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August 2, 2011

Host: Ted Simons

Debt Ceiling and Politics

  |   Video
  • ASU Management Professor Gerry Keim of the W.P. Carey School of Business talks about the politics behind the contentious battle in Congress to raise the debt ceiling.
  • Jerry Keim - Management Professor of the W.P. Carey School of Business
Category: Government   |   Keywords: debt, government, ceiling, president, ,

View Transcript
Ted Simons: Good evening, and welcome to "Horizon." I'm Ted Simons. The president today signed a debt limit bill just hours before a deadline that threatened to send the government into default. The debt ceiling had been raised many times in the past, with very little contention. But not this time. Here to talk about what led to politicians to play a very dangerous game of chicken is Arizona state University management professor Jerry Keim of the W.P. Carey School of Business. Thanks for joining us. What are your thoughts on this whole brouhaha with the debt ceiling?

Gerry Keim: I think it's indicative of a bigger systemic problem. It's become more and more polarized, people have very conflicting views on what's best for America. The best organized parts of the party tend to be the most extreme in terms of their ideological position. And for most of the house members, they're very focused on what will happen in the primaries next spring. So they're very concerned about their position on that in those primaries.

Ted Simons: Regarding the primaries, is that the major motivation at play here?

Gerry Keim: Politicians are motivated by a number of things, but I think most of us who watch this process would agree that reelection is certainly one of the most important for most people. And in the primaries you have a very small percentage of the people who are old enough and eligible to vote, so, for example, in the -- you get more turnout when the president is running than in off years. In 2004, Arizona primaries we had about 12% of the people who could vote actually participating. In 2008, we had an unusual situation where there was no incumbent president. So you had competition for the presidency on both sides. So we had 24% of the people who could vote turned out. And the way that worked out, we had about 11% voting in the Democratic primary, and about 13% voting in the Republican primary. So with just two candidates, if you had just two, the winner then would need about 6.5% of the people to support them. If you have more than two candidates, the margins get smaller. So a few people can really make a difference.

Ted Simons: ” We talk about motivation for politicians, what about for the public in the motivation for the voter? Why aren't those numbers higher? Are they happy with the way things are? Doesn't seem like it. Certainly the politicians tell you voters aren't happy. And yet most voters just can't be bothered.

Gerry Keim: Yeah. And there's a lot of different reasons why people don't vote. Certainly moving around frequently, Americans tend to move much more frequently than other folks do. Some states make it more difficult, some states make it easy, to some degree it's culture. You get high turnout in Wisconsin and Minnesota, relatively low turnout in states like Arizona and Arkansas. We are almost always a five percentage points below the national average in terms of voter turnout. Primary elections just don't seem to attract a lot of people. Part of it is I think that we have fewer competitive districts than we did 20 years ago. And the more extreme candidates are the ones that do most successful, so many of the folks in the middle of the distribution don't see a candidate they're attracted to, and don't participate in the primary.

Ted Simons: We often see uncontested primaries.

Gerry Keim: We do. We do see uncontested primaries, though even in the contested ones the contest is often between folks that are taking positions that the moderate would see as far to the left or right.

Ted Simons: Are incentives for politicians on this particular issue, are those incentives different than other issues?

Gerry Keim: Well, this is certainly a very big issue for the Republicans. The best organized part of the Republican party is this Tea Party movement and they're very focused on reducing government spending. So for the Republicans, yeah, this is a huge issue. For the democrats, they've always been the party of supporting entitlement programs for the poor, and for the elderly, but there's not a segment of their party that is quite as intensely vocal on those issues. As the Tea Party is on the Republican side.

Ted Simons: And yet do we know what voters, what the populous, what people think about these extreme positions? Because again, it seems like the extreme positions in this case, we can look back at the '60s and '70s and look at the left, we're looking at the right, it seems like extreme position do really get support.

Gerry Keim: They do. Particularly in the primary election. There's a lot of polling that indicates that the overwhelming majority of people who describe themselves as independent was like to see compromise, more than half the democrats would like to see compromise, but only about 30% of those who indicate the Republicans wanted to see compromise on this particular issue. So the positions are more difficult, and I think there's other changes that have taken place over time, it's far less likely that our elected officials know each other well now in Washington and with the case 20 years ago. Congress is only in session from noontime Tuesday to noontime Thursday, and that's because the members are back in their district and they're back in their district more because there are more and more organized groups that are requesting to see them. And everyone knows that people who are part of an organized group and turn out to see a politician, are people who will vote in the next election. So there's -- they're signaling they're your best customers. If you don't come back and talk with them, you do it as your own peril. And so as a result, people aren't in Washington, they don't get to note members across the aisle, they don't have the relationships they did before, so politics is much more transactional today, where it was more relational 20, 25 years ago.

Ted Simons: For those who say that's a good thing, the extreme positions are a good thing, that people need to hold firm, compromise isn't necessarily the best way to go, how do you respond to that?

Gerry Keim: In a democracy like ours, you've always got to get half of the people involved in the voting process, plus one to get anything done.

Ted Simons: But do you have to? Because it sounds like in this particular debate, the country is full of faith and credit, was not necessarily standing in the way for some folks.

Gerry Keim: That's right. I say to get anything done, and clearly lots of folks didn't want to get anything done. They were very happy with the status quo. And making a point that the ideological stand that would help them in the next election, and then they'll work on changing the attitude of their adversaries over the next two years. But I don't think we're going to see a lot of change in the attitudes of people that have starkly different views about what's the best thing to do for our fiscal policies.

Ted Simons: You see more of the same?

Gerry Keim: I do. Unless we make some fundamental changes, and I'm intrigued with this idea of creating more competition at the primary level, the open primary, so called the top two primary, where you have one primary and let everyone run in that race and everyone vote in that race. And it seems to me it would increase turnout, it would increase the likelihood that people are competing for more of the middle of the political spectrum. They're always unintended consequence was new policy, so it's difficult to see what else might happen, but when I compare it with what we see presently, it's hard to believe that on the margin it's not worth a try.

Ted Simons: Good to have you here.

Gerry Keim: Thank you very much.

Electric Vehicle Project Update

  |   Video
  • The latest on the EV Project - a massive deployment of electric vehicle chargers in the U.S. - with Don Karner, ECOtality North America's President.
  • Don Karner - ECOtality North America, President
Category: Sustainability   |   Keywords: technology, cars, update, electric,

View Transcript
Ted Simons: As car makers continue to produce new electric vehicles, the E.V. project is installing thousands of chargers needed to keep those vehicles running. It's a $230 million program funded in equal parts by the federal government and private industry. I'll talk with the president of the company that's managing the project, but first David Majure introduces us to a valley woman who's taking part in the E.V. project.

Andrea Convey: I remember the first time I drove past a gas station, and it was a really good price come paired to what I had been seeing in the valley. I looked down to see if I needed gas and I'm like, I don't need gas. I don't need gas anymore.

David Majure: That's because Andrea Convey and her husband are the proud owner of the Nissan Leaf, a car that runs only on electricity.

Andrea Convey: Plugging in every night instead of visiting the gas station once a week is really the only difference I can find.

David Majure: Convey charges the car's battery each night. This blink charger in the garage didn't cost the couple a cent, because they participate in the E.V. project. Allowing data to be collected about their charging habits. After five hours, the Leaf is fully charged and ready to roll. How far depends on how it's driven.

Andrea Convey: It's really dependent on speed, acceleration, and air conditioning. City driving with no air conditioning and not zooming by -- at every red light, you can get over 100 miles in this car. Easily. Freeway driving with the air conditioning, you're looking closer to 75 miles.

David Majure: That's more than adequate for her 40-mile round trip to work and home.

Andrea Convey: There was even a day when I had errands to run, I live in north Phoenix, drove out to the queen creek area, downtown Phoenix, and home and the only difference from any other day is planning the route so I had an hour stop at the bookstore and coffee shop in Mesa, bookman's and have a cup of coffee, buy some books, get a little top off so I can make my way home. The E.V. project hopefully will make that easier, and it's building more chargers around the valley. Right now there's just a few, but they are very nicely placed, so that if you are within normal business hours, at least, if you do end up somewhere unplanned, with a quick stop you can top off and get an extra 10 or 20 miles to get you home within 30 minutes or 45 minutes.

David Majure: And perhaps best of all, Convey says charging the car has had little impact on her monthly electricity bill.

Andrea Convey: The car is costing about a penny a mile going 40, 50 miles a day, 50 cents, 50 cents a day, five or six days a week. So it's Negligible.

Ted Simons: Joining me to talk about the rollout of electric vehicle charging stations is Don Karner, the president of Ecotality North America, the company that's managing the E.V. project. Good to see you again. Thanks for joining us.

Don Karner: Thanks it's good to be back on "Horizon."

Ted Simons: Last time we had you here this was still very, very early in the process.

Don Karner: It was.

Ted Simons: The process is underway. How it is going?

Don Karner: It's going well. We're installing chargers in 18 metropolitan areas in the United States. Phoenix and Tucson being two of them. And vehicles are being delivered; we have installed a little over 2,000 chargers in the homes of people that have bought Nissan Leafs. And so things are moving along with that, and we're beginning to install commercial chargers like you saw at Monti's, so that the people can charge away from home and get better utilization of their vehicles.

Ted Simons: To be part of the project, you have to agree to go ahead and maintain, but also monitor and let you guys know and the project know how it's going. Correct?

Don Karner: We ask people to participate in surveys with us, but all of our equipment that was designed for this project is connected to the internet, and collects data on when people charge, how much energy they use, how much power they use, and we correlate that with one of the national labs of the department of energy to study how we can better utilize chargers, how we can better place them, get better vehicle utilization, and essentially what we're trying to do is figure out how for the next 50 or 500 cities in the United States we can get the most efficient deployment of electric vehicle infrastructure. We don't have a lot of resources to waste in this country, and so we want to make sure that when we do deploy infrastructure, we put it where people want to charge. We put it where they can blend that charging in with the rest of the things they do in their life. I like to talk about people having a blink lifestyle. When you bought your cell phone, the first time, there was some anxiety about where am I going to charge it, how am I going to get this charged so I can always use my phone. But very quickly you figured out how to just integrate that into your life. Some people charge at work, I have a charger on my night stand. You just figure out how to make it work. We want to people to dot same thing with their electric vehicle -- we want them to integrate charging their vehicle with what they do with the rest of their life. Where they sleep, where they eat, where they entertain, where they shop, so our idea is to have chargers in all those locations, so they can do that integration themselves.

Ted Simons: Back to the survey, what are you finding out? You mentioned people's habits, but what kind of information are you getting from folks, and are you surprised by some of that information?

Don Karner: Well, it's very early now that we're getting information. We actually just have our second quarter of information. And one of the things that we're seeing that we're pleasantly pleased with is that people at home are charging off peak, so from an impact on the electric utility grid, people are using the least cost energy, they're filling that valley that exists in generation at night, and this is going to be a very friendly thing for the electric utilities. So people are saving money with their electric vehicles by utilizing some of the scheduling features in the charger. You can program the charger to that you can plug it in when you get home at 5:00, but it won't start to charge until, say, 9:00 when the rate goes from on peak to off peak. And we see people utilizing that and doing the off-peak charging. We're just getting start with our commercial charging, and we'll track where people go and which chargers are getting the most utilization, and then try and understand why is that. So that when we place new chargers in new cities, we can try and put them in the most valuable spots.

Ted Simons: And Macy's, Sears, Best Buy, these folks are involved in the project?

Don Karner: Ikea, several large national accounts. These are retailers that are interested in understanding how electric transportation can enhance their business. So we're working with them, sharing data that we collect, helping them to figure out where they can put chargers and how it's going to impact their business. BP is also a partner. So even the petroleum retailers, the oil companies are interested in this shift to electric transportation that is happening in the United States.

Ted Simons: Is there a concern regarding evolving technology in the sense that there could become a charging stations are X and Y right now, but you might be able to get A and B in the near future, or something could change with electric cars? How much of a moving target is that?

Don Karner: Well, the cars will obviously have an evolving technology. Just as in internal combustion engine vehicles have evolved over the last hundred years.But there's a standard that has been agreed to between the electric vehicle charging industry and the automotive industry on how the chargers connect to the vehicle. So one thing you can be sure of is that you can always connect your charger to whatever vehicle you might have, and if you're at Macy's or Monti's, the charger that's there will be able to connect to your vehicle, because it's just like the gasoline dispensing nozzle that has a standard and it fits in your car every time, there's a standard for that connector that Andrea stuck into her leaf to charge it.

Ted Simons: If I have a Chevy Volt, or if I have something else, that works as well.

Don Karner: Same standard will work with that, one charger works with all vehicles.

Ted Simons: I gotta ask you, last time you were here you were a Scottsdale company, are you a San Francisco company, are you a Phoenix company? I heard you moved to San Francisco.

Don Karner: Well, our corporate offices moved to San Francisco, and we have a staff of folks there that include the corporate governance folks, a lot of the creative people, the marketing and the brand folks are there. Our engineering staff is still here in Phoenix, and we've been here for over 20 years. Just south of downtown. So we have a foot in both places.

Ted Simons: All right. Very good. Continued success and good luck. It sounds like things are going well.

Don Karner: Thanks. We're very excited, and happy to be deploying chargers in Phoenix, Arizona.

Ted Simons: All right. Very good.

New Fiesta Bowl CEO

  |   Video
  • Former UA President Robert Shelton talks about his new role as executive director of the Fiesta Bowl.
  • Robert Shelton - Fiesta Bowl, Executive Director
Keywords: universities, football, fiesta bowl, sports,

View Transcript
Ted Simons: Former U of A president Robert Shelton is now officially on the job as are ever executive director of the Fiesta Bowl. Shelton takes over an organization that's looking to clear its image after scandals involving gifts to lawmakers and alleged abuses by previous bowl executives. Here now to talk about his new role is Robert Shelton. Good to have you here. Thanks for joining us.

Robert Shelton: Thanks. Always a pleasure to be with you.

Ted Simons: Last time we were talking education and you weren't wearing quite so loud a jacket.

Robert Shelton: You're right, I had a different color on, but at least people know what I'm standing for with this jacket.

Ted Simons: I think people still want to know, why did you take this job?

Robert Shelton: Oh, so many reasons. If I look back to my days growing up in Phoenix, I've always been keen on college athletics, college sports. The opportunity to get involved with a premier organization like the Fiesta Bowl. The economic impact, the philanthropic impact it has, and then I had a lot of contacts, have a lot of contacts in this arena. I served on the BCS presidential oversight committee, have worked closely with oh, people like Bill Friday who co-chaired the original night commission. So my interest in college athletics, not just for the sport but the impact on universities, for the fiscal questions we're dealing with, and for the opportunities for young people. So it all looked like a terrific opportunity that presented itself, and fortunately I was able to take it.

Ted Simons: I want to ask you, because we alluded to this in the past, we don't have time to get into all the troubles the Fiesta Bowl was fighting off and trying to deal with and was accused of doing here. What needs to change at the Fiesta Bowl?

Robert Shelton: Good question. First point I want to make is, a lot has already changed. There have been a number of personnel changes on the Fiesta Bowl staff. I want to give great credit to the leadership of the current board, in particular, Dwayne Woods. They've gone through and scrubbed everything, they now have extensive governance bylaws that I think will be not tell for other bowl organizations. So first point is a lot has already been done. Secondly, I think moving forward we need to emphasize all the positive impacts that the Fiesta Bowl has had. We're going to watch ourselves carefully, but we're going to demonstrate our value, whether it's through philanthropic work, we'll be announcing some million dollar set of gifts we're giving to charities throughout the state of Arizona. We just saw recent economic impact from one of professor Keim's colleagues at ASU Carey school of management. And the last three bowls that were held here was over $350 million impact on the state, on Maricopa County. And over the last five years, that's been a total of more than $1 billion. So all of those positive things need to come out, as we make sure our house stays in order.

Ted Simons: As far as your staff, what are you telling your staff, what do you think they need to hear and do you think everyone is now on the same page?

Robert Shelton: I'm convinced of that. I've had a meeting before I started with the whole staff, and I'm now scheduling meetings with individuals and with clusters and groups. And I am impressed with the people who are there. Think about the kinds of pressures that they were all under, the staff and the volunteers, remember, almost 3,000 volunteers put this -- these programs on. Think of the pressures they were on and how they performed for three games this last year, so the staff is high quality, they're committed, they're excited, it's an interesting mix of people who have been there many years and people who are relatively new. So I think the staff and the volunteers are a big strength for the Fiesta Bowl.

Ted Simons: Can you rehab, if you will, the Fiesta Bowl, and keep the bowl in the fast lane of college football, keep the good things that you're emphasizing coming? There is some rehab needed here for the Fiesta Bowl, and I want to know if you can do all these things at once.

Robert Shelton: If I didn't think I could do it I wouldn't have taken the job. I'm not doing it alone. I've got great staff, and I know I have a board that supports me. This board has made great strides about their governance, their oversight, with changes in key personnel. We're going to continue to make that kind of progress. They've maintained their reputation with the BCS, they've sort of renewed that appointment. We're going to continue to look at that, because the BCS itself will always be an issue. But my contacts there I think will prove very useful to the Fiesta Bowl.

Ted Simons: How close was the Fiesta Bowl in losing out in the BCS?

Robert Shelton: I can't really say. When I was on the presidential oversight committee, the report by the BCS task force came to that group. I was not part of the task force that wrote the report. And I made sure I recluse myself from any vote. Even before I thought I would be involved with the Fiesta Bowl, I said I'm living in the state of Arizona, I need to recluse myself from this vote. By the time the task force report came to the oversight group, it was clear they had admired what the governing board had done and the changes that had been made to clean up the problems that existed.

Ted Simons: Some see one of the problems and something that could be rehabbed is this business of lawmakers and tickets and this sort of thing. I know there's been an effort to get lawmakers to reimburse the bowl for tickets. Where does the bowl stand on that?

Robert Shelton: I want to be clear. It isn't so much a question of reimbursement, but our following IRS guidelines. And there was a letter that went out last month before I took office that said, you just need to tell us and the IRS what the situation is. We're following tax code. That will continue to clean that up. I think we're out of the business of issuing these kinds of letters now, and we're going to move forward.

Ted Simons: Did you get much of a response from lawmakers?
Robert Shelton: I had one phone call from an individual I admired greatly who said what in the heck are you doing, and I said I don't know, because I was on board and I hadn't seen the letter then. And he graciously sent me a copy of it. And I think clarity is now being achieved.

Ted Simons: OK. You mentioned earlier that you had a history with college football, you enjoyed college football, and you saw the relationship with academia, if you will. A lot of folks see problems with college football right now. Big problems, whether it's USC, whether it's Auburn, Ohio state, North Carolina, everywhere you look you got a coach or some players in trouble. Do you really want to get involved in this? A, and B, what can be done to fix all this?

Robert Shelton: I think one of the attractors, if you will, of this position is I think I will have a chance to have some positive influence on these situations. I don't mean to imply I'm going to fix everything, that's going to come about with president's involvement, commissioners involvement, but it's these headline cases that we all dwell on understandably, and we've got to remember that the 99.9% of the programs out there are working hard, they're clean, they're providing opportunities for young men and young women to excel to get an education to go on in life. So, yes, there are issues, no doubt about it. And I think with my background being connected with a major bowl I'm going to have a chance to weigh in. I'm going to sit at that table, and I think that's a good thing combining the academic side, my career heretofore with the athletic side.

Ted Simons: Are you going to miss academia?

Robert Shelton: Sure. It was part of my life for many years, but I'll still be involved with colleges. What a great opportunity is that?

Ted Simons: Thanks for joining us.

Robert Shelton: Thank you for having me.