We're 'business-friendly' because we're worker-friendly

Credit and blame. That's what political folks fight over - who deserves which and who doesn't deserve any.

Witness what happened in July when Gov. Chris Gregoire's staffers pointed out that times are good in Washington. The state's economy is strong, job growth is steady, unemployment rates are at historic lows, businesses are profitable, state revenues are up without tax increases, and the nation is taking notice. In case you missed it, Washington jumped from 12th to 5th place in Forbes magazine's "best states to do business" ranking, and was the only state in the top five in the labor, regulatory environment and growth categories.

Well, the Governor's staff might as well have hung a "Kick Me" sign on their boss's back. Conservative columnists and bloggers pounced, accusing the governor of taking too much credit. It's funny how we expect our governor to be our state's marketer-in-chief and attract tourism, trade and economic development. But don't you dare bring any of that good news and sunny optimism home. Take it outside.

It goes without saying that neo-conservatives who criticize Gregoire would be giving the Governor complete credit, if it was Dino Rossi.

Instead of predictable political squabbling over who accomplished this, let's consider what accomplished this.

A few short years ago, it was fashionable among business lobbyists to declare - as former Boeing executive Alan Mulally infamously said - that "we suck." They said our state's highest-in-the-nation minimum wage, high unemployment benefits, high taxes and high workers' compensation costs were all, well, too high.

They advocated cutting all of those things. That, of course, would have meant taking money out of the pockets of struggling working families: people who earn the lowest legal wage, who lose their jobs through no fault of their own, who are seriously injured on the job, etc.

Thankfully, our leaders recognized that the struggling economy had little to do with state policies. The 9-11 attacks decimated the airplane market and Boeing shed tens of thousands of jobs. The dot-com bust hit our state disproportionately hard. The phony Enron energy crisis delivered a death blow to our aluminum industry.

Although legislators briefly slashed unemployment benefits in a panic over whether Boeing would build its new Dreamliner here, state officials generally chose to ride out the recession without unnecessarily harming working families. (With the support of Boeing, among others, most of those unemployment benefit cuts were quickly restored.)

That high-road strategy paid off.

Despite repeated dire predictions - which continue to this day - that our inflation-adjusted minimum wage is killing jobs, the reality is that these service-sector industries continue to thrive and add jobs. That's because those higher wages are spent in local communities, benefiting local businesses. One Clarkston pizza shop owner, who was previously the Association of Washington Business poster child for doomed Washington-Idaho border restaurateurs, told The New York Times this year: "To tell you the truth, my business is fantastic. I've never done as much business in my life."

As for unemployment benefits, the whole point is not just showing a little compassion for laid-off workers, but also sustaining local businesses in communities impacted by layoffs. The U.S. Department of Labor estimates that for every $1 of unemployment benefits, $2.15 of purchasing power is created in the economy. During the 2002 recession, $2 billion in state and federal benefits paid in Washington state created purchasing power on Main Street of $4.3 billion, keeping a significant number of small businesses afloat.

Yes, we offer better-than-average benefits to injured workers in this state. But thanks to a state-run workers' compensation system that is a national model, this year Gov. Gregoire was able to grant a "rate holiday," saving businesses and workers some $315 million in taxes.

And speaking of taxes, Roadmaster Inc., a Portland manufacturer of recreational vehicle accessories, this month moved its company and 300 jobs to Vancouver, Wa. The CEO says Washington's lower taxes were a big factor in the decision.

The truth is, one of the big reasons Washington's economy is thriving is because we have chosen to take the high road with policies that make our state attractive, not just for businesses, but for workers.

That's the best way to sustain our success, especially now, as we tackle our latest enviable problem: finding enough workers for all these jobs.

Rick Bender is President of the Washington State Labor Council, AFL-CIO, the largest labor organization in the state.


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