The underlying point of my story last night on Mitt Romney's boasting about his state's 2002 tax hike in a presentation is that the raters don't care about your inevitably overstated theories about whether tax cuts or targeted spending will spur economic growth; they care about balancing the books.
And Josh Green made a very similar point in an item about Sarah Palin's success with S&P as Governor of Alaska:
[The ratings increase] is unquestionably a good thing for the people of Alaska, just as the country's downgrade is a bad thing. The state enjoys lower borrowing costs as a result. But especially in light of the current dysfunction in Washington, it's important to understand why Alaska's fiscal situation improved: It was largely because Palin raised taxes. Specifically, the state oil tax. Her central achievement as governor was signing a law, Alaska's Clear and Equitable Share (ACES), that dramatically increased the state's share of oil profits just as oil prices began to take off. There's a direct line between increased revenue and improved fiscal health.
The gap between the anti-tax purity of the national GOP and the more complicated position of governors is the consequence of governors having to actually balance budgets.
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