Business, Politics, and Higher Education with Mitch Daniels, Former Governor of Indiana
Willy Walker: Welcome to another Walker webcast. It's beyond an honor for me to have former Governor Mitch Daniels and former president of Purdue University joining me today. As I said to the governor as we were talking beforehand. I've interviewed all sorts of very successful people on this webcast. I've had governors. I have had major university presidents, and I have had business executives. I have not had someone who has been wildly successful in all three of those fields. And I want to dive into how Governor Daniels has been so successful in both the private sector as well as in the public sector and as well as in the education field. A quick bio, not that is needed, Governor, and then we'll dive into some questions here.
Mitchell Elias Daniels Jr. is an American academic administrator, businessman, author, and retired politician who served as the 49th Governor of Indiana from 2005 to 2013 and the 12th president of Purdue University from 2013 until 2023. He is a graduate of Princeton University and Georgetown Law School.
Governor, when I was doing research on you, I did not know that your first engagement in politics was on Bill Ruckelshaus's 1968 senatorial campaign. In the summer of 1986, between my freshman and sophomore year in college, I worked for a lumber company out on the Olympic Peninsula outside of Seattle, Washington, and spent almost every weekend at the Ruckelshaus House on Lake Washington with his daughter Robin and his son Bill and I had known the Ruckelshaus family for many years.
I guess the real question I have is that, looking at your bio, you seem to be someone who has politics at heart. It was your first job. It seemed to be what pulled you. And yet I've heard you numerous times talk about both the joy that you've gotten out of running Purdue, as well as your time in the private sector at Eli Lilly, being if not the very close to being, the most rewarding professional experience you've had. Are you a politician by nature? Are you a leader by nature? Are you a businessman, or are you an educator? Or are you a combination of all?
Mitch Daniels: I like to be thought of as an American in the sense that politics, while it's part of our civic duty, we get the opportunity to participate, have a say, have a hand in. My judgment was never intended in our system to be the center of life. To me, public service, from which I came and went two or three times, is something that a citizen ought to do if she or he gets the chance. Not as an end in itself, not as a lifelong pursuit, but as a way to help the important parts of life flourish. The important parts are those places where people work, raise their families, and come together in voluntary associations. And I tried always to make certain that the folks working around me understood that. And saw it the same way, to protect against government becoming overbearing, overweening, and too expensive, all the things governments and all bureaucracies tend to do. So, I guess that's my outlook. And I'm really grateful for the different opportunities that I had to take part in our public life. But I hope I never let myself then or ever imagine that ought to be the center of life or an end as opposed to just a means.
Willy Walker: And governor, I guess the thing about that is that very few people either have the capability or talents to be able to if you will move industries the way that you have. You worked with Jim Baker in both the Reagan administration as well as in the George W. Bush administration, who is, I think, one of the few figures, including yourself, who has been masterful at moving back and forth between the private sector and the public sector? But many people, you've said yourself, you don't want to be the person who's on that last bus out of Washington, DC. But many people that you and I both know are waiting to take that last bus out of DC. They went, and they never leave. What is it about you that allowed you so successfully to toggle? There are very few examples of people who have been able to do exactly what you talk about, not making politics a career but giving back in public service. But then having a career of what I've heard you say previously the really important parts of our economy, of our world, our community, of being an American citizen.
Mitch Daniels: You really have to ask others that question the people who took a chance on me as I went from place to place. I never planned anything. Every so many years, the phone would ring and every so often that phone call would be persuasive. But I suppose that if I had any luck in those jobs. I was very fortunate that everywhere I went to work in proximity to tremendously talented people. You mentioned Bill Ruckelshaus being a great example, Dick Lugar being another, Ronald Reagan being another. I could name people from business life, several of them who were tremendous executives and leaders and I hope I learned something from every one of them. And it became an accumulative process but I would leave it for others to judge how well we did it or why it made sense for me to be in those roles in the first place.
Willy Walker: So you mentioned Dick Lugar, somebody who you went to work for as I believe you started working for him when he was mayor of Indianapolis.
Mitch Daniels: That's right.
Willy Walker: And then he obviously got elected to the US Senate. And you spent a lot of time working for him and then went into the Reagan administration. Talk for a moment about Senator Lugar, clearly an icon, clearly somebody who worked across the aisle. A, if you would talk a little bit about Lugar as a person, but then if the civility that many of us feel is lacking in Washington today that very clearly existed back when you worked for Senator Lugar.
Mitch Daniels: He was a paragon of public service in my opinion. He had the whole package. He was a brilliant Rhodes Scholar. He had an incredible work ethic, really was all about the job, as well as his own family. And he had an iron integrity. I said at his memorial service “In all the years I spent with him or knowing him I never saw him make a dishonest decision.” He also had enormous goodwill for people. I said that same day, “if he ever had a bad mood I didn't see it. If you ever badmouth somebody else, I didn't hear it.” One of his sons said, “Well, you didn't play golf with him.” Maybe we are all vulnerable there. But no, I could not have been more fortunate to have worked for him in the first years I was working really. And I know I was shaped by him in ways I probably can't even define myself today.
Willy Walker: I know you've read the book, The Last Great Senate: Courage and Statesmanship in Times of Crisis by Ira Shapiro and talking about that era in the U.S. Senate. What is it in your view that has changed in Washington that might make that era the last great Senate?
Mitch Daniels: Let's hope it isn't. And then, first of all, I think we have to be careful about nostalgia. And everybody I know thinks they're older. Their high school went to hell a year after they graduated and that sort of thing. But I think Ira had a point. You just go down the list of people who were serving then and they are remembered in a way by Moynihan, Baker, Scoop Jackson, Jacob Javits, Bob Dole, on and on and on. It's not likely I don't think that 20 or 30 years from now people will look back on the current senate with quite the same admiration. Now, on the other hand, you look back before that in American history we had some pretty lousy... In fact I would say that the rule rather than the exception is that Congress was made up of people of suspect ethics and very, let's just say, disparate talent levels. But no, we can always hope that we get lucky again every so many generations. Think of the founding generation, a collection of giants all in one place at the same time. And that Senate might have been to some extent an imitation of that.
Willy Walker: If you got the call today that you got 1988 from, I believe it's a former Governor Orr to take a Senate seat when Dan Quayle became vice president, Would you go to the US Senate today?
Mitch Daniels: No. And in a way, I got that call. In other words, there is an open seat right now in our state. And the incumbent is coming back to be governor as it happens. And a lot of people urged me. When he made that announcement, I had just finished at Purdue. And so I had a look at it, but no, I said at the time, not the job for me, not the town for me, and not the life I want to lead at this point. So very different reasons, bookends in a way. The occasion you're talking about was a harder call. I had thought of at that time the Senate as a dream destination and it had only been home. I had escaped and had caught the bus out of Washington that I was desperate to catch. Cheri and I really wanted to raise our girls here and so came home when they were one, three, five, and seven. So one year later this amazing opportunity of a Senate seat on a plate comes to me. But it was just the wrong time of life. I had children to raise. I had money to earn, to provide for their future and my wife's future. And so at that time I loved the idea of the job but it simply was the wrong decision from a life standpoint. All those years later, I wasn't as impressed with the job as it is today with the institution. And also, I thought there were better ways to spend my time.
Willy Walker: I guess you also now know what it is to be an executive. And at least from my friends who have been former governors who are now senators, Mark Warner and John Hickenlooper being two of them, Tim Kaine being another one, going from being an executive and actually being able to make decisions to be one of 100 is a very different role and a very different mindset as it relates to what you can actually get accomplished.
Mitch Daniels: Yeah, that was maybe the number one factor among the ones I mentioned. I did it out of respect for those who wanted me to do it. And had we run, we would have won, I'm more than confident of that. But I went out and I talked to maybe seven or eight current members of both parties, they were all very encouraging. But none of them could convince me or even tried to convince me that one first-term senator could make much of a difference on the list of issues that I mentioned to them that troubled me about the country. So there's no question that also was a factor.
Willy Walker: I remember if you think back to the Reagan administration when you joined two things on that one. We all now reflect back on the transformation of the country and the economy that took place under President Reagan's leadership. And it's easy to look back and say, “Oh, it was great.” And if you look at interest rates, interest rates going from the prime rate being 15.5% in 1980 down to where it's gotten to. It certainly makes today's interest rates look low, even though you and I were talking before this about how high interest rates are relative to where they've been over the past decade. But governor you were in that administration right when the supply side economics was being put into place, right when Paul Volcker was taking some very dramatic actions at the Federal Reserve. And for those first two years, the slogan of Morgan in America which we all associate with the Reagan administration wasn't actually there. What were those early days of the Reagan administration as there was this great sense of, we know what we're going towards, but the actual data that was coming out on a day-to-day basis was not reflective of where we ended up.
Mitch Daniels: Yeah. Some people I suppose have forgotten that it wasn't an overnight thing to go from stagflation, double-digit inflation, and double-digit unemployment almost. If you look at the 1982 elections and if you look at the way that President Reagan was viewed at that time, it was pretty grim. But he had the courage of his convictions. He was right about ... And by 1984 morning had dawned. That's what we remember. And such a lesson there in a couple of ways. President Reagan used to say that many people seek high positions to be something, a few seek it to do something, and urged those around him to be in the latter category. When my turn came, I tried in my own small way to emulate him.
Willy Walker: There's a picture that I saw of your family in the Oval Office with President Reagan on the couch and your daughters all around him. What was he like as a person?
Mitch Daniels: People used to ask me all the time and I would say, “What you see is what you get.” He is that person. He's affable, he's kind, he's funny, and easy to talk to. Now, at the same time, he was distant from almost anybody. There may be very few exceptions but almost anybody other than Nancy Reagan who claimed to be close to him, I think probably exaggerates. So when you were around him, he was a very kind person. But I don't pretend to have known him in any intimate way. He was the president to some of us with a capital T and we're grateful for the chance to associate with the mission he had set out for the nation and all to try to pull our small ore and move in that direction.
Willy Walker: You've been around a lot of both politicians and leaders prior to President Reagan. What was it in his leadership that was either unique or something that you learned from him because of your own leadership, there's no doubt looking at your career and your life that you've always been some would say a natural-born leader. Everyone would always sit there and say, “Mitch is the person who we'd like to put in front of us.” You've had too many leadership opportunities that you've taken and then also offered to you that say that you weren't a natural-born leader. What did you learn or see in Reagan that was something that said, “That might be something that I put into my tool chest as it relates to what I ought to either do from setting visions, the way I act, the way I communicate.” Was there anything specific that you learned from Reagan?
Mitch Daniels: Hunt big game. Try to identify. In fact it's your job to identify big-ticket items, things that will make a material difference in the business or in the success of the country. In his case concentrate your efforts on those and I also thought watching him that the essence of any such position. I always said, “It is the obligation to paint a picture, to be able to communicate to other people. How things here can be much better than they are today. How this business can be more successful. How we can serve customers we don't today. How can this state get off its backside and become a state of progress and innovation and so forth?” And President Reagan I suppose and he was faulted. Here's an area where I maybe try to do things a little differently. He gathered very talented people around him. He was a magnet for talent because people were inspired by the picture he was painting and the boldness of the changes he wanted to make. He didn't spend a lot of time working on the implementation of his ideas, the workings of the government, and so forth. When my turn came I did. But I always tried to replicate his approach in which there was never a year when we didn't have something big to put before our General Assembly or something big, we were trying to do in our administration. And I always saw my job is to get people excited about that. And when you do that and you have good people around, wonders occur. Whether you're watching the dashboard or not. I said, “I felt I learned something important from everybody I got to work for or with. And that would probably be the essence of the president as I saw it.”
Willy Walker: You returned to Indiana and went to work at Lilly and I've heard you say numerous times how rewarding that experience was, both in running North America and then running strategy and business development for such a large global firm such as Eli Lilly. It surprises me given the incredibly large and influential positions you've had in public service that you look upon that time in the private sector as being so wildly rewarding. What is it about that governor in the sense that was it that you were earning a good amount of money and it was very rewarding that in exchange for your great labors, you were making good compensation? Is it that the public sector has so many different things coming at you all the time, that you never really sort of can see the progress you're making? Or was there something that is unique about the culture inside of Eli Lilly that let's just say, “hypothetically you worked at Walker & Dunlop may not have been there.” What was it that made that experience so rewarding for you?
Mitch Daniels: When I said that those were the years, I'd trade away last, I think there are two or three reasons for that. One was I loved the mission of the place. The place was saving, and our products saved lives. The genius of our scientists made diabetes a manageable disease. The decades before had saved millions of people from depression and sometimes the fatal consequences of that and on and on. I thought it had a noble mission. It wasn't hard to get excited about. Certainly from a personal standpoint, I learned so much about that application later when I came to service in the two sectors which are notorious for incompetence and waste and abuse of positions. I'm talking about government and I'm talking about higher education as we know it today. And to have had the disciplining experience of those 11 years, some of them very tough. I won't give a long lecture here about the pharmaceutical industry but let me just say that when you've got new, innovative, and patent-protected products, you can't not make money. When you're in the opposite situation as we were for several of the years that I held the biggest line job in the company. You have to learn every trick or take every step you possibly can to produce growth. And as we were obligated to do so. The learning experience there was so formative and so helpful and so useful when I got to those other sectors, where they're not often very businesslike. And yes, it did provide for my family. I always thought that was the first obligation I had as a husband and father. And it did in a big way. Not to dwell on it but it enabled me to do things. For the next 12 years, my wife and I gave away more money to charity than I earned on a government payroll, and that was just fine. But we were able to do that because of Lily.
Willy Walker: You've been offered to be the U.S. Senator from the state of Indiana. My assumption would be when you were at Lilly, you got offered CEO jobs at other companies. Was there one that came your way that you thought really hard about that you're willing to share with us that you turned down and stayed at Lilly?
Mitch Daniels: I can think of one, but I'm not going to indict them. I'm not going to indict their judgment by telling you who it was. And I was not particularly tempted. Honestly, again, Lily was and is such a spectacular company, so ethical, so full of talent and idealistic people. I was quite happy there. I said earlier, “I'd never been a career planner.” I loved my years at Purdue. And one thing I loved was how purposeful our students were. I used to get the career planning question all the time and I had to laugh and say, “Well, you better ask the next guy because life planned me.” I commended them for thinking ahead, but I always urged them to be flexible and open because life would bring them unexpected possibilities. I used to illustrate that by saying that right up until a night in December of 2000 when I got a certain phone call if someone had asked me, “What will you be doing in April of 2014 or something.” I'd have said, “Well, I'll be retiring from Eli Lilly and Company,” and life changed totally three times after that.
Willy Walker: So that phone call comes in and by the way, who was it who called you? Was it the president-elect or was it Dick Cheney, or who was it who called you while talking about the opportunity to run legislative affairs for the Bush administration?
Mitch Daniels: It was first my old friend Andy Card, who became the chief of staff.
Willy Walker: Who worked for you in the Reagan administration?
Mitch Daniels: That's correct. And a first-rate person, a great American. And actually, Andy made a suggestion that I thought I was just the wrong person for and I said, “No, you can find somebody better for that”. And the next day was the vice president-elect. And he brought up OMB. And then I went home and told my wife, “Well, now we have a problem.” Because that's the one job they had, that's big enough and comprehensive enough. Touching the whole government as it does, I'm going to have to think about this.
Willy Walker: Governor the federal budget at that time, I think was $2.3 or $2.4 trillion. Walker & Dunlop is a billion-plus revenue company. And if you go on our audit committee, you have to be a certified financial expert to come on to our audit committee of this teeny, little company. Here you are going into managing the largest budget in the world, the largest economy, and the largest institution. This is the largest budget in the world. What was it like to dive into a $2.3 trillion budget? The concept of how you even approach that seems to be just overwhelming.
Mitch Daniels: Of course, it's a whole lot bigger today than it was then. But it's big enough then to be daunting in the way you say. Oh, it was exhilarating in its way. It was a new administration of course. With its own set of goals, I thought they were appropriate for the country. Now, ten months later, the agenda of the administration was changed by external events like the attacks of 9/11. But, no, it was everybody thinks about the budget first and that was the first assignment. How the federal government ought to spend its money. And I spent more time on that than anything else. However, I was attracted to the job also because of its regulatory oversight. And when I was coming out of a highly regulated business, I felt then, I feel much more so now, that the federal government is way outside its bounds in terms of the controls and limits and regulations and mandates that it keeps applying to the economy in the country. So I was very eager to say revive, reinvigorate. What's called the OIRA, Office of Information and Regulatory Affairs. And we did. And that needs to happen again in a big way now by the way. And then management, we always said, was the forgotten aspect of the job. I was determined our group was to, as we said, “put the M in OMB,” what turned out to be a largely futile exercise for several years. We evaluated hundreds of discrete programs in the federal government asking the simple question, “What is their goal? What is their statutory assignment and are they accomplishing it? And how can we measure to know?” Now, that's something you would do in business every day of your life. That was an alien concept in the federal government. We reported that faithfully to Congress. On the commonsense premise that when we found a program and we found some that we're doing a good job. For dollars spent they were achieving what they were supposed to. The National Weather Service was one. And the women, infants, and children program was another. And so meanwhile we were identifying many more that were either duplicative or totally failing in their assignment. Of course, the obvious difference is if you took that to a board of directors at your company, they'd act on it right away. The board of directors of the federal enterprise has a chance to have different incentives. If any program was ever terminated or even severely curtailed because it was not well-managed and was not panning out, I'm unaware of it.
Willy Walker: You were in the OEOB on 9/11 and could look across the river and see the smoke plumes coming out of the Pentagon. I listened to you tell a story Governor about leaving the White House and you called the driver and asked him to get your briefcase and also get your gym bag. And I was both impressed and also surprised that you asked him to get your gym bag. I guess my direct question is, did you actually squeeze in a workout on that day or was that just a habit if things settle down a little bit?
Mitch Daniels: Actually, maybe it's embarrassing to admit I think I did actually, but we were out of there. I didn't know how long it'd be till I got back in. As it happens, I was probably the first person admitted back through the perimeter that the military had set up. But that was not until well into the afternoon. So I got out to my little apartment, a one-person apartment up on Connecticut Avenue, and learned what I could about when I could get back. And I think I had an hour or so to do what seemed like a virtuous thing.
Willy Walker: You leave the Bush administration and decide you're going to run for governor. First of all, if you flashback to 1988 being offered the senatorship, your name clearly was known. And yet at the same time, you'd been in the private sector for 13 years. While being an OMB director is a big job, it's not a household-name job. So clearly there were people around you who, from the very earliest days had said you need to run, you need to be the candidate, not an OMB director, for president for example. What was it that gave you the desire and confidence if you put your hat in the ring? I just heard you a moment ago governor say, “If you run this time, we know we would have won.” And that you can say declaratory because of your name recognition and all that you have done and accomplished. But back then, that was not evident or clear. What was it that either gave you the compulsion to just have to run, or the conviction that you would win if you did run?
Mitch Daniels: I had the interest, but not necessarily the confidence. Nobody knew who I was. Not in any big sense, I guess a number of people in some leadership capacities in the state maybe, but not across 6.5 million of my fellow citizens. I think it was a couple of things. One, I was weighing whether I had done enough to justify it by asking for my honorable discharge. My daughters were going through high school and in fact I was missing high school for the youngest one, who they are all apples in my eyes but she certainly was one. Especially after 9/11, I was not able to get home very much. So that was weighing on me. And I made a little list of four things. I said, “If we can get these four things done, I'll feel that in good conscience. I can go ask the president to release me.” Meanwhile, back home, I was here all the time from folks who were very troubled. And I was two that our state was sinking, wasn't going anywhere, the state was broke, and the state government was a big dysfunctional mess. Somebody needed to do something about it. And so the combination of those things led me to decide that once those four boxes were checked, I would give this thing a try, and off we went.
Willy Walker: So you took a month off and then you jumped on the RV One tour? Explain to people the RV One tour. And I think more importantly governor, I've heard you and this is jumping ahead a little bit, I think it's important for us to think about 2003, when you decided to run for governor, got the RV, started the RV Tour, and that one of the issues you were trying to do was you needed to see people meet them where they live. But then also at that time, the image of the Republican Party, looking at economic policy, looking at various things, but not being as engaged, if you will, with the voting population. And that the RV Tour was something that would allow you to some degree dispel that image. And now fast forward to 2024 where we are the role of the two parties is sort of inverted. But go back to 2003, if you will, as it relates to the RV One Tour and why you felt that was so important. Because as I look back on it Governor, I would put forth that starting there, hitting the road was a key component to your success.
Mitch Daniels: No, it was the key component. And not just to win an election, but to something more important which was being ready for the job. But you're quite right. I would say that the recent transformation of our politics is the most profound since maybe the so-called Southern Strategy of the 70s and 80s when the South went from monolithically Democratic to heavily Republican. What we've seen in the last few years is that working-class people are heavily inclined to the Republican Party, and rich and well-educated people are overwhelmingly Democratic. That's just upside down from what the situation at least was perceived to be in 2003. I had never expected to run for office. After the episode you mentioned, 1988 when I passed on the Senate seat, I really thought that's that. I was fine with that. But I had encouraged people, I had good friends who had run or considered running, and I had said to them, “This stereotype Republicans are the party of the rich and the party of the country club and all that.” I said, “It's not fair, but don't whine about it. You got to have to go out and disprove it.” And I suggest to them they do something roughly like we finally did. Nobody took me up on it. Lamar Alexander in Tennessee came the closest to what I had in mind. But when my turn came, I said “This was how we had, how we really were going to approach it.” Indiana happens to be the RV capital of the country. A high percentage of the vehicles are produced here. So we got one of the entry-level country mouse RVs and hit the road. And I'm not exaggerating, 20 years later, people still ask me about that campaign. If it has a business school case should be done about it. Forget it was politics as an exercise in branding. So, the slogan of the campaign, which came from a line President Bush tossed off a few days ago, “My man Mitch was Everywhere,” and the RV was everywhere. We had people sign it. There were thousands and thousands of signatures all covering the thing by election day. On purpose, we had gone to every corner of the state over and over. Nobody comes here anymore places. I do think that it had the effect that I wanted it to, to make the point that everywhere mattered. Everybody mattered. We're in this together, and things can be a lot better than they are. And that was just something I believed was the right thing to do. Put the personal contact back in politics. Now, no political mercenary. No consultant would ever encourage you to do this. Maybe a little just for show, listening tour, one of these things. Little stunt. But not 16 months, almost every single day on the road. Staying overnight, by the way, in people's homes which I started out because I didn't want to spend the money. And then it became such a learning experience that it became a signature. We continued there for eight years as governor, by the way. I know we defeated the stereotype of who was more in touch with everyday people.
Along the way, I learned so much. Lamar Alexander, when he saw what I was doing, told me, “You know it'll probably make you a more successful candidate. It'll definitely make you a better governor.” And he was exactly right.
Willy Walker: You not only defeated the stereotype, but you also defeated an incumbent which had never been done in Indiana state history.
Mitch Daniels: Yeah. But you wouldn't have to do it today. Now it would be presumed. It almost is the inverse. Today it's almost incumbent on Democratic candidates to show that they're not living in the so-called elitist bubble.
Willy Walker: Yeah. Branding, My Man Mitch. Morning in America. 4321. You talked a moment ago about bold, highly ambitious goals, making sure that they are big goals and that people get focused on them. There's also an aspect of branding there, making sure that the goals are, if you will, synonymous or aligned with a mission, if you will. Once you, my man Mitch was the governor of the state of Indiana, what was the underpinning mission or slogan of the leadership of Mitch Daniels as the governor of Indiana?
Mitch Daniels: I suppose it was aim higher, which was a phrase I use all the time. The history of our state and its characterization was that we were pretty much conservative in the broader sense of the term, let somebody else try it first. If it ain't broke, don't fool with it. And the theme of our entire effort in our really, ten years was that if that was ever an adequate strategy, it's not in this world. And so we were constantly trying to press the action. I've admitted many times that I started for a very short time with exactly the wrong idea, which was to keep it simple, and stupid. It was not a bad tactic or strategy to say. Our team, our party and had been out for 16 years. And for a little while, I said, “Look, we won't complicate this. The state is broke. The state government is brokenness. 16 years is long enough, QED.” I wasn't out there very long in that RV before I realized that was wrong. First of all, it's not really very responsible. People deserve to know. “Okay, fine Big boy. Yeah, I agree, things aren't good. What are you gonna do about it?” And secondly, if we formulate and commit to a series of big and specific ideas and we happened to get elected, we'd have a larger claim to go do those things. So we could legitimately say people had heard it and endorsed it. Now we're going to go do it. And so by the time we got to Election Day, we might have overdone it, but we had 70 very specific plans, large and small. Some we could do administratively by executive action and many we had to have legislative help to do. But we were monomaniacal about getting them done, doing what we said we'd do, and ultimately got almost all.
Willy Walker: So two very successful terms as governor, 2012. A lot of people are saying Mitch Daniels ought to run for president of the United States. You decided not to do that. What was the main driver of backing away from running for president?
Mitch Daniels: Ultimately my family. That was a stop, wasn't the only negative reason, but it was a stopper all by itself. Cheri and the girls really did not like the idea. That would understate it. And I used to joke that, “I can't comment. It's not as bad as you think. They'd been there twice. They'd seen what White House life is like. Even if everything else had been pushed me in favor that would have been a hurdle I couldn't get over. I will say there was something else.
I said a minute ago that I was very fixated on the idea of confounding another stereotype, which is that people in politics don't say what they really mean. Don't do what they say. And I was resolute to be an exception to that rule. And I had said to the people of Indiana that this is the only job I've run for or ever will. I was reminiscing just today, I used to make all my own TV spots, not make them. I always thought it was the best part of my job. And the very last spot of the reelection campaign in ‘08, I think I started by saying, “hey, Indiana here's some good news. This is the last time you'll ever watch me in a commercial like this.” And then went on to make our closing pitch, and I really wanted to stay with that. And I'm asked all the time, people say, “well, do you regret that you didn't try it and so forth.” And I'll tell you that now with the benefit of hindsight, a major reason that I'm glad for the course we took was that I was able to finish the second four years very strong. So we did some of the biggest things of all in the seventh and eighth years. That's not supposed to happen. Lame ducks and all that. I used to say to our team all the time, “look, lame ducks can still fly.” We're not putting it in neutral here. We were able to win a big legislative majority in 2010, which enabled us to do some big 50 caliber things. Right to work, and the inheritance tax, a host of things that automatic tax refunds when the state has more money stocked away than it needs, things like this. If I'd been out running for president, none of that would have happened if I had been off in New Hampshire or somewhere. First of all, people would have said, “well, he's only proposing that because he's running for this other job.” And so, when my girls were little, shooting baskets in the driveway, one of the rules was to make your last shot. You can't come in at dinner if you have to make your last shot. Well I wanted our administration to make its last shot and I think we did.
Willy Walker: About a quarter of university presidents come from outside of academia. Three-quarters come from inside academia. So you are clearly an exception to the rule as taking the job at Purdue. One of the things Governor that in doing research on you, that just is amazing, is that in nominal terms, not real terms. But in nominal terms, the cost of a Purdue education today is less than it was when you joined as president in 2013. I don't know. I haven't gone to look at it, but I don't know that there's another university in the United States that can make that statement. And in the process of holding tuition flat. You increased this in-student enrollment by 30%. When I read that Governor, I sat there and said, “Man, his supply-side economics learnings in the Reagan administration in the early 80s really sunk in.” But talk about that for a moment, because there are plenty of successful big university administrators out there today. And I had Mary Sue Coleman on the Walker webcast a month ago. And Mary Sue at Michigan is one of them. But I don't know if there's anyone who can state what I just said about you and what your decade at Purdue did for the cost of an education at Purdue, and then the access to the learning that takes place on that campus.
Mitch Daniels: I did come from outside and that has all the obvious handicaps. I had huge learning curves to climb. But on the other hand, you do have a perspective. My perspective was that the people were being squeezed, especially people in the middle-income brackets. Even by the cost of public education in Indiana. And I’ve been asked repeatedly over the years how this happened. I generally say, “start by asking the right question.” Instead of asking, and this is the way most people in Higher Ed are socialized. They had it easy for so long. The question they asked was, how much money would we like to have this next year to keep everybody happy and keep on doing what we're doing? And then they'd dial up tuition to produce that amount, and they were able to do that. In Purdue’s case, 36 years in a row just like so many other places. And we asked a different question, what would we need to do this year to avoid that, to avoid an increase? And sometimes I said, “We solve the equation for zero.” And it turns out not that hard. The fruit hangs pretty low in higher ed. Purdue had been better managed I think than most schools. But still, there were all sorts of fairly obvious things. If you establish, as for instance, that Reagan had a primary goal and try to point towards it. Yes, you’re quite right. Business is a business audience that no one will be surprised to know that you can set up a virtuous circle and grow your market share. We know from surveys of the students every single year and its continued, by the way, been a record number of applications to Purdue University. We know from surveying those applicants that second only to the correctly perceived quality and rigor of a Purdue degree the cost and the confidence that you won't get socked with a big surprise every single year. A big increase was a driver of the surge in interest in our university. And so yes, we did grow by 30% or more. And what a strong top line is your ability to operate a place.
Willy Walker: When you joined Purdue, 41% of the students were focused on STEM. When you left a decade later, almost 68% were focused on STEM. What did you do as it relates to making Purdue such a standout institution as it relates to STEM? It obviously had a reputation there but going from 40% to 70% as it relates to students focused on STEM is something. It was that investment in professors, in facilities, in branding. What was it that took Purdue to be at the very top on STEM?
Mitch Daniels: We were building from strength. And that's something that reinforces strengthening or a great product line is something that our businesspeople, most of them that I know, think is wise. It was the single biggest reason I accepted the Purdue job. I turned it down two or three times, but I couldn't quite say. And I said yes, it was because I had come to the conclusion that aside from the job I was leaving, there was no place, no job a person could go to, where there was the potential to do more for the state I care about. And in the nation, too. And why do I say that? Norman Augustine, a great businessman and public figure of the last half-century had just finished leading a National Competitiveness Commission. And the number one recommendation they had made was that the nation needed 10,000 more engineers per year. So I said, “Well we can take care of the first 7 or 8% if we do this right. The rest of the country surely can handle the rest.” We did make investments heavily and we accepted that we were getting lots of applications but we needed to build the capacity to accept more. But we did. And of course, in hiring the best people we could, which attracted even more students and graduate students and success built on itself. No, I mean, it's as you say, it's in the high 68% I think don't forget of a much bigger...
Willy Walker: Yeah. That's the cool part of it. A lot of the criticism goes to the Ivy’s, and I'm very happy that you're wearing a yellow P and not an orange P on your shirt. Many people would still be wearing their orange P. But they haven't learned how to extend their brand, that they sit there and they have benefited from it being a very elite brand and making it very hard to access. And they are more concerned about their yield numbers than they are on taking their incredible educational experience and broadening it out to allow more people to access it.
Mitch Daniels: They've been selling prestige. It's become more and more clear. They've been bragging about how selective they are. I said to our board in our Purdue family, I said, “We want to be known not by how many we turn away, but how many we turn out.” And now the goal in doing that of course if you do grow is to maintain rigor and enhance it if you can. I had to point out to folks now and then that sure accessibility, affordability, holding tuition and other costs where we did, was a primary goal that we had but that only deals with the denominator. The question I always put is we're about to deliver higher education at the highest proven value. Value being the objective in business or anywhere in life value is quality over cost. And so we invested heavily in quality. I never let anybody suspect that, in any way, we scrimped on quality quite the opposite. We invested very heavily. We paid our people every year at the median, pay increase or above. And we would never have penalized or risked the rigor and quality of a Purdue education. We fought against grade inflation and all those things. The day will come when the board and my successor who have extended the freeze now twice, we'll finally have to make some adjustments. But now you will be there still. And that was the real goal.
Willy Walker: I would tell you, your successor looks to be from afar an incredibly impressive individual. Governor, just on four, three, two, one. Because I found that to be so impressive. Explain to people what four, three, two one is.
Mitch Daniels: I think you're talking about a slogan. Actually, I didn't invent this, but one of our students did.
Willy Walker: Really?
Mitch Daniels: Yeah. Graduated in four years or less. I want to emphasize that. I'll come back to that. But I will graduate in four years. Maintain at least a three-point grade average. And let's see what else they have in.
Willy Walker: Two hours of home.
Mitch Daniels: Minimum of two hours of study for every hour of class and be very active, not just the member, in at least one extracurricular activity. That was their recommendation to their own fellow students a few years ago, I had adopted it right away.
Willy Walker: And I heard that and I said.
Mitch Daniels: Naturally, the authors had graduated.
Willy Walker: I have two sons in college right now. And I literally immediately texted them, and said “Four, three, two, one.”
Mitch Daniels: Yeah. No, a pretty good formula. I want to say something about the four, four-year degrees being an American convention in Europe and other places. Generally, it's three. And so, we made a big point. In fact, I've been a believer for a long time, and at least in certain contexts, and Higher Ed is one, nonprofit world, government in prizes. So I set up, I think a half a million in prizes to the department that first came forward with a portfolio of three-year degrees and our liberal arts college did, others followed, and now as I look at those 70 or 80 different degrees at Purdue can be achieved in three years. It's not that hard to do that. Most students will take some summer school. They'll have one or two semesters where they heavy up, but maybe three hours or something. And the other part is mapping it out so they don't take too many courses that don't apply to the degree. And so one of the metrics we watched most carefully, I did anyway, was time to degree which came down from something like 4.3 to it's around 3.8 something now at Purdue. And that's why it can be very important because an extra year that years of difference may be visible, and saves money on the front end, but also an extra year of earning compounded over a career is real money.
Willy Walker: It is real.
Mitch Daniels: We can't do everything. I said, “We can't make an aeronautical engineer or a pharmacist in three years. But we can make a sociologist or something.
Willy Walker: I could keep going for a whole ‘nother hour, but I'm pretty good at starting at the bottom of the hour and finishing at the bottom of the hour, and you've been extremely generous with your time. But I want to come to Indianapolis, honestly, and take you out to dinner and continue this conversation because I've enjoyed it tremendously.
I guess the final question I have for you is what's next? You've been such an incredible leader. As I said, at the very top in three different industries, if you will, the private sector, public service, and education. What's the next step? Tell me. It's not that you're just going to step back and spend more time with your grandkids which obviously would be thoroughly to your right and privilege. And at the same time, for all of us who are looking for your leadership, we'd love to hear that there's some other challenge you want to take on.
Mitch Daniels: I will see. I made the mistake, I cautioned a lot of friends not to say yes to too many things. So I'm involved with at least three or four businesses in different capacities. I still write columns for the Washington Post, try to have a little say, in that way, and give speeches here and now and then. It's nice to just do the ones I want to do, or that a good friend asked me to do and not things I just feel I have to do. So I'm plenty busy. Writing what might be another book, but on the other hand, it's gotten so long already, that I'm not sure anybody's ever gonna want to look at it. I was encouraged to try to write more or less a memoir. And so, I'm filling the days up. But nothing 24/7. And, if the phone rings with something like that, I think I got some miles left in me, but I'm plenty busy if it doesn't.
Willy Walker: I'm deeply thankful that you took the time to join me. It's been a real pleasure. And I thank you and thank everyone who tuned in today to listen to this discussion. And I hope everyone has a great day. Thanks very much, Governor.
Mitch Daniels: Enjoyed it. Thanks.
Willy Walker: Thank you.
