Borg: Switching seats. Iowa statehouse observers say November's election could shift the balance of power. We're discussing issues driving the statehouse campaigns with democratic majority leader Kevin McCarthy and republican minority leader Christopher Rants on this edition of Iowa Press.
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On statewide Iowa Public Television this is the Friday, October 24th edition of Iowa Press. Here is Dean Borg.
Borg: Iowa's key role in the battle for the White House is a way of detracting attention from Iowa legislative campaigning but there's plenty of drama there too. In the Iowa senate democrats are now holding a 30 to 20 advantage over the republicans but the house margin is much closer. There democrats are holding a 53 to 47 advantage with all 100 seats in the house up in this election. And that means when the 83rd general assembly convenes in mid-January there could be a significant balance of power change. Joining us today are legislative leaders whose future roles depend on the outcome. Sioux City representative Christopher Rants leads the house minority republicans now and Des Moines representative Kevin McCarthy leads the majority democrats. Gentlemen, welcome back to Iowa Press. You're familiar faces here and on the campaign trail.
Borg: Also at the Iowa Press table Des Moines Register political columnist David Yepsen and Radio Iowa news director Kay Henderson.
Henderson: Gentlemen, let's give Iowa Press viewers a real idea of what is going on on the ground. Representative McCarthy, what are the prospects for democrats who are seeking seats in the Iowa house?
McCarthy: Well, first of all, being a member of leadership trying to maintain the majority is a difficult job and just to start maybe in a moment of bipartisanship here I want to say hats off to Christopher Rants because he did it for I don't know how many cycles but it is a lot of work, it's a lot of work. There's not much of a personal life during this particular time because there's so much going on and it is a tough job. I think the infrastructure has been laid for our democratic majority to retain the majority and that is our primary job and there's a potential to pick up seats. I don't want to be too braggadocios though because the bulk of what is going to determine these legislative races is going to be what's going on at the local level. I really believe that it's the strength of our local candidates and what they're talking about locally and how hard they're working, whether they're writing postcards, whether they're door knocking, that's going to determine a major part in whether we are successful. I think that a couple of weeks from now because of the financial situation we're in nationally and because of the quality of candidates we have and because of the funding that we have here from the state party perspective we've got a good shot at maintaining control.
Henderson: When you say maintaining control, Representative Rants I'll get to you in a moment, does that mean you win 53 seats? Does that mean you'll win 55 seats? Does that mean you'll win 60 seats?
McCarthy: We have a goal to pick up seats but in the end it's hard to have some sort of large prediction, there's too many variables that occur, we still have a lot of time left. A week and a half is still a lot of time in politics but we think we're poised to potentially expand our majority.
Henderson: Now to the republicans, Representative Rants, what is going on on the ground and what are prospects for republicans who are running for the legislature?
Rants: We have our sights on 51. We know that we have a bit of a head wind that we're running into, that makes it a bit of a challenge. One of the challenges that republicans have is we have a number of open seats that we have to defend. We have a number of long time legislators who chose to retire this year and so we have to aggressively defend those seats and then turn around and go after democratic incumbents to get the job done. But we like our prospects. We think we have an excellent group of candidates, people with real experience, we've got a number of locally elected officials be it city council people, we've got three city councilmen running for the legislature, people with real world experience in their background be it people like Jared Klein who is a fifth generation Iowa farmer, Ross Posten who is also a multi-generation Iowa farmer from Scott County, we've got people that are well regarded in the communities that are working very hard. The challenge for us has been for a while trying to match some of the fundraising that the democrats were able to do early on. We don't have the unions that give 99.9% to one political party as Representative McCarthy does but we're pleased when we look at the last round of disclosure reports we're in the game, we've raised roughly the same amount of money the democrats have, we've kept a little bit more money in the bank and so we think that we're well positioned to run the ads, do the mail but it is up to the candidates to knock on those doors and seal the deal with the voters.
Yepsen: Mr. McCarthy, what is the democratic message of this campaign? Give me the commercial here. Why should an Iowa voter vote for a democratic candidate for the Iowa House of Representatives?
McCarthy: We are in a national economic recession right now and I don't think anybody would deny that. That has really shaped the dynamics of these races. So, our message is pretty basic, that if you want a candidate or party that is going to be governing on ideology then don't vote for us. If you want a party that is going to be focused on mainstream bread and butter issues, job security, healthcare security, the focus on reducing our dependence on foreign oil then we're the party for you. So, it's basically bread and butter issues that affect the average, ordinary Iowan. That is the message. Nothing flashy, just bread and butter issues.
Yepsen: Mr. Rants, why should the democrats be replaced and why should Iowans vote for republicans for the Iowa house?
Rants: That's kind of a long answer, there's a lot to talk about. In 2006 in Iowa and nationwide people from the nation's capitol to the courthouse tossed republicans out and put democrats in charge. Over the last two years things have gotten worse, they haven't gotten better. We're in a budget deficit situation, actual budget deficit situation in Iowa right now. Democrats have raised taxes on family farmers, they have raised taxes on small business people, they ran not on bread and butter issues during the session, they ran on things like gutting Iowa's right to work act, forcing people to join unions, ending our collective bargaining laws in the state. That is heading this state in the wrong direction. Republicans, however, are offering an agenda that is about a property tax freeze, protecting Iowa's right to work law and strengthening our education standards in the state and those are the things we're going to do in the first four weeks of the general assembly.
Yepsen: We want to get to some of those but Mr. McCarthy, how do you respond?
McCarthy: I visited with State Treasurer Mike Fitzgerald this week and wanted to get his take on the national economy and the state of Iowa economy and his belief is, and it's my belief as well, because of this national economic downturn that we're in that Iowa because of the stewardship that we have provided for the economy is probably better than most any state in the country to withstand this national economic downturn. We have the largest amount in our reserve funds in the history of Iowa, $624 million in our reserve funds. That is a position of strength to go in if we do have a rainy day here in Iowa and the economy has been tightening up here in Iowa. Also Standard and Poor's came out just a few weeks ago and upgraded us to the highest level of bond rating, AAA bond rating and they praised our fiscal stewardship over the past two years. So, we have balanced the budget, we have record reserves and we're in a position to really withstand this national economic downturn.
Rants: Let's talk about both of those things for just a moment if I may -- when you say that Standard and Poor's raised our bond rating, you know, Fannie Mae has a AAA bond rating too. You're actually comparing Iowa's fiscal health to Fannie Mae's fiscal health that put this nation in the problem that we're in right now. I'm sorry but that doesn't reassure Iowans to say that we're in as good a shape as Fannie Mae is especially at a time that the people who issue those bond ratings are in front of congress today having to explain why they inflated those ratings to get market share. Second of all, when you say that we have record high revenues, excuse me, record high dollars in our reserve accounts, the reserve accounts are a percentage of the state budget. That tells you that we have a record high state budget and the fact is we are still spending more money right now, we have an actual deficit in the state where revenue estimating conference lowered our reserves, the Medicaid estimating conference increased the amount of money that we have to spend on Medicaid and we don't have enough money today to pay the bills and we're only four months into the fiscal year.
Borg: Mr. McCarthy, I'll give you a chance to respond to that and at the same time my basic question is what difference is it going to make if democrats control the Iowa house, which we're talking about here, given that democrats also control the senate and the governor's chair? What difference is it going to make?
McCarthy: I think it's largely a question of philosophy and how you approach governance. Just to give you a couple of examples here and it's partly in response to what was just issued by Representative Rants here, all session last year they pushed forward a tax cut proposal for big businesses and we resisted that because we didn't feel that we could afford to do that. Then as part of their flood relief proposal they came out with the same proposal of tax cuts for wealthy businesses and then two weeks ago they released their 2009 economic agenda, item number one the same tax cut proposal for big businesses. If you believe that somehow trickle down economics in a tough time you give tax cuts to wealthy corporations, you give tax cuts to the Laboshkins in Postville, let's say, and somehow that is going to trickle down to middle class families in Postville then vote for the republicans in this race because as a matter of economic philosophy I think what we're going to be doing is saying where is the role for government. There's a role for government regulation. There's a role for government to try to intervene if people's homes are being foreclosed on. And there's a role for government in security with regard to healthcare. There's a role for government in regard to renewable energy. But not big government, not little government, not government of the 1970s and 1980s but there is a reasonable role for government to play. That's the difference, economic philosophy.
Borg: Mr. Rants, same question to you only I'll ask it this way. What difference are Iowans going to notice if republicans control the Iowa house and lose control, again, of the senate and the governor is not up for re-election so that's a democrat.
Rants: Well, first of all, republicans will pass this tax cut. It's not for big business. It is for small businesses, Main Street businesses, anybody who invests. Maybe it's a shopkeeper who has to buy a new cash register, maybe it's a farmer who has to put up a new grain bin.
Borg: But the difference is are Iowans going to know this if republicans only control the house?
Rants: Well, for starters if republicans only control the house that means the democrats can't repeal Iowa's right to work law like they've tried to do the last two years. That means they won't take Iowa's collective bargaining law and turn decisions that are made currently by school boards over to out of state arbitrators like they tried to do last year. It means that we won't have millions of dollars in pork bill spending all going into Des Moines like we've had for the last two years. It means that we won't raise taxes like they've done for the last two years. It means we won't have another billion dollar increase in spending like we've had for the last two years. A republican controlled house provides a check and a balance of the runaway spending, on the increase in taxes and the liberal social agenda that ahs been running unchecked for the last two years because democrats have control of everything. I think Iowans know that there needs to be some checks and some balances to hold people accountable.
McCarthy: I just need to respond just very briefly to this. Under republican stewardship in 2000 and 2001 they took out $400 million out of our cash reserves. I know it's easier when you're in the minority to throw bombs and throw a lot of parts in the rhetoric, it's harder to govern but we have record amounts in our reserves, they are there, the money is in the bank and that is something that we look forward to having as a tool as we fight this national economic downturn.
Rants: Who proposed that? Which governor proposed that?
McCarthy: Which governor proposed what?
Rants: Taking money out of the reserves? Which governor proposed that?
McCarthy: What difference would that make?
Rants: Well, it was Governor Tom Vilsack, a democrat.
McCarthy: Did you vote for it?
Rants: And at the time revenues had fallen, we were in an actual situation where revenues were declining and we worked in a bipartisan manner with the democratic governor to keep the budget healthy so that we could make our school aid payments on time.
Henderson: Representative McCarthy, what is your relationship with the current Governor Chet Culver? He vetoed a piece of legislation that you advanced through the house.
McCarthy: I think our relationship is good, it's solid, it's strong and it's improving. I had dinner with the Governor just a few days ago and one of the subjects of that dinner is to figure out a way to better communicate not so much between him as a chief executive and us as a particular legislative leader but more as an institution and that involves staff interplay and how do you give somebody a heads up if you're exploring something. And we were all new, he was a new governor and we were a new legislative leadership and I think it's a lot of that interplay and some rough edges there and I think that we're growing in other ways and we have a good, solid relationship.
Henderson: Speaking of rough edges, Representative Rants, there already seems to be sort of a circular firing squad among republicans who are already complaining about the election before the election is actually held.
Rants: At the national level?
Henderson: And at the state level as well. What is your relationship with your state party? Is it healthy? Is your state party as an organization healthy?
Rants: I think that part of the problem that you have any time you slip from majority party to a minority party is there does tend to be a lot of what happened and finger pointing and blame. And that frankly isn't helpful. House republicans are focused on one goal and that is getting back to 51, getting back to 51 seats. We are working as a caucus to raise the money. We worked as a caucus to recruit the candidates. And we're working as a caucus to win those elections. I know that there is some controversy going on with our national committeewoman and the Meek's campaign and things of that nature ...
Henderson: Two candidates, Christopher Reed and the fellow who is running over in the first congressional district David Hartsuch have complained about the party openly.
Rants: Fair enough. But I am the leader of the house republican caucus and I have only one goal and that is to elect house republicans and find 51 folks on Election Day.
Yepsen: Mr. McCarthy, I want to go back to your meeting with the governor and I want to put up a real fine point on this question. He vetoed a bill to open scope collective bargaining as it's been referred to here. Have you worked out the differences with the Governor on that? Is he going to sign something? Will you pass something different? What's going to happen on that issue in the next session?
McCarthy: We have not had a conversation about that issue in terms of any policy matters. What we've talked about is creating a structure to have good conversations about those and other issues. That piece of legislation that we passed we were disappointed in its veto, I know others were happy with the veto. 29 states have the law including South Dakota and Nebraska and Wisconsin and Minnesota and Illinois and so we will be able to pass some version of it but we have a framework now to have those conversations in a much more productive way.
Yepsen: Chapter 20 is on the table, correct?
McCarthy: Expanding the scope for cops and firefighters and teachers would be something that we would look at but it's not something that is an agenda item yet.
Yepsen: How about changing anything to do with the right to work law?
McCarthy: No, we will not be repealing the right to work law. Keep in mind that Iowa's right to work law is Chapter 731. There was never a bill that's even come out of subcommittee that has dealt with Chapter 731. The state legislature ... I need to finish my answer please. There is a bill that came out of committee but that was Chapter 20.8 regarding fair share for public sector workers. That was a different argument all together than Chapter 731 which is way over here. No bill has ever come out of subcommittee on that topic.
Rants: Oh come on, folks, you didn't campaign on it last time. In fact, you said on Iowa Press before the session started we're not doing that. That wasn't being honest with Iowans. You weren't honest with Iowans about it in the last election. The very first year democrats were in control you did try to end right to work. When you forced non-union employees to pay union dues that is taking away right to work in the state. Secondly, your newspaper, David, called what the democrats tried to do being disrespectful to Iowans because they tried to shove it through in the middle of the night without school boards, city councils or county supervisors knowing. The Governor, after a long time, finally vetoed that bill. He said it was not good public policy and it would raise property taxes in the state. When you look at the campaign contributions from AFSCME, the IOCA, the SCIU, all the public sector labor unions it's coming back and house democrats will tell you privately it's coming back. They will absolutely pass that bill again.
Yepsen: Mr. McCarthy, do you care to respond?
McCarthy: What we're going to be doing this year the Governor has to propose a budget to start out the legislative session and policy agenda items and we're going to be working with the Governor to see what he wants to do to move Iowa forward and to help out middle class families. Some of that may involve working men and women in labor unions. We don't view that as a bad word.
Yepsen: We need to move onto other issues.
Rants: That wasn't a denial, by the way.
Yepsen: Can we move on? There's been some talk about a special session to help flood victims in eastern Iowa. Is that a likelihood after the election or in the month of December?
McCarthy: The pressure on that kind of balloon that was expanding to have a special session has lessened a little bit because money is starting to flow now. Federal money, we just learned $23 million that is coming to the state right now for infrastructure reimbursements. There's intergovernmental transfers that were done this summer due to the executive council. That money is flowing now. So, because there is actually money and dollars reaching the street in flood affected areas that has lessened the need for a special session. I know from the Governor's perspective that there is a delay that happens on setting some HUD money, something stops and we need to have a special session prior to the second week of January we will do that if we need to but at this time it doesn't look like we're going to have to have one.
Henderson: Representative Rants?
Rants: It's a shame. What is happening to the people in eastern Iowa in their hour of need the state government turned its back on them. You had city council members, you had county supervisors asking the legislature to come in and make some code changes to give them more flexibility, to try to help the people of Cedar Rapids. But you know what, democrats decided we don't want to come into a special session because we don't want to expose the fact that we have a budget deficit and we don't have any money to help people with.
Borg: But what would have been different? What would have been different for those flood victims had the legislature met in special session?
Rants: Well, we should have come in and made some changes to help the local school districts with some cash flow crunches. We're going to have a tough time. You've got 9000 homeowners that aren't in their homes, are going to have a tough time paying their property taxes this fall. You have a situation where the accountants in Cedar Rapids and Iowa City have suggested, you know what, instead of raising taxes on these businesses that have to replace all their inventory, have to replace all of their machinery, they have to replace all of their equipment don't make them pay more in taxes to do that. That's a tax change that we could have made to help those businesses that got washed out in the floods but we didn't do that.
Henderson: Speaking of paying more taxes the Iowa Good Roads Association is running radio advertisements urging Iowans to tell legislators to raise the gas tax to pay for repairs to roads and bridges. Will legislators vote to raise the gas tax?
McCarthy: Two things, one is those that are making that argument -- and there are legislators on both the republican and democratic side that are making that argument -- are concerned of this -- disproportionately Iowans are bearing the burden to maintain our roads. 30% of the people that drive on Iowa's roads come from other states. And those that are advocating the gas tax want to capture that from the out-of-state drivers that are driving on the highway roads. My personal opinion I have not been sold on that concept yet because it is not the right time with our economy right now. We did pass a bill last year that is a start putting a lot of money into our roads and so I haven’t been sold that it's the right time to move in that direction. If the economy improves in the future then maybe if there is a bipartisan discussion we could look at that but it's not something that's on the agenda for this legislative session.
Henderson: Representative Rants?
Rants: I don't think so and I'll tell you one reason why. I can tell you two different campaigns in this state, I'll use Dan Rasmussen for an example, Dan Rasmussen up in Independence opposes a gas tax increase. The democratic party are sending out mailings, four of them now, that say Dan Rasmussen proposed a gas tax increase. That's a lie. It's flat out untrue. Dan Rasmussen didn't propose it, doesn't support it, would never vote for one. He's opposed to raising the gas tax for some of the reasons that Leader McCarthy said. When you start lying about an issue like that that's not the way to build public support for something. So, I don't think that there will be a movement to raise the gas tax in the future of the general assembly.
Yepsen: So, what does that mean for Highway 20 up in your part of the state?
Rants: Highway 20 just scheduled a five year project so we're pretty happy. There's plenty of other -- have you driven around Des Moines lately? There's plenty of other highways that currently need DOT projects. We did provide additional resources to the TIME 21 funding this year. But I think given the way that issue has been politicized this year I think it's a dead issue for the next couple of years.
Yepsen: Budget. Mr. McCarthy, there is concern and you mentioned it about the rising need for Medicaid dollars for healthcare for poor people. At the same time your tax revenues are going down. What are you going to do about that?
McCarthy: That's a cautionary sign too on our Iowa economy because last quarter we picked up about 13,000 new people that are now eligible for Medicaid, that's a troubling sign. One of the things that we're looking at with regard to our budget in general is ways to think outside the box to try to make sure that we can still provide services so we don't balance the budget on the backs of middle class Iowans but meet priorities such as healthcare, such as Medicaid. We're exploring something in cooperation right now with a lot of medical providers in this state. Some of the nursing homes are calling it quality assurance fee. But what they're wanting to do is to pay some money that will come back to them via a two to one federal drawn down that would be millions and millions of dollars from the federal government. The formula of how it works is far above my pay grade to kind of figure out but we're looking at ways that we can try to draw down more federal dollars in this quality assurance assessment that providers are talking about that could bring in tens of millions of dollars into the state, take care of our rebates and obligations and help ease the burden of our Medicaid budget crunch.
Henderson: Representative Rants, you voted against the smoking ban in public places. Now bar owners are not only suing over that issue but some bar owners are agitating for the re-institution of amusement devices, machines that earn them a little bit of money in their places of business. Do you think the legislature will vote to give bar owners back those amusement devices?
Rants: I think that's unlikely.
Rants: I think the legislature sent a message a while ago, a couple of years ago loud and clear that they didn't want to have 100 or 1000 casinos in the state. And in both chambers democrats and republicans oppose that. I just don't see that issue coming back. I think bar owners are right to be angry. I think that a number of bar owners have seen a drop in revenue and they are agitated thus far by what predicament they're in. I just don't see the general assembly bringing gambling back into all the bars.
Henderson: Representative McCarthy?
McCarthy: I agree with that actually. There is a legislator from northeast Iowa who is working with some others on a bill like that but from my perspective I don't think the legislature will have critical mass to go there. I guess I just don't see it happening.
Yepsen: Mr. Rants, we've got less than a minute. I have to ask you a political question. Double digit leads in Iowa for Barack Obama and Tom Harkin. You see what is happening nationally. Are you worried that republican legislative candidates could get swamped?
Rants: Of course I'm worried but here's the thing, David. Two years ago in 2006 Iowans gave control of all aspects of government to the democrats. Things have gotten worse. They haven't gotten better. If Iowans truly look at pocketbook issues, look at the taxes, look at forced union dues, look at the state budget, look at the collective bargaining, those kinds of things that's being harder on Iowa families, it's not being better. They may vote for Barack Obama, they may vote for Tom Harkin. I'm not suggesting they do, I'd prefer they vote for McCain and Reed. But if they do I hope that they will look closely at what is happening at the state capitol and decide, you know what, we need some checks and balances, we care about these sort of kitchen table pocketbook issues and the only people that are answering their problems are the republicans.
Yepsen: Mr. McCarthy, democratic surge?
McCarthy: I hope so but, again, these races are decided locally. I think our message is, very briefly, that we have a national economic recession and if you want a party that is going to focus on mainstream bread and butter issues and work in a bipartisan way to try to solve our problems then I hope you support your local legislative democrat.
Borg: And with that we need to say thanks for sharing your insights with us today. Thank you. On our next edition of Iowa Press on the weekend before the 2008 general election we're convening Iowa political journalists for our final analysis of the campaigns. You'll be hearing from David Yepsen, Mike Glover, Kay Henderson and Jeneane Beck on the candidates and the issues and you'll see the Reporters' Roundtable at the usual times, 7:30 Friday night and 11:30 Sunday morning. Before we leave today Iowa Public Television and Iowa Press are honoring a true giant in Iowa broadcast journalism and a friend of ours for a long, long time. Grant Price was 85 years old at the time of his death in Waterloo on Friday, October 17th. For the past 62 years, since 1946, Grant was a fixture in the Iowa news front, first at KTRI in Sioux City, then KXEL in Waterloo, WMT in Cedar Rapids and KWWL in Waterloo. Particularly at the WMT radio and TV stations in Cedar Rapids and then Channel 7 in Waterloo Grant developed nationally respected news departments and sent many journalists on their way to national and international reporting careers. On a personal note, as his assistant Grant approved my participation in the very first Iowa Press panel 37 years ago. His work ethic and integrity is legendary. He was recognized with countless awards including the prestigious Jack Shelley Award for excellence in broadcast news. But then after retiring from active news broadcasting Grant went on to be a professor at Wartburg College building a stellar program for training broadcast journalists in an academic setting. Additionally Grant served public television sitting on IPTV's board of directors as the statewide network experienced some of its biggest advances. His counsel, advice and insights will be missed by us all and we lost a dear friend. That's it for this weekend's edition of Iowa Press. I'm Dean Borg. Thanks for joining us.
Funding for Iowa Press was provided by Friends, the Iowa Public Television Foundation. The Iowa Bankers Association, for personal, business and commercial needs Iowa banks help Iowans reach their financial goals.