most memorable campaign of any that i have covered. we will never see it again. he was facing george debut bush who had the -- george w. bush who had everyone backing him. he stayed at town hall meetings until every question was answered. john mccain said we are not getting a patient's bill of rights as long as my party owns the insurance companies and the democrats on the trial companies. it's a refreshing cantor. it is a welcome this. no one had seen it before and nobody has seen it since.

>>mark shields on his career in politics, sunday night at 8:00 on c-span's 00q &a." >> nikki halye talks about public school funding and croats and edgar structure. from south carolina, this is about 50 minutes. >> thank you. [applause] thank you very much. mr. speaker, mr. president, ladies and gentlemen of the assembly, constitutional officers, and my fellow south

carolinians. this year we will continue the tradition of recognizing a certain truth that everything we have in this state we 0 first and foremost to the men and women in uniform who serve on our behalf. [applause] please join me as we pay tribute to those that gave the last full measure of devotion in the service of their state and country this past year.

on behalf ofsouth carolinians, know that we will never forget. [applause] we love and respect our men and women in uniform. few things make me as proud as the patriots and radiates off of our state and her people. when i make that call to the families who just lost a loved one, i promised them that the people of south carolina will

wrap their arms around them and never let go. and the citizens of this state have never let them down. a wonderful example is the four thousand 150 volunteer members of the south carolina patriots guard writers. we have seen these selfless men and women. their mission is twofold, to show their respect for our fallen heroes, their families, and their communities, and to shield the morning family and friends from the interruption of protesters. please join me in welcoming a warm south carolina thank-you to the state captain of the south carolina patriots guard riders. may god continue to bless you and your volunteers for their service. [applause]

we have another very special guest with us tonight, a hard- core rock star. the commanding general of one of the greatest military institutions. if you do not believe me, too were it yourself. do not mess with this general. the marine corps has been with us since 1950 and they have trained there for every major conflict of the 20th and 21st century. we are so proud of our marine corps. we are so proud that the most impressive training facility in the world is located here in south carolina. and we are proud that general reynolds has found our state to be her home. [applause]

i would now ask that you indulge me a brief moment of personal privilege. when we at the family started this administration one of the biggest challenges was moving into a house that was a museum. a wonderful, beautiful, historic building. a museum nonetheless. as a mom, my biggest challenge was to make that house into a home for all of us. we were blessed to have a family that welcomed us and understood the games our kids would play a putting wigs on statues, given the security team nicknames and playing jokes on the staff constantly. we love them all. there was one person that left our lives.

chamberlain branch became a staple of the residents. he made everyone feel special and welcome. most importantly, to this mom, he was the person my children cannot wait to see when they got home. he was the one that turned the house into a home for us. our family was blessed by his unselfish kind this to our children and everyone he came in contact with. he was tragically killed in december and our hearts remain broken. he has three young children who were staples running through the house. we are blessed to have his amazing life with us tonight. please join us in recognizing sure reese -- in recognizing,

charise. while you maybe missed, you will never be forgotten. [applause] i also have the pleasure of being humbled by two little ones who remind me how cool it is to be their mom every day. whether it is getting them up and out the door every morning for school, sometimes fighting about what to wear or whether to go to school and all, they have a way of making me remember what is truly important. they put up with a lot but never lose the smiles on their faces. please join me in welcoming my kids.

[applause] of course our family is clearly missing someone tonight. my husband is deployed with the south carolina national guard to afghanistan. we will miss him terribly. he is doing exactly what he signed up to do, serve his country. he only asked me to remind our state and country that we are just one of thousands of families that no the military service that is given. we thank you for the many pressures and messages of support that have been sent to our family. it has given us strength and inspiration. we look forward to having him

and his entire unit back safely with us next year. [applause] ladies and gentlemen, the state of our state is productive. in spite of the challenges that come our way. the last decade has not been an easy one for our nation. through the financial crisis and the deep recession that follows, we have watched washington founder on both sides of the aisle, bouncing from one solution to another. the result of our federal government's incompetence have been predictably poor. if a step into recovery, job numbers, rising unemployment. 31,574 jobs.

over $6 billion in new investment. unemployment at a four year low. and two 11-win football teams. [applause] i was a proud governor when both our schools one this year. tonight we what we did tonight we have two very special guests, the quarterbacks who led the tigers to a win on the biggest stage of their lives. please give a round of applause. [applause]

i personally want to thank you because you are the reason i got a sport coat tonight. coming into office i made a promise to the people of south carolina. a promise to eat, sleep, and breed jobs in our state. we have all of the tools to be successful -- a beautiful state, a place where any person would want to work, live, and raise a family, a loyal and dedicated work force with a burning desire to learn, and one of the lowest union participation rates in the country. we need to let the nation and world know that south carolina was open for business, show them the positives of our great state and the progress we have made as a state and as a people. we have done that. in two years we have announced new jobs in 45 of south

carolina's 46 counties. we have cut taxes on small businesses. we have passed reforms that put the cap on lawsuit damages. we fought against the unions rejected unionization of south carolina -- we fought against the unionization of south carolina. the department of social services moved more than 14,000 families from welfare to work. we created a business partnership to showcase the largest industry in our state. we have been rewarded for the second consecutive year a gold shovel in recognition of our economic development success. we have been ranked the second best nation in -- the second

best state in the nation to do business. [applause] we have announced $5 billion in foreign investment and we have seen no less authority than the wall street journal say that anyone who thinks the u.s. has lost its manufacturing topps has not been to south carolina. "it" stateoming the :it when it comes to economic -- i would like to ask you to help me welcome these wonderful friends of south carolina. please stand and remain standing when i call your name and hold your applause until the end. representing 500 jobs in lexington county, richard.

representing 126 jobs in georgetown and williamsburg county, vicki thornton. representing 124 jobs in union county -- the line representing 100 jobs -- representing 1000 jobs in lancaster county, mark. representing two hundred jobs in berkeley county, kim. representing 80 jobs in florence county, henry. representing 750 jobs in richmond county, reese. representing 190 jobs, bruce. representing 50 jobs, jim. representing honda of south

carolina manufacturing, brian newman in celebration of the fact that they produced their two hundred million 80 v. -- their two hundred millionth atv. please join me in showing our support to these great friends, old and new, and thanking them for making south carolina their home. [applause] as if we did not have enough to celebrate last year, this year we have talked ourselves. as our beautiful city was named

the no. 1 tourist destination in the world. representing the charleston area is helen hill. the citizens of charleston deserve a round of applause. [applause] i am also of the mind that when any south carolinian succeeds it is a great day in south carolina. we should be proud of a great friend to the state, dr. louis. in 1985 he found -- and his successes and contributions have not gone unnoticed. this past year the united states department of commerce

gave him an award as the nation's small business person of the year. congratulations. [applause] if the companies represented here tonight chose south carolina to be their home is a tribute to the state we have right now, we can absolutely do more. we will do more because none of us should be satisfied until every person in south carolina has the opportunity to find work. first we cannot rest on our morals when it comes to our tax rate. you have all heard me say that south carolina needs to reduce its tax burden never has that been more important than now. citizens are opening their

paycheck and seeing the tax hike on the rich somehow got them to. i propose we eliminate the 6% tax bracket. this cuts taxes for the overwhelming majority of people who pay income taxes. no south carolinian will pay more. [applause] other states have seen the successes we have had in south carolina and are nipping at our heels. look around the nation and see the legislature's, the states that are proposing slashing or even eliminating their income taxes. we have to keep up. we need to take a serious look at our regulatory environment. if government is causing -- costing business time, it is costing that business money. i know of no joint legislative

and executive effort that comes together to look at removing regulations in the private sector that hold our economy back. that changes this year. i am announcing the formation of a gubernatorial task force largely to be made up of members of the business community that will review regulations and recommend those we can eliminate. some changes can and will be made at agency level. while i will be directing by executive order all of my agencies to begin this review process. some may require legislative action, which is why i am asking you to join me in this effort to invite majority leaders to make an appointment to the task force. it has always been my belief that the best way to improve new businesses in our state is to take care of the businesses we already have.

with the business community as our biggest cheerleaders, there is nothing we cannot accomplish in the great state of carolina. [applause] we have to address our crumbling infrastructure. our roads and bridges are simply not up to standard. more than 1000 of south carolina's bridges are structurally deficient. first and foremost, it is a public safety issue. the citizens of south carolina deserve to drive on roads that are not littered with potholes and on bridges they know will not fall down. it is a core function of government but it is also an economic development issue. south carolina has announced ourselves as the new superstar of american manufacturing. we build things, planes, cars, tires, if we build more atvs than anywhere else in the world. we need roads and bridges that

manevich -- that match the quality. i will not ever support for raising the gas tax. [applause] the answer to our infrastructure problem is not to tax our people more, it is to spend their money smaller. why would we raise the pac's? -- the gas tax when it does not go to improving our infrastructure? millions of dollars are being diverted away from our bridges and highways. let us invest more of the money we already have been to this vital area. every year you hear me talking about the money trade that falls during the session. let us -- we have is leased a

new executive budget that is balanced -- released an executive budget that is balanced. we have estimated $95 million this year on road and bridge improvement. we can make our state safer and our businesses can be even more dynamic. with us is mike mccall. he is one of you on some heroes of south carolina state government. as a legislature it was always my belief that giving money to corrections was giving money to criminals. there were better and more noble places to put our tax dollars. the warden will tell you that is not true. twice this past year he has had prisoners take control of one of his presence. he has seen one of his guards physically beaten and left for

dead in a janitor's closet. i have been there. i have seen it. he will tell you that if we give money to his facility, it is not going to prisoners. it is going to guards. that is a matter of life for -- a matter of life or death for them. join me in welcoming warden mike mccall. warden? [applause] we cannot talk about security without talking about the department of revenue and its protection of the personal data of the people of our state. plenty has been said about the international criminal hacking

that took place. i am not here to rehash it or look backwards except to say this -- when it comes to the test security, the state of south carolina should have done better in the past and will do better in the future. that does not mean we will be 100% protected. the lesson i learned is that there is no such thing as absolute security. that is true for conventional terrorism and home and security and it is true for cyber terrorism and cyber security threats. it is a hard reality. what it does mean is that we will do everything we can to make sure that no state in the country has better security measures in place than we do. already we have taken a number of steps in that direction at the department of revenue. we are encrypting all personal and sensitive data. this month we will have completed implementation of two factor identification for employees.

we are making sure our most sensitive information is protected separately and securely. we have created a security council within the department, a team of professionals that will meet regularly to discuss the state of our security in this changing world and constantly update our processes. by the end of this process, the department of revenue possibly topple be as secure as any in the private or public sector. it is not dor that requires our attention in october i asked for a review of i.t. standards in our government. his report made clear the following -- while cyber security policies were taken out on a daily basis, south carolina lacks a single entity with the authority necessary to better secure our system. we must fix that and we must fix it this year. i have also directed every single cabinet agency to work with our state i.t. department

and make sure that 24 hours a day, seven days a week, 52 weeks per year, our systems will be watched. i want to thank the chairman for their help in enabling the state to respond forcefully to this attack. i ask you to ensure that it is not just cabinet agencies, but every government agency to provide our citizens the security they deserve. more than 1.1 million south carolinian have signed up for credit protection. they are good honorable companies that will help keep our information protected, and at the same time be respectful to the citizens of south carolina who have turned to them in their time of need. every south carolinian watching tonight, let me say this -- if you have not signed up yet for protection, if your friends or

co-workers or neighbors or siblings or parents have not signed up for protection, please urge them to do so. it is so important. viwit www.protectmyid.com and use the activation code -- my pledge to the people of our state is that we will do everything in our power to come out stronger than before. we come now to the part of the evening that they feel like deja vu to some of you, restructuring. few of us would deny that our government cost structure is outdated, broken, and does not serve the citizens of south carolina. every year, governors have said -- have sat before you and

pledged to bring our government into the modern arera. it feels like we face the same obstacles every year. this year, i want to keep it simple. two critical ways to the way south carolina is structured. first to the department of education. last year the house passed a bill to allow governors the appointment of superintendent. i cannot state how important this change is. all we are asking is that we give the voters the opportunity at the ballot box to make this constitutional change. the south carolina house of representatives report -- of representatives supports it. let us give them that opportunity. they deserve it. [applause]

now to the department of administration. each of the last two years i have made the argument of ridding our state of the big green monster that is the budget control board. some of you have made that argument with me. for me to do so again tonight would be redundant. i believe most of you know that it is the right thing to do. instead i will make this observation -- if one came to south carolina from another state or country and saw the way the department of administration bill was handled last year, he or she would surely be confused. the senate unanimously voted in favor of it, a large majority in the house voted for it, and it still did not pass? how is that possible? how did the senate not even take a final vote on that day? that is not the way our system

is supposed to work. one might conclude that some of the votes in favor of restructuring are contrived. one might even think that some wanted to be on the record in favor of it while at the same time trying desperately to stop it from happening. to that i will say this -- i wish a warm welcome to all of the newly adopted members of the house and senate. but i want to extend a special welcome to the new center of lexington county. -- to the new center of lexington county. -- to the new senator of lexington county. there are no more excuses left. let us pass the department of administration and pass it this year. our structure of government isn't the only place south carolina blacks behind the rest of the country. in recent years there has become

a topical sense among the people of our state that something is fundamentally wrong with the way many elected officials have conducted themselves. in some ways that sense is unfounded. the vast majority of our elected officials are honest and honorable people. but in other ways the public is fully justified. for too long boats were not being recorded, hundreds of would-be challengers were thrown off of the electoral ballots while incumbents skated by untouched. the people by and large believed the south carolina government is set up in a way -- we have made some progress over the past few years, starting with the passing of a bill that requires every vote on the general assembly be on record. i thank you for making that a reality. we still have not done nearly enough. the state integrity investigation took a look at every state's risk for corruption and the south

carolina and f. -- and gave south carolina a f. we got an f for our public access to information, to our state budget prospects, in nine of the 14 count -- in nine of the 14 categories they considered. every single one of us know that is not good enough. the people of south carolina deserves better. that is our responsibility, our obligation to give it to them. i think we also know that if the public is going to trust the changes we need to make to the system, then we should not be deciding on what those changes look like. instead our ethical standards should be determined not by those inside the capitol but by those who have no stake in our rules. in october and created a panel of people to help us navigate

this reform process. it includes former prosecutors, former members of our ethics commission, former legislatures, members of the press, appointees from each of your buddies, democrats and republicans. most importantly it is made up of people who have nothing to gain from their participation other than dissatisfaction of moving south carolina for. -- moving south carolina forward. a talented and diverse group of people worked so quickly and diligently at the task at hand while every member of the south carolina ethics reform commission deserves our thanks and praise. i ask you to join me in welcoming two attorney-general spa -- two attorney generals. [applause]

they have thrown themselves into this process with an intensity and since of purpose that is the great hope for the recommendation they will deliver to us within the next two weeks. they have been thorough in taking testimony and gathering research from those in the system as well as those outside of it. i have every faith that their recommendations will make south carolina stronger. our citizens must have confidence in how we do our jobs. that confidence will come from adopting the recommendation of this bipartisan and unbiased group of experts. our citizens deserve no less. and we should accept no less. [applause] now let us talk about health. for all the debate we will have

over health care in the coming legislative session, i believe we all agree that we want and need a healthier south carolina. no one can deny that this administration, working with legislatures, has made health a priority. we started 2011 with the medicaid budget out of balance and we brought it under control. we started with one of the lowest rates of insured children in the country. we started with mental health and addictive disorders programs hobbled by cuts. we have invested in both. we started with the medicaid program that requires little accountability for " -- for quality and cost. let us ask a simple question, are taxpayers getting the most

help for the money they spend on health care? my answer is no, not by a longshot. we spend more money for health services per person than any nation on earth. year after year we devote a larger portion of our paychecks, and payrolls, our state and federal budgets, to health care services. maybe we would not worry about all this spending if outcomes were better. but they are not. the united states has fallen behind the rest of the world in mortality and life expectancy. here in south carolina we have one of the lowest life expectancies and highest infant mortality rates in the u.s.. with such high costs and poor outcomes, why would we throw more money at a system without first demanding improved efficiency, quality, and accessibility? the affordable care act says expand first, worry later.

california just raised taxes in part to cover their medicaid deficit, and that means 350 million more to pay for obama- care next year. that is not us, that is not south carolina. the federal government likes to wait around a $9 match like is a symbol or bullets. -- like it is a silver bullet. what good are any dollars when they come through a program that does not allow us the flexibility to make the decisions that are in the best interest of the people of south carolina. in the end, i cannot support this expansion for a very simple reason. as long as i am governor of south carolina i will not implement the public policy

disaster that is obamacare medicaid expansion. instead we need to improve health care. and we will. we are taking a lead in payment reform. this year alone, over $40 million of payments are tied to performance. which means better outcomes for patients and south carolina tax payers. we are asking beneficiaries to become more engaged in their health. if a patient does not follow a dr.'s advice to stop smoking or does not take their medication, we end up spending more money than necessary. more importantly they will never get healthy. we have to improve patient engagement and stop rewarding bad behavior. we are working on hot spots of poor health. we have already reduced harmful early deliveries by half. we are one of the first states

to no longer pay for this poor practice. we are investing in rural health because if you have medicaid -- this is true for reasons that go far we know that the rural hospital faces challenges that larger hospitals do not. for the first time ever south carolina will treat them that way. they now pay world hospitals differently from urban hospitals. we plan to replace them for their uncompensated care. money shifted from areas where we do not need less are where we need less for where we need more. we will continue to be created as we work to improve health.

as we go forward together this debate, i asked that we keep the following in mind. healt h and well-being is driven by income, personal choices, and genetics, and support from family and community. when south carolina says we're going to do something, we have to do it well. we cannot promise expanded medicaid a cut reimbursements solo doctors will not seek -- so as low doctors will not seek patients. we need to meet our current commitment before we promise more. there is enough money and our public and private health care system today to make the system work. we cannot spend our way out of this problem. it is too easy in the short term and painful in the long run.

the next three years is an extremely risky time. well maybe easier to take the federal money and there ought to pay for it later, i'm not willing to commit us to a short- sighted decision will not be able to back away from. we will continue working together to implement real help solutions. the health system that delivers the highest values will be able to thrive regardless of what the future is at test. -- rose at us. let's talk about education. it would be wrong to have a discussion about education without remembering the victims of the tragedy as sandy hook elementary school. please join me in a moment of silence. thank you. in south carolina we have done

some useful things on education in the last couple of years. we reaffirm our commitment to charter schools. we have invested innovation with a focus on rural and urban areas with programs like teach for america. we have pushed the government for more flexibility to evaluate our schools. we have seen some progress. our state still has a long way to go. there is no sure pat out of poverty than having an education. having a way we did well educated work force is a real factor in having more jobs to our state. i know there are some strong choice bill's letter making their way to the general assembly. i support school choice. it will be good for families to make their own decisions. that should happen a long time

ago. i never been one that believes choice is the only way to improve education. it is an important way. we have to do other things as well. tonight i want to start a conversation about the way we fund k-12 schools. i want to start a conversation for two reasons. i am not buying nature a patient person but i know through experience that the general assembly is not a body that moves quickly. i know that when we start to talk about to fund our schools, a lot of people can get really nervous really quickly. let's take this comely and start with a conversation. as we know, sometimes conversations lead to more. my starting point with this conversation is personal.

we are the proud parents of two children's in the public schools. i am grateful every day that my children attend public schools were the teachers are exceptional, the facilities are first class, and a walk through the halls with opportunities and help for the future. let's be honest. what i am describing is not what schools have. i grew up going to school and a brick box. my education was wonderful because a special teachers. when it came to resources we did not know what we did not have. i know what it is like the other four areas of our state. i am not one who believes that more money is the answer to our education problems. there are other bigger captors -- factors including poverty. in the amount of money that

touches the student in the classroom is a difference between the schools. the parents of those students pay their taxes but fund their education. i will pay no part in diminishing the return they receive. we do have to figure out a better way to bring up the schools and the poor part of our state. we cannot count on their restrictive federal dollars to do it. we need to spend our dollars harder. we need to be more accountable. we need to better serve all the children in south carolina. i want to start a conversation. i want to start with three distinguished members of this general assembly. the first to our center john cornyn and representative bill

elowen. the senator and i have had some differences. that is ok. that is politics. i respect his commitment to public education. i know he shares my interest in keeping our schools as great as they are. as a newly elected senate democratic leader, i know they have paid attention to education. i invite you to join me in this conversation. i am convinced we can do this policy and improved quality for all our children. i am also convinced that we cannot do that with the some sense to congress and without bipartisan support the consensus from all parts of our state. let us began the conversation.

i have found myself reflecting on the last two. i wanted to make changes that move us forward in which people can feel it. we have had some great successes together. we have had some challenges. watching a two-year research efforts fall on the senate on the last hour, learning that criminal hackers targeted our state are watching as both parties and washington are able to find resolution that helps states but places further burdens on them. i came away from these reflections very optimistic. i know what we have in south carolina we added over 31,000

new jobs because we acted as a team from the county level. the success we have it shows what can happen when there is a willingness to work together. the challenges focus on the issues in the finger pointing begins. my goal is to kenny to strive for a positive environment that produces results. we will be more productive. we should work to work for a resolution for the good of the state. the people of our states have enough challenges and deserve it satisfaction of knowing that colombia is working for them. we can spend our time playing politics. we can use the pulpits we all have access to