[Weekly Compilation of Presidential Documents Volume 29, Number 40 (Monday, October 11, 1993)]
[Pages 1982-1992]
[Online from the Government Publishing Office, www.gpo.gov]

<R04>
Remarks to the AFL-CIO Convention in San Francisco, California

 October 4, 1993

    Thank you very much. President Kirkland, distinguished platform 
guests, and to the men and women of the American labor movement, let me 
tell you first I am glad to be here. I feel like I'm home, and I hope 
you feel like you have a home in Washington.
    For most of the 20th century the union movement in America has 
represented the effort to make sure that people who worked hard and 
played by the rules were treated fairly, had a chance to become middle 
class citizens, raise middle class kids, and give their children a 
chance to have a better life than they did. You have worked for that. 
You have done that.
    For too long, in the face of deep and profound problems engulfing 
all the world's advanced nations, you have been subjected to a political 
climate in which you were asked to bear the blame for forces you did not 
create, many times when you were trying to make the situation better. I 
became President in part because I wanted a new partnership for the 
labor movement in America.
    Before I get into the remarks that I came here to make about all of 
our challenges at home and the economic challenges facing us, I have to 
make a few remarks this morning about developments in the world in the 
last 48 hours.
    The labor movement has been active, particularly in the last few 
years with the end of the cold war, in the effort to promote democracy 
abroad, to guarantee the right of people freely to join their own 
unions, and to work for freedom within their own countries. In that 
context most of you, I know, have strongly supported and looked with 
great favor on the movement toward democracy in Russia.
    The United States continues to stand firm in its support of 
President Yeltsin because he is Russia's democratically elected leader. 
We very much regret the loss of life in Moscow, but it is clear that the 
opposition forces started the conflict and that President Yeltsin had no 
other alternative than to try to restore order. It appears as of this 
moment that that has been done. I have as of this moment absolutely no 
reason to doubt the personal commitment that Boris Yeltsin made to let 
the Russian people decide their own future, to secure a new Constitution 
with democratic values and democratic processes, to have a new 
legislative branch elected with democratic elections, and to subject 
himself, yet again, to a democratic vote of the people. That is all that 
we can ask.
    I think also, most of you know that in a military action yesterday, 
the United States sustained the loss of some young American soldiers in 
Somalia. I deeply regret the loss of their lives. They are working to 
ensure that anarchy and starvation do not return to a nation in which 
over 300,000 people have lost their lives, many of them children, before 
the United States led the U.N. mission there, starting late last year. I 
want to offer my profound condolences to the families of the United 
States Army personnel who died there. They were acting in the best 
spirit of America.
    As you know, the United States has long had plans to withdraw from 
Somalia and leave it to others in the United Nations to pursue the 
common objectives. I urged the United Nations and the Secretary-General 
in my speech at the United Nations a few days ago to start a political 
process so that the country could be turned back over to Somalis who 
would not permit the kind of horrible bloodshed and devastation to 
reoccur. And I hope and pray that that will happen. In the meanwhile, 
you may be sure that we will do whatever is necessary to protect our own

[[Page 1983]]

forces in Somalia and to complete our mission there.
    From the struggle against communism in Eastern Europe to the 
struggle against apartheid in South Africa, the union movement in 
America has always answered the challenges of our time. It must be a 
source of great pride to you to see these elections unfold, to see the 
remarkable movement toward a genuine multiracial society within a 
democratic framework in South Africa. It must, likewise, be a source of 
continuing frustration to you to see that even as the ideas and the 
values that you have espoused now for decades are being embraced around 
the world, here in our country and in virtually every other wealthy 
country in the world, middle class workers are under assault from global 
economic forces that seem beyond the reach of virtually any government 
policy.
    We now know that every wealthy country in the world is having 
trouble creating jobs. We now know that in the last several years, 
inequality of income got worse in every major country. We know that we 
had more growing inequality in America than anyplace else because we 
actually embraced it. I mean, the whole idea of trickle-down economics 
was to cut taxes on the wealthiest Americans, raise taxes on the middle 
class, let the deficit balloon, and hope that the investment from the 
wealthy would somehow expand opportunity to everybody else.
    We know that didn't work, and it made the situation worse. It left 
us with a $4 trillion debt. It left us with a deficit of over $300 
billion a year. It left us with a legacy of weakened opportunities for 
workers in the workplace, too little investment, a paralyzed budget, and 
no strategy to compete and win in the global economy, and more 
inequality in America than any of the other wealthy countries. But we 
also know that the same problems we have are now being found in Germany, 
in Japan, in all of Europe, in the other advanced nations.
    So we have to face the honest fact that we are facing unprecedented 
challenges in our own midst to the very way of life that the labor 
movement has fought so hard to guarantee for others around the world for 
decades. And therefore, it is important that we think through these 
issues, that we take positions on them, that we agree and that we 
disagree in the spirit of honest searching for what the real nature of 
this world is we're living in and where we are going.
    The most important thing to me today is that you know that this 
administration shares your values and your hopes and your dreams and the 
interest of your children, and that together--[applause]--and that I 
believe together we can work our way through this very difficult and 
challenging time, recognizing that no one fully understands the 
dimensions of the age in which we live and exactly how we are going to 
recreate opportunity for all Americans who are willing to do what it 
takes to be worthy of it.
    The labor movement, historically, has always been on the cutting 
edge of change and the drive to empower workers and give them more 
dignity on the job and in their lives. Almost a half a century ago, at 
the end of World War II, labor helped to change America and the world. 
At home and abroad, labor helped to create a generation of prosperity 
and to create the broad middle class that we all cherish so much today.
    Now we have to do it again. We're at a time of change that I am 
convinced is as dramatic as the dawning of the Industrial Age. We can no 
longer tell our sons and daughters--we know this now--that they will 
enter a job at the age of 18 or 21, enjoy secure paychecks and health 
benefits and retirement benefits for the rest of their working lives and 
retire from the same job with the same company at the age of 65 or 62.
    Our changing economy tells us now that the average 18-year-old will 
change work seven times in a lifetime even if they stay with the same 
company and certainly if they change; that when people lose their jobs 
now, they really aren't on unemployment, they're looking for 
reemployment; that most unemployment today is not like it used to be: 
When people got unemployed for decades, it was because there was a 
temporary downturn in the economy, and when the economy turned up again, 
most people who were unemployed were hired back by their old employer. 
Today, most people who are unemployed eventually get hired back usually 
by a different employer for a different job and unless we are very good 
at what we do for

[[Page 1984]]

them, often at lower wages and less benefits. So it is clear that what 
we need is not an unemployment system but a reemployment system in 
recognition of the way the world works today.
    We know, too, that most American working people are working harder 
than they ever have in their lives; that the average work week is longer 
today than it was 20 years ago; that real hourly wages adjusted for 
inflation peaked in 1973, and so most people are working harder for the 
same or lower real wages than they were making 20 years ago.
    We know that in the eighties there was a dramatic restructuring of 
manufacturing; that being followed in the nineties with a dramatic 
restructuring of the service industries. We know that for the last 12 
years, in every single year, the Fortune 500 companies lowered 
employment in the United States in six figures, and that in the years 
where we have gained jobs, they've come primarily from starting new 
businesses and from companies with between, say, 500 and 1,000 workers 
expanding, as the whole nature of this economy changes.
    We know that the cost of health care has increased so much that 
millions of American workers who kept their jobs never got a pay raise 
because all the increased money went to pay more for the same health 
care. We know that some of our most powerful industrial engines, 
especially in industries like autos and steel have shown breathtaking 
increases in productivity with deep changes in the work force supported 
by the labor movement, and still are having trouble competing in the 
world, in part, because their health costs may be as much as a dime on 
the dollar more than all of their competitors.
    We know, as I said at the beginning, that all the wealthy countries 
in the world are now having trouble creating jobs. If you look at 
France, for example, in the late 1980's, they actually had an economy 
that grew more rapidly than Germany's, and yet their unemployment rate 
never went below 9.5 percent.
    So what are we to do? It seems to me that we clearly have to make 
some changes in the way we look at the world and the way we approach the 
world. And in order to make those changes, we have to ask ourselves, 
what do we have to do to make the American people secure enough to make 
the changes? One of the things that has really bothered me in the late, 
latter stages of this era that we're moving out of is that so few people 
have been so little concerned about rampant insecurity among ordinary 
American middle class citizens. It is impossible for people in their 
personal lives to make necessary changes if they are wildly insecure.
    You think about that in your own life. You think about a personal 
challenge you faced, a challenge your family has faced. The same thing 
is true in the workplace. The same thing is true of a community. The 
same thing is true of a team. The same thing is true of our country. We 
have to struggle to redefine a new balance between security and change 
in this country because if we're not secure, we won't change, and if we 
don't change, we'll get more insecure, because the circumstances of the 
world will continue to grind us down.
    And that's what makes this such a difficult time, because we have to 
rethink so many things at once. I ran for President because I was tired 
of 20 years of declining living standards, of 12 years of trickle-down 
economics and antiworker policies, and rhetoric that blamed people who 
are working harder for the problems that others did not respond to, and 
because I believe that we needed a new partnership in America, a new 
sense of community, not just business and labor and government but also 
people without regard to their color or their region or anything else. I 
thought we didn't have anybody to waste, and it looks to me like we were 
wasting a lot of people and that we needed to put together. I thought 
the country was going in the wrong direction, and we should turn it 
around. But I was then and am now under no illusions that we could do it 
overnight or that I could do it, unless we did it together.
    The beginning of the security necessary to change, I think, is in 
having a Government that is plainly on the side of working Americans. I 
believe that any of your leaders who work with this administration will 
tell you that we are replacing a Government that for years worked labor 
over, with a Government that works with labor. We have a Secretary of 
Labor in Bob Reich who understands that, at a time when money and 
management can

[[Page 1985]]

travel across the globe in a microsecond, our prosperity depends more 
than anything else on the skills and the strengths of our working 
people. No one can take that away from us. And our people are still our 
most important asset, even more than they were 20 years ago.
    We have nominated a Chair of the National Labor Relations Board in 
Bill Gould, and a new member, Peggy Browning, who believe in collective 
bargaining. We have a Director of the Occupational Safety and Health 
Administration in Joseph Dear who comes from the labor movement and 
believes that workers should be protected in the workplace. We have two 
people in executive positions in the Labor Department in Joyce Miller 
and Jack Otero who were on your executive council. We have two people in 
the SEIU in executive positions in Karen Nussbaum and Jerry Polas who 
are leading us to make progress.
    This administration rescinded President Reagan's order banning all 
reemployment of PATCO workers forever. And we rescinded President Bush's 
orders with regard to Government-funded contracting and one-sided 
information given to workers in the workplace. And this week I will sign 
the Hatch Act Reform Act to give Government employees political rights 
they have been denied for too long.
    One week ago yesterday, on a Sunday morning, I came in from my early 
morning run, and I turned to my right as I walked into the White House, 
and I saw a family standing there, a father, a mother, and three 
daughters, one of whom was in a wheelchair. And the person who was with 
them who worked for me said, ``Mr. President, this little girl has got 
terminal cancer, and she was asked by the Make A Wish Foundation what 
she wanted to do, and she said she wanted to come to the White House and 
visit you. So we're giving her a special tour.''
    So I went over, and I shook hands with them and apologized for my 
condition and told them I'd get cleaned up and come back, and we'd take 
a picture. And a few minutes later I showed up, looking more like my 
job. And I visited with this wonderful child, desperately ill, for a 
while. And then I talked to her sisters, and then I talked to her 
mother. And I talked to her father. And as I turned around to go off, 
the father grabbed me by the arm and he said, he said, ``Let me tell you 
something. If you ever get to wondering whether it makes a difference 
who's the President,'' he said, ``look at my child. She's probably not 
going to make it, and the weeks I've spent with her have been the most 
precious time of my life. And if you hadn't been elected, we wouldn't 
have had a family and medical leave law that made it possible for me to 
be with my child in this time.''
    Now, I believe, in short, that it ought to be possible to be a good 
parent and a good worker. I believe that it ought to be possible for 
people to make their own judgments about whether they want to be 
organized at work or not and how they're going to be--[applause]. And I 
believe if we're really going to preserve the American workplace as a 
model of global productivity, we have to let people who know how to do 
their jobs better than other people do have more empowerment to do those 
jobs and to make those changes in the workplace.
    That's why, as we work on the Vice President's reinventing 
Government initiative, we work so closely with Federal employees and 
their unions. When the Vice President spoke with business leaders and 
workers who had changed their companies, they all said the same thing: 
You've got to have the workers; you have to have them do it, tell you 
how to do it, tell you how to make the companies more productive.
    Now, that's why yesterday I signed an Executive order--on Friday--
creating a National Partnership Council. For the next several months the 
leaders of Federal employee unions, including John Sturdivant, the 
president of the American Federation of Government Employees, who is 
here today, will work with the leaders of our administration to make our 
Government more effective, cost less, and more importantly, to make the 
jobs of the rank and file Federal employees more interesting, more 
stimulating, more customer-oriented, by doing things that they have been 
telling us they should be able to do, but that the system has not 
permitted them to do in the past. I applaud John and the other people in 
the unions representing Federal employees for what they have done.

[[Page 1986]]

This is an unprecedented partnership that I think will benefit every 
American.
    We want to make worker empowerment and labor-management cooperation 
a way of life in this country, from the factory floor to the board room. 
We've created a commission on the future of labor and management 
relations, with leaders from labor, business, and the academy, chaired 
by former Labor Secretary John Dunlap. And I've asked Secretary Reich to 
create a commission to study and improve relationships in government 
workplaces at every level, at the State and county and local level, as 
well as at the Federal level.
    I believe this is something that a person like Bob Reich is uniquely 
situated to do. And it's the kind of thing that we ought to be promoting 
because we have to use this opportunity we have to try to take what has 
worked for workers and their businesses and spread it around the 
country.
    For the last 12 years we've had a lot of finger-pointing and blame-
placing, and we've got these stirring examples of success that we could 
be trying to replicate. That's what we ought to be doing, taking what 
works. And it always is a workplace in which workers have more say. And 
we're going to do what we can to get that done.
    Now, on the security issue, let me just mention some other things. 
In addition to the family leave act, the budget bill which passed by 
such a landslide in the Congress contained what may well be the most 
important piece of economic reform for working people in 20 years, by 
expanding the earned-income tax credit so that you can say to people, if 
you work 40 hours a week and you have children in your home, you will 
not be poor. We are bringing new hope and new dignity into the lives of 
15 million working families that make $27,000 a year or less. They'll no 
longer be taxed into poverty. There won't be a Government program to try 
to lift them out of poverty. Their own efforts will lift them out of 
poverty because the tax system will be changed to reward them. And there 
will never again be an incentive for people to be on welfare instead of 
work because the tax system will say, if you're willing to go to work 
and work 40 hours a week, no matter how tough it is, we will lift you 
out of poverty. That is the kind of prowork, profamily policy this 
country ought to have.
    Something else that was in that bill that most Americans don't even 
know about yet that will benefit many, many of you in this room and the 
people you represent is a dramatic reform of the student loan system 
that will eliminate waste, lower the interest rates on student loans, 
make the repayment terms easier so that young people can repay their 
loans no matter how much they borrow as a percentage of their income, 
limited so they can repay it. Even though we'll have tougher repayment 
terms, they'll be able to do it. We'll collect the money, but people 
will be able to borrow money and pay it back at lower interest rates, at 
better repayment terms. And therefore, no one will ever be denied access 
to a college education because of the cost.
    When you put that with our Goals 2000 program, the education reform 
program for the public schools, and the work that the Education 
Secretary Dick Riley is doing with Secretary Reich to redo the worker 
training programs in the country, you have a commitment to raise 
standards in education and open opportunities to our young people.
    We need higher standards in our public schools. Al Shanker has long 
been a voice for that. He now has allies in the NEA and other places in 
the country who are saying, ``Let's have national standards and evaluate 
what our kids are learning and how our schools are doing.''
    I believe we need to give our young people more choices within the 
public school system, and I have advocated letting States try a lot of 
things within districts. Let kids choose which schools they attend. Let 
school districts decide how they want to set up and organize schools. I 
think that a lot of changes need to be made in a lot of school 
districts. But let me say that we don't want to throw out the baby with 
the bath water. There are also a lot of school districts that are doing 
a great job under difficult circumstances. There are a lot of schools 
within school districts that are performing well under difficult 
circumstances.
    And if we've learned anything, we've learned that the best way to 
increase the quality of education is to find better prin- 

[[Page 1987]]

cipals, get better leaders among the teachers, let them have more say 
over how school is run, and evaluate them based on their results rather 
than telling them how to do every last jot and tiddle of their job every 
day.
    We have learned these things--and if I might, since we're in 
California, say a special word--therefore, I believe that having worked 
for 12 years for higher standards, more choices and greater changes in 
public education, I'm in a little bit of a position to say that if I 
were a citizen of the State of California, I would not vote for 
Proposition 174, The Private Voucher Initiative.
    Now, and let me tell you why. Let me tell you why. First of all, 
keep in mind a lot of the schools out here are doing a good job. I can 
say this, you know, I never was part of the California education system. 
I have studied this system out here for more than a decade. They have 
undertaken a lot of very impressive reforms and many of their schools 
are doing a good job. I was interviewed last night by two people from a 
newspaper in Sacramento, and one of them just volunteered that he had 
two children in the public schools there, and they were getting a 
terrific education.
    This bill would start by taking $1.3 billion right off the top to 
send a check to people who already have their kids in private schools, 
and who didn't need any Government money to do it, and taking it right 
off the top away from a school system that doesn't have enough money to 
educate the kids it's got in it in the first place.
    Second thing it would do is to impose no real standards on the 
quality of the programs which could be funded: who could set up a 
school; what standards they'd have to meet; what tests the kids would 
have to pass. Just take your voucher, and who cares whether a private 
school is a legitimate school or not. That is a significant issue. And 
all you have to do is to work in this field for a few years to 
understand that that is a significant issue.
    Wouldn't it be ironic that at the very moment we're finally trying 
to find a way to measure the performance and raise the standards of the 
public schools, we turn around and start sending tax money to private 
schools that didn't have to meet any standards at all. When we're trying 
to get one part of our business, we're going to make the other part 
worse.
    And finally, let me just say, I have always supported the notion 
that American schools ought to have competition and the fact that we 
have a vibrant tradition of pluralistic education and private schools 
and religious private schools was a good thing, not a bad thing for 
America. But all the years when I grew up, and all the times I saw that, 
and for a couple years of my life when I was a little boy, when I went 
to a Catholic school, when my folks moved from one place to another, and 
we lived way out in the country and didn't know much about the schools 
in the new area where we were, no one ever thought that the church would 
want any money from the taxpayers to run their schools. In fact, they 
said just the opposite, ``We don't want to be involved in that.'' That's 
what the First Amendment is all about.
    So I think we have to really think through--I have spent 12 years 
before I became President overwhelmingly obsessed with reform of the 
public school system, wanting more choices in the system, wanting more 
accountability, wanting more flexibility about how schools were 
organized and established and operated. But I can tell you that this is 
not the way to get it done, and the people will regret this if they pass 
it. I hope the people of California don't do that.
    Now, you can educate people all you want--and I wanted to say a 
little more about that. The Labor Secretary and I are working on trying 
to take all these 150 different Government training programs and give 
local communities and States the power to consolidate them, working with 
you, and just fund the things that work on a State-by-State basis, and 
to set up a system of lifetime education and training.
    I don't know how many of you saw the television program I did last 
night in California, but one man, looked to be in his early fifties, 
saying, ``We need a training program that gives my company some 
incentives to retrain me, not just people who are 25, but people who are 
55.'' And we are trying to do that. We're trying to set up a lifetime 
education and training program that starts when young people are in high 
school, so if they

[[Page 1988]]

want to work and learn in high school they can work and learn in high 
school, so that we can have the kind of school-to-work transition that 
many of our competitors have for all those kids that won't go to college 
and won't get 4-year educations. We've got to do that.
    But if you do all that, you still have to have someplace for people 
to work. We can educate and train people all we want, but we have to be 
able to create more jobs. How are we going to do that at a time when the 
Government is not directly funding the defense jobs that have kept 
America's job base up for so long?
    Well, the first thing we've got to do is make up our mind we're 
going to be serious about defense conversion. Last year when I was a 
candidate for President--[applause]--last year when I was a candidate 
for President, I went all over the country--and I wasn't in the Congress 
and didn't have a vote--pleading with the Congress to pass the defense 
conversion bill. They did it, and the previous administration absolutely 
refused to spend $500 million to help convert from a defense to a high-
tech domestic economy. So we have released the money. And we're going to 
try to get up to $20 billion spent on defense conversion and 
reinvestment in the jobs of tomorrow over the next 5 years. It is very 
important.
    We have got over 2,800 proposals in this country for technology-
reinvestment initiatives, to match with what will soon be about a 
billion dollars in Government money that can create hundreds of 
thousands of jobs in America. People are brimming with ideas out there 
to create new jobs.
    I was at McClellan Air Force Base yesterday, and the airbase is 
working with people in the local community and the local universities 
and with the Federal defense labs. They have made new electric cars. 
They have made new manufacturing component parts to try to come up with 
economical ways to do it and allow those parts to be made in America. 
And they are targeting things that are now made overseas and imported 
here. That's the sort of thing that we can use our high-tech defense 
base to do, and we should be doing it. It's going to make for more jobs 
for America.
    They have developed a prototype car that gets 80 miles per gallon at 
55 miles per hour on the highway, goes to 60 miles per hour in 12 
seconds, has a maximum speed of 100 miles an hour. That's not bad. If we 
can just figure out how people can afford it, we can put people to work 
making them. But it's a good beginning.
    We announced last week that ground-breaking project with the UAW and 
Ford, Chrysler, and General Motors are working with the defense labs and 
all the Government labs on a project to triple the average mileage of 
American autos within the next 10 years. If they do that, that will 
create untold numbers of new jobs here, and we'll be selling cars to 
people overseas who want that instead of the reverse.
    And by the way, I want to compliment the UAW. You know, this year we 
have regained a lot of our market share in America. People are buying 
more American cars in America, and we should compliment them for it.
    So we have to find ways to create these new jobs. Now, I want to 
talk a little about health care, but before I do, I want to mention 
something we disagree on in the context of the trade issue. And listen 
to this. Since 1986, a significant portion of America's net new jobs 
have come from trade growth. That's something we can all find from the 
figures. In California, where we now are, a lot of that has come from 
Asia, which is the fastest growing part of the world. Asia's growing 
faster than any other part of the world; Latin America the second 
fastest growing part of the world. Everybody knows that is true.
    Now, that's why, when I went to Tokyo and met with the leaders of 
the G-7, the seven big industrial countries, we made an agreement that 
we should dramatically reduce tariffs on manufactured products around 
the world in ways that all analysts agree would generate a lot of new 
manufacturing jobs here in America. There was virtually no dispute about 
that, because we were largely in competition with other countries that 
were paying the same or higher wages with the same or better benefits, 
with high-tech and other manufacturing products that we wanted to sell 
everywhere. And we're

[[Page 1989]]

working like crazy to get that done between now and the end of the year.
    What is the difference between that and the trade agreement with 
Mexico? And let's talk about that just a minute, because it's very 
important, not so you'll agree with me but so you will know what I want 
you to know, which is that I would never knowingly do anything to cost 
an American a job. That's not the business I'm in.
    I was a Governor during the last 12 years, when the maquilladora 
system was in place. What did it do? It created a border zone on the 
other side of the border in Mexico in which people were free to set up 
plants, operate them by the standards that were enforced there--or not 
enforced, as the case may be--on labor and environmental issues, and 
then send their products back into this country, produced at much lower 
labor costs with no tariffs. That was the system set up to try to foster 
growth there.
    But in the 1980's, because of all the economic problems we had, and 
because of the climate that was promoted in this country that the most 
important thing you could do was slash your labor costs and who cared 
about your working people anyway, you had the movement of hundreds of 
plants down there. And you didn't like it worth a flip. And you were 
right to be upset about what happened.
    Now, I was a Governor of a State that lost plants to Mexico. And my 
State was so small that when people lost their jobs I was likely to know 
who they were. This was a big deal to me. I'm also proud of the fact we 
got one of them to come back before I left office. I'm proud of that, 
too. But I understand this.
    Now, that is the system we have. You also saw this system, 
ironically, accelerating illegal immigration. Why? For the same reason 
that a lot of the Chinese boat people were coming over here after they 
moved to the coastal towns in China, got a job where they made a little 
more money than they did before, but didn't much like their life, but 
they got enough money to try to come here. That's what was happening 
along the maquilladora area. A lot of people would come up there, work 
for a while, then come on up here.
    So I understand what the American working people don't like about 
the present system. The real issue: Will the trade agreement make it 
worse or better? You think it will make it worse. I think it will make 
it better. And I'll tell you, I think you're entitled to know why I 
think that. Because there is no question that, no matter what you think 
about the adequacy of the side agreements, they will raise the cost of 
labor and environmental investments above the point where they are now. 
There is no question that the agreement lowers domestic content 
requirements in Mexico, so that we'll go from selling say 1,000 to 
50,000 or 60,000 American cars down there next year. There's no question 
that their tariffs are 2\1/2\ times higher than ours. And there's no 
question that we have a trade surplus there, as compared with a $49 
billion trade deficit with Japan, an $18 billion trade deficit with 
China, a $9 billion trade deficit with Taiwan.
    We've got a trade problem, all right. It is that the Asian economies 
are not as open to us as we are to them. That's our huge trade problem. 
And we're going to have to do better there, because that's where a lot 
of the money is. So my reasoning is that if their tariffs are higher 
than ours and their costs go up faster than they're otherwise going to 
go up, and they're already buying $350-a-person worth of American goods, 
second only to Canada--replaced Japan as the number two purchaser of 
manufacturing products this year--and we got a $5.8 billion trade 
surplus, it will get better, not worse.
    Is it a perfect agreement? No. But I don't want to make the perfect 
the enemy of the better. I think it is better than the present.
    There are two other points I want to make. If the deal is not made 
with the United States, and instead it's made with Germany or Japan, we 
could lose access to an 80-million person market and cost ourselves more 
jobs. And if the deal is made, it could lead to further similar 
agreements with the emerging market economies of Latin America. And no 
one believes that anybody's going to invest in Argentina, for example, 
to export back to the American market. So all barrier dropping the 
further you get away from here because of transportation costs will lead 
to more jobs in America through greater trade.
    So that's why I think it makes it better, not worse. You're entitled 
to know that. I

[[Page 1990]]

don't ask you to agree, but I ask you to make the same arguments inside 
your own mind, because I would never knowingly do anything to cost 
America jobs. I'm trying to create jobs in this country.
    Now, I'll tell you what I really think. What I really believe is 
that this is become the symbol of the legitimate grievances of the 
American working people about the way they've been worked over the last 
12 years. That's what I think. And I think those grievances are 
legitimate. And I think that people are so insecure in their jobs, 
they're so uncertain that the people they work for really care about 
them, they're so uncertain about what their kids are looking at in the 
future, that people are reluctant to take any risks for change.
    And so let me close with what I started with. I have got to lay a 
foundation of personal security for the working people of this country 
and their families in order to succeed as your President, and you have 
to help me do it. We have got to reform the job training system of this 
country, to make it a reemployment system, not an unemployment system, 
and to give it to kids starting when they're in high school.
    We have got to have an investment strategy that will create jobs 
here. And that's why we removed all those export controls that were cold 
war relics on computers and supercomputers and telecommunications 
equipment, opening just this month $37 billion worth of American 
products to exports. That is important.
    That's why I want to pass a crime bill to put 50,000 more police 
officers on the street, pass the Brady bill and take those automatic 
weapons out of the hands of the teenagers that are vandalizing and 
brutalizing our children in this country. And, my fellow Americans, that 
is why we have got to pass a comprehensive health care bill to provide 
security to all Americans. And we've got to do it now.
    How many Americans do you know who lost their health insurance 
because they lost their jobs? Who never got a pay increase because of 
the rising cost of their health care? Who can never change jobs because 
they have a sick child? Millions of them. How many companies are 
represented in this room who could be selling more everywhere across the 
board, more abroad and more at home, if their health care costs were no 
greater than their competitors around the world?
    Let's face it folks, we're spending over 14 percent of our income on 
health care. Canada's at 10. Germany and Japan are under nine. The 
Germans went up toward 9 percent of their income on health care, they 
had a national outbreak of hysteria about how they were losing control 
of their health care system. And yet they all cover everybody and no one 
loses their health insurance. And when I say we can do that and we can 
do it without a broad-based tax increase, people look at me like I have 
slipped a gear. [Laughter]
    But I have spent over 3 years studying this system. And the First 
Lady and her task force have mobilized thousands of experts in the most 
intense effort to examine social reform in my lifetime. And they have 
recommended that we adopt a system which, first of all, builds on the 
system that you enjoy: an employer-based system where the employer 
contributes and, in some cases, the employee does and some not; a system 
that is focused on keeping what is good about American health care--
doctors, and nurses, and medical research and technology--and fixing 
what is wrong--not covering everybody, kicking them off after they have 
a serious illness, not letting people move their jobs, having some 
people in such tiny groups of insurance that 40 percent of their premium 
goes to profit and administrative costs, and spending a dime on the 
dollar, a dime on every dollar in a $90 billion system goes to paperwork 
that wouldn't go in any other system in the world--$90 billion a year on 
that alone. Never mind the fraud and the abuse, and the incentives in 
this system to churn it, to perform unnecessary procedures just because 
the more you do the more you earn.
    We can do better than that. So I want to just say, this system will 
be a good one. Everybody will get a health care security card like this. 
I feel like that guy in the ad. I'm supposed to say, ``Don't leave home 
without it,'' when I pull it out. [Laughter] But I want everybody to 
have a health care security card like this. Just like a Social Security 
card. And

[[Page 1991]]

I want people to have their health care access whether they're working 
or unemployed, whether they work for a little business or a big one.
    Under the system we have proposed, if you've got a better deal now, 
you can keep it. If your employer pays 100 percent of benefits now, you 
can keep it. And we don't propose to tax any benefits that are above the 
minimum package. We told those who wanted that to give us 10 years 
before we put that provision in because within 10 years we'll have the 
minimum benefit package we start with, plus full dental benefits and 
full mental-health benefits and full preventive-care benefits, so it 
will be as good or better than any package now offered by any employer 
in America. Then, if somebody wants to buy something over and above 
that, we can talk about it. But we are not going to take anything away 
from you, you have.
    What we are going to do is two things for you if you have a good 
policy. We're going to make it easier for your employer to keep these 
benefits you have now by slowing the rate of health care cost inflation, 
not by cutting health care spending, by slowing the rate of inflation in 
health care cost, and by removing the enormous burden of retiree 
benefits from our most productive companies. That will stabilize the 
health care benefits of working people and good plans.
    The other thing we're going to do for you is to limit what can be 
taken away from you which is worth something. So by saying that for 
people who don't have any insurance now, their employer will pay 80 
percent and the employees will pay 20, we are saying that no matter what 
happens to you, there's a limit to what can be taken away from you. So 
it will be easy for you to keep, easier for your employer to keep what 
you've got, and for you, and there will be a limit to what can be taken 
away.
    Is it fair to ask all those employers and employees who don't have 
any coverage now to contribute something? You bet it is. Why? Because 
your premium's higher than it otherwise would be because you're paying 
for them now.
    Can we do that without bankrupting small business? Of course, we 
can. We have a plan that gives a significant discount to smaller new 
businesses, and to smaller established businesses with lower wage 
employees that are operating on narrow margins.
    How are we going to pay for this? Two-thirds of it will be paid for 
by employers and employees contributing into the system that they get a 
free ride in now. One-sixth of it will be paid for with a cigarette tax 
and with a fee on very large companies who opt out of the system so they 
can pay for the cost of insuring the poor and the discounts to small 
business, and most important, for the health education and research that 
makes us all richer because we are going to pay for that and for 
expanded public health clinics. And one-sixth of it will come from 
slowing the rate of growth. When you hear people say, ``Oh, Clinton 
wants to cut Medicare and Medicaid, let me tell you something folks, 
we're cutting defense. We've held all domestic investment that's 
discretionary flat, which means if I want to spend more money on job 
training, on defense conversion, or on Head Start, I have to go cut 
something else dollar for dollar for the next 5 years. That's what we've 
done. We've cut defense as much as we possibly can right at the edge, 
held everything else flat.
    You know what Medicare and Medicaid are doing? They're going up at 3 
times the rate of inflation. What have I proposed to do? Let them go up 
at twice the rate of inflation. They say in Washington I can't do it. I 
don't talk to a single doctor who understands what we're going to do who 
doesn't think we can achieve those savings without hurting the quality 
of health care. If we can't get down to twice the rate of inflation from 
3 times the rate of inflation, there's something wrong somewhere.
    Now, that's how we propose to finance this. And I am pleading with 
you to help me pass this bill. No matter how good your health care plan 
is now, don't you believe for a minute you could never lose it, or at 
least get locked into your present job. And I am pleading with you to do 
it so that we can give to the rest of America, as well as to you and 
your families, the kind of personal security we have got to have to face 
the bewildering array of challenges that are out there before us.

[[Page 1992]]

    You know as well as I do that we are hurtling toward the 21st 
century into a world that none of us can fully perceive. But we have to 
imagine what we want it to be like. We want it to be a world in which 
the old rules that you grew up believing in apply in a new and more 
exciting age, in which, if you don't have job security, you at least 
have employment security; in which the Government puts the people first, 
and in which people have security in their homes, on their streets, in 
their education benefits, in their health care benefits so that they are 
capable of seizing these changes and making life richer and more 
different and more exciting than it has ever been.
    That is the great challenge before us. And if we don't adopt the 
health care reform, we won't get there. If we do, it will open the way 
to the most incredible unleashing of American energy that we have seen 
in more than a generation. Together we can do it, and I need your help.
    Thank you very much, and God bless you.

Note: The President spoke at 11:30 a.m. in the Grand Ballroom of the San 
Francisco Hilton Hotel. In his remarks, he referred to Albert Shanker, 
president, American Federation of Teachers.