Taking cues from their leader to "LIBERATE" certain parts of the country from stay-at-home orders issued to save lives and the economy, the Washington State Republicans in Olympia released their 16-point "Safe Economic Restart Plan" last Friday. The plan, as you might expect, is profoundly dumb.
Before we talk about their call to re-open certain ill-defined business sectors, it's worth briefly running through their legislative plans to "help" small businesses by making life harder for people who shop at small businesses.
In general, as always, the Republicans want to cut taxes, defer all taxes, and forgive sales and business & occupation taxes for “small businesses,” though they don't define the term.
Since nearly 40% of state revenues come from sales and business & occupation taxes, losing revenue from the few admittedly bad and regressive taxes Washington collects would require lawmakers to dramatically cut billions of dollars in funding from health care, housing, and constitutionally protected education programs that are already severely underfunded. We know the state anticipates a massive hole in the budget this year, and each of the Republican proposals on the tax front would dig that hole deeper.
The GOP's proposal to waive the minimum wage increase next year would help retain some revenue, but it would also force low-income households to take a paycut right when businesses will be clamoring for patrons to spend more at their re-opened shops. All the evidence shows that higher minimum wages increase consumer spending and productivity, decrease poverty, and don't kill jobs. Why Republicans want to take money out of people's pockets right when small businesses will need them to spend it only makes sense if you want to exploit workers while killing small businesses statewide, which, now that I think about it, is pretty much the party's M.O.
Their push to exempt small businesses from paying sales tax and to defer those taxes for a year while also throwing big sales tax holidays doesn't make any sense, either. Small businesses collect sales taxes that consumers pay, and consumers are only going to buy so many pairs of pants or running shoes or fucking giant SUVs at a time. The prospect of paying slightly less in sales tax isn't going to do much. And while sales tax holidays sound nice, evidence shows they do nothing to spur economic growth. People with money might save a few bucks by waiting for holidays to make purchases, but if you're just a regular consumer trying to get by every day, that holiday isn't going to dramatically impact your behavior.
It's true that small businesses need help, but taxes on sales and gross receipts aren't the reason they're at risk right now. They're at risk because they have no cash flow, the rent is still due, and the federal government isn't doing nearly enough to pick up their part of the tab. Since states and cities must keep their books balanced, the federal government needs to put cash assistance, rent assistance, and a paycheck guarantee on the country's credit card, or else pay for it with a tax on the rich. After all, the Trump administration's slow and bungled response to this pandemic exacerbated the problem in the first place. It's on them secure these funds, and soon. But of course, Trump is deliberately withholding financial aid to states until they agree to re-open their economies against advice from public health experts, which makes this all the more difficult.
You will not be shocked to learn that the GOP plan for re-opening certain business sectors across the state is vague and strange. They think any businesses that meet "one or more" of the following criteria should be allowed to open ASAP: "low-risk, personal health, environmental protection, aid to elderly/physically challenged, alternate quarantine locations, assisting businesses with tax-related requirements, or property protection."
As examples, they cite "auto dealers, solo landscape services, car washes, remodeling companies/contractors, residential construction, hairdressers/barbers, flower shops, RV parks, dentists, installers of home/commercial security systems, and accountants/tax preparers.”
It might make sense to allow some of those businesses to re-open—car washes, I guess? And if wealthy residents in gated communities can't go another second without installing a security system in their McMansions, I suppose I'm comfortable allowing them to take the risk of inviting those workers into their homes.
But there are good reasons a lot of those businesses are on lockdown right now. Residential construction workers, for instance, find it very difficult to social distance when "multiple workers are typically crowded into unventilated rooms as small as 600 square feet." And though I'm sure I'm not the only person who desperately needs a hair cut, I'm not walking into Hair Masters tomorrow morning even if they do open up.
The fact is, everyone wants to re-open every business in the state, but we can't do that until we have mass testing, plenty of analysts, and good contact tracing processes. The reason we don't have those things at the moment is because the federal government—run by an asshole most of these Republicans voted for—did not take this pandemic seriously.
All of this does raise a good question, though: Sure, the Republican plan sucks. But what is the Democratic plan for re-opening the state? Looks like we'll find out at 5:00 p.m. this evening.