Debate transcript

Q: Mr. Gabrieli, Massachusetts is currently ranked 45th in the nation for job growth. What do you know about creating jobs on a mass scale? We know you've never held elective office. We know you are a businessman and you have created jobs in that capacity, but Mitt Romney is also a businessman, and the state is still down about 155,00 jobs from pre-recession levels. What specific innovative proposals do you have to create jobs?

GABRIELI: Well, I do feel I have some relevant background in this area, having started my own company from scratch, built it into a sizable company with my partners, helped other people start literally hundreds of companies. And those companies today have literally created more than 100,000 jobs across this country, tens of thousands of them here in Massachusetts, in just the kind of industries that we excel in, in high tech and biotech, the industries of the 21st century. So I feel pretty confident on this topic. We have to invest to create jobs in Massachusetts . I proposed, for example, last week, that we put, over a decade, a billion dollars, at $100 million a year, out of bonding, into the technology, stem cell research for example, renewable energy. Things that will create the jobs and industries of the future. By making those investments, we build on our greatest assets, our ability to innovate, we keep those industries here, and we avoid letting California and other states steal our future.

Q: Do you believe the governor actually has significant control over job creation, or is it more tied to the whims of the economy?

GABRIELI: Well, the private sector certainly creates those jobs. That's in my experience, exactly in that, but there is an opportunity for state government to play an important role by investing, for example. Why do we need to invest in stem cell research, for example? Because the federal government, George Bush's ideology, won't support this critical area. And if it doesn't happen here, the $3 billion in California, the billion in New York, we will see that industry sucked out away from here.

Q: Mr. Mihos, there's every expectation that a commission created by the legislature will report later this year that the state can not meet its transportation needs without additional revenue. You have opposed increasing the totals on the Mass Pike. As governor, where would you find the money to repair the state's roads and bridges, and to build up its commuter rail and mass transit systems?

MIHOS: Ken, I absolutely oppose any increases in the tolls, especially on the Massachusetts Turnpike. In fact, when I'm governor, I'm going to take them down. Certainly the money is in Beacon Hill. This state does not have a revenue problem at all. For the last two years, we've had a budget surplus of over a billion dollars each year. The rainy day fund has $1.7 billion in it, and all the three major think tanks in the city are now talking over the next three years a billion dollar budget surplus each and every year. The state has all the money it needs What it doesn't need, what it doesn't need is for all the special interests to rally around that part of money and look to take it away from where it should be going, the cities and towns. I don't believe the state is in as bad a condition as people are talking, certainly. The Turnpike is in great condition. A lot of -- The Department of Highway has done a wonderful job in many of the roads. I just don't believe what they're going to come out with, that we have to go willy-nilly with a huge transportation expenditure at this point.

Q: Does that suggest that you would use the entire surplus for transportation, or do you have other plans for that?

MIHOS: No, no, no. The surplus has to go back into local aid, go back into cities and towns. This Romney/Healey administration has starved the cities and towns over the last three years. They've cut local aid by $700 million each and every year, and at the same time they've raised fees, fines and taxes over $850 million since 2003. At the same time, they've put all the burden on the homeowner and the business property owner, certainly, and that's why people are leaving this state.

Q: Mr. Patrick, my question has to do with housing. In an attempt to increase production of modest-priced homes, the state has offered new financial incentives for housing development in existing city and town centers and near public transportation. But these measures are voluntary, and to date, not a single community has adopted them. If state incentives prove insufficient, what would you do to overcome local resistance to new housing?

PATRICK: Well, first of all, Bob, I think this is an issue of real urgency. We are the only state in the nation to have lost population in each of the last two years, most of them young, well-educated, well-prepared, and the number one cited reason for those folks leaving is the high cost of housing. I don't have a magic bullet here, but I do think there are two strategies that help. One is supply. Frankly, developers find it hard to get going here, to make it through the long and circuitous and uncertain approval processes. The legislature just yesterday took some steps to streamline regulation. I think that's a part of it, but we also need to enable cities and towns to deal with the impact of those new families on their communities by increasing local aid so that they have a way to cope with the impact of those families on the schools, on the infrastructure generally.

I think the other strategy is public transportation. We've got to invest in public transportation. And the way to – it seems to me that if you, for example, live or work in the general – the greater Boston area, and you can get a fast train to New Bedford at the end of the day, it's a different housing market, it's a chance, it's a way to get started. So those two strategies, I think, come together.

Q: Now, you say that we need to give more local aid to cities and towns, and you said that in lieu of a cut in the income tax rate. Should additional aid be made contingent on local efforts to develop modest priced housing?

PATRICK: I think it ought to be conditioned on better planning generally. Not just around housing. That's an important part of it. But we don't plan very well in Massachusetts, in terms of our economic and business development, in terms of our housing, in terms of our public transportation. I talked about this today when I was with the mayors out in the western part of the state. I would condition that return of local aid, substantial return of local aid, on better regional and statewide planning.

Q: Attorney General, a tax question. You've switched positions and now favor rolling back the state income tax from 5% even – to 5% even from its present 5.3%. The move will save the average family roughly $200 a year, which is your figure, or about $4 a week. But it'll cost the state an estimated $700 million by some estimates, making it a challenge, arguably, to fund the big healthcare refund program, increasing local aid to greatly stressed cities and towns, restoring funds cut to public higher education. Can you tell us tonight which of those you're willing to short fund in order to save taxpayers 4 bucks a week?

REILLY: Well, first of all, Bob, I think it's absolutely remarkable that Kerry Healey is not here to defend the dreadful record of this administration over the last four years. Absolutely dreadful. Lost jobs, lost population. We're going in the wrong direction. In terms of your tax question, I believe that taxes are too high in Massachusetts, and I'm not just talking about property taxes. I am also talking about the income tax and all the other tax burdens on people. People are hurting here in Massachusetts right now. We don't have a deficit right now here in Massachusetts. We have extra revenues, and the next governor will have at least $800 million in excess revenues, $500 million after the tax rebate. I also believe that there are savings to be had in government, and I think some of my colleagues agree with that as well. But the best way and most solid way is to grow this economy, create revenue and get Massachusetts moving again.

Q: You've said, quote, voters have made it very clear in Massachusetts they want their income tax rolled back. They delivered that message in the year 2000 in a ballot question. Considering you only just embraced the rollback, it apparently took five plus years for you to understand that that message was very clear. Isn't this just election (inaudible), that the tax cut carrot at election time --

REILLY: Absolutely not. We were in a period with tremendous deficits that we were facing, not just the governor, but the legislature as well. So that wasn't the time. We're not in that period now. We've had two straight years of surpluses and extra revenue, and I believe that extra revenue -- $200 may not seem much to people, but I think it's a lot to people when they're getting hit with higher gasoline at the pump, higher tuition bills, and a whole range of demands on their money. This is the right time. If we're not going to do it now, we're not going to do it at all.

Q: Mr. Gabrieli, for tonight, everyone's talking about this apparent exodus from Massachusetts and what it means for the state. One aspect of this puzzling phenomenon that we haven't talked about very much is that that population loss would be much greater were it not for this influx of new immigrants, many of whom come with limited training, limited education. What would you do to prepare these workers specifically for the work force?

GABRIELI: I think that's an important issue. We have a large legal immigrant population in Massachusetts , and in some of the hot button discussions, we lose sight of that. And as someone who's been involved with MassInc in the past – not on the board now, would be a conflict of interest – but I think their leadership in setting out to people in Massachusetts, the fact that our state has been the most dependent state in America for growth in its work force from legal immigrants is a crucial fact. What do we do to embrace these immigrants and help them succeed? First off, give them the English as a Second Language that they need. There are waiting lists in our major cities and in other communities for people who are willing to work a tough job during the day, go to school at night. My hat's off to them. I've met with people who do that. Why is there a waiting list? It's small money. They get better jobs, they're better parents able to help their kids with their homework, better citizens. It's an embarrassment that in a state like this we don't give them those sets of opportunities.

More broadly, I think anything we do to continue to create economic growth and opportunities and jobs is how we let those people succeed, as my parents, who were immigrants to this country, did.

Q: Would you devote – specifically, would you devote state money to those programs? Would you – is it worth the investment, in your mind, to make sure those people are trained?

GABRIELI: Absolutely. For what is short dollars. The data on this is very compelling, what the return is, because when a person who has fairly high skills but doesn't speak English well tries to get a job, they really get a job related to their poor English. As soon as their English is good enough that they can show their real skills underneath, they jump up in their earnings. So we get paid back very fast as a state in the income taxes on that, and equally, more importantly, we give people that real meaning of opportunity for all. So it would be one of my highest priorities as governor.

Q: Mr. Mihos –

MIHOS: Christy.

Q: Christy. We all know gas prices have reached an all-time high in recent weeks. Lieutenant Governor Kerry Healey has proposed waving the state gas tax for the summer, which she says would obviously save Massachusetts drivers some money. You happen to own a chain of stores that sell gas. Do you support Healey's proposal, and if so –

(inaudible)

MIHOS: Well, I talked about this last year when gas went over $2 a gallon at the time, and was looking for some type of relief, certainly. The people that are out there, that visit my stores each and every day, I get a worm's eye view of what's happening certainly in the Commonwealth. And right now I can absolutely tell you that people are hurting because they're buying just enough gas to get to work and to get home. And then they go out and they're buying lottery tickets to try and absolutely waylay all of their bills that they have, certainly. So we are in tough, tough shape. But I do propose any type of help we can give people, day in and day out. Gasoline at $3 a gallon is anathema to where I come from, never should happen , and any type of relief for the beleaguered Massachusetts motorist is something that I certainly would favor in the short term.

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Q: So what do you think of the idea that really the only – we're sort of, in effect, encouraging people to drive their cars by taking that tax away, at a time when you could argue prices need to go sky high in order for something really to happen.

MIHOS: Yeah. Well, the fact of the matter is, people have got to get to work, and they've got to get home each and every day. And if you were to ask me what I would do, back in the late 70s, Jimmy Carter had proposed an energy czar, James Schlessinger (sp?). Nothing much has happened to the United States energy policy since then, other than the fact we've gone from about 19 oil companies to five oil companies. It's time to get some competition in and break up the oil companies again. That's really -- we've done it before. It's time to do it again.

Q: Mr. Patrick, this would be a little bit of a follow-up to Bob's question in the first round. You talked about the approval process that business have to go through, and that certainly is true. The state also has a strong reputation for protecting open space and the environment and keeping downtowns on a human scale. So how far would you go in streamlining the business approval process as you consider this quality of living environment the state's residents seem to appreciate?

PATRICK: Ken, it's an important question and it's important to see the importance of balance in this. I mean, we have wonderful open spaces here in Massachusetts, and we have, over time and through a lot of work, cultivated a village-like approach in many of our cities and towns. This idea of transit-oriented growth or smart growth, it's a Romney administration concept. It's a great idea. Problem is, there's not a lot of execution in this administration. We need to execute against that idea. And I think we need to be really careful not to fall into this false choice, that we can either have adequate investment in housing starts, meaning particularly multi-family, clustered rental units. That's what we really need. And we can have that, or we can have environmental stewardship. I think there is a balance that government is about, and that we can find and must find.

Q: Does this question also come up when it comes to business who want to expand?

PATRICK: You bet.

Q: How would you handle that?

PATRICK: You bet. When I was at Coke, for example, we were – Coke does business in more countries than there are members of the United Nations, so we were dealing with regulatory approval processes all over the world, in all kinds of settings. And there are lots of places where you go where you are taken by the hand, and walked through the regulatory process, one-stop shopping. It's a very simple, practical approach. It's something we can do here in Massachusetts. We have to get across that we are open for and welcome to business. And we can do that, it seems to me, without sacrificing our interest in environmental stewardship on human and community impacts.

Q: Attorney General, considering the heavy loss of jobs in the last recession, many people believe that job growth needs to be the top priority of the next governor. The other candidates on stage with you have substantial experience in the private sector. What do you, a career public servant, have to offer when it comes to the challenge of job growth?

REILLY: Well, first of all, I've saved a lot of jobs in Massachusetts, stepping in to when six years ago, Harvard Pilgrim was going under. Thousands of jobs in jeopardy. I stepped in, put that company into receivership. They owed $350 million worth of debt. One million members were in danger of losing their health insurance. Not one person was denied care. Everyone that was owed that money got paid. So I've made a difference in the ripple effect of that throughout the economy. Would it (inaudible), we'd still be feeling it.

In terms of job growth, we have to do something about the cost of business here. I spent a lot of time in healthcare. We have to make healthcare more affordable. And we have to cut down the endless red tape that is just driving businesses crazy and driving them over the borders to other states. But I'll tell you what I'll be. I'll be a cheerleader and I'll be fighting for Massachusetts every day. Other governors are fighting for their states and fighting for jobs. We haven't had that in the last four years. When I'm governor, I'll be fighting these states and I'll be fighting to keep these businesses right here in Massachusetts.

Q: You mentioned healthcare. How do we hold down healthcare costs? We've just gone through a massive healthcare reform bill on Beacon Hill, offering opportunities for coverage that have never been there before. What did that measure do, or what do you propose that would actually restrain the cost of that healthcare?

REILLY: I've taken on the tough fights throughout my career, particularly as Attorney General We have to deal with the problem of making it more affordable, and that means dealing with costs. It means administrative costs. One-third of the amount of money that is spent on healthcare is spent on endless series of forms going back and forth, and doctors spending one-third of their time filling out paperwork rather than treating their patients. Better use of information technology, better prevention, emphasis on prevention, better disease management. There are billions of dollars to be saved in this system. We keep it in the system, we'll cover everybody in this state.

Q: Mr. Gabrieli, the question's about your stem cell plan. You're floating a one billion dollar plan to raise money to encourage stem cell and life science research in Massachusetts by selling bonds with the idea of helping to make sure Massachusetts stays or becomes a leader in those fields. But some say it's almost always a waste of money for government to be spending money like this because government is always a day late. By the time it makes decisions, it ends up throwing money on yesterday's cutting-edge technologies. So, respond to that if you would.

GABRIELI: Oh, absolutely. I'm pretty passionate on this topic. There are 300,000 people in Massachusetts with diabetes. Stem cell research holds out the highest hope for cures for those diseases. Now, I really do get upset when I think about George Bush, Mitt Romney saying, for their personal ideology, they've cut off funding on the one hand. And Romney was going to make it a felony to do that research in Massachusetts on the other hand. That's wrong. It's outrageous. We don't know whether we're going to cure these diseases for sure, but it is just the wrong thing to do to block it.

And when it comes to jobs, by investing in these areas, first off, we create jobs in the very process of doing the research, of building up the facilities. That's the first set of jobs we get out of it. But more importantly, this is the cutting edge of life science research. There is a reason why the researchers are hungry to get at this. They don't have the federal funding to do it. There's a gap in funding as a result of that. National Institute of Health and National Science Foundation research money is what has created the entire boom in life sciences. It's cut off because of Bush. That's why state governments need to step in. If the federal government comes back, fine.

Q: But again, how do you make sure that the money's not wasted –

MOD: You've had your follow-up.

Q: No, this is my follow-up. Again, how do you make sure the money's not wasted, and how do you avoid California's problems with its stem cell initiative? There are complaints about lack of oversight, ethical fights. And in California, the plan has been held up in court because of Conservative opposition.

GABRIELI: We have in this country a 50-plus year history of outstanding ways of doing peer review to make sure that the projects proposed are good ones. This is a state full of people who know a lot, both about the basic science and about how you turn it into technology. I take someone like a professor here at Harvard who I know who's won the Nobel Prize and started our biggest biotech company. I'd ask people like that to serve on a board to make the choices for us. And by the way, if by the time it comes around, they don't think stem cells is the right place to go, great. Let's invest in other science and technology that will lead to the big industries and jobs of the 21 st century.

Q: Mr. Mihos, Christy. You have a provocative idea to freeze homeowners' property assessments at the moment they bought their home, in an effort to keep their property bills from going up. That might provide relief to existing homeowners, but wouldn't it be unfair to new homebuyers at a time when Massachusetts is struggling to recruit and retain its young families, and wouldn't it also deprive local communities of revenue for schools, police and other services?

MIHOS: No.

Q: Why not?

(laughter)

MIHOS: That's just one part of it, certainly, about freezing, or capping assessments on residential properties and business properties. The other part, certainly, is that I would take local aid from less than 30% and take it to 40%. The Mass Taxpayers Foundation came up with this plan. They want to do it over a number of years. I say the cities and towns can't wait. They need to get their local aid back so that they can provide the services, stop firing teachers, stop closing schools, start providing services. And the third part of that is that no public school child should have to be paying for busing or for any extracurricular activities while they're going to school. They should be kids first, and participate in everything I did while I was at Brockton Public Schools.

Q: But if you bought your home 20 years ago, you're paying the assessed value of that, and your neighbor moves into maybe a lesser house next door, and they're paying on today's assessment, you're paying vastly different amounts on your property tax bill, and you have the same house. Is that fair? Does that encourage people to move into neighborhoods?

MIHOS: Well, it's certainly fair to the elderly people and the middle class and all who are leaving the Commonwealth, leaving their homes right now because they can't afford these huge, huge warp-like increases in property taxes each – every second and third year, certainly. And they've moved into those homes certainly on their own personal volition. They've chosen to be in an area, in a community with good roots, good services, where people want to stay. So, no, it isn't unfair. No.

Q: Mr. Patrick, you have said that you have no intention of raising taxes. Yet, on several occasions, you've said that you would support raising taxes. You supported a hike in the cigarette tax to subsidize healthcare. You support a local meals tax, and you have said if you had to raise taxes, you'd consider the gas tax or other possible sin taxes. How do you explain this inconsistency?

PATRICK: Well, thanks for the question. The question has usually come in the context of the income tax, and what I've said is that I think at 5.3%, where it is right now, that's what we need and need to live within in order to restore local aid, and to begin to fund so many of the services people say they want which have been so drastically cut. There are other techniques. The issue of the cigarette or sin taxes was one of the ways that was proposed when the legislature was first thinking about how to fund healthcare , something we still don't know the total cost of. The question of gas tax, for example, and whether we can cut that, even if it's legal. I mean, my issue is how we get past gimmicks as a way to govern, and how we get to the root causes of some of the challenges we're facing and how we fund them in ways that are transparent and efficient. I don't think it's a good idea to even put the question of the income tax on the table, frankly – or, increasing it – frankly, because people don't have trust in their government. and if you look at something like the Big Dig where we've spent billions of dollars over the original cost, and the breathtaking lack of curiosity among our elected officials about where that money went, then it's small wonder that people aren't interested in an appeal for higher taxes.

Q: But isn't it somewhat disingenuous to say you have absolutely no intention of raising taxes?

PATRICK: I have no plan to raise taxes. I have no plan to raise the income tax. I have no plan to raise the cigarette tax. I was interested in that proposal, when that was one of the features for funding the healthcare plan. That's off the table now.

Q: Mr. Attorney General, you have an energy plan that you propose with the stated goal of reducing the cost of energy for families and businesses. I'm trying to figure out how that's going to happen. It's hard to see it happening without additional energy supplies, including LNG plants, electric generating plans, and renewable energy sources. But LNG terminals run into trouble wherever anybody proposes them. Energy producers seem to have no incentive to build more power plants, and you yourself have opposed the wind farm proposed for Nantucket Sound. So how do you propose to meet the energy needs of the Commonwealth?

REILLY: Well, first of all – and let me go to the last part of your question in terms of the wind farm and Nantucket Sound. That is a huge rip-off. 24 square miles of Nantucket Sound are going to be given – are proposed to be given to a private developer for absolutely nothing. With hundreds of millions, perhaps up to a billion, dollars in tax credit, they're going to go to that developer and those investors. And it's being sold that the electricity will provide the electricity for Cape Cod and the island. That's nonsense. That electricity could go anywhere in New England. So you start with there. There is a place. We do need to increase the supply of LNG. There has to be proper siting. You don't do it in Fall River, in close proximity, across the street here, to a residential area. You don't do it. You site that in appropriate places that are far removed, and the Homeland Security even has stated, they should not be near residential areas. And then have a meaningful role for the state. We do that, and we'll move forward.

Q: So do you have a proper place for an LNG plant in the Commonwealth in mind?

REILLY: Somewhere that is not in close proximity – there are a number of areas that are being discussed. And bear in mind, Ken, this doesn't have to be in Massachusetts. It can be anywhere in New England, OK, where we can increase the supply. And quite frankly, rather than being in Boston Harbor, in close proximity to New Bedford, I'd entertain some offers from some other states. But we can do this. We can site them, site them properly, with proper input from the cities and the state of Massachusetts. We'll get this done.

SAHL: We're still cleaning up from a 100-year flood in Massachusetts this week. Homes and businesses heavily damaged. Certainly there will be federal money that will be coming in, but nobody believes at this point that those federal dollars will fix what has happened this week. What is the proper role of the state, where does the money come from, and what would you do as governor? Tom Reilly, you've been in state government for a long time. We'll start with you.

REILLY: First of all, this is where experience kicks in, OK? And I've had experience, not dealing with floods, but in emergency situations throughout Massachusetts. The first thing the governor does is what this governor did. He went to the area. The second thing, do an assessment. The third thing he does is access federal funds. Now, if there's any drop-off – these are our fellow citizens, and there's been devastation in Merrimack Valley and parts of the North Shore. The state has to step in and help those businesses and help those homeowners get back on their feet.

SAHL: Grants, loans, supplemental budget? Where is it going to come from?

REILLY: Whatever it's going to take. Whatever it's going to take to get them back on their feet. We're all in this together, and when that happens to our fellow citizens, we have to step in. Obviously, we want as much help as we can get from the federal government. Then we have to make up that gap and get people back on their feet and do it quickly.

SAHL: After all those rainy days, would you tap the rainy day fund?

PATRICK: That's what it's called.

SAHL: Would you tap it?

REILLY: We have $500 million, more than that, in terms of extra revenue that we can use –

SAHL: Would you give up the income tax rollback to help the people in Haverhill?

REILLY: Right now, I think there's sufficient revenues. It's all a question of priorities, and how you spend your money. I think taxes are too high, and that's my position.

SAHL: Would you give up the tax rollback? Anybody else jump in here.

REILLY: There is money available to make up any shortfall for the federal funds that won't make up those losses, and I'll fight for that.

PATRICK: Part of the response is about emergency response. It is about showing up. It is about showing leadership. When I was at the Justice Department, I managed what was, before 9/11, the largest criminal investigation in American history. It was the response to the attacks on black churches and synagogues in the South. And that meant pulling together the federal prosecutors, the FBI, the ATF, FEMA, HUD, HHS, all these agencies that had a reputation for never working together – and they were proud of that reputation, by the way – and getting results. So I understand how to get the most out of government.

But there is also, it seems to me, a responsibility in leadership to think about and plan around root causes. And part of the problem is that we have not been investing in our infrastructure. There are dams failing that ought not fail, because we haven't done the maintenance. And part of the reason we don't do the maintenance is because we've been starving cities and towns and our infrastructure generally. That is why it is imprudent for us today to roll back the income tax, because we can't afford to invest in cities and towns and roll back the income tax at the same time. It's just --

SAHL: Same question. Would you tap the Rainy Day Fund?

PATRICK: If necessary, yes. I would tap any source necessary in order to not just respond to the emergency, but to prepare ourselves against future emergencies.

SAHL: Chris Gabrieli.

GABRIELI: Well, I think the first thing I wouldn't do, I think, is showboat for national cameras and say I was going to prevent looting on theNorth Shore. I thought that was personally embarrassing, and anybody who doesn't know what I mean, that's what our governor did. And I just thought that was – I know a lot of those communities, I've spent a lot of time there. I don't think that was a risk, and neither did any of the mayors. In fact, I don't even think the State Police thought it was. But I absolutely agree with Deval, that the – last year we saw the dams weren't being inspected. What happened to the dam inspectors? We saw scaffolding collapse. What happened to the scaffolding inspections? There is a long-term price that we see when these crises come around. You can't anticipate everything, but there's been a knowledge for a while that we've got a problem in Peabody. And that was – there was a debate about what to do about it, there's some finger-pointing going on. There's been a lack of leadership, and part of it is, this administration says, it's great when we oppose the legislature. When we fight the legislature, that makes our state stronger. Well, as a matter of fact, the money to deal with some of the challenges in Peabody that might have helped reduce at least some of this damage, got into that scrum, and the result is finger-pointing, not improved infrastructure that would have prevented at least some of the damage in Peabody. So, leadership –

SAHL: It's a given you all have good intentions. Where does the money come from for this to happen?

GABRIELI: My impression is, there's plenty of room for emergency funding in that, but the scale of this is –

SAHL: State money.

GABRIELI: Yeah, state money. My impression is, there's plenty of money for emergency situations, as for example, when you have variable snowfall every year, there's money available to deal with that. They do it through supplemental budgets and so forth. So I don't think this is chiefly – honestly, it doesn't have the scale to be a budget-buster in a $25 billion budget. And as you mentioned, with $2 billion in the Rainy Day Fund. But I think the issue that we're all hitting on here, I think, is this is a prevention issue. This is a lack of leadership issue, that – leadership that thinks you show up and make a big statement to the cameras, not do the hard work year in, year out to prevent those, is what we've suffered from.

SAHL: Christy Mihos, what would you do as governor to help those folks in Lawrence, Haverhill?

MIHOS: Well, I would do exactly what Mitt Romney is doing right now. He's looking to FEMA and MEMA. This state stepped up big time when Katrina went down and those people down south needed some real help. Massachusetts was there. I do believe – I take the Governor at his word. He's going to work closely with the Bush administration and with federal authorities to get us federal funds. If I were in his place, I would do the same thing.

SAHL: Deval?

PATRICK: I would just add that I do think it's a good thing that the governor was able to find the compassion and the resources to shelter, feed, and clothe evacuees from New Orleans. That's a good thing. But it is shocking that he has been unwilling and unable to find the compassion and the resources to shelter, feed and clothe people who are flat on their backs right here in Massachusetts, day after day, year after year. And that is something that I intend to turn around when I'm governor.

SAHL: All right. Let's move on. I want to come back to the subject of job creation. The numbers show that job creation in Massachusetts is very Boston-centric. The new unemployment statewide numbers are out today, 4.9%, pretty much flat where it's been. The city numbers don't come out until next week, but in March, Boston, Cambridge, 4.6% unemployment, Springfield, 6%, Pittsfield, 5.2%, Lawrence, Methuen, 8.2%, New Bedford, 8.1%. You can find the communities where you want them in the stats. What will you do day one to show that you're governor of the entire state when it comes to job creation, and not just governor of the 617 area code? Deval Patrick.

REILLY: I'll tell you what I'll do, the very first day.

SAHL: Er, Tom Reilly.

REILLY: I'll go back to my hometown. Back to my hometown of Springfield, which is in terrible shape right now. I'm going to bring that community together, bring the business of both public and private sector, and come up with a business plan that's going to make sure that Springfield makes it. Bankruptcy is not an option in this case. We've never had a city go into bankruptcy. It's not going to happen on my watch. I'll be down, and I will look at every section of this state by regions. And the south coast region, tremendous potential in these areas, R.D., tremendous potential. People, a very good work force, skilled people, people willing to work. An entrepreneurial spirit. That's all over this state. You tap into that, south coast, central Massachusetts, western part of the state, northern Worcester County, you can do all those things and get this state moving.

SAHL: We know people want to go to work, but we also know that the life sciences industry that we are told represent the future of the Massachusetts economy aren't building research labs in Springfield. They're not building them in New Bedford. How do you get them there? Chris Gabrieli.

GABRIELI: You're absolutely right that there are different strategies for different regions of the state. And the current governor said he was going to put together regional planning boards. I believe they've met. I don't believe those plans have been acted on. And you're right. It's different. In my proposal on stem cell research, I proposed, for example, one specific piece, which was to invest in a division of regenerative medicine at UMass Medical, which is in Worcester. And one of the reasons I proposed that is, there's a whole regional economic aspect to connecting Worcester, which has very significant biomedical assets, particularly in UMass Medical, but also in WPI, connecting that up to Boston, so that we stretch the benefits of the strongest part of our economy, which clearly is the greater Boston innovative economy. Stretch it out.

Similarly, I think if we connect better up by train, for example, New Bedford, and Fall River, and Taunton, they're well within the distance of greater Boston to benefit from sharing in that economy, some of it by having people who commute and live there, some of it by having facilities spread there. Lawrence is a close drive by. It is well-situated on highways. We've got to accelerate the success of the mills in Lawrence, the redevelopment of mills. There's a software company there that I took a look at that's a booming little company, Blacksmith Applications. That company could be the cornerstone of a revival in Lawrence.

SAHL: Well, let me give you another example. We had the CEO of a life sciences company on our New England Business Day program recently. His company develops vaccines. He has maybe a dozen employees. It's not a labor-intensive business. And the medical centers and the learning centers around which these life sciences companies are centering aren't in Pittsfield. How do we broaden this economy to create jobs? Deval Patrick.

PATRICK: R.D., the point is well taken. The life sciences is the only sector where manufacturing jobs are growing, not very fast. But they are important, but they are not enough, is the point. We need different strategies for different regions. I think that as a candidate Mitt Romney was on to something when he talked about the governor's role as chief salesman or booster for the state. I don't think you can do that effectively if what you're selling is the butt of your joke. But if you believe in Massachusetts, as I do, I think you can do that, and I think you sell different economic conditions as apply in different parts of the state.

So for example, in Springfield, which is crying out for manufacturing good, livable wage jobs, there is a biomass opportunity that we can build there because of its proximity to so much of state forest land. And I'm not talking about clear-cutting state forests, but I am talking about clearing up the undergrowth and using that to distill biomass. I think the next thing for us in Massachusetts is going to be cultivating an industry around alternative and renewable energy. The technologies, the products, the services. If we get that right, the whole world is our customer. It's good for us from an energy point of view, and environmental point of view, and it's a big economic opening. And it's one of the reasons why I do support the wind farm in Nantucket Sound.

SAHL: Christy Mihos.

MIHOS: I think nothing changes in the Commonwealth until the burden on homeowners, business property owners, is relieved at this point. This state is just unaffordable for so many people, and a corporate CEO is not going to come in here, invest in the Commonwealth, when he can't hire people that have been educated here, trained here, and then can't afford to live here. They're going elsewhere. We've lost 190,000 – educated work force of 190,000 people over the last five years. And companies are not going to come here just because we want them to come. We've got to lighten the load on people. I did a focus group up in the New Hampshire border, and people were telling us, they can register and put on the road three cars, or two cars, in Maine for the price of one in Massachusetts. And that's just one of the multitude of fees, fines and taxes that the people in the Commonwealth have to look to each and every day. The state is unaffordable. We're – Beacon Hill is burying the middle class, and no one's going to come and open up anything in Massachusetts until we attack that issue and make it affordable.

SAHL: So, if part of the answer is to pay people more money, the minimum wage in Massachusetts is now $6.75, highest in the country. The Massachusetts Budget and Policy Center says raising it to $8.25 an hour would help half a million people. Should we do it? Christy Mihos?

MIHOS: Look at, I start my people on the Cape at $8 an hour, part timers and all. I would rather not have anybody tell me how much I'm going to pay people. I –

SAHL: Be a sport, Christy. Give them the quarter.

(laughter)

MIHOS: Actually – that's what we start them, R.D. But really, I'm not going to hold out anybody's wage when they're managing a $2 million convenience store, basically, and hopefully doing it right. Holding down wages is not where we should be. We should be – the next increase should be an affordable healthcare plan that we can offer our people, absolutely.

SAHL: So let's say you raise the minimum wage to $8.25 an hour. Businesses now pass that on to their customers. Prices go up. Massachusetts becomes even less affordable. What do we do about getting people's incomes up, and still address this problem of job creation, affordable housing, affordable healthcare? Chris Gabrieli.

GABRIELI: Well, I think this relates to the previous question. Economists have looked at this issue. What drives economic growth and jobs? Robert Sola won the Nobel Prize. He's over at MIT. You can go visit him. He talks to candidates. Even when I was Lieutenant Governor candidate, he would talk to me, which I thought was quite an honor. The number one driver is the rate of innovation, and that's why I'm focused on science and technology, cutting-edge areas. But the number two driver is the level of skills in the population, human capital. We have a tremendous opportunity to improve on that. The south coast, as an example, that you mentioned, has the lowest college graduate rate in our state. One of the challenges, therefore, is how do we get kids to finish high school in New Bedford? The mayor is obviously greatly concerned because he sees such a huge dropout rate in that city. Those kids dropping out, when we lose those kids at that point, they've lost their opportunity, whatever the minimum wage is. Even if we raise the minimum wage, and I support that, that's not going to get them into the middle class. That's just a step better from the bottom. So we've got to raise skills. That means we've got to reinvent schools so it works better for kids. That's why I've worked on changing the whole concept of the school day, so that kids finish high school. When you have 30% of kids dropping out in our cities, those kids aren't going to go on to a good middle class future. We've got to increase the rate of going to college, completing college. We've got to hold our higher ed institutions to greater accountability when we have huge failure rates to finish a college degree. We've got to make college more affordable, because that's the only way people get the skills to get the best part of our economy.

SAHL: I'll come back to education in a moment. $8.25 an hour. Deval Patrick, Tom Reilly?

PATRICK: I support the increase in the minimum wage, but I think we ought to be clear. Most people can't live at $8.25 an hour. What we need to be focusing on is a livable wage, and indeed, what we need to be focusing on is how we make the economy strong enough so that it isn't leaving people behind. And that's why we need to execute on multiple fronts simultaneously. It's never one thing. We've got to get at the high cost of housing, and the strategies around more supply and greater access to convenient and affordable and attractive public transportation is important in that respect. We do have to be about an innovation economy, and I happen to think, as I've said before, that an investment in cultivating an economy around renewable and alternative energy is a big play for us across the state. We also have to be about a much more serious and effective and consistently excellent public education system, starting before kindergarten with early education opportunities, and going right up through public higher ed, where today we spend behind Mississippi and Alabama in supporting public higher education. So the bond bill on stem cell research that I proposed way back in the fall was to take those proceeds and invest them in research facilities in public higher ed, so that we would stimulate the development of their facilities and their faculty.

SAHL: All right. We'll come back to education in a moment. Tom Reilly, raise the minimum wage?

REILLY: I do support raising the minimum wage.

SAHL: You like $8.25 as a number?

REILLY: Also aligning it with inflation. But first of all, the key to our future here in this state is innovation economy. That is going to drive this economic engine. And the key to it is going to be a work force that is highly skilled and trained. That's why the very first plan that I came out with was a significant upgrade in the math and science skills of our kids. That is going to be the key to their future. It is going to be the key to our future here in Massachusetts. And we have to do it not just through K through 12 and pre-K through 12. We have to do it in our public universities as well. You can have – we haven't had a governor that has had public higher education as a priority. It is a priority of mine. But let's cut through an awful lot of what's going on in this state right now, because we are not going to be able to create jobs and grow this economy until we start getting rid of the endless red tape that is stopping development and stopping growth in this state. There are countless cases. As I go around this state, businesspeople tell me, why build here? I have to go through a whole layer of local approval and permitting. I get through that, then I go to Boston and it's held up for another six months. It can take up to five years to get a project approved in this state. That's the life span of a product in innovation economy. We can't have that. We have to cut through this on a more supportive state and local government to the business community in this state. That's how we're going to move this state forward.

SAHL: I want to close this one out and move on to education because you've all mentioned it. The MCAS, the New Bedford School Committee, opted, voted to issue general diplomas to students who had completed local requirements but not passed the MCAS. Right thing to do? Chris Gabrieli?

GABRIELI: No. I don't agree with it. Mayor Lang is a good guy. I understand his compassion for kids who have finished their four years in high school, passed through that system, and still haven't quite passed that MCAS. Of course, the right thing to do is get those kids the skills. Giving them a diploma that does not mean that they actually have the skills to succeed – our remedial rate, for example, in our state public higher ed institutions remains almost where it was beforehand. That means to say, we're not graduating yet enough kids with the high skills – not just passing the MCAS, proficiency –

SAHL: Dump the MCAS? Would you get rid of it?

GABRIELI: No, no, no. I'm saying, I support the MCAS. I think it is crucial that we ask, not MCAS, no MCAS. Why aren't we getting kids in our poorer communities up to proficiency? How do we continue to fail the most important challenge? It's a civil rights challenge. It's an economic challenge. It's a challenge to our fundamental values. And that's why I've spent so much time on this question of, why do we live with a school system that's 100 years old? Why do we stick to a calendar that was OK when we had 1% of kids in 1900 going to college, and 10% graduating high school? It won't work. We're finally facing up to the fact that we don't really know how to take large numbers of kids from disadvantaged backgrounds and get them consistently up to the high proficiency. It'll take innovation.

SAHL: I want to give everybody a shot at the education and the MCAS question. We're getting close to closing. Deval Patrick.

PATRICK: Well, the MCAS, I think, is not the issue. It's that we take the MCAS and we slap it on top of a school system that's already under strain. I visited a school in Roxbury called the Mason (sp?) School. It's a pilot school now, but it's been on this upward trajectory for some while now. And I felt like I was walking through my education vision. They had 3- and 4-year-olds in early education opportunities in that school. They had all-day kindergarten. The typical class size, public school, is 11 children. Their school day starts at 7:30, 8:00 in the morning, goes until 2:00, 2:30. And then they have mandatory after school. They plan, not just in a class or a grade, but from age 3 up to grade 5. They have a couple of--

SAHL: Quickly, cut to a point here so we can get the others in.

PATRICK: My point is this. Their MCAS scores are off the charts, but the MCAS has receded in importance because they have more time as professionals in that class to pay attention to the whole child, and that's the direction it seems to me we need to be moving.

SAHL: MCAS the problem here, Tom Reilly?

REILLY: No. These kids are as good as any other kid in this state. They just need some extra help to get up, and they'll pass that bar. We've done it before in 2003, when they said they wouldn't meet the bar. Give them a little help. A lot of kids struggle, and particularly in our inner cities and poorer kids. One test for everybody. We can't sweep it under the rug anymore. Get these kids up to par and give them a diploma that means something, an education that means something. That's the key to their opportunity. And frankly, it's the key to our future in this state.

SAHL: Christy Mihos, wrap up education for us.

MIHOS: Well, I've got to tell you, nothing's sacrosanct. And we've put billions of dollars into education reform since 1995, certainly. But at this point, it's coming along, certainly. But as long as we don't fund the cities and towns properly, and we keep stealing their local aid away from them, such that programs aren't getting funded, teachers aren't getting paid well, and schools are closing, nothing's going to change.

SAHL: All right. We go to our closing statements this evening, the order determined by draw before the forum tonight. We'll start with Tom Reilly.

REILLY: Thank you, R.D. And thank you all for being here and all of you for watching and listening tonight. As I go around this state and listen to the people of Massachusetts, they tell me that we're going in the wrong direction, and it's time for a change. And they know that for the past 16 years we have had four successive Republican governors who haven't stayed around long enough to get the job done. I will. Every job that you've given me, I have finished. Tonight, we've had the opportunity and I've had the opportunity to share some ideas with you. We have more. Visit our Web site, tomreilly.org. But you know what? Ideas are just ideas, until they become reality. And that's where experience kicks in, the experience to implement ideas with action. That's how change happens, and that's what I've been doing all of my career, making change, making lives better for people. I've done it as the District Attorney of Middlesex County. I've done it as the Attorney General of this state, a tremendous honor. I'll do it as your governor. Thank you and good night.

SAHL: Deval Patrick, please.

PATRICK: R.D., thank you, and thanks to the sponsors and to everyone for being here, and to the panelists, as well. Listen, I came to Massachusetts in 1970 when I was 14 years old from a poor and broken community on the south side of Chicago. But what we had was a sense of community, because that was a time when every child was under the jurisdiction of every single adult on the block. If you messed up down the street in front of Miss Jones's, she'd straighten you out as if you were hers, and then call home so you'd get it twice. The point is that the adults treated us like they had a stake in us, and they taught us as kids to understand we had a stake in other people. When I came here to Massachusetts, I was prepared for and exposed to by the people of Massachusetts and the institutions of Massachusetts, an extraordinary range of opportunities, multiples of the American Dream. And what I'm interested in doing is showing the kind of leadership that brings that sense of possibility to others. I see the potential in this Commonwealth, because people in the Commonwealth saw that potential in me. And that's what I'm going to bring as governor.

SAHL: Chris Gabrieli.

GABRIELI: Thank you to the sponsors and to the audience here tonight for the opportunity to talk about a fitting starting point for the public debates here, the issue of jobs and economic growth and opportunity, and the affordability of this state. You know, I don't think it's a surprise that Lieutenant Governor Healey is absent tonight. The Romney/Healey administration's been absent on these issues for almost four years, and the price to the Massachusetts has been high. And I'm running for governor because, in a lifetime of being accountable for getting real results makes me want to step forward and say, give me the opportunity to invest in our state, to build on the great assets we have, to take advantage of the extraordinary universities, the extraordinary people, the extraordinary institutions. It'll grow our economy. It'll give us the innovations to address really deep issues like a switch to renewable energy. It'll create the sort of Massachusetts that drew me here, that made me want to dig my roots deep here, with a family that wants to be here for generations to come. Massachusetts deserves leadership committed to that vision.

SAHL: And Christy Mihos, wrap it up for us.

MIHOS: Thank you to all the sponsors for doing this. It's been a pleasure tonight. Thank you. R.D., you did a great job. (laughter). We all love Massachusetts, and it's time for real change for our state. The fact is, taxes are just too high, and that's why people and business and jobs are leaving. The property tax burden is just killing the middle class. It's making the state unaffordable. My Proposition One will rectify this inequity. The fact is, the Turnpike tolls must come down and return $140 million to those communities in central Mass, Western Mass, and Metro West. There's no question Beacon Hill is not funding education properly. Forty percent of state annual revenues is the right number, and it'll solve that issue. There are many interest groups here in the Commonwealth, some very worthwhile.

SAHL: Time coming, Christy. Wrap – one sentence. Go.

MIHOS: One sentence, huh?

SAHL: Sorry. The unforgiving clock.

MIHOS: Thanks again.

(applause)