Gov. Mark Warner persuaded Virginia Republicans to raise taxes. His successor tried and failed.Opinion Journal, Wall Street Journal
BY FRED BARNES Thursday, June 29, 2006 12:01 a.m. EDT
ALEXANDRIA, Va.--Tim Kaine, Virginia's popular new Democratic governor, called for a tax increase. The Republican-controlled state Senate voted in favor of a tax hike and forced a three-month budget impasse in hopes of getting its way. Even much of the business community, especially politically influential developers in northern Virginia plumping for road and transportation funds, sought to raise taxes. Most of the big newspapers argued for higher taxes.
And yet, Virginia did not raise taxes: The Legislature produced a political surprise last week. Thanks to a recalcitrant House of Delegates, led by Speaker Bill Howell, it gave up on a $1 billion a year tax increase over two years--which had been proposed despite a projected budget surplus of $1.5 billion. And that increase would have come on top of a tax boost of $2.8 billion in 2004 under the previous governor, Democrat Mark Warner.
Mr. Warner had promised not to raise taxes during his 2001 gubernatorial campaign, but still managed to woo enough Republican legislators to win approval of his tax hike. Soon after it passed, state officials disclosed a budget surplus that nearly matched the amount the increase was projected to raise. Nonetheless, the tax issue made Mr. Warner a national figure as a Democrat who could persuade a Republican Legislature to increase taxes. Indeed, he is now exploring a bid for the Democratic presidential nomination in 2008.
Mr. Kaine, too, vowed in his campaign he wouldn't raise taxes. Four days before his election last November, he told an interviewer: "I'm not going to be in for tax increases because we did it in 2004 and we're going to have to live within our means." Six days after he was inaugurated in January, he abruptly changed his tune, announcing a plan to raise "modest, reliable revenues" of $1 billion to fund urgently needed transportation improvements.
To the obvious question--why not tap the surplus in general revenues to pay for transportation?--came the answer: No, that was strictly for education, health care and other nontransportation uses. The money would have to come from the separate transportation fund, which needed replenishing.
This was a not-so-clever dodge. General funds, according to Speaker Howell, are regularly used for transportation. "That's absolutely true," noted Larry Sabato of the University of Virginia, the state's leading expert on policy and politics. These revenues, for instance, paid for Highway 58 along the state border with North Carolina. So that argument fizzled.
Still, the Senate Republicans, more liberal than their House counterparts, were already on board with Mr. Kaine's tax hike. The chairman of the Senate Finance Committee, John Chichester, actually favored an even larger tax increase than Mr. Kaine advocated. Another senator, Russell Potts, had signed a pledge not to support any tax increase, but he too was allied with Mr. Kaine.
The problem, then, was convincing the House of Delegates. Using funds from his political action committee, Mr. Kaine mounted a broad multimedia campaign--radio, direct mail, phone banks--on behalf of his tax proposal. In radio ads, he complained his "long-term statewide solution" to traffic congestion and "out-of-control development" was being blocked by House Republicans. "I need your help," he pleaded. "Urge your delegate to get moving." But the ads flopped. Not a single Republican delegate sided with Mr. Kaine.
The problem for Mr. Kaine on the House side was simple, Mr. Howell said. "Fool me once and it's your fault," he said. "Fool me twice and it's my fault." In 2004, 17 Republican delegates had broken ranks and voted for Mr. Warner's tax increase. This prompted a backlash among conservative voters, particularly after the bulging surplus was disclosed. Every one of the 14 Republican tax-hikers who returned to the house after last fall's election learned the lesson and stuck closely with Mr. Howell this time around. They unswervingly opposed the governor.
Mr. Kaine lacked the political skills that Mr. Warner had deployed in attracting Republican support. Mr. Warner, a cell-phone mogul in Alexandria before winning the governorship, often ate lunch with Republican delegates. He invited them to dinner. He occasionally played basketball with them. Mr. Kaine is a bit stiffer and less social than Mr. Warner, and certainly not as politically adept...
There's a final lesson, a hardy perennial: Never trust a candidate who promises not to raise taxes. Mr. Sabato moderated a campaign debate in which, he said, "we asked [Mr. Kaine] three different ways if he would raise taxes. The answers were no, no, no." Mr. Kaine might have meant it at the time. But we now know, his promises weren't binding. Such promises rarely are.
Mr. Barnes, executive editor of The Weekly Standard, is author of "Rebel in Chief" (Crown Forum, 2006).