Governor Glenn Youngkin can take satisfaction from passage of the long-delayed Virginia budget.
As my colleague, Steve Haner points out, during his term of office Youngkin’s fight to increase the standard deduction will save the average Virginia couple up to $1,265 over three years, provide $900 in tax rebates, and eliminate the state share of the grocery tax (another $115 million in savings last year).
These results reduce taxes for nearly all Virginians from Dollar One.
But there must be some measure of regret at being unable to push through a more robust tax reform of the kind that made North Carolina the number one state for business, a state where the top corporate tax rate is 58 percent lower than Virginia and the top personal tax rate is nearly 20 percent lower.
In the competition for economic growth, lower taxes attract more businesses, more jobs, and more taxpayers to work at those jobs. It is at least one reason North Carolina had a net in-migration of nearly 100,000 out-of-state residents. Virginia? Nearly 24,000 more left the Commonwealth for other states than arrived here.
While it would be mind-boggling if the GOP failed to run on cutting taxes, campaign ads are partisan – reminding voters already supporting tax cuts to vote for tax-cutters, and ignoring any explanation of why lower taxes are important. Missing from this debate is a narrative that builds a coalition by explaining the value to individual Virginians of eliminating government-imposed burdens, freeing entrepreneurial activity, guaranteeing quality educational opportunity, and lowering the cost of goods and services through affordable and reliable energy.
Explaining these relationships isn’t easy. While throw-away lines in speeches receive a day of news stories, hammering the message home is a year-round job. No one did it better than Ronald Reagan, and he followed it up with campaign ads over and over and over again. His words are still used today in contemporary issue campaigns.
Whether Virginia stays on the course towards steady tax reduction, accelerates, or lurches back onto the road to higher taxes depends on the outcome of November’s elections. And while we’d dearly love to see more Democrats like centrist Chap Petersen in the General Assembly, the ideological cleaving of political parties makes it clear that the tax and economic outcome will mirror the partisan election results.
Left and Right have responded to this reality differently. Conservatives continue to invest heavily in political parties and individual candidates, hoping for “wave elections” or candidates with unique skills and attractiveness pulling others across the finish line.
That certainly worked for the GOP in 2021. But they will not always have a candidate willing to spend $20 million of his own money. Or an opponent who makes the closing argument for them.
Progressives, meanwhile, have been building cultural and political infrastructures to survive any given election setback. Instead of focusing exclusively on the next election or the next legislative session, they’ve looked over the horizon.
In The Blueprint: How Democrats Won Colorado (and Why Republicans Everywhere Should Care) journalist Adam Shrager and former legislator Rob Witwer describe how The Centennial State turned from red to blue. As two Weekly Standard writers noted: “It’s about infrastructure….with backing from a handful of large donors, (Colorado progressives) built a network of specialized, coordinated nonprofits to fill the void. The results were stunning.”
Jon Caldara, president of The Independence Institute, observed that “They (Democrats) invested more money, but they invested it much more wisely. Instead of just chasing candidates, they built infrastructure.”
The result was year-round issue policy education and issue mobilization that made a difference and did not rely exclusively on the politics of personality. It also laid the groundwork for future elections, crafting the environment within which political decisions are made at the voting booth and on the legislative floor.
We see this strategy deployed in Virginia today.
Democrats and their allies of the Left are investing in Virginia through non-profits and messaging operations, starting with Michael Bills’ and Sonja Smith’s investment of more than $30 million in infrastructure promoting the Green Agenda – nearly $14 million in the ’22-’23 cycle alone.
In policy, more than $10 million from a handful of foundations and labor unions has poured into the Commonwealth Institute for Fiscal Analysis in just four years. Much of that comes from funders affiliated with Arabella Advisors, described by The Atlantic magazine (hardly a right wing organ) as “the massive progressive dark money group you’ve never heard of.”
In 2020 alone, Arabella Advisors directed more than $2.2 million to non-profits supporting progressive efforts to build infrastructure and policy environment.
To be clear: This is all legal. It’s just a matter of where you get the biggest long-term bang for the buck.
Colorado’s Caldara pinpointed the difference: “Republicans in Colorado continued to put their money on racehorses, while the left just bought the racetrack.”
And for now, Republicans in Virginia are doing the same thing: putting their money on racehorses each year … hoping for the right combination of track conditions, a good jockey and superb form.”
Whether that strategy will have long-term success in the Commonwealth may well be decided this year, but perhaps it is time for conservatives to begin focusing on infrastructure rather than individuals; policies rather than personalities.
- Bait and Switch: Reform Reverts to Mo’ Money - March 2, 2024
- Virginia’s Tax Code: An Analog System in a Digital World - February 12, 2024
- Don’t Let Partisanship Stop Serious Tax Reform - January 22, 2024