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Indiana Governor Mitch Daniels from the RGA in San Diego

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HH: Joined now by Governor Mitch Daniels of the great state of Indiana. Governor Daniels, welcome to the Hugh Hewitt Show, great to have you on.

MD: Appreciate it.

HH: Now Tim Pawlenty was sitting there an hour ago, and I asked him if he’d like to declare for president today, and he declined. How about you?

MD: Well, I wish he had. He’s a good man.

HH: Okay.

MD: He’d make a good president.

HH: That’s a good diversion, though.

MD: And your ratings would be a little higher. They’re probably going to take a hit after this conversation.

HH: No, but have you got a timetable for this decision?

MD: No, I have a timetable now for what I hope will be a very successful, another very successful round of reforms in Indiana. There’s some things that we would like to do, and the door is now open because of a very successful election. We have conducive majorities in both houses, so I’m thinking only about reforming education, and reforming local and state government, and keeping Indiana in the black without any taxes.

HH: Have you seen the movie Waiting For Superman yet?

MD: Have not seen it. I feel as though I have. I’ve known about it a long time. I’ve read a lot about it. And I’m remiss in not having actually gone to see it. But I’m pretty sure…

HH: So what do you want to do for education?

MD: We want to pay the best teachers more. We want to identify those teachers who aren’t helping students, and either help them to improve, or find a different line of work. We want teachers to earn their tenure, not simply get it by living an extra year. And we want to protect the teachers who get the best student outcomes. We want to free up school boards and superintendents to run their schools the way they see fit. That means repealing some bad state law, or some, let’s say, state mandates anyway, some regulations, and avoiding them getting their hands tied in local contracts. And then finally, we want families to be able to have a much wider range of options for educating their children. We’ve got to take the handcuffs off charter schools in our state, of virtual charters, and empower parents who may not be wealthy.

HH: Is the legislature going to do this for you? Are they going to work with you on this?

MD: I believe they will, and by the way, I hope on a bipartisan basis. The door is open because of an election success, but on the morning after the election. I began meeting with Democratic representatives and senators who we know care about kids, care about reforming local government, and might be willing to help us. Hey, I’ve got another idea that I’m kind of fond of, which is that I discovered, visiting with young people in our state, that an increasing number of them complete, or easily could complete their high school graduation requirements in less than twelve years. So I got this idea and said look, if you finished in eleven years at your own choice, what would you think about we give you the money we were going to spend while you marked time in senior year, as long as you take it and apply it to the high cost of higher education. And we asked Indiana young people about this, and 73…

HH: Ask Indiana parents about that. That’s…

MD: Right you are. 73% of the young people said man, I’d love to have that option.

HH: Because they’re going to be borrowing, too. It’s on their nickel. Most of them are going to be borrowing on their nickel.

MD: Yes, sir. And so the whole idea is let’s liberate the system from end to end.

HH: That’s a great idea. Has that been tried anywhere?

MD: Not that I know of.

HH: Did you think that up?

MD: Well, I’d say some of these young people helped me think it up.

HH: That’s a very good idea. Let me ask you then, Governor Mitch Daniels, about tort reform. I’m asking all of the governors who are outgoing governors. You’ve got a Republican legislature now. You could adopt the English rule. You can do anything you want. What do you want to do?

MD: Well, I think the English rule is an interesting, would be an interesting next step. Indiana’s got a good tort law. It’s one of those reasons we are now at the top of everybody’s lists of good states to do business. You will not be abused in an Indiana courtroom. And our courts have been, as I see it, faithful to their duty on their end. So we’re a very positive state in this regard. But we could be better. And of course, the English rule, which I believe is the rule in most of the world, they should call ours the American rule, I think…

HH: Yeah.

MD: …because we’re the outlier, aren’t we, in the way we do it?

HH: Yes.

MD: And it would be a nice improvement for any of our states.

HH: Anything else on the top of that agenda, because you know, Rick Perry is probably around here trying to grab businesses out of San Diego. Whenever Governor Perry comes to California, he takes a couple of businesses home.

MD: Yeah.

HH: You probably want to do the same thing to my state. So how do you sell Indiana vis-à-vis California?

MD: You know, we don’t have to do it to your state, Hugh. You do it to yourself.

HH: Right.

MD: These are self-inflicted wounds. I mean, we’ve welcomed a number of California businesses. And I always say, I just got back off a plane from Asia, and I always say I like to go to foreign countries and grab up dollars that we usually just spend, and bring them back and put our citizens to work. So Japan, China, California, all kinds of foreign countries.

HH: And so…not California. I would prefer if you did that there. Let me ask you about, I want to put your old OMB hat on. You were a very successful director of OMB for George W. Bush, and before that in the Reagan White House. Right now, this tax hike is looming at us. It’s coming at us like a tidal wave. And Paul Ryan said on Hannity the other night, and we love Paul Ryan, but he said we’ll take a two or three year extension of the existing tax rates. What do you think of that policy? What ought to be the policy of the Republicans going into this negotiation?

MD: Those are two different questions. I mean, first of all, I trust Paul Ryan. He’s one of the best assets the country’s got now. And he and I think alike about a lot of things. I mean, the right policy, of course, would be certainty, permanence, predictability. This is always the case in tax policy. A lot of businesses say they can live with a sub-optimal tax system as long as they know what the rules will be. You know, in Indiana, we passed the biggest tax cut in state history, and we cut property taxes, which are now the lowest in America. But maybe the more important thing that we did was we, and we just made this part of our constitution two weeks ago, we put those caps, there’s a cap now at 1% on the value of your house, 2% on your farm or rental property, 3% your business, permanently. It can be lower than that, but it can never be above it. And a lot of businesses say that it’s the certainty of that that’s as important to them as the fact that the rates are low. And the same would apply, I think, to federal policy. But look, if Paul Ryan and other folks down there who know that think that let’s get the best deal we can now and fight another day, I’d defer to their tactical judgment.

HH: Let me switch up on you on a policy area over to the New York City verdict yesterday, in which a terrorist is going to go to jail for 20 years to life, but walks, is acquitted on all these other things. Your reaction to that verdict?

MD: You know, I probably know less about it than most Americans. I was somewhere over the Pacific Ocean, I guess, when it came out. And I’ve only just read the sketchy reports. Maybe I shouldn’t have been, but I was stunned at the whole notion. And you know, I guess I read it as another sign of a lack of seriousness about the survival level threat that this poses to our country. And for the first time in my life, I see two dangers that rise to that level. I try to avoid hyperbole and exaggeration. But you know, the debt we’re facing, the thing that has Paul Ryan’s full attention, and the threat from people in a WMD world who have proven that they will stop at nothing, and the more Americans they kill the better. We have to take these things with dead seriousness. And once again, I think we’ve shown something less than that.

HH: Okay, I’ve got two more…A) I’ve got to ask you a political question. Reagan Library, Nancy Reagan, great American, obviously, you worked for her and her husband as I did. And now she wanted to have the Reagan Library host the first GOP debate among would-be presidential candidates. You might be one of those. And they want to do it in the spring of 2011. Is that too early? And if it’s not, or if it is, and whenever you want to hold it, or suggest it be held, should NBC and Politico get to ask to the questions?

MD: Well, it would be too early for me, I’ll tell you that both as someone who might think about it, but just also as a citizen. One thing I like about the way this round is unfolded is that it’s not started two and a half years early. People aren’t camped out all over Iowa and New Hampshire. And I’d love it if we sort of wrote a new rule book and give the American people a little respite for goodness sake. So it does strike me as…

HH: What about those media partners, though?

MD: Yeah…

HH: Should Republicans’ nominee be mediated by mainstream media?

MD: Oh, you know, first of all, they’ve got a right, and they’ll exercise it over and over again to interrogate people. And anybody who’s going to be our standard-bearer better be good at handling those folks. So I guess if that’s the way the thing is set up, you’d prefer a little more balance in the panel. But you know, I happen to believe that the case for change, I mean real change this time, from the current policies, and we have a very, very strong, I don’t care who asks the questions, I think that we have the better answers for America. And people might as well get some batting practice responding to folks who don’t agree.

HH: Do you read widely on the left? Do you try and stay abreast of what…

MD: I do. You know, it’s often observed these days that the proliferation of channels and blogs and all these other things can lead some folks to sort of zoom in on the people they agree with, and not remain either open to other ideas, or even aware. And so I do make an effort.

HH: Is anyone making an argument out there that persuades you they have anything left in their intellectual arsenal regarding the spending and the tax policy?

MD: No. And by the way, I don’t consider this particularly an ideological question anymore. I say to folks at home all the time, Hugh, if they bring up national issues like this.

HH: 30 seconds.

MD: I say you know, let’s have the philosophical debate tomorrow. I happen to believe in very limited government, and you may or may not. But can we just agree about the arithmetic of this? This country is going to go broke in a way that will hurt everybody – left, right, and every other description. And so let’s get together and work on that, and we’ll, we can have our ideological arguments after we’ve done it.

HH: Governor Mitch Daniels of Indiana, a pleasure to meet you, come back early and often. Great to have you here.

MD: I’d love to.

HH: Thank you.

End of interview.


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