[Weekly Compilation of Presidential Documents Volume 35, Number 8 (Monday, March 1, 1999)]
[Pages 302-309]
[Online from the Government Publishing Office, www.gpo.gov]
<R04>
Remarks to the Community in Tucson, Arizona
February 25, 1999
The President. Thank you. Thank you. I was just wondering if Esther
would agree to go back to Washington with me. That was amazing.
[Laughter]
Thank you for your wonderful welcome. I had no idea when I got here
that I was coming to a place so large or so beautiful or completely
full, with a good crowd outside. And it's a real testament to your good
citizenship. You can't imagine, as Congressman Kolbe said, what this
weather look like to us. It has been freezing in Washington. And I come
here, and I'm sort of a sports fan--you've got three teams in spring
training; you've got this great golf tournament going on here. And here
you are with me. Thank you very much. I'm very grateful.
I'd like to thank Mayor Miller for meeting me at the airport and
being here today. And he and his wife met me, and it's her birthday
today--I hope she's enjoying this unusual celebration of her birthday.
I thank County Supervisor Sharon Bronson for her remarks and her
presence here today. And Congressman Kolbe, thank you for crossing
district and party lines to be here with us today. We appreciate it very
much. I thank you good friend, Ed Pastor, and his wife, Verma, for their
friendship and support and leadership over the years. I thank him for
that.
I know Attorney General Janet Napolitano and several legislators and
tribal leaders and others are here. I thank them for being here. I think
the Director of the Pima County Council on Aging, Marian Lupu is here. I
[[Page 303]]
was told before I got here that Linda Ronstadt and CeCe Peniston are
here, and if they are, thank you for being here. And if they're not, I'm
giving them free publicity. That's okay, too. [Laughter]
You know, I'm delighted to be back in Arizona; I'm delighted to be
here. Ed told me that I am the first President to come to Tucson since
President Ford. If that's true, the others didn't know what they were
missing, I can tell you that. I'm not sure, but I believe this is the
first time I've had the opportunity in Arizona to thank the people of
Arizona for their support for the Vice President and me in 1996, and I'm
very grateful for that.
This State is living proof that the great era of westward expansion
did not end a century ago; it is still going on. And when I look out
here at all of you, I am reminded that when America looks to the west,
it still sees the future. We see in Arizona the glimpses of America's
future, and the seismic shifts in population, and growth you are already
undergoing.
The mayor mentioned Hillary--the one thing--I wanted to say this:
the one thing Hillary said to me this morning, only half kidding, before
I left--I said, ``You know, look at this. This speech begins by saying,
Arizona is the mirror of the future, all these shifts in population.''
She said, ``Yeah, there's another way it's a mirror of the future, too.
The women are in charge at last.'' I think my political career just got
in there under the wire. That's what I think. [Laughter]
Let me say to all of you, we've had a good time today, and I am
delighted to be here. But I do want to take a few moments to have a
serious discussion with you about what I believe we should be doing in
this last year of the 20th century. And I think it is terribly
important, because the United States is so fortunate today to have the
longest peacetime expansion in our history and the lowest peacetime
unemployment since 1957 and all the other economic indicators you know
well. We're in our second year of budget surpluses after 30 years of
deficits. Welfare rolls are about half what they were 6 years ago. We
are so fortunate.
But the tendency is for people in public life and positions of
responsibility and for citizens at large, after having gone through
difficult and challenging times, when things get a whole lot better and
ordinary folks can finally begin to feel it, to see it in the highest
homeownership in our history, for example, the tendency is to say, whew,
and to relax, and to basically just enjoy this moment or to think about
other things, or to get distracted. And I believe that would be an
error.
And I ask you to come here today to join with me in thinking
seriously about our future, because this prosperity we have and this
confidence we have gives us not only an opportunity but an obligation to
try to deal with the long-term challenges America faces. That's what I
attempted to talk to the American people about in the State of the
Union. I want to mention a few of them today and then focus on the ones
that have already been discussed.
There's one other person, though, I will not forgive myself if I
don't introduce, a native of Arizona and a very important member of my
personal White House staff, Mr. Fred DuVal. So I wanted to introduce
Fred. Thank you very much.
One of the big challenges you face in Arizona that all America will
have to face is, how do we preserve the environment as we grow the
economy; how do we maintain what you all came to California--I mean, to
Arizona--for in the first place? [Laughter] While you have sustained
records--economic growth. If you moved here to Arizona, if you're not
like Esther and you weren't born here, if you moved here, it puts you in
an awkward position to say you wish other people would stay home,
doesn't it? So the question is, how do we sustain growth as a country,
knowing we're going to put more pressure on our natural resources, and
knowing we have local problems like preservation of green space, other
natural heritage, quality of water, quality of air, not having toxic
sites, and that's all somehow connected to a lot of global problems like
the warming of the climate.
This is a major challenge. I know that you are working on it. When
the mayor met me at the airport he gave me a shirt that I'm going to try
to wear out to spring training when I leave you--on the Bellota Ranch,
which you have preserved, I think 10 or 12
[[Page 304]]
miles from here--the kind of thing we ought to be doing more of.
And so one example of what we're trying to do to help you deal with
the future is the livability agenda that I talked about a little bit in
the State of the Union, that the Vice President and I developed, that
will give communities new tools and new resources to deal with whatever
the major challenge is in any community to making it more livable,
whether it's reducing traffic congestion or saving green space or
promoting smart growth.
We also have to recognize that we're not yet giving all of our
children a world-class education, so in the State of the Union I talked
a lot about how we can build a 21st century education for every American
child, from putting more teachers in the schools to building or
modernizing 6,000 schools, to having more summer school and after-school
programs, to having more charter schools and Internet hookups for all of
our classrooms. These things are very important. And Arizona has growth
challenges and diversity challenges there as well.
We talked a lot about--in the State of the Union, I talked a lot
about the need to bring economic opportunity to the communities and the
people that still haven't been part of the recovery, whether they're in
urban areas or isolated rural areas or Native American reservations. We
have a program now--if we can't get investment in there now when
unemployment is low and when money is ample, if we can't get private
investment to prove free enterprise will work for all Americans who will
work, we'll never get around to doing that. So I think that is a very
important thing for us to do now, and I hope you will support that.
But for the next few years, all of these major challenges will be
overshadowed by two great decisions: how do we deal with the aging of
America; and what are we going to do, now that we finally have a budget
surplus, what are we going to do with it? And I want you to think about
that.
You know you are on the cutting edge of the aging of America. Here
in Pima County alone, there are an enormous number of people over 65;
the number has doubled just since 1980. The number of Americans over 65
in the entire country will double within 30 years. Life expectancy is
already 76 years-plus in America. If you get to be 65 years old, your
life expectancy, on average, is already over 80, well over 80. People
over 80 are the fastest growing group of Americans. Esther's just one of
the crowd there--[laughter]--and her family.
So what does all that mean? Well, it means that before you know it,
there will only be two people working for every one person drawing
Social Security. It means even before that, there will be many, many
more people on Medicare, and the older you get, the more you tend to
access health services. And even staying healthy often costs money.
If you look at that, when the baby boomers retire--we had to wait
two generations. It's not until--this group that's now in the schools
today is the only group of Americans more numerous than the baby boom
generation. I'm the oldest of the baby boomers, I was born in 1946----
Audience member. Me, too. [Laughter]
The President. It looks better on you. [Laughter]
And those of us in the next 18 years are the so-called baby boom
generation--we retire, there will be two people drawing--working for
every one person drawing Social Security. And even before that, as I
said, there will be great pressures put on the Medicare program because
we're living longer, and we have more access to high-tech medicine, but
we access it more.
Another thing that's important for you to remember is that Social
Security is not just a retirement program; it's an insurance program.
One-third of the investments that are paid out in Social Security go to
people who become disabled or to the survivors of people who die
prematurely from accidents, disease, and other things. And when you
think about what you're getting out of Social Security, particularly if
you're not drawing it yet, don't forget that every year--you have the
equivalent of a term insurance policy that's issued every year against
disability or death.
All over America, I meet people who literally would not be able to
get along were it not for these benefits. So here's the problem:
Everybody likes Social Security; everybody likes Medicare; and we can't
sustain the
[[Page 305]]
programs unless we make some changes, both changes in the structure of
the program and investing more money.
Now, thank goodness we now have a surplus. We're in the second year
of surpluses, and we project that, on average, we'll have them for at
least another 25 years. That doesn't mean that we won't have bad
economic years, but on average, year-in and year-out, we'll have them,
and that's good.
Now, in the State of the Union Address, as Esther said, I proposed
setting aside for 15 years 62 percent of the surplus for Social Security
and 15 percent of it for Medicare. And I'd like to talk a little about
that. I propose to do it in a way that will enable us to pay down the
national debt with the surpluses but as we pay the debt down, to commit
the money that we're using to pay the debt down when it comes back in,
when it's manifested in the out-years, to commit future years money to
Social Security and Medicare.
Now, if we do that, every young person in the audience should be for
that, not just because it would guarantee that you would get Social
Security and Medicare but because if you pay the debt down, as I'll say
more about in a minute, it will immeasurably strengthen the American
economy. And keep in mind, it is the strength of our economy that is
enabling us to have this whole conversation today. If we still had 8
percent unemployment and a $200 billion deficit, we'd be letting
somebody else think about this down the road.
Now, I want to say, first of all, that I am very encouraged that
there are more and more Members of Congress like the two here, Ed Pastor
and Jim Kolbe, who are committed to seeking reasonable solutions to
these challenges, and who want to set aside--there seems now to be broad
agreement among leaders and rank-and-file members in both parties of
Congress to set aside the lion's share of the surplus to save Social
Security.
There seems to be, now, some movement in the Republican majority
away from having a large across-the-board tax cut if it would take away
from the surplus' ability to save Social Security. We don't yet have
that kind of agreement on setting aside some of the surplus for
Medicare, and I think we should. And I'm going to keep pushing for that,
because I think it's important--and I'll explain more about that in a
moment--because I think we have to have both Social Security and
Medicare fixed by the end of this year.
Now, I can tell you--if you look at what this surplus is projected
to be over the next 15 years, if we did what I asked there would still
be a substantial amount of money, out of which you could have targeted
tax cuts, which I think the best are the USA accounts, the savings
accounts I proposed, because most people need help saving for their
retirement. But you could have a targeted tax cut. You could have
investments for defense, for education, for medical research. There's
still money there.
But keep in mind: when you save money, if it doesn't materialize,
you just didn't save quite as much as you meant to. Once you give the
tax cut, the money is gone. So we're giving it back to you, and it was
all your money in the first place. And that's good. But if you want us
to fix Social Security and Medicare, you should want us to make sure
that we invest enough to do that. And if we do it--[applause]--thank
you.
Now, let me just tell you basically what I propose to do. What I
propose to do is to take 62 percent of the surplus, commit it to Social
Security, and pay the debt down. And what I believe we should do is to
invest a modest amount of this in the private sector, the way every
other retirement plan does. The Arizona State retirement plan does;
every municipal retirement plan does; every private plan does. But I
don't want to see the Government having too much influence over the
stock market, so I proposed to set up a totally independent board, like
every other retirement plan has, that no politician can have any
influence over, and then to limit the aggregate amount of our
investments to about 4 percent. It will never get over 4 percent over
the next 20 years.
There's some differences about that, but if you do it, you'll
increase the rate of return on Social Security. When only two people
work and one person draws, you have to find some way to do it. Mr. Kolbe
got a different way he thinks is better.
But here the point I want to make: If you set aside 62 percent of
the Trust Fund for Social Security, it will extend the life of the
[[Page 306]]
Social Security Trust Fund to 2050, maybe another year or two, depending
on how much longer the economy stays in good shape.
But there are three other things we need to do, and I want you to
think about it. Number one, historically, to have a good retirement
system with Social Security, we've always thought we ought to have it
alive for 75 years. Number two, the rate of poverty among single elderly
women is over 18 percent, nearly twice the general rate of poverty among
seniors, and we need to make some adjustments in the program to lift
them out of poverty, I think. Number three, I think it's a mistake, when
more and more seniors are living longer and living healthier, to
continue the earnings limitation on Social Security, that limits what
people can earn. And interestingly enough, if you lift the earnings
limitation, it actually costs the Trust Fund money in the short run
because a lot of people start collecting their Social Security. But
within a matter of a few years, it starts making money, because even
retired people who earn income pay taxes on it, so after a certain
period it will actually start replenishing the Social Security Trust
Fund.
Now, to do that, to do that we will have to make some other changes.
And to do that, we will have to make some changes that will be perhaps
somewhat controversial, that will have to be made in a bipartisan
fashion. But the changes won't be nearly as dramatic, nearly as big and
nearly as troublesome as they would be if we didn't commit the surplus
in the first place.
So I hope that you will support this idea of committing the surplus
and then you will tell--we're down in Ed's district now--tell him that
you know he wants to preserve Social Security; you know he wants to take
care of the people that have to be taken care of; and you will trust him
to go up there and make some decisions that may be somewhat
controversial today; but 10 or 20 years from now we'll all be thanking
goodness that the Congress of the United States was willing to do what
it takes to save Social Security for 75 years. And I think that's
important.
Now, let me say furthermore, on Medicare, here's the problem. We've
made a lot of changes in Medicare to try to cut down on fraud and abuse,
and there was a bunch of it. Right now, the Trust Fund in Medicare is
stable for 10 years; that's the good new. Here's the bad news. Ten years
is not enough. We ought to stabilize it for 20 years. And as probably
most of you have noticed, inflation in the cost of health care has gone
way down the last few years. Health insurance premiums have not been
going up very fast. We've got them back in line with inflation.
When I became President, for many years before that, health
insurance premiums had been going up at 3 times the rate of inflation.
But a lot of the savings, the easy savings that could be squeezed out
for managed care--and some not so easy, which is why I'm for the
Patients' Bill of Rights--a lot of those savings have been squeezed out.
So this year, it is estimated that health insurance premium costs will
increase about 7 percent, whereas the general rate of inflation will be
just a little over 2 percent.
So you can see that that's a real problem. We can't sustain the
present budgeted costs of Medicare. We're going to have to put some more
money in it. If we put 15 percent of the surplus aside for Medicare for
20 years--15 years, we could take the Trust Fund out from 2010 to 2020.
Now, I would also like to see us begin to work into Medicare a
prescription drug benefit, which I think would dramatically improve it.
But keep in mind, the program doesn't have enough money now. We've got
to be careful how we do it because you could spend a whole lot of money
in a hurry and give people who may not need it the benefit. But if you
think about it, we're spending--we've had a remarkable bipartisan
consensus. You know, you wouldn't think we ever agreed on anything, I'm
sure, out here. [Laughter] Once in a great while we all agree on
something. And one of the things that we've had real agreement on every
since I've been in Washington, for the last 6 years, has been to
dramatically increase spending for medical research. And some of the
findings are breathtaking.
We've uncovered the genes that give a strong predisposition to
breast cancer. We've done nerve transplantations in laboratory animals
from legs to spines that have actually
[[Page 307]]
cured broken spinal cords in laboratory animals, just unbelievable
things that have breathtaking potential for the future. But if we're
investing all this money to try to come up with medicine, for example,
that helps to keep people well or to cure conditions that were formerly
incurable, that dramatically improve the quality of life, we want to be
able to bring those into the lives of the American people.
And if you're worried about people, in effect, as we get older
putting enormous burdens on the hospital costs, which is all the money
is--you know, hospital and doctor visits--if we can work out the right
sort of prescription drug benefit, we'll actually save money over the
long run because people will stay out of the hospital, they'll stay out
of costly medical care, they will stay healthy. So we have to work hard
to kind of get this right.
So again, my proposal is, set aside 15 percent of the surplus for
Medicare, take the Trust Fund out to 2020, but recognize we're going to
have to make some changes there for the same reason we have to make some
changes in Social Security, and especially if we want to add a
prescription drug benefit for the people who really need it.
Now, that's the general outline of my proposal. But I also want to
emphasize, if you save the surplus for 15 years--we save a little over
three-quarters of this surplus for 15 years and used it to buy into
publicly held debt and to pledge the future revenues to Social Security
and Medicare, here's what would happen. We would go from a national debt
that today was quadrupled between 1981 and 1993--we quadrupled the debt,
and it was 50 percent of our annual income--today it's down to 44
percent of our annual income. In 15 years, it will be down to 7 percent
of our annual income. The last time it was 7 percent of our annual
income was 1917, right before we went into World War I.
What does that mean to you in practical terms? This is where I want
the young people in the audience to listen. It will mean that the
Congress that meets 15 years from now, instead of having to take a 13-
plus-cents of every dollar you pay in taxes right off the top to pay
interest on the debt, we'll be spending 2 cents of every dollar you pay
in taxes to pay interest on the debt.
In the early years, most of the difference will go to fix Social
Security and Medicare. But over time, that's a huge amount of money that
can be invested in the needs of future generations. It can be providing
for tax cuts; it can be providing for anything out in the country when
we get this debt off.
But what I want the young people to understand here, especially is
if we start paying this debt down and we go all the way, if we stay on
this trajectory we could be debt-free for the first time in 2018. That's
just 19 years from now. And in the meanwhile we'll have lower interest
rates, higher investment, more investment in new business and new jobs,
home mortgage rates will be lower, credit card payments will be lower,
car payments will be lower, student loan rates will be lower, and the
economy will grow faster. Now, I want you to think about it. Why will
that happen? Because the Government will not be going in and taking up a
bunch of money every year to finance the deficit. So interest rates will
go down, savings will go up, investment in our future will go up.
So this proposal is good for younger people for two reasons: This is
not--for one thing, people on Social Security now don't have to worry,
it's going to be fine for 30 years. You don't have to worry. Now, you
do, most of you on Medicare, have to worry because it's not going to be
fine after 10 years if we don't fix that.
But every American of every age should care about this. Why? Well,
for one thing, I can tell you as the oldest of the baby boomers, I spend
a lot of time--I stay in touch with the people I grew up with, a lot of
them. Most of them are just middle-class people, the kind of people who
live here in Tucson. And my whole generation is obsessed with the
thought that our retirement, because we're such a large group, would put
an unacceptable burden on our children and their ability to educate and
raise our grandchildren. And if we fix Social Security and Medicare,
then our children will have more of their disposable income in those
years to build their families, their quality of life, and their
children's future. That's why this is not just a seniors' issue.
[[Page 308]]
Secondly, if we pay down the debt, the major beneficiaries of those
changes will be the younger people. You know, there's been a lot of
trouble in the world economy the last couple of years. Last year it was
terrible. I have worked very hard to try to turn it around. I will do
everything I can this year to make some major strides forward, because a
lot of our prosperity depends upon the prosperity of our trading
partners. But our ability to control what happens beyond our borders is
somewhat limited, as all of you understand. I can tell you this: If we
pay this debt down, whatever bad times come in the future won't be as
bad as they would have been by a long shot. And whatever good times come
in the future will be much better than they would have been because of
this.
So I say again, I haven't tried to give you a traditional political
speech today; we're just having a talk. And I appreciate how--I very
much appreciate how quiet you've been and how you've listened to this.
There are some promising signs in Washington. I met with the leaders
of both parties in both Houses, a couple of days ago. There's some
indication that there is--I think there is an agreement that we have to
use the lion's share of the surplus to save Social Security. There is, I
think, some movement toward reaching some consensus about the nature of
tax cuts, if they ought to be targeted and benefit the people that need
it most and try to not get in the way of saving Social Security. We're
not there on Medicare yet, and the Medicare problem will come sooner.
But we need to hear--the people of this country need to make a
decision. And this is maybe a fairly complicated scenario I've laid out
for you. I know it would be a lot more popular to say, ``We've got a
surplus. It's your money. I'm just going to give it back to you.'' And
then you could all cheer; and I could go home; we'd go watch baseball or
do something else. [Laughter]
But what I want to say to you is, this is a high-class problem. This
is nothing to wring your hands about. The reason we have this Social
Security and Medicare problem is because we've got the best medical
science in the world and because we're all living longer. This is not an
occasion for hand-wringing. The older I get, the better I like this
problem. [Laughter] This is a high-class problem.
But we have a responsibility to the future. This country's still
around here, after more than 200 years, because whenever the chips are
down and we had to make a decision about what kind of country we were
going to be and what kind of future we were going to have, we did the
right thing. And we kept going forward.
And the decisions that we make, not just in the Congress and the
White House, but as a people, about whether we're willing to take on the
challenge of securing Social Security for the 21st century, whether
we're willing to do the same thing for Medicare, and whether we're
willing to save a substantial part of this surplus to do those things
and to pay this debt down, will shape, in large measure, what America is
like for the young people in this audience and their counterparts
throughout the United States.
This is a wonderful time to be in the United States. We can all be
grateful, because the truth is that no one, not even the President,
could have predicted that the results of our attempts to reduce the
deficit, to bring interest rates down, would have produced these
results. And no one can claim sole credit for it. This is a shared
achievement of the American people. And we should be proud of it.
So as we go back to Washington and we go back to work, I ask you
here--and I ask you to talk to your friends and neighbors in Arizona--
when you're on your phone with your friends and family members
throughout the country, I want you to tell them about this meeting
today. And if you don't remember anything else, just remember, if we
save about three-quarters of this surplus for Medicare and Social
Security and if we pay the debt down with the surplus and then if we
have the courage to make some decisions that may sound a little tough--
to save Social Security for 75 years, fix Medicare for 20 years, and get
the debt down to where it's virtually nonexistent--America is going to
be a stronger, better place.
These programs will be there. These programs will be there for the
next generation of Americans, but America will be there--
[[Page 309]]
America will be there--brighter, better, stronger than ever before.
Thank you, and God bless you.
Note: The President spoke at 12:35 p.m. in the Music Hall at the Tucson
Convention Center. In his remarks, he referred to senior citizen Esther
Don Tang, who introduced the President; Mayor George Miller and his
wife, Roslyn; Verma Pastor, wife of Representative Ed Pastor; and
entertainers Linda Ronstadt and CeCe Peniston.