california governor jerry brown delivered his state of the state address before a joint session in california legislature in sacramento. e outlined his goals for the states that includes investment in infrastructure and health services. this is 20 minutes. and allow four term governors to seek a final term. [applause]

gov. brown: it is a light note. back then, california was amazingly dynamic and it still is. those who live here know this land as unique place which draws people from every part of the world because of the tolerance, creativity and sheer openness. there is much to be thankful for. we live today in a world that is profoundly uncertain. what happens far away can touch us directly. a slowdown in china or turmoil in iraq or syria or anywhere can send the stock market reeling input california jobs in state evenues in jeopardy. and the battles far away sometimes comes right to our soil is the

unprovoked and brutal attack in san bernardino. what occurs daily consummate parts of the world could occur here. that is what we have to be prepared and vigilant. i wish that was not the case, but it is. at the state capital, we think we have more control over things that we actually do. the global events and policies set the pace and shape the world we live in. the challenge is to solve today's problems without making those of tomorrow even worse. we face a future that is partly determined, and yet in many ways unknown. our job is to face the fact that we do now and prepare for the many unknowns as best as we can. in that spirit, you are not going to hear me talk about new programs today. i'm going to focus on how we pay for the commitments we already have. the budget, let's start with the budget. since the second world war, we

have experienced 10 recessions. economists are unable to pinpoint when a recession will begin or how long it will last. historically, california's budgets have been built around forecast that assume uninterrupted growth. just looking at the last two recessions, we noticed that ongoing state spending accelerated into the ownturn. that's why if you add up the in the and surpluses year 2000 to 2015, you find the total deficits for several times as large as the surplus, resulting in painful and unplanned cuts. schools, child care, courts, social services and other state programs were deeply affected. so were our universities, we had to reduce classes and double tuition. i do not want to make those istakes again.

the next recession will cut our revenues by $55 billion over three years. that is why it is imperative to build up the rainy day fund, which was just recently approved by the voters and invest our temporary surpluses into badly needed infrastructure. or in other ways that will not lock in future spending. let us also be realistic of our current tax system. california is a very progressive, but volatile income tax that provides 70% of general fund revenues. if we were to minimize the zig-zag of spend, cut,spend, we must build a very large reserve. we also know that inequality has risen sharply in recent decades. we have seen the disappearance of many lower-class dobbs and the growing share of income taken by the top 1%. even more so by the top 0.1%

this contrast sharply with the virtual stagnation in the -- the average worker pays 360 times. such inequality is reinforced by a national, regulatory, and tax policies and driven by globalization and relentless influx of cheaper goods at outsourcing of higher-paying jobs. technological change also plays its part. sophisticated software, robotics, and global communication. of course, this creates jobs and makes available phenomenal amounts of information, but it also makes for higher -- a huge number of low-paying service jobs.

california has not been passive. we have expanded many programs to counteract these powerful trends. we raised the minimum wage. we are now the first income tax credit -- we strengthened strong prevailing wage laws. we made sure that 6.5 million workers will be paid for sick leave. for low income students, would provide over $2 billion in pell grants and we paid the 60,000 nt fees for college students. in may, we will start providing full health care coverage of the children of undocumented workers. [applause] gov. brown: most importantly, this is truly monumental, we

wholeheartedly embrace the affordable care act. [applause] gov. brown: as a result, we are now enrolling 13.5 million californians at another 1.5 million and covered california. this is a historic achievement that will provide health security to so many who have not otherwise afford it. another area where we are leading the nation is how we provide health services to people in their own homes and in the process give jobs to their providers. over the past two years, we have expanded this and home service program by serving more recipients in giving current s more hours of care

and giving overtime pay to those workers who provide those services. [applause] gov. brown: while these programs are enormous, so is the ost. in four years, total medi-cal ost are growing by $23 billion it is a state begins to pay for each year of the millions of new enrollees, the cost of the fund will also rise. in 2012, the general fund paid $15 billion for medi-cal. by 2019, that number is expected to be $25 billion, an increase f 2/3. for in-home supported services, in just two years, total spending will jump by $2 billion in 20% increase. as the economy reaches a turn point, it is crucial to plan for these increased costs. i ask you, republicans and democrats, to seriously consider the newly revised financing reform.

other states have taken advantage of this federal program in california should not shortchanged itself. this is not a tax increase, no matter what anyone tells you. arithmetic is simple. california comes out a clear winner. please, give it your consideration. [applause] gov. brown: do i detect a few republicans shaking hands? i hope so. [laughter] gov. brown: the strong economic recovery in the passage of proposition 30 has allowed us to increase spending in public schools and community college to $47.3 billion in 2011 to $71.63 billion this year. that is a 51% increase in overall spending -- with significant sums allocated out of a local control formula

to provide for the unique challenges that face low income students, english learners, and those in foster care. this pattern of educational spending reverses the historic practice of assuming that all students encounter similar circumstances. they do not. the local control formula now in its fourth year recognizes this fact with extra funding to enable educators to overcome the barriers that confront non-english speaking families and those with low incomes. i am proud of how california has led the country in a way that is returning control to local school districts. the last two decades, it has been a national movement to micromanage teachers from afar. to increasingly minute and prescriptive state and federal regulations. california has successfully fought that movement and has now changed its overly intrusive

test heavy state control to a true system of local accountability. we also know that the state has made other commitments. once we have yet to fully pay for. our retirement liabilities and lifelong health benefits for state and university workers otal $220 billion. each year, the budget must allocate billions to slowly chip away at these obligations. we have taken steps to reduce the future costs of these pensions and put the teacher system back on its solid fiscal building. -- footing. still we have more to do. today, we have set aside a total amount to pay for 72 billion of future retiree health benefits. these liabilities are so massive, that ignoring them will not allow us to pay them off. in a year or two or even in 10.

this little sex fashion and emotion of chipping away with an obligation of three decades to pay for something that is already been promised. yet it is our moral obligation to do so, particularly before we make new commitments. we have failed to a knowledge -- acknowledge that they will unfairly burden future generations of californians with these debts. another obligation we have to face is our deteriorating nfrastructure. levees and facilities and our parks, prisons and state hospitals, serious deficiencies abound. i proposal to use $10 billion to repair and replace aging tructures. eglecting what we have built

over many years and letting it further deteriorate makes no sense. our overall statements -- maintenance estimates $70 billion. most of that is in our roads, highways and brings. here is our challenge. we have no choice but to maintain our transportation infrastructure. yet, doing so without an expanding and permanent revenue source is impossible. that means, at some point, soother -- sooner rather than later, we have to bite the bullet and create new fees for his purpose. idology and politics stand in the way but one way or another, the roads must be fixed. [applause] on the bright side, the joint together of both parties to

secure passage of proposition 1. [applause] with our california water action plan, it establishes a solid program to deal with the drought and longer-term challenge of using our water wisely. our goal must be to preserve alifornia's natural beauty and our re a vibrant economy on farms, cities, and for all the people who live here. a series of actions must be taken. we have to recharge our aquifers, recycle, capture storm water, build storage and reliable conveyance, and just -- invest in new technology. all the while, recognizing that there are limits. achieving balance between all of the conflicting entries is not

easy. i pledge to you that i will listen and were patiently to achieve results. [applause] gov. brown: water goes to the heart of what california is and what it has been over centuries. putting fish against farmer misses the point and distorts reality. every one of us and creature that dwells here forms a complex system that must be understood and respected. besides the immediacy of drought, there is the overarching threat of a warming climate. incredibly, though last year was the hottest on record. there are still those, particularly in washington who are in denial. even the deniers can't deny that

carbon pollution that exists all over the world is causing serious injury and respiratory diseases to people of all ages, especially the young and very old. thankfully, the rest of the world has heard the message. humankind must change the ways and radically be carbon eyes -- de-carbonize the environment. - economy. the paris agreement was a breakthrough. california was there leading the way. [applause] gov. brown: over 100 states have now signed to our mo2mou. the goal is to bring capital greenhouse gases to two tons per person. that will take decades, but we are on our way. [applause]

gov. brown: we know that disasters happen. fires, floods, earthquakes, they will occur and we must prepare o respond. that, too, requires maintaining a solid reserve. this morning, i talked about the difficulties that lie ahead. let us not forget how far we have come. in 2011, the state deficit was $27 billion. our credit rating was the worst in the nation. unemployment was 12%. now, the budget is in surplus. [applause] >> standard and poor's has raised our credit rating three times. [applause] gov. brown: we paid down accumulated debt, $26 billion worth. [applause] ov. brown: you should apply,

-- applaud because there may not be too much coming after this. [laughter] gov. brown: we created funds to offset the next economic downturn. [applause] gov. brown: we have increased unding for schools by 51%. we are covered under medi-cal, 13.5 million people and a 74% ncrease. for first time an earned income tax credit. we raised our minimum wage to $10 an hour and that is 80% higher than the same minimum. 2 million new jobs have been created and unemployment has

dropped in half. the global recovery has a lot to do with that. we should applaud, but we cannot control good health. it is clear that california is still the great exception. we care to do what others only dream of. -- dare to do what others only dream of. difficulties remain and they always well, that is the human condition. finding the right path forward -- we will find it as we have in the past and as we have done so again with courage and confidence. thank you. [applause] >> the u.s. conference of mayors winter meeting continues on friday. live at 9:30 a.m. eastern on -span 2. ook tv has 48 hours of non

fiction books and authors. here are some problems to watch for this weekend. saturday night, charlie argues that president obama who came into office saying he turned back the acceptance of the bush administration has picked up where president bush left off in his book. then at 10:00 p.m. on afterwards, former senate leaders tom daschle and trent lott on their book, crisis point. recommendations for moving america forward. they are intered by j.c. watts of oklahoma. >> just the incredible demand for more and more money is one of the issues that really is exacerbating all of this and make it harder for the leaders to bring people together. first they are not in town testimony secondly they are doing all of