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Gov. Gary Herbert, (R-Utah), on the fiscal cliff debate’s impact on states’ budget planning.
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Thanks so house speaker Boehner expressed his frustrations on the fiscal put this morning stating it is not a game individual states are affected by all this rhetoric and a big way.
We're talking budgets of the central programs that could get the -- so how was the state of Utah -- in all of this it's day four of our governors on the edge series we welcome you talk governor Gary Herbert.
You know Fox Business exclusive welcomes governor and then we are thrilled to have you because.
You actually have a pretty good story to tell at the moment with the fifth lowest unemployment rate in the nation but.
We begin by asking all of our governors from Delaware to Pennsylvania.
To Rhode Island these are the ones we've already had to say.
What are you doing -- what action are you taking in advance of what could be a fall off the fiscal -- Well we've done -- so I think proper imprudent one we live within our means.
We don't spend more than we take yen we don't have unnecessary debt we actually save for a rainy day we ever any day surplus fund.
Which helps insulate is against some of their ups and downs of the market place nationally.
And because of that our unemployment rate has dropped from eight point three -- five point two.
We're creating jobs how we're going -- wealth in the private sector our personal income is going up about the fourth or fifth -- in the nation also so.
We're doing things that they ought to be doing in Washington DC.
In the next three weeks as you have meetings with your staff you tell me -- we we talked to for example the governors of Pennsylvania and Rhode Island said they've they've almost actually have to prepare to separate budgets.
The status what you do what how are you expected to be affected if say for example you know with 30% of your budget coming from federal funding.
What happens if that goes away.
Well 80% that have tried as an impact this at all in and the -- you -- But there is some impact in there's no question that we are in fact caffeine too in fact prepare to budgets how one if we don't have the fiscal well.
As we put together arm our money's you know our state budgets about five point 75 point eight billion dollars.
We and anticipate about 400 million dollars of new growth revenue that's healthy for the -- you talk.
But we recognize if they don't come up with some kind of solution.
About 200 million dollars of that probably will not materialize over the next year because of lack of economic growth.
So we're happy to say well here's one scenario they have they resolve the fiscal -- and the economy remains growing in healthy -- it's kind of sluggish.
And here's another scenario if in fact we are impacted.
Negatively and we have a loss of revenue from growth money so we're really have and and situation where we will prepare for the best hope for the best.
But anticipate a possibly and negative growth in the economy.
And then and I'm not sure a lot of people know this there is actually what -- -- we're calling the twinkie effective it's a negative bitter twinkie effect because.
There is a hostess plant where you live and in -- -- if it it closed right I mean how many jobs is that going to chop off as far as employment is concerned.
A few hundred and and and clearly any kind of negative constriction of there -- the marketplace impacts us.
Even if it's a neighboring states -- is that -- ripple effect that takes place.
Clearly here at home the good news for us is that work.
Growing -- about a three and a half percent rate now economic we're creating jobs.
And so there -- some absorb -- take place we have a healthy economy and a great quality of life which is attracting people.
And businesses to Utah we're gonna pass significant growth phone now.
But we don't have all all control over what happens in Washington DC and so we're being very cautious as we go forward.
Waiting to see resolution come out of Washington DC.
I saw a quote from something that you said and it was this which I thought was.
Perfect for Washington compromise should not be a dirty word.
Why is it that both sides are acting like if they give in on anything it's a dirty word at -- somehow not going to be reelected the fact is that Americans want -- deal here they want.
They understand I think convey our dear citizens understand that some of that have to come for the revenue side some of it has to come from cuts and spending.
-- I believe so it's -- high stakes poker.
And again there's a lot riskier.
People I think inside the beltway get a little bit my -- -- about what's taking place.
It is republic we ought to represent the people they want us to find solutions.
-- speaking as -- -- -- -- state you know we actually Q we actually have to get things done.
Unfortunately congress doesn't they considered throw rocks at each other end kind of leave -- for another day and kick the can down the road.
Governor is have to get things done today.
We would hope that congress would watch the governor's listen to the states I think we can help them find compromise heaven knows our founding fathers.
Create the most valuable document the history of the world.
Our constitution.
And came out with it by compromise.
Amen that is very true governor thank you so much and he knows folksy ran a small business himself a brokerage governor Gary Herbert it's great to have you on the program -- -- have a great ski season -- you talked.
Thank you as good luck to you to thank you very much at.
