    [Public Papers of the Presidents of the United States: William J. Clinton (1997, Book I)]
    [May 31, 1997]
    [Pages 686-688]
    [From the U.S. Government Publishing Office www.gpo.gov]

    The President's Radio Address
    May 31, 1997

        Good morning. I've just returned from Europe where I commemorated
    the 50th anniversary of the Marshall plan, which joined America's
    investment to Europe's commitment to rebuild and, in so doing, helped to
    spark 50 years of prosperity, not only for Europe but for America as
    well.
        I also had the opportunity to discuss with leaders of Europe the
    present success of our economy and what we can do together to promote
    prosperity in the new democracies of Central and Eastern Europe in ways
    that will ensure their prosperity and ours for the next 50 years.
        This morning I want to talk with you about the new economic policy
    we brought to America for the last 4\1/2\ years and how our balanced
    budget and tax cut plans can help in creating jobs, raising incomes,
    strengthening business, and moving America forward in the years to come.
        Recall for a moment what America's economy looked like 4 years ago:
    high unemployment, few new jobs, stagnant wages, exploding budget
    deficits. I took office determined to replace trickle-down economics
    with invest-and-grow economics. There were three principal elements to
    our strategy: reduce the budget deficit; and invest in the education,
    training, and security of working men and women and our children; and
    open new markets for American-made goods and services through tough
    trade agreements. I believe all three were necessary to create the
    conditions for private sector prosperity and to ensure that all our
    people have the opportunity to reap the rewards of growth.
        We made tough, often controversial decisions in 1993 and afterward
    to implement our new invest-and-grow economic policy. Some fine Members
    of Congress lost their seats because they had the courage to change
    course and vote for the future. But just look at the results. Today our
    confidence has returned and our economy leads the world.
        In 1992, the deficit was $290 billion. Today, we expect it to drop
    to $67 billion, a 77 percent reduction. In 1992, unemployment averaged
    7.5 percent. Today, it's 4.9 percent, the lowest in 24 years. In 1992
    there were few new jobs. Since then, the economy has produced 12.1
    million of them, including the most ever in a single Presidential term.
    And while the years before our plan took effect saw sluggish growth,
    yesterday we learned that in the first quarter of this year the economy
    grew at a 5.8 percent rate, the highest in a decade. Inflation is at a
    30-year low; business investment, a 30-year high. Each year we've had a
    record number of new businesses started. Wages are rising. In the last 2
    years, over half the new jobs have paid higher than average wages and
    inequality among working people has seen the biggest drop since the
    1960's. Our economy is the healthiest in a generation.
        All this didn't just happen. We've had better managed, more
    competitive businesses; more productive working people; the
    entrepreneurial spirit of small business; a Federal Reserve committed
    both to low inflation and to economic growth; and continued advances in
    technology. Americans' hard work and high energy, smart decisions in
    tough choices, and our invest-and-grow strategy, all these have worked
    together to produce this success.

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        Now, in the coming months, America will have to decide whether to
    stick with this strategy. Will we continue to engage the world economy
    by continuing to give normal trading status to China? Will Congress give
    the President the tools necessary to open new markets abroad for
    American products through tough new trade agreements? And above all,
    will we finish the job of balancing the budget while protecting our
    values?
        Earlier this month, I reached agreement with the leaders of Congress
    on a bipartisan balanced budget plan that will continue our economic
    strategy into the next century. This is a balanced budget plan that also
    is in balance with our values. It will eliminate the budget deficit by
    2002, honor our parents by securing the Medicare Trust Fund for a
    decade, preserve our environment through strong enforcement and the
    cleanup of 500 toxic waste sites, and protect the next generation by
    extending health insurance coverage to as many as 5 million uninsured
    children. And most important of all, it will invest in the skills of our
    people through the most significant increase in higher education since
    the GI bill half a century ago, the expansion of Head Start, and an
    investment in higher national academic standards for our children.
        Both Houses of Congress moved forward on this budget before they
    left town for the Memorial Day recess. I was pleased that a strong
    majority of both parties supported this bipartisan plan. When Congress
    gets back to work, it's time to finish the job of enacting the broad
    outlines of the budget plan. Then in the weeks to come, Congress will
    fill in the details and begin writing this budget and its tax cut into
    law. I want a tax cut that helps families raise their children and send
    them to college and keeps the economy growing. That's my goal.
        I look forward to continuing to work together with the Republican
    and Democratic Members of the tax writing committees in Congress to meet
    this goal as we write the details of the tax cut into law. As that
    process begins, I want to tell you three of the things this final tax
    cut plan should include.
        First, with education our most important goal, our tax cut must help
    open the doors of college to every American. Our bipartisan budget plan
    includes $35 billion in tax relief, targeted to help families pay for
    higher education. Our HOPE scholarship is a $1,500-per-year tax cut to
    help pay for the first 2 years of college and open them to all
    Americans. I will also recommend that students who already receive Pell
    grant scholarships can still receive the HOPE scholarship for education
    costs beyond those covered by their Pell grant. With this step, we'll
    make sure that our tax cut reaches all those who want to take
    responsibility for their own lives and go on to college. Beyond that, I
    favor a tax deduction for the cost of any education after high school
    for people of any age.
        Second, as many families as possible should have a chance to receive
    the dividend created by economic growth. Our plan will give families a
    $500 child tax credit. This is the kind of tax relief we need, targeted
    to helping families raise their children and meeting the competing
    demands of work and family. As we craft this tax cut, I believe it's
    especially important that we make sure that the child tax credit is fair
    to working families, especially those with lower incomes.
        Third, the tax cuts must be consistent with a balanced budget and
    must not be written in such a way that they reopen the deficit and bust
    the budget in years to come. This was absolutely key when we reached a
    budget agreement, and I will continue to insist on it as we write the
    agreement into law. Fiscal responsibility helped to produce a strong
    economy. Fiscal irresponsibility will surely undo it. We cannot put our
    prosperity at risk through time-bomb tax cuts that explode the deficit
    in 5 or 10 or 20 years. We must continue with discipline. We tried it
    the other way before, and it failed.
        We are now nearly 5 years into our economic strategy of invest and
    grow, and it is working, well beyond our most optimistic expectations.
    We have now an historic chance to continue this growth and give the
    American people the dividends of expansion through a tax cut. We can
    protect our values as we expand our economy. The American people deserve
    a tax cut, and they need a balanced budget. We can give them both. If we
    make sure that this tax cut helps all working families, that it opens
    wide the doors of college, and that it never, never throws the budget
    out of balance, we can propel our country into the 21st century even
    stronger than it is today.
        Thanks for listening.

    Note: The address was recorded at 7:30 p.m. on May 30 in the Map Room at
    the White House for broadcast at 10:06 a.m. on May 31.

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