So far in what may best be described as an “engagement phase,” Haley’s primary public decisions have been to select teammates to run Cabinet agencies. Her selections, which still have to be confirmed by lawmakers, have engendered everything from genuine praise from both sides of the political aisle in the Senate to a calmer wait-and-see approach from some of those who’ve disagreed with her in the past.

Step one

Haley got off to a good start, according to several sources, when she named former House Speaker and U.S. Ambassador to Canada David Wilkins as the chair of her transition team.

Considered the ultimate state parliamentarian, Wilkins reportedly smoothed jagged legislative nerves that Haley would continue the cold relationship between the Governor’s Mansion and the Statehouse, and extend her strident rhetoric from her primary win.

Since tacking more to the middle, Haley has continued to make political nominations that signal she is her own governor and not simply Mark Sanford in a pantsuit or Sarah Palin in another state.

So far, Haley has nominated:

• Robert “Bobby” Hitt to be Secretary of Commerce;
• Judge William Byars as the head of Corrections;
• Catherine Templeton to head up Labor, Licensing and Regulation;
• Margaret Barber to lead Juvenile Justice;
• Anthony Keck as the executive director of Health and Human Services;
• James F. Etter as leader of Revenue; and
• Lynne Rogers to head up Probation Parole and Pardons.

Other Cabinet agencies that Haley may fill with new blood: the departments of Alcohol and Other Drug Abuse Services; Insurance; Motor Vehicles; Parks, Recreation and Tourism; Public Safety; Social Services; and Transportation. The State Law Enforcement Division also is in the Cabinet, but Haley won’t have a say there for a couple of years due to state law. 

According to Statehouse sources, Haley’s decision to name Byars to head up Correction was a slam-dunk. Why? Because not only is Byars considered eminently professional by Senate leaders like Brad Hutto (D-Orangeburg), but because it would remove current Director Jon Ozmint from office.

Ozmint had been one of the least popular members of Sanford’s cabinet amongst legislators, who decried his agency’s mounting deficit, but also perceived an arrogance toward many legislators.

Message received

Sen. Larry Martin (R-Pickens), usually a constant critic of Sanford, said this week he was generally impressed with Haley’s selections. While admitting he didn’t know all of the nominees, he said what he had seen so far led him to believe they “will receive prompt hearings before committees and be referred to the floor as quickly as possible.”

Sen. Phil Leventis (D-Sumter) is taking a wait-and-see approach – instead of a search-and-destroy method he seemed to favor with Sanford. “I want to see how they work as a team,” he said.

Leventis said he expected the strident rhetoric of Haley’s primary campaign would likely fade away completely once she takes office. “There’s nothing ‘rhetorical’ about running state government. It’s about paving roads, keeping prisons open and paying for schools.”

Beaufort Republican Sen. Tom Davis, one of the most ardent supporters of Sanford, said he hoped Haley would make good on her campaign promises to keep state government spending in check, pointing to the hole he thinks the state dug itself by accepting federal stimulus money to expand state Medicaid programs.

About the only Haley nominee who has so far received any harsh criticism has been Anthony Keck, tabbed to head DHHS after serving as a deputy director of a similar Louisiana agency. 

Senate Democratic Caucus director Phil Bailey worried that Keck’s background would lead him to fight for stepping the state away from Medicaid. “If he does that, then he’d be ensuring that 800,000 South Carolinians would continue not to have health care insurance,” said Bailey.

How Keck, should he be approved by the legislature, handles the state’s mounting health care divide greatly worries Otis Rawl, the president of the S.C. Chamber of Commerce.

Rawl said this week that for every $100 million the state doesn’t receive in federal health care dollars, it could result in anywhere from a half-percent to 1-percent increase in pass-through health care costs to the private sector, already struggling to make ends meet in an extremely tough economy.

Fears that Keck may be on a Medicaid hunt may be overblown, according to one Louisiana governmental observer speaking on anonymity, who has been covering “Tony” for years. The source described Keck as a dedicated public health advocate who happened to work in a conservative Republican administration.

“It will work out best for South Carolina if Haley lets Keck do his job and influence her, instead of just making him toe her line.”

With the 2011 legislative session set to begin Tuesday, much of the first week will be spent introducing bills and referring them to various committees. On top of that, Gov.-elect Nikki Haley will be sworn into office Wednesday.

Inaugural events

Gov.-elect Nikki Haley’s inauguration festivities will take place over a two-day period. More:

• Family.  A Family Fun Night is scheduled to be held from 5:30 p.m. to 8 p.m. Tuesday at the State Fairgrounds, Cantey Building, Columbia. Adults are $20 and under 18 are free.
  
  
• Church. A prayer service will be held at 9 a.m. Wednesday at Trinity Episcopal Cathedral. It is open to the public.
  
  
• Ceremony. The official inauguration ceremony will be held at 11 a.m. Wednesday on the south sides steps of the Statehouse, and is open to the public.
  
  
• Open house. The First Family will host an open house 2 p.m. to 4 p.m. Wednesday at the Governor’s Mansion. It is open to the public.
  
  
• Gala. The Inaugural Gala will be held from 7:30 p.m. to 11 p.m. Wednesday at the Colonial Life Arena. Tickets are $250 per couple.
  

In the Senate:

• Rules. The full committee will meet Tuesday at 10 a.m. in 308 Gressette to discuss a handful of bills, including one that would call for more recorded legislative votes.  More.
  
  
• LCI. The full committee will meet Thursday at 9 a.m. in 308 Gressette to begin screening of two of Gov.-elect Nikki Haley’s cabinet heads: Robert Hitt for Secretary of Commerce, and Catherine Templeton for Labor, Licensing and Regulation.  More.

In the House:

• Ways and Means. A series of subcommittees will begin meeting with state agencies to listen to budget requests and provisos:

• Health care will meet Tuesday, and hour and a half after adjournment in 108 Blatt. More.
• Law Enforcement and Criminal Justice will meet Tuesday an hour and a half after adjournment in 521 Blatt, and immediately upon adjournment Wednesday in 305 Blatt. More.
• Higher Education will meet immediately after adjournment Wednesday in 321 Blatt. More.
  

In related meetings:

• DNR. The full board of the Department of Natural Resources will meet Wednesday at 2 p.m. in the Rembert C. Dennis Building, room 335 at 1000 Assembly St., to take in reports from a long list of committees and officials.
  
  
• Nukes. A federal panel will hear testimony today from a variety of sources on what to do with high-level nuclear waste. The panel, which was to start at 11 a.m., is charged, in part, in deciding how the federal government will move forward with the Yucca Mountain nuclear dump facility, which could take on some of the more noxious waste being stored at the Savannah River Site near Aiken.

Gov. Nikki Haley’s announcing this week her desire to create a coalition of the departments of Corrections, Juvenile Justice, and Probation, Pardons and Parole, may have provided a road map of how she intends to trim the state budget without cutting more of the core services of state government.

The House GOP released its 2011 legislative agenda this week with the stated purpose of creating jobs, reforming government and improving the lives of citizens, according to Speaker Bobby Harrell (R-Charleston).

Standard agenda items included tort reform, strengthening charter schools, transparency in various modes, anti-abortion moves and thwarting illegal immigration. The caucus, claiming a “true” mandate from voters, said it would fight for a bill that would allow for a two-thirds vote to repeal a federal law (think: federal health care reform).

S.C. Chamber offers priorities

The loudest voice for business in the state released its own legislative agenda this week. Calling for an end to piecemeal action, the state Chamber of Commerce said it would work for comprehensive tax reform with a special eye trained on education funding. The agenda also called for job development, regulatory relief, health care costs and restructuring state government.  More.

Celebration of greed and unbridled power

While many are celebrating the inauguration of Gov.-elect Nikki Haley, the S.C. Progressive Network will host an “InHOGural Ball”  from 7 p.m. to 9 p.m. at the Big Apple, 1000 Hampton St., Columbia.

Protesting the treatment of the poor and the “rich getting richer,” the ball will feature comedy, music, cake and Kool-Aid. The cost is $10 for those making “under” $200,000 a year and free for those making over that amount.  More.

Milliken passes

Textile magnate Roger Milliken died last week at the age of 95. Milliken was credited with breathing life into the state’s modern Republican Party, and was regarded as a kingmaker within party ranks. A billionaire, Milliken was committed to running his privately-held family business, charity and the environment. Because he died before the end of 2010, his heirs, reportedly, may not have to pay estate tax on what he leaves behind, which at one time topped $1 billion.

Nationally-known Charlotte economist Mark Vitner opened a talk this week to Charleston Rotarians with this: “The near-term prospects for the economy have improved significantly.”

The national economy, the Wells Fargo executive said, has been growing for 18 months, including the last five months in a row. More importantly, the fourth quarter of 2010 will end with 3.5 percent to 4 percent growth – much stronger than many anticipated.

“We’re clearly not going to have a double-dip” recession, he said, adding that inflation remained low and prices for everything, excluding food and energy, likely would rise less than 1 percent in the near future.

Clemson economist C. Bruce Yandle noted in an end-of-the-year report that economic transitions don’t last forever. Employment, he said, was improving. 

“If this recovery follows the slope of the most recent 2004-07 recovery, then we can look forward to seeing the December 2007 level of employment by the second quarter of 2013,” he said. That means our 10+ percent unemployment for the last two years, could drop to a more palatable 6 percent by then.

“It is a slow path, but it is positive,” Yandle wrote. “The pace of the recovery varies significantly across S.C. metro areas, but all areas seem to be generating job recovery.”

Both economists agreed job growth was picking up. In 2010, the country added about 90,000 jobs a month, Vitner said. In this new year, the number should move toward 160,000 a month. But while the recent Great Recession “doesn’t hold a candle” to the Great Depression, most need to understand that the huge job loss suffered by America – particularly in permanent jobs – will take years for the country to recover completely. Vitner said adding back the millions of jobs lost could take another 10 years.

South Carolina has a different economic picture than the nation because of its large rural population and past reliance on labor-intensive industry, Vitner added.  Private-sector employment growth still is weak, but there are modest gains in education, health care, business and professional service sectors. 

The biggest challenge now: Construction jobs, which are flat. “The state’s decline in construction employment sets us apart in a tough area for future recovery,” Yandle wrote.

“In the near term for South Carolina, the good news is businesses appear to be cautiously expanding once again and hiring is picking up,” Vitner said. “And the bad news is most of the growth is taking place in industries that tend to be fairly capital-intensive, which means the number of new jobs being created is relatively small.”

But on a brighter note, as the nation continues to produce and export more, South Carolina’s dulled manufacturing capacity will start to hum again, which should bode well for the state in the next few years, Vitner said.

“In the long term for South Carolina, the good news is that the state remains extremely attractive to manufacturers, distributors and professional service providers,” he said. “And the bad news is that most of this growth is likely to occur in the state’s larger metropolitan areas, which means that many of the state’s smaller metro areas and rural areas will likely continue to languish.”

So what can be done to spark recovery sooner? Three ideas come to mind:

• Invest in educational attainment. Unemployment is higher in areas where South Carolinians have lower educational attainment. By bringing up education and skill levels, the state will be more attractive to employers.
  
  
• Reform S.C.’s tax structure. Systemic reform, as suggested by the Tax Realignment Commission, will smooth how the state gets money, make it more efficient and improve tax fairness. If legislators ignore the TRAC report, the only prescription is more cuts, which will have a downward spiraling impact on the state – and make the recovery longer.
  
  
• Focus on small business. As outlined in our Palmetto Priorities, lawmakers need to make small business development a state priority, instead of political Pablum at election time.

By Jackie B. Hicks
President, South Carolina Education Association

JAN. 7, 2011 -- We know that the General Assembly believes in the importance of quality public education for all of our children. South Carolinians want their children to be productive citizens in a 21^st century economy. And we know that there are competing public service needs—highways, public safety, health care, higher education—that are also hurting during this economic downturn. But it is critical that we not only provide adequate funds for public education in South Carolina but also pay closer attention to equity in how the tax burden is distributed and the how state funds are distributed to school districts. 

We are focusing this year on two important funding issues for education and other public purposes: adequacy and equity. We are seeking ways to make investing in public education more adequate and stable in future years so as to protect the needs and interests of our state’s children in ways that are fiscally responsible. We are also looking for ways to more fairly distribute tax burdens on households and businesses while also distributing education funds more equitably among school districts. 

For that purpose, we have put together a set of four revenue proposals that address both adequacy and equity in funding education. These proposals, if enacted, would offset some of the losses in education funding without burdening our state’s families and businesses with higher tax rates. They would also provide some modest relief for the poorest districts through adjustments in the Education Finance Act.

These proposals are:

• Revise or replace the Index of Taxpaying Ability (ITA).  After Act 388, the ITA was no longer a satisfactory measure of a district’s ability to raise more funds. We are calling for replacing the ITA with a similar formula as now used for fees in lieu of taxes for business and industrial development.
  
  
• Broaden the base of the sales tax.  The Tax Realignment Commission has done some excellent and thoughtful work in this area. One of their recommendations is broader sales tax coverage of personal services. Another is phasing out the sales tax cap on cars, boats and airplanes. Both of these changes would expand the base of the sales tax and also make the sales tax more equitable, because more of the additional tax revenue would come from higher income households.
  
  
• Review and reconsider some of the many tax expenditures in the state’s individual income tax and weigh those revenue losses against the need for additional investments in education funding. Both the state’s own provisions and the frequent changes in the federal tax code deserve careful and regular review in light of their impact on state revenue.
  
  
• Minimize the erosion of the property tax base through tighter control of the farm and forest classification and exercising greater oversight of the conversion of rental property and second homes to 4 percent owner-occupied property. Loss of potential revenue because of abuse in these areas is an ongoing concern. 

These four measures, taken together, are only a stopgap program. There are other revenue issues that can and should be addressed, and other issues related to how state education funding is distributed to school districts that deserve attention. But in the immediate funding crisis situation, we think that these four steps will provide some crucial additional funding not only for public education but also for other budget needs, while also paying close attention to issues of fairness among taxpayers and among school districts.

Jackie B. Hicks is president of the South Carolina Education Association. A mathematics teacher for 30 years, she is on leave from the Clover School District to lead the SCEA. 

Traffic deaths. State traffic fatalities for 2010, while still a discomfiting 770, were at the second-lowest level since 1962.  More.