Howard Dean's Vermont legacy: TIE's co-executive editor, who has known the Democratic presidential candidate for years, offers the inside story.

• Author: Hale, David

The emergence of Howard Dean as a leading contender for the Democratic presidential nomination is naturally provoking interest in his record as governor of Vermont. The governor argues that he is a fiscal conservative because he consistently balanced the budget despite the lack of a constitutional mandate to do so. The media have generally accepted this assertion and portray Dean as a moderate chief executive.

The reality is much more complex. There is little doubt that Dean preferred a middle way in many areas of public policy but his freedom of action was greatly constrained by four factors. First, Vermont has a long tradition of high public spending which also requires a tax burden above the national average. Second, Dean inherited a program of fiscal austerity from his predecessor which shaped policy choices during his initial years. Third, Vermont's courts mandated changes in education spending which led to the most far-reaching transformation in the structure of Vermont government since the 18th century. Finally, Vermont requires its governors to seek reelection every two years. Such an electoral schedule limits the potential for politicians to promote structural reforms except when special circumstances prevail. Dean did not face any serious re-election challenges during his initial years but he did face a populist revolt tit the cud because of court orders promoting educational tax reform and gay marriages. The Dean legacy is very much a byproduct of both Vermont's political culture and the revolutionary changes mandated by the courts.

Vermont was a one-party Republican state before the 1960s. But it was not a conservative state. The state had a long tradition of high public spending because of its political structure. Vermont had a legacy of strong town governments ("Little Republics") and practically no county or regional governments. The towns were powerful because each of them had a seat in the state legislature irrespective of its population size. In 1900, 20 percent of Vermont's citizens elected a majority of the legislature. The ten largest towns had 25 percent of the population and 4 percent of the seats. During the late 19th century, many Vermont towns experienced depopulation because their rocky mountainous terrains caused people to move west in search of better land. The decline of the small towns created great pressure on the state government to provide financial assistance in order to maintain public services. The Republicans responded by enacting an income tax during the 1930s and using the funds to provide state aid for education as well as other public services. When the Democrats took power under Philip Hoff during the 1960s, they timber expanded public spending and bequeathed the Republicans a large budget deficit. The deficit was $12.2 million in 1968 or 16 percent of general fund expenditures. The new Republican governor, Deane Davis, persuaded the legislature to enact a sales tax in order to sustain the new spending. As a result, Vermont's state and local government tax burden during 1971 was 14.8 percent compared to 12.1 percent for the nation.

In its period of ascendancy, the Vermont Republican Party supported a high level of public spending and taxation because of its belief that it was essential to provide good public services, especially education. Vermont is also a homogenous state without the conflicts over race and ethnicity that have undermined popular support for public spending in places such as the South. The new development in Vermont politics since the 1960s has been the emergence of a large group of left-wing legislators hostile to business for ideological reasons who favor income redistribution to reduce inequality, not just to finance education. Many of Vermont's left wing politicians me urban dropouts from the 1960s. The most famous is the state's sole member of Congress, Representative Bernie Sanders (I). Sanders is an aging Peter Pan from Brooklyn who regularly wins reelection by campaigning as a left-wing populist challenging the evil ways of big corporations and Washington. Although Dean also comes from New York, he was never a populist and frequently clashed with the left-wing members of the legislature.

Dean became governor in 1991 upon the unexpected death of Richard Snelling, a Republican who had previously served during the late 1970s and early 1980s. He had returned in 1991 to clean up the large fiscal deficits resulting from the 1990-91 recession and the spending expansion during the administration of Democrat Madeleine Kunin. The deficits peaked at $65 million in 1992 or a sum equal to 10 percent of general fund expenditures. Snelling imposed a program of severe fiscal austerity in order to eliminate the deficit. He reduced public spending. He hiked the sales tax rate from 4 percent to 5 percent with a plan to sunset the hike in 1993. He significantly boosted Vermont's piggyback tax rate. Under Vermont's tax system, citizens pay a share of their federal tax liability to the state government. In the late 1980s, the...