    [Public Papers of the Presidents of the United States: William J. Clinton (1993, Book I)]
    [February 21, 1993]
    [Pages 165-171]
    [From the U.S. Government Publishing Office www.gpo.gov]

    Remarks on the Economic Program in Santa Monica, California
    February 21, 1993

        The President. Thank you very much, President Moore, and ladies and
    gentlemen. This is a wonderful welcome on a Sunday afternoon, and I'm
    very grateful to you.
        I was honored to fly out here today with two of your Members of
    Congress: Congressman Waxman and his wife, I know we're in Henry's
    district, he's here; Senator Barbara Boxer and her husband down there.
    And I think we have four or five other Members of Congress here. Where
    are they all? Here they are, Maxine Waters, Jane Harman, Howard Berman.
        We have a lot of your State officials here and mayors. Mayor Bradley
    I think is here. He met me at the airport. I resent Mayor Bradley. He
    looks 10 years younger than me. [Laughter] I see a lot of my old friends
    here, a lot of members of your legislature. If I start introducing
    people I will never quit. But I do want to say a special word of
    appreciation to Speaker Willie Brown and Senator Roberti and those who
    invited me. They sponsored, along with Governor Wilson, that economic
    summit for California, and they invited me to call in, and I appreciate
    that. And I am glad to see--I have to say a few things--I see your
    Lieutenant Governor, Leo McCarthy; and March Fong Yu here, secretary of
    state; and Gray Davies, your comptroller; Tom Hayden and Diane Watson;
    and Yvonne Burke. I'm pretty good at this, don't you think? I mean, just
    for a guy who walked in. And I still think John Garamendi's health care
    plan may wind up being the model for what we do in the country. It's got
    a lot to recommend it. Is the Mayor of Santa Monica here? Judy Abdo,
    stand up here. How are you? And we're in Terry Friedman's district. Is
    he here? There he is. Marguerite Archie Hudson, is she here? That's
    right. And we've got a lot of L.A. council members here. I see several

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    here, Zev and others. Now we have--Santa Monica council.
        Now, I'm leading up to something here which is that I want to
    introduce two other people. One is a good friend of mine, someone who
    helped me with higher education issues in the transition, and one of
    America's most distinguished educators: Dr. Johnetta Cole, the president
    of Spelman College, is over here. Then I want to introduce someone who
    sort of played a hobo in my Inaugural gala and who makes me the second
    most famous person in the room, Mr. Bill Cosby, who just came in over
    here.
        Ladies and gentlemen, I wanted to come out to California, which was
    so good to me and to Al Gore, a State that did so much to give us a
    chance to serve and to try to turn our country around, to talk about the
    economic plan that I have presented to the Congress, the challenge that
    it presents to the country, and the help that all of us need from you to
    have any hope of its passage.
        I have embraced as my cause the idea that every person in this
    country ought to be able to live up to the fullest of their God-given
    potential. If it can happen anywhere, it must happen in California.
    Unless California is revived, the Nation cannot recover economically.
    And unless the people who live here in this State, indeed in this
    county, with all of its multiracial and multiethinic and multireligious
    implications, unless you can draw strength out of your diversity, the
    Nation cannot bring strength out of its diversity and out of the
    challenges we face today.
        The problems you have here are familiar to you and, I guess, to the
    rest of the country. But since we are here in an event that is not only
    in Santa Monica but that will beam out to the Nation, I think it is
    worth reaffirming that for so many years California led the country in
    economic growth and now is having difficulties for some reasons that
    affect every American.
        First of all, for two decades through the administrations of
    Democratic and Republican Presidents alike, the productivity rate of our
    country, the output per worker, has been slowing down. And that has led
    to diminished wages and more and more families being forced to have
    extra earners just to make ends meet. And some good things have
    happened. The enrollment at community colleges has exploded, simply
    because people recognize that they need more skills and they have to
    keep learning things over and over again. The average age here is now
    27. Fifteen years from now I predict to you the average age here will be
    about 35, just because people will have to keep learning for a lifetime,
    in a global economy in which what we earned is a function of what we can
    learn.
        But in addition to that, California has been especially hard hit by
    some other things: by reducing the defense budget, something we all
    celebrate as a move toward world peace at the end of cold war but
    something which has led to big dislocations, especially among high-wage
    factory workers, because our country began a few years ago to reduce
    defense with no plan to convert our massive human capital from producing
    instruments of war to using the technologies of peace to clean up the
    environment and to improve the quality of our lives and to go forward.
    And so we have to do that. But because we haven't, California suffers
    today.
        California suffers because all big operations in this country, and
    indeed to some extent throughout the world, are undergoing a massive
    reorganization. But for the last couple of years, as big companies lay
    off people, small companies are not hiring because of the credit crunch,
    the cost of health care, the lack of a market, things that we have to
    face everywhere but that have been particularly painful here.
        Finally, we find that a lot of the areas that are critical to our
    future, the high technologies of the future, are not being seized by
    this country because we don't have the partnership we need between the
    Government, business, and labor to break the barriers of the future. And
    other countries are doing better.
        After I leave this State tomorrow, I'm flying on to Washington State
    to meet with representatives of Boeing. Boeing just announced laying off
    23,000 workers. Now, part of that is defense cuts, but after all, Boeing
    makes a lot of other kinds of planes, too. And for the last several
    years, we have stood by while Europe invested $26 billion in taxpayer
    money to build the airbus to push American people out of work, not
    because they won any sort of free market competition but because Europe
    had a theory about how to get high-wage jobs going into the 21st century
    in aerospace. And we were in the grip of a theory that said, oh, that's
    industrial policy; we don't do that.
        So this whole part of our country, which has been the beacon of hope
    for decades for Americans, is now under great stress. And the eco-

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    nomic problems aggravate the underlying social difficulties that you
    find in every big city in America: more and more poor people, more and
    more single parent households, more and more children forgotten and left
    behind--things that we have to do.
        Overhanging all of this is the idea which has dominated our
    Government for the last 12 years, which is that if we just kept taxes
    low on the wealthiest Americans and got out of the way, the economy
    would flourish. Well, what has happened is that because we had a theory
    of Government nonintervention, the deficit has exploded as taxes were
    lowered on the wealthiest Americans, but health care costs exploded;
    interest on the debt exploded; the cost of Government continued to
    increase, and now I find myself being elected President, knowing we have
    to invest more in the new technologies of the future, knowing we have to
    invest more in helping people to convert from a defense base to a
    domestic economy, knowing we have to invest more in early childhood
    health problems and early childhood education and the education of our
    people, and knowing that we have a huge deficit that is going to be next
    year $50 billion bigger than we were told during the election. In
    December, the deficit numbers were revised upward $50 billion a year
    roughly for every year of my term.
        So here is the dilemma: We have to do something no Americans have
    had to do before. We have to increase investment in our people and our
    future and reduce our debt at the same time. And to do it, we have to
    make some difficult choices, some that are more difficult even than I
    thought during the campaign because the debt has gotten bigger. And yes,
    those choices carry a pricetag. But if I have one message to you today
    it is this: The price of doing the same old thing is far higher than the
    price of change. And that is why we have to have the courage to change.
        If we do not change, then the good things that are happening today
    will not translate into jobs and opportunity for America. Here's
    something good that is going on today. The productivity of American
    firms is rising at a rapid rate. All this global competition has forced
    many millions of our businesses to produce more with less and to
    generate more wealth. That's good. But it will only really be good if
    that money is then taken and invested in this country to put people to
    work or to raise people's wages.
        And if we don't do something about the cost of health care, if we
    don't do something about the productivity of the work force, if we don't
    do something to make America a better place to invest money to generate
    jobs, if we don't have incentives that say reinvest your money here and
    put our people to work, if we don't help people control their health
    care costs, then all that increased productivity may result in
    opportunities elsewhere, but it won't result in bringing America back to
    where it ought to be.
        If we don't change, if we just keep on doing what we've been doing
    for the last 8 or 12 years, by the end of the decade our Government's
    deficit will be over $650 billion a year. Over 20 cents of every dollar
    you pay in taxes will go to interest on the debt. About 65 cents of all
    the money you pay will go to entitlements in health care. The rest will
    go to defense. And every Member of Congress, all these people that I
    recognize, they'll be going to Washington to figure out how to spend 3
    or 4 cents on the dollar. Because they will be paralyzed because we
    refused at this moment to face up to our responsibilities to change this
    country. And I don't think you want that.
        If we keep on going like we've been going, by the end of the decade
    we'll be spending 20 percent of our income on health care, and yet,
    we'll have over 40 million of our people without any health insurance.
    We'll be spending twice as much by then as any country on Earth and have
    so much less to show for it because our Government refused to work with
    the people of this country to find a solution to the health care crisis.
    And so I say again, the price of doing the same old thing is a whole lot
    higher than the price of change.
        What I have challenged the Congress, Republicans as well as
    Democrats, to do, is to join me in this crusade for change. And I said I
    will set an example. We have to cut spending, raise taxes, and then
    increase investment, the things that will make people better able to
    live and grow this economy. We've got to do both: cut spending, raise
    taxes. And then we have to increase our investment in the things that
    will grow the economy.
        We should begin with the cuts. I set an example. I cut the staff of
    the White House by 25 percent below what my predecessor had. You know,
    it's one thing to talk like a conservative, and another thing altogether
    to live like one. And I'll tell you something, and I believe the

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    White House staff will work better. I believe it will be more efficient.
    I believe we will serve more people. And I believe we'll be able to do
    what needs to be done.
        We're going to cut $9 billion out of the administrative costs of the
    Federal Government. We're going to cut subsidies to programs, including
    some that I like that help people where I came from. I have recommended
    reducing the interest subsidies, for example, to the rural electric
    association. And that's something that's tough for me. I grew up in the
    South where a lot of my folks wouldn't have any electricity if it
    weren't for the REA. But most everybody's got electricity now, and I
    think it's fair to say we're going to cut spending across the board,
    they should bear a share of that cut.
        We're going to eliminate things that don't need to exist anymore,
    including a third of the Government commissions you're paying for. We
    celebrated the Bicentennial--listen to this--we celebrate the
    Bicentennial of the Constitution in 1987, right? Guess what? There's
    still a Constitutional Bicentennial Commission you're paying for--
    [laughter]--not to mention the Tea Tasters Board. Now, I say that not
    because there's a lot of money here, but when you add them all up, it's
    a whole lot of money. Not any one is a lot of money.
        We're going to cut some subsidies that I think ought to be cut. For
    example, the Superfund was held up as the salvation of the American
    people for environmental cleanup. But if you look at what's happened to
    it, it's operated as a big tax subsidy to people who have polluted, and
    yet most of the money in the Superfund is going to lawyers for lawsuits
    and legal fees instead of to clean up pollution. We're going to make
    people pay their fair share and use it to clean up pollution.
        I'll tell you something else that wasn't easy to meet or ask for. I
    know it's popular, and it's also the right thing to do under these
    circumstances, but I've asked all the Federal employees to take a freeze
    in pay for a year, and then for the next 3 years to have their pay
    increased by less than the cost of the living allowance they would
    otherwise get. And that will save billions of dollars.
        I have offered 150 specific spending cuts, 150. And these aren't
    gimmicks. These aren't the kind of things that we used to have where the
    President will say, ``Well, I just want to cap expenditures, and I'll
    let the Congress figure out how to distribute the pain.'' These are 150
    specific cuts. Now, that's not bad for 4 weeks on the job. I think we
    can do better. I think we can do better. But I think that what we ought
    to do is to do better and not talk about doing better. So I have
    challenged everybody who wants to say to me--every time I go someplace
    they say, ``Cut more, tax less.'' I say, ``Tell me where.'' Starting in
    the Congress, tell me where. I'll be glad to listen.
        Audience member. Star Wars.
        The President. Everything--everything. We did cut Star Wars quite a
    lot, as a matter of fact, a whole lot.
        I want you to know something else: I will not support a tax
    increase, even a tax increase, even a tax increase on the wealthiest 1.2
    percent of the American people, who are the only people whose rates are
    being raised, I won't support that until I know we have the spending
    cuts, too. I don't think anybody should pay more until we cut more.
        And I did ask a broad base of the American people to pay a modest
    energy tax, and I want to talk about that. I did it because the deficit
    was bigger than I thought and because I knew we had to bring down
    interest rates, and if we did, it would save money for the American
    people. And let me just tell you what's happened.
        Since the election, just since the election, since it was clear we
    were going to finally tackle this debt, interest rates have dropped
    seven-tenths of one percent. If every one of you--I want you to think
    about it--every one of you who has a variable interest rate on a home
    mortgage, a car payment, a credit card payment, you're going to make
    more money in the next year than you'll pay in this energy tax if we can
    keep the interest rates down. So it's good in the short run but it will
    also be good in the long run for America.
        But I want to talk a little about the energy tax, because that's
    what most of you will pay. People have been arguing for years that
    America ought to have a big increase in the gas tax, because we have the
    lowest gas tax in the world. Then they argue we ought to have a big
    increase in the carbon tax because we use a lot of coal, and that's
    polluting.
        I concluded that we shouldn't do either one of those because it
    wouldn't be fair to the American people. A carbon tax would hit those
    States with high unemployment in the East, like Ohio and West Virginia,
    where people earn their

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    livings in the coal mines that are around them. We've already got a
    tough Clean Air Act that's going to require them to pay more, and I
    didn't think that was fair. And I didn't want a big increase in the gas
    tax because I didn't think that was fair to people who lived in rural
    areas or people who had long commuting times and no options for mass
    transit. It's great if you live in the city and get on the subway every
    day, but if you have to drive to and from work and you drive long
    distances, it can be very burdensome.
        So we decided--and I might say I want to compliment him; the Vice
    President had a lot to do with this decision--that we ought to go with a
    Btu tax based on the health--excuse me, the heat component, the energy
    component of natural gas, of oil, and of coal, to spread it broadly
    across energy sources so that the whole thing would encourage
    conservation, would encourage renewable resources, would encourage less
    reliance on foreign oil, and would help us to bring down the debt. I
    think it is the fairest way to go, and it's a balanced thing to do.
        Let me say, having done that, I also believe there are some things
    we must spend more on, because the only reason for reducing the deficit
    is not just to prove you can bring it down but because it's better for
    the people of this country. And if we reduce the deficit, it means we
    spend more of your money on education and jobs and less paying interest
    on the debt. And if we reduce the debt, it means that you'll be able to
    borrow more money privately and at lower interest rates. But we still
    have to spend some more money, and let me tell you where. The first
    thing we need to do is to adopt a jumpstart program that I have
    recommended that will create a half a million jobs in this country to
    try to take advantage of this economic recovery with new jobs over the
    next year.
        The second thing we need to do is to focus closely on the cities and
    the problems they have with some specific efforts. And let me just
    mention a few. Our program will invest more money in the cities, in
    street projects, park projects, water projects, sewer projects,
    environmental cleaning projects. It will provide for the young people of
    this country who live in depressed areas, not just big cities but poor
    rural areas, 680,000 new summer jobs this summer, something that is
    needed here.
        I am going to challenge the business community to join with me to
    create more than a million new summer jobs this summer so we won't have
    to worry about what the kids are doing. If we give them something to say
    yes to, we won't have to spend so much time telling them to say no to
    things.
        We're also going to do some other things that we know work. There's
    been a lot of people talking about it. This budget, for the first time,
    fully funds the Head Start program that gives every child a chance to go
    to Head Start. It fully funds the nutrition program for women and infant
    children. It will give us the mechanism to immunize every child in this
    country against preventable childhood diseases.
        Now, there will be those who say, ``Well, just don't spend any new
    money.'' But let me say, we have been closing the barn door after the
    cow's out, as we say in my home State, for decades on these problems.
    You spend $1 on Head Start and WIC, you save $3 down the road in
    problems kids are going to have. If you spend $1 on childhood
    immunizations, you save $10 down the road in preventable childhood
    diseases. You tell me how we can defend having the finest pharmaceutical
    companies in the world in this country, still the richest on Earth, and
    yet, only Haiti and Bolivia have lower childhood immunization rates in
    this hemisphere than the United States. It's inexcusable, and we're
    going to change it. We can do better.
        Education works. And I intend to follow through on my pledge to make
    college loans available to all Americans based on their ability to repay
    when they take a job and giving a huge number of Americans the right to
    earn their way out of their college loan, either before or after they go
    to college, with national service as police officers or teachers or in
    community youth programs. These are the kinds of things that can turn
    this country around.
        Let me just mention two other things. The people of our country have
    elected politicians for years who have always talked tough about crime.
    It's sort of like being for motherhood and apple pie; you've got to be
    against crime. And I don't mean to trivialize this; no one is for crime.
    But there are some things, you know, that work. Drug treatment works.
    Jobs work. And there are law enforcement strategies that work. And
    unfortunately, most cities don't have enough money to implement them,
    because they require you to put police back in the same communities
    working with their neighbors. One part of our plan will put another
    100,000 police offi-

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    cers on the street in this country over the next 3 to 4 years, and that
    will make a difference.
        There are some things in this plan that will be especially good for
    this State, one of which is full funding of the Ryan White Act to care
    for people with AIDS. Another is that we will spend almost $5 billion
    over the next 4 years retraining workers and reinvesting in communities
    who have been hurt by defense closings. It's time to stop talking about
    conversion and start doing something about it.
        Last year the Congress--I have to say something to take up for your
    congressional delegation here--the United States Congress appropriated
    $1.7 billion for defense conversion, to go into communities that have
    been hurt, to educate people again who'd lost their jobs, to give
    communities incentives to find new kinds of peacetime investments to
    build for a better future. And the administration which preceded me
    released zero dollars of that $1.7 billion. I just talked to my Budget
    Director, Leon Panetta, who's up in northern California today, and
    confirmed that we will shortly release $500 million of that fund, a lot
    of which will go to the State of California to put people back to work.
        Today when I leave you, I'm going to northern California, and
    tomorrow morning there I will announce a new technology policy. And I
    don't want to go through all of it now, but just let me say this: One of
    the things that I'm proudest of about this budget is that we reinvest
    more money than we cut in defense research in domestic research. We are
    trying to find answers to the profound environmental difficulties we
    face today. We believe we can create jobs in saving America's
    environment and the global environment. We believe they can be created
    in the most sophisticated research and our most advanced labs that used
    to worry about how to find new ways to destroy massive populations. And
    we believe we can create them in the national forests of our country and
    throughout the land with reforestation projects to clean up the air and
    put people back to work, and in all manner of ways in between.
        I need your support for this program. The Members of Congress can
    only be expected to do what they think the people back home will stick
    by them in doing. We've got to cut spending. We've got to increase some
    taxes. We've got to invest some in America. We need an economic program
    that really recognizes that we live in a world where the capacity of our
    people and their ability to work together, their ability to learn new
    things, their ability to have access to investment capital, and their
    ability to live together so that they draw strength from one another is
    the critical element in our future. We cannot continue to go on with the
    kind of paralysis and division and just ignoring our problems that has
    ripped us for too long.
        Nobody wants to talk about half the things that I tried to deal with
    in this budget because they're too painful. But if only you worry about
    what's happening today and tomorrow, you never really look beyond that.
    And I tell you, this is a historic moment for us. We have an
    inordinately great opportunity to fashion a whole new future for America
    if we have the courage to seize it. But let me say to all of you, I want
    to make two points to every one of you here. And since so many of you
    here are students here, at least one of these will be preaching to the
    choir:
        Point number one, the President and the Congress, working with the
    people of this country, can create a framework of opportunity, but that
    is all. Seizing the opportunity depends upon the individual initiative
    of people in every community in this country. And making it really work
    depends upon decisions made by people at the grassroots level. You have
    to make these things work by taking advantage of them. If we pass these
    programs, for goodness sakes, seize them; make them work. Rededicate
    yourselves to the proposition that you'll do your part to solve the
    problems of your community and your country.
        The second point I plead with you to communicate to the Members of
    the House and the Senate is that you understand you can't just have the
    sweet parts of this program; you've got to have the tough parts too. You
    know, if you, for example, are feeling pretty good and you're in a
    business that's doing pretty well, it's easy for you to say, ``Well, the
    only thing I care about is the budget cuts. Just let them cut the
    budgets.'' Or if you're not doing very well, you might say, ``The only
    thing I care about is the spending increases and taxing those rich
    folks, because I don't have that kind of money.'' Or if you're sort of
    in the middle, you might say, ``I like the budget cuts and the taxes,
    but I don't want the spending. I'd just as soon have the deficit down,
    and then I wouldn't have to pay the energy taxes.'' In other words,
    every

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    one of you, if you look just at your own interests, could find one part
    of this program that is not in your interest today.
        So we have to ask ourselves the question I put to the Congress and
    to you, the American people, on Wednesday night. You can't just say,
    ``What's in it for me?'' You have to ask, ``What's in it for us?''
        Let me close with just this story. I left my wife and my daughter at
    the White House this morning, and I walked across the lawn to get on the
    helicopter to come to the plane to come out here, and it was snowing and
    cold. And I said, boy, am I glad to be in California, when I got off the
    plane. But at least it was 20 degrees or 30 or whatever it was this
    morning. But a couple of days ago, I got up in the morning in
    Chillicothe, Ohio, the first capital of the State of Ohio, and I went
    running in the city park with the Mayor. It was 3 degrees, 3. But all
    along the road coming in there, there were hundreds and hundreds of
    people standing out there in the dark when I'd come in the night before
    in 3-degree temperature, saying, ``We want our country back. We want our
    country to work again.''
        And then I flew to New York and I had a 50-minute drive to Franklin
    Roosevelt's home in Hyde Park, New York, where we went to a school that
    was built during the WPA which is still a functioning school, a
    beautiful school, proving that work is better than idleness when you can
    put people to work. And all along the way it was 8 degrees, and all
    along the way hundreds and hundreds of people along the way with their
    signs up. They weren't all friendly, but--[laughter]--and by the way,
    that's good, too. That's another thing we've done: People are debating
    these issues now and at least participating. But 9 out of 10, 9 out of
    10 of them were favorable. And there was this incredible sign standing
    there in the cold. I mean, 8 degrees; we were in single digits and out
    there on the highway. Nobody was going to stop--these people--and in the
    middle, there was this one guy on this sign that says, ``Do something.
    Just do something.'' [Laughter] Let's do something, and we'll all win.
        God bless you, and thank you.

    Note: The President spoke at 1:25 p.m. at Santa Monica College. In his
    remarks, he referred to Richard Moore, president of the college; David
    Roberti, president pro tempore, California State Senate; Willie Brown,
    speaker, California State Assembly; Lt. Gov. Leo McCarthy of California;
    March Fong Yu, California secretary of state; Tom Hayden and Diane
    Watson, California State senators; Yvonne Burke, former U.S.
    Representative; John Garamendi, California insurance commissioner; Terry
    B. Friedman and Marguerite Archie Hudson, California State Assembly
    representatives; and Zev Yaroslavsky, Los Angeles city councilman.