[Weekly Compilation of Presidential Documents Volume 35, Number 4 (Monday, February 1, 1999)]
[Pages 115-116]
[Online from the Government Publishing Office, www.gpo.gov]

<R04>
The President's Radio Address

January 23, 1999

    Good morning. Last Tuesday night, in my State of the Union Address, 
I was honored to report to the American people that our families, our 
communities, and our country are stronger, healthier, and more 
prosperous

[[Page 116]]

than ever. But I warned that we cannot let the hum of our prosperity 
lull us into complacency. Instead, we must use this moment of promise to 
meet the long-term challenges we face as a nation, to meet our historic 
responsibility to the 21st century.
    Over the last 6 years, our hard-won fiscal discipline has given us 
the chance to meet those long-term challenges. Six years ago our budget 
deficit was $290 billion. Last year we had a budget surplus of $70 
billion. We expect another one a little larger than that this year, and 
we're on course for budget surpluses for the next 25 years.
    So now we face a new choice: what to do with the surplus. I believe 
we should use it to plan and save for retirement, to strengthen the 
readiness of our military, to get our children ready for the 21st 
century. Very simply, I believe we should use the first surplus in three 
decades and the projected ones in the future to meet America's great 
challenges. Above all, that means saving Social Security and Medicare.
    We all know that the baby boom will soon become a senior boom. The 
number of seniors will double by 2030; average life expectancy is rising 
rapidly, and that means rising costs for Social Security and Medicare.
    I propose to keep Social Security strong for 55 years by committing 
60 percent of the surplus for the next 15 years and investing a small 
portion in the private sector just as any private or State pension would 
do. We should make further tough choices to put Social Security on a 
sound footing for the next 75 years, to lift the limits on what seniors 
on Social Security can earn, and to provide support to reduce the 
poverty rate among elderly women--which is twice the poverty rate among 
seniors as a whole. We can do that with a good bipartisan effort.
    Once we've accomplished this, I propose we use one of every six 
dollars of the surplus over the next 15 years to double the life of the 
Medicare Trust Fund. Then I believe we should dedicate $500 billion of 
the surplus to give working families tax relief for retirement savings, 
by creating new Universal Savings Accounts--USA accounts--to help all 
Americans build a nest egg for their retirement.
    Under my plan, families will receive a tax credit to contribute to 
their USA account and an additional tax credit to match a portion of 
their savings--with a choice in how they invest the funds--and more help 
for those who will have the hardest time saving.
    Let me give you an example of how USA accounts could work. With the 
help of USA account tax credits, working people who save and invest 
wisely from the time they enter the work force until the time they 
retire could have more than $100,000 in their USA account, and a more 
secure retirement. That's the kind of tax relief America needs. By 
providing this new tax credit for retirement savings, we can make it 
possible for all Americans to have a stake in the remarkable economic 
growth they have worked so hard to create.
    Social Security first, then saving Medicare and giving tax relief to 
help all Americans save in the new USA accounts, investing in defense 
and education: that's the right way to use America's surplus. If we 
squander the surplus, we'll waste a once-in-a-lifetime opportunity to 
build a stronger nation for our children and our grandchildren. Instead, 
let's work together to prepare our Nation for the great challenges and 
opportunities of the 21st century.
    Thanks for listening.

Note: The address was recorded at 3 p.m. on January 22 in the Roosevelt 
Room at the White House for broadcast at 10:06 a.m. on January 23. The 
transcript was made available by the Office of the Press Secretary on 
January 22 but was embargoed for release until the broadcast.