    [Public Papers of the Presidents of the United States: William J. Clinton (1995, Book II)]
    [October 27, 1995]
    [Pages 1686-1688]
    [From the U.S. Government Publishing Office www.gpo.gov]

    Exchange With Reporters Following the Departure of President Soeharto of
    Indonesia
    October 27, 1995

    Gross Domestic Product Report

        Q. [Inaudible]--growth figures?
        The President. Well, the growth figures clearly show that the
    economy of the United States is moving, that we're on the right track.
    Today we have this very high growth figure. Just a few days ago we got
    the good news that the deficit has dropped dramatically now for 3 years
    in a row. We need to build on this. We do not need to reverse our
    economic course. That's the message I have for the Congress on the
    deficit reduction. We should balance the budget. We should continue to
    reduce the size of the Federal Government. But we need to do it in a
    prudent way that continues to invest in our people, in our education,
    our technology, for the health care of our seniors and the future of our
    children and our environment.
        We are moving in the right direction. This is the right direction.
    Why would we reverse course? We now have virtually 3 years of complete
    economic data showing that this policy that we have followed with great
    discipline and determination is good for the American people. So I hope
    we can stay right with it.

    Budget Legislation

        Q. Mr. President, some liberal Democrats are afraid that as part of
    the end game, after the veto and after the real negotiations begin, they
    may be left alone out there, that you'll make a deal in the center
    somewhere with some moderate Republicans that would be enough to see a
    compromise go through.
        The President. Well, first of all, my goal would be to have a budget
    that would be--get a huge bipartisan vote. And my principles have been
    clear. If there are those even in my own party who do not favor a
    balanced budget at all, then there will come a time when we'll be on
    different sides of the fence on that.
        But I would ask you to remember, look how much the liberal Democrats
    have done to move to a dynamic center in the last 3 years: They voted
    for deficit reduction; they voted for a very tough crime bill; they
    voted for an education reform bill that had high standards and let us
    let all kinds of States and school districts get out from under Federal
    regulations. They are moving. And I think most of the traditional
    liberal Democrats are trying to create a dynamic future. I believe they
    will vote for a balanced budget if it's the right kind of one.
        You know, the Republicans' leaders say they have certain principles.
    And they are--what are those principles? Balance the budget, secure the
    Medicare Trust Fund--excuse me--balance the budget, secure the Medicare
    Trust Fund, have a tax cut, and have more authority being given to the
    States and the local governments. I have

    [[Page 1687]]

    said I would embrace all those principles. I do believe a tax cut should
    be targeted toward childrearing and education and toward the broad
    middle class of America.
        But I have certain principles. What are my principles? Don't reduce
    Medicare and Medicaid more rapidly, more radically than the system can
    contain and that will be fair to our seniors and to others that depend
    upon the program. Don't cut investment in education, technology, and
    research when education, technology, and research will determine our
    economic growth. Don't destroy the environment or our ability to
    regulate and maintain the public health. Those things, it seems to me,
    are pretty clear principles.
        Now, I have already said, you know, the principles they say are
    important to them, they're important to me. I want to balance the
    budget. I'm determined to secure the Medicare Trust Fund. I want a
    reasonable tax cut targeted to the middle class, childrearing, and
    education. But I have these other principles on health care, on
    education, on the environment, on technology. And one other thing, I
    cannot in good conscience support a budget that actually raises taxes on
    people with incomes under $30,000 a year more than they're cut. That is
    wrong. It is wrong to raise taxes on working people with children at
    that income level.
        So if we can--I've already said these are my principles. And I
    believe these principles, if furthered and if there are some other
    adjustments made in the budget--if we don't do too much to harm rural
    America and the farming sector and a few other things--I think you could
    get a huge, huge bipartisan vote for a balanced budget. But we are a
    long way from there right now.

    Fort Bragg, NC, Tragedy and GDP Report

        Q. [Inaudible]--this new figure what does it say that could
    possibly--[inaudible]--interest rates? And second of all, do you know
    anything about the shooting at Fort Bragg?
        The President. Let me answer the second question first. I received
    very early this morning a briefing. I know something about it, but I
    don't believe that I know enough, more than has been in the press, that
    I should comment at this moment. Obviously, I'm very concerned about it,
    but I don't think I should comment.
        Now, the growth figure--I don't believe the growth figure should
    raise interest rates because inflation is so low. Keep in mind, the
    inflation rate is hovering around 2 percent. So that's the extraordinary
    thing about this. The combined rates of unemployment and inflation are
    at a 25-year low. The danger in the economy is not inflation now. The
    problem in the economy, the challenge of the economy is it's a time of
    rapid change, so there are a lot of people who aren't getting raises,
    even though there's growth, and there are a lot people who are still
    worried about losing their jobs, even though there's growth.
        Those are the challenges we have to face. That's why I want the
    education tax deduction. That's why I want to increase investment in
    education, not cut it. That's why I want to raise the minimum wage.
    That's why I want the ``GI bill'' for America's workers to pass, so when
    people lose their jobs, they can immediately start new training
    programs.
        We should be focusing on the challenges this economy poses, not
    undermining its strengths. That's why this budget battle ultimately is
    important. It's our values and what works for the economy. Both are at
    issue here. We can get this done, but we've got to do what's right, and
    we've got to do what's right for the economy.
        Q. Mr. President, some of that growth was due to Government
    purchases. Do you think this growth pace can be maintained in the face
    of all the budget cutting that's going on?
        The President. Well, they say their budget will give us a slower
    growth for the next 7 years than we've averaged in the last 25. I find
    that hard to believe, but that's what they say. They say their budget
    will give us lower business profits for the next 7 years than we've
    averaged. I find that hard to believe, but that's what they say. They
    say their budget will give us higher inflation in health care costs even
    though they claim they're going to lower health care inflation.
        There are a lot of things about their budget I don't agree with. But
    if we cut Government expenditures, obviously, a lot of Government
    expenditures are with private contractors. If we--for example, if we
    build a new airplane, most of the people who build the airplane are--
    they're private sector employees. If we build a building, the people who
    build the building are private sector employees. But if we do this in a
    disciplined way, and we keep our investments up and focus on shrinking
    Government

    [[Page 1688]]

    consumption--that is, lowering the programs that are of marginal benefit
    or getting rid of them, and slowly downsizing the Government, although
    we've been in a rapid downsize period--and we keep investing in America,
    then the activity in the private sector with growth will more than
    overcome the shrinking of the public sector. But we have to do it in a
    disciplined way.
        That's another thing that bothers me about this health care
    business. I have been talking about the need to reduce health care
    inflation since the day I became President. I've been talking about the
    need to give more options for managed care since the day I became
    President and since long before I became President. But you cannot just
    say, ``Well, we're going to take $450 billion out of it, even though we
    don't know what's going to happen.'' It is too much. It is too extreme.
    It is not necessary.
        So the thing for us to do is to ultimately--what my goal is, to
    ultimately come out with a budget which satisfies their stated
    principles, which I have embraced, but which honors my stated
    principles, which they have yet to embrace. The stated principles that
    I've put out are more important for standing up for what's right for
    America, number one, and more important for growing our economy, number
    two, than what's in their budget.
        And so we're going to keep working on this, but I am not going to
    bend on my principles. I cannot, and it's not good for America. This
    program--now we have 3 years of evidence. It's not only morally right,
    it is working for the country, and we need to keep going in this
    direction.
        Thank you.

    Note: The exchange began at 11 a.m. at the West Wing Portico at the
    White House. A tape was not available for verification of the content of
    this exchange.