EDITOR'S NOTE: As the Nov. 2 governor's election approaches, reporter Robert Behre is talking with Republican Nikki Haley and Democrat Vincent Sheheen on the biggest issues facing the state. The first installment in the series focuses on jobs and the economy.

Question: The state has one of the nation's highest unemployment rates. What's the single most important step you will take to put people back to work?

Haley: Comprehensive tax reform. When we look at eliminating the small business income tax, we will give businesses cash flow and profit margins, and they will hire people. The four or five states in the country that have no corporate income tax have the lowest unemployment numbers.

Sheheen: To be personally involved in economic development and recruitment, like (former Gov.) Carroll Campbell was, like (former Gov.) Fritz Hollings was. We have had an eight-year period where the governor was not very involved, and it has shown in increasing unemployment rates. And that to has to be change.

Q: The state continues to pass more of the cost of education (primary and higher) on to the counties and the people paying tuition bills. The Department of Corrections is running a deficit. The Budget and Control Board effectively has been eliminated. And there won't be $1 billion in federal stimulus money next year. How will you balance the budget? If you say cut fat, please point to specifics.

Haley: We will go to every agency and say, "Start at zero. What do we have to have?" and work our way up. We will incentivize agencies not to spend, and we will make the hard decisions that will strengthen businesses and produce jobs so that when we come out of this hard budget year, we're actually out stronger and more competitive than when we started.

Sheheen: The Legislature has to work with the governor to balance the budget. One person can't do that and shouldn't pretend that they could. What we have to do to balance the budget is shift to a programmatic budget approach instead of adding and subtracting to agencies. We have to dig into each program with objective criteria with the results that they are producing.

Q: Lawmakers have a reputation for commissioning studies only to toss aside the recommendations. What makes the Tax Realignment Commission different? Many say the premise of the commission is flawed, given that it can't address problems that have arisen from the Act 388 property tax reform. Is its work legitimate given that it was barred from looking at this basic piece of the taxing structure?

Haley: I will take into consideration the recommendations of the TRAC commission, but I will come out with my own comprehensive tax reform that will strengthen businesses, put more money in people's pockets and make sure that South Carolina is working toward economic development and increased investment in our state.

Sheheen: It should have been allowed to look at Act 388 and property taxes. I supported legislation that would have allowed it to do so. While its work should be considered and may be helpful, that is a serious flaw in its ability to comprehensively look at the tax code.

Q: Did you agree with what the state did to lure Boeing? If not, how, specifically, would you suggest the state lure new businesses here in the future?

Haley: Yes. I think we need to take it on a case-by-case basis. ... It's not the quantities of companies, it's the quality of companies. We need to recruit good, strong quality companies that are here for the long term, that understand that they have to take care of the small businesses that are already here and that they will produce jobs.

Sheheen: Unlike my opponent, I actually voted for them and made sure I was there for the special session. I thought it was important that we do what we could to gain the employment from Boeing. I do think that for future projects, it's much more important that we have a more coordinated strategy through the governor's office, and that the governor and the commerce department coordinate with local economic development officials and leaders so we don't have a haphazard approach.