Virginia Club for Growth

Phillip Rodokanakis



Surplus? What Surplus?

You'd think tax advocates would be embarrassed by the state's impending $1 billion budget surplus. Not so. Won't last, says Mark Warner. Still need to raise taxes, says John Chichester.


 

After being handed a serious defeat on Election Day Gov. Mark R. Warner has retreated to his comfort zone of predicting a fiscal catastrophe. (In case you had forgotten, Mark Warner had promised the Kerry campaign that Virginia’s electoral votes were in the bag for the Democrats.) This time, however, the calamity is projected to hit our state in the years following Warner’s departure from office.

 

An article published in The Washington Post on November 6, 2004, outlined the Governor’s new dire predictions of fiscal disaster, which are to follow a record of huge budget surpluses. In outbursts reminiscent of Chicken Little’s “the sky is falling” parody, Warner is predicting serious budgetary shortfalls for the rest of the decade.

 

Worried that legislative action could balloon the deficit to nearly $1 billion, Warner insisted that in the 2005 session the General Assembly must hold the line on new spending. Even if lawmakers don't go on a new spending spree, he still foresees budget shortfalls to the tune of $250 million for 2007 and $31 million for 2008.

 

Warner must think that the citizens of our Commonwealth are suffering from a collective memory loss. This is the same governor who predicted earlier this year a biennial budgetary shortfall of $1.5 billion and then proposed a $1 billion tax increase.

 

A number of groups, including the Virginia Club for Growth, insisted that Warner’s tax increase was totally unnecessary. But Warner had a number of willing accomplices in the state Senate who went out of their way to enact the largest tax increase in the history of Virginia.

 

Senate Finance Committee Chairman John Chichester, R-Fredericksburg, a proponent of massive tax increases, along with a bunch of other tax and spend liberals in the state Senate cornered the House of Delegates into enacting a huge tax increase. In retrospect, the tax increase was not needed.

 

Right after the new taxes were enacted, but before the new tax revenues started to roll in, the state had already amassed a $324 million surplus. This led a number of observers to conclude that Warner and his administration intentionally underreported the projected tax revenues to General Assembly members to give them cover for – some would say to coerce them into – enacting the tax increase.

 

The new tax revenues are now flooding the Virginia Treasury; recent projections call for the surplus to go as high a $1 billion. So much for Warner’s imaginary budgetary shortfall and other dire predictions that culminated in a $1.3 billion tax increase this biennium.

 

But Warner has consistently gone out of his way to misrepresent the facts or outright lie to his constituents. After all, this is the same Mark Warner who in his 2001 gubernatorial campaign categorically stated that he will not raise our taxes. He even accosted his opponent for daring to suggest that he would raise taxes.

 

Within his first year in office Warner was campaigning in support of the Sales Tax Referendum – a 22 percent increase in the sales tax for residents of Northern Virginia and Hampton Roads.

 

The same year he went on a campaign across the state claiming that he had cut $6 billion – yes that’s billion with a “b” – from the state’s budget and had eliminated more than 3,700 employees from the government’s payrolls. The fact is that government spending increased by $2.5 billion in the first two years of Warner’s tenure. So much for truth in governance!

 

When in 2004 the governor proposed massive tax increases, a friendly and cooperating press never bothered to question him why any tax increases were necessary given his reported budget cuts. Nor did the press make an issue of his campaign promise not to raise taxes. Warner just told them that circumstances had changed and everyone was happy to look the other way.

 

But the Warner Administration’s many lies don’t stop here. In April 2004, the Fairfax County Taxpayer Alliance prepared a flyer for the Finance Committee of the House of Delegates documenting the numerous misconceptions about the Virginia state budget that had been propagated by Warner, his administration, and their willing accomplices.

 

Joseph Goebbels, the Nazi minister of propaganda, said that “it is the absolute right of the State to supervise the formation of public opinion.” Given the fact that Gov. Warner continues to enjoy high job approval ratings – irrespective  of his many half-truths, lies, and distortions – a disinterested observer is left with only one possible conclusion: Our governor has elevated the art of propaganda to a new level.

 

In the same Washington Post article, the Speaker of the House of Delegates, William Howell, R- Fredericksburg, was quoted saying that the House would have to hold the line on new spending. Howell said that Del. Vince Callahan, R-McLean, chairman of the House Appropriation Committee, and Sen. Chichester will have to convince the legislators “to hold true to principles.”

 

Excuse me for pointing out that the emperor has no clothes! Howell is placing his confidence on the same guys that saddled us with a massive tax increase this year.

 

Chichester wasn’t happy with Warner’s $1 billion tax hike proposal and counter-proposed a $3 billion increase. As to Callahan, he borrowed a page from John Kerry’s operations manual – he voted for the tax increase before voting against it.

 

I do not mean to open old wounds, but it was the total collapse of the House Republican leadership that led to the unprecedented tax increase this year. Howell’s latest comments should not give comfort to anyone; he only reinforces the notion that there is no plan in place to stave off another assault from the tax and spend legislative contingent. As a matter of fact, Chichester has already gone on record saying that we need to raise new taxes for such things as transportation and infrastructure investments.

 

Abraham Lincoln said “You may fool all the people some of the time, you can even fool some of the people all of the time, but you cannot fool all of the people all the time.” So far our governor and his willing accomplices in the General Assembly seem to be getting away with fooling all the people all the time!

-- November 15, 2004

 

 

 

 

 

 

 

 

 

 

 

 

 

Phillip Rodokanakis, a Certified Fraud Examiner, lives in Oak Hill. He is the managing partner of U.S. Data Forensics, LLC, a company specializing in Computer Forensics, Fraud Investigations, and Litigation Support. He is also the Vice President of the Virginia Club for Growth.

 

He can be reached by e-mail at phil_r@cox.net.

 


 

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