(I’m grateful to my fellow tech workers who provided support or provided feedback so far. Amongf the latter was that “total transparency” is important. So here are ~1,000 words to provide total transparency on why I’m starting Tech4Recovery. This was revised on May 1 thanks to awesome guidance from folks who’ve already been working on progressive taxes.
To join in the call to #TaxUsNow, please use this form.)
Last year more than 60,000 households in Seattle earned over $200,000, and at least that many more in the rest of King County.
Tech jobs are not the sole source of affluence here, but they play a big part.
You blow past that at a senior level. The most junior person I hired in the last decade made $100,000 plus bonus and stock.
As massive as the income and wealth flowing into our city, county, and state as “tech worker compensation” was prior to the coronavirus crisis, afterward it will be even bigger.
“Digital transformation” is what big companies call initiatives like adopting cloud computing, enabling more online collaboration, doing ecommerce, or using machine learning to grow their business.
Corporate chief financial officers (CFOs) considering budget cuts in response to coronavirus rank capital and operating expenditures and workforce reduction much higher than digital transformation as targets to defer or cut, according to survey results released recently.
If you’re not in tech, your CFO is more likely than not to lay you off rather than crimp plans to pay companies like mine, or (almost certainly) some combination of Amazon, Microsoft, and Google more money.
That’s because “getting more digital” is vital to survival and bounceback for most big companies. Scaling remote work, doing more business on the Internet, preparing for the next pandemic, or all three–most roads lead to “more tech.”
The crisis has accelerated digital transformation–specifically, adoption of technologies powered by workers here in Washington.
Amazon, Microsoft, and Google are the top public cloud providers. The latter two lead in online collaboration tools. And of course Amazon is number one in ecommerce.
This isn’t speculation. Knowing the implications of this crisis is part of my job. I have researchers in the field now interviewing Fortune 500 executives.
So while some tech workers and tech companies will suffer negative economic impacts, on balance, tech comp will flow on amidst the financial desperation that many others are experiencing.
As we come out of this crisis, tech jobs and compensation will grow faster than most.
Imagine a future in which this income and wealth rolls past our neighbors struggling to get back on their feet without making any direct contribution to public investment in recovery for all.
The thought shocks my conscience.
Now imagine a present in which raising billions either solely or close to solely from tech workers like me (or others who, for whatever reason, are also doing well financially) is possible.
That’s where we stand today.
You may have heard that the state constitution only allows for a single tax rate applied to all income (a “flat” rather than “progressive” tax).
What it in fact demands is “uniformity.” The ins and outs of the law are such that economist Dick Conway figured out that a (legal) flat rate statewide income tax with a $15,000 deductible could raise enough to replace most taxes–including sales and property taxes.
That means you’d get to keep all the sales or property tax you paid last year. And the lowest income households wouldn’t pay a dime.
It’s a bold plan. I think it’s brilliant. I’d support it.
If that feels too radical, there are other taxes that could contribute toward public investment in recovery that could raise more than $3B annually, exclusively from those of us doing very well indeed.
The State Legislature could enact any or all of these to accelerate recovery. Or they could empower cities and counties to act.
State and local government can provide direct assistance to households making up to 80 percent of median income (for comparison, in Seattle that’s $61,800 annually for a single person, $88,250 for a family of four). They could all be made whole (or better off) with grants for food, housing, or transportation.
It’s legal to use Federal funds to help folks who earn more. The State Legislature and our Congressional representatives should go on a full-court press to make it possible to (say) insulate households making less than $100,000 per year from new taxes.
The elephant in the room is that the constraint that “income is property” rests on a thin reed–the 1933 Washington Supreme Court decision that declared this leans on U.S. Supreme Court decisions that have since been overturned. Treating income as its own category would allow a straight-up progressive tax.
Neither I nor most of my colleagues will be the best experts on taxation or spokespeople for communities most in need.
But we can invest in amplifying those voices.
We can organize to hold elected officials accountable and support those who do the right thing.
We can bear witness to both the stunning disparity of fortune between us and “most folks” and the shocking disparity between “most folks” and those most impacted by coronavirus, who also have the most to lose from an inequitable recovery.
This is why I am starting Tech4Recovery.
If you’re in tech, I invite you to join in, tell your story, and co-create something good.
If you’re not, we’ll welcome guidance. Can you teach us about taxes? Point us to key issues or potential partners for making recovery faster, fairer, and more just? Or tell your story about why taxing us is necessary and urgent?
I’ll close with a statement from an expert who studies crises:
“Disasters tend to make structural failures and long-running structural inequalities glaringly obvious. They force them to a crisis point. And ideally these terrible events then force people to reckon with ongoing problems that have been ignored by those in power.”Mar Hicks, PhD, in the MIT Technology Review
Let’s fight for the ideal case. How could we sleep at night if we don’t?
I am a technology executive, musician, and Fair Housing advocate. Tech4Recovery is a personal project, not affiliated with my employer or any other company; opinions are my own.