    [Public Papers of the Presidents of the United States: William J. Clinton (1999, Book I)]
    [February 25, 1999]
    [Pages 258-264]
    [From the U.S. Government Publishing Office www.gpo.gov]

    Remarks to the Community in Tucson, Arizona
    February 25, 1999

        The President. Thank you. Thank you. I was just wondering if
    Esther would agree to go back to Washington
    with me. That was amazing. [Laughter]
        Thank you for your wonderful welcome. I had no idea when I got here
    that I was coming to a place so large or so beautiful or completely
    full, with a good crowd outside. And it's a real testament to your good
    citizenship. You can't imagine, as Congressman Kolbe said, what this
    weather looks like to us. It has been freezing in Washington. And I come
    here--and I'm sort of a sports fan--you've got three teams in spring
    training; you've got this great golf tournament going on here; and here
    you are with me. Thank you very much. I'm very grateful.
        I'd like to thank Mayor Miller for meeting
    me at the airport and being here today. And he and his wife met me, and it's her birthday today--I hope she's
    enjoying this unusual celebration of her birthday.
        I thank County Supervisor Sharon Bronson
    for her remarks and her presence here today. And Congressman
    Kolbe, thank you for crossing district and party
    lines to be here with us today. We appreciate it very much. I thank you
    good friend, Ed Pastor, and his wife,
    Verma, for their friendship and support and
    leadership over the years. I thank him for that.
        I know Attorney General Janet Napolitano and several legislators and tribal leaders and others
    are here. I thank them for being here. I think the Director of the Pima
    County Council on Aging, Marian Lupu, is here. I
    was told before I got here that Linda Ronstadt and CeCe Peniston are here,
    and if they are, thank you for being here. And if they're not, I'm
    giving them free publicity. That's okay, too. [Laughter]
        You know, I'm delighted to be back in Arizona; I'm delighted to be
    here. Ed told me that I am the first President to come to Tucson since
    President Ford. If that's true, the others didn't know what they were
    missing, I can tell you that. I'm not sure, but I believe this is the
    first time I've had the opportunity in Arizona to thank the people of
    Arizona for their support for the Vice President and me in 1996, and I'm
    very grateful for that.
        This State is living proof that the great era of westward expansion
    did not end a century ago; it is still going on. And when I look out
    here at all of you, I am reminded that when America looks to the west,
    it still sees the future. We see in Arizona the glimpses of America's
    future, and the seismic shifts in population, and growth you are already
    undergoing.

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        The mayor mentioned Hillary--the one thing--I wanted to say this:
    the one thing Hillary said to me this morning, only half kidding, before
    I left--I said, ``You know, look at this. This speech begins by saying,
    Arizona is the mirror of the future, all these shifts in population.''
    She said, ``Yeah, there's another way it's a mirror of the future, too.
    The women are in charge at last.'' I think my political career just got
    in there under the wire. That's what I think. [Laughter]
        Let me say to all of you, we've had a good time today, and I am
    delighted to be here. But I do want to take a few moments to have a
    serious discussion with you about what I believe we should be doing in
    this last year of the 20th century. And I think it is terribly
    important, because the United States is so fortunate today to have the
    longest peacetime expansion in our history and the lowest peacetime
    unemployment since 1957 and all the other economic indicators you know
    well. We're in our second year of budget surpluses after 30 years of
    deficits. Welfare rolls are about half what they were 6 years ago. We
    are so fortunate.
        But the tendency is for people in public life and positions of
    responsibility and for citizens at large, after having gone through
    difficult and challenging times, when things get a whole lot better and
    ordinary folks can finally begin to feel it, to see it in the highest
    homeownership in our history, for example, the tendency is to say, whew,
    and to relax, and to basically just enjoy this moment or to think about
    other things, or to get distracted. And I believe that would be an
    error.
        And I ask you to come here today to join with me in thinking
    seriously about our future, because this prosperity we have and this
    confidence we have gives us not only an opportunity but an obligation to
    try to deal with the long-term challenges America faces. That's what I
    attempted to talk to the American people about in the State of the
    Union. I want to mention a few of them today and then focus on the ones
    that have already been discussed.
        There's one other person, though, I will not forgive myself if I
    don't introduce, a native of Arizona and a very important member of my
    personal White House staff, Mr. Fred DuVal. So I
    wanted to introduce Fred. Thank you very much.
        One of the big challenges you face in Arizona that all America will
    have to face is, how do we preserve the environment as we grow the
    economy; how do we maintain what you all came to California--I mean, to
    Arizona--for in the first place? [Laughter] While you have sustained
    records--economic growth. If you moved here to Arizona, if you're not
    like Esther and you weren't born here, if you moved here, it puts you in
    an awkward position to say you wish other people would stay home,
    doesn't it? So the question is, how do we sustain growth as a country,
    knowing we're going to put more pressure on our natural resources, and
    knowing we have local problems like preservation of green space, other
    natural heritage, quality of water, quality of air, not having toxic
    sites, and that's all somehow connected to a lot of global problems like
    the warming of the climate?
        This is a major challenge. I know that you are working on it. When
    the mayor met me at the airport he gave me a shirt that I'm going to try
    to wear out to spring training when I leave you--on the Bellota Ranch,
    which you have preserved, I think 10 or 12 miles from here--the kind of
    thing we ought to be doing more of.
        And so one example of what we're trying to do to help you deal with
    the future is the livability agenda that I talked about a little bit in
    the State of the Union, that the Vice President and I developed, that
    will give communities new tools and new resources to deal with whatever
    the major challenge is in any community to making it more livable,
    whether it's reducing traffic congestion or saving green space or
    promoting smart growth.
        We also have to recognize that we're not yet giving all of our
    children a world-class education, so in the State of the Union I talked
    a lot about how we can build a 21st century education for every American
    child, from putting more teachers in the schools, to building or
    modernizing 6,000 schools, to having more summer school and after-school
    programs, to having more charter schools and Internet hookups for all of
    our classrooms. These things are very important. And Arizona has growth
    challenges and diversity challenges there as well.
        We talked a lot about--in the State of the Union, I talked a lot
    about the need to bring economic opportunity to the communities and the
    people that still haven't been part of the recovery, whether they're in
    urban areas or isolated rural areas or Native American reservations. We
    have a program now--if we can't get

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    investment in there now when unemployment is low and when money is
    ample, if we can't get private investment to prove free enterprise will
    work for all Americans who will work, we'll never get around to doing
    that. So I think that is a very important thing for us to do now, and I
    hope you will support that.
        But for the next few years, all of these major challenges will be
    overshadowed by two great decisions: How do we deal with the aging of
    America; and what are we going to do, now that we finally have a budget
    surplus, what are we going to do with it? And I want you to think about
    that.
        You know you are on the cutting edge of the aging of America. Here
    in Pima County alone, there are an enormous number of people over 65;
    the number has doubled just since 1980. The number of Americans over 65
    in the entire country will double within 30 years. Life expectancy is
    already 76 years-plus in America. If you get to be 65 years old, your
    life expectancy, on average, is already over 80, well over 80. People
    over 80 are the fastest growing group of Americans. Esther's just one of
    the crowd there--[laughter]--and her family.
        So what does all that mean? Well, it means that before you know it,
    there will only be two people working for every one person drawing
    Social Security. It means even before that, there will be many, many
    more people on Medicare, and the older you get, the more you tend to
    access health services. And even staying healthy often costs money.
        If you look at that, when the baby boomers retire--we had to wait
    two generations. It's not until--this group that's now in the schools
    today is the only group of Americans more numerous than the baby boom
    generation. I'm the oldest of the baby boomers, I was born in 1946----
        Audience member. Me, too. [Laughter]
        The President. It looks better on you. [Laughter]
        And those of us in the next 18 years are the so-called baby boom
    generation--we retire, there will be two people drawing--working for
    every one person drawing Social Security. And even before that, as I
    said, there will be great pressures put on the Medicare program because
    we're living longer, and we have more access to high-tech medicine, but
    we access it more.
        Another thing that's important for you to remember is that Social
    Security is not just a retirement program; it's an insurance program.
    One-third of the investments that are paid out in Social Security go to
    people who become disabled or to the survivors of people who die
    prematurely from accidents, disease, and other things. And when you
    think about what you're getting out of Social Security, particularly if
    you're not drawing it yet, don't forget that every year you have the
    equivalent of a term insurance policy that's issued every year against
    disability or death. All over America, I meet people who literally would
    not be able to get along were it not for these benefits.
        So here's the problem: Everybody likes Social Security; everybody
    likes Medicare; and we can't sustain the programs unless we make some
    changes, both changes in the structure of the program and investing more
    money.
        Now, thank goodness we now have a surplus. We're in the second year
    of surpluses, and we project that, on average, we'll have them for at
    least another 25 years. That doesn't mean that we won't have bad
    economic years, but on average, year-in and year-out, we'll have them,
    and that's good.
        Now, in the State of the Union Address, as Esther said, I proposed
    setting aside for 15 years 62 percent of the surplus for Social Security
    and 15 percent of it for Medicare. And I'd like to talk a little about
    that. I propose to do it in a way that will enable us to pay down the
    national debt with the surpluses but as we pay the debt down, to commit
    the money that we're using to pay the debt down when it comes back in,
    when it's manifested in the out-years, to commit future years money to
    Social Security and Medicare.
        Now, if we do that, every young person in the audience should be for
    that, not just because it would guarantee that you would get Social
    Security and Medicare but because if you pay the debt down, as I'll say
    more about in a minute, it will immeasurably strengthen the American
    economy. And keep in mind, it is the strength of our economy that is
    enabling us to have this whole conversation today. If we still had 8
    percent unemployment and a $200 billion deficit, we'd be letting
    somebody else think about this down the road.
        Now, I want to say, first of all, that I am very encouraged that
    there are more and more Members of Congress like the two here, Ed
    Pastor and Jim Kolbe, who
    are committed to seeking reasonable solutions to these challenges, and
    who want to set aside--there seems now

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    to be broad agreement among leaders and rank-and-file members in both
    parties of Congress to set aside the lion's share of the surplus to save
    Social Security.
        There seems to be, now, some movement in the Republican majority
    away from having a large across-the-board tax cut if it would take away
    from the surplus' ability to save Social Security. We don't yet have
    that kind of agreement on setting aside some of the surplus for
    Medicare, and I think we should. And I'm going to keep pushing for that,
    because I think it's important--and I'll explain more about that in a
    moment--because I think we have to have both Social Security and
    Medicare fixed by the end of this year.
        Now, I can tell you--if you look at what this surplus is projected
    to be over the next 15 years, if we did what I asked, there would still
    be a substantial amount of money out of which you could have targeted
    tax cuts, which I think the best are the USA accounts, the savings
    accounts I proposed, because most people need help saving for their
    retirement. But you could have a targeted tax cut; you could have
    investments for defense, for education, for medical research. There's
    still money there.
        But keep in mind: When you save money, if it doesn't materialize,
    you just didn't save quite as much as you meant to. Once you give the
    tax cut, the money is gone. So we're giving it back to you, and it was
    all your money in the first place. And that's good. But if you want us
    to fix Social Security and Medicare, you should want us to make sure
    that we invest enough to do that. And if we do it--[applause]--thank
    you.
        Now, let me just tell you basically what I propose to do. What I
    propose to do is to take 62 percent of the surplus, commit it to Social
    Security, and pay the debt down. And what I believe we should do is to
    invest a modest amount of this in the private sector, the way every
    other retirement plan does. The Arizona State retirement plan does;
    every municipal retirement plan does; every private plan does. But I
    don't want to see the Government having too much influence over the
    stock market, so I proposed to set up a totally independent board, like
    every other retirement plan has, that no politician can have any
    influence over, and then to limit the aggregate amount of our
    investments to about 4 percent. It would never get over 4 percent over
    the next 20 years.
        There's some differences about that, but if you do it, you'll
    increase the rate of return on Social Security. When only two people
    work and one person draws, you have to find some way to do it. Mr.
    Kolbe's got a different way he thinks is better.
        But here the point I want to make: If you set aside 62 percent of
    the Trust Fund for Social Security, it will extend the life of the
    Social Security Trust Fund to 2050, maybe another year or two, depending
    on how much longer the economy stays in good shape.
        But there are three other things we need to do, and I want you to
    think about it. Number one, historically, to have a good retirement
    system with Social Security, we've always thought we ought to have it
    alive for 75 years. Number two, the rate of poverty among single elderly
    women is over 18 percent, nearly twice the general rate of poverty among
    seniors, and we need to make some adjustments in the program to lift
    them out of poverty, I think. Number three, I think it's a mistake, when
    more and more seniors are living longer and living healthier, to
    continue the earnings limitation on Social Security, that limits what
    people can earn. And interestingly enough, if you lift the earnings
    limitation, it actually costs the Trust Fund money in the short run
    because a lot of people start collecting their Social Security. But
    within a matter of a few years, it starts making money, because even
    retired people who earn income pay taxes on it, so after a certain
    period it will actually start replenishing the Social Security Trust
    Fund.
        Now, to do that, to do that we will have to make some other changes.
    And to do that, we will have to make some changes that will be perhaps
    somewhat controversial, that will have to be made in a bipartisan
    fashion. But the changes won't be nearly as dramatic, nearly as big, and
    nearly as troublesome as they would be if we didn't commit the surplus
    in the first place.
        So I hope that you will support this idea of committing the surplus
    and then you will tell--we're down in Ed's
    district now--tell him that you know he wants to preserve Social
    Security; you know he wants to take care of the people that have to be
    taken care of; and you will trust him to go up there and make some
    decisions that may be somewhat controversial today; but 10 or 20 years
    from now we'll all be thanking goodness that the Congress of the

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    United States was willing to do what it takes to save Social Security
    for 75 years. And I think that's important.
        Now, let me say furthermore, on Medicare, here's the problem. We've
    made a lot of changes in Medicare to try to cut down on fraud and abuse,
    and there was a bunch of it. Right now, the Trust Fund in Medicare is
    stable for 10 years; that's the good news. Here's the bad news: Ten
    years is not enough. We ought to stabilize it for 20 years.
        And as probably most of you have noticed, inflation in the cost of
    health care has gone way down the last few years. Health insurance
    premiums have not been going up very fast; we've got them back in line
    with inflation. When I became President, for many years before that,
    health insurance premiums had been going up at 3 times the rate of
    inflation. But a lot of the savings, the easy savings that could be
    squeezed out for managed care--and some not so easy, which is why I'm
    for the Patients' Bill of Rights--a lot of those savings have been
    squeezed out. So this year, it is estimated that health insurance
    premium costs will increase about 7 percent, whereas the general rate of
    inflation will be just a little over 2 percent.
        So you can see that that's a real problem. We can't sustain the
    present budgeted costs of Medicare. We're going to have to put some more
    money in it. If we put 15 percent of the surplus aside for Medicare for
    20 years--15 years, we could take the Trust Fund out from 2010 to 2020.
        Now, I would also like to see us begin to work into Medicare a
    prescription drug benefit, which I think would dramatically improve it.
    But keep in mind, the program doesn't have enough money now. We've got
    to be careful how we do it, because you could spend a whole lot of money
    in a hurry and give people who may not need it the benefit. But if you
    think about it, we're spending--we've had a remarkable bipartisan
    consensus. You know, you wouldn't think we ever agreed on anything, I'm
    sure, out here. [Laughter] Once in a great while we all agree on
    something. And one of the things that we've had real agreement on ever
    since I've been in Washington, for the last 6 years, has been to
    dramatically increase spending for medical research.
        And some of the findings are breathtaking. We've uncovered the genes
    that give a strong predisposition to breast cancer. We've done nerve
    transplantations in laboratory animals from legs to spines that have
    actually cured broken spinal cords in laboratory animals, just
    unbelievable things that have breathtaking potential for the future. But
    if we're investing all this money to try to come up with medicine, for
    example, that helps to keep people well or to cure conditions that were
    formerly incurable, that dramatically improve the quality of life, we
    want to be able to bring those into the lives of the American people.
        And if you're worried about people, in effect, as we get older,
    putting enormous burdens on the hospital costs, which is all the money
    is--you know, hospital and doctor visits--if we can work out the right
    sort of prescription drug benefit, we'll actually save money over the
    long run because people will stay out of the hospital, they'll stay out
    of costly medical care, they will stay healthy. So we have to work hard
    to kind of get this right.
        So again, my proposal is, set aside 15 percent of the surplus for
    Medicare, take the Trust Fund out to 2020, but recognize we're going to
    have to make some changes there for the same reason we have to make some
    changes in Social Security and especially if we want to add a
    prescription drug benefit for the people who really need it.
        Now, that's the general outline of my proposal. But I also want to
    emphasize, if you save the surplus for 15 years--we save a little over
    three-quarters of this surplus for 15 years and used it to buy into
    publicly held debt and to pledge the future revenues to Social Security
    and Medicare, here's what would happen. We would go from a national debt
    that today was quadrupled between 1981 and 1993--we quadrupled the debt,
    and it was 50 percent of our annual income--today it's down to 44
    percent of our annual income. In 15 years, it will be down to 7 percent
    of our annual income. The last time it was 7 percent of our annual
    income was 1917, right before we went into World War I.
        What does that mean to you in practical terms? This is where I want
    the young people in the audience to listen. It will mean that the
    Congress that meets 15 years from now, instead of having to take 13-plus
    cents of every dollar you pay in taxes right off the top to pay interest
    on the debt, we'll be spending 2 cents of every dollar you pay in taxes
    to pay interest on the debt.

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        In the early years, most of the difference will go to fix Social
    Security and Medicare. But over time, that's a huge amount of money that
    can be invested in the needs of future generations. It can be providing
    for tax cuts; it can be providing for anything out in the country when
    we get this debt off.
        But what I want the young people to understand here, especially is
    if we start paying this debt down and we go all the way, if we stay on
    this trajectory we could be debt-free for the first time in 2018. That's
    just 19 years from now. And in the meanwhile we'll have lower interest
    rates, higher investment, more investment in new business and new jobs,
    home mortgage rates will be lower, credit card payments will be lower,
    car payments will be lower, student loan rates will be lower, and the
    economy will grow faster. Now, I want you to think about it. Why will
    that happen? Because the Government will not be going in and taking up a
    bunch of money every year to finance the deficit. So interest rates will
    go down, savings will go up, investment in our future will go up.
        So this proposal is good for younger people for two reasons: This is
    not--for one thing, people on Social Security now don't have to worry;
    it's going to be fine for 30 years. You don't have to worry. Now, you
    do, most of you on Medicare, have to worry because it's not going to be
    fine after 10 years if we don't fix that.
        But every American of every age should care about this. Why? Well,
    for one thing, I can tell you as the oldest of the baby boomers, I spend
    a lot of time--I stay in touch with the people I grew up with, a lot of
    them. Most of them are just middle-class people, the kind of people who
    live here in Tucson. And my whole generation is obsessed with the
    thought that our retirement, because we're such a large group, would put
    an unacceptable burden on our children and their ability to educate and
    raise our grandchildren. And if we fix Social Security and Medicare,
    then our children will have more of their disposable income in those
    years to build their families, their quality of life, and their
    children's future. That's why this is not just a seniors' issue.
        Secondly, if we pay down the debt, the major beneficiaries of those
    changes will be the younger people. You know, there's been a lot of
    trouble in the world economy the last couple of years. Last year it was
    terrible. I have worked very hard to try to turn it around. I will do
    everything I can this year to make some major strides forward, because a
    lot of our prosperity depends upon the prosperity of our trading
    partners. But our ability to control what happens beyond our borders is
    somewhat limited, as all of you understand. I can tell you this: If we
    pay this debt down, whatever bad times come in the future won't be as
    bad as they would have been by a long shot. And whatever good times come
    in the future will be much better than they would have been because of
    this.
        So I say again, I haven't tried to give you a traditional political
    speech today; we're just having a talk. And I appreciate how--I very
    much appreciate how quiet you've been and how you've listened to this.
        There are some promising signs in Washington. I met with the leaders
    of both parties in both Houses, a couple of days ago. There's some
    indication that there is--I think there is an agreement that we have to
    use the lion's share of the surplus to save Social Security. There is, I
    think, some movement toward reaching some consensus about the nature of
    tax cuts, if they ought to be targeted and benefit the people that need
    it most and try to not get in the way of saving Social Security. We're
    not there on Medicare yet, and the Medicare problem will come sooner.
        But we need to hear--the people of this country need to make a
    decision. And this is maybe a fairly complicated scenario I've laid out
    for you. I know it would be a lot more popular to say, ``We've got a
    surplus. It's your money. I'm just going to give it back to you.'' And
    then you could all cheer; and I could go home; we'd go watch baseball or
    do something else. [Laughter]
        But what I want to say to you is, this is a high-class problem. This
    is nothing to wring your hands about. The reason we have this Social
    Security and Medicare problem is because we've got the best medical
    science in the world and because we're all living longer. This is not an
    occasion for handwringing. The older I get, the better I like this
    problem. [Laughter] This is a high-class problem.
        But we have a responsibility to the future. This country's still
    around here, after more than 200 years, because whenever the chips are
    down and we had to make a decision about what kind of country we were
    going to be and what kind of future we were going to have, we did the
    right thing. And we kept going forward.

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        And the decisions that we make, not just in the Congress and the
    White House, but as a people, about whether we're willing to take on the
    challenge of securing Social Security for the 21st century, whether
    we're willing to do the same thing for Medicare, and whether we're
    willing to save a substantial part of this surplus to do those things
    and to pay this debt down, will shape, in large measure, what America is
    like for the young people in this audience and their counterparts
    throughout the United States.
        This is a wonderful time to be in the United States. We can all be
    grateful, because the truth is that no one, not even the President,
    could have predicted that the results of our attempts to reduce the
    deficit, to bring interest rates down, would have produced these
    results. And no one can claim sole credit for it. This is a shared
    achievement of the American people. And we should be proud of it.
        So as we go back to Washington and we go back to work, I ask you
    here--and I ask you to talk to your friends and neighbors in Arizona--
    when you're on your phone with your friends and family members
    throughout the country, I want you to tell them about this meeting
    today. And if you don't remember anything else, just remember, if we
    save about three-quarters of this surplus for Medicare and Social
    Security and if we pay the debt down with the surplus and then if we
    have the courage to make some decisions that may sound a little tough--
    to save Social Security for 75 years, fix Medicare for 20 years, and get
    the debt down to where it's virtually nonexistent--America is going to
    be a stronger, better place.
        These programs will be there. These programs will be there for the
    next generation of Americans, but America will be there--America will be
    there--brighter, better, stronger than ever before.
        Thank you, and God bless you.

    Note: The President spoke at 12:35 p.m. in the Music Hall at the Tucson
    Convention Center. In his remarks, he referred to senior citizen Esther
    Don Tang, who introduced the President; Mayor George Miller and his
    wife, Roslyn; Verma Pastor, wife of Representative Ed Pastor; and
    entertainers Linda Ronstadt and CeCe Peniston.