Like former Democratic Gov. Bob Holden, Nixon will face a budget shortfall and a Republican-controlled legislature. Six years ago, the budget crisis led to a political nightmare. Holden refused to propose a budget that could be balanced with existing revenues and the Republican legislature rejected Holden's proposals for tax increases.
"What I hope that everybody learned from the years I was in the governor's office is that political rhetoric does not solve problems," Holden said in a recent interview reflecting on his administration.
Facing an economic recession
Earlier this month, the state of Missouri was officially declared to be in an economic recession. Nixon's budget adviser has predicted a $342 million budget shortfall for the current fiscal year that will end June 30, 2009.
Holden faced Missouri's worst economy since the nation-wide recession of the early 1990s. The state was officially in recession in November 2001, following the first depressed quarter in 10 years and the sudden economic downturn due to the Sept. 11, 2001, attacks.
"We became aware of how tight the budget was," Holden said. "We very early on realized that the leadership of the House and the Senate under the Republicans' control -- the atmosphere was gridlock. The strategy was not to solve the problems, but to leave them at the governor's doorstep, which I think was unfortunate for the state."
One year after taking office, Holden faced a near-$1 billion deficit, which he addressed with multiple budget cuts and proposed tax increases. But his revenue-increase efforts met with stiff and unyielding opposition from the Republican legislative leadership.
Holden still expresses frustration with the situation.. When asked if Nixon should try to raise taxes, Holden said the governor-elect simply needs to analyze the situation seriously.
"That's a decision that every governor has to think about candidly and at their own peril, because the public doesn't understand the situation," Holden said. "People want more services at less cost, and we're all that way in everything we do in life."
Jason Crowell, the 2004 House Republican Floor Leader, said Nixon should not pursue a tax hike, based on results from Holden's and Blunt's terms and how they addressed the economy.
"I don't think we're going to be able to tax-increase our way to prosperity," said Crowell - now a GOP state senator from Cape Girardeau . "That's what Gov. Holden wanted to do. Missourians said, 'No, you're not raising taxes; you're going to live within your means.' And under Gov. Blunt, that's what we did."
Before the recent economic downturn took its toll, Blunt's administration produced a $281 million surplus, in contrast to the $1 billion deficit that Holden encountered seven years ago.
The 2004 Budget Committee Chairman -- then-Rep. Carl Bearden, R-St. Charles -- agreed with Crowell.
"I think that today's environment is very similar to the environment we faced a couple of years ago, with some differences about the ongoing economic slowdown," Bearden said. "But a Democratic governor could begin by proposing a budget that doesn't increase spending by a tremendous amount -- particularly one that's not there."
Nixon will take office during the worst economic recession since possibly the Great Depression, said his transition budget adviser, former Sen. Wayne Goode. Goode, had chaired both the House and Senate budget-writing committees during decades' of service in the legislature.
But there is no easy solution, regardless of who is working alongside you, Bearden said.
"There are still a lot of challenges out there," Bearden said. "There's not a magic wand that we wave; there's not a person who's a Superman or a Superwoman who can solve this.
"I think he's got a start with someone who knows the system at least, and then hopefully they will make some good recommendations about the places that can be reduced, while increasing others," Bearden said.
Dismantling communication roadblocks
Like Holden, Nixon will enter office as a Democratic governor facing a Republican majority in both the House and Senate.
Republican leaders during Holden's gubernatorial term point to party politics and ineffective communication as dividing the general assembly from the governor's office.
Crowell said a gag order Holden issued to his office staff was the biggest source of conflict between the General Assembly and the governor's office. Because the governor's staff was restricted from communicating directly with the general assembly, Crowell said legislators did not have the resources to make completely informed decisions.
"Our position was always, 'This is not the governor's information -- this is the people's information, this is the state of Missouri's information,'" Crowell said. "And it did cause issues, and caused us to craft a budget that probably wasn't as good as Missourians deserved, because the governor wouldn't cooperate with sharing information with department heads or other individuals."
Crowell said the House tried to combat the gag order by investigating it.
"But that was stonewalled by the administration, all the way up to and through the Joint Committee of Legislative Hearings and Oversight," Crowell said.
Holden said he tried to connect with Republicans in the General Assembly but that, in retrospect, he could not have treated the Republicans any differently.
"It was obvious that the leadership was more interested in looking at it through political eyes, than governmental eyes," Holden said. "They made the decision that there was not going to be room for compromise, and that's unfortunate because I think you do need, in our political process, a sense of compromise."
Rod Jetton, the Speaker Pro Tem of the House during part of Holden's term, said the different parties simply had different agendas.
"Clearly, when you have two different parties in control, you're going to pass much less legislation than you would have if you had the same party in control, because things are just going to roll quicker," said Jetton - the current out-going House speaker. "But sometimes that's not the best thing. It's the best thing to have a compromise."
Leaders from both parties encourage strong communication as an effective starting point for Nixon, whose term begins in similar circumstances.
Crowell said Holden was not interested in having one-on-one discussions with members of the opposing party. He also said he appreciates Nixon's reaching out to various leaders, such as his inviting Senate and House leadership to his office after the election.
"I think he is a leader of a different cloth, and wants to discuss and communicate -- and where we disagree, we disagree," Crowell said. "That's healthy. Boy, what a boring world this would be if everyone thought and agreed with me."
Holden said his first priority if elected now would be to seek discussion and common agreement with leaders from both parties.
"If there is no agreement there, to want to try and solve a problem, it's hard to negotiate your own demise," Holden said. "And that's the situation I found myself in as governor."
Because the Republican majority has held its majority for two years, Jetton said party politics should now have a lesser role in any conflicts between the General Assembly and the governor's office. Having had a governor from both political parties in the last two terms has also helped smooth the bumps, he said.
"I think now that we've been through this party switching in the past eight years a little bit more, now people realize that you're not going to get your way," Jetton said. "You're going to have to work with the other side."
Looking to the future
As a former Democratic governor who faced a similar economic and political landscape, Holden has a few recommendations for Nixon, who will assume office on Jan. 12, as well as for the legislators who will open session on Jan. 7:
Overall, Holden declared confidence in the leadership that will walk the State Capitol Building halls in January.
"I think we've got good people," Holden said. "I think Jay understands these issues, and I look forward to his leadership."