[Public Papers of the Presidents of the United States: William J. Clinton (1995, Book II)]
[September 15, 1995]
[Pages 1361-1364]
[From the U.S. Government Publishing Office www.gpo.gov]

Remarks to Representatives of Senior Citizens Organizations
September 15, 1995

    Thank you very much. I'm delighted to see all of you. I'm glad to 
see you with your buttons and your--apparently, with your spirits 
intact. That's good. [Laughter]
    As all of you know, we're having this huge debate in Washington 
today about the future of this country. I want to try to put this 
struggle over Medicare and Medicaid into some kind of proper context so 
that you can take it not only to the Members of Congress and to your own 
members but out to the American people at large.
    There is an enormous consensus in our country, with which I agree, 
that we ought to pass a budget this time that will bring our books into 
balance by a date certain. I agree with that. We got into a bad habit, 
this country did, before I showed up here, in the eighties and the early 
nineties, of running a permanent deficit, not to invest, to grow the 
economy, to create jobs, but just because every year we preferred to 
spend more money than we were taking in. And it wasn't good for the 
country. We're on the verge of paying more in interest next year

[[Page 1362]]

than we pay for defense, for example. And every year we keep doing that, 
we spend more and more on interest, and we have less and less to spend 
on everything else.
    But why do we wish to do that? What are the values implicit in that 
choice? We do it because we want to free our children and our 
grandchildren from the burden of unnecessary debt. We do it because we 
don't want to have a country where the Government is taking all the 
money and the money will be free to be borrowed by private businesses to 
create jobs and to grow the economy. We do it because we think morally 
we'll be a stronger country if we don't just borrow money for the sake 
of borrowing it.
    But our objectives will be undermined if we forget about the other 
obligations we have. That's why I've said, you know, we ought to balance 
the budget, but why would we cut education and thereby hurt the economy 
and hurt the future of the very children we're trying to help? Why would 
we undermine our ability to protect the environment and public health 
and thereby erode the very quality of life we say we're strengthening by 
balancing the budget?
    And the same thing is true here. We have historically recognized 
significant obligations to the health care of people who are entitled to 
be taken care of through the Medicare program or, through no fault of 
their own, have to be given some assistance. It's a part of who we are; 
it's a part of what kind of country we are.
    And that's what this fight over Medicare and Medicaid is all about. 
What are our obligations to each other? How are we going to fulfill 
them? This is a compact between the generations, a compact we have 
honored now for three decades. It has made America a stronger, better, 
more humane place. It has made family life more secure not only for 
seniors, not only for Americans with disabilities but for their family 
members, their hard-working family members who knew that they got a 
little help so that they could all fulfill their responsibilities. These 
are the values I would argue that we want to advance as we try to 
balance the budget. We don't want to undermine them. We want to do this 
in a way that will bring the American people together, not tear the 
American people apart. That is what I am working to do here.
    It is truly ironic that this whole Medicare fight is being played 
out against the background of the trouble that the Trust Fund is in. 
Where did you hear that first? From me, right? And in 1993 and 1994, 
when I said the Medicare Trust Fund is in trouble, we have to do 
something to lengthen its life, we have to do the responsible thing and 
keep it strong, and I proposed solutions to keep it strong, some of 
those who are for cutting Medicare $270,000 billion today said that I 
was raising a red herring, that it wasn't really in trouble, and why 
were we even worried about this. How quickly they forget.
    But thanks to the responsible people in the Congress in the last 2 
years, we extended the life of the Medicare Trust Fund by 3 years. And 
in my balanced budget proposal, we extend the life of the Medicare Trust 
Fund by more than a decade from this day forward, making it in better 
shape than it's been in 9 of the last 15 years. That is what we have 
proposed to do and to do it without imposing new costs on seniors.
    Now, the congressional Republicans have outlined their plan to 
balance the budget, which includes a $270 billion Medicare cut, 3 times 
the size of any previous cut, and a $180 billion Medicaid cut. Together 
that's nearly half a trillion dollars taken out of the health care 
system over the next 7 years. I doubt seriously that the health care 
system can afford that. And that again affects all of us, not just 
people on Medicare, not just people on Medicaid. Almost half a trillion 
    Their plan would increase premiums and other costs for senior 
citizens. It would reduce doctor choice. It would force many doctors to 
stop serving seniors altogether. It threatens to put rural hospitals and 
urban hospitals out of business. Brick by brick, it would dismantle 
Medicare as we know it.
    Now, here's the point. If all this were necessary, really necessary 
to save Medicare, maybe we'd all be willing to do it. But it isn't. And 
that is the point that has been missing from all this public debate, the 
point I tried so hard to make yesterday, the point you know but, I have 
to tell you, most of your fellow Americans, even members of your various 
groups who are on Medicare, do not know: The proposed reductions in the 
congressional or Republican congressional plan in Medicare spending on 
providers do go into the Trust Fund; the proposed increased costs on 
seniors do not go into the Trust Fund as a matter of law.

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    So all this conversation we have heard about saving the Trust Fund--
give them their due, when they're talking about holding back money from 
Part A to the hospitals and the doctors, they're telling the truth; that 
will go into the Trust Fund. But the extra cost to seniors, by law, will 
not go into the Trust Fund. You know it and I know it and everyone in 
America should know it. Every nickel that will be taken from the seniors 
will go into the General Fund where it will be used to carry out this 7-
year plan, which includes a very large tax cut. So this is a plan to 
take more from people on Medicare, three-quarters of whom live on less 
than $24,000 a year, and put it into a tax cut, more than half of which 
will go to Americans who plainly don't need it.
    Now that has to be driven home. That is a fact. And it is a fact I 
almost never hear discussed. This is not about saving the Trust Fund. If 
we were really about to see the Trust Fund go broke and there were no 
other options, we would all be saying, ``Let's get in a room and roll up 
our sleeves and figure out what it is we have to do to save the best of 
this program,'' wouldn't we? Every one of us would be; none of you would 
be here raising sand about that. And you'd also want to say to the 
hospitals, ``We want to keep you open,'' to the doctors, ``We want to 
keep you going. We don't want to bankrupt anybody. Let's see how we can 
have a fair plan of shared sacrifice.''
    But by law, the money coming out of the seniors does not go to that 
Trust Fund. And it is a grave disservice to the American people not to 
just tell everybody that, not to say, ``Hey, we'd like to fix the Trust 
Fund, and here's what the providers are going to have to sacrifice.'' 
Then you could look at the President's plan and their plan and you could 
compare. I think my plan asks about all of the providers they can come 
up with, and it adds 10 years to the life of the Trust Fund. Unless we 
can dramatically lower medical inflation, I think it asks about all we 
can right now. But it's good that it adds a long time to the Trust Fund.
    But the money we're asking for from seniors--not us, but the 
congressional Republican plan--the money they ask for from the seniors 
won't go into that Trust Fund. And no one must be allowed to believe 
that it does. This is going into the balanced budget plan to pay for the 
tax cut.
    I am also for a tax cut. I believe we ought to help working families 
raise their children and educate themselves and their children and give 
tax reductions for those purposes. But I do not favor funding them by 
raising the price of Medicare on the poorest elderly people when, as all 
of you know, the average senior citizen today is paying the same 
percentage of his or her income for health care in 1995 that they were 
paying in 1965 before Medicare came in. So it isn't true to say the 
seniors of this country haven't done their part to try to keep Medicare 
going. We've seen increased costs with inflation.
    So I ask you to hammer this point home. This should not be a debate 
between things that the seniors and the disabled people of this country 
can't afford to pay and a system we can't afford to let go broke. That 
is not the choice. You know it; I know it; America must know it before 
these decisions are made. Fine, let's save the Trust Fund. We're going 
to do it. I've been working on it for 2\1/2\ years. We've made it 
better. But let us not pretend for a moment that it is necessary to do 
what is being done either to balance the budget or to save the Trust 
Fund. These fees on seniors are going up to meet that particular plan 
with that very large tax cut. And everyone must know that.
    A lot of these most painful cuts have been hidden altogether. In 
this congressional plan, deep within the fine print of the Medicare plan 
are cuts to be revealed later. What is it called--automatic look-back. 
[Laughter] We've all done that once or twice in one or two ways.
    Now, think about this: What about the Medicaid program? You hardly 
hear anything about Medicaid. People say, ``Oh, that's that welfare 
program.'' One-third of Medicaid does go to help poor women and their 
poor children on Medicaid. Over two-thirds of it goes to the elderly and 
the disabled. All of you know that as well. America must know that. If 
we reduce projected Medicaid spending by $180 billion and if States were 
to follow through with across-the-board cuts, our best estimates are 
that by the year 2000, there would be 300,000 people who would be either 
removed from or not be able to get into nursing homes and 4 million poor 
children who would not have access to medical care. Hundreds of 
thousands of families would have a much harder time caring for a member 
of their family in their home or helping their family members in some 
other way.

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    This is very important. If you don't do it across the board--you 
say, oh, we're going to take care of the people in nursing homes, the 
seniors--that's even more disabled people who are cut off. That's even 
more seniors in their homes who aren't helped. That's even more children 
who are in the streets without any health care. This is not a free ride.
    Do we need to lower the rate of inflation in Medicaid? You bet we 
do. I proposed a plan to do that. It doesn't reduce spending by near as 
much as theirs does because I don't know that we can do that. I honestly 
believe these things are going to happen. And we need to consider the 
consequences of them. I don't want to do something that could close our 
rural and urban hospitals, that could make the lives of poor children 
even more difficult, that could be terrible for not only the disabled 
and the elderly who would be affected by it but for all their family 
members. You think about how many middle class working people are not 
going to be able to save to send their kids to college because now 
they'll have to be taking care of their parents who would have been 
eligible for public assistance.
    I am not saying that we shouldn't balance the budget and that we 
don't have to slow the rate of increase. But look at the proposals we 
made in this administration. We made sensible, disciplined proposals 
that won't be easy to meet, but can be met and are directly related to 
saving the Medicare Trust Fund and to bringing the cost inflation down 
in health care and to balancing the budget, without asking the seniors 
of this country to pay for a tax cut for people who don't need it or 
where the size of it is too big.
    And I'm telling you, you can have the right kind of tax cut, you can 
have a healthy Medicare Trust Fund, you can have reductions in cost 
inflation in Medicare and Medicaid without these draconian consequences. 
That's what you have to tell the American people. If these were the only 
choices, it'd be tough enough. But this is an easy choice once you know 
the alternatives. If these health care cuts come to my desk, of this 
size, I would have no choice but to veto it.
    But let me say this. What always, always becomes the news every day 
is what the new fight is, what the new conflict is. We ought to be here 
to build a bridge. I can't believe anyone would willingly, willingly 
damage the seniors of this country, the Americans with disabilities, the 
children of this country as much as I believe this proposal will damage 
them, especially to pay for a tax cut that is too large, when we can 
have a targeted tax cut for education and childrearing for middle class 
families without doing any of this, when we can balance the budget 
without doing any of this, when we can save the Medicare Trust Fund 
without doing any of this. [Applause]
    I'm glad you cheered and I'm glad you clapped, but there is a bridge 
to be built here. We can get all Americans on the solution side of this 
problem. We can get Republicans and Democrats on the solution side of 
this problem. It is not too late. We have a few weeks here. But first, 
the American people must know the facts. So I implore you--most of you 
know so much about this you just assume other people do, too. And it is 
a very powerful thing to tell an average American working family that 
deeply believes in this country that we've got to do what it takes to 
save Medicare. That's a powerful thing. Well, we do. But this is not 
what it takes to save Medicare, this proposal that we're opposed to.
    So I ask you, stand up for what you believe. Fight for what you 
believe. Know that I'll be there for you if it comes to crunch time. And 
if I have to use the veto pen, I will. But go out there and build a 
bridge. Start it with the facts, the evidence, the truth. Ask people to 
come to grips with the truth. And ask them what our obligations are to 
one another. Ask them why we're balancing the budget and don't we have 
to balance the budget consistent with our desire for strong families, 
for honoring the people who have made this country what it is today, and 
for building a better future for our children, whether they're rich or 
    That, I think, ought to be the message. If so, we'll wind up 
building that bridge and making this country stronger.
    Thank you, and God bless you all.

Note. The President spoke at 3:41 p.m. in Room 450 of the Old Executive 
Office Building.