[Weekly Compilation of Presidential Documents Volume 29, Number 25 (Monday, June 28, 1993)]
[Pages 1130-1133]
[Online from the Government Publishing Office, www.gpo.gov]

<R04>
Interview With Michael Jackson of KABC Radio, Los Angeles, California

 June 21, 1993

    Mr. Jackson. Good morning, President Clinton.
    The President. Good morning, Michael. It's nice to hear your voice 
again. And I enjoyed listening to your callers call in.

Economic Program

    Mr. Jackson. Oh, I'm so glad you heard them, sir. I know the budget 
is the burning issue of the moment. You may have seen a Conrad cartoon; 
it showed you in caricature, and the caption was ``Or maybe you'd like 
Bush back and another $2 trillion debt.'' How could we avoid that and 
make the whole economic climate healthier?
    The President. Well, the first thing we have to do is to gain 
control over our economic destiny again. The deficit is spinning out of 
control. It was about $74 billion a year in 1980; it's over $300 billion 
this year. The debt, as you know, has gone from $1 trillion to $4 
trillion. And because of that, the money we ought to be investing hasn't 
been there. You can see that very clearly in Los Angeles and southern 
California when you had all these defense cutbacks. We should have been 
reinvesting all that money in domestic technologies to put the people 
back to work here at home in high-speed rail, environmental cleanup, all 
kinds of other things. But the debt was so big that the money went to 
pay interest on the debt and into exploding health care costs.
    So our economic plan is terribly important to the people of the 
United States and the people of southern California because it begins to 
give us some control back. Already, the fact that the plan is making 
progress has brought down long-term interest rates. I know one lady who 
called you said her husband was in construction. Because we are at 20-
year mortgage rates lows, there have been 130,000 new jobs come into 
this economy in construction in the last 4 months. That's the biggest 
increase in 9 years. Now, it's going to take a while to reach southern 
California, because that's one of the most distressed areas of our 
national economy. But it is beginning to turn around.
    So you've got to bring the deficit down. You've got to do it in a 
way that is fair to the middle class, by making upper income people pay 
the lion's share of the burden. There have to be some incentives in this 
plan to grow new jobs in the private sector through empowerment zones in 
our cities and poor rural areas, through new incentives to small 
business. And there also have to be some targeted investments. Over the 
next 5 years, we still need to spend some money to try to redevelop the 
businesses, the communities, and retrain the workers that have been hurt 
so badly by defense cutbacks.
    So this is a good plan, and it's still the only real plan on the 
table. A lot of people have criticized it, but it's hard to quarrel with 
the results of it. Just the progress of the plan is bringing down long-
term interest rates. We've got three-quarters of a million new jobs in 
the economy since January 20th, and I am encouraged. We've got a long, 
long way to go, and we're dealing with some economic trends that have 
been in place for 20 years in the world economy. But we can turn it 
around if we will do so with discipline and if we'll stop the delay, if 
we'll go forward now and pass the plan.
    Mr. Jackson. Mr. President, you mentioned critics. Congressman Henry 
Hyde, speaking for the Republicans, claimed over the weekend that the 
Senate Democrats are going to agree to a tax-and-spend, tax-and-spend 
program this summer that will result in another version of the biggest 
tax hike in history. In a nutshell, by year's end, will the rich be 
taxed considerably more, heavily taxed? Will the middle class be further 
hit?
    The President. By year's end, if the plan passes, upper income taxes 
will go up, taxes on the upper 6 percent of the American peo- 

[[Page 1131]]

ple; two-thirds of the tax burden would be paid for by people with 
incomes above $200,000. The tax on the middle class, in the form of an 
energy tax, would be phased in over a 3-year period and would amount to 
no more than $17 a month for a family of four with an income of $50,000 
to $60,000, by the third year of the plan.
    By contrast, families with incomes of under $30,000 would be held 
harmless, and there would be an incentive in this tax program, for the 
first time, for people who work 40 hours a week but have children in the 
home and are still in poverty. The tax system would actually lift them 
out of poverty.
    So it's a very fair tax plan. But the most important thing from my 
point of view is that there can't be taxes without an equal amount of 
spending cuts. And there are substantial spending cuts in this program 
in everything from Medicare to veterans benefits, to agriculture, to all 
the specific programs, just about, in the Federal Government. People who 
say there aren't spending cuts just haven't said it right.
    And for Mr. Hyde, whom I like a lot, to just get on there and chant 
their old ``tax-and-spend'' line, I mean, you know, that's the same 
crowd that presided over the last 12 years where we went from a $1 
trillion to a $4 trillion debt, increased the national deficit every 
year, and reduced our investment in the future. I mean, they actually 
set in motion the policies which you see manifest all around you today 
in southern California. And I don't see how they have any credibility on 
this.
    Last week in the Senate Finance Committee, there were all kinds of 
amendments by the Senate Republicans. They were all designed to increase 
the deficit by moderating tax increases with no offsetting cuts. So 
there just isn't another plan out there. We're either going to have to 
make up our mind whether to do the tough stuff necessary in terms of 
budget cuts and fair revenue increases to bring this deficit down and 
get control of our economic future and keep these interest rates down, 
or we're not.
    And let me just make one other point. For anybody who has refinanced 
a home loan or refinanced a business loan or gotten a car loan, a 
consumer loan, a college loan at lower interest rates, a lot of people 
are going to in the middle class and even some upper income people are 
going to save more money on lower interest rates than they're going to 
pay in higher taxes.
    That's the key thing. We've got to get the interest rates down. 
We've got to start investment in this economy again. And if we don't, 
we're going to be in real trouble. You had someone call from Orange 
County; I see what's happened to real estate in Orange County. Our 
proposal contains significant incentives to get the real estate business 
in California up and going again and throughout the country.
    There are all kinds of things in this plan which are very, very good 
for business, that the business community has been asking for for years. 
But we do ask people who are earning income, who have it and whose taxes 
went down in the eighties while the deficit went through the roof, to 
pay a fairer share of the tax burden so we can bring the deficit down.

NAFTA

    Mr. Jackson. Relating to the calls we received earlier, Mr. 
President, a blunt question: Does Ross Perot concern you? And I pose it 
that way because of his stand on NAFTA, the North American Free Trade 
Agreement. He really is claiming that this country and particularly this 
State of California is going to lose hundreds of thousands of jobs that 
would go to Mexico if the agreement should be ratified.
    The President. Well, I disagree with him on that issue. There are 
other issues on which I think we are agreed. We've got a version of the 
line-item veto in the United States Senate. I very much hope it will 
pass; I strongly support that. I'm pushing for campaign finance reform 
to reduce the influence of special interests in campaigns, something 
that he and I both talked about in the last campaign. We've got that out 
of the Senate; we need to pass it in the House. We're pushing for 
lobbying reform, something we both talked about last time. We passed a 
dramatic increase in the requirements for reporting of lobbyists in the 
Senate. I hope we can pass it in the House.

[[Page 1132]]

    But on NAFTA we just disagree. I believe that a country like ours, 
if we want to generate more jobs, we're going to have to increase the 
volume of trade. I understand what the concern is with Mexico, but I 
would say to everyone in California today two things: Number one, 
something you know perhaps better than other Americans, anyone who wants 
to shut a plant down and go to Mexico today for low wages can do it. And 
they'll be able to do it just as well today or tomorrow as they could 
after NAFTA is ratified. Number two, as you have seen in California, as 
long as incomes are very depressed in Mexico, you're going to have a 
bigger and bigger problem with immigration that goes beyond the legal 
limits of the law. And what I see happening with NAFTA is a Mexico that 
can buy more American products, where more Mexicans will want to stay 
home and be near their families because they'll be able to make a 
living. And Mexico will be the leader of a whole new wave of trading 
partners for the United States, going down past Mexico into Central 
America, into Chile, into Venezuela, into Argentina, into other 
countries. I believe it will create jobs for America. I wouldn't do it 
if I didn't think so.
    And let me also tell you that there's beginning to be a little bit 
of a chill in the wind of people who think that they ought to just 
automatically move their plants to Mexico to save money. There's a big 
story just in the last day or so about General Motors moving 1,000 jobs 
back from Mexico to the United States to Michigan, a high-cost State 
with very productive labor, to produce some of their small cars. So I'm 
very hopeful about this.
    And let me make one last point. About 4 years ago we had a $5 
billion trade deficit with Mexico. Today, because of the trade barriers 
that Mexico has lowered, we have a $6 billion trade surplus, which means 
we've created more jobs because of trade with Mexico than we've lost 
because of jobs moving down there. So my view is that we can make it a 
winner.
    Now, we don't want to just have a trade agreement with no standards. 
The Mexican people are going to have to be willing to work with us on 
environmental standards and on labor standards so we don't just open the 
floodgates to move jobs to Mexico in ways that won't even raise incomes 
in Mexico. That would be a terrible thing to do. But if we do it right, 
it will create jobs for both countries.

International Economy

    Mr. Jackson. Mr. President, things are pretty awful all over. I 
mean, Europe is in the worst recession since the 1930's; Japan has been 
hit, too. By contrast, aren't things beginning to get better here?
    The President. Well, they are beginning to get better here and 
they're beginning to get better here basically for two reasons. First 
off, American industry was really battered here during the entire 1980's 
and in fact starting back in the mid-seventies. And there has been a 
determined effort by people running our firms in the private sector to 
become more competitive, so a lot of them are. And that increased 
productivity, increasing output per worker, the increasing ability to 
compete with countries around the world, that is helping things to get 
better. The second thing that's making things better is that this 
administration's serious effort to bring the deficit down has helped 
long-term interest rates to get down to their lowest rate in 20 years, 
and that's leading people to refinance, freeing up some money, and we're 
getting some more investment.
    But I don't want to mislead anybody. This is still going to be a 
very tough road back. If you look at southern California, if you look at 
Connecticut, if you look at some of the States that have been hit 
especially hard by defense cutbacks of all kinds and other economic 
problems, we're still going to have to have a very disciplined plan to 
invest and grow our way out of the problems of the last few years.
    But yes, we're in better shape now than Europe and Japan. In fact, 
if we could get some more growth in those countries, we'd be in better 
shape because we're not selling as much to them as we would be because 
of their economic problems. They don't have the money to buy American 
products. And when I go to Japan in a couple of weeks to talk to the 
leaders of Europe and Japan, one of the things we're going to be talking 
about is that America is doing what they asked us

[[Page 1133]]

to do, we're bringing our deficit down. And we want the Europeans to 
bring their interest rates down and the Japanese to invest some more 
money in their economy so they can grow it, because they don't have the 
deficit we do. And if we can work together, we can grow the world 
economy and that means jobs for America.
    But you're quite right, we're actually in better shape than Japan 
and Europe is right now, except for unemployment rates, Japan's still 
got a lower unemployment rate than we do.
    Mr. Jackson. Mr. President, thank you very, very much indeed for 
this, sir.
    The President. Thank you, and again, I want to thank your callers 
for the thoughts they expressed. And I want to encourage them to 
continue to be active and to question and criticize me when they think 
I'm wrong but also to support me. I really appreciate the woman who said 
she didn't vote for me but she's got a stake in the success of this 
Presidency. We're doing what we can to move this country forward without 
regard to party or region. And that's the kind of support I need. I'm 
very grateful for that.
    Mr. Jackson. Thank you, Mr. President, very much, sir.

Note: The interview began at 12:16 p.m. The President spoke from the 
Roosevelt Room at the White House.