Billionaire, union pledge $1 million to defend capital gains tax

But first, some really sad personal news

One of the most popular features of this newsletter has been the regular picture of our canine correspondent, a labrador retriever named Milo. With profound sadness, I must report Milo’s untimely death.

We adopted Milo last year knowing that he had epilepsy, a condition that the Woman Who Lets Me Live With Her has lived with since she was a teenager. Medication mostly controlled Milo’s epilepsy until Tuesday, when he suffered a massive series of seizures and died en route to the vet’s office.

I’ve lost dogs before, but they were old and no longer having fun. As Milo was just two, I was looking forward to a decade or more of ever-improving canine company as his youthful exuberance and sleek, muscular beauty gave way to mellow, gray-muzzled charm. The loss of those years cuts deep.

He was an excellent dog in every respect. May his afterlife be filled with well-thrown tennis balls, carelessly abandoned butter, and long snoozes on a celestial couch. Here’s one of the last pictures of him in his favorite habitat:

I’ll have more to say about Milo’s death over at Ragtop Dog, a never-really-launched side project I had intended to be a celebration of life with an awesome dog, but which is going to be something darker for a while.

It would be wrong to say that Milo would want me to get on with the actual political news because he would have wanted me to blow off the news and take him to the beach. But let us get on with it anyway.


Progressive billionaire Nick Hanauer and one of the state’s most politically active unions have pledged a combined $1 million to block Tim Eyman’s attempt to repeal the capital gains tax approved by the Legislature this year.

The pledges went to a new political action committee with the somewhat cumbersome name For Our Kids: Parents & Teachers Standing Up to Eyman, according to a filing with the Public Disclosure Commission. Eyman, whose formerly formidable anti-tax initiative machine has seen better days, has been openly shopping for rich guys of his own to pay for a signature drive for Initiative 1408, which would ban all taxes based on income.

It’s not clear that Eyman’s going to get the support that he needs to collect roughly 300,000 signatures by the end of the year. As we reported last month, he’s raked in a few big checks, but not nearly enough for a signature drive. Statewide initiative campaigns can run as high as $20 million, although Eyman has been successful spending less than a tenth of that.

If he does find the money and succeed, the measure would go before the Legislature next year. Lawmakers could pass it, put a competing measure on the ballot alongside it, or simply let it go to the ballot in the fall of 2022.

The initiative, originally sponsored by state Rep. Jim Walsh, R-Aberdeen, would very likely pass if it came before voters. Attempts to impose an income tax via ballot measure have gone down in flames multiple times over the years, most recently in 2010. While the capital gains tax is currently aimed at the mega-rich, voters would likely be persuaded by the argument that state government’s thirst for money would eventually lead to its broad expansion.

The money pledged by Hanauer and SEIU 775, a union representing long-term care workers, would likely be used for some kind of decline-to-sign campaign aimed at keeping the initiative off the ballot in the first place. Such campaigns are usually ineffective against well-funded, organized signature drives. But the pandemic has made signature-gathering both more difficult and much more expensive, which is why we have seen no viable initiative campaigns thus far this year.

As we’ve reported before, thousands of wealthy people have hundreds of millions of reasons to want to repeal the capital gains tax, which would take a 7 percent bite out of most capital gains over $250,000. But the cost-effectiveness of running a statewide ballot measure to achieve that goal probably pencils out for just a handful of the fattest of those cats. Thus far, their money is on the political sidelines as a court challenge to the tax plays out.

Standing up a PAC in opposition to Eyman is no doubt intended to signal that supporters of the tax will try to make repealing it really expensive. Other deep-pocketed players, like philanthropist Lisa Mennet and the powerful Washington Education Association, are no doubt waiting in the wings to chip in should the need arise.

Hanauer is one of the more vocal advocates for revamping Washington’s tax system, which falls heavily on the poor and lightly on the wealthy, especially the extremely wealthy like himself. He’s one of the millionaires and billionaires who, with labor unions such as the SEIU and the WEA, make up the financial backbone of Democratic politics in Washington.


Union money starts to fly for González in Seattle

The union-backed political committee backing Seattle City Council President Lorena Gonález’s bid for mayor has spent about $375,000 on local TV ads attacking former City Councilmember Bruce Harrell. The ads are slated to run through election day on KING, KIRO, and KOMO, according to the PAC’s filings with the Public Disclosure Commission.

The PAC, Essential Workers for Lorena, has raised more than $900,000 from a handful of politically active labor unions. The biggest contributor at $550,000, is UNITE HERE, a hospitality workers union with very few members here. As we reported earlier this year, that union is likely looking for a more favorable political environment to organize large hotels and restaurants.

In recent days, five different subdivisions of the Service Employees International Union have given another $150,000.

As we noted in our earlier story, González is benefitting from a change in campaign finance law, adopted by the city council at her behest, that effectively bans most corporate money from Seattle politics, while leaving unions free to contribute.

That hasn’t stopped the PAC behind Harrell from raising slightly more money, mostly in big chunks from wealthy individuals involved in commercial real estate in Seattle. Bruce Harrell for Seattle’s Future has raised more than $977,000 and has far more to spend because it spent sparingly as Harrell cruised through the primary. Absent that new law, their advantage would likely be far larger. Expect a similar ad blitz from Harrell’s side.


Campaign finance limits come off in Seattle mayor’s race

In related campaign finance news, Nick Bowman over at MyNorthwest.com had a story late last week on the Seattle Ethics and Elections Commission lifting the spending limit imposed on Gonález and Harrell by the city’s democracy voucher program.

In return for the right to collect the four $25 vouchers given to every Seattle voter, courtesy of the city’s taxpayers, mayoral candidates agree to an $800,000 spending limit. But if big independent expenditures get made in the race, candidates can petition Ethics and Elections to lift the caps so they can raise and spend money the old-fashioned way, in larger amounts from wealthier donors.

But here’s the thing: Literally everyone involved in this process knew there would be big independent spending in this race. So the original spending limit pledges were meaningless and mendacious, and one of the stated premises of the democracy voucher program — getting big money out of politics — completely falls apart.

The taxpayers’ tab for the democracy vouchers in the mayor’s race alone1 was $2.1 million. More than half that money went to the two final candidates who have million-dollar PACs behind them. As we’ve said before, it’s easy to look around the city and find better things to spend it on.


Sen. David Frockt won’t seek reelection

Seattle Democrat David Frockt announced Tuesday that he would not seek a fourth term in the state Senate next year. The Washington Wire was first with the news, including Frockt’s hilariously long news release. Frockt, the Democrats’ lead on the state capital budget, becomes the second Senate Democrat to announce a departure. Jeannie Darnielle of Tacoma resigned last month to take a job with the Department of Corrections.

Unlike Darnielle, Frockt did not resign his seat and says he plans to serve out the remainder of his term. That’s a mild violation of the norms of the Legislature, in which departing incumbents typically leave in the second half of the odd-numbered year so that an appointed successor has time to get established as an incumbent before the election.

Given the state of Seattle politics, it seems likely that Frockt, a staunch progressive, would have faced a viable, and deeply unpleasant, challenge from the left.


Still more irksome errata

In our piece on the 2011 redistricting process that led to the current map of congressional districts, we really fell victim to that whole trying-to-be-your-own editor thing.2 Among our blunders we:

  • Promoted Denny Heck from former House Majority Leader, a position he actually held back in the day, to former House Speaker.

  • Used a rhetorical time machine to place former U.S. Rep. Jim McDermott’s decision to retire in 2012 instead of 2016, when it really occurred.3

  • Referred to state Sen. Ron Muzzall, R-Oak Harbor, as Sen. Mark Muzzall.

1

The impact of democracy vouchers down the ballot is more interesting. Abolitionist Nicole Thomas-Kennedy’s run for city attorney would have been a non-starter without public financing, and Nikkita Oliver’s run for city council would have been far more difficult.

2

In related news, we’re in the market for a freelance editor with an encyclopedic knowledge of Washington politics over the last 30 years. Sadly, the person who did that for us back in the day retired several years ago to raise horses.

3

Psychologists probably have a name for misremembering a fact in such a way that it makes your story marginally more persuasive.