George Allen and Tim Kaine before their debate at the state Capitol in December (AP Photo).

Former governors, now competing U.S. Senate candidates George Allen and Tim Kaine each laid out their economic plans in Roanoke this morning, drawing contrasting visions for the country’s energy policy and how best to avoid the so-called “fiscal cliff” set for the year’s end.

Both men appeared separately before the Virginia Economic Developers Association at the Hotel Roanoke and Conference Center. A banner behind the stage included the motto for the VEDA’s fall conference — “Recovering from an economic hangover!” — and audience questions to each candidate aimed at preventing a relapse by pressing them for details on their plans to avoid a more than $1 trillion in automatic across-the-board cuts over the next decade and the expiration of the Bush-era tax cuts.

Republican Allen said he’d “start with what the House passed in May,” which cuts $380 billion from social programs like food stamps and Medicaid while protecting national defense. Allen supported a plan by presidential candidate Mitt Romney to audit federal agencies for more efficiency. He called for repeal of the Affordable Care Act, or Obamacare, which he said would save up to $1 trillion in spending.

Allen said the tax code needed to be reworked for small businesses, and he said he’d encourage the use of domestic energy sources to produce royalties from lease sales and spur the economy, which would in turn produce more revenues. Allen also favors the preservation of the Bush-era tax cuts in their totality.

Democrat Kaine, on the other hand, called for those tax cuts to expire on annual income above $500,000. That figure, he said, is a compromise between the Democratic stance of preserving the cuts for income up to $250,000 and the Republican stance of keeping them all. He said that change would produce increased revenues of $500 billion over 10 years.

Kaine said Congress should make a challenge to allow the federal government to negotiate with drug companies on the price of pharmaceuticals for Medicare, which would save a projected $240 billion. Third, he said the government should cut out subsidies to the five biggest oil companies, which would save $24 billion. Kaine said Congress can find targeted savings to make up the rest of the cuts needed to get to $1 trillion.

On energy, Kaine endorsed a variety of sources while calling for innovation. He trumpeted Dominion Virginia Power’s hybrid power plant in Wise County as “the cleanest coal plant in the country and probably the world.” And he underlined a key difference with Allen in his call for more investment in renewable fuel sources, which he called “the energy economy of the future.”

“If you don’t think humans affect climate, then you don’t think carbon is a problem, then there’s no need to fund alternative energy,” Kaine said. “But if you do think humans affect climate, then you do wrestle with the notion that we’ve got to do something about carbon, and the best thing we can do about carbon in my view is invest in low- and no-carbon energy.”

Kaine said that’s already happening, citing work in the solar and wind sectors at the General Electric plant in Salem, but he called for more investment to make the United States a leader in the “$2.3 trillion global industry that is alternative energy.”

Allen took a different path, repeating his call for the country to tap into its stores of oil, natural gas and coal. He called for exploration and mining of oil and natural gas reserves off Virginia’s coast.

Allen also blamed the Environmental Protection Agency under the administration of President Barack Obama for promulgating regulations that he said have shackled the coal industry and put it at a competitive disadvantage. Allen said the result has not just been an economic downturn in the coal counties of Southwest Virginia, but a trickle-down effect that’s negatively affected support industries such as the railroad and a general increase in electricity prices that has challenged businesses everywhere.

He said that Kaine “refuses to oppose these regulations that simply outlaw coal and doesn’t even allow coal to compete with natural gas or any other source for affordable electricity,” Allen said.

Both candidates cited case studies Southside and Southwest Virginia as examples of their respective economic philosophies.

Allen talked about economic development as a “team effort.” He talked about bringing a distribution center for Dollar General Corp. into Halifax County during his term as governor. When Dollar General officials expressed a concern about finding qualified truck drivers and the potential to go looking for them in North Carolina, Allen said he worked with local officials to develop a truck-driving school at Southside Virginia Community College.

Kaine talked about working with state House Republicans to develop and pass a higher education bond package that helped pay to establish the Virginia Tech Carilion School of of Medicine. Kaine said that project highlighted how government can best help encourage economic development: It had bipartisan support, utilized a public-private partnership and included local and state partnerships. And it will help build what he calls a “talent economy” that trains Virginians for the jobs of the future.

Allen and Kaine will meet Oct. 18 at Virginia Tech in their final debate of the campaign.

– Mason Adams