Governors Address Challenges Facing States

Panel Composition and Context:

• Four governors from "swing states" (Florida, Wisconsin, Colorado, Virginia) were featured as microcosms of the American political landscape.
• Rick Scott (R-Florida): Second term; former hospital entrepreneur and venture capitalist.
• Scott Walker (R-Wisconsin): Second term; former local government official focused on union reform.
• John Hickenlooper (D-Colorado): Second term; former geologist and Denver mayor; recently married in January.
• Terry McAuliffe (D-Virginia): First term; former National Democratic Committee chairman.

Economic Philosophy and Job Creation:

• Rick Scott (Florida): Prioritizes business attraction via tax cuts and deregulation to combat high costs in neighboring states.
  • Created 1.06 million jobs in 5 years, 3 months.
  • Florida's corporate tax rate is 5.5%, with 80% of corporations paying no tax.
  • Eliminated 4,200 regulations and has no state income tax.
  • Opposes California's $15 minimum wage, estimating 700,000 jobs would be lost.
  • Invested $1 billion in port infrastructure, adding 200,000 trade jobs.
• Scott Walker (Wisconsin): Focused on fiscal stability and labor market reform over five years.
  • Addressed a $3.6 billion inherited budget deficit without raising taxes or laying off over 10,000 public employees.
  • Implemented union collective bargaining restrictions to reduce costs and increase employer stability.
  • Generated over $5 billion in taxpayer savings; unemployment dropped from 9.2% to 4.5%.
  • Attracted businesses from Chicago due to a fully funded pension system and rainy day fund (165x larger than at inception).
• John Hickenlooper (Colorado): Focused on "bottom-up" economic development and workforce adaptability.
  • State unemployment dropped from 10% to 2.7%; job creation ranking improved from 40th to 2nd nationally.
  • Launched "Skillful," a digital platform to track community college skills and create living resumes.
  • Piloted a statewide apprenticeship program for 17-year-olds, combining three days of work with two days of industry-defined schooling.
• Terry McAuliffe (Virginia): Prioritized international trade missions to bypass domestic incentive wars.
  • Secured $11.2 billion in capital investment, including a $2 billion Chinese investment creating 2,000 jobs.
  • Leveraged Virginia's status as #1 recipient of DoD funds (27 installations) while building a cybersecurity and data center economy.
  • Achieved a 4% unemployment rate with claims at a 41-year low.

Federal-State Friction and Policy Constraints:

• Governors identified the inability to print money and lack of control over federal mandates as primary constraints on state governance.
• Medicaid and Entitlements:
  • Florida covered all residents without expanding Medicaid under the ACA through alternative coverage for those in poverty.
  • Wisconsin requires able-bodied adults without children to participate in job training to receive food stamps; 12,000 shifted from assistance to employment.
  • All governors seek federal waivers for state-specific Medicaid implementation to maximize savings and flexibility.
• Sequestration and Infrastructure:
  • Virginia lost $9.8 billion in federal payments due to sequestration, equating to 200,000 lost jobs.
  • Governors criticized Congress for "kicking the can" on sequestration and failing to pass a gas tax-funded transportation bill.
  • Florida funded port dredging projects ($78 million match) and highways independently due to federal delays.
• Environmental Regulation:
  • Colorado negotiated a win-win methane emission reduction deal with oil/gas companies and environmental groups before federal mandates were imposed.
  • Governors advocate for state-level "laboratories of democracy" to set granular environmental standards before federal blanket regulations.

Social and Cultural Policy Decisions:

• Recreational Marijuana (Colorado):
  • Governor Hickenlooper initially opposed the initiative on federal law grounds but enforced the will of the voters (55-45).
  • Generated a $1 billion industry with ~$100 million in tax revenue dedicated to public safety and anti-drug education.
  • Observed a spike in youth usage followed by stabilization; noted reduced street-level drug dealing.
  • Advises other governors to wait a few years to monitor unintended consequences.
• Gun Safety (Virginia):
  • Passed the state's first gun safety deal in 25 years despite the presence of the NRA headquarters.
  • Closed the gun show loophole requiring background checks for all non-federally licensed sales.
  • Implemented a "Red Flag" law allowing a 24-hour surrender period for protective orders, with penalties of up to 5 years in prison for non-compliance.
• Cuba Relations:
  • Rick Scott advocates maintaining the embargo until the Castro regime ends to ensure political freedom.
  • Terry McAuliffe supports ending the embargo, citing economic benefits and a 57,000-person American war memorial precedent; Virginia is now the #1 US exporter to Cuba.

Workforce Development and Education:

• Shift in Focus: Governors unanimously agree the primary challenge has shifted from "creating jobs" to "filling vacancies."
  • Virginia has 30,000 open tech jobs, 17,000 in cybersecurity, with starting salaries of $88,000.
• Training Models:
  • States are moving away from the traditional four-year degree model toward certificates, apprenticeships, and dual-enrollment programs starting in middle school.
  • Florida, Wisconsin, and Colorado are implementing "pay-for-performance" grants for workforce development.
• Target Demographics:
  • 70% of the US workforce does not require a four-year degree; states are focusing training on this demographic.
  • Virginia is aggressively retraining veterans (800,000 in state) and women in STEM fields (only 21% of graduates).
• Caregiving Deficits:
  • Significant shortages exist in elder and child care; 60% of dementia caregivers are currently employed in other sectors.
  • Wisconsin launched a "Dementia Friendly" employer program to support employees caring for relatives.

Public Safety and Crime:

• Florida: Crime rate at a 44.5-year low; juvenile arrest rates dropped 20% via civil citation programs for non-violent offenses.
• Colorado: Focuses on trauma-informed care in schools to address root causes of youth violence (e.g., abuse, domestic violence) rather than purely punitive measures.
• Wisconsin: Piloting "Trauma-Informed Care" in schools to identify and treat students who have experienced abuse or crime.

Global Trade and Political Sentiment:

• Trade Consensus: All four governors support free trade agreements (TPP) as vital for long-term wealth, despite rising domestic opposition.
• Political Friction: Acknowledged a disconnect between governors (pro-trade) and the general electorate (protectionist due to job displacement).
• Global Focus: 81% of future global growth is expected outside the US; governors prioritize international trade missions over domestic incentive games.
• China: Governors warn that without US-led trade rules, China will dictate terms for Asia.

Capitalism and Public Perception:

• Governors attribute rising anti-capitalist sentiment (e.g., 50% of students rejecting capitalism per a Harvard study) to student debt and job market insecurity.
• Proposed solution: Create high-paying jobs to provide a viable pipeline for graduates, countering rhetoric against banks and Wall Street.

Federalism and Governance Structure:

• Delegation: Strong consensus that states should manage workforce development, transportation, and environmental policy via block grants rather than federal agency directives.
• Efficiency: Governors argue state/local administration is more efficient, accountable, and effective for services like education and infrastructure than Washington D.C.