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Office of the Press Secretary

For Immediate Release October 27, 1995


The West Lobby

11:00 A.M. EDT

Q (inaudible) -- growth figures?

THE PRESIDENT: Well, the growth figures clearly show that the economy of the United States is moving, that we're on the right track. Today we have this very high growth figure. Just a few days ago we got the good news that the deficit has dropped dramatically now for three years in a row. We need to build on this. We do not need to reverse our economic course. That's the message I have for the Congress on the deficit reduction. We should balance the budget. We should continue to reduce the size of the federal government. But we need to do it in a prudent way that continues to invest in our people, in our education, our technology, for the health care of our seniors and the future of our children and our environment.

We are moving in the right direction. This is the right direction. Why would we reverse course? We now have virtually three years of complete economic data showing that this policy that we have followed with great discipline and determination is good for the American people. So I hope we can stay right with it.

Q Mr. President, some liberal Democrats are afraid that as part of the end game, after the veto and after the real negotiations begin, they may be left alone out there, that you'll make a deal in the center somewhere with some moderate Republicans that would be enough to see a compromise go through.

THE PRESIDENT: Well, first of all, my goal would be to have a budget that would be -- get a huge bipartisan vote. And my principles have been clear. If there are those even in my own party who do not favor a balanced budget at all, then there will come a time when we'll be on different sides of the fence on that.

But I would ask you to remember, look how much the liberal Democrats have done to move to a dynamic center in the last three years. They voted for deficit reduction; they voted for a very tough crime bill; they voted for an education reform bill that had high standards and let us let all kinds of states and school districts get out from under federal regulations. They are moving. And I think most of the traditional liberal Democrats are trying to create a dynamic future. I believe they will vote for a balanced budget if it's the right kind of one.

You know, the Republicans' leaders say they have certain principles. And they are -- what are those principles? Balance the budget, secure the Medicare Trust Fund -- excuse me -- balance the budget, secure the Medicare Trust Fund, have a tax cut, and have more authority being given to the states and the local governments.

I have said I would embrace all those principles. I do believe a tax cut should be targeted toward child-rearing and education and toward the broad middle class of America. But I have certain principles. What are my principles? Don't reduce Medicare and Medicaid more rapidly, more radically than the system can contain and that will be fair to our seniors and to others that depend upon the program. Don't cut investment in education, technology and research when education, technology and research will determine our economic growth. Don't destroy the environment or our ability to regulate and maintain the public health. Those things, it seems to me, are pretty clear principles.

Now, I have already said, you know, the principles they say are important to them, they're important to me. I want to balance the budget. I'm determined to secure Medicare Trust Fund. I want a reasonable tax cut targeted to the middle class, child-rearing and education.

But I have these other principles on health care, on education, on the environment, on technology. And one other thing -- I cannot in good conscience support a budget that actually raises taxes on people with incomes under $30,000 a year more than they're cut. That is wrong. It is wrong to raise taxes on working people with children at that income level.

So if we can -- I've already said these are my principles. And I believe these principles, if furthered and if there are some other adjustments made in the budget -- if we don't do too much to harm rural America and the farming sector and a few other things -- I think you could get a huge, huge bipartisan vote for a balanced budget. But we are a long way from there right now.

Q -- this new figure what does it say that could possibly interest rates? And second of all, do you know anything about the shooting at Fort Bragg?

THE PRESIDENT: Let me answer the second question first. I received very early this morning a briefing. I know something about it, but I don't believe that I know enough, more than has been in the press, that I should comment at this moment. Obviously, I'm very concerned about it, but I don't think I should comment.

Now, the growth figure -- I don't believe the growth figure should raise interest rates because inflation is so low. Keep in mind, the inflation rate is hovering around two percent. So that's the extraordinary thing about this. The combined rates of unemployment and inflation are at a 25-year low. The danger in the economy is not inflation now. The problem in the economy, the challenge of the economy is it's a time of rapid change, so there are a lot of people who aren't getting raises, even though there's growth, and there are a lot people who are still worried about losing their jobs, even though there's growth.

Those are the challenges we have to face. That's why I want the education tax deduction. That's why I want to increase investment in education, not cut it. That's why I want to raise the minimum wage. That's why I want the G.I. Bill for America's workers to pass, so when people lose their jobs, they can immediately start new training programs.

We should be focusing on the challenges this economy poses, not undermining its strengths. That's why this budget battle ultimately is important. It's our values and what works for the economy. Both are at issue here. We can get this done, but we've got to do what's right, and we've got to do what's right for the economy.

Q Mr. President -- some of that growth was due to government purchases. Do you this growth pace can be maintained in the face of all the budget cutting that's going on?

THE PRESIDENT: Well, they say their budget will give us a slower growth for the next seven years than we've averaged in the last 25. I find that hard to believe, but that's what they say. They say their budget will give us lower business profits for the next seven years than we've averaged. I find that hard to believe, but that's what they say. They say their budget will give us higher inflation in health care costs even though they claim they're going to lower health care inflation.

There are a lot of things about their budget I don't agree with. But if we cut government expenditures, obviously, a lot of government expenditures are with private contractors. If we --for example, if we build a new airplane, most of the people who build the airplane are -- they're private sector employees. If we build a building, the people who build the building are private sector employees. But if we do this in a disciplined way, and we keep our investments up and focus on shrinking government consumption -- that is, lowering the programs that are of marginal benefit or getting rid of them, and slowly downsizing the government, although we've been in a rapid downsize period -- and we keep investing in America, then the activity in the private sector with growth will more than overcome the shrinking of the public sector. But we have to do it in a disciplined way.

That's another thing that bothers me about this health care business. I have been talking about the need to reduce health care inflation since the day I became President. I've been talking about the need to give more options for managed care since the day I became President, and since long before I became President. But you cannot just say, well, we're going to take $450 billion out of it, even though we don't know what's going to happen. It is too much. It is too extreme. It is not necessary.

So the thing for us to do is to ultimately -- what my goal is, to ultimately come out with a budget which satisfies their states principles, which I have embraced, but which honors our -- my stated principles, which they have yet to embrace. And they are -- those, the stated principles that I've put out are more important for standing up for what's right for America, number one; and more important for growing our economy, number two, than what's in their budget.

And so we're going to keep working on this, but I am not going to bend on my principles. I cannot, and it's not good for America. This program, now we have three years of evidence. It's not only morally right, it is working for the country, and we need to keep going in this direction.

Thank you.

END 11:09 A.M. EDT