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CNN "CNN Newsroom" - Transcript


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BALDWIN: In Detroit, more than half of the city's schools could be shutting down forever, the school system's budget in the hole by about $327 billion. So a plan is on the table to close a total of 70 schools in the next couple of years. That would be on top of dozens of other schools that closed just last year.

But get this. If that happens, there would be a whopping 60 kids to each high school class. Coming up, we're going to get a live report from Wisconsin, where all of this anger over budget cuts began.

But, first, pretty busy day for Ohio Governor John Kasich. Late this morning, he was there in Cleveland to greet the president. President Obama, we should mention, campaigned against him, but Governor Kasich is there to greet him, nonetheless, as the president lands in Ohio to push his jobs initiative.

Meanwhile, and we have been talking about this throughout the last hour, unionized workers -- and there they are -- and our correspondent estimated 10,000, perhaps 15,000 of them descending on Ohio's capitol today, labor unease in another state in the heartland.

And Governor Kasich supports this plan, supports this Senate Bill 5 to eliminate collective bargaining rights for state employees.

And despite his busy schedule, and I know he is's on the road going from city to city at the moment, he's kind enough to pick up the phone and call me.

So, Governor Kasich, I appreciate that, first and foremost.

GOV. JOHN KASICH (R), OHIO (via telephone): Well, I'm glad to be with you.

BALDWIN: But I want to ask, these workers say that you are using the state's budget crisis as an excuse, as a scapegoat to bust the unions. What do you say to that?

KASICH: Well, I mean, look -- yes,that's not why I'm doing it.

And, look, we have an $8 billion budget deficit in Ohio. I mean, that is just unprecedented. We have lost 600,000 jobs over the period of the last 10 years. Only Michigan and California have done worse. And we're in a situation here where we have got to restore entrepreneurship and job creation.

And so the collective bargaining legislation, which is really designed to restore some power to the managers that run our state, that run our local governments, that run our schools, is just one piece of a very significant reform program that you will see when I unveil my budget on March the 15th, designed to put the state in a position where we can create jobs and restore entrepreneurship and get Ohio moving again.

BALDWIN: I think people would agree with you that the $8 billion budget hole that your state is in is massive and folks on the other side would agree on job creation, but I want to specifically talk to you about negotiating.

In fact, we talked today to a union worker there at the capitol. I want you to listen and have you respond to this.



JIM BENEDICT, OHIO DEPARTMENT OF JOBS AND FAMILY SERVICES: I think we should bargain and we should sit down at the table and come up with an equitable solution. They -- they say they want to pay -- they are paying 14 percent of our pension now -- 14 percent of our salary into the pension. They want to pay less.

That may be an acceptable solution. We may have to pay more towards our pension. We're only paying 10 percent now. There may be some bargaining in there and some room to negotiate.


BALDWIN: So, Governor, they are saying they have compromised in the past. We know they...

KASICH: Well...

BALDWIN: Hang on.

(CROSSTALK) BALDWIN: We know they compromised under Governor Strickland. They say they are willing to compromise again.

In fact, I spoke with State Senator Capri Cafaro last hour. She said she wants to sit down at the table with you, sit down at the table with Republicans and negotiate.

Why won't do you that?

KASICH: Well, first of all, look, the bill that we have in effect rights now was passed on a strict Democratic Party line vote 30 years ago. We're not saying that people shouldn't be able to sit down and talk about their pay, but you let -- you have to let managers be able to decide what's the appropriate level of contributions for pensions. That should not be negotiable.

It shouldn't be negotiable that people get step increases and COLA increases. Managers need to be able to manage their costs and that's exactly what we're proposing.

BALDWIN: I understand we're talking about SB5 and I understand this thing went into effect.


KASICH: Hold on. Hold on. Let me -- let me finish.

BALDWIN: This is my show. Hang on a second.

KASICH: Yes, but you asked a question and I just want to finish answering it. And what I'm trying to say is

BALDWIN: Go ahead.

KASICH: -- I am all in favor of people being able to talk, but there are some things that shouldn't be negotiated. There's things that managers need to control.

BALDWIN: But I have to jump in.


BALDWIN: But I have to jump in because -- and I understand, but on the flip side, and you're saying you want to balance. You're saying that the power was with labor with this bill decades ago, and now, those would say why not then negotiate? Why legislate, why strip their right to negotiation all together?

KASICH: Well, there are some things they should be able to talk about, and there are some things that appropriately belong in the hands of management. Look, there's arbitration. There's a situation where an outsider comes in and imposes a settlement on a community that they can't afford. It drives up costs. It drives up taxes and it loses job.

So, what I'm suggesting is, we're doing is narrowing the scope of bargaining. That's appropriate to let management do what management does. And on the issue of pay and perhaps some other items, I'm not opposed to people being able to talk.

Let me just suggest to you that if we do not get a handle on pensions, if we do not get a handle on health care, a lot of these employees could ultimately be left high and dry, and I don't want to see that happen.

BALDWIN: Some of the employees, including, and I'm just speaking with State Senator Cafaro, she had mentioned simply the fact that closing the budget deficit, which I think you agree with and she agrees with, she was saying that there really is no connection, that there is sort of a fabricated connection between the budget crisis and eliminating collective bargaining. How do you respond to that?

KASICH: Well, that's not exactly right, and I have a lot of regard for Senator Cafaro. But, look, we believe that at least in the last year, it's -- the collective bargaining agreements have driven up our costs by a couple hundred million dollars. And in addition to that, local governments are going to get fewer resources from us. Part of this is to give managers the tools to decide what they want to do.

Now, if you're running a city and you want to give organized labor, you can. If you also are a manager and you need to control your budgets, then don't deny them the tools. And, by the way, I come from a labor town. And this is not any effort on my part to try to go after organized labor. It is all part of a package designed to let Ohio succeed, because we have been getting crushed.

This is not the only answer to our package, but it is a tool that will help local governments. It is a tool that will help the state, and I think it's totally appropriate.

BALDWIN: You have a budget crisis which you mentioned. Also, you mentioned the figure 600,000 jobs out of your state in the last I think it was 10 years. So, you have a jobless crisis as well, right?

KASICH: Right.

BALDWIN: So, you propose to cut taxes, you propose to cut government, but hasn't that always been your agenda, Governor Kasich regarding -- really I should say, regardless of the prevailing economic conditions?

KASICH: Well, you know, in 1997, I was the chief architect of a program that I helped to negotiate with the Clinton administration that resulted in the first balanced budget, the paying down of the most amount of the national debt in modern history. We cut taxes on risk-taking in investment and we had one of the most prosperous times in our history. Doesn't that make sense?

And I was -- I fought for that for 10 years against Republicans and Democrats. And for that program, we got it. We were successful.

I'd like to take the same philosophy to Ohio, and all these things will work together, I believe, to get us out of the hole. The Midwest is getting crushed by the South and the Southwest, and we need to have a more pro-growth, job-creating environment. And this, in addition to all the other reforms, I believe will put us on that track.

BALDWIN: And you mentioned jobs. We know, you know, another Democratic president, President Barack Obama was in your -- you know, your neck of the woods today, talking jobs -- did you get any face time with him? Did you talk at all about any of this with Mr. Obama?

KASICH: Yes. I was -- look, President Obama came to Ohio 12 times to work against me, and it didn't work, and I -- when I was invited to be on the tarmac, I thought out of respect for him and out of respect for his position, I needed to be there.

It's his first visit since I've been governor. It was good to see him. I saw my old buddy James Sperling, had a little hug right there, and I'm going to be seeing the president this weekend at National Governors Association.

So, you know, I like President Obama. He's a smart guy, and I was glad to be there to -- to pay him the respect that he deserves.

BALDWIN: Well, Governor John Kasich, we appreciate you and your busy, busy day of going from city to city to pick up the phone and talk about the issue. Clearly, you're passionate and so are a lot of other people. But I appreciate it.

KASICH: Oh, that's right. Thank you for having me on.

BALDWIN: Thank you. Thank you.


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