but there is more even as we are doing now. we stay focused on key issues. one is the ongoing fight to get the marketplace fairness act done. i think every governor realizes the inequality of this, the companies that have rick and mortar enterprise -- brick-and-mortar enterprise in our states, pay sales tax on every transaction that takes place, whereas companies that are struggling through the internet really are not paying any taxes at all. a number of governors looked at whether they will be able to actually lower their sales tax in terms of making sure that if we finally get this done and make sure that every retailer is playing by the same set of rules in every purchaser is paying the same tax, in many cases, i think a number of states can allow people to actually reduce their overall sales tax that they charge to everybody. i think this whole approach is going to help states encourage competition, it is going to

preserve main street jobs. i mean, plain and simple, it is just good for business. business does better when the system is fair. i think closing this unfair loophole, really governors and congress, the white house can and should come together. the senate overwhelmingly passed marketplace fairness last year and i think this year is the roll up our sleeves and see if we can help make sure that there is a piece of legislation that comes through the house. we offered congress a path forward for reauthorizing the water resources development act, and other resources to reduce the deficit, but at the same time, economic health. every governor, one of their top priorities if not the top priority is jobs. make no mistake, we are constantly innovating at the state level.

we are going to continue to work with our federal partners to practice solution that sponsors that resignation. i think the white house has reached out, how can we help foster this innovation, how can we accelerate innovation, and how can we help you reduce red tape? if you ask one governor one thing they would love to hear from the federal government, it is the partners and reducing red tape and creating a faster, more responsive, and more effective state government. so i will turn it back to governor fallin. thank all of you for being here this weekend, and i want to especially thank all of our governors. >> thank you. would the governors like to add any comments? we covered it? good.

we have got just a few minutes to take a few questions. yes ma'am. >> last conference, you talked about employing people with disabilities, and i know that's workforce development is your initiative. i wonder if you and the other governors can reflect on the progress that you have been able to make since releasing the last initiative and your own states employing people with disabilities. >> absolutely. governor markell, our former chair from delaware, emphasized the importance of helping people with disability find work and implement an encouraging the private sector members to step up with programs to offer jobs and certainly help educate our fellow governors, the importance of great, successful programs, best practices that are out there. in my state of oklahoma, there are many different programs that we initiated, talking to the private sector about employing people with disabilities. i think all of us took that message to heart.

we tried to implement programs that we saw have been successful in other states and it is an issue that we will continue to pursue because we still believe it is very important, and it actually fits right in with our initiative this year, which is education and training for tomorrow's jobs. certainly those with disabilities, certainly one of my top issues is helping veterans find a type of work that they need when they come back from serving our great nation. but in the end, what we want to do is put americans to work, be able to fill the skills gap between what employers need as far as the type of offerings that they have, real in our education systems back for our k-12 on up to higher education and make sure that we have a highly competitive skilled workforce of that not only can they compete among our state, we can offer children a brighter future, help are working adults be able to hopefully move up in

their type of skill and a level but also to help america be more competitive. we operate in an international global economy. we find our states competing against each other but also against foreign countries. >> let me just add to that. at least in utah, gary herbert from utah, we have taken that to heart. we have a slogan in utah that if you cannot work, you will work and we are trying to find those skills to help people. everybody can do something. our department of workforce services is very tuned into helping people develop these skills that the marketplace wants. the head of our department workforce services was a lady by the name of kristen cox, and she is blind. she is an inspiration to many because she is proving the fact that no matter what your disability is, there are some that you can do in a significantly positive way.

she has done such a great job. she is now my director of office budget. we are in the process of going through that with our legislative session. as mary has said, it is anybody who needs a helping hand. we are trying to help them develop the skills to be able to find a place in the marketplace to be self-sufficient. >> i know a number of states also are working specifically with returning veterans, many have come back with post dramatic stress. other abnormalities. and making sure that we go above and beyond to make sure that they have the right training and again, if people can work, we need to find ways for them to work. >> i think that is all. the lights are pretty bright. here we go, i am sorry.

>> thank you, governor. it being the student of history that he is, governor beebe can appreciate this. a year ago at your opening news conference, governor, you spoke, the questions and your remarks were devoted almost entirely to sequestration at the time and how the states were going to deal with it. a year after the fact with sequestration being eased, was it a good or bad idea in the long run? and did your state suffer from it in any way? >> are you asking me? [laughter] across the board, nonspecific and long-term sequestration is never a good idea. there will always be priorities in different areas and to be held in different ways in lieu of a meat ax across the board. it had some desired effects in terms of getting people's attention.

it also had some effects that people in conference should not anticipate. that coupled with the government shutdown in other actions in congress further depleted the american public's confidence in congress. the last thing i thought was the approval ratings were at their all-time low, and so to the extent that it has changed some attitudes, and we are not going through it all again this year and going ahead and trying to get the budget through and going ahead and trying to make sure we do not have the same sort of stalemate, it had an effect, but like a lot of things, you end up suffering a little but as you go through that. we had a lot of folks who had a love states suffer -- i know gary was in the headlines because with their parks out there during the shutdown, that is such an integral part -- and all of our states suffer from a desperate he had to do some extraordinary things that the rest of us did not have to do. the ultimate message subsequently on further inaction

of the government shutdown and sequestration, and really some draconian action that was not particularly well thought out. and to give them their due, part of that they did not have a lot of choice because they could not get people together. i keep harking it back -- all these folks keep talking about the deficit and the national debt and our children and to become such a great experiment in political rhetoric to try to be yourself elected, and that is a major problem, but i harking back to the idea that it was a problem that can be solved, and it took bipartisan cooperation. was it two years ago, three years ago, erskine bowles told a great story, and many of you may have been in the audience that heard it, but you had a

republican majority leader in the senate, trent lott,, you had a republican speaker of the house by the name of newt gingrich, and you had a democratic president by the name of bill clinton, and erskine bowles, his chief of staff, over to the leadership to sit down and start talking about how to we attack the national debt, had we attack annual deficits in an effort to get to the national debt, and for several weeks, according to erskine, nothing happened because everybody was waiting for somebody to run to the press, beat their chest, disclose, try to gain points and after a few weeks when they all kind of realized that they were all serious and nobody was trying to take political advantage, they got serious. the end result of those conversations was that we had three years worth of surpluses that approached one third of $1 trillion. $340 billion annual surpluses.

some suggest that at that trend continued for a few more years we would not have had a national debt for the first time since andrew jackson. it can be done. it is not like oh, those were different times. that was the 19th century, you cannot do that now, or that was the early 20th-century and you certainly cannot do that in the 21st century, and that is bunk. you can do it all with tax increases, readjustment, or whatever euphemism you want to use. it takes honesty and it takes hard work, and it takes the kind of cooperation between the executive branch and the congress that was exhibited in recent years, and nobody deserves all the credit for that. the republicans deserve half the credit for that, and the democrats deserve half the credit for that. it is like what mary was saying. governors usually have so many things that they are so aligned on that you can almost drop the

party label. as was pointed out, we do have certain areas where we do disagree and we get into fights, but our problem-solving requirements seem to transcend all that political rhetoric and all of those political labels, and you can actually do that on the federal level as well as demonstrated by bill clinton trent lott, and newt gingrich. they all got serious about doing that, too, instead of just talking about it. >> can i just add something? what he says is really important. the fiscal cliff and the shutdown were not good, they were not good for washington d.c. it is akin to wanting to lose weight and you just chop your foot off. that being said, the states are stepping forward, as you heard our chairman, mary fallin, talk

about, and john hickenlooper talking about flexible federalism. we will take less money from the federal government in utah if you will take away the strings in the red tape. we can build roads better with less money if we do not have all of the federal strings and red tape. we can educate our kids better if we don't have all the red tape and strings attached to it. health and human services, medicaid expansion. secretary fox gets a transportation issues. he is a local guy and understands that strings sometimes get in the way of efficiency. so we are proposing to the evisceration and the congress, take away some of these inhibitors of making us more efficient, take away the strings and red tape, give us more flexibly in the states, and we can take less money and do more with it. it'll help us, it will help washington balance their budget.

>> i would like to add one comment, jack dalrymple from north dakota. we are one of the lucky ones in north dakota. we have a very strong economy. we actually have a budget surplus in our state, so we were able to deal with the effects of sequestration, but they are real. in many cases. especially in areas like flood control or water supplies or especially roads and highways. we have had to make up for substantial amount of funding with our own state funds. and we feel blessed that we were able to do that, but these are real dollars, and of course we would like it if the federal funding would continue at the levels that it had been, but you know, we find our way to stay ahead.

i think what frustrates people is the silliness that you get into indie sequestration process. we had one example of a part-time information person at our national park system who provided information to tourists on the interstate highway every summer on how to find the park. the total cost of the part-time person was $35,000, and the federal government chose to cut that $35,000, and that got quite a bit of attention, and needless to say, and we had to find a way to get a grant through a foundation group that could in turn find somebody to staff that position. so sometimes you are jumping through an awful lot of hoops

just to solve a problem created by sequestration. >> one last question. >> in dealing with our economic problems, it seems that there are very different strategies across the states, especially looking at the republican-controlled states versus the democratic-controlled states, and i wondered if the governors would care to comment whether this seems to be a question of having different goals or are the goals the same, and if the goals are the same, where does nonpartisan analysis about what does work and what does not work fit into this policy? >> that is the beauty of the

nga, it gets the governors an opportunity to come together. we have a governors only session where we talk about different issues, and a lot of times we find our common issues going on in our states. we may have different allusions to the problems facing our states, but we learned from each other through best practices through innovation, and in a lot of states, we will look at other governors and other programs and that may be of a different political party. in the end, all the governors have the same goal, and that is we want to create a very strong economy, we want to create jobs, we want to improve education, we want to be fiscally sound within our state budgets. we are all concerned about washington, d.c. and the unfunded mandates and cost shifting down to us. we want more flexibility. those are all things that we have in common. so we may disagree about some policies, you know, how do you grow your economy? some states like to lower taxes, some states want to make adjustments with their taxes maybe different ways you reform

education or your energy policy may be different. governor hickenlooper and i work a lot together and governor dalrymple and governor herbert on issues in our state, but anyway that we can come together and collaborate, we think we are a strong force because while washington many times has inaction, a lot of uncertainty we have governors cannot afford the inaction because we have to balance our budgets, we have to create jobs and improve education, so we are all about learning from each other and trying to find those best ways to do it. governor? >> just to add a point, i think nga is one of those rare but great opportunities for governors to work together on policy. it does not happen enough, frankly, and it is a great

opportunity. and i can talk to john hickenlooper about common goals that we have for colorado in north dakota. 98% of what we talk about we're going to agree on how to go about it, and so we have a form here where we can simply talk policy. we believe that policy is powerful. it really is what creates, resolves. mary fallin was a chair of our national lieutenant-governors at one time -- as was i -- and we are still believers that if we talk to each other, we can solve problems together, and it is something that is rarely seen in public these days, but it is still lives. >> we think washington can learn a few lessons from the governors. [laughter] >> you said it, i did not say it. [laughter]

>> i agree with that. >> we all agree. >> thank you, i appreciate it. thank you. [applause] good job. >> it is a pleasure to be on the roster with you. >> next, the first session which focused on education and workforce training.

this is about an hour. >> where brad have so many of our governors here. thanks for coming. thank you for your participation. i am mary fallin. i also have alongside me the vice chair governor john

hickenlooper of colorado. we have had a great time working together and we want to welcome you to the annual meeting. the first thing on our agenda is a motion for the adoption of the rules of procedure for this morning. part of the rules require that any governor who wants to submit a new policy or resolution for adoption at this meeting will need both to suspend the rule. if i could have a motion for adoption of procedures of our meeting in a second, i would appreciate it. i hear a second. thank you very much. second. i call for a vote. all those in favor say aye. all those opposed say nay. the rules of procedure are adopted. if you have any other proposals he would like to submit, you need to submit that to the nga staff by 5:00 p.m. tonight.

i would like to recognize our white house guests that have joined us from the office of intergovernmental affairs. not sure if they are here yet, but they will be joining us. david agnew, from the office of intergovernmental affairs. welcome, good to have you here. we have a very significant number of guests from our international friends that have joined us at our winter meeting, and i like to take a moment to recognize dan. we're joined today by the governor. he is president of the national conference of governors of mexico. we appreciate you joining us today. he's president of the national governorates -- governors of mexico.

also joining us is the mexican ambassador. ambassador, good to have you here. a representative of mexico's national governors too. we are also joined by our canadian longtime friend. i here today? ambassador, good to see you. he also has a delegation from the canadian-u.s. group. welcome to our canadian partners have joined us here today. we appreciate you coming to mac. -- too. i know we have some representatives from our brazilian and chinese embassies that have joined us, our friends from brazil and china, please stand up.

we appreciate you joining us. getting a lot of great new friendships and partnerships from around the world. and i became the chair of the national governors association last august, i begin working on what is called our chairs initiative. it is a year-long process in which we began to formulate some type of initiative that republican and democrat governors can support what it is important to all of us. i chose my initiative this year, called america works, education and training for tomorrow's jobs. it is something very important for all of our governors. creating opportunities for our fellow citizens, growing a revenue in our state. the initiative is about making significant improvements to our education system and workforce training program, and to help better align those programs with the needs of our businesses and labor markets. i believe this issue is

critically important to our nation, critically important to our state as well as our nation's economic future. governors are uniquely positioned to be a person that can help foster, that can help implement stronger connections between the educational leaders and employers, because in the end the governors are the ones responsible for both public education and also economic development. we are the key to that. preparing america's 21st-century workforce, to be competitive is an issue that not only calls for national attention, but it calls for gubernatorial leadership. that is something i'm calling on all of our governors to take charge and work with us on. the initiative raises the awareness about the significant benefits to individuals, businesses, steady economies were in governors act to raise their population's educational attainment level and better align their education systems and training systems with the

likely future needs of their economies and employers. it takes good numbers. i wanted to share with you a statistic that i think is very important and relevant to not only for our states, but for our nation. nearly 50 years ago, my parents were growing up in my small town. 80% of the jobs in our nation's economy required only a high school degree or less. 50 years ago. a high school degree to be able to reach the middle class. today that number has dropped significantly and today that number is 35% of our jobs in america require a high school degree.

a huge challenge for a nation, and that is why it demands a gubernatorial leadership. what we know is that of these people in that 35% figure of high school graduates, two thirds of those people who have a high school degree in the workforce will make $25,000 or less. that is certainly not going to get them to the lifestyle we hoped they would have and the lifestyle they could have. a post secondary degree or some type of relevant work for certificate from a career technology type school is the new minimum to success for our future workforce. one that our employers need, one that our children need, one that are working adults need to be able to meet the demands of tomorrow's jobs. even today's jobs, emerging jobs in our nations economy, and be able to help our citizens gain

access to a middle-class life and the american dream. if we fail to provide our students and citizens of our current workforce with the opportunities to be able to successfully navigate to that post secondary education, we are going to limit our own people possibility to be able to achieve their potential and have a higher standard of living, which is important to all governors. through the america works program and the initiative, we have identified a set of actions that governors can take that will improve their educational attainment levels of their citizens, and help realign their education systems, and also be able to help employers meet their demands for the jobs skills that they need. there are four policy components we have outlined in our america

works program to help governors improve and better align their state education training program that will help not only our employees, help our students but also provide results for the industry that demand a talented, educated workforce. first of all, it starts at the top. it starts at the top with our governors articulating a vision, articulating a message about why it is important to be able to connect education and the workforce, and to be able to help our educational attainment levels in our individual states meet that minimum for a better educated workforce and skilled workforce. secondly, we have to have good data. we have to know where we're at today and where we need to be going in the future. we have to track our progress, and measure our results. third, we need to build partnerships between the private

sector and the public sector and to be able to get the results we hoped to be able to achieve. fourth, we need to look at our resources in our individual states. we need to be able to look at the resources, funding incentives, and to be able to support it and line it with our overall vision and individual states, integrated vision. we launched this initiative last august. since then there has been great support from both the private sector, our education community itself, and a great understanding as to why this is important to not only our states, but our nation in our international competitiveness. nowhere is this more apparent than when we have had our two nga region summits, and we

started out with one in connecticut, governor malloy was gracious enough. he was gracious enough to host us in connecticut. he has had a great turnout at other states and people who joined us from the governors a and other public elected officials and service members. and then we had one governor in new mexico, governor martinez. we appreciate governor martinez for hosting the summit. your last chance is coming up for the education and training summit in the great state of oklahoma. what a surprise. i'd like to invite all of you to join us. we have a big list of attendees that will be joining us there in oklahoma city. you will have a good time.

you're going to learn a lot of great information that will be beneficial to your state, go home with a to do list, be able to check it off and go back home and say, i'm focusing on jobs and education. i hope you will consider coming personally or send your team members to oklahoma, march 27 and 28th in our state. my priority for this initiative is to be able to provide the governors with examples, best practices and actual, tangible resources to be able to advance these goals. many of you have already identified these goals in your state speeches. to begin that, we want to deliver on that commandment. i'm pleased to be able to share with you today our first report of my initiative called america works. this is titled, the benefit of a more educated workforce to individuals and the economy.

now you have this report i your seat. -- at your seat. the nga staff, the governors various cabinet positions and states have worked very hard. you'll also find in this report not only the details of different things, but we're pleased to be able to provide you state specific data. we have been working very hard over the last six months to work with an organization that will help you get very specific drilled down data about your educational attainment levels, employers, the market you need. it's a one-page profile that provides this breakdown. it compares it with your educational attainment level with your current population compared to other projections about your workforce, and analytics -- moody's analytics

provided this. the educational requirements of your company's and your state. this is a roadmap for each of our governors to be able to utilize. what we find is that we have a mismatch, not only in our nation, but throughout our individual states between the supply and the talent in our state and what companies demand that they need in the years to come. it challenges us to provide our citizens with a path of opportunity to be able to work with our companies, to identify talent that can take those jobs. like many of our governors in this room, i will frequently talk to businesses who tell me i have job openings but i cannot find the employees to take the jobs, and i can invest more and grow more jobs, but i cannot find the workforce.

on the other hand, i have friends and equated and says he will say to me, i cannot find a job -- acquaintances who will say to me, i cannot find a job. it is an excellent report, and data we are pleased to share with each of you. we hope you'll take this data back home and that you will share it with your commerce secretaries, superintendents of education, chancellors of higher education. we are pleased to prevent this to you. it's an important discussion of aligning our students' education with the needs of our ever-changing workforce. we are very proud today to be able to entice one of our top ceo's of our nation to join us

in helping us lead this discussion with our governors, to hear from someone who is out investing and creating jobs and opportunity and innovation in our nation. it is jeffrey immelt, ceo of general electric. he's going to talk to us about the challenges his company faces when they're trying to find employees needed for their continued growth, and to stay competitive not only domestically but internationally. he will also lay out the opportunities he sees for the private sector and public sector to work together to achieve greater success for our citizens and companies. jeff is held so many positions so money global leadership positions. he he joined ge in 1980. those of us that are familiar with ge know that they have many divisions. we are thrilled that ge has an

impending new facility in the state of oklahoma, and energy research center. we have a lot of oil and gas in oklahoma. we are thrilled. you haven't heard that? let me have a little man from oklahoma named harold hamm, talk to you. we're joking. in the year 2000, jeff was appointed president chief executive officer at ge and has been named as one of the world's best ceo's three times, and has served as chief executive officer at ge, named america's most admired company. that was from "fortune" magazine. it's our pleasure today to have jeffrey immelt here from ge. let's give him a warm nga welcome to our conference.

[applause] >> thank you. it's an honor to be here today on behalf of ge. a lot of things i will talk about today are common across the business community. i try not to make this a ge commercial. because the history and the breadth of the company, i've met most of you in this room. thanks for the great work you do on our behalf in your states and that's really where the action takes place in our company, is on the ground and the locations we have. what i thought i would do today is put a little bit of the global context in terms of the economy, what's going on. then i thought i would talk to you ceo to ceo about investing to give you the context of what were thinking about, and take

governor fallin's challenge on competitiveness and education. on the broad economy, we are in a world that gets better every day. everybody wants it to be magically back to where it was in 2005 or 1997. the u.s. economy gets a little bit better each and every day. there is not enough jobs i would say the missing piece in the u.s. is capital investment by small and medium businesses, still lagging behind where you would like to see it at this point in the recovery. europe has stabilized. that is always good for the u.s.. ge is one of the biggest companies that does business in china. i would say the chinese economy continues to be strong.

we think the new government's reforms are positive. resource rich countries around the world, these are very important countries for companies that are multinationals. we think they continue to reinvest back infrastructure and things like that. from a business standpoint, we see slow growth and volatility. you have to keep investing to grow. this is the pattern we could be in for a relatively long period of time. it's not a magic potion that will suddenly make the u.s. go back to 4.5% gdp growth, although that is what we should be pulling for. ge is the biggest infrastructure company in the world, one of the biggest industrial companies in the world. we are $110 billion industrial company, $400 billion

investment, financial service company. we are one of the biggest patent issuers in the history of the country. we invest six percent of our revenue back into research and development. 65% of our backlog is outside the u.s. that's where the markets are. we have high market shares. you should think about us as someone who is punching around the world. we are the second biggest exporter after boeing. when we locate a facility in your state, it is to serve all the countries around the world. we have a valuable brand, the six most valuable brand in the world. we invest back into r&d, expenditures. we keep investing back into the economy and do that everyday. we have got 135,000 employees in

the u.s.. we have more than 200 factories in the u.s., and about 93,000 of our employees are in manufacturing and engineering. that has grown about 9% since the financial crisis. for every job we create in ge we create eight in the supply chain. we are very dependent upon small and medium business. we purchase $15 billion a year from companies less than $100 million in revenue. we are dependent on the extended enterprise system in this country. we have strong financial footing with small and medium businesses. that's kind of the tale in terms of the global economy. when you host us in your state and we are lucky enough to invest their, we think they can compete in any corner of the world.

we don't think the american workers in the u.s. take second fiddle to anybody. they can compete. for us, we have got about 50% market share of large cap. we will sell more in algeria in the next three years and we will in the u.s. last november we took $40 billion of aircraft engine orders in dubai, none from u.s. airlines. the biggest three locomotive deals are coming out of pennsylvania will happen outside the u.s. this year. we will sell more ct scanners in china than the u.s. that's the world we have to compete in. that's the context for the company in terms of where we are. that is the world. a play in every world corner. we think the u.s. continues to get better, but that's the backdrop. you got to make your own approach.

that's number one. what we're investing in and how we invest -- from an economic standpoint, that is incredibly important to the governors. there are three interesting things that are seismic changes. we kind of are living in the age of gas, the plentiful reserves of gas, not just in the u.s. but globally are opening up economic opportunities for my power standpoint and a standpoint of technology that will go in terms of creating new economic opportunities around the world as this plentiful gas plays out. and then transportation. we work with railroad companies, transportation companies on converting to natural gas.

we think this is an absolute game changer economically in terms of where the future could be. not just in the u.s. we do a lot of business in africa. all the technologies that are going to gassify the african continent are being invented in the u.s. today, and it will create jobs and economic growth here. we live in a new energy age, and one that is important to invest in. this notion of advanced manufacturing, this gets written about and talked about. we are a big manufacturer. the u.s. has never been competitive as it is today. we can make a refrigerator with two hours of labor. if you can make things with two hours of labor, you can make them anyplace you want to. the new technologies around manufacturing are significant.

newman materials, 3-d printing -- i could go down the list. to say from a manufacturing base, the country has never been more competitive that it is on a relative basis today. the third big theme i would talk about is just in the area of what we call the industrial internet. everybody here has a blackberry or an apple. everybody is on social media and facebook. a series of other technologies. that innovation will now be played in the industrial base. if you look at a jet engine, it has 20 sensors. it takes a couple terabytes of data every time it flies. there's going to be as many people who go to work around the industrial internet as are going to work around social media. that will not necessarily take place in california or new york.

that will take place in pennsylvania, michigan, lots of places around the industrial belt. really as of jobs will be created around the industrial internet as time goes on. advanced technology, these are things to invest in. in each one of those we are putting our money where our mouth is. in gas, we have invested in gas research and development centers, new technologies, r&d capital, and we plan to lead in that advancement. not just in our balance sheet, but how we make and design technology. have a big research and development facility going into oklahoma city. we opened up of four or five new manufacturing facilities every year. our model facility is 500 people, because we think that is a size big enough to have scale.

it is small enough that they can be self-directed, where the employees call the shots. we do four or five of those every year. we have got 1500 engineers in california who work on the industrial internet. we made big investments in building engineering centers that allow us access to data. the last thing is something we're doing in louisville. we partnered with a company called local motors, which is a start of manufacturing company. we allow entrepreneurs to come in and design on our appliances. they can reduce cycle time to make these new kind of maker movement companies. they are all over the place and can be done in any one of the states to help go forward in the future. we have got investment behind the big three initiatives, and

we think they will reshape our companies and the economy going forward. the other thing about to talk about is in the area of investment. we probably make 15 or 20 important new global investments every year. we're working on five right now that will happen in 2014. we will have an aviation assembly plant that will build engines. if you're in the aviation industry, god has been good to you. we have a ten-year backlog. it's a great business to be in. we're going to build an assembly plant. these really create a whole portfolio of companies. we're going to have a plan to consolidate our activities in energy management, and put them into a state of the art any factoring facility.

both those sites will be started as a couple hundred units, a couple hundred people, and grow to 500 over time. we're investing in the best manufacturing lab anyone could build. we want to own that space and invest in a way that can attract other companies to come, and this is huge for us. we're going to do that around a university somewhere. when of the big trends in business today is to unify what is called shared services. to invest more in r&d, i have to cut my administrative costs. one of the ways you cut administrative cost is you can locate in your back room in locations. -- co-locate in your back room in locations. we are going to invest using both our capital at our strength to take a big gas project and turning it into fuel, and building a transportation system around it so we can demonstrate

what is possible from a standpoint of gasification. these are just five on the ge hit parade in terms of how we think about it. we would go to 46 states on each one of these investments -- four to six states on each of these investments. ge, when edison started the company, we grew up around fundamentally the 1870's. we were in upstate new york and now we can go anywhere in the country. we have a whole different world today. each one of these will go to four to six states and meet with the economic development people first. we love it when we can go to your states and meet with one group who can answer for everybody, who can answer completely on the economics, the regulatory, the speed.

when you can deliver on that that is a massive competitive advantage. we love universities. we love building around great, high-class universities because that is our stock in trade. that is how we can reinvest. universities are key. talented and hungry workforce, people that like working for a living and want to be a part of a facility. when we go, we go for 50 years. we're not going for a year or two. the lifecycle of a jet engine is 25 years. you are not going there just to pick up something and leave. and then the economics are important, for sure. as much as the symbol for what the long-term relationship will be like with the state, as much as -- if we do a big assembly plant on jet engines, we might get $15 million from the state.

this will be here for 50 years. it is a way to get started and mitigate some of the risks. those would be my pieces of advice on how we invest. the world is all about competitiveness, number one. number two, we continue to invest and we like working directly with you. i have a great team of people that do this. there's not one thing that happens in the u.s. that i don't personally approved, or anywhere else in the world. we speak as a company every time we make an investment. that is a little bit to set the backdrop. i was honored to work with 25 other folks on president obama's competitiveness and jobs council.

it made me more aware of competitiveness and job creation. i learned four things on that counsel in terms of what has to happen to create jobs. i have seen this time and time again as i have traveled the world. every country and state i have been to -- there's a shortage of jobs every place you go. there's no place that is happy with the amount of jobs they have. without infrastructure, it's hard to build competitiveness. you have got to have roads and ports and airports and broadband and all those things. the importance of small and medium enterprise. a and medium enterprise are important. i got a chance to see how difficult we make their life and how important it is that they have a way to compete. for every job at ge there is

eight in the supply chain. if you can create a multiplier in your state, that is how the jobs get created. the importance of regulatory reform. i'm a business guy. most business guys don't like regulators very much. that's a decision by people. we like high standards. there's no reason it should take seven years to get a transmission permit across state lines, when the touch time is like three months. the sense of accountability and transparency around regulations is something that you see in different countries and states is important. if you are easy to do business with, you will get more jobs. the last piece we saw, working on the president's counsel, the importance of training and education.

if you went on she's employment site, there are 2000 open jobs in the u.s. -- ge's employment site, there are 2000 open jobs in the u.s. to echo what governor fallin said, the business roundtable would see five things. stem. we have got to get math and science back into our schools. we are being in the 20's in math and science is a tough place to be, and there's not one job in our factories that you could look at that isn't automated or need some basic analytical skills, and we have fallen way behind. our focus on stem is important. that is where the ge foundation spends most of its money. we go into ge towns and try to

change the curriculum of education and focus on math and science in education. we believe in high standards. it's a little bit controversial on common core, but we believe in high standards as we look at what we do. i stand with the business roundtable on that activity. community colleges. if i go to a state and a governor can describe how many welders they prepare every year, that's a good thing. that means you can step into a manufacturing base that is incredibly ready and important. people are retiring, from the standpoint of the oil and gas industry and other industries. you have a real vacuum. community colleges do that. we partner with local community colleges that are training people during the day. they go to school for four hours and ge for four hours.

if you as a governor can say this is my community college plan, that is huge. if you have a dream of people that are going to probably find jobs in the 21st century, it will be engineers and welders. engineers are incredibly important trade they create jobs -- important. they create jobs. a good university is incredibly investable. this is where we like investing. when i go back to the things i talked about on the age of gas advanced manufacturing, probably on each one of those things we will partner with three universities each to have multi-year, multimillion dollar research and development programs that can create their own funding and their own jobs as time goes on. leveraging your universities is important.

how do we get veterans back into the workplace? we have made a commitment to hire 1000 veterans every year. we were joined why other companies -- by other companies. how do you translate veterans, coming back, what they've done in the military to what they can do on a factory floor. all these facilities that of "last few years, half of the new employees are veterans coming back. as a governor promoting the big company, small-company integration. finding ways and forms that allow big and small companies to train together is really important. we need that skill base in the small and medium enterprises. that is very important in terms of where and how we invest. if i would give you on education, it is really stem community colleges for advanced

manufacturing. have the universities front and center in terms of how you invest in where you invest. have a plan for the veterans are coming back to your state. have some governmental institution allow big companies and small companies to integrate in clusters or other activities. you can grow and create jobs but you have to compete. that is the watch word on the global economy. business and government have to work together. we invest roughly $12 billion each year in r&d, we do it around big themes, we do it around different locations. education is extremely

important, mainly around math and science. last i would say, thanks for the great work you do. the states give us a platform in which we can compete. you are the entrepreneurs in government. you can get things done. i hope you utilize that, the chance to try new things, and utilize your state to try new things in health care and engineering and education. know what is investable in your state and make that apparent. what are the big investing themes. that allows us to get plug-in. i may ge guy. -- plugged in. i'm a ge guy. it's a small businesses that need the most help. as a country, we talk about small business every day, but we

make their life to hard. as governors can embrace 100 or 200 medium and small businesses, they give you the data you should need everyday on health care or education or things like that very that's really important. let me end there. governor fallin, i'm happy to take questions. thanks for helping us compete, and we want to make you proud in terms of how we do in your states and what we do in the future. [applause] >> thank you, jeffrey. great comments. my first question was going to be what governors can do to help you address the challenges you laid out. you gave us all the different points we need. i might ask you, what do you think employers would be willing to bring to the table to work jointly with the governors to have you accomplished these

challenges. >> if i just talk specifically about education, there's probably not one company or one big company in the country that doesn't have money spending it education. i think every company has its own best idea. we get fragmented too easily. maybe the governors could say, this is the way ge could really help in this state, because we have other companies going in the same direction. we need a little bit of a focus as it pertains to how best to find education. we spent as a company probably $150 million a year on education. but our focus is on stem. but maybe we could do a better job in your state. i have traveled the world a

thousand times over. we do business in 170 countries around the world. there is no country in the world that has the university system the u.s. has. if you have to say what are two or three of the biggest competitive advantages this country has, the university system has to be at the top of the list. i'm not convinced we do enough to leverage the great universities we have. we are a scale employer. we go to the big 10 schools and big engineering schools are kind of what we see everyday. they are awesome in this country. how you build around the schools -- i can give you the stanford example. what stanford is done over the past 30 years is unbelievable, but it's hard to find the next university that can lay claim exactly the way stanford can. >> i know everybody is always

asking you for something, but since you indicated you are investing a significant amount of money annually in education since you're talking about the need for having some states point out some things you can focus on to achieve better results, i want to point out what another major corporation has done. i do not think they are competitors of yours. that is exxon. they did not do it all across the country. they picked six states and invested significant sums of money in advanced placement courses by actually rewarding both students and teachers monetarily for participation in advanced placement courses particularly in stem. the achievement of those proficiency scores in those tests. in virtually every state --

there was a pretty good cross-section of states -- virtually every state, we have seen marked improvement in both advanced placement class participation and in this course. it has been particularly good in math. english and science, but math and particular seems to have generated significant higher increase in participation in advanced placement courses and in this course. as you are thinking about where you will invest in the future, it sounds pretty small. i think they give $100 per student per course, per grade per year. if you're sitting there any go from 10,000 kids in advance but the 240,000, it has brought into a point where your pool becomes bigger. and investment of 10 million or

$12 million and several states can generate the kind of results that would help our students and our global competitiveness. as you are looking for future opportunities, which are arty going to invest anyway, that works. >> we do big rants. we sign an agreement on what is going to happen. we have one of these in stanford. we can do it in seven or 10 towns.

had we get a multiplier? it is how do you take a few of these and get them to multiply more? we have skin in the game. we needed and wanted to be successful. how do you make one plus one equals three. >> thank you. let me thank you and ge for your investment in kentucky. you are restoring job and product. that is exciting to build advanced manufacturing right here. secondly, we like to take you to lunch. [laughter] thirdly -- you got my interest. all right.

let me ask about apprenticeship for grams. i have traveled quite a bit with these countries. you see a different structure in high school where kids are able to work in a plant, go to school, be paid and earned certificates and skills that didn't let them go right into the work force. i know germany is set up like that with their educational system. what do you think of that approach for the u.s.? >> first, i'm going to circle back and say there is cynicism and questions about manufacturing. i would say it is real. we used to have 25 jobs in the united states in manufacturing.

now it is about 10. can the jobs grow incrementally? can they be more it? it is what every country around the world wants. it is where middle-class jobs get created. this is where you get the manufacturing. do not give up about it. let all the other people talk about it. i would say that having this ledger which does this leverage between high schools and community colleges and for the governor to have in mind what the jobs are for your state and i.e. prepare people for those jobs is really important. we talked about new york city. 400 people go to work every monday in the hospital system. why don't you take the senior year of high school and train

people to be radiology techs or physicians assistants and start that in school. on the global stage, germany is the best. five years ago the president of the non-said they would graduate 5000 welders every year. i've thousand. we needed to do a plan. we put it in this. it is an awesome workforce. this is hard to do. it is an awesome workforce. that is a way i think governors can say what is happening in kentucky. i would say kentucky has a manufacturing renaissance. there is a lot of skilled labor that will have to go in there. that ought to be what the community colleges do.

>> thank you. we appreciate you being here today. thank you for your public service. it is good for you to help us try to figure out a way to create jobs. money ask the question differently. most of us came into office at the throes of the great recession. i think for a lot of us the progress has been sluggish. we have not seen the economy expands. it has been a tepid recovery. i have heard a lot economist to give us their theories as to why. what has been the cause of the slow recovery? what should we be doing to make sure it accelerates? >> i can only describe what i see. you basically have a deep

recession, these tend to be sharper and are harder to recover from. you have to delever at the same time. this is still anemic i any standard. if you look, consumers are taking on leverage again and investing again. that has happened. >> people talk about big investments. i can say to boeing i'm not going to invest because i'm concerned. we had to keep going. this is on the sideline. we saw on the fourth quarter of

last year, the first time the net new investment was crawling. that is what we have to solve for. how do we get capital expenditures? economy is growing 3% a year. you have to have new company formation. it will have to start building factories and things like that. it is the small and medium businesses that have not really come back up from an investment standpoint. you have a super tough comment. i would have 200 small and medium businesses. i would be with them all the time. what is this lease this? that is the power not back in this. >> thank you for being here. jeff was the first ceo to show

up their 21 years. the state is still talking about it. thanks for joining us. >> you have to get out more. there. i want to go back to the education link. at that we all share this. this is a place that seems to me we can really partner. i know my challenge in vermont. is that even while i have the best graduation rate in the country, where i am losing the battle is moving kids beyond high school. first-generation low income kids. if we look at jobs in our future and we do not do a better job there, getting them in the tech programs, getting them excited about manufacturing and so they can run the machines, is there a

way that we could partner? there are internships. you got a job. it will be nine bucks an hour. is there a partnership there that we could really focus on? it would be first-generation kids who we know we need to succeed. >> getting the kids in inner city schools to get them to study math and science. so people can come and walk

there and aviation plant and say this is neat. we are retooling and re-launching our programs. these were extremely and officials in the 50's and 60's. the third thing is that governors can link up the demand. let's look at rutland. you want to be training more than 30 or 40 or 50 people that we might higher each year. the only way to do that, you've

got to get small business in the same camp. one of the things you can do is say here are 500 people in vermont but we're only going to take 50. any to find other people. >> i appreciate your comments about how it needs to get into the preschool and grade schools and what not. if we can get enough high school graduates getting the trained. pressing on middle school in preschool issues. if we can keep those kids moving forward, than we can provide you much more of what you need. my question is around the labor cost. larger organizations continue to say they develop relatively small.

one is the level of investment per job and technical robotics. the second is, yet kind of use the last decade to clear some of the larger obligations off of the balance sheet, moving the pension systems. the smaller businesses are a little behind in that regard. the wage rates are pretty low. they are worried about things that you cleared out. it is amazing. you go to a ge or boeing facility and you go to your suppliers and you see they need to invest. if they do they can be much more competitive. are there some ways to use advanced manufacturing leaders to assist these? it is stunning to us as to which

ones are going to be successful and which ones are not. the ones that are not being successful are the ones that are paying the lowest wage rate. it tells us i cannot find a people to work 10 bucks an hour. how do we get the competitive wage rates up while keeping the cost structure competitive for the smaller and medium-sized businesses? >> i would urge all the governors to, there is all these entrepreneurial manufacturing businesses coming up. the one we have done is local motors. this is based only an entrepreneur who fundamentally goes in and says here how i can

do a dishwasher in six months. he crowd sources the manufacturer. i would get something like that in all of your state eared that way you get this entrepreneurial spirit that opens up the door. i am not going to get into the health care debate in this town. i'm going to stay a little while in may. it is a total cost of work. the extent to which you think it entrepreneurial activity going on, for us there is 15 towns that are the preponderance of ge retirees and employees in the united states. the cost per employee is like 50%. i think we are pretty typical. if governors can now look at this as a local challenge, but find ways to make that it helps them make the right trade-offs.

to the extent they can look at health care and education as being things they can help them with. then that allows for more value of the employee. that is what it is all about. >> you are stirring up a lot of questions now. i have about four people wanting to ask questions at about two minutes left. governor walker of wisconsin. >> just a quick request. we talked about worker training. we put a lot in our technical colleges. you said something in particular. you mention the high school welders. we put 100 million in the budget last year to drive down the waiting lists. one of our challenges in areas like that is there's not enough young people going into the

areas during it is not just the s.t.e.m. one of the challenges in wisconsin, highly skilled employees of ge health care look at our kids wanting to go to a four-year college or university. one of the challenges we need to do is to help us spread the message that is just as important and we should be just as proud of our sons and daughters that choose to be high skilled welders as those who choose to be attorneys and doctors. we need leaders and parents. a lot of your professionals of wisconsin can help us do that. >> for the first time in 25 years, the most popular on campus program at ge is the manufacturing leadership program. we had 20 years word was not very sexy. it has now become the most popular thing.

i think we're seeing a change in community colleges and schools as well. >> thank you for being here and sharing your thoughts with us. thank you for being a great corporate citizen and the state of connecticut. i do not realize we were running out of time. i was actually going to ask you to comment on the environment, climate change, and what you guys are doing to prepare and what you are doing to make money. >> we as a company starting in 2005 basically have run the company through our greenhouse gas emissions. we have invested in clean energy. we have been an investor and super efficient jet engines, gas turbines, wind energy. our view is always one of a balanced economy that basically

there is going to be one that will drive economics. the new jet engines that we are volleying for our 25% more fuel efficient. at the same time, wind turbines a decade ago was 25 something kilowatt hours. the most recent ones have gone on at five cents a kilowatt hour. we think it will drive solutions across a broad range of different industries. we run the company with that as a principal. we're going to have our own assumption that says we're going to reduce our own greenhouse gas emissions. we're going to innovate around it. it creates more jobs. it is an interesting world we live in. as an american mile age, i learnt energy policy going to

year. now they have 50 gigawatts of solar. they are importing coal. you can get sideways sometimes based on how the policy and the technology meets. >> one less question. >> thank you. thank you for your presence in puerto rico. my father used to work at ge in the very poor side of puerto rico. what does ge expect from a public university? >> i think it is the differentiator. i think today is, again, i am a different case. when we do a facility, we are thinking about 40 or 50 years.

we are not thinking about six. it is the nature of the products we make. if you're making an investment for a long time, and the schools are number 1, 2, and three. quality universities. it is just the way life is. we've got a big huge presence in wisconsin. we have been there since 1950. it is the nature of human beings. if they like a place, they want to say. knowing how good the schools are and having a belief that they can scale. we know oklahoma and oklahoma state are awesome schools when it comes to investing in were the future is going to be. i hang it is a dominant number one.

i think it is a dominant number one. thank you very much. [applause] [captioning performed by national captioning institute] [captions copyright national cable satellite corp. 2014] >> coming up, washington journal with the latest news. after that "newsmakers" with lorraine miller. then live coverage of the national governors association annual winter meeting in washington, d.c. next on "washington journal" we will hear from the iowa governor, who is attending the nga winter meeting. he will talk about his states priorities in 2014. after that the president of the service employees international union. she discusses the issues facing labor unions and the workers they were present.

then a look at the u.n. report on north korea, which accuses the country's leader of committing crimes against humanity. john part of the u.s. institute of peace will join us. "washington journal" is next. ♪ host: good morning. it is a back to work week for congress as lawmakers return following presidents' day recess. the nation's governors are in washington for their winter meeting. tonight they will be at the white house and tomorrow the president will address the governors. this is also a root -- a weekend of fast-moving developments in the ukraine as the president attempts to please the country. a political transition is now underway in that country. on the sunday morning, february 23, we will begin with an issue that many states are now debating.