Remarks to a Joint Session of the Arkansas State Legislature in Little Rock, Arkansas

Weekly Compilation of Presidential Documents, Jan 22, 2001

That's why we passed the empowerment zone program that Vice President Gore ran for 8 years, and did a brilliant job, I think, where we had these zones. But I thought we ought to do something to try to essentially make every area in America that was insufficiently developed eligible for the same investment incentives that we presently give American investors to invest in poor communities in Africa or Latin America or poor countries in Asia.

That's essentially what this new markets legislation is all about. We did it in partnership with the Speaker of the House, Dennis Hastert, a Republican from Illinois, and I'm very grateful to him for the work we did together, and any number of other legislators who are active in it--J.C. Watts from Oklahoma, a lot of you know; Danny Davis, from Illinois, who is from Arkansas, the Congressman from Chicago.

So I hope that you and, Governor, the economic development agencies of the State, will look for ways to maximize the usage of this new markets legislation, because, essentially, we've got one more piece that I think will pass early in this new session of Congress, but what we're trying to do is to give people the incentives to put money into places of high unemployment, where people are willing to work, and to spread the risk.

So essentially, what it does, it sets up the system where you can get about a 25 percent tax credit for investing in areas with very high unemployment, which means your risk is only 75 percent of what it would otherwise be, and if you have to borrow money, that up to two-thirds of an investment could be guaranteed by a Government mechanism, which would give you about 2 percent lower interest rates, which would further reduce the risk, which is essentially what we do when we try to set up trade and investment agreements all around the world in developing countries, where we have an interest in building the trading partners for the future and heaping democracy. I could never understand why we wouldn't do it for people here in America. And I believe we have a unique opportunity here to bring free enterprise to people who have been left behind.

I know Arkansas is small enough, you all know each other well enough, you've had enough experience with this, we went through all that nightmare of the eighties, that it seems to me that this State is in a position maybe to take more advantage of that, and also to identify what still needs to be done, what the National Government can do, than any place else.

I should also tell you that we're now going to have 40 of the empowerment zones that we had--not that many, but we had 20 to 30--and we're going to have 40 other communities, enterprise communities, designed by the Republican Members of Congress. We said, "Look, why don't we just test this? You guys design 40 communities that will get the special tax treatment the way you want it. We'll have 40 that work the way we think would work best. We'll identify 80 places that will get extra help. And then we'll just see what works, and then we'll do what works. If your idea works better than ours, we'll do yours. If ours works better, we'll do ours. And if some of each works best, we'll do that."