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Well it is a tale of two states one.
Facing nearly eleven billion dollars in budget deficits forcing its new governor to take draconian fiscal measures the other.
What about 330 million dollars in the bank in savings and a state unemployment rate of seven point 3% well below the national average.
What did New Jersey do wrong and what did Montana do right former Governor Christie Todd Whitman led New Jersey from 1994 to 2001 -- and democratic governor Brian Schweitzer currently represents the state of Montana we will speak to governor Schweitzer just a moment but first.
The governor Whitman and the mess in New Jersey you of course governor Whitman oversaw much of that state for several years and looking that was that anything that you would have done differently to prevent it from falling into the morass that it has now found itself.
Well no actually if you look at the record when I left we had a billion to -- surplus.
We had bad jobs were coming back -- unemployment rate was way down we have balanced budget we had at what happened was after I left.
We saw the -- deficit.
More than double from fifteen billion to 35 point six billion.
We saw spending that occurred in those years.
In only eight years after I left before Chris Christie came in for every one private sector job that was created they were fifteen public sector jobs created in the state of New Jersey.
And also during that time there were steps after I left office -- -- steps taken to increase the pension eligibility.
Reduce the age of retirement eligibility from sixty to 55.
Sweeten the pensions and you saw this growth in government so it's been really a case of overspending.
And over promising we have very very good retirement packages and that really is what drives the budget analysts -- also been over regulating and over taxing the good the regulations increase the taxation increased to an extent that a lot of people I know moved out of Florida we've got to -- -- moving all the time I mean as you remember when I was governor ran on cutting taxes and -- cut taxes over forty times during those seven years.
After that you -- -- -- start to go back up again because people were spending.
And knowing and that the thing about it is you can't cut taxes in a vacuum you've got to control spending.
The minute you stop controlling spending.
You start to see you gotta pay for it somehow and the easy answer is to look for taxes -- -- -- think Chris Christie is doing.
I think he's doing very very well -- -- he's taking on what he's got to take on 17%.
Send your budget is discretionary that's it the rest is all formula driven that's all those pensions it's all the contracts you -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- The the middle class is gonna get socked with the cuts get -- the wealthy under Chris Christie.
I don't think that's true at all from what I have seen of Chris in the -- trying to -- -- first of all understand that a lot of those wealthy people are the ones -- create jobs.
And you -- and that's who's been moving actually if you look they've been studies out done in the last month to their -- on the amount of high income people who have left the state of New Jersey in the last.
Three years and the amount of money they have taken with them with that move.
Money that they gave to charity money they invested in businesses I mean this hurts so to say that you only want to -- you.
You have to go after -- wealthy.
Is actually counterproductive in a way you've got to balance it so that your ensure that you minimize that the damage and that and the hurt to the middle class.
But you don't want to drive everybody of -- -- the -- out of the state or you lose a big part of a year tax revenue and your ability create jobs.
Governor Christie Todd Whitman great to -- -- pleasure being here appreciate it let's turn now to governor Brian Schweitzer.
He is a Democrat of Montana -- unbelievable.
That in this state of affairs that we find the country and that Montana has about 330.
Million dollars right now in the -- you guys have been doing terrific.
You often say that were running the state like a ranch what you mean by that.
Well three and four years ago all the states were washing cash.
Christie was actually talking about a time from 94 to 2001.
Which were really pretty good times as well.
But if you ask.
Any state 34 years ago how you're doing all they had lots of money.
And so most of those states they committed that money -- ongoing programs not Montana.
We stopped bonding we said we're not gonna borrow any more money if we want to buy something will pay cash on the barrel head.
And we said we're gonna build a savings account.
Because we know run of the states just like running a ranch you don't always have good years and we don't know when those bad years are gonna come we don't know what it's not -- -- and when the price are gonna go down.
But when it comes if you've got money in the -- -- gonna make it through so not only do we have 330 million dollars in the bank.
We have a rainy day account with more than 800 million dollars in that -- we have a one point eight billion dollar budget.
So we have not only money in the bank but we filled up all of our coffee cans we have a little money under the -- -- Well you're hiding it I love that and and week we brought you on because -- -- such a model of fiscal planning an -- austerity dare we say it.
If you could say the one that.
Best move that you made during the past couple of years.
That really helped you see through this what would that be is it that you -- put that rainy day -- together when times were so good and is that what we all need to be doing from now law.
Well that's part of it but it's also incremental -- It is it is nibbling around the edges because all of those people are watching you know time and money.
And if you make our savings move four years ago it compounds for four more years and so idiot idiot number that you can challenge.
We decrease the number of parts of the state of Montana has we just sold in the we didn't replace him.
When people -- we didn't -- hire people because with technology you ought to be able to travel through the Internet you don't need to be in the car.
And with technology -- to decrease the number of employees.
These states who are using a lot of computers and and using technology and yet increasing a number of employees increasing amount of travel.
Well that's that's just silly if you're going to use technology if you're going to be competitive with the world.
You've got to use technology and -- governor Schweitzer won -- nobody anybody who's.
What about the obligation as we we we're talking -- Christie Todd Whitman about that many obligations here for the union funds the pension funds for the government workers of course California's having this problem as well.
Most of the states -- in real dramatic crisis have a problem of these past obligations how do you deal with that.
Well look in in the federal budget.
If they're not talking about Social Security Medicare Medicaid and defense then they're just lying to you.
When you're talking about State's 85% of all of our budgets we're just fifty different franchises we educate we medicate.
We incarcerate 85%.
Of every State's budget is in those three areas -- they're not telling you how they can save money in those areas.
Then it's just like a federal.
Congressman saying well we're gonna cut -- -- and that's how we're going to save.
The the money -- all the money actually is the social security and and Medicare Medicaid and defense in the case of Montana.
We know that we have an obligation to our state employees will retire.
If you start moving now if you recognize you're not likely to get an 8% return in the market every single year if you -- your state employees.
Your compensate rate compensation rate will go up by 1% arsenal go down by 1%.
Thirty years from now when they retire you can make that system hole but the longer you wait.
The bigger problem to have.
Montana democratic governor Brian Schweitzer we thank you and of course Christie talk with the.
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