Chris Gregoire is bullish on Washington. Her optimism had better be well-placed – she’s asking to buy a ton of stock, in the form of a record $30 billion budget proposal.
Some, like the Association of Washington Business, would prefer a more conservative approach to investing. They worry that the amount the governor wants to invest will leave the state short of cash three or four years down the road, forcing painful cuts or tax increases. They also worry that the Legislature, dominated by Democrats, will eye the current surplus of nearly $2 billion and want to spend even more.
Those are legitimate concerns. Indeed, in order to achieve a balanced budget – which the state is required to do – state revenues will have to continue pouring in much faster than they have historically. And there’s no arguing that many legislators will view the governor’s proposal as a base upon which to build, not reduce.
While acknowledging the proposal’s risks, and wishing it were somewhat leaner, we generally support the governor’s investment strategy. Why?
It is built on the belief that the only politically realistic way to build a sustainable budget in Washington is through economic growth, and focuses on three inter-related investments to get there: education, economic development and health care.
Having a skilled workforce is key to attracting good-paying jobs in an increasingly competitive world. Gregoire’s budget provides more badly needed college enrollment slots, caps tuition costs, and makes investments in K-12 and early learning that will pay off in workers with world-class skills. That’s a big piece of a good economic development strategy, and it’s enhanced by an effort to make sure all of Washington’s children have health coverage. Besides the obvious benefit – healthy children make better learners – that should save money in the long run by getting care to kids before health problems become more severe and expensive to treat, creating one less drain on overall health-care costs.
Gregoire’s request for a constitutionally protected rainy day fund, an excellent idea put forth last year by Republican Sen. Joe Zarelli, adds a modest hedge against an economic downturn. But if a recession puts a damper on revenues, it will still force spending cuts that will derail many of Gregoire’s investment initiatives. She doesn’t think it will come to that, pointing to explosive growth in Asia that she says will help insulate trade-heavy Washington from a slowing national economy.
It’s a risk she says is worth making for Washington’s future. Only time will tell whether she’s a shrewd investor or a wishful thinker. For now, we’ll give her the benefit of the doubt.
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