Bonus Episode: Business Ranking Tanking

Hi, everyone. I'm Sam Shirazi, and this is Federal Fallout 2025 Virginia Elections. This is a special bonus episode looking at some business rankings tanking in Virginia.00:12.05Sam ShiraziSo, for context, CNBC every year puts out a list of the best states for business, and in previous years, Virginia has been number one, but this year, the top honors goes to North Carolina, our neighbors to the south, and also...00:27.60Sam ShiraziVirginia was ranked fourth. So it definitely fell a few spots in the rankings. Virginia generally is known for its business-friendly climate. Partly that's because the economy is strong. Partly that's because there's a really good education system.00:41.79Sam ShiraziIt's obviously important in terms of being close to Washington, D.C. and having a fair amount of business come because of the federal government. And CNBC, the reason they...00:53.52Sam Shirazicited for Virginia's fall is is basically what's going on in DC. So they said federal jobs cuts disproportionately affect Virginia's economy, a major factor in this year's competitiveness study.01:06.74Sam ShiraziSo CNBC definitely talking about the federal fallout, definitely talking about the impact to Virginia's economy. That's part of the reason Virginia is not the top business state anymore.01:18.59Sam Shiraziand Obviously, this quickly went made its way to the campaign trail. I think Democrats certainly pounced on this issue and pointed to it as a reason why the Republicans should not win this year and the Democrats should be given the opportunity to run Virginia state government.01:36.06Sam ShiraziSo I will just read from what Democratic nominee Abigail Spanberger had to say. So she said, quote, today's rankings make clear that Virginia needs a governor who will build a more resilient economy, expand our workforce and protect our Workers and small businesses in the face of the ongoing threats from Trump's Washington.01:53.65Sam ShiraziSo clearly she's tying these business rankings to what's going on in D.C. and explaining that she will be the one standing up for Virginia in the face of cuts at the federal level.02:04.93Sam ShiraziAnd I'll just read something from Democratic nominee Jay Jones, the nominee for attorney general. He said, quote, over the last five months, Miara is talking about Jason Miara as the Virginia attorney general has failed to protect the over 400,000 Virginias who are employed by the federal government from being fired at random, sitting on the sidelines as other attorneys general sued the Trump administration, unlawful cuts, the federal workforce, end quote.02:29.15Sam ShiraziSo clearly the Republicans are facing some attacks from Democrats, and this is a talking point. Generally, it just kind of is another thing that is the theme the Democrats are trying to talk about this year, that Virginia is under threat from what's going on in D.C. and Democrats are going to stand up for Virginia, whereas Republicans are not standing up for Virginia.02:49.64Sam ShiraziAnd I think that's a pretty clear message. That has basically been the message since the beginning of the year. We talked about Doge and all the cuts to the federal government. I think obviously recently there's been more news about the reconciliation bill that has been passed and some of the fallout from that and potential cuts to Medicaid.03:07.97Sam ShiraziAnd obviously that's an important issue, but this business ranking is kind of more so tied to the cuts in the federal government. So we're going kind of back to that from the Virginia Democrats. So now in terms of the Republicans, obviously this is not great news and not something I necessarily want to talk about, but they're going to have to, and they were asked about it. And so I will read what Governor Glenn Youngkin put out. He said CNBC's new methodology this year is thrown off by a new subjective subjective metric that mistakenly ascribes substantial risk to Virginia from the federal government's presence in the commonwealth.03:42.49Sam ShiraziSo essentially, he's trying to blame it on the refs, say that CNBC got things wrong. He's saying that they're putting too much emphasis on the federal cuts. Now, that's kind of his version of events. And he's saying that the private sector in Virginia is still very strong and that the ranking missed that story.04:01.91Sam ShiraziLieutenant Governor Winston Burrell-Sears had a little bit of a different message from a spokesperson.04:06.54Sam ShiraziHer spokesperson said, this frighteningly is a harbinger of things to come if deafer Democrats continue to stand in the way of smart economic policies that foster growth and opportunity.04:18.18Sam ShiraziSo her message is actually, this is the Democrats' fault. And, you know, I'm not sure that really makes a whole lot of sense because CNBC is Blaming it on the federal cuts. But obviously she didn't want you know, blame it on CNBC. She wanted to blame the Democrats instead.04:33.40Sam ShiraziAnd so we have a little bit of a different message from the governor and lieutenant governor. But overall, they're not necessarily taking responsibility. They're saying that this is not their fault. I think, you know, particularly Governor Youngkin's theory is basically things are fine in Virginia. Economy is doing well.04:49.36Sam ShiraziFederal cuts are not that big of a deal. And CNBC me misread things. And, you know, regardless of the spin on either side, you know, it doesn't matter if the Democrats or Republicans spin is better. The the reality is the reality. And so people are going to feel it. So either Governor Youngkin is right and the economy is doing great in Virginia and everything's fine.05:08.72Sam Shirazior the Democrats are right and the cuts of the federal government have definitely been impacted and there is federal fallout in Virginia from what's going on in D.C. You know, I think the reality is there has been a hit to the Virginia economy, particularly in Northern Virginia.05:24.53Sam ShiraziAnd, you know, you can't just ignore the fact that there had been all these job losses. And, you know, I had mentioned it's not just the job cuts losses you hear about in terms of rifts. I mean, there's been a lot of cuts to federal contracts.05:37.60Sam ShiraziThere are a lot of contractors in Northern Virginia, lot of people who frankly have relatively smaller businesses that contract with the federal government who are being hit by this. And I think it is something that is being felt.05:49.68Sam Shiraziyou know The reality is that most voters are not following the CNBC news business rankings. I mean, maybe some people might see it, particularly in the business community. That might be something that they're paying attention to. But you know the average voter is not you know sitting around you know looking at the CNBC business rankings for the states.06:07.20Sam ShiraziBut I do think it's important in the sense of it's just another thing that we're seeing that could be categorized as a federal fallout in terms of what's going on in D.C.06:18.03Sam ShiraziAnd I think the Democrats certainly saw an opportunity. it's something that reinforces their message. And again, the Republicans have to play a little bit more defense. And you find in these Virginia elections that what happens is the party that's out of power, not in the White House, wants to nationalize these Virginia elections. And anything that happens that isn't going well, they want to blame the on the party that's in the White House.06:43.58Sam ShiraziAnd by extension, they want to blame the Virginia party of the party that's in the White House. And so, for example, we saw that in 2021 when there was the withdrawal from Afghanistan. You know, really, the Virginia Democrats didn't really have a whole lot to do with that. It's not like Terry McAuliffe was calling the shots, but you heard Governor Youngkin talking about it on the campaign trail and trying to tie what's going on in Afghanistan to the Virginia Democrats.07:06.64Sam ShiraziAnd so we see something similar where we're seeing what's going on in D.C. There's a federal fallout and the Virginia Democrats are trying to tie that to Governor Yunkin and Lieutenant Governor Winston Earl Sears.07:18.44Sam ShiraziAnd so they're really trying to nationalize this election and trying to talk about how what's going on in D.C. and in the nationwide is affecting the Virginia virginiaial elections. ah Typically, the party that's out of power is likes to do that, and that makes sense. The party that's in power in the White House likes to focus on more Virginia-specific issues, and you know that is going to be difficult for that to break through. i mean, obviously – When you have someone like President Trump and then he's doing drastic things like cutting the federal government or passing this big reconciliation bill, like that gets a lot of attention. And so it's hard to just run away from that, hard to just ignore it, hard to not talk about it.07:55.64Sam ShiraziAnd I think that's a challenge that Virginia Republicans have is they keep trying to want to talk about their messages, whether it's immigration or crime or trans issues or schools or all these things that they feel like are more political winners from them.08:08.87Sam ShiraziBut the reality is both the media and the voters, i mean, that might not be the top thing that's on their mind because just the reality of what's going on in D.C. sucks up so much attention. And given that Virginia is so close to D.C., what's going on in D.C. will really impact the Virginia elections a lot.08:24.75Sam ShiraziAnd so... You know, that's been a running theme, as you can tell, of this podcast about the federal fallout. I don't always talk about it. I think this was an interesting opportunity to maybe just do a quick podcast, touch base about it.08:36.75Sam ShiraziObviously, this is one ranking. Probably not too many people are going remember it in November. I'm not trying to pretend like this is the biggest issue in the world. This isn't going to decide the Virginia governor's election in all likelihood.08:49.01Sam ShiraziBut, you know, it's this time of the year, it's a bit of a lull. And, you know, I'll do a podcast about the heat check and what's going on this year in Virginia. And I'll talk about that tomorrow on the regular podcast.09:02.20Sam ShiraziBut I do think in this kind of lull time period of the Virginia elections, this is something that's going on that will be important. And it's something that will be talked about. And, you know, it's not something that is...09:16.16Sam Shirazieasy for the Republicans to talk about this year. I think they've continuously had a challenge about how to message what's going on in D.C. And you saw that even with Governor Youngkin and Lieutenant Governor Winston Earl Sears, where Governor Youngkin is talking more about how things are great in Virginia, the private sector is really strong.09:33.27Sam ShiraziYou know, the cuts to federal government aren't a big deal. That's Governor Youngkin's story. Winston Earl Sears' story is more you know Democrats are dragging down Virginia, and this just is more of example of that, and things are going to get even worse if you elect Democrats in November.09:47.19Sam Shiraziand And that's kind of a little bit of a different story, and we'll see which one is going to end up being the main Republican message. i mean, obviously, Governor Yankin is not on the ticket. He's not for election.09:59.61Sam Shirazifor election And so Winston Merle-Sears, she's going to be driving the train and we'll see what her message is this year. And I would say Spanberger, former Congresswoman Abigail Spanberger, she's been very consistent. She's talked about the cuts from D.C. are hurting Virginia. And she's talked about how it's going to be important to stand up for Virginia as the governor.10:17.71Sam ShiraziAnd she feels like the current governor is not doing that. So, again, interesting topic, interesting to kind of touch base, see where things are. I will talk more tomorrow in the regular podcast.10:28.86Sam ShiraziI will talk more tomorrow about this. And for now, that's Federal Fallout, and I'll join you next time. This is a public episode. If you would like to discuss this with other subscribers or get access to bonus episodes, visit samshirazi.substack.com