Governors Mediate Demands For Stimulus Funds

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As President Obama prepares to sign the stimulus package into law on Tuesday, governors in every state are dealing with demands for the stimulus money. Govs. Tim Pawlenty of Minnesota, Ed Rendell of Pennsylvania and Deval Patrick of Massachusetts talk to host Jacki Lyden about their plans.


From NPR News, this is ALL THINGS CONSIDERED. I'm Jacki Lyden.

Now that the legislative jockeying is over, the spigots of economic stimulus actually opened this week. President Obama plans to sign the $787-billion stimulus bill in Denver on Tuesday.

That same day, Detroit's automakers return to Washington, D.C., to unveil their plans for an industry makeover. That's part of the deal that General Motors and Chrysler made late last year to get billions in bailout money from the Feds.

The president's senior advisor, David Axelrod, appeared on NBC's "Meet the Press" today, and he said Tuesday's car hearings will be crucial.

(Soundbite of "Meet the Press")

Mr. DAVID AXELROD (Senior Advisor to President Barack Obama): We need an auto industry in this country. There are millions of livelihoods that depend on it, not just at the auto companies, but spin-off manufacturers, dealers and so on. We're going to need a major restructuring of these companies to build companies that can compete in the future.

LYDEN: Throughout today's show, we'll focus on economic survival from the writers who profiled the states at the depth of the Great Depression to the governors grappling the stimulus dollars and the bartenders who hear survival stories at the tap.

Unidentified Man #1: The first thing out of their mouth is, what do you have on special today, or what's on deal?

Unidentified Woman #1: The guys that come in here work at the salvage yard, and it's closing, and so they're all worried about their jobs and what they're going to do.

Unidentified Man #2: When someone comes in and sits down at my bar across from me, I know how bad things are, and I know that he knows how bad things are, and people are wanting to move on.

LYDEN: First, though, to several of the country's state houses, where all those billion-dollar checks sound like a governor's dream, but it's a huge job.

Just ask Governor Ed Rendell from Pennsylvania. That state, expecting about $16 billion from the stimulus.

Governor ED RENDELL (Democrat, Pennsylvania): I'm governor for two more years, and other than economic development, which is always the number one driving force for Pennsylvania. I'm going to spend most of my time in these next two years overseeing how we spend our stimulus money and how we get it out to people and get people hired because it's the single most important thing we can do. We've got to rev up this economy. We've got to get people having confidence in the economy again. If we can do that, I think this thing can turn around faster than the experts expect.

LYDEN: Now, Minnesota's governor, Tim Pawlenty, has been a vocal critic of the stimulus package. However, he's about to go on a spending spree to the tune of $9 billion. And I asked him how he plans to use this money to create jobs.

Governor TIM PAWLENTY (Republican, Minnesota): Our Department of Transportation and other departments have done an inventory of what could be contracted and be moving dirt, as we say, very quickly. We have that list ready to go and are confident that those projects could go forward within the next 90 days or at least getting many of them started.

An example could be what's called Highway 610, which is a project that connects two large interstates in our northern suburbs. The land has been bought. The right-of-way has been obtained. The designs are done. All that's missing is the ability to have the money and issue the contract, and that could start relatively quickly.

LYDEN: Massachusetts even has a new spending czar to oversee stimulus money for infrastructure projects. But at the end of the day, the buck stops with Governor Deval Patrick. Make that somewhere around 10 billion bucks for the state in all. He started making his wish list back in December.

Governor DEVAL PATRICK (Democrat, Massachusetts): Looking at what our infrastructure needs are, some of our own capital plans, some things that we have not been able to get to because we have not had access to that kind of capital, and we will sort through those based on where the maximum number of jobs are created and where we get the maximum amount of long-term economic value.

LYDEN: Can you just, you know, paint me a picture of one of those projects that's going to create jobs?

Gov. PATRICK: You know, I'm dodging your question a little bit, Jacki…

LYDEN: Yes, you are.

Gov. PATRICK: …because they are - I am on purpose because there are lots of my constituents and my fellows in government listening, I'm sure, from Massachusetts who want to know whether their particular project is on the list. But I can tell you that, for example, we have some prominent bridges that are structurally deficient that we want to get to as soon as possible for reasons of safety.

We have our own plans to extend broadband service to the remotest corners of Massachusetts. We've been developing those plans for the last couple of years. And our legislature has put some money behind that. We'll now be able to accelerate those plans, which is enormously important for educational and business reasons. So those are a couple of examples.

LYDEN: The reality is that governors may have to say no as many times as they say yes. Before the stimulus plan was anywhere shovel-ready, mayors and bureaucrats were already jockeying for a slice of the pie.

Minnesota's governor, Tim Pawlenty.

Gov. PAWLENTY: There's a part of the bill, one-third or so of the bill, that's competitive in nature, and not just the state can apply, but local units of government and even nonprofits, as I understand it. So they may have to compete.

And we had cities requesting snowmaking equipment, and that was Duluth -or something called Spirit Mountain outside of Duluth. We had another community requesting funds to rehabilitate a country club at a golf course. We had another city that wanted to build some tennis courts. So those aren't the kinds of things in this time of crisis that would be priority measures.

LYDEN: The federal government is sending out these checks with a lot of strings attached. It's not just X million for social services and X billion for infrastructure. It's X million for elderly nutrition, X amount for weatherization. There will certainly be a lot of competition for who gets that money, but not a lot of time to make those choices. And there's sure to be political fallout along the way.

I asked Governor Pawlenty a theoretical question.

Governor Pawlenty, if we're talking a year from now, and the stimulus plan is seen as having put a lot of people back to work, do you think that you and your fellow Republicans will have a political price to pay for having opposed it?

Gov. PAWLENTY: Well, the proof will be in the pudding. And, of course, a lot of claims get made about jobs being created over various legislation, but also, I would say, you've got to be careful about the intermediate effects of what's going on in the federal government. By that, I mean they are pumping so much money not just into the stimulus bill, but the trillions and trillions and trillions of dollars into the economy in monetary policy that you could see the whiplash effect of this being inflation or stagflation, even, in the intermediate term.

So if people are going to rewrite the history, I would suggest they look at it not just one year out, but three and five years out as well.

LYDEN: But by then, this money will be spent. And whether they supported the plan or opposed it, each governor will have to do that immediately and judiciously.

As Pennsylvania's Governor Ed Rendell put it:

Gov. RENDELL: Ready to go. Use it or lose it.

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Stimulus Money Meets Mixed Reactions From States

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Around the country, the lights in governors' offices have been burning late as staff members digest the details of the new federal stimulus package Congress passed on Friday. Reactions have been mixed.

The agreement between House and Senate leaders on a $789 billion stimulus bill was only a few hours old when Republican Gov. Tim Pawlenty of Minnesota went on MSNBC to criticize it. He said it was too heavy on spending and too light on tax cuts. But despite ideological objections, Pawlenty said he'll cash the check. "Minnesota pays way more into the federal government than we take out, so we are a very significant net contributor. So we're not gonna feel bad about taking the money."

Next door, South Dakota's Republican Gov. Mike Rounds was quite a bit more gracious, saying he hopes the stimulus package works. And he said South Dakotans likely will start to see changes from it as soon as next week, when the Legislature will start plugging state budget holes with federal money.

"And that may very well allow them to slow down some of the cuts that we've had to propose earlier, not knowing what the federal assistance might be," Rounds said.

Neither of the governors said the federal stimulus package will completely resolve their state's budget crisis.

In Colorado, Democratic Gov. Bill Ritter said there are still plenty of difficult decisions to make. Still, he's a big fan of the package and says the focus on lower-income people is a good thing. Ritter cites the boost in Medicaid funding and extended unemployment benefits.

"People who are unemployed wind up spending that money — it becomes a hand-to-mouth existence, certainly," Ritter said. "And you can assist the economy by assisting unemployed people. And I think you'll see that."

Ritter says that money will start circulating through the economy right away.

Among Democratic governors, a few are willing to inch toward criticism and say they'd expected to see more money from the package than they will. Washington Gov. Christine Gregoire says she was disappointed when the Senate passed its version of the stimulus package and slashed the amount dedicated to roads and bridges. In the end, Washington state got just over half a billion dollars.

"Our expectations were far greater than that," Gregoire said. "We expected in the billions." She says that means some job-creating projects in the Evergreen State won't happen right now.

"So there will be disappointments, no question about it," she says. "But in the long haul, as President Obama put it, it may not be perfect, but let's get going."

That's the attitude a lot of governors seem to have in response to the federal stimulus package. Florida's Republican Gov. Charlie Crist took some heat from GOP colleagues in his state for supporting the legislation. Crist explained his position at a press conference Friday in St. Petersburg, Fla.

"We're talking about where these additional $1.3 billion for transportation alone are gonna be going," he said. "You know, several months ago there was zero coming. So this is something we ought to be very happy about and celebrate. And it's going to produce tens of thousands of jobs for our fellow Floridians, and that's exactly what they need."

Perhaps the most interesting gubernatorial responses to the stimulus package came from Louisiana's Republican Gov. Bobby Jindal. He told The Associated Press he's not sure the state will take all the money it's eligible to receive — he said it depends on what strings are attached.



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