    [Public Papers of the Presidents of the United States: William J. Clinton (1993, Book I)]
    [July 27, 1993]
    [Pages 1207-1211]
    [From the U.S. Government Publishing Office www.gpo.gov]

    [[Page 1207]]

    Remarks to the National Conference of State Legislatures
    July 27, 1993

        The President. Thank you very much, Art. Thank you for your
    leadership of the National Conference of State Legislatures, and thank
    you for your friendship to me. And most of all, thank you for giving me
    the chance to speak with all of you by satellite today.
        It wasn't very long ago that you and the other leaders of the
    National Conference of State Legislatures came here to Washington along
    with some State legislators from California to speak about the specific
    problems of their State. I understand your incoming president, Senator
    Bob Connor from Delaware--perhaps he remembers, as I do so well,
    stopping in Wilmington last fall when my voice was so bad I could barely
    speak. I hope you're all able to hear me a little better today.
        And to all my friends from Arkansas, let me say I do miss you, and
    there are plenty of days when I would trade with you. But after all, I
    asked for this job, and most of the folks in the Congress do want to
    move this country off dead center and move it forward, and I'm convinced
    we're going to break the gridlock and go forward with your help.
        President Franklin Roosevelt once said that, ``What this country
    needs is bold, persistent experimentation.'' As a former Governor who
    has worked with you to redefine how our Government can best meet the
    needs of our people, I think I know what that means. Most of you in this
    audience and most of the Governors with whom I work really have worked
    hard for a long time now to represent the laboratories of reform,
    whether in the cause of reinventing Government or controlling health
    care costs and providing health care to people who don't have it or
    giving people the dignity to move from welfare to work or to build an
    ambitious set of national goals for education or to devise State
    strategies for generating jobs and income.
        For more than a decade, I have worked on these reforms with you.
    Now, as President, my administration aims to establish an historic
    partnership between the White House and the statehouses to give you the
    freedom to experiment in bold and innovative ways to meet the unique
    needs of people in your own States. The first order of business, as you
    know, must be to reclaim control of our economic destiny. Here in
    Washington, I put forward an ambitious economic plan that finally does
    something serious about the deficit, reducing it by $500 billion to be
    locked away in a deficit reduction trust fund, the largest deficit
    reduction program in history, with $250 billion net in real, enforceable
    spending cuts. This plan restores tax fairness. For every $10 we reduce
    the deficit, $5 comes from spending cuts, $4 comes from taxes on the
    wealthiest 6 percent of Americans, and only $1 from the middle class,
    with working families under $30,000 held harmless.
        This plan keeps faith with the hard working middle class, because
    over the course of a year, the average middle class family of four would
    pay about $1 a week. The plan is designed to restore our economic
    greatness by cutting the deficit and by getting on with the business of
    investing in our future. And you at the State level know that we have to
    do both. You couldn't run your State budgets with the kind of deficits
    we have, but if you didn't invest and give incentives to the private
    sector to invest, you know you wouldn't be able to meet the global
    competition.
        So indeed, we must invest more to start new businesses, to create
    new jobs, to rebuild our infrastructure, to train our workers for the
    jobs of tomorrow. Our plan invests in our people and their education and
    their training as workers and new police officers on the streets and in
    new technologies that will boost economic growth and help to put our
    defense workers back to work. And analysis shows that this plan will
    create in California alone roughly 1.9 million jobs by 1996. As
    Government borrows less, interest rates will go down, and America will
    invest more.
        Since I was elected President and it became clear that Washington
    would now be serious about deficit reduction, the financial markets have
    reduced long-term interest rates to historic lows. That means lower
    mortgage payments for middle class homeowners, particularly in
    California where property values are so high, and better loans for small
    business entrepreneurs who create a majority of our new jobs. It also
    means lower interest rates for cars and consumer loans.

    [[Page 1208]]

    I'll bet there are people here at this convention who have refinanced
    your own home in the last 6 months and are saving a lot more money in
    lower mortgage rates than you'd be asked to pay in the modest fuel
    taxes. If we can keep these interest rates down for a year, this
    economic plan will pump between $50 billion and $100 billion of new
    private investment back into the economy by the end of the year. In the
    end, it all comes down to this: a choice between change for the better
    or more of the same.
        We've seen the cost of gridlock, and the price is simply too high.
    We cannot afford for Washington to put off the hard choices or pass them
    on to people like you in the States any longer. It's time for us to act
    to get our own house in order.
        We have to keep pace with the economic changes that are going on in
    the world. We have to decrease the deficit, lift the skills and wages of
    workers, open opportunities for young people who work hard and play by
    the rules.
        I know you've got some questions for me, and I want to get to them
    in a moment. But first, let me tell you about one more issue, an
    announcement I made just a few hours ago with Vice President Gore and
    Attorney General Reno. I know it concerns people in San Diego a great
    deal, and it concerns many of the States which you represent.
        Earlier today, our administration took new critical steps to control
    the growing problem of illegal immigration. America will continue to
    welcome new citizens into our family with honor and with dignity. But we
    will not allow terrorists and smugglers to dishonor the millions of
    immigrants who live here lawfully and contribute to the vitality of our
    society.
        We will, first, expedite the process to exclude undocumented aliens
    without credible claims to asylum. Second, toughen penalties in law
    enforcement efforts to crack down on gangs of so-called ``coyotes,'' or
    organized crime syndicates who smuggle illegal aliens to America by
    boat. And third, increase funding for up to 600 additional border agents
    and the training and technology they need to be effective.
        We will not surrender our borders to those who wish to exploit
    America's history of freedom and justice, to engage in terrorism against
    Americans or traffic in human cargo. By correcting the system, by moving
    against those who traffic in cargo, and trying to make it far more
    difficult for terrorists to travel to this country, we will also protect
    the immigrant who comes to America legally to live by our laws, work for
    a living, and to pursue the American dream.
        I'm very grateful to the Vice President for coordinating these
    initiatives since we began this effort on June the 18th. And I also want
    to thank California Senators Feinstein and Boxer and the Hispanic Caucus
    and Congress for their aggressive work in trying to resolve this
    difficult issue through a balanced approach.
        Now, I know you have some questions, and I want to answer them. I
    ask, finally, for your partnership: passing this economic plan, moving
    forward to the reinventing Government program, to a new health care
    program which will alleviate enormous pressures on your budget as well,
    and to helping you fight the battles against crime and for welfare
    reform, and to open the doors of college education to the citizens in
    your State. All that awaits the successful conclusion of the struggle in
    which I am now engaged and for which I seek your help.
        The floor is yours. Thank you.

    Unfunded Federal Mandates

        Arthur M. Hamilton. Thank you, Mr. President. Our first question
    will be offered by State Senator Robert Connor of Delaware, president-
    elect of NCSL.
        Mr. Connor. Good afternoon, Mr. President.
        The President. Good afternoon, Bob.

    [Mr. Connor thanked the President and asked if he planned to relieve the
    burden of unfunded Federal mandates.]

        The President. Yes, I can. First, I have to be careful what I say
    because I've promised the Vice President faithfully that we would not
    dribble these recommendations out a little at a time but instead we'll
    try to present them in a package.
        But I'd like to mention just two things if I might and to offer you
    an invitation. First, I want a part of this reinventing Government to be
    a reaffirmation of the idea that the Federal Government should not
    continue to put unfounded liabilities on the States. Second, I would
    like this report to also specifically outline some areas in which we can
    deregulate our relationships with the States and with local communities
    as well, where we can provide the funds that come from the Federal
    Government and the partnership that comes from the Federal Government
    without so much front-end regula-

    [[Page 1209]]

    tion but instead evaluating whether these programs work after you've
    been given a chance to implement them. I hope both those things will be
    a part of the final report.
        In that connection, I want to invite you again, and I know you've
    been consulted before, to give us collectively or any individual in this
    audience to present to us any specific recommendations you have for the
    kinds of things we could do that might save the taxpayers money, save
    you bureaucratic headache, and still put more funds or other resources
    into your hands so that you can actually solve the problems of the
    people that you are closer to than we are here in Washington. And I want
    to invite you to do that. We still have a few weeks left before we
    finalize the program, and any specific suggestions you have will be most
    welcome.

    Energy Tax

        Mr. Hamilton. Mr. President, thank you. Our next question comes from
    Karen McCarthy, representative from Missouri, vice president, National
    Conference of State Legislatures.

    [Ms. McCarthy asked if the proposed gas tax would be dedicated to the
    highway trust fund.]

        The President. Well, that's a subject, actually, that is now being
    discussed in the conference. It was raised with me for the first time
    today, actually, and I say that because you have given me a little
    impetus now to get more involved in this question. As you know, when I
    proposed the Btu tax, I thought the compromise would be one that saved
    the Btu tax without imposing it on production. I still think that was a
    better alternative. But the Senate fuel tax proposal seems destined to,
    in some form or fashion, become a part of the conference. And I will
    take that issue up with them. I want to make sure you understand,
    however, that even if it is put into the trust fund for the period of
    the deficit reduction, it still has to go to that. Of course, after
    that, it could then be freed up for the original purpose for which it
    was intended if we had done what we ought to do by then, which is to
    control health care costs and otherwise change the Government so we're
    moving toward a zero deficit, which is what our ultimate goal ought to
    be. But I will consider that. I never even thought about it until the
    last day or so, and I appreciate you bringing it to my attention.

    Block Grants

        Mr. Hamilton. Mr. President, our next question comes from Senator
    Bud Burke, president of the senate in Kansas and the immediate past
    president of NCSL. Bud.

    [Mr. Burke asked if the President would support legislation to
    consolidate Federal programs into flexible grants.]

        The President. Senator, let me ask you a question. Have you
    presented that specific proposal to the Vice President's task force on
    reinventing Government? Do you know the answer to that?
        Mr. Burke. Yes, we have. And we've also discussed this proposal with
    congressional leaders over the past 3 years.
        The President. Let me tell you that, generally, I am very favorable
    to that sort of approach. I must say I was disappointed when we were
    trying to pass the emergency jobs package earlier in the year, that
    there seemed to be so much resistance or at least so little enthusiasm
    among Members of the Congress in both parties for the community
    development block grant program. I don't know what your experience has
    been in Kansas, but in Arkansas, I can tell you that if it hadn't been
    for the CDBG funds and the flexibility they gave us, it would have been
    very difficult for us to have the kind of aggressive economic
    development program we had when I was Governor.
        So I am generally very favorably inclined toward consolidating
    specific programs into larger block grants. I will look at the specific
    proposal; I will review it; I will discuss it specifically with the Vice
    President about in terms of what role it should have in his final
    recommendations.
        But I have to say that we're going to have to do a little work on
    Members of Congress from both parties to increase their enthusiasm for
    the block grants. I don't quite know what the problem is, because it
    seems to me that the evidence is clear, at least based on my personal
    experience, that Federal money goes farther, does more good, has a
    bigger impact if we stop trying to micromanage it and overregulate it
    and instead let it be spent where the people and the problems are. So
    I'm very sympathetic, but I want to be candid. I think we've got a
    little work to do to bring the Congress to where we are.

    Banking and Community Development

        Mr. Hamilton. Mr. President, our next ques-

    [[Page 1210]]

    tion comes from Assemblywoman Gwen Moore of California, who is a
    majority whip of the California Assembly.

    [Ms. Moore asked if the President opposed efforts to preempt State laws
    related to interstate branch banking and community reinvestment.]

        The President. Let me first, if I might, make a comment in reference
    to the first thing you said about California, because we now have
    legislators from all over America there. I want to make it clear that I
    got hired by all the American people to revitalize the whole American
    economy. But we can't get there unless something is done about
    California.
        California has 12 percent of the country's population, 21 percent of
    the country's defense budget, took about almost 40 percent of the cuts
    in the last round of base closings, has taken a huge percentage of the
    cuts of defense cutbacks, and therefore is a net drag on the whole rest
    of the country when we have to pour money in for welfare, for food
    stamps, for unemployment, for maintenance programs, instead of having
    California do what it has done for much of the last 20 years, which is
    to lead the vibrant economic growth of America. So it is critical to all
    of you in the audience, whether you're from California or not, that
    something be done to deal with what is otherwise the world's sixth
    biggest economy.
        Now, to go back to your community development question. I'm from
    Arkansas; my people have an interest in this. Everybody does. Now, let
    me say about the community involvement issue, I believe strongly that
    the Federal Community Reinvestment Act should be easier to follow and
    more clearly enforced. There is a way that we can make it less
    bureaucratic and still more easily enforced.
        I believe that we ought to create partnerships, as you know, for
    community lending institutions all across America. There is clear
    evidence in the South Shore Bank in Chicago, in the Southern Development
    Bank in Arkansas, in the community initiatives in North Carolina and a
    lot of other places in this country, that you can make loans to poor
    people in distressed areas and make free enterprise work, create jobs,
    and move people from welfare to work. That clearly mostly is going to
    have to be done by people at the local level working in partnership with
    the bankers. Therefore, I do not see any need to preempt whatever State
    laws might be also adopted with regard to community investment
    priorities or initiatives.
        In terms of interstate banking, the other question you asked, that
    hasn't come up yet. I know of no reason that we would want to do that,
    and I certainly won't make any move or make any final decision on it
    without consulting you and the Governors and others at the State level
    who have an interest in this.
        Ms. Moore. Thank you very much.

    Health Care Reform

        Mr. Hamilton. Mr. President, our last question will be offered by
    Senator Don Wesely of Nebraska, who is chair of our assembly on the
    legislators.

    [Mr. Wesely asked when the President would announce his health care
    reform package and if it would allow States to continue experimenting
    with their own programs.]

        The President. We expect to come forward with a package after the
    budget passes, that Congress has made it clear that they do not want to
    deal with an issue as major as health care while the budget was still on
    the griddle.
        I think that it's also clear that we're going to be able to do far
    more at lower burden than had originally been assumed in terms of
    providing basic coverage for the unemployed, uninsured, locking in
    people to some coverage even if they have some preexisting health
    condition or someone in their family does, and promoting some
    significant insurance reforms and Government reforms to simplify the
    administrative costs.
        I think there needs to be a sort of baseline comprehensive care
    package that every American has access to. But I also believe the States
    should be left a considerable amount of freedom to experiment with
    whether they want to provide other services or alternative delivery
    networks or alternative financing systems. So I think you can look
    forward to seeing a fairly significant amount of State flexibility here.
        It's interesting, if you go back and look at the Canadian system,
    they've started that in one Province. We now have a lot of States trying
    different things. Hawaii, for many years, has provided some health
    insurance to virtually all their employees, although not all children
    were covered. But they did more sooner than anybody else. Now you've got
    Washington State, you've got Minnesota with new plans, you've got Ken-

    [[Page 1211]]

    tucky and Vermont with plans on the griddle, a lot of other things being
    considered. So I think we need to maintain the elbow room and the
    creativity of the States in solving some of these problems, but there
    needs to be enough of a framework so that no one fears being left out
    and so that there's enough systematic change to bring these cost
    increases down. We have got to get health care costs down closer to
    inflation, plus population growth, or we're never going to turn this
    economy around in the long run. We're spending 14 percent of our income
    on health care, and only one other nation in the world, Canada, is even
    over 9 percent of income, and they're just barely over.
        So we are going to have to have some uniformity, but I want the
    private system to remain in place, and I want as much flexibility for
    the States as possible.
        Mr. Wesely. Thank you, Mr. President.

    [Mr. Hamilton then thanked the President for participating in the
    program.]

        The President. God bless you, Art. Thank you all, and goodbye.

    Note: The President spoke at 5:10 p.m. in Room 459 of the Old Executive
    Office Building. A tape was not available for verification of the
    content of these remarks.