tal gains tax vio­lates the state constitution’s ban on tax­ing income.”

(There’s that cog­ni­tive dis­so­nance again — with even clos­er proximity!)

By the way, under the log­ic of the anti-tax crowd, all tax­es are effec­tive­ly income tax­es because they are paid out of peo­ple’s incomes. And if we can’t tax income, then we can’t have any tax­es at all, which means we can’t have any essen­tial pub­lic ser­vices, which means we can’t have a func­tion­ing state. Just dumb.

Let’s go back to 2021 Seat­tle Times:

True, this edi­to­r­i­al board sup­port­ed a cap­i­tal-gains tax in 2015 as the Leg­is­la­ture strug­gled to meet its con­sti­tu­tion­al require­ment to ful­ly fund basic edu­ca­tion, under the 2012 Supreme Court McCleary rul­ing. That cri­sis is no longer upon lawmakers.

Ha! Actu­al­ly, an even worse cri­sis is upon law­mak­ers now.

We’re in the midst of a dead­ly, crip­pling pan­dem­ic, and despite advances in test­ing, con­tact trac­ing, and vac­ci­na­tion, along with a greater avail­abil­i­ty of masks and PPE, we have not fig­ured out how to safe­ly return most of our teach­ers and stu­dents to in-per­son instruc­tion after almost a year of schools being closed.

Nor did leg­is­la­tors ever get around to address­ing the spe­cial edu­ca­tion fund­ing cri­sis, or revers­ing harm­ful cuts to arts, music, cul­tur­al, and civic edu­ca­tion when they were pass­ing leg­is­la­tion to respond to McCleary in pri­or sessions.

In short, the job nev­er got done. And Wash­ing­to­ni­ans know it: 60% of vot­ers NPI’s poll­ster sur­veyed last year agreed with the state­ment that our schools are under­fund­ed and we need to raise state rev­enue to ful­ly fund them.

I do appre­ci­ate the acknowl­edg­ment of the Times’ past posi­tion. That flash of hon­esty is some­thing we rarely see in an edi­to­r­i­al like this. You’ll notice, if you parse this edi­to­r­i­al care­ful­ly, that there are shades of the Jeyk­ll per­sona sprin­kled here and there. It’s a Hyde edi­to­r­i­al, but the Jekyll per­sona is not entire­ly silent.

2015 Seat­tle Times, any thoughts?

Sen­ate lead­ers have agreed on a bipar­ti­san pro­pos­al to meet the state’s con­sti­tu­tion­al oblig­a­tion to ful­ly fund basic edu­ca­tion and pro­vide an equi­table edu­ca­tion for all stu­dents. They also agree that more rev­enue will be need­ed — about $3.5 bil­lion every two years — but now need to decide where it should come from.

Not to be con­fused with the imme­di­ate 2015–17 state bud­get debate, this would be a long-term fund­ing source as law­mak­ers replace local edu­ca­tion levies with state funding.

A remark­ably dif­fer­ent take, eh? Even though Repub­li­cans were in con­trol of the State Sen­ate at the time, the Seat­tle Times still edi­to­ri­al­ized in favor of levy­ing a cap­i­tal gains tax on the wealthy, giv­ing the idea the respect it deserved.

Repub­li­can law­mak­ers, of course, did not lis­ten, and they pur­sued a prop­er­ty tax based “McCleary fix” that was­n’t real­ly a fix at all.

That bit above about the cap­i­tal gains tax being a long-term fund­ing source is real­ly impor­tant. Wash­ing­ton’s pub­lic finances have been in lousy shape for a long time because our upside down tax code dates back to the after­math of that goofy Supreme Court deci­sion I men­tioned. Long term struc­tur­al prob­lems require long term solu­tions, and a cap­i­tal gains tax is such a solution.

Our starved pub­lic ser­vices need rev­enue, but low­er and mid­dle income fam­i­lies are already con­tribut­ing plen­ty to sup­port them through the sales tax, prop­er­ty tax, and busi­ness and occu­pa­tion tax (which is a tax on gross receipts). Wealthy fam­i­lies, on the oth­er hand, are pay­ing almost noth­ing. That’s wrong. The sta­tus quo is unac­cept­able. We need action to change that, and we need it this session.

Back to 2021 Seat­tle Times:

More than forty oth­er states tax cap­i­tal gains. Wash­ing­ton may some­day join that list, but this ill-con­ceived leg­is­la­tion would be a bad way to get there. Vot­ers’ back­lash would be well-deserved.

Stop SB 5096 now.

2015 Seat­tle Times, your view?

Tax­pay­ers at this lev­el have ben­e­fit­ed direct­ly or indi­rect­ly from pub­lic invest­ments in edu­ca­tion. They would ben­e­fit fur­ther by sup­port­ing an equi­table sys­tem that pro­vides equal oppor­tu­ni­ty for stu­dents in every school to learn and help build Washington’s future.

They cer­tain­ly would. Whether a cap­i­tal gains tax is devot­ed to K‑12 schools, or to high­er edu­ca­tion, or to child­care — as this leg­isla­tive ses­sion’s pro­pos­als favor — it would reduce inequity in our state and strength­en our com­mon­wealth. Every­one would win, includ­ing and espe­cial­ly the peo­ple who would pay the tax.

Like Nick Hanauer has said, the wealthy (espe­cial­ly our local bil­lion­aires, who have the most wealth) will still be wealthy if we levy a cap­i­tal gains tax. But they’ll be invest­ing in Wash­ing­ton State to a slight­ly high­er degree than before. That would be an impor­tant step towards hav­ing a more pro­gres­sive tax code.

It is tru­ly sil­ly that the Seat­tle Times is describ­ing the cur­rent efforts to pass a cap­i­tal gains tax on the wealthy as “rushed” and “hasty” giv­en that the idea has been under con­sid­er­a­tion for over half a decade. For what­ev­er rea­son, this seems to be their favorite argu­ment, which they not only begin with, but end with too, as we can see from the con­clud­ing para­graph in this morn­ing’s edi­to­r­i­al:

Writ­ing an equi­table tax code is hard work. It deserves to be treat­ed with dili­gence, not hus­tled through piece­meal with thin jus­ti­fi­ca­tion. The Sen­ate has SB 5096 queued for an immi­nent vote. It should not pass.

I’m not sure I’ve ever seen a more dis­hon­est char­ac­ter­i­za­tion of the process sur­round­ing a bill in the Leg­is­la­ture. We are halfway through the 2021 ses­sion and all that’s hap­pened so far is that the Sen­ate is pro­gress­ing towards a floor vote on an idea that has been under con­sid­er­a­tion for a real­ly, real­ly, real­ly long time.

Noth­ing is being rushed. Mul­ti­ple pub­lic hear­ings have been held and the bill has been revised and amend­ed based on that pub­lic testimony.

And the bill will assured­ly be amend­ed again. The ver­sion that gets con­sid­ered on the Sen­ate floor may not even be the ver­sion that Ways & Means approved.

The House has its own ver­sion of this pro­pos­al, although curi­ous­ly, that bill has gone unmen­tioned in both Seat­tle Times edi­to­ri­als. Per­haps that’s because Blethen fears if the shrunk­en fac­tion of the Sen­ate Demo­c­ra­t­ic cau­cus that oppos­es a cap­i­tal gains tax can’t stop a vote in the Sen­ate, the prospects for the bill will be all down­hill from there — all the way to Gov­er­nor Inslee’s desk.

The specter of a “vot­er back­lash” is also unfounded.

NPI has been ask­ing Wash­ing­ton vot­ers about their views on levy­ing a cap­i­tal gains tax to fund invest­ments in edu­ca­tion for six straight years.

Every sin­gle time we’ve asked, we have found robust pub­lic sup­port.

Our last poll found near­ly three in five Wash­ing­to­ni­ans (59%) supportive.

What’s more, the per­cent­age who “strong­ly” sup­port a cap­i­tal gains tax on the wealthy to ben­e­fit edu­ca­tion has been con­sis­tent­ly above 40% — con­sis­tent­ly greater than the entire per­cent­age of those opposed.

The right wing may be opposed to a cap­i­tal gains tax on the wealthy, but the pub­lic is not. Leg­is­la­tors can move for­ward with this wor­thy idea with the knowl­edge that it’s some­thing Wash­ing­to­ni­ans want to see get done.

If you enjoyed this post, you’ll prob­a­bly want to read some of the oth­er install­ments in our Flash­back series, which dates back to 2008!

Previous installments of Flashback

About the author

Andrew Villeneuve is the founder and executive director of the Northwest Progressive Institute, as well as the founder of NPI's sibling, the Northwest Progressive Foundation. He has worked to advance progressive causes for over two decades as a strategist, speaker, author, and organizer. Andrew is also a cybersecurity expert, a veteran facilitator, a delegate to the Washington State Democratic Central Committee, and a member of the Climate Reality Leadership Corps.

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