'Governor Tax': This is not your grandfather's Taft

National Review, March 10, 2003 by John J. Miller

When President Bush announced his latest tax-cut proposal on January 7, the Republican Governors Association issued a strong statement of support the very same day. Colorado governor Bill Owens, the RGA chairman, called Bush's initiative "a common-sense plan" and observed that "a dollar spent in the private sector does much more to spark economic growth than a dollar spent on government." John Rowland of Connecticut hailed the president's "aggressive approach that offers real and compassionate solutions." Mike Huckabee of Arkansas urged Congress to grant "quick approval." Jeb Bush of Florida, Bob Ehrlich of Maryland, John Hoeven of North Dakota, Mike Johanns of Nebraska, and Judy Martz of Montana also chimed in.

Strangely missing from this roster was Ohio's governor, Bob Taft. Because he is vice chairman of the RGA, his views often appear near the top of the group's press releases. The reason for his silence became apparent the next day, when Taft put out his own statement offering faint praise for the president's "bold effort." Taft added that he was "concerned that the proposal to eliminate federal taxes on stock dividends may have a potentially negative impact on Ohio's budget," and basically asked the state's congressional delegation to oppose it. Furthermore, noted Taft, "I regret more money was not proposed to help the states [that] have suffered punishing revenue losses." In other words, the governor doesn't care for a key part of the Bush tax-relief package and wishes Washington would spend more -- to bail out states that went on their own spending sprees during the 1990s.

The problem with Taft isn't his failure to stay on message with the White House (which doesn't always deserve the unqualified support of GOP governors). It's that he has compiled a mediocre record, and it keeps getting worse. Last September, Taft was one of only four chief executives to earn a grade of "F" from the Cato Institute in its fiscal-policy report card. "Bob Taft has been the highest-taxing governor in America recently," said the study. When I read that line to Taft on February 13, he paused for a moment, then said, sounding surprised: "That was before we proposed this budget." He was referring to his latest initiative, announced in January: the biggest tax increase in Ohio history, coming at a time when Republicans control every statewide office and hold supermajorities in both chambers of the legislature.

This is not your father's Bob Taft. That honor belongs to Sen. Robert A. Taft, who is actually the current governor's grandfather. He was the son of a president (William Howard Taft), a leading critic of the New Deal, and the first great political leader of postwar conservatism. When he ran for the GOP presidential nomination in 1952, the party's base rallied around him -- only to see Dwight Eisenhower prevail in a contest that disillusioned many on the right. "Taft's defeat planted the seeds for Barry Goldwater's nomination in 1964," says Lee Edwards, a historian of conservatism.

Despite the gold-plated name, Gov. Taft has met few of the expectations his grandfather's legacy may have set for him. When the 61-year-old Taft talks about the old senator, he is quick to point out the man wasn't entirely conservative: "He supported federal spending on education and housing, you know."

Spending is the problem that's gotten Ohio into its current fix: a $720 million gap this year, plus an estimated $4 billion hole over the next two years. In the 1990s, Ohio's budget more than doubled in size. Only six states increased spending at a greater clip than the Buckeye State -- and they at least experienced rapid population growth. Taft continued this spending binge into the new decade, and to keep pace with it he slapped $349 million in new taxes on businesses in 2001 (which was less than the $465 million he originally sought). Last year, he boosted business taxes by another $400 million and jacked up the cigarette tax by 31 cents per pack. All the while, state spending rose faster than the combined rate of inflation and population growth. Under Taft's current plan, it's supposed to rise 5 percent in 2004 and 4 percent in 2005. "We need new revenue, and we need it right away," said Taft on January 22, in a somber State of the State address.

The governor now calls for a "season of sacrifice," in which taxpayers are expected to surrender an extra $3 billion by 2005, mainly through a 5-cent sales tax broadened to include the service economy. There are also new levies on businesses, a 45-cent tax increase on each pack of cigarettes, a doubling of the alcohol tax, and a gas-tax hike of 6 cents per gallon. Taft proposes cutting a few taxes as well, and thereby insists on calling his plan a "reform" package. But he can't hide from the obvious fact that he wants Ohio's government to wring more money from its residents. "This is not what we wanted to do," he says when pressed on the subject.

Taft delivered something of an anti-tax message to voters last fall, as he ran for reelection. Everybody knew that budget problems loomed, and the governor refused to rule out tax increases as part of a solution. During the campaign, he said that "narrowly tailored revenue enhancements" might be necessary. But he also ridiculed his Democratic opponent as "Taxin' Tim Hagan" and left the distinct impression that new taxes would be an absolute last resort. "When people voted in November for this governor, they didn't think they would be voting for monumental tax increases," says Mike Gilb, a Republican state representative. Another lawmaker, Democratic representative Derrick Seaver, was thinking about switching parties prior to the budget mess. "That was before Bob Taft became a Democrat," he jokes now. "I'm sticking with my party." In the meantime, Governor Taft has earned himself a new nickname: Governor Tax.