Governor’s State-of-the-State Speech

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Governor Jan Brewer will be giving her State-of-the-State speech to kick off the legislative session. See the entire speech plus get expert analysis from political consultant Stan Barnes and ex-lawmaker David Schapira.

Ted Simons: Coming up next on "Arizona Horizon," the Governor gives what is likely to be her last State of the State address. We will hear the speech in its entirety and then follow up with analysis on what the Governor had to say. The State of the State, next on "Arizona Horizon."

Narrator: "Arizona Horizon" is made possible by contributions from the Friends of Eight, members of your Arizona PBS station. Thank you.

Ted Simons: Good evening, welcome to "Arizona Horizon," I'm Ted Simons. Governor Jan Brewer today outlined her agenda for the upcoming legislative session in the Governor's annual State of the State address. We'll have response and analysis to the speech. First, here is the Governor's State of the State address. [Applause]

Gov. Brewer: Thank you, thank you all very much. [Applause] Thank you all. I know it's been a long morning. Speaker Tobin, President Biggs, Honorable Senators, and Representatives of the Arizona Legislature, Chief Justice Berch and the Supreme Justices of the Court, and constitutional officers, tribal leaders, honored guests, and my fellow Arizonans It's my pleasure to welcome back Representative Doris Goodale, you've gone through a long struggle. [Applause]

You've gone through a long struggle, Doris, and we're glad to see you here today ready to help build a better Arizona. [Applause]

And while I'm pleased by Doris' recovery, I was terribly saddened to lose Ben Miranda. Catherine, the state of Arizona extends our deepest sympathies for your loss and the loss of a great public servant, your husband and my friend Ben. His voice will be missed, but let us pray that his spirit of public service lives on in all of us. [Applause] When I stood here for the first time as governor, we faced the daunting task of navigating the state I love out of the bleakest recession in our history, and back to the path of prosperity and opportunity. I recognized that overcoming this challenge would be difficult and painful. It would require honest leadership and tough decision-making. And then of course there are challenges we could never predict, challenges that test our resolve. This past year Arizona experienced one of the worst tragedies in our history as we lost 19 heroic firefighters at Yarnell Hill. That June day will forever be etched into our hearts. The brave 19 and their families are forever in our prayers. Please stand and join me in a moment of silence to honor these fallen fighters. [Moment of silence] Thank you. Today I am proud of the progress we've made in the past five years, to bring about the Arizona comeback. We steered Arizona out of a debilitating recession and implemented historic reforms and long-term structural improvements that secure Arizona's prosperity for generations to come. It's been a challenge, one I could not have fully managed without the constant support and guidance from my family. I am so very grateful to them for always being there for me. Thanks to my husband John, my son Michael who once again join me in this chamber. [Applause] I also appreciate the support from the people of Arizona, lawmakers, the business community and countless others. Together we have worked hard to guide Arizona out of a historic recession we inherited. As my hero, Ronald Reagan, said during his 1967 inaugural as governor of California -- and I quote -- we will put our fiscal house in order. And as we do, we will build those things we need to make our state a better place in which to live. And we will enjoy them more, knowing we can afford them and they are paid for - end of quote. I'm proud to report to you today that Arizona's fiscal house is in order. And together, let's keep it that way. [Applause] We've come a long way in a short time. In 2009, Arizona's budget was irresponsibly drained after years of unsustainable spending. We had the worst budget deficit of any state. Today we have reined in government spending by consolidating, eliminating, and transforming our operations. In 2009, Arizona had a $3 billion deficit. Today Arizona boasts a healthy state surplus and a replenished rainy day fund. Most impressively we ended this past fiscal year with nearly $900 million in the bank. [Applause] There is no doubt Arizona is back on track. [Applause] We also remember our state was swept up in some of the worse unemployment in our history. Arizona's businesses and families struggled to stay afloat. Today we've turned things around. With help from the Arizona Commerce Authority, our historic tax reforms, our employers have created nearly 175,000 new jobs with an impressive $4.3 billion in new capital investment. In 2009, Arizona was ranked among the worst states in an antiquated business stifling tax policy. Today we're among the best for attracting and helping our business grow and thrive. We lowered business property and equipment taxes. We lowered corporate income taxes and we lowered capital gains taxes. [Applause] We even simplified sales taxes from a confusing multi-city, multi-layered process to a single collection and audit. Don't let anyone fool you. The tax and regulatory environment in our state matters. Businesses across the nation and the world are watching. Our message to job creators has been heard. Arizona is open for business. [Applause] We now have more jobs, more businesses and more opportunity for growth and prosperity. And I'm in good company believing that. Arizona is ranked in the top 10 by CEOs nationwide. And Forbes Magazine recognized us as the number one state for expected job growth. [Applause] It's no surprise we have attracted and expanded major companies like Apple, G.M., Intel, State Farm and many, many more. And I'm confident more are on the way. [Applause] Our focus on jobs creation continues to pay off. That's because we listened to what businesses need, and what attracts more of them to Arizona. We addressed the issues around uncompensated care and the hidden health care tax. By again, listening to the business community and honoring the will of the people. When the federal government shut down, we worked hard to reopen the Grand Canyon during a crucial time for our tourism industry. In doing so we recovered more than $1 million in revenue per day, benefiting our communities, businesses and the economy. We stood united in saying to Washington, do your job. Keep the Grand Canyon open. [Applause] Government should never close down what God has created. [Applause] Arizona's ability to deal with our own issues stands in sharp contrast to the federal government's inability to deal with their core responsibilities. Like securing the border, fixing immigration and righting our national fiscal ship. On behalf of the people of Arizona, I say to the President and Congress, quit fighting and get to working for the American people. [Applause] Unfortunately, we can't fix Washington from here. But we can and will continue to show the nation how it's done. Our hard work makes it all the more rewarding to stand here today and confidently proclaim that the spirit of Arizona is strong, and so is the state of our state. [Applause] Some pundits and nay-Sayers may try to brush aside such groundbreaking changes, we continue to lead with practical and principled initiatives that drive Arizona forward. We must continue to work on our tax structure and education system and government, all of which are essential to a thriving economy. Certainly improving Arizona's business climate has been a hallmark of these past five years. With everything we've accomplished on behalf of Arizona's businesses, I am equally proud of the work we have done on behalf of Arizona's families. From school choice policies that give parents the power to decide their children's education, to life-affirming legislation protecting the unborn. [Applause] Together we have pursued and protected the values most important to Arizona's families he and Arizona's future. The historic initiatives we have enacted these past few years have been transformational. We are not done and we will remain unrelenting. Let's continue to face our challenges head on. Now is not the time to rest on our accomplishments. Our immediate challenge is to transform our child protection system to ensure the safety and well-being of Arizona's abused and neglected children. I know this. All of us care. And Arizona must do better. [Applause] We created the Office of Child Welfare Investigations as an incremental first step. Thanks to OCWI, we discovered the horrifying truth that some at CPS failed to investigate or even respond to thousands of reports of child abuse. This is unconscionable. I have created the independent C.A.R.E. team to oversee the investigation of these cases and to identify areas of concern within CPS. I also ordered the Department of Public Safety to conduct an administrative review to determine why these cases were not investigated. I want to report that the C.A.R.E. team is making tremendous strides. To date, nearly all of the cases have been assigned and more than 3,000 children have been seen by CPS staff or local law enforcement. I also want to express my appreciation to Charles Flanagan, the entire C.A.R.E. team, and the CPS staff working with them for their dedicated efforts getting eyes on these children. [Applause] But our job is far from over. It is evident that our child welfare system is broken, impeded by years of structural and operational failures. It breaks my heart and makes me angry. Enough with uninvestigated reports of abuse and neglect. Enough with the lack of transparency, and enough with the excuses. [Applause] This morning I signed an executive order that abolishes CPS as we know it -- [Applause] -- and establishes a new Division of Child Safety and Family Services with its own cabinet level director who reports to me. And I have asked Charles Flanagan to serve as that director. [Applause] However, we need to go even further. The time has come to statutorily establish a separate agency that focuses exclusively on the safety and well-being of children, and helping families in distress without jeopardizing child safety. I call on the Legislature to work with me to codify a new permanent agency. Child safety must be the priority and become embedded in the fabric of this new agency, that is our -- thank you, yes. [Applause] It is our legal and moral duty. Another challenge that has confronted us far too long, and has been a cornerstone of my career, is behavioral health. For more than three decades Arizona has been forced to live under court direction because we've failed our seriously mentally ill population. As governor, I insisted that we properly fund and fundamentally reform behavioral health into a holistic community-based system. I am pleased that over the past two years with good faith negotiations in the Arnold V. Sarn litigation, this goal was accomplished. This win-win solution allows the seriously mentally ill to participate in society in a more meaningful way, and to southwest service and care they require and deserve. We also introduced metrics to evaluate the system he and hold it accountable. As a result of these historic reforms I was proud to announce last week an agreement, subject to final court approval, that will end the Arnold V. Sarn litigation. After reaffirming Arizona's commitment to a community-based behavioral health care system. Now, let me be clear. This watershed agreement ends more than 30 years of litigation, and it is structured so that if future government fails to live up to the terms, plaintiffs will be able to reopen the case. This should never happen. Arizona's system is working. And it is now a national model. [Applause] This agreement is the result of the hard work and dedication of many devoted people. Let me recognize one instrumental leader who showed unmatched passion and commitment to improving the lives of people with mental illness. Charles Arnold was the originally lead plaintiff in the lawsuit that bears his name, and he is with us today. Charles, would you please stand so we can thank you for your perseverance on behalf of those who often cannot speak for themselves? Thank you. [Applause] We are also working to create a model for states dealing with another difficult challenge. Human trafficking traumatizes 27 million victims worldwide and targets women and children, turning many into sex slaves. It may shock you to know it happens right here in Arizona. Let me tell you a story about one inspiring woman who triumphed over this modern day slavery. At age 16, Savannah Sanders was forced into the commercial sex industry and battled childhood rape, homelessness, and drug addiction. Thankfully, she is a survivor and hopeful example, a loving wife and a proud mother pursuing her masters in social work at ASU. She advocates for victims, traveling the country to promote awareness and prevention and providing comfort and healing for fellow survivors. Savannah shows us that there is hope, and that we can stop this abuse, and that we are stronger than this evil. This amazing woman is with us today. I'm proud of you, Savannah. Please stand and accept our gratitude for your inspirational human spirit. [Applause] Last year, I established a human trafficking task force to address this problem. Co-chaired by Cindy McCain and Gil Orrantia, the task force recommended ways to better protect victims, to increase penalties for perpetrators and to end these horrible crimes. Today, I ask you to strengthen Arizona's law to give prosecutors and law enforcement more tools to combat this evil and help better protect victims. We also will launch an awareness campaign so Arizonans will know what to look for and how to report it. And victims will know how to seek help. Further, I will create a human trafficking council to coordinate efforts statewide to address this crime. To all the victims of human trafficking out there -- we have not forgotten you. Don't give up. Help is on the way. To the criminal traffickers, I say -- your days are numbered. [Applause] I firmly believe in this great state of Arizona and our ability to address our challenges, and to be successful in pursuing tomorrow's potential. What we are doing today will set the tone for Arizona's economy and job creation for years. Our future quality of life depends on today's decisions. This year I am calling on the Legislature to approve a package to further boost Arizona's business competitiveness, particularly in technology and manufacturing sectors, which brings high-paying jobs. Arizona, for example, is one of the few states that impose a sales tax on manufacturers for the power used to create their products. That puts our current manufacturers and the ones we hope to recruit, at a disadvantage. I'm asking you to send me legislation to eliminate this tax and increase Arizona's competitive edge. [Applause] We recognize that manufacturing is more than just an industry, it's a mighty engine of healthy job creation. Arizona can be even more competitive. Let me give you an example. Recently I toured the Celgene plant in West Phoenix, which makes a drug that treats several forms of cancer. This breakthrough life-saving drug is produced only in Arizona, and it was developed in Arizona thanks to a partnership with TGen, Scottsdale Health Care and others. It is this type of innovative, research-driven and idea to market manufacturing system that ultimately produces good jobs and healthy economy. To that end, it is imperative to have a stable, dedicated funding source for TGen, to continue its valuable role as a catalyst in developing Arizona's bioscience industry. Let's help Arizona develop more pipelines of innovation, connecting quality research, a stellar workforce and competitive manufacturing from beginning to end. For Arizona to remain competitive on all fronts, we also cannot ignore transportation, water and other infrastructure demands. These are all paramount to creating jobs, attracting capital investment, and assuring a sustainable future. Together we must be honest and have an open dialogue about workable solutions to address these critical needs. Of course, none of our progress towards economic prosperity will ultimately work if we do not improve our K-12 schools. [Applause] By 2018, three out of five jobs in Arizona will require post-secondary training. Our students must be better prepared for the challenging and competitive world they will soon enter. That means we stop funding the status quo. And instead, reward innovation and measured outcomes and fund the results we want. [Applause] I am asking legislators to approve an ambitious and historic education proposal, which I call student success funding. Under this plan we will reward improved student performance he and we will incentivize and replicate success. Also, reforms are needed in higher education. For example, Arizona families working hard to save enough for their kids to seek a University degree are flat-out tired of unpredictable tuition hikes. Arizona students and families need stability and affordability in their college education. To ensure these twin goals are met, I am asking our Arizona Board of Regents to develop a plan and adopt a policy that guarantees stable in-state tuition levels for the four years it should take a student to graduate. [Applause] Together, we should be able to make this happen. Students expect it. And Arizona's tax-paying parents deserve it. [Applause] Few things have a greater positive economic impact in Arizona's communities than our military bases. Together they contribute more than $9 billion to our economy annually, while safeguarding our great country. We are more prepared to help the military accomplish its diverse missions than nearly any other state. I remain committed to protecting and enhancing Arizona's military bases. That is why I will direct the military affairs commission to develop a strategic plan for sustaining their mission. We must be ready to protect Arizona's military installations if the federal government moves to close or realign more bases. [Applause] This year I am calling on the Legislature to renew support for the military installation fund that. Money will be used specifically to mitigate property encroachment and reserve military land use projects without throwing that financial burden on private property owners. Protecting our military is good for Arizona, and good for America. I've been returning to the Capitol now for more than 30 years, uniting with my fellow public servants in pursuit of a shared mission, to stand up for the people we are entrusted to serve. To keep our honor clean and to leave this place better and freer than we found it. For little more than a century representatives of the people have come to this capitol to lift it toward its prosperous destiny, to bring great fruit from this beautiful desert land, to hold our citizens safe from harm, and to provide children the knowledge, industry and character that will make and keep them free. Great men and great women have walked these chambers and graced these lands with their honorable public service. We should aspire here to rank among the best of those. For this state was built by others before us, and eventually will be left to others who will follow. It is ours to love only for a time. May we love it wisely, and lead it well. Ten years from now -- whether I run again or not -- I will be working in my garden and I will look back with pride. And if I can borrow a sentiment from Ronald Reagan, I will be uplifted knowing we weren't just marking time. We made a difference. We made this great state stronger; we made it freer; and we left her in good hands. May God bless us in that work, and may God forever bless and protect the great State of Arizona and the United States of America. Thank you. [Applause]

Ted Simons: After the Governor gives the State of the State address it is customary for the opposing party to offer a response. Here what's Democratic leaders had to say about the Governor's speech.

Anna Tovar: We must keep moving forward to protect our most vulnerable citizens, which are our children. CPS is in turmoil and its failers must be corrected without excuses and without delay. We cannot let another child fall through the cracks. The Governor today suggested a step forward from this solution. We look forward to learning more about the idea, and working with her to ensure proper resources, transparency, accountability and leadership as part of any plan.

Chad Campbell: I think there's still some questions, though, about the great comeback, as the governor calls it. I think if you look at the data that's simply not true. Are we recovering? Yes. We have kind of stopped the bleeding. Have we recovered from the injury? I don't think so. We're nowhere near where we were in prerecession levels. I'm not convinced we're in such a solid position that Governor Brewer wants to project. Are we better off in many ways than five years ago? Yes. But I don't think we're in the best position possible. It's easy to claim a balanced budget and a $900 million surplus when you haven't funded education. If you have a bank account with $10,000 in it, as your roof is leaking and your children have no clothes, should you be proud of the bank account? No, you shouldn't be. Your life is literally falling around you. We have state agencies across the board, as you know, that are failing and leading to potentially life-threatening situations that in some situations probably have cost lives. We have a long ways to go. Our unemployment rate is still very high, especially in rural Arizona. Go ask somebody in Yuma how they feel about the great Arizona comeback, in terms of jobs. I bet they have a very different answer than the people in Phoenix. Is it a good State of the State? There were some good things in it. We have a long way to go, and we need to have serious conversations about actually doing the right thing for the State. Putting money where it needs to be, investing in the proper things to get Arizona back on track and moving forward. Not to stop the bleeding, but actually moving forward now.

Ted Simons: Joining us for analysis on the Governor's State of the State address, political consultant Stan Barnes of Copper State Consulting, and David Schapira, assistant superintendent of the East Valley Institute of Technology. Let's start with the governor -- starting shallow and going deep. The Governor seemed confident up there, a little bit of a swagger at times, what did you think?

Stan Barnes: I share the same opinion you have. This is her fifth speech up there. She knows who she is, she's confident. She's been the Governor through the toughest times I've seen in my lifetime as a native Arizonan. We're up and on a plane and we're going. She knows why she's in that chamber and she's very comfortable. If it was her last, it was well done.

Ted Simons: If indeed it was her last State of the State address, did she wrap it up in a last tidy bow? Or was the wink and nod saying something?

David Schapira: I think that was her goal. I saw her run the reelection thing as a tongue in cheek moment and gave it a little smirk. I think her goal was in what I think was a well-written speech, she had her same verbal hiccups as always, she did try to tie it all together and wrap it up. But a lot of times the rhetoric didn't exactly match what we've seen for the last five years. As always, hopefully we can meet some of those goals.

Stan Barnes: I think it's important for viewers to note it feels very partisan sometimes, no matter what party the Governor is. Today it felt a lot less partisan. A lot of the applause lines were both sides of the aisle applauding. I was in the gallery watching and it didn't feel like a big division down there on the floor of the house where the speech was made. There is a big distance between the Governor and the legislature and distance between the House and Senate, a distance between members. It's going to be a very tough session.

David Schapira: Interestingly, I think it was more divided. Let me explain. Normally there's just one division between the Ds and Rs down there. Right now there are so many divisions. Four caucuses in the Senate, maybe five. Three or four caucuses in the House. Because it is so divided people don't really know who's on their side. I think it was more like the British parliament today, where you kind of had a few consensus groups clapping on this and a few others clapping on that.

Ted Simons: A little more than British parliament would be great. I want to get into that relationship aspect in a second here. You were there was there a gasp? Could you hear a pin drop when all of a sudden CPS as of this morning was abolished?

Stan Barnes: Yes. The whole room said, there, that's the headline. That's the news, that's what we've been waiting for. I think the Governor understood she had to do something bold on that issue and she did. The way it was written, the way she said it, by executive order we have abolished -- it felt like, boom, and it had the impact she wanted. There was an immediate now. Then she backfilled some of that. The legislature will have to act on it and it's still, yet, going to be an issue with some difficulties, just because.

Ted Simons: This was something I think was a legitimate surprise to a lot of folks, maybe up to and including Charles Flanagan, who's going to head this up new cabinet level position, I suppose that reports directly to the governor.

David Schapira: It was like last year, the last minute insert, we got advanced copies and they inserted Medicaid expansion, and that's what they did with this. It was really unknown up until this moment. I was behind the scenes watching with staff members of the Capitol. Certainly everybody was surprised. There was a verbal gasp there, because we were behind the scenes and we could do it. It is kind of the what now, and certainly the devil is in the details. The thing I found most interesting, and what was less surprising about it to me, and I think part of the reason it was done so last-minute, is this is actually something a few out there have been calling for just over the last week. Fred Duval, the Democratic candidate for governor in this upcoming election, three days ago did an extensive blog post exactly about this issue, about making CPS a cabinet level agency. He went into pretty good detail as to what that looks line. I thought the details were missing, and she could have added in a little more context. Three or four sentences could have covered the kind of things Fred talked about in his blog. This was the same thing Fred called for three days ago.

Ted Simons: Are we seeing a cabinet position that deals only with child services, family services? I thought there was supposed to be another stand-alone child services?

Stan Barnes: It's unwritten, it's unifying as an issue for both sides. It's in all leadership interest to do something about CPS, and there will be a lot of unity around it. There will be brass knuckles fighting behind the scenes as to what it should look like. Arizonans will see clearly that the issue has been grabbed and dealt with. The Governor was very clear about it. No more, we're not going to do this anymore.

Ted Simons: Can we afford to grab and deal with this?

David Schapira: There's constitutional questions about how to grab and deal with it. Does the governor really have the authority to take an agency that's already appropriated through DES, we're in the middle of a fiscal year. Can she unilaterally make it its own agency? I think she's acknowledged she can't do it where she says, I need the Legislature to step up and give me legislative authority and create an agency. It's going to go right into the sausage-making process because the Legislature has to have its say.

Ted Simons: Has anyone seen DES director Clarence Carter lately?

Stan Barnes: No, they haven't. I think he's probably got his head down and waiting for this to come out of his hands. He's still going to remain the head of the department of economic security where CPS has been housed. He's going to be continuing on in that respect. It's the end of the governor's term. He has been a loyalist and up and to this point has done a pretty good job, everybody believes. I think he may survive it because they are moving it.

Ted Simons: Education not mentioned until quite late in the speech. A little bit of a surprise?

David Schapira: For me, education being the most important thing, I'm looking for the Governor to lay out an agenda for this coming year. It was late, six sentence about K-12 education and a little bit about higher education. Kind of something we've heard for a while. We've heard for a while she wanted to do something with performance pay. I'm happy to hear she's moved off the whole school letter grade or grouping entire classes together, and instead moving to individual student performance. I heard behind the scenes it's going to be based on student growth. If you were going to use a metric for performance pay, I think we'd rather see something like individual student growth. There again, the devil will be in the details because the Legislature had as to hash that out, as well.

Stan Barnes: Education came late in the speech I wouldn't read too much into that. As a legacy speech for a governor who took over some difficult times, she touched on some important things to her we should take note of. This idea of getting the behavioral health and the CPS matter, this is a Republican governor with a big heart who wants to do right by the more vulnerable citizens. It's been her hallmark since she served in the legislature. The big part of her speech was a lot on that, including the human trafficking issue, which surprised me. There it was in the speech, and it follows the same line. She wants to do something for people that are vulnerable and that's going to be a legacy issue for her.

Ted Simons: But education is such a big issue and always mentioned, always referred to. At the Chamber of Commerce luncheon it was a major issue, and she talked about it more there than she did during the speech here. The more growth a student shows, the more money a district gets, hasn't that idea been thrown around before?

Stan Barnes: I think every single idea has been thrown around before. Twenty-five years ago I was sworn in and education was the number one issue, it'll always be the number one issue. Trying something different because times change, politics change, constituencies ebb and flow, and people are ready for something different. She wants to offer it.

Ted Simons: Could this be the big surprise when she offers her budget later?

Stan Barnes: I think that's true. The budget is where the rubber meets the road, where the real priorities are laid out.

Ted Simons: Secondary and postsecondary education, let's make the tuition stable so we don't have these tuition hikes which she mentioned, that parents are frustrated with. I know the Board of Regents has big ideas as far as university funding is concerned. Didn't hear much of a response today.

David Schapira: First, I like the fact she used the word in her speech, post-secondary in her speech instead of college or University. Post-secondary means something different today in this economy and in terms of the innovations that we need. I'm glad she talked about it a little more generally. But she didn't get to the point specifically, our three major universities. What's interesting about that was she's taken the role of the Board of Regents, an entity appointed by governors, and kind of saying we should take some responsibility out of their hands and say, we're going to have a more constant predictable tuition for our students who are coming in. I like that idea. I want our students to know what it is they are going to be paying, not just their freshman year but their senior year. The universities have two major funding sources student tuition and state-level contribution. Giving the unpredictability on television, the Board of Regents has no say on what the state gives, that'll cause funding problems down the road. I think she needs to tell the legislature to be more predictable.

Ted Simons: Is this just an idea for the board of education to look at to plan?

Stan Barnes: Those are important people doing important work, and they don't always see eye to eye. But I think it was a message to the Board of Regents. Her former chief of staff is a very respected person, Eileen Kline who now high side up the Board of Regents, she was sitting in the room and I'm sure the message was received. There's going to be a lot in the details.

Ted Simons: And no mention of financial aid, either. We'll see what happens as far as the budget is concerned. Were you surprised she called for a stable funding source for TGen?

Stan Barnes: I was pleasantly surprised. And I like how she wrapped it, the drug analogy, the drug created in Arizona and the lives it's saving. That's something we've wanted for some time but haven't found the political will to get up and do. I was pleasantly surprised she decided to touch it. She legitimized the issue by showing the good things coming out of it.

Ted Simons: She touched it, but will the legislature grab it?

David Schapira: You have different factions even among the majority at the Legislature in terms of the picking winners and losers. Where a lot of them will come down on the same page I think is job creation. Is it actually going to create jobs? That to me is the biggest question on the minds of many legislators. She talks about job growth in the last year. The only way that continues is if we continue to provide incentives, not just to industries we like or want Arizona to have, but industries that are going to create jobs in the state. Those industries are keeping a keen eye on education to see if we are going to have a stable work force going forward.

Ted Simons: Seems like the business community is saying, we've gotten a lot of tax breaks and help attracting and retaining. We've got do something about education.

Stan Barnes: I think that's fair enough, it's a unifying force and there's a shift in that issue. Some of the natural dynamics are changing. From the various factions David is talking about, I saw a lot of applauding on the floor. It's surprising to ever see a lot of people applauding in Arizona on both sides.

David Schapira: The tech business community has been here for a few years. When I started as minority leader in 2010 or 2011, the business community approached all four caucuses and said, the top of our legislative agenda is education. They have been there, and I think the Legislature unfortunately has not answered the call as much as they should.

Ted Simons: Let's talk about again, wrapping up the Governor's term, if this is her final hurrah here. No doubt Arizona is back on track, quote. Arizona's fiscal house is in order and we're referring to Washington's fiscal problems. We can't fix Washington, but we can show them how it's done. A lot of what happened in Arizona was at least helped by that one cent sales tax. It helped a lot. That's gone. Tax relief is coming soon, as far as revenue is concerned, some are concerned. Are we whistling past the graveyard?

Stan Barnes: If anyone feels like they are, they have lost perspective of how truly bad things were when she took over. The Legislature had a $3 billion one-year difficulty. Yet did not want to cut the government down that much, because it wouldn't be a healthy thing for the economy. So sold the state capitol building, and raised taxes by a billion or at least the voters did once it was approved on the ballot. She's got a lot to brag about. The majority party that made that happen has an awful lot to brag about. Will governance ever be smooth? Are we going to have permanent funding that makes everything rainbows and unicorns? Of course not. But in comparison to where we were when she took over, things are great and they are not great at the federal level.

Ted Simons: The Arizona comeback, Democratic leadership, talk to people in Yuma, that's not a comeback. The fact is the state is better off than it was.

David Schapira: And we're getting there. I think unfortunately I don't know that you can have it both ways. In one breath, you know, she talks about how great Arizona is doing, and in another breath criticizes the federal government. If you look at the trends in Arizona, certainly it's been more pronounced here, the volatility of the recession we just went through. Nationally you saw a recession and you're seeing great improvements. Look at the stock market just last week. There's been some positivity nationally in the economy, and that certainly has helped the state. But then she picks the straw man bad guy of the federal government, and says the federal government should act more like Arizona. If you look at our legislature and how divided and divisive it is, politics in this state unfortunately has hurt our economy in recent years than helped it.

Ted Simons: Is that valid?

Stan Barnes: Kind of. She misses the central point that she's trying to make. The federal government fiscally speaking, the government -- not the national economy, but the federal government is totally hopelessly out of control he and lost and borrowing a trillion dollars a year just to make ends meet. If Arizona behaved in a similar manner, we would all be in a different spot. I think her message to the federal government to be fiscally prudent is a valid message and one she stand behind, because Arizona was fiscally prudent, the federal government is not.

Ted Simons: Regardless of how you got there, you got there.

Stan Barnes: Exactly. A lot of criticism by the Democrats. I thought Chad Campbell was really tough on the Governor, unrighteously so. I don't think he should have been that tough on her. It was a force majeur that hit all of us, and she got us there.

David Schapira: There's a lot of frustration in the legislature. I'm a year out at this point but I remember some pretty tough days with the politics that go on down there. Some is that level of frustration. But another part is, especially in Democratic districts, we hear they are not seeing the kind of improvement they want to assessment some of the richer areas of the state are seeing great improvement. Places like Chad Campbell mentioned, like Yuma and South Phoenix, a lot of places are lagging behind in that economic improvement. We want to lift all boats, to make sure everybody has a chance to be prosperous in this economy.

Ted Simons: The Governor's relationship with the Legislature, the relationship with leadership, there's always a gap there. How big that is gap?

Stan Barnes: It's a natural tension and it's set up in the constitution to be that way. however, now it's bigger than the Grand Canyon and that's too bad. We've got to have personalities getting along together. There has to be a level of trust to get bills done and signed and that sort of thing. The fracture in the last session, which now feels so long ago, is still fresh in the minds of so many legislators. You need a Venn diagram to do it but the distance is large, it's big.

Ted Simons: Did it narrow at all in the last few months?

Stan Barnes: I don't believe it did. It's my assessment as an outsider looking in. I think it's hardened. There is scar tissue there, there are the campaigns to come and there is the realization they have got do a budget again and no one today -- perhaps the Governor herself who really holds the cards, know, if we're going do a Republican budget again. That may decide how long the session goes.

Ted Simons: And asking about the governor's relationship with the Legislature, what is legislative leadership's relationship with their caucuses? We had all sorts of drama going on there.

David Schapira: It now extends well beyond the branches of government. It's gone down to the individual rank and file level. Over the last few years, especially in my last term when you had super majorities in the Republican Party in both chambers, there were a lot of divisions in the party many we caught that infection --

Stan Barnes: When you say we --

David Schapira: The Democrats. There's been division among Democrats, a little bit. I think Democrats will join in solidarity this session and I think we'll come together with the governor and Republicans to do a coalition budget. I think that's the only way it's going to happen.

Ted Simons: What about the Republican caucus?

Stan Barnes: Well, it's a multitude of warring factions and tribes and very hard to diagnose. But it is believed by capitol watchers, including myself, the price of poker is higher this year. In other words, when the coalition was done last year, Democrats got the pleasure, first time in a long time, of splitting the Republicans. Their price was let's do the Medicaid expansion deal. And now that price has got to be higher. If you're a Democratic leadership, you're not going to throw in with the Republican governor on a budget. You're going to demand some Democratic oriented reforms and laws and money. Will that hold, will Jan Brewer going along with that or will she go along with Andy Biggs and Tobin with that.

Ted Simons: And will that hold or will the republicans hold?

David Schapira: I think a lot of priorities she outlined in the State of the State, frankly I think true just about every year she's given the State of the State, I think it's in line with the Democratic values I think Democrats in the legislature are going for. I think they will be open to negotiations and hopefully they will be invited to the table.

Ted Simons: It's an election year, are we going to see shenanigans this election year?

Stan Barnes: Of course we are, and I resent the judgmental tone. [laughter]

Stan Barnes: This is politics, self-government. While I don't defend every jot and tittle of it, it's just the nature of human beings in election years to game each other and set up a better outcome for themselves.

Ted Simons: And we'll look up "jot and tittle" after the program. Thanks for joining us. Tomorrow on "Arizona Horizon," Andy Biggs and House Speaker Tobin join to us offer their agenda for the legislative session. That is it for now, I'm Ted Simons. Thank you so much for joining us, you have a great evening.

Captioning Performed By LNS Captioning

Stan Barnes:Political Consultant;David Schapira:Ex-Lawmaker

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