Remarks on Departure for Dallas, Texas, and an Exchange With Reporters

Weekly Compilation of Presidential Documents, Oct 2, 2000

September 27, 2000

National Economy

The President. Good morning. Yesterday I announced that household income has reached an all-time high, and the poverty rate has fallen to its lowest level in 20 years. Today there's more good economic news.

Eight years ago, our future was at risk. Economic growth was low; unemployment was high; interest rates were high; the Federal debt had quadrupled in the previous 12 years. When Vice President Gore and I took office, the budget deficit was $290 billion, and it was projected this year the budget deficit would be $455 billion.

The American people, thankfully, chose a better future. They put their support behind a new economic direction of fiscal discipline, greater investment in our people, expanded trade in our products. It's given us the longest economic expansion in history and the strongest fiscal turnaround in memory. Record budget deficits have given way to record surpluses. And this has enabled us to do something that would have been impossible just years ago. We've actually begun to pay down the debt.

Today we received more good news that our strategy is working. According to the office of Management and Budget, this year's budget surplus will be at least $230 billion. With this surplus, we've been able to cut the debt over the last 3 years by this figure.

[At this point, the President wrote the number on a chart showing the deficit.]

The President. Three hundred and sixty billion dollars in debt reduction over the last 3 years.

This year alone we've cut the debt by at least $223 billion, the largest one-year debt reduction in the history of the United States. Like our Olympic athletes in Sydney, the American people are breaking all kinds of records these days. This is the first year we've balanced the budget without using the Medicare Trust Fund since Medicare was created in 1965. I think we should follow Al Gore's advice and lock those Trust Funds away for the future.

We've come a long way since then and a long way since 1993. But we can go further still. If we stay on the path we're on, we can pay this debt off entirely by 2012, for the first time since Andrew Jackson was President in 1835. Paying off the debt will benefit America, just as paying off credit cards benefits the average family. It frees up money for things that matter, and it keeps interest rates lower. That will mean more investment, more jobs, lower mortgage payments, car payments, and student loan payments. This is all terribly important.

Already the benefits of debt reduction have meant about $2,000 a year--or deficit reduction, and then debt reduction has been about $2,000 a year in lower interest payments for home mortgages, about $200 a year in lower interest payments for cars, about $200 a year for lower interest payments on college loans. And if we stay on this path, rather than go back and spend all the surplus and get back into the Social Security funds, it will keep interest rates about a point lower over the next decade. That will be worth, in home mortgages alone, over $300 billion.

So this is a very important thing to do. And I hope that we will see a continuation of this trend in this year's final end-game budget negotiations. However, the fiscal year is almost over, and Congress still has sent me only 2 of the 13 spending bills. We need to put our priorities in order and put the broad national interest above special interests.

The key to fiscal discipline, to these kinds of results, is maintaining it each year, year after year. If you look at what's happened in the last 8 years, Federal spending today as a percentage of the economy is the lowest it has been since 1966. The Federal civilian work force is the smallest it's been since 1960, down 377,000 from the day I took office.

I am concerned, frankly, about the size and last-minute nature of this year's congressional spending spree, where they seem to be loading up the spending bills with special projects for special interests but can't seem to find the time to raise the minimum wage or pass a Patients' Bill of Rights or drug benefits for our seniors through Medicare or tax cuts for long-term care, child care, or college education.

And first and foremost, they haven't found the funds for education, for continuing to hire 100,000 qualified teachers to reduce class size, to build and modernize schools, to provide after-school for children who need it, and to have real accountability for failing schools, requiring them to turn around or shut down or be put under new management.

These are the things that need to be done, and I certainly hope they will be. We can finish this year in good shape. We can maintain our fiscal discipline. We can get this country out of debt and still make the right investments and have the right kind of tax cuts, but we have to work together to do it and avoid just throwing money away simply because we're close to an election.

These results today--paying off $360 billion of the national debt, something that would have been unthinkable just a few years ago; continuing the longest economic expansion in history; knowing that we can get this done, that we can actually get the country out of debt--ought to be an inspiration for all of us to stay on the path that got us here now and in the years ahead.