[Weekly Compilation of Presidential Documents Volume 29, Number 10 (Monday, March 15, 1993)]
[Pages 371-378]
[Online from the Government Publishing Office, www.gpo.gov]

<R04>
Remarks to the Legislative Conference of the National League of Cities

 March 8, 1993

    The President. Thank you very much, Mayor Fraser, ladies and 
gentlemen. It's a great honor for me to be here. This is a pretty rowdy 
bunch. [Laughter] A vital group, a group more interested in change than 
in more of the status quo, I think. I look around this audience today, 
and already, just walking in and looking in the crowd and saying hello 
to people here at the head table, I see people without whom I would not 
be standing here today. I thank those of both parties and those who run 
as independents for your support of this plan. And I say again what I 
always feel when I'm with a group of people from America's cities and 
small communities or from the States, and that is I feel very much at 
home.
    A lot of times my friends ask me what's the difference from being 
President and having any other kind of job or the life you used to have. 
The following thing occurred to me the other day in the White House. I 
was down on the ground floor; I had been out running or something, and I 
was going back up to get ready to start the day's work. And a group of 
people were coming out who had been at a meeting there, at another 
meeting with other people. And I ran into them and stopped and shook 
hands with them. It was totally an impromptu thing. And this man who 
worked at the White House said, ``Mr. President, I'm really sorry that 
you had to confront those people.'' And I said, ``That's all right. I 
used to be one once.'' [Laughter] I look forward to being one again 
someday. [Laughter]
    The work of this White House has been very much influenced by many 
of you in this group. And I assure you that you will be represented in 
the future. We have a strong intergovernmental affairs group that works 
every day with leaders at the city and county and State level, including 
Regina Montoya

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and Loretta Avent, who used to work for you. [Applause] Now, we had a 
bet coming over here. I said, ``Loretta, if I mention your name, will 
they boo or clap?'' She won. [Laughter]
    I came here today to ask you to translate the support you have given 
to the program I have presented to the Congress and to the American 
people from support to a commitment to secure its approval in the 
Congress and to make the change that we seek inevitable and return to 
the status quo impossible.
    All of you are on the frontlines of change. Every day in every way 
you have to struggle with the things which now confront me as your 
President. For a long time you've been making tough choices, struggling 
to balance your books, trying to spend less on yesterday's mistakes and 
more on tomorrow's needs. You try to put common sense into practice. And 
now I would like you to ask to help make common sense more common here 
in your Nation's Capital.
    I think everyone now recognizes that we cannot continue on the past 
course. If we keep on doing just what we've been doing with no 
fundamental changes, then by the end of the decade the Government's 
annual deficit will be $650 billion a year. We will be spending 20 
percent of our Nation's income every year on health care, and our 
nearest competitor will be spending about 10 percent, and we'll be 
insuring fewer people than any country with which we compete. And over 
20 cents of every dollar the American people pay in taxes to the United 
States Government will be expended just paying interest on the vastly 
accumulated debt.
    We've been spending too much and investing too little for quite a 
long while now. And the result has been slow growth and weak job 
creation. We've had our private sector handcuffed by high interest rates 
and inadequate investment, a work force inadequate to the needs of the 
21st century and an economic program equally inadequate. If we keep on 
doing business as usual, we'll just stumble into the next century 
burdened by the baggage of the past. But if we have the courage to 
change, the next 20 years could be the best in our Nation's history.
    When I introduced my plan to the Congress just 19 days ago, I asked 
all of us to ask of this plan not what's in it for me but what's in it 
for us. And people have responded in astonishing ways but I suppose 
predictable ways if you look at the history of the American people. All 
across this country people have been taking off their special interest 
hats and putting on their thinking caps. Business and labor, Republicans 
and Democrats, people from every walk of life and all points on the 
political spectrum have rallied behind this plan as a vehicle to move 
this country forward. I think everybody who seriously thinks about it 
understands that the great issue now is no longer Republican versus 
Democrat, urban versus rural, liberal versus conservative. It is whether 
we will stay in this gridlock that you have buttons campaigning against, 
or have the courage to change in ways that allow all our people to live 
up to the fullest of their potential. Even if I start preaching, I 
promise not to pass the plate. [Laughter]
    You would be amazed how many times in the last year I would be in a 
little town or along some country crossroads and people would say to me 
they were worried about what happened in Los Angeles. You would be 
amazed how many times I was in a community that was 99 percent one 
ethnic group and somebody would say they wished that we could work out a 
way for the ethnic diversity of America to be a source of our strength. 
You would be amazed how many times I was in groups of people, all of 
whom had incomes above $150,000 a year, when they said to me, isn't 
there something we can do about homelessness in America. I think the 
people of this country are dying to come together again and make this 
country work again.
    Nonetheless, let us be clear on this: There are people who are 
honestly debating whether this three-pronged plan is the right thing to 
do for the country. There are some who say, ``Well, of course, I want 
you to cut spending. And as a matter of fact, if you'll cut her spending 
more, you could cut mine a little less.'' [Laughter] And there are 
others who say, ``Well, I know you have to raise taxes, but I wish you 
wouldn't raise this one or that one so much. Raise the upper income 
taxes less,'' or ``Do away with the energy tax,'' or ``Put it all on 
gasoline,'' which is harder

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on the rural States and the western States, ``but let natural gas and 
oil off the hook.''
    And then there are those--and I want to talk to you about them today 
because you are not among them, but I need your help to deal with it--
who say, ``Well, if you cut the spending and raise the taxes and didn't 
invest any new money in anything, you'd have more deficit reduction,'' 
or ``If you cut the spending and didn't invest any new money in 
anything, you wouldn't have to raise quite so many taxes,'' and ``After 
all, if the Government spends a dollar, it's Government spending.''
    One of the central debates now raging in this Capital is whether 
there is any difference in the kinds of Government spending. Is there a 
distinction to be made between, for example, spending more for the same 
health care every year and accelerating the funding of the Surface 
Transportation Act? Is there a distinction to be made between a subsidy 
that was justified 50 years ago because we needed more wool in our 
uniforms and a subsidy that might be justified tomorrow to give to 
people who start new businesses and new high-tech enterprises to grow 
jobs for the future?
    The people who say we do not need this economic stimulus plan and we 
do not need so much investment either argue one of two points. They 
either say, ``All Government spending is bad, and there is no 
distinction to be made,'' something until recent times every Republican 
and Democratic officeholder in America, from the top to the bottom, 
would have disagreed with. Dwight Eisenhower knew there was a difference 
between the interstate highway system and paying to maintain the status 
quo of Government programs that didn't work. Everybody always recognized 
that distinction before, but there are a lot of people who have had a 
lot of sway in this town for years now who really argued that there are 
no distinctions to be made. There are others who say, ``Well, the 
economy is recovering anyway and everything is going to be hunky-dory. 
So all you have to do is worry about reducing the deficit.'' Now, their 
view of what we ought to do might be characterized as ``Status quo-
lite.'' [Laughter] That is, ``Yeah, I know you've got to change on the 
cutting side, and maybe we have to have a little tax increase, but there 
is no distinction between kinds of Government spending. And besides, the 
economy is in great shape. We just don't know it yet.'' [Laughter]
    Now, let's be candid. We do have some good economic news in the 
aggregate. And last month, for the first time really in a very, very 
long time, we had a significant number of new jobs. But if you look 
behind those numbers, you see that while employment is edging up, an 
awful lot of those jobs were part-time jobs with part-time wages which 
rarely provide the health care benefits that families so desperately 
need today.
    To build a stronger recovery with real jobs and rising incomes, 
we'll have to break the gridlock that has paralyzed public action, cut 
the deficit, and invest more in the future. If you look at our economic 
performance over the last dozen years and you say, describe the ways in 
which America has not been competitive with other nations that are 
growing faster, and you had to list them, you just think of what you 
would list. You would say, well, the deficit grew more rapidly than it 
did in Japan, for example. And America spent a higher percentage of its 
income on health care than any other country in the world by far, even 
though we did less with it in terms of covering people.
    You'd also have to say, however, our investment in the things that 
make a country rich and strong actually went down in several areas, in 
our infrastructure, in K through 12 education. Nine nations in the world 
invest a higher percentage of their income in K through 12 education 
than we do, even though we have more diversity by race and income, which 
would argue for greater efforts in our Nation.
    If you look at the United States budget just over the last 4 years, 
you will see we spent more on Medicaid and Medicare and food stamps, 
with over 1 in 10 Americans on food stamps, and more on interest in the 
debt, and relatively less on everything else, the investments which 
would make us richer as a country, which will grow the economy, which 
will put people back to work, which will reduce our reliance on public 
assistance and increase our ability to support each other.

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    So I would argue to you, my fellow Americans, that we have to argue 
in this community where the ultimate decision will be made: number one, 
that we need to pass the whole program; number two, there are jobs still 
begging to be created out there; number three, there are differences in 
the quality and character of government spending, whether it is in the 
smallest community of this country or the United States budget. There 
are differences.
    The stimulus plan I have asked the Congress to adopt, along with the 
spending cuts, the investment increase, and the tax increase itself, 
will create a half a million new jobs in the short run. The economic 
program, if it is fully enacted, will create 8 million jobs over the 
long run--that is, in this 4 year period--the vast majority of them in 
the private sector.
    This plan is based on values that are central to what makes America 
work and what has always made America work: work and family and faith, 
responsibility and community and opportunity. I think the change 
obviously has to start at the top. I have presented a budget which in 
the next fiscal year will cut the White House staff by 25 percent and 
save $10 million in privileges and perks and payroll. I have reduced the 
administrative costs of the executive branch by 14 percent over 4 years 
and, by attrition, payroll, 100,000 over 4 years, saving $9 billion.
    I have asked the Congress to freeze the pay of Federal employees 
next year and then to lower it by one percent less than would otherwise 
be the cost of living for the succeeding 3 years, saving billions more 
dollars and asking a substantial, a very substantial sacrifice from the 
Federal work force because I thought that was important before I could 
ask the taxpayers to contribute more.
    And last Wednesday, I asked the Vice President to head a national 
performance review of every Government agency and every Government 
program, not simply to identify more specific spending cuts but also to 
identify services that don't work and things that can be done better, to 
do what the smartest private companies and the best local governments 
are already doing: streamlining operations, eliminating unnecessary 
layers of management, empowering frontline workers in holding our 
investments up to the clear light of day to see whether they make sense.
    I have proposed already 150 specific spending cuts, saving $247 
billion. And that's much more than the cost of the net new investments I 
have proposed. I ask you to join me now in fighting for these 
investments and in cutting back the spending, but not in doing one 
without the other.
    For example, our plan calls for ending the designated project 
program at the Department of Housing and Urban Development. It spends 
over $100 million a year without any published selection criteria or 
competitive procedures or basic accountability. But if you join me in 
cutting that program, I also ask that you support what I know you 
believe in and what we have to say to the Congress is worth doing: 
doubling the number of housing vouchers for working people on moderate 
incomes, creating a network of community development banks, bringing new 
opportunities to our communities through enterprise zones, and doing 
something to reinvigorate the housing programs of this country. These 
things can be done together.
    I ask you to help me reduce low-priority highway demonstration 
projects by $1 billion; but also for calling in the new investments we 
need, we ought to fully fund the Surface Transportation Act, and do it 
quickly. And we should recognize that transportation offers enormous 
economic opportunities to increased productivity and jobs. So we have to 
look at mass transit, high-speed rails, smart cars, smart highways, and 
commercial aviation as we move toward the 21st century. If we want this 
economy to grow, we have to do those things.
    This plan calls for cutting $300 million in earmarked small business 
loans but also calls for the most dramatic effort in the history of 
America that I can determine, at least, from our research, to help small 
business create jobs: a permanent investment tax credit for small 
businesses, 90 percent of the employers in this country with 40 percent 
of the employees creating the vast majority of the new jobs; a new 
venture capital gains tax for people who will start new businesses and 
have the courage to begin being on the cutting edge of change; and real 
steps which we will announce in a couple of days to try

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to end the credit crunch and the lack of availability of credit to small 
businesses who have to provide the jobs of today and tomorrow.
    In short, we have to cut, and we have to invest. We have to reject 
trickle-down economics, and we have to reject tax-and-spend economics. 
We have to stop spending money on things that don't work, but we have to 
continue to invest in things that do.
    A lot of the things that we propose to do are literally direct 
investment incentives to the private sector. I mentioned a couple 
already: the $3 billion permanent small business investment tax credit; 
some significant changes in the way taxes are computed for our larger 
businesses so that when they do invest in new plant and new equipment 
and new jobs for our people, they will be rewarded, not punished, by the 
tax system. If people do what's right, they should be supported. We 
should make a distinction between how private companies spend their 
money. And when they invest to grow and to create jobs, they should be 
rewarded for that. And that's what we're trying to do in the tax system.
    In addition to those things I have already mentioned, I recommended 
a significant increase, about $2.5 billion--the first one in a very long 
time, as all of you know--in the community development block grant 
program. I can say with confidence as a Governor that that program was 
absolutely critical to helping many of the smaller and moderate-sized 
communities in my State attract new jobs in the tough decade of the 
1980's and that without it I do not know if we would have been able to 
do so. There are people in this audience from my State who know that is 
true because they have personally experienced it. And I think that is 
true all across the country.
    We simply cannot afford not to invest what it takes to make our 
communities attractive to new businesses and new jobs. And if anyone 
here in this community tells you that the economy is fine in America, 
tell them where you live there's still a little work to be done.
    I want to hammer this home as hard as I can. This is the first 
recovery, economic recovery, in my lifetime where if you look at the 
overall numbers, it really does look like a recovery is underway. 
Productivity is increasing. American businesses are doing a better job. 
A lot of things are going on, but the jobs themselves are not yet being 
created. And we are facing other problems which may further put pressure 
on some communities, including the imperative of continuing to reduce 
the defense budget. We have got to follow a jobs strategy. We have got 
to do that.
    Now, one of the things that I've tried to do, as all of you know, is 
to reduce the deficit, because if we do we'll reduce interest rates. And 
if you keep interest rates down and people go out and refinance their 
businesses, their homes, their cars, their credit cards, they'll have 
more cash. They can invest it and make this economy grow. That is also 
happening.
    Interest rates just since the election have gone down, long term, 
almost one full point. If we can keep them down and everybody, all of 
you and all of the people you represent, will go out and refinance all 
the debt they've piled up in the 1980's, that will free up another $80 
billion to $90 billion to $100 billion this next year to grow this 
economy. That's important, but we also have to get some real investment 
incentives, public and private. Unless we create jobs, we cannot claim 
to have done anything to promote an economic recovery that affects the 
lives of the people that you see on the street every day.
    Let me also say, in addition to creating an economic environment in 
which there is investment, we also have to do what we can in common to 
prepare our people for those challenges. And we have to recognize the 
fact that, in many ways, America has not done a good job of preparing 
its people. Example number one, to begin with children, all the nations 
in this hemisphere, only two, only two, Haiti and Bolivia, have lower 
immunization rates against preventable childhood diseases than the 
United States of America, where all of the vaccine is made. Only two. We 
have proposed in this program, starting with the stimulus package, an 
effort that will permit us over the next few years to immunize all the 
kids in this country against preventable childhood diseases.
    The estimates are that for every $1 we spend immunizing children 
against those diseases, we'll save $10 down the road in the care that 
will otherwise be spent on them.

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But in order to make those estimates right, you have to have a critical 
core threshold of young children who are immunized. And we are running 
the risk of falling dangerously below that threshold in many areas and 
having new epidemics of disease break out among our children simply 
because we do not provide either the infrastructure in order to do that 
or the affordability and availability of the vaccines. We must do that.
    Let me give you one other example. The Head Start program, where it 
is fully and firmly implemented along with other support services, 
plainly saves more money than it costs in the terms of keeping kids in 
school and making them successful, in helping them to graduate and do 
well. And yet for years we've all talked about fully funding the Head 
Start program and supporting other efforts like in-school preschool 
programs or parent-based preschool programs, yet we've never really done 
it. Congress and the previous administration did expand the Head Start 
program some, but there are still enormous numbers of children who are 
not able to access those services. This budget starting this summer 
fully funds the Head Start program. And we ought to pass that.
    If we begin this summer and we work for the next 3 years, just think 
what it will be like. Wouldn't it be nice to be able to say we've 
actually done something so we can go and work on a new problem? Wouldn't 
it be nice if in the next election cycle in 1996, no one could argue 
about Head Start or immunization; they had to argue about something 
else? [Laughter] I mean, somebody asked me one time what my goal as 
President was, and I said that I'd like to leave my successor a new set 
of problems. [Laughter] You think about it.
    This plan will create about 700,000 summer jobs for people in this 
country. And we are attempting to mobilize private sector employers to 
match what we're doing with the goal of creating over a million jobs. 
Think about it. Think about how many young people in this country have 
been surrounded by devastating economic conditions year in and year out 
for the last several years. They flip on the television, and they see 
another ad telling them what they ought to say no to. Well, I'm all for 
telling them what they ought to say no to. But I think we should set an 
example and give them something to say yes to as well.
    This plan will give our country the most ambitious system of 
lifelong learning we have ever had: programs for high school dropouts 
and others to learn to read adequately and get their high school 
equivalency; programs for young people to be able to borrow the money 
they need to go to college and pay it back on far more favorable terms 
or with service to our country here at home as police officers or 
teachers or in other forms of community service; programs for adults who 
lose their jobs because of defense cutbacks or because of sweeping 
changes in the global economy to get serious, serious opportunities to 
retrain in areas where there are jobs available, tied to incentives to 
getting investments for those new jobs in their communities. Not just 
talking about it; this plan gets serious about it. We have almost $5 
billion for the retraining of adults in the work force alone in the next 
4 years in this program, and it needs to pass.
    And anybody who says that this recovery will just do fine without a 
serious attempt to retrain the work force has not been to California 
lately to see what's happened in the industries where the defense cuts 
occurred; have not been in the rural parts of America to see what has 
happened when a lot of those low-wage, low-skilled, high labor-intensive 
manufacturing plants closed down and moved overseas with no plans to 
retrain or reinvest in those communities; or all the places in-between.
    There is too much work to be done. We need a partnership, and it has 
to begin with making sure the people of this country can compete and win 
in the global economy. And that requires some investment. And there is a 
difference between whether you spend money making people stronger and 
smarter and safer and more secure and more able to compete, and whether 
you just keep spending more money on the same thing. There is a 
difference. And this program is different.
    This plan will enable us over the next couple of years to work with 
you to put 100,000 more police officers on the streets of the cities of 
this country. There are cities which

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have actually seen a reduction in the crime rate, either in specific 
neighborhoods or in the cities as a whole, in the last few years, cities 
here represented in this room, when they've gone to community policing 
strategies. You know it works. I know it works. And we know most cities 
don't have enough money to do it right. We're going to help you through 
giving people incentives who are coming out of the service to be police 
officers, through giving people incentives to be police officers as a 
way of paying for their college education, and through, I hope and pray, 
passing the crime bill, which didn't quite make it through last year, to 
put these police officers on the street.
    One of the most remarkable aspects of this program is one that 
hasn't received a great deal of attention and doesn't involve you 
directly, but it will shape the communities you lead and govern 
indirectly. And that is the astonishing increase in this program in the 
refundable earned income tax credit for working people, not only to 
offset the impacts of the energy tax on families with incomes under 
$30,000 but also so that we can finally say in this country, if this 
earned income tax credit passes as it will be presented, that if you 
work 40 hours a week and you have children in the home, you should not 
be in poverty. And the tax system will lift you out and reward work. It 
will reward work. Imagine it! Just imagine, politicians for years have 
been saying they wanted to reward work, not welfare. Now, by adopting a 
simple bill that says the tax system will reward work, not welfare, we 
can give people something new to argue about. It would be a great thing 
to do.
    I ask for your help again. The big issue is, should we do all these 
things: Should we cut spending; should we raise revenues; should we 
increase investment so that the deficit goes down while investment goes 
up. This country has never tried to do this before. You've got to be 
fair to the Members of the United States Congress. We are asking them to 
do something our country has never tried to do before, which is to 
hammer the deficit down and increase investment significantly at the 
same time. But you know where you live, you can see it every day that we 
have to do both. We have to do both.
    And so I say again in closing, I thank you for your endorsement of 
this program. It made me feel great. I want every Member of the United 
States House and Senate to know that you not only endorsed it but that 
you believe in it, not just because of what you get out of it but----
    Audience member. What about drugs?
    The President. You want to talk? I'll be glad--this program has a 
lot in it, actually, about drugs. It has a significant increase in funds 
for drug treatments and gives you, through providing 100,000 more police 
officers, the power to combat drugs on the street. It does both things. 
It increases enforcement and treatment, which I would think you would 
want.
    But that makes a good point: Is that spending, or is that an 
investment? You have to decide. But you have got to give the Congress 
courage to do this. And you have to help people understand that in this 
group there were Republicans and Democrats and city people and country 
people, people from the frost belt and the sun belt and the rust belt 
and the Bible belt, people like me that have to get bigger belts every 
year. [Laughter] You can do that. And if we can do that, we've got a 
real shot to sit here in honest discussion year in and year out and face 
these problems.
    You know, how many years have you been coming up here and listening 
to this debate, and it doesn't bear any relationship to the life you 
live when you go back home? How many, really? I mean, whether it's a 
discussion about drugs where somebody just talks about getting tough on 
crime and nobody ever gets down to what they're going to do to help you 
deal with the problem where you live; or jobs, and somebody rails 
against taxes and the deficit, and then every year the deficit goes up 
and so do taxes. Or just how many years have you been coming here 
listening to these debates when nothing ever changed?
    And I just want to tell you, as I said to the Congress, there is 
plenty of blame to go around; this is not about party. And I don't care 
who is to blame. I'm prepared to take responsibility. I'm more than 
willing to face the heat, and if something goes wrong, I'll take 
responsibility for that and change it. But let's do something, and let's 
do it now.
    Thank you.

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Note: The President spoke at 1:15 p.m. at the Washington Hilton. In his 
remarks, he referred to Donald M. Fraser, Mayor of Minneapolis, MN, and 
president of the National League of Cities; Regina Montoya, Assistant to 
the President for Intergovernmental Affairs; and Loretta Avent, Special 
Assistant to the President for Intergovernmental Affairs.