Trump: State officials planning for ‘chaos’ of second Trump term

By The Herald Editorial Board

Having won his second term as state treasurer, Mike Pellicciotti, already has plenty on his plate as the Legislature prepares for its every-other-year budget session, one for which spending demands are increasing while revenues have slipped.

That’s resulted in projections of a $12 billion budget shortfall and prompted out-going Gov. Jay Inslee to order a hiring and travel freeze, as he finalizes his proposed budget and lawmakers continue their discussions.

But added to those concerns in Pellicciotti’s mind is federal funding in the billions of dollars — $27 billion in the most recent fiscal year — that helps the state fund Medicaid and other health care, law enforcement, education and more.

In the months leading up to the election — as polls were showing a tight race between Democrat Kamala Harris and Republican Donald Trump — Pellicciotti, like other Democratic state officials in Washington and other blue states — began contemplating what a return to the White House by Trump could mean in this Washington.

Gov.-elect Bob Ferguson, who was in his second term as state attorney general during the first Trump administration, is able to draw from firsthand experience as to what might be ahead during Trump 2.0, having led an office that filed 36 of its own lawsuits against Trump and the administration’s agencies, joined in another 63 with other states’ attorneys general and notched a record of at least 47 legal victories upholding constitutional rights and protections — eight court wins are on appeal or could be appealed — to only three losses.

Shortly after Trump’s second win, Ferguson, joined by attorney general-elect Nick Brown, announced their intention during a news conference to defend the state’s interests, in particular regarding access to reproductive health care, protection of LGBTQ+ rights and protection from deportation for residents with Obama-era Deferred Action for Childhood Arrivals status, those who arrived in the U.S. as children without legal authorization but have built law-abiding and productive lives here.

But while Brown and Ferguson prepare to tackle potential policy issues in court, Pellicciotti hopes to head off a possible mode of coercion and/or spite by the next Trump administration that could delay or cut federal funding to the state.

That federal funding, Pellicciotti said during an interview last week, could allow a president who wishes to coerce or punish a state to have significant leverage if that state is not financially sound and independently strong.

Pellicciotti said he’s already been in discussions with the Biden administration to update existing contracts to create disincentives for the federal government to withhold federal funding that Congress has allocated to states. He’s had similar conversations with state treasurers from other blue-leaning states with similar concerns. The Biden administration, he said, is considering that request.

Even assuming that a court might reverse such an action by a presidential administration, that legal process can be lengthy. And any prolonged period without those funds, Pellicciotti said, could force defaults and a loss of credit rating for a state.

Trump, he said, could bring chaos, “and that chaotic approach could affect individual state economies.”

Pellicciotti said states do take steps to insulate themselves from a range of unexpected financial hits; at any one time, Washington has about $17 billion in its accounts and another $4 billion in reserves, but finding a way to keep federal funds from being withheld would further help maintain that cushion.

A strong financial footing, he said, could be its own protection from the potential use of coercion.

“If we independently insulate ourselves financially in a way that ensures that we’re able to meet the needs of the people at the state of Washington, we can ultimately discourage coercive attempts that would be less successful if we are better positioned with a strong state treasury,” he said.

For those who doubt the likelihood that Trump would attempt to withhold federal funding, the threat has been made before, and carried out more than once, the treasurer noted.

During his first run for treasurer, Pellicciotti noted that Trump attempted to withhold federal funding from Seattle, Portland, Ore., and New York, angered by what he and then-Attorney General Bill Barr saw as a weak response to protests and unrest in 2020 regarding policing tactics following the murder by police of George Floyd and others.

“That was a coercive tactic that many career federal employees refused to enforce because they believed it was in violation of a post-Watergate law that limited the power of the executive to take such capricious actions,” he said.

That law, the Impoundment Control Act of 1974 — which affirmed Congress’ constitutional budget authority and prohibits a president from withholding funding that Congress has allocated — still is law, but Trump has called it unconstitutional, key to his plans for sweeping budget cuts under his proposed Department of Government Efficiency, being led by Elon Musk and Vivek Ramaswamy.

At the same time that the Trump administration was taking aim at blue cities, Trump was more successful in targeting disaster relief for smaller cities in Washington state, this time in Eastern Washington.

During a personal feud with Gov. Inslee two months before the 2020 election, Trump refused to act on Inslee’s $37 million request for federal disaster funding, following wildfires in southeast Washington, including the devastated town of Malden. Even appeals from U.S. Rep. Cathy McMorris Rodgers, the district’s Republican representative, were ignored. The federal funding wasn’t received until Trump was out of office; President Biden delivered $45 million in aid, two weeks after taking office but 141 days after the aid was first requested.

While the guardrails put up by federal employees and even some Trump administration officials held in 2020, Pellicciotti is more uncertain those guardrails will hold this time.

“I am not confident that those career federal employees who would normally follow the law will be the same people in those positions under a new presidential administration,” he said.

All the more reason, Pellicciotti said, to prepare legal arguments and financial stability.

“How do we make sure that any litigation with the federal government is able to take place fully, and doesn’t coerce actions against the state of Washington?” he said.