Wall Street Journal informal interview, Harrisburg, pre- re-election November 1982; complete review of first-term issues and accomplishments, October 5, 1982 (55:19) >> Thornburgh: What gets done, of course, time will tell, but there's certainly been changes in the wind. And for the first time, you're beginning to even get some tangible movement with the block grants that were included in the '83-'83. >> Interviewer: I want to ask you about some of those things. >> Thornburgh: Fire away. >> Interviewer: I wanted to ask you about those. But I guess I want to generally ask you, it looks like, unless something just earthshaking happened, you will be working with them in your second term. Why are – [Laughs] -- this is probably a question I should ask near the end of it. Why do you think you're doing so well? >> Thornburgh: [ Laughs ] >> Interviewer: I mean, you look at all the others in Ohio and Illinois -- Illinois is not the cover, but basically, it's my home state. You look at all the other industrial states where there are elections this year, the GOP candidate or incumbent is not doing so well. Why is it different here? >> Thornburgh: Well, I'm probably the worst person to ask for that kind of an analysis, but I know what I like to think. And that is that we have taken a state that was in fiscal chaos and with a very negative business climate and with more than its share of corruption and mismanagement and turned it around in the right direction with some careful attention to each of those areas that can be appreciated, I think, by Pennsylvania voters. Our people here, I think, are looking, in this gubernatorial election, not at the worldwide, international, cosmic questions that the opposition likes to talk about, but what has this governor done for this state? We have gone four years without any tax increase in our general-fund taxes. We've balanced the budget in each of those years without tax increases. And interestingly enough, it doesn't sound like much of an achievement, but we've been able to get our budgets on time four years in a row. That was something that was a lost art in Pennsylvania during the last decade. We had really 1 missed deadlines and budget deficits and even fistfights on the legislative floor that just didn't help our image very much. So, I think people look at that. We have restored integrity to government. People don't wake up every morning expecting to see some high official carted off to prison or, worse yet, being kept on the job. And the first look that I got at Pennsylvania government, as you know, is from the dark underside as a prosecutor of a lot of those folks. So, I have a pretty good sense of how to deal with that. We've enacted a pretty tough code of conduct about conflict of interests in financial interests and things like that. >> Interviewer: How has it been different than perhaps you had expected or when you were thinking about the office? >> Thornburgh: Well, I'm not sure that we expected that we would be as overwhelmed by national and international economic forces. But at the same time, I think that because we've been careful in our management and have worked with business and labor and the civic leadership in the state to improve our business climate that Pennsylvania, among the major industrial states, is about as well- positioned as possible to take advantage of the upturn when it comes. We've not had to increase taxes, as some other states have. And their problems are different than ours. I don't mean to be critical. >> Interviewer: Temporary taxes are a lot. >> Thornburgh: Yeah, we have a 2.2% personal income tax, which was raised the year before I took office from 2.0 and a 10.5 corporate net income tax, which was raised the year before I took office from 9.5%. >> Interviewer: And those lapse next year? >> Thornburgh: Yeah, they've been extended on a -- I guess the last one was for two years. We would like to get the corporate net income tax in particular down below 10%, just as a positive signal. But whether that's gonna be possible or not, I don't have a crystal ball, so I don't really know where we're gonna be going in that respect. But I would like to have that as a positive signal. But our -- It's been tough enough to avoid tax increases during the last four years. And I think that -- What'd the boys figure out? First governor since the one elected in 1946 to go a full term without any increase or sales or income or business taxes. And people recognize that. Taxes are always top-of-the-mind concerns. 2 >> Interviewer: I can't remember. When you were running, did you make a pledge you weren't going to -- You didn't make a pledge. >> Thornburgh: No. No, indeed. No, I carefully avoided that because I didn't know what kind of a fiscal pickle we'd find ourselves in. And we found ourselves in much worse shape than even campaign rhetoric would have indicated. >> Interviewer: And you've had a 1% cutback in state employees. Are you done with them? >> Thornburgh: We have cut the bureaucracy by about 6,000 positions -- over 6,000, which is a 5% or a 6% cut. It's down below 100,000. And we've had -- It's an accumulation of small, incremental efforts to better manage state government. We have a cost-cutting committee in the cabinet that has issued three reports. You might get those reports for Tim. And they've identified about $200 million in annual cost savings that we've been able to implement. And some of them are very small, having to do with how you use the postage meter or how you duplicate things. And others are rather substantial -- getting rid of computer redundancy and things like that. That's been run by our Secretary of General Services Walter Baron, who is a businessman and the prototype of what you can gain from bringing a businessman into office and turning him loose. He was honored by the National Governor's Association out in -- You might have met him out there, Wally Baron. It isn't all that spectacular, but it has been constant and solid in contrast to what we had in the '70s -- spending, taxing, and borrowing as if it was going out of style. We've reduced the state's indebtedness by about $300 million during this administration And yet, at the same time, been able to undertake a very heavy commitment to infrastructure improvement by largely leveraging federal and other funds. We've spent a total -- state, federal, and other funds -- of about $4.5 billion on our roads and ports and other capital expenditures -- mass transit and the like. We have another $6 billion on the books now. So, we have begun, in a very substantial way, the rebuilding of an infrastructure that had fallen into decay here as elsewhere across the country. >> Interviewer: It's interesting, too, because a lot of states have not done a lot of infrastructure work. >> Thornburgh: Well, it was something we identified right at the outset. 3 >> Interviewer: And you do have a lot of deteriorating. >> Thornburgh: Our highway situation's probably the best example, Tim. And I may sound like I'm bragging, but this is a record I'm proud of, and you opened the door. [ Laughs ] Our department of transportation was riddled with corruption. It was bloated at the bureaucracy. We had the highest highway debt in the nation. And yet, we had lost about half a billion dollars to other states in funds that we could not draw down from the federal government. We were 50th out of the 50 states in our drawdown of federal highway funds. And nothing was happening. Under the leadership of a professor, believe it or not, from Penn State University, Dr. Tom Larson, we have rebuilt that operation to the point where it was described earlier this year in the Engineering News-Record, the McGraw-Hill publication that serves that profession, as one of the best managed public-works agencies in the nation. And Dr. Larson received their "Man of the Year" award in highway construction. We are now first in the nation in our drawdown of highway funding. We haven't borrowed a cent. It's been on a current basis by securing the passage last year of an oil franchise tax, which is imposed on the wholesale price of oil, that stabilized our funding at the state level. We had a cents- per-gallon tax only, which meant as consumption went down, as it's going down nationally, we were losing funds. And this summer, we have committed about $750 million to highway construction and maintenance and bridge repair to the point where, of all the areas where there's been a most visible, dramatic change in state government, the highway department leads the pack. And that really is, as an old civil engineer myself, I take particular pride in that. At the same time, the workforce has been reduced by some 1,300 positions, as we've contracted out more and more to the private sector, creating jobs in the building trades and undertaking the kind of classic countercyclical government expenditures during a period of economic slowdown that can be of assistance in dealing with the unemployment.