Seattle politicians must have finally cracked open an economics textbook – or maybe they came across a copy of Henry Hazlitt’s Economics in One Lesson. It has only been a month since progressives approved a contentious head tax of $275 per employee on businesses grossing $20 million a year. Colloquially known as the “Amazon Tax,” Seattle officials projected that the levy would raise $47 million to help the homeless and cover the cost of low-income housing.
It didn’t take too long for the socialists to backtrack. Amid fierce public backlash – from businesses and consumers alike – the City Council is now thinking about repealing the controversial levy.
Not only has a petition been successfully formed to qualify for a referendum on the jobs tax in November, the politicians who initially gave the nod to penalizing employers are considering a reversal.
‘We Heard You’
City Council President Bruce Harrell and a few of his colleagues want to eliminate the levy as quickly as possible. Harrell scheduled an abrupt special meeting to discuss a full repeal of the bill, which was originally approved 9-0. And it looks like he has the support from most of his colleagues, including the mayor.
In addition to Harrell, six other members of council agreed with Mayor Jenny Durkan on axing it.
“We heard you. This week, the City Council is moving forward with the consideration of legislation to repeal the current tax on large businesses to address the homelessness crisis,” they said in a statement.
In other words, Durkan and others feared for their political lives come 2019, when Seattle voters head to the polls.
Whatever the motive may be, Marilyn Strickland, who heads the Seattle Metro Chamber of Commerce, is breathing a sigh of relief:
“The announcement from Mayor Durkan and the City Council is the breath of fresh air Seattle needs. Repealing the tax on jobs gives our region the chance to address homelessness in a productive, focused and unified way.”
It should come as no surprise that Strickland is excited, especially after the findings of a new report were recently published. According to a study commissioned by the Chamber of Commerce, the head tax would have cost Seattle more than 14,000 jobs and roughly $3.5 billion in economic output. This isn’t anything to dismiss, particularly if Jeff Bezos is gradually making plans to abandon the sinking ship.
Despite the evidence, a couple of Marxists are not pleased. Two councilors stand by the war on jobs: Kshama Sawant, who called the recommended repeal a “backroom betrayal,” and Teresa Mosqueda, who says the city has too many people “dying on the doorsteps of prosperity.”
Lorena Gonzalez, another member of the council, confirmed that she will vote to overturn the legislation, but added that it is the business community’s fault for the current mess and misinformation.
“I am deeply troubled and disappointed by the political tactics utilized by a powerful faction of corporations that seem to prioritize corporations over people,” she noted in a news release.
A Blow for Progressivism
This is indeed a great blow to progressive activists on many fronts. First, Sawant and her ilk cannot stick it to entrepreneurs and successful enterprises. Second, the government will have less money to waste on the next leftist cause du jour. Third, several California politicians who thought about adopting a similar policy are unlikely to risk career suicide with such a ridiculous and unpopular levy.
It isn’t too often that a jurisdiction like Seattle can apply some common sense, but it did, and we should tip our hats. Perhaps basic economics will reign supreme after all.
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