Virginia Lawmakers Reject Stimulus

Days after Virginia legislators voted to reject parts of the federal stimulus money that the Old Dominion was to receive, pundits and politicians are taking time this Easter weekend to gauge just what the political fallout will be.

Last week, lawmakers in Richmond voted to decline $125 million of the $4 billion in federal stimulus money that Virginia is getting.  The purpose of the $125 million was increased unemployment compensation for the jobless and those who are retraining after losing their jobs.  (The senate, which is controlled by Democrats, voted along straight party lines 21-to-19 to accept the two amendments containing the $125 million; the Republican-run House of Delegates, however, voted 53-to-46 to decline the money and, since acceptance requires approval of both legislative chambers, the $125 million was turned down; all but two Republican House Members voted “no”).

Although Republican governors in at five states so far have called for rejection of parts of the stimulus package, this is the first time that a state legislature has defied a Democratic governor and said “no” to the federal largess.  

The unique nature of Virginia’s “no” notwithstanding, the action is rapidly drawing national attention because it is happening in one of two states that will elect a governor this year.  Already, speculation is mounting whether it will help or hurt certain GOP nominee Bob McDonnell’s chances of becoming the first Republican governor of Virginia in eight years, or whether it will give fresh “class warfare” ammunition to the three Democrats vying to succeed lame duck Gov. Tim Kaine (who is the only governor in the nation barred from a second consecutive term).

Political scientist Merle Black, one of the nation’s most quoted authorities on political trends in the South, thinks the latter.   As Black told the Washington Times, “This will be an issue the Democrats will use to try to define the Republicans.”

The national impact of the Virginia lawmaker’s’ stimulus turndown is further underscored by Kaine himself, who doubles as Democratic National Chairman.  Having called for acceptance of the package and met rejection, an angry Kaine told the Chamber of Commerce in Martinsville, Virginia: “Of the $4 billion in federal stimulus money Virginia is getting, the legislature chose to reject only $125 million and that was money hit hardest by the recession we’re in.”  (Martinsville has the highest unemployment in the state, 20.2%).  

But, much like the near-unanimous Republican votes against the stimulus package in Congress, the “no” vote in Richmond last week could rally state GOP activists behind their ticket that is competing for the three statewide offices this fall.  Every Republican senator and all but two Republican House Members opposed the $125 million and one lawmaker who is seeking statewide office himself has embraced it with vigor.  

“We are being used," Sen. Ken Cuccinelli II (R-Fairfax), the leading GOP candidate for attorney general, told the Washington Post.  "Actually our constituents . . . who are now unemployed are being used by this administration to hold a gun to the head of this general Assembly with the assistance of the governor to force through a bad bill."

Republican gubernatorial hopeful Bob McDonnell told me, “To receive this additional short term funding from the federal government, we would have to permanently change state benefit law and saddle businesses and taxpayers with a significant unfunded federal mandate that will hurt our long term ability to create the new jobs we need. For that reason I don’t  believe it is in the long term best interests of the Commonwealth’s citizens to accept this specific short term funding by permanently changing our benefit laws.”

He added, “The federal government should reconsider the draconian requirement that this short term funding be predicated on a permanent change in state law, and focus on providing the needed short term relief for displaced workers and their families. I am looking for ways to bring people together to get the funding we need in the short term without hurting our ability to grow the economy in the long term."

Will other states follow Virginia’s example?