Exclusive Interview: Gov. of Pennsylvania

Raising the bar for better results

Before Governor Edward Rendell of Pennsylvania retires from office next fall, he took the time to tell ABJ how he is using every day he is in office to the maximum to push for better quality of education for women and minorities in the state. Read on to find out why he believes investing in an alternative energy economy and an infrastructure revitalization program is key to laying the groundwork for a solid recovery.

ABJ: You passed a responsible budget with plans to make big sacrifices and it is very stringent. How do you promote and communicate that this is a neces­sary evil to your public?

Gov. Rendell: That’s a very good question and interestingly, I’m not sure we did that as well as we should have. But I think we have been doing better after the fact. What I try to do is make this as simple for the public to understand as possible.

In the past fiscal year, Pennsylvania lost $3.2 billion in revenue and we’re not gaining that back this year. We predict zero growth this year—we’ve actually had negative growth in the first four months—but we believe that some growth will return to Oval office over the rest of the year. When you lose that amount of revenue, obviously you have to do two things:  make cuts to your budget (and that means eliminating a lot of programs), and raise revenue.

In other words, I explain the budgetary situation to constituents like this: consider Molly and Joe Smith. They are a married couple with two children, both earning $50,000 each per year. Joe, to no fault of his own, loses his carpentry job because his company closes its factory. The family household income goes from $100,000 to $50,000. The first thing the Smiths try to do to is cut out everything that is not related to the core needs of the family—no mov­ies, no summer vacation, they defer buying a bigger car, defer getting a new water heater—they cut all expenses to the bone. Yet, they still can’t make up for the $50,000 revenue loss so, Joe, a skilled craftsman, goes to work bagging groceries at the local store making $16,000.

That’s a humiliating thing for a skilled trades­person to do, but the family tries to do everything to raise the household income. That’s the problem that Pennsylvania is in. We cut $2.5 billion from our budget, but that still wasn’t enough. We need to raise over a $1 billion of new revenue. That’s why we expanded gaming and additional cigarette taxes, as well as expanded corporate franchise tax, in order to balance our budget. We were just like the Smith family.

ABJ: With the consumer pricing index and jobless rate on the rise, how do you support and facili­tate economic development in your state?

Gov. R: The state  is in relatively good shape [with regards to unemployment]. Pennsylvania has an unemployment rate lower than the national average over the past 72 out of the 73 months at 8.8 per­cent (the national average is 10.2 percent). Most industrial, large states are at 12 to 13 percent.

The reason for this is because in the past six years, Pennsylvania has made varied invest­ments in its economy that fall under different cat­egories:

1) We’ve been improving the infrastruc­ture for doing business, so we’ve been giving local businesses money to clear sites in order to put in infrastructure—waterlines, sewer lines, rail tracks etc.

2) We put together some capital in­vestment guarantees and venture capital funds. We’ve just been named by the Venture Capital Magazine in its survey as the third highest state in the creation of jobs from such investments.
 
3) We’re ahead of the curve in promoting alterna­tive renewable energy development. Those are three key pluses for our local economy.

ABJ: Following that thought about energy inde­pendence, or alternative energy economy, how has that created jobs?

Gov. R: We’ve created about 10,000 good-paying new jobs in the green energy sector. And I think that’s just scratching the surface. I think we can create as many as 70,000 new jobs in the next five years. We’ve done that by creating a market for renewable alternatives by passing two forward pieces of legislation, which are:
 
1) Advanced Energy Portfolio Standards (AEPS). Although we were the 23rd state to do that, it is one of the most aggressive AEPS bills out there. What AEPS bills do is document in what timeframe—in our case, by 2019—the utilities must use at least 20 percent of the energy that they sell to us, hom­eowners, commercial and industrial businesses. All of which must include alternative energy sources, such as wind, water, solar, hydro or geo­thermal. That standard mandates the need for production in alternative renewables. It is then much easier to invest in the growth of alternative renewable, when you know there will be a grow­ing market. That’s very important.

In Pennsylvania, we produced 158 megawatts of energy before we passed that bill, and the sec­ond largest company in the world came in. We saw a 10-fold increase in energy production with just one company. Creating the market is very impor­tant. We did the same thing for ethanol, methane and biofuels by passing legislation that states when distribution reaches a certain level, by 2014, that one billion gallons of fuel at the pump in Pennsylvania must come from renewable—cellu­lose, ethanol, biomass and the like.
 
The second thing we did was incentivize the development of alternative energy companies. We put in $1 billion into the sector’s growth over six years, incentivizing those companies and we just passed another bill that will help us cre­ate another $650 million to help incentivize the development of those industries. That bill also calls for conservation; the utilities had to reduce consumption by three percent and those energy conservation efforts will also go into creating new jobs. I think the green economy is alive and well in Pennsylvania and it will grow exponentially in the next few years.

ABJ: What is currently on your iPod?

Gov.R: I don’t have an iPod but my wife bought me a Kindle for Christmas. She’s pretty much appropriated it and uses it much more than I do [laughs]. The problem is that I don’t get much time to listen to music. I do 30 minutes on the treadmill almost every day while watching TV. I do like country music, so I tend to watch CMT. Unfor­tunately, I don’t have much time for music or to read because I read so much other material. I did read A Team of Rivals; it took me a good part of eight months to finish it.

ABJ: Any plans for what you will do next after your last term, Governor?

Gov. R: I haven’t given it much thought because I’m concentrating on using every day as Governor to my maximum. Generally speaking, I want to ex­pand what I do in a small slice right now. I teach one course at the University of Pennsylvania.  I do the post-game show on SportsNet, so I’d like to do more of sports radio or television because I love it and it’s relaxing. I also want to stay active in building America’s future, which will be with the infrastructure organization I started with Gov­ernor Arnold Schwarzenegger. That is because I think there is a desperate need for the country to have an infrastructure revitalization program. Finally, I’ll probably do some foundation work and advise companies in a law firm setting. That is, how to navigate through the governmental maze. But no lobbying though. All of these things I en­joy, so in part, it’s all to keep busy.

ABJ: You mentioned that you teach at the local university. Can you speak to your commitment to education on a broader scope?

Gov. R: There’s nothing more important to the Commonwealth than continuing the progress we’ve made in education. Over the last six years, we’ve increased annual spending on education by $3 billion and that’s paid off. We haven’t given the districts blank checks, but we’ve in­creased spending in targeted programs in what we know work, such as full-day kindergarten, after-school tutoring, technology in the schools. These things we know have a dramatic effect on performance and results are clear: 30 percent more Pennsylvania children are both proficient in reading and math than they were six years ago. The Education Research Council in Wash­ington just released a report stating that Penn­sylvania was the only state to make progress in the national test —elementary, middle and high school. I am very proud of the accomplishment. We will continue to make gains and investments into the technology in our schools.

ABJ: You were quoted saying that Pennsylvania doesn’t get due credit for some of its accom­plishments.

Gov. R: Yes, the legislature gets so screwed up in the process of passing laws. The budget we passed this year reduced state spending by $2 billion; it had no broad-based tax increases and it preserved the education funding, as well as healthcare and economic development. It was a very good budget, but because it took so long to pass —101 days after the budget was due—nobody focused on the substantive value of the budget. Everyone just focused on the delay and the inability for everyone to come to a consensus for a budget. It’s the perfect example that we are own worst enemy.  

ABJ: Sometimes, as you know, it takes a while to get good things happening and part of that is due to the overall process present in govern­ment. How will you be promoting and facilitating momentum to make a meaningful reform in the next year?

Gov. R: I think it’s necessary for me to go around the state to speak about what we’ve done, what is left to do and how a reform must be a part of the state. I think I am an even, credible messenger.

ABJ: State figures show that more women will be entering the workforce over the next two years.  In what way will be you supporting women and minority groups in being able to excel in their fields of choice?

Gov. R:  First and foremost is to prepare them well, and that’s why our investments in educa­tion are so crucial. We need to prepare all of our citizens, but particularly minorities to compete in the workforce. They can’t do it without a quality education. That’s job number one. The second thing I want to do is look at things that help mo­tivate women to get into fields that they haven’t been seen in a lot before. If you look at a medi­cal, law or business school, the entering classes are at least 50 percent women, sometimes more. But if you look at an engineering school the percentage is 15 percent women. You look at a math PhD program and it’s four percent women. You look at an advanced science program and it’s close to 7 percent women.

We have to get more women interested in the general sciences, math and engineering at an earlier age. We have to get them excited about it, but also, we need to get the message out to them that there’s nothing effeminate about pursuing those professions. Right now, when it comes to science, math and technology, we’re fighting the battle with one hand behind our backs because women are just not participating to the extent that they should. In the field of entrepreneurship, the [participation] rate is very, very good. In my six years as Governor, we’ve increased the participa­tion and that means women own their own busi­nesses and run businesses in two percent to 10 percent of all state contracts. The state gives out about $4 billion in contracts every year, so that’s a very meaningful statistic.

ABJ: Those are encouraging statistics. Thank you for your time, Governor.

Gov. R: My last day in office is next fall, but, feel free to keep in touch.

By Antonia McGuire

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