[ Report Home | Previous Page | Next Page ] Governor Perry’s War Chest: Who Said ‘Yes’ To ‘Governor No’?   II. Introduction: The Power of the Veto Pen

The defining moment of Texas Governor Rick Perry’s administration came six months after he inherited the Governor’s mansion from his predecessor, who became president of the United States. On Sunday June 17, 2001, Governor Perry risked carpal tunnel syndrome by vetoing an astonishing 78 bills. Combined with four other vetoes on slower days, Perry vetoed a record 82 bills (his closest competitor in recent history, Governor William Clements, took down 59 bills in 1989).

What soon became known as the Father’s Day Massacre was shocking not only because of the sheer number of legislative casualties but also because the governor marshaled the element of surprise, springing the Massacre as an ambush. Many sponsors of vetoed bills said the Governor’s Office never expressed any concerns about their bills until he vetoed them. This in a state that still remembers the Alamo, where even Santa Ana offered terms of surrender and played the Degüello¹  before initiating the slaughter.

To be sure, lying amidst the wreckage when the smoke cleared were some bills that richly deserved the death penalty. Indeed, Perry has brandished his veto sword as proof that he is a leader who can stand up to special interests.²  But he invokes this counterspin against a much broader, Daddy-Warbucks perception that he wielded his veto pen on behalf of special interests rather than against them.

The “prompt-pay” bill (HB 1862), which would have strengthened a health insurer’s legal obligation to pay health-care providers quickly, was by far Perry’s most prominent veto. The sponsor of the bill, Rep. Craig Eiland, its chief advocate, the Texas Medical Association (TMA), and Perry’s own Insurance Commissioner all said that the Governor’s Office offered no pre-Massacre indication of impending veto.³  The doctors trade group says the prompt-pay veto bowled it over because Perry hailed this legislation as a milestone of the just-ended session when he addressed the Texas Hospital Association on June 4.⁴

Perry’s stated rationale for vetoing this milestone just two weeks later is also noteworthy. Perry said he vetoed it because of a provision that would interfere with health insurers imposing arbitration on health care billing disputes. Businesses use binding arbitration to divert disputes from civil courts, which still guarantee plaintiffs some semblance of the rule of law and the rights to: a jury trial; an appeal; and some level of transparency. While consumer groups oppose binding arbitration because it robs litigants of these fundamental protections,⁵  the business tort group Texans for Lawsuit Reform (TLR) promotes binding arbitration as a centerpiece of its legislative agenda.

The point man who helped both TLR and HMOs defeat the prompt-pay bill was lobbyist Mike Toomey, an ex-legislator who is a close friend of Governor Perry. For Perry, who took six times more money from physicians than the $95,147 that he took from health insurers (other insurers gave him $888,782 more), TLR’s weight may well have triggered the eleventh-hour, prompt-pay veto. TLR’s PAC and supporters have given Perry more than $3 million, making it “the single largest source of campaign funds for Mr. Perry,” according to the Dallas Morning News.⁶

After the veto, the powerful TMA fumed that it was outgunned by its former ally (TMA and TLR both have bankrolled candidates who support strict limits on medical malpractice lawsuits). “It’s the political equivalent of us going in thinking it’s a fencing match. And they walk in with automatic weapons,” said TMA staff lobbyist Kim Ross. “We weren’t even in the ballpark in terms of political weight.”⁷  Although big donors often say that they contribute without expectation of political favor, TMA President Tom Hancher said after the Massacre that doctors would “withhold their support of Governor Perry pending their review of these issues and how they’re addressed in the coming year and a half.”⁸  The TMA endorsed Perry’s opponent “by an overwhelming majority” in April 2002.⁹

To what extent was Perry’s formidable veto power a fundraising magnet? The accompanying graph plots the monthly amounts of money that Perry raised between June of 1997 and June of 2002. His three fattest months were:

• October 1998 ($1,994,082): Perry shoots the moon on the eve of the election, squeaking past John Sharp to become Lieutenant Governor with 50.04 percent of the vote;¹⁰
• June 2001 ($1,948,392): The month of the Father’s Day Veto Massacre; and
• December 1998 ($1,706,074): The last chance for special interests—especially former Sharp backers—to board the “late train” and curry favor with the Lieutenant Governor elect before the 1999 legislative session (during which contributions are prohibited).