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Capitol Perspectives: Echoes of a Past Budget Crisis

Phill Brooks
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The dome shines brightly on the Missouri State Capitol as the sun begins to set in Jefferson City, Missouri. Photo: UPI/Bill Greenblatt

The dome shines brightly on the Missouri State Capitol as the sun begins to set in Jefferson City, Missouri. Photo: UPI/Bill Greenblatt

Election Returns

An Albany reader of my earlier column about relations between the governor and legislature suggested that Gov. Jay Nixon’s reluctance to work with lawmakers might reflect a lesson from former Gov. Bob Holden’s experience.

Interesting point because there are some very close parallels in the challenges the two administrations encountered.

Democrat Bob Holden served as governor from 2001 to 2005. By the end of his administration, his relations with the legislature had become horrid.

Holden came to office as Republicans were gaining control of the legislature. Just weeks after he was sworn into office, a special election gave Republicans control of the Senate for the first time in 52 years. The House fell to Republicans less than two years later with the 2002 elections.

Holden did not help himself in how he responded to the Republican tide.

Rather than moderating his liberal philosophy, Holden seemed to go out of his way to pick a fight with the legislature.

When revenue collections began falling short, he proposed a tax increase package that would have been one of the largest in state history. It was an obvious nonstarter for a Republican legislature with members who had campaigned on holding down state spending.

Beyond proposing a tax increase, Holden refused to give lawmakers a budget that was balanced on existing revenues. Instead, his budget was based on the legislature passing nearly $700 million in tax hikes.

On top of that, some of his leading administration and budget officials flatly refused to assist legislators in crafting a balanced budget. When the legislature passed a budget based on existing revenues, Holden simply vetoed major parts of the budget, which forced the legislature into an early-summer special session.

Holden again called for higher taxes. The legislature again refused and passed a budget based on existing revenue. And, again, Holden vetoed the budget bills. Only after the legislature refused to budge and passed its original bills with almost no debate did Holden give in and sign the bills.

The next year, 2004, started on the same path, with the governor again calling for massive tax increases.

Holden’s State of the State address to the legislature was described in at least one news report as having “scolded” the legislature for its refusal to raise funds. As I remember that speech and its tone, calling it a scolding was putting it mildly.

It was so confrontational that it provoked an outburst of heckling by House Speaker Pro Tem Rod Jetton, who was applauded by his GOP colleagues for interrupting the governor’s speech.

It was the first and only time in my career I’d seen that kind of behavior during a governor’s address to a joint session of the legislature.

Holden never seemed to recover his political balance in that final year of his administration. In August, he was defeated decisively by Claire McCaskill in the Democratic primary for governor. Republican Matt Blunt won the general election.

There are some clear similarities between the Holden era and the situation Nixon now faces.

Like Holden, Nixon must deal with a Republican-controlled legislature. And Nixon is grappling with problems similar to those Holden encountered with education funding because of the slow growth of state revenues.

Also like Holden, Nixon is facing harsh legislative criticism for withholding education appropriations to balance the budget.

There are, however, some significant differences.

Although Republicans still control the legislature, in even greater strength than Holden faced, there is a less partisan tone. The Republican speaker named three Democrats to chair House committees, one of which is a powerful appropriations committee.

In the Senate, relations between the two parties are so cordial that the Republican leaders invited Democratic Floor Leader Victor Callahan to join them for the leadership news conference on the opening day of this year’s legislative session.

A while back, a former legislator told me that he thought Republicans had learned how to be a majority party while Democrats have learned how to be in the minority.

Another difference lies in ideology. Holden was a consistent, unapologetic liberal going back to his first years as a young state House member.

Nixon is significantly more moderate. Facing a budget crisis similar to that of Holden’s era, Nixon flatly has ruled out tax increases. Instead, he champions an idea supported by many Republicans: business tax breaks for economic development.

Although the financial crises the two men faced are similar, their approaches are substantially different.

As always, let me know (at column@mdn.org) if you have any comments. If you would like your comments, or a portion of them, included in a future column, let me know and be sure to include your full name in your email. Past columns are available at www.mdn.org/mpacol or here.

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