Monday, February 3, 2003

Taft plan resembles defeated opponent's

By Debra Jasper
Columbus Enquirer Bureau

COLUMBUS - Just three months ago, Gov. Bob Taft's campaign mailed a flier to senior citizens in Ohio blasting Tim Hagan for his plan to cut Medicaid and warning, "Seniors Can't Trust Tim Hagan to Protect Them."

Taft's spokesman at the time said that if Hagan won election, "Seniors should be scared."

Gov. Taft
If you have a comment on Gov. Bob Taft's plan to raise taxes, you can reach him at:
Constituent phone line: 614-644-4357
By letter:
Gov. Bob Taft
77 South High St.
30th Floor
Riffe Center
Columbus, OH 43215
Taft also trashed Hagan, his Democratic opponent in the governor's race, for raising taxes when he was a Cuyahoga County commissioner. Taft's campaign website portrayed Hagan as a cartoon character known as "Taxin' Tim," a guy who liked to raise taxes and gamble his money away at the racetrack.

What a difference three months makes.

Taft, a second-term governor who before the election wouldn't even utter the "tax" word, is now pushing for more than $3 billion in tax increases - by far the most in Ohio history.

He's calling for new taxes on everything from cigarettes, alcohol and tattoos to new cars, manicures and movie-going. He wants to slash Medicaid, the health care plan for the poor and elderly, by more than $1 billion. And he is threatening to cut funding for education if he doesn't get his way.

Taft's proposal is to be introduced today. It will need approval from the House and Senate to become law. The next two-year budget begins July 1 and ends June 30, 2005.

"He's taxing everything that moves," Hagan said last week. "He's finally admitting what he wouldn't admit during the campaign, that the state is in a serious financial crisis."

Hagan, along with political experts and others, says the governor's decision to downplay Ohio's fiscal crisis throughout last year's campaign season makes it tougher for him to sell his massive tax-hike plan now.

"He ran for office as a candidate who said we didn't have any problems, the budget's fine, thank you, and now we have this huge deficit," said Scott Pullins, chairman of the Ohio Taxpayer's Association. "I don't want to go as far as to say he was dishonest, but he certainly wasn't forthcoming."

Robert Adams, associate professor of political science at Wright State University, agrees.

"Taft set himself up politically and deserves some pain for what he did," Adams said. "He didn't campaign in a way that set the table for what he had to have known was coming."

Throughout the fall, Taft repeatedly emphasized that the state budget was balanced, which was technically correct, Adams said. "But we could all see the storm clouds gathering."

The governor last week defended his pre-election silence on Ohio's dire fiscal state. He pointed out that he did tell voters that "some narrow revenue enhancements" might be needed if the economy didn't improve.

"During the campaign I spoke about the fact we would have a very tight budget," Taft said.

Taft's spokesman, Orest Holubec, said the state budget was balanced through October and then tax receipts started to fall short. The governor, he said, "was working with the numbers he had at the time."

When asked if the governor believes $3 billion in increased taxes are "narrow revenue enhancements," Holubec replied, "The governor thinks this is a responsible package."

While the governor acknowledges the state is in crisis now, he spent much of this fall lashing out at Hagan for hammering repeatedly on the state's financial troubles.

"You're down on Ohio," the governor told Hagan during one October debate. "You're motto seems to be, `say something bad.' "

After that debate, Taft said, "I don't know what (Hagan) reads. I don't know where he gets a $4 billion deficit."

Taft now says the Ohio Legislature must go along with his tax proposals or the state will be $720 million in debt before the end of the year and face higher deficits in the next biennium budget. He won't reveal the size of those deficits until today - but some estimates show it could be as high as $4 billion.

Jerry Austin, who ran the Hagan campaign, said the most recent budget figures show what political insiders in Ohio already knew: Ohio is a financial mess.

"We weren't taken seriously but we were right," Austin said. "And now (Taft) is borrowing a lot of things right out of Hagan's playbook."

To be sure, many of Taft's ideas for balancing the budget were heard during the campaign - but not from the governor's camp.

In October, Hagan released a budget-balancing plan that called for: reforming Ohio's tax code to make sure all companies pay their fair share; broadening taxes on all corporations but lowering overall rates; and cracking down on companies who try to avoid paying taxes by putting their money in out-of-state accounts.

In the past two weeks, the governor said the state must: reform Ohio's tax code to make it more fair: broaden the corporate franchise tax but lower overall rates; and crack down on companies that try to avoid taxes by using out-of-state accounts.

During the campaign, Hagan promised to cut spending on Medicaid by $450 million. Page 14 of the Hagan plan said: "In the early 1990s, former Gov. George Voinovich referred to Medicaid as the `Pac Man of the Ohio Budget.' The days of Medicaid devouring the state budget have returned."

If the state doesn't rein in Medicaid spending, Hagan warned, it won't have the resources or flexibility to deal with any other part of the state budget.

Taft echoed those sentiments in his State of the State speech on Jan. 22.

"Gov. Voinovich once said Medicaid was the `Pac Man' of the state budget, devouring everything in sight," Taft said.

If the state doesn't rein in Medicaid spending, Taft warned, it won't have the resources or flexibility to deal with any other part of the state budget.

To fix the problem, Taft called for cutting Medicaid spending by $1.1 billion and also called for more tax hikes than Hagan had proposed.

"I'm not surprised," Hagan said. "He didn't tell the public how deep-seated the problems were, but we all knew it was bad."

There is one big move suggested by Hagan for balancing the budget that Taft has ignored. Hagan pushed to expand gambling in Ohio, saying allowing video lottery terminals at racetracks would raise $500 million a year for the ailing budget.

Taft slammed the plan before the election, and he still opposes it. But some Republicans side with Hagan on that issue and it is likely to be heavily debated as legislators decide whether to expand gambling to offset some of Taft's proposed tax hikes.

As the debate over how to balance the budget continues, Taft readily acknowledges these days that he finds himself in a bleak political situation.

During a recent news conference to announce his plan to cut medical benefits for 30,000 low-income parents and to cut dental, vision and other medical care to 800,000 Ohioans who are poor, disabled and elderly, Taft offered a half-hearted joke.

"The good news is I won the election," the governor said grimly. "The bad news is, I won the election."

Shelly Davis contributed to this story. E-mail

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