Slimmed down, the state must put education first

THE budget released by the Washington State Senate reflects the harsh realities of the state's economy.

Given the size of the problem — $6 billion shortfall after the receipt of federal stimulus money — most of the $3.8 billion in program cuts make sense. Lawmakers should cut the number of state employees more and education less. Every dollar spent on education represents the best possible social program and wisest long-term investment.

Notably, budget writers suspended an initiative for higher teacher pay and slashed one for smaller class sizes. Both were approved in rosier times without a source of money to support them, and they are largely sacrificed. This page opposed both initiatives because they came with no new source of money. Their approval worked at a time when the state had a surplus.

Planned cuts in education set the stage for an unfair either-or decision, a public vote in November on possible sales- and sin-tax increases to restore money to schools. A sales-tax increase makes little sense in such a weak economy. With local add-ons, the general tax rate in most of King County goes to 9.5 percent Wednesday, with restaurant food at 10 percent. These are some of the highest rates in the country.

Lawmakers whacked $500 million from higher education, but that is offset somewhat by tuition increases of 5 percent at community colleges and 7 percent at four-year institutions. Still, the $160 million in increased tuition dollars is not sufficient to save spaces for 10,000 students. This is a backward step. The state needs to do better in preparing young people to work in the new economy.

Other cuts are painful but, if education is the top priority, probably unavoidable. These include a cut of 40,000 people covered by the Basic Health Plan. These cuts help now but cost later. People who do not undergo basic preventive care show up in hospital emergency rooms as more expensive patients, a cost private payers absorb.

It's hard to manage a $9 billion deficit without borrowing from the future. Though called an "all-cuts" budget, the plan actually is part delay, part shuffle-around. It delays part of the money that should have been paid to state employee pension plans — about $400 million.

The spending plan raids the capital budget by about $700 million and draws down the "rainy-day fund" by about $400 million — but that is what it's for. It's raining, and then some. (The new budget also has healthy reserves; about $850 million).

The proposed spending plan includes small amounts of revenue. The largest is extending the real-estate excise tax — the tax you pay when you sell your house — to banks selling foreclosed houses. For some strange reason, they had been exempt. The Senate also proposes to repeal the tax break on hybrid cars, which, considering the cost to the state, is reasonable.

Every budget in memory has been greater than the one before. You can tell that things have changed in Olympia when the Senate Democrats propose a $32.1 billion budget that is 3 percent less than the previous budget.

The House presents its budget Tuesday. Word is it has bigger cuts in higher education — which will be very difficult to accept.

As Gov. Christine Gregoire said when she released her rosier budget last December, there is something for everyone to hate. Four months later, there's even more to detest.