Interview with Ron Insana of CNBC's "Business Center" in Clarksdale, Mississippi

Weekly Compilation of Presidential Documents, July 12, 1999

Now, in 1997, we reached agreement on a bipartisan balanced budget deal which kept that philosophy going. We continued to invest in education and technology and research. We provided tax cuts to families and for college education. We did it in a balanced way, and what's happened? Now we've got this surplus.

I will say this: The most important thing we can do for the long-term health of the economy is to say to the whole world, we're going to make America debt-free in 15 years. If we did that, what does that mean? Much lower interest rates, higher business investment, lower credit card, lower consumer, low homeownership rates, higher wages.

So will we negotiate? Will there be a negotiation? Of course there will be. But let's do the first things first. Let's keep America economically strong. We've got 6 1/2 years of evidence now about what works. Why in the world would we take a U-turn and run this deficit back up or just pull out of the education business?

Mr. Insana. Let me ask the question more simply than the way maybe an individual might, which is, if I overpay my taxes every year, I get a refund; if I overpay for 15 years, why can't I get a really big refund and get that money back in the way of a tax cut?

The President. Well, how do you define "overpay"?

Mr. Insana. Well, if you're running a surplus, I mean, Government has more money than it can use.

The President. That's right. But Government has more money than they can use for 15 years after quadrupling the debt in the 12 years of the Reagan-Bush years. I mean, we tried it their way. We tried it their way. We tried all the supply-side economics. Every year - very year - they came in and said, "Oh, we're going to get rid of the deficit this year." And every year, it got bigger and bigger and bigger. You go back and look at what they said, my predecessors said, was going to happen to the budget and what, in fact, had.

You know, sooner or later, results should account for something. Sooner or later, we should stop having this debate as if there is no history, no evidence, no facts, no results. Now, we've produced an economy with 19 million new jobs, the longest peacetime expansion in history, and if we get out of debt, the average person will get much more than they would from an extra tax cut.

Second, I am for a sizable tax cut. I have proposed a sizable tax cut. I also supported the previous tax cuts, the $500 child credit, the college credit which is $1,500 a year. I supported all these tax cuts. But first things first. If we take this country out of debt for the first time since 1835, then average people are going to have more money in their pockets than if we keep the country in debt and give them a tax cut now because we've got an election in a year and a half.

Stock Market and the National Economy

Mr. Insana. Can I stick in one final question? As we speak right now, the stock market again is at a new all-time high - the Dow, the Nasdaq - everything's going very well on Wall Street. Do you worry at all about a bubble in the stock market or the economy today?