[Public Papers of the Presidents of the United States: William J. Clinton (1994, Book II)]
[November 5, 1994]
[Pages 2001-2007]
[From the U.S. Government Publishing Office www.gpo.gov]



Remarks to the National Association of Realtors in Anaheim, California
November 5, 1994

    Thank you very much, Bob Elrod, for those kind remarks. Gil Woods, 
Secretary Cisneros, I'm delighted to have you with me here today, and I 
thank you for your outstanding work in the area of housing, for all the 
things you are doing to make our country a better place. I'd also like 
to thank the United States Marine Corps Band from El Toro who played 
before I came. I thank them.
    I am delighted to be here with all of you, including, I understand, 
hundreds of you from 36 nations, including some newly emerging 
economies, who have traveled here for this convention.
    I was kind of looking forward to coming here today. You know, 
Saturday is traditionally moving day in America, and families think 
about moving toward new homes. For me, it was just another opportunity 
to move out of Washington and come see you. [Laughter]
    This has been an interesting 2 years for me. There have been some 
great times and some not-so-great times, some that were exhilarating and 
some that were nearly bizarre. Some days I feel like the boy who told 
his mother that he really didn't feel like going to school, and his 
mother said, ``But Son, you have to go to school. I raised you to do the 
right thing.'' He said, ``But it's not fun for me at school anymore, 
Mother. I mean, the students don't like me. The teachers don't like me. 
The coaches groan when I walk by. Even the custodial workers don't like 
me.'' She said, ``Son, you have got to go to school. You're intelligent; 
you're healthy. You don't have a good excuse. Besides, you're 45 years 
old, and you're the principal.'' [Laughter] So I try to show up, 
regardless. And I'm glad to show up here today.
    Today I want to talk with you about the dream of homeownership and 
the larger American dream of which it is a part and what we can do 
together to keep the economic renewal that began 21 months ago going. I 
ran for President of this great land of ours because I felt that for too 
long our National Government had neglected issues that are fundamental 
to our national strength, our security, and our future: good jobs, 
strong families, better schools, safe streets, and a world more full of 
security, trade, freedom, and peace.
    In this country, when I took office, we had already been grappling 
for 30 years with profound social problems that have disturbed every 
person in this great hall today, affecting the breakdown of our 
families, our communities, the rise of crime and drugs and gangs and 
guns.
    We have lived, and certainly you have lived, with about 20 years of 
economic stagnation for many ordinary Americans who are the bulk, the 
heart and soul of the home-buying public, people who work year in and 
year out for wages that have barely kept up and often have not kept up 
with inflation. And we have had--we had had 12 years of a policy which 
became loosely known as trickle-down economics, with which I deeply 
disagreed and with which you

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as an association at least disagreed with specific parts of, as I heard 
in my introduction, the things that we reversed from the '86 tax act.
    When I became President, we put together an economic strategy that 
was comprehensive in approach, long-term in vision, but quite basic: 
reduce the deficit; change the way Government works, make it smaller 
with less regulation, more efficiency, a greater emphasis on 
partnership, and increase the impact of the things that you should do; 
ease the credit crunch; help small business; invest more in the security 
of our families and the skills of our people; invest in new technologies 
and defense conversions; increase trade.
    We have pursued this strategy with discipline and persistence and 
success. The deficit includes a spending cut of $255 billion. This year 
alone, it is $100 billion less than it was projected to be when I took 
office. We are looking at 3 years of deficit reduction in a row for the 
first time since Harry Truman was the President of the United States.
    In changing the way Government works in this country, we have 
adopted now two budgets covering 6 years, which will reduce the size of 
the Federal Government by 272,000, to its smallest size since John 
Kennedy was the President of the United States. Already there are 70,000 
fewer workers working for the Federal Government than there were on the 
day I was inaugurated President.
    We have deregulated banking, deregulated trucking. We have gone a 
long way to deregulate Federal rules and regulations on States, giving 
20 States permission to try their own ideas to move people from welfare 
to work, giving 9 States permission to try their own ideas to find ways 
to increase the number of working people who have health insurance in 
this country.
    We are working hard to change the way our Federal Government relates 
to our schools with very strong national standards of excellence in 
education but deregulating the way the schools meet those standards, 
instead emphasizing local reforms, grassroots initiatives, all kinds of 
changes initiated by people at the local level to help achieve the kind 
of learning that we simply have to have if our people are going to 
compete and win in the 21st century.
    And inasmuch as I am here in Orange County, I have to say a special 
word of thanks to a member of my administration who happens to be an 
Orange County Republican. Roger Johnson, who runs the General Services 
Administration, has helped to spearhead our reinventing Government 
initiative to make sure that we not only downsize the Government, that 
we also make the Government work better. If you ask the people in 
California, for example, we rebuilt all the highways out here that were 
damaged by the earthquake in about half the time that people said we 
could do it if we worked flat out. We did it not by Government mandate 
but by simply saying we would pay you more if you finished quicker. 
[Laughter] A novel idea, long discarded by the Government, revised for 
the California earthquake rebuilding effort.
    We finally adopted a bill to change the way the Government buys $200 
billion worth of goods and services with your tax money every year. And 
in so doing, by stripping away rules and regulations, we are saving $50 
on every single Federal Government purchase, under $2,500, a year. No 
more $500 hammers. No more $50 ashtrays. We have opened the markets to 
the kind of competitive pressures all of you observe.
    This year, even though we reduced defense and domestic discretionary 
spending for the first time in 25 years, we are investing more in Head 
Start, in more affordable loans for middle class students, in national 
service to allow young people to earn money for their college education 
by serving their communities at the grassroots level, in apprenticeship 
programs for people who don't go to college but do want good training 
and good jobs for the future.
    And we are taking all the money that we are saving by reducing the 
Federal bureaucracy by 272,000 and putting it into financing the crime 
bill, giving the money right back to grassroots communities to hire 
police officers, to institute the prevention and the punishment programs 
that I believe can lower crime and violence in this country if people at 
the community level will spend the money in the proper way. We took the 
money from the Washington bureaucracy and gave it to every community 
represented by every person in real estate in this entire hall. I think 
it was a good switch. It will make our country safer.
    We have also increased our investment in new technologies and 
defense conversions to help communities that have been hurt by base 
closings or by their big industries losing defense contracts. And we 
have dramatically expanded

[[Page 2003]]

trade with NAFTA, with the GATT world trade agreement. As soon as the 
election is over, literally a couple of days after that, I have to go 
all the way to Indonesia for the second annual meeting of the leaders of 
the Asian-Pacific economic group. It's a leadership organization that I 
really got to meet for the first time as leaders in Seattle last year. 
Why am I doing this? Not because I want to take another trip 2 days 
after the election but because Asia is the fastest growing part of the 
world economy and the United States needs to be in those markets. It's 
high-wage jobs for us. We have to continue to push that approach.
    Let me say that just this year, our exports to Mexico since we 
adopted NAFTA are up by 18 or 19 percent, 3 times the overall growth in 
our trade. Auto exports to Mexico are up 500 percent. I just came back 
from Michigan, where the biggest complaint is the amount of overtime the 
autoworkers are having to work. That, folks, is a high-class problem.
    Now, this is the strategy of which you were a part when your 
organization supported our efforts last year. What I want you to know is 
it is working. Just yesterday we learned that unemployment in the United 
States had dropped to 5.8 percent, a 4-year low, and that unemployment 
in California had dropped to a 3-year low at 7.7 percent.
    For those of you who aren't from here, let me tell you what happened 
to California. They not only went through the national recession, but 
California, with 12 percent of the population, had 21 percent of defense 
expenditures and suffered the impact of 40 percent of the base closings. 
So they're lagging a little behind the national recovery, but they are 
coming, too. They had a substantial drop in unemployment last month; now 
they're at a 3-year low.
    Overall, the economy of our country has produced more than 5 million 
new jobs in the last 21 months, 91 percent of them in the private 
sector. In this year, the best news may be that about half the new jobs 
are high-wage jobs, that more high-wage jobs have come into the American 
economy in 1994 than in the previous 5 years combined. That's good news 
for homeownership. It's good news for the American middle class. It may 
mean that after a very long period of time, we are turning around 
average wage levels by changing the job mix in America.
    I mentioned the auto industry to you; there are more people working 
in the auto industry now than in any year since 1979, even though they 
are much more productive and it takes far fewer workers to produce a car 
than it did in 1979. For the first time since 1979, automakers in the 
United States have produced worldwide and sold more cars worldwide than 
their Japanese competitors, for the first time in 15 years. And in the 
annual vote that occurs every year of international economists, for the 
first time in 9 years the United States was voted the most productive 
economy in the world. We are moving in the right direction.
    I have to say, as has already been noted, that we have focused 
intensely on the real estate industry as a part of all of this, because 
you are one-fifth of our gross domestic product, because we need a 
healthy real estate sector. And in the economic program last year, when 
you asked for passive losses to be restored for real estate 
professionals, when you asked for FHA limits that moved with the 
markets, when you asked for mortgage revenue bonds to be extended 
permanently, when you asked for a secondary market for commercial real 
estate loans, you got those things in our economic program because they 
were good for the United States and for our economy.
    Housing starts are up 30 percent since January of '93. And after 
declining by 664,000 the previous 4 years, construction jobs have 
increased by 436,000 since those changes were made and since we have 
begun to move this economy forward in the last 21 months. And I thank 
you for your contribution to the economic progress of the United States.
    I want to talk now about where we go. But I have to say, just for a 
moment, if you will indulge me, since I know I have a good bipartisan 
crowd here--there may be more, indeed, Republicans then Democrats in 
this audience--this is a rather curious election season. I mean, after 
all, if I were a Republican President who said to you, ``Look, we've 
reduced the deficit, reduced the size of Government, gotten the economy 
going again, adopted the toughest crime bill in history, promoted peace, 
and reduced the nuclear threat and increased trade all around the 
word,'' the Republicans would say it would be unpatriotic to campaign 
against the people who voted for those policies in their races for 
Congress. I think that's right.

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    And yet, we are living in a time of such cynicism that a lot of 
these races all around the country are being dominated by people who 
say, ``Vote for me because I know that the Government is inherently bad, 
that everything they do is wrong, that anything they do will make the 
problem worse, that if anything good happens in this country while Mr. 
Clinton is in office, it's either in spite of him or unrelated to the 
fact that, like the principal, he shows up for work every day.'' 
[Laughter]
    Now imagine this--suppose your office worked that way. And some guy 
comes in, and he says, ``Hire me to work in your real estate office 
because the real estate industry is inherently sick, and you couldn't do 
anything right if you wanted to. And if you hire me, I'll sit in the 
office all day, and I won't try to sell a house.'' [Laughter] If half 
the people who came to work in your place every day said, ``I'm showing 
up for work, but really we're going in the wrong direction, and we can't 
make anything good happen, and that glass is half empty,'' you would all 
be broke. And we are seriously entertaining giving our votes to people 
who tell us these things.
    Folks, the Government is neither inherently good or bad. It is our 
tool. It is the instrument that reflects us. It is what we make of it. 
It can do wrong; it can do right. It can be good; it can be bad.
    My view has been that we have tended to see Government in too much 
black or white terms. We'd look to Government as a savior when we're in 
trouble, and the rest of the time we say that we ought to junk it. It's 
either our savior, or we want it on the sidelines. The truth is, in my 
opinion, as we move toward the 21st century, Government should be seen 
as an instrument that seeks to create opportunity in the private sector. 
It seeks to empower people and then challenges people to assume both 
individual and community responsibility, because that's where most of 
the action is in America today. The Government cannot do as many things 
directly, and should not try; but without a sensible, aggressive, 
focused Government, working in partnership and challenging people to 
assume responsibility for their own lives, this country cannot live up 
to its potential.
    Many of the things that we do actually matter. The family and 
medical leave law made a difference in the lives of millions of 
Americans who wanted to be successful parents and workers, who wanted to 
be able to take a little time off when they had a baby born or a sick 
parent without losing their jobs.
    Our expansion of Head Start made a difference. That program works. A 
lot of kids are going to wind up being good students and good citizens 
now who might have taken a different path in life. Those things make a 
difference.
    The changes we made in the real estate laws, reversing the mistakes 
that were made in 1986, made a difference to you. It makes a difference 
whether we do the right thing or the wrong thing.
    So the only thing I ask you to do, without regard to your party or 
your philosophy, is to remember what we did here has made a difference. 
As they say back in Arkansas, where I come from, if you find a turtle on 
a fencepost, chances are it didn't get there by accident. [Laughter] And 
I think you ought to think about that.
    And what we need in this country so much is to get away from this 
whole kind of negative-dominated way of talking, where we scream at each 
other instead of visit with each other. Believe me, I don't have all the 
answers. And if you try to do as many things as I've tried to do, you'll 
make a mistake or two, and I acknowledge that. But what we need in this 
country is people in public life who do what you expect when you're 
trying to get to sell real estate: You've got to show up every day with 
a positive attitude and a willingness to look at the facts and a 
willingness to learn and a determination to make progress. That's what 
we need. We need to discuss these things with one another.
    These social problems we've got in this country, I say again, have 
been developing for 30 years, but they are of profound importance. We 
can fix the economy and if we lose millions of our kids, like those kids 
that dropped that 5-year-old out of that high rise in Chicago, well, 
it's going to be hard for America to be what it ought to be.
    And these economic problems are of profound complexity. When people 
work harder and they get more productive and they make the economy grow 
with no inflation, then the first thing they're told is, ``The economy 
is growing with no inflation, but we might have inflation, so we're 
going to raise interest rates so you won't get an increase in your 
income.'' These are frustrating, complex problems. On the other hand,

[[Page 2005]]

we don't want inflation. You look at these countries that are gripped 
with inflation. It will kill your economy. These are complicated 
problems. But what we need in America today is a country that should be 
full of optimism and hope and a conviction that we can all make a 
difference.
    When I came back from the Middle East, I was so impressed by that. I 
looked at the faces of our young men and women in uniform in the Persian 
Gulf who moved so quickly against Saddam Hussein's aggression. I looked 
at the people who were there at the peace signing between Jordan and 
Israel and how grateful they were for the role of the United States in 
that peace. And I thought to myself, around the world, nobody is cynical 
about the United States; they know this is a very great country. All I 
ask you to do is to bring your differences into the framework that this 
is a very great country, moving in the right direction, leading the 
world. And we can solve our problems but only if we speak with one 
another and listen to one another and stop just throwing these verbal 
bombs across the fences that divide us and turn us into cynical and 
negative people. We're not going to get anywhere doing that. [Applause] 
Thank you.
    I'd like to take the remainder of my time to talk a little about 
what you came here to discuss, and that is homeownership and whether as 
partners we can do anything to increase it. If you think about it, the 
idea of having your own home is the ultimate expression of optimism. 
Homes are for families. They make for a more secure environment for our 
children. They create pride and self-esteem. They are the extension of 
our personality, our hopes, our dreams. For most of us, they're the main 
harbor of all of our collected memories. They are the most important 
investment in financial security that most Americans ever make. And most 
people who own homes care more about their own communities and have a 
bigger stake in solving the kind of problems that we've been here 
talking about today.
    You know, I was thinking this morning as I flew over here, I have 
very vivid memories of every home I ever lived in, even when I was just 
3 or 4 years old. And I bet all of you do, too. I can hardly remember 
anything about my very early childhood, but I remember the feel, the 
look, the atmosphere of the first home I ever lived in. I think we all 
agree that more Americans should own their own homes, for reasons that 
are economic and tangible and reasons that are emotional and intangible 
but go to the heart of what it means to harbor, to nourish, to expand 
the American dream.
    A national survey recently found that most people won't start saving 
for a home until they believe that they can actually buy a home. And I 
want to say to the American people, and especially to young families, if 
that's what you think, you ought to start saving now, because I am 
determined to see that you have the opportunity and together we can make 
that opportunity for the young families of our country.
    I am committed to a new and unprecedented partnership between 
industry leaders and community leaders and Government to recommit our 
Nation to the idea of homeownership and to create more homeowners than 
ever before. I heard the kind introduction--well, of course the home 
mortgage deduction helps millions of ordinary citizens to achieve the 
dream of homeownership. Of course it does. But I believe we can do even 
more.
    As the economy recovers, we know that we're going to make progress 
anyway. There are 1.5 million more homeowners in America today then 
there were 22 months ago. Housing starts are up and sales and profits 
are up. Here in California, where, as I said, the economy has been in 
difficulty, the pace of home sales for the first 9 months of this year 
is the highest in 5 years.
    But still we face serious problems. Troubling changes occurred in 
the housing sector after 1980. After 46 years of steady growth, 
homeownership expansion began to head downward. Inflation, recession, 
stagnant incomes, the failure to enforce laws prohibiting discrimination 
in housing and lending, high costs and a reduced role for FHA perhaps 
all played a role. But by 1992, the national rate of homeownership had 
slipped dramatically. Homeownership for young families fell from 44.5 
percent in 1980 to 37.6 percent by 1992. In 1980, more than 70 percent 
of our children lived in homes owned by families. In 1991, that had 
fallen to less than 63 percent. By 1990, 2 million young American 
families who would have become homeowners if the upward trend had 
continued, did not have the chance to own their own home. We have got to 
turn this around. We have to move this measure or our national 
prosperity forward as well. And I am convinced that we can do it.

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    Therefore, today, I am directing HUD Secretary Cisneros to develop, 
in cooperation with the most significant members of the housing industry 
and government at all levels, a plan to boost homeownership to an all-
time high in the United States before the century is out.
    This initiative will draw heavily on the expertise of those of you 
in real estate, financing, and building. Representatives of State and 
local governments and nonprofit community-based groups will join in. 
Participants from our administration will include the Assistant to the 
President for Economic Policy, the Assistant to the President for 
Domestic Policy, the Secretary of Agriculture, the Secretary of Veterans 
Affairs. I want them to write and send me, within 6 months, a detailed 
strategy that recommits America to homeownership, that will add millions 
of new homeowners by the end of this century.
    I can assure you--just don't forget, the end of this century is just 
a couple of years away--I can assure you that this is not a report that 
will sit on a shelf. It is one that will be implemented. And let me be 
clear, this is not a Government program. I have asked for the 
involvement of realtors, homebuilders, mortgage bankers, Fannie Mae, 
Freddie Mac, insurers, the Habitat for Humanity, bankers groups, 
nonprofits, 40 other groups already on board to do their part. This is 
an initiative based on cooperation, not a Government program.
    We can achieve the results we seek for America's homeowners if we 
take seriously the lessons I mentioned earlier about the way we reinvent 
and change the role of Government, not what Government can provide but 
what Government can help make it possible for you to provide. 
Specifically, I've asked the Secretary to focus, in the beginning, on at 
least three areas. First, I directed this group to find ways to cut the 
costs and the regulations involved in buying a home. I want it to be 
simpler, less costly.
    Second, I want to target new markets, underserved populations, tear 
down the barriers of discrimination wherever they are found. Let me just 
make this point--[applause.] Thank you. Look at our trade policy. What 
are we trying to do? We tore down barriers to trade with Mexico because 
we knew they'd buy more of our products. We would buy more of theirs; 
they would buy more of ours. It would change the job mix in America for 
more high-wage jobs. The biggest untapped market in America for many of 
us are the millions and millions and millions of people that the economy 
of the 1980's left behind, people who live in our cities, people who 
live in our isolated rural areas, people with productive capacities who, 
if they can become consumers, can explode the American economic growth 
rate well into the next century. That is what this is all about, and we 
should all focus on it.
    Third, I want to develop new strategies for educating those who 
haven't considered becoming homeowners because they don't have an 
adequate comfort level or enough information to act. And believe it or 
not, at least our research indicates it's a much bigger problem than I 
would have thought when we began to look into it. Let me go through 
these issues briefly one at a time.
    A modest starter home today costs about $94,000 in many parts of the 
country, even more here in California. With only a 5 percent down 
payment and closing costs, that's about $9,000 up front. Half the young 
families in this country make about $25,000 a year. Well, it's hard to 
save $9,000 when you're raising children on less than $25,000 a year. 
Many families are paying more in rent than it would cost them to own a 
home and to build equity, but they can't come up with the front-end 
money. We have to do better.
    Secretary Cisneros has taught me the term ``lifer.'' As an old 
attorney general, I thought that had to do with the criminal justice 
system. But today, more and more, it refers to people who are renters 
for life, middle class Americans who have no hope of becoming 
homeowners. We can do better than that, and we will.
    We have to do a better job of reaching the underserved, of 
eradicating discriminatory practices that prevent minority families from 
finding, financing, or buying the home of their choice. It's wrong for 
anybody with a solid work history to be denied a home. And as so often 
is the case in the United States, if we do the right thing, it will be 
good business. It will be more money for all Americans and a greater 
rate of economic growth.
    The third and final element of the plan will involve improving our 
efforts at education and outreach. According to one national survey, 
fewer than half of all American adults know what they need to know to 
navigate the real estate market successfully. Surely with all the 
communications technology available today, we

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can do better than that in America. Every day you counsel, you educate, 
you elevate the comfort levels of potential homeowners. We need your 
help in learning how to do this better for people throughout the United 
States.
    If we do these three things--and perhaps this group, which will 
include representatives of your industry, will come up with others--we 
can widen the circle of home ownership beyond anything we have ever 
seen. And in so doing, we can slowly begin to restore the confidence of 
battered middle class American families who fear that even in times of 
economic recovery, their own family security will not be enhanced. That 
is the key to restoring the American dream, having working people 
believe that they can live in the turbulent, fast-changing times of the 
21st century and still come out winners if they work hard, become 
lifetime learners, play by the rules, and raise their kids well. And 
finding a way for these people to own their own homes is a critical part 
of restoring the sense of American security and the reality of the 
American dream. I want you to help me do that.
    My fellow Americans, through Presidents and administrations of both 
parties, the American people have been committed across party lines to 
the idea of homeownership. We have shown through things like the FHA and 
the GI bill that we can work in partnership to empower people who will 
take responsibility for their own lives. I am trying to do that now in 
many, many other areas of our national life. We are trying, all of us, 
to face problems we have ignored too long. We are trying to deal with 
the challenges and seize the opportunities that await us.
    I just want to say this last thing in closing: I am convinced that 
the best days of this country are ahead of us, if we will only seize 
these challenges, seize these opportunities, and maintain the attitude 
that all of you inculcate into everybody who works with you every day. I 
am telling you this is still the strongest country in the world, the 
greatest peacemaker in the world, the most powerful economy in the 
world. The only thing that can get in our way is our failure to believe 
in ourselves and our unwillingness to work together to face the 
challenges before us. If we can get rid of that, there is no limit to 
America's future.
    Thank you, and God bless you all.

Note: The President spoke at 9:40 a.m. at the Anaheim Convention Center. 
In his remarks, he referred to Bob Elrod, president, and Gil Woods, 
president-elect, National Association of Realtors.