RICHMOND, VA –– Tonight Delegate David B. Albo (R-Fairfax), Chairman of the House Courts of Justice Committee, and Senate Republican Caucus Chairman Stephen D. Newman (R-Lynchburg) offered the Republican perspective on the 2009 State of the Commonwealth following Governor Kaine’s address to a Joint Assembly of the Virginia House of Delegates and Senate of Virginia. Their remarks are as follows:
Delegate Albo:
Good evening, I’m Delegate Dave Albo from Fairfax County. Tonight, Senate Republican Caucus Chairman Steve Newman from Lynchburg and I are speaking to you on behalf of our fellow Republican legislators.
Every member of the General Assembly – regardless of party – is fully aware of the tremendous challenges facing our Commonwealth. As we speak to you tonight, there are too many Virginia families confronting an uncertain future. All of us, even those like me who have a job, are wondering what the future holds and, in the backs of our minds, are – quite frankly – scared.
When times are tough, Virginians expect their elected officials to address difficult problems. Steve, myself, and all Republican lawmakers are prepared to work across party lines, and we have a principled plan to guide our Commonwealth through this current downturn.
Our goal is to have Virginia lead the way out of recession and toward a robust recovery, laying the groundwork for long-term prosperity.
Let’s start with our current difficult budget situation. I know you hear about a “budget shortfall” every couple of years. Usually, that means the state does not have as much money as it thought it would. It usually does not mean that we have less than last year, just not as much as hoped.
This year is very different. Because of the housing slump, job losses, and reductions in consumer spending, Virginia is receiving less in real estate tax, income tax, and sales tax revenues. The Commonwealth will have much less than it had last year.
Just like my family – and perhaps yours – has had to do this year, government must make do with less.
In a budget shortfall, there are basically two solutions: (A) Raise Taxes or (B) Cut Spending.
Let’s examine both. (A) Raise taxes.
When I was an economics major at the University of Virginia, I learned you cannot tax your way out of a recession. While my professors explained it in a much more erudite way, it is most simply stated as follows: Most of the U.S. economy is driven by consumer spending. And when government makes people pay higher taxes, they have less money. With less money, they buy less, and when they buy less, recessions get worse.
Now, let’s look at option (B) Cut Spending.
According to the National Association of State Budget Officers, Virginia is one of the top five states in spending growth over the last decade. Our budget has more than doubled, handily outpacing population and inflation.
There are things in the budget that can be cut. Each has a constituency. But in recessions, we have to restrict spending to core government responsibilities. Only by standing up and making these tough decisions can we ensure that difficult times are brief and economic recoveries long-lasting.
For example, earmarks. In recessions, we just cannot fund non-core government projects. Republicans have pledged to end earmarks at the state level, guaranteeing a pork-free budget.
When Governor Kaine unveiled his budget changes in December 2008, his message ran 4,670 words. The word “efficiency” was mentioned just once. Missing entirely from that address were the words “streamline” or “consolidate,” “public-private partnership” or “reform.”
In making his cuts, Governor Kaine did make some tough choices, and I applaud him for his effort. However, in some cases, his priorities for cuts are not ours.
For example, Governor Kaine claims he’s going to release only “non-violent” prisoners three months early. As Chairman of the Courts of Justice Committee, I read the fine print. His proposal makes drug dealers and gang members eligible for early release. That’s wrong. We shouldn’t balance the budget by giving gang members and drug dealers an early out. We abolished parole in 1994 to make Virginians safer. Even in a recession, these types of criminals should never get a break in the name of saving some money.
But all is not doom and gloom. Let’s talk about some positive initiatives that you will see this year from Republicans.
In my district, transportation is a critical issue. Congestion affects the quality of life for many in our region, and improving roads, rail, and transit is vital to ensuring prosperity across Virginia. Key aspects of our earlier transportation plans are bringing much-needed improvements this year. This session, we will unveil legislation to provide hundreds-of-millions in new, sustainable revenues to further address Virginia’s transportation needs.
To ensure affordable energy, we will introduce a proposal to allow energy exploration off Virginia’s coast. And, we will dedicate any revenues from such activities to transportation and restoring the Chesapeake Bay.
We also are supporting a groundbreaking proposal by the Tobacco Commission that dedicates $100 million for research and development of alternative energy in Virginia. Partnering with our research universities and the private sector, this plan will create new jobs, spur economic growth, and place Virginia further on the path to energy independence.
You have every right to expect your public servants to behave in an ethical and appropriate manner. A decade ago, Republicans successfully fought to restrict all elected state government officials from accepting campaign contributions while the General Assembly is in session. Because some have disappointingly found ways to circumvent those restrictions, we are offering measures to strengthen them.
Of course, Virginia’s current fiscal situation means that most of the news from Richmond this session will revolve around the budget. Senator Newman has some added perspective for you on that issue.
Steve…
Senator Newman:
Thank you Dave, for setting forth clearly where we stand tonight. Let me take it a step further.
Back home in Lynchburg our families have been especially hard hit. Layoffs in the financial sector and in manufacturing have touched neighborhoods and neighbors. The pain that some only read about or see on television is felt personally by my friends, constituents, and I’m sure someone close to you. During these tough times policy makers should wake up each morning, and ask themselves what they can do to make matters better, not worse.
For instance, do we want to impose new taxes on some Virginians and not others as the administration has proposed tonight? Or do we want government as a whole to learn to live within its means, just like working families?
There are many improvements we can make in state government. Let’s start, for instance, in our revenue forecasting. The problems that beset us today are not entirely a result of our national economic situation. We could have taken preventive measures in the last General Assembly session.
As a matter of fact, last year the Senate Republican leaders warned the Administration over and over again that its revenue projections in last year’s budget were not realistic. Our conviction was so strong that every one of my Republican Senate colleagues voted against the budget in 2008. We were sure that the economy could not grow at 5.2% in the first year and 6.7% this year. Had a more sober approach been taken then, our Rainy Day Fund would be full, not on the verge of depletion. Unfortunately, these warnings were ignored and the cuts needed today are much, much deeper than they would have been if we had used a more conservative fiscal approach.
In January 2009, it appears to be déjà vu all over again. Once again the estimates appear to be inflated, so the headlines in February are likely to read “More Cuts Needed to Balance Virginia’s Budget.”
Why do we take the budget estimates so seriously? Well, it’s because it affects Virginians on a daily basis. Our schools and roads, law enforcement, nursing homes and mental health facilities, are all affected by choices we make and budgets we pass.
It is often said that after Virginia governors send their budgets to the legislature, a whole new set of eyes scrutinize it and improve upon it. This year, more than ever, we must work in a bipartisan manner to fix the budget problem, and do it based on realistic budget estimates.
While the budget writing committees will work hard in the coming weeks, all members will consider a host of other legislative actions that must focus on making government work better.
The economic turndown facing the nation and the Commonwealth will in many ways reset our national and state priorities. Will it be for higher taxes and more regulation? Or will we look for more efficiency in government, expanded economic opportunities, and greater personal freedom?
We understand that the hidden cost state government places on working families do not always appear in the form of tax increases. It often comes as new unreasonable regulation that leads to layoffs, unemployment, and deeper recessions. This year, the House and Senate, Republicans and Democrats need to work together and avoid such legislation to help our economy recover.
When it comes to healthcare, we all know that the costs have risen above inflation and many families and small businesses are finding it harder and harder to pay their premiums tonight. The 2009 General Assembly must keep healthcare costs from rising, and there are at least two ways to do it. First, some of our Democratic friends are looking to increase the cost of prescription drugs this year. They want to increase the amount of litigation on these products, and even extend the amount of time to file new and expensive lawsuits. The net result would be higher prices on much-needed medicine for Virginians.
Next, a leader on the other side wants to increase the cost of health care again by increasing the cost of medical malpractice insurance. Simply stated, this is a surefire way to increase the cost of health insurance. Doctors all over Virginia would be forced to pass these new attorneys’ fees directly to you and me, and our rural communities would lose even more family doctors and much needed medical specialists. Virginia, these are tough times, but we deserve better.
When it comes to energy, Republicans want to work with Democrats to keep the cost of heating oil, gasoline, and electricity down. Recessions are difficult enough without paying more for everything we need. We do want to make sure that our sources of energy are clean; we also want to make sure they are reliable and affordable. Specifically, we want to set aside over 25,000 acres of state land for renewable energy. And while you have heard from the Governor tonight about his desire to support green energy, his administration continues to stand in the way of private windmill farms that could help us with green energy. Next, we will support Senator Wagner’s reasonable bill to tap Virginia’s vast natural gas resources and return the royalties back to Virginia for transportation; this could represent billions for infrastructure needs.
And finally, speaking of energy, we Virginians have plenty of it. We are a resourceful people. We may need to draw down deeply on our talents and our blessings to face these days. But together, we will succeed and we will prosper.
Finally, on behalf of Delegate Albo and me, thank you for listening.
May God bless this nation, our commonwealth, your family and you. Good night.
