McDonnell sees fat in VDOT, Medicaid

The Republican candidate for Virginia governor says that if elected he will look for budget cuts within the Transportation Department and the state’s Medicaid agency even as he explores ways to cut corporate taxes to attract business.

With the governor’s race attracting nationwide attention, former Virginia Attorney General Robert F. McDonnell told editors and reporters at The Washington Times that Republicans need to rebrand themselves and that education reform should emerge as the party’s signature issue at the state level.

“I’m trying during this campaign to help to rebrand our party as the party of positive, happy, friendly, conservative leadership that’s pro-growth, pro-free enterprise, pro-economic development. And that’s really what we stand for,” Mr. McDonnell said.

• On ideas for reform Republicans can rally around, similar to welfare reform of the 1990s:

Mr. McDonnell also promised to overhaul Virginia’s education system, even proposing to send state monitors into failing schools.

The candidate also discussed his race against state Sen. R. Creigh Deeds, one of two gubernatorial contests in the country this year and one in which he expects to face the full power of the national Democratic Party.

“There’s going to be George Soros money and Hollywood-elite money coming in, and the president sent out an e-mail for my opponent yesterday,” he said. He added that Mr. Deeds’ victory over former Democratic National Committee Chairman Terry McAuliffe - who raised millions of dollars from wealthy Democratic donors across the nation and drew celebrities to campaign with him - was proof that the governor’s race will be decided by issues that are “all about Virginia.”

• On lowering taxes:

“My view of how you keep a strong state is, I guess, reasonably elementary,” he said. “If you keep taxation, regulation, litigation to a minimum, if you keep strong right-to-work laws and great universities, you’re going to have the foundation for a good free-enterprise system where the private sector can grow.”

Mr. McDonnell said Virginia can’t rely on its pro-business reputation but must create additional corporate incentives such as linking tax cuts to job creation.

Looking at a $300 million budget shortfall announced this week for the fiscal year that concludes at the end of June, Mr. McDonnell said state government needs to curb overspending. He pointed to a restructuring that his department underwent when he was attorney general, noting that he and several members of his staff took pay cuts and the department renegotiated contracts. Such cost-saving measures can be duplicated across the state, he said.

He also pointed to the Virginia Department of Transportation (VDOT) and the Department of Medical Assistance Services, which provides a wide range of medical-assistance programs to the underprivileged and was the fastest-growing department in the state budget.

“Those agencies are the ones I see where there is an opportunity for significant savings,” he said.

Mr. McDonnell had harsh words for state Republican leaders, who he said have allowed themselves to be characterized by Democrats as obstructionists, and national party leaders, who he said have done a poor job in recent years articulating the party’s core values.

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