    [Public Papers of the Presidents of the United States: William J. Clinton (1993, Book I)]
    [February 5, 1993]
    [Pages 57-59]
    [From the U.S. Government Publishing Office www.gpo.gov]

    [[Page 57]]

    Remarks to the National Conference of Mayors
    February 5, 1993

        Let me say, first of all, welcome to the White House.
        Mayor Jackson, I saw your brother earlier today at the signing of
    the Family and Medical Leave Act, and he was bragging on you, said
    you're now as thin as he is. I assured him I would still be able to
    recognize you when I saw you. [Laughter]
        This has been a wonderful day here at the White House. Congress
    adjourned--[laughter]--but only after passing the Family and Medical
    Leave Act. We had a great signing this morning. It was a great
    bipartisan effort; about a third of the Republicans in the Senate voted
    for it. And it was a really good, good way to start the day.
        I'm glad you're here. I know you've been meeting with Secretary
    Cisneros, who's one of your own. There are times when we meet when I
    can't tell whether he's changed positions or not--[laughter]--which I
    suppose from your point of view is a good thing.
        Most of you in this room I know well. I've spent a lot of time in
    your communities, and you have played a major role in my political
    education. I assure you that I think every day about many of the places
    we've been and the things we've seen and the things that I have learned
    from you. I think that the time I spent in our country's cities in this
    last election, that was in many ways the most instructive time that I
    spent. And one of the things that impressed me so much is that so many
    things, against all the odds, are being done that work. And I want you
    to help me now figure out how to make those things that work the rule
    rather than the exception in American life.
        I told the Governors when they came in here and spent some time with
    me earlier this week on the subject of health care that if somebody
    asked me to name my greatest failing as a Governor after 12 years, it
    was that I never could quite figure out a way to make the exception the
    rule, to take those things that worked and make them work everywhere.
        In that connection, I have been working with Secretary Cisneros and
    have sent, after working it out with him, a directive to him today to
    deal with a number of specific things that I know are important to all
    of you:
        First, to establish a weekly mechanism for communication with the
    State and local leaders of our country on issues of housing and urban
    development. And I hope we'll have a chance to talk about both of them
    because they are related, but they aren't the same.
        Second, to try to expedite the programs that are already there now,
    to unclog some $6 billion that have been inexplicably tied up in the
    pipeline of the Federal Government that have already been appropriated;
    to speed up by 3 to 4 months the processing of the over $3 billion in
    public housing funds that are available and to try to accelerate the
    real implementation of the HOME Program where there's $2.5 billion in
    largely unmoved funds because the administrative system of this
    Department has been largely paralyzed.
        I told Henry when I asked him to take this position that there was
    some risk because of the pall which had been cast over HUD and the
    problems of past years and because there had been a lot of rhetoric but
    not enough action out of the Department in recent years. We're going to
    do what we can to marry rhetoric and action. We don't promise to shut
    up, but we promise to try to do some things.
        I also want to tell you that I'm going to do the best I can in this
    upcoming stimulus and economic package to do what I said I would do: to
    bring down the deficit but to increase investment at the same time in
    ways that will make available more funds for the cities.
        I remember, Mayor White, when we were in Cleveland with Congressman
    Stokes, you said you thought we ought to increase the community
    development block grant funds because you could move those more quickly
    to create jobs. And there will be a fairly sizable increase in that in
    the proposed stimulus package to try to help you create jobs.
        Let me just make a couple of general remarks about where we are on
    this whole economic approach, and then I'd like to hear from you, and
    I'd like to just be as informal and conversational as possible.
        The economic news is good but mixed and incomplete. That is,
    starting in the last quarter

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    we have begun to have two pieces of good economic news. One is that
    productivity is increasing, and that's good. Companies are making more
    money. They're figuring out how to compete in a tough international
    environment. Two is that there's a lot more economic activity around
    housing as low interest rates finally are letting millions of Americans
    refinance their home mortgages, others get into buying homes, and that's
    all been good.
        Then since the election, there have been two good pieces of economic
    news that I think the election can fairly claim some credit for. One is
    that consumer confidence started going up in November and exploded in
    December, and it's going to be strong in January. The second is that the
    financial markets generally are upbeat about the direction that our
    administration has outlined, which means they take us seriously that
    we're going to try to do what many say is impossible, which is to
    increase investment and reduce the debt at the same time.
        So, that's the good news. The bad news is that in this economy, the
    downsizing of big firms is continuing apace. It started in the 1980's,
    when every year of the 1980's the Fortune 500 together reduced
    employment in the United States by about 400,000 people per year, big,
    big reductions in employment. In most years, that was offset by job
    increases in small and medium-sized companies. Now that is not
    happening, even though this recovery is in place. So you have this
    strange thing where the economic indicators are going up in the last
    quarter like crazy, but the unemployment rate is higher than it was at
    the depth of the recession. And for 14 months we've had a national
    unemployment rate over 7 percent. Why is that?
        I think there are several reasons, but let me just say there are
    plainly three. One is that small business cannot afford to hire new
    workers and make up the slack from big business cuts because of the
    exploding costs of health care. Two is that the small businesses that
    want to hire workers can't get credit because of the credit crunch,
    which is more heavily concentrated in some places than others and
    particularly in California and southern Florida--Mayor Lanier, still in
    Texas--but generally across the country. The third is that the defense
    cutbacks have accelerated the loss of high-wage manufacturing jobs
    without any offsetting industrial strategy or conversion strategy in
    America, which has been particularly devastating for southern
    California, for Connecticut, and for one or two other places, but has
    been generally felt across the country.
        So the first thing I've got to try to figure out how to do is how to
    keep this economic recovery with all these big numbers going but to
    actually help real people out of it. How are we going to generate some
    more jobs? One way is to put some more money into basic construction,
    which would affect you. We're going to try to accelerate the funding of
    ISTEA, which would help you. We're going to try to put some money into
    this stimulus package. It will be modest because we don't want to be
    accused of ignoring the economic indicators, but it will be substantial
    to several areas.
        And the other is to outline a 5-year investment plan which will
    increase our investment in infrastructure, which will have a defense
    conversion plan, and which will attempt to address these very serious
    problems that are killing small business, namely controlling health
    costs and providing basic health care to all Americans and trying to
    break open the credit crunch.
        If you think about it, two best things I could do for you are both
    indirect. If we could bring health costs in line with inflation and get
    banks to lending again, economic activity would pick up among people who
    would then pay taxes to your local government, and you could take that
    money and do what you need to do.
        The best thing I could do for the private sector, if we could bring
    health costs in line with inflation between now and the year 2000, we
    would save the private sector 2\1/2\ times as much as the public purse,
    freeing hundreds of billions of dollars a year to be reinvested in the
    economies of this country.
        So, what I'm going to try to do is just that. It's never been done
    before in this country, having to bring down the deficit and increase
    investment at the same time. It's going to require some very tough
    choices. I spent 2 hours yesterday trying to cut the budget in areas
    that I thought were inessential in order to free up monies that would be
    invested. And obviously most of our investment money goes directly back
    to State and local government.
        I'm sure that a lot of you will wish we were spending more. But let
    me say that it is critical, I'm convinced, that we show some discipline
    in bringing down this deficit, because every point we drop long-term
    interest rates frees up $50 billion for new investment in this economy.

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        So I'm going to try to spend more in terms of investment and reduce
    the deficit, which means I'm going to have to cut consumption even more.
    And we're working on it. And I hope that we can work together closely,
    and we can do a very good job together.
        One of the things that I've been impressed with--Secretary Cisneros'
    work over at the Department--is he came back saying what a lot of our
    Secretaries have said. He said, ``This thing's not working very well
    when we've got all this money out there that's not even being spent.''
    We've got $6 billion in the pipeline. We got $3.1 billion that's been
    approved that's going to take 4 months too long to get out there. We've
    got this HOME Program; nobody can access the money because of the
    administrative problems. So, we can keep you busy for a year or so if we
    just run the Department right. And we're going to do our best to do
    that.
        I think the floor is now yours. Thank you.

    Note: The President spoke at 3:26 p.m. in the State Dining Room at the
    White House. In his remarks, he referred to Mayor Maynard Jackson of
    Atlanta, GA, and Mayor Bob Lanier of Houston, TX.