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Haley calls for lower taxes, tort reform

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By James T. Hammond
jhammond@scbiznews.com
Published Jan. 19, 2012

Gov. Nikki Haley gave an upbeat assessment of South Carolina’s progress over her first year in office in her State of the State address Wednesday night, characterizing the state’s recovery from the recession as “surging.”

05/29/08 Columbia, SC: Nikki Haley. Photos by Renée Ittner-McManus/rimphotography.com 803.622.4054
Gov. Nikki Haley
But she also used the platform to critique the labor unions in South Carolina, attacking them as unwelcome in this right-to-work state.

“I love that we are one of the least unionized states in the country. It is an economic development tool unlike any other,” the Republican governor said. “Our companies in South Carolina understand that they are only as good as those who work for them, and they take care of their employees. We don’t have unions in South Carolina because we don’t need unions in South Carolina.”

Haley singled out the Machinists’ union in her speech and scorned their attempt to shut down Boeing’s new plant in North Charleston.

“They will do everything they can to invade our state and drive a wedge between our workers and our employers. We can’t have that,” she said. “Unions thrive in the dark. Secrecy is their greatest ally, sunlight their most potent adversary.

“We can and we will do more to protect South Carolina businesses by shining that light on every action the unions take. We will require unions to tell the people of South Carolina how much money they are making on our backs, which politicians they are funding, and how much they are paying themselves,” Haley said.

“We will protect the right of every private and public citizen to refuse to join a union, and, by executive order, I will make it clear that our state will not subsidize striking workers by paying them unemployment benefits,” Haley said. “And we’ll make the unions understand full well that they are not needed, not wanted, and not welcome in the state of South Carolina.”

Several legislators took Haley to task after the speech, saying that she overlooked past contributions of unions in raising employee salaries and improving working conditions.

Rep. Wendell Gilliard, D-Charleston, said it was essentially an anti-union speech and pointed out that unions represent less than 3% of the workforce in South Carolina.

Rep. Joe Jefferson, D-Berkeley, noted that he is a member of the mail-handler’s union and criticized Haley for her anti-union rhetoric.

Haley spent much of her speech talking about the economic development record of her first year in office, noting the more than 20,000 jobs that have been pledged by employers and the $5 billion in planned capital investment.

“When this administration came into office, just over a year ago, with unemployment in double digits and growing, our focus was almost singular — jobs,” she said.

While South Carolina has made progress in 2011, Haley said, the state still has a ways to go. Haley said she will not rest until every S.C. citizen who wants a job, has a job.

“As we talk with CEOs from around the world, their focus is clear: keep the cost of doing business low. Our agencies have taken strides to reduce regulations and fees, and to change the culture so that every single employee understands that if government is costing our businesses time, we are costing them money. And that is unacceptable.

“My ask of you today is to remember that there is always more to be done on tort reform. Looking at the states we compete with — the Tennessees, the Alabamas, the Virginias — it would be naive to think they will settle for playing second fiddle to South Carolina in the economic arms race. They will scrap for jobs every bit as hard as we will,” she said.

“And the greater the protection we give our people and businesses from frivolous lawsuits, the better positioned we will be to capitalize on other assets.

“The next step in tort reform is a loser-pays system, so that there is a real cost to suits that waste the time and money of our businesses and our courts, and that our companies understand that South Carolina won't stand for trial lawyers playing games with their bottom line.”

Haley said she’ll also have new initiatives to strengthen the state’s workforce.

“The tools for an effective job training program already exist — we just need to do a better job of putting the puzzle together. Our technical colleges and vocational rehab programs are as good as any in the country. ReadySC has proven, time and time again, it can deliver the workers our companies need — and deliver them swiftly.”

Haley said she will unveil a restructuring of the state’s workforce training program this month.

Tax reform will also be high on her agenda this year.

“Every conversation we have with CEOs at some point drifts to our tax structure, and we have been communicating with Rep. Tommy Stringer and his tax reform committee on how we move forward with real changes this year,” she said.

“Our budget includes almost $140 million in tax cuts for the people and businesses of South Carolina. These cuts will flatten the individual income tax from six brackets to three, reduce taxes for the citizens of our state by almost $80 million, and phase out the corporate income tax over a four year period, injecting much needed dollars back into our businesses and giving us an unbelievable economic development tool.

“The tax relief we ultimately adopt must be broad-based, offering relief to as many South Carolinians as possible. And these tax cuts should mean lower rates — not more credits, exemptions, and loopholes that only benefit a chosen few,” Haley said.

Haley noted business concerns about the competitiveness of South Carolina’s ports, and she pledged to create a port infrastructure fund in her executive budget proposal to the Legislature.

“Let me start by assuring you that no one will work harder to get the funding necessary to deepen the Port of Charleston,” she said. “Part of South Carolina’s advantage in recruiting industry is the Port of Charleston. It is a huge part of why companies like Bridgestone, like Continental, like Michelin come to and expand in our state.

“From the first day of our administration, I have worked with our federal delegation to clear away all of the impediments to making Charleston the premier port in the Southeast — starting with getting the port to the post-Panamax depth of 50 feet,” she said.

“There has been much discussion about DHEC’s decision and whether two viable ports in the region are good or bad for the economics of South Carolina businesses and our state. I have said it before, and I will say it again: I am not afraid of a 48-foot Georgia port, 36 miles up the Savannah River, confined to one-way traffic,” she said. “You should not be either.”

Senate President pro-tem Glenn McConnell, a Charleston Republican, criticized the governor’s role so far in negotiating rights on the Savannah River for Georgia to build a new port. McConnell said the agreement Haley has supported will only harm South Carolina, putting new port facilities on the Georgia side of the river, dumping cadmium-laden dredge spoil on the South Carolina shore, and yielding a dead river ecology.

Sen. Jake Knotts, a Lexington County Republican, said Haley dwelled too much on the past in her speech.

“I didn’t hear much about what the future is going to be,” Knotts said.

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