Gov. John Kitzhaber brought a message of change to an enthusiastic standing-room-only crowd at Portland's City Club today. 

"Putting people back to work – as important at that is – will not, by itself, reduce our prison population or the escalating cost of health care; it will not ensure that all our children are ready to learn when the reach kindergarten; or increase the number of Oregonians who get at least two years of post-secondary education or training," Kitzhaber said.

"The reason is simple – although not necessarily obvious: the systems on which we rely to provide these important services are failing us; they are based on a set of assumptions that are no longer valid and no amount of money will change that," the governor said. "We need to change the systems themselves."

The former emergency room physician excels at diagnosing problems. Whether he can cure them is another question. Kitzhaber is walking a thin line in these first few months of his unprecedented (in Oregon) third gubernatorial term. He has promised a wholesale shakeup in the way state government operates. But after asking for the resignations of about two dozen state agency directors, he recently retained all but two. He's been energetic in the Capitol, exhorting lawmakers to adopt his urgency and has lobbied aggressively for federal help on healthcare and transportation priorities.

But Kitzhaber is moving inexorably toward a show-down with a key constituency. He won election by fewer than 25,000 votes over Republican Chris Dudley last November. He owes much of that victory to big union contributions and a massive, public-employee union funded get-out-the vote campaign.

Now, Kitzhaber is a month into a legislative session in which he must cut $3 billion from the budget that lawmakers had expected to spend a couple of years ago. Given that the state's biggest expense is public employee compensation, Kitzhaber must now disappoint those who helped get him elected. And in addition to compensating those public employees less than they would like, Kitzhaber has made clear that he expects that they will deliver services, particularly education, more effectively.

"New approaches are also needed for our K-12 and post-secondary systems," Kitzhaber said.  "As 15 school superintendents pointed out in a recent opinion piece in The Oregonian:

'It should not be hard to let go of the status quo on education – limping from funding crisis to funding crisis with a system that does not deliver for students, bleeds resources away from teachers and leaves Oregon behind.'"

A couple of times in his speech, Kitzhaber went out of his way to extol the virtues of educators.

"As we begin to take on the challenge of these transformational changes it's also important to recognize those who have been on the front lines of our education system. Those teachers and administrators who have consistently had to do more with less, and many of whom, regardless of the system they are in, go beyond the call of duty day in and day out," he said.

The line that drew the biggest applause during the governor's speech, however, also laid out a prescription of tough love.