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CROSSFIRE

Can Governors Lead Reform in Washington?; Free Government Money: Should States Take It?

Aired November 22, 2013 - 18:28   ET

THIS IS A RUSH TRANSCRIPT. THIS COPY MAY NOT BE IN ITS FINAL FORM AND MAY BE UPDATED.


(BEGIN VIDEO CLIP)

ANNOUNCER: Tonight on CROSSFIRE, is the cure for Washington gridlock outside of Washington?

GOV. CHRIS CHRISTIE (R), NEW JERSEY: We're talking about the common- sense solutions that we're bringing to the people of our state.

ANNOUNCER: When governors come to Washington, are they a breath of fresh air, or out of their league?

GOV. NIKKI HALEY (R), SOUTH CAROLINA: I'm a huge fan of governors.

ANNOUNCER: On the left, Brian Schweitzer. On the right, Newt Gingrich. In the CROSSFIRE, Jeff Markell, Delaware's Democratic governor; and Scott Walker, the Republican governor of Wisconsin. Are governors showing the way to reform Washington and the country? Tonight on CROSSFIRE.

(END VIDEO CLIP)

BRIAN SCHWEITZER, CO-HOST: Welcome to CROSSFIRE. I'm Brian Schweitzer on the left.

NEWT GINGRICH, CO-HOST: I'm Newt Gingrich on the right.

In the CROSSFIRE tonight, the governors of Delaware and Wisconsin.

If we've learned anything in the past few weeks, it's that Washington is profoundly broken. We've seen the incompetence. Tonight, I'm sitting with three people who know what competence is. They're governors. The states are the future of the country. There's an immense amount Washington can learn from the nation's governors. So I'm really glad to be glad to be here with three of you. I'm a little intimidated here. We're building up these governors, and here all three of you are at the same time.

SCHWEITZER: Well, first a few house rules: nobody calling anybody "Governor," because it's just too confusing. Is it OK, Scott?

GOV. SCOTT WALKER (R), WISCONSIN: Absolutely.

SCHWEITZER: Jack? Brian and Newt?

GOV. JACK MARKELL (D), DELAWARE: Got it.

All right. We're ready to go.

MARKELL: Three governors and a speaker. Sounds like a movie.

WALKER: A bad movie.

GINGRICH: In the CROSSFIRE tonight, Delaware Governor Jack Markell and Wisconsin Governor Scott Walker. Governor Walker just published a new book, "Unintimidated."

Brian, since you've been a governor, I think you ought to dive in first, because you sort of get what this is all about and why state capitals are so different from Washington, D.C.

SCHWEITZER: Scott, the unemployment rate in Wisconsin is about 6.5 percent. That's about 50 percent higher than Minnesota and Iowa and North and South Dakota and Nebraska, your neighbors. We governors, we always brag that we're going to create jobs, and we're actually judged on how we create those jobs. People are watching. Are you letting the people of Wisconsin down?

WALKER: No, just the opposite. Actually, the better comparison is Illinois-Wisconsin. Because four years ago at this time we were about the same level. Four years ago, middle of 2009, Wisconsin had a 9.32 percent unemployment; Illinois with a 9.4 percent. Today Illinois still has about a 9 percent unemployment. As you mentioned, we have 6.5 percent.

SCHWEITZER: But Scott...

WALKER: But more importantly, historically long before I was governor had lower unemployment rates than Wisconsin.

SCHWEITZER: But more importantly when you were running in 2010, you told everybody in Wisconsin that you would create 250,000 new private- sector jobs...

WALKER: By 2015.

SCHWEITZER: And I think -- well, by the time you finish in 2014. I think you're around 90 or 100,000 people?

WALKER: Hundred thousand.

SCHWEITZER: So have you broke your promise to your constituents? And can you run for reelection if you don't get to 250,000?

WALKER: Well, the 250,000 was two years from now, by 2015, and it's a stark contrast, because under Jim Doyle, my predecessor, we lost 133 thousand. So I had to make up for the jobs that were lost, which we're well on our way to doing.

SCHWEITZER: They have to trust you to get reelected before you deliver on the 250,000? WALKER: It's by 2015; that's the promise we made. That's why we created a better business climate. We took that unemployment rate that was right where -- right where the state of Illinois is right now, and we dropped it down to 6.5 percent. We create a better business climate.

GINGRICH: Let me ask you. You've faced somewhat similar problems. Delaware, I think, has lost about 5,000 jobs, although alalthoughthough in a terrible national economy.

To what extent is part of the challenge just the whole nature of the Obama economy and the degree to which the country generally is not creating the kind of economic growth we'd like to have?

MARKELL: Let's face it, the financial crisis was an unbelievable catastrophe. But we've had many, many months now of job growth across the country.

I think the bigger issue is what's the changed role of the U.S. economy and a global economy? And I think that's something we really have to make sure that people understand.

When I talk to folks in Delaware, when I talk to businesses about how we can make them more successful, frankly, it all comes down to the quality of the workforce. And that's the work that's going on across the country, certainly in Delaware, to make sure that we're helping our people develop the skills that they need to succeed in a global marketplace.

GINGRICH: So from your perspective, how much of it is what you can do to make Delaware competitive, and how much of it is caught up in this larger national economic challenge?

MARKELL: I think it's both. I mean, states will do better. I think to some extent the rising tide lifts all boats, but that being said, I don't think you'll find any governor who's prepared to just sit back and wait for the national economy to get better on its own. We are -- we compete with each other all the time. We're prepared to do that, but it certainly helps when the overall national economy is growing.

SCHWEITZER: Scott, the Republicans here in Washington, D.C., and we're all here in Washington, D.C., well, they're actually polling lower than the belly of the snake. And you've had -- you've had an op-ed recently that criticized the Republicans here for the shutdown. Could you please explain that?

WALKER: Yes. I mean, I think government is too big, too expansive, grown too far into our lives, particularly at the federal level. But I think for what's left and what is necessary, it should work. And to me, just shutting things down, I don't think was part of the occasion. I realize it wasn't just one set of lawmakers who were responsible. It was kind of the whole group out here.

But the reality is I think across the nation, you see in the states governors showing that we can make things work. Particularly if you're a Republican governor. There's 30 now in America that have stepped up and said, "Yes, we think -- we think the government should be limited, but it should work." And we've got an optimistic, relevant message out there that I think is working, even in battleground states.

SCHWEITZER: You think -- you think Ted Cruz -- you think Ted Cruz is hurting the brand name of the Republicans nationwide?

WALKER: Well, I think that every Republican out there has a right to say what they want to say...

SCHWEITZER: But he's the mastermind of the shutdown.

WALKER: But I think the media loves to obsess -- I'm honing in on one or two people, instead of looking at the totality of what we're doing. And across America, particularly in battleground states like Wisconsin, like Ohio, like Michigan...

SCHWEITZER: But did his strategy work, though? I'm talking about his strategy. We can love Ted Cruz or -- Did his strategy work of leading the Republican Party to the shutdown? Did the strategy work?

WALKER: I think in the end, the fact that we're back on focus, not on the shutdown but on Obama care, is where we need to be as Americans. Because in the end...

MARKELL: Is that really where Americans need to be? Don't they need -- don't Americans need to be focused on a growth agenda?

WALKER: Yes, and the best way we tackle that is by getting rid of the uncertainty that comes from Obama care.

MARKELL: Scott, I have to disagree. I mean, certainly the roll-out has been flawed, and there's no question about it. But that being said, there are so many entrepreneurs -- budding entrepreneurs who have wanted to go out on their own, start their own business, but they felt that they've been locked in to employer-based health care. And now this is the first time that so many of them are going to have the opportunity to get out, start a business, because they're going to be able to get a policy on their own.

WALKER: Well, we just saw on CNN earlier, at least for those young entrepreneurs, a handful, and literally a handful are the ones signing up. And that's going to be part of the problems with not just this rollout but whether or not it can be successful or not.

It was about access; it was about cost. In our case, for example, Wisconsin, we were one of the few states that had no coverage gap, according to the Kaiser Family Foundation. So access wasn't the issue. It was the cost. And instead of this being an Affordable Care Act, it is exceptionally unaffordable...

MARKELL: I have to agree.

WALKER: ... for entrepreneurs and small business owners. Over our state. I don't know how it is in your state, but it is in ours for sure. MARKELL: I -- well, I talked yesterday to a guy. His name is Phil Katz. He's in Rehoboth Beach, Delaware. Sixty-one years old. Couldn't get any care because his wife had a preexisting condition. Now, he was frustrated, because it did take him a few weeks to navigate the Web site, but at the end of the day, he's reduced -- they've reduced their monthly bill by $800. They've reduced their deductible by $2,000. And they got better care than others.

And I do think once the Web site's working -- and it's got to be fixed -- we're going to be hearing more and more about those kinds of benefits.

GINGRICH: So let me ask you, though, you have the scale of the disaster of the Web site. There's a marriage penalty buried in there, which is -- it goes up to $10,000 a couple. You had a lot of places where they're literally cutting off, especially, hospitals because the way they're controlling costs is they're just cutting off care.

Isn't -- isn't Obama care going to have to be fairly dramatically modified for it to work?

MARKELL: I think it's going to have to get better and better. And I've heard the president himself say he's more than willing to sit down with Republicans and Democrats alike to make it better. That being said, I think there's a lot that's promising.

And I think one of the problems that we have is we have this sort of collective amnesia about how bad the situation was before this all got started. Whether it's -- I mean, for example, in my state, one third of the people who try to get an individual policy get turned down because of a preexisting condition. We all know about the cost of uncompensated care. The fact is, middle-class families in this country have been paying thousands of dollars additional to their premium every year, because they've had to pay for the cost of care for people who don't have insurance in the first place. Those are underlying problems, and I do believe that this law...

WALKER: But there's no doubt about that. And what you mentioned before about entrepreneurs looking to get into health care without doing it through an employer system, I would agree with you on that.

The difference is, is the federal government the one to drive that? Or ultimately, can we address preexisting conditions? Can we address purchasing over state lines? Can we address things through changing the tax incentive, which in the past, you're right, has been almost exclusively driven toward benefiting employer-based plans. And instead, offer a model where you can do that across the board.

SCHWEITZER: But if you've got a bad insurance policy that doesn't cover your -- all of your needs, if it doesn't cover mental health, it has a cap on an annual basis, if it's a lifetime cap, if it has exclusions for preexisting conditions, what good does it have Montanans to have an insurance company come to Montana with that bad policy? Don't we have to have a national policy that says, if you have health insurance, it has to be comprehensive?

WALKER: Well, it would be kind of like saying if you have health insurance, you can keep it.

SCHWEITZER: No, it's not that at all. I'm asking you this question.

WALKER: But that's what we're doing right now.

SCHWEITZER: Don't we need a national policy that says, if you're selling somebody a complicated health-insurance policy, it has got to be comprehensive?

In your state, you wouldn't allow an insurance company to sell insurance that says, "If you get in a car wreck" -- you're require to have car insurance -- "if you get in a car wreck on Tuesday, we don't count it. If you hit a red car, we don't count it. If you do it on Saturday, we only count half." But that's what a lot of these health- insurance policies are. Don't we need a health-insurance policy...

WALKER: That's why we need a streamlined system so that the entrepreneur that Jack was talking about doesn't have to buy a Cadillac plan, which is way -- why the employer-based program in the past was giving incentives to encourage large Cadillac plans, when young entrepreneurs really need something much more simplistic than that.

GINGRICH: You put up a very good defense a minute ago of Obama care. Are you comfortable enough that, by next fall, Obama care will be a net-plus in this economy, that you would encourage people to run as Obama Democrats?

MARKELL: Well, I just -- I think we have -- the thing has -- the Web site has got to get fixed. When the -- when the Web site gets fixed and people see that these plans are good plans, they're affordable plans, I think that is going to be a net -- a net positive.

I also think -- I mean, there's some irony -- a little bit of irony in the question, in that it's not clear at all that the Republicans have any plans. And I think you said a few months ago, Newt, that the GOP has absolutely no plan for health care.

GINGRICH: We have lots of plans, which our members don't, frankly, know how to go about and explain. But there are a number of plans out there.

But my question will be, given what you're seeing happen right now, are you comfortable saying that people out running for Congress, running for the Senate, it's OK to wrap yourself up. You're an Obama Democrat. Be proud, defend all this mess? Because it's all going to be fine by next October?

MARKELL: First of all, the Web site's got to get fixed. If the Web site gets fixed, I think there will be a lot of good stories out there. I'd much rather be supporting that than to be supporting the GOP, which as you said yourself a few months ago, really hasn't offered any plan.

SCHWEITZER: We haven't even -- we haven't even talked about the biggest disagreement between these two governors. It's one that impacts everyone's budget, and these governors are on the opposite sides. I'll ask them about that, next.

(COMMERCIAL BREAK)

SCHWEITZER: Welcome back. In the CROSSFIRE tonight are governors Jack Markell and Scott Walker.

The nation's governors are right in the middle of a fight over Obama care and Medicaid. But here's the dirty little secret.

In 1999, you, Scott, and the legislature in Wisconsin voted to expand Medicaid to cover all able-bodied adults who make up to 200 percent of federal poverty level. Obama care only pays for people who make 133 percent.

So Governor Walker, you're trying to act tough by refusing to expand Medicaid, while your state's actually taking more federal money to cover more people than the president would.

WALKER: Now, actually, oddly, Brian, it's a little bit different than you say in the sense that my predecessor, Jim Doyle, a Democrat who raised that eligibility up to 200 percent, only put enough money to fund a portion of that...

SCHWEITZER: You actually voted in 1999 as a legislator to take it to 185 percent, though, right?

WALKER: I'm pointing out, when he went up to 200 percent, the kicker was not the percentage. It was the amount of money to put in. So there wasn't enough to fund all those people, so they were literally on a waiting list, even though they were living in poverty.

Under my plan, I reduced the number of people insured by 224,000. I put everyone living in poverty on Medicaid for the first time in our state's history. No Democrat or Republican has done that before. And going forward, everyone living above is transitioning to --

SCHWEITZER: But c'mon, Scott. In Wisconsin, you can earn $15,000 more under that Obamacare and get covered by government health insurance. Isn't like the Badger having both of his paws in the federal trough?

WALKER: Well, what we did was neither one did, or the other did. We didn't take the path that those who said no to it did so. We didn't take the path for those that said yes. We picked the Wisconsin way, which said we'll put more people in a position where they're transitioned into the workplace and not on government assistance, had fewer people on Medicaid, and yet have --

(CROSSTALK)

SCHWEITZER: So, you're making Obamacare work in Wisconsin.

WALKER: Well, it's the law. The law simply -- we've had to delay it for three months, because the roll-out didn't work. We didn't want people to fall through the cracks, because it's not working. But in the end, we're not going to put our taxpayers on the hook. GINGRICH: Let me ask you a question, Jack, about working. In the first 30 days, Delaware Web site signed up four people at a cost of $4 million. Now, isn't a million per person a little bit inefficient? I mean, it just strikes me -- I don't want to sound like I'm a conservative, but it just strikes me that a million per person. This is a really -- you know, if that was the Obamacare average nationally, we really would go bankrupt.

SCHWEITZER: You can actually fly to the moon for a million dollars with Sir Richard Branson.

MARKELL: So, first of all, we've got 136 people signed up so far. We've got about 3,500 people who have put their enrollment applications online, that they have registered to enroll.

But let's face it, the Web site has to get fixed. Everybody agrees with that. And so, you know, we're as anxious as anybody for the Department of Health and Social Services and CMS to get that fixed.

That being said on the issue of Medicaid expansion, for us, that was a slam dunk because this was not a partisan issue. It wasn't Democrat or Republican. It wasn't a matter of philosophy or ideology.

And this was really for us a matter of math. And here's the math -- we're able to cover an additional 30,000, 35,000 people, people who are going to get access to care. They're not going to have to get sick and sicker and end up in the emergency room. The federal government does pick up 100 percent for the first thee years, 90 percent thereafter, and there's also a higher reimbursement for people who've already covered.

So, for us, we just -- we put the spreadsheet together. We look at every which way from Sunday and it was a total slam dunk.

GINGRICH: Yes. But I've been watching this, state after state, vast majority, overwhelming majority of who's getting covered right now, is in Medicaid. And it raises the question: couldn't you have done virtually every positive Obama wanted to, with a Medicaid fix, not messed of small businesses, not messed up small business, not gone through all this other stuff and gotten probably 90 percent of the good you're trying to get in terms of helping people without doing any of the bad?

MARKELL: Look, the reason that so many more people so far have signed up for Medicaid is because the Web site hasn't been working. When the Web site is working, there are going to be lot of stories like the Phil Katz (ph) that I mentioned, or the Janice Baker (ph) also from Sussex County, Delaware, and many, many others.

But let's -- until the Web site gets fixed, it's going to be very frustrating.

SCHWEITZER: Scott, you know, Chris Christie and Governor Kasich and Susana Martinez and yourself, you've all used Obamacare to expand the coverage of health care in your states. If one or all of you run for president, won't that qualify you since 90 percent of Republicans in the recent polling are against Obamacare?

WALKER: Well, in our case again, like I said, we did was completely different. We didn't --

SCHWEITZER: No. But you're using Obamacare as the principle. You're moving people off your Medicaid program and moving them into the insurance exchange. That's what you're doing.

WALKER: You're absolutely right. We're using what's available to us. And I -- as mentioned at the start of this, I'd prefer a better market-based solution. If we don't have it --

SCHWEITZER: What they've done is they've agreed to Medicaid expansion. They didn't have people up to 200 percent like you did. They didn't have the Badger with his foot in the trough like you did in Wisconsin. So -- and they didn't like at yours like 95 percent, so you're actually moving up to 133 percent. In Montana, we were at 56 percent.

You were already at 200 percent, So you're just kind of using this system --

WALKER: But we move the eligibility down to 100 percent, because we thought Medicaid was actually for people living in poverty, and that people living above should be transitioned into the marketplace, because whether it's that and food stamps or unemployment, we actually measure success in government, but how many people are no longer solely dependent in the government and transition to the workplace.

SCHWEITZER: So, the Republican voters won't hold it against you governors if you do run for president because you used Obamacare.

WALKER: Conservatives across the country have said this is one of the most innovative plans because we didn't do what some states did in not taking it. We didn't do what some states did in taking it. We didn't put the taxpayers in our state on the hook, relying on a federal government that can't even get a federal Web site up and working to depend future money for that (ph).

And instead, we put a plan in place that the Kaiser Family Foundation, not exactly a conservative think tank, says Wisconsin has no coverage gap.

GINGRICH: Let me ask you a question -- people tend to characterize Republicans as cheaper, and Democrats is more generous when you think about government. But the fact is Wisconsin has covered many more people than Delaware has.

How do you respond -- I mean, Delaware is not a particularly poor state, and yet it's pretty clear that the Badger Care has taken care of a substantially larger number of poor people.

MARKELL: Well, I don't know if it is or not. And I don't know, and I really don't know. I'm not being argumentative.

But, you know, the question is when you've taken them off Medicaid and put them into the Obamacare, is the effect of that. Some of them may not actually be able to afford the premiums and I think this is one of the risks.

So, you know, in our state, we have 90,000 people who don't have insurance. We expect 30,000 to 35,000 will sign up on the exchange. We expect probably another 30,000 on Medicaid and they're probably 30,000 who won't be on either one.

WALKER: Some Democrats in our state questioned it. And they asked whether or not, and I said that's Obamacare as it was passed. Now, for someone living just above poverty, with the subsidy for a premium, it's as little as $19 a month. To me, that seems pretty affordable if it works. Now, that's the question mark. It's why we delayed the start date about transition. It's not working.

GINGRICH: Scott -- I'm told that we're going to go next. I want to ask everyone to stay here. Next, we're going to the final question for both of our guests.

We also want you at home to weigh in on today's "Fireback" question. Does GOP have a better chance of winning the presidency in 2016 if it nominates a governor? Tweet yes or no using #crossfire. We'll have the results after the break.

(COMMERCIAL BREAK)

GINGRICH: We're back, with Governors Jack Markell and Scott Walker.

Now, the final question.

Let me ask you, Jack -- you've run the executive branch. You've had people report to you. If you had had a cabinet officer with a disaster on the scale of this Web site, wouldn't you have replaced him for sheer incompetence?

MARKELL: I think Secretary Sebelius is extraordinarily competent actually. She was a great governor. She was insurance commissioner before that. And, you know, I think the main focus now is getting this thing fixed and I'm sure she is very much focused on getting that.

GINGRICH: Let me ask a follow-up because I can't help myself.

MARKELL: Go ahead.

GINGRICH: We have this total national fiasco. This is a country that has Amazon, eBay, Google, Wikipedia. You now know that they were being told for weeks, this is not going on work. And they went ahead.

And, apparently, if you believe the president's press conference, nobody happened to say to him, "Oh, by the way, big guy, this whole thing is going to crash and burn."

I mean, shouldn't somebody be held accountable?

MARKELL: Yes. I think the first thing is everybody ought to focus on fixing it. Once it's fixed, once it's up, once people can access the site, once people are signing on, then we can think about --

GINGRICH: So the morning after it works, we might say goodbye to Kathleen?

SCHWEITZER: Scott --

WALKER: But doesn't it seem like the bigger problem with, that as I understand watching from afar, wasn't so much the cabinet secretary as much as a lot of these decisions early on, at least talking about it, came from the political shop in the White House and not from the policy team out in the cabinet. And all of us who have been governors know, Democrat and Republican alike, you've got to depend on your policy folks before you start making political --

SCHWEITZER: They need to bring a bus load of teenagers in to get this thing fixed.

Now, Scott, both Jack and I came from the private sector. We were business people when we ran for governor. And both of us have run for re-election. I think you got nearly 70 percent, I got 65 1/2 percent in reelection.

You're up for reelection next year, and you're running against a businesswoman by the name of Mary Burke. Do you think you're helping your cause by being outside of Wisconsin, going to these fancy dinners and wearing a suit? Why don't you get back to the county fairs and some of these harvest dinners and spend a little more time in Wisconsin because reelections can be tough?

WALKER: Well, in my case, it's interesting. This week, we're out on a book tour because I called a special session for the first week of December because my lawmakers, Democrats and Republicans alike, asked me not to call for this week going into Thanksgiving. So it was the perfect time to be out talking about a book to talk about the story of Wisconsin. Not just the story --

SCHWEITZER: Scott, you and I are known around the country as straight shooters, straight talkers. So, I'm going to ask you straight -- are you running for this president in 2016?

WALKER: Running for governor. And I have done it not once but twice in the last two and a half years. I'm focused on being governor --

SCHWEITZER: I know you're running for governor in -- are you running for president in 2016?

WALKER: I'm running for governor. That's what I'm focused on. That's what I'm doing. That's what I'm going for.

GINGRICH: On that cheerful note, I want to thank Governors Jack Markell and Scott Walker.

I want -- urge all of you to go to Facebook or Twitter to weigh in on our "Fireback" question. Does the GOP have a better chance of winning the presidency in 2016 if it nominates the governor? Right now, 47 percent of you say yes, 53 percent say no. SCHWEITZER: The debate continues online at CNN.com/crossfire, as well as on Facebook and Twitter.

From the left, I'm Brian Schweitzer.

GINGRICH: From the right, I'm Newt Gingrich.

Join us Monday for another edition of CROSSFIRE.

"ERIN BURNETT OUTFRONT" starts right now.

Great job.