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Office of the Press Secretary

For Immediate Release November 13, 1995


I am returning herewith without my approval H.R. 2586, a bill that would provide a temporary increase in the public debt limit while adding extraneous measures that have no place on legislation of this kind.

This bill would make it almost inevitable that the Government would default for the first time in our history. This is deeply irresponsible. A default has never happened before, and it should not happen now.

I have repeatedly urged the Congress to pass promptly legislation raising the debt limit for a reasonable period of time to protect the Nation's creditworthiness and avoid default. Republicans in the Congress have acknowledged the need to raise the debt limit; the budget resolution calls for raising it to $5.5 trillion, and the House and Senate voted to raise it to that level in passing their reconciliation bills.

This bill, however, would threaten the Nation with default after December 12 -- the day on which the debt limit increase in the bill would expire -- for two reasons:

First, under this bill, on December 13 the debt limit would fall to $4.8 trillion, an amount $100 billion below the current level of $4.9 trillion. The next day, more than $44 billion in Government securities mature, and the Federal Government would be unable to borrow the funds to redeem them. The owners of those securities would not be paid on time.

Second, the bill would severely limit the cash management options that the Treasury may be able to use to avert a default. Specifically, it would limit the Secretary's flexibility to manage the investments of certain Government funds -- flexibility that the Congress first gave to President Reagan. Finally, while the bill purports to protect benefit recipients, it would make it very likely that after December 12, the Federal Government would be unable to make full or timely payments for a wide variety of Government obligations, including interest on the public debt, Medicare, Medicaid, military pay, certain veterans' benefits, and payments to Government contractors.

As I have said clearly and repeatedly, the Congress should keep the debt limit separate from the debate over how to balance the budget. The debt limit has nothing to do with reducing the deficit; it has to do with meeting the obligations that the Government has already incurred.

Nevertheless, Republicans in the Congress have resorted to extraordinary tactics to try to force their extreme budget and priorities into law. In essence, they have said they will not pass legislation to let the Government pay its bills unless I accept their extreme, misguided priorities.

This is an unacceptable choice, and I must veto this legislation.

The Administration also strongly opposes the addition of extraneous provisions on this bill. Items like habeas corpus and regulatory reform are matters that should be considered and debated separately. Extraneous issues of this kind have no place in this bill.

The Congress should pass a clean bill that I can sign. With that in mind, I am sending the Congress a measure to raise the permanent debt limit to $5.5 trillion as the Congress called for in the budget resolution, without any extraneous provisions.



November 13, 1995.

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