Governor's Views

GWEN IFILL:

State governments have been attempting to balance the new homeland security demands against other concerns, in many cases raising taxes to pay for health care for the poor or for education. The nation's governors met with President Bush and members of his cabinet today.

And here with us to talk about some of their concerns are: Dirk Kempthorne, the Republican governor of Idaho and chairman of the National Governor's Association; and Mark Warner, the Democratic governor of Virginia and vice chair of the association.

Governor Kempthorne, Secretary Ridge met with you as well and talked a little about what he says have been the improvements in information sharing between the Department of Homeland Security and the state. What is your take on that?

GOV. DIRK KEMPTHORNE:

I agree totally with it, Gwen. Secretary Ridge in fact-- I think every time we've had a meeting of the National Governors Association, he has been there. I serve on the president's Homeland Security Council and again Secretary Ridge is always there. To give you the idea of detail that Secretary Ridge goes to, he gave us his number, that if we ever had a problem that a governor felt, "I must get to the secretary immediately" and so I programmed it into my phone. And so it shows you that he is hands-on.

We did discuss this aspect about a perceived logjam. Are we getting the funds from the federal government to the states and the states then to the local units of government? We think that it's a perceived problem, but as long as the perception is there, we have to deal with that. So we agreed to a request from the secretary, and that is that representatives of the National Governors Association will meet with the secretary and representatives of local government, and we'll work this whole problem through.

GWEN IFILL:

Governor Warner, what is your take on how much of that problem, that logjam that Governor Kempthorne referred to, is perceived and how much of it is real? The U.S. Conference of Mayors have complained to the president, the president said he understands that money sometimes gets stuck at the state level and he wants to help un-stick it. What's your take?

GOV. MARK WARNER:

Well, actually, speaking from Virginia's standpoint we've been very successful at moving the money downstream. As a matter of fact, many of the governors said we'd be willing to work with the administration to even put some kind of 60 or 90 day time limitation so we can demonstrate that we get the money through the system down to the first responders at the local level. But it's very important, all the governors absolutely believe that we need to continue to have the state be that coordinating role.

We don't need the Department of Homeland Security-- and Secretary Ridge doesn't want to do this by any means-- writing eight or nine thousand separate checks to all these local first responders, local governments for homeland security. We've got to make sure the state plays that coordinating role to make sure there's not duplication of service and duplication of effort and I think he understands that as well.

GWEN IFILL:

Governor Warner, as you well know, it all comes down to resources and there's another subject which has been occupying governors in the last year or so and that's tax cut-- not tax cuts, but raising taxes.

GOV. MARK WARNER:

Right.

GWEN IFILL:

In Virginia you've been advocating for increased taxes, even in Governor Kempthorne's state of Idaho that's been happening. What is your sense of where that stands now and whether that comports with Washington's effort to cut taxes?

GOV. MARK WARNER:

Well, we don't have the printing press at our state capitals, we've got to actually balance our budgets, and I say that both in terms of the administration and the Congress. But we are dealing with in I think many, many states is the aftermath of the run-ups in the late '90s when many states pretty much took actions that were not long term sustainable.

In our state we are putting together a whole tax reform package, it's actually been supported by our Republican Senate, they've got a plan that's three or four times larger than ours. So I think a lot of states are dealing with the revenue issue. One of the things we're asking for from our partners at the federal level, though, particularly in the area of Medicaid, is a little more certainty. We'd love to see coverage of dual eligibles, but if we're not going to get that with the federal deficit running up higher, we would like to see the federal government make sure and we've pressed this point with the president today and he was responsive, making sure that Medicaid, the administration of Medicaid isn't constantly changing the rules mid stream.

There are a number of practices that all kinds of states have used in the past that are currently being reexamined, in many cases being turned down, procedures that have been used in prior years and that really is throwing states into a further bind because Medicaid costs unfortunately are rising three times the rate of inflation.

GWEN IFILL:

Well, I want to get back to Medicaid in just a moment. But I do want to ask Governor Kempthorne the same question about raising taxes, and whether that in any way puts you in conflict with your national party?

GOV. DIRK KEMPTHORNE:

No, I don't think so, Gwen, and I'll tell you why. The president's tax cut package, I think, the economists have affirmed that it has helped stimulate this economy without question, and we're now coming out of a recession. We're onto a recovery. We have to provide the basic services and we have a requirement in our state as do most states that we have to have a balanced budget, we cannot deficit spend. And I agree with that philosophy. And I was just not willing to make dramatic cuts to education.

That's an investment that I'm going to continue to make in the state of Idaho, because when you have your children well- educated, then you have a future. And so again I think that where the president used his tax cutting policies to stimulate the economy, the states are providing the basic services. We have that one additional cent of sales tax which will expire now June of '05. And so I think that is very compatible and consistent, and we continue our partnership with the federal government.

GWEN IFILL:

Do you agree with Governor Warner that Medicaid is the burden that he says it is? And if that's the case, what can the federal government do to help you cope with it?

GOV. DIRK KEMPTHORNE:

Medicaid is one of the fastest growing areas of any state's budget, and in the double digits upwards of 15 to 21 percent. One of the things we can do is just to give flexibility to the states. Secretary Thompson has provided during his tenure as secretary of Health and Human Services 3,600 waivers which are more waivers than all of his 18 predecessors provided, combined.

So Tommy Thompson being a former governor understands this, but we've encouraged him to continue that. Governor Warner and I asked him on a new rule change that came out and the only we're going to provide for 24-hour comment period in the Federal Register, we asked him please review that and change that.

GWEN IFILL:

If I can interrupt, that rule-- I want to explain to our viewers-- that rule would have allowed the federal government to review state decisions on Medicaid spending, and you objected to that pretty strenuously, didn't you?

GOV. DIRK KEMPTHORNE:

We objected to how it was being suggested to be implemented. And so to his credit, the secretary rescinded that and said that he will now negotiate with the National Governors Association and then when they do go back to the Federal Register there will be a 60-day comment period, this is something I spoke to the president about personally last night. He agrees totally with the president and says we need to be realistic, so we appreciate that approach by the president.

GWEN IFILL:

Governor Warner, what the president and Tommy Thompson are suggesting is taking another look at the process, but do you know if that plan of having increased federal oversight over state Medicaid spending is dead?

GOV. MARK WARNER:

Well, here's, I think, the bigger issue, Gwen-- echoing what dirk said. Medicaid costs continue to soar, and Medicaid is no longer just about poor people. In Virginia, two out of three nursing home patients receive Medicaid. This is a health care program that affects wide, wide swaths of our population, and the costs are rising. What we're saying with the CMS Organization which administers Medicaid is, all we want to make sure is we've got some ability of predictability.

This recent rule change, part of it would have actually required states to have their whole Medicaid plan together six months before the beginning of the fiscal year, and most states don't have their budgets together at that time. So I think the president and Secretary Thompson responded appropriately. I do think in terms of some of the whole Medicaid procedures, states don't come to this process with clean hands.

There's been a number of actions done by states in the past where Medicaid funds weren't always used for appropriate purposes. Our feeling is, at least my feeling is, if we've got problems in terms of past procedures let's deal with it forthrightly, let's go ahead and review the whole process, and not simply be relying on what may have been inappropriate past procedures and have CMS kind of rule in what appears to the states on kind of an ad-hoc basis, let's clear the air and move forward.

GWEN IFILL:

Governor Kempthorne, finally let's talk about education, another big issue on your plate. A lot of states, led by Republican governors and Republican legislatures are leading the charge against or appear to be leading the charge against the president's Leave No Child Behind Act. Where does that stand?

GOV. DIRK KEMPTHORNE:

I would not characterize it at all that they're opposing the president's efforts at his program, and "leave no child behind." The president affirmed today that he is dedicated that no child be left behind. And I think all governors agree with that vision. I think in many cases it mirrors what we're doing in the states, what the president affirmed today and what Secretary Page affirmed today, is the fact that there will be flexibility, any state can amend its state plan, there's a process to do so.

They have already made changes in some of the programs, special education for example, they put an additional $1 billion. And I think very significantly as was pointed out today in a meeting at the White House, the term "failing school" does not appear anywhere in the bill which the president signed nor anything that the president talks about. That is the concept that somehow has been derived. We do talk about achievement, or areas where improvement is necessary. But identifying those areas where improvement is necessary means additional funds can be brought into it, but we do not have some list of failing schools, because we're not dealing with failing schools, we're dealing with successful children.

GWEN IFILL:

You mentioned that Secretary Rod Page who earlier today-- the wire services are reporting-- said to you governors in a private meeting, described the National Education Association which opposes the No Child Left Behind Act, he called it a terrorist organization. Did you hear him say that?

GOV. DIRK KEMPTHORNE:

Well, there were a lot of things that were said, but Secretary Page made it very clear his support for teachers and referred to it, really I think, as the noble calling that it is and had some very complementary things to say about teachers, so he is an educator and he believes in our teachers.

GWEN IFILL:

Governor Warner, what was your take on secretary page's comments, and in general on the status of the No Child Left Behind Act right now in the states?

GOV. MARK WARNER:

I did hear Secretary Page make that comment and I was surprised, I was... I do not adhere to that at all. I hope he will issue an apology, I believe he has, I think that would be appropriate. Matter of fact, the teachers organization in Virginia has been helping us as we move towards accountability.

Two quick points on "no child left behind": One is we obviously all support increased standards, greater accountability. We want to make sure that states like Virginia though, that have already-- are actually further ahead than the federal government in terms of our own state-based standards don't get penalized for, in effect, leading the way. And we actually believe, and my Republican House was very strong on this, that they view some of the requirements of leaving "no child behind" as almost unfunded federal mandate. So we would like to see some additional federal dollars come down the pike to make sure that we can have the resources to leave no child behind.

GWEN IFILL:

Governor Mark Warner and Governor Dirk Kempthorne, thank you very much, both of you.