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ly hurts lower-income people, and we ought to be doing something about that, too.

(Governor Huckabee nods affirmatively.)
Mr. HORN. I take it you are nodding that we
Governor HUCKABEE. I think it is a great idea, absolutely.
Mr. BURTON. Mr. Horn, we all agree with you.
Mr. HORN. Good.
Mr. BURTON. Mrs. Morella.
Mrs. MORELLA. Thank you.

We are honored that you appear before our committee, Governor Huckabee. You know, I used to represent in their home away from home both Senator Bumpers and Senator Pryor, and I want you to know—they are no longer there—but I want you to know you are represented by some great Members of Congress. You have got one sitting right next to you, to your left, Jay Dickey. He is a real admirer. He talks about you often—and Congressman Hutchinson, who was here, who represents as well. So I want you to know that.

I am also on the District of Columbia Subcommittee, and I just had a meeting earlier today talking about the possibility of tax cuts for the District of Columbia people, since we have been doing a lot of revitalization quite successfully. Their income tax is among the highest in the Nation. They have like five different levels of corporate tax. And they have a surplus. So it sounds like it has got the right environment for it.

But I asked then a question I would ask you: Where does the opposition come from? The answer I got: Well, you are going to have those groups who say you need to put more money into health. You are going to have those groups who are going to say you need to put more money into education. Instead of giving tax cuts, let's spend this money on something where we can see some effect that would be beneficial for the public.

Now I want to ask you before my first question within a question is: Where does Arkansas rank in terms of the per-capita expenditures on education?

Governor HUCKABEE. We are 50th.
Mrs. MORELLA. I thought I heard you say that.
Governor HUCKABEE. Yes. That is correct.
Mrs. MORELLA. That is why I picked up on it.

Governor HUCKABEE. Right. We are 50th in the amount of money that we spend on a per-pupil basis. So our State has a long way to go in terms of spending. Now the good news is that we are 32nd in terms of our overall academic results-proof positive that it is not just money that equals good education. It is good, dedicated teachers. It is a disciplined environment in the classroom. It is a good curriculum. It is the parental involvement. And it is, I think, a lot of local control at the school board level and the campus level. All of those are important factors, as well as how much money flows to the student.

I think we could all look at surveys that show that some school districts in which the expenditures are extraordinary don't produce academic results that are better or even equal to other districts who don't have that kind of money, but they do have the strong sense of parent involvement. They have a strong sense of discipline in the classrooms.

ance.

Mrs. MORELLA. I agree.

Governor HUCKABEE. So I think while I would certainly want, and one of my goals as a Governor, quite frankly, is to make before I leave office, Arkansas is no longer 50th, and we have increased education funding, and I want to do it more. But I don't think there is a conflict between that and being able to also cut taxes.

Mrs. MORELLA. Did you hear from like the teachers' groups and parent groups about that?

Governor HUCKABEE. We heard from the teachers' union about that. Certainly they were apprehensive about tax cuts, and there were other providers. Quite frankly, Congresswoman-and I know you know this very well, as I do, because of your position—there are a lot of people who make a lot of money off the governmenta lot of money off the government. And a lot of people who are the so-called advocates for the poor and to help end poverty really understand that their living comes off of making sure there is enough poverty out there to give them a job.

Mrs. MORELLA. It is kind of a balance; that you are the one who is the leader in terms of making sure that you do have this bal

Our chairman has been pushing very hard something we call the Government Performance and Results Act, which does that very thing. It says, OK, can you tell us not only what your mission is, but what are you doing to prove that you are reaching those goals? That is the kind of thing that you are saying.

I would ask you, did that 32 percent occur while you were Governor? Or has this been happening in terms of performance

Governor HUCKABEE. That is the most recent figures. Our academic performance is up. Our level of remediation is down. Those are two good indicators that we are doing some things right.

What largely we have done is to refocus on the beginning of an educational environment with a program called Smart Start, which is a K-4 initiative to ensure that students get the right start.

But you mentioned some other areas of efficiency. We have implemented cost-based budgeting or activity-based budgeting, which has made a very important in-road in actually determining the cost of what government is doing; performance-based budgets, which is something we have implemented this year. And we have got a citizens' commission called the Murphy Commission, headed up by a south Arkansas businessperson, and headed up by a blue ribbon panel of business and civic leaders, all outside of government, whose job it has been for the past 242 years to go through every single agency of State government and make recommendations of how we could downsize, make those agencies more efficient, utilize technology to be more capable of better managing the resources they have.

As a result of that, we have an independent audit structure now in place in our government; the activity-based costing; performance-based budgeting, and a new program called Career

Ladder Incentive Program for Employees, which gives people an incentive for staying in State government, but not just for physically being there, but for actually performing and being graded on objective levels of their performance.

Mrs. MORELLA. I am sure you have probably had job training in terms of technology and education also included within your program?

Governor HUCKABEE. That is correct.

Mrs. MORELLA. I know my time has expired. I want to congratulate you on putting into effect all of those elements. Thank you.

Governor HUCKABEE. Thank you. Mr. BURTON. Thank you, Mrs. Morella. Congressman Terry. Mr. TERRY. Yes, thank you, Mr. Chairman. Governor, it is nice to meet you. My sister is a resident of Rogers, AR. She has lived down there for about 15 years now, her and her family, and mentioned supporting you, and that they were thankful to have you in there now.

Governor HUCKABEE. You have a wonderful family, Mr. Congressman. (Laughter.]

Mr. TERRY. I thought you would agree with me on that one.

But I have got to tell you, one of the major issues—I am new to Congress, only been here 90 days, but one of the issues that concerns me most-and, in fact, was one of the reasons why I ranis what I thought were some questionable Federal policies, particularly in taxation areas, marriage penalty, one of my pet peeves. In fact, in a survey I did with my constituents, I found out that it was also one of theirs, too.

Congress or at least the House a year ago was able to adopt a measure that significantly reduced that burden on families where both parents work; couldn't get it through the Senate. But I am picking up on a theme here today with our Republican Governors, that they have been able to do the morally correct and just economically correct thing for working families, and that is eliminate the marriage penalty. I am sitting up here saying, we can't do it here, but the Governors in the States are seemingly being able to do it with ease.

Was it easy? Did you have opposition? Teach us how we can get that accomplished.

Governor HUCKABEE. Congressman Terry, while there was some opposition to any tax cuts, I think as it relates to the marriage penalty, in particular, that it was one of the less controversial items that we put in the package, in large measure because it is totally inconsistent-in fact, it is almost inconceivable that, on the one hand, we would encourage people to get married and stay married; to build strong families and raise children in the environment of a loving atmosphere, where they have a mother and a father who truly nurture them, and on the other hand, give them a greater level of taxation, and actually penalize them for maintaining a traditional family relationship. It is completely inexplicable and indefensible.

From a pure common-sense standpoint, even if the economics weren't so positive for it, I do believe this goes to the heart of what you said: It is a moral issue. We should not penalize people for maintaining a strong family structure.

It certainly has not hurt us. In fact, I think it has helped us, and it makes our State even more marketable to other people, as we say: It is a great place to live, and we don't penalize you for being married.

Mr. TERRY. Well, congratulations on accomplishing that with ease and building your coalitions. That is, I guess, our job here. Thank you.

Governor HUCKABEE. Thank you.
Mr. BURTON. Thank you, Congressman. Congressman Ose.
Mr. OSE. Thank you, Mr. Chairman.
Governor, good afternoon.

I have a couple of questions, and it relates to the cost of doing business at the local level and the taxes that might follow from Federal intervention and traffic congestion situations and land use planning. We have someone in the administration who appears to be running for President, but, more accurately, has a platform designed to run for mayor.

I am a little curious, from a tax consequence standpoint, what feedback you might give us in terms of the Vice President's mayoral campaign at the local level in terms of cost of government.

Governor HUCKABEE. I appreciate the question, Congressman. I would say as strongly as I possibly could, the best thing that you in Congress could do for us at the State level is to give us the opportunity to solve problems at the local level, and don't assume that they can be solved at this level.

With all due respect to all the Members of the Congress and to the institution itself, there is no way in the world that an urban planning program, an education program, a wildlife management program can be designed in a concrete building in this city that will be applicable and work equally well in Washington State, Miami, FL, or in Ft. Ise, AR. It simply can't and won't happen because every locality has a unique milieu of culture that needs to be addressed. And it is one of the principles that I think that many of us govern by, and that is that the best government is the most local government, because it is closest to the people being governed, and therefore, it is held accountable by those who are being governed.

Whether it is education policy, we would urge: Send us the money, not the strings. If it is urban planning, this is when we say, "Send us the moneywould be “This is money our citizens have coughed up. Return it to them and to us”—and to let those decisions be made at the local level. We honestly believe they will be better decisions because we in those localities have to live with them and are closer to what is desired by the people under that forum than anything else.

I appreciate your bringing that up.

Mr. OSE. Mr. Chairman, if I may follow on, one thing I have learned in the few short weeks I have been hereas Mr. Terry, I am relatively new-you referenced a concrete building here in the city of Washington, DC. I want to make sure we don't end up parsing that particular comment. Are you also referring to stick frame buildings, metal buildings, or any other kind of buildings? I just want to make sure that I understand the universality of your comment.

Governor HUCKABEE. Even if it was in a manufactured home, it would still be the same policy, yes, sir.

Mr. OSE. All right, so I can be clear that it is not the structure from which it comes; it is the fact that it originates here at a far distant point, rather than perhaps accommodating, as you said, the peculiarities or the unique circumstances of the localities?

Governor HUCKABEE. That is correct. I just haven't seen anything except the granite and the concrete around here.

Mr. OSE. Well, I have learned that I have to be very careful about how I ask questions, because people are very clever in how they parse the words. So I don't mean to imply anything relative I just want to be clear about what you were saying. So I appreciate your feedback.

Governor HUCKABEE. Point well taken.

Mr. BURTON. Well, Governor, thank you very much for your testimony and for your patience, and for being with us at the news conference. I can see why you were elected with 60 percent of the vote in Arkansas. You are a darned good guy, and not a bad looking fellow, either.

I want to say that you have a great Congressman in Congressman Hutchinson there. He has acquitted himself very well since he has been here. Congressman Dickey, on the other hand, needs some help with his basketball, and if you would talk to him about it, I would appreciate that. [Laughter.]

With that, thank you very much for being here.

And I hope the members will be with us in a little bit when Governor Gilmore is here.

With that, we will stand in recess at the fall of the gavel.
Thank you again.
Governor HUCKABEE. Thank you, Mr. Chairman.
[Recess.)
Mr. BURTON. The committee will be in order.

Welcome, Governor. We appreciate your patience. Why don't you just go ahead and sit there at the table?

We really appreciate your being with us today. Unfortunately, right now on the floor we have the census bill, which is one of our subcommittees, and so a number of our colleagues are down on the floor debating whether or not local officials ought to have the ability to participate in reviewing the census. So they will be coming in from time to time.

Governor Gilmore of Virginia was elected in 1997, promising reform of Virginia's burdensome car tax, and May 20, 1998, Governor Gilmore signed into law the phaseout of the car tax. Between 1998 and 2000, Virginia taxpayers will receive a refund of $435 million as a result of this reform. He has also fought hard to eliminate the sales tax on food, and just this year a repeal of 2 percent of the State's 4.5 percent sales tax on food was enacted.

He is also working hand in hand with business to create more jobs for Virginia, and he has set aside $7.2 million to reduce the tax burden on corporations with headquarters and major production facilities in Virginia.

And I recall, Governor, when you were running, as I said to you back in the back there, that when you said you were going to cut the car tax, I could almost hear the voters applauding; I knew you were in.

So welcome.

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