Charlie Baker: Balancing The Budget Would Be Job No. 1

Charlie Baker has officially declared his bid to be governor of Massachusetts. The Republican filed his campaign papers on Wednesday. Baker, who was head of Harvard Pilgrim HealthCare for the past decade, served in the administrations of Gov. Bill Weld and Acting Gov. Paul Cellucci.

Straight after Baker filed his paperwork, we met to talk about his run for the Corner Office.

Bob Oakes: What would you bring to the job of Massachusetts governor?

Charlie Baker: I served eight years in state government, including during a really awful time financially and economically; I've done a stint as a selectman at the town level; I've spent time running a business that is admittedly a non-profit, but it's in the health care space and most of my customers are Massachusetts-based businesses that I've spent a tremendous amount of time talking to — and I hope I've learned along the way from all of those experiences.

Why do you want this job? Why do you want to be governor?

I really like living here and I think Massachusetts is a great place, but I worry a lot about our economic trends and I worry a lot about our future — young people don't stay here the way they used to. And I think we're losing them for fundamentally one big reason, which is: We're not creating enough economic opportunity for them to come up with a good reason to stay.

What would Gov. Baker do about that?

Well the first thing I'd do is try to create a predictable and stable financial situation for the commonwealth. This is our third year of sort of spending one-time money, either rainy-day fund money or federal stimulus money, to balance our budget; we raised taxes by almost a billion dollars in fiscal 2009 and fiscal 2010. I just think we're in a very bad place from a stability, predictability point of view.

So I think Job No. 1 is balancing the budget, living within our means and sending a message to the employer community and to the population generally that this is going to be a stable, predictable environment from a regulatory and a financial point of view.

But what could the Democratically-controlled Legislature and the governor have done differently in the last year and a half or two? Because every one was sort of caught by the fact that the economy plummeted, and everyone's revenues — in terms of  what the state has taken in and is going to take in tax-wise — have been off. Which is part of the reason why budgeting has been the toughest in a decade and a half.

I'll be the first to admit that this is a really difficult environment, but I think we made some decisions in 2007 and 2008 and the early part of 2009 that made it a lot worse.

So now we look ahead beyond the election next year: Does Gov. Baker promise no new taxes?

I think we need to send a message — to the employer community and to the population generally, to the small business, to the large business, to the working person — that we're not going to raise taxes to solve our financial problems, we're going to reform and restructure.

And I totally get the fact that saying that means a very rough and difficult period of time to work our way through it. But it is a far better alternative than to end up in the situation where every single year we're raising taxes and cutting stuff because we haven't been able to figure out how to create a structurally balanced budget.

A year and a half out before the election, I'm not going to ask you exactly how you fix it, but give us a snapshot of how you'd go about doing it.

Why don't we have a hiring freeze in place? Why haven't we gone back to re-negotiate with our public employee unions? Why aren't we furloughing state workers? Cities and towns are doing it. There was a proposal made a couple of years ago around restructuring the Medicaid program. It never even got a look. We should be looking at every idea that comes down the pike and trying to figure out a way to pursue it.

Well speaking of the Pike... (laughs)... since you brought it up, let me ask about the Turnpike and the Big Dig, because you know you're going to face this as an issue during the campaign, I mean you're already facing it.

The state Democratic party has set up a Web site called bigdigbaker.com, and it talks about during the Weld-Cellucci administration there was a lot of overspending on the Big Dig and a lot of today's problems with trying to pay for it developed during those years. Did the administration back then make a mistake in how it was handling Big Dig finances?

Everybody shares some responsibility for the Big Dig, including the current folks who put that Web site up. And I think what we really ought to be talking about going forward here is how are we going to get our economy back on track and how are we going to balance our budget and create some job opportunities for our kids?

When you were in the administration, you suggested that work on the Big Dig be paid for by adding Big Dig debt to the Massachusetts Turnpike Authority. Do you regret that now?

No. The original intent there, which was by the way supported by two governors and many members of the Democratic Legislature, was built on the premise that once you actually extended Route 90 all the way  — you know, 9o East — all the way to the airport, you were creating for all intents and purposes an end game for the Turnpike.

And having the Turnpike as the overseer of that I don't think was fundamentally a bad idea. I do think some of the things that happened with regard to the financing and execution of it at the Turnpike after that really screwed it up.

Let me ask about the state's health care coverage law. Concerns presently about whether it's too expensive, whether the state can continue to afford it?

I think it ought to be on the table just like everything else, but I don't think it ought to be the only thing on the table or the first thing on the table. I think it's been quite successful with regard to providing coverage for people. I said at the time when it was passed that I really thought affordability and cost ought to be a huge piece of sort of the next act, and we've been slow as a state to move on the next act.

One of the first things you mentioned was your concern about jobs in Massachusetts. Certainly we've seen in the last decade or two manufacturing jobs moving out, almost drying up; great competition out there for the high-tech jobs that used to exist in Massachusetts; for the green-tech jobs that the state would like to attract; for the life sciences jobs that are developing here, but are not guaranteed to stay in Massachusetts.

And, amid all of that, there's the brain drain that you mentioned — young people go to school here, but leave for jobs elsewhere. What's the priority there for the Baker administration?

Massachusetts for the last couple of years has been selected by CEOs, surveyed by CEO Magazine, as one of the five worst places in the country to do business. We've got to change that. They're not going to locate here, they're not going to create opportunities here, and they're not going to stay here. And we need to turn that around.

Charlie Baker, we'll be seeing a lot more of you between now and fall of 2010. Thanks for letting us speak to you today.

Happy to be here, Bob. Thank you.