Vote 2014: Gubernatorial Debate

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For the first time since 1997, Arizona is poised to have a male governor. Hear from the four men who want to lead our state. Republican Doug Ducey, Democrat Fred DuVal, Libertarian Barry Hess and Americans Elect representative John Mealer will debate the issues important to our state.

Ted Simons: Good evening and welcome to this special "Vote 2014" edition of "Arizona Horizon." I'm Ted Simons. Tonight's show is a debate sponsored by Clean Elections. We'll hear from candidates looking to lead our state as the next governor. As with all of "Arizona Horizon's" debates this is not a formal exercise. It's an open exchange of ideas, an opportunity for give and take between candidates for the state's top office. As such, interjections and even interruptions are allowed, provided that all sides get a fair shake. We'll do our best to see that that happens. Four candidates are competing to be Arizona's chief executive. They are, alphabetical order: Republican state treasurer and businessman Doug Ducey. Fred DuVal, who has served on the Board of Regents and in the Clinton administration. Libertarian Barry Hess, a businessman and Americans Elect candidate, John Mealer, also a businessman. Each candidate will have one minute for opening and closing statements. Earlier we drew numbers to see who goes first, and that honor goes to Fred DuVal.

Fred DuVal: Thank you, good evening. I love Arizona, I grew up here, my family, Jennifer and I are raising our children here and we love this place. I'm running for governor because we're worried that Arizona is headed in the wrong direction. Our children are losing out. The deep cuts in education have been too severe and we're losing jobs and opportunity. Let me make a clear promise, a clear statement: I will stop the cuts to public education. Full stop. I will use the veto if necessary but no more cuts. Not another dollar, not another penny. Now, the voters have a choice. The Supreme Court has recently made a decision that the voters have made, a decision to invest in our children's schools. I believe we should enforce this decision immediately and reinvest in our children's schools. Doug and others disagree with this. I think the most important thing we do is to invest in or children's schools and opportunities for the future.

Ted Simons: Next opening statement, we return to John Mealer.

John Mealer: Hello, I'm John Mealer, I am an independent Constitutionalist. Here's my opportunity. I agree with Fred here about education being in need of heavy repair. The only thing is that I detail a way to pay for this. Budget cuts are one way, but I don't believe in that. We need to increase revenue. I have the industrial connections to do so. I truly believe that Arizona needs to run Arizona. No longer special interests groups out of D.C., which unfortunately happens to be with both parties. I'm the independent and I would like to serve you as governor.

Ted Simons: Thank you very much. Next we turn to Doug Ducey.

Doug Ducey: Thank you, Ted. My name is Doug Ducey and I want to be your next governor. My wife Angela and I have been married 24 years this October, we have three sons, Jack, Joe and Sam. I'm running on my real world experience as small business owner of Cold Stone Creamery, a chief executive officer and your treasurer, managing over $12.5 billion of Arizona state tax assets. I have a very clear agenda. I want to kick-start the economy so there are more jobs for hardworking Arizonans that turn into fulfilling careers. I want to restore our education system to a level of excellence; we expect to serve teachers and parents. I want to be an independent voice for the State of Arizona and I'm proud to announce tonight that I've been endorsed by Democratic state legislator Katherine Miranda. I think you can tell a lot about how someone will govern by how they campaign. I've reached out to Katherine, she's joined our campaign. I'm running for governor of all the people.

Ted Simons: All right, thank you very much. Final opening statement we turn to Barry Hess.

Barry Hess: Hi, I'm Barry Hess. As you can already tell, I can tell you, I'm no Nostradamus but I can say what's going to happen. The Democrat will tell you he knows how to spend your money, raise and educate your children and control your personal life better than you can. The Republican is going to be a little different, he's going tell you he knows how to spend your money, raise and educate your children and run your life better than the Democrat. I'm a Libertarian and I believe these are only things that you can do. I do not agree that we have to continue funding an excessively bloated education program. We're not getting our money's worth and more money is not the answer. Otherwise, Washington, D.C., who spends twice as much money as we do, wouldn't be elbowing Arizona out of last place in the state. You're going to see a whole lot of differences between us but mine's going to be focused on the rights of the individual, that's why I want to be your governor.

Ted Simons: Fred, how are you going to balance the budget with these inflation adjusted education funds, provided the courts say you got to pay for them. How are you going to pay for them?

Fred DuVal: First let's be clear, the Supreme Court has ruled that we need to pay back this money. The first place to start is the rainy day fund. It's been built on the back of cuts from our schools. We need to use the rainy day fund to begin the process of a multiyear commitment. Then we need to go through a variety of other steps to make sure we can make state government more efficient. I think procurement reform offers many possibilities, state trust land offers possibilities. But we must establish our priorities. My absolute priority is no more cuts. We have cut education severely in Arizona. We see the largest class sizes and record levels of teacher flight from our state, and these are all a result of this sustained cutting of education and balancing the budget on the backs of education has to stop.

Ted Simons: How do we pay for it, 300-some-odd dollars every year, not including the back payments.

Doug Ducey: First we need to make sure we're spending the money in the proper places. I want to see the dollars go to teachers in the classrooms, funding what works. I want us to focus on literacy that can make the biggest difference in the state of Arizona. The state has $1.7 billion in taxes and $454 in a reserve account earning interest. I'm going to balance the budget one fiscal year at a time. Let's make sure we're properly spending dollars so we're best spending for children, teachers and parents of Arizona.

Ted Simons: But that money is going to have to be accounted for somehow. How are you going to balance the budget?

Doug Ducey: We look at everything that's going on in the budget. I've talked to about 80 different state agencies. I'm a businessperson. I want to go through line by line and dollar by dollar. We also have 27% of the state's workforce outside education that's eligible for retirement in the next four years. You don't have to let one person go. But through disciplined hiring and the use of technology, you can find savings and efficiencies.

Ted Simons: Already, John, we're not talking about $1.6 billion in back payments. How are you going to balance the budget?

John Mealer: I believe with the industry kick I can bring the state, it's all detailed in a booklet I have on my website. I detail how we can take the state's trust lands and break it down to taxable property with some 69 industries that want to move into the state. These industries have been knocking on our door for at least 25 years; I've been involved in trying to bring them into the state. We need to bring them in and allow that taxable property to be taxed and use that for the schools.

Ted Simons: What do you think, Barry?

Barry Hess: If we have a surplus as Doug says, pay it off now. Doesn't that make sense? But actually my plan calls for using the rainy day fund and reclaiming some of the lands the Feds have taken from us, and selling it for the purpose of education like it's supposed to be. But most importantly, what I'll be striving for is asking the voters to repeal the mandatory spending. It's not about money. We've already seen that. We've got to cut the spending because the education budget now absorbs almost 50% of our budget. It's ridiculous. I'd like to see it at about 20%.

Fred DuVal: Could I go back to this? I want to talk about the two ideas Doug has put on the table. The first is the notion that we can capture hundreds of millions in reorganization of state government. It was the effort to do just that, creating DES. We lost child protective services in the process. Sometimes cuts require accountability. Secondly, the notion that we're not going to fill state positions as they become open is a foolish risk. Are we not going to replace DPS officers on the board? Are we not going to replace DPS services? Are we not going to create corrections officers when they retire?

Doug Ducey: The notion that we wouldn't put children or public safety first is just a distortion of what I'm talking about. 80 separate agencies representing over a billion dollars in annual spending. Anybody that doesn't think government can't tighten its belt a bit, and we can't do better than some of these bloated bureaucracies, I think we need to review everything we're doing and look at the core functions. That's why I talk about our education system, kick-starting our economy and moving Arizona in the right direction. We can do a whole lot better than we are doing today.

Ted Simons: The current governor pushed for a temporary sales tax hike when she thought it was necessary and the voters said okay that one time. Would you push for a temporary tax hike of any kind if this education funding became a burden?

Doug Ducey: I will not raise taxes, and we will fund K-12 education. We can do this. I'm looking at this budget at the next fiscal year. We have the dollars available but I'll tell what you we have to do, Ted. We have to kick-start our economy, get it moving in the right direction. There's only one candidate at the table that's endorsed by the Arizona chamber of commerce and the national federation of independent businesses. These are business and job creators large and small. The way to grow our economy is to reform our tax code and simplify it to lighten regulation, and to make burdens less on the small business owner.

Ted Simons: Make sense to you?

Fred DuVal: Look, I think you've got to be honest with voters about the choices. Doug is proposing we take the income tax to zero. It means cuts to K-12. Medicaid is voter protected. If you want to seek a zero income tax you are going to cut K-12 education.

Doug Ducey: That's not accurate. I should like to improve our tax code. I think we should have one that looks like somebody wrote it on purpose. Simplify it, flatten it, make it more fair. It's the viewers' money. They earned it. I want them to keep more of it. We can go in a better direction with our tax code, but it's going to take time. It's going to take a term or two as governor. It's going to take a growing economy and a more effective government. Fred, you've proposed $4 billion in additional spending and say you won't raise taxes. Please tell me how that works.

Fred DuVal: That's a ridiculous notion. I'm saying we should enforce the Supreme Court decision, the voters are clear in their intention that we pay back these schools for the cuts we took. You want to appeal it; you want to definite the order. You are looking for every opportunity not to invest the public education. You opposed it. Those would have all been more schools --

Doug Ducey: I'm not for tax increases.

Fred DuVal: They would have all been more cuts to our schools. Every opportunity you've had to make the commitment to education you have been on the other side.

Doug Ducey: I've sat on the state school board, I have a commitment to education. I want to spend the dollars responsibly and get them to the classroom supporting the teacher, not just blow more money into these bureaucracies.

Barry Hess: Enough! Quit it! Good Lord. We've got to talk about redefining education in Arizona. We're last in the nation and we're down there in the world, 39th or 41st. We used to be No. 1. They have gotten us away from the competitive schools. That's the whole way that innovation and imagination comes into play. I'm sure we're going to talk about common core at some point. When you're talking about funding it is really not about the money. It is about restructuring. When we had lots of money going into the schools because of Jan Brewer, we saw tuitions at college going up incredibly. How did that translate to the students? A more ubiquitous kind of education is a lot smarter. M.I.T. started it, it's distance learning. They are showing you can get a far better education than their brick and mortar counterparts, without the spreading of disease or bad behavior, without the logistics of security and all the other stuff that comes with these government schools.

Ted Simons: John, the idea, I know you've got business connections here, but you better have a lot of connections to make up for hundreds of millions year after year.

John Mealer: Actually I do. I have an omnibus plan I created, and I believe it'll take people with the dream of a business, a dream of growing their existing business, and put them into the five-year plan of where they can go public if they would like to and retire. Become CEOs, pulling a million-dollar a year paycheck. My plan is that solid and that good. As far as the industries, the hemp industry, we need to legalize hemp. It is not a smokeable plant. It'll replace everything from rubber to fiberglass to create biofuels. It's well into the trillions of dollars.

Ted Simons: You think Colorado and Washington, you think perhaps putting a tax on marijuana

John Mealer: We should do that, as well. We should go ahead and legalize it and tax it as we do alcohol.

Ted Simons: The Arizona poverty rate is higher than the national average and the gap is growing. The national average seems to be dropping; our poverty rate seems to be increasing. Ho our job recovery is not what the national average is. What's going on out there.

Doug Ducey: These issues should weigh on all of us. We want to point out who these people are. These are our seniors, single mothers, these are our children. It's unacceptable. My commitment is to serve all Arizonans so that we can have a better future. The way to do this is have an economy that's growing. I want people to imagine an Arizona where our existing businesses are growing and hanging out help wanted signs. Companies out of state that are seeing Arizona as the perfect place in which to do business. I'm tired of politicians talking about job creations rhetorically. This is something leaders do. I want to go to California and bring businesses here. We're already Chicago's favorite suburb. The businesses are going to Indiana, Florida and Texas. Let's bring them to Arizona. That's how we get the economy going in the right direction and lift people out of poverty.

Ted Simons: The poverty rate here is higher than the national average and the job recovery rate is lower.

Fred DuVal: The poverty rates are going down and the rest of the country, they are going up in Arizona. I started by saying we are headed in the wrong direction. Our economy is not recovering how we need it to. What I hear from businesses looking to relocate around the country, they think Arizona has made a lot of progress towards the tax rate. The regulatory environment, Arizona's not bad. Then the core question: Will my employees have the talent I need to be successful? Will my children and employees' children have good schools to go to? We have to show them a commitment to our schools. And these cut that have resulted in -- today there are 500 classrooms with no permanent teacher. The largest class sizes the United States. We are not making the kind of assurances that business needs to see from us.

Ted Simons: You have talked about tax cuts repeatedly. I'm sure you're aware of what's happening in Kansas. They implemented tax cuts and their growth is zero, they have a budget deficit about as high as the nation. They have schools closing and classes closing and teachers bailing out. Is that what we want for Arizona?

Doug Ducey: That's Kansas. Let's talk about Arizona and Texas and Florida. Let's talk about comparable states people are already moving to. We know how to educate a child in this state. We have three of the top 10 high schools in the country. More than any other state in the nation. No other state has that bragging right. We're spending $10 billion to educate just over 1 million school children. For the last decade there's been a decreasing percentage of resources going to the classroom to support our teachers. That's going in the wrong direction. I want to see every available dollar in education supporting teachers teaching and students learning. That's where you make the difference.
Ted Simons: Can you compare Arizona with Texas, Florida or Kansas, when it comes to low or zero income taxes?

Barry Hess: My plan calls for eliminating the income tax and personal property tax on the moral basis. You can't more lies through government. Each if they come with a gun and say, it's for the children. How do we raise the money? I've moved to it a trance action tax to be capped, combined with a single tax on businesses, a corporate tax of 4% on the gross, no deductions. That will create the environment to bring the jobs here and the money here. We can't have politicians going and picking and choosing who they are going visit and try to get them to come here. We've got to create an atmosphere that's very business friendly and open and honest and aboveboard. I think that would be very important. Along with that we have to fund or education, of course. I think we've gone overboard on our education, trying to teach all of our students everything about every job. In fact, we should narrow that focus to be able to learn the skills to learn, so they master those, and allow the corporations to come in and then further the education for what they specifically need. It makes better sense to pinpoint the education at that point, than trying to teach everyone everything in a government school. It's not going to work.

Ted Simons: Comparing Arizona to Texas is apples and oranges, the property taxes are different as well. Can you compare Arizona to Texas and Florida when you've got Kansas sitting out there like a sore thumb?

John Mealer: I don't think any of them compare, period. They are all different states with different geographical differences. States don't compare, period. Students don't compare. Tax codes can't compare because they have different needs, different wants. I can tell very clearly how we can take someone such as -- anyone at the table here that wants to create their own job, Cold Stone before it was Cold Stone, you needed funding. I detail exactly where that comes from. Detail exactly where that money will come from to create that water company, and take you to being a global company if you want.

Barry Hess: I think it's more important to get government out of the way. We saw in California two weeks ago where they repealed one law against vending, and created a thousand businesses in three days. That's how government creates businesses is by getting out of its way and allowing it.

Fred DuVal: I think Kansas is a warning sign to avoid a race to the bottom. And their complete bond market, they are getting new ratings, disinvesting in their schools. Employers are very concerned. Schools have taken massive cuts. We want to stop the cuts and get back to investing in our children's future.

Doug Ducey: The big spenders want to take one year and become an alarmist. There are nine states in this country with a better, more preferable tax code that we have. Not only are we comparable to places like Florida and Wyoming and New Hampshire, we're competitive. States compete and governors compete. These companies leaving California and leaving Illinois are looking for a place to go. We have a quality of life here. This is a great place to live, work, play, recreate, retire, visit, and in many cases get an education. We have to stop the blame Arizona first mentality. I'll sell our state. I'll talk to leaders, business owners and influencers and we'll drive our economy in the right direction.

Ted Simons: I hear what you're saying but I keep hearing California is just the definitely on the West Coast here as far as business and economics are concerned. They are always at the top of job creation; they are always at the top of wages. Companies are moving to California to benefit from a variety of things that it seems like in Arizona we're still debating on, things like education and such. How do you square that?

Doug Ducey: Well, California is driving people and producers out, Ted. This is not a well-run state. This has been the largest growth in our state, net migration from California and Illinois to the state of Arizona. It is a beautiful state and there's been incredible innovation. But they are doing everything they can to kill the golden goose there it may not be good for the country but until the next decade, the Governor of Arizona should take full advantage of it. I just visited a company last week that had moved here from California. They couldn't take the tax burden or the quality of life. It's a rat race.

Ted Simons: How do you explain that California still leads in job creation and all these other metrics and we don't?

Fred DuVal: They invested in their Universities; those are gifts that keep giving. They are going after 21st century innovation based jobs. Silicon Valley, I.T., et cetera. That's the connection. We need to commit to investing in education. The idea that we can be a Texas or Nevada, they have game, taxing and oil taxes of. They simply capture their revenue someplace else. I don't know whether Doug's suggesting a property tax other a sales tax. But if you are going to repeal 40% of the state's revenue, you either cut K-12 education, which I believe he plans to do, or you raise taxes someplace else.

Doug Ducey: That's a distortion of my record. Fred's model state in California, my model state is Texas. I'll take the path of Rick Perry. You take the path of Jerry Brown. Texas has led the country in economic development, job creation, business relocation; I want to be your next cover in November of 2014. I believe Arizona can lead the way in that direction.

Fred DuVal: I did not say that we should follow California. I said investing in education is something that is working. It has worked across the country. It is time for us to make sure our children have the skills to succeed in life. And your proposal to cut education --

Doug Ducey: I did not propose. I did not propose -- I am saying that I would settle this lawsuit. But I want to see these dollars go into the classroom. I want to see them fund -- I have no power to settle the lawsuit.

Ted Simons: But you would be all right if the lawsuit were settled.

Doug Ducey: Oh, I would much rather pay teachers than pay lawyers, so yes. But the baseline on the lawsuit is important. We have scarce funds. I want to make sure we can be responsible going forward. So I would sit down -- and this is a hypothetical, Ted, dangerous in these debates. But I would like to settle this and put the appropriate amount of money into K-12 education. Any chief executive would ask where are these dollars being spent, how do we best serve or teachers and our children?

Fred DuVal: You just said you will take the settlement?

Doug Ducey: I said I would settle the law enforcement I want to negotiate the base lain. 's important.

Fred DuVal: The offer is on the table.

Doug Ducey: Its $80 you know, to $320 million. I'm open-minded.

Fred DuVal: If they made the offer would you take it?

Doug Ducey: I'm open minded to settlement. I want to see a smaller baseline to protect our basement going forward. Fred, have you $4 billion in additional spending.

Fred DuVal: Doug, stop it.

Doug Ducey: If Fred, is that tooth fairy math, at least the tooth fairy delivers a buck or two under my son's pillows. At your house it leaves an I.O.U.

Fred DuVal: I sure I my six-year-old got his buck.

Barry Hess: We have to be careful looking to California for job creation. They just get a lot of short-term job creation because of more legislation. They are not long term high-paying jobs.

Ted Simons: But the circus is going round as opposed to standing outside with a ticket in your hand.

Barry Hess: Requiring higher and higher taxes and more legislation.

Ted Simons: Is that an option?

Barry Hess: Not with me.

Ted Simons: What about you, John?

John Mealer: No. If you're picking states I'm picking Arizona. I believe Arizona would be successful if we did not have party politics getting in the way. Someone with a good idea should not need to bribe a Republican or a Democrat just to get a vote to make something good happen for our state. For the past 102 years that's all we've had. That's why we're at the rock bottom.

Barry Hess: We've seen the border issue, ever since I got here in 1980, it's been exactly the same. Not a Republican and not a Democrat has moved to correct anything or change anything. But the same is true of our education system. We saw it sliding down. We have to step back and take an intelligent look at reshaping our government and how it interacts with the people. I think that's really critical.

Doug Ducey: With the way everyone's talking I'm amazing anyone lives in the state of Arizona. I think this is a great state. I ask in every year, 70 our 80% of the hands go up. That's the market speaking. People are moving here. We need to bring businesses here. We need to maximize population growth into economic development, job creation e and win more companies coming here, Ted. It's very doable. A chief executive who will be a leader and be accountable for this can make the happen.

Barry Hess: We need chief executives to get government out of way.

Ted Simons: We hear a lot about corporate tax credits, Republicans have been in power for quite a while at the capitol. We've seen these things going through. When do we get that Arizona turn-around?

Barry Hess: When you get a Libertarian governor who breaks the tie in this gridlock and take some sensible action. I'm literally the only one who can walk the aisle without fear of political repercussion. A historic moment over 35 years and 35 tries in putting forward a citizens' referendum on some of the most egregious laws ever devised, trying to steal the elections. We turned it back on them and made them eat it. It took everyone from the super liberals to the super conservatives; I was the only one who could bring that together as an architect of it.

John Mealer: I'm not other guys, the one that has no tie whose doesn't care about a political life. I can come in, I already have the plans written down. I know I'm beyond a long shot. But I'm not elected, everyone here agree to at least hear me out on this omnibus plant it is the only thing that's going to save Arizona right now. Legalizing hemp would be a great plan but the omnibus plan will take us from zero to hero.

Ted Simons: Everyone bad-mouths Arizona. What is Arizona's image around the country? We are the butt of jokes on some programs and people keep moving here.

Fred DuVal: I've written two books about Arizona, I love Arizona, I'm passionate bit, I'm Mike hiking it and I love every part. We have an opportunity to remind the rest of the country how innovative we are, how much we're a start-up economy what, a great environment this is to start businesses and to grow. But we have to answer this question about our investment in public education to get the kind of job growth we've had in the past and we want in the future.

Ted Simons: Do you think Arizona has an image of intolerance?

Doug Ducey: No, I do not. I think we have very real issues in the state but whenever you have a state when so many have moved here from all across the country, it's a place that's warm and welcoming and optimistic, good things can happen. Some folks have communicated some issues that I would do differently. When I say I want to take charge of the direction of our state, that's what I'm talking about. There's only one candidate at the table that has built a brand known and loved around the country and now the world. I think the Arizona in many ways as blank slate. I want to communicate that out.

Ted Simons: You think there's no reason to attempt to repair Arizona's image? There's nothing to repair?

Doug Ducey: I think we have to go forward. We were here in 1995 when someone was saying things and striking down Martin Luther King Day. I would say it was worse. The NFL took the Super Bowl away. We're going to have a January where the eyes of the world are focused on our statement there's nothing like a new governor to set a new tone and new direction.

Fred DuVal: And Ted, I think 1062 did do some damage to our reputation. I wish the Governor had moved more quickly, she got it right in the end. These kinds of things are cultural le divisive. We're a tolerant place. We need to celebrate our diversity, grow with our diversity and make sure that our -- that we are communicating a place where talent no, matter who they are, can come and succeed in Arizona.

Ted Simons: Would you look at a 1062 if you were governor?

Doug Ducey: I said you would veto that. With any issue, I would bring people to the table. You heard when I kicked off tonight, this is Democrat sitting state legislator, Katherine Miranda has joined my campaign. I'm reaching across the aisle to show that I'll do what's in the best interests of all Arizonans. My campaign is about opportunity for all. I'm running to be the cover of all the people. You can tell a lot about how someone will govern by how they campaign. That coalition is something that you want to continue to broaden. I said I will listen to everyone, just like I've been listening to parents and teachers across the state.

Fred DuVal: My coalition includes hundreds of Republicans. I bought a full page add recently, it including 20-some Republican elected officials with who I've worked. We built access, we built the Phoenix Peoria system, we did the groundwater code. Some of the greatest bipartisan achievements in the state of Arizona, we were growing and succeeding in a bipartisan collaborative way. I've carried that experience through my lifetime as a result I'm really a problem solver. I can demonstrate my capacity to create collaboration.

Barry Hess: I can see a problem with that just in saying bipartisan. That suggests two. There are more two and the arrogance is pervasive. I think that's ridiculous. But when you were talking Ted about the reputation of Arizona, I think most people separate our more colorful personalities from Arizona itself. Because they hear from all of us, it's a great place. We've got great weather other than yesterday and the day before --

Ted Simons: Are businesses hearing that?

Barry Hess: Businesses not so much. They are not so excited about our Oklahoma's, meaning virtually nothing. We have go to the get kids who can learn. Let's go to a competency test. That would make more sense. It doesn't matter where you get your education, we don't care. We just want to make sure you are educated and you pinpoint your weak spots South Korea work on them without the whole blanket idea. We've got bring businesses here with the idea we're going to do something bold and different. We enjoy being Arizonans. Here what's we offer corporate America: You bring your own damn schools here and teach the kids what they need to know to work for you.

Ted Simons: Your investment idea, can they work if -- if -- Arizona doesn't have a strong enough image that attracts business?

John Mealer: Yes, because they are to be based on Arizonans becoming the people they want to be. Not all of Arizona wants to sit around living on minimum wage or welfare or whatever it might be. There are millions in Arizona that want to get to work, create the jobs. We've got Don Frank that now blocks anyone from investing in a business unless they have $2 million in the bank. We need to work above, across and just totally squash that horrible law.

Ted Simons: Let's get to some immigration laws here. The Governor's idea being that the rule of law has to be applied at some point. Is that valid?

Fred DuVal: I think this was a mistake. 48 states allowed Dreamers to drive. We should join the rest of the nation and there are important reasons why. These dreams are a part of our community they have been raised here, been successful here. They have served in the military or are going to school. They contribute to our economy, it's important they are as successful in life as they can be. Secondly, for public safety reasons it's important they be insured for everybody's safety. But this has been a divisive way of treating members of our community and it's a bad policy. I will change it.

Ted Simons: Do you agree with the governor's decision?

Doug Ducey: I think we need to step back and look at how we got here. The discussions around border security and immigration. It really isn't just one party's fault. There's enough blame to go around here. This is the federal government that has not paid attention to its first duty to Arizona. I have agreed with the governor's decision. I am going to have respect and compassion for everyone. But I don't think anyone gets the privileges and benefits of hardworking Arizona families that are paid for by hardworking Arizona taxpayers. We're a nation of immigrants and we're a nation of laws.

Ted Simons: Critics say it's a mean-spirited move and counterproductive. How do you respond?

Doug Ducey: I say to our federal government, what are you doing on our southern border? We have a state that has a wide-open and unprotected border in the Tucson sector. This has been going on for years. We have border patrol agents by the thousands that are in this state but they are not inside our border counties. I would like to see us be able to work not only with our county sheriffs, our law enforcement agents so, that we can address some of the very real issues happening in the state. Then we can deal with some of the other issues around immigration.

Ted Simons: So not mean-spirited or counterproductive.

Fred DuVal: It is counterproductive and mean spirited and bad economic policy. We want to make sure these Dreamers can fully contribute to our economic growth and success. They are part of our community; they will be part of our community. It's really important we give them the tools to succeed.

Ted Simons: Do you think these Dreamers should be deported?

Doug Ducey: No, I've never said that. I said I'm for opportunity in our state and that's the Governor I want to be. I have talked about the priorities as to how I'd like to see this issue unfold.

Ted Simons: The rule of law, at some point no deportation.

Doug Ducey: Let start with border security.

Barry Hess: I've had the opportunity to travel in a lot of countries and drive, I took their test and got their driver's licenses so you can get insurance. People will still drive, they will drive uninsured. That's a big issue these days. But it's not just the Dreamers, either. Anyone should be able to come here on a visitors pass. If they want to work, fine, we can tag them with a 5%, which I've proposed, for non-nationals to go into a fund if they want education, medical care, if they want whatever they want. Let them do that for access to our markets. Rather than impose upon the American taxpayers. That's where the distinctions have to be made. Government unfortunately does not run like a business. It runs the opposite as a business. That's what's becomes very scary. You've go to the know how to spend money. That's what you've got know with government. With a business you you've got know how to make money.

Ted Simons: Do you want to see government run like a business?

John Mealer: Government needs to be run like a government but they need to protect the businesses. The government cannot make a profit. We need to break even. We're not even doing that. We need those businesses to exist to pay in the taxes. As I was stating before, the property taxes for the businesses on property that is not normally taxes, millions of acres.

Ted Simons: And again, running government like a business: Is that something you think government should look harder at?

Fred DuVal: There are elements of business that plate to government but as the different function. Government is in the business of public safety and creating a climate for private sector opportunity. There's no question you want to bring accountability metrics to government. I did that on the Board of Regents. I've proposed an entirely new enrollment system, holding them more accountable for outputs for graduation. Those kinds of things are applicable to state agencies.

Ted Simons: I asked the question: John mentioned business isn't in the business of making property. Government is in the "service."

Doug Ducey: Government is not a business. Businesses are intended to grow and make a profit. But what you can do with a government, there are some business principles like paying proper attention to the people which it serves. Our hardworking taxpayers, on being accountable, actually living within your movies. When you're in a business setting the budget actually means something. Meaning what you say, saying what you mean, paying attention and serving in this case not the customer but the taxpayers. I think that's the best principles of government that you can add from the business community.

Ted Simons: Let's go to dark money. Do Arizona voters deserve to know who's paying for the ads attacking you and attacking you? Do we deserve to know that?

Fred DuVal: Yes. I wish there was full disclosure of the donors that were part of dark money. I issued a dark money challenge, join me in calling out the dark money and saying, don't come here. We will conduct this campaign through the candidates' voices, not the dark money voices. This has become very corrosive to our ability to have an exchange of ideas. Folks who are nameless, faceless, don't live here and don't know the candidates or our issues.

Ted Simons: How do you find out those names and faces? It's Byzantine to get these those.

Fred DuVal: They should be disclosed and state and principal law should require their disclosure. They are not going away. The best we can do, get them disclosed and let them be a part of the public process.

Doug Ducey: I'd like to see more transparency, as well. I think it's interesting that Fred says that, though. You were the money man for the Democrat Governor's association, the same organization running these ads. You're the person who collected the money to buy these ads in your past career.

Fred DuVal: Doug, you've had millions spent by the Republican governors association to attack me, millions of dollars. Before that you did it with Christine Jones, Scott Smith. You've succeeded by tearing down your opponent. You should just stop it. You should stop it. This is about creating an affirmative agenda.

Doug Ducey: People judge me by what's coming out of my campaign, it's been a positive, optimistic pro job. Fred, we're both playing by the same rules. I'm new to politics, people know what I've done with my career. I've been selling ice cream. You've been pedaling influence. You've been the Democratic bagman for these ads in the past.

Fred DuVal: My background is completely open. Everything I've done in my life is public. You've sold a business and it is a closed file. I've got a question for you. Doug, what happens what happened in that arbitration? I think the voters deserve to know whether or not you were accused of material misrepresentation. Were you accused of material misrepresentation?

Doug Ducey: What was there was the people that purchased Cold Stone creamery said there was complete satisfaction, I built a great company and I would build a great brand. Fred, what you have not done.

Fred DuVal: Yeah, my background is public.

Doug Ducey: Would you disclose your list of clients as lobbyists? Can you tell us what your list of clients were?

Fred DuVal: Doug, they are on our TV ads. They are all on your TV ads. I'd like to know what happened in that arbitration and whether or not you will answer the question, were you excused for holding material --

Fred DuVal: You did not answer my question.

Doug Ducey: Yes, I did, complete satisfaction.

Barry Hess: Come on now. When we talk about dark money, we're talking about money that's not supposed to be coordinated with the campaigns. I would think there would be a great penalty because any of these groups have the right to expression, of course. It would disqualify the candidate, make it something serious. There's dark money right out there in front of God and everybody. It's like two debates. John and I were excluded from them in channel 10, channel 12. That is en-kind advertising for lines Democrats. That's as dark as it gets.

Ted Simons: My question is, though, when I comes to so many of these ads that are attacking these two gentlemen, shouldn't we be able to know who's behind the ads?

John Mealer: We know who's behind the ads, the Democrats and Republicans.

Ted Simons: A little deeper in the onion than that.

John Mealer: We could probably find out the individuals. But they are tied to Democrat and Republican parties. That's where all the trouble comes from. That's where it'll stay.

Ted Simons: All right. Let's move on, access, expansion/restoration. Did Arizona do the right thing?

Doug Ducey: What I've said on this issue is the Governor and the legislature have done what they have done. I've spoken out pretty aggressively against Obamacare and that I'm no fan of it. I think it's a rolling disaster and a monumental failure. As governor I want to focus on our budget situation so we're spending the proper dollars to restore K-12 education and to move our economy in the right direction. I'm not a big fan of any expansion of government. What we have right now is a three-year guarantee from our federal government, this is something that our next governor will have to look for ways to improve and reform. Some ideas I have for that are more price transparency and health savings accounts.

Ted Simons: If the legislature passed some sort of appeal of this expansion restoration, hypothetically What Would You Do?

Doug Ducey: It is hypothetical. My first job would be protecting Arizona taxpayers. We do have the guarantee from the federal government and I think we would not want to do that.

Ted Simons: You would not repeal it, at least not for the next three years.

Doug Ducey: Where I think the opportunity is, is for reform. Everyone wants to have access to a superior health care system. I want to see that, as well. I don't think our federal government has done a good job in delivering.

Ted Simons: You said the Governor and legislature did what they did.

Doug Ducey: I'm running on the issues of the future. I'm not a huge fan of the expansion of government. I would have wanted to tinker with the reform. Some states are innovative and inventive. But I think our governor was not delivered. He was she was the leader in that case and I've said what I said.

Ted Simons: That is a good enough answer for you.

Fred DuVal: It doesn't answer the question, of course.

Ted Simons: How you would handle the repeal, which is certainly coming.

Fred DuVal: This is a legislation that wants to repeal the restoration of Medicaid. Doug was silent on Medicaid and against it, now what's done is done. It's a little unclear. I have had one position on this through my life. I helped build access with the governor's help, a national best practice. We negotiated this out and took it to the Reagan White House and received the first Waiver of the kind that enables us to do this very successful model. The restoration is a very good idea. The team and governor that put it together were correct in doing so, to repeal it. It'll knock hundreds of thousands of Arizonans out of their health care. It would be a very harmful thing to do.

Barry Hess: We've got an access program here second to none. Everybody wants to get on access, and unfortunately they are. That become as big problem. A thousand a month or more per person, it become as real burden to the taxpayers. I would like to see the taxpayers absorb some of the risk of being alive. They used to. It is not a plus to say it's growing and expanding. It's like a welfare program. Now we've got 50,000 new people on it, that is an abysmal failure as far as I'm concerned. We don't want people on the government dole or dependent on government. Like the welfare cards over in Maryland, they shut down for a week and drove people into a panic because now people were totally dependent upon government. I want to see an Arizona where we get back to the self-responsibility. We take care of ourselves and encourage others to do that, too. When the power goes out we've got a battery pack on our house. We don't go out. I think that kind of forward thinking is a smart idea. I want to make Arizona a fun place to live where we're innovative, not just holding on to the past.

Ted Simons: John.

John Mealer: Thanks. We can do better. Access has its problems right now. They have they are cutting people off like my wife f they have cancer. Certain treatments are cut off right towards the end. That's where we're sit something.

Barry Hess: We can't deal with that type of a system. We can do better. I have a very, very detailed plan in my book that explains how we can get the best insurance for every Arizonan plus some, plus some. And add to the whole -- I think it should be health care. I saw this whole argument switch over to let's give everybody insurance. I want to revitalize the county hospital program so people aren't dying in the street. It's not government's responsibility to cover them for insurances for drying out loud.

Ted Simons: More people are insured right now because of the expansion, uncompensated care is getting to be a more tenable situation. Is that again a bad thing for Arizona?

Doug Ducey: Whenever we have more people that are protected I think that is a good thing. My concern is what happens over the course of time. That's why I talk about a health care system that's putting the patient in charge of doctor-patient relationship, rather than the insurance company. I think we've got the best system in the world but I don't think we have the best distribution system. What we've seen is really a redistribution of insurance benefits. I think we can do better. There are many doctors, Ted, refusing to take access. Why do we want to put more people on an insurance program many doctors don't want to accept?

Ted Simons: Penny wise, pound foolish?

Fred DuVal: I think the circuit-breaker is a good idea after three years. I'm very confident the federal government will not walk away from its commitment. The reimbursement rate in access is very, very high. If they do after three years, we've got the circuit-breaker. But we've got a 90% reimbursement rate on this. This is money Arizona taxpayer money, which will go to other states or the state around us who have taken the opportunity to do restoration. We would be foolish to repeal it.

Doug Ducey: Did Fred just say he's very confident the federal government will not walk away from its commitment?

Fred DuVal: We've got the circuit-breaker. We need to move forward and not repeal it, Doug.

Doug Ducey: I didn't say that. The federal government is here to help us, right?

Fred DuVal: I do believe the circuit breaker is the right tool. We should not use the fear around this issue to not take advantage of this opportunity to stabilize our economy, insure our health care opportunities and do it as this kind of reimbursement.

Barry Hess: Talking about tools, it makes more sense to get government completely out of people's health care. The estimates are running between 60 and 80% drop in all aspects of health care. 60 to 80%. And these are people who do the HIPA compliance and all that nonsense. We'd be able to handle it out of our own pockets.

Ted Simons: We're running out of time. We've got goat closing statements. We've talked about the federal government, amusing they would keep their end of a bargain. How is Arizona supposed to work with things like immigration, for example, and other aspects in which a relationship with the federal government is important, if we have an antagonism towards the federal government?

Doug Ducey: We'll have no leadership in two years. In the interim I want to make the case for what we want to do here in the state of Arizona. I think the endorsement I announced shows that I'll reach across the aisle. I want to bring the most innovative and inventive ideas. I want to get our dollars back in this state to be in charge of many of these programs. I will work with the federal government but I'd like to be the Governor and take charge, not have it run out of Washington, D.C.

Ted Simons: Quickly, how do you become -- we never each got to common core -- how do you avoid that federal intrusion when you're trying to work with something like the federal government. How do you keep your own, stand up to your own?

Fred DuVal: You have to speak for Arizonans. Frequently Washington, D.C. is out of touch, doesn't understand the west or Arizona. And Arizona's governor has an important role to play in making sure what is unique to Arizona that, we that they respect what is unique about Arizona. We can chart our own destiny. We are pioneers innovators, but we have to have a functional relationship with the federal government to make it work.

Ted Simons: Each candidate will give a one-minute closing statement. Going in the reverse order of opening, we start with Barry Hess.

Barry Hess: I hope everybody has seen a good debate and you've gotten the ideas of our permits. This whole idea of growing government by both of Republicans and documents is a poison cake. It'll taste good and they will offer you another slice but it's going come back to haunt all of us. Please go up to he isforgovernor.com and see completely issues where we've put them up there for people. We've got a little bit of a minute here, on common core, it's an idea that wants to homogenize all of education. That is what destroys education. What made us great was our innovation and competition. When I was a kid we used to be able to say my school's better than your school and we could back it up. With common core, kids say, my school's just like yours. Don't let the future of Arizona rest on and lack of innovation. I ask for your vote.

Ted Simons: Thank you, thank you very much. Doug Ducey now.

Doug Ducey: My name's Doug Ducey and I do want to be your next governor. It's been great joining you for this debate. I'm running on real world experience as a businessman and job creator. I've managed $12.5 billion of your assets that are by any measurement are in better condition and growing faster than they were just a short time ago. I've built the broadest coalition of any candidate. You can tell a lot how someone will governor by the way they campaign. I'm proud to have Katherine Miranda on my team. I'm proud to have every one of my Republican opponents part of the campaign and moving forward. I want to be an independent voice to kick start our economy. So Arizonans can find a job and a fulfilling career. I want to restore the greatness of our K-12 education system. Doug Ducey.com, if you want more N. thanks for having me tonight.

Ted Simons: And now for our next closing statement we turn to John Mealer.

John Mealer: Hi, I'm John Mealer, jlMealer.com to check out my website. I believe Arizona needs to run Arizona. I don't believe the parties are acting in our best interests. They are all located in D.C., or at least the outlying areas. That's where the money's coming, from the dark money we keep hearing about. I don't think there's really a debate. The money is paying for the candidates now? Is it paying for the elected official later? It's going do both actually but it will be paying definitely for the elected official. We've been in statehood for 102 years, it hasn't changed. Ds play for Ds and Rs play to Rs and they leave us out. Arizona it left in the middle. We need someone that has plan already on the table. Someone willing to do what needs to be done and doesn't have a political future to worry about. Thanks.

Ted Simons: Thank you very much. Fred DuVal now with his closing statement.

Fred DuVal: Thank you, Ted.

Fred DuVal: We have a lot of work to do to move Arizona forward. We are filled with opportunities to do that. It all starts with our children and making sure they have the tools to succeed and we need to stop the Michael Cuddyer to our education system in order to provide that kind of future. In Arizona with test scores are going up, class sizes are going down, teachers are paid a livable wage so they stay in the classroom and give our students the skills they need to succeed. Where we transform our education system in a way that provides the skilled workforce of the future. When we do that, new businesses will come, new technologies will come. They are hungry for an educated workforce for the future. That's the kind of Arizona that we want. It means jobs, it means opportunities and it means a new day for Arizona. Thank you.

Ted Simons: Thank you, candidates. And that is it for now. I'm Ted Simons, thank you so much for joining us. You have a great evening.

Doug Ducey:Republican Candidate, Arizona Governor; Fred DuVal:Democratic Candidate, Arizona Governor; Barry Hess:Libertarian Candidate, Arizona Governor; John Mealer:Americans Elect Representative, Arizona Governor;

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