[Weekly Compilation of Presidential Documents Volume 29, Number 30 (Monday, August 2, 1993)]
[Pages 1482-1491]
[Online from the Government Publishing Office, www.gpo.gov]

<R04>
Interview With the Texas Media

 July 28, 1993

    The President. It's nice to see you all here. And I know you've all 
received other briefings today. And so I think that probably the best 
thing to do would be to start, and I'll answer your questions.

Texas Senatorial Election

    Q. [Inaudible]--we are aware of the fact that did carry the State in 
the election last year. And more recently Texas rejected the Democratic-
appointed Senator in what some people, such as Senator Gramm, 
characterized as repudiation of you and your policies. So to paraphrase 
Admiral Stockdale, why are we here?
    The President. [Inaudible]--several others who wanted to support it 
and felt that there had never been an adequate defense made in Texas. I 
thought, given the fact that I had two Texas opponents, I did rather 
well there in the last election. And I don't, with all respect, I don't 
think the Senate race in Texas was a referendum on our program, because 
nobody defended it; nobody said what was in it.

[[Page 1483]]

    There have been four special elections in the Congress: three in the 
House, one in the Senate. The Democrats won all three in the House. But 
frankly, only one of those races was a referendum on the program, 
because it was the only place where the Democrat on his own initiative 
defended the program--without my even knowing it, put my picture in his 
brochures, ran television ads explaining to the people what was in the 
program. And he won the race by nine points in a district in which a lot 
of upper income people live who would have to pay the higher taxes.
    So you can't have a referendum on a program if the people don't know 
what's in it. If anything, if I've made any mistake in this, it is that 
this is the only issue in my lifetime where the people knew less about 
it as time went on. That is, on February the 18th when I spoke to the 
country, I actually went through chapter and verse factually all the 
things that were in this program and how they fit with what we wanted to 
do in health care, welfare reform, the crime bill, all the things that 
are coming afterward. But I said who was going to pay the taxes, what 
the spending cuts were going to be.
    After that, because there was no fight over the spending cuts, 
people were not told there were any, and the rhetoric against the 
program took over. So I think I owe it to the people of Texas to at 
least put my case out there. And I certainly owe it to the Members from 
Texas who supported the program because they think it's the right thing.

Taxes

    Q. [Inaudible]--Corpus Christi. It's a community that's just now 
coming out of recession, and they're doing it, probably they're 
diversifying. What can you say to reassure folks who have been hearing 
about this gasoline tax, people who are in the tourism industry who 
depend on people driving to come see us and our attractions, people who 
in the refinery industry who are dependent on--and the people, the 
trucking industry, agricultural and so forth? What can you say to them 
that will put them at ease about what may be coming out of this 
conference committee?
    The President. I don't think the conference committee is going to 
adopt anything in the range of a dime, nine cents, eight cents, anything 
like that. I think, first of all, gasoline is at its lowest real price 
adjusted for inflation in more than three decades. I think that any tax 
they put on it will be modest and will amount to no more than $50 a year 
for a family of four with an income of $50,000 a year, about $1 a week 
to help to pay down the deficit. All the money will be put in a trust 
fund and can only be spent to reduce the deficit.
    And I think that it is a bearable burden. It was not, as you know, 
my first choice. We had a compromise Btu plan that was never really 
considered that exempted agriculture, exempted all production, and 
broadened the base of the tax to even it out a little. But I think that 
this is something that we can clearly manage given the fact that 
gasoline is at it's lowest real price in 30 years.
    Q. [Inaudible]
    The President. Well, I told you what it will amount to. It can 
amount to about a dollar a week for a middle income family, a family 
with an income of $40,000 to $50,000 a year. I don't think that will be 
a significant burden.
    And in terms of the energy industry, we had people from three energy 
companies here today, ARCO, Sun Oil, and Citgo, as well as the CEO of 
Tenneco here supporting the plan because they believe that bringing the 
deficit down, keeping interest rates down, which the deficit reduction 
plan is doing, enabling people to refinance their homes and business 
loans, and stabilizing the economy will do far more good than this will 
do harm. And I believe that, too.

Super Collider

    Q. I know you support the SSC, but about a week and a half ago, you 
strongly criticized Senator Gramm and Senator Hutchinson for calling for 
spending cuts while the House vote was going on. I think yesterday 
Senator Gramm sent you a letter urging you to pick up the pace of your 
support for the SSC. Can you get together with them and keep this 
project----
    The President. I'm a strong supporter of that project. And I worked 
it in the House. But, you know, the timing was amazing. I mean, I 
couldn't believe that they would walk

[[Page 1484]]

out on the steps of the Capitol with Ross Perot and begged the Congress 
to cut spending more and rail against taxes and give people the 
impression that there was some huge middle class tax burden in this 
thing, which is false. After the Senate Finance Committee had met and 
the Republicans offered not one single specific spending cut in the 
Senate Finance Committee--not one, not one dollar--and then, they go out 
on the steps of the Capitol, while we're doing our best not to get beat 
too bad in the House, hoping we can do what we did last time, pass it in 
the Senate and save it in the conference.
    You know, this is tough. I mean, you've got all those Congressmen 
from California. They took 40-something percent of the base-closing cuts 
this time, a State with second highest unemployment rate in the country. 
They take 40-something percent. Their Congressmen line up and vote for 
this program to benefit Texans with lower interest rates and a more 
stable economy. You know, and they say, ``Here's a State with a space 
station. Here's a State with all the benefits from the super collider.'' 
All they want to do is gain the political benefits of all this Federal 
spending and the political benefits of railing against the taxes and not 
have to take responsibility for proposing specific spending cuts. And 
it's just a little too much to swallow. You've got to put yourself in 
the position of people from other States. And so, they said, ``Let's 
just lob them one.'' And so we lost by this breathtaking margin, far 
worse than we lost last year.
    And then, of course, they want to disclaim any responsibility for 
that. I don't blame them, but I'm telling you--put yourself in the--
suppose you were from Idaho or Utah, or someplace that had hardly any of 
this stuff. Nobody's writing you Federal checks every month. You don't 
have hundreds of scientists and engineers and high-tech employees. It's 
just difficult for these Members that I'm lobbying to take.
    We came very close to losing the space station in the House. And two 
supporters of mine who were in a group that had already come against the 
space station stood down there in the well and waited until the last 
votes, and they realized that it could not prevail unless they changed 
their votes, and so they went down and voted for it.
    And that's how we saved the space station in the House. So, all I'm 
saying is, I believe in the super collider, and I believe in the space 
station. I believe we have now saved the space station, and I feel very 
good about it. And now I can sort of gin up my efforts on the super 
collider. We've got to pass it in the Senate to have any hope of getting 
it out of conference. All I can tell you is, you have to put yourself in 
the position of people from other States who have been asked to take the 
tough votes, take the hits, who've already voted for $250 billion of 
spending cuts, and then they're told by people who stand on the steps of 
the Capitol they hadn't cut spending. It just was difficult for them. 
And I thought it was kind of an interesting irony that at least they 
could have waited a day to do it, you know. They could have had the good 
grace to wait instead of just rubbing the Congress' face in their 
rhetoric.

Getting the Message Out

    Q. Why not talk about the economy if learning about the economy and 
learning about the problems with the economy and how deficit reduction 
can help the economy? Why not talk to the whole country about the 
economy, rather than each State individually?
    The President. Well, I intend to do that also. But one of the 
problems is that, as those of you who are in this town know, what really 
makes news is controversy. I mean, the President can't just go talk to 
the country whenever he pleases. Last time I talked to the country, this 
program had good support because I was able to give out all the 
information. Since then, it's just been rhetoric, 10-second sound bites, 
taxes, or ``it's spending, stupid,'' or something like that. And the 
whole facts don't get out.
    So one of the things I can do to reach the whole country is to spend 
more time with media from many States. We're doing this with a lot of 
States. I will, I hope, have the chance to address the country again. 
But I tried to do this in a national press conference, and only CNN and 
one network covered it. And by the way, the research showed that

[[Page 1485]]

the people who saw it on the network that covered it had their attitudes 
markedly altered about the economic plan. So I'm doing the best I can to 
get information out.

NAFTA

    Q. [Inaudible]--Corpus Christi. But we live in an area, because 
we're so close to the border that if things go sour in the U.S., we get 
hit; and if things happen in Mexico we feel it also. So we're looking at 
the North American Free Trade Agreement. Can you bring us up to date on 
that one?
    The President. Yes. We're making good progress on our efforts to 
achieve agreements relating to the environment and labor standards. The 
last reports I have are quite good. And I think that when those 
agreements are finalized and announced that we will really diminish at 
least the fervor of some of the opposition to NAFTA. We're also making 
good progress in getting a broad base of support for it. And I still 
believe we can go forward with it and pass it this year. There is an 
awful lot of opposition to it in the House and some in the Senate. You 
may have seen recently that some Congressmen were asking me virtually to 
delay consideration indefinitely. But we have to take it up this year. 
And I expect to do that.
    And I think the more we talk about it--I think the important thing 
with NAFTA is to try to--as I believe with a lot of these things, by the 
way. And because NAFTA will have bipartisan support and bipartisan 
opposition, we may be able, funny enough, to have a calmer conversation. 
We may be able to talk to each other as if we're all in the family.
    I mean, one of the things that I tell people about NAFTA, is I was 
Governor of a State where people shut their plants down and moved it to 
Mexico. I know a lot about that. But the point--if we have no NAFTA, as 
you well know, that will continue or could continue. NAFTA is not about 
stopping that or accelerating that. That is virtually irrelevant to what 
we're trying to achieve. And I think it's quite important.
    So we're making good progress. I expect to go forward. I have high 
hopes. We've got a lot of opposition, but I think if we can really be 
calm and talk each other through it, we can make it.

Deputy Counsel Vincent Foster, Jr.

    Q. We've heard conflicting stories about--this is on another 
subject. On the telephone call that you made to Mr. Foster, we heard at 
one point it was made on Sunday, then we heard it was made on Monday. 
And we heard, oh, it was just a routine call, because you talk all the 
time. And then we heard it was to buck him up. Can you sort of set the 
record straight?
    The President. I called him Monday night because at the last 
minute--Hillary was gone, was still in Arkansas with our daughter. And I 
decided to watch a movie, and Webb Hubbell was still hanging around 
here. And I hadn't seen Vince in a while, and I called him. I didn't--
unlike some other people, who did know that he'd been quite distressed, 
I was not really aware of that. But I knew I hadn't seen him in a while, 
and I just kind of got lonesome. Webb Hubbell and I and one or two other 
people were going to watch a movie. So I just wanted to watch the movie. 
I called him and we talked for, I don't know, 20 minutes or so. We 
talked about what he'd done the weekend before, talked about some things 
he was concerned about on the job, but it was just the sort of thing 
we'd always talk about. He was real work-oriented. And we agreed to meet 
on Wednesday. And that was it.

House Budget Language

    Q. There has been a difference between the House and Senate on 
capping entitlement programs. What is your position on that?
    The President. You mean because the House version has stronger 
language in it?
    Q. Right.
    The President. Well, I'm glad you asked that. Now, here's something 
you all can help on. The House version, first of all, has some 
disciplined language in there with dealing with the entitlements and 
also has some language which says that--well, first let me say, we adopt 
5-year budgets around here. I think you know--all of you, or the groups 
that you work for--it's very hard to adopt a 5-year budget with 
exactitude. I mean, nobody can see the 5 years with absolute precision.
    So what this House bill does that had never been done before is not 
only to put all this

[[Page 1486]]

money in a trust fund so it can't be spent on anything else but to say 
if we miss the target in any year, in any of these areas--you know, the 
targets on discretionary spending, entitlements, or revenues--whatever 
reason, we don't make our deficit reduction target, under this bill, the 
President must propose a plan to correct it, to meet the target, and the 
Congress must vote on it. Now, the Congress, obviously, wouldn't have to 
do exactly what I wanted. They could amend it, you know, but at least 
there's a process there for addressing the fact that we're missing the 
deficit reduction target.
    I feel very strongly that that should be a part of the final 
package. You need to know what the problem is. Under the rather arcane 
rules of the Senate, this reconciliation, economic budget plan, is just 
about the only thing--I think the only thing that does not require--it's 
not subject to a filibuster. So if you get one more vote than half, you 
win, and it can't be filibustered, because the country has to have a 
budget.
    But if there is any subject in this reconciliation bill that does 
not directly relate to the budget itself, it can be challenged and then, 
in effect, you can require 60 votes to put it in there. This mechanism 
has been challenged by the Republicans in the Senate, even though I 
believe 100 percent of them are for it. I mean, I believe 100 percent of 
them honestly want to get the deficit down and believe that this 
discipline ought to be in there, and they're still fighting it because 
it's another way to derail what we're trying to do. So the way to get it 
in there is for at least four or five of them to let that go in the law 
because it's good Government. It doesn't have anything to do with party.

Bosnia

    Q. Regarding the situation in Bosnia, now that you have met with 
Secretary Christopher, can you tell us a little bit about your options 
in the air strikes?
    The President. Well, we expect the U.N. forces there in Bosnia to 
communicate--the commander there to communicate to Boutros-Ghali what 
the situation is and what he wants, and then the Secretary-General of 
the U.N. will either make or will not make a request to NATO. And all 
this will unfold over the next few days during which time the Serbs, 
Bosnian Serbs, either will or won't stop shelling Sarajevo and will pull 
back. And we'll just have to wait and see what happens.
    But the United States is bound--we are committed to come to the aid 
of the United Nations forces as a part of NATO if they are attacked, and 
they have been. So we're just going to have to wait and see what 
happens.

NAFTA

    Q. On NAFTA, are you telling all the Members of Congress what will 
happen to us if we have a disagreement with Mexico about rates and about 
products? And isn't it true that panels of young lawyers from Europe 
could come over here and decide questions of difference between us and 
Mexico about the operation of NAFTA?
    The President. You mean under the agreements now being negotiated?
    Q. ----and come back, and regardless of what our laws were, they 
would be the ones to decide whether we were fair or not. And if they 
decide we were not fair, even if it was something that conflicted with 
our laws, they would prevail.
    The President. Well, I haven't agreed to any specific enforcement 
mechanism. But one of the things that has been of some controversy is 
the--obviously the Mexicans have not wanted to accede control of their 
national sovereignty to the United States and vice versa. So the 
Mexican, Canadian, and American negotiators have been struggling to find 
a way to adopt an agreement that had some teeth in it, that has some 
enforcement provision, at least if there were a pattern and practice of 
violation on their part or on ours. And I don't think they have 
finalized that. Until they do, I can't really say more.
    Q. [Inaudible]--the Republicans in the House are saying that our 
sovereignty would go and you all would have to, under the rules, that 
you would have to give in to this panel of lawyers from outside the 
country who would decide these matters.
    The President. Well, I can't comment on that because I don't know 
what they are finally going to agree to. But I think that the most 
important thing from my point of view is that we have some way of 
knowing that whatever we agree to is going to be observed

[[Page 1487]]

by all countries and that it is not a violation of our sovereignty to be 
held to the agreements, to be held to keep our word. And we'll have to 
find some sort of mechanism to see that we do it and to see that the 
Mexicans do it. Nobody has discussed the option you just described to 
me, and I can't comment on it until I know whether it's a live option.

Politics of the Economic Program

    Q. Back to your economic plan. The conservative Democrats on both 
Houses are the ones who are really key to you. One of those 
conservatives is a key player, Charlie Stenholm, who was visiting with 
you last night. He came out saying that he still is unalterably opposed 
to the gasoline tax. What can you tell those conservative Congressmen, 
many of whom come from Texas, what basically can you give them to get 
their vote?
    The President. Well, let me tell you what they say. I mean, it's 
interesting what a lot of them say who aren't for the gasoline tax. They 
think that it raises so little money that it's not worth the political 
heat. A lot of them are basically tired of the partisan beating up 
they've gotten for trying to do something responsible about the deficit. 
They are frustrated that all of their attempts to put in more spending 
discipline--and Charlie Stenholm has done, I think, a brilliant job of 
that--has not generated any willingness on the part of Republicans to 
support any kind of reasonable budget package.
    And so they're saying that this is a pure matter of public 
perception: ``Why for a relatively small amount of money should we have 
any gas tax at all since it is a modest one and give the Republicans 
something else to beat us over the head? Why don't we just keep the 
upper income taxes and the spending cuts and go on?'' Here's the answer 
to that, and it's the question I pose to them. In other words, there's 
no--it's just not like the Btu tax. You can't make a claim that it's 
promoting great energy conservation or it's good for the environment or 
anything. It's just a very modest attempt to raise some funds to pay 
down the deficit and monies which someday might go into road building 
after the end of the deficit reduction period but not any time in the 
foreseeable future.
    The answer is this: If we have to pass this bill with only 
Democrats, there are other conservative and moderate Democrats who don't 
object to the gas tax but would object if we took out the economic 
growth incentives. And let me just mention some of them. And there are 
others who would object if we didn't reduce the deficit by $500 billion 
or some figure very close to it. So then the issue is, if you take out 
the gas tax, what do you replace it with? If you just say, ``Well, we'll 
just reduce the deficit by that much less,'' then you have all these 
people who say, ``Well, you lose me because we're not reducing the 
deficit enough.'' Or do you say, ``We'll take out the gas tax and we 
won't have any economic growth incentives.'' Now, let me mention some of 
them to just give you an example. Over 90 percent of the subchapter S, 
the small businesses in this country, will be eligible for a tax cut 
under this program because we double the expensing provisions. So any 
small business with adjusted gross income of under $140,000, which is 94 
percent of them, will be eligible for a tax cut under this program. They 
generate a lot of the jobs in America. That's a job program.
    We've got a provision in here to provide capital gains treatment--
big break in people who invest for 5 years in companies that capitalize 
at $50 million a year or less. We took out the surcharge on capital 
gains to give people incentives to invest so they can earn investment 
income at lower rates than the personal rates. We have increased the 
research and development tax credit. We've increased the incentives for 
investing in getting real estate and homebuilding going again. That's 
one reason the national realtors and the homebuilders have endorsed this 
plan, two predominately Republican groups.
    If you take all that out, you know, to keep the deficit number up, 
to get rid of the gas tax, then you lose a whole different group of 
Democrats. Then there are those who say, ``Well, we don't need the 
earned-income tax credit. Get rid of that and get rid of the gas tax.'' 
The problem is if you do that, you lose people who represent huge 
numbers of working poor. Eighteen percent of the work force in this 
country now, including a whole lot of folks in Texas, work 40 hours a 
week

[[Page 1488]]

and still live below the poverty line. That's a stunning statistic.
    Perhaps the most important social policy, if you will, that I would 
think virtually all Americans could agree on that this plan furthers is 
that this says, if you're one of those folks and you have children in 
your home, and you work 40 hours a week, the tax system will lift you 
above poverty so that nobody who works with children will be in poverty 
if this plan passes, once we get it fully phased in.
    So if you take that out, then you lose all those Democrats that 
represent that. So the real problem is it's really an arithmetic 
problem. If you want the progrowth, projobs incentives and you want to 
support work instead of welfare and you want to stay at $500 billion of 
deficit reduction or awfully close, how do you do it without this modest 
fuel tax?
    The only other option that was given is further cuts in Medicare, 
which in my opinion, again, would lose you a lot of Democrats, both 
people who are concerned about middle class elderly people on Medicare 
and people who are concerned about doctors, hospitals, home health 
providers, and others who are under reimbursed now and who just have to 
shift their costs onto the private sector.
    So if someone could solve that problem--I wouldn't say that problem 
couldn't be solved--but I think it is highly unlikely that a resolution 
of that--I'm sympathetic with Charlie Stenholm. He has been very 
courageous. He has been very helpful. He has done as much as any Member 
of the Congress in either party to really control the deficit. And 
nobody has a better record than he does in trying to control spending 
and control the deficit. And he's made a very compelling case, but I 
don't know how to solve it.

Economic Program

    Q. Given the fact that if your plan passes--it will probably do so 
without a single Republican vote--do you think it would be fair for the 
American people to give your administration all the credit or all the 
blame with the economic condition of the country over the next 3\1/2\ 
years?
    The President. No, but it'll probably happen anyway. [Laughter] That 
is, it will be fair to give the administration and those who voted for 
it the credit or the blame for whatever impact this has. And I think it 
will be basically positive. We know it will keep interest rates down. I 
mean, you've got Alan Greenspan, who's the Republican head of the 
Federal Reserve Bank, who has constantly told the Congress they need to 
do a deficit reduction package in this range, and they need to do it 
immediately to keep interest rates down and to help the economy to 
recover.
    But let me make two points. Just a substantive point--I don't want 
to talk about politics but just the substance of it. Number one, the 
country has been in an economic difficulty on and off for 20 years. The 
high water mark of American economic dominance was about 20 years ago. 
Since then the pressures of a global economy, which have punished the 
relatively undereducated, the relatively rural, the people that didn't 
fit very well in the global economy, have been building up and basically 
real wages of working people have been stagnant or declining, and the 
work week has been increasing for 20 years.
    For 12 years we have followed a path that worked in the short run 
but caused us great grief in the long time. That is, supply-side 
economics, which basically says we're going to cut taxes and increase 
spending, took us from a $1 trillion to a $4 trillion deficit--debt, a 
huge deficit. In the short run, we came out of the recession of '81-'82 
after we cut taxes and increased spending and kind of kept the lid on 
inflation. But in the long run we have dug ourselves into a hole now 
where we--for example, we actually--almost anybody--Charlie Stenholm 
said the other day, ``We need to be spending more money helping places 
like California and Connecticut and some other places to convert from a 
defense to a domestic economy. But we don't have the money. We need to 
do whatever we can to train our non-college educated workers better. We 
don't have the money. We've got a lot of things we need to do. We can't 
and we're paralyzed''. So I would say to you that we didn't get into 
this mess overnight. We're not going to get out of it overnight.

[[Page 1489]]

    The second thing I want to say is, we need to bring the deficit down 
to zero. To do that, we have to pass health care reform. Then to make 
people more productive we need to pass our education bill and the 
welfare reform bill, and we need to pass a lot of other things. There's 
lots of work we need to do here to open new markets--you asked the NAFTA 
question--to get this economy turned around. But I expect to be held 
accountable. I just would tell you, this bill is important. Without it, 
we can't go forward. But it is not the end-all and the be-all.

Embargoes on Cuba and Vietnam

    Q. One of the cornerstones of your whole program is to stimulate 
business growth. I'm just curious, do you believe that lifting the trade 
embargo against Vietnam at this time would benefit the economy? And a 
part two to that question: Do you believe that lifting the embargo 
against Cuba and allowing American businesses to trade in both Vietnam 
and Cuba would be good for the economy of this country?
    The President. I believe if the embargo were lifted, some businesses 
would clearly benefit. I think it would be a marginal benefit to the 
economy in the short run because the economies of both those countries 
are so small compared to ours. I don't think it would have a major 
impact. But I don't support it for different reasons. I think the 
embargo against Cuba should stand until there is a real movement toward 
freedom and democracy. I think the embargo against Vietnam should not be 
lifted until we have even more assurances that they are doing everything 
they can to help us with the POW-MIA issue.
    As you doubtless know, or you wouldn't have asked the question, I 
did remove the objections of the United States to letting Vietnam 
participate in International Monetary Fund financing, which will help 
them to improve, because they have taken a lot of steps since I've been 
President and since before I became President, starting right before I 
became President, to open up the country, to help us try to find the 
answers about our POW and MIA personnel. But I'm not confident that 
everything that should be done, has been done. And until I am, I can't 
support lifting that embargo.
    Q. I've talked to a couple of business people who say that telephone 
lines are burning up at the Commerce Department--[inaudible]--business 
people all over the country. I was in Vietnam and I met American 
business people who were there able to initial business contracts but 
couldn't sign them. I would just like to know, how much pressure are you 
getting from American businesses to lift the embargo?
    The President. Not much. Some. A lot of the business people want to 
do it, but I would hope that the business community would also 
understand that we have a lot of families out there, a lot of relatives, 
a lot of friends, and a lot of supporters of the people who have served 
who have never been accounted for. And that while we have gotten an 
awful lot of information in the last few months, even that has raised 
questions in some people's minds as why are we just now getting it, you 
know, and all of that.
    I think we are now getting real access to the country. We are making 
real progress. I just wrote a letter to the President in Vietnam, in 
response to a letter he wrote me, encouraging him to continue on this 
path. I know a lot of American businesses want to do business there, but 
that cannot be the sole criteria of what we do. And our first concern 
has to be for the POW's and the MIA's. We are moving in the right 
direction. Let's just hope it continues so we can continue to make 
progress.

Taxes

    Q. The American people are now being taxed in local and State and 
national levels up to 50 percent of what they are making. And we look 
back at the serfs in Europe, and they only had to give up 30 percent of 
their income, and we looked at them as slaves. Why are we any better 
than the serfs? And why have you been so loyal to promises to the 
homosexual community, but not quite so loyal with your tax cut promises 
to the middle class of America?
    The President. First of all, what you've said is not accurate. All 
major Western countries have higher tax rates than we do. You know, it 
does not serve the public debate to

[[Page 1490]]

tell people that Germany has had a higher growth rate than America 
because they have lower taxes. It's simply not true. It is absolutely 
untrue. National tax rates in Japan are much higher than they are here. 
And aggregate corporate rates in Japan at all levels of government will 
be higher than they are here even if my plan passes. And if you look at 
the percentage of income going to taxes in America, with the exception 
of some very high taxed urban areas, where the cost of living is very 
high, we compare very favorably, if this plan passes in toto, with the 
tax rates in all the countries with which we are competing. The problem 
with it is that we're not spending money on the right things. We're 
spending too much on interest on the debt. We're spending too much on 
health care. We're spending too little on things that create jobs and 
growth and opportunity. Nevertheless, I did not raise taxes happily 
here.

    I was Governor of a State that was always, always, every year I was 
Governor, was in the bottom five States in America in the percentage of 
people's income going to taxes. Always. And after I had been Governor 10 
years, the same percentage of income was going to taxes that was going 
10 years before. I never raised taxes to balance the books. The only 
times we ever raised taxes in Arkansas was for schools and roads and had 
the support of big majorities of the American people.

    I don't like this. I made it very clear why I decided to ask for a 
modest contribution from middle class families with incomes over 
$30,000, but under $140,000; no income tax increases until families who 
were basically families, if you had two earners above $180,000. And the 
reason is that after the election, the Government--the previous 
Government, not mine--estimated the deficit over the next 5 years to be 
about $150 billion bigger than they said it was before the election.

    So I had to face a decision. Was I going to try to do more on 
deficit reduction and try to deal with this and get these interest rates 
down, based on changed circumstances, minimizing the tax burden all I 
could and still asking the top--really over two-thirds of this burden 
will come from the top one percent of taxpayers, who got two-thirds of 
the benefits the last 12 years. Or was I going instead to do what was 
more politically popular and consistent with what I honestly believed in 
the campaign but not what I thought was best for Americans. And I 
decided the best thing to do would be to try to take account of the fact 
that the deficit was $150 billion bigger than we thought and to try to 
respond to it. The American people will have to decide whether they 
think that's right or wrong.

    Now, I have done my best to make the tax system fairer. I have done 
something for working families under $30,000 a year. They've all been 
held harmless. We've done something significant for the working poor. 
And I have 4 more years to try to deal with further inequalities in the 
tax system, which I plan to do. But I think this deficit has to be 
attacked first, and I think I did the right thing.

Space Station and the Super Collider

    Q. From a scientific standpoint, do you think the collider and space 
station are of equal merit? And would you be prepared to veto an energy 
and water preservation bill if it's not included in the collider 
funding?

    The President. Well, I don't know if I would be prepared to veto it. 
Nobody has ever asked me that, and I don't know what the consequences of 
that would be. I think that they are different, entirely different. The 
space station is important technologically, and it's important for our 
country's continued leadership in space, which is very important. It 
also has enormous international implications in terms of potential 
partnerships with Russia and with a lot of other countries.

    If we back off of this space station, other countries will move into 
the breach, they will push us out of an area that we plainly dominate 
the international economy in. They will make those partnerships, and we 
will be left, I think, without the leadership that we need and deserve 
and without the potential to create enormous economic opportunity, as 
well as political cooperation in the years ahead.

    It's interesting, and I'm glad you mentioned it. One of the things 
that is very important and quite apart from the technology

[[Page 1491]]

is that the promise of cooperation between the United States and Russia, 
and perhaps with other countries just emerging, is one of the main 
carrots we have if you will--not a stick but a carrot--to discourage 
countries from doing irresponsible things with nuclear weapons, with 
other weapons of mass destruction, discourage them from selling them to 
other people. So I think that's very, very important.
    Now the super collider is different. The space station is a 
technological wonder that maintains our leadership in an area we have 
already fleshed out. The super collider is science. It's research. 
Therefore, it is, by definition, less certain. But this country has 
gotten a long way throughout its history by taking a chance on things 
that might not be certain that promised enormous potential benefits. So 
the possible benefits of the super collider, the possible implications 
of it, in any number of areas of technology in the future, are 
absolutely staggering.
    Sure, it might not work. It's like any investment of this kind. But 
that's what science is. This is scientific research. This is an attempt 
to break down barriers of knowledge, to see the world in a whole 
different way, to unlock all kinds of secrets. And we have made a major 
investment in this. We also, by the way, can get some other countries to 
invest in it, but not if they have to sit around every year waiting to 
see if we're going to chuck it. I mean, one of the biggest problems 
we've had in getting these other countries who said they'd invest in it, 
is they don't know from one year to the next whether we're going to keep 
it. And one of the things that I hope we can do this year, if we can get 
it passed in the Senate, get it in the conference, is to get a 
commitment for a multiyear continuation of it.
    Now, it is more difficult to save than the space station simply 
because it's science instead of technology, if you see what I mean. It 
is by definition more theoretical. But I still think it's quite 
important, and I am hoping we can save it.
    Thank you.

Note: The interview began at 5 p.m. in the State Dining Room at the 
White House.