    [Public Papers of the Presidents of the United States: William J. Clinton (1994, Book II)]
    [October 24, 1994]
    [Pages 1852-1862]
    [From the U.S. Government Publishing Office www.gpo.gov]

    Remarks and a Question-and-Answer Session at the Cleveland City Club
    October 24, 1994

        The President. Thank you. It's kind of nice to be out of Washington.
    And it's very nice to be back here for my third appearance. On the way
    in I told Steve, I said, ``Shoot, if I show up again, you're going to
    have to start charging me dues.'' He said, ``You've forgotten Senator
    Metzenbaum's already paid your dues.'' [Laughter] So I thank you,
    Senator, for paying my dues.
        I'm glad to be joined here by so many guests and especially by some
    of your distinguished political leaders. I want to thank Howard
    Metzenbaum, as he leaves the Senate, for the things he's done for Ohio
    and for the United States over the years.
        This is not what I came to talk about, but I want to mention in
    particular a bill that he got into the very last set of bills that
    passed in the filibuster-wild Senate at the end of the session. It's a
    bill that has achieved, finally, some long overdue national notice, to
    make it easier for parents to adopt children and to make it easier to
    get these kids out of long-term interminable delays in foster homes and
    into solid adoptive homes. And it's a great contribution to what I think
    ought to be the pro-family position of the United States of America. I
    thank you for that, sir. It was great.
        I'm glad to be here with Senator Glenn and Congressman Fingerhut,
    Congressman Stokes, Congressman Sawyer, Congressman Hoke. Former
    Congressman Mary Rose Oakar is here and as an Arab-American is going to
    the Middle East with the American delegation. I'm glad to see you here.
    Mayor White, I thank you for meeting me at the airport last night at
    midnight. I thought, now, there is a guy who is leaving no stone
    unturned. I thought Cleveland already had all the Federal money the law
    allowed, and there was Mike at the airport at midnight. [Laughter]
        Your ex-treasurer, our new Treasurer, Mary Ellen Withrow is here.
    [Applause] Thank you. The only person happier than I was when Mary Ellen
    Withrow was appointed was Lloyd Bentsen, the Secretary of the Treasury,
    because you can't print a new dollar bill until you've got a Treasurer,
    and he didn't have his name on any dollar bills. So after Mary Ellen was
    confirmed, Lloyd Bentsen sent me the first dollar bill with his name on
    it and with her name on it, which is framed in the White House.
        I'm glad to see my friend Joel Hyatt here, and so many other friends
    of mine here in Ohio. I thank you for coming.
        Eighteen months ago I had the privilege of speaking here at your
    club and outlining our economic programs to get the economy moving
    again. That was on May 10th of 1993. Ninety days after I spoke to this
    distinguished gathering, Congress passed that economic program by a
    landslide, you may remember, one vote in both Houses. [Laughter] As the
    Vice President always says, he's the most successful member of my
    administration; whenever he votes, we win. [Laughter]
        Today I wanted to come back here to discuss with you the progress
    that's been made and what we still have to do and the decisions that lie
    before you as citizens of this great country. We have made an important
    beginning with a comprehensive economic strategy designed to empower
    American workers to compete and win in the 21st century. That is, after
    all, our mission.
        The key elements of the strategy are simple and direct and
    important: First, reduce the deficit; second, expand trade and intensify
    the efforts of the United States Government to be a partner with
    American business in doing business beyond our borders; third, increase
    our investment in education and training, in technology and defense
    conversion; fourth, bring the benefits of free enterprise to areas which
    have been isolated from it, in our inner cities and rural areas, with
    new strategies, including but

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    not limited to welfare reform; fifth, reinvent the Federal Government,
    make it smaller, more effective, less regulatory, more efficient.
        These strategies have all been implemented. And I want to go through
    them point by point, but I want to say what is clearly obvious. The
    implementation of these strategies required a reversal of the policies
    of the past 12 years. It required much more aggressive, innovative
    partnership with the private sector. We recognized that Government's
    role cannot be either to save the economy, because we don't have the
    capacity to do that in the global economy, or to sit on the sidelines
    but instead to do everything we can to create the right climate, the
    right conditions and to empower people so that they can compete and win
    by taking responsibility for themselves and their families. The
    increasing changes in the world make this imperative.
        The course of the last 21 months is very different from the previous
    course, as I have said, and one of the great questions in this election
    season is whether we will press on this course or return to the course
    we abandoned just 21 months ago, a course with easy promises and
    superficial attraction but which is a proven failure. We cannot afford
    to bankrupt the country when we need to invest and grow the economy.
        Let's look at the record. Business leaders here and all around the
    country understand that a nation, like any successful enterprise, needs
    a clear mission, a strategy to achieve the mission, the determination
    and the patience to implement the strategy, and a willingness to look at
    the bottom line, to measure success and failure and to make adjustments
    as indicated by results. The mission is clear, to empower the American
    people to compete and win. The strategy is sound; I just outlined it. We
    clearly have pursued it with determination, and the bottom line is
    getting stronger every day.
        Let's look at the elements of the strategy, starting with the
    national deficit. You all know that the deficit exploded in the 1980's
    and that the aggregate debt of the United States quadrupled in only 12
    years from what had been accumulated in the previous 190-plus years.
        Last year we began to change that. We passed huge reductions in
    Federal spending, cuts in over 300 Federal programs, outright
    eliminations in scores of programs, a 5-year freeze on domestic
    discretionary spending, restrictions on entitlements. In the budget I
    just signed we not only reduced defense spending, we reduced
    discretionary domestic spending for the first time in 25 years.
        The Congress enacted the reinventing Government program in which the
    Vice President has taken such a lead and in which we committed to reduce
    the size of the Federal Government by 272,000 over a 6-year period,
    bringing the Government to its smallest size since President Kennedy
    served in this office. Already there are more than 70,000 fewer people
    working for the Federal Government than there were on the day I became
    President. One hundred percent of this money is going to help you and
    people like you all over America fight crime at the grassroots level.
    That is how the crime bill is paid for. That is how we are going to
    increase the police forces of this country by 20 percent, build another
    100,000 jail cells for serious offenders to enforce the tougher
    penalties in the bill, and pay for the preventive strategies that the
    law enforcement officers and the community leaders and the mayors say
    will work, not by increasing the deficit, not by raising taxes but by
    shrinking the Government.
        One other part of this strategy that I think is terribly important,
    especially in Ohio, to mention is the procurement reforms. The United
    States spends about $200 billion a year buying goods and services under
    rules and regulations that would give anybody a headache. It was the
    rules and regulations, not outright venality, which caused the famous
    stories you've all heard of the $500 hammer and the $50 ashtray, rules
    and regulations which literally added $50 to every Government purchase
    that cost $2,500 or less--$50. If it was a $50 purchase, it cost $100.
    If it was a $1,000 purchase, it cost $1,050. After years of haggling
    about it, we have finally passed procurement reform which will save
    hundreds of millions of dollars a year and put an end to the policies
    which brought us the $500 hammers, thanks largely to the leadership of
    Senator John Glenn, and I thank him for that.
        Well, all this has led to deficit reduction. When I spoke here last
    year the Federal deficit for 1994, the fiscal year that ended on the
    last day of September, was estimated to be $305 billion. Today the
    Treasury has announced its preliminary estimate, $203 billion, $102
    billion less than was projected before the plan was passed. The decline
    in the deficit since 1992 is the largest 2-year decline in our history
    and

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    the first time in 20 years the deficit has gone down for 2 years in a
    row.
        Let me go over here and try to illustrate what this means, and I
    hope this microphone works. It does. That's the technology wizards in
    our administration having their way.
        So you can get a feel for this, the deficit, which was very small in
    1979, began going up dramatically. It was at about $60 billion, or $65
    billion in 1980, and then it began really rising. It had gone to $220
    billion by 1990; you see where it was in 1992. Our budget took quite a
    bit off of it last year. And what these figures mean is that now we are
    drawing the line on the deficit down to $200 billion, a dramatic change.
        So you can get an idea of the difference, if we hadn't passed that
    deficit reduction plan last year, the deficit would have been off the
    charts, up here at $305 billion. And because we did, next year it will
    be off the charts down here at about $170 billion. And when that
    happens, it will be the first time that the deficit's gone down 3 years
    in a row since Harry Truman was the President of the United States. The
    Congress deserves credit for doing this and helping to lift a burden of
    debt from our children and helping to free up funds that would otherwise
    have been consumed in financing Government debt to finance homes and
    businesses all across the United States.
        The second thing I want to emphasize is that the remarkable thing
    about this budget is that while reducing the deficit and reducing
    spending, we have actually been able to increase our investments in
    education and training and technology. We increased Head Start. We
    increased funds to help all States develop apprenticeship training
    programs for young people who don't go to college but do want to get
    good jobs. With the new individual education accounts that I announced
    on Friday, we are reorganizing the college loan program to provide lower
    interest loans, lower fees on the loans, longer repayment options for
    young people who get jobs when they get out of college with modest wages
    and should not have to pay more than a certain percentage of their
    income. Over the next few years, this will make 20 million Americans,
    including almost a million in Ohio, eligible for lower interest, longer
    term repayment on their college loans. At a time when what you earn
    depends upon what you can learn, these investments are very, very
    important for the economic future of the entire United States.
        In addition to that, we have increased our investments in defense
    conversion, including in several sites here in Ohio. This is especially
    important because defense has come down rather dramatically since 1987,
    and we had built a huge high-wage, high-tech infrastructure around the
    defense industries that can make a major contribution to our moving into
    the 21st century if we have the kind of partnerships to help them make
    the transition.
        The third thing we did was to expand trade and to intensify
    America's efforts to promote the sales of American products. We passed
    NAFTA. We negotiated a new trade deal with Japan which has opened
    markets for everything from cellular telephones to American rice and
    apples for the first time. We have negotiated the GATT agreement. And I
    believe Congress will pass it after the election when they come back in
    a special session to do that. That will add $100 to $200 billion a year
    to the gross national product of the United States.
        We've also changed the time when the American Government thought
    that it should be totally passive in helping American companies pierce
    foreign markets when other governments were doing everything they could
    to help their companies do the same. We've worked hard from Saudi Arabia
    to South Africa to China to open up contracts for American businesses
    that they can win on the merits.
        The fourth thing I mentioned I want to take a minute of time to talk
    about because it relates to the kind of things that Mayor White has
    tried to do here in Cleveland. We know that even as the economy grows,
    there are pockets of our country that have not been affected by the
    economic recovery, where investment has not come, where jobs have not
    come, where people are still despondent, places where free enterprise
    has not reached. This is true, by the way, in every advanced country,
    but it's more true in the United States, in our inner cities and in some
    of our isolated rural areas. What are we to do about it?
        The first thing we have to try to do is to change the job mix, keep
    getting more good jobs here, which we're doing. The second thing we want
    to do is to try to provide special incentives for people to invest in
    isolated areas, the empowerment zones, the enterprise community concept,
    all of which offer incentives for people

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    to put their money into areas that are otherwise not so attractive. You
    know, for years we've had special incentives for our business people to
    invest in the Caribbean. I don't quarrel with that, but we ought to have
    the same sort of advantages for people who invest in places in the
    United States that have no jobs and no hope and no future.
        I signed a bill not very long ago that will set up a network across
    the country of community development banks, modeled on successful
    experiments in Chicago and even in rural areas in our country and in
    other parts of the world, to make small loans to lower income people at
    a profit to generate capital in areas that otherwise don't have it.
    There are markets all across this country in areas where people live but
    there aren't very many jobs. And we need to bring capital investment to
    development banks there.
        The last thing I'd like to say is, we've tried to make Government a
    better partner with deregulation of banking and trucking and exports of
    high-tech products and by just having our Government work better. The
    Small Business Administration when I took office was, for most small
    business people, kind of a bureaucratic pain. We have reorganized it now
    so that the loan applications are one page long and you're supposed to
    get an answer, yes or no, if you put the documents in, within 72 hours.
    That's the kind of service the American people ought to get if we're
    going to have an agency of that kind.
        Now, this strategy of ours has a lot of critics. When the deficit
    reduction plan passed, there were speech after speech after speech
    saying, ``Gosh, if we do this the economy will collapse; the deficit
    will explode; middle class taxpayers will be bankrupted. This will be
    the end of the world.'' I heard it all. Then when NAFTA passed, we had a
    different set of critics who said there would be a giant sucking sound--
    I think that was his phrase--[laughter]--do you all remember that?--to
    destroy our industry. Well, the economic program passed, and jobs went
    up, and the deficit went down. Middle class families did not have their
    tax rates hiked. The wealthiest Americans and corporations with incomes
    of over $10 million did, but all the money went to deficit reduction.
    And we built a new partnership with business by things like deregulation
    of banking and deregulation of intrastates trucking, which saves
    billions of dollars a year which then can be freed up to invest in this
    economy.
        Since NAFTA passed, exports to Mexico are up 21 percent. The Big
    Three automakers report their exports are up 500 percent to Mexico.
    NAFTA isn't a year old, and I just got back from Detroit where the
    biggest problem in Detroit is now complaints by autoworkers working
    overtime. That is a high-class problem.
        So that's the strategy; that's what we've done. What are the
    results? We are in the midst of the first investment-led, low-inflation,
    productivity-driven economic expansion in over three decades. New
    businesses are up. Exports are up. Jobs are growing. The deficit is
    falling. In the last 21 months there have been 4.6 million new jobs in
    the American economy, 90 percent of them in the private sector. In 1994
    something perhaps more fundamental and important has finally begun to
    happen. More than half the new jobs created by our economy in this year
    are above average wage, more high-wage jobs in this year than in the
    previous 5 years combined. And that is good news for the American
    working people.
        Investment in new equipment is 8 times what it was in the last 4
    years. And the Federal Government's purchases are down almost 8 percent.
    This is not a Government-inspired, deficit-driven recovery. This is more
    enterprise and less Government, better for the long run.
        For the first time since 1979 America leads the world in the sales
    of automobiles. For the first time in a decade we've had 9 months of
    manufacturing job growth in a row. For the first time in 9 years the
    annual vote of international economists said America, not Japan, was the
    most productive economy in the entire world.
        Now, you might say, if all that's so, why aren't we happier?
    [Laughter] Well, partly because the atmosphere in which we operate today
    is particularly contentious and, I believe, entirely too partisan.
    Partly because the way we get our information guarantees that we'll know
    more about our failures than our successes, guarantees that we'll know
    more about our conflicts than when we cooperate. Partly because we're
    dealing with long-term problems that haven't really affected a lot of
    real people's lives yet.
        If you look at the problems of crime, violence, family breakdown,
    drugs, gangs, and guns, they are a complex of social problems that have
    been developing over 30 years. You can't just wipe

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    away their reality in a few months. If you look at the economic
    anxieties of people--average hourly wages in this country actually
    peaked about 20 years ago, and working people have been losing their
    health insurance steadily for about 10 years, the only advanced country
    in the world where this is the case. Another million Americans in
    working families lost their health insurance last year. So there are
    real reasons that a lot of hard-working Americans don't feel more secure
    or more happy with good statistics and growth rates. They're still not
    sure that guarantees them a good future and a good job, the ability to
    keep their kids' health insurance or put aside money for their college
    education. They're still not sure that we're going to be able to solve a
    lot of the problems that violate our values and our conscience in our
    society. They're still not sure that they're going to be able to achieve
    the American dream or that their children will be able to.
        I want to say to you, the only way to do that is to keep facing our
    problems and facing our challenges and moving into the future with a
    strategy we know has the best chance to work and to resist easy
    promises, quick fixes, and things that have already caused us trouble in
    the past. The realities of the modern world are that the economy is so
    globalized and change is so institutionalized that no government of any
    nation can promise to protect people from the changes of the world
    economy. You can't make the world go away, to use the phrase from the
    old song. You cannot do that.
        So if change is inevitable and if we will never have a single
    economy anymore--we'll have a local economy in Cleveland and a State
    economy in Ohio and a regional economy in the Middle West and a national
    economy in America and a global economy in the whole world--if that is
    the reality, then what do we have to do? We have to facilitate people
    making the changes that will make change our friend and not our enemy,
    that will make change a source of security for us, not a source of
    insecurity. And we have to do it in a way that promotes those
    institutions of society that are most important to us, principally our
    families and our communities.
        Companies are making changes like this all the time. And the
    changing nature of work is placing enormous demands on working people.
    The average worker today in every kind of work has to be able to work
    with more information, to be more creative, to solve more problems on
    his or her own initiative. We have to see more responsibility being
    devolved down to workers at the grassroots level. And they have to learn
    more skills and information than ever before because the average worker
    will change jobs six or seven times in a lifetime, even if he or she
    stays with the same firm. This is the law of change with which we all
    will live and which we will either use to help make us more prosperous
    or walk away from and pay the penalty.
        Since every American has to face these forces, and every American
    family does, the job of the Government ought to be to try to empower
    people to make the most of them.
        A family can't treat these problems just like a business can. You
    know, if a family's under economic stress, you can't divest yourself,
    although some people with teenagers would like to from time to time.
    [Laughter] You can't really downsize. You can't restructure. I mean,
    you're sort of stuck with who shows up at the dinner table at night.
    [Laughter]
        So when the family is under economic stress, what are their options?
    You either have to learn and to become more productive or get a better
    job or you face increased competition by hunkering down, working harder
    for less, and just trying to be as tough as the times are.
        Now, that is what has happened to millions and millions of American
    families for the last 20 years, that latter alternative, working harder
    for less. The average working family is spending more hours at work
    today than 25 years ago for about the same hourly wages, adjusted for
    inflation. When working families are doing everything they can and small
    business people are and they lose their health insurance or their health
    insurance deductibles are so high that all they really have is the
    insurance that if they get sick they won't lose their home, it's tough
    on them. It's hard to maintain the sense of security and optimism that a
    country like ours needs to lead the world into the future and to keep
    our own dreams alive.
        So what are we are going to do about that? Well, we need more pro-
    family policies, like family and medical leave. We need to pass welfare
    reform that enables people to move from welfare to work, to be
    successful parents and successful workers. And we can do that. I sent a
    bill to the Congress last spring. We've given 19 States permission to
    get out from under all

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    the crazy Federal rules that keep them from moving people into the
    workplace. And we're going to pass it next year.
        We need to set up a national network of these manufacturing
    extension centers, like the Great Lakes Manufacturing Technology Center
    here in Cleveland, to help small firms to accommodate new challenges, to
    compete, and to get new technologies. We need to pass the
    telecommunications reform bill which died at the end of this Congress,
    which will help us to get along that information superhighway and
    provide unbelievable numbers of high-wage jobs for our people.
        We need to reform our job training programs, especially our
    unemployment system, and transform it into a reemployment system. We are
    still stuck with the same unemployment program we've had for 40 years.
    It's not fair to working people, but it's not fair to employers either
    to pay a FUTA tax which you pay to somebody when they're unemployed so
    that they have enough money to get along on. It's less than they were
    making at work but more than they'd be making on welfare. The whole
    assumption is they're going to be called back to work. Eighty percent of
    the people who lose their jobs today don't get called back to their old
    jobs. We are stuck with the 1950's system, when we need one for the 21st
    century that will encourage continuous retraining and placement in the
    work force. So these are some of the things that we have to do.
        Let me just say one last word about health care. By the time the
    people who like the system the way it is got through spending between
    $200 and $300 million to convince the rest of you that I was trying to
    have the Government take over your health care and take away your choice
    of doctors, you didn't like my plan too much. That didn't happen to be
    what I was trying to do, but there was nothing I could do to stand
    against that.
        Here is the problem that we'll have to face. No country in the world
    spends more than 10 percent of its income on health care except us. We
    spend 14 percent. That is $260 billion more than the other most
    expensive system in the world. Now, if we were just buying better health
    care, who would complain? The problem is no other advanced economy in
    the world--the other countries that are about as rich as we are, they
    cover everybody. Their costs are more nearly in line with inflation, and
    people don't lose their health care when they move from job to job, all
    of which happens here.
        I will say again, the 1,100,000 people who lost their health
    insurance last year, almost all were in working families. They weren't
    people who were on welfare; they were in working families. So we have to
    find a way that you folks can accept and feel comfortable with that lets
    you keep what you've got if you've got it and you like it, gives people
    the security that they won't lose their health insurance when they
    change jobs or if they happen to have a baby born with an illness, and
    still brings costs in line with inflation and provides coverage to the
    people who don't have coverage now, 85 percent of whom are workers.
    We've got to find some way to do that.
        Now, keep in mind, we have reduced defense about all we can. We have
    reduced domestic spending for the first time in 25 years. The only thing
    driving the Federal deficit now is Medicare and Medicaid costs going up
    at 3 times the rate of inflation. This is a serious problem. We'll have
    to face it.
        Now, having said all that, I hope that you are optimistic about the
    future. I hope that you will make a decision in these coming elections
    that is consistent with keeping on this course, because it is working.
        This is not necessarily a partisan issue. There are a lot of
    Republicans who have good, serious ideas for how we keep bringing the
    deficit down and be discriminating about what we invest in. But I don't
    think this contract is a good idea because it promises everybody a tax
    cut, it promises a defense increase, promises to revive Star Wars, and
    promises to balance the budget. Now, that will indulge the present
    instead of preparing for the future. It will cut college loans
    explicitly, when we ought to be educating more people. It won't reduce
    the deficit; it will explode it. But it sounds good; it's a trillion
    dollars in promises. We're just 2 weeks away from the election. After
    all I've been through, I'd love to make you a trillion dollars' worth of
    promises. I could show everybody here a good time on that. [Laughter] We
    could have a good time. But it wouldn't be the responsible thing to do.
        The responsible thing to do is to take your licks and say, look for
    the long run. Look for the long run. You know, I know people are
    frustrated and angry. One of the first things that every parent learns
    to try to teach your children is not to make decisions based on frus-

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    tration and anger but to make decisions based on what you really know,
    when you're thinking, is best for the present and for the future.
        So I ask you to think about this. We have made a substantial start
    at building the kind of America that will be strong in the 21st century.
    There are reasons for Americans to still feel uncertain and worried. But
    the reasons can be addressed only if we keep going forward, not if we go
    back.
        And the last thing I want to say is this--[applause]--thank you.
    Sometimes we have to see ourselves as others see us. Sometimes where you
    get discouraged or so caught up in the day-to-day business that it's
    hard to make our contract with the future, our commitment to the long
    run, our covenant to revive the American dream, we need to remember how
    other people see us.
        Other people think, folks, this is a pretty great country. It's no
    accident that when they want to have elections in South Africa, they ask
    us to come help put them on, or when after hundreds of years of fighting
    in Northern Ireland, they want the United States to bring people here
    who are on opposite sides and let them come to America and see people
    who share their roots and try to work through this. It's no accident
    that when Saddam Hussein reared up again in the Gulf, the countries
    there that want to be free look to the United States for quick
    leadership. It's no accident that in the Middle East, it was the United
    States that was asked to witness this historic peace agreement between
    Israel and Jordan. That is not an accident. It was no accident. If you
    could have looked into the eyes of those young men and women we sent to
    Haiti in uniform when President Aristide went back and all the Haitian
    people had those signs in Creole saying ``Thank you, America''--they
    know, other people know, this is a very great country.
        It is our job to build on that greatness, even when it requires
    difficult decisions and looking toward tomorrow and not giving in to the
    easy path today. That is what is before us. And I believe that today you
    can see that we are a very different place than we were 21 months ago.
    We're in better shape than we were 18 months ago. We are going in the
    right direction. We should stay on this economic course and make it a
    bipartisan commitment to a strong America and a global economy that
    keeps the American dream alive into the next century.
        Thank you very much.
        Steve Smith. Thank you, President Clinton. We now turn to our
    traditional question-and-answer period, a long tradition of the City
    Club. But because there were so many members who wished to ask questions
    today, we selected questioners by lottery a few minutes before the
    President arrived. In front of this audience, in fact, the names were
    drawn.
        The questions, however, have not been submitted either to the
    President or to the City Club in advance. We'll both be hearing them for
    the first time. Please, those of you who are asking questions, please
    remember that President Clinton is the only one authorized to give a
    speech today so be sure your questions are, in fact, succinct questions.
    [Laughter]
        And President Clinton, if you'll come back up here, I want to tell
    you that our membership director handed me a note while you were
    speaking, indicating that your renewal for City Club membership is now
    due. [Laughter] First question.

    Republican Contract With America

        Representative Martin R. Hoke. Mr. President, my question is about
    the Republican Contract With America which includes several of the same
    proposals that you campaigned for 2 years ago, like the line-item veto,
    a middle class tax cut, requiring welfare recipients to work. But you
    have called this contract, on at least a half a dozen occasions, a
    contract on America. Your advisers may think that this is cute rhetoric,
    but I think it's outrageous because as one of its signers----
        Audience members. Boo-o-o!
        The President. Let him finish. Let him finish. He wanted to do this;
    let him finish.
        Representative Hoke. Thank you, Mr. President. [Laughter] Because as
    one of its signers, your suggestion that I would take out a contract on
    my constituents is a suggestion that I take very, very personally. My
    question is this: At a time when the public is so concerned about
    violent crime, why would you resort to using such talk, in such an
    inflammatory way, especially when you have spoken yourself saying that
    you personally want to reduce the amount of partisanship in the debate?
        Audience member. Ignore him.
        The President. No, I don't want to ignore him. First of all, I agree
    with the line-item veto. I agree that we still should have some tax
    relief

    [[Page 1859]]

    for middle class taxpayers. The earned-income tax credit relief that we
    provided went to 15 million middle class families, including a half a
    million families in Ohio--10 times as many people here as got a tax
    increase--and it went up to $27,000. I think we should do more; I agree
    with that. There are some things in there I agree with. I certainly
    agree with welfare reform.
        And so I do agree with that. What I do not agree with is saying,
    ``Put us in control, and we will cut everybody's taxes, balance the
    budget, increase defense, and increase Star Wars. And we'll tell you how
    we're going to do it after the election.'' That's what I don't agree
    with. And I do think that's a contract on our future.
        And let me say this. And you may think that partisan rhetoric is
    rough, but I see Mr. Fingerhut over there. It was the Republicans, not
    the Democrats, that killed lobby reform and campaign finance reform in
    the last week of the session. And I appreciate your concern about crime
    and violence. I wish you hadn't voted against the Brady bill and the
    crime bill.
        Q. Mr. President, it's an honor to be able to ask a question of the
    President of the United States. You have indicated your dislike for the
    Contract With America. In particular, what do you dislike about the
    balanced budget amendment, requiring welfare recipients to work, a
    middle class tax credit, or reducing the size of Government, which all
    American people want?
        The President. Okay. Stand there. Let's go through them all. First
    of all, I proposed welfare reform not all that different from the
    Republican plan. My bill was there, been in the Congress since March.
        Secondly, I'm strong for the line-item veto, and I recognize that
    some members in my party in the Senate prohibited it from passing, and
    I'm going to do everything I can to pass it. I've always been for it.
        Thirdly, I believe that we should do more to provide tax relief to
    middle class families, especially with children, although I would remind
    you that we did provide substantial relief last time with no help from
    members of the other party. And--wait a minute--70 percent of the tax
    relief in the contract goes to upper income people.
        But my fundamental problem is how it all fits together. On the
    balanced budget amendment, I've lived under a balanced budget amendment.
    The problem with the way the balanced--it depends on how it's written.
    But no matter how it's written you've still got to lower the deficit, I
    mean--and cut the size of Government. It was the Democrats, we've cut
    the size of the Government. When the Republicans were in, they didn't
    cut the size of the Government. The Federal Government has 70,000 fewer
    people working for it today than it does on the day I became President.
    It's going to have 270,000 fewer people working over a 6-year period. It
    will be the smallest Federal Government since Kennedy. We are shrinking
    the Federal Government. We are doing that, and we are doing it in a good
    way. So yes, I'm for that.
        And insofar as those ideas are in there, I am fine on them. But here
    is the problem. My problem is it doesn't add up. You cannot promise that
    in a fixed period of time you're going to cut everybody's taxes, raise
    defense, bring back Star Wars, and balance the budget. That is exactly
    what we heard before. It is almost exactly what we heard before. And
    what did we get? The debt of this country was quadrupled in 12 years.
        A lot of the isolated elements are very popular, and they sound
    wonderful. But when you add it up, you wind up with more deficits, which
    will take the economy down, cause massive--I'm talking massive--cuts in
    all Government programs, including education and Medicare and other
    things. We're not talking about minor things. We're talking about huge
    cuts. You'll still have a bigger deficit. The economy will be weaker,
    and we'll go right back where we were when we tried this before. That's
    my problem, not the specifics. The specifics sound great. But the
    package is cynical because when you say, ``How are you going to pay for
    it?'' ``I'll tell you later.'' And it's the same thing as it was before.
    It's more red ink when we ought to be investing and growing. That's the
    way to put the American people first.
        Q. First of all, I'd like to say, I think you're doing a great job,
    and I'm proud that you're my President.
        The President. Thank you.
        Let me say before you ask your question, I'm glad to have this
    opportunity to have this kind of discussion. And I want people who
    disagree with me to ask their questions. And I don't believe that any
    party or group has a monopoly on political wisdom. But I'll tell you
    something, when you hired me to be President,

    [[Page 1860]]

    you knew that no matter who was President, this country had a lot of
    serious problems and we had to face them and that all the solutions
    wouldn't be popular. If it were easy, somebody would have already done
    it. The only thing I don't want you to do is to fall into the path of
    just taking another easy way out.
        Go ahead. I'm sorry.
        Q. That's okay. [Laughter]
        The President. Go ahead.

    Middle East Peace Process

        Q. In light of the recent events that are going on in Israel and
    your upcoming trip, what kind of assistance will you give to or pressure
    will you put on Arafat to control what's going on in terms of the
    violence coming out of the territories?
        The President. That's an excellent question, first of all. Let me
    tell you a little about my trip, so I can answer that question. The King
    of Jordan and the Prime Minister of Israel are going to sign this peace
    agreement in a couple of days, and they've asked the United States, the
    President, to be the witness of it because we worked so hard on it.
        I'm going to go to Cairo to see President Mubarak, who's been a real
    partner of ours in this Middle East peace process, and to visit with
    Chairman Arafat there in Egypt about all the issues you just raised. I'm
    also going to Syria, as you know, to hope to make further progress there
    because until we have a peace with Syria, we can't get a peace with
    Lebanon and a comprehensive peace in the area.
        There are two questions in the question you asked. One is the
    question you asked, what are you going to do to see that Chairman Arafat
    keeps his commitments under the agreement he made with Israel? The
    second question is, what can we do to increase his capacity to keep
    those commitments?
        Keep in mind, the really difficult thing in this Middle East peace
    package is, if Israel makes an agreement with Jordan, they are two
    nations, with two systems of law enforcement, two armies, two sets of
    borders. They can--they have a real capacity to enforce their agreement,
    the same as if we can ever get this agreement with Syria or with
    Lebanon; you will have borders, armies, institutions, law enforcement.
        With the agreement with the PLO in the West Bank and--I mean, in
    Gaza and Jericho--I mean, in Jericho and the West Bank, you have only
    the beginnings of the capacity to honor this. Now, when Corporal Waxman
    was kidnapped, I believe that Mr. Arafat really made an effort to help
    find out where he was and to share intelligence with the Israelis, and
    it was a good first step. But I will press him to honor the agreements
    in spirit and letter, but we also have to develop his capacity to honor
    the agreements. That is very important because, keep in mind, the PLO
    had never--not only never run a police force or an army before but never
    had to see the lights come on or do all the things Mayor White has to
    worry about: does the sewer system work; does the water system work;
    what is the order and structure of events?
        So the challenge is not only to get them to want to keep their
    commitments but to ensure that they can keep their commitments.
        Q. Good afternoon, Mr. President. First of all, I'd like to say I'm
    a native of Camden, Arkansas, a Razorback, 45 miles from Hope, Arkansas.
        The President. Thank you.
        Q. Watermelon capital of the world. [Laughter]
        The President. The chamber of commerce thanks you.

    Public Awareness of Administration Accomplishments

        Q. All right. I am a staff rep with the international union of
    Communication Workers of America--President Morton Bahr, out of
    Washington, DC, headquarters; Jeff Rechenbach, our newly elected vice
    president here in district 4.
        My question is--and you already alluded to most of what I'm going to
    say--all the good things you're doing leading our country, good things,
    signing the bill, the family leave bill, the crime bill, and also you
    just signed the education bill the other day. Why--I'm getting to the
    question--[laughter]--I want to know why you're not getting that--the
    media, rather, is not getting that out for all the good things. All we
    are hearing is the negative side of it.
        The President. Well, I told my press conference the other day in
    Washington that I arranged it that way because I didn't want to peak too
    soon. [Laughter]
        It's a complicated thing, really it is. Let me--it is a complicated
    thing. First of all, there is a highly political chain of communication
    on the other side of people that disagree with me

    [[Page 1861]]

    about everything, and they have their own kind of media outlets. And the
    Democrats really never developed such a thing in the time when we didn't
    have the White House and I think didn't appreciate it because the--the
    national media tends to be--during the--while Congress is there, the
    things that go on longer get more coverage than the things that go on
    shorter. So if you pass a bill and it's good news, it's news for one day
    or maybe one night on the television, and then it's gone. If you have a
    bloodbath over health care for 4 months, you hear about it every day.
    And you remember what Mark Twain said, that there are two things people
    should never see, sausage and laws being made. [Laughter]
        And I think sometimes just the--it's hard to see the forest for the
    trees sometimes. And I think that, you know, I need to give more thought
    about what my responsibility in this is, how I can do a better job of
    communicating with the American people, getting this information out.
    But it's always easier when the Congress goes home because then I can go
    out and have meetings like this, we can talk, and we can communicate.
        It is one of the great frustrations of the job, you know, because
    all the research shows that only a very small percentage of the American
    people know about the family leave law or the middle class college loans
    or the apprenticeship programs or immunizing all the kids in the country
    under 2 or the Head Start program. Senator Glenn showed me an excerpt
    from Time magazine which said that this Congress had enacted a higher
    percentage of my proposals than any Congress had done for a President
    since the end of World War II, except for President Eisenhower's first 2
    years and President Johnson's first 2 years. And I dare say nobody in
    America knows that.
        So I would say I have to do a better job of that. I think sometimes,
    you know, I get so busy working on things I forget that the American
    people hired me to communicate with them as well as to work. And
    frankly--and our adversaries, if they just want to stop us from doing
    things, then they don't have to do as much work as we do because all
    they have to do is just keep saying no out in the country, so it's
    easier. They have an easier burden than I do because they don't have to
    get anything done if they just want to stop things.
        So I just have to do a better job. And any of you got any good ideas
    about how I can do a better job of communicating, I'd like to have them.
    I'm not as good a talker as I thought I was when I got this job.
    [Laughter]
        Thank you.
        Q. Mr. President, I'm Tom Corey from Brook Park, Ohio. And I want to
    add our welcome to you, as well.
        The President. Thank you.

    Middle East Peace Process

        Q. My question is the Middle East again, back to that, Lebanon, and
    how soon do you think we can expect a treaty between Lebanon and Israel?
    And the second part of the question is, can we get the travel ban to
    Lebanon lifted? And then, I believe you are more than a candidate for
    the Nobel Peace Prize.
        Thank you.
        The President. First of all, I think there will be a peace with
    Lebanon, for reasons that you clearly understand by the question you
    asked. Peace with Lebanon will probably come about the time peace with
    Syria does. I think we have some chance of getting there. I wouldn't
    expect some sort of immediate breakthrough; I don't want to unduly raise
    expectations. But we are making good, steady progress. And I think it is
    very much in the interests of the people and the governments of Syria,
    Lebanon, and Israel to keep going with the peace process. I cannot set a
    time for you on that. If I knew, I probably couldn't say, but I don't
    know.
        But I can tell you, we're making good progress. The travel ban is an
    issue which will come up. We are trying to take these issues one by one,
    as we can. I'm encouraged by the travel that's going back and forth in
    other countries now, especially between Israel and Jordan. I'm
    encouraged by the lifting of the embargo against Israel by the GCC
    countries. So this is another barrier that will surely fall; even though
    I can't tell you when, I think it'll be sooner rather than later because
    we seem to be on a pretty good roll here.
        If the people of Israel can keep their courage up and the people of
    the Middle East can keep their courage up and we won't be intimidated by
    these terrorists and enemies of peace, I think we'll get there in a
    reasonable time. And I thank you for your question.
        Q. Mr. President and ladies and gentlemen, this will be the last
    question.

    [[Page 1862]]

    Health Care Reform

        Q. President Clinton, my question is about health care and how it
    might be paid for. My proposal is that to keep the taxpayers constantly
    informed as to the cost of health care, that a national sales tax be put
    on every purchase at the retail level, and that this--if the
    expenditures on health care increase or if they decrease, then that this
    is--as quickly as possible be reflected in the amount of the percent of
    the tax; also that tax stamps be put out--Ohio wants to do that--so the
    people knew they were paying for the program. So, sir, to keep the
    taxpayers informed, I think the regular tax and that sort of thing
    should be adjusted as a function of time and as a function of the total
    expenditures.
        Would you comment, sir? [Laughter]
        The President. Well, there are--I know you're laughing, but there
    are some people in the Congress who think that health care should be
    funded that way, too, with a national--some sort of national sales levy.
        Let me tell you what my problem with it is. My problem with it is
    that we are already, let me say again, we are already spending 14
    percent of our income on health care. Canada spends 10; Germany and
    Japan are a little under 9 percent of their income.
        Now, part of the reason we spend more is that we have higher rates
    of AIDS and higher rates of violence and higher rates of some other
    health problems than they do. So if we had more people showing up at the
    emergency rooms in Cleveland that are cut up or shot or have drug
    problems, just to take three, we're going to pay more for health care.
        But a lot of it is because our system is so incredibly inefficient
    in so many ways. And the problem I've always had with just passing some
    sort of a tax to cover the uninsured is that you just build in all the
    inefficiencies into the system and you force the people who are
    already--many of whom are already paying more than their fair share for
    health care to pay for everybody else's health care as well, without
    knowing whether they're going to pay their fair share.
        So there are a lot of people, good people, who agree with the
    proposal that you have outlined. But I'm just reluctant to embrace it
    until I believe we've done more to build in some competitive pressures
    to take waste out of the system and to make sure the people who can pay
    their own way are doing their own part before we ask the rest of
    Americans to do anything for them.
        Thank you very much.

    Note: The President spoke at 12:40 p.m. at the Statler Tower Building.
    In his remarks, he referred to Steve Smith, club president; Mayor
    Michael R. White of Cleveland; Representative Eric Fingerhut; King
    Hussein of Jordan; Prime Minister Yitzhak Rabin of Israel; President
    Hosni Mubarak of Egypt; and Yasser Arafat, Chairman, Palestine
    Liberation Organization.