[Weekly Compilation of Presidential Documents Volume 29, Number 25 (Monday, June 28, 1993)]
[Pages 1136-1137]
[Online from the Government Publishing Office, www.gpo.gov]

<R04>
Interview With Phil Adler of KRLD Radio, Dallas, Texas

 June 21, 1993

    Mr. Adler. Mr. President, are you there?
    The President. I am, Phil.

Btu Tax

    Mr. Adler. Good morning to you. We think that a lot of people 
responded to a theme, or at least I think so, in the Presidential 
campaign of sacrifice to cut the deficit as long as that sacrifice is 
equal. The Btu tax was designed originally on the concept of equal 
sacrifice. But then all of these exceptions were added, and it really 
makes it appear that it's one of the most complicated proposals ever. 
Did you make a mistake allowing all the special exceptions to be 
included in the Btu tax?
    The President. Well, I didn't allow them all to be included. Some of 
them were included in the House of Representatives bill, and I didn't 
agree with all of them. But let me say what I think was a good criticism 
of the tax and that is that we wanted the tax to restrain energy 
consumption in ways that promoted energy conservation and also supported 
fuel switching to more environmentally beneficial and more available 
natural gas. That bill, as drawn, would be a big boon to the natural gas 
industry in Texas and Oklahoma and throughout the United States. And 
that's one of the things we were trying to do. Now, some of the oil 
companies didn't like it, but the people that were in the gas business 
liked it. We had a big Texas gas company, headed by a person who 
strongly supported President Bush in the last election, endorsed the 
economic program. ARCO and Sun Oil both endorsed the economic program, 
including the Btu tax.
    So Secretary Bentsen, who, as you know, has represented you in the 
Senate for a long time, offered the Senate a modified Btu tax which, 
instead of having all those particular exemptions, would basically have 
alleviated the burden of the Btu tax on industry and agriculture on the 
production sector but still given them an incentive to move toward 
natural gas wherever possible and would also have cut the Btu rate and 
would have replaced that with more spending cuts.
    From my point of view, unfortunately, we couldn't pass that through 
the committee because Senator Boren had said he wouldn't vote for any 
tax based on the heat content of fuel. But I still think it was a good 
concept, and it will be interesting to see what happens if the Senate's 
version of the economic plan passes, to see what happens in the 
conference and what we come up with.
    Mr. Adler. What we have now is a gasoline tax that's been passed by 
the Senate committee, and you've called that regressive in the past. How 
can you sell that, if you have to, to House Members who did risk some 
political capital by supporting you on the Btu tax?
    The President. I think anything that comes out has to be a 
combination of agreement between the House and the Senate. It's hard to 
get 218 House Members and 51 Senators to agree on anything that's tough. 
I mean, everybody can talk about cutting the deficit, but it's one thing 
to talk about it and quite another to do. But I think they'll be able to 
do it. No one was particularly happy with the form of the Btu tax, or 
very few people were, that passed the House, but everybody thought that 
Secretary Bentsen could come up with a plan that would make it good for 
the economy and could achieve what we were trying to do in terms of 
promoting domestic energy, and I think he did. The Senate preferred a 
tax that was a gas tax and a tax on some other fuels. It, at least, is 
small enough so that it is not particularly unfair to people in rural 
areas. It's not as big as what some had wanted, and certainly I did not 
want just a big old gas tax. I thought that was unfair.
    I also think it's important to point out in Texas, in light of the 
rhetoric in the recent political campaign, that it is simply not true 
that there is no spending cuts in this plan. There's $250 billion in 
spending cuts, and they affect everything. They affect agriculture and 
veterans and Medicare and the whole range of discretionary spending of 
the Government. They affect foreign aid; they af- 

[[Page 1137]]

fect defense. There are sweeping, broad-based spending cuts in this 
program. And the tax increases, two-thirds of them, fall on people with 
incomes above $200,000, three-quarters on people with incomes above 
$100,000. Families of four with incomes below $30,000 are held harmless, 
and people who work for a living 40 hours a week and have kids in the 
house who are now in poverty would actually be lifted above poverty by 
these tax changes in ways that promote the movement from welfare to 
work. So this is a fair and balanced plan.
    It was developed, and in a very aggressive way, by Lloyd Bentsen and 
by Leon Panetta, who used to be chairman of the House Budget Committee, 
to be fair, to have equal spending cuts in taxes, and to drive the 
deficit down so we could bring interest rates down. That's good for 
Texas, and that's good for everybody in America. And also, it leaves 
some room for investments that are critical to our future. And as you 
know, I support--you were implying this before I got on--I support the 
space station and the super collider projects because I think they're 
good for America's future. And if you're going to spend money on those 
things, you have to spend money on them. You can't play games; they do 
cost some money.

Space Station and Super Collider

    Mr. Adler. Mr. President, how long can you guarantee that support 
for the super collider and the space station? Will they fall if that's 
the only way to meet your overall deficit reduction goal?
    The President. Well, my overall deficit reduction goals can be met 
in my plan with the space station and the super collider. I do want to 
emphasize that we've already shaved $4 billion off the 5-year budget for 
the space station and some money off the 5-year budget for the super 
collider by redesigning the space station, based on a team of 
exceptional national experts who analyzed the project and recommended 
that it be redesigned and also that NASA's management be changed rather 
dramatically. And we just delayed the implementation schedule on the 
super collider some, so that none of the opponents of the space station 
and the super collider could claim that there had been no spending cut 
there.
    So we have done that. But I strongly feel it would be a mistake to 
abandon those. Now, I would be less than candid if I didn't tell you 
that there are a lot of people in other parts of the country who want to 
cut those projects. There was always a lot of opposition to them, and 
because of the last election and all of the rhetoric and all the claims 
in Texas that there were no spending cuts in this budget, that has given 
real energy to the opponents of the space station and the super 
collider. It wasn't true that there were no spending cuts, but there are 
a lot of people up there who have been wanting to kill these projects 
for years who are just gleeful at the way the rhetoric in the last 
election played out in Texas. They think that they have been given a 
license by the people of Texas to kill the space station and the super 
collider. And it's going to be very much harder for me to keep them 
alive. But I'm doing the best I can.
    Mr. Adler. Mr. President, I'm informed that our time has run out, by 
one of your aides, I believe. Good to talk with you this morning.
    The President. Thank you. I enjoyed it.

Note: The interview began at 12:42 p.m. The President spoke from the 
Roosevelt Room at the White House.