Transcript: SC Gubernatorial Debate I

The following is a transcript from the first South Carolina gubernatorial debate held at the Francis Marion University Performing Arts Center in Florence, S.C., on Oct. 17, 2018.

CHARLES BIERBAUER: Good evening, and welcome to the 2018 gubernatorial debate live from the Performing Arts Center at Francis Marion University in Florence, South Carolina. I'm Charles Bierbauer. Joining me tonight to question the candidates is Andy Shain of The Post and Courier.

With election day less than three weeks away, this is the first of two debates we will have with the candidates running for South Carolina's top office. They are Henry McMaster, the Republican candidate, and James Smith, the Democratic candidate. Before we begin, gentlemen, these ground rules:

Each of you will have the opportunity for a one-minute opening statement. After that, we'll have one minute to answer our questions. And if necessary, I'll allow 30 second rebuttals. We drew places when the candidates arrived and we'll start with Governor McMaster's opening statement.

HENRY MCMASTER: Thank you. And thank you for having us here. And thank all of you for coming. And thank you who are watching at home. I am enormously proud to be the governor of South Carolina. Everywhere I go, I'm proud to be representing you.

And this city is a perfect example. We're in Florence right now. Not long ago, we had a tragic death. A man, Sergeant Terrence Carraway, gave his life for us. There were others willing to do the same. That is the kind of people we have in South Carolina--strong, determined.

And we have a great team. I am a member--a part of a great team in South Carolina to get things done for the people of this state. And I have a record of doing it. And that team goes all the way to Washington.

So this is what we're gonna do. Since I've been in office I've announced 23,000 new jobs, $8 billion in new investment, and we're just getting started. More people working than ever before, and the next four years, are gonna be even better. We're gonna win, win win. Thank you.

CHARLES BIERBAUER: Thank you, governor. Representative Smith.

JAMES SMITH: Thank you. Thank you, Charles. And Henry, if this is winning, I would hate to see what losing looks like to you.


Charles, I want to thank everybody who's helped put this on together. My fellow South Carolinians, elections are about our future. And my name is James Smith.

And I believe in a South Carolina where every child has access to high quality education, where they're prepared for the jobs that are here today and tomorrow, where we all have access to affordable high quality health care, and where South Carolina is at the top of the list now to live, work, raise a family, and build a business.

When I served and led American soldiers in combat, I cared more about their future and their very lives than my own. And we need a governor who cares more about our future than the next primary election. I know this. I ask for your prayers for my family. I ask for your support. And I know as governor, our best days are ahead of us. Thank you.

- Thank you, both.


Let me start the questioning here. And we value your enthusiasm, but it can erode time away from your candidate. Our role is to elicit substantive answers, more than political cliches, that will help the people of South Carolina decide which of you is the better choice for the next four years.

With that in mind, it's been several months since we had our last round of debates. And they have not been calm months. Hurricanes Florence and Michael have left their mark on South Carolina, in some areas, severe and deadly marks.

You were both appropriately involved, you as governor, you as a member of the National Guard. And these are certainly not the last hurricanes or floods we will see. So tell me, if you will, what did you learn? And as governor, what would your priorities be to prepare for and cope with future situations? Mr. Smith, we'll start with you.

JAMES SMITH: Well, Charles, we, of course, continue to think about those that were directly affected by the storms and the recovery still goes on. And as governor, I'll be there with those that are fighting to recover, not do as Henry did when he vetoed desperately needed flood relief. And it had to be upon the Republicans and Democrats to come together to override his veto of that desperately needed flood relief.

I will be there as governor, before the storm and after the storm. I've been there as a national guardsman for two decades, facing the natural disasters that have faced our state, one cog in a very big wheel, part of a great team, making sure that South Carolina is prepared. But we have to do a better job, principally, in making sure we invest in our infrastructure.

And so, unlike Henry, I'm gonna sign the bills that are gonna improve our infrastructure. I'm gonna move our state forward and make the investments that are gonna prepare us for the storms of the future. And I'll be there to make sure that we have the resources to recover, and that we work with local communities to make sure the infrastructure is there. So they can get back on their feet.

- Governor McMaster.

- Well, we're gonna have more storms. We're gonna have more flooding. And we have to plan for the future. In recent years, it's become clear. We have to do that. That's why earlier this week, after consideration for a number of months and talking to a number of experts in the area, I issued an executive order creating for the first time a commission on flooding.

And it will address flooding along our coast. It'll address flooding in the rivers. And we're gonna bring the best minds, the best ideas from infrastructure construction, to preventive measures we can take, to such things as seawalls, and everything in between, to see to it that our people and their property are safe and secure.

But back to the flood, the most recent one, we got plaudits from all over the country. We had the best team in the United States, according to people who've come here and have worked with us in putting pieces back together in preparing for these floods and these disasters. And we had the full support of the White House and the administration in getting the help we need to our people. And I assure you, we're gonna get it.

CHARLES BIERBAUER: Thank you. I'm glad you mentioned infrastructure because it's a concern. Seems even as we're struggling to get our roads and bridges back in shape, nature may be winning the battle at times. Let me ask you, and starting with you this time, governor, what does the increasing severity of these storms say to you about global warming? And why do we even permit or even facilitate rebuilding in such flood-blown areas?

HENRY MCMASTER: Well, we-- is this my question?

CHARLES BIERBAUER: You start first, sir.

- Well, we have a state law. [CLEARS THROAT] And I signed a part of that just recently to see that the setback lines and such along our coast are given the right time to have them sit in the right place. They've been set in the wrong place.

We started to retreat from the beach. We have to be very careful that we're not building in those areas. And that's one reason we need a plan. That's the reason that I've started this group that will understand all the options, what's been done in other parts of the world as well as other parts in the United States.

But as far as infrastructure goes, we have great needs in South Carolina. And we have great needs, for example, in 526. 526 is a highway that must be built in order to facilitate the exit and evacuation of those places.

We need the same thing in I-73. I've taken steps recently to see that both of those are getting done. I know how to do it. I've had a record to do it, and we'll get it done.

CHARLES BIERBAUER: Representative Smith, same question.

- Thank you. Thank you, Charles. This is another one of those occasions where, you know, Henry, you have to care more about doing the job than keeping the job. And when it came time to sign the bill that was passed by a vast majority of Republicans and Democrats in the House and in the Senate to pave a better future for us, to improve our roads, and improve our bridges, and prepare us for future storms that are directly related to climate change. We got it done.

We worked together, Republicans and Democrats, and it was you, sir, Henry, who vetoed the bill, and then begged us to override it before the ink had time to dry. That is not the profile in courage that we need in South Carolina. We need to make sure we've got governors working for us and serving the people of South Carolina. And that's what I'll do.

I'll care more about their future than my own political future. And we need that kind of leadership in South Carolina. I know this. We're gonna see future greater storms. And they are coming. And the experience that I've had, being a part of the South Carolina team, and working our all hazards plan, has made me prepared to make the right decisions in the future, and when to institute a evacuation.

CHARLES BIERBAUER: Thank you. Andy Shain has the next round of questioning starting with Representative Smith.

- All right.


- "The Post and Courier" asked each of you last week about how you would change the tax code here in South Carolina. You both spoke about wanting comprehensive tax change, but really didn't say a lot in the way of specifics or details.

What changes would you promote if you stay as governor, if you're elected governor? And if you're backing cuts, how do you keep the current level of services in the state because-- with less money coming into state coffers. Representative Smith.

JAMES SMITH: Thank you very much, Andy. Having a 20-year record of supporting pro-growth tax initiatives that have made a difference all across our state, I'll continue to lead with Republicans and Democrats to institute those types of tax amendments that make us more competitive and improve the business environment in our state.

And I'll certainly oppose whatever president that might institute job-killing tariffs because they're essentially a tax on the people of our state. But going forward, what I'm gonna do is I'm gonna institute the same type of initiative for affordable housing in our community across the state 'cause we desperately need more affordable housing.

And you can point to what's happened here in Florence with the Abandoned Buildings Revitalization Act, something that I authored with Republicans and Democrats and was reauthorized, but Henry decided to veto. You can walk down the main streets here in Florence, and you see many buildings that were revitalized that would not have been revitalized without that pro-growth initiative. So in terms of a comprehensive effort, I'm gonna make sure that that's a key component of that.

ANDY SHAIN: Governor McMaster.

- The answer [CLEARS THROAT] to economic growth and prosperity is low taxes and lower taxes. Mr. Smith.


And we've learned that with President Kennedy, with President Reagan, and now with President Trump. I've looked through Mr. Smith's record and that of people on his team, and it's always raising taxes on the people of South Carolina. Mr. Smith, I haven't found a single tax that you voted against. It seems that that side of the aisle will always seize the answer in raising taxes. I'm in favor of cutting taxes.

ANDY SHAIN: But how do we keep the state services, then, at the level that they're at now, if we're cutting taxes.

HENRY MCMASTER: I'll answer that. What you do is you cut--you reduce the burden. You reduce the burden of taxes, and reduce the burden of regulations on the people, and what happens? More jobs are created. People spend money. And you end up actually getting more money in, although the tax rates are lower.

It's been proven. Every time it's worked. That's what I'm for. That's what I'm doing. I've got a record of doing that. And my opponent is just the opposite. His team, all the way to Washington, are just the opposite.

CHARLES BIERBAUER: Henry. Do you want a rebuttal, sir?



Henry. Henry, there you go again, misleading, essentially dishonest--

HENRY MCMASTER: Wait a minute. That's a Ronald Reagan line.

- That's exactly right.

HENRY MCMASTER: You can't use that.

- And it's mine now. It's mine tonight. It is my line tonight because, Henry, I think you'll do it a lot. But the fact is this, as governor, there's zero power of the governor by themselves to raise a single tax.

And the reality of my record is we have a constitutional amendment for a balanced budget. And I've worked with Republicans and Democrats to make sure that we've had fiscal accountability. And we've done that as best we can every year successfully. And so I think the people of the state can count on me to make sure we are fiscally responsible.



CHARLES BIERBAUER: Governor, you can have 30 seconds if you want.

- You keep spending money. And you have to tax the people more and more to make up for that spending. You're going in the wrong direction. History and economics prove, you reduce taxes, reduce regulations, that is what cause economic prosperity. And that's what I'm gonna do.


CHARLES BIERBAUER: Andy Shain's next question will start with Governor McMaster.

- In the same questionnaire that you received from The Post and Courier, you'll mention--both of you mentioned, eliminating some of the state's tax exemptions, sales tax exemptions, didn't specify any of them. Obviously, again, in office, which ones would you try to promote, of the hundreds of sales tax exemptions we have, that we need to eliminate?

HENRY MCMASTER: Well, if they're any that are just plain wrong, and don't make sense, that's one thing. But eliminating an exemption is the same thing as raising a tax. I want to lower taxes. I want to lower crack taxes across the board. I've asked for a 15% income tax reduction. I don't expect Mr. Smith to vote for it, but I expect a lot of others.

I've asked for no income tax at all on retired men and women in uniform, military uniform, law enforcement, first responders. What happens when you eliminate those taxes, when you reduce those taxes, people have more money. You can raise pay, or you can eliminate taxes they pay on that pay. Either way they have more money.

They're able to invest it, to take care of their families, and that's the way to prosperity. There is no way for the people of this state to enjoy economic progress and prosperity if we do not encourage the growth of business in South Carolina. If you want to raise taxes, and more regulations, and big government, say, well, stop coming here.

ANDY SHAIN: So, Governor, what you're saying is you don't want to limit any of the sales tax exemptions that are currently in existence.

HENRY MCMASTER: Unless you can show me one that by--if we can get rid of it and lower taxes on it. I don't know how you do that. When you eliminate an exemption, you're lowering taxes. I'm in favor of--your raising tax. I want to have comprehensive tax reform. But I want them to go lower, not up.

ANDY SHAIN: Thank you, Governor. Representative Smith.

- Andy, the reality is this, Henry, the fact is in South Carolina, since you've been governor, our wages have not moved anywhere. Yet above--just above us, in North Carolina, they have increased their wages by twice the amount.

The reality also is that South Carolina now is 33rd in terms of the best places to do business, when North Carolina and Georgia are eighth and ninth. Our labor participation rates, Henry, have actually gotten so bad, they've doubled in your time in office, that we actually have fewer people working than we had when you entered the office.

And your plan to do this and, apparently, to essentially was gonna-- you know, whether, it's our Department of Commerce, or our Department of Corrections, or just about any agency that we need to make sure that the resources are there for the people of our state, they're not gonna be there. And it's not gonna allow the prosperity that I know can be there for our state and our future.

ANDY SHAIN: And again, Representative Smith, real quick, same question. Are there any exemptions that you really think should be--

JAMES SMITH: I think there are some exemptions. But I think you have to look at it. They're arbitrary and capricious. And I think we need a legal test as to whether or not they should be supported entirely.

HENRY MCMASTER: I have rebuttal. Everybody is entitled to their own opinion, but not their own facts. Right now, we've got more people working in South Carolina than we've ever had before. Our unemployment rate is the lowest it's been in 50 years.

Everybody doesn't get a chance to talk to people like I do. I see some in the audience. I see Senator Leatherman. I see others that have talked to people. People is--is that Senator Williams there? People--they're lining up. Businesses are lining up from around the world to come to South Carolina.

Georgia and North Carolina are looking at us trying to figure out what we're doing, so they can get ahead of us. And we're not gonna let them do it. And the way we do it is we keep the open for business sign up with low taxes and low regulations.


- Thank you.

JAMES SMITH: The fact is this--

- I wanna--I wanna move on because we can go back and forth on tax after tax after tax here. A question that relates to the earlier issue about the hurricanes, but more broadly, Governor McMaster, you asked for federal aid during Florence expeditiously, quickly. But in a different context, the question that arises in my mind is when we want aid from Washington and when we don't.

And the question's gonna start with you, Representative Smith. But in effect, the one that is most striking is Medicaid expansion, which you have turned back as did your predecessor Governor Haley. So the question that I want to hear from you both is when is the right time to ask for federal aid, and when is it time to turn it down? What are the priorities? How do you weigh those pros and cons? Representative Smith.

JAMES SMITH: Charles, quite simply, when it is in the best interests of the people of South Carolina. I will always care about their future more than my own. And clearly, Henry, you've been more concerned about your political future 'cause you've refused their--our money, Henry. You could do this any day you wanted and deliver $2 billion without raising a cent in taxes.

And I know this. I know this, my friend. This is why we gotta put the people of our state before politics and ideology, and serve the people of our state. Right now, I know it would deliver 40,000 jobs, an entire medical economy. It would actually save money 'cause we would support preventative care and make sure we had healthier outcomes.

Right now, in your--as you were governor, South Carolina has the worst health care outcomes, but we pay the most for it. That will not change if Henry continues to serve. It will change if I have the extraordinary privilege to serve as governor of our state. And we'll take ourselves forward and make for a healthier South Carolina.


- Governor McMaster, what's the balance? How do you weigh the pros and cons?

- We accept federal aid when we need it, when it's good for the people, and when it does not come with strings attached to it, and regulations that will suffocate economic growth in South Carolina. And that's precisely what Obamacare, which is what Mr. Smith is talking about, would do.


What he does not mention is--[LAUGHS] what he does not mention is this--our payment, our part of that, after the first few years is a billion dollars a year.

JAMES SMITH: That's not true.

AUDIENCE: That's not true.

- Our part--

CHARLES BIERBAUER: Please let the gentleman respond.

- That's OK. Everybody's excited.

CHARLES BIERBAUER: No, they can run for office when it's their turn.

- That's good. If you got a good answer, send it to me.

- Go ahead, please, governor.

- The Obamacare comes, the first year when we have to start paying the money, it's a billion dollars. Now, our part of state taxes, our part of our budget, which is $26 billion counting federal money that comes in, is about $10 billion or $9 billion something. Where are we gonna get a billion dollars to pay? And what do the strings that come with that do to private business and industry? Here's the answer to that.

I removed a regulation that allows nurse practitioners to go anywhere under the state, any number of them, under the supervision of a physician, anywhere in the state, taking the nurse practitioners out to the rural people, to the rural areas, to the drugstores, to the grocery stores, the clinics, those kind of things. That kind of expansion in telemedicine, that is the answer. It's free enterprise. And it doesn't cost you any tax money.

CHARLES BIERBAUER: Thank you, governor.

JAMES SMITH: The fact is this.

- I'll come to you. Let me follow up, governor, because I want to make sure the numbers are right. My understanding was that the cost to South Carolina, had Medicaid expansion been accepted, would have been in the neighborhood of $600 million over a span of, I believe, seven years.

HENRY MCMASTER: That's not right.

- And that the returns would be $11.2 billion. So if that's not right, what are the numbers?

- It goes up for a number of years. And then it levels off. But in addition to the cost--

JAMES SMITH: It's it a billion dollars though, governor.

- Is it not always--

JAMES SMITH: You can't have your own facts here.

- Is not always a 90:10?

- Is it what?

- Does it not always remain a $1 from South Carolina for $9 from Washington?

- That's correct.

- Is that not the right proportion?

- That's correct. That's correct.

- So is there a risk that you see of being too dependent on the federal government?

HENRY MCMASTER: I see us having to pay that part of it as money which we don't have, which money we'll have to take from schools, money we'll have to take from roads, money we'll have to take from law enforcement. That's a lot of money for us to be paying for a system that is not going to work.

And under Obamacare, the insurance premiums are already more than they were before we started. And in addition to that, they're putting a stranglehold on businesses, on insurance companies, and on everybody else. We don't need that. There's a better way.

And the better way is with free enterprise, with what I mentioned. Unleash the nurses, unleash the nurse practitioners, use telemedicine, get the doctors, you don't bring the--make the person go to the hospital. You take the hospital, you take the health care to them. It's individualization. That will work. It won't cost us any money.


- Henry.

- Is there a risk of becoming too dependent?

- No, not with my plan, and the way to serve South Carolina. Henry, you're wrong on the facts. And you're wrong for South Carolina. The fact is this. When we accept the Medicaid funds, I know in the first three years there'll be zero revenue.

Senators, House members, my colleagues, I won't have to ask you for a penny within the first three years. And what we're gonna do is prepare for the future. And at most, it'll be 7% to 10% by the time we get 10 years from now. It is the most fiscally responsible thing to do. It delivers on an entire health care economy, 40,000 jobs.

And you know what? We are not getting healthier under your pursuit right now, under the state you would have. We simply, right now, have--right now, we have infant mortality and morbidity rates that equate to that of developing countries.

Henry, I'm gonna do something about it when I'm elected governor. I'm gonna serve the people and make sure we improve health care outcomes. And when we do that, you know, we save tax dollars. And we have a more prosperous state because we responsibly use that resource for the people of South Carolina.

CHARLES BIERBAUER: Thank you, Andy Shain has the next round of questions. And Andy's question will start with Representative Smith.

- In recent years, South Carolina has had a spate of gun violence. We had the Charleston church massacre. We had a first-grader who was shot and killed on a playground in the upstate. And most recently here in Florence, we had seven police officers who were shot in a gunfight.

What needs to change to curb the gun violence that we're seeing in the nation, most importantly here in South Carolina, but obviously it's a nationwide issue.

JAMES SMITH: Well, first, we remember Officer Carraway and all of the six that were wounded that terrible day, and the risks they take every day, in standing for us, that there's something around the corner or in the car. They risk their lives every day. And they deserve our support and their families. And I will be there for them, just as I was there for my soldiers in Afghanistan.

But we can do more. I know we can do more to keep guns out of the hands of those that shouldn't have them. And my position is in full agreement and in support with law enforcement and military professionals. The fact is, Henry supports allowing individuals to carry AR-15s openly down the streets in Florence.

He thinks that we ought to have this constitutional carry, which I think is inconsistent with the communities that we want to have. I've been in places where everybody is armed to the teeth. And I promise you, you don't feel safer. Also, we're gonna work to close the Charleston loophole and work with my colleagues to make sure we make improvements there. And I know that there is bipartisan support for that. And as governor, I look forward to signing that bill.



ANDY SHAIN: Governor McMaster.

HENRY MCMASTER: Well, the Charleston loophole is actually not a loophole but is a failure of technology. Right now, there are all sorts of qualifications one must meet in order to be cleared to buy a gun to begin with. And they are ample and they are strong. The problem is, as tragically happened in Charleston, is the system did not work fast enough.

There's a three day period. If the system does not say yes or no within three days, then the answer is yes. We have the technology to see that we have ample information into that system that can produce an answer immediately that will keep those, as it would have this young man, from being able to purchase a firearm in the first place.

But you have to always get back to the Second Amendment. The Second Amendment is in the Constitution for a reason. The recent case up in D.C., the Heller case, I believe, just a few years ago, said that, of course, that extends to you in your home. It extends to people, not just militia.

When you start intruding on the Second Amendment, that is when we get into deep trouble. It's happening to other countries. We don't want it to happen here. We have to be smart, but we don't want to be careless.

ANDY SHAIN: Governor, let me be clear. How do we curb this? What could help end what this cycle is becoming?

HENRY MCMASTER: Well, what I just described would be one thing. But the answer to these kind of things is an alert citizenry and good law enforcement. We've got the best law enforcement in South Carolina of any place in the whole country. If we train them, if we educate them, if we give them the machinery, give them the tools that they need to do their job, they can make the place a lot safer than it is now.

Everybody ought to be their neighbor's keeper to an extent. And when you see something, say something. There a lot of things you just can't solve with yet another law. There are a lot of things that the average citizen, all of us, must do to help keep our place safe and help keep your children safe.


ANDY SHAIN: And let me-- again, same question to you, Representative Smith. Specifically, what is it we need to do to curb this? What laws do we need to enact? What rules, regulations?

- Sure, I mean, I did mention, you know, supporting, which I have, the Charleston loophole. And we've made some significant progress. And I agree with the governor. We need to be there for law enforcement. I believe we do have the very best in the world. And they deserve the best in terms of training and resources.

I also want to do more to improve the security in our schools. And I know and I believe, we can have a school resource officer in every school by 2020. And we're already doing it. We're working with Republicans and Democrats in the House and Senate. And we're getting it done. And it will happen.

I also want to make sure that there's a hotline for every student that they can reach out. If they see something, they can say something without fear of peer pressure. And I'll put those things in place as governor.

ANDY SHAIN: Well, let me ask a very quick follow-up. 130 guns were found in the home of the shooter here in Florence. 130 guns. Is that appropriate? Should that be allowed, for someone to have that many guns in their home?

JAMES SMITH: As long as he is a law abiding citizen and has--sure, I mean, I don't think there's any ability to restrict that under current laws or under the Constitution. But, I mean, obviously, what happened here is a horrific tragedy. And I don't know if there was indications ahead of time that would have allowed a prevention of that.

But it points out, the type of risk that our law enforcement take every day, just simply delivering a subpoena and a search warrant. They're at risk for such an event every day.

ANDY SHAIN: And to you, governor.

HENRY MCMASTER: There are a lot of avid hunters in our state and around the country that probably have that many firearms in the house. And they never have hurt a soul and never will. That's why we need to be careful. And that was a tragic situation, of course.

But yes, we--I, in my State of the State address, asked for a certified, trained, armed law enforcement officer in every school in every district in every county in South Carolina. And the legislature, I asked for $5 million. They gave me $2 million.

I'm gonna keep pushing until we be sure that we have them everywhere. That is one thing that I have done to make that true in South Carolina to keep our children safe. And I'm gonna keep doing it to keep those children safe.


- Gentlemen, let's stay in the schools for a little bit longer here. Education, you both referred to the resource officers. There's an apparent budget surplus for this fiscal year in the neighborhood of $177 million, is the number that sticks in my mind. Teachers are asking for a substantial part of that. Other state employees, I suspect, would like some of it too.

Do they deserve it? You're probably in trouble if you say, no. But if so, what portion, by what criteria, do you address the need for more funding for teachers, starting with you, Representative Smith?

- Well, it's just a fact. We have a teacher crisis in South Carolina. And the number one job of a governor is to make sure all our children have access to a high quality education.


And that's why I, as governor, am gonna make sure that we raise teacher salaries above the southeastern average. And I can do that, Henry, without a tax increase. There will be no tax increase to do that.

I'm gonna lower class sizes and deliver the high quality education that our kids deserve. All I've ever heard you say is you want to arm our teachers with weapons. I don't think that's gonna teach a child in our state how to--for their future.

CHARLES BIERBAUER: How do you do it without a tax increase?

JAMES SMITH: Well, you can do it. We were doing it when Jim Hodges was governor. We did it in the first four years of my first term. I will get there. It's about setting priorities. And we've been doing it in the past. And we would have had it done and continue that way, if the commitment remained to focus on the number one duty of our state, which is to educate our people. And that's what I'll do as governor.

CHARLES BIERBAUER: Governor McMaster, what about the teachers? Is that a priority? Or have you got other plans for that $177 million?

HENRY MCMASTER: Well, my plan is not, every time we get a surplus, to hurry up and find some place to spend it. That's for sure, unlike Mr. Smith. And I do not believe that raising taxes is the answer. It never is the answer. It's short-sighted. It ends up killing the economy, killing economic growth.

And economic growth, and prosperity, and strong families, and households that stick together, and where the people, where the breadwinner or breadwinners that get up in the morning, they got a job, and they want to go to work--that kind of economic growth and prosperity is the cornerstone of good education, good family, strong children, and everything else.

But I know from-- I've been to the so-called Corridor of Shame. I'll give you this one example. In one county, a rural county, no manufacturing at all, no big industry at all, talking to the superintendent, and I asked, what would happen if one factory came in? One good, clean plant, and it would hire maybe 300 to 500 people. What would happen?

And she took off her glasses. She's a PhD. Took off her glasses, [INAUDIBLE], put down the pencil, and said, that would change everything. Teachers would come, and teachers would stay. The children wouldn't leave. We'd have jobs. We'd have economic growth. That is the answer. That's the long-term answer to education.

And we have to help. We have to push. We have to supplement as much as we can. Got to get those unnecessary tests off the teacher, smaller classes, consolidation.


- There are a lot of answers--things we can do that do not cost money.

CHARLES BIERBAUER: Thank you, sir.


JAMES SMITH: This is very, very important. You know, we have a massive teaching crisis. Right now, nationwide, there's a report that came out that said South Carolina is the worst place in the country to be a teacher. And if it's that bad to be a teacher, it can't be good to be a student. And what I've heard, Henry, you say, that is you're gonna do nothing. That nothing will change--

HENRY MCMASTER: You've not been listening.

JAMES SMITH: --when you're elected.


You're not gonna make a difference.


JAMES SMITH: And the fact is is that plant is not gonna come to that county if it doesn't have the infrastructure. It's not gonna come to that county if it doesn't have the educated workforce to fill those jobs. And that's the biggest problem facing our state. And you said, you're gonna do nothing about it.

CHARLES BIERBAUER: Governor, you may respond.

HENRY MCMASTER: Well, of course, that's about 50% nonsense there. I didn't say that at all.

- Well, it's 50% sense then.

- I've given you the answer. The rest was inaccurate. Listen, the answer, we have to have--yeah, we do have a teacher crisis. We have a number of crises. We've got a infrastructure crisis. We got a lot of crises. But raising taxes is not the answer to everything that comes up.

JAMES SMITH: Who said raising taxes is the plan.

- James.

JAMES SMITH: I have not--

- Listen, I got a list in my pocket of all the taxes that you've--everything that comes along the way.

- And you know what? I have zero power as governor to raise the tax. That comes from the General Assembly. Don't you understand that, governor?

- Let me tell you this.

- I can't do that.

- If we were to have--all right, I got 10 seconds. If we were to have a governor that is known around this country to the manufacturers and the business leaders, that has had a record of raising taxes all the time while he was in the legislature, they would go to North Carolina or Georgia. And that's why we don't need any tax raising in the governor's office.

CHARLES BIERBAUER: Let me ask you another question out of the education area. State Superintendent of Education, currently Molly Spearman is running for re-election. But voters are going to be asked the ballot question, whether the position of Superintendent of Education should be elected or appointed by the governor.

I know you differ on this. I'm gonna start with you, Governor McMaster. Which is the stronger hand for education, which has the greater accountability, an elected or an appointed superintendent?

HENRY MCMASTER: Well, that's the wrong question. The question is what would have--

CHARLES BIERBAUER: That was my question.

- I'll help you with this, Charles.

- Go ahead.

- I don't think you can get your own questions either.

- The answer is a governor who is responsible for it all, who works with a good Secretary of Education. That is the answer because people look at the Secretary of Education, now, the Superintendent of Education in our state, and they see that that is--that's not the governor.

It does not have--that office does not have the power, the power of persuasion, among other things, which is very strong. Having the governor responsible, having one person who is elected by all the people, who are always interested in the governor's race, that would give the governor and the Office of the Superintendent enormous power to get things done. And it'd also ensure that they're going in the same direction, which under me, would be--

CHARLES BIERBAUER: Are you not going in the same direction now?

HENRY MCMASTER: Well, yes, we are, but--but not fast enough. And if the governor and the superintendent--if the superintendent is appointed by the governor, like the lieutenant governor--and there's Pamela Evette right there, who's gonna be the best lieutenant governor in the whole world--that gives both of those offices more credibility and more power.

CHARLES BIERBAUER: Representative Smith.

JAMES SMITH: A superintendent of education is a critically important office in our state. But what's critical about that is the experience that has to be in the office. And right now, as the law as it stands, somebody could be appointed by a governor, if this does become law, that has had zero experience in public education, that has never set foot on a public school. That somebody could be--hold that position.

So I don't support that. I think if you want to lead our schools, you have to have the experience needed to do that. I do not want to see a Betsy DeVos in South Carolina running our schools.


And I know this. It is the number one job of a governor to make sure our kids have a high quality education. It's what I focused on in this campaign. And it's what I'll do during transition. And it will be my priority as governor because our kids deserve no less. And the fact is, Governor, you're failing them. You're not being there for them and delivering them the education that they deserve. And you've offered no plans for that. And you'll have no plans in the future.

CHARLES BIERBAUER: I want to move on. Andy Shain has the next round of questions. And the question will start with Representative Smith.

- Well, let's stay on the education theme. And of course, we're here at Francis Marion University. So let's talk about colleges. South Carolina has the Southeast's highest average public college tuition.

The tuition at the University of South Carolina alone--it's the state's flagship college--has risen 43% in the past decade alone. As governor, what would you propose? What would you push to help stem this rising tuition?

JAMES SMITH: Andy, thank you. We have to have higher education accessible to all of our people in the state. And because of the high cost of tuition, it is becoming inaccessible. And I have plans to change it. However, Henry, Henry, you've vetoed $7 million dollars for Francis Marion University--the very place we are here tonight--so that they could expand health sciences and improve their honors college and education.

It is precisely by failing to invest in higher education that has caused tuition to rise so precipitously. I support the bipartisan effort at a tuition freeze that makes sure we ensure performance. And we support our schools, so we make sure that they have affordable tuition rates. So that all of our kids can access that because we know it's important to a brighter future for the people of our state. And I'll provide that leadership as governor.


- Governor McMaster.

HENRY MCMASTER: Yes, I did veto that. Taking the other funds out of the budget is an exercise in unaccountability, secrecy, backroom dealing, and all kind of mischief. I'm opposed to it.

Every dollar that's being spent by the schools needs to come in, needs to be understood by the legislature, the governor, and everyone, and needs to be budgeted, and authorized for those schools to spend. That would take over $3 billion, almost $4 billion, and have it going secretly unwatched, unmonitored. And it's a bad idea.

The way that we need to get back with a thriving economy. We can go back to the days when we supported higher education much more than we do now. That is the best way to do that. But also, we have to understand something new that's come about in the last 30 or so years.

And that is, there's a whole new world of employment out there that can be accessed, and reached, and be happily exercised through the technical college system in South Carolina, in collaboration with the four-year schools and the research universities.

ANDY SHAIN: But how does that affect tuition? Again, the tuition at Clemson, here--

HENRY MCMASTER: That's real easy.

- --at USC. How do we stem what's going on, please?

HENRY MCMASTER: If somebody wants to go to the technical college and get an associate degree, which now you can get a baccalaureate degree--we've instituted a new plan--it costs much less to go at all. But what we have to do, we have to tell the colleges, they have to hold it down.

There have been instances where legislators have said you can't raise--if you raise your tuition, then there are gonna be consequences. I believe in that. I think they have to hold it down. But one way to help them hold that down is for the state through its growth and economic prosperity to give more than 5% or 6% or 7% of the budget to the colleges. We need to go back up.

JAMES SMITH: Andy, I just, I need to respond to this.


- You know, I am just very grateful and glad for this institution at Francis Marion University, that virtually every member of the General Assembly, Republican and Democrat, disagreed with you, and decided to fund this institution, and give them the resources that they deserve.


ANDY SHAIN: OK, both of you have mentioned--Both of you mentioned, of course, trying to get the legislature to give more money to support schools. For those who don't know, after the recession, the amount, the percentage, that public colleges received in money from the legislature dropped, and really hasn't been restored to those prerecession levels.

The Senate finance chairman is sitting here in the front row. You're the governor, obviously, you're the governor in 2019, what do you say to him? How do you convince him to have the legislature give more money to public colleges?

HENRY MCMASTER: Hey Hugh, let's give them more money.


- Well, it hasn't worked so far. You've been in the job two years. So what else?

- The way we do that is we demonstrate that by lowering taxes, by eliminating inefficiencies, by fixing the roads, by doing all the things that we need, good law enforcement--we have businesses that are moving in. Businesses here are expanding. People are working. They're paying more tax money into the system, but even though it's at a lower rate.

Then we will have plenty of money to do these kinds of things. And that's the day I'm looking forward to. Now, we're gonna have to work to get there. But I'll tell you, Andy, they're lining up. The companies from all over the world, contrary to what Mr. Smith said, lining up to come to South Carolina. It's getting here real fast. And it's a great situation to be in.

ANDY SHAIN: Representative Smith, you've been in the legislature for two decades. You have, you know, obviously, had the opportunity to try to convince, you know, your colleagues to fund more for colleges. As governor, how would you get them to do that?

JAMES SMITH: Well, and I do have experience in bringing Republicans and Democrats together and actually passing legislation, and have the experience to do that. But I've also never been in charge and running things. I've always had to cobble together support to do that. And that's been important experience for me to have, and will be great experience for me to have as governor.

I've certainly worked with my colleagues that are here tonight, Mr. Chairman and many others, on making sure how we fix these things and focus on the things that are most important. And we're already doing that together. We've worked on this tuition freeze initiative, which I know is gonna make a difference.

And we're gonna focus on performance-based funding for our schools, so that we make sure that we set our kids up for success, so that they don't get out of college with a massive amount of debt and no economic opportunities. Because, Henry, the deal is this, you got to deliver on workforce education. And you're not doing it now.

The fact is, the number one decision for industries to come here is, do we have an available workforce that is prepared for the jobs? And we know and you know, that's the greatest challenge. And you've offered nothing to change that.

What I'm gonna do is provide the alignment of our education system that's gonna make sure that our kids know, in the classroom, from their educational opportunities, what the economic opportunities are when they get out. And we're not gonna wait till college or tech school. We're gonna start in K through 12 and deliver that kind of project-based learning that's gonna make a difference and move South Carolina forward.


HENRY MCMASTER: Oop, oop, oop, oop.

CHARLES BIERBAUER: Can you be quick?

- Well, you're too late. We're already doing that. Wilbur Ross, the U.S. Secretary of Commerce, has said, South Carolina has the best workforce development system in the United States. We're already collaborating among the four-year schools, the technical colleges, even to the point of getting a baccalaureate degree from a technical college. That's Dr. Miller up in Greenville Tech did that.

Our technical colleges are wonderful. We're already--all these programs of collaboration with the high schools, and the four-year schools, and on down, we're already doing that. Money's been provided, at my request, has been provided to do that. So we're doing that. But what we need to do is do more of it.

And we need the whole population to understand that there's a new world of opportunity through these technical colleges and workforce. Young people can go, and they do the things they want to do. They work with their hands and their brains. And if they want to go online and get a four-year degree or get another degree, they can do that here better than anywhere.

We're in better shape than the rest of the country on this. My job is to see, as I've been doing, that the businesses that come in know that. And that they collaborate with these schools in order to accomplish it.

CHARLES BIERBAUER: Thank you, gentlemen. I want to change the subject.


In the newly released grand jury report investigating corruption in state government, both of your names come up. I don't know if there's anything you want to tell us tonight, but let me narrow the question. You both dealt with the Quinns, father Richard, son Rick, as consultants or lobbyists.

Did they mislead you? Were you naive? Did you turn a blind eye? Was this business as usual? Tell us more about that relationship, starting with you, Mr. Smith. And there are--in reading that, there are times when you sound defensive about Rick Quinn.

- No, not at all. And I'll tell you, Charles, that this is--my name is mentioned three times, quite in passing. One, I'm quite proud of. There was an SCNG official who acts quite childish in insulting me in the record. And he says--calls me a name. I guess because I've worked so hard to protect ratepayers in our state, he's not happy with me. And I'm not gonna be his governor in the future.

The other time was an incidental mention about appearing or coming to a party or some sort of gathering of which I never received the invite and never attended. But the fact is this, you know, former Representative Quinn and I have worked on a number of issues, including the Abandoned Buildings Revitalization Act of which, Henry, you vetoed.

But the fact is, when we worked together, we've done some good things together. At the same time, I'm not responsible for their conduct. But I've enjoyed the friendship, and the relationship, and the working relationship that we have had.

CHARLES BIERBAUER: If you were governor, what would your priority be in addressing corruption.

JAMES SMITH: Well, I think it's critically important. And ethics ought to be on the agenda every year. The fact is we can always make our institutions stronger, more transparent, and more accountable. And I think clear, after this, we need to look at things like improving the definition of what it means to lobby.

We need to make sure we need to get at dark money in our politics. So we know who's trying to influence our vote and voters. And we need to make sure that those that are trying to influence local government, that they have the same requirements because we know how much money they're spending. They need to follow under some of the similar and same ethics rules and lobbying rules that apply to state government.

CHARLES BIERBAUER: Governor McMaster, same question to you, and your name coming up as well. At any point in this relationship were you misled? Were you naive? Did you turn a blind eye? Did you treat it as business as usual?

HENRY MCMASTER: No, I was never misled. I was never asked to do anything untoward by any of those people. They were consultants for me in my political campaigns, and that was it. And I was mentioned one time as having attended a press conference with former Democrat Attorney General Travis Medlock and former Republican Attorney General Charlie Condon. That was where I was in that report. That was all.

Also, you'll remember, Charles, because you were there when you had these earlier debates. I had candidates then, running against me, were saying all sorts of things about how I was gonna be all tangled up in the end. Of course, none of that was true. I'm not in the end. Even two of the assistant prosecutors came out and said so during, I think it was the runoff, that it was nothing about me in the end. There wasn't gonna be.

CHARLES BIERBAUER: Sir, if you continue as governor, what will your priority be?

HENRY MCMASTER: Well, I've already started that. Governor Haley appointed me and Travis Medlock, Former Attorney General Travis Medlock, to head the Ethics Reform Commission, which we did in 2011 and 2012. And we came up with a list of rec--you were on the commission, as you remember. We came up with a lot of good ideas, some of which, of course, were yours.

But we have instituted some of those. Now, as you know, the Ethics Commission, itself, can investigate. It can't prosecute. It oughta be able to prosecute. We wanted them to do that. And I'd like to see that done.

But also, I've asked, repeatedly, that we change the law so that lobbyists who--people who lobby at municipalities and also lobby at county council have to lobby, have to register, just like everybody else. So we'll know who they are. We'll know who's paying whom, and why they're there.

The other thing is the Freedom of Information Act is a powerful vehicle for the truth, and openness, and accountability. It ought to apply to the legislature-- to the House and the Senate. And I propose that. I proposed it in my State of the State address. I've requested it.

We're working towards it. And that was also in our report back then, which is viewed as the gold standard of ethics reform. All of those things, I've been working on them. And we're gonna get those done.

CHARLES BIERBAUER: Let me ask you both quickly one other thing about that report that came out. The grand jury report's harshest criticism seems to be leveled at current Attorney General Alan Wilson who's running for reelection. In your mind, does the attorney general have more to answer? Or is his functioning as attorney general in any way imperiled? Start with you, Governor.

- I don't know the facts of all of that. I think if anyone has any questions, they can certainly answer them. My understanding is that investigation is over. It sounds to me like there were many questions asked and answered.

I know a lot of documents were turned over. The number--it was a big number--were listed in there. I think if anyone has any questions, this is campaign time. Now's the time to ask them and get an answer if you want one.

CHARLES BIERBAUER: Representative Smith.

- I would agree completely. This is the time. Like Henry, I'm not sure of all of the details having not read the report. But the fact is this, these are candidates that are before the public right now. And if there are questions, they need to be answered to the confidence of the people of our state. And the decision about those issues will be made on November 6.

CHARLES BIERBAUER: Thank you, both. Andy Shain's next round starts with Representative Smith.

- Well, the race boils down to who voters think will do a better job in the State House, and who will represent best South Carolina to the rest of the world. You often, on the campaign stump, tell us why we should vote for each of you. Let me turn this around. I have separate questions for each of you.

So first to Representative Smith, Governor McMaster has now been on the job almost two years. Why should South Carolina voters fire him?

- Because he's not done anything.

HENRY MCMASTER: I think he's already covered that.

- I spent--there's a long list. I know. I might have to take a lot more than a minute, Andy. I tell ya. That's not fair to leave me with a minute. This is--there's no question. I mean, I don't think it's--well, I've known Henry for a long time. I just think he's not right for our future. He might have been the governor of 50 years ago. But the fact is we need to move South Carolina forward.

HENRY MCMASTER: I wasn't old enough 50 years ago.

- Really? OK. But the reality is this. Critical things need to change. We are not where we should be in education, in health care, in infrastructure, in the cost of our utilities, which we lost a major recruitment industry in the Midlands because the utility rates were too high. There are too many things that, right, there are some good things happening in parts of our state, but not in enough areas.

And there have got to be some critical decisions that are gonna need to be made for our future in order to make sure we lower tuition rates, and we improve the quality of our schools, and we improve the overall health of our state, and we improve the infrastructure before the next storm that's coming.

ANDY SHAIN: But what specifically has he done--

- All of those things--all of those things, I've offered specific plans to do. Henry has offered no change. It's all hunky dory. We're winning. I'm sorry. I just don't believe that that's the bright future that I see for our state.


- Governor McMaster, what would happen to South Carolina if James Smith is elected governor? What would the next--what would the next four years be like?

HENRY MCMASTER: Well, I'll put it this way. If business in this state, businesses, and if businesses that are looking for a place to go in the United States, were to believe or know that the governor of South Carolina had voted over, and over, and over, and over many times to raise taxes over a 22 year period, and I don't think ever voted to reduce taxes.

That believes in big government, as exhibited by the reliance on Obamacare. That has defended the union down in Charleston at Boeing, one of our best corporate customers, and has criticized me for telling the National Labor Relations Board that those people who were trying to unionize did not qualify by the law. And it should not be there.

And one who has also gone against places like the Miracle Hill Ministries that is a ministry of--they treat addictions. They have hundreds of people every night. And what they wanted to do was to see that in their work, that they were looking for Christian parents to adopt children.

That is perfectly OK. And I said so and reversed a regulation to allow that to happen. I was criticized by Mr. Smith. I think you take those things, and put them all together, and that is a killer on business growth and development, which is the answer to most of our problems, at least in part.


ANDY SHAIN: Representative Smith.

- I can tell you, if things are as Henry says they are, then why do the past two presidents and CEOs of one of our most important manufacturing, Michelin, Jim Morton and Dick Wilkerson, had a choice in this election. And both of them have choice to endorse and support me in this race because they know I'm good for business in South Carolina.


ANDY SHAIN: Governor McMaster, do you have a rebuttal?

- Sir?

- Any rebuttal in, you know--

- Listen, I talk to these people all the time. They are happy I'm where I am. They want me to stay where they are because they know we are growing. There's not another state that can keep up with us if we do not raise taxes, if we do not-- if we get rid of regulations, and if we do the right things, and we don't become known for being a union state.

We have the lowest participation of unions in the United States. That's a horse and buggy institution. We don't need it anymore. The managers and the people that work for the company, they talk to each other. They eat together. They play together. We don't need that level of bureaucracy anymore.

And I've talked to these people from all over the world. They are thrilled with the job I'm doing. They are thrilled with the direction of the state. And they're coming.


HENRY MCMASTER: And I've been saying--

CHARLES BIERBAUER: Gentlemen, we've got about two minutes left. I'd like to give Andy time for a quick question and relatively quick answers.

ANDY SHAIN: Very good. Governor, you raised the issue of Miracle Hill, which basically boils down to the issue of religious freedom.

HENRY MCMASTER: That's right.

- Why is it important to have religious freedom, to allow a place like Miracle Hill to not accept folks who they say don't adhere to their faith or follow the tenets of their faith.

HENRY MCMASTER: Well, two reasons, one is the Constitution of the United States, and the other is the Constitution of the State of South Carolina, both guarantee freedom of religion. If people want to pray, they oughta be able--if they want to pray, they oughta be able to pray the way they want to, whether it's in private, in church, or right here on this floor.

ANDY SHAIN: But do you think the founding fathers thought it was OK to not allow Jews, Muslims, gay people to be able to have foster kids from an agency?

HENRY MCMASTER: I think the founding--you know, the "in God we trust" is on our money. It's inscripted all over the House and the Senate of Washington. Everybody else was speaking about the religious and the faith. We're right in the middle of--we are the middle buckle of the Bible Belt. And that's one thing that makes us different from a lot of other places.


- But that is a perfect example of how they should be allowed to exercise their faith. They're not hurting anybody by doing that.

- Thank you. I need to let Representative Smith answer that question before we wrap up. Thank you.

- Henry, again, this was another place where you're deeply wrong and offend, I think, the values and sensibilities of the people of our state. We do have the protections of the right to free exercise of religion. But we also have to protect against discrimination.

And Andy, you just said it. South Carolina's values don't, I believe, reflect saying, we're gonna deny you access to be a foster parent because you're Jewish, or because you're Catholic, or because you're gay or lesbian.


You can protect the free exercise of religion. And I believe there are parents out there that deserve to have the opportunity and would be great foster parents for these children, regardless of their faith or orientation.

CHARLES BIERBAUER: Thank you very much. And I want to thank all of you.


I've got about 15 seconds to do this. Gentlemen, thank you very much for being with us. Thanks to my colleague, Andy Shain of The Post and Courier. Thanks to all of you, all of you watching. We get to do this again in eight days from Greenville. Please join us. For everyone at ETV, I'm Charles Bierbauer. Good night.