Thank you very much, Mark, for that kind introduction. It is nice to be here today with this tremendous group, and I want to start by thanking this organization for your leadership, and for your commitment, and for your perseverance. I think the recognition of Sue Levin, as the honoree at this year’s Statesmen Dinner, is a tribute not only to Sue, but also a tribute to Stand for Children. In addition, while there were certainly many people who played a role in the successful special session that we had last month, I think it is fair to say – I can honestly say – that it would not have happened without the support and engagement of Stand.
What I think was remarkable about the special session was not so much what we did, but how we did it and the fact that we did it at all, given what has been going on in Washington, D.C.
I want to return to that in just a minute, but first I would like to offer a brief summary of what we have been able to accomplish together over the last three years and the challenges that still lay ahead. I’m going to focus my remarks today obviously on education, but I would like to put that into a larger context; so, I want to take just a minute and talk about why education is so important in 2013.
I believe that our country was founded on the principles of equity and opportunity and pursuit of happiness. In other words, an equal opportunity to dream, and to aspire, and to achieve your full potential. And to pursue a common set of aspirations: to be healthy; to get an education; to have a job and job security; to live in a functioning, healthy, natural environment; to live in safe, secure communities where people have a sense of common purpose and belonging and commitment to one another.
Now, some people call those aspirations the American Dream, but I think they are the common aspirations of people everywhere. I think they’re things that all of us want, regardless of who we are, regardless of where we live, and regardless of what we do for a living. There are common aspirations that transcend political philosophy and party registration – and I think it’s important to remember that, this piece of common ground that we all have. The Greek mathematician, Archimedes, once said, “Give me a lever and a place to stand, and I can move the world.” So when we find ourselves at odds, this set of shared aspirations gives us a piece of common ground and a place to stand together if we chose to do so.
Now, central to the pursuit of happiness is the ability to make a living; to ensure that individuals can meet their own basic needs and the needs of their families; that they have access to and can afford things like food, shelter, clothing, education, transportation, healthcare, and utilities. And, furthermore, America was built on the notion that hard work is rewarded by a better life, and that you can leave your children better off than you were.
So, if you believe as I do, that at the heart of the American Dream lies this promise of opportunity, then public education is the vehicle through which that opportunity is most directly fulfilled today. Indeed, in 2013, there’s an almost linear correlation between educational attainment and economic attainment.
But here’s what’s important, and here is what I want you to think about today: Education and training alone are not enough; that’s just one side of the handshake. The other side is an economy that produces enough living wage jobs, or career pathways that lead to living wage jobs, so that everyone can, in fact, meet their basic needs. In other words, the American Dream and the promise of opportunity depend on the intersection of a well-trained and educated citizenry on the one hand, and an economy that creates living wage jobs on the other.
Now, with that context, let’s roll the clock back three years. When I took office in January of 2011, Oregon was a polarized state with an uncertain future. The fight over Ballot Measures 66 and 67 had left deep scars and even deeper distrust among people who really needed to work together in common cause. The Legislature was divided. We faced high unemployment and a $3.5 billion revenue shortfall, which was about 20 percent of the general fund.
In my inaugural address, I said that we should not underestimate the magnitude of these challenges, but we should never question our ability to successfully meet them. I also said that our future would be shaped by the choices that we made in the next six months, and by the civility with which we dealt with each other as we made the difficult choices necessary to put Oregon on a more sustainable and solid pathway.
And here’s what we did: First of all, we agreed on a vision, and that vision was 40-40-20. It was a commitment that by 2025, by the time that the kids who are in first grade today graduate from high school, that they will all graduate from high school – 100 percent – and that 40 percent of them, at least, will get two years of postsecondary education and training (an associate’s degree or a technical certificate), and another 40 percent would get a baccalaureate degree or higher.
We also committed ourselves through the Oregon Business Plan to ensure that these skilled and educated Oregonians could actually get a living wage job. The three goals of the Oregon Business Plan are to create 25,000 jobs a year through 2020, to raise per capita income across the state back up above the national average, and to reduce poverty back down below ten percent.
So, how have we done? Well first of all, we erased one of the largest per capita budget deficits in the nation with civility, not rancor, with bipartisanship, not polarization. And we were rewarded when our credit rating was increased from AA to AA+ in the depths of the recession.
Second, we took very seriously this commitment to creating jobs and growing the economy – over the past three years we have created more than 60,000 new jobs in Oregon and reduced our unemployment rate by two percentage points. We have had the third fastest growing economy in the nation in 2012, and the second fastest growing state economy in 2011.
We recognized that manufacturing was a bright spot in our recession, and we’ve doubled down on our efforts to secure an adequate inventory of large industrial sites. We secured the expansion of Intel, and Nike, and Daimler Trucks of North America. We’ve made progress in increasing access to water for irrigated agriculture in eastern Oregon and creating eastside forest health collaboratives, and we’re working to try to resolve the O&C issue in southwest Oregon. We’ve increased our investment in the Oregon Innovation Council and our signature research centers. We’ve expanded the film and video sector. We’ve taken three trade missions, two to Asia and one to Europe.
In the past three sessions we’ve also made huge progress in our efforts to create a seamless, outcomes-based system of public education, which for the first time seeks to align governance, funding, and policy across the entire continuum from early childhood to post-secondary education and training.
We’ve redesigned our early learning system based on performance contracts to ensure that all children are ready to learn when they reach kindergarten. We’ve significantly increased funding for early childhood services, we’ve implemented a kindergarten readiness assessment, and just yesterday the Early Leaning Council awarded the first round of early learning hubs to actually implement, start implementing, that new delivery model across the state of Oregon.
We’ve freed ourselves from the punitive nets and the discriminatory, arbitrary labels of No Child Left Behind, and we’ve replaced that with a legitimate and authentic way to evaluate our schools and to hold them accountable for performance. We have achievement compacts signed by every school district, every university, and every community college to align our collective efforts around 40-40-20.
We’ve launched 15 regional achievement collaboratives to engage the larger community in the enterprise of education – businesses, the faith community, community-based organizations, not-for-profits – all working together to support success of our students. And, finally, we’ve instituted strategic investments targeted at key leverage points to maximize the return on that investment in terms of student success. Things like early literacy and STEM, creating college pathways while in high school, and investing in support for educators and professional development. I think these programs are especially important for traditionally underserved populations, because we can no longer ignore or fail to act on the growing achievement gap in kindergarten readiness and third-grade reading, in college enrollment and completion. But by identifying students at-risk of dropping out or failing in grades 6 through 10, and giving them focused mentoring and monitoring, we can ensure that all of these kids have an opportunity to be successful in our state and in our society.
Finally, during the regular session we, as Mark said, started to turn the corner on funding by increasing our general fund commitment and trying to reduce somewhat the cost of the public employees retirement system. And I want to say at this point that these are benefits that were earned; I believe it’s very important that we maintain a strong retirement system for our public employees. But because of the stock market crash of 2008, the fund lost about 27 percent of its value, which drove up employer contribution rates. So the fact is that the crisis of school funding is no longer just a revenue problem – it certainly is a revenue problem – but it’s also a cost problem, and so we sought to try to address both of those issues. And although we passed Senate Bill 822, which reduced the unfunded actuarial liability by about $3 billion during the regular session, it still left a very high employer contribution rate, which interfered with our ability to get dollars into the classroom.
At the same time, although we had a good May revenue forecast that allowed us to significantly increase our investment in public education, there were still school districts that were facing teacher layoffs and reducing school days, and tuition increases in our community colleges and universities were preventing too many Oregonians from getting the skills they needed to return or enter the workforce – and I thought we could do better.
So as Mark said, two weeks after the adjournment of the regular sessions, I had a very interesting summer. I began travelling the state – without my fishing rod – holding town hall meetings, talking to legislators, businesses, labor, school boards, local governments, essentially with the idea of coming back in the fall and holding a special session to raise revenue to further reduce the costs of the public employee retirement system, to provide tax relief for small and family-owned businesses, and to reinvest – particularly in education – but also in mental health and services for senior citizens.
I called the session on September 30, and, as luck would have it, against the backdrop of this growing dysfunction and chaos in Washington D.C. The next day, on October 1st, the United States Congress shut down the federal government, and the next day, October 2nd, the Oregon legislature passed every one of those bills with bipartisan votes.
To me the implications of that success actually go far beyond the issues that we debated for three days down in Salem. I think it goes to the very heart of self-governance; I think it speaks to who we are and how we deal with one another and how we do the peoples’ business. I think people in Oregon and across this country are desperate – desperate for some sign, some indication, some reason to believe that their public institutions are capable of moving past partisanship and polarization and the gridlock of ideology, and acting in the larger public interest. And last month, in the state of Oregon, the state Legislature did exactly that. They demonstrated that it is still possible to build an operational, bipartisan political center in the country. They demonstrated that we can rise above our own worst days and that we can reach beyond partisanship and do the right thing for Oregon and for Oregonians.
This organization played an instrumental role in making that happen. It wouldn’t have happened without you. And I bring this up because although we’ve made great progress over the last three years, we still have a long way to go, and the challenges before us are indeed daunting. And so maintaining this bipartisan, operational political center is going to be essential for our future success. Currently, I think we have most of the policy and structures in place to actually achieve 40-40-20. The challenge remains to adequately fund that new system and commit to strong and consistent implementation over the next decade.
But here’s my real concern: even if we’re successful in redirecting resources into public education, and I believe we will be, even if we’re successful in implementing our policies and achieving 40-40-20, on our current course, we could end up with a healthy, well-educated, and well-trained citizenry that is either out of work or unable to secure a living-wage job.
Now let me be clear – I am very proud of what we did over the last three years, creating those 60,000 jobs – I want to create another 60,000 jobs, or 100,000 jobs. But the fact is, so far most of the job creation has occurred at the top and the bottom of the income ladder, leaving out the kind of middle-wage jobs that are so important for education security and prosperity.
The fact is that while we’ve come a long way over the last three years, our economy is simply leaving too many people behind: particularly people in rural Oregon, those from generational poverty, communities of color, and English language learners. As I mentioned earlier, America was founded on the notion that hard work is actually rewarded with a better life. But for far too many Oregonians, hard work no longer leads to a better life. Hard work no longer ends poverty. We’ve got too many people in Oregon trapped in low-wage jobs with no way out and no way up and no hope of ever reaching for the American Dream.
Oregon is not going to be a good place for any of us to live unless it’s a good place for all of us to live, and we simply cannot settle for an uneven and unequal recovery. In fact, I would argue that the word “recovery” loses any useful meaning when it describes a situation where the Portland metropolitan area is returning to pre-recession employment levels, but much of rural Oregon is still struggling with double-digit unemployment, and outdated infrastructure, and an aging workforce. The word “recovery” is hollow when used in a time when unemployment rates among African-Americans and Latinos continue to rise. And the word “recovery” is the wrong word to use for a state that has a 24 percent childhood poverty rate.
If we’re to truly stand for children, then we must stand for them not only in terms of their education and training to prepare them to prepare them for the economy of the 21st century, but we must also stand for them to make sure that that economy actually lifts all boats as it grows, and that it produces enough living wage jobs to ensure that every member of the class of 2025 can meet their basic need and can live the American Dream.
So even as we work to fund and implement our march toward 40-40-20, we also have to work together to ensure that the next phase of Oregon’s economic recovery reaches all Oregonians and ends the income stagnation that continues to erode the middle class, that exacerbates inequality and widens the opportunity gap, and for the first time threatens a generation of Oregonians with shorter life spans and a lower standard of living than their parents enjoyed.
I don’t underestimate the difficulty posed by any one of those challenges, let alone both of them. But I also know that we are capable of doing truly remarkable things when we work together, when we can find that common ground, that place to stand.
So I want to close by telling you about the Statesman Dinner in 2011 and the one we had earlier this year, or to remind you of them if you were there. In 2011, Co-Speakers Republican Bruce Hanna and Democrat Arnie Roblan were honored for balancing the budget and transforming our health care system and our system of public education with bipartisanship and civility. Sean Robbins, who’s the CEO and President of Greater Portland Inc., had just moved here from Wisconsin in 2011, and Wisconsin, if you recall, was in utter partisan chaos and meltdown. One of the first social events he went to was the Oregon Statesman Dinner. And he sat there watching this Republican and Democrat getting honored and thought he’d been transported to some alternative universe.
Well, two years later we did it again. In addition to honoring Sue Levin, we honored Democratic Speaker Tina Kotek and Democratic Senate President Peter Courtney, and Senate Republican Leader Ted Ferrioli and Republican House Leader Mike McLane, for reaching beyond partisanship and producing a successful special session in defiance of the dysfunction in Washington D.C. Now I think it’s fair to say there’s not another state in America that could boast of two events like that in a three-year period … or maybe a three-decade period. And you helped make that happen. And you can help make it happen again. So let’s build on this remarkable foundation. Let’s create that lever to meet our shared challenges and build a brighter future together, and today I’m asking you to partner with me to make that happen here in the state of Oregon. Thank you very much.