The Pew Charitable Trusts

North Dakota Gov. Ed Schafer spent most of his final State of the State speech Tuesday talking about the wonders of modern high technology and how they can help his rural state. "We have a train to catch. It's the e-train," he said.

Following is Gov. Ed Schafer's State of the State address:

2000 State of the State

Governor Ed Schafer

Jan. 25, 2000

Lt. Governor Myrdal, First Lady Nancy, Supreme Court Justices, Tribal Leaders, Board of Higher Education members, distinguished legislators, students, teachers and others listening statewide on the radio or the Internet. Good afternoon.

Seven years ago, Nancy and I entered this Chamber, and I approached this podium for the first time as the 30th governor of this great state.

I was bursting with ambition. I was jittery with nervousness and enthusiasm. But most of all, I was full of hope for the future of North Dakota. Today, seven years later, my feelings are much the same.

When I took office:

• Our economy was suffering from a lack of growth and new jobs.
• State government was suffering from several years of revenue shortfalls.
• North Dakotans were suffering -- they were down on their luck and down on themselves.

At the time, the proposal on the table to solve these problems was to spend $167 million of the taxpayer's money to create more government programs.

Well, as you know, I promptly placed that proposal on a dusty shelf with other ill-conceived government plans. And instead, I declared an era of new opportunity for North Dakota.

My administration has put our faith in individuals, not government. And, together with North Dakota citizens, we have begun to realize the dreams of this new era of opportunity.

Together, we have diversified our economy with industries never before seen in this state.

Together, we have created 45,000 more jobs - that's the size equivalent of Dickinson, Towner, Scranton, Drayton, Tioga, Strasburg, Mandan, Minto, Edinburg, Minnewaukan, Hazen and three Lisbons.

Eight hundred new businesses line our streets. Hundreds of others have expanded.

Dozens of new crops and ag processing plants have put a new face on North Dakota agriculture. And with these advances, agriculture will prosper again when bad weather, bad prices and bad export policies pass. Together, we've increased funds for K-12 by $122 million and higher education by $64 million.

Together, we've cut welfare rolls in half.

Together, we've added programs to improve health care for elderly and children.

And along the way we fought conditions leading to eight presidential disasters, continual flooding at Devils Lake and a historic flood that left 10 percent of our citizens temporarily homeless.

Most importantly, ALL of this has been accomplished without a general tax increase. And do you know why?

Because North Dakotans have held firm to fundamental principles: That business, not government, creates jobs. And economic growth, not tax increases, creates the revenues to support government.

Today, North Dakota is poised to realize the vast opportunities the technology revolution is affording every willing participant in the world. I refuse to accept the negative attitudes of those who are impatient with the challenges that remain.This is not the time to change course. There are no quick fixes or easy solutions. Raising taxes, adding government programs or erecting fences around our state will not keep our children here. Opportunity will!

So, in my final year, I intend to continue building and charting a path for progress in the 21st Century. And I welcome every North Dakotan who believes in this state to join me.

I've decided to take a slightly different approach with this, my Final State of the State speech. In the past, I addressed a wide variety of issues -- agriculture, health care, social services, the environment, transportation.

But this year, I've chosen to focus on the forces of the technological revolution and how they will affect our state.

The world is in a major transition from an economy that was manufacturing-driven to one that is information-based. In fact, the Internet revolution is the most significant economic development of this century. And, like electricity around the turn of the last century, only the tip of the iceberg is in view today.

This transition is the force behind the unprecedented economic growth in our nation, and it is exciting for North Dakota in several ways. First, it feeds into our biggest strength: smart, motivated, hard working people. It eliminates traditional barriers of geography and weather that have plagued North Dakota for much of its history.

And, technology allows us to market our many other benefits to the world, like our people, our clean, open spaces, and our crime and congestion-free communities. If you take these priceless resources and combine them with technological changes occurring in the marketplace, we have a competitive edge in this state that we have never seen before.

Today, I'll propose initiatives to maximize this competitive edge like improving our high-tech infrastructure, creating state-of-the-art classrooms and developing new business opportunities that will secure the future of this special place we call North Dakota.

Much of what I will talk about has clear implications for our state's young people. Their future here is probably the top concern of every public official, parent and grandparent I have met in the last seven years. I have invited high school students to listen to my speech, and explore its themes with their classmates, teachers and parents. I hope my message provokes them to consider their future in North Dakota.

When historians look back on the year 2000, I believe they will see it as the beginning of a technology explosion that changed the world. High tech advances will affect everyone, even those who don't like computers or aren't interested intechnology.

Classrooms will become global.

Genetic engineering will make farms smaller, more specialized and more profitable.

Corporate executives will be as successful in Watford City as on Wall Street.

And when high school students today are at the peak of their careers, they will use computers that communicate with 100 percent natural human language and emotion and are 70 million times more powerful than the one currently sitting on my desk.

The environment of the future will come alive with technology. According to one computer scientist, "Technology in the future will be everywhere, always on, much like electricity."

For people my age, these predictions seem far-fetched, a little unnerving perhaps. But if I were a high school student, I would be bursting with excitement about the possibilities of the future. And I would seek my future in a place thatembraced these possibilities.

North Dakota must take more bold steps to be that place.

North Dakota must preserve our pioneering spirit but shed the trappings of the past that continue to hold us hostage from an exciting new future.

North Dakota must grab eagerly at the unique chance technology gives us to redefine ourselves and come alive with new opportunities.

In the words of one Yale University computer scientist: "We can let the future happen, or take the trouble to imagine it. We can imagine it dark or bright -- and in the long run, that is how it will be."

We've laid a firm foundation for a new North Dakota, but what happens next? Will we continue our course and erect a magnificent structure, or will we abandon our hard work, never to achieve the goal you and I have shared these past seven years? I say we press onward and upward. North Dakota is a magnificent structure in progress. Let's continue to build!

Let's build a state-of-the-art, statewide telecommunication infrastructure.

Let's build education standards that push all young people to excel in the new information-driven economy.

And let's build and apply high-tech solutions to each and every new and existing business in this state.

If we do these things, I believe we can build a future for this state that is as bright as we can imagine, and more.

INFRASTRUCTURE:

Consider for a minute what life was like in North Dakota without electricity, telephones and paved roads... Not a pleasant thought in the middle of January! Investments in power, communication and transportation infrastructure transformed theuntamed North Dakota prairies into livable communities.

Now, imagine what life in North Dakota will be like in the future.

Computers will operate household appliances based on simple voice commands.

Senior citizens will be spared doctor visits through in-home tools that monitor vital signs, check on prescriptions, and communicate with doctors and nurses.

Working parents will order groceries on-line, delivered from local stores to their home.

North Dakotans will take virtual tours of the world's greatest museums without leaving their home.

Entrepreneurs will sell their products and services, and farmers will market their crops worldwide over the Internet.

Young people will attend Super Bowls or live rock concerts that are beamed in to a local event center with technology that rivals being there in person.

And finally, we'll be able to program our VCRs.

The delivery of health care, education, commerce and culture are many of the biggest challenges in North Dakota today. And technology is rapidly providing practical, affordable solutions to these challenges. It can be a savior to rural areas like North Dakota.

The key to making all of this possible is infrastructure.

Investments in modern infrastructure are just as important to our state today as roads and electrical lines were yesterday. I've said many times that the Internet is the railroad of the future for North Dakota. We must ensure that it has tracks all over our state.

Within the next 12 months, we will create a high-speed, high-capacity telecommunications backbone that provides voice, data and video capacity throughout our state at a low cost. This backbone is critical to building the dynamic economy andculture we all desire.

It will connect all the students listening today to each other, to our universities, libraries and the World Wide Web. It will connect their parents to more convenient government services from city, county and state agencies. It will connect theirgrandparents to the best medical resources in the state and nation.

But we cannot stop there. We must also build capacity to serve the private sector, so North Dakota businesses -- from Main Street merchants to software developers -- can benefit from high-tech innovations.

When it is done, people in Trenton and Tioga will have the same high-tech capacities as people in Fargo or Minneapolis.

We are well on our way to achieving this. The Legislature took the first step last session by approving a plan to lay a network of high-tech tracks all over North Dakota. And last fall, I hired our state's first Chief Information Officer, Curt Wolfe.

Curt's top priority is overseeing the creation of our state's high-tech backbone. The project demands extensive cooperation from the private sector. We are currently negotiating with service providers to connect as many of our state's 361 communities to this state-of-the-art telecommunication network as possible.

By next year at this time, I fully expect this network to be complete. And it will be an enormous step in helping communities come alive with new business, education and cultural opportunities.

EDUCATION:

I am very proud of the significant funding increases this administration has directed to K-12 and higher education in the last four budget cycles. But I have been frustrated by our slow progress in other areas, such as challenging students to higher achievement, improving teacher salaries, and rewarding excellence in teaching.

Proposals to address these goals have become mired in political battles and turf protection.

Lt. Gov. Rosemarie Myrdal and her nonpartisan Quality Schools Committee are leading a final push to try to break the stalemate. The committee is developing realistic and progressive policy recommendations to improve education. And I will use these in preparing my final executive budget.

A top priority for this committee is meaningful suggestions for making North Dakota a leader in high-tech teaching.

There are many compelling reasons to aim high when it comes to e-learning:

Technology can enrich the teaching of many subjects such as science, math and languages.

Technology allows schools to share resources and expand curriculum.

And, most importantly, our youth need high-tech skills to support high quality careers regardless of their profession. Technology skills join reading, writing and arithmetic as important education basics. Businesses hire people, but what theypay for are skills that meet their current and projected work needs.

Listen to these comments from Dennis Johnson, president of TMI Systems Design Corp., an institutional furniture maker in Dickinson. "Despite conventional wisdom, TMI has grown and prospered at its Dickinson location. Why? Because TMI in the past has had access to a quality workforce. But I am not as confident about the quality of the workforce of the future, because what was quality yesterday will be average tomorrow. There are shortages of people with technology skills today."

In the last decade, the state has invested nearly $30 million in K-12 technology equipment. Our schools are fourth in the nation in student-to-computer ratios, and eighth in students per Internet connection. But putting computers in classrooms and connecting our schools is meaningless if the technology is just a tool for typing assignments or surfing the Net.

The real urgency is training teachers to maximize these computer resources and totally rethink the classroom approach.

North Dakota teachers receive just five hours of training annually on how to integrate technology into the classroom. A state project called Teaching with Technology is changing that. It gives all North Dakota teachers the opportunity to triple these hours and receive a cash bonus in the end. It's a great program - one we must enhance.

Maybe we should add technology training days to the school calendar, provide stipends to entice teachers to seek training on their own, or create technology standards for teachers. I'm asking the Quality Schools Committee to develop e-learninginitiatives like these that will be a priority in my budget recommendations.

I also challenge the University System to make North Dakota institutions leaders in modernizing teacher-training programs.

The bottom line is teachers must have cutting-edge skills to create high-tech classrooms. We must equip them to dissect virtual frogs, to let students studying Spanish talk to high schoolers in Mexico via interactive video, to conduct recitals with music students from five different rural schools, or teach civics using the original founding documents in the Library of Congress.

Our schools must come alive with technology so our students continue to graduate at the top of their national class, equipped to lead exciting new information-age industries in our state.

ECONOMIC DEVELOPMENT:

For my remaining minutes, I want to discuss economic development in the information age - the new doors it opens for job opportunities and the impact technology will have on traditional businesses that are already here.

Listen to these important facts about the affects technology is having on the economy. Over the last five years, gains in productivity for technology manufacturing have increased up to 30 percent per year, while the comparable figure for non-high tech manufacturing was just 2.5 percent.

Ultimately, this gap in productivity means two things: more jobs and more money. In fact people in high-tech areas are making considerably more money in wages and benefits. Since 1994, real wages have risen 11 percent in the new high-tech economy, but only 3 percent in the old. Technology-related jobs are growing twice as fast as non-technology areas.

And consider North Dakota where our growing and dynamic industries employ 20 percent of the workforce but contribute 35 percent of our gross state product. These industries are already contributing more to our economy than their employment numbers would suggest.

If you tour our state, you will see that many communities are realizing the benefits of information-based businesses:

Williston, Dickinson, Linton, Jamestown and Fargo have hundreds of new jobs with Rosenbluth International; there are 80 jobs with Medical Arts Press in Ray; 1,000 jobs in Minot with Reliastar, Choice Hotels and MLT; 200 jobs for Rugby and Devils Lake at the Connection; nearly 300 new jobs in Oakes; TechLink in Ashley; and up to 200 new jobs in Watford City in a promising new industry, remote software development.

High-tech innovations are also helping many existing North Dakota businesses add competitive muscle. Take agriculture for example. Farmer owners of the Dakota Growers Pasta Cooperative, using state-of-the-art milling equipment, averaged $6.64 per bushel in 1998, while durum was selling at $3 on the open market.

This fall, some North Dakota producers planted "dormant" canola using a seed that is covered with a high-tech coating that breaks down with time and temperature. The seed sprouts earlier in the spring, giving the canola plant a jump on weeds and heat in order to increase yields.

Or look at the transformation of Nordic Needle in Fargo. What started as a tiny local craft and needlework shop is a booming on-line company that sells needlework supplies and kits throughout the world. Much of this made possible by the Internet.

Successful communities and businesses today have a couple things in common: They aren't paralyzed by blaming their decline on factors beyond their control. They aren't waiting for someone else to solve their problems. They aren't afraid to form partnerships with former rivals. And, most importantly, they have innovative leaders who embrace nontraditional thinking.

I had a very interesting meeting with one such business just last week. Imation of Wahpeton manufactures floppy disks. In fact, it produces more than a million of these diskettes every day.

Imation recently fought off global competition for its product through a competitive edge gained by being in North Dakota. Their team of 50 engineers who work at this plant created technological innovations that were able to save 6 tenths of 1 percent of one penny on the price of this diskette.

And that made the difference. High-tech solutions engineered by quality North Dakota employees kept Imation globally competitive and secured 600 good jobs in this state. The company even recently recruited a Ph.D.-educated North Dakotanback home to join their team.

Some people listening to this speech who aspire to prosperity in traditional business might not see a place in the world I'm describing. I have one bit of advice for anyone who thinks the technology revolution doesn't affect you: think again.

As management guru Tom Peters says, "If you aren't getting better faster than the other guy, you're getting worse."

And this applies to every North Dakotan, from farmers and flowershop owners to doctors, lawyers, teachers, teenagers and truck drivers. It applies to state government where exciting e-commerce projects are saving money and simplifying services. It even applies to grandparents, many of whom already go on-line to communicate with grand kids, trace family lineage or manage investments.

My point is this: All North Dakota individuals, organizations and companies must get tech-ready.

There are no barriers of age, sex, color or location to the fortunes that can and will be made in this information revolution. Individuals everywhere are finding these fortunes. Our challenge is to cultivate these folks right here in North Dakota - and give them the chance to succeed.

And I see several roles government can play:

Creating the statewide technology infrastructure and educating students with high-tech skills are two important steps.

We must also get more aggressive in growing entrepreneurs. The University of Mary has launched a program to do just that. It aims to teach young people how to be leaders and innovators in our communities. Students in this program are in the audience today. I know they're listening with critical ears -- their average GPA is 3.7!

And in regard to the new entrepreneurial degree at UND I have just one comment: AWESOME! I give the university a standing ovation for listening to the demands of businesses and students. This is a perfect example of how higher education can be a driving force behind economic development in North Dakota.

And finally, the state must aggressively support new industries with creative financial, tax and regulatory policies that attract and keep them here.

To this end, I am turning to the private sector for input. The North Dakota Information Technology Council is exploring initiatives the state should pursue to advance IT industries in our state. Again, these measures will find a prominent role inmy budget recommendations, and I look forward to their work.

We must take all these steps and more to create a culture that pushes talented people toward prosperity. We must leverage the tools of technology to help our communities and businesses come alive with new opportunities.

For the past several years, I have prepared for the State of the State speech with a walk around the Capitol grounds. I have reported to you the things I've seen, felt and focused on during this now traditional walk: our Indian heritage, our pioneers, our veterans and our children. I've talked about opportunity, hope and working hand-in-hand to create a brighter and better future for North Dakota.

As you can imagine, last night, as I made this walk once again preparing for my last State of the State address, I was more reflective than usual. Where have we been, where are we and where are we going?

I enjoyed our beautiful Capitol grounds on a quiet, crisp night, and I tried to imagine what monuments, what presentations would be built here in the future to honor what we are accomplishing today. I thought of the changes that the last century brought: electricity, phones, the assembly line, the typewriter, airplanes, movies, computers and floppy disks.

I tried to imagine the future, one that seems incomprehensible to us now. Communication between man and machine alike with no skill or language barriers. Unlimited job opportunities with no location requirements. Education and trainingsystems that will produce workers for jobs not even envisioned. The bionic man will be with us and the value of brain power will reach unprecedented heights.

It is hard to imagine how we are going to prepare for and accept this in our lives.

I do know that change is scary. It is difficult. But change we will. Pioneers, like in the past, will lead us to new lives in the future, and new horizons will lay before us.

Someone asked me recently what I would miss about this job. I think I'm going to miss the view. As governor, I've seen the past and how it effects our lives today. I've seen the ability of our people, felt their passions and kindness, and observed their commitment.

I've imagined our future: A state bustling with new jobs and new wealth. A clean, safe place nurturing seniors and encouraging youngsters. A work ethic, moral courage and sense of community that produces the best workforce in the world to take advantage of the technological revolutions that are rapidly approaching.

And the view that I have has generated in me a strong belief. I truly believe that our state can grow and prosper. But, we must now take the steps to ensure our destiny. Use technology to connect our people with healthcare, education and commerce. Use technology to produce high-value crops and products. Use technology to compete on the global scale that surrounds us today.

This, my friends, will be every bit as powerful tomorrow as that railroad of yesterday. And, if we fail to seize this opportunity, we have only ourselves to blame.

Imagine with me our future. It will be hard, for sure. Full of challenges requiring solutions never before imagined. But I know North Dakotans, and I have absolutely no doubt that working together we will make sure our future is not just wildimagination, but a realistic dream. Let's make it come alive!

I'd like to close with a passage of scripture. This is from Galatians, chapter six, verse nine, "Let us not grow weary indoing what is right, for we all will reap at harvest time if we do not give up."

My fellow citizens of North Dakota. Imagine with me this incredible future for our state. Struggle with me over the difficulties and challenges. Work with me to bring it to reality. And celebrate with me our victory.

My friends, let's go now. We have a train to catch. It's the e-train. Climb aboard. I know we can make it happen!

Thank you and God bless you.