by Kelcy Whitaker
Governor Chet Culver has launched a new campaign ad as the gubernatorial race begins to pick up. His ad is entitled “Stronger Than Ever,” and focuses on the state’s economic situation and his actions as governor. The campaign ad states, “When floods ravaged Iowa, Chet Culver led our recovery; when Wall Street collapsed, Chet invested in Iowa’s future; during the worst recession since the depression, Governor Culver decisively cut state spending, cut his salary and balanced the budget, without raising taxes. National publications praise Culver’s ‘good fiscal management’ and say Iowa is one of the best states to do business. We can rebuild Iowa, and come out of this recession stronger than ever.” In a Des Moines Register blog Andrew Roos, Culver’s campaign manager, is quoted saying, “Governor Culver has taken these challenges head-on, managed the state responsibly and made smart investments that will help Iowa emerge from this storm stronger than ever.”
Another Register blogger is unhappy with how Governor Culver has led the state of Iowa. Katie Koberg states that every great thing that Culver has done as governor has simply been a reaction and that he has “never once led on the topics he touts as strong for Iowa.” She notes how the ad says that Culver has “acted decisively,” but says that he has only “signed his name on bills which government could not afford” and that he has “also waffled on what a 10% cut is on his salary,” which before the cut was $130,000 a year. Koberg continues by claiming that Culver’s “good fiscal management” is inaccurate because within only five months after signing the budget Culver has “had to implement an unprecedented 10% across the board budget cut to balance the budget.” The blogger also attacks the campaign’s claim that Iowa has been named the fourth best state for business with saying that “according to US News and World Report, Iowa is one of the 7 worst places to start a business and the Tax Foundation lists Iowa as one of the 10 worst states to do business.”
Former Governor Terry Branstad has also publicly criticized Governor Culver. The Quad City Times reported Branstad accused Culver of “fiscal mismanagement and floating millions of dollars in debt that will not create long-term, high-value jobs.” Brandstad alleges the state is now facing “dire financial straits because of Culver’s overspending and shortsightedness.” The reporter notes that Roos responded, saying that the state has a current AAA bond rating and has also been applauded by rating agencies.
In late October, Culver ordered an across-the-board 10% budget cut to all state departments, and requested that all department heads also take a 10 percent cut on their own salaries, just as he had done. This signifies the decisive cut to state spending and the cut to his salary emphasized in his ad “Stronger Than Ever.” Iowa House Speaker, Pat Murphy (Dem.), has said that the budget cuts should go “deep enough to leave the state some breathing room,” the Telegraph Herald reported. The Speaker is also quoted as giving details of how, “As an added cushion [to the current budget cuts], we still have $419 million in the state’s reserve accounts, plus $133 million in unspent federal stimulus funds,” and Iowa would therefore have a balanced budget when the end of the fiscal year comes around June 30, 2010.
The Culver Administration maintains it has taken on the toughest economic crisis since the Great Depression and confronted the nation’s fourth worst national disaster, and made tough decisions while standing up for the families of Iowa. Governor Culver’s web site declares that he implemented the $830 million I-JOBS program without a tax increase and that the program is paid entirely by existing gaming revenue. Governor Culver also dealt with last year’s floods by bringing in over $1.6 billion in federal disaster recovery funds. His position as Governor has also been credited with raising the state’s minimum wage and has expanded the earned income tax credit.
This leads to the claim the Governor Culver has not raised taxes, which is more of a stretch. The Iowa Department of Revenue shows there was an increase in the Sales and Use Tax in July of 2008, from 5 percent to 6 percent. The Department of Revenue states that the increased statewide tax is set to run until 2030 and replaces the current SILO tax, which is imposed by individual counties on behalf of its school districts for the repair or improvement of its infrastructure. However, the state sales tax rate is still at 5% for hotel, motel, and bed and breakfast room rental, sales of certain construction equipment, and the auto rental tax. During the governor's tenure, gasoline, diesel, Ethanol, and E85 tax rates, with totals increases of .3 cents, 0 cents, 0 cents, and 2 cents per gallon, have increased a bit. The largest new tax increase is on cigarettes (a dollar a pack), passed in March of 2007. While this is a tax increase, countering what Culver implies in the ad, individual or corporation income taxes have not increased.
LESSON: Governor Culver’s ad states that he has governed the state of Iowa with fiscally sound management, that he has balanced the budget, cut state spending and his own salary, all without raising taxes. While state spending and his personal salary have been cut, it is not determined whether the fiscal year-end report will be completely balanced. He has not raised income taxes but did hike a few other taxes and fees. Whether Governor Culver has led Iowa with “good fiscal management” can be left to Iowans to decide for themselves.