[Public Papers of the Presidents of the United States: William J. Clinton (1996, Book I)]
[April 11, 1996]
[Pages 569-572]
[From the U.S. Government Publishing Office www.gpo.gov]



Remarks Announcing Proposed Retirement Savings and Security Legislation
April 11, 1996

    Thank you very much. Thank you, Shawn and Secretary Rubin. Secretary 
Bentsen, it's nice to have you back in the Rose Garden; to all the 
business people here; the representatives of working people who are 
here; and to all the members of the administration who are here who 
worked on this project--I thank not only those who are here on the 
platform with me but those who are in the audience, especially Marty 
Slate at the Pension Benefit Guaranty Corporation.
    This is a very important day today. There are an awful lot of small-
business owners, like Shawn, who are trying to do well not only for 
their companies but by their employees. We want to help them to give 
retirement opportunity and security to their workers. There are an awful 
lot of working people out there today who are afraid that if anything 
happens to the job they're in now, that they'll also lose the 
opportunity for a secure retirement. And we want them and their families 
to have the opportunity of that security when they're out there working 
hard and doing the best they can.
    I have said many times that we are living in an age of remarkable 
possibility where more Americans than ever before will have the 
opportunity to live out their dreams. But we also have significant 
challenges, and one of those great challenges is to help in this 
incredibly dynamic economy, so dominated by rapid changes of information 
and technology, so subject to global markets, which is basically a 
positive thing--I was so happy to hear Shawn say that the product that 
his company makes might be used to install on mass transportation to 
protect people from terrorist attacks; that alone would be one of the 
most significant advances we've seen in this country in many years. But 
we have to find a way to keep the dynamism of this global economy going 
and still allow people who are working in it in good faith to achieve a 
measure of security for themselves, their families, and their children.
    This problem is similar to the problems that people faced a century 
ago when our grandparents moved from the farm to the factory and from 
the country to the city. There were

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vast new opportunities, but also so much disruption there was a lot of 
insecurity. And over time, our country found ways to build mechanisms of 
security and stability into the lives of working families, which enabled 
our economy to continue to grow into the world's strongest but enabled 
all Americans who are working to benefit from it and to stabilize their 
lives, their family's lives, and in the process, their communities' 
lives.
    That is the challenge we face today. When I took office, the economy 
was drifting; unemployment was high; the few new jobs we were getting 
were in lower wage industries overwhelmingly; the deficit was 
skyrocketing. Our economic team that is here with me today determined 
that we would do something about that. We had two central commitments: 
first, that we had to cut the deficit in half over 4 years, and second, 
that if we did it right and we got interest rates down, we continued to 
invest in education and technology and to aggressively open markets for 
American products, we could also see 8 million new jobs coming into our 
economy.
    Well, those promises have been kept. That deficit will be cut by 
more than 50 percent by the end of this fiscal year, and we already have 
8.5 million new jobs in this economy. And I am proud of that. To give 
you some idea of the dimensions of that achievement, of the Big Seven 
economies in the G-7, America's 8.5 million new jobs are more than 8 
million more than the combined new job totals of the other six countries 
in this very competitive global economy.
    Nonetheless, we see the paradox of the moment because, day after day 
after day, we read about how people feel uncertain and insecure in a new 
world in which America's unemployment rate today is a full point lower 
than the average unemployment rate of the last 25 years. And that is 
because of all the dynamism and the new rules of the economy.
    So the challenge now is: How do we keep the dynamism going? How do 
we keep the new jobs coming in? How do we keep the deficit coming down 
until we balance the budget, and still provide those mechanisms which 
will allow our people in this new age to do what we had to figure out 
how to do 100 years ago: to take advantage of all these new 
opportunities but to still be able to compose a good life for themselves 
and their families, their children, and their communities.
    It is clear that there are at least three things we have to do. 
Working families have to have lifetime access to education and training, 
lifetime access to affordable health care, and they have to have the 
ability to build a pension throughout a lifetime no matter where they 
work or whether they change jobs.
    So we have proposed a ``GI bill'' for America's workers so that if 
whenever people lose their jobs, they can immediately get a voucher that 
will cover their training costs for up to 2 years. We have proposed to 
make the cost of college tuition tax deductible. I have called on the 
Congress to pass the Kassebaum-Kennedy bill, which is an important first 
step in guaranteeing access to affordable health care. The bill says you 
can't lose your health insurance when you change jobs or if someone in 
your family gets sick, and I hope and pray that that bill will be coming 
to my desk in the fairly near future.
    Today I am urging Congress to pass this legislation we are proposing 
on retirement security so that people can build retirement throughout 
their careers.
    As Secretary Bentsen said, in the last 3 years we have done a lot to 
protect American pensions and to expand opportunities to save for 
retirement. But there is so much more we have to do. Millions of 
Americans are not saving enough for their retirement. Often they have no 
choice. They either have a job where there's no retirement plan, or they 
have to change jobs. They aren't eligible for savings plans. Their 
employer doesn't offer the pension plan, or sometimes, even if they had 
one, the employer goes out of business before a plan can vest.
    All these people may work as hard as they can. They may be doing all 
the right things. But they still have to worry about what will happen 
when their work is done, and they don't have the options that Secretary 
Rubin talked about, to put their savings into a retirement account that 
could be withdrawn from, tax-free, if there's a family emergency, if 
it's necessary for the health of a parent or the health of a child, or 
if they want to buy a first home or finance a child's education.
    So all these things are, I think, a part of why we can have good 
economic news and still have good Americans working hard, feeling 
uncertain about their future. That is what we're

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here to do today, to try to respond to that challenge.
    I have proposed legislation to help these hard-working Americans. We 
call it the ``Retirement Savings and Security Act.'' It expands coverage 
to help 51 million working Americans who are not now covered by an 
employer-provided retirement plan. Very importantly, it increases 
portability, so workers can take their retirement savings with them and 
keep saving if they change jobs or lose their job and have to wait a 
time to find a new job. This also enhances security so that retirement 
savings will be there when a worker retires.
    With the ``Retirement Savings and Security Act,'' we can help to 
make retirement something Americans can look forward to, not dread. 
Where their hard-working retirement earnings are concerned, we can give 
Americans peace of mind. First, we ought to make it easier for small 
businesses like Shawn's--I might say, his is growing rather rapidly; 
Secretary Bentsen said he had 11 employees, Shawn said, ``No, 13''--
[laughter]--and next month there will be a couple more. We ought to make 
it easier for them and, indeed, for all employers to provide pensions or 
other retirement plans.
    Right now, three-quarters of the workers in large businesses have 
employer-provided pensions, compared to only one-quarter of workers in 
small businesses. So we would establish a new kind of 401(k) plan for 
employees of small businesses. They could expand coverage with this 
provision alone by up to 10 million working Americans.
    Second, we should expand IRA's. We want to double income eligibility 
so that 20 million more Americans earning up to $100,000 a year can take 
this tax deduction. This would, first, raise the savings rate in America 
and, second, make it possible for other family emergencies or needs to 
be met, for our plan would allow IRA withdrawals for education and 
training, first-time home purchases, major medical expenses, or during 
long-term unemployment.
    Third, we have to make these pensions portable. This could help more 
than 5 million workers every single year. It means workers in new jobs 
will not have to wait to start saving in an employer pension plan. And 
we can start at home. We will start by allowing Federal workers to save 
from the first day on the job. People would be able to keep saving 
through a 401(k) plan even as they move from job to job. We will further 
ensure that veterans who serve their country will not risk an 
interruption in their pension coverage. And it will guarantee coverage 
and benefits for more union workers who change jobs often, like those in 
the construction industries.
    Fourth, we must continue to enhance pension security. We build on 
what we have done to help secure pensions through tighter enforcement. 
Most employers do play by the rules, but we must ensure that no employer 
can easily skim from their employees' contributions. Our plan cracks 
down on fraud, requires broader audits, and protects workers like those 
whose pensions were threatened in the Orange County bankruptcy.
    Finally, we should not go backward. As Secretary Rubin said, in the 
budget plan that I vetoed, Congress permitted $20 billion to be taken 
out of pension plans affecting--excuse me--in the 1980's, companies took 
$20 billion out of pension plans that affected something like 2\1/2\ 
million American workers. And in 1994 when I signed the legislation that 
Secretary Rubin and Secretary Bentsen referred to, we were at that time 
looking at the possibility that 8\1/2\ million more American workers 
could lose their pensions. So the '94 legislation clearly saved the 
pensions of 8\1/2\ million American workers and stabilized those of 40 
million others.
    Now, when the budget passed, part of it was giving a green light to 
corporations to take $15 billion more out of pension plans. One of the 
reasons I vetoed that budget--one of several--was that I do not believe, 
after all the horrible experience of the eighties and after what we went 
so far to do in a bipartisan fashion in 1994 to stabilize the pension 
funds of the country, that we ought to turn around and repeat the 
mistakes of the past. Our first rule ought to be to do no harm in an age 
of opportunity and uncertainty.
    Now I want to call on the Congress to help us move forward. In many 
of the things that I have proposed today, there is very broad bipartisan 
support--broad bipartisan support for making the 401(k) plans more 
readily available, broad bipartisan support for an expanded IRA. We have 
to do the portability piece of this; we have to do it. We have to create 
an environment where ordinary working Americans can look forward to a 
future with excitement. They'll say, ``Hey, well, maybe I'll have to do 
more

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jobs than my parents and grandparents did, but I'll always be able to 
get education and training. I'll always be able to afford health care 
and have access to it. I'll always be able to have a retirement plan for 
my later years. My family is going to be all right in this new world.''
    That is what this legislation is all about. That's what retirement 
savings and security means. I hope the Congress will join with us. I 
hope we can pass all the elements of this plan, and we ought to be able 
to do it fairly quickly because I do not believe there is a partisan 
issue here. This is something we can and should do for America, and we 
ought to do it now.
    Thank you very much.

Note: The President spoke at 11:23 a.m. in the Rose Garden at the White 
House. In his remarks, he referred to Shawn Marcell, president and chief 
executive officer, Prima Facie, Inc., Conshohocken, PA.