    [Public Papers of the Presidents of the United States: William J. Clinton (1998, Book I)]
    [May 26, 1998]
    [Pages 837-839]
    [From the U.S. Government Publishing Office www.gpo.gov]

    Remarks on the Federal Budget and an Exchange With Reporters
    May 26, 1998

        The President. Thank you, Jack. And let me thank the other members
    of the economic team.
        This is of course very good news for the American people, as the
    chart shows. Now it's official that this year, well ahead of the most
    ambitious schedule, America has balanced the budget. In fact, as the
    chart shows, the achievement of the American people will not stop there;
    OMB predicts that the budget surplus will be $39 billion this year, the
    largest dollar surplus in our history, the largest surplus as a share of
    the economy in more than 40 years. America can now turn off the deficit
    clock and plug in the surplus clock.
        Given the speed with which our Nation has reached this remarkable
    milestone, it is perhaps all too easy to forget how hard it was and how
    far we've come. Just 6 years ago, because of the drag of deficits, our
    people were running in place; our Nation was falling behind. Interest
    rates were high, and so was unemployment. On the day I took office, the
    deficit was projected this year to be $350 billion.
        How did this greatest projected deficit in history turn into the
    greatest projected surplus? The old-fashioned way: We earned it. Our
    Nation earned it as a result of hard work by the American people. And as
    the Vice President said, we earned it here in Washington with the help
    of two visionary actions in Congress: first, the courageous vote by the
    Democrats in 1993 in the midst of withering, extreme criticism that led
    to a cut in the deficit of 90 percent; and then the truly historic
    bipartisan balanced budget agreement passed by Congress last year that
    finished the job.
        I think it would also be wrong if I didn't mention, as Mr. Lew did,
    that the reinventing government efforts headed by the Vice
    President played a major role. We not only
    have the smallest Government since the Kennedy administration, with more
    than 300,000 fewer people, we also have savings in excess of $130
    billion during the budget period as a result of those efforts. And Mr.
    Vice President, I am very grateful for what you have done.

    [[Page 838]]

        Now that we're about to have the first surplus since Neil Armstrong
    walked on the Moon, we face a crucial decision about what to do with it.
    We can use these good times to honor those who've put in a lifetime of
    work and prepare for the future retirement of the baby boomers by saving
    the Social Security system for generations to come, or we can give into
    the temptation in this election year to squander our surpluses the
    moment they start coming in.
        I think the choice is clear. We got to where we are today--with 4.3
    percent unemployment, more than 15 million new jobs, the lowest
    inflation in over 30 years, low interest rates, high growth, the highest
    homeownership in history--by doing what was right for the American
    economy over the long run. That is what we should do now. Social
    Security has been a cornerstone of our society for the last six decades,
    but the present system is not sustainable as we look forward to the full
    retirement of the baby boom generation. We have to protect it for the
    21st century.
        I was deeply heartened after I spoke about this at the State of the
    Union, that there were broad public statements of support from the
    leaders of both parties in both Houses in Congress about saving Social
    Security first. However, in recent weeks, senior Republican leaders in
    the House of Representatives seem to have retreated from that pledge. In
    this election year, some now want to raid the surplus for initiatives
    instead of preserving every penny of the surplus until we strengthen
    Social Security.
        We cannot ignore the long-term challenge, which we have a unique
    opportunity and responsibility to meet now, in favor of short-term
    schemes that, however popular in the moment, could compromise our
    future.
        Let me be clear: I will oppose any budget that fails to set aside
    the surpluses until we have strengthened Social Security for the 21st
    century. Let me also be clear: That does not mean that in the future
    there could never be a tax cut. It simply means that we need to know how
    we're going to pay for the challenges of reforming Social Security. Once
    we know that--and we should know that sometime next--I would hope early
    next year because of the work being done this year--then we can have a
    debate about what ought to be done if there are funds that still are
    unaccounted for and unobligated.
        Today, our economy is the envy of the world. But the progress was
    not predestined nor is its future guaranteed. We cannot abandon the
    strategy of fiscal discipline and investments in the future which has
    brought us to this moment.
        Instead, we should work together across party lines to maintain
    fiscal responsibility, to save Social Security first, to prepare for an
    even brighter future. Again, let me thank the members of the economic
    team, those who are here and those who preceded them, for their work in
    this remarkable effort and every Member of Congress whose votes have
    contributed to it.
        Thank you very much.

    Year 2000 Computer Bug

        Q. Mr. President, over the weekend, those same Republican leaders--I
    defer to Sarah [Sarah McClendon, McClendon News Service].
        Q. [Inaudible]--overcome the disruption which we face with the
    computers as millennium starts April 1st, 1999. That will disrupt all--
    --
        The President. Well, let me say that we're very concerned about
    that, Sarah, and I asked John
    Koskinen, formerly a deputy at OMB and
    before that a man who had a very distinguished career in the private
    sector, to come back into public service to supervise and coordinate our
    efforts to deal with the computer 2000 problem.
        It's not something that grabs the headlines every day, but it is in
    fact a profound challenge, not only for the United States but for every
    country--which is every country now--that has extensive reliance on
    computers. And there are a lot of very complex questions. There are
    computer hookups where people at both ends have computers that can be
    programmed to move easily to 2000, but there's something in the
    connection in between which won't. So this is a very complicated
    problem.
        Interestingly enough, we discussed it in some detail at the G-8
    meeting in England recently, and I can tell you that we are working very
    hard on it. We're working very hard, first of all, to monitor the
    progress of every Government agency to see that they're ready, and some
    are doing better than others because some have more profound challenges
    than others. And secondly, we want to do what we can to be supportive of
    the private sector in the United States and their efforts to make these
    adjustments. But it is a very big problem.

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        And I would urge--since you've asked the question, I would urge
    everyone in America who hears this exchange to make sure that they have
    done everything they can do within their own business sectors to be
    ready for this.
        And we also agreed, by the way, when I was in England, to work with
    other countries so that we can help share information and do everything
    we can do make sure that when the new millennium starts, it's happy
    event and not a cyberspace headache.

    President's Trip to China

        Q. Mr. President, over the weekend Republican leaders called on you
    to postpone your trip to China, or at the very least, not have a
    welcoming ceremony in Tiananmen Square. What will you do, sir?
        The President. I think it would be a mistake to postpone the trip to
    China. Our partnership with China has succeeded in persuading the
    Chinese not to transfer missile technology and other dangerous materials
    to nations that we believe should not have them. We have seen some
    advances on the human and political rights fronts recently. We have
    worked closely with them in North Korea. Today, we are working with them
    to try to diffuse the tension and prevent a new nuclear race in South
    Asia.
        So I think we have a broad range of issues to deal with, and I think
    we have enough evidence now to justify the partnership that we've had.
    So I believe we ought to go forward.

    Note: The President spoke at 11:32 a.m. in the Rose Garden at the White
    House. In his remarks, he referred to Jacob J. Lew, Acting Director,
    Office of Management and Budget.