The issue of whether states should take federal stimulus dollars for expanded unemployment insurance benefits first came to prominence when Louisiana Governor Bobby Jindal said that he would say “thanks but no thanks” to the monies a few days before he was scheduled to give the GOP response to President Obama’s “Message to Congress.”
At the time, Jindal’s position raised the question of whether Bob McDonnell would follow his lead.
The Democratic Party of Virginia and the Democratic gubernatorial candidates pushed hard on the issue, demanding that McDonnell accept the money that was due Virginia.
And Norm Leahy at Tertium Quids (a free-market, individual liberty oriented blog) did yeoman’s work in quickly eliciting a response from the McDonnell campaign.
The gist of the response was that while McDonnell had serious reservations about the stimulus package and disagreed with its emphases, he would not follow Jindal’s lead in urging rejection of federal dollars.
McDonnell noted that Virginians’ tax dollars were paying for the stimulus and we were merely bringing back the monies that we had sent to the feds in the first place.
After Jindal’s nationally televised response to Obama was roundly criticized by Republicans and Democrats alike, the issue went onto the back burner.
That was then.
In recent weeks, however, a number of organized groups in the Virginia business community became very worried that the strings attached to the federal stimulus dollars would permanently raise costs that business could ill afford in the long run.
Wyatt Durette argued on this site that the stimulus program was not narrowly targeted and had the potential of altering the balance of Ameican federalism in undesirable ways.
And the political lines have become more starkly drawn.
Governor Kaine has proposed ways that Virginia should alter its unemployment insurance program so that we can accept the approximately $130 million in fedeal stimulus dollars.
From what I can gather, all three Democratic candidates for Governor support his position.
But Speaker Bill Howell and many of his fellow Republicans have joined forces with the organized groups in the business community to oppose altering Virginia’s program in order to receive the benefits.
There are two questions that come immediately to mind.
The first is simply the pragmatic one of whether Howell and the business community will gain enough support to block Kaine’s efforts.
There are a number of House Republicans who represent areas that have been devastated by the recent economic decline and who may be unwilling to reject expanded benefits, however unpleasant some of the strings attached may be. In addition, Kaine has written the expansion in such a way that a vote against it will be portrayed as a vote against assisting military families and veterans.
The second question relates to the gubernatorial campaign.
Has Bob McDonnell reconsidered his position or does he still believe that Virginia should take all of the stimulus dollars that the Commonwealth can obtain?
I’m certain that the media will be intently covering both questions on Wednesday.
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