Republicans Must Find a New Way Forward

Virginia is a blue state now. Not only do Democrats occupy all statewide elected positions — two U.S. senators, governor, lieutenant governor, and attorney general — with yesterday’s election, they control both houses of the General Assembly.

Republicans got their booties kicked. And the butt-stomping is not likely to subside. The Dems will control the next redistricting, which will cement their dominance of the legislature. Auguring well for the blue team in the future, the fastest-growing region of the state, Northern Virginia, now is pure blue with bits of purple on the exurban fringe. By contrast, Republican strongholds in rural Virginia have shrinking or stagnant populations. Also favoring Democrats in the long run is the increasing percentage of racial/ethnic minorities in the state and the declining percentage of whites.

Republicans need to re-define who they are and what they stand for, or they will become a permanent minority. News reports say that dislike of Donald Trump drove Democratic voter turnout, but the Blue Tide is much broader and deeper than voter animus of one man. Take Trump out of the equation after the 2020 election, and Virginia Republicans still have a huge problem.

Can the Republicans re-calibrate? I certainly hope so, because I’m terrified of the Democratic Party agenda of $15 minimum wage, spiking the right-to-work law, a damn-the-torpedoes-full-speed-ahead rush to a 100% renewable electric grid, spending and taxing, taxing and spending, and injecting its grievance-and-victimhood agenda into the consideration of every issue. But Republican priorities on culture war issues — guns, abortion, transgenders — are not winning issues statewide. As long as Republicans remain captive to its rural/small-town base, I don’t see how it can reinvent itself.

What does a rejuvenated Republican Party look like? (Or, if the GOP is incapable of reinventing itself, what does a successor party look like?)

First, it would take the culture-war issues off the table. Recognizing that reality is complex and messy and that sound-bite solutions usually have unintended consequences, it would stake out the middle ground against the extremists of both sides. No more trans-vaginal ultrasounds. But no aborting babies who have reached the birth canal. No right to carry semi-automatic weapons in public restaurants. But no free sex-change surgery for seven-year-olds confused about their gender identity. In other words, don’t do crazy.

Then the rejuvenated GOP (or its successor) should position itself as the Opportunity Party, creating economic opportunity for all Virginians of whatever racial, ethnic, or socioeconomic stripe.

In the economic sphere, that means identifying with and promoting job creation, entrepreneurship and small business. It means fighting the credentialism in which an increasing share of all jobs require a four-year college degree. It means improving the effectiveness of our public schools where we can, and creating alternatives (charter schools, vouchers, home schooling) where we can’t. It means shaking up the ossified structure of public colleges and universities to make them more affordable and accessible.

A rejuvenated GOP would articulate win-win approaches to health care, housing, transportation, and the environment.

Health care — Instead of expanding tax-and-spend entitlements, focus on boosting the productivity and quality of Virginia’s health care system. A more productive and efficient system brings down costs for everyone. Better medical outcomes benefits everyone.

Housing — The root cause of the affordability crisis and the eviction crisis is the failure of the home building sector to increase the supply of housing to meet rising demand. Bring supply and demand back into balance by reforming local zoning codes and comprehensive plans.

Transportation — Scrap the idea of free, convenient transportation as an entitlement. Restructure the transportation system along user-pays principles. Acknowledge the intimate link between transportation and land use. And figure out how to take advantage of the Mobility-as-a-Service revolution.

Environment — Move toward a 100% renewable electric grid as expeditiously as possible while balancing the goals of sustainability, cost, and reliability. The globe won’t heat up any faster if, by waiting for new technologies to emerge, we take five or ten years longer to reach our goal.

Size and scope of government — Contest the idea that government is the solution to every perceived societal ill. Embrace the idea that government should focus on a few core responsibilities and do them really well. Keep taxes low. Well, they’re not low — keep them moderate. Don’t become New Jersey. Celebrate new for-profit and non-profit business models for helping the poor.

Obviously, those are high-level themes. Republicans (or their successors) need to do the hard work of filling in the details. It won’t be easy. But do it they must, or Virginia will become New Jersey.

A version of this commentary originally appeared in the November 6 edition of the online Bacon’s Rebellion blog.

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Will California Dictate to Virginia Farmers?

Early last month the North American Meat Institute (NAMI) filed a complaint against the Attorney General of California and the Secretary of California’s Department of Agriculture to stop the state’s Proposition 12 law, which flies in the face of the federal Commerce Clause. Their move for a preliminary injunction to stop California’s effort to regulate how hogs and veal calf housing is to be regulated in 49 other states will be heard on November 18.

NAMI believes the law will “…transform the interstate and international market for pork and veal by banning the sale of wholesome meats imported from other States and countries unless farmers in those States and countries comply with burdensome animal-confinement (rules) that California voters adopted…”

Another titanic battle between agricultural interests and animal rights interests could be forthcoming.

In 2018 California voters passed Proposition 12, which forces California farmers to provide minimum standardized space for egg-laying hens, breeding pigs, and calves raised for veal. California businesses will be banned from selling eggs or uncooked pork or veal that came from animals housed in ways that did not meet these requirements; so, any non-California based farmer who wishes to sell same products to California consumers must adhere to these rules.

That sounds unconstitutional

But can one state get away with that?

The argument goes back to 1787 at the Constitutional Convention where the Commerce Clause in Article 1, Section 8 said Congress would hold the power to regulate commerce among the several states. The 10th Amendment of the Constitution adopted in 1791 declared that powers not delegated to the United States are basically reserved for the states. For almost 100 years the precedent was set by Gibbons v. Ogden in 1824, which said states had a right to regulate business under the 10th Amendment. In 1942, Wickard v. Filburn (Ohio wheat farmer case) held that virtually any effect on interstate commerce fell within the power of the federal government, and that included any federal regulation addressing cultivation of crops and the raising of livestock.

NAMI claims it represents the largest number of packers and processors of pork, veal and processed meats in the country.

One of the critical arguments NAMI makes reflects a common sense argument all in agriculture will recognize. “Proposition 12’s sales ban violates the Constitution’s Commerce Clause because it imposes substantial burdens on interstate commerce that clearly outweigh any valid state interest.”

NAMI’s Request for Preliminary Injunction states that Proposition 12 is clear. “The sales ban’s entire point is to affect interstate commerce.”

It is clear California’s Proposition 12 has a disproportionate burden on interstate commerce. The memorandum supporting the motion describes how the veal industry has recently spent over $150 million to build “tether-free” housing. Proposition 12 requires 43 square feet per calf. NAMI argues this is twice the square feet per calf that the European Union standards require.

NAMI argues that California’s Proposition 12 imposes interstate burdens that “…are direct, non-speculative, significant in magnitude, and will be felt inside and outside of California.” As a result, all (U.S. and foreign) pork and veal producers would be forced to change the inside of their buildings and how they produce hogs and veal. For example, California’s Proposition will require all out-of-state pork production facilities “…to eliminate breeding stalls and gestation crates immediately…”

NAMI believes and argues this requirement alone will make it “virtually impossible” and require a number-of other state producers to exit the California market.

The sales ban

Proposition 12 also includes a “sales ban” which said these requirements would apply to an out-of-state producer. This, of course, set off a dispute where many state Attorneys General filed suit in California several years ago — and lost.

Another two original actions were filed requesting the U.S. Supreme Court to review California’s Proposition 12 and its sales ban designed to extend California’s housing requirements onto out-of-state producers selling products in California; it also failed.

This will be the third attempt, starting with the U.S. District of Court in the Central District of California, to overturn California’s attempt to impose its will on animal agriculture in other states.

Proposition 12 requires the California Secretary of Agriculture to promulgate regulations implementing the proposition by September 1, 2019. The department failed to meet that deadline. NAMI was informed on September 23, 2019 that Proposition 12 regulations will be proposed by the end of 2019 and finalized a year later in 2020.

Is this discrimination?

NAMI claims its members are being discriminated against in violation of the U.S. Constitution’s Commerce Clause. It states that California’s Proposition 12 is to protect California producers “…from bearing costs not borne by out-of-state competitors.” Paragraph 49 of the complaint states the issue clearly and accurately by attacking Proposition 12 “…as an impermissible protectionist trade barrier, blocking the flow of goods in interstate commerce unless out-of-state producers comply with California’s regulations.”

Animal agriculture must and should support NAMI on this one. The complaint declares, “California has no legitimate local interest in how farm animals are housed in other states and countries.”

California has no authority to regulate the conditions under which farm animals are housed outside its borders.

And if California wins this case, it is easy to imagine the state’s population could decide to pass a proposition declaring that all corn, soybeans, and other GMO crops harm California citizen health (even without scientific evidence). California could set the standards for how farmers produce crops, as it now attempts to regulate how pork and veal are produced.

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Trump Fueled Already Fired Up Democratic Base

In the Virginia General Assembly elections held Tuesday, President Donald Trump fueled the Democratic takeover of both the House of Delegates and State Senate.

From our friends over at Wikipedia on the definition of fire:

“Fires start when a flammable or a combustible material, in combination with a sufficient quantity of an oxidizer such as oxygen gas or another oxygen-rich compound (though non-oxygen oxidizers exist), is exposed to a source of heat or ambient temperature above the flash point for the fuel/oxidizer mix, and is able to sustain a rate of rapid oxidation that produces a chain reaction. This is commonly called the fire tetrahedron.”

Basically, fire needs a flashpoint to start. Then the fire needs more fuel and oxygen to keep burning. But first, combustible material must be present.

From The Washington Post:

“But singling out Trump as the reason for Republican failures in 2019 “is too easy,” said Mark Rozell, a George Mason University professor of public policy. Rather, he said, Virginia’s GOP over the past decade has gravitated toward the right on social issues and alienated moderate voters.”

Rozell suggests that Virginia Republicans had piled up combustible fuel just waiting for a spark. That’s not an unfair observation. Was that enough to flip both chambers though?

Further analysis on this historic election will be done, but let’s not look past the “too easy” flashpoint of President Trump who routinely, almost daily, throws more fuel on a hot burning fire while at the same time fanning the Democratic flames.

Did the Virginia GOP make mistakes? Sure.

Name a governing majority that hasn’t.

But take nothing away from the Democrats in Virginia.

They are very, very good at what they do. Democrats took full advantage of the opportunity presented to them.

News outlets have put in their reporting that this is the first time since the early 90s that the Democrats will control the Executive Branch and the two legislative chambers.

Let’s go there.

In 1992, Bill Clinton was elected president with 43% of the vote nationally but won only 40% of the vote here in Virginia.

A year later, Democratic nominee for governor, Mary Sue Terry got slightly under 41% to Republican George Allen’s 58%.

Quick aside – Trump got 44.4% in 2016, while Ed Gillespie got 44.8% in 2017. Very similar to Clinton and Terry in that Gillespie and Terry both lost badly but improved by less than 1 point from previous year.

The GOP was fired up in 1993 like the Democrats were in 2017. Lots of issues were dry kindling, but Clinton overreach on healthcare (HillaryCare) lit the pile.

After the 1994 Republican takeover of Congress, President Clinton declared “the era of big government was over” in his 1996 State of the Union Address.

Clinton took away enough Republican fuel including signing a welfare reform bill and was re-elected that November.

During the Clinton and Governors Allen/Gilmore years of 1994-2000, the Democrats saw their House of Delegates majority go from 58 to a Republican takeover after the elections of 1999.

Redistricting boosted the GOP House advantage to 64 + 2 conservative Independents after the 2001 elections in which Democrats Mark Warner and Tim Kaine won Governor and Lt. Governor respectively. Jerry Kilgore became Attorney General as a Republican at the same time.

That election occurred less than two months after 9/11 and ushered in strong bipartisan sentiments from the electorate.

The presidency of George Bush and the Iraq War fueled a lot of Democratic fire during the governorships of Warner and Kaine. GOP membership in the House fell from a high of 66 to just 56 during the last cycle of President Bush.

Barack Obama’s historic election as president in 2008 refueled the Republicans back up to 61 seats in the House and Bob McDonnell’s landslide 58-41 win in 2009. Redistricting bumped those numbers up even higher to 68 as the Affordable Care Act added more fuel and oxygen to the GOP fire.

During the governorship of Democrat Terry McAuliffe (2014-2018), the Democrats only got to 34 seats in the Virginia House with Obama in the White House.

Throughout this post-Cold War time period, the State Senate went to a 20-20 tie with the 1995 elections and then effective Republican control in 1997 when Republican John Hager became Lieutenant Governor. In the last cycle of the Clinton Administration, the Democrats lost outright control of the Senate 19-21 in 1999.

The first State Senate election of the Bush presidency occurred in 2003 and after redistricting. This pushed the GOP advantage in the Senate to 23-17. However, the General Assembly elections in 2007, during the last cycle of President Bush, saw the Senate flip back to blue 22-18 as House Democrats also climbed seats to 44 seats up 10 from 2001.

The first State Senate election in Virginia under President Obama saw a 20-20 tie in 2011 and then outright control at 21-19 for the GOP in the last Obama cycle in 2015.

  1. Donald Trump. Enter stage right.

Dramatic upset. Flashpoint for Democrats. BOOM.

Then came the Virginia elections of 2017 for the three statewide offices and the House of Delegates.

Democrats swept the top three statewide offices and gained 15, and very nearly 16, seats in the House.

The 2019 elections Tuesday occurred in the second half of Trump’s first term and fueled the fire of Democrats leading to an additional 6 seat pick up in the House and a 2 seat pick up in the Senate for outright control of both chambers.

To Rozell’s point of Republican missteps along the way -Yes, there were mistakes.

There always are. And that is fuel.

The flashpoint which lit that fuel here in Virginia was the election of Donald Trump who brought a LOT of his own fuel. Trump continues to add more of it as well as oxygen to keep the fire burning very hot for Democrats. Very, very hot.

Reports are that the Democrats are trying to learn from these lessons of history by planning out how they can govern and get re-elected regardless of the party in the White House.

As a history major and former history teacher, I always applaud those who try to learn from the past.

The question for the new Virginia majority will be how do they keep both fuel and oxygen away from the Republicans’ pilot light and while keeping Democrats fired up if Trump loses to one of their own just 362 days from today.

That’s a hard balance for a party to game out with an economy historically overdue for a recession, a yield curve inverted since August, and a political base expecting results consistent with what is being sold by their national candidates.

In politics, fires are required for success. Fires are especially hard to control when you’re in control of neither the fuel nor the oxygen.

Just ask Virginia Republicans who are hoping that the suburban voters that continue to burn white hot against Trump and also not becoming permanently blue.

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Want to Help Workers Work? Keep Virginia’s Right To Work Law

Are a majority of Democratic candidates for the Virginia General Assembly “anti-worker?” Based on their response to a Virginia Chamber of Commerce survey, it would seem that way.

General Assembly candidates were surveyed on whether they would support Virginia’s Right To Work (RTW) laws. Republicans were unanimously supportive. Democrats were almost equally opposed to retaining the Commonwealth’s 72-year-old law, with only five responding they would keep it.

The “comments” section of the survey betrayed the ignorance of many candidates about the advantages of Right To Work, portraying the law as a Dickensian throwback pitting businesses against workers with some citing a questionable recent Oxfam survey (see accompanying column by Chris Saxman) ranking Virginia low on “best state for workers.”

The truth shows a very different picture. Study after study demonstrates that a state Right To Work law improves not only the opportunity for a worker to have a job, but also drives personal incomes higher.

These considerations are important. Republicans and Democrats alike have expressed concern about Virginia’s reliance on the federal government for jobs, whether directly or indirectly through federal contracting. Only by building and maintaining a robust manufacturing and high tech sector will Virginia retain, for example, CNBC’s ranking of Virginia as “Best State for Business.” In doing so, CNBC cited Right To Work laws as a factor.

The issue of a state’s labor laws is important to businesses of all stripes, and is among the reasons Amazon reversed its decision to build a second headquarters in New York City. Despite $ 3 billion in state subsidies, the tech giant walked when told by officials in the Big Apple that $150,000-a-year tech workers would have to join a union.

Simply put: Right To Work laws are attractive to employers. And without employers, there are no employees.

What does the evidence show? Do Right To Work laws help businesses or workers? The answer to both is “yes.”

In a May 2018 study, Dr. Jeffrey Eisenach, Managing Director at National Economic Research Associates and an adjunct professor at George Mason University examined data comparing economic outcomes in Right To Work states with non-Right To Work states, noting “the data is consistent with, and thus supportive of, the results of more than four decades of rigorous economic research.”

Whether private sector employment, the unemployment rate, manufacturing output or higher personal incomes businesses and workers in RTW states do better than those in non-RTW states. Between 2001 and 2016 …

  • Private sector employment in RTW states grew by 27 percent, compared with 15 percent in non-RTW states.
  • The annual unemployment rate in RTW states was, on average 0.4 percentage points lower than in non-RTW states. While four-tenths of one percent may not seem like much, if those non-RTW states had had the same unemployment rate as RTW states, there would have been 249,000 more Americans employed in 2017.
  • Real manufacturing output rose by more than 30 percent in RTW states compared with 21 percent in non-RTW states.

The reason all this is important? According to Eisenach’s study, higher growth rates translate into higher personal income, rising 39 percent in RTW states vs. 26 percent in non-RTW states.

This echoes a 2003 study conducted by Robert Reed for the Journal of Labor Research, finding wages 6.7 percent higher in RTW states than in non-RTW states.

Five states have passed Right To Work laws since 2012. Former union strongholds like Michigan, Indiana and Wisconsin have turned away from laws forcing workers into unions and those states have seen dramatic economic growth improving the condition of workers’ lives: In Indiana, factory payroll employment grew 9.4 percent; in Kentucky, $9.2 billion in new investments added 100,000 new jobs; in Michigan, the unemployment rate fell by 4.8 percent.

Virginia is in competition with each of those states for new business that will put more Virginia workers to work. Voters might well want to ask candidates favoring repeal of Right To Work why they want to put the Commonwealth at a competitive disadvantage … and in the process hurt the ability of workers to find a job and improve the lives of their families.

Chris Braunlich is President of the Thomas Jefferson Institute for Public Policy. 

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Is Questioning Obamacare Now A Third-Rail Issue in Virginia?

Three health insurance proposals which passed the Virginia General Assembly only to be vetoed are now front and center in the November election. What were they? Were they efforts to weaken and ultimately destroy the Affordable Care Act (Obamacare) or efforts to provide lower-cost choices for those unable to afford ACA policies?

At the end of the 2019 General Assembly, Governor Ralph Northam vetoed seven related bills, but they represented various versions of just three basic ideas for lower-cost insurance plans:

  • Allow member-based associations to aggregate a large group to offer lower-cost coverage to their members, who might be small businesses or even self-employed individuals facing much higher costs. There were three successful bills in this category, and they received bipartisan support before the Governor killed them. You can see the bill history on Senator Siobhan Dunnavant’s Senate Bill 1689 here.
  • Allow short-term plans to expand from 90 days of coverage to 364 days, with two possible renewals for almost three years of coverage. Even though legislation failed, federal rules now allow that, and Virginia’s regulations have been amended accordingly. There were two bills passed in this arena, both with bipartisan support and one receiving a 40-0 vote in the Senate. That was Senator Bryce Reeve’s Senate Bill 1240.
  • Allow for high-deductible catastrophic coverage plans, authorized now under the federal ACA for individuals under age 30 who qualify for a hardship or affordability exemption. There were also two bills on this topic, one of which passed the Senate 38-2. That was Senator Glen Sturtevant’s Senate Bill 1027.

None of those details, including the initial bipartisan support, come through in the heat of a campaign season. Instead the voters are told that the bills “let insurance companies deny coverage for pre-existing conditions.” That particular claim was ruled “false” by PolitiFact, which noted that short-term plans extended to 364 days administratively even though the bill was vetoed.

PoliticFact’s journalistic yellow card has done nothing to stop the election rhetoric, which is testing whether the federal ACA has now become a political third rail entitlement similar to Social Security. Republicans who voted against expanding Medicaid in Virginia, and even some who voted for it, are also charged with mortal sins against Obamacare, “denying health care to 400,000 people.”

And in a year when monopoly utility donations were expected to be radioactive, it is donations from the insurance industry and health care providers which draw attacks. Again, a basic check on the Virginia Public Access Project reveals those donors have spread about $10 million quite evenly among both parties, perhaps paying for the ads which now imply their corruption.

At a Thomas Jefferson Institute policy forum one year ago, survey results from the National Federation of Independent Business revealed health care cost as the number one concern of its members. More than half ranked it as a crucial concern, far above any other on the list. Small business advocates were at the forefront advocating for the lower cost, limited benefit alternatives.

Governor Ralph Northam’s vetoes of these and similar bills in 2018 are all based on the claim that anybody who can leave the highly mandated benefit structure of the ACA will do so. He points to those who are healthy or those who know they won’t need some of the mandated services, such as maternity care.

In his veto message on Dunnavant’s bill, typical of all of them, Governor Northam called it: “concerning for several reasons. Association health plans (AHPs) are not required to cover essential health benefits including maternity care and prescription coverage. Additionally, AHPs would be able to set different premium rates based on characteristics like age, gender, job, and preexisting conditions. This bill would undermine current efforts to stabilize the Virginia health insurance marketplace. Virginians who enroll in AHPs may be disproportionately healthy when they enroll leading to higher premiums for Virginians who do not qualify for an AHP and remain in the marketplace.”

On Sturtevant’s bill seeking to expand catastrophic coverage, the Governor wrote this: “Catastrophic plans typically have lower premiums because they require individuals to (pay) very high deductibles before the plan pays for health care costs. Many individuals enrolled in a catastrophic health plan may forego medical services because of cost.” In the real world of private employer coverage, high deductibles are also commonplace, and those customers also sometimes forego services to avoid them.

Is no insurance at all the better choice for those with no employer coverage?

The bills in question were all sponsored by Republicans, and the lack of bipartisan sponsorship made the vetoes easier, despite the bipartisan floor votes. The Senate Republican Caucus in particular highlighted these ideas, none of them unique to Virginia and several of them already in place elsewhere.

When Northam vetoed the association health plan bill, after proposing a failed amendment to reduce its scope, the Senate Republicans reacted angrily, questioning whether the Governor really is committed to finding solutions for those who can’t afford or do not want the full ACA coverages.

“Considering this administration’s previous actions on legislation that would have made healthcare more accessible and affordable for individuals, today’s decision to deny small businesses and their employees the same options is disappointing, but not surprising,” said Senate President Pro Tempore Stephen D. Newman (R-Bedford), Chairman of the Senate Education and Health Committee. “With this veto, the Administration has reaffirmed its rigid insistence on a ‘one-size-fits-all government-knows-best’ policy on healthcare coverage.”

The voters may not realize it, but they are now being asked to endorse the “one-size-fits-all government-knows-best” approach on November 5. If they do, that may end efforts to create flexible lower cost alternatives in Virginia.

Stephen Haner is Senior Fellow for State and Local Tax Policy at the Thomas Jefferson Institute for Public Policy.

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