In too many states facing terrible budget shortfalls, proposals to cut vital services and even poorly targeted tax cuts are receiving a lot of attention from lawmakers. Progressive research groups are pointing out that states cannot escape their fiscal morass simply by cutting public services. This week, the Washington Budget and Policy Center released a letter to Governor Gregoire, the Speaker of the House and the Senate Majority Leader, which was signed by twenty economists urging them to consider all options when trying to balance the budget, including tax increases. The economists agree that, "Implementing deep cuts in government spending and declining to raise revenue through tax increases is not an effective strategy to guide Washington State out of this recession. The best strategy is to continue our long-term investments in education, health care, community vitality, and economic security."
Speaking of putting all the options on the table, the Minnesota Budget and Policy Project recently released their report Revenue-Raising Options to Help Close Minnesota's Budget Deficit. In a state where the Governor has repeatedly taken tax increases off the table, it's important that policymakers and the public realize that there are progressive revenue-raising options available. Read about the menu of options presented in the paper, including sales tax base-broadening, enacting an income tax surcharge, and the creation of new income tax brackets.