Today's Seattle Times letters column starts off with the reaction to Bruce Ramsey's editorial against the state-mandated unemployment insurance program last week. Of course, most of the letters are boilerplate screeching and whining about how insensitive Ramsey is for suggesting alternatives. One of the letters stands out, however, because it explains why (in exquisite detail) the current system is seriously broken.
Bruce Ramsey's piece on the Washington unemployment-insurance program brought back vivid memories of my experience with the system. In the mid-1990s, after paying into the system for about 12 or so years without ever having a claim, I had to lay off an employee for the first time. The following year, my unemployment tax bill increased 889 percent — to nearly 10 times what it had been. When I complained, I was told, basically, "Too bad, that's how the system works."
It gets worse. By the time I worked my way back down to the basic rate again, the state had recovered every dollar in benefits paid in higher taxes plus at least another 60 percent. I would have literally been money ahead to pay the benefits out-of-pocket myself.
To add insult to injury, shortly after I complained, I was visited by a state auditor, who wanted to see my payroll records. If an insurance company operated in this manner, it would be hounded out of the state by the Washington State Department of Insurance. When the state does it, however, there's no recourse. It's little wonder that Washington is considered one of the [worst] states in the country in which to do business.
There are times when the Employment Security Department acts appropriately, such as when benefits are denied to an individual who was justifiably terminated for cause. However, the system is fundamentally flawed and is badly in need of an overhaul.
- Jim Sullivan, Renton
Appearing on the same page is a guest column from the leaders of two business associations. They point out a few startling facts about the current administration of Gary Locke, Washington's governor. Among the highlights:
-Since December 2000, Washington state has lost 96,000 private sector jobs.
-During the same period, Washington has added 12,000 new state employees, with an average salary of $53,000/year. Meanwhile, Washington state is running a $2.9 Billion deficit.
-Taxes for the state-run worker's comp program increased by 29% last year.
-Locke signed an expensive ergonomics law, one that is even more restrictive than OSHA's ambitious plan, killed by congress two years ago. Washington state businesses are paying $725 million per year to comply with these regulations.
It's no wonder that businesses are reluctant to begin operations in the state, and long-time regional employers are pulling up their stakes and moving elsewhere (Boeing, anyone?).