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 Clinton Announces Budget Surplus Projection of $39 Billion For This Year (5-26-97)



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Transcript Of Clinton's Remarks On Projected Budget Surplus

May 26, 1998

PRESIDENT CLINTON: Thank you very much.

Thank you, Jack, and let me thank the other members of the economic team.

This is, of course, very good news for the American people, as the chart shows. Now it's official that his year, well ahead of the most ambitious schedule, America has balanced the budget.

In fact, as the chart shows, the achievement of the American people will not stop there. OMB predicts that he budget surplus will be $39 billion, the largest dollar surplus in our history, the largest surplus as a share of the economy in more than 40 years.

America can now turn off the deficit clock and plug in the surplus clock.

Given the speed with which our nation has reached this remarkable milestone, it is perhaps all too easy to forget how hard it was and how far we've come.

Just six yeas ago, because of the drag of deficits, our people were running in place, our nation was falling behind. Interest rates were high and so was unemployment. On the day I took office, the deficit was projected this year to be $350 billion.

How did this greatest projected deficit in history turn into the greatest projected surplus? The old fashioned way. We earned it.

Our nation earned it as a result of hard work by the American people. And as the vice president said, we earned it here in Washington with the help of two visionary actions in Congress -- first, the courageous vote by the Democrats in 1993 in the midst of withering extreme criticism that led to a cut in the deficit of 90 percent, and then the truly historic bipartisan balanced budget agreement passed by Congress last year that finished the job.

I think it would also be wrong if I didn't mention, as Mr. Lew did, that the Reinventing Government efforts headed by the vice president played a major role.

We not only have the smallest government since the Kennedy administration, with more than 300,000 fewer people. We also have savings in excess of $130 billion during the budget period as a result of those efforts. And Mr. Vice President, I am very grateful for what you have done.

Now that we're about to have the first surplus since Neil Armstrong walked on the moon, we face a crucial decision about what to do with it. We can use these good times to honor those who've put in a lifetime of work and prepare for the future retirement of the baby boomers by saving the Social Security system for generations to come. Or we can give into the temptation in this election year to squander our surpluses the moment they start coming in.

I think the choice is clear. We got to where we are today -- with 4.3 percent unemployment, more than 15 million new jobs, the lowest inflation in over 30 years, low interest rates, high growth, the highest home ownership in history -- by doing what was right for the American economy over the long run. That is what we should do now.

Social Security has been a cornerstone of our society for the last six decades, but the present system is not sustainable as we look forward to the full retirement of the baby boom generation. We have to protect it for the 21st century.

I was deeply heartened after I spoke about this at the State of the Union, that there were broad public statements of support from the leaders of both parties in both houses in Congress about saving Social Security first.

However, in recent weeks, senior Republican leaders in the House of Representatives seem to have retreated from that pledge.

In this election year, some now want to raid the surplus for initiatives instead of preserving every penny of the surplus until we strengthen Social Security.

We cannot ignore the long-term challenge, which we have a unique opportunity and responsibility to meet now, in favor of short-term schemes that however popular in the moment could compromise our future.

Let me clear: I will oppose any budget that fails to set aside the surpluses until we have strengthened Social Security for the 21st century.

Let me also be clear that does not mean that in the future there could never be a tax cut. It simply means that we need to know how we're going to pay for the challenges of reforming Social Security.

Once we know that -- and we should know that sometime next year; I would hope early next year, because of the work being done this year -- then we can have a debate about what ought to be done if there are funds that still are unaccounted for and unobligated.

Today our economy is the envy of the world. But the progress was not predestined nor is its future guaranteed.

We cannot abandon the strategy of fiscal discipline and investments in the future, which has brought us to this moment.

Instead, we should work together, across party lines, to maintain fiscal responsibility, to save Social Security first, to prepare for an even brighter future.

Again, let me thank the members of the economic team, those who are here and those who preceded them, for their work in this remarkable effort and every member of Congress whose votes have contributed to it.

Thank you very much.

QUESTION: Over the weekend, those same Republican leaders -- I defer to Sarah (ph).

QUESTION: (OFF-MIKE)

CLINTON: Well, let me say we are very concerned about that, Sarah (ph). And I asked John Koskinen -- formerly a deputy at OMB, and before that, a man who had a very distinguished career in the private sector -- to come back into public service to supervise and coordinate our efforts to deal with the computer 2000 problem.

It's not something that grabs the headlines every day, but it is, in fact, a profound challenge -- not only for the United States, but for every country that, which is every country now, that has extensive reliance on computers. And there are a lot of very complex questions.

There are computer hookups where people at both ends have computers that are -- can be programmed to move easily to 2000, but there is something in the connection in between which won't.

So this is a very complicated problem. Interestingly enough, we discussed it in some detail at the G-8 meeting in England recently.

And I can tell you that we are working very hard on it. We're working very hard, first of all, to monitor the progress of every government agency to see that they are ready. And some are doing better than others because some have more profound challenges than others. And secondly, we want to do what we can to be supportive of the private sector in the United States in their efforts to make these adjustments.

But it is a very big problem. And I would urge -- since you've asked the question -- I would urge everyone in America who hears this exchange to make sure that they have done everything they can do within their own business sectors to be ready for this.

And we also agreed, by the way, when I was in England, to work with other countries so that we can help share information, and do everything we can to make sure that when the new millennium starts, it's a happy event and not a cyberspace headache.

QUESTION: Mr. President, over the weekend Republican leaders called on you to postpone your trip to China, or at the very least, not have a welcoming ceremony in Tiananmen Square. What will you do, sir?

CLINTON: Well, I think it would be a mistake to postpone the trip to China.

Our partnership with China has succeeded in persuading the Chinese not to transfer missile technology and other dangerous materials to nations that we believe should not have them. We have seen some advances on the human and political rights fronts recently. We have worked closely with them and North Korea.

Today, we are working with them to try to diffuse the tension and prevent a new nuclear race in South Asia.

So I think we have a broad range of issues to deal with, and I think we have enough evidence now to justify the partnership that we've had. So, I believe we ought to go forward.

END

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