Return to Virginia Business - January 2002

What a fine mess we're in
All is topsy-turvy as new power spheres shape up amidst a budget disaster.

by Page Boinest Melton

That giant cracking sound you hear are the tectonic plates shifting under the Old Dominion - political realignments of seismic proportions. Republicans are talking tax increases. Democrats are an endangered species. A venture capital king - a Democrat from Northern Virginia, no less - is headed to the Governor's Mansion. Virginia's buttoned-down business community, long a stalwart of the status quo, is emerging as a progressive force. Lobbyists are left to look and leap, choosing which side to join among the new divide.

New players are talking up bipartisan cooperation while old hands - having heard that clarion call many times before - retain a sense of perspective. Thank goodness for the new State Capitol metal detectors - hardcore partisans will have to check their long knives at the door.

Here's a look at how the new centers of power and pressure points are forming in Virginia's new political geology:

The Governor: Amidst all the turmoil, the most important event of all is unfolding. Gov.-elect Mark Warner has spent a lot of his transition time trying to put together his team that will guide the commonwealth for the next four years. Faced with a $1.3 billion shortfall in the state's budget this year - the unfortunate legacy of Gov. Jim Gilmore's stubbornness - a recession and the Sept. 11 terrorist attacks, governing just doesn't look like much fun. Finding the right combination of talent to govern has been a considerable challenge for the tall entrepreneur, who ran one of the smartest gubernatorial campaigns in recent Virginia history.

Warner's big problem? The budget, no question. His straight line to a business group about how he was spending his time post-election tells it all: "I'm trying to get my arms around the budget." The crowd laughed at the unintended joke, not in appreciation of Warner's humor, but of the understatement. Virginia's budget deficit is serious stuff: a billion here, a billion there - we're talking real money. Compound the shortfall with emboldened constituencies who want more money for roads and schools and mix in a Republican majority legislature that may or may not want Democrat Warner to wind up the hero. Even with those odds, the early money is on Warner, that as the first businessman-governor in 44 years he has the know-how to juggle it all.

For his part, Warner is pushing a bipartisan line, saying the fiscal worries "are not a Democratic problem or a Republican problem, but a Virginia problem." Alexandria Delegate Brian Moran, the new House Democratic caucus chair, notes that Warner's appeals to Republicans are reflective of his campaign - he needed Republican voters to win - "and the political reality of the cards we're dealt." Warner got budget talks off on the right foot by tapping John Bennett, the well-regarded Senate Finance Committee's staff director, as his Secretary of Finance. Legislators will feel they are getting the straight skinny from a former staffer - important, because every little bit may help the new administration.

The House of Delegates: Once Warner has his whole team in place, he faces even bigger obstacles. Call them fear, loathing and House Republicans. Just over four years ago, for example, Amherst Delegate Vance Wilkins was considered a dogged, conservative leader of his minority Republican Party. He was solid for a pro-gun vote, sure to support the pro-life position. Yet during this session Wilkins is The Man. He will gavel a solidly Republican House into order: 64 Republicans, plus two Independents expected to caucus with GOP members. Money, and who controls it, will be key, flavored by Wilkins' conservative perspective. Legislators in both parties are watching Wilkins to gauge the fate of this session's marquee funding issues: tax increases some want for transportation and education. Typically, Wilkins views the pressure for new roads in Northern Virginia with some detachment, wryly saying he just schedules his Washington-area business after 10 a.m. to avoid the traffic.

With the majority in the House, Republicans can scrap their power-sharing deal with Democrats, handing outright chairmanships to veteran hands like Fairfax Delegate Vince Callahan, head of the powerful Appropriations Committee. It also gives the speaker an almost veto-proof majority - a big stick in negotiations with the new governor and with the more moderately inclined Senate. "The speaker is arguably the most powerful man in the commonwealth of Virginia," says Virginia Beach Delegate Leo Wardrup, a loyal Wilkins lieutenant and chair of the House GOP caucus. "He's in charge and he has the majority." Adding to his staying power: while Virginia governors serve just four years at a time, chances are Wilkins will be around to greet Virginia's next chief executive.

The State Senate: As Vance Wilkins' slow steady climb to near-royal status proves, the race is not always to the swift. So learned the cautious senators in both parties - and even business leaders - who predicted car tax mayhem. Stafford Sen. John Chichester, chairman of the Senate Finance Committee, took considerable heat from some in his own party last year - including Gilmore - for sticking to traditional GOP virtues such as fiscal responsibility. But not all were unhappy with Chichester's deliberate hand: Republican firebrand Tommy Norment, the state senator from James City County, suggested Gilmore was so out of touch he was snacking on "hallucinogenic mushrooms." A good line, perhaps, but one that didn't win him any friends in the "just say no to car taxes" crowd. Today Chichester and colleagues look like geniuses for the go-slow approach, but then this year the message is even harder to swallow. Chichester suggests taking an ax to the budget to balance it right away, slap on a tourniquet and then look ahead to the longer-term spending demands.

The Business Community: Not always can business play kingmaker, but business leaders are feeling pretty good about the elections. With the Northern Virginia cluster leading the pack, key business figures from across the state put their bucks with politicians who supported transportation funding and better fiscal management. An uncanny number shifted from traditional support of GOP candidates to Mark Warner, who seemed, well, sort of like a GOPer himself. Warner raised the issue of a transportation referendum in the governor's race - never mind that he tried to spin his way out of it when Republicans tagged it a tax increase. He still got credit for being responsive.
Statewide, business execs contributed to Warner in droves, abandoning Republican candidate Mark Earley. This session, business groups are emboldened to speak in a collective voice. They're banding together in a 16-group coalition to impose some business sense on Virginia's finances. "The movement toward a car tax cut overall has convinced a lot of people in Northern Virginia - including major donors in the Republican party - that this (Republican) party has lost all sense of perspective," says Mary Washington College political scientist Stephen Farnsworth. "Had you told me a few years ago that the Republican Party would have trouble nailing down money from the business community, I would have said you were ridiculous."

The Democrats: Check the milk cartons. Where are you guys? They've got the state's top two jobs, but otherwise these are grim days for the once-powerful Democratic Party. Republicans started the long march to dominance and Democratic decimation when they knocked off veteran Newport News Sen. Hunter Andrews in 1995. They capped it with last year's redistricting that forced the retirement of such long timers as House Minority Leader Dick Cranwell of Vinton. Rural Democratic seats were altered to favor Republicans, adding a greater GOP flavor to the rural caucus.
House Democrats are looking for a voice to stay relevant in the rough-and-tumble discussions ahead. "We can count," says House Minority Leader Frank Hall of Richmond. Look for Hall and his band of brothers and sisters to stick close to Warner and fully test the, uh, opportunities of being in the minority. Hall says despite the loss of some veterans, "We have some seasoned senior members who have a solid working knowledge of the budget process, and we've also got some very talented young members who are going to have their chance to shine." In the Senate, partisan lines are a lot more blurred. Minority Leader Dick Saslaw forged working relationships last year with some of the GOP's most influential senators. With the slam-dunk margin for Republicans in the House, Warner will feel more at home in the Senate with what Saslaw calls his "ideological majority."

The 2005 Contenders: As always, the campaign signs haven't even come down and there's talk of who will run for governor in the next election. Two likely contenders: former Richmond Mayor Tim Kaine, the Democratic son-in-law of former Gov. Linwood Holton just elected lieutenant governor, and Attorney General-elect Jerry Kilgore, a former legislator and public safety secretary who's the only Republican to hold one of the three statewide positions.

Kaine is quitting his law practice to work full-time at what officially is a part-time job. He plans to use his perch to work closely with local governments and tackle K-12 education funding; he can probably count on airtime because of his alliance with Warner. Most importantly, he says, "My job will be to preside over the Senate in a way that will try to work with colleagues to lead us to common ground." He makes no apologies for thinking about higher office, saying it's only natural. "I think Virginians should want as attorney general and lieutenant governor people who want to run for governor. It's good to have a couple of other positions where people can be in the firing line and voters can see what they're made of."

Kilgore, with no formal budget role and a friendly GOP majority in his hip pocket, could have more fun than anyone this session. If he sticks to his agenda and highlights his terrorism issues, he may be able to dodge the flak from the budget fallout. He plans a hard-charging legislative presence to build his record, beefing up the attorney general's lobbying cadre at the Capitol to promote his issues, which include ethics reform and domestic violence. "We're going to have an aggressive attorney general's office," he vows. "I didn't run for the job just to file the briefs on time."

While Kilgore and Kaine make no secret of their interest in the Governor's Mansion, both may find the next step a doozie. Neither former Attorney General Mark Earley nor outgoing Lt. Gov. John Hager could translate their respective four years into winning gubernatorial campaigns. In fact, the lieutenant governor's job hasn't produced a governor since L. Douglas Wilder in 1989. Kaine won the recent election with a little help from his friend Mark Warner, a squeaker over a lesser-known House member whose hard-core conservatism was pretty far out for even Virginia. Fellow Democrats suggest Kaine take the next year or two to look at the tapes and figure out his vulnerabilities.

As for Kilgore, he's keeping an eye on Gilmore, whose national political influence dims when he steps down this month as Republican National Committee chairman. Some Gilmore loyalists have been making noises that he will run for governor again in four years, which could create a bottleneck for Kilgore. It's unclear how Gilmore's final year in office - the combative clashes with legislators over budgeting and his jettisoned car tax cut - would affect another statewide run. But maybe, after shifting political plates settle into place, four years is just enough time to forget.