    [Public Papers of the Presidents of the United States: William J. Clinton (1995, Book II)]
    [July 20, 1995]
    [Pages 1121-1127]
    [From the U.S. Government Publishing Office www.gpo.gov]

    Teleconference Remarks and a Question-and-Answer Session With the
    National Conference of State Legislatures
    July 20, 1995

        The President. Thank you, Jane Campbell, for your gracious
    introduction and for all the great work you've done as president of the
    NCSL. I saw your mother yesterday morning at my affirmative action
    speech, and I wonder who you're going to produce in your family to start
    tomorrow off right for me. I'm very glad to see you again.
        I want to wish your incoming president, Jim Lack, the best of luck
    in the coming year. I think he can expect interesting times as well.
        Let me express my thanks to your NCSL vice president, Mike Box; your
    former president, Bob Connor; two of your assembly chairs, my good
    friend Dan Blue, and Representative Bill Purcell, with whom I enjoyed
    working at the Vice President's family conference in Nashville recently.
    It's great to be here with all of you, even if I'm only here by
    satellite.
        You know, the image that is bringing me to you traveled from
    Washington to a satellite about 22,000 miles away in space, and then
    back down to Milwaukee, a total of 44,000 miles. Back when I was a
    Governor, there were times when I felt that Washington was that far
    away. And it's been very important to me, as you said, to try to make
    you feel that we're not 44,000 miles away, that we're not living on a
    different planet, that we can stay in touch with you and that we can
    work together.
        For 12 years I lived with State government, and I saw how it can be
    the laboratory of our democracy. I know how you drive us forward as a
    nation with your innovation, your will to experiment responsibly, and
    your common sense. You are the inspiration for so much of what we're
    trying to do up here. And I thank you very much for that.
        America's State legislators have had a very productive year. I
    noticed that in Utah, West Virginia, New Mexico, and Montana, statutes
    were enacted that permit employers to establish medical savings accounts
    for health care. Delaware and Ohio have led the way with truly
    meaningful welfare reform legislation that is focused on protecting our
    children and moving people from welfare to work, something I've been
    laboring with for 15 years now. And I understand that those of you from
    Iowa saw fit to put diaper-changing tables in all the Statehouse
    restrooms. Now if that is not a sincere commitment to family values, I
    don't know what is.
        For many of you, your work for the year is done. But in Washington,
    as you know, we've still got a very long way to go. When I ran for
    President as the Governor of my State, I did it for two reasons. First,
    I thought that, on the verge of the 21st century, we were in danger of
    losing the American dream of opportunity for all and in danger of losing
    our sense of responsibility with all the social problems that were
    tearing our country apart. So I wanted to restore opportunity and a
    sense of responsibility.
        But I also wanted to bring the American people together as a
    community. Politics has been used too long to divide us when what we
    really need to do is to rise above partisanship to find common ground.
    In order to do that, Washington needs to inspire the trust of more
    people throughout the country with a Government that empowers people to
    make the most of their own lives, empowers communities to solve their
    own problems, and is far less bureaucratic and less proscriptive.
        Now, in the last 2\1/2\ years, I believe we've produced some real
    achievements. The economy is up; inflation is low; trade is expanding;
    interest rates and unemployment are down. The facts speak for
    themselves. In the last 2 years, we have cut the deficit by a third, and
    we're in the process of reducing it for 3 years in a row for the first
    time since Harry Truman was Presi-

    [[Page 1122]]

    dent. We have put in place more than 80 new trade agreements, including
    NAFTA and the GATT world trade agreement and an historic pact to
    finally, finally open Japan's markets to American cars and American auto
    parts.
        These efforts have added about 7 million new jobs to our economy,
    and almost all of them have been in the private sector. To give you an
    idea of what that means, it's like creating a job for every person in
    Delaware, Idaho, Maine, Mississippi, Montana, and Wyoming combined. In
    1993, our country established more new businesses than ever before, and
    in 1994 Americans broke that record again.
        One of the best pieces of evidence that this country is turning
    around is right in the room here. The report NCSL issued for this
    conference, the report the New York Times put on its front page on
    Sunday, says that the finances of the State are, and I quote, ``the best
    they have been since the 1980's.'' Last year employment grew in all 50
    States and independent forecasters expect the same thing to happen again
    this year.
        I have only one thing to say to that. As good as this is, you ain't
    seen nothing yet if we stay on the same course. We couldn't have done
    all this without a strong commitment to changing the way the Government
    does the people's business here in Washington, because the old Federal
    ways and the old Federal bureaucracy were not going to permit the kind
    of changes that we have to make as a country to get to the 21st century.
        Our Federal work force is well on its way to being the smallest it's
    been since John Kennedy was President. It will be in just another year
    or two. Already, we've cut well over 100,000 positions from the
    Government; hundreds of programs have been abolished. Just last month,
    we got rid of 16,000 pages in the Federal Code of Regulations. Fifty
    percent of the regulations at the Small Business Administration are on
    their way to being history. We've reduced that budget by 40 percent and
    doubled the number of small business loans.
        Forty percent of the Education Department's regulations are being
    scrapped. And as you know, that will directly help a lot of you. The
    time it takes to fill out EPA regulations has been cut by 25 percent.
    And we're now telling small businesses around America, if you call the
    EPA and you ask for help on a problem, you cannot be fined for 6 months
    while you try to work it out.
        Reinventing Government means reinventing the way the Federal
    Government does business with you as well. Our job has been to bring
    together all levels of government to cooperate, to find common ground,
    to actually work together to solve our Nation's problems, instead of
    just talking about them. We have worked very hard to forge a genuine
    partnership between the States and the National Government.
        I learned about the importance of this partnership a long time ago.
    When I was the Governor in Little Rock, the legislature and the
    Governor's offices were close together, just one floor apart in the
    capitol. We saw each other all the time. Legislators dropped by my
    office at any time of the day or night during the legislative sessions.
    Many legislators even came to the Governor's morning planning meetings.
    There was a spirit of teamwork, a tremendous amount of goodwill, and an
    awful lot of good came out of it.
        As you know, unfortunately, we too often don't work that way in
    Washington. I am doing my best to build on that tradition to go beyond
    partisanship to finding common ground and actually solving a lot of
    these issues.
        I've also tried to give you more say in your own affairs. We have
    now given 29 States a total of 33 waivers from Federal rules to enact
    their own welfare reform proposals. In the last 2\1/2\ years, more
    States have received waivers than in the previous 12 years of the
    previous two administrations combined. We have also given 10 States
    waivers to carry out major health care reform initiatives.
        I did sign, as Jane said, the Unfunded Mandates Act, which restricts
    Congress from passing new mandates on State and local governments
    without paying for them. From now on, Congress will not be able to take
    you out for a 10-course dinner and then stick you with the check.
        We have proposed setting up performance partnerships with you. Under
    this initiative, you would have a real say in how Federal programs are
    run in your State. But in exchange for more flexibility and more freedom
    to innovate, you would also be more accountable for the results.
        The list goes on. OSHA and the EPA no longer play cops and robbers
    with you as they used to. We're moving away from punishment to
    compliance as a goal. FEMA used to be

    [[Page 1123]]

    a disaster, but all of you who had to use it in the last 2\1/2\ years
    know that it is a genuine disaster agency now, helping States all across
    our country to respond quickly and efficiently and compassionately to
    crises.
        Even though we've made strides, I know we still have a lot to do.
    That's why I have submitted my balanced budget plan, which I believe is
    important because of the way it balances the budget and because of the
    things that it still does in the budget both for the American people and
    with the American States.
        All of you have to balance your budget, and you know it's important.
    The United States never had a structural deficit until about 12 years
    ago. Before, when we ran deficits, it was just because of economic
    conditions. But from 1981 until the day I took office, we quadrupled the
    debt of this country. And we were in a position where we were going to
    have deficits forever and ever, with all the economic weakness that that
    implies.
        I know what you have to do and the tough choices you have to make. I
    used to do it every year for 12 years. We are now at an historic moment,
    because for the first time in a long time, the leaders of both parties
    in Washington agree that we must balance the budget. The Congress has a
    budget plan that I have differences with, but at least we share this
    common goal. And I am confident we are going to be able to work together
    to balance the budget and to help all Americans achieve the objectives
    of a balanced budget, a stronger economy, and a brighter future for
    ourselves and our children.
        But in the meanwhile, we need to be honest and open about our
    differences, and there are real differences. The biggest difference is
    the difference between necessary cuts and unacceptable and ultimately
    self-defeating pain. Our balanced budget plan cuts spending by more than
    $1 trillion. It cuts non-defense discretionary spending by an average of
    20 percent across the board, except for education. The congressional
    plan wants to make deep cuts in education and training, while I want to
    increase our investment in education, because that is essential to our
    ability to meet the challenges of the next century.
        Let me say also that I am very concerned about the direction that
    the House Appropriations Committee seems to be going with regard to the
    bill which includes funding for key education and training initiatives.
    The bill they've come up with would eliminate the Goals 2000 program. It
    would drastically cut back the school-to-work initiatives that we have
    used to help all of you establish systems in your own State to move
    everybody who doesn't go on to 4-year colleges into a continuing
    education program.
        And let me stop and say that when I became President, I knew that
    the United States was the only advanced economy in the world that had no
    system for the young people who did not go on to 4-year universities. We
    all have our community colleges; we all have our vocational schools; we
    all are blessed with private sector employers that try to provide people
    on-the-job training. But we had no system on a State-by-State basis in
    all 50 States for keeping up with those young people who don't go to the
    4-year schools and making sure that they can make the transition from
    school to work in a job with a chance to have a growing, not a shrinking
    income. So I think it's a mistake to walk away from the school-to-work
    program.
        They also want to effectively gut the safe and drug-free schools and
    communities program. I know that a lot of you have schools that need
    more help with security measures, that need more help with drug
    prevention measures, and that you cannot provide this money on your own.
    The safe and drug-free schools program has enabled all the schools of
    our country to access the resources they need to try to have the schools
    be safe and drug-free. This House proposed budget would also deny Pell
    grants to 300,000 students who want to attend college. And it would cut
    job training for hundreds of thousands of Americans just when we need to
    help our people build the skills to meet the demands of the 21st
    century.
        If Congress sends me this bill in its present form, I will have to
    veto it because it will weaken our economy and it will undermine the
    good that we can do by balancing the budget. The congressional plan will
    also cut Medicare in a way that could impose huge costs on the elderly.
    We have to reduce the rate at which Medicare costs are increasing. We
    can reform the Medicare program, but we have to make sure that it will
    be intact for Americans who need it.
        Congress also has a plan that will give very large tax cuts that
    will primarily go to people who are better off. I think the tax cuts are
    too large and will require cuts in Medicare, Medicaid, and education
    that are too large. But

    [[Page 1124]]

    if we simply cut taxes for people who really need it, cutting taxes for
    middle class people so that they can invest that money in their children
    and in their education, we can afford a sizable tax cut, balance the
    budget, and continue to invest in our fundamental needs.
        The congressional plan would balance the budget in 7 years. I
    believe that that is too fast. We have had a deficit since 1969. We have
    had a huge structural deficit for 12 years. We've already cut the
    deficit for 3 years in a row. I think it is better to take a little more
    time so that we can continue to invest in education, protect Medicare,
    protect our relationships and our partnerships with you, and invest in
    the things that will grow our economy. If we can balance the budget in
    10 years without doing that kind of harm, we ought to take more time and
    do it right.
        So I say, let's balance the budget, but let's balance the budget in
    10 years, not 7 years. We cannot expect to undo these decades of fiscal
    damages overnight. And we must continue to make investments here at the
    national level, in education, in investments in science and technology
    and the environment, and obviously, in Medicare and Medicaid.
        How we balance the budget is as important as balancing it. Just 3
    extra years will preserve the dreams of millions of Americans, and it
    will strengthen our economy. We get all the economic benefits of
    balancing the budget and the economic benefits of opening the doors of
    college education to all with affordable and repayable loans; continuing
    to increase the impact of Head Start for our young people; and being
    able to create a genuine big training program for unemployed and
    underemployed people, so that we can get rid of all these many, many
    dozens of Federal training programs and still have enough money to put
    in this block so that people who lose their jobs or are underemployed
    can have access to training which they can take to the local community
    college or any other place of their choice.
        Now, to me, this choice is clear, and I hope you will agree. I was
    gratified to learn that yesterday, your Federal budget and taxation
    committee passed a resolution calling for a balanced Federal budget
    within 10 years. That will enable us to maintain our partnership.
        The congressional budget would also do something else. I believe it
    would put an unfair burden on every one of you. Anybody who's worked in
    State government in the 1980's learned a very painful lesson.
    Washington's budget decisions all throughout the eighties gave us too
    many problems and too few resources. States were stuck with a horrible
    combination of more mandates and less funding. I know there are people
    in this room who worked night and day to see to it that the citizens of
    your State were taken care of, but it wasn't easy. There was an awful
    lot of unnecessary pain. And I don't see any reason on Earth why we
    ought to go through that again. But that is exactly what could happen
    with the congressional budget.
        It sounds good. It calls for block grants for Medicaid and food
    stamps. But I have to tell you, I have real doubts that these block
    grants would be able to keep pace with the demands that you are going to
    face in your individual States. And in the real world, remember that
    economies change, populations rise, needs evolve. As those things happen
    you could be locked into a grant that could lock you into a real bind.
    And no matter how great a job you've done getting your own fiscal house
    in order, no matter how hard you've worked to prepare your State for the
    next century, you'll have to respond. And that could mean putting the
    working families of your State, the children of your State, the elderly
    of your State either in dire straits at the moment that we need to be
    doing everything we can to help them to make the most of their own
    lives, or forcing you to raise taxes when that might not be in the
    economic interests of your State or your people.
        Should the States have more responsibility? Of course, they should.
    I'm doing my best to give you more. Should you deliver primary services?
    You always have. Should we in Washington do more than we have to free
    you up? Absolutely, we should. But we ought to do it in partnership.
    Simply moving the bureaucracy from one place to another or shifting the
    problems from one level to another is nothing more than a shell game.
    Giving you the responsibility without the resources could be disastrous.
    We can do better than that. We can get rid of this deficit. We can give
    our people the tools they need to make the most of their own God-given
    talents, and we can give our States more flexibility.
        The budget process is entering a crucial stage now. If there was
    ever a time for you to add

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    your voices, the time is now. We need to get to work, and we need to do
    it in a bipartisan fashion. I have the feeling that even today at the
    State level there is less partisanship, less ideological argument, and
    more willingness to roll up your sleeves and get down to work than there
    is too often here in Washington.
        You can help us with that. We need an infusion of that. We can solve
    the problems of this country. We can give you more flexibility, balance
    the budget, still invest in our people as we need. But to do it, we have
    to look beyond the hot air and the harsh talk and try to find common
    ground.
        Thank you very much, and God bless you.
        Representative Jane Campbell. Thank you, Mr. President. It is now my
    pleasure to call upon two of our colleagues to pose questions to
    President Clinton. The first is NCSL's incoming president, Senator Lack
    of New York.
        Senator Lack.
        Senator James Lack. Good morning, Mr. President.
        The President. Good morning, Senator.
        Senator Lack. As I assume the presidency of NCSL I certainly look
    forward to continuing the relationship between our organization and you
    and your administration and would like to take this opportunity to
    extend an invitation to you to join with us next year at our conference
    in St. Louis if you can.
        The President. Thank you.
        Senator Lack. Mr. President, you alluded to block grants. State
    legislators, for many years, have supported the flexibility provided by
    block grants and performance partnerships. However, the worst scenario
    we could imagine would be to receive block grants that really aren't
    block grants. Will you support us in keeping block grant legislation
    free of mandates and other proscriptive elements?
        The President. Well, first of all, I agree with you that if we're
    going to have a block grant program, it ought to be as free as possible
    of proscriptive mandates, consistent with the larger objectives of the
    program. The community development block grant program that I used as a
    Governor, that presumably many of you still take full advantage of at
    the State level, worked pretty well in that regard.
        And I am generally in favor of pushing more and more decisionmaking
    away from the Federal Government down to the States and, where
    appropriate, not only to local government but to private citizens as
    well. For example, I have proposed this ``GI bill'' for America's
    workers, which would take these 70 Labor Department job training
    programs and just get rid of them, put it into a block, and when someone
    is unemployed, they can apply and get a voucher worth $2,600 a year for
    up to 2 years to take to your local community college or wherever else
    they want to get the training.
        We have given, as I said in my remarks, welfare reform waivers to 29
    States, and we have more pending. I am opposed to Washington's
    micromanagement, whether it comes from the right or the left. And I have
    been very concerned that in the welfare reform debate we were going to
    wind up under the guise of giving the States more responsibility,
    essentially putting more details on the States and putting the States in
    an economic bind.
        Right now, the welfare reform bill is stalled in the Senate because
    some of those mostly on the extreme conservative end of the Senate
    believe that it doesn't contain enough mandates to, for example,
    prohibit any funds going to teenage mothers who have children out of
    wedlock and to their children.
        I believe that what we ought to do, consistent with the very few
    things we know--I've worked on welfare reform for 15 years--we know a
    few things. We know that most people on welfare will go to work if
    they're given a chance to do it. We know that the absence of child care
    is a big problem, a barrier. And we know that the States will figure all
    this out if they have the tools to do it right. So what I want to do in
    the welfare reform debate is to give you the maximum amount of
    flexibility, consistent with some simple objectives. I do think the only
    place we need Federal rules and welfare reform--and you and I, I think,
    have talked about this before--is in the area of child support
    enforcement because so many of those cases cross State lines.
        So I'm going to do my best to get you a welfare reform proposal
    which gives more flexibility to the States and doesn't have a lot of
    ideological proscriptions one any or the other and just focuses on one
    or two big things that need to be done. I think that is the right way to
    do it.
        Let me just say one other thing, though, about these block grants.
    Block grants are very good if they can be used by you for the purpose
    for which they're intended and they don't have

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    some trap down the road. So for example, with the community development
    block grant, the dollar amount I got was held constant for a decade. So
    in real terms, it got smaller and smaller and smaller. But since I
    didn't have a dependent population that had to have it every year we
    were able to work and make the most of it, use it to create jobs in my
    State without causing any problems anywhere else.
        Now, if we turn food stamps into a block grant, what are we going to
    do the first time we don't have all 50 States growing? The food stamp
    program, because it goes to people in need, worked very well in the
    1980's when, first of all, we had the so-called bicoastal economy. The
    coasts were doing well, and the heartland was doing terribly. Then when
    the heartland and the Middle West and the South came back, the coast got
    in trouble; the food stamp program worked as an economic stabilizer as
    well as a personal safety net, moving back and forth across the States
    to help deal with the problems of those States. I think that there's a
    real potential for problems for you in that.
        And I feel the same way about Medicaid. If you have a Medicaid block
    grant with--particularly with all the other problems you've got, what
    are we going to do the first time that there's a terrible but uneven
    recession in America?
        And in the case of the welfare program, if there were an AFDC block
    grant with no local participation requirement, look what that could do
    to you. What are you going to do if you get cut across the board,
    Medicaid cuts, education cuts, welfare cuts, and you've got a welfare
    block grant with no local participation requirement, and then that money
    becomes the target of every lobby group in your State legislature that
    needs it? What's going to happen to the poor children in your State?
        So what I think we need to do is to be very practical about this,
    not ideological; use the block grants where they'll work, and give you
    as much flexibility as possible to be creative. The Federal Government
    should be defining the objectives we want to achieve, and unless we have
    absolute, clear, unambiguous evidence that some condition or another is
    a precondition of achieving that objective, we ought to give you the
    maximum amount of creativity. That's what I tried to do with this waiver
    process, and that's the direction I think we ought to take.
        Representative Campbell. Thank you, Mr. President. Our second
    questioner is Representative Dan Blue of North Carolina, chair of our
    Assembly on Federal Issues.
        Representative Blue.
        Representative Daniel Blue. Thank you, Madam President. Good
    morning, Mr. President.
        The President. Good morning, Dan.
        Representative Blue. Mr. President, you alluded briefly to welfare
    reform. State legislators have welcomed the current debate on the
    welfare system. We, like you, believe that it is in need of substantial
    reform. However, NCSL believes that any welfare reform legislation must
    contain some kind of contingency or rainy-day fund to assist States
    during periods of emergency. And we wonder whether you would share with
    us your position on this issue.
        The President. Well, I clearly agree with you. If we're going to the
    block grant proposals, there have to be some protections for the times
    when the economy goes down in the country as a whole and the times when
    the economy goes down in some parts of the country but not in others. I
    have tried to say all along that one of the big risks with these block
    grants is that some States are going to come up short in the next
    recession, and all States could.
        And one of the things that really concerns me--I'm very excited
    about the fact that there's a lot of energy here in Washington and a lot
    of energy for reform throughout the country. We've got a lot of new
    people in Government with a lot of really determined ideas about what to
    do to change. And even when they disagree with me, I think it's an
    exciting thing to have this kind of debate. But we must have memory,
    also, and we must have some way of calling on our common experience.
        I am gratified that the productivity of the American private sector
    and the economic policies that we have established, the kind of work
    that many of you do in economic development in your own State, have
    given us now a couple of years of nationwide economic growth. But I want
    to reemphasize, if you go back over the last 20 years in our history,
    this period is atypical. In most of the last 20 years, we've had some
    regions doing well while others were doing poorly.
        And we need to make sure that we don't have States left holding the
    bag if their own economies hit a log down the road. Now, I

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    have spoken to State legislators now throughout the country, in Florida
    and Indiana and other places, and I can tell you that--I mean, Florida
    and Iowa and other places, excuse me--and I can tell you that I've
    talked privately with Republicans and Democrats alike, who ask me to
    fight for protections like the contingency fund and even the State
    match. Particularly in the fast-growing States, they're worried about
    this. So I will support you on that. I will stand with you on that.
        I think that what you need to do here is to make sure when each one
    of these issues is being debated in Congress that you understand both
    the up sides and the down sides, because when Congress proposes these
    kind of block grants they may be in philosophical agreement with you at
    one level, that you should have more say over your own affairs, but keep
    in mind also, there's a big desire to meet these very, very tough
    deficit reduction targets that they have set for themselves. So if they
    are using you to save money, it only works for you if the increased
    flexibility and the diminished paperwork and hassle and the increased
    creativity you can bring to the task means you can do the same work for
    less money as well or better than you were doing it before. And it only
    works if these economic changes have been taken into account.
        So I'm with you on it. I'll work with you. We can get this done. I
    will say again, for all of my differences with the Congress, we have got
    to balance the budget. We are going to do that. We are going to reach an
    agreement on it. But we need to do it in a way that enables you to do
    your job and that promotes the objectives of a balanced budget: more
    jobs, higher incomes, a more stable future for our children.
        Thank you very much.

    Note: The President spoke at 11:16 a.m. by satellite from Room 459 of
    the Old Executive Office Building to the convention meeting in
    Milwaukee, WI.