ANDERSON, Ind. — Flagship Enterprise Center President Chuck Staley presented a picture of what he called a “tale of two governments” Wednesday as he welcomed Gov. Mitch Daniels to Anderson.

After describing how he felt knowing that as an American he was deeper in the national debt every day, Staley praised Daniels for keeping Indiana out of debt, maintaining its credit rating and passing no new taxes.

“This morning I also woke up as a Hoosier, and our state government is in the black,” Staley said. “I believe we have a governor who’s minding the store.”

Daniels spoke Wednesday at the Flagship to business and community leaders and politicians, touting Indiana’s standing among other states after the effects of the economic recession.

“It doesn’t matter who rates the states ... Indiana’s always in the top tier,” the two-term Republican governor said.

The state has a history of being a low-cost area in which to do business, Daniels said, with inexpensive taxes, utilities and transportation and an attitude conducive to promoting business. It is one of four states in recent years to have changed its net migration from negative to positive, and Daniels said one of the worst things for the state was “some of our best people, and especially young people, deciding they would leave the state.”

State Rep. Terri Austin, a Democrat who represents parts of Madison County, said other states could be more attractive for young people because they support colleges and universities more than Indiana does. She said the state needed to look at supporting students who attend four-year colleges and universities and graduate thousands of dollars in debt.

“The state cut aid and lowered caps for students who attend private colleges and universities,” Austin said. “We’ve got to find a way to better support students in general. I think we also need to take a look at how many students actually graduate in a four- to five-year period.”

Daniels said that for the first four years of his administration, the state was aggressively courting businesses, but after the recession hit, it had acted to maintain its long-term advantages, such as low taxes, instead of pumping up short-term incentives.

“Here is the intersection of our economy and jobs future with the way we conduct the public’s business,” Daniels said. “We spent four years being proactive in economic development; now we try to avoid what other states are doing and be stable.”

Other states lose the ability to attract businesses when they are unable to keep the long-term cost of doing business low, Daniels said.

“Every time that happens, they slip a notch and we gain a notch relative to them,” he said.

Daniels outlined the ways Indiana had restrained its spending in light of the recession, including a hiring and wage freeze, cutting travel costs and make budget cuts to departments, including a 3 percent cut to K-12 education, which makes up half the state’s budget.

“In the last five years, we’ve made a big move in spending in frugality,” he said. “The very, very last resort was a reduction after several years of increases in K-12 spending.”

Daniels cited instances in other states that their administrations had used to cut costs while reducing services, including letting prisoners out of jail early, turning paved streets back to gravel and making extensive cuts to education.

“If I’m having trouble sleeping, I don’t have to count sheep, I count all the states I’m glad I’m not the governor of,” he said.

The state saw 20,000 new jobs committed in 2009, although a third of them came from plant closings in other states, Daniels said.

“Our goal over time is to do anything we can to drag income up in this state,” he said. “I don’t yet see ... that a rousing (economic) recovery has begun. When the music starts, Indiana benefits first and more than others.”

Austin said she thought people understood the fiscal challenges facing the nation, and the state should make its budget cuts carefully and only where it could afford to.

“I appreciated (Daniels’) recognition that we have tried to work in partnership,” Austin said. “I think we could be in far worse shape. We do have organizations that are taking real hits, like Medicaid-funded and long-term care facilities. We’ve got to find a way to close those gaps as well.”

Daniels said he was confident that economic conditions locally would turn around.

“I am very bullish on the future of this area,” he said. “I truly believe ... Anderson’s coming back strong. I know it, and we will do all we can to make that so.”



Contact Aleasha Sandley: 640-4805, aleasha.sandley@heraldbulletin.com.