Editor’s note: This interview was conducted on Tuesday, May 14, just as the budget negotiations for the session began heating up.

TM: When we sat down to talk in February, you identified some of the issues you thought were of greatest importance to the Legislature: public education, water, and transportation, among a couple of other things. We now have fewer than two weeks to go in the session, so I wonder if you would take a look at those issues and give us a window on where you think we are—or if we’re going anywhere?

Governor Ratliff: Well I think you’re going to see some pretty serious bills coming out on public ed, and they’re going to make some changes to charter schools. I think not nearly as drastic as the author wanted to start with, but I think they are going to clean that up. I think they’re going to reduce the amount of testing required under the accountability system, which I think is wise. I think we’re far over-testing. Of course, unfortunately I don’t think we’re going to get nearly as much money for public ed as we should be getting. I mean, they’re celebrating the fact that there might be as much as $3.5 billion, but if you consider the fact that it takes $1.2 billion just to stay up with enrollment and inflation, that doesn’t get us very close to any kind of recovery from the kind of cuts we’ve had over the last four years. That’s unfortunate.

TM: Initially the House and Senate were about $1 billion apart in their totals, but today we’re hearing signs that they might settle on a figure just above $3 billion.

Ratliff: You know, typically conference committees strike something in between, but neither number is anything to be proud of.

TM: You had mentioned testing as well. HB 5 takes the number of end-of-course exams down from fifteen to five, but some people have raised concerns about rigor now that the requirements for graduation have been reworked. Does that worry you?

Ratliff: I think it’s unfortunate that we have people who are critical of allowing a pathway for students who don’t feel inclined to go on to university. Right now what we have now is two tracks: We have the university track, and we have the dropout track. We’ve got to fix the dropout track. What we have to do is create some kind of curriculum that these kids can relate to that helps them make a living in the future. And you can’t give them that curriculum and then require them to take the tests that you’re requiring of university-bound students. That doesn’t make any sense. So I don’t buy the accusation that we’re reducing rigor. What I think we’re trying to do is to design the accountability system where it measures what the kids need to know based on they type of curriculum they are interested in.

TM: I know you’ve done some work for Raise Your Hand Texas. Is that group comfortable with the bill?

Ratliff: I don’t speak for them, but I understand that they’ve worked on it very hard and they feel like it’s a very good bill.

TM: Speaker Laney, let me turn to you on education.

Speaker Laney: I think that Governor Ratliff is correct on the two pathways he mentioned. The problem is that we’ve got too much stuff that’s required and not enough things that allow the student to pick their classes and electives. This gives the student a little more flexibility rather than having to take all these required courses. The Legislature has been guilty of saying, “You’ve got to take this, you’ve got to do that.”

TM: So building more flexibility into the curriculum is a good thing?

Laney: Well, I think it is, along with allowing the testing to be actually on material the students should have learned. Of course, as Governor Ratliff said, there’s the expansion of the charter schools and things like that are probably the big losers this time.

TM: Once again.

Laney: Once again.

Ratliff: And I think that is probably justified. Because in the same bill talking about how many more we’re going to allow, they are at least attempting to crack down on bad charter schools. We have one charter school that for seven years has been rated unacceptable. Well, why do we allow that to continue? So as part of the trade-off, yeah we’ll let you have some more, but we want you to crack down on poor charter schools. If we’re going to send state dollars to charter schools, they need to be good charter schools.

Laney: I think part of the problem is some of those charter schools were investments. They weren’t school systems. They were investments for individuals and profit centers. The sad part about what’s happening is that only half the cuts are being restored. It’s been said that we’ve got a thousand people a day coming to Texas, but when you take a several billion-dollar cut, restore only half of it, and then say we’re funding public education, it’s kind of a misnomer. Public education is what made this state great. And I think that’s part of the infrastructure that has made it great, just like highways. Public education is probably the most prevalent of those.

Ratliff: And to paraphrase Judge John Dietz, “You cannot continue to raise standards while starving the school system of funds.”

TM: You can’t have it both ways.

Ratliff: You can’t. It just doesn’t work.

TM: Let’s turn to water. In my mind, everything was going pretty smoothly in the House this session until about two weeks ago last Monday, when HB 11 came up. Representative Allan Ritter had already passed HB 4, but HB 11, which would have provided the funding, went down on a point of order. The Senate has passed a joint resolution, which would ask the voters to approve drawing down $5.7 billion from the Rainy Day Fund to address water, roads, and education, but the House hasn’t been interested in leaving that decision up to the voters. Did you think we might be farther down the path right now on such a critical issue? Or do you think that there is still time in the session to strike a compromise?

Laney: You’ve got two different things happening. You’ve got the business leaders saying we’ve got to have water, just like transportation. We can’t keep growing our infrastructure without adequate water supply because that’s a necessity, just like highways are. But then you’ve got some of the same supporters of that saying yes, we can do that, but we’re not going to touch the Rainy Day Fund and we’re not going to raise taxes. So you’ve got a problem, because it’s some of the same philosophy on both sides of that issue, and you can’t have it both ways.

TM: Will they be able to break that logjam?

Laney: I don’t know what kind of communication the two sides are having. Governor Ratliff and I communicate very well [laughs]. And we both were very honest with each other about what our respective chambers were doing and thinking. And we had some very good people working with us that were very positive for the state of Texas, so we were able to solve a lot of problems.

Ratliff: As far as the time that’s left to pass some of this major legislation, ten or fifteen years ago you could go right up to the last day and have some major legislation go through both houses. The rules don’t allow you to do that anymore, so you really have about a week. And that’s a pretty short fuse for a major piece of legislation. Frankly, I’m very surprised. Since the governor had in the past resisted so strongly using the Rainy Day Fund, the fact that he came out in favor of it but wasn’t able to carry the day surprises me. And I guess I might, if I were a betting man, predict that either or both of those issues will require a special session, because it seems to me that if you’re the governor and you have put something that strongly on the table to be acted on, and it’s not acted on, that’s pretty good ammunition for a special session.

TM: Let the record show that it took less than fifteen minutes for the words “special session” to be mentioned!

Laney: Governor Perry probably has made that pretty prevalent in his conversations, that without water and without transportation, he would not be bashful about calling them right back into session. Now, I don’t know what other motives he has…

TM: And tax relief.

Laney: That’s right, and I don’t know whether they’re going to file the tax cut.

TM: Let’s dial in on transportation a bit. In our interview in February, Governor Ratliff, you had said that in 1991 you were the only Republican senator to vote for an increase in the gas tax. But you had never had a single person in your district ask you about why you had taken that vote. In fact, you had said that your constituents knew that we needed roads, and they knew that it costs money to build roads. But last week in the House, Representative Drew Darby’s HB 3664, which would have increased the vehicle registration fee by $30, went nowhere. He pulled it down, even though the fee hadn’t been raised since 1985, and even though he accepted an amendment by Larry Phillips that cut the proposed fee in half. So is there a way to solve the issue? What happens next?

Ratliff: I think you live through eight, maybe ten years of deteriorating highways, of much increased congestion, of no new highways, no new lane miles, and increased citizen frustration with the fact that they can’t get anywhere. How are we going to build these roads? It’s going to have to get worse before it gets better.

Laney: And Representative Darby is in a position to know about what’s happening to deteriorating highways because he’s from an area that has these oil field trucks, and those roads weren’t built for that kind of traffic. Ordinary wear and tear is bad enough, but the traffic is just phenomenal.

Ratliff: You can solve that partially in the urban areas, but out in West Texas, you’re not going to build toll roads. There is no option for toll roads out there. It’s an option of either the gas tax or registration tax or nothing.

Laney: And we’re maxed out on bonds. The problem is, at least in rural areas, when the city guys go to Colorado or New Mexico or Louisiana, they have to go through our country. So those roads need to be in pretty good shape for people to come through them, and to stop to fill up with gas. But the more they’re torn up… the more alternate routes they’re going to find, which will just throw more congestion in other areas. And back to the idea that a thousand people a day are coming to Texas–I bet nine hundred of them have cars! [Laughs] When Governor Ratliff and I were a lot younger, the comments were, “Oh, I don’t want to go to Oklahoma. I don’t want to have to drive on those roads.” Now people are saying, “Oh, I’m glad to get to Oklahoma so I can drive on a decent road.”

TM: So your sense is that we have a high chance that we would have a special session to solve some of these issues, that we’re running out of time.

Ratliff: Yep, but in the case of transportation and water, not only do both houses have to vote to use the Rainy Day Fund, it’s my understanding that they’re going to have to vote to lift the cap. I think they’ve got a huge challenge in front of them getting anything through in either case.

Laney: Speaker Straus is very optimistic about finding a decision on water. I don’t know what he’s looking at, but he’s very optimistic. I think the transportation problem is, as Governor Ratliff said, going to take a little longer for people to realize what kind of condition they are in.

Ratliff: Unfortunately, legislative bodies—particularly this legislative body—won’t take action until you have a crisis.

Laney: They react instead of act.

Ratliff: They react to crisis, whether it’s transportation, or water, or education. The courts had to force us to build prisons some years ago, and courts had to force us to have equity and adequacy in schools. And the roads are going to have to fall apart, and we’re going to be rationing water, at least in the metropolitan areas, before people wake up and realize that…

Laney: But when they do, they will. Either they’ll fix it or they’ll be replaced with somebody that will fix it.

TM: Given that so much remains up in the air, are there any bright spots you can point to that the 83rd Legislature has accomplished?

Ratliff: I guess the major ones still are out there. They sort of overpower the rest.

Laney: No, and some of the agendas that are probably winning may not be the more positive ones. Like payday lending, for instance, that’s a real hot issue, and the payday lenders look like they’ve won! And on the losing side, probably Medicaid is gone, and of course the one that didn’t even get started is the casino gambling.

Ratliff: And you almost lost the lottery! [Laughter] Of course, I have never been a fan of the lottery, but the interesting thing to me was that those members, the ones that voted against the sunset bill, were being told that the billion dollars was coming directly out of education. Well, that’s silly! You could put a billion from somewhere else in education; it doesn’t come directly out of education any more than it goes directly into education. To this day, if I make public speeches in my district to anybody who has anything to do with education, I still get the question, “What happened to the lottery money? Why didn’t that solve all of our education problems?”

Laney: And when the lottery originally happened, education wasn’t the recipient of any money. Bullock kept getting so much heat about it, he said, “Okay, let’s just say it is!” When you’re putting $1 billion into a $17 billion pot…

Ratliff: And then you put that $1 billion in that pot and then you take another billion out and put it somewhere else! It’s just moving money around.

Laney: It’s just a bookkeeping deal.

TM: With the time that we have left, I’d like to ask you to look specifically at your chambers. As I noted in our previous interview, Speaker Laney, you had served exclusively in the House, Governor Ratliff, you had served exclusively in the Senate. Can you size up what has happened in the House and Senate?

Laney: There’s probably been more activism of the newer members.

TM: Forty-two freshmen in the House.

Laney: And they are much more active than they even were when I came in a there were 76 of them. There’s a lot more proactive involvement on the microphone, and some of them may be able to be quoted in campaigns! [Laughter]

TM: Nice way to put it.

Ratliff: Some of them are hoping to be quoted in a campaign!

Laney: I think Speaker Straus has tried to let the members have their say. And we’ll see at the end of the session if that’s been positive or not, but I think it has been as far as letting the members participate. I think that I’ve seen more lobby activity in the legislative process on the House side. Now, whether it’s affecting anything or not, I don’t know, but the lobbyists have been a lot busier this session than I have seen them in the past.

Ratliff: I don’t know how there can be any more lobbyists.

Laney: Now, I didn’t say more! But, yeah, you can’t get a seat in the cafeteria.

Ratliff: They are going to have to expand the cafeteria.

Laney: But before we built the extension, we had the one little hallway downstairs. Everybody else had to go somewhere else to do their lobbying.

TM: Governor Ratliff, what’s your sense of the Senate?

Ratliff: I have to preface it by saying I really haven’t watched it closely. I read news accounts, and every now and then I’ll watch the debate on a bill that I’m tracking. But after being there for so long as a member it’s kind of like watching paint dry. You nod off. It seems to me that this time two years ago, you had the Senate almost in open rebellion. They were really having a rough session. I don’t see that happening this time. I think it has once or twice, primarily on the education bill, but I guess I’d have to say it has either been less controversial or they’re just getting along better.

TM: Is that a function of Lieutenant Governor Dewhurst’s leadership this session? Or is it a function of the makeup of the Senate?

Ratliff: If I had to guess, it’s a function of the fact that they haven’t really had any major legislation to fight over. Education is really the only thing that came through. They fought pretty seriously over vouchers, and finally just killed it. And I think that’s the one where they had to go into caucus a couple of times to try to calm them down. Other than that, I don’t know that they’ve had anything to fight about.

Laney: And you’ve got some senators who were freshman last time but have moderated their activity a little bit.

TM: Their tactics are different.

Laney: Their tactics. They’ve figured out that…

Ratliff: You don’t get anywhere by throwing bombs.

Laney: Honey’s better than vinegar to attract flies.

TM: We have not talked in great deal about Governor Perry, but I wonder how you would size up his leadership this session.

Laney: I think it’s hard to judge because he hadn’t been that involved until recently. I think the change in his position on the Rainy Day Fund has been very noticeable, but I think that we’ll just have to wait and see what he does. If something happens here in the next day or two, where you’ve got only a few days left in the session, he’s got a veto problem.

Ratliff: I’m not privy to how many quiet sessions he’s had with the legislative leadership, whether he may sort of be reverting back to the way some prior governors, George W. in particular, have done it where you don’t do these things out in the open. You very quietly call in one or two members of the leadership, and you sit around and talk it out.

Laney: Mark White and Bill Clements would do the same thing.

Ratliff: You don’t call a press conference, and you don’t announce what it is that you’re doing.

Ratliff: We just recently had a House member working his bill on the floor, and he was trying to get votes, and he finally just pulled it down. The governor had expressed concerns about it, and therefore he couldn’t pass it. What that tells me is that Perry may be doing some backdoor diplomacy.

TM: I think that was HB 3664.

Ratliff: Yes, I think that’s right.

TM: Representative George Lavender, from Texarkana, went to the back mic, and there was a sharp exchange between him and Darby. Lavender was saying that the governor was going to veto this bill if it passed. Darby fired back saying the members are not here as a rubber stamp, they’re here to represent their constituents. Ultimately, the bill was pulled down.

Laney: And Mr. Darby’s comments were evident that he was making the decisions and not the Governor.

TM: Certainly wanting to for sure. Is it too early to rate the Legislature?

Ratliff: Yeah… you’ve got another week.

Laney: But you’ve also got another three months to figure out what some of these bills actually did. Especially some of these bills that have not been vetted very well, and there’ll be a lot of members who go back home and say, “Did I vote for that?”

TM: Particularly when they hear it in the campaign!

Laney: Well, they won’t have to wait for a campaign. There will be plenty of things for you guys to write about. There’ll be some things in these bills that nobody knew, but some lawyer drafted it.

Ratliff: And you and I know that we both signed those bills.

TM: Last question, but I can’t let you leave with out playing everyone’s favorite parlor game at the Capitol. What does the future hold for Rick Perry, and what will the primaries look like in 2014?

Laney: I don’t think even the individuals know what they’re going to do until after this session, until after they get a reaction and their political consultants go out and take some polls. It’s like the Public Policy Polling group that pulled Governor Perry off its presidential poll and put Ted Cruz on it. Who’d have thought that a year ago?

TM: You’re referring to the fact that they pulled Perry because was consistently polling at 2 percent or lower?

Laney: And I also think that you have all of these different possibilities: of the lieutenant governor running for governor or lieutenant governor running for re-election, or the attorney general running for governor. It’s evident that Patterson and Staples both are definitely running for lieutenant governor. And the more you hear that, the more likely there’s going to be a senator or two who has a four-year term who says, “I should throw my hat in that ring.”

Ratliff: Get a free shot.

Laney: I can get a free shot. You’ve got some people who have already announced, though you haven’t heard anything from the Democratic side. Still, it’s very easy to see how one of these statewide races is going to have eight or ten people in it.

Ratliff: You’ve also got to throw John Cornyn into that mix. My perception of Cornyn is that he’s cozying up to Cruz. He saw what happened to David Dewhurst, and he seems like he’s a “me too” vote right now.

TM: Your sense being that he could draw a credible primary opponent to his right.

Ratliff: Right.

Laney: I think you’ve got political consultants working overtime analyzing that.

TM: Interesting that you should say that about the two- and four-year terms because that had been a lot of talk on the Democratic side as to whether Senator Wendy Davis would try to take a shot at governor, but she drew a two-year term.

Ratliff: She didn’t get a free shot. What you’ve got is a game of musical chairs where you’ve got eight offices and twelve people going around the room trying to see where they land! And they all have to jump for a seat.

Laney: And you’ve got a lot of individuals who have been waiting in line, which Ted Cruz messed up for them. Some of them are not going to want to wait around now. They’re going to involve themselves.

Ratliff: Of course, the Democrats are sitting back and watching, at least predicting, I think, that the right wing is finally going to self-destruct. They’re going to drive the Republican primaries so far to the right that there will be some Democrats who can sneak in. I’d say that’s going to happen, we just don’t know when.

Laney: And it’s only going to take one, kind of like Governor Clements.

Ratliff: Part of the problem for the Democrats is that they don’t have much bench strength. You haven’t had the second and third level of officials in grooming.

Laney: And at the national level, the Democrats have used Texas as an ATM for national campaigns rather than cultivating the grassroots. We’ve still got local politicians changing parties, which is not good for building a base for a statewide officeholder. It’s hard for a statewide officeholder as a Democrat to go into a county that may be voting fifty-fifty but every elected official in that county is a Republican.

TM: If I twisted both of your arms, would you make a prediction as to whether Governor Perry will be governor for the 2015 Legislative session?

Laney: I quit making predictions about what the Legislature or the public would do after I cast my first vote in the legislative process.

TM: Governor Ratliff?

Ratliff: Oh, I’m fearless. I think he’ll run again. I think when he starts looking at the presidential possibilities and sees that the numbers are not there, I think he’s going to realize that he doesn’t have any other place to go. As far as I know, he doesn’t have anything else he wants to do, and he’s got a free house. So I guess if I had to put my money on either side, I’d say that he’s going to run again and will probably be elected again—much to Mr. Abbott’s chagrin.