Jackson Free Press

Thank you. Today I will give my last speech at this Fair as Governor. Marsha, who has had to sit through all but one of them, is being patient enough to sit through this one, too. Not because she is dying to hear it, but because she genuinely appreciates, as do I, the warm hospitality of the people of Neshoba County and the Neshoba County Fair, one of America's great institutions.
For years I've wanted to make a speech at the Fair that was nothing but jokes. And I'm tempted to do that.
My first joke could be the Obama job creation policy. What a joke it is!

How can small businesses create jobs when the administration is demanding the largest tax increase in American history, one that would fall primarily on employers? How do employers decide to hire people when they have no idea what their obligations or costs will be for health care for their employees? The Obama energy policy is to drive up energy costs so people will use less energy. How do higher energy costs allow for job growth?

Yes, the Obama job creation plan is a joke, but it's not very funny; so I think I'll drop the joke idea and talk about Mississippi instead.

You've heard from all the candidates for Governor here at the Fair. There are certainly good people running.
I'd like to visit with you about what my successor will face, come January.

The budget situation is far better than eight years ago but it isn't flush. The so-called Rainy Day Fund contained only $9 million of unallocated reserves when I came in. As of June 30 of next year, budget projections show our unallocated state reserves will be at $285 million, or about six percent of General Fund spending. That General Fund annual spending this fiscal year will be about $4.6 billion; versus $3.6 billion in FY 04, or an increase of about 28% over eight years. State General Fund spending is actually less now than in FY 2008, when it peaked at about $4.9 billion.
Still, spending control will have to be tight, as about $200 million in federal funds available this year won't be available in the next fiscal year. Additionally, we carried forward about $80 million in Medicaid savings from last year that can't be counted on in FY 13.

So the new governor and legislature will need to continue to be conservative next year, and thereafter, if you ask me.

The Obama Administration and the Nancy Pelosi Congress proved the country can't spend itself rich any more than your family can spend itself rich. Well, state government can't either.

We have been reasonably frugal in spending, and we've begun trying to base spending on results.

A good system has been developed to measure the results of spending on our Department of Employment Security workforce training programs. Two years after completing skills training paid for by the state's Workforce Enhancement Training Fund, the average employee earned $7300 more annually than before. That's the kind of result we owe our working people and our taxpayers.
We need to factor in outcomes as we set appropriations for our community colleges and universities. These institutions are critical to our economic growth and job creation; in fact, they're economic development gold mines; but to mine them better, we should look at graduation rates and other metrics of success.

Public school teachers should be paid for performance. Teachers, who get better results out of the same children than other teachers do, should be paid more. We are close to having fair, objective measurements to determine which teachers get those superior results, and they should be compensated for it.
Education is the most important economic development issue and quality of life issue in Mississippi and every other state, so we have to improve the outcomes our school systems produce. We owe it to our children but also to our own future.

Don't, however, confuse how much you spend with the results you get. Some of the lowest spending districts per student get top results, while some that spend the most per student get terrible outcomes. So don't judge the commitment of politicians to education by how much money they want to spend; judge them by the results they demand and achieve for our children.
One good thing: The new governor won't have to pass tort reform to stop lawsuit abuse. That's been done, and it's worked.
Medicaid reforms have resulted in one of the best run Medicaid programs in the country. Our eligibility error rate is one-tenth of one percent, and our Generics First program reduced program costs sixty percent without reducing the quality of care.

Public safety is essential for a good quality of life. Our state law enforcement system is integrated with local authorities, and they provide sheriffs and police with resources and expertise locals don't have. The Mississippi Bureau of Investigation does a great job, and our Bureau of Narcotics was nationally recognized by its peers this year. The year before I was elected Governor, the drug enforcement budget was cut forty-two percent. I appreciate the support the Legislature has given state law enforcement during these last eight years; we have a Highway Patrol Trooper school going on right now.

You should know our Corrections Department was cited as a national model for penal reform last year. Our state's recidivism rate is thirty percent, far below the national average.

While I'm very proud of the results that have been achieved, I'm not the one who deserves the credit. Governing is a team sport, and Mississippi has a great team, from department and agency heads to thousands of dedicated, capable state employees. You saw that after Katrina.

And our Congressional delegation is super: Senator Cochran, Senator Wicker, the House members, including your great Congressman, Gregg Harper.
Let me close by discussing what I consider the most important responsibility facing the new Governor: He must be the chief economic developer of the State.
Government doesn't create jobs; but it establishes a business climate, a tax system, workforce development support, logistical and other infrastructure, and a lot of other things that lead to jobs being created by the private sector.

We need some government employers to provide these functions we've talked about, and some others; but private sector jobs drive prosperity. Government has no money to hire people except what it takes from people and their businesses. Bigger government leads to a smaller private economy or fewer private sector jobs … the jobs on which our economic strength thrives.
Last month Mississippi, according to the U.S. Labor Department, had about 2% fewer jobs than at our peak; yet per capita income was far higher.

Indeed, in the last seven years per capita income for Mississippians had increased by 30.3% or about four and a quarter percent a year. That increase ranks our state fifteenth in the country. It'll go up again this year.

A main goal in job creation through the last seven and a half years has been to replace lower-skilled, lower paying jobs with higher-tech, higher-skilled, higher-paying jobs. That obviously has succeeded.

For decades businesses came to our state looking for strong backs and low wages; now they come looking for strong minds and they're willing to pay for them.

As an example, just yesterday General Electric Aviation announced they will build a new facility near Ellisville. Its 250 employees will do advanced manufacturing with advanced materials … composite jet engine components. It is strongly supported by our research universities and our community colleges.

I vividly remember the news conference held in 2007, when the Vice Chairman of General Electric announced GE would build a plant in North Mississippi to manufacture composite jet engine fan blades and assemblies. He said, "This is the most sophisticated manufacturing General Electric does anywhere in the world," and they chose to do it in Batesville, Mississippi.
Their experience in Batesville is so good that they're building another plant at Ellisville.

Toyota chose Mississippi in 2007, and this fall they will roll out the first Corolla from their plant at Blue Springs, which will employ 2000. At the same time six of their suppliers will be fully operational, employing another 2000.

Nissan, now expanding again, got us into the Southern Automotive Manufacturing Zone, and auto manufacturing has become a huge part of our future.
Likewise with Aerospace, with not only GE Aviation, but EADS' American Eurocopter and Raytheon; Aurora and Stark Aviation; Rolls Royce, Northrup Grumman, and of course, Stennis Space Center with Lockheed Martin and much more.

The last big manufacturing and resources piece of our economic plan is energy. The Fraser Institute in Canada earlier this month named Mississippi the number one jurisdiction in the world to do energy projects. And we have seen billions upon billions of energy capital investment flow into Mississippi these last several years, including Mississippi Power's two-and-a-half billion dollar electric generation plant just over in Kemper County.

The next Governor must and can build on this. Our post-Katrina momentum – and the response of Mississippians to Katrina's devastation did more to improve Mississippi's image, including with job creators, than anything that has happened in my lifetime – we lost some momentum during the recession that we'd built up after Katrina.

But we still have a lot going for us, if we'll have the right attitude – this can-do attitude.

In the last year our deal flow has sped up, and, even though the recovery Wall Street has enjoyed hasn't made it to Main Street, I'm convinced Mississippi can be a leader coming out of the Great Recession.

To do so, we have to believe in ourselves. When this big Canadian think tank ranks us number one, it must remind us: we can be first; we can have the number one container port on the Gulf of Mexico through our plan for the State Port of Gulfport; we can continue to build on our world-class automotive and aerospace industries; we can be the shipbuilding leader – the composite leader – the steel products leader.

We've proven to the world what we can do. Now, let's do it, for our children's and grandchildren's future – a bright future for them in Mississippi.
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