Tim Eyman, who was convicted last year of over 100 campaign finance violations and banned from handling the money for political committees, is back out collecting signatures.
This time he is teaming up with far-right state Rep. Jim Walsh (R-Aberdeen, last seen wearing a Star of David patch while comparing vaccine passports to the Holocaust) on Initiative 1408, a frankenstein mish-mash of dead legislation from the state’s most tight-fisted fiscal conservatives. The initiative would prohibit the state, counties, and cities from imposing or collecting taxes based on personal income, and repeal a tax on certain sales of long-term capital assets. In effect, this would end the capital gains tax and Seattle’s JumpStart payroll tax, the biggest progressive-tax wins in recent history.
Democrats and progressive activists are terrified. The Republicans and a handful of conserative Democrats narrowly failed to tank the capital gains tax in the Legislature last session, and concerned venture capitalists are trying to take it down in court, but progressives are so worried about this threat from Eyman that they’ve decided to launch a new PAC, For Our Kids: Parents and Teachers Standing Up To Tim Eyman. The PAC is heavily financed by eat-the-rich billionaire Nick Hanauer, and reports $1 million in total pledges so far.
In a meeting broadcast Wednesday afternoon on Facebook live, Treasure Mackley, a spokesperson for the PAC’s campaign, Invest in WA Now, explained the reason for the collective freak-out:
Here's what we know – we know that Tim Eyman, for the last 20 years, has been able to put things on the ballot; and he has been able to gut funding for education and healthcare and all sorts of things time and time again. So we have to take this seriously… And so we're launching right now because we're not going to give them an inch. We're not going to give them an inch.
“My students, you know, some of them don't see their parents at night because they work two or three jobs to afford health care and electricity. And they don't understand why people like Tim Eyman want to take even more away from them at school,” said Renton teacher Julianna Dauble during the livestream. “And I don't get it either. Unless we look to greed.”
Eyman is infamous for promoting $30 car tabs to a tax-averse Washington. King County Executive Dow Constantine warned that even though “it’s easy to make fun of him… we must take Tim Eyman’s threats seriously.” Eyman’s website boasts saving taxpayers and costing state programs nearly $47 billion since 1999. His next target, the capital gains tax, skims 7% from capital gains transactions in excess of $250,000 — affecting about 0.1% of Washingtonians – to raise an estimated half a billion per year for childcare, early learning, and schools.
Earlier this year, a ruling from the Thurston County Superior Court Judge James Dixon barred the serial campaign finance law violator from handling money of any political committee, but Eyman can still do what he does best: collect signatures. When asked how he will make this issue as notorious as his car-tabs crusade, Eyman said the opposition is doing the work for him.
Speakers at the Facebook live event said Eyman’s name at least 19 times, according to the transcript. Walsh, who wrote the initiative, was only mentioned twice. Walsh said the initiative started off as an experiment, but Eyman’s support has helped it catch on.
Eyman is a menace to those in favor of using the government to help people, but the threat here goes much deeper than one man.
The mobilization around the initiative in combination with an ongoing lawsuit to strike down the tax set off alarm bells for progressives. In their view, this push to kill the capital gains tax is not just extreme characters such as Walsh and Eyman simply rolling through the motions to fire up the base, but rather an organized, united front from Washington’s moneyed conservatives, according to a Democratic operative close to the action.
Walsh said that aside from obvious promotional skills, Eyman brings resources and financial backers. Some of that financial backing appears to connect this initiative with more mainstream Washington conservatives at the Washington Policy Center.
Matt McIlwain, a venture capitalist who sits on the board of directors for the Washington Policy Center, is an outspoken critic of the tax. He founded the Opportunity for All Coalition when he and former Washington Attorney General Rob McKenna mounted a successful legal challenge to an income tax in Seattle in 2017. The pair are spearheading one of two attempts to fight off the recent statewide capital gains tax.
In July, Ken Petereson, a venture capitalist in Vancouver and former board member of the Washington Policy Center, gave Eyman’s PAC, Permanent Offense, $25,000 according to the Public Disclosure Commission.
Washington Policy Center president Dann Mead Smith said, "Tim Eyman has no connection to Washington Policy Center. Whatever he does in his ballot initiatives, we have nothing to do with it." He added that he might put forth a similar initiative to the people if Walsh's initiative to the Legislature fails.
The conservatives associated with the Washington Policy Center “are just like Tim Eyman, but in nicer suits,” the democratic insider told The Stranger.
“It's abundantly clear that this is it, the fight is on,” the insider added. “I-1408, led by Tim Eyman and Jim Walsh is going to be the vehicle that all these super rich people try and use to repeal the capital gains tax.”
Walsh, while happy to have Eyman on the team, said that the Democrats “aren’t afraid of Tim, they’re afraid of the policy.”
“We can be all wonky, we can talk about tax fairness, but this is an absolute, true, time-tested element of Washington politics,” Walsh said. “In this state, people don't like a state income tax.”
The capital gains tax is not an income tax, according to UW law professor Hugh Spitzer, but, regardless, there is real anti-tax sentiment in Washington state. In 2010, 64% of voters rejected an initiative to establish a state income tax. Two years later, Eyman’s I-1185, which required either two-thirds legislative approval or a vote by the people in order to raise taxes, would pass by a similarly large margin, but was later overturned.
Walsh said the initiative is in a bit of a time-crunch. Because it is an initiative to the Legislature, proponents will have to get all their signatures before the start of the next session in January. If the initiative makes it to the Legislature, lawmakers will either adopt the proposal, modify it, or else ignore it, which would effectively send it to the ballot in 2022.
