[Public Papers of the Presidents of the United States: George H. W. Bush (1992, Book I)]
[March 12, 1992]
[Pages 434-436]
[From the U.S. Government Publishing Office www.gpo.gov]



Remarks to the National Conference of State Legislatures

March 12, 1992
    Let me salute those who preceded me. I guess Dick--has Dick Cheney 
been over here yet? And Sam Skinner, our Chief of Staff. And then the 
piece de resistance, our fabulous Secretary of HHS, Lou Sullivan, who 
is, I mean that, he's just doing a superb job for the country. But I'm 
pleased to be here. I remember last year being unable to show up. I 
think it was the aftermath of the storm, of Desert Storm. But I'm glad 
to be here, glad to see Bud Burke and Bill Pound and Bob Connor and 
Terry Anderson, just greeting us. And last year, I think I owe you an 
apology for that.

[[Page 435]]

    That Desert Storm, I think, was a triumph for our country. And I 
still believe that it holds an enduring lesson for how we in Government 
can get things done. It's different, but there's some lessons that 
apply. We saw a challenge; we met it with resolve. The subject, as you 
will recall, was debated vigorously. And our duty as Americans--I think 
the country came together, seeing that our duty demanded nothing less 
than the action. But when the time came to act, partisanship was laid 
aside, and we put an end to the squabbling. And the job got done, and 
Kuwait was liberated.
    Incidentally, it is my judgment that that action, and I salute the 
people that participated in it, really restored credibility to the 
United States all around the world. I see it every single day that I 
interact with these foreign leaders.
    So now I don't have to tell you all who are on the firing lines in 
your various States that we face a great challenge again today. We're in 
tough economic times. We owe it to our country to do all in our power to 
get the economy moving. I am not gloomy about that, incidentally. Retail 
sales figures today were good. We've got some fundamentals that are 
getting in place, such as interest rates and inflation, that could be 
the forerunners of a very good recovery. But we've got to do something. 
So I take this getting the economy moving very seriously.
    I don't believe there's any one single magic wand that can be waved 
to accelerate recovery. But I also know that by taking just a few 
commonsense steps and taking them now, we can stimulate investment, help 
struggling businesses back to their feet, and put Americans to work.
    And what will happen if we can do what I'm about to suggest to you, 
I think you're going to see a rapid restoration of confidence. One of 
the great problems we have in this country today is, even though 
unemployment, for example, is statistically far lower than it was 10 
years ago in the recession of '82, the confidence isn't there. And I 
think that what I'm about to suggest would restore confidence if they 
saw that these things were going to be put into effect.
    To free up investment capital, we've asked for a new investment tax 
credit. It's a tax allowance, really. And what it does is speed up 
depreciation on the front end and would encourage, therefore, the 
purchase of new capital equipment, which obviously means jobs. I still 
favor, strongly favor, a cut in the capital gains tax. I think that 
would create jobs. And I also think that would restore confidence. We 
remember that both Houses had a majority for that, Democrats and 
Republicans supporting it a couple of years ago. We could never get it 
to a vote.
    On the housing industry, and I'm sure many are familiar with this 
one, we've asked for a $5,000 tax credit and that would be for the 
first-time homebuyers, and penalty-free withdrawals from IRA's for the 
first-time homebuyers. The homebuilders have enormously high estimates 
as to what the credit itself would do for the homebuying business. So I 
think these would have a stimulative effect.
    When I submitted this plan to the Congress, I asked them, as you 
remember, to put aside the partisanship and try to get some action, pass 
it in 52 days. We set a deadline, March 20th. And so now we're back in 
the political wars, and they're fixing to send me a package that I 
simply cannot and will not sign. And there is a massive increase in 
taxes on that package. And I fully believe that a tax increase here 
would be a disaster for the economy. I think it would hurt our future 
competitiveness.
    And I think that Congress--I don't think they will, but they ought 
not to doubt my resolve on this particular veto because if they send 
that tax-and-spend plan down here, I have to veto it, send it back. And 
then possibly in the Senate we can get action because some of the--I 
know we've got a bipartisan group here--but some of the Democrat 
incentives are very close to what we're suggesting here. And if we can 
narrow this package down and just go for the incentives, then when we 
get into all this campaign stuff, we can debate whether you need a 
middle-income tax or a tax break on the rich or a tax increase on the 
rich or whatever it is. So, I'm going to keep trying very hard to keep 
the focus on these incentives.
    I know that you feel, and I know I feel, that people are tired of 
the business-as-usual

[[Page 436]]

from Washington. And I know it's burdening some of your State capitols, 
too. In that area, business-as-usual, I'm talking about these unfunded 
mandates.
    Every time I meet with the Governors or legislators, they say, 
``Please help us keep Congress from inflicting mandates on us. Give us 
the flexibility. We might have a better answer in Mobile than they do in 
Moline, so let us try it our way.'' And I understand what happens when 
an unfunded mandate drops in on you from Washington. You've got to find 
the money if you want to participate in it to pay for somebody else's 
wish list, either by cutting out programs that you have on the books 
that you feel might be better or raising taxes at the local level. In 
other words, Washington takes the credit, and you end up taking the 
heat.
    And this message has been drilled home to me over and over again. 
And I think these mandates are irresponsible, and they cut right to the 
heart of the Federal system. So I've told the Congress if they pass a 
mandate, they just simply cannot pass the buck. They've got to pay for 
it without a tax increase.
    Then there's one other front in our fight to restore federalism. 
More than a year ago--and I know you all have been helpful working with 
us on this, and we're very grateful--we proposed a $15 billion block 
grant for the States because I believe that States are the laboratories 
of democracy. And you need and your constituents need the flexibility 
and the freedom to experiment, the freedom and flexibility that this 
grant would permit.
    And the conference has been invaluable, your conference, in helping 
get this proposal in shape. We introduced it last year, but we're going 
to be introducing to Congress soon, again. And I call on them to give it 
swift consideration.
    The key, we all know this, is working together: Republicans and 
Democrats, the Federal and State governments, the legislative and 
executive branches. And I would be the first to confess that I 
understand the pressures of an election year. But we know what we can do 
in those moments when we can set partisanship aside. And I think that's 
what the American people are calling out for right now. And we must not 
let them down.
    So, again, my thanks to you all for your support, for those of you 
who are supporting this block grant concept, helping us fend off more 
and more mandates from the Congress, and those who are with us in the 
idea that what we need for this economy now is something that will in a 
laserlike way stimulate an economy that is really ready to move and 
really ready to recover.
    I really do thank you. And I hope this hasn't been too inconvenient, 
off and on again on the schedule. But I'm off early in the morning. And 
I just looked forward to having a chance to at least drop in and say 
hello. So thank you all very, very much.

                    Note: The President spoke at 5:12 p.m. in Room 450 
                        of the Old Executive Office Building. In his 
                        remarks, he referred to the following officers 
                        of the National Conference of State 
                        Legislatures: Paul (Bud) Burke, president; 
                        Robert Connor, vice president; William Pound, 
                        executive director; and Terry C. Anderson, staff 
                        chairman.