Sunday, February 8, 2004

Having watched virtually every initiative he put forward during his first two years as governor defeated in the General Assembly or at the ballot box, Democratic Gov. Mark Warner apparently thinks he’s been able to come up with a way to divide the Virginia Republican Party: by exploiting long-standing differences between pro-growth, anti-tax conservatives and Republican advocates of tax increases.

Mr. Warner, in the name of tax reform, has proposed a plan to increase taxes by approximately $1 billion over two years. And Sen. John Chichester, the Republican chairman of the Senate Finance Committee, has put forward a tax increase package that is more than twice the size of the governor’s. Mr. Chichester and Senate Republicans, who command a 24-16 majority in that chamber, will most likely be able to muster the votes to pass a tax increase on the people of Virginia.

The problem for the governor and his Senate allies is that Republicans in the House of Delegates, led by Speaker Bill Howell, are strongly and rightly opposed to the kind of broad-based tax increases favored by the governor and Mr. Chichester. Since last summer, Mr. Warner has skillfully waged a public relations campaign aimed at putting Republican critics of tax increases — particularly in the House of Delegates — on the defensive. It seems to have backfired.

Last month, Mr. Howell and another high-profile Republican opponent of the Warner tax increase, Attorney General Jerry Kilgore, asked former Reagan Office of Management and Budget chief James Miller to study the impact of the governor’s tax proposals. According to Mr. Miller, they would cost Virginia $10 billion and close to 28,000 jobs.

Armed with this data — and justifiable skepticism about tax increases in general — the House Finance Committee on Wednesday night rejected proposals to increase state sales, income, cigarette and gasoline taxes. (While the governor has not proposed raising the gasoline tax, he has said he would consider such an increase.) “The governor has gone to extraordinary lengths to get people to try to prop up his program, but it won’t have a whole lot of impact on the members,” Mr. Howell noted.

Following the debacle for his program in the House, Gov. Warner hopes to rally the troops with a pair of endorsements of higher taxes from prominent politicians long admired by many Virginia conservatives: Sen. John Warner and former Sen. Harry Byrd. But it is difficult to see how these endorsements will do much to help the governor. Mr. Byrd retired from the Senate more than 20 years ago. And Sen. Warner was among those elected officials who two years ago endorsed the governor’s transportation tax increase referenda, which lost by landslide margins. Unlike Sen. Warner, Virginia’s other Republican senator, George Allen, is opposing Gov. Warner’s efforts to raise taxes.

The danger down the road for House Republicans, as we see it, is a scenario in which the Senate passes Mr. Chichester’s $2.6 billion tax increase package, then tries to foist a “compromise” on the House, in which it agrees to swallow something very close to Mr. Warner’s $1 billion tax-increase. We trust that Mr. Howell and his fellow Republican conservatives in the House — who have done a superb job thus far in taking their case to the public — will not let that happen.

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