John O'Leary
The house sits at the very top of a mountain, which, on one side, abuts a whole range of similarly shaped dun-and-green monoliths within the Great Smoky Mountains National Park.
On the other side, the house overlooks a valley that, on this midsummer morning, is hidden beneath what would appear to be miles and miles of cumulus cloud cover. But it’s really only a thick mist down there that, as often as not, greets the morning and this home’s inhabitants, a couple who begin each day by walking out and admiring the view from the wraparound deck that was built, like the multileveled house itself, to their own specifications.
When the mist clears, as it will by mid-morning, another spectacle appears — the veins and rivets of a landscape, thick with forest and with various steepled and gabled structures, each of them hitting the architectural middle between a cabin and a manse. These nearer houses belong to the gated resort community of Laurel Valley. Rooftops can also be seen farther out, in the surrounding East Tennessee hamlet of Townsend (population, 207), a mail-drop community equidistant from nearby Maryville and Gatlinburg and only a modest drive away from Knoxville.
You might want to call the vista idyllic, except that there are trees downed around the house from where a massive storm had just struck the area the day before, and from the front side of the house, a ragged tear is visible in the sheared woods across the road, where the national park begins. That scar was carved out a few weeks earlier by the same tornado front that devastated the college town of Tuscaloosa down in Alabama.
Don and Martha Sundquist live here, some 400 miles from their onetime Fox Meadows ranch house in Memphis and 175 miles or so from their intervening residence, the Governor’s Mansion in Nashville. Like other couples of retirement age, they kick back a fair amount, but they make a point of staying active, Don by playing golf on the 18-hole course that belongs to Laurel Valley and rings the foot of the mountain — “just $25 a round; you can’t beat that” — and Martha by hiking the several trails that meander on for miles through the adjacent national park. The damage from the tornado and the later storm have forced her to alter the course of her treks, but both Sundquists are of Middle-Western stock, descended from generations of Swedes (and some Germans on Don’s mother’s side) — people accustomed to making the best bargain they could with the elements.
Nature in the abstract is by no means their only possible threat. Bears lurk in the vicinity and have clambered up onto the deck, leaving paw prints on the external walls. To guard against them, the Sundquists have installed an electrified wire that rings the house. On the deck side, it is parallel to the top of the wooden restraining rail, just a foot or so below, within easy reaching distance if someone leaning on the rail should get careless and drop an arm.
“It hasn’t happened yet,” says Don Sundquist, but just the same he deactivates the current by means of an internal switch when he has potentially unwary friends over. Otherwise, he doesn’t worry about it. He is, after all, no stranger to risks.
Donald Kenneth Sundquist, who served two terms as governor of Tennessee, from 1995 to 2003, has been honored so far by having his name attached to four of the Volunteer State’s prominent institutions — the Don Sundquist Advanced Technology Center in Cookeville, the Sundquist Science Center at Austin Peay University in Clarksville, the Don Sundquist Center of Advanced Technologies in Fayetteville, and the Don Sundquist Wildlife Management Area, near Huntsville.
These locations are spread throughout the state, but, whether through oversight, neglect, or some other cause, there is as yet no Sundquist memorial in Memphis, nor, for that matter in West Tennessee — despite the fact that Sundquist served a huge swath of the state’s westernmost Grand Division for 12 years as congressman for the sprawling 7th District and was a longtime resident and respected citizen of Memphis at the time of his elevation to the governorship.
Perhaps in time Sundquist will be remembered locally in some equivalent to the Winfield Dunn College of Dentistry at the UT Center for Health Sciences or the McWherter Library at the University of Memphis — official tips of the hat to two of his gubernatorial predecessors, former Memphian Dunn, a one-termer who in 1970 became Tennessee’s first elected Republican chief executive (Sundquist would be the second), and Ned Ray McWherter of Dresden, the Democrat whose two terms immediately preceded those of Sundquist.
Sundquist, now 75, professes not to be concerned with honorifics. What bothers him more, as a longtime eminence of the state’s Republican Party, is that many GOP types have considered him for much of the last decade to be, as he puts it, “radioactive.” This has been “painful,” Sundquist acknowledges ruefully during our conversation in the media room of his Townsend home in late July, particularly “when we put more Republicans to work than anybody had ever done and helped build the party as much as anybody has ever helped build the party.”
The former governor recapped the several decades of his party activism, which began as a Young Republican at Augustana College, the Illinois institution which he, a native of Moline, attended, along with wife-to-be Martha, and continued, with time out for two years in the Navy, through the several years of his employment as an executive with Josten’s, the company that supplies yearbooks, class rings, and other items familiar to most American high-schoolers. During an itinerary that took him to Shelbyville, Tennessee; Minneapolis, Minnesota; and finally to Memphis — where, with partner Frank Rosenberg, he would form his own printing and advertising firm — Sundquist’s loyalty to the GOP and service to its causes were unvarying constants.
Sundquist served, inter alia, as an organizer of the Goldwater-for-President campaign in 1964; as president of the national Young Republicans, as chairman of the Shelby County Republican Party; as national youth chairman for the reelection of President Richard Nixon in 1972; as Howard Baker’s choice to manage his national headquarters for the Tennessee senator’s 1980 presidential-campaign effort; as congressional chairman of the 1988 presidential campaign of George Herbert Walker Bush; as Southern whip for Minority Whip Trent Lott in the House of Representatives; and, during the years of his political prominence in Tennessee, as a party recruiter, fundraiser, and circuit-rider. “I did Lincoln Day after Lincoln Day,” he says, recalling his countless, virtually nonstop round of speeches at the annual Republican banquets in all of the state’s 95 counties.
In 1982, a recession year which saw Republicans lose incumbencies and races for open seats everywhere in the nation, Sundquist had been prevailed upon to make a pro forma stand for the Republicans in the 7th Tennessee District, which had been newly configured in the wake of the 1980 census as a walk-in for Middle Tennesse Democrat Bob Clement, the politically ambitious son of former governor Frank Clement. Instead of regarding himself as a sacrificial lamb, however, Sundquist crafted a methodical election plan that was dependent upon his holding his own in the district’s rural counties while running strong in Shelby County. Against all odds, he eked out a narrow victory by 1,026 votes out of 145,744 cast; he would hold that seat for the next 12 years, making it something of a cornerstone for a statewide Republican dominance to come.
After all that, what could possibly have made Sundquist persona non grata with so many of the GOP faithful after his easy reelection to a second term as Tennessee governor in 1998? To those who turned against him, the answer was summed up in two words: income tax. As Sundquist himself saw it, he was merely doing his job as chief executive in proposing what began as a business tax and evolved into an income-tax variant he likes to characterize as a “flat tax.”
By whatever name, it turned into a political third rail for Sundquist’s career and legacy — and led to disturbances that stopped just short of civil conflict.
It all began when Tennessee’s tax revenues in early 1999 began a drastic and unexpected decline. “The recession that hit in 2000-2001 had actually begun in 1999,” Sundquist says. “Nobody in the state, no economist, no one thought that our business tax was going to collapse like it did. We had to do something,”
What he proposed to a stunned General Assembly that spring was a reform of the state’s existing business-tax structure, aimed at, among others, “the biggest professionals — doctors, lawyers, dentists — who for the most part got their higher education in Tennessee but pay virtually no taxes to the state.”
As Sundquist saw it then and sees it now, “They pay taxes to the feds and skip the state. If those people would pay their fair share of taxes, we could fund education. It’s just not right. . . .
Nobody disagrees that we ought to be a low-tax state, but we have to have a fair-tax system that is not regressive, and when you’ve got the people who make the least amount of money paying sales tax on food and clothing, it’s not fair. Then you’ve got all these professionals who are paying virtually nothing. Oh, they’ll tell you, ‘We pay a tax, a fee for our licenses.’ Just bull!”
That original proposal, somewhat modest overall, was stymied in 1999, but the financial crunch faced by the state refused to disappear, and both Sundquist and the legislature began a quest for fiscal solutions that continued throughout the governor’s second term. The legislators’ efforts would run to such stopgap expedients annually as co-opting an ad hoc tobacco tax whose proceeds were supposedly dedicated to specific health programs, or raiding the state’s Rainy Day fund or, in an inspired move at the close of one session, merely declaring that tax revenues would rise during the coming year to a level commensurate with the state’s needs.
They didn’t, of course. In fact, that year they fell. Meanwhile, working with Chief of Staff John Ferguson and policy advisor Justin Wilson (“We had 14 different plans!”), Sundquist evolved his business-tax proposal into the more comprehensive policy change that, in one form or another, he would offer in the legislative years 2000 through 2002.
“What we were going to do was eliminate the sales tax on food and clothing and reduce the basic sales tax.” The latter, then maxing out at a rate of nearly 9 percent, including local options, would decline all the way to 3.75 percent, and the existing Hall Tax on income from interest and dividends would also be reduced. The kicker: “We proposed a flat tax and a constitutional amendment that would not allow it to be raised without a two-thirds vote of both the House and the Senate.”
And that “flat tax” — on income, of course — would be deductible in full from the payer’s federal taxes. “We would have increased our revenue dramatically, and the average Tennessean would pay a lot less.” Two-thirds of all Tennesseans would have had their tax burdens reduced, Sundquist maintains.
“I knew I was going to catch holy hell. But when you’re elected to office, you take an oath to balance the budget. You take an oath that you’re going to make life better for people. And to me, that transcends politics. You’ve got to do what’s right as near as you can. If the economy hadn’t collapsed, I doubt I’d have done anything along those lines. We were sailing along. I should have; I should have done it regardless. But now we were facing a $500 million shortfall and a business tax that was going like this.” Sundquist straightened out a palm and took it on a rapid nose-dive straight downward. “We had to try something.”
The anticipated “holy hell” wasted little time in coming. The man who had highlighted so many Lincoln Day events and received so many rounds of applause at them would now be introduced on such occasions to perfunctory handclaps, if even that, and would find himself addressing tight-lipped throngs who would keep a perfect silence through his remarks, only to shower other Republican speakers on the dais with enthusiasm that seemed exaggerated by contrast.
And there was the case of Chip Saltsman, Sund-quist’s former driver and the son of Bruce Saltsman, his still-loyal transportation commissioner. The younger Saltsman had now become state Republican chairman, and, in a stunning act of repudiation, had the state Republican Committee go on record as opposing the governor’s tax-reform program, an action, says Sundquist, that convinced rank-and-file Republicans, in and out of the legislature, that they could — and should — resist his initiative.
At the political level, opposition developed from assorted legislators and professed conservative spokesmen like Saltsman and one of his predecessors as state party chairman, Tommy Hopper. And the flames of public discontent were fanned by Phil Valentine and Steve Gill, right-wing radio broadcasters in the Rush Limbaugh mode who dominated the Nashville market.
For nearly the entirety of Sundquist’s second term, protests raged almost daily whenever the legislature was in session. Squawk sessions were held on War Memorial Plaza, across the street from the Capitol in Nashville, and Valentine and Gill took to doing their talk shows from there. Caravans of angry motorists rode all-day circuits around the Capitol Building, honking their horns nonstop. It was an early version of the phenomenon that would later be called by the name of Tea Party.
The Governor was meanwhile working both sides of the aisle, and Jimmy Naifeh, the longtime Democratic Speaker of the House, became a virtual partner. But Sundquist and those who strove along with him discovered that legislators who had pledged to support him on tax reform got cold feet. And the problem went beyond talk shows and noisy cavalcades. “They [the anti-tax advocates] found opponents for them,” Sundquist says. “They got scared.”
Even so, there came a time, in the summer of 2001, when success seemed close at hand. And, to this day, Sundquist blames the ultimate collapse of his hopes on another onetime beneficiary. To him, Marsha Blackburn was Chip Saltsman writ large.
Blackburn was a winsome ex-Mississippian and GOP activist whose political base was arch-conservative Williamson County, part of the posh suburban ring that had grown up around Nashville as the state’s capital city began to boom in the latter part of the twentieth century. She had run in 1992 for a congressional seat in the state’s 6th District and lost to Democratic incumbent Bart Gordon. From the governor’s office, Sundquist tossed her a political life raft, naming her chairman of the state Film and Tape Commission.
There is no disputing that Blackburn threw herself into her duties, a fact that would generate as much unease as satisfaction in the governor’s office. Several former Sundquist aides tell a tale of her returning from one Hollywood jaunt and presenting claims for reimbursement that included a huge bill for limousine rental. Allegedly, when they insisted that Blackburn include a full package of receipts with her reimbursement request, she was furious and returned days later with a bag containing the receipts — all burned to a crisp and reduced to ashes.
Still, Sundquist gave Blackburn political support and fundraising help in 1998, when she was running for the state Senate and he for reelection after what had been an untroubled first term. Both won those races handily.
By July 2001, Sundquist had finally put together his bare-bones tax-reform coalition, somewhat more Democratic than Republican but one that included a fair share of GOP loyalists. The state Senate was scheduled for a key vote of an evening, and all seemed well. But Marsha Blackburn saw this as her Paul Revere moment. That afternoon, when she had learned of the upcoming vote, Blackburn opened up her state-issue laptop and, as some routine issue droned on around her, she began sending out email alarms to Gill, Valentine, and all the other anti-income tax activists she knew.
By evening, as the legislators gathered for their key vote, so had a teeming crowd of opponents. Numbering eventually in the thousands, they swarmed over the Capitol grounds and forced their way inside, challenging the best efforts of state troopers to restrain them. They filled the corridors, shouting angry slogans and periodically pounding on the heavy oak doors of the Senate chamber. Wendell Moore, the governor’s chief of staff, was upstairs in the gubernatorial suite when a brick came crashing through the window, creating what the shaken aide would later describe as a “football-sized” hole.
There was damage to other windows and doors. Though apologists for the crowd would later deny that there was violence, state Senator Mark Norris of Collierville, an income-tax opponent and a conservative’s conservative who has since become Senate majority leader, would write an op-ed for the Memphis Flyer in which he condemned the destructive actions of what he called a “mob” and deplored its chilling effect on senatorial debate.
Somehow the Senate got through the evening but without taking a vote on an income tax. Nor did they consider an alternative cost-cutting measure that Norris had in mind to introduce.
Though Sundquist and his allies would keep on trying for another year, that evening in July 2001 would turn out to be the high-water mark for his tax-reform effort. Like Poe’s raven, however, the threat of financial shortfall continued to hover over state government and would force the governor’s hand during the legislative session of 2002, his last. Though Sundquist had often and eloquently spoken against the “regressive” effect of the sales tax, it would now prove his only expedient. “I ended up raising the sales tax because we were up against the wall at the end of the fiscal year.” At 9.75 percent, with all local options applied, the Tennessee state sales tax became one of the highest in the nation.
Don Sundquist has never stopped thinking of himself as a conservative Republican. Though the term “tax reform” became a euphemism of sorts for some income-tax proponents, Sund-quist expressed it with conviction, always emphasizing that the changes he envisioned would not only reduce taxes for most Tennesseans but also allow for more efficient collection and, he ventured, stimulate the economy.
During his first term (1995-99) he had prided himself on a welfare reform package that emphasized taking people off the dole and easing them into the work force. The package was no arbitrary cutoff but included state subsidies for childcare, job re-training, and transportation. It made for a 60 percent reduction in the welfare rolls and became, Sundquist contends, a model for other states.
And Sundquist prided himself on his pursuit of fiscal economies. His first finance commissioner on taking office in 1995 had been Bob Corker, the diminutive and head-smart Chattanooga entrepreneur who would later become a U.S. Senator from Tennessee. “He told me, ‘You’ve got a problem, the state’s in the red.’”
“I don’t think it was Ned,” Sundquist says, making an effort to exculpate McWherter, whom he invariably describes as “my buddy.” (A pre-inauguration picture of the outgoing McWherter with his arm around the incoming Sundquist at the gate of the Governor’s Mansion is prominent on one of the several obligatory photo-walls in the Sundquists’ mountaintop home.) But the key issues did indeed seem traceable to Sundquist’s predecessor — an unbudgeted post-election pay raise for state employees, granted in November 1994; and especially TennCare, the innovative state-operated version of Medicaid sponsored by McWherter.
“TennCare was never a health plan,” Sund-quist maintains. “It was a way to finance government by drawing matching federal money.” But the program was expanding massively and its internal costs had already begun to spiral. It became expensive, very expensive. But I did my best to support it and keep it going.”
All in all, Sundquist recalls, “I found out we were $300 million down when I took office. I had an austerity program right away. Several times we managed to have lower budgets than the year before. During the previous 20 years, the rate of growth in state spending had been between 10 and 12 percent. In my years it was around 6 percent per year. We almost cut the rate in half, in spite of [federal] mandates in mental health, prisons, and education.”
Sundquist attempted to freeze state employment. “After eight years we had less than a thousand new employees, even allowing for all the mandates.”
He claims to have lowered the per capita cost of state prisoners during his eight years, mainly through the expedients of extensive privatization of facilities and “double-celling” prisoners (“something they told me I wouldn’t be able to do”).
He also managed to raise funding for the B.E.P. (Basic Education Program), McWherter’s other major initiative. “We started testing at-risk pre-school children, we started charter schools, and, thanks to Dr. Walter [Memphian Jane Walter, Sundquist’s first education commissioner], we were the first state to have the Internet in every classroom. We attracted $42 billion in new investment, more in eight years than McWherter and Lamar [Lamar Alexander, Republican governor from 1979 to 1987 and now a U.S. Senator] did in 16 years. We reformed children’s services. We did a lot of things very well in eight years.
He shakes his head slightly. “But it was all overshadowed by the economy and the problems we had trying to reform taxes.”
There are numerous things to look at in the Sundquist household — the fossilized prehistoric fish embedded in a stone-top table; an entrance floor cobbled together with redstone slabs (“I told them I wanted the rough sides up”); prints from sources as diverse as Peter Max, Josie Stern, and Howard Dean (yes, that Howard Dean, a fellow former governor); photographs by Howard Baker, Sundquist’s former mentor (“not a good photographer, a great one”); a restored platform rocker from the ex-governor’s Swedish great-grandmother; a vintage wooden icebox, now serving to collect odds and ends; an antique tavern table with slots for beer bottles, used by Sundquist as a study table in his media room; a 1920s-vintage barber pole from Chicago; pieces of the now-demolished Berlin Wall; other artifacts of all kinds from a peripatetic career that, long before Sundquist had run for public office, had taken him on foundation-supported fact-finding missions to places like Russia and China when these were still exotic venues for Westerners.
There are framed notes (like one from George H.W. Bush which says, “Please stick your head in before you leave the White House”)
and photos of Sundquist and Martha with both presidential Bushes and all manner of other political eminences — Richard Nixon, Bill Clinton (“I like him a whole heck of a lot”), Ronald Reagan, Rudy Giuliani, John McCain, and virtually every Tennessean of political consequence during Sundquist’s lifetime — Baker, Bill Brock, Al Gore, Fred Thompson, Bill Frist, McWherter, Harold Ford Sr., Bill Haslam, etc., many of them appearing several times over.
Two figures are conspicuous by their absence — or in the case of one, Phil Bredesen, the Democratic ex-mayor of Nashville who lost to Sundquist in the 1994 gubernatorial race but would succeed him as governor in 2003, by his near absence. Bredesen actually turns up in at least one pro-forma group portrait of ex-governors, gathered on a state occasion. Van Hilleary, however, who carried the GOP standard against Bredesen in 2002, is nowhere to be seen.
In the course of serving a sumptuous Continental-style breakfast (eggs, toast, fruit, enough lavish pastries to tempt a Gandhi), Don and Martha do some reminiscing about the aftermath of that tumultuous second term and the election that followed it. The Sundquists possess the Scandinavian virtues. They are friendly and hospitable to a fault and own ready smiles, with any negative emotion taking shape slowly, like the formation of ice. A tiny bit of frost shows on their faces when Bredesen is discussed; it hardens with the mention of Hilleary.
In 2002 Hilleary was the Republican congressman from the 4th District, and, so far from showing any allegiance to his titular party chief, he chose to focus his primary and general-election campaigns for governor on what he perceived to be a bitter aftertaste in Tennessee concerning Sundquist’s three-year struggle to achieve tax reform. In what both Sundquists regard as a crowning insult, the Republican candidate that year flooded the state with bumper stickers that read simply, “Bredesundquist.”
Martha recalls, “All my friends were so upset they voted for Bredesen,” and she shoots a confiding look that suggests she concurred with them. As if to account for so strange a preference, given the known coolness between himself and his Democratic successor, her husband notes further about Hilleary: “He tried to use that [the income-tax issue] to help himself politically. He didn’t even carry Knox County. I think it cost him the election. Van Hilleary earned what he got. Most people don’t like meanness and attacks.”
Martha: “They could have run against the tax thing without getting personal.”
Sundquist declines to say how he himself might have voted in that election. But the satisfied way with which he says, “Oh, I voted,” affords something of a clue. Going on to muse about the strange conjunction implied by the term “Bredesundquist,” he points out that “anybody that knows our relationship would not believe that.”
Sundquist will discuss Bredesen but prefers to keep much of what he says off the record. Suffice it to say that Sundquist resents the fact that Bredesen never even went through the motions of consulting with him after the transfer of gubernatorial power, and that he regards his successor as having trashed his legacy without acknowledging either the accomplishments of his administration or the financial bump Bredesen derived from Sundquist’s reluctant sales tax increase.
Chattanooga Times-Free Press reporter Andy Sher, who logged time in Washington during the early 2000s, recalls an occasion when Bredesen and Sundquist happened to converge on the same spot during an after-hours D.C. reception. He remembers the silence as deafening.
Though he is scaling back his activity, Sundquist stays in touch with the world of government through the lobbying firm, The Sundquist Group, which he founded and heads. On that matter of a legacy, Sundquist seems serene in the expectation that history will absolve him. He enjoys his house, his pending retirement, and the frequent occasions when he and Martha are able to entertain old friends and their three children — daughters Tonya and Andrea and son Deke; all three stay in touch with their parents on a daily basis, and are all now successfully making their own way in the world.
On many a day he will go to have lunch at a homey little place off Highway 321 called Riverstone, where he can eat country-style food and indulge in avuncular banter with waitresses he calls Putt-Putt and Mostly Martha . “It’s a good thing I’ve got the same name as his wife,” the latter says, grinning and no doubt trying to imagine the alternatives. Though everyone in the restaurant, as in the community, knows who Sundquist is, he makes no effort to carry himself like a squire; as a result, he fits in and is accepted like any other member of his plainspoken rustic community.
Asked who his political heroes are, he names the obligatory GOP icon Reagan, then Lincoln (“It’s amazing how disloyal some of his people were”), and Harry Truman (“He really did what he thought was right”).
He keeps up with political events, sort of, and — again, off the record — is able to give the names of a few Tennessee figures he considers “wingnuts,” employing a current political usage that probably few would think him familiar with. He is eclectic in his commentary, conferring conditional approval upon current Governor Haslam’s educational reform package, including the revocation of teachers’ collective bargaining that was tacked on by Lt. Gov. Ron Ramsey (though adding that, in general, “Haslam seems to have just gone along with things”), and deploring “silly legislation” like the “Don’t Say Gay” bill introduced in the last session by Knoxville state Senator Stacey Campfield.
He has followed the presidential race and takes some satisfaction from the apparent early demise of the candidacy of former House Speaker Newt Gingrich, whom he never cared for when he was in Congress (perhaps because Gingrich, “to make it look like he was doing something,” abolished a committee on technology that Sundquist, a would-be tech nerd, was proud to belong to). Sundquist, who got somewhat screen-shy during the income-tax battle, is now an inveterate watcher of cable news shows, though he has a hard time with opinionated types like Keith Olbermann (“I’d throw my TV away if I had to watch him”), Bill O’Reilly (“He wears on you”), and Glenn Beck (“He’s goofy”).
He has opinions of his own, though — one of the most unshakable being his conviction that the flat-tax version of an income tax that he proposed for Tennessee and that will forever be coupled with his name was, is, and will be the right solution for the citizens of his fiscally challenged state. Would he do it all over again? “Absolutely,” he says, with no hesitation at all. “It was the right thing to do.”
