Reset 2010: Statewide initiatives tackle taxes, taxes and drink

GOVERNMENT at all levels needs to reset itself — to adjust its size and cost downward, to relieve pressure on the shrunken private economy. Three Washington ballot measures, two good and one bad, stand out immediately as relevant to that theme:

Initiative 1098, the state income tax, runs counter to the idea of government adjusting its appetites downward. It takes current government programs as given and seeks to maintain them by adjusting taxes upward.

I-1098 also takes away the most important tax-based advantage Washington has in attracting business and jobs here: our lack of a state income tax. This state needs that advantage, and should reject I-1098.

Initiative 1053, which would restore the two-thirds requirement for the Legislature to raise taxes, has the opposite effect. It restrains government.

A two-thirds requirement was in effect in 2009, and the Legislature did not raise taxes. But under the state constitution, the Legislature may suspend any initiative after two years by majority vote. In January they did, and raised taxes by more than $800 million.

I-1053 would force the Legislature to find ways other than simply raising taxes to adjust to the state's economic realities.

Initiative 1100, to end the state liquor monopoly, is a smaller thing than the other two measures, but is important symbolically. Resetting government implies that certain activities might be ended entirely — and liquor retailing is the most obvious one.

I-1100 replaces all the revenue the liquor monopoly earns for the state and will lower prices besides. Privatization can do this because it is eliminating not only the monopoly power of the state but the associated state jobs and rules that benefit a handful of privileged private wholesalers.

Two initiatives offer to privatize liquor. The other one would retain key privileges for the private wholesalers. I-1100, backed by Costco, is a clean break with the monopoly system. It is the one in the interests of consumers, and that would truly help create a government for the 21st century.