When it comes to taxes, Virginia lives in a perpetual state of red alert: Merely mentioning possibly higher taxes has state leaders cowering under cover.
Or they take to the ramparts, which is what some leading Republicans are doing following Democratic Gov. Mark R. Warner's not-so-bold assertion that the state can't put off tax reform any longer. Warner suggested that rewriting the state tax code should necessarily entail increasing some historically low tax rates, and that sent several prominent Republicans into a major election-year swivet.
How could Warner say such a thing after promising as a candidate in 2001 that he would never raise taxes?
Easy. Warner was expressing a consensus view -- a pragmatic bipartisan view -- on the very old subject of tax restructuring, albeit in a new and more forceful way.
Last week, with the General Assembly safely out of Richmond, Warner used a Washington Post interview to sketch out his case for updating what nearly all agree is an outmoded tax code, saying a new tax system should be crafted to boost long-term revenue for Virginia's chronically under-funded public schools.
Warner made his pitch less than 48 hours after the assembly's Feb. 22 adjournment, and, without delving into the nuts and bolts of what tax "reform" might look like, framed it as part of his "advocacy of education in the broadest stroke . . . from preschool to grad school."
Warner said that tax reform should not be revenue-neutral, meaning that certain taxes would have to go up. For the record, the governor pointedly refused to speculate about which ones might.
Given the current level of anti-tax anxiety in Virginia, Warner's generalities on tax reform were a political time bomb; his more specific view that reform should increase some taxes was even more explosive.
The overheated Republicans who immediately denounced Warner's statements were not the experienced and more moderate-leaning leaders who actually want to improve things in Virginia and take the long view about addressing state needs. For instance, the two leaders of the state Senate and House of Delegates, both Republicans, have already embraced tax restructuring as an item on their must do list, not as some campaign issue that will enable them to score election-year points.
They know all too well that Warner did not pull tax reform from thin air. Tax restructuring was a major promise of his 2001 campaign -- a pledge that Warner quickly abandoned because of the state's political and budgetary climate. But even before that, the concept had been studied for years by Democrats and Republicans alike.
The system is riddled with inequities between, for instance, the state and local governments, and with loopholes, including many for wealthy corporations and "nonprofits" that tucked special exemptions into the Virginia code. In the political pursuit of low taxes, state leaders have left largely intact a tax system dating back to the 1920s, creating a revenue stream that is doomed to stagnate pretty much forever.
So it wasn't Warner the wild-eyed liberal who was talking taxes. In fact, the Democrat couched his tax talk in terms of his year-long, bipartisan effort to get control of the state budget -- closing a $6 billion shortfall and getting bureaucracy streamlining bills through the Republican-controlled assembly.
But true tax restructuring will never happen -- because no one really wants it to.
Warner certainly does not. However passionately he decried the sorry state of Virginia schools, Warner has no real stomach for what would arguably be the toughest fight of his political career.
That's what a top-to-bottom tax rewrite would be, harder than running a Democratic campaign in a mostly Republican state. The task of balancing all the competing interests -- the political partisans, corporate lobbyists, agribusinesses, charities and dozens of clamoring interest groups -- would be more than monumental. It would win Warner no friends and surely make him many enemies.
Besides, Warner believes that his plate is already brimming with things demanding his attention: Virginia's persistent deficit, dealing with a stubborn legislature and getting fellow Democrats ready for the Nov. 4 legislative elections.
He just hired Democratic Party stalwart Mame Reiley of Alexandria to be his political director. Reiley said she will not be on the state payroll (Warner's PAC will pay), and although she won't operate from the governor's office, she'll be spending much time in Richmond.
Tellingly, tax reform won't rank high on Reiley's priority list -- or Warner's. Within days of The Post interview, senior Warner aides were backing away from his tax talk as fast as they could. Meanwhile Warner showed no sense of urgency; he was scheduled to leave for Colorado this week on a nine-day ski vacation.
Democratic candidates don't want to be running for General Assembly seats with their governor's tax talk hovering over their campaigns, and rank-and-file Republicans will see to it that their leaders don't drag them down the tax reform road (unless it includes significant tax cuts).
So another year may go by with no action on this pressing but not particularly sexy issue. In the meantime, Virginia will remain on high alert about new taxes, guarding against the slightest gubernatorial chatter about finding new money for schools.