Rep. Tad Campbell, R-Meridian, asked Rep. Joe Warren, D-Mount Olive, if he had seen another example of a federal law that trumped the state
Constitution and state law like Campbell said the stimulus package did.

Warren said he could not recall one, but added it was unusual economic times and extraordinary measures were needed.

Come on guys.

Federal law overrules state law all the time. There are countless examples – huge examples that any amateur observer of Mississippi history should know.

Federal law superseded the state and gave African Americans the right to vote in the 1960s. In the 1980s federal officials stepped in and said the state Constitution and law that denied Northeast Mississippi 16th Section school land revenue that other parts of the state benefitted from was unconstitutional.

I could go on and on about where federal law trumped state law. And by the way it happens in all states – not just Mississippi.

I give Warren and Campbell the benefit of the doubt. They must have been doing what we all do on occasion – not thinking before speaking.

Usually they are non-controversial. And when honoring youths they are always non-controversial.

But that may change.

For a number of years, the Legislature has passed resolutions proclaiming Spirit of America Day and recognizing Mississippi high school athletes who receive Spirit of America recognition.

It seems innocent enough. But the only problem is that the whole event is spearheaded by attorney Richard Barrett, a unapologetic white supremacist based in south Hinds County and occasional candidate for public office.

In past years, legislators for the most part either did not know about Barrett’s connection or either turned the other way.

But it appears that this year some members of the state House might fight the resolution.

That will put members in a bad situation — opposing a resolution honoring children from their colleagues’ districts. Perhaps, the parents and students did not know of Barrett’s background and beliefs. And as a father, just about any honors my children receive are welcomed and cherished. Goodness, parents are proud of any positive recognition their children get.

That is understandable.

But by the same token, people have to ask about the value of accepting an award from someone who through our state’s history has continued to spew hate.

And legislators have to ask do they want to continue to legitimatize someone of Barrett’s ilk by passing resolutions that he can tout? At this point he should be considered an anachronism in our state and someone to be tolerated but not legitimatized by official acts of the Mississippi Legislature.

The fact that teen-agers are caught up in this issue is a shame and makes it difficult for House members.

By the way, the Senate also passed the resolution.

But the versions passed by the two chambers had at least one key point in common. Both chambers passed legislation based on the
assumption the increase – whatever size was finally agreed to – would take effect this fiscal year.

The Senate, in particular, talked about a March 1 enactment date to garner funds this fiscal year to ensure that local governments had enough money to prevent a possible increase in the cost of car tags.

February is quickly slip-sliding away and the negotiators appointed by House Speaker Billy McCoy, D-Rienzi, and Lt. Gov. Phil Bryant, who
presides over the Senate, have yet to meet – at least in public.

The state Tax Commission had said it would take about 30 days to enact an increase in the cigarette tax.

It is becoming less and less likely any additional money will be raised from an increase in the cigarette tax for this fiscal year,
which ends on June 30. With the state budget in a mess, legislators are missing an opportunity.

Maybe, at this point they are just counting on the federal stimulus package to bail them out.

During debate on the legislation, Powell opposed the Senate leadership position of a 31-cent increase to 49 cents per pack. He supported a larger increase.

Powell’s position will be overruled by the two other Senate negotiators, Finance Chairman Dean Kirby, R-Pearl, and Vice Chairman Buck Clarke, R-Hollandale.

Still, it is unusual that a freshman from the presiding officer’s opposition party is named to be a key negotiator on one of the largest pieces of legislation of the 2009 session. It speaks to the respect he has engendered in the chamber.

The thee negotiators appointed by Speaker Billy McCoy, D-Rienzi, are Ways and Means Chairman Percy Watson, D-Hattiesburg, Bobby Moak, D-Bogue Chitto; and Angela Cockerham, D-Magnolia.

The incentive package, which could total as much as $20 million in loans and grants, was promised to Cooper when the company announced
intentions to close one of four North American plants. Cooper opted to close a plant in Georgia.

JACKSON – James Maxwell, an assistant U.S. attorney for the Northern District of Mississippi, was appointed to the Court of
Appeals Tuesday by Gov. Haley Barbour. Maxwell will replace David Chandler who won a seat on the Supreme
Court during last year’s elections.

JACKSON – Setting deadlines for where legislation must be in each step of the process serves a useful purpose.

Legislative deadlines help curtail one of the most basic human traits – procrastination. Deadlines spur legislators to act. In essence all deadlines are built around constraints placed on the Legislature by the Mississippi Constitution. For years, the deadline for the leadership to agree on a budget, followed by the deadline for the full membership to pass that budget have in effect served the purpose of being an enemy to open government.

The turnaround between those two deadlines is so quick that the legislative staff does not have time to develop in a readable format an overall budget picture. Instead, the members vote on more than 100 budget bills individually – often packed with little gems – and the full membership and the public really cannot ascertain the full budget picture as those votes occur.

Senate Appropriations Committee Chairman Alan Nunnelee, R-Tupelo, wants to extend the time between the two deadlines to give the members and the public time to digest the budget. While it may seem like an inside-baseball type of issue, Nunnelee’s proposal at its core is an open government issue.

Good for him.

Rep. Steve Holland, D-Plantersville, reviews the state Democratic Party’s response to Republican Gov. Haley Barbour’s State of the State address, Tuesday at the Capitol in Jackson, Miss. (AP Photo/Rogelio V. Solis)

JACKSON – Gov. Haley Barbour and state Rep. Steve Holland of Plantersville don’t always see eye to eye, but they go way back to the early 1980s when the loyal Democrat Holland was, gulp, an active member of the state Republican Party.

Their relationship during Barbour’s tenure as governor has gone back and forth from warm and friendly to rocky.

During Tuesday night’s State of the State speech, Barbour called out his old friend, the colorful Holland, by name. “We’re back to find Rep. Steve Holland a shadow of his former self.

After losing 80 pounds, Steve’s the new poster boy for Let’s Go Walking, Mississippi, and Rep. Herb Frierson (of Poplarville) is not far behind having lost 40 pounds…You’ve put the governor back on his diet, guys,” said Barbour, who often jokes about his own weight and his fondness for food.

After the speech, Holland told first lady Marsha Barbour to have her husband meet him every morning for a walk, and he could help the
governor shed the pounds.

Considering their often adversary relationship, more calories than normal could be burned during those morning walks.

What did you think of Gov. Barbour’s speech? Comment below.

PREPARED REMARKS OF GOVERNOR HALEY BARBOUR

2009 STATE OF THE STATE

January 13, 2009

Governor Bryant; Speaker McCoy; ladies and gentlemen of the
Legislature; and fellow Mississippians:

Tonight marks the sixth time you have allowed Marsha and me to join you here to report on the State of our State. I am greatly and eternally honored the people of Mississippi have granted me the privilege to serve as their Governor, and I am grateful to be blessed with the very best partner in this that a man could ask for, my bride of thirty-seven years, Marsha.

In the last five years I have joined you in more than speeches. At the beginning we addressed a $720 million dollar budget hole; we ended
lawsuit abuse with comprehensive tort reform; we overhauled and greatly improved workforce development and job training; we used Momentum
Mississippi to accelerate economic development and job creation; we upgraded education and increased state spending on all three levels -
K-12, community colleges and universities – by record amounts; and we did it all without raising anybody’s taxes.

I say “we” did those things, not because everybody agreed on every single issue, but because government is a team sport, and we’ve been
moving forward together.

Now we’re back to find Representative Steve Holland a shadow of his former self, after losing eighty pounds. Steve’s the new poster boy
for Let’s Go Walking, Mississippi, and Representative Herb Frierson is not far behind, having lost forty-six pounds. You’ve put the Governor
back on his diet, guys.

Each year as I prepare to write my State of the State address . . . and I do write them myself . . . I always go back and read the previous
year’s speech.

I’ve asked that each of you receive a copy at your desk tonight because it reminds me of what we can do, working together.

Last January, as I said, the State of our State was good, in some ways extremely good. But I also said, “We have the wind at our backs, but
there are storm clouds on the horizon.”

We had record employment last year, and, indeed, the number of people working in our state continued to increase into the second quarter. Per
capita income had increased nearly one-fourth the previous four years, and there were thousands of new, high-paying jobs in the pipeline.

But, as I said then, those “storm clouds” were already obvious – a weakening national . . . and as it turned out . . . international
economy, and serious troubles in the financial markets. Although it wasn’t proclaimed at the time; America had entered a recession in
December, 2007.

Even though Mississippi’s economy was still growing stronger a year ago, I asked you to be prudent and prepare for the worst. And I
congratulate the Legislature for what you did: you controlled spending in a responsible way. More important, you filled the Rainy Day Fund to
the statutory limit . . . to prepare for the downturn and to avoid the budget hole we had found ourselves in when I came into office.

Mr. Speaker and Governor Bryant, I want to personally thank and commend each of you . . . and Senate Appropriations’ Committee Chairman Alan
Nunnelee and House Appropriations Committee Chairman Johnny Stringer for the discipline they showed and the results they achieved.

Similarly, the Legislature kept the lid on bonded indebtedness. Except for job creation projects, no more bonds were authorized in 2008 than
the State either paid off or de-authorized. Since debt service is one of the largest costs in the state budget, this is doubly important. And
I want to recognize and thank House Ways and Means Committee Chairman Percy Watson and State Finance Committee Chairman Dean Kirby for their
accomplishments.

The “storm clouds” of the then-approaching recession arrived in Mississippi later than the rest of the country because our economic
growth of the last three or four years still had more momentum than many other places.

The residential building depression certainly hurt our homebuilders and both our furniture manufacturing and forest products industries, and the
damage got worse later in 2008; but most areas of the state didn’t have the catastrophic collapse felt by Florida, California or many other
states.

Four dollar gasoline hurt Mississippians more than most. The disposable income of many of our families simply disappeared into the
gas tank. Our growing automotive industry cut back as sales declined sharply. Ultimately, the floundering global automobile market delayed
more than four thousand jobs coming on line at Toyota, its suppliers and at PACCAR.

Finally, the financial sector’s turmoil and the accompanying stock market dive put Mississippi into net job losses . . . and per capita
income declined slightly later in the year.

As we all know, one effect of a recession is declining state tax revenue, and in December, after months of small, manageable declines,
Mississippi’s revenue nosedived far below the predicted levels . . . in fact, December’s tax receipts missed the revenue estimate by nine
and a half percent, overall revenue by eight point three.

It’s very challenging, but we’re actually a lot better off than many of our neighbors:

● Last month Governor Riley of Alabama had to cut education spending for this year by three hundred fifty-three million dollars.
Additionally, he cut general fund spending by ten percent.

● Our neighbors in Florida have already cut state spending for this year by six billion dollars, the largest year to year drop in state
history.

● Georgia Governor Sonny Perdue has cut the Peach State’s operating budget by six per cent.

● In Louisiana Governor Jindal and legislative leaders jointly announced three hundred fifty-one million dollars of cuts necessary to
meet this fiscal year’s certified revenue shortfall.

● Tennessee’s State Funding Board estimates a revenue shortfall for this year of nine hundred forty-six million to one point one four
billion. Governor Bredesen has told universities they will receive ten to fifteen percent cuts, and he has told state department heads to shave
their costs by twenty percent.

It is little consolation to know our neighbors have bigger cuts to make than we do, but it is important to make plain that these budget problems
are the result of an international, not just a national recession.

And that recession, which is getting worse right now, is likely to be the longest and deepest recession since those of 1979-1982 or perhaps
since World War II.

It is our duty to prepare for such a recession . . . to err on the side of financial caution . . . to be prudent and conservative with the
taxpayers’ money.

Most of our viewers are probably aware that Mississippi’s Constitution and our statutes require the State to have a balanced
budget. They probably don’t know how our laws mandate we meet that requirement.

There is a law . . . a statute . . . Section 27 104 13 of the Mississippi Code that orders the Governor to make enough cuts in
appropriated state spending to eliminate any deficit spending, if State revenue comes in lower than the estimate on which the appropriations
were made by the Legislature.

As you know, to comply with the mandate of this law, I made forty-two million dollars in spending reductions affecting many state departments
and agencies back in November. I held others, like the Mississippi Adequate Education Program, harmless from these cuts.

Now there has been a large revenue shortfall in December. And our economy has begun to decline along the lines of the national economy,
which has fallen very steeply the last few months.

The State Department of Finance and Administration now estimates that revenue for this fiscal year, which ends June 30, will fall between one
hundred seventy-five and three hundred ten million dollars below the budgeted level.

The law gives me very little latitude about how I can distribute these cuts. The law says I can cut any department or agency by five percent
of its appropriation; however, I cannot cut any department or agency by more than five percent until every department and agency has been cut
five percent.

The effect of this law is that I can no longer exempt the Mississippi Adequate Education Program from cuts, as I did in the November round.
Cutting all the departments and agencies five percent, excluding court ordered spending and debt service, yields only about one hundred twenty
million dollars, if no cuts are made in MAEP.

To comply with the law I must reduce MAEP, though not by five percent. Even so, the news is not as bad as it could be.

Just as the Legislature has been prudent in filling the Rainy Day Fund, our school districts have done a great job of setting aside their own
Rainy Day Funds. Last month the State Department of Education reported our local school districts have five hundred seventeen million dollars
in their Rainy Day Funds, or fifty percent more than the state’s own Rainy Day Fund. Some eighty-four percent of the districts have more
than five percent of their MAEP allocation in reserve already.

It is anticipated President-elect Obama will get a stimulus package passed by Congress; but we cannot hold off making the legally required
cuts. Here’s why:

We are already halfway through the fiscal year, so our agencies that didn’t get cut in November will now be forced to reduce spending by
ten percent for the last six months of the fiscal year to achieve a five percent cut for the entire year.

If we wait till March to see what Congress gets done in February, it would take a fifteen percent cut for the last four months of the fiscal
year to get a five percent annual reduction. It would be irresponsible to impose such cuts on an agency, if it can be avoided.

For next year’s budget, which you will address during this Regular Legislative Session, you obviously are not bound by the law that
requires everything to be cut five percent before anything can be cut more than five percent, and I pledge to work with you on
prioritization.

As required by law I submitted my Executive Budget Recommendation last November. It proposes prudent reductions in state spending; it includes
the Tax Study Commission’s proposal for increases in tobacco taxes early in the Session, for this fiscal year; and, very importantly, it
would use slightly less than one-fourth of the Rainy Day Fund to allow eighty-five million dollars more spending for priorities like education
during this period of reduced revenue.

If there is one point I want to emphasize: it is essential the Rainy Day Fund last us four years. It would be irresponsible to spend it at a
faster rate.

The recession is deepening. Unemployment is going up fast . . . to seven point two percent nationally in December, the same rate as
Mississippi . . . seven point two percent.

Industrial production is declining, which means more layoffs or fewer hours worked . . . and retail sales, which were far below predictions
before Christmas, can’t be expected to improve anytime soon either.

Again, I urge you to ensure the Rainy Day Fund lasts us four years.

Just as you were very prudent about authorizing bonds last year, I ask you not to authorize any bonds except for job creation until we have
seen the federal stimulus package. I am glad to tell you that early in this Session we will be asking you for bonding authority for protecting
and increasing jobs.

And this is a good time for me to thank the Mississippi Development Authority and local economic development leaders for their successful
efforts to keep and expand Cooper Tire; to replace ACT Electronics with Ayreshire Electronics, and to save Heartland Building Products and
Outdoor Technologies.

While it was a deep disappointment that Toyota postponed the start of production at its new Blue Springs plant, I’m glad to report Toyota
and its suppliers have emphatically said the Prius plant will definitely go forward when market conditions improve. During yesterday’s
coverage of the Detroit Auto Show, where Toyota introduced the next generation Prius . . . it was reported repeatedly that it will be built
at the new plant in Mississippi.

And it is a mark of the kind of outstanding corporate citizenship Toyota practices that the company will pay the State ten million dollars
a year to cover its portion of the extra costs as long as the start of production is delayed. They and their suppliers are doing the same for
our affected local governments, and the company will make its first of ten, annual five million dollar gifts to local school districts next
year.

Know I consider job creation the number one goal of my administration . . . especially in a national recession. It won’t be easy . . . but
while I’m concerned about the global economy, I’m optimistic about Mississippi.

We can come out of this recession stronger and pick up where we left off less than a year ago, if we’ll work together, use budget prudence
and keep the faith in ourselves that got us Toyota, General Electric, PACCAR, Gulf LNG, PSL- North America, ADP, NEW, EADS and on and on; not
to mention the strength and courage that brought us through Katrina.

And if job creation and protection stay at the top of our agenda, completing the recovery and rebuilding from Katrina on the Coast are
also foremost. While much progress was made in 2008, there is still more to do.

Twenty-seven thousand families have received nearly two billion dollars in homeowner’s assistance. Three programs were implemented last year
to spend seven hundred million dollars for some twenty thousand units of affordable housing to be owned or rented by low and moderate income
families. It is projected there will be more affordable housing in the three coast counties in 2011 than before Katrina.

Economic development and community revitalization projects are under way to restore the area’s quality of life. The redevelopment of the
Port of Gulfport is deep into permitting. With the coming expansion of the Panama Canal, the redevelopment of our State Port will not only
serve the Coast and Mississippi, it will be a national strategic asset that serves the country’s increasing need for additional container
capacity for both exports and imports.

While there are many detailed, technical Katrina issues to finish with the federal government, there are two significant, large issues
outstanding with Washington:

1) The Stafford Act, the federal disaster assistance law, entitles the State to some four hundred thirty-four million dollars in Hazard
Mitigation Grant projects. That law requires state and local governments to pay a twenty-five percent match. This is why we have a balance
remaining in the Disaster Trust Fund we set up after the storm.

2) Congress has not addressed our 2005 request for funds for environmental restoration and hurricane hazard mitigation. At
Congress’ direction the Corps of Engineers has drafted a report, proposing the State receive nine hundred fifty-two million dollars for a
series of projects, including rebuilding our barrier islands, to protect us and to restore our coastal wetlands and forestlands. This request is
the only part of the State’s recovery plan, submitted to Congress and the Administration in November, 2005, that Congress has not acted on.

We will continue to work with Congress and with the new Obama Administration on these big issues and many other smaller ones.

In speaking of the new President, I was impressed that he invited all the governors to meet with him last month. Not only was he gracious, he
seemed genuinely interested in the views of those who did not agree with him on everything as well as those who did.

I look forward to going to Washington for his inauguration and to having a positive, productive relationship with him and his team.
Regardless of how you voted, he is our President.

Now let me visit with you and our viewers about two huge policy issues closer to home: education and health care.

Education is the number one economic development and quality of life issue in our state and every state. When I say education, I include not
only K-12 but also workforce development at our community colleges, commercially viable research at our universities and early childhood
education: all in all, lifelong learning.

You have authority in crafting the FY 10 budget that I don’t have in balancing this year’s budget, and you don’t need me to tell you
education has to be the highest priority, but I urge you to prioritize within the education budget, too.

The program to redesign high school and reduce dropouts not only can but must reinvigorate our high schools. This “redesign” program, if
it succeeds in keeping kids from dropping out of high school, will save tens of thousands of young Mississippians and lead them to be productive
citizens.

The private sector has joined the Department of Education, The Early Childhood Institute at Mississippi State, and scores of pre-school
programs – whether church, for profit or not, or Head Start – to create from the existing pre-K infrastructure, which already serves nearly
ninety percent of our State’s four year olds, an extremely promising program to get children ready for school by age five. I hope you’ll
keep an eye on this program and support it. Having a kid read at grade level by the third grade makes all the difference in the world for that
child’s future.

My most immediate concern about education funding is not MAEP, especially with the school districts’ Rainy Day Funds flush with five
hundred seventeen million dollars.

My most immediate concern is how to keep funding workforce development and job training at current or higher levels. There is no doubt in my
mind that the well recognized improvement in the quality of our workforce was central to our great job creation successes of the last
few years. Company after company from Toyota to General Electric … manufacturers to services to information technology … auto, aerospace,
shipbuilding, energy, steel … love and praise our workforce but say we need to increase the number of highly skilled workers.

We’ve got to help more of our workers upgrade their skills. We owe it to them, and it is key to our economic growth.

Now, here’s the problem: More than twenty million dollars a year of our job training budget comes from a diversion of one-third of the
unemployment insurance tax paid by Mississippi employers to the Workforce Enhancement Training Fund created in 2005, with the permission
of the U. S. Department of Labor. These funds are the backbone of our community college’s workforce development program; they represent
about a third of workforce training funds.

On average, individuals who received training through services as a direct result of this fund, saw their annual wages increase by $4,000.
We can’t afford to lose this program for our working people.

But, if the balance in our unemployment insurance trust fund falls below a certain level, we will lose that diversion and, therefore, more
than twenty million dollars in job training. I urge you to replace these funds with state funds if it becomes necessary. For the short
term, it is critical.

Higher education – universities and community colleges – was cut deeply in the Musgrove Administration. As you prepare the FY 2010 budget I ask
you to fund higher education at levels that allow it to play the critical roles it has in generating economic growth. This is essential
to job creation, especially during a challenging economy like this recession.

The State’s biggest health care program … the second largest item in the State budget … is Medicaid.

Medicaid is up for reauthorization this year … that is, the current State Medicaid law expires June 30.

There are about five hundred eighty thousand people on Medicaid today. That number has fallen by more than one hundred thousand since I became
governor. We’ve had record employment in our state month after month in the last few years. When sixty thousand more people are working, it
means a lot fewer people are eligible for Medicaid. Our requirement for face-to-face eligibility redetermination is another key factor.

Now, unemployment is going up, and employment is going down. That means more people will be eligible to sign up for Medicaid. It’s
inevitable there will be upward pressure on Medicaid spending.

The financial problem at Medicaid today, as you in the Legislature already know, is not overspending; it’s a federal rule change
concerning state match. The State must put up twenty-four cents as our part of Medicaid spending, and the federal government matches it with
seventy-six cents.

To pay our match requirement the State normally collects about three hundred million dollars a year from hospitals and nursing homes in
taxes, known as provider fees. This represents about thirty percent of the state match, and without it, either the State would have to raise
taxes three hundred million dollars or the Medicaid program would have to be cut thirty percent or one point two billion dollars . . . or some
other programs like education would have to be cut.

The hospitals and nursing homes actually asked the Legislature for these taxes, and have paid the taxes gladly. The reason is, they get a
huge return for their money. In the case of the hospital tax at issue now, the hospitals get back six dollars for every dollar they pay in.
Pretty good return, huh?

In 2005 the federal Medicaid agency said the way the State collected this tax on hospitals didn’t comply with federal rules, even though
we’d been doing it that way for thirteen years . . . at the request of the hospitals.

A couple of months after the feds made this decision, Katrina struck; so this problem took a low priority, especially after the federal
government gave emergency health care funds to the State that we could use to replace the ninety million tax or provider fee the hospitals had
been paying since 1992.

Well, that federal money has run out, and it is past time to find a fair, permanent, sustainable way to replace this ninety million dollars
and fully fund Medicaid.

The choices haven’t changed: We can give the hospitals a ninety million dollar tax break and raise somebody else’s taxes to allow the
hospitals not to pay their fair share; or, we can give the hospitals a ninety million dollar tax break and cut Medicaid spending accordingly,
which amounts to two hundred seventy-five million a year, including the federal share; or, the hospitals can pay their fair share, ninety
million and not cut the program.

To me, it is a clear choice. We should reinstate the hospital tax, and the hospitals, who asked for this provider fee because it pays them back
six dollars for every one they pay in taxes, should pay their fair share as they did all those years.

In addition to this long-standing issue, Medicaid is up for reauthorization this year.

Despite the ninety million dollar hospital tax cut issue, Medicaid spending has finally been brought under control.

The pharmaceutical program is a good example: About seventy-five percent of Medicaid prescriptions are now filled with generics, which
work as well and cost a fraction as much as brand name drugs. Because of this, the state pays ninety million dollars less than it did in 2005
for the pharmaceutical program.

The agency could save still more and not reduce the quality of care if it were given authority to adjust rates and benefits to reflect changes
in medical and health care practices without requiring legislation.

This year Medicaid will test a program of Coordinated Care for certain high cost beneficiaries. The goal is to improve access to care, provide
higher quality and do it cost effectively . . . without reducing rates for providers or benefits for Medicaid recipients.

In tough budget times like these . . . when departments and agencies must get along with reduced appropriations . . . I urge you to reform
state government: to give leaders maximum flexibility to run their agencies effectively. They need lump sum appropriations. Most need
relief from Personnel Board rules, if they are to reorganize their departments to do the job we expect of them, within the money we can
afford to give them.

The federal highway and transportation law expires this year and will be reauthorized. After it is reauthorized, by which time we will have
already seen the stimulus package, Mississippi needs reform in our highway and transportation program. Our method of financing is becoming
obsolete, and we must incorporate economic development and job creation into our selection process.

As you know our Charter school law sunsets this year. Recently, House Education Committee Chairman Cecil Brown was quoted as saying, “The
current law is too limited.” I agree and urge you to expand the options parents have to improve their children’s educations.

Two areas at which my Administration will look to see if we can improve performance and save money are the Bureau of Alcohol Beverage Control
and the Drivers License Bureau at the Highway Patrol. We will study whether contracting out these services or parts of them would make the
State money and, more importantly, improve service to our citizens. For instance, the vast majority of states have privatized the part of their
ABC operations that handles wine, with positive results.

You will have bills before you to put transparency in our contracting out for legal services, and in light of news stories from the criminal
courts over the last year or so, I support the idea.

Election laws will be before you again, as to Voter ID and early voting. I have long supported early voting beyond our current absentee
ballot law, but it is critical the process can be and is implemented in ways that guarantee ballot integrity for individuals; ballot security
throughout the entire early voting period; and a counting and tabulating system that is at least as open and protected as for ballots cast at the
polling place on election day.

As to Voter ID, it is past time we catch up with our sister states and with business, medical, financial and the rest of the government world
by requiring a picture ID to vote. And I must tell you, no state in America grants an exemption from showing an ID to vote because of age.
There is no reason or example for excluding people on the basis of age.

Last year I proposed the creation of a Mississippi Health Insurance Exchange to help small businesses and their employees get private health
insurance. The Senate passed that bill fifty-two to nothing. The House did not consider it last year, and I hope you will join us this year in
an effort to significantly increase the number of Mississippians with private health insurance.

In that vein I applaud Blue Cross Blue Shield of Mississippi for considering elimination of the exclusion for pre-existing conditions for
health insurance coverage for employees of companies with two to fifty in their groups.

I think it’s appropriate to mention this Blue Cross proposal for a couple of reasons: One, it really would allow many more people to get
private insurance and I urge every insurer to consider it; but second, it is a reminder that it is the private sector that makes the greatest
difference in what happens in our economy.

It’s the private sector that creates the vast majority of jobs and employs eighty-something percent of workers. The private sector drives
the innovation that allows our businesses to stay competitive; and to pay higher wages and salaries, to provide quality health insurance and
critical retirement plans.

Only the private sector creates wealth; the government doesn’t do that. It can’t. In fact, government has no money except the money it
takes from our people and their businesses.

We need to be particularly aware of that fact in tough economic times like these: Government has no money except what it takes from our people
and their businesses.

Now this is not an argument against government. Government services are indispensable to our society.

You can’t have growth and prosperity without security, and that’s why public safety was the first of all government services . . .
thousands of years ago.

Often I hear preachers pray for our men and women in uniform in Iraq and Afghanistan . . . and rightly so. But I also pray for our men and
women in police uniforms, or uniforms of firemen, deputy sheriffs or highway patrol officers. The same goes for prison guards, parole
officers and EMT’s.

We’ve already talked about education’s critical role in job creation, and we could go on about social services or the judiciary.
Government plays essential roles. We just can’t overburden our citizens with taxes, especially when our citizens are themselves already
strapped by a bad economy. We can’t tax our way or borrow our way into prosperity. Can’t be done.

My point, though, is that Mississippi’s future is and will be inexorably tied to the growth and vitality of the private economy.
More, higher skilled, better paying jobs for our children and grandchildren here in Mississippi can come about only if we continue to
have accelerated growth of the private sector in the years to come. We all know that.

We are in the midst of a major international recession that will get worse before it gets better.

I pray God will give us the wisdom and the courage to take the necessary steps during this trying period to prepare our State to be the
best positioned to be first out of the chute, to leap forward when the economy turns; to pick up where we left off with Toyota and the other
great catches of the last four years.

Katrina showed people around the world that Mississippians are the kind of people they want to work for them and with them; for our kids to go
to school with their kids; our families to go to church with their families. You in the Legislature have shown through the discipline of
building up the Rainy Day Fund and controlling both spending and bonded indebtedness that we can be good stewards of the taxpayers’ money,
which I promise you is key to attracting jobs. Our job creation professionals at both the local and state level are up to the task and
are demonstrating even in this deepest recession in at least a generation that they can promote Mississippi.

Now let’s commit ourselves . . . first to weather this storm responsibly and with fairness to all; and at the same time to prepare
ourselves to pounce on the best opportunities at the first sign this worldwide recession is ending.

If we prepare ourselves and our State, we can achieve the dream of tens of thousands of Mississippi mothers and grandmothers . . . the dream
that their children will choose to stay in Mississippi to pursue their careers because Mississippi is the place to be . . . the place where the
best jobs and opportunities are.

That dream was starting to come true before this recession struck, and it can still be our future, that future . . . which is in our hands.

Thank you, and God bless you. God bless America and our State of Mississippi.

JACKSON – Some have accused Gov. Haley Barbour of bringing Washington-style politics to the Mississippi Capitol.

The reference is to the partisanship that has intensified at the state Capitol during his gubernatorial administration. Barbour bristles at the notion – saying in the past it is Speaker Billy McCoy of Rienzi and the House Democrats responsible for the partisanship.

Recently, McCoy said everyone is responsible for the increased partisanship level and offered that he is willing to share some of the blame.

There is no doubt that Barbour is the state politician with Washington ties. He was President Ronald Reagan’s political director, chair of the Republican National Committee and successful Washington lobbyist who according to reports oversaw a firm that hired only Republicans.

At any rate, Barbour does bring one element of Washington politics to the Magnolia State. All six of his State of State’s speeches, including Tuesday’s, is held in the evening – as is done in Washington with the State of Union speech.

Before Barbour, Mississippi governors traditionally gave the State of State in the afternoon. Barbour says more people have an opportunity to see an evening speech after they get off work.

There is no word on whether Barbour designates one member of his administration not to attend the event – as it done with the president’s cabinet to ensure there will be someone to govern if – God forbid – the Capitol is attacked during the speech.