WHEN THE Great Recession began in December 2007, Gig Harbor did the sensible thing and tightened the city’s budget. As a result, the city is in a solid position for economic recovery. While the budget belt is still tight, the line on operating expenditures has been held this year, and that means improved projected ending fund balances for 2011.

It’s a lesson state lawmakers should take to heart as they deal with the Great Recession and its aftermath. As of Monday, the Legislature — under orders from Gov. Chris Gregoire — convened a month-long special session to deal with what is becoming an annual tradition: a budget shortfall. To be more precise, legislators face a $1.4 billion difference in revenue versus what they want to spend.

With the prospect of a major economic recovery fading, it’s especially important that state leaders get a handle on producing a sustainable budget that includes prioritized and restrained spending.

“The good times aren’t coming back,” state Rep. Larry Seaquist, D-Gig Harbor, told us earlier this month, predicting a decade or more of a “fluttering economy” and “low growth.”

People need to be educated on the budget, he said, and realize that state government must be realigned so that it’s trimmer.

We agree, given the often erroneous impression from the mainstream media and politicians in Olympia about all the budget “cuts” that have been made over the years. (Politicians often define a “cut” as a decrease in the projected rate of increased spending.) The truth is, total state spending is still increasing.

Some perspective is needed. In spite of the revenue forecast earlier this month that showed a $122 million drop in projected receipts, revenue for the 2011-13 biennium is still projected to increase 7 percent — about $2 billion — over the current 2009-11 biennium. The state’s own budget page (fiscal.wa.gov/budgets.aspx) shows that the total enacted 2011 supplemental budget is $70.9 billion and the enacted 2011-13 budget is $74 billion — an increase of more than $3 billion.

Rather than do the hard work of ranking the importance and effectiveness of state programs in the past several years and spending accordingly, Olympia has chosen a tax-and-spend course of action.

The Legislature approved billions in new taxes and fees in 2009 and 2010 — raising the business and occupation tax, cigarette tax, real estate excise tax and the carbonated beverage tax (which voters later repealed). The tax and fee increase for the 2009-11 biennium totaled more than $1.6 billion.

Of course, the Legislature may find it more difficult to raise taxes now, thanks to Initiative 1053, which was approved by voters last year and requires a super-majority vote of both houses, or a simple majority vote of the people to hike taxes.

Still, that hasn’t stopped state leaders from trying. Last week, Gregoire proposed an $830 million tax package, including a one-half of 1 percent temporary increase in the state sales tax. It would give Washington the second-highest sales tax in the nation, right behind the economic basket case that is California. She also proposed a “windfall profits tax” on oil companies and financial institutions, as well as a 5 percent “luxury tax” on vehicle purchases greater than $50,000.

To be fair to legislators, cutting spending won’t be easy. Every dime of state spending makes some built-in constituency happy. Especially during fiscally dire economic times, each constituency vehemently opposes losing their share of public funding. One person’s wasteful government program is another’s sacred cow.

The good news is the state has wiped out a budget shortfall before — without increasing taxes. Back in 2002, Gov. Gary Locke initiated the Priorities of Government project, a budget approach that focused on clear goal-setting and results. POG was put to good use in dealing with a projected $2.65 billion deficit for the 2003 state budget. Locke and then-state Sen. Dino Rossi worked together, using POG, to close the budget gap without raising taxes.

But the program only works if it’s actually implemented. Just something for the Legislature to consider during its special session.