Plenary Session Transcripts

Governors Attending:

Guests:

Discussion Subjects:

• Economic Development and Commerce (EDC) - privacy; and telecommuting
• Human Resources (HR) - state governments taking care of disadvantaged citizens
• Natural Resources (NR) - innovative farm conservation programs on private land; and reclaiming abandoned mines-coal and hardrock
• Other Governors' Sessions - Information Technology Task Force; and New Economy Task Force
• 1999-2000 Chair Utah Gov. Michael Leavitt's Initiative - Strengthening the American States in the New Global Economy
• Plenary Discussion Subject - Community challenges and structural change in the new economy

Points of Interest:

In his final speech to the National Governors Association as President, Bill Clinton compared the state of the nation when he came into office to current conditions. He referred to the enormous deficits, high unemployment, soaring crime, rising welfare rolls, and high health care costs that plagued the country in the early 1990s. Now, he said, the federal government's size had been significantly reduced, welfare rolls were their lowest in more than 30 years, the crime rate had dropped to a 30-year low, crippling increases in Medicare and Medicaid costs had been slowed, and the State Children's Health Insurance Program (SCHIP) had brought about the largest expansion of health care coverage for children since the advent of Medicaid. And while there was now a large budget surplus, the President argued against squandering it on Republican-proposed tax cuts such as the elimination of estate taxes that might ultimately lead to rising interests rates and an economic slowdown, resulting in lower revenues over the long run. While he expressed support for tax reform such as relief of the marriage penalty, he urged that interest savings from debt reduction be focused on social reforms such as incentives for businesses to invest in poor areas of the country, support for Social Security and Medicare, prescription drug benefits for senior citizens, and additional resources for SCHIP.

Colin Powell updated Governors on "America's Promise," which worked closely with both the public and private sectors to help prepare children for a bright future. Powell linked his presentation to the Governors' discussions of states in the new economy by describing some of the projects that America's Promise was undertaking to provide young people with the information technology skills needed to prepare them for the 21^st century.

Ivan Seidenberg of Verizon spoke about how his company—which had been born of the merger of Bell Atlantic and GTE—was working to keep pace with the needs of the new economy. He noted that data traffic had already surpassed voice traffic on communications networks, as a result of which the costs of hardware and data transmission had declined, productivity had increased, and millions of high-paying jobs had been created. Seidenberg argued that to continue the progress that had already been made, government communications regulations needed to be updated to shift their focus from long-distance to data needs. He also urged less oversight and regulation in general in order to spur competition. Seidenberg concluded his presentation by emphasizing the importance of literacy to full participation in the Internet age, and he told governors about the network that Verizon had developed to link all literacy initiatives in the nation.

To describe the new wave of technological advances, Alan Greenspan referred to what economist Joseph Schumpeter had termed "creative destruction": the continuous shift in which emerging technologies push out old ones. He said that in the manufacturing economy, decisions had been based on information that might be hours, days, or even weeks old, which required businesses to keep backup stocks and staff to adjust to inevitable miscalculations and unanticipated changes in demand for products and services. But realtime information in the new world enabled businesses to reduce inventory and dispense with labor. Greenspan acknowledged the insecurities that many workers felt about the potential for job losses and the view that labor displacement caused by innovative production processes threatened our economy's capacity to create jobs. But he expressed the view that technological change spawned opportunities for business to expand, creating new job opportunities. At the same time, Greenspan argued that it was critical for workers to be equipped not simply with technical know-how, but also with the ability to create, analyze, and transform information, and he emphasized that rapid technological changes would require learning to be a lifelong activity.

Greenspan went on to say that with two-thirds of high school graduates enrolling in college now, and an increasing proportion of adult workers seeking retooling opportunities, institutions of higher learning bore an increasingly important responsibility for ensuring that our society was prepared for the demands of rapid economic change. The quality of elementary and secondary education was equally critical in view of the fact that the ability to think abstractly would become ever more important across a broad range of professions.

Greenspan concluded by emphasizing that partnerships must be established among the states, school systems, labor, and industry to develop appropriate standards and guidelines for teaching information technology in the classroom. The problem of teacher shortages needed to be addressed, and a flexible education system must be fostered with a view toward integrating work and training to serve the needs not only of students embarking on their initial courses of study but also of experienced workers at different stages of their careers. Learning on-line would be valuable for states with large rural populations for whom access to traditional classroom learning was more difficult. And particularly important, states with more flexible labor markets, skilled workforces, and a reputation for supporting innovation and entrepreneurship would be prime locations for firms at the cutting edge of technology.

Memorable Quotes:

General Colin Powell said: "It's time to stop building jails and get back to building our kids. The solution to our drug problem is not in the jungles of Columbia, although we have to do something about that. The solution to our drug problem is not interdicting it coming into the country, although we have to do something about that. The solution to our drug problem, the solution to our teenage pregnancy problem, the solution to our youth violence problem is getting into the lives of youngsters early, with their families, with their communities, to give them the character, to give them the competence they need, the character to stay away from these bad influences in their society, the armor of life that will be on them, keep them on the right path.

Alan Greenspan said: "To achieve the most effective outcome from new technologies, we must provide teachers with the necessary training to use them effectively and to provide forums for teachers and education researchers to share ideas and approaches on how best to integrate technology into the curriculum. And we must create partnerships among the states, the school systems, labor and industry to develop appropriate standards and guidelines for the teaching of information technology in the classroom."

Selected Policy Positions Adopted:
(1) Supporting portability of state and local government employees' pensions; (2) recommending that Congress address the long-term funding needs of the nation's ports and waterways; (3) calling on the federal government to ensure that states have adequate telecommunications spectrum to meet their public safety needs; (4) calling for an independent study to review the U.S. Department of Veterans Affairs' service delivery systems and recommend improvements; (5) supporting state efforts to reach effective solutions for combating the methamphetamine trade; (6) calling on Congress and the Administration to explore options for greater funding and administrative flexibility for state child welfare systems; and (7) with respect to Medicaid, opposing "any willing provider" legislation (which would allow any health care provider to participate if it was willing to accept reimbursement rates that other contracting providers had accepted), on the ground that such legislation might undermine state health care reform efforts.

Presidential Addresses: