[Public Papers of the Presidents of the United States: WILLIAM J. CLINTON (2000, Book I)]
[February 7, 2000]
[Pages 193-197]
[From the U.S. Government Publishing Office www.gpo.gov]



Interview With Willow Bay of Cable News Network's
``Moneyline News Hour''
February 7, 2000

Economic Prosperity

    Ms. Bay. Mr. President, did you ever imagine in your most optimistic 
of dreams when you first took office, think that you would see a 
prosperity like the one we have today?
    The President. The truth, I guess I didn't, because I never thought 
about it. I literally never thought about how long the longest expansion 
was in history. But what I did believe is that there was this enormous, 
pent-up potential in the American people because of all the 
restructuring of industry that went on in the tough years in the 1980's, 
because of the power of technology which has only grown exponentially 
since I've been in office, because I thought the American people 
understood the global economy and were willing to work hard and not make 
excessive wage demands and get their pay increases as their companies 
grew--all that turned out to be true.
    So I just thought if I could remove the Government-related obstacles 
to growth by getting

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the deficit down and getting interest rates down, that good things would 
happen. But no, I can't say that I even thought--it never crossed my 
mind that it would happen.
    Ms. Bay. So in your mind, in some ways, was it unleashing a 
potential that already existed?
    The President. Yes. Yes. I think the main role of Government in a 
global economy like this, and where growth has to come out of the 
private sector, is to create conditions and give people the tools to do 
the best they can. And so, to me, the Deficit Reduction Act in '93, the 
Telecommunications Act, the Balanced Budget Act of '97, saving the 
surplus, all these things are designed to create the conditions and give 
people tools. That's why I think all this investment in science and 
technology and having a lifetime training system is important. And then 
the American people will do the rest. I think we have the highest 
percentage of new jobs, nearly 21 million now since 1993, in the private 
sector of any government--excuse me--any economic expansion in our 
history. They're almost all, way over 90 percent, private jobs.
    Ms. Bay. As you have noted, we have built a new economy. What is the 
most important thing, most effective thing you can do as President to 
keep that economy going strong?
    The President. I think, stick with the present economic strategy 
first, keep paying the debt down, keep the interest rates down, keep the 
confidence up, continue to invest in education and training and science 
and technology, and do more to expand trade. I think that's the most 
important thing.
    Then I think we have to continue to look for any impediments to 
continued growth. For example, I think over time the Telecommunications 
Act and the Financial Modernization Act will help a lot. And I think we 
have to look for other things. That's why I think this new markets 
proposal I've made is not going to be valuable just to help poor 
communities and poor people get investment; I think it will keep growth 
going without inflation, because it's a new way to bring expansion to 
areas which haven't enjoyed it.
    Ms. Bay. Do you really believe this is a new economy? Because, as 
you know, many on Wall Street say this is a boom, like others we've 
seen, and it will come to an end. What in your mind distinguishes it as 
different, other than its length?
    The President. I think there are two things that are different here. 
First is the role of technology. And let me say, I'm like the people on 
Wall Street to the extent that I don't pretend that we've repealed the 
laws of supply and demand, nor do I think we have repealed the potential 
for human error. So, of course, it could come to an end, and it probably 
will some day. But what is really distinguishing here is the role of 
this new high-tech world and the way it rifles through every sector of 
the economy.
    The high-tech economy itself, basically the Silicon Valley type 
companies, they account for 8 percent of our employment but 30 percent 
of our growth. That understates their impact because computer technology 
is going through every kind of work. And the reason the traditional 
economists, including ours, didn't anticipate this level of growth--that 
you could get down to 4 percent unemployment without any inflation--is 
that they underestimated the productivity impact of technology. So I 
think that's the first thing.
    The second thing is, keeping our markets open has not only given us 
a wider range of consumer choices and more competitive pressures, it's 
kept inflation down, because if we had a more closed market, then these 
buildups would not have the outlets they have--whether it's in 
homebuilding or whatever.
    Ms. Bay. Do you worry at all, though, with our enthusiasm about this 
prosperity, with our genuine excitement over the technological 
revolution that we're witnessing, that we are convincing folks that this 
really is a boom without end?
    The President. Well, I think that's what Chairman 
Greenspan is trying to caution against. He's 
trying to make sure that we don't go so fast we play it out prematurely. 
And I think that's what he's tried to do in the years we've worked 
together.
    I think it's important not to overpromise, not to overclaim, but I 
also believe all the evidence is that there's still a lot of creativity 
left, there's still a lot of room for new investment, there's still a 
lot of room for growth if we remember the fundamentals: Keep investing 
in science and technology, keep investing in education and training, 
keep paying the debt down, and keep the markets open, and keep expanding 
our markets. I think if you stay with that--obviously something could go 
wrong, but I think if we're

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not overpromising and we're on a steady course, I think we'll continue 
to have growth.

Fiscal Year 2001 Federal Budget

    Ms. Bay. Your final budget was delivered to Congress today. On the 
surface, at least, it looks as if you're loosening the reins on spending 
a bit, revising the spending caps. Why should Americans want their 
Government to spend a little bit more in 2001?
    The President. Well, first of all, the last couple of years we've 
spent more, and last year the Congress just shredded the spending caps. 
They just did it by calling certain normal expenditures emergencies. So 
this is basically a straightforward budget. I took the spending levels 
of last year and I said, let's not pretend anymore that we don't want to 
add at least inflation to education, to medical research, to the 
environment, to health care. We know we're going to do that. So let's 
project for the next 5 years that we'll have last year's spending plus 
inflation, and then we'll argue about the categories of growth.
    But I think Americans should want us to invest more. We've cut 
spending for quite a long while. As a percentage of our economy, Federal 
Government spending is the lowest it's been since 1966. The size of the 
Government is the lowest it's been in 40 years. So what we should do, 
now that we've trimmed down, now that we've got a surplus, we should 
keep paying the debt down, but we ought to invest more, I believe, in 
education, in science and technology, in health care, to help parents 
balance the needs at home and at work. And I think we can afford a 
modest tax cut, which I also believe is important.
    Ms. Bay. You've added some revenue raisers, like closing some 
corporate tax loopholes--likely to be a rather tough sell in Congress. 
If you don't accomplish those, do your numbers still work out?
    The President. Well, if all the numbers don't work out, we'll have 
to spend less or have a smaller tax cut. Because to me, the only number 
that has to work out is we've got to keep paying the debt down; we've 
got to not jeopardize our ability to take care of Social Security when 
the baby boomers retire; and we've got to hold back enough money so that 
Medicare stays stable and doesn't throw the whole budget out of whack or 
otherwise severely hurt seniors over the next 15 or 20 years.
    So, to me, those are the key things, and everything else operates 
from that framework. So, for example, if they decide not to close some 
of the corporate loopholes, so we have however much less money that is 
over a 5-year period, then we'll either have to spend less or we'll have 
to have a smaller tax cut.
    Ms. Bay. John Kasich, chairman of the House Budget Committee, 
declared your budget dead on arrival. How tough a battle are you likely 
to face?
    The President. Well, that's what they said in '99, and we got most 
of it; that's what they said in '98, and we got most of it. If our crowd 
will--the people that agree with me--and they're not confined solely to 
the Democrats--we have almost 100 percent support, I think, in our party 
for our budget approach because we believe we should invest more in 
education; we believe we should invest more in health care. But I think 
there are also quite a number of Republicans who agree with us. So I 
think if we just relax and stay tough until the end of the year, we'll 
do fine, just like we have in the last several years.
    Ms. Bay. What are likely to be the most contentious issues?
    The President. Well, I think the contents of any tax cut will be 
contentious. I don't believe the Republicans this year will contest me 
on the size, because I think they've seen even in their own party that 
Americans don't want to run the risk of going back to deficits. They 
know this strategy is working.
    But I feel strongly that we should focus the tax cuts on the needs 
of middle class families, like to pay for college tuition, long-term 
care for elderly and disabled relatives, expanding the earned-income tax 
credit for poor people, a genuine easing of the marriage penalty for 
people in the middle and even in lower middle income groups. But we 
ought to focus it there. I think they have some different ideas; we'll 
fight about that.
    I think that a lot of them don't support our efforts to put 100,000 
more teachers in the classroom, so we're going to fight over that for a 
third year. But we got it the first 2 years. And of course, they're 
against, by and large, they're more against the Patients' Bill of Rights 
than I am. I hope they'll raise the minimum wage, but some of them won't 
want to. So we'll have plenty to fight about.

[[Page 196]]

Tax Reform

    Ms. Bay. Do you think it's likely you'll see an easing of the 
marriage penalty? I know it's a hot topic of conversation right now.
    The President. I do. Because I want to have a genuinely constructive 
atmosphere, I put a proposal to them on the marriage penalty because I 
know that's something they've always thought was important, too. And all 
I asked them to do was to confine their bill to the marriage penalty 
issue and to give a little relief to people in the lower income of the 
scale, too.
    Their marriage penalty bill, in addition to easing the marriage 
penalty, has a whole lot of other stuff in it. So if they'll meet me 
halfway, we'll work something out. I think there's a fair chance we'll 
get that.

Debt Buybacks and the Bond Market

    Ms. Bay. There was an interesting situation last week, caused 
largely by the surplus. As you know, the Treasury announced plans to buy 
back some of its debt and reduce the supply of new debt. It caused a 
fair amount of turmoil in the bond markets. Were you surprised by that 
kind of reaction in the bond market?
    The President. A little bit, only because we had made clear several 
weeks before that we might want to buy some of our debt in early. If it 
had been the first time it had ever been mentioned, I wouldn't have been 
so surprised. And there is a debate going on now about whether it's even 
a good thing for us to pay ourselves out of debt, because there are some 
people that believe we have to have enough publicly held debt to 
establish the bond market, which is a, if you will, a barometer for the 
overall financial framework of the capital markets.
    But my concern is, we financed this expansion privately. There is 
quite a lot of private debt outstanding; it doesn't look at all 
troubling today because there is so much private wealth outstanding. But 
I just don't want to run the risk of the thing getting out of balance. 
So I think as long as we're growing this way, the Government should 
continue to pay down the debt. And we have to buy in the bonds to do 
that.
    Ms. Bay. Could or should the Treasury have done anything to manage 
the bond market more effectively, particularly given that this is 
unprecedented and likely to be an ongoing concern?
    The President. I don't know the answer to that because, as I said, 
my--unless my memory is totally out of whack here, I think we announced 
several weeks earlier than that, we plan to buy the bonds in, and some 
of them would be brought in before term. So I think Secretary 
Summers is a very smart man and he 
understands this and he talks to people in the private sector all the 
time, and I think they'll do it the best way they can.
    But just yesterday Chairman Greenspan said again that he thought the 
best thing that we could do in the executive branch would be to continue 
to take the debt down, and he hoped Congress would cooperate. So I think 
we're all--if we're wrong, we're all wrong together, anyway. And I don't 
think we are.

Information Age Entrepreneurship

    Ms. Bay. On a more personal note, you are clearly a believer in this 
new economy. If you were starting your career today, would you be 
tempted to start a career on the frontlines of this revolution or----
    The President. Oh, absolutely.
    Ms. Bay. You would?
    The President. Absolutely. It's so exciting. I mean, you talk to all 
these young people who are out there and have come up with these ideas, 
and they have access to capital, and they do things. And then when 
they--a lot of them make a phenomenal amount of money in almost no time, 
but they also hire people. They're interested in contributing to the 
strength of society. I never bought this generation X argument; most of 
these young people really care about the overall health of America. And 
I think the idea of having an economy that really is running on ideas is 
a very exciting prospect for the future.
    Ms. Bay. Tempted, perhaps, to run a dot-com?
    The President. Yes, I would be. If I were starting again, I would 
be. You know, I'm probably too old to do it now. I'll have to find 
something else to do in a year, so maybe I'll think about it then. 
[Laughter] But I'm not sure I'm not too creaky around the edges to do 
it.

2000 Election

    Ms. Bay. Word is they could use some experience in the dot-com 
world. [Laughter]

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    Final question. In the middle of this campaign season, Senator 
McCain is running as an outsider, in part, against you and your legacy. 
Yet, his economic platform looks surprisingly like Clinton/Gore economic 
policy. Does that make him a more formidable opponent for Al Gore?
    The President. Well, first of all, I think that every person in the 
last 30 years, including me, when I ran--you always run as an outsider, 
because more people live outside Washington than inside Washington, and 
people always think of it as a distant place.
    But I think it's both flattering and I think encouraging that 
Republicans generally have turned away from tax cuts that are so big 
that they could trouble our economy. And no matter who wins their 
nomination, there are lots of other differences between our two parties 
and our candidates that the American people will have a chance to think 
about.
    I think it would be a very good thing if we could establish a 
bipartisan consensus that we're going to keep paying this debt down; 
we're going to save Social Security for the baby boom generation; we're 
not going to allow Medicare to go broke. That would be a good thing, and 
it would be worthy of--you know, in a global economy, having a common 
economic policy is part of our national security.
    Now, that would be attractive. Then the burden would fall on both 
the Democrats and Republicans to clarify what the other issues are and 
what the differences are. So I think, really, it's quite impossible to 
predict, this early, how this thing will change. It's one of the things 
I've learned watching Presidential politics over more than half my life 
now--that they'll change. Once you think you've got it figured out, the 
American people are still in the saddle, and they'll change it on you.

Hillary Clinton's Senate Campaign

    Ms. Bay. Speaking of politics, congratulations. Mrs. Clinton made it 
formal over the weekend, announcing her campaign for the U.S. Senate.
    The President. She did.
    Ms. Bay. Are you really prepared to hit the campaign trail again, 
and this time as a supportive spouse?
    The President. Well, I will do whatever I can to help her. And New 
York has been very good to me and wonderful to us, to our family, to our 
administration, to the Vice President. But I think now what they want to 
do is hear from her. Yesterday was her day. I thought she was terrific. 
I was so proud of her. I loved her speech and what she said and what 
she's running on. If I can help her, of course, I will.
    But my instinct is that the people of New York want to hear from her 
directly, and that if I can help her, it will be later in the campaign 
when we get down to the--longer toward the end and there's fundamental 
decisions to be made by a relatively small number of voters who might be 
willing to listen to my arguments--not because it's me but just because 
I have a microphone.
    But people are pretty independent in this country, and they like to 
make their own decisions. And they're not going to vote for her just 
because she's my wife, but they might vote for her because we share some 
values and some approaches to the issues. And they want to make their 
own judgment about her. I thought she was terrific when she announced. I 
was so proud of her. And I'll be happy to be a member of the Senate 
spouses club. I hope I get to be. [Laughter]
    Ms. Bay. President Clinton, thank you very much for joining us 
tonight.
    The President. Thank you.

Note: The interview began at 5:20 p.m. in the Roosevelt Room at the 
White House. The transcript was embargoed for release until 7:30 p.m. A 
tape was not available for verification of the content of this 
interview.