[Weekly Compilation of Presidential Documents Volume 35, Number 16 (Monday, April 26, 1999)]
[Pages 683-685]
[Online from the Government Publishing Office, www.gpo.gov]

<R04>
Remarks Following a Meeting With the Economic Team

April 20, 1999

Attack in Littleton, Colorado

    Thank you very much, please be seated. Ladies and gentlemen, let me 
begin by saying that we all know there has been a terrible shooting at a 
high school in Littleton, Colorado. Because the situation, as I left to 
come out here, apparently is ongoing, I think it would be inappropriate 
for me to say anything other than I hope the American people will be 
praying for the students, the parents, and the teachers. And we'll wait 
for events to unfold, and then there'll be more to say.

Domestic and International Economy

    I have just met with my economic team to discuss the steps that we 
will be taking in the weeks and months ahead to continue to advance our 
prosperity at home and abroad. As you know, the economy continues to 
grow in ways that benefit ordinary citizens that are virtually 
unprecedented. This is happening thanks in no small measure to policies 
we instituted in 1993 to help to change America to meet the changing 
challenges of the new economy.
    We recognized that the new economy demanded fiscal discipline, so we 
balanced the budget. Now we're working to use the surpluses to 
strengthen Social Security and Medicare. The new economy requires and 
rewards greater skills, so even as we reduce

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spending in many areas, we have almost doubled the National Government's 
investment in education and training.
    In the new economy, we are linked to all the nations of the world in 
a web of commerce and communications. So we have worked to expand and to 
build--to expand trade and to build a 21st century trading and financial 
system that will benefit ordinary citizens in our country and throughout 
the world.
    The financial crisis that began in Asia in 1997 put our progress at 
risk and presented a very severe test to the global system that we have 
worked so hard to build. Though our economy has continued to grow, we 
have been affected by the Asian financial crisis, as you can see by the 
trade figures, by what has happened in steel, and by the loss of markets 
by our farmers.
    It's clear to me that we had to do something to contain the crisis, 
to restore growth, to prevent such crises from happening in the future. 
In September I went to the Council on Foreign Relations in New York and 
set out a strategy with concrete steps to speed the recovery. We joined 
with other major industrial nations to act to spur growth. Now, 7 months 
later, we see a growing number of signs that those steps have taken 
hold. Some economies once in crisis are beginning to turn the corner.
    But substantial risks and challenges remain. This is not a moment 
for complacency. It's a moment to act to prevent financial crisis from 
reaching catastrophic stages in the future.
    In a world of 24-hour markets, we will never be able to banish such 
crisis altogether, and no single proposal will solve all the problems we 
have seen over the last 2 years. But acting on the lessons we have 
learned from this experience, we can find a way to harness the benefits 
of an open global economy while taming the global cycles of boom and 
bust, just as we have found ways to moderate those swings in our own 
domestic economy. That is the central challenge we face on the financial 
front.
    Working with the other industrial nations in the G-7, we have 
already taken several important steps, from developing a new contingent 
line of credit for countries with strong economic policies to helping to 
restart the economies of Asia to limiting the fallout of the crisis in 
Latin America.
    Now, the leading industrial nations must be prepared to take the 
next steps in the design of a strong financial architecture that can be 
a platform of prosperity for all of us in the next century. We have 
worked to shape an international consensus and to develop an agenda for 
long-term reform of the global financial system.
    I know this is something that is very hard to grab headlines with, 
but if you think about what the world has been through in the last 2 
years because of the problems in the global financial system, and if you 
account for the fact that 30 percent of our growth until last year has 
come from expanded trade, it is clear that for the United States, for 
ordinary citizens in the United States, and for their counterparts 
throughout the world, there are few more important things for leaders to 
be doing than working on building a stable financial architecture for 
the new century.
    Tomorrow Secretary Rubin will outline in greater detail our 
proposals on a series of important initiatives. Starting with this 
weekend's gathering of financial officials in Washington, we will work 
to build support for these proposals among our colleagues at the summit 
of the world's leading economies in Cologne later this year. And 
eventually, we want to bring in all nations who have a stake in the 
health of the global economy.
    The emerging national economies need to be a part of this dialog, 
and all of them need to be convinced that we are trying to do things 
that will improve the lives of average working families everywhere.
    Our approach includes the following key elements:
    First, we industrial countries should take steps to reduce the 
entire financial system's vulnerability to rapid capital flows and 
excess leverage. For example, we should strengthen bank regulations so 
they actually take into account the real risks of lending.
    Second, we should continue to develop a better way to respond to 
crises, including appropriate sharing of responsibility by the private 
sector.
    Third, developing countries should take more responsibility as well, 
by strengthening

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financial regulation and bank supervision and developing sustainable 
debt management policies, thus avoiding excessive reliance on short-term 
debt. We will seek to reinforce these policies through the actions of 
the international financial institutions.
    Fourth, the international financial institutions should focus their 
efforts on encouraging developing countries to adopt sustainable 
exchange rate regimes and the macroeconomic policies necessary to 
support them.
    Fifth, we must ensure that the most vulnerable citizens do not bear 
the brunt of these crises. That means the IMF and the World Bank must 
pay more attention to social safety nets, working with countries to lay 
strong foundations during good times and to maintain adequate 
protections during bad times. In moments of crisis, budgets for core 
social programs should be preserved or at least should not bear the full 
brunt of necessary cuts.
    Sixth, we must remember that the poorest countries, nations that 
private capital flows are bypassing altogether, need help because they 
are burdened with unsustainable levels of debt. Last month I asked the 
international community to take actions to forgive $70 billion in global 
debt, at a meeting we had here with representatives of over 45 African 
countries. No nation committed to good governments and economic reform 
should be crushed by a debt burden that it is so heavy it will punish 
ordinary citizens and prevent growth, no matter what people do.
    Now, if we take these steps, we can build an international 
marketplace that reflects our values. And we can achieve something that 
I think people in the United States want very badly: We can put a human 
face on the global economy. We can show people, here and around the 
world, that there won't just be economic numbers showing growth, but 
their lives will be actually improved by the work we do to draw closer 
together.
    Thank you very much.

Note: The President spoke at 4:34 p.m. in the Roosevelt Room at the 
White House.