Horizon, Host: Ted Simons

January 25, 2010


Host: Ted Simons

Arizona State Parks

  |   Video
  • State parks are in a life or death battle for their existence as state lawmakers look for ways to cut the budget. Renee Bahl, Executive Director of Arizona State Parks, will talk about the dire situation.
Guests:
  • Renee Bahl - Executive Director, Arizona State Parks
Category: Culture

View Transcript
Ted Simons: The Arizona State parks board voted recently to close 13 of 27 state parks. The closures were needed after lawmakers swept $8.6 million from the state parks budget. In a moment, I'll talk to the director of the state parks, but first, here are some public comments made at the parks board meeting before the decision to close the parks was made.

Karen Washabau: Riordan MANSION STATE PARK HAS IMMEASURABLE VALUE TO ARIZONA. THE CITY OF FLAGSTAFF, WHO WE MET WITH, OTHER CULTURAL ORGANIZATIONS UP THERE AND PRIVATE DONORS WANT TO KEEP RIORDAN PARK OPEN.

Charles Adams: I'M GENERALLY AN ARCHEOLOGIST, NOT JUST MULLVIEW, WHERE I'VE DONE MY RESEARCH. THERE ARE A TREMENDOUS AMOUNT OF ARCHEOLOGICAL SITES ON STATE PARKS. THERE'S A GREAT CONCERN IN THE ARCHEOLOGICAL COMMUNITY ABOUT PROTECTION OF THESE IF SOME OF THESE PARKS CLOSE. THEY'RE EXTREMELY VULNERABLE.

Joni Bosh: AS A FORMER BOARD MEMBER, I'VE BEEN WATCHING THIS ISSUE AND HAVE BEEN APPALLED AT WHAT I SEE THE LEGISLATURE DOING. I'M TOTALLY SYMPATHETIC TO THE HARD FIGHT Y'ALL ARE IN. THIS IS NOT AN EASY ISSUE. I'M SO WORRIED THAT IF YOU DO START CLOSING PARKS, I'M THRILLED TO SEE THE TURNOUT TODAY, BUT AS YOU HEARD FROM EVERYONE HERE, CLOSING THESE PARKS IS SOMETIMES A ONE-WAY ROAD. I THINK IF YOU CLOSE SOME, YOU RISK VANDALISM, YOU RISK LOSS OF PARKS WHERE EASEMENTS ARE GOING TO BE VIOLATED, YOU'RE LOOKING AT LOSS OF INCOME TO THE NEARBY TOWNS THAT WE'VE BEEN SUCH AN ATTRIBUTE TO AND YOU'VE LOST INCOME INTO THE STATE. I DON'T THINK THERE'S A GOOD ANSWER HERE BUT I THINK ONE OF THE ANSWERS MIGHT BE TO TAKE ADVANTAGE BY ALL OF THESE OFFERS MADE BY VOLUNTEERS TODAY TO KEEP THE SYSTEMS OPEN.

Carol Cullen: WE WOULD ALSO LIKE TO ASK THAT YOU CREATE A MECHANISM SO THAT A NONPROFIT OR THE NONPROFITS IN OUR COMMUNITIES CAN ASSUME RESPONSIBILITY FOR OUR PARK, RATHER THAN PRIVATIZING IT. LET US DO IT. LET US SUBMIT THE BUSINESS PLAN TO KEEP IT GOING UNTIL YOU CAN REOPEN IT.

William Muir: IF I WERE THE MANAGER OF THIS OPERATION, IF I WERE THE CHIEF OPERATING OFFICER AND I SAW THIS GOING ON, I WOULD MAKE ARRANGEMENTS TO SELL YOU. I WOULD LAY OFF THE MANAGEMENT. I WOULD THINK OF WAYS TO GET RID OF CAPITAL EQUIPMENT AND I WOULD SELL THE PARK SYSTEMS TO PRIVATE INDUSTRY WITH THE COVENANT THAT YOU COULD BUY IT BACK AT A LATER DATE. CLOSE IT ALL, GIVE ALL THE MONEY BACK TO THE STATE, BE HEROES, HELP THEM WITH THEIR STATE BUDGET PROBLEMS.

Ted Simons: Joining me now is the director of state parks, Renee Bahl. RENEE, GOOD TO SEE YOU AGAIN.

Renee Bahl: THANKS FOR HAVING ME.

Ted Simons: TWO-THIRDS OF STATE PARKS COULD BE CLOSED BY EARLY JUNE.

Renee Bahl: YES. THE PARKS BOARD TOOK ACTION EARLIER THIS MONTH TO CLOSE 13 STATE PARKS. THAT LEAVES NINE OPEN AS WE ALREADY HAD A FEW CLOSED. WE'RE IN A VERY DIRE FINANCIAL SITUATION RIGHT NOW. CANNOT AFFORD TO KEEP THEM ALL OPEN.

Ted Simons: THE DECISION TO CLOSE X BUT KEEP Y OPEN, WHAT WERE THE CRITERIA THERE?

Renee Bahl: SIMPLY DOLLARS AND CENTS. WE LOOKED AT THE PARKS WITH THE HIGHEST REVENUE OR NET REVENUE TO OPERATE OR A VERY LOW NET COST AND THOSE WERE THE PARKS THAT WERE RECOMMENDED TO STAY OPEN. WE DIDN'T LOOK AT ANY OTHER VALUE OF THE SYSTEM.

Ted Simons: SO BASICALLY THE COSTS AND THAT'S THE BOTTOM LINE. DO THOSE PARKS MAKE ENOUGH MONEY TO WHERE IN THE FUTURE MAYBE SOME OF THE CLOSED PARKS COULD COME BACK ON-LINE?

Renee Bahl: THAT'S CERTAINLY OUR HOPE. IF THEY MAKE A LITTLE MORE MONEY THAN THEY SHOULD COST TO OPERATE. SO IN THE LONG RUN, MAYBE MONTHS OUT OR A YEAR OUT, WE WOULD HOPE TO BRING ANOTHER PARK OR TWO INTO THE SYSTEM, ONE WE MOTHBALLED ESSENTIALLY. WE'RE MOTHBALLING ALL THE PARKS.

Ted Simons: WHAT HAPPENS WHEN A PARK IS MOTHBALLED? WHEN YOU HEAR CLOSING A STATE PARK, WHAT DOES THAT MEAN?

Renee Bahl: WELL, THERE'S NO MODEL TO FOLLOW. THIS IS THE FIRST SYSTEM LOOKING AT THIS GREAT CLOSURE. OUR NUMBER ONE PRIORITY WOULD BE TO PROTECT THE RESOURCE. WE'LL DO WHAT WE CAN AT FACILITIES TO CLOSE THEM OFF. EACH ONE WILL HAVE A DIFFERENT SET OF CIRCUMSTANCES. DO WE ADD A SECURITY SYSTEM? WHAT DO WE DO WITH WELLS? WHAT DO WE DO WITH THE WASTEWATER TREATMENT PLANT? AND THEN TRY TO SECURE THE SITE. WE'RE REALLY GOING TO RELY ON VOLUNTEERS TO KEEP AN EYE ON IT.

Ted Simons: WELL, IT SOUNDS LIKE THAT'S A LOT OF WORK, WHICH WOULD COST A LOT OF MONEY JUST TO CLOSE THE PARKS.

Renee Bahl: IT'S A FALLACY TO THINK THAT THERE'S NO COST ASSOCIATED WITH CLOSING A PARK. WE'LL HAVE ONE-TIME COSTS TO CLOSE IT AND THEN ONGOING OPERATING COSTS TO KEEP A PARK CLOSED, SAFE AND SECURE.

Ted Simons: WE TALKED ABOUT SWEPT FUNDS. WHERE DID THESE FUNDS COME FROM THAT WERE SWEPT BY THE LEGISLATURE?

Renee Bahl: THE THREE MAIN FUNDS THAT WERE SWEPT, ONE IS CALLED THE ENHANCEMENT FUND. IT'S OUR GATE FEES WHEN YOU DRIVE INTO A PARK OR CAMP OR TAKE A TOUR. WE TYPICALLY GENERATE ABOUT $8 MILLION A YEAR AND OVER $2 MILLION WAS SWEPT. THAT'S THE FUNDS WE USE TO OPERATE THE PARKS. THEN WE HAVE CONSERVATION TAXES, LIKE THE STATE LAKE IMPROVEMENT FUND AND THE HERITAGE FUND AND THEY HAD ANOTHER 2 AND $4 MILLION SWEEP RESPECTIVELY.

Ted Simons: WHEN PEOPLE THINK THIS IS MONEY THAT THE GENERAL FUND GIVES TO PARKS AND IS NOW TAKING BACK, THAT'S NOT THINKING RIGHT, IS IT?

Renee Bahl: IT'S NOT. WE DON'T RECEIVE ANY GENERAL FUND. WE WERE CHALLENGED THIS LAST FISCAL YEAR IN THE SUMMER TO OPERATE MORE LIKE A BUSINESS. SO WE CUT BACK ON OPERATIONS, WE CLOSED CERTAIN PARKS TWO DAYS A WEEK, WE ELIMINATED MANY WORTHY STATEWIDE PROGRAMS AND WE RAISED OUR FEES TO OPERATE MORE LIKE A BUSINESS. THAT INCLUDED ELIMINATING STAFF. WE MOVED ALONG AND HERE IN DECEMBER, THAT MONEY THAT WE HAD GENERATED IN OUR BUSINESS WAS TAKEN. THEY TOOK THE 'TIL.

Ted Simons: WHEN YOU SAY OPERATE MORE LIKE A BUSINESS, SOME WILL SAY, LET'S GO AHEAD AND PRIVATIZE. MANY FOLKS ARE THINKING ABOUT THAT PRIVATIZE THE PARK. WHAT DOES THAT MEAN? IS THAT A VIABLE OPTION, DO YOU THINK?

Renee Bahl: I DON'T THINK IT'S A VIABLE OPTION TO PRIVATIZE TO WHOLE SYSTEM. PRIVATE CONCESSIONAIRES WOULD OFTEN LOOK AT THE BOTTOM LINE. THEY LOOK AT THE PROFIT THAT THEY MAKE. OVERALL OUR SYSTEM WASN'T DESIGNED NOR DOES IT MAKE A PROFIT. THE WHOLE STATE PARK SYSTEM WHEN IT'S OPEN. ABSOLUTELY, THERE IS ROOM FOR PRIVATE CONCESSIONAIRES AT OUR PARKS. WE HAVE THEM NOW. THEY'RE VERY SUCCESSFUL. TO OFFER AMENITIES THAT THE PUBLIC COULDN'T GET OTHERWISE. BUT OVERALL, A PARK SYSTEM, A STATE PARK SYSTEM ISN'T DESIGNED TO MAKE MONEY AND A PRIVATE CONCESSIONAIRE WOULDN'T LIKELY TAKE OVER A STATE PARK SYSTEM.

Ted Simons: SO CONCESSIONS POSSIBLY, BUT THE ACTUAL OPERATION DOESN'T MAKE SENSE TO YOU.

Renee Bahl: IT DOESN'T, NOT ON A STATEWIDE BASIS.

Ted Simons: IF THAT'S THE ONLY WAY LAWMAKERS CAN FIND TO KEEP THESE PARKS OPEN, IS
THAT THE ONLY WAY TO KEEP THEM OPEN?

Renee Bahl: WELL, WE'RE HAVING VERY POSITIVE CONVERSATIONS WITH SOME COMMUNITIES, LOCAL COMMUNITIES TO HELP US OPERATE THE PARKS OR OPERATE IT IN THE SHORT-TERM HOPEFULLY UNTIL THE END OF THE RECESSION. YAVAPAI COUNTY HAS BEEN A GREAT PARTNER. WE'VE HAD CONVERSATIONS WITH YUMA. CAMP VERDE PUT MONEY ON THE TABLE AND SAID IT'S NOT AN OPTION FOR PORT VERDE TO BE CLOSED. WE'VE HAD MANY POSITIVE CONVERSATIONS LIKE THAT AS WELL.

Ted Simons: WE'RE LOOKING AT THE TERRITORIAL PLACES RIGHT THERE WHICH IS ONE OF THE PLACES THAT WILL CLOSE. IT SOUNDS AS IF -- TALK ABOUT THE IMPACT TO YUMA, TO ALL OF THESE SMALLER TOWNS, TO PAYSON, STRAWBERRY. TALK ABOUT THE IMPACT THAT THESE PARKS HAVE ON THOSE COMMUNITIES.

Renee Bahl: IF YOU LOOK AT IT STATEWIDE, OPEN PARKS BRING IN $266 MILLION OF ECONOMIC IMPACT ANNUALLY. THOSE COMMUNITIES RELY ON VISITORS THAT COME TO THE PARKS, THEY GO TO THE RESTAURANTS, THEY GO TO THE GROCERY STORE, THEY SPEND MONEY IN THE COMMUNITY WHEN THEY COME TO THE PARK. WITHOUT THAT INFLUX OF VISITORS COMING IN, MONEY IS NOT GOING TO BE SPENT. AT YUMA PRISON, FOR INSTANCE, WE HAVE ABOUT 60,000 VISITORS ANNUALLY. WHEN YOU THINK ABOUT IT, THAT'S OFTEN THE FIRST PLACE PEOPLE STOP WHEN THEY CROSS THE BORDER. YUMA NEEDS THAT AND THEY KNOW THAT THEY NEED THAT.

Ted Simons: ARE YOU WORKING WITH LIKE RED ROCK STATE PARK? ARE YOU WORKING WITH SEDONA RIGHT NOW TO SEE IF THEY CAN TAKE ON MORE, IF NOT ALL, OF THIS BEAUTIFUL, BEAUTIFUL PARK?

Renee Bahl: SEDONA IS A WONDERFUL PARK. WE'RE TALKING ABOUT SEDONA. WE'VE TALKED WITH YAVAPAI COUNTY. WE'RE TALKING WITH THE BENEFACTORS THERE. ONE OF THE PROBLEMS IS NOBODY HAS MONEY NOW. WE'RE NOT NAIVE TO THAT. IT'S NOT LIKE THESE CITIES AND TOWNS ARE FLUSH WITH MONEY. WE'RE DOING EVERYTHING WE CAN TO TRY TO KEEP SOME SEMBLANCE OF THIS SYSTEM.

Ted Simons: IS THERE ANY TALK OF A LICENSE PLATE SURCHARGE? WE HEARD THAT A WHILE BACK. ANY TRACTION THERE?

Renee Bahl: THERE IS. THERE ARE A COUPLE OF BILLS THAT WILL BE INTRODUCED THAT ONE HAS A MANDATORY FEE ON LICENSE PLATES AND ANOTHER ONE WOULD BE REFERRED TO THE VOTERS. SO WE'RE HOPING THAT THAT CONTINUES THE TRACTION AND WE FIND A SUSTAINABLE LONG-TERM FUNDING SOURCE.

Ted Simons: WHAT ABOUT QUALITY OF LIFE SALES TAXES OR TAXES LEVIED AGAINST TOURISM
AND THESE SORTS OF THINGS?

Renee Bahl: I HAVEN'T HEARD ANYTHING ABOUT THAT. I KNOW THERE'S OTHER TALK OF SALES TAX. REALLY WE'VE BEEN FOCUSED MORE ON THE LICENSE PLATE.

Ted Simons: THE KEY, LAST TIME WE HAD YOU ON AND WE TALKED ABOUT THIS, THE KEY SEEMS TO BE FINDING A DEDICATED FUNDING SOURCE FOR THE PARKS. IS IT OUT THERE? CAN YOU FIND IT?

Renee Bahl: NOT WITH THE REVENUE STREAMS THAT ARE OUT THERE NOW. IT WOULD NEED TO BE SOMETHING NEW AND IT WOULD NEED TO BE DEDICATED AND SOMETHING SECURED. TODAY I WOULD ARGUE THE ONLY SECURED FUNDING SOURCE IS THE ONE THAT IS VOTER PROTECTED.

Ted Simons: AND THE IDEA OF VOTER PROTECTION, WHICH WE'LL TALK ABOUT THAT TOMORROW ON "HORIZON" IS UP FOR DEBATE NOW. JUST IN GENERAL, WHAT ARE PEOPLE LOSING WITH THESE PARKS CLOSING? TALK ABOUT A COUPLE ALREADY. I KNOW SLIDE ROCK AND HAVASU AND CATCHER IN ARE STAYING OPEN. THOSE ARE SOME OF THE biggies. SOME OF THESE OTHER PLACES, WHAT WILL PEOPLE NOT BE ABLE TO SEE?

Renee Bahl: IF YOU LOOK AT A PLACE LIKE YUMA OR TOMBSTONE, THAT'S THE HISTORY OF ARIZONA. YOU GET A HISTORY OF WHERE WE WERE BEFORE AND WHERE WE ARE TODAY. EVEN SHUTTING A PARK DOWN FOR A FEW MONTHS OR SHORT-TERM, YOU'RE ALSO LOSING THE HISTORY THAT THE STAFF HAS TO TELL THE STORY SO PEOPLE CAN KEEP TELLING THE STORY. THAT'S AN IMPORTANT RESOURCE THAT WE NEED TO REMEMBER AS WELL. OUR STAFF RIGHT NOW, WE HAVE A LITTLE OVER 200 STAFF, HAVE 2,600 HOURS -- YEARS OF SERVICE WITH ARIZONA STATE PARKS. 2,600 YEARS.

Ted Simons: AND YET, CRITICS WILL SAY THERE'S STILL TOO MUCH BUREAUCRACY. YOU GOT TO TRIM, YOU GOT TO BE MORE EFFICIENT. HOW DO YOU RESPOND?

Renee Bahl: WE ARE TRIMMED. WE ARE MORE EFFICIENT. WE'RE OPERATING PARKS ONLY THAT MAKE MONEY AND NOT PARKS THAT REPRESENT THE ARIZONA STATE PARK SYSTEM.

Ted Simons: DO YOU THINK THERE'S A LACK OF UNDERSTANDING, WE CAN INCLUDE LAWMAKERS IF YOU LIKE, BUT A LACK OF UNDERSTANDING AMONG ARIZONANS AS TO WHAT STATE PARKS ARE, WHERE THEY ARE AND WHAT THEY DO FOR THE COMMUNITIES?

Renee Bahl: I THINK THERE'S PROBABLY CONFUSION OR MUDDLING BETWEEN A NATIONAL PARK, A STATE PARK OR CITY AND COUNTY PARK. ALL THE PARKS ARE IMPORTANT AND OPEN SPACE AND HISTORY IS IMPORTANT. STATE PARKS ARE THE GEM OF ARIZONA. THAT'S WHAT IS UNIQUE TO ARIZONA, AND THE NATIONAL PARKS ARE UNIQUE TO THE NATION THAT ARE FOUND IN ARIZONA. AND TOGETHER THESE TWO ARE WHAT BRING TOURISTS IN. WE ARE -- WE ARE VERY IMPORTANT PART OF THE TOURISM INDUSTRY HERE, AND ARIZONA NEEDS TO KEEP PUSHING THAT TOURISM INDUSTRY. THAT'S WHAT WE HAVE NOW. THAT'S JOBS ON THE GROUND TODAY.

Ted Simons: LAST QUESTION. ARE YOU OPTIMISTIC THAT SOMETHING CAN HAPPEN TO GET SOME FUNDING BACK TO THIS PARKS DEPARTMENT?

Renee Bahl: I HAVE TO BE OPTIMISTIC. YOU KNOW, YOU CAN CUT OUR BUDGET BUT YOU CAN'T CUT OUR SPIRIT.

Ted Simons: ALL RIGHT. WE'LL LEAVE IT RIGHT THERE. THANK YOU SO MUCH FOR JOINING US. WE APPRECIATE IT.

Renee Bahl: THANK YOU.

Congressman Jeff Flake

  |   Video
  • The latest news from Capitol Hill with Arizona Congressman Jeff Flake.
Guests:
  • Jeff Flake - U.S. Congressman


View Transcript
Ted Simons: Good evening and welcome to "Horizon." I'm Ted Simons. The president's state of the union address is set for Wednesday, this as Congress works on health care reform and tries to find ways to push an economic recovery. Joining me to talk about congressional issues is U.S. representative Jeff Flake from Arizona's 6th congressional district. THANKS FOR JOINING US.

Jeff Flake: THANKS FOR HAVING ME.

Ted Simons: WHAT DO YOU WANT TO HEAR FROM THE STATE OF THE UNION ADDRESS?

Jeff Flake: A REVERSAL CERTAINLY WITH HEALTH CARE. I HOPE THE PRESIDENT ACKNOWLEDGES THAT WE CAN'T GO WHERE HE WANTs IT TO GO. THAT THEY'LL PAIR BACK AND ENTERTAIN SOME OF THE PROPOSALS THAT REPUBLICANS HAVE PUT FORWARD. THAT'S WHAT I THINK WE WOULD LIKE TO HEAR WITH HEALTH CARE. ALSO, HEAR THAT THEY'VE ABANDONED CAP AND TRADE. NOT GOING TO GO THERE EITHER. AND WE'RE GOING TO HAVE SOME KIND OF CERTAINTY AHEAD FOR THE BUSINESS COMMUNITY, SOME KIND OF BUSINESS CLIMATE THAT IS CONDUCIVE TO ECONOMIC GROWTH AND JOBS. IF WE DON'T HEAR THAT, THEN WE'RE IN FOR MORE OF THE SAME.

Ted Simons: LET'S TALK ABOUT ECONOMIC GROWTH. SOUNDS LIKE THE PRESIDENT WILL BE CONCENTRATING ON THE MIDDLE CLASS. WHAT HE SAID TODAY, THE MIDDLE CLASS HAS BEEN UNDER ASSAULT FOR QUITE AWHILE. DO YOU THINK THE MIDDLE CLASS IS UNDER ASSAULT?

Jeff Flake: WELL, I THINK IT WAS UNDER ASSAULT WITH THE HEALTH CARE BILL, FOR
EXAMPLE. THAT WOULD HAVE INCREASED TAXES ON SOME OF THE MIDDLE CLASS, DEPENDENT ON THE KIND OF PLAN THEY HAD. SMALL BUSINESSES CERTAINLY WOULD BE FACING EITHER 8% INCREASE OR DEPENDENT ON HOW THEY'RE ORGANIZED, MAYBE 5.4% SURTAX ON TOP OF THAT. THAT'S MIDDLE CLASS. THAT'S PEOPLE WHO FILE AS A SUB S CORPORATION, FOR EXAMPLE. THAT'S MIDDLE CLASS. THAT'S THE SMALL BUSINESS COMMUNITY. YES, THEY'VE BEEN UNDER ASSAULT, BUT MOSTLY BY GOVERNMENT.

Ted Simons: BUT THE CBO AND OTHERS ARE SUGGESTING THAT IF THESE REFORMS COME INTO PLACE, THAT ACTUALLY HEALTH CARE COSTS WOULD BE REDUCED AND, THUS, THE MIDDLE CLASS --

Jeff Flake: THAT ONLY ASSUMES --

Ted Simons: CBO ESTIMATES, YES.

Jeff Flake: AND CBO HAS TO TAKE CONGRESS AT ITS WORD AND YOU SHOULDN'T. FOR EXAMPLE, THEY SAID WE WOULD CUT $500 BILLION FROM MEDICARE OVER TEN YEARS. WE WILL NEVER DO THAT. SO SIMPLY ADD TO THE DEFICIT. THEN YOU HAVE INTEREST RATE ISSUES AND OTHER THINGS THAT HIT THE MIDDLE CLASS EVEN HARDER.

Ted Simons: SOUNDS AS IF HE GETS TO HEALTH CARE ON WEDNESDAY, LOOKS LIKE HEALTH CARE REFORM WILL CHANGE INSURANCE COMPANY PRACTICES AND NOT QUITE AS MUCH OF AN EMPHASIS ON EXPANSION OF CARE. DOES THAT MAKE SENSE TO YOU?

Jeff Flake: THAT'S PROBABLY WHAT THEY'LL DO. I THINK THEY'LL TAKE MORE POPULAR PARTS OF THE HEALTH CARE PLAN AND PASS THEM INDIVIDUALLY AND DECLARE VICTORY.

Ted Simons: SOUNDS LIKE, I WANT TO GET YOUR RESPONSE IN EXTENDING THE LIFE OF MEDICARE. YOU KIND OF ALLUDED TO THAT EARLIER. A GOOD IDEA? VIABLE?

Jeff Flake: EXTENDING THE MEDICARE?

Ted Simons: YES.

Jeff Flake: YOU HAVE A LOT OF PEOPLE PAYING INTO MEDICARE. YOU HAVE TO CHANGE THE TRAJECTORY HERE BECAUSE IT'S SIMPLY UNSUSTAINABLE AS IT IS. UNLESS WE HEAR SOME REAL REFORM IN PROPOSALS, THEN WE WON'T EXTEND THE LIFE.

Ted Simons: REFORM PROPOSALS THAT YOU WOULD LIKE TO SEE?

Jeff Flake: YES. YOU HAVE TO. WE CAN'T SUSTAIN THE PATH WE'RE ON WITH MEDICARE. THE EXPENSES ARE SIMPLY OUTSTRIPPING WHAT WE'RE PUTTING INTO IT. WHEN YOU LOOK OUT-OF-CONTROL ENTITLEMENTS, MEDICARE IS FAR AND AWAY THE BIGGEST CULPRIT, FAR BIGGER THAN SOCIAL SECURITY. I HAVE TO SAY AS REPUBLICANS, WE DIDN'T DO WELL. SOME OF US ADDED ON PRESCRIPTION BENEFITS, SOME OF US DIDN'T VOTE ON IT BUT WE ADDED IT. IT ADDED TENS OF TRILLIONS OF DOLLARS OVER THE NEXT 75 YEARS, MADE MEDICARE EVEN MORE UNSUSTAINABLE. WE'VE GOT TO GO THE OTHER DIRECTION THERE.

Ted Simons: WELL, SO IF THE PRESIDENT ON WEDNESDAY OFFERS SOMETHING ALONG THE LINES OF HELPING SENIORS WITH PRESCRIPTION DRUGS AND THESE SORTS OF THINGS, IS THAT SOMETHING YOU THINK, AGAIN, IS VIABLE OR JUST NOT THE TIME FOR IT?

Jeff Flake: UNLESS YOU OFFSET IT SOMEWHERE ELSE, SAVE IN REFORMS SOMEWHERE ELSE, IT'S NOT VIABLE.

Ted Simons: CAP ON OUT-OF-POCKET EXPENSES, AGAIN, HEALTH CARE.

Jeff Flake: AGAIN, IT'S NICE TO SAY THESE THINGS. BUT UNLESS YOU REFORM THE WHOLE SYSTEM, UNLESS YOU DO THINGS LIKE -- THERE ARE THINGS THAT COULD BE DONE. FOR EXAMPLE, REPUBLICANS HAVE BEEN PUSHING FOREVER AND JOHN SHATTUCK IN FRONT OF THE PACK SAYING, WHY NOT ALLOW INDIVIDUALS TO PURCHASE HEALTH CARE ACROSS STATE LINES? WOULDN'T COST ANYBODY ANYTHING. IT WOULD SIMPLY INCREASE COMPETITION AND LOWER COSTS, BUT THEY DON'T WANT TO GO THERE. DEAL WITH TORT REFORM. THEY DON'T WANT TO GO THERE. THEY DON'T SEEM TO WANT TO GO ANYWHERE WHERE THERE MIGHT BE ACTUAL COST SAVINGS. THEY SIMPLY WANT TO SAY WE'LL CAP OUT-OF-POCKET COSTS. THAT SIMPLY SHIFTS THE COSTS FROM THOSE PAYING PREMIUMS ON TO TAXPAYERS. AND SO UNLESS YOU REALLY REFORM THE SYSTEM, YOU CAN'T JUST pander TO THE PUBLIC AND SAY, WE'RE GOING TO MAKE COSTS LESS -- CARE LESS COSTLY.

Ted Simons: CAN YOU DO FREE MARKET REFORMS, THOUGH? THIS IS ALMOST A UNIVERSAL AGREEMENT, THAT THOSE WITH PRE-EXISTING CONDITIONS HAVE TO BE ABLE TO FIND HEALTH INSURANCE SOMEWHERE. THAT IS A FLAW. BUT CAN YOU HAVE A PRE-EXISTING CONDITIONS INCLUDED IN REFORM AND NOT MAKE EVERYONE GET INTO THE SYSTEM, EVERYONE INTO THE BOAT? HOW DO YOU MAKE SURE -- DO HEALTHY PEOPLE ALL WIND UP HERE, THE PRE-EXISTING CONDITION PEOPLE WIND UP HERE, THE ILL HEALTH -- I MEAN --

Jeff Flake: UNDER THE REPUBLICAN PROPOSAL, WHAT WE DID WAS WE GAVE INCENTIVES TO STATES WHO FORM A RISK POOL. SOME STATES HAVE TOO FEW OF THEM NOW, TO CARE FOR THOSE WITH PRE-EXISTING CONDITIONS. WHAT YOU CAN'T DO IS SAY, INSURANCE COMPANIES, YOU HAVE TO COVER ALL PRE-EXISTING CONDITIONS, NO STIPULATIONS THERE. THAT JUST MOVES INSURANCE FROM TRUE INSURANCE, A HEDGE AGAINST RISK, TO KIND OF PUBLIC UTILITY. AND IF THAT'S WHAT YOU WANT TO DO, THEN SAY IT AT LEAST, BUT DON'T PRETEND THAT WE'RE SIMPLY GOING TO AND WE CAN BY FIAT, TELL INSURANCE COMPANIES YOU HAVE TO COVER ALL PRE-EXISTING CONDITIONS AND IT WILL LOWER THE COST FOR EVERYBODY. IT'S NOT. IT WILL INCREASE IT SUBSTANTIALLY. I SAY, IF YOU'RE GOING TO DO IT, AND WE DO NEED TO DEAL WITH PRE-EXISTING CONDITIONS, DO IT SEPARATE FROM REGULAR INSURANCE CARE. AND SO YOU SIMPLY DON'T INFLATE THE COST FOR EVERYBODY ELSE. BECAUSE IF YOU REQUIRE INSURANCE COMPANIES ALL TO COVER PRE-EXISTING CONDITIONS, YOU HAVE RAISED PREMIUMS FOR EVERYBODY, THE MIDDLE CLASS AND EVERYBODY.

Ted Simons: SO WHAT PAYS FOR THOSE WITH PRE-EXISTING CONDITIONS?

Jeff Flake: IF YOU ESTABLISH -- WHAT WE REPUBLICANS DID IS SAID, ALL RIGHT, STATES YOU HAVE MONEY. WE DID IT WITH SAVINGS THAT WOULD COME FROM TORT REFORM. THE BEST ESTIMATES THERE ARE BETWEEN 50 AND I THINK $200 BILLION OVER TEN YEARS THAT COULD BE SAVED IF WE ENACT A REAL TORT REFORM.

Ted Simons: REAL TORT REFORM, ARE YOU SAYING TORT REFORM ITSELF COULD PAY FOR MUCH OF THIS?

Jeff Flake: YES. THAT'S WHAT -- THAT'S HOW REPUBLICANS IN THEIR PLAN FREED UP SOME MONEY TO DO THESE STATE RISK POOLS, IS BY ENACTING TORT REFORM.

Ted Simons: LET'S GET BACK TO THE ECONOMY AND THE PRESIDENT'S IDEA OF MAYBE A
CONSUMER FINANCIAL PROTECTION AGENCY. GOOD IDEA?

Jeff Flake: NO. PROBABLY NOT. NOT THE WAY -- WELL, I GUESS I'LL HOLD THE JUDGMENT UNTIL I SEE THE DETAILS. AN AGENCY THAT DUPLICATES THE THINGS WE'RE ALREADY DOING, WE MAY SEE SOMETHING LIKE THE DEPARTMENT OF HOMELAND SECURITY. WE'LL CONSOLIDATE OTHER AGENCIES AND STREAMLINE PROCEDURES AND WE HAVEN'T SEEN IT AT ALL. ANOTHER AGENCY JUST TO PILE ON WHAT TO OTHER AGENCIES ARE ALREADY DOING WOULD PROBABLY NOT BE A GOOD IDEA.

Ted Simons: BUT ARE THESE OTHER AGENCIES DOING ENOUGH? WERE THEY DOING ENOUGH WHEN THE WHOLE FINANCIAL SYSTEM SEEMED READY TO COLLAPSE?

Jeff Flake: NO DOUBT. THERE ARE A LOT OF THINGS THAT SHOULD HAVE BEEN DONE. BUT I DOUBT ADDING A NEW AGENCY NOW IS GOING TO FIT THE BILL, PARTICULARLY GIVEN WHERE THE ADMINISTRATION SEEMS TO WANT TO GO HERE. WE HAVEN'T -- MY -- MY DIFFICULTY IS IF WE TRULY HAVE BANKS, FOR EXAMPLE, THAT ARE TOO BIG TO FAIL -- AND THAT WAS A PROBLEM BEFORE -- WHAT ARE WE DOING TO MAKE SURE THAT WE DON'T HAVE INSTITUTIONS THAT ARE TOO BIG TO FAIL? I HAVEN'T SEEN ANY REAL EFFORT TO ADDRESS THAT. INSTEAD, WE'RE SIMPLY SAYING WITH THE, FOR EXAMPLE, THE FINANCIAL REGULATORY REFORM THAT'S BEEN INTRODUCED BY BARNEY FRANK, SIMPLY HAVE A PERMANENT BAILOUT FUND. ASSUME WE'LL ALWAYS HAVE COMPANIES, BUSINESSES TOO BIG TO FAIL AND THEY HAVE A PERMANENT BAILOUT FUND TO DEAL WITH THAT. THAT'S THE WRONG DIRECTION TO GO. IF WE TRULY HAVE BUSINESSES TOO BIG TO FAIL, THEN FIND A WAY TO DEAL WITH THAT SPECIFICALLY, INSTEAD OF JUST SAYING, WE'LL BE BAILING THEM OUT FOR DECADES TO COME.

Ted Simons: IT SOUNDS AS IF, ONE FINAL THING, THE PRESIDENT WILL PROBABLY TALK ABOUT IS THE TENOR, THE TONE OF WASHINGTON, THE PARTISAN BICKERING BACK AND FORTH, IF YOU WILL. CONGRESSIONAL QUARTERLY WEEKLY CAME OUT WITH THE IDEA THAT YOU HAD VOTED AGAINST THE PRESIDENT'S EXPRESSED WISHES MORE THAN ANY OTHER HOUSE MEMBER IN THE ENTIRE BODY. THOUGHTS ON THAT.

Jeff Flake: I HAVEN'T AGREED WITH THE PRESIDENT'S DOMESTIC AGENDA. SOME OF THE INTERNATIONAL THINGS I AGREE WITH THE PRESIDENT QUITE A BIT. HIS EFFORTS TO LIFT THE TRAVEL BAN OR LIFT RESTRICTIONS ON TRAVELING TO CUBA, HIS WILLINGNESS TO TALK TO SOME LEADERS AROUND THE WORLD OUR PREVIOUS ADMINISTRATION WANTED TO TALK TO, I THINK THAT'S GOOD. DOMESTICALLY, I HAVEN'T FOUND MUCH I LIKED WHAT THE ADMINISTRATION HAS DONE. AS FAR AS BEING PARTISAN, THOUGH, I DON'T THINK THAT I'M ANY MORE PARTISAN THAN ANYONE. I GO TO THE WHITE HOUSE, PLAY BASKETBALL WITH THE PRESIDENT. I LIKE HIM AS A PERSON, AND I JUST THINK THAT THE AGENDA IS ALL WRONG.

Ted Simons: ASKED THE QUESTION BECAUSE CRITICS WILL SAY, AND DEMOCRATS SPECIFICALLY WILL SAY, THAT IT'S -- THEY CAN FIND SOME FOLKS THAT THEY CAN AGREE WITH, BUT NO ONE IS AGREEING WITH HIM BECAUSE IT SEEMS THE REPUBLICAN PLAN IS TO OPPOSE AT ALL TIMES TO QUICKLY REGAIN POWER. RESPONSE.

Jeff Flake: THAT COULDN'T BE FURTHER FROM THE TRUTH. THERE HAVE BEEN TIMES WHEN I'VE SEEN PARTISANSHIP IN WASHINGTON AND ONE PARTY SIMPLY STANDS UP AND SAYS, LET'S NOT OFFER ANY ALTERNATIVES. LET'S JUST VOTE NO. BUT THIS ISN'T IT. REPUBLICANS THIS YEAR HAVE OFFERED ON HEALTH CARE, PROPOSAL AFTER PROPOSAL AFTER PROPOSAL. THERE ARE IN THE REPUBLICAN STUDY COMMITTEE, I THINK THERE'S SOME 70 BILLS THAT HAVE BEEN PROFFERED ON HEALTH CARE ALONE. SO WE HAVE ALTERNATIVES. BUT WHEN YOU HAVE BIG MARGINS, LIKE THE ADMINISTRATION DOES IN CONGRESS, LIKE THE DEMOCRATS DO IN CONGRESS, THEN IT FORCES -- DOESN'T FORCE THEM TO ACTUALLY DEAL WITH THE OTHER SIDE. WHEN YOU HAVE 60 VOTES IN THE SENATE AND A 40-VOTE MARGIN IN THE HOUSE, IT DOESN'T FOSTER COOPERATION VERY MUCH. I HAVE TO SAY THAT I WAS PRETTY HARD ON MY PARTY WHEN WE governed. I THOUGHT HOLDING THE VOTE, BEATING THEM OVER THE HEAD WAS WRONG. I THOUGHT THE WAY WE HANDLED THE PROCESS WAS WRONG. TODAY, FOR EXAMPLE, WE WENT THROUGH THE WHOLE YEAR LAST YEAR WITHOUT HAVING AN OPEN RULE ON APPROPRIATION BILLS TO ALLOW MEMBERS, ANY MEMBER, REPUBLICAN OR DEMOCRAT, TO OFFER THE AMENDMENTS THAT THEY'VE WANTED TO ON ANY APPROPRIATION BILL. THAT'S THE FIRST TIME IN THE HISTORY OF THE REPUBLIC THAT WE'VE HAD ANYTHING EVEN CLOSE TO CLOSED RULES ON APPROPRIATION BILLS. AND SO THIS MAJORITY IN THE HOUSE WITH A 40-VOTE MARGIN HAS NOT FELT THE NEED TO REACH OUT.

Ted Simons: CONGRESSMAN FLAKE, THANKS FOR JOINING US.

Jeff Flake: THANKS FOR HAVING ME.

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