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Texas "Miracle" or Mirage?

Aired February 21, 2014 - 18:28   ET



ANNOUNCER: Tonight on CROSSFIRE, President Obama reaches out.

BARACK OBAMA, PRESIDENT OF THE UNITED STATES: I'm going to be seeking Republicans who are game to work with us.

ANNOUNCER: Will he find any takers in Republican red states or Democratic blue states?

On the left, Van Jones. On the right, Newt Gingrich. In the CROSSFIRE, Pat Quinn, the Democratic governor of Illinois, and Rick Perry, the Republican governor of Texas. The great divide, red states versus blue states tonight on CROSSFIRE.




Tonight we have two guests who represent profoundly different philosophies of governing. Here in Washington this weekend Democratic governors, who believe in high taxes, ironclad unions and greater indebtedness, are gathering with Republican governors, who are relentlessly cutting spending and taxes and then letting the private sector fill the gaps.

Now, today in the theater of the absurd, watching President Obama in a meeting with only Democratic governors attempting to reach out to Republicans will be one of the more farcical events for historians looking back on the total ineptitude of this administration.

JONES: Oh, my God.

GINGRICH: Come on, Van. Be honest with me. Wasn't that a bizarre moment?

JONES: OK. First of all, if you're looking for humor you're bragging on the red states, the red states are actually taking money from the blue states. We're the ones subsidizing all those wonderful jobs you're so proud of.

We're going to talk about this tonight. In the CROSSFIRE, we have a Democratic governor, the wonderful Pat Quinn from Illinois and Republican governor... GOV. RICK PERRY (R), TEXAS: Wonderful.

JONES: Wonderful, wonderful. Very effective.

Governor Perry of Texas. I'm glad to have you here, but we're going to have a big fight tonight, because I'm mad. You have this whole thing, this Texas miracle. Everybody is talking about how great the red states are. Listen, tell me why we should be trying to emulate you. I'm from California. You are 11...

PERRY: You said all you need to say. From California. You are out of there, brother.

JONES: I'll be on a plane very shortly. Listen, here's your beautiful red state performs. You try and understand this. Eleven of the 13 states with the highest percentage of kids in poverty, red states. Food Stamp use highest in the red states, not the blue states. Hard to go from being poor to being rich in the red states. Why should we be emulating your miserable, failed model in the red states?

PERRY: Well, Texas, I think it speaks for itself when it comes to those red states. And let me tell you...

JONES: I'm sure you're going to brag on Texas.

PERRY: Well, all of these red state, when you think about it, because the real issue from my perspective is what's the best that you can do for your family? And it's -- I've got to think even Van Jones thinks it's to have a good job and take care of my family so that they can go on with whatever they want to do in life.

JONES: No argument there, sir.

PERRY: And having a job is the single-most important thing. And red states -- and red states are creating those jobs. In the state of Texas, we created 30 percent of all the jobs, all the private-sector jobs from 2000 to 2012.

Now, you take those out of the equation, and President Obama, he ought to be thanking me in Texas for the job creation that we've done down there in Texas over the course of the last few years.

JONES: You thank -- you thank the geological miracle of all that oil and the immigrants down there. Do you agree with this, by the way?

GOV. PAT QUINN (D), ILLINOIS: No. 1, I'm very glad to be here. I was with the president today. And I'm here to recruit my good friend, Governor Perry, to help raise the minimum wage in Texas and across America. Our minimum wage is Illinois is $8.25 for people who work very hard. There's a principal as old as the Bible. We both believe in the Bible. And it says that you should not live in poverty. If you work 40 hours a week, and you're a mom and a dad trying to raise kids. I really hope you can raise the minimum wage in Texas as we did in Illinois and join us to do this all across America. This is a great thing. If folks have a J-O-B, why not give them a living wage? GINGRICH: Wait a second, Governor.

JONES: Amen. Amen.

GINGRICH: I just have to ask this. You know, last year the head of Caterpillar complained publicly about the anti-jobs, anti-business tone of Illinois.

I mean, isn't it a fact when you look at job creation, the states that have raised the minimum wage actually have the worst unemployment rate? And the fact is that Illinois has lost people. I think it's lost 40,000 people in the last year, the largest outpouring of people from any state in the country. I mean, so I understand why it's nice to...

QUINN: Let's talk about job creation.

GINGRICH: It does kill jobs.

QUINN: Job creation in Illinois, we're No. 1 in the Midwest since last May. We've created over 280,000 jobs.

Now, the head of Caterpillar made some bad investment decisions that hurt Caterpillar and hurt all of us in Illinois. And he should be accountable for that.

We believe in Caterpillar. We believe in John Deere. That's located in our state. John Deere Tractors. We believe in ADM (ph) and many other companies. We have Ford, Chrysler, Mitsubishi, all of them growing.

When I became governor, Chrysler had 200 jobs. Now they have 4,700 jobs in Belvedere, Illinois. Ford has three shifts. When I became governor they had one shift. So we're very grateful to our president, President Barack Obama, for saving the American auto industry. We worked with him. We believe in organizing, and UAW's organized Mitsubishi, Ford and Chrysler.

And I think it's a good way to get good wages and fair good -- working conditions for everyday people. And I still haven't heard from Rick about the minimum wage. How about it?

PERRY: I don't think -- I don't think it's government's business to be setting the minimum wage out there. And even the CBO said if you want to get rid of a half a million jobs between now and 2016, raise the minimum wage. And here's the issue, Pat, and I think you've got to believe this.

At a time when jobs are at a premium in this country, the last thing you want to be doing is putting policies into place that will kill jobs and not only -- not only...

QUINN: Putting purchasing power in the hand of consumers. They're going to spend the money.

PERRY: And to tell people that has a job today, I'm sorry, but to help these folks over here, you're not going to have a job. That is the wrong message.

QUINN: The Federal Bank of Chicago said every dollar you raise in the minimum wage creates $2,800 in purchasing power.

JONES: And Governor...

QUINN: Seventy percent of our economy are consumers buying things.

PERRY: We know...

QUINN: Let's put more money in the pocket.

PERRY: We know that forcing -- we know that forcing small businessmen and women to raise the minimum wage, they're going to have to make the decision between whether they're going to hire people or they're going to raise the wage.

QUINN: All these studies have shown the opposite.

PERRY: No, no, no, that's not correct. You are absolutely wrong about that.

JONES: First of all, you are the one quoting the CBO report which said zero to a million. So the same report you're citing actually makes this point. Zero jobs lost or a million. They're kind of guessing there.

But I want to ask you a question. You're sitting here defending these minimum-wage jobs, and we know for a fact that you have a lot of big corporations that are paying people, full-time workers, so little that they have to put their hand out for Food Stamps and for Medicaid.

Do you think that big corporations should be able to pay people so little in America that they have to -- that the government has to subsidize their workers? Are you for that?

PERRY: Ninety-five percent of all the jobs that were created in Texas during that decade were not minimum-wage jobs. Ninety-five percent of them are jobs that are paying above the minimum wage.

When you have an environment where you have the tax structure that doesn't strangle small businessmen and women, you have a regulatory climate that's fair and predictable, you have a legal system that doesn't allow for over-suing, and you -- you put money into an accountable public school and then get out of the way, jobs will be created, and good jobs. I'm talking good paying jobs in Texas, and it will work in Illinois even.

QUINN: The majority -- the majority of people who get the minimum wage are heads of households. They're moms and dads raising children. The best and most important thing you can do in life is raising your children. Isn't it important that we help everybody, even those 5 percent of folks who aren't making -- who are making the minimum wage?

PERRY: The most important thing that we can do, Governor, is to help create a climate where job creators know they can risk their capital, have a chance to have -- keep as much of that...

JONES: I'll tell you something else.

PERRY: They'll keep people at work.

JONES: Wait a minute. I'll give you one more, and then I've got one more.

QUINN: Rick Perry, a good friend of mine, he and I went to Iraq and Afghanistan together, and we were roommates. We were roommates. And we had some philosophical differences along the way.

PERRY: Just a few.

QUINN: But his daddy was in Texas, elected official. And he believed in Sam Rayburn, who was a supporter of Franklin Delano Roosevelt, who started the minimum wage. It was 25 cents an hour in 1938. Now it has to keep up with the cost of living. So I think you ought to go back to your roots. You know, you can come back home.

PERRY: You know what? My dad is going to have his 89th birthday in April. And I was talking to him just the other day, and I said, "Hey, Dad, what do you think about this minimum wage being raised?"

He said, "The government ought to stay out of our damn business." I'm just telling you -- I'm just telling you, Dad's an old Democrat.

QUINN: Mine is 96 years old.

JONES: You guys are worse than senators. You guys are worse than senators. The filibuster.

GINGRICH: A good conversation. But I want to switch to another burden that I think weighs down heavily on job creation and on the economy, and that's the issue of pensions. Today the manager in Detroit cut the pension of everybody in Detroit by 34 percent.

QUINN: The city of Detroit.

GINGRICH: The city of Detroit. Which is -- so even if you're currently retired, this was a real cut even for retirees.

Chicago has eight times the pension burden of Detroit per capita. Now, I know you've already shown real courage...

QUINN: I'm the governor of Illinois, OK? We did a $100 billion pension reform...


QUINN: ... that I signed into law last December. And I think it's important that we have pension reform, because we want to have enough money for our education, for our health care, for public safety, for our veterans. So it's really important we reform the pension system.

GINGRICH: But Mayor -- Mayor Emanuel has said that he hopes that the state legislature will help change the rules for pensions in Chicago. Actually, the eight times number does not count the teachers union pension which is an additional multimillion dollar burden.

I mean, do you think your state is going to have to do something fairly dramatic to get the Chicago pension funds, which is the largest in the country, the largest pension fund in the country...

QUINN: Well, they have to negotiate like anything in life. They have to sit around a table and negotiate a fair system. That's what we did at the state level for our major three pension systems of the state. And what I've also done for a couple of local pensions.

GINGRICH: But after your negotiations, the unions, I think, have already said they're going to file a lawsuit and immediately try to stop whatever you negotiate.

QUINN: Just about any law you pass is a major law that's going to be litigated. We'll defend it in court, and I think we'll win it in court.

The bottom line is you've got to take action. You know, I inherited a big disaster. When I got sworn in there was one former governor of Illinois in jail, another one going to jail. But we've straightened that out. And I think it's important to have strong ethics and definitely pension reform.

JONES: Well, we're proud of you for that. We're going to talk a lot more about unions.

But I'm not done with you, Governor. When we -- I think we're missing something here. When we get back, I'm going to tell you why the so- called Texas miracle is actually a Texas mirage. After these messages.


JONES: Welcome back. In the CROSSFIRE tonight, we've got two governors, one of whom says he's making miracles in Texas. Um-hmm.

This is the big question tonight. Should America's governors just do whatever big corporations tell them to do, just to get jobs, even if they're crappy jobs? Well, actually, lots of countries are already doing that. And the people there, they work endless hours for almost nothing. They drink poisoned water; they breath poisoned air. They can be maimed on the job, fired for no reason. You know what that's called? That's called the Chinese model. That's not the American model.

In America, we believe in extraordinary economic performance and extraordinary environmental performance and consumer protection and labor protection. That's who we are. That's why people come here, not the other place.

Now, I have nothing against folks who are stuck in third-rate banana republics. Just don't let anybody turn your state into one.

Now, to you, Governor --


GINGRICH: What a setup.

JONES: Isn't it the case that you've given $19 billion in subsidies to these corporations and yet when you look at -- you've got a large number of minimum wage jobs. Your new jobs, some of them are minimum wage. A lot of minimum wage jobs.

Aren't you just bribing corporations to come and create crappy jobs? Isn't this really just the Texas mirage?



PERRY: But you really bring up a really interesting thing. As I shared with you earlier, 95 percent of all the jobs created in Texas are above minimum wage. The jobs we're creating are good jobs.

And there's nothing wrong with entry level jobs. Best I can tell nobody started out at the corner office. So these entry jobs are important.

And here's the interesting thing that I think if you put the right tax policy and regulatory policies into place, and with this shale gas phenomena that's going on in the United States and hopefully our administration will really push that forward so that we can take advantage of that even more, driving down the cost of power, and we're going to be bringing those jobs back from China. We're going to be bringing those jobs back from India and they're going to be paying a heck of a lot better and we're going to create more jobs as long as we get the administration to go along with it.

JONES: You have a pro-fracker over here. So, go ahead, blue state pro-fracker.

QUINN: Yes, I'm for fracking. We have to have proper environmental protections.

But I wanted to ask you about health care. Why not accept the money from Washington to have more people with health coverage? We've done that in Illinois. I can't understand why Texas doesn't want to have everyday people --

PERRY: The answer's really straightforward, Governor, and it's we don't want to bankrupt our state. Because we know what's going to happen. Obamacare --

QUINN: Hiring people in health care.

PERRY: We've got some of the access to finest health care. We've got over 70 federally qualified health clinics in the state of Texas, (INAUDIBLE) locations. So, we're expanding --

QUINN: Have all these people have any insurance?

PERRY: The key is access to health care. What you're talking about doing with Obamacare is putting into place -- and I'm trying to find a lot of people that are for it now because it's become -- it's coming apart.

QUINN: People who are for it, the once who don't have to worry about pre-existing conditions any more, they now have health insurance.

PERRY: But the key is --

QUINN: They can get bad things that might happen to them prevented in first place.

GINGRICH: Let me ask you a question -- how many people in Illinois have sign up?

QUINN: Two hundred fifty-six thousand.

GINGRICH: Let me ask you, for Obamacare itself not for Medicaid.

QUINN: No, we have Medicaid in the health insurance exchange. I can't understand why any of the governors -- we have Indiana, Wisconsin, they don't want to take an opportunity to have more of their hard working people get health coverage.

JONES: Let me push you on this --

QUINN: Have you talked to those governors?

JONES: Look, I want to question you on this. There is a report that came out, I'm sure you've heard, that says because you won't take this money, you've got a bunch of people that they're too poor for Obamacare, they're too rich for Medicaid, they're going to fall through the -- 3,000 extra people might die.

Are you going to go to 3,000 extra funerals? What about that report? You like that CBO report. What that report?

PERRY: I don't buy that report. We've got the finest health care. We've got Texas Medical Center in Houston, Texas, where more doctors, more scientists, and more nurses go to work there every day. We have access to the finest health care in the country in the state of Texas.

Here's the more important question. Would you rather make the decisions for health care for Illinois, you and your legislature, or would you rather a bureaucrat from Washington, D.C.? Because that's what we've got with Obamacare. They're making the decisions for you.

I don't want them making decisions for us in Texas.

QUINN: I walk across Illinois, from the Mississippi River to Lake Michigan, and we have a decent health care for everyone. You can't have a system as you have in Texas where's there's Rolls Royce coverage for some people and no coverage whatsoever for lots of hard working people. You got to fill the gap. PERRY: Why are a thousand people a day moving to the state of Texas if it's such a terrible place, Van, that's what I want you to tell me, why?

QUINN: That's why you can make it even better if you raise the minimum wage and have health coverage.

GINGRICH: Governor Quinn, as we're demonstrating tonight, Governor Perry's relatively direct and quite cheerful about engaging. And he just did an ad that I want to share part of it with you that gives you a sense of this engagement because it relates to --

PERRY: Competition is a good thing.

GINGRICH: Can we run that just for a second? I want to share that with everybody.


PERRY: In Texas, we have conservative leadership. In Illinois, it's liberal. There's a big difference. Thirty percent of all the jobs created in America in the last decade were in Texas. And Illinois, last year they were number 48.


GINGRICH: Here's the question I want to ask you --

QUINN: We're not 48th in job creation. You're wrong about that. Not only that, we have more people which college degrees, more people graduated from high school.

GINGRICH: Wait a second.

QUINN: We're number one when it comes to making sure we build buildings in a 21st century way. We just got that award, top 10 in energy efficiency. We can teach you --

GINGRICH: His ad is not technically correct. The new report coming out says you are 50th.

UNIDENTIFIED MALE: Dead last. That's dead last.

QUINN: That's baloney, too.

PERRY: But, listen, competition is good. And you put your policies into place. Let's face it, Illinois has liberal policies from the standpoint of tax and regulatory. They are.

And people can pick and choose where they want to live, and they can move to Indiana or wherever, but they are moving to Texas.

JONES: Let's talk about regulations, and you're going all around the country bashing regulations, and it sounds good. And then when I find out in your state 70 percent of your counties don't even have fire codes. And you have that horrible fire in West, Texas, because there is no fire code.

Listen, there is -- you can have too much regulation, but don't you think you are going too far when you are against fire codes?

PERRY: I don't think that's the reason that that accident happened there and what you're saying is you're trying to draw a straight line between --

JONES: Are you against fire codes or for fire codes?

PERRY: I'm for allowing those counties to decide where they are, just like I'm for allowing the states to decide how to dispense health care rather than letting one place in America decide how all of us are supposed to leave. And that makes a lot of sense.

QUINN: You have a lot of industrial --


PERRY: We are at the average. Matter of fact, we are below the average on injuries.

QUINN: Illinois has second only to Texas in chemical plants and we have far fewer accidents because we believe in reasonable protections for every day people who work near them or live near them.

PERRY: So, if --

GINGRICH: Let me praise you a second, (INAUDIBLE) but I want to come to you.

You did sign a bill that promotes fracking for natural gas and oil in Illinois, which is very important and you said at the time that it would create a substantial number of jobs, and I commend you for that. Getting that through a Democratic legislature is a major achievement.

My question is -- would you be willing to talk to Governors Brown and Cuomo, and President Obama, and share with them this idea that this is a good thing?

QUINN: I was with the president today. I think he believes in fracking if it's properly done, with environmental protections. I didn't sign the bill unless it had that support of our environmental community in Illinois.

But I do want to ask Rick one other question regarding Texas and Illinois. You know, we're really good at taking care of moms who are going to have baby, getting them off to a healthy start. (INAUDIBLE) Texas needs improvement in prenatal. You're 50th in the United States in there. How about it?

PERRY: Interestingly, one of the most important things that we did in Texas and this was in 2003, we passed the most sweeping tort reform in the nation.

QUINN: On prenatal? PERRY: Yes, sir. We have 30,000 more doctors today, along the Rio Grande. There's 30 counties there, either along the Rio Grande or (INAUDIBLE) that didn't have access to OB/GYNs that do today. Tort reform is a powerful, powerful tool in the economics.

GINGRICH: I have to ask all to stay here --

QUINN: We need more baby doctors to take care of moms who are going to have babies.

GINGRICH: OK. I want to ask you all to say here.

We want you at home to weigh in on today's "Fireback" question. Which states are working more effectively for Americans? Tweet red or blue using #crossfire. We'll have the results after the break.

And, our "Outrages of the Day." Mine gets a gold medal.


GINGRICH: Welcome back. It's time for our "Outrages for the Day".

I'm outraged because nothing seems to change at the Olympics. A remarkable coincidence, a Russian figure skater at the Sochi, Russia Olympics managed to win a gold medal even though she stumbled during her performance. A Russian never has won the gold in this particular event.

They claim the judging is anonymous. But we know one judge is married to the head of the Russian figure skating federation. Another was suspended for trying to fix an Olympic event 16 years ago.

Personally, I think the anonymous judge who threw the contest was Vladimir Putin.


JONES: Well, first, Edward Snowden, Syria, and now this.

Anyway, look, my outrage is the Arizona legislature. They passed a terrible bill yesterday, and it would actually let business owners pick and choose which customers they want to serve based on the owner's religious beliefs.

Now, this is obviously nuts, because anybody can use the bible to justify any kind of bigotry. And not just bigotry against lesbians and gays, slave owners actually used the Bible to defend slavery. After all, Abraham had slaves, Paul returned a runaway slave.

Furthermore, segregationists use the Bible to defend segregation. After all, in Genesis, God separated the people after the flood, man should not mix what God himself has separated. I used to hear that growing up.

So, look, I'm a person of faith, but freedom to worship does not mean freedom to discriminate. That is the one exception that would swallow up the whole rule. So, I hope they veto that thing. So --

GINGRICH: Go to Facebook or Twitter to weigh in on the "Fireback" question, which states are working more effectively for Americans?

Right now, 42 percent of say red states, 58 percent of you said blue states.

I'm guessing you agree with the 58 and you agree with 52.

QUINN: A lot of good viewers there.

You know what, Rick and I don't always agree, in case you didn't see. But we do agree on helping service members and veterans and we went together to Iraq, to Afghanistan. We had 3,700 members at the Illinois National Guard in Afghanistan a couple of years ago, and we've got to make sure we take good care of those who are (ph) in the battle.

JONES: Well, listen, I want to thank Governor Pat Quinn and Rick Perry.

The debate will continue online at CNN.com/crossfire, as well as Facebook and Twitter.

From a blue state, I'm Van Jones.

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

Join us Monday for another edition of CROSSFIRE.

"ERIN BURNETT OUTFRONT" starts right now.