Gregoire Ignored Budget Warnings, Now Faces the Consequences

I usually try to avoid getting into political issues on here, but something has come up that I simply cannot ignore. A few days ago the Seattle P-I posted videos from Christine Gregoire and Dino Rossi where each candidate makes the case on why you should vote for them. As I was watching Christine Gregoire’s 4-minute pitch, I was dumbfounded by the egregious claims she was making regarding the state budget.

Since housing has been such a large part of the state economy over the last few years, I have been paying attention to these issues for some time now. Frankly, I am appalled that Christine Gregoire would make the blatently false statements she offered in her video as reasons to vote for her, and I feel that it is relevant to bring them to light here.

Claim: “I balanced the budget … I’ve turned it into a surplus.”

Christine Gregoire claims that she single-handedly took a $2.2 billion projected deficit for the 2005-2007 biennium and turned it into a surplus.

Reality: The budget practically balanced itself.

Two-year state tax revenues increased $5.3 billion between 2005 and 2007 (source: Washington State Department of Revenue), thanks to the booming economy including huge increases in property tax and real estate excise tax collections. Meanwhile, Gregoire has increased spending by $8 billion (source: Seattle Times). The budget was balanced despite Christine Gregoire, not because of anything she accomplished.

Real Estate Tax Collections Soared
Click to enlarge

Claim: “No corner of America has been able to avoid the failed economic policies of Washington, DC.”

When discussing the projected $3.2 billion deficit for the 2009-2011 budget, Christine Gregoire puts the blame on George Bush.

Reality: Gregoire ignored repeated warnings from the state’s top economist that the housing-fueled boom in the state economy was temporary and revenues would be returning to lower levels soon.

Here’s what Washington’s Chief Economist ChangMook Sohn was saying while Gregoire was increasing spending $8 billion in four years:

November 2005 – “There are many signs that housing is peaking.”
June 2006 – “We can’t assume that this hot economy can continue into the next biennium.”
November 2006 – “The expected cooling of Washington’s once-torrid housing and construction sector is under way.” (AP paraphrase)
September 2007 – “Some slowdown is inevitable.”

Chief Economist ChangMook Sohn issued repeated warnings to exercise caution.
Click to enlarge

Christine Gregoire says that she “‘inherited a 2.2 billion dollar deficit.” In reality what she inherited was a booming real estate market that helped total tax revenue to increase by 22% in just three years. However, because she ignored the advice of Chief Economist Sohn, the state must now make difficult cuts such as a hiring freeze (source: Seattle Times) and an across-the-board one percent cut (source: Seattle Times).

Furthermore, does anyone remember back in January, when Gregoire said this:

I’m struggling to get the message out to Washingtonians. The economy is strong. Buy your home. There is no good reason for a slowing of home purchasing in the state of Washington today.

Since Gregoire gave the advice that everybody jump into a declining housing market, median prices have declined 7%, state unemployment has increased 33% from 4.5% to 6.0%, the stock market has fallen 20%, and the failure / sale of WaMu has caused our state to lose its only major national bank. If anyone actually jumped into the housing market based on Gregoire’s advice in January, they’re probably wishing they hadn’t right now.

Gregoire's Housing Advice
Click to enlarge

I bring these things up not to tell you who to vote for, but simply to point out the nonsense malarkey that Gregoire has been spouting regarding the state budget. The bottom line is that during the boom years she had the choice to exercise caution and restraint or to go on a spending spree. She chose the spending spree despite the warnings of Chief Economist Sohn, and now we’re facing the consequences.

About The Tim

Tim Ellis is the founder of Seattle Bubble. His background in engineering and computer / internet technology, a fondness of data-based analysis of problems, and an addiction to spreadsheets all influence his perspective on the Seattle-area real estate market.


  1. 1
    deejayoh says:

    Pivoting a discussion of the budget deficit around real estate taxes seems a bit narrowly focused to me.

    Total tax collections in Washington state are around $17B. Real esate excise taxes are about 5% of the total take.

    I’m not defending Greqoire – but it seems this must be about way more than just RE Excise taxes

  2. 2
    Ubersalad, Ph.D says:

    Wow wow wow, I don’t think this post is such a good idea outside of the message forum.

  3. 3
    The Tim says:

    Deejayoh, I agree, real estate isn’t the majority of the budget, but ChangMook Sohn’s warnings weren’t specific to real estate. Also, the housing boom had wide-ranging effects on not only real estate excise taxes, but property taxes and sales taxes as people withdrew money from the housing ATM to spend on retail goods.

    My main point is that overall revenue increased massively, self-balancing the budget, meanwhile, Mr. Sohn warned not to get spend-happy, and yet that’s exactly what happened.

  4. 4
    singliac says:

    I agree that the claims are bogus, but would Dino Rossi say anything different? He’s a real estate investor himself, so I’d imagine he was a bubble denier as well. Neither candidate earns much respect from me on this issue.

  5. 5
    John says:

    The reality is that politicians have less effect on the economy than we give them credit/blame for. She over saw a boom and bust and is trying to take credit for the good and pass the blame for the bad. Standard operating procedure for any politician regardless of party. Rossi has the benefit of being the non-incumbent in a period of backlash against incumbents. I predicted that Gregiore would lose months ago and I think if roles were reversed (Rossi winning in 04 and Gregiore rechallenging in 08), Gregiore would win this year.

  6. 6
    vboring says:

    closer to home, King County is planning on nearly $15M worth of layoffs and wage freezes due to budget deficits:

  7. 7
    Jana says:

    John: It’s highly unlikely we’d have seen the same degree of spending increases under Rossi. The current backlash is against Republicans, not just incubents. That’s why it is so interesting that Rossi is as strong as he is in this profoundly anti-GOP year.

    singliac: Whether he’d be a “denier” or not is immaterial. The spending is the issue at hand.

  8. 8
    Cascadian says:

    Yeah, Rossi’s a creature of the construction industry, so if anything he would be even less prepared to deal with our current economic situation. His transportation plan shows that he’s not capable of presenting an honest budget. He wants to build more and claims it will cost less, which means that if he actually went through with those plans the expense would vastly outstrip his estimates. If you want fiscal discipline, Democrats are historically a better bet, and Gregoire comes from that tradition even if the bubble took her by surprise.

  9. 9
    James says:

    Seattle Bubble just went off the rails.

    Surely you’re not shocked by a politician claiming credit for economic conditions that they had no part in causing? Candidates of ANY political party would do the same. The only question is, would you call them ALL out on it?

    Do us all a favor and stay on topic. Form another blog for your libertarian rants.

  10. 10
    David McManus says:

    It’s his blog. I think The Tim can do whatever the heck he pleases. If you disagree, get your own.

  11. 11
    AndyC says:

    Cascadian @ 8

    Can you provide ANY example of Gregoire using fiscal restraint? The fact is, she increased the budget by a record amount at a near record rate.

  12. 12
    The Tim says:

    For those of you that think this has nothing to do with housing, I invite you to consider the following quotes from ChangMook Sohn:

    September 2005:

    “The housing market has been extremely strong,” Sohn said. “Almost 50 percent of the new revenue we are expecting this time, close to $500 million, is directly or indirectly related to the housing (and) construction markets.”

    June 2006:

    Sohn said the state isn’t expected to dip into a recession, but that signs of a slowdown are on the horizon.

    “We can’t assume that this hot economy can continue into the next biennium,” he told the forecast council, a bipartisan panel of legislative and administration financial experts. “My worry is that even this number could be too optimistic.”

    His biggest concern is that the state’s recent economic and revenue expansion has been heavily dependent on a single sector of the economy, the construction and housing industry.

    That sector accounts for about 7 percent of the overall state jobs, but the construction and housing surge in recent years has accounted for 20 percent of the job growth, he said.

    That’s not sustainable and the number will surely drop back to more usual numbers, he said.

    “As housing goes, so goes the economy,” Sohn said. “That is why we are cautious and worried at this time.”

  13. 13
    jon says:

    Because people were spending their equity loans, just about all the major sources of state revenue will be affected: sales, gas, B&O. The property tax is probably comparatively stable, since prices have only dropped 10%, whereas the equity that drives a lot of the other spending dropped by a larger percentage.

  14. 14
    Yesler Hill says:

    Oh, I don’t think gregoire is any great shakes, not all. But, Rossi is at least as much of lap dog as Gregoire. Rossi likes to sit on developers and RE investors laps.

    neither of them is worthy of my vote; but since the November ballot in WA state is now rigged to excluded non-Democrats and non-Republicans (this is the first time since 1889 that there are NO non-Dems/non-Reps on state and Congressional ballots in November), what am I to do? I sure don’t want Rossi hacking back minimum wage and other social safety net mechanisms as the economy drops away in to the ditch. *sigh*

  15. 15
    masaba says:

    I don’t see how Gregoire’s claims are any more dumbfounding than Rossi’s. In fact, her first claim that she balanced the budget is true; and if she is re-elected and able to make cuts that bring down the projected deficit, then she can make that claim again. Of course, you’re right, it will be quite a bit tougher with the current economic outlook.

    However, stating that we should lower the minimum wage by $1.50 when the economy is turning south and executives at AIG are taking $400,000 vacations does seem a little dumbfounding.

    But, like people have stated before, it’s either door A or door B in this election; which is why it will probably be just as close as last time.

  16. 16
    The Tim says:

    Yesler Hill (and masaba),

    I’m curious what you’re basing the belief that Rossi will “hack back minimum wage” on. However, that’s off-topic for this post, so I’m starting a forum thread to discuss the topic. Please head over there and fill me in. Thanks!

  17. 17
    Ubersalad, Ph.D says:

    Any time you raise questions on existing condition involving politics, you are attacking incumbent (citing John on #5). This opens the flood gate and risk turning this blog into a political rant, and very well alienate many of your readers.

    Please do not venture down this path, it is not worth it and will cause this blog to deviate from its purpose.

  18. 18
    The Tim says:


    I’ve been following housing’s boom to the state budget for over three years now. The state budget has always been a subject of interest on this blog, so I fail to see how this post is too far off-topic to be of interest.

    Believe me, I didn’t want to get political, but Gregoire’s ridiculous claims that she is some sort of budget hero when in fact just the opposite is true were too much for me to ignore. Had she just let it be I wouldn’t have bothered bringing it up, but after watching this mess unfold over the last three years, I just couldn’t let that nonsense fly.

  19. 19
    Slumlord says:

    Neither candidate has been forthright. Rossi has it easy because he has not had any responsibility other than taking money from the building industry for the last 4 years. Meanwhile, Gregoire has been trying to shape reality through proclamation. I plan to vote for Gregoire, but I really with I was voting for ChangMook Sohn.

  20. 20
    Scotsman says:

    Tim, you misogynist, racist, heartless, and yes, probably selfish realist. How dare you suggest Queen Gregoire is anything less than God’s gift to WA. state? How dare you have a brain…… and use it!

    Personally, I’m voting for every socialist I can, knowing that eventually such a system will collapse under it’s own weight, and then we can start over again. Might as well hasten the process.

    And besides, last ad I heard said the budget was still balanced, because Christine (now Chris) has created a rainy-day fund. So there!

  21. 21
    The Tim says:


    …but I really wish I was voting for ChangMook Sohn.

    The really sad thing is that ChangMook Sohn resigned from his 24-year post as the chief economist to run for State Treasurer, and then came in a distant 3rd place in the August top-two primary.

  22. 22
    Ubersalad, Ph.D says:

    You can’t attack Gregoire without analyzing Rossi. I guess for this thread to seem less of a political rant, you should present both sides in a single post along with all the facts checked.

  23. 23
    The Tim says:


    I’m not sure what the “other side” would be here. Rossi hasn’t been the one running the state budget for the last four years, so how would I compare him in that respect? As I said, I’m not trying to tell people how to vote, I’m just detailing what I know from following this since 2005, which is ChangMook Sohn’s warnings and the state budget.

  24. 24

    Every time the economy does well, the incumbent running for re-election takes credit for it, and every time the economy does poorly, the incumbent gets blamed for it.
    Sure, Gregoire is making preposterous claims, but would any incumbent do otherwise?

    Also, just to invite a lynching here;

    If the economy is doing poorly, doesn’t it make sense to increase spending rather than cut the budget? Seems to me that in a poor economy the needs are greater, so maybe the politicians shouldn’t be so willing to throw out money when times are good, and more willing to spend money when times are bad.

  25. 25
    Scotsman says:

    Didn’t state government expand something like 33% in four years with “Chris” at the helm?

    I want to know what I got for my money. Traffic still sucks, DSHS is still being sued for millions and screwing up every chance it gets, my taxes are higher, more companies have moved out of state, the voting system is still corrupt without state standards, unemployment is up, blah, blah, blah…. Unbelievable. And all the opposition wants to talk about is how Rossi is “a lap dog for the contracting industry.

    Seattle/KC/ much of WA is as dysfunctional as it gets. Collapse is on the way.

  26. 26
    dw says:

    Personally, I can’t support Rossi, since he views my employer, a certain large research university that may or may not be located on Montlake Ave, with incredible contempt. Given that certain university is now driving the SLU biotech boom and directly/indirectly responsible for as many as 20% of the jobs inside the Seattle city limits, it’s clear he’d rather let that go to seed than use it to help power the state through the recession to come.

    That said, Gregoire has been pretty indifferent to said university and has never been willing to carry the water for it at the legislative level.

    And while I agree with what The Tim is saying in terms of her being blind to the economic realities of the bubble, I also think she did a pretty good job reining in the legislative Democrats when it came to spending, repeatedly turning back their demands to spend, spend, spend. Had she let them go we would be in a deficit right now rather than next biennium.

    One other thing, too, that worries me about Rossi is his deep connections to the BIAW, an organization that used its political clout to build build build throughout this boom, and now that some of these houses they threw up are being shown as shoddy they’re using that clout to shield themselves from liability.

    Gregoire has been mediocre, but right now I’m more inclined to four more years of meh than four years of damaging our economic engine in the name of adhering to some conservative talking points.

  27. 27
    uptown says:

    Wasn’t Rossi the one who designed the budget with a $2.2 billion projected deficit for 2005-2007?

    If so many in this state weren’t always intent on cutting taxes, it would be easier to keep rainy day funds; or use the good years to fund infrastructure improvements. Ain’t no such thing as a free lunch, folks.

  28. 28
    The Tim says:

    uptown @ 27,

    From the Seattle Times:

    As for that deficit: When lawmakers left Olympia in 2003, the immediate budget was balanced. Rossi left the Legislature to run for governor.

    In January 2004, officials predicted the next two-year budget – the one Gregoire ended up writing – would start off with a shortfall of about $1.06 billion.

    Deficit projections went up and down before Gregoire proposed her 2005 budget. At one point, the deficit was pegged at about $2.2 billion. But after that, the state got a surge of tax money. State documents say the Legislature dealt with a deficit of about $1.8 billion.

  29. 29

    ..And with the “top two” primary we have now, there won’t be any oddball fringe candidates on the ballot in November? Am I wrong?
    I won’t get to vote for the Anarchist Vegetarian Party candidate?

  30. 30
    uptown says:

    Two-year state tax revenues increased $5.3 billion between 2005 and 2007

    But now you’re all worried about the 2009-2011 budget. Do you really believe the economy won’t recover by 2010? Of course the Gov has already taken care of half that projected deficit, but you don’t mention that. You also don’t mention that spending has increased within historical norms.

  31. 31
    Slumlord says:


    I saw ChangMook Sohn giving a presentation on government access TV several years ago. I learned tons and now view him as a role model for all public servants. Sadly, his speaking style has a very limited appeal (probably just weirdos like me) and there is little chance for him to have a political career without an image makeover.

  32. 32
    The Tim says:


    The top-two applies to everything but the presidential candidates. On the presidential ballot in Washington state, you’ll get to pick between the following:

    • Barack Obama / Joe Biden
      Democratic Party
    • John McCain / Sarah Palin
      Republican Party
    • Ralph Nader / Matt Gonzalez
    • Gloria La Riva / Eugene Puryear
      Socialism & Liberation Party
    • James E. Harris / Alyson Kennedy
      Socialist Workers Party
    • Bob Barr / Wayne A. Root
      Libertarian Party
    • Chuck Baldwin / Darrell L. Castle
      Constitution Party
    • Cynthia McKinney / Rosa Clemente
      Green Party
  33. 33
    Silver9 says:

    Two things:
    If you didnt want Gregoire to increase spending, why would it matter to you if she has to cut it now? You seem to be complaining about both the increases and cuts…

    What was the spending increases spent on? Can you provide some graphs on what increased and where the money went? This is the kind of issue where the details really matter.

  34. 34
    Harley Lever says:

    The Tim,

    Perhaps your next post should talk about what W. has said and the true realities. Your finger tips would bleed and you would be left with stumps trying to capture all of his blatant lies.

    One good lesson might be never believe what any politician tells you. THEY ALL TALK OUT OF BOTH SIDES OF THEIR MOUTH.

    Unfortunately this can of worms is now open, good luck eating it.

  35. 35
    The Tim says:

    uptown @ 30,

    Of course the Gov has already taken care of half that projected deficit, but you don’t mention that.

    Sorry for not being super-impressed that she managed to fix half of the problem she created.

    Silver9 @ 33,

    1) I’m not complaining about the cuts, just pointing out that they wouldn’t have been necessary if we had not grown state government so rapidly during the boom.
    2) All that information is available in the Times story I linked in the post: How state spending rose $8 billion under Gregoire

    Harley @ 34,

    I don’t see what George Bush has to do with local real estate. As I said in comments #12 & #18 above, the state budget has always been a subject of interest on Seattle Bubble. That “can of worms” was opened in September 2005.

  36. 36
    uptown says:

    My last comment on the subject…from the The Olympian (Oct 12)

    When revenues began to slide, Gregoire, like any good manager, took immediate steps. She imposed a state hiring freeze, limited consulting contracts and discontinued unnecessary travel. Coupled with 1 percent across- the-board spending cuts, Gregoire says she has already taken steps to trim the projected $3.2 billion deficit by $1.5 billion. And let’s not forget Gregoire balanced a budget with a $2.2 billion deficit when she took office after beating Rossi by 133 votes in 2004. She created the rainy-day fund and has been a solid steward of state resources.

  37. 37
    AndyC says:

    uptown @ 30:

    From 1993 to 2004 the budget increased by an average of a little over 4% per year.
    From 2005 to 2008 it increased at about 7.75% per year.
    From 1981 to 1992 it increased at about 9% per year.

    I personally would appreciate a budget increase closer to that of inflation (ie 4%) than what we’ve seen of late.


  38. 38
    mikal says:

    Man, just when I was really starting to take some of Tim’s comments seriously he rants about Gregoire. You discount others opinions to readily if they disagree with you. Balancing a government budget can’t be easy. You could say you saw all this coming, but unless yoy know the exact date it happens the government can’t be prepared for it. What is expected one year to the next changes quickly, but that budget has to be in on time or everything shuts down. That said, I find it amazing that she was able to take care of more than half of it so quickly and, it seems, easily. Yet Tim suggests that it wasn’t a big deal to do that and that it was her own problem. Didn’t the legislature have any say in that. I’m sure my commments that don’t agree with Tim’s will be readily put down. I will not vote for Rossi again as he is definitely a buffon and stooge to the bulding associations that helped over build this mess. How can anyone suggest that W. didn’t have anything to do with the loan scams that have gone on the last eight years. You know, the Alta and subprime loans that used to be regulated. And some of you suggest I drink the Kool Aide. Be careful, this is new territory. You won’t like what you find and get.

  39. 39
    AndyC says:

    uptown @36:

    Did you just use a newspapers endorsement piece from the opinion section to support your argument?

  40. 40
    The Tim says:

    mikal @ 38,

    Be careful, this is new territory. You won’t like what you find and get.

    Again, how is this new? Here is an example of some previous posts on Seattle Bubble (which was started in August 2005):

    Here’s a quote from my September 2006 post on the subject:

    Mr. Sohn has been has been warning for a good while now that the pleasant budget picture is unlikely to continue once the housing market in the state really slows down. One would hope that those in Olympia are listening, but personally I’m not going to hold my breath.

    So would anyone care to explain how this is somehow a new and dangerous subject for Seattle Bubble?

  41. 41
    patient says:

    I find both Gregoire and Rossi revolting. Is it so hard for a decent candidate to make it? However, this is what really gets to me:

    “I’m struggling to get the message out to Washingtonians. The economy is strong. Buy your home. There is no good reason for a slowing of home purchasing in the state of Washington today.”

    How much clearer can you be in expressing that you don’t care about the residents. All you care about is to be able to show a balanced budget. Shameful.

  42. 42
    david losh says:

    In my opinion today was important in terms of Real Estate pricing and values. Europe has pledge dollars, $2.3 trillion dollars to shore up and buy interests in banks.
    It seems to me this was a big step in shoring up property values more than anything else.

    The governor spent money? Shocking!
    Is there still a deficit or a surplus?

  43. 43
    mikal says:

    You say that you don’t want to make it political, but your comments clearly are.

  44. 44
    patient says:

    At this point it should be known by all parties that over valued real estate is poison to the personal, business, state, national and world economy. Me think that real-estate values will not be “shored up” in a very, very long time if ever again.

  45. 45

    “I find both Gregoire and Rossi revolting. ”

    Me too. One’s a sleazebag and one’s a liar. And there’s no third party in the Guv’s race.

    Can anyone name me one elected official( statewide or countywide, not citywide) of either party who has not been a cheerleader for the real estate industry?

  46. 46
    Arno says:

    Even more basic is that Gregoire never balanced the budget, by any REASONABLE ACCOUNTING STANDARDS. Take a look at the historical Washington state debt tables. The total debt never went down under Gregoire, and therefore, there was never a surplus.

  47. 47
    Dan says:

    Yeah, Gregoire could have done a lot better with the budget. It’s pretty disgusting. But has anyone read Rossi’s transportation plan?

    It seems like his plan, which of course takes money from education and public transit, would have devastating consequences for the budget.

    As a former developer, he’s never seen a road plan he doesn’t like. Not to defend Gregoire here, but I think Rossi will be much worse for the budget. In exchange we’ll get a bunch of roads that will be just as crowded in 10 years, and no long-term solution. Anyone who’s ever been to LA knows that building more lanes won’t fix your traffic problems.

  48. 48
    deejayoh says:

    On a lighter note, I see that Tim’s stealth campaign is picking up steam…

    Whole video is here

  49. 49
    Harley Lever says:

    The Tim @ 35,

    You cannot be serious?!?!?

    GW and the Fed set interest rates, regulates and/or deregulates the banking industry, and sets government policies.

    This might help you remember.

    ” The goal is, everybody who wants to own a home has got a shot at doing so. The problem is we have what we call a homeownership gap in America. Three-quarters of Anglos own their homes, and yet less than 50 percent of African Americans and Hispanics own homes. That ownership gap signals that something might be wrong in the land of plenty. And we need to do something about it.

    We are here in Washington, D.C. to address problems. So I’ve set this goal for the country. We want 5.5 million more homeowners by 2010 — million more minority homeowners by 2010. (Applause.) Five-and-a-half million families by 2010 will own a home. That is our goal. It is a realistic goal. But it’s going to mean we’re going to have to work hard to achieve the goal, all of us. And by all of us, I mean not only the federal government, but the private sector, as well. ”

    George W Bush June 18, 2002.


  50. 50
    Harley Lever says:

    Oops sorry for the double post. For some reason there was a delay in posting.

  51. 51
    WestSideBilly says:

    Ira @ 45: I was going to say one is a liar and one is incompetent, but after some thought I realized that both statements apply to both of them.

  52. 52
    Herman says:

    Tim – some stat rules for you. You can’t say it went up 33% from 4.5% to 6.0%. It is proper to say it went up 1.5%.

  53. 53
    Angie says:

    DJO, nice detective work. That explains the fundraising and Losh’s recent obsession as Election Day nears–clearly he’s the campaign manager.

    I’m just waiting to see an accompanying website like Yes We Can (Hold Babies), though in this case it might be more like Yes We Can (Ride Pink Ponies).

  54. 54
    greenthum says:

    Our illegitimate governor had her chance and she blew it. It’s Rossi’s turn now.

  55. 55
    Bbraddock says:

    Just reading this post just ruined my day. I’m a huge fan of this site, Tim, but Ubersalad and James are right. Your anti-Gregoire statements are remarkably odd and out of place in the context of this site. And not to mention unfair considering the alternative. Dino Rossi, whose background is in commercial real estate, represents the very pro-corporate, deregulative forces that got us in this mess. Can you imagine how much worse off we’d be with if he were in office? Of course you’re right. He wasn’t. He didn’t have to manage the economic realities of our financial meltdown. Then again, even the best of our national or corporate leadership hasn’t had any luck with the task either.

    For what it’s worth, Gregoire’s done nothing but stand up for the rights of Washington’s citizens, fight for the protection of abused children, walked the walk in supporting teachers, reducing class size, and preserving opportunities for all to get a college education. She’s also helped provide healthcare for 73,000 low income children in our state. If your going to be critical of an incumbent governor three weeks before an election, be fair and at least tell the whole story of her contributions.

    Oh, and to the poster who said that this is Tim’s site and “he can do whatever he pleases…if you disagree, get your own” — all I can say is wow! I guess that dissenting opinions should just “love it or leave it.” I assure you that this unfortunate approach to pubic discourse would leave any modern website with a readership of about three people.

  56. 56
    WestSideBilly says:

    I don’t see Tim advocating we all vote for Dino Rossi.

  57. 57
    casey1167 says:

    Bbraddock – deregulative forces that got us in this mess????? Are you sure you have any understanding of the issues at hand?

    But I am glad Gregoire has saved the seals, and not thrown the low income children out on the street like that evil Rossi wants to do.

  58. 58
    Silver9 says:

    Thanks for the article Tim. I dont know much about Rossi or Gregoire and reading the linked article helped me,

    “State workers, she said, also went too long without raises and needed to catch up. Plus the state had to start putting more money into its employee pension system.

    But the governor and Democratic-controlled Legislature did not stop there. They also expanded programs, started new ones and said they wanted to spend even more in the future, including paid family leave, a sales-tax credit for low-income families, and increased access to health care for children.”

    Based on the article the problem is education, roads and those greedy kids and their health care…

    State government is a business with a very inconsistent revenue stream. States around the country always struggle with this and 14 are currently unable to meet their existing financial obligations.

    If the govt was a regular business, it would sock away cash in the good years to spend in the bad years but politics always intervene. In the bad years we cut spending and in the good years there is pressure to “give back the money to the people that earned it” as Rossi argues.

    People talk about “business” but they dont want to run the state government like a business or with common sense. Instead you get what you can when you can and vote the person out when times are hard. I guess we get what we deserve.

  59. 59
    PastorBlastor says:

    The financial integrity of any State closely follows construction and real estate. The problem is that where these go so does the economy of a State. If you have low construction or high real estate costs in a State, or both, the State will suffer tax-wise. Gregoire and Washington State Democrats also were part and parcel of raising taxes in sectors that affected the common working person which helped create the funding problems the State will face and is facing. Higher gas taxes, real estate taxes, fees, services, license fees and taxes, permits, and the encouragement of raising each of these by the Counties and cities of the State. What have Democrats like Gregoire done? Nothing. When the economy was surging they jumped on the tax wagon and now we the citizen will face huge deficits and a larger burden. Local communities will face uphill struggles to get funding for schools, police, and fire departments, roads and infrastructure. It is tijme the voter said a loud “NO!” to these tax and spending politicos like Gregoire by voting them out of office. Also, never forget, she won by using voter fraud and groups like ACORN to get those extra dead votes.

  60. 60
    PastorBlastor says:

    By the way, if you forget that it was Democrats in Congress that created the financial mess then you should not be allowed to vote. President Clinton himself agreed that they created the mess by deregulating Fannie Mae and Freddie Mac during his administration. Both McCain and Bush tried to get legislation passed to regulate them again and warned Congress about the problems deregulation would create but were voted down.

    To get the economy heated up the Fed was encouraged to lower the interest rate charged banks as well. They did. It gave people the ability to buy cars and charge things at lower rates. And, to get lower interest rates on homes. But when that interest rate went up to “cool” the economy, so did many of the credit card rates as did mortgages based on adjustable rates or open mortgages.

    While President Bush’s “goal” was that every American be able to buy a house, he did not want it done with the total disregard of good sound financial practices of lending. Congress passed laws deregulating the institutions that were supposed to make sure people could pay their loans back: Fannie Mae and Freddie Mac told banks to lend the money out to anyone. When people got loans they could never pay for, they walked away from them. When they did, their neighborhoods suffered, the housing market went south, and tax revenue tanked. People moved and businesses suffered. Banks now held loans that were worthless and owed money to the Federal Government that could not be paid back. The solution? Get the Government to bail us all out. In the long run this makes the tax burden on those of us who pay taxes much worse.

    What also heightened and contributed to the problems we are facing now are higher energy prices that affected everyone, including all businesses. Higher energy prices caused higher costs for everything people buy or manufacture.

    The other “problem” no one wants to mention is the fact that Unions, who jumped on the surge in the economy, wanted higher wages and benefits. They went on strike thereby have killed Boeing, the auto industry, and manufacturing.

    Real estate is a key in understanding all of this because when people do well, or are lead to believe they are doing or have a right to buy anything anytime, they usually go for the “security” of buying a home. In this case, it was a propped up proposition because it was all based on false mandated assumptions.

  61. 61

    Pastor Blaster,
    While I personally dislike both Gregoire and Rossi, to blame the democrats and the unions for the mess we’re in really turns a blind eye toward reality…Who has been the strongest advocates for deregulation over the years? Sure, the Dems were part of that, Clinton included, but who’s been leading the deregulation choir? The Republicans, and they have been for years. They’re not innocent here, not the saints you make them out to be.
    And some of the problems Boeing has had is because of quality control related to subcontracting work to other countries.
    It’s easy to blame ” the unions” rather than the corrupt, greedy CEOs, but just think of who each is supposed to be accountable to. The unions are accountable to the workers. They don’t always do a good job of representing them, and sometimes it appears that they are only accountable to themselves, just as the CEO’s are accountable to the shareholders( not the workers or the public) but also sometimes seem to only represent themselves.
    If it weren’t for the unions, people would be working 12 hour days, six days a week, there would be no minimum wage ( wages in general would be far lower), and 9 year olds would be working in sweatshops.

  62. 62

    I am curious as to how many government jobs Gregoire added to state government during her term. Adding thousands of jobs, that do not add any economic viability, certainly contributes to our out of control spending in Olympia.

    She can’t blame these on Washington DC.

  63. 63
    WestSideBilly says:

    To add to what Ira posted:

    The deregulation legislation Clinton passed was all done by a GOP controlled Congress, and the regulation Bush wanted enacted could have easily been rammed down the Democrats throats by the GOP controlled Congress under 43. Congressional Democrats certainly didn’t help matters, but sticking this mess on the minority party for 12 of the last 13 years is dubious at best.

    Blaming unions indicates a poor understanding of the dynamics of those industries. Boeing is doing quite well (for now) despite the “Union’s” best intentions. The auto industry buried themselves by being complicit with the UAW and giving out ludicrous lifetime benefit plans (pensions) in exchange for lower wages at the time. 4 decades of increased productivity (reduced labor needs) has created a situation where their worker:retiree ratio is so out of whack that it’s untenable. As much as I loathe UAW, it’s hard to fault them for the executive management’s complete lack of foresight.

    General manufacturing has gone overseas because it’s cheaper. It’s cheaper than the cheapest non-union shop anywhere in the US. Nobody in this country can compete with somewhere that has no labor laws, no environmental or safety regulations, and nominal wages far below our minimum wage. And since Americans have shown a steadfast refusal to pay more for “made in America” companies did what needed to be done.

    The world is not black and white.

  64. 64
    DaveP says:

    Sweet topic. I appreciate that Tim called it as he saw it.

    Personally I think it fits the theme of RE + fiscal responsibility. It did not seem partisan imho.

  65. 65
    The Tim says:

    Mark Schwartz @ 62,

    Here’s what a July Seattle Times article has to say on that subject:

    The governor’s budget office projects that by next year, state government will have added more than 6,100 employees since Gregoire was elected in 2004.

    That’s an increase of nearly 6 percent. By comparison, after Gary Locke was elected governor in 1996, the state hired more than 8,400 employees during his first term — a 9 percent increase.

  66. 66
    mydquin says:

    Doesn’t Rossi have a legislative record? I am clueless about it.

    I do know that Rossi’s former employer, Capretto & Clark, was not exactly a shining beacon of honest real estate development. It is sort of surprising that Rossi remained so close to his boss until he decided to go into politics.

  67. 67
    Cyan says:

    Can you guys please date and source your graphs? thanks

  68. 68
    Peter says:

    This post was on fire back in October, now it’s November and suddenly we’ve got a $5B deficit. You got to love how this information became available two weeks after the election. We’re being played.

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