The state of Washington is in deep financial trouble with declining revenues, rising unemployment and overly generous benefit packages to public unions, not forgetting years of overspending since Governor Gregoire surreptitiously gained the governor’s office in 2004.
Unemployment has steadily increased nationwide ever since mid-2007 after Democrats gained control of both houses of congress in Washington D.C. and they decided to “fix” what they then labeled a very poor economy. Naturally, their “fixes” has added to our states woes, leaving us in the current predicament.
Ever since the economy was noticed to be heading further into the economic abyss we now suffer, several more “fixes” have been applied that has only plunged us deeper and deeper into the morass. Federal Stimulus and bail-outs did nothing more than increase the public debt to historic levels.
In Washington State we saw several efforts applied that was supposedly to lead us into recovery. Taxes and fees were raised and small businesses continued to fail, succumbing to new taxes and lack of sales due to increased taxation.
An effort at an income tax was once again defeated and some of the sillier taxes were repealed. Elections sent some new legislators to Olympia, but not enough to change the majority, still in the hands of the very Democrats that led us to this point.
We hear the governor finally speaking of drastic cuts that even she says are “immoral.”
Although it has not been formally introduced in Olympia by any legislator, former national reporter for Newsday and The Associated Press, and former journalist for the Seattle Times Hugo Kugiya reminds us how legislators often turn to vices for what we refer to as “sin taxes” and indicating one vice so far left basically untouched in a Crosscut article, Will the state turn to a gambling fix?
So far, just as he states in his article, Indian Tribes hold a monopoly on casino gambling, the state so far limited to “games like bingo, pull tabs, card rooms, raffles, horse racing, and the lottery, but are are taxed only by counties and municipalities.”
Of course, the state collects a “nominal business and occupation tax from gambling licensees” on the limited gambling allowed, but collects nothing off of the tribal casinos, them being protected by federal treaties signed long ago.
Such a casino is slated to be built in Clark County, recently gaining approval from federal court and is almost equally supported as it is opposed by Clark County residents. Should it actually be built, the potential for jobs is there, although they will undoubtedly be very low paying. The bulk of the net proceeds also will go to the tribe and backers of the casino, not necessarily Clark County or Washington State.
Kugiya tells us,
“Over the past decade or so, at least two initiatives to expand non-tribal gambling have been voted down by the state legislature by an overwhelming majority. Now, with the state in the grip of one of its worst budget crises… the scent of gambling is once again in the air.”
Should we look at legalizing more gambling in the state to raise revenue? President and CEO of the Washington Restaurant Association Anthony Anton says,
“It’s a perennial issue whenever there’s a budget crunch. More and more people can go online to gamble but you can’t do it at a restaurant where it could be taxed. More and more people are asking, ‘so exactly why is it illegal’?”
Not quite accurate since a 2006 law passed by our legislature changed the penalty for Internet gambling from a gross misdemeanor to a class C felony. Facing declining numbers of people eating out at restaurants, I imagine the effort would be more for encouraging customers to return to their restaurants over increasing revenues collected by the state.
We read that “Twenty-two tribes operate 28 casinos in Washington State, generating an estimated $1.75 billion in net revenue in fiscal year 2010.” Undoubtedly, very attractive numbers for our tax happy Democrat led legislature.
Anton continues, “I haven’t seen any proposal by anyone yet. I haven’t seen a coalition come together; I haven’t seen any legislator try to get anything organized, but the issue is out there. If we did what Oregon did [allow and tax various forms of video gambling, like poker and slots, in bars], we would generate billions. Doesn’t that say, ‘hey we ought to give it a try’?”
With their budgetary and revenue problems, Oregon is hardly an example we should follow.
Should the legislature actually think about adding gambling as a source of revenue for the state, stiff opposition can be expected from tribal casinos that depend on their gambling to fund their tribes. In Washington State, we are told it is “their most important if not only meaningful economic resource,” by 38th legislative district Democrat, Rep. John McCoy.
Anton agrees saying,
“The tribes are a major political entity in the state. I’m not begrudging that fact. I understand they want to protect that. The tribes’ reluctance to give up their monopoly is a barrier [to expand state-run gambling]. I’m not sure the right proposal has been put together yet in Washington, a way to balance everyone’s interests. It takes the right year, the right coalition and the right leaders.”
Still missed in all of these discussion is that our problem has long been a spending problem, not a revenue problem. Even with cuts to the budget that governor Gregoire describes as “immoral,” unsaid all too often is that 70% of the state budget is “protected,” mandated spending that is to be left alone. Almost half of that is slated for “education” undoubtedly much of it going to fulfill public union contracts for teachers and other school employees in wages and benefits.
Some public unions have agreed to a 3% reduction in wages, but most contribute little or nothing to health insurance premiums. We have overly expensive contracts for projects in the state. If any homeowner had the time and the chance, I’m sure most of us existing now on greatly reduced home budgets could identify waste that could be eliminated or real sacrifices that should be made.
One small comment within the article almost goes unnoticed, even though it identifies an area the state lost revenue in, in spite of being warned so at the time it was proposed, smoking bans that contributed to sending people away from card rooms and to Indian Casinos.
I have no aversion to gambling like many do and have played games in Las Vegas, Lake Tahoe and Reno, Nevada.
But, if gambling was really the answer to states budget problems, would Nevada be facing the same budget problems as other states today?