    [Public Papers of the Presidents of the United States: William J. Clinton (1998, Book I)]
    [January 5, 1998]
    [Pages 3-4]
    [From the U.S. Government Publishing Office www.gpo.gov]

    Remarks on the Federal Budget and an Exchange With Reporters
    January 5, 1998

        The President. Good afternoon and happy new year to all of you. I'm
    glad to be back at work, and I'm looking forward to 1998.
        We can begin the year with some good news. I can now say that we
    believe that the deficit this year will be less than $22 billion. That
    means that it will decline for the 6th year in a row, a truly historic
    event. Twenty-two billion dollars is a far cry from the $357 billion the
    deficit was projected to be this year when I took office or the $90
    billion it was projected to be when the balanced budget agreement was
    enacted. So we have come a very long way.
        I can also say that the budget that I present to the Congress in
    February will be a balanced budget for 1999. Again, this will be the
    first time in 30 years we've had a balanced budget, and that's good news
    for the American people and for the American economy. It continues the

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    successful economic policy that we adopted beginning with the budget in
    1993, which was the first major step.
        We have followed a policy of investing in our people, expanding the
    sales of American goods and services overseas, and practicing fiscal
    discipline. We reversed 12 years of trickle-down economics in which the
    deficit of this country exploded year after year and our national debt
    was quadrupled. So we have taken a different course, and thanks to the
    hard work and productivity of the American people, it is working. And
    I'm very, very pleased about it.
        Now, what we have to do now is to build on it, first with the
    balanced budget to keep interest rates down and keep the economy
    growing, secondly with other policies which I will be outlining in the
    State of the Union. I welcome other people to the debate.
        But let me say, I want to caution everyone that I will do everything
    that I can to prevent anyone from using a projected future surplus as a
    pretext for returning to the failed policies of the past. We do not want
    to go back to the terrible conditions that paralyzed our Government and
    paralyzed our own people's potential in 1992 when I took office. We have
    to go forward.
        This is great news today. I'm very pleased by it. The American
    people should be pleased by it. But we should be determined to stay on
    the course and do what works. And that's my determination.
        Q. Are you ruling out a tax cut, Mr. President, with this surplus?
        The President. I do not--let me just say, I want to say just exactly
    what I said. We don't have a surplus. We can project a surplus, but we
    don't have one. And we've waited 30 years for a balanced budget. Between
    1981 and 1992, we projected all kinds of things and went out and spent
    the money on tax cuts and spending--both. We spent the money, and we
    quadrupled the debt, drove up interest rates, put our country in a
    terrible hole. We have dug ourselves out of that hole with a lot of
    effort and a lot pain. In 1993 it was a very difficult dig, and a lot of
    people paid a very high price for it. Then we had the overwhelming
    bipartisan support for the balanced budget.
        All I'm saying is that any policy we adopt must not--it cannot--run
    any risk of returning to the failed policies of the past. We got away
    from trickle-down economics; we're into investing and growing our
    future. We're doing it the old-fashioned way. I have been exhorting the
    American people for 5 years now to be responsible, to remember that we
    cannot have opportunity without responsibility. Well, that same rule
    applies to the Government. We have to set a good example. We have to
    create opportunity, and we can't do it unless we're also responsible.
        So whatever policies we adopt have to be within the framework of the
    budget to the best of our knowledge. We cannot take risks with the
    future that we have worked so hard to build.

    Tobacco Legislation

        Q. Mr. President, are you going to call for cigarette tax increases
    to help pay for new initiatives?
        The President. I will--first of all, on the tobacco issue
    generally--I'll have more to say about this later, but keep in mind what
    my first priority is. My first priority is to protect our children from
    the dangers of tobacco, from the illegal dangers of tobacco. And I will
    propose a plan that I believe is best designed to do that, that will
    build on the settlement agreement that was reached earlier. And I will
    work with Members of Congress in both parties in good faith to try to
    pass comprehensive tobacco legislation that I think will achieve that
    goal. And I'll say more about the details later.

    Press Coverage of President's Vacation

        Q. Mr. President, there's been some controversy today about whether
    the press invaded your privacy in St. Thomas. Do you feel your privacy
    was invaded, and where should the press draw the line, sir?
        The President. The answer to the first question is yes. The answer
    to the second question is that's why we have a first amendment; you get
    to decide the answer to the second question. But----
        Q. You didn't like your dancing picture? Everybody liked it.
        The President. Actually, I liked it quite a lot. But I didn't think
    I was being photographed.
        Q. Was it off limits, sir?
        The President. That's a question that you have to ask and answer.

    Note: The President spoke at 1:20 p.m. in the Cabinet Room at the White
    House prior to a meeting with the economic team.