ONE-ON-ONE - February 1992
by Alan Kirschenbaum

Reflections on Frankfort
An interview with former Governor Wallace G. Wilkinson

Alan Kirschenbaum: After four years under your administration, how is the Kentucky economy doing as compared to that of other states in the area?

Wallace Wilkinson: Better than most states. There are 36 or 40 states today that are in any financial sense broke. Dealing with crisis after crisis, states are cutting back on funding for education, delaying road programs and infrastructure programs and state employees in some instances are being furloughed.

Kentucky has had to do none of that. Over the past four years we’ve brought in 120,000 new jobs. Now when we net the jobs we’ve lost against that, then we have 60,000 net new jobs over the last four years.

With the possible exception of United Airlines – which I would like to think we did not lose, but had the good sense to withdraw – we did not lose a major economic development competition to another state in the four years I was governor. Whether it be the second Toyota plant or Delta Airlines, North American Stainless, Scott Paper, Teledyne or Seaboard Farms. This new activity, I think, contributed greatly to Kentucky’s insulation from the downward trend of the national economy. It is now beginning to take some toll on us at these late stages in the recession, but not as severely as in other states.

AK: What is your forecast for the Kentucky and the national economy in 1992?

WW: Well it depends upon what happens. If Congress and the White House will recognize the state of the nation’s economy – I mean really recognize it – for its severity; and understand the impact of the deficit financing and how it’s slowing the growth of money; and if they will do something about the 1986 Tax Reform Act. If these recognitions are made by Congress, along with some other measures, in my opinion, we could begin to see some substantial economic recovery in 1992. If these issues are not recognized, I don’t think we will.

AK: Would you suggest complete repeal of the 1986 Tax Reform Act?

WW: Almost. There are parts of it that are all right, but the 1986 Tax Reform Act destroyed the boating industry, almost destroyed the luxury automobile industry, absolutely destroyed real estate, precipitated or at least accelerated the problem with the savings and loans, the banks and the insurance company real estate portfolios.

After those happenings, the examiners went crazy, or nuts whichever term best explains it. This made banks and others afraid to lend, or at least very skeptical about lending, so credit dried up. An excessive amount of real estate, then, was dumped on the market and is now backed up in the pipelines. This has kept real estate developers from having any opportunity, either in terms of leasing, renting, developing or financing real estate. From there it is just a snowball effect. When something happens to real estate, something happens to every segment of the economy.

Take an individual, for example, let’s forget about large corporations for a moment. Forget about real estate developers. Set them aside. Most people have most of their savings and equity in a home. When the real estate market drops so severely, it virtually wipes out the equity and th3e savings that every working man and woman has. This makes them unable to borrow and unable to do a lot of things. This real estate depression has to be reversed.

AK: how would you reverse this trend?

WW: Step one would be to repeal or drastically reform the 1986 Tax Reform Act and give people an incentive to invest again. It all goes to the passive income/passive deduction thing. Until such time that government allows, what we refer to as passive losses (such as real estate, to be offset against active income or ordinary income), people simply have no incentive to invest – especially in the period of time when it doesn’t look like they’ll get a proper yield.

Step two is to put people back to work. This nation drastically needs to rebuild its infrastructure, and as the lead governor with the White House and Congress on transportation issues, I fought very hard for this. We were ultimately very successful in getting the transportation bill that the president signed. You know one month ago he was against it. I testified on any number of occasions before Congress, met any number of times with White House officials, trying to say to them, “Look, let’s put trust back into the highway trust fund.”

The fact of the matter is that money has nothing to do with the budget deficit because that’s money that the states send to the highway trust fund from the gasoline tax. It already belongs to us. The money is there in the fund. They simply would not release it to be spent because they were holding those balances to help offset the deficit. Finally we were successful in getting that done.

Our bridges are crumbling, our interstate highways are falling apart, mass transit is hurting in the urban areas of this country. Put people to work building those bridges and building those roads. Washington needs to go further, they need to supplement that and take all these people who are unemployed and try to get them involved in rebuilding this nation’s infrastructure.

This nation in the last 10 years has just absolutely ignored domestic policy. We have no economic policy, no energy policy, no education policy – we have no domestic policy at all. We’re just floundering and it’s a tragedy.

AK: If the recession continues, which businesses will be most hard hit in 1992?

WW: Until some action is taken, real estate will continue to be hit hard. All businesses will experience some difficulties because credit is difficult, sales turnover is slower, the automobile industry is on its knees, you name it. Jewelry stores, even supermarkets.

AK: What sector of Kentucky will be most hard hit?

WW: All sectors, except the wealthy, but they’ll be hit too – it just won’t hurt them as badly. I see no sector of the economy that is going to escape this. It’s going to hit everybody, it’s going to hit some worse than others. Consumable items that people can do without, they’re going to do without simply because they have no money to buy them. It will affect some more than others and I’ve already named a few; the Thoroughbred industry, real estate, the luxury automobile business – automobiles in general; home sales; anything that people can delay or avoid buying.

AK: On a scale of one to 10, how bad is the recession?

WW: Well it’s certainly a six and maybe a five – with a three being a depression.

AK: If the federal government does expedite some of the changes that you are talking about (such as repealing or reforming the 1986 Tax Reform Act) – then how bad will the economy be on a scale of one to 10 by the same time next year?

WW: If action is not takes, we will certainly be in a full blown recession, the likes of which we haven’t seen in decades, in my opinion. But let me add this in a note of optimism – I do believe that now, finally, legislators and the administration in Washington are beginning to recognize the severity of this recession. I do believe that they are determined now to take steps to bring about recovery; by trying to get the Fed to lower interest rates again, which would increase money supply; by beginning to look at certain tax breaks; and examine and probe certain areas that can help this economy rebound.

As a result of believing that corrective measures will be taken, I have a better outlook on ’92 than most.

AK: What role do you feel state government should play in bringing new business to the region? Should it be all state government or a combination of the state government and the private sector? What has been your approach to this?

WW: Most of the success we have had has been truly a partnership between state government, local governments and the private sector. The private sector is of immense value because when they say, “We’re happy here, we’re treated properly here, we’re prosperous here, we’re profitable here, we’re comfortable here,” that obviously has a lot of impact on another company or another business. So it’s truly a partnership. There’s a certain amount of innovation that has to take place at the state and local level, in terms of the governments and a certain amount of prospecting.

AK: As governor, what type of prospecting did you do?

WW: Our approach was this: We tried to get communities to understand what their resources were and to present those resources in a manner that matched up with needs of certain businesses – then present those resources in a manner that made sense to those companies who were going to create new jobs.

AK: Could you cite some examples?

WW: Tibbals Flooring Somerset, where Somerset actively went out and said, “We have a lot of raw materials, hardwoods. We have the labor available. We have the location available and it will eliminate transportation costs.” They were located in Tennessee, but there is not an abundance of good hardwoods there any more as it exists in Kentucky. So the town of Somerset identified their resources and went to this company and made a presentation that made that company understand that it could possibly be better off in Somerset than somewhere else.

Also, Hughes Aircraft, at the Coldstream location in Lexington, is another excellent example. Any number of places around the world were trying to get Hughes but the presentation of matching Hughes needs with the resources that were available in Central Kentucky in terms of labor, instruction, high technology training and all those things, made it work for Hughes.

Across this Commonwealth right now there is a new competitive spirit. We now know that there is no reason for us to lose jobs to another state. We haven’t in the last four years. Almost any community in this state now, when there is a prospect, will scratch the competition’s eyes out going after that prospect. There has been a rebirth of that competitive spirit in Kentucky in the last four years. I truly believe that.

AK: Under your administration, what incentive were developed so businesses would relocate in Kentucky? As a result, what businesses have come here and flourished?

WW: The list of businesses that came here is long. We took a new approach with incentives. Until 1987, I believe I’m correct in saying that this state required no guarantees from companies.

When my administration came in , we said that we understand that incentives are necessary to be competitive. But when a company tells us that it will create 500 jobs, they have to make that a guarantee4. To the extent that a company does not hold to its promised jobs, it will have to pay us a pro-rata share of that money back.

Secondly, the Kentucky Rural Economic Development Authority Program (KREDA), which gave certain tax incentives to companies that would locate in counties with higher than the state’s average unemployment for the past five years, was a program that no other state had. As a matter of fact, members of the Indiana General Assembly came down to study the KREDA Program, after they had been stunned two or three times by not having a program that could match KREDA and we had taken some companies away from them.

The infrastructure program, which was a new and innovative one that we started, such that we could say to companies that we have a program to take care of your infrastructure needs.

The old Kentucky Development Finance Authority (KDFA) Program, before 1988, allowed loans to be made, I think, only to manufacturing concerns. We changed that in 1990 to give KDFA expanded authority so they could lend to any type of firm that would create jobs, not just manufacturing.

Then came the yen-bond issue, which Investors magazine named the deal of the year. Any number of companies tried to have a yen-bond issue – they were unsuccessful. We were successful. Not only were we successful, but we worked out of the first other series of swaps that we could lend money to companies in any currency and they could repay that loan over a period of 15 years in any currency without penalty. In other words, we fixed the exchange rate on the day of the loan. No matter what happened to the exchange rates over a period of time, they were fixed for 15 years. No one, well I won’t say no one, but it was rare that that had ever been done. We did that with the Industrial Bank in Japan.

General Tire was our first big challenge. When Continental Tire bought General Tire, they walked into my office one day and said, “Governor, we have seven plants and we’re going to close two and keep five, and can you explain to us why we ought not to close the one in Mayfield?” We worked out what I believe was the most innovative program for General Tire. It may be a model. It was very complex.

We told General Tire, “Look, most corporations will not go for lower floaters, because it doesn’t fit in with their long-range planning scheme. You prefer to issue bonds or other instruments of debt with a fixed rate over a period of time. Now as a result of that you pay a lot more interest. We don’t want to have to put $30-$50 million in cash into General Tire, but I’ll tell what we can do. First off, let’s establish what your interest rate would be on your fixed rate bond – then you go on the market, you sell a lower floater. The state will guarantee that the lower floater interest rate, over a period of time – 15 years or whatever – will never exceed your fixed rate that you would have gotten if you had sold fixed rate bonds. In return for that, we want you to agree that when the gap between that lower floater and the London Inter Bank Offering Rate (LIBOR), whatever it might have been that you would have paid, exceeds what we talk about – then you pay the state.

This was the first incentive package ever where the state had an opportunity to make money on the incentive plan without putting out any cash. I believe in 1992, the state will make money on it. So here’s an incentive package where we saved General Tire $40-50 million over 15 years, we didn’t put up a dime in cash and have an opportunity to make cash ourselves on the program.

I could talk about Delta Airlines, Scott Paper, they’re all different. All of those incentive packages were tailored to the needs of the company that we were dealing with at the time.

AK: Some of your critics say you benefited from groundwork laid by Gov. Martha Layne Collins for the Toyota project.

WW: Well, I don’t think that they were criticisms. I think we did benefit. Any governor benefits to some degree from the good things that previous governors did. No question about it, Gov. Collins deserves all the credit for bringing Toyota into Kentucky.

I have no quarrel with those who say we benefited from some things the Collins administration did. We did and I recognize that. We benefited from Toyota as I hope the next administration will benefit from us.

For instance, the Delta Airlines hub. We don’t fully understand yet what the impact will be. In 1993, when Delta will have finished its hub at the Northern Kentucky airport, they will have more gates in Northern Kentucky than they had at the time when they made the deal in Atlanta. Now Atlanta will obviously grow, too.

AK: Why did you withdraw Kentucky from the United Airlines deal?

WW: It was very simple. We withdrew when it no longer made any economic sense. What United was offering was not worth the price. I’ve spent all my life believing that there’s a point beyond which I would rather someone else own something. We reached that point with United.

AK: What did United Airlines offer and what did you want?

WW: Let me tell you a little bit about how the deal evolved over 18 months. I was almost aghast at the way United management handled the whole thing. It was handled poorly. United Airlines came to us and said, “Look we have a proposition. We’re going to build a new maintenance facility for our parts inventory facility and it’s going to create 7,000 jobs. The average salary of those jobs is going to be $45,000 a year and it’s going to be a $1 billion facility. Would you like to bid for this facility?”

“Of course we would,” we responded. Now we ran all the economic models on a computer. We analyzed the situation, considered the costs and the net benefit to this Commonwealth and what we could afford to pay for it and what it was worth. We thought that we could pay somewhere around $300 million over a period of time. That would be $250 million from the state and $50 million from the local community of Louisville and Jefferson County. Then the airport authority and others were chipping in about $40 million for the site, site preparation and all those things.

Now this goes on for 18 months and the deal just keeps changing. Every day, United had a new proposition of some kind.

So, we got down to the wire and went to Chicago for the final meeting. United comes to the table that morning and said, “By the way, it’s not going to be 7,000 jobs. It’s going to be 5,000 jobs and it could be 4,500 jobs because we’re thinking about taking the parts inventory warehousing operation somewhere else.”

Then United says, “Oh, by the way, this $45,000 average annual salary is not in 1994 dollars – it’s in 2004 dollars. Also, that $45,000 in 2004 dollars includes benefits, but we don’t want to guarantee that level of jobs. We think that’s what we’re going to have, but we don’t want to guarantee that. Also, that $1 billion facility is not going to cost $1 billion. It’s more like $700 million. United completely changed the deal.

I’m sitting there listening to all this and I said, “Look gentlemen, you offered us a proposition to which we responded and now you’re changing the deal drastically. The deal is no longer worth anything like the $340 million we have on the table. Its value has been diminished by as much as 40 percent or more. We will have to run the computer models.”

United’s reply was, “Do you mean that you’re not willing to pay $340 million for the new programs we’ve presented today?” To which I responded, “Absolutely, we’re not willing to pay $340 million. It isn’t worth it. We’d never live long enough to get our investment back.”

Then I said we would go back and examine this new proposition and determine what we thought it was worth to us and come back with a new proposal. United replied, “No, if we’re not looking at $300 million up front and $40 million for site preparation, I don’t know if we’re interested.”

This was a lot of discussion, but my basic response to United was, “You’ve revised your part of the deal. If we can’t revise our part of the deal to match it, then we simploy are no longer interested. Goodbye and good luck to you.”

What I have told you up until now is fact. What I’m going to give you now is opinion. I think United saw their deal unraveling.

So United walked in and said, “Indiana, would you take this deal today?” Indiana jumped on it. I think afterward they have had some serious second thoughts about it. I’m not sure that deal is over yet, even though a letter of intent has been signed. But if Indiana thinks it’s worth that much to them, my attitude is good luck and I hope they make it work.

AK: During your term as governor, the press often portrayed your administration as giving contracts primarily to businesses that either made contributions to your wife’s campaign for governor or to yours. Is this the way things are done in American, as well as Kentucky politics?

WW: That’s not the way things are done. I’m not saying it’s never happened, but it’s not the way things are done.

It’s amusing for me to hear the media -- especially this state’s two major daily newspapers – talk about Wilkinson insiders and Wilkinson cronies. Every one of those cronies and insiders tried to beat me in 1987. None of them were for me. I didn’t get a dime from any of them when I was running in the primary in 1987.

Every single one of those people and those companies, engineers, lawyers, architects, highway contractors that the press refers to as Wilkinson insiders, tried every way they knew to beat me. They made all of their contributions to the other candidates. I’ve been amazed by the fact that there’s never any mention or criticism or cynicism about the contributions they made to the other candidates. Well, they made none to me. I virtually had to finance my campaign for the primary. A fundraiser for me in 1987, was when Wallace Wilkinson sat down and wrote a check to my campaign.

After I won the primary, everybody came to contribute. We didn’t even have to solicit contributions. They were ready. You couldn’t find a Democrat in this Commonwealth that wasn’t for me after the May, 1987, primary. Almost every firm that had ever done business with the state contributed to my campaign, just as they have contributed to campaigns before that.

Never in a single instance did my administration trade contributions for contracts. We didn’t have to, we had no reason to and wouldn’t have. Now, these two daily newspapers completely missed my election in 1987. I mean, they just completely missed it. They were embarrassed about it. They never forgave me for it.

AK: Why?

WW: They just missed my election. They endorsed other candidates and it embarrassed them. They have spent almost every day since then trying to prove, somehow or other, that they were right. As a result of that, I have had to deal with super-cynicism and a prosecutorial attitude that has just been unbelievable.

The Herald-Leader and The Courier-Journal from 1987 forward, championed no issues. They weren’t out in front of the educational reform act. We addressed it and we led the nation in it. They weren’t out in front for rebuilding the infrastructure. My policy has been the best ever in the history of this Commonwealth. They weren’t out in front of the environmental management plan we passed, the first one since the cabinet had been formed 15 years ago. They weren’t out in front on economic development. We had a four-year record of economic development that was almost unparalleled in this nation. We led the entire Southeast in the first quarter of 1990 in new manufacturing jobs created. Kentucky never beat states like Florida, Georgia, North and South Carolina, Alabama, Louisiana and Tennessee and all the rest – the press has never even written that much about it – they championed no issues, especially all the things we were trying to do in 1988.

So, the Herald-Leader and The Courier-Journal couldn’t criticize us for solving the prison problem. They couldn’t criticize me on workforce development. We were the first state in this nation to have a cabinet level workforce development program. The press seized upon contributions and campaign finance as their issues of choice.

Now, with respect to your other question, this is not the way politicians do business. It would appear so if you read the papers, but that’s not the case. I suspect, going forward into the future, that we will still have to have no-bid contracts. I would just as soon it be changed and we bid everything. Or at least I feel the system should be changed so that nobody else goes through the misery I did. I don’t have a solution, but we’ll see what happens.

The same people contributed to Gov. Jones and we’ll just see how he deals with the issue. Yes, the same people contributed to him that contributed to me, that contributed to Collins, that contributed to Brown. Campaigns cost too much. As long as they continue to cost too much, people are going to have to raise money. And as long as people raise money, these people are going to contribute. For my part, I’d just as soon pass a law that says you can’t spend anything on campaigns – nothing. Just go around the state and have a TV debate every other night in some different part of the state – period. For my part, I love to debate the issues anyway and the way to resolve it is to just say you can’t spend anything on campaigns. You can travel, you can give stump speeches, but no spending – it would suit me just fine.

Now let me address one other thing – public financing of campaigns is not the answer. It’s not good use of taxpayers’ money. Instead of giving a bunch of taxpayers’ money to a bunch of politicians so they can send them junk mail or 30-second TV ads, that money ought to be spent on education or some other good purpose.

I ask you -- in 1976, we started public financing of presidential campaigns – does anyone believe that there is any less influence by special interests in Washington today than 1976? People are going to contribute to campaigns. I’ve contributed to campaigns all my life. But for my part, I’ll play by any rules they want to establish.

AK: Are you saying that the Herald-Leader and The Courier-Journal chose to criticize you on no-bid contracts because they couldn’t criticize you for anything else?

WW: They had nothing else they could criticize me on. Th3ey settled on campaign finance and contracts for contributions because that’s the only thing in which they could get their teeth into.

Almost, every single firm that was qualified to do business with this Commonwealth got work in my administration. We had so much work – schools, parks, all kinds of buildings, roads and water lines. We gave almost everybody plenty of work. Check the record. Some of the better ones, for those particular projects, got more work.

So all of a sudden, I was looking around and the newspapers were focusing on the amount of money we were raising. Like everybody else we raised money for the Governor’s Derby parties and Derby guests, we raised money to promote the lottery, we raised money for the inauguration and any number of other things.

AK: Why did you have such an adversarial relationship with the General Assembly?

WW: Because I wanted to change Kentucky. I wanted to change the way we educated children. I wanted to change the way we did business in this state. I wanted to compete again.

AK: What changes did you want that the General Assembly did not want?

WW: Nearly every one – just pick one.

AK: Education?

WW: As I say, almost any area. They objected to the expanded KITHA authority. Sen. Moloney had an outcry over the yen-bond issue and is still sore today because we had the authority on the KITHA legislation to do that. He missed it and didn’t understand it and then when he found out we were having a yen-bond sale, he objected to it strenuously.

There was a great compromise in my office, where I was willing to trade the sales tax for the services tax – which I regret to this day. For this, the Assembly agreed to pass my road bond issue; the community development bond issue, which funded the expansion of the Lexington Civic Center and the World Trade Center and others.

My budget intact, I may be the first governor in recent memory that got every line item in my budget passed. Had it not been for that compromise, they would have beaten all of those things. The sales tax was the way I found to do it.

AK: Wasn’t it your election platform to not raise taxes?

WW: I said that I was not going to keep throwing more money at the same old stuff. Until such time that we can get education and other areas of this government in a position that it has an opportunity to improve, I will not put one more dime into it.

But in September, 1987, in the Lexington Herald-Leader, I said if we can get a reform package passed, get our schools in a position that they have an opportunity to improve, then I will fund them.

AK: Are you saying that you raised taxes because of the Education Reform Act?

WW: Of course. That’s the only reason. What I proposed to do was fix our revenue base. Kentucky has always been behind the eight ball because our revenue does not grow as our economy grows. The service sector is the fastest growing sector of the economy. Until such time that we tie the service sector to our revenue base, our revenue will never be able to grow as our economy grows. The sales tax is a flat tax.

The most hypocritical act that I have seen in my life was when The Courier-Journal, for two years, pounded and pounded and pounded and pounded on me to raise taxes to fund our schools. I proposed a service tax – it took them 24 hours to come out against it. I said at that time that they never saw a tax they didn’t like until they saw one they had to pay. It would have taxed advertising.

My question at the time was, “Is there justice in asking a lady, who’s going into a store to buy a pair of blue jeans for her children going to school, saying, ‘Lady, five percent isn’t enough. You have to pay six percent.’?” Then turn around and say to that company that spent $10,000 advertising those blue jeans, “You don’t have to pay anything.” That is what I call taxing the wrong people. It’s wrong-headed.

Anybody who knows anything about the economy or economics will agree that a sales tax is a regressive tax, a service tax is a progressive tax.

AK: Why?

WW: Because the service sector is the fastest growing sector of the economy. The people that pay the services tax are the ones who can best afford to pay it. Architects, engineers, lawyers, advertisers – those type of people. The sales tax falls squarely upon the people who can least afford to pay it. The biggest regret that I have is that we imposed the wrong tax. We taxed the wrong people. We should have had the services tax and not the sales tax increase.

AK: Do you feel the General Assembly was acting on behalf of the special interest groups rather than the people of the Commonwealth?

WW: Well, the Assembly was reacting to the pressure being applied from the special interest groups. Every night, cable TV ran that little crawler across the bottom of the screen that said, “If the services tax passes, you will have to pay a dollar more for your cable TV service.” Advertisers, the Kentucky Press Association, lawyers, architects, engineers all went bananas.

The average person hires a lawyer one or two times in his life; when he buys his house or when he gets a divorce or some sort of thing. It’s corporations and businesses that pay most of the lawyers fees and government. Those are the people that do not need to be exempt to the sales tax.

Now let me explain to you how that works. The sales tax applies to everybody – services too. But they’ve been given a special exemption from it. Why should they be exempt from a tax everybody else has to pay? That’s special interest legislation.

Everybody thought I was so “snuggy snuggy” with the architects, engineers and contractors. They absolutely abhorred this tax I was trying to put on them. The tax was already there. I mean everybody abhorred the fact that I wanted to pull back this exemption. You know, it was amusing to me to have engineer and architect groups in my office upset that I wanted to take away their exemption – then the next morning pick up The Courier-Journal and read that I was doing things for engineers and architects in return for campaign contributions. It was really amusing and at times frustrating.

AK: If you were to be governor again, theoretically, starting all over, what would you do differently regarding your relationship with the General Assembly; your relationship with the press and your relationship with Kentucky’s business community?

WW: I think I had a pretty good relationship with the Kentucky business community.

The thing that I would try to do differently is to communicate better. I had never held public office before, had never been a candidate before. I simply did not, early on, communicate well enough. As a result, people didn’t understand what I was trying to do. And that includes my relationship with the press.

Look, let me admit in this same interview my own shortcomings. I could have done a better job with the media. I thought that they were treating us unfairly, that they were super-cynical, that they were prosecutorial, that they were vindictive and I should have tried harder to reconcile our differences. I didn’t.

I had all of these interest groups out there fighting me on many of my programs and policies. I simply did not communicate as well as I should have, or perhaps could have, in terms of trying to explain to people what I was trying to do, which was restructure schools and reform education, get the state’s economy moving again and to try and insulate Kentucky as well as I could from this recession; trying to get our revenue base in a position so that it would grow as the economy grew; trying to get Kentucky in a position where it could compete internationally; trying to get those transportation projects done so that we could rebuild our infrastructure – all of those things. What always came out was, “This guy wants to issue bonds because he wants to repay someone who made a contributions.” That was just terrible.

For instance, when I went after the road bond issue to build the roads that had been promised and needed in this state for 30 years. You could hear the General Assembly saying, “Ah – this guy wants to issue all these bonds because he wants to help the bonds brokers. He wants to repay bond council.” That was the furthest from my mind. I wanted to build the two legs of the Double A highway and 25E and U.S. routes 23, 119 and 127 and the road from Bowling Green to Cadiz and rebuild the county bridges program.

The biggest regret that I have in being governor is that we imposed the wrong tax. We taxed the wrong people. We should have had the services tax and not the sales tax increase.

AK: What was your single biggest accomplishment during your administration?

WW: Ending the neglect of rural Kentucky – counties like my own. These were parts of the state hat had been neglected for a long, long time. I wanted to move us all forward together.

For example, we haven’t had a road built in my home country since 1955. There were no jobs. Schools were below par. There were no factories or industry. I tried to focus and create opportunity for everybody.

This was probably my single greatest accomplishment. It would be easy to say education reform or economic development, but I think that listening and paying attention to people that had been neglected was it.

AK: Do you think that is why you came under fire from the special interest groups, just by that reason alone?

WW: Yes, I think that might be part of it. I came to Frankfort to change things. I said early on that I didn’t come to Frankfort to get along. I came to Frankfort to build consensus. I went to Frankfort to build roads, schools, water lines, infrastructure, mobs and better education.

A child that was in the first grade when I was elected in 1987 is today in the fifth grade. Now the questions are these: Does that child have a better opportunity to get a better education today than it did in 1987? Are we traveling on better roads and bridges today than we were in 1987? Do more areas of this state have access to clean water today than we were then? Do we have better environmental management? Are our prisons in better shape? If the answers to those questions turn out to be “yes,” then I’ve done a good job. If it turns out to be “no,” then I haven’t. But I didn’t go to Frankfort to make the special interests and the General Assembly comfortable and I didn’t make any bones about it.

AK: Your self-appointment to the University of Kentucky Board of Trustees met opposition from faculty, students, the press and others. How did that make you feel?

WW: Well, I would much rather have had them say, “Welcome aboard. Together we’re going to figure out how to do it better.” All of my life I’ve always had, for some reason, some group of people telling me I can’t do something.

They first told me I couldn’t get out of Casey County. Secondly, they told me I couldn’t attend the University of Kentucky. Thirdly, they told me I couldn’t be successful in business. Then they told me I couldn’t be elected governor.

I don’t need the glory of being on the University of Kentucky board. I’ve been governor. I don’t have to have that. I don’t need the basketball tickets – I already have them. I certainly don’t need any more misery in my life from opposition from certain groups, but the next frontier of education reform is higher education. There are some questions I want to ask that nobody else is asking.

AK: What are those questions?

WW: I do not understand why the cost of a higher education is escalating faster than almost any other cost in this nation, including health and medical coverage. When inflation is going at three and four percent a year, why is the cost of higher education escalating nationwide at 20, sometimes 30 percent a year. It makes absolutely no sense. It goes, I think, to how we properly utilize both our human and financial resources. It’s time to debate on why the cost of higher education is escalating so rapidly.

Also, public educational institutions are publicly chartered to dispense education, promote learning and public service. What is the proper public role for a university that is funded with public funds?

Then there is a whole range of student and faculty issues I would like to confront. Many of our full-time tenured faculty members are not even involved in basic instruction anymore. Our students at the freshman and sophomore levels are all being taught by teaching assistants who are basically English speaking foreign students. Some students don’t have access to full time tenured faculty anymore.

I am pro-research. But, we can no longer afford the luxury of having our best faculty out of touch with our student body. They have to get involved again in undergraduate teaching. There is nobody who disagrees with that. I want to differentiate research, which benefits this Commonwealth and our citizens, and research that just furthers someone’s career.

I’m not going to go in there and propose that I have all of the solutions. But, I would like to begin this debate. This is the next frontier of educational reform.

If our education reform program works, universities are going to be getting a different type of student. They are going to begin getting a student who has been an active participant in his learning process; not just passive, but an active participant. If they’re still confronted with the old lecture method of teaching, those students are going to be bored. They’re going to be ahead of that and they’re not going to appreciate it very much.

I can remember going to class at UK – it’s been a long time ago – but, my professor wouldn’t even show up. We had an AV screen and some teaching assistant would come in and show slides. It’s pretty hard to talk to a slide machine.

Also, our colleges are going to have to start producing a different type of teacher. The state right now is faced with the proposition of spending millions of dollars to retrain teachers in this new education environment we’re going to have. We ought not have to retrain teachers. Teachers ought to be trained when they leave UK. There’s nothing wrong with continuing education, but teachers who have gone through the colleges of education have spent four years learning methodology and they’ve got to know more about their subject matter. They’ve got to know how to deal with site-based management and with outcomes rather than with just inputs.

The institutions of higher education, not only did not lead the education reform movement, they weren’t even involved in it. Today, they’re scrabbling around trying to find out what it’s all about and to participate in it. It just passed them by.

AK: What are your future plans?

WW: I have two sons that I want to finish getting through college. One of them has another year and the other has two. I’ve been asked to stay involved on a national level with national transportation issues and I think I will. I’ve been asked by any number of national groups to stay involved with the national education reform movement, especially the SAT-ED (Satellite Education) group, where we’ve been trying to get the federal government to get us an education satellite. I’m going to continue to push for that.

Also, I have a whole bunch of businesses that I have virtually neglected for five or six years. I’m getting reoriented.

I want to participate in this presidential election coming up. I want to find a candidate who will be good for this nation’s economy and that will help this Commonwealth.

AK: Who do you think is going to be the Democratic nominee for president?

WW: Well, I don’t know yet. My opinion is that it will lie between Bill Clinton and Mario Cuomo. I expect at this time that Cuomo will run. Bob Kerry is a prospective candidate. You know, all of the Democrats have got a good message. My final analysis is that it will probably be between Clinton and Cuomo.

I want to help somebody who will straighten out this nation’s economy and help Kentucky. As soon as I can figure out who I think can do that best, I’m going to offer my services, if they want them. I’m going to try to raise some money for them. I wonder if they’ll say I’m trading contracts for contributions? I truly believe after four more years of Republican economics it may be too late for the nation to recover.

Alan Kirschenbaum is the former editorial director of The Lane Report.
editorial@lanereport.com

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