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For GOP, Taxes Retain Potency
In Governor's Race, Deeds's Foes Cite His Voting Record

By Rosalind S. Helderman
Washington Post Staff Writer
Sunday, June 28, 2009

Virginia Republicans, eager to rejuvenate their party, already are turning to an issue that has been one of their most reliable: taxes.

Within moments of state Sen. R. Creigh Deeds's victory speech June 9 after the Democratic primary for governor, the Republican National Committee sent a blast e-mail saying that Deeds had a history of raising taxes. The day after the election, the Republican Governors Association declared that Deeds's record on taxes made him "unelectable."

The strategy has not been particularly successful in Virginia in recent election cycles. Republicans claimed that Mark R. Warner and Timothy M. Kaine would raise taxes, and both Democrats won the governorship pretty handily.

But neither Warner nor Kaine had served in the General Assembly. With Deeds, Republicans have an opponent with an 18-year record in the state Senate and House of Delegates. That record includes votes on taxes and spending that have gridlocked Richmond in recent years.

This year's campaign is also being fought against the backdrop of a budget deficit and polls showing increasing anxiety nationally about rising government spending. The election also will come 10 months after President Obama, a Democrat, took office -- and Virginia, which elects a governor the year after presidential elections, has chosen a candidate from the opposite party than the one in the White House for the past 30 years.

"Obama seems to have a little bit of what [former president Ronald] Reagan had going for him, in that a lot of people like him personally even if they are unsure about his policies," said Frank Atkinson, a Republican lawyer and author of "The Dynamic Dominion," a book about Virginia politics. "To the extent that independent swing voters tend to want to check excess by the party in power, the excess they mainly want to check relates to economic issues, especially taxes, spending and debt."

The challenge for the Republican candidate, former attorney general Robert F. McDonnell, will be to paint Deeds as a reckless spender without making himself look like an extremist who would starve government services. McDonnell already has taken heat from the right for announcing that he does not intend to sign a pledge against raising taxes.

"We get so many requests for pledges to do this and that," McDonnell said in a recent interview. "I believe I'm going to say what I believe in, what I stand for, and then the voters will be able to determine what they think about that."

But, he added, "I think in a down economy like this, it's a very bad time to be levying more gas and sales tax on the hardworking citizens of Virginia."

Deeds, too, has said he does not intend to propose a tax increase. But he has promised to try to fix the state's roads and rails -- an issue often assumed to carry a $1 billion-a-year price tag -- in his first year in office.

McDonnell has already been pointing to Deeds's Senate voting record on transportation as proof that the Democrat would raise taxes.

For instance, since 2004, Deeds has supported five proposals that included some form of increase in the gas tax. Each was intended to raise money for transportation improvements, and each was blocked before final passage.

One of those bills would have raised that tax by 5 cents a gallon over five years -- it was proposed in 2008, when gas prices were rising. Another proposal from 2008 would have combined a boosted gas tax with a 25-cent increase in the sales tax and a 0.5 percent increase in the sales tax on cars.

"A lot of things have been tried," Deeds said recently. "I'm not going to wed myself to any single source of revenue. . . . I can tell you that I don't like to pay taxes any more than anybody does. But I also know that if we're going to live in a civilized society, we have to invest in our future."

Deeds has also voted against tax cuts. In 2003, he opposed a measure to eliminate Virginia's estate tax. That same year, McDonnell, then a member of the House of Delegates, sponsored a measure to end the tax on estates of the deceased. The proposal passed but was vetoed by then-governor Warner, who said the state budget could not take the hit. Deeds voted to sustain the veto. He also opposed a successful measure to repeal the estate tax in 2006.

But his record on the estate tax is nuanced. During the 2003 debate, Deeds proposed eliminating the estate tax for farms -- an idea rejected by Republicans who wanted the tax ended for all estates.

"They both wanted to cut the estate tax, but they wanted to do it in different ways," said Deeds's communications director, Mike Gehrke.

In 2004, Deeds was one of 31 Democrats and Republicans in the Senate to support a tax package initiated by Warner to boost spending on education, health and public safety. McDonnell voted against the tax increases in the House.

The vote has become a clear dividing line between conservative Republicans and Democrats. For Democrats, it represented a bipartisan decision to use taxes to right troubled state finances and make record investments in core government services. For Republicans who were opposed, it was the largest tax increase in state history -- including a 27.5-cent increase in the cigarette tax and a half-penny increase in the sales tax.

In recent elections, Virginians have seemed to indicate that they are untroubled by the tax increase. Last year, voters overwhelmingly chose Warner over former governor James S. Gilmore III for the U.S. Senate. Warner has already campaigned with Deeds to say that he would welcome the opportunity to "re-litigate" the 2004 tax vote.

Deeds's aides, meanwhile, are pulling together instances -- dozens, they say -- in which Deeds voted for tax cuts, as well as votes from McDonnell's legislative career in which he supported increases in taxes or fees. McDonnell twice voted against amendments to eliminate the state's sales tax on groceries in the late 1990s. In 1999, he voted for the underlying bill, which reduced taxes on food, as did Deeds.

"If Democrats want to cherry-pick and make an argument about Bob McDonnell raising taxes, we've got dozens of votes to do it," said Deeds's spokesman, Jared Leopold.

But the economic downturn and a yawning budget gap may provide new resonance for the tax issue this year, said George Mason University professor Mark J. Rozell.

"The state of the economy is so dramatically different than it was in the last election cycle four or eight years ago," he said. "There is a different dynamic out there today."

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