President Clinton Jordan Israel Peace
Learn about 'Our Story'


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February 17, 1993

Mr. President, Mr. Speaker

When Presidents speak to the Congress and the nation
from this podium, they typically comment on the full
range of challenges and opportunities that face us. But
these are not ordinary times. For all the many tasks
that require our attention, one calls on us to focus,
unite, and act. Together, we must make our economy
thrive once again.

It has been too long -- at least three decades --
since a President has challenged Americans to join him on
our great national journey, not merely to consume the
bounty of today but to invest for a much greater one

Nations, like individuals, must ultimately decide
how they wish to conduct themselves -- how they wish to
be thought of by those with whom they live, and, later,
how they wish to be judged by history. Like every man
and woman, they must decide whether they are prepared to
rise to the occasions history presents them.

We have always been a people of youthful energy and
daring spirit. And at this historic moment, as communism
has fallen, as freedom is spreading around the world, as
a global economy is taking shape before our eyes,
Americans have called for change -- and now it is up to
those of us in this room to deliver.

Our nation needs a new direction. Tonight, I
present to you our comprehensive plan to set our nation
on that new course.

I believe we will find our new direction in the
basic values that brought us here: opportunity,
individual responsibility, community, work, family, and
faith. We need to break the old habits of both political
parties in Washington. We must say that there can be no
more something for nothing, and we are all in this

The conditions which brought us to this point are
well known. Two decades of low productivity and stagnant
wages; persistent unemployment and underemployment; years
of huge government deficits and declining investment in
our future; exploding health care costs, and lack of
coverage; legions of poor children; educational and job
training opportunities inadequate to the demands of a
high wage, high growth economy. For too long we drifted
without a strong sense of purpose, responsibility or
community, and

our political system too often was paralyzed by special
interest groups, partisan bickering and the sheer
complexity of our problems.

I know we can do better, because ours remains the
greatest nation on earth, the world's strongest economy,
and the world's only military superpower. If we have the
vision, the will and the heart to make the changes we
must, we will enter the 21st century with possibilities
our parents could not even have imagined, having secured
the American dream for ourselves and future generations.

I well remember, twelve years ago Ronald Reagan
stood at this podium and told the American people that if
our debt were stacked in dollar bills, the stack would
reach sixty-seven miles into space. Today, that stack
would reach two hundred and sixty-seven miles.

I tell you this not to assign blame for this
problem. There is plenty of blame to go around -- in
both branches of the government and both parties. The
time for blame has come to an end. I came here to accept
responsibility; I want you to accept responsibility for
the future of this country, and if we do it right, I
don't care who gets the credit for it.

Our plan has four fundamental components:

First, it reverses our economic decline, by jump-
starting the economy in the short term and investing in
our people, their jobs and their incomes in the long

Second, it changes the rhetoric of the past into the
actions of the present, by honoring work and families in
every part of our lives.

Third, it substantially reduces the federal deficit,
honestly and credibly.

Finally, it earns the trust of the American people
by paying for these plans first with cuts in government
waste and inefficiency -- cuts, not gimmicks, in
government spending -- and by fairness, for a change, in
the way the burden is borne.

Tonight, I want to talk about what government can
do, because I believe our government must do more for the
hard-working people who pay its way. But let me say
first: government cannot do this alone. The private
sector is the engine of economic growth in America. And
every one of us can be an engine of change in our own
lives. We've got to give people more opportunity, but we
must also demand more responsibility in return.

Our immediate priority is to create jobs, now. Some
say we're in a recovery. Well, we all hope so. But
we're simply not creating jobs. And there is no recovery
worth its salt that does not begin with new jobs.

To create jobs and guarantee a strong recovery, I
call on Congress to enact an immediate jobs package of
over 30 billion dollars. We will put people to work
right now and create half a million jobs: jobs that will
rebuild our highways and airports, renovate housing,
bring new life to our rural towns, and spread hope and
opportunity among our nation's youth with almost 700,000
jobs for them this summer alone. And I invite America's
business leaders to join us in this effort, so that
together we can create a million summer jobs in cities
and poor rural areas for our young people.

Second, our plan looks beyond today's business
cycle, because our aspirations extend into the next
century. The heart of our plan deals with the long term.
It has an investment program designed to increase public
and private investment in areas critical to our economic
future. And it has a deficit reduction program that will
increase savings available for private sector investment,
lower interest rates, decrease the percentage of the
federal budget claimed by interest payments, and decrease
the risk of financial market disruptions that could
adversely affect the economy.

Over the long run, all this should result in a
higher rate of economic growth, improved productivity,
higher wages, more high-quality jobs and an improved
economic competitive position in the global economy.

In order to accomplish public investment and deficit
reduction, government spending is being cut and taxes are
being increased. Our spending cuts were carefully
thought through to try to minimize any economic impact,
to capture the peace dividend for investment purposes,
and to switch the balance in the budget from consumption
to investment. The tax increases and spending cuts were
both designed to assure that the cost of this historic
program to face and deal with our problems is borne by
those who could most readily afford that cost.

Our plan is designed to improve the health of
American business through lower interest rates, improved
infrastructure, better trained workers, and a stronger
middle class. Because small businesses generate most of
our nation's jobs, our plan includes the boldest targeted
incentives for small business in history. We propose a
permanent investment tax credit for small business, and
new rewards for entrepreneurs who take risks. We will
give small business access to the brilliant technologies
of our time and to the credit they need to prosper and

With a new network of community development banks,
and one billion dollars to make the dream of enterprise
zones real, we will begin to bring new hope and new jobs
to storefronts and factories from South Boston to South
Texas to South-Central Los Angeles.

Our plan invests in our roads, bridges, transit
facilities; in high-speed railways and high-tech
information systems; and in the most ambitious
environmental clean-up of our time.

On the edge of the new century, economic growth
depends as never before on opening up new markets
overseas. And so we will insist on fair trade rules in
international markets.

A part of our national economic strategy must be to
expand trade on fair terms, including successful
completion of the latest round of world trade talks. A
North American Free Trade Agreement with appropriate
safeguards for workers and the environment. At the same
time, we need an aggressive attempt to create the hi-tech
jobs of the future; special attention to troubled
industries like aerospace and airlines, and special
assistance to displaced workers like those in our defense

I pledge that business, government and labor will
work together in a partnership to strengthen America for
a change.

But all of our efforts to strengthen the economy
will fail unless we take bold steps to reform our health
care system. America's businesses will never be strong;
America's families will never be secure; and America's
government will never be solvent until we tackle our
health care crisis.

The rising costs and the lack of care are
endangering both our economy and our lives. Reducing
health care costs will liberate hundreds of billions of
dollars for investment and growth and new jobs. Over the
long run, reforming health care is essential to reducing
our deficit and expanding investment.

Later this spring, I will deliver to Congress a
comprehensive plan for health care reform that will
finally get costs under control. We will provide
security to all our families, so that no one will be
denied the coverage they need. We will root out fraud
and outrageous charges, and make sure that paperwork no
longer chokes you or your doctor. And we will maintain
American standards -- the highest quality medical care in
the world and the choices we demand and deserve. The
American people expect us to deal with health care. And
we must deal with it now.

Perhaps the most fundamental change our new
direction offers is its focus on the future and the
investments we seek in our children.

Each day we delay carries a dear cost. Half our
two-year-olds don't receive immunizations against deadly
diseases. Our plan will provide them for every eligible
child. And we'll save ten dollars for every one we'll
spend by eliminating preventable childhood diseases.

The Women, Infants, and Children nutrition program
will be expanded so that every expectant mother who needs
our help receives it.

Head Start -- a program that prepares children for
school -- is a success story. It saves money, but today
it reaches only one-third of all eligible children.
Under our plan, we will cover every eligible child.
Investing in Head Start and WIC is not only the right
thing, it's the smart thing. For every dollar we invest
today, we save three tomorrow.

America must ask more of our students, our teachers,
and our schools. And we must give them the resources
they need to meet high standards.

We will bring together business and schools to
establish new apprenticeships, and give young people the
skills they need today to find productive jobs tomorrow.

Lifelong learning will benefit workers throughout
their careers. We must create a new unified worker
training system, so that workers receive training
regardless of why they lost their jobs.

Our national service program will make college loans
available to all Americans, and challenge them to give
something back to their country -- as teachers,
police officers, community service workers. This will
be an historic change on a scale with the creation of the
Land Grant Colleges and the G.I. Bill. A hundred years
from now, historians who owe their education to our plan
for national service will salute your vision.

We believe in jobs, we believe in learning, and we
believe in rewarding work. We believe in restoring the
values that make America special.

There is dignity in all work, and there must be
dignity for all workers. To those who heal our sick,
care for our children, and do our most tiring and
difficult jobs, our new direction makes this solemn

By expanding the Earned Income Tax Credit, we will
make history: We will help reward work for millions of
working poor Americans. Our new direction aims to
realize a principle as powerful as it is simple: If you
work full time, you should not be poor.

Later this year, we will offer a plan to end welfare
as we know it. No one wants to change the welfare system
as much as those who are trapped by the welfare system.

We will offer people on welfare the education,
training, child care and health care they need to get
back on their feet. Then, after two years, they must get
back to work -- in private business if possible; in
public service, if necessary. It's time to end welfare
as a way of life.

Our next great goal is to strengthen American

We'll ask fathers and mothers to take more
responsibility for their children. And we'll crack down
on deadbeat parents who won't pay their child support.

We want to protect our families against violent
crime which terrorizes our people and tears apart our
communities. We must pass a tough crime bill.

We need to put 100,000 more police on the street, provide
boot camps for first-time non-violent offenders, and put
hardened criminals behind bars. We have a duty to keep
guns out of the hands of criminals. If you pass the
Brady Bill, I'll sign it.

To make government work for middle-class taxpayers
and not the special interests, we must reform our
political system.

I'm asking Congress to enact real campaign finance
reform. Let's reduce the power of special interests and
increase the participation of the people. We should end
the tax deduction for special interest lobbying and use
the money to help clean up the political system. And we
should quickly enact legislation to force lobbyists to
disclose their activities.

But to revolutionize government we have to insure
that it lives within its means. And that starts at the
top -- with the White House. In the last few weeks, I
have cut the White House staff by twenty-five percent,
saving ten million dollars. I ordered administrative
cuts in the budgets of agencies and departments, I cut
the federal bureaucracy by 100,000 positions, for
combined savings of nine billion dollars. It's time for
government to be as frugal as any household in America.
That's why I congratulate the Congress

for taking similar steps to cut its costs today.
Together, we can show the American people that we have
heard their call for change.

But we can go further. Tonight, I call for an
across-the-board freeze in federal government salaries
for one year. Thereafter, federal salaries will rise at
a rate lower than the rate of inflation.

We must reinvent government to make it work again.
We'll push innovative education reform to improve
learning, not just spend more money. We'll use the
Superfund to clean up pollution, not just increase
lawyers' incomes. We'll use federal banking regulators,
not just to protect the security and safety of our
financial institutions, but to break the credit crunch.
And we'll change the whole focus of our poverty programs
from entitlement to empowerment.

For years, there has been a lot of talk about the
deficit, but very few credible efforts to deal with it.
This plan does. Our plan tackles the budget deficit --
seriously and over the long term. We will put in place
one of the biggest deficit reductions and the biggest
change of federal priorities in our history at the same

We are not cutting the deficit because the experts
tell us to do so. We are cutting the deficit so that
your family can afford a college education for your
children. We are cutting the deficit so that your
children will someday be able to buy a home of their own.
We are cutting the deficit so that your company can
invest in retraining its workers and retooling its
factories. We are cutting the deficit so that government
can make the investments that help us become stronger and
smarter and safer.

If we do not act now, we will not recognize this
country ten years from now. Ten years from now, the
deficit will have grown to 635 billion dollars a year;
the national debt will be almost 80 percent of our gross
domestic product. Paying the interest on that debt will
be the costliest government program of all, and we will
continue to be the world's largest debtor, depending on
foreign funds for a large part of our nation's

Our budget will, by 1997, cut 140 billion dollars
from the deficit -- one of the greatest real spending
cuts by an American president. We are making more than
150 difficult, painful reductions which will cut federal
spending by 246 billion dollars. We are eliminating
programs that are no longer needed, such as nuclear power
research and development. We are slashing subsidies and
cancelling wasteful projects. Many of these programs
were justified in their time. But if we're going to
start new plans, we must eliminate old ones.

Government has been good at building programs, now we
must show that we can limit them.

As we restructure American military forces to meet
the new threats of the post-Cold War world, we can
responsibly reduce our defense budget. But let no one be
in any doubt: The men and women who serve under the
American flag will be the best trained, best equipped,
best prepared fighting force in the world, so long as I
am President.

Backed by a leaner and more effective national
defense and a stronger economy, our nation will be
prepared to lead a world challenged by ethnic conflict,
the proliferation of weapons of mass destruction, the
global democratic revolution, and the health of our

Our economic plan is ambitious, but it is necessary
for the continued greatness of our country. And it will
be paid for fairly -- by cutting government, by asking
the most of those who benefitted most in the past --by
asking more Americans to contribute today so that all
Americans can do better tomorrow.

For the wealthiest -- those earning more than
180,000 dollars per year, I ask you to raise the top rate
for federal income taxes from 31 percent to 36

percent. Our plan recommends a ten percent surtax on
incomes over 250,000 dollars a year. And we will close
the loopholes that let some get away without paying any
tax at all.

For businesses with taxable incomes over ten million
dollars, we will raise the corporate tax rate to 36
percent. And we will cut the deduction for business

Our plan attacks tax subsidies that reward companies
that ship jobs overseas. And we will ensure that,
through effective tax enforcement, foreign corporations
who make money in America pay the taxes they owe to

Middle-class Americans should know: You're not
going alone any more; you're not going first; and you're
no longer going to pay more and get less. Ninety-eight
point eight percent of America's families will have no
increase in their income tax rates. Only the wealthiest
one point two percent will see their rates rise.

Let me be clear: There will be no new cuts in
benefits from Medicare for beneficiaries. There will be
cuts in payments to providers: doctors, hospitals, and
labs, as a way of controlling health care costs. These
cuts are only a stop-gap until we reform the whole health
care system. Let me repeat

that, because it matters to me, as I know it matters to
you: This plan will not make new cuts in Medicare
benefits for any beneficiary.

The only change we are making in Social Security is
to ask those older Americans with higher incomes, who do
not rely solely on Social Security to get by, to
contribute more. This change will not affect eighty
percent of Social Security recipients. If you do not pay
taxes on Social Security now, you will not pay taxes on
Social Security under this plan.

Our plan includes a tax on energy as the best way to
provide us with new revenue to lower the deficit and
invest in our people. Moreover, unlike other taxes, this
one reduces pollution, increases energy efficiency, and
eases our dependence on oil from unstable regions of the

Taken together, these measures will cost an American
family earning 40 thousand dollars a year less than 17
dollars a month. And because of other programs we will
propose, families earning less than 30,000 dollars a year
will pay virtually no additional tax at all. Because of
our publicly stated determination to reduce the deficit,
interest rates have fallen since the election. That
means that, for the middle class, the increases in energy
costs will be more than offset by lower interest costs
for mortgages, consumer

loans and credit cards. This is a wise investment for
you and for your country.

I ask all Americans to consider the cost of not
changing, of not choosing a new direction. Unless we
have the courage to start building our future and stop
borrowing from it, we are condemning ourselves to years
of stagnation, interrupted only by recession; to slow
growth in jobs, no growth in incomes, and more debt and

Worse yet -- unless we change, unless we reduce the
deficit, increase investment, and raise productivity so
we can generate jobs -- we will condemn our children and
our children's children to a lesser life and a diminished

Tonight, the American people know we must change.
But they are also likely to ask whether we have the
fortitude to make those changes happen.

They know that, as soon as we leave this Chamber,
the special interests will be out in force, trying to
stop the changes we seek. The forces of conventional
wisdom will offer a thousand reasons why it can't be

And our people will be watching and wondering to see if
it's going to be business as usual again.

So we must scale the walls of their skepticism, not
with our words, but by our deeds. After so many years of
gridlock and indecision, after so many hopeful beginnings
and so few promising results, Americans will be harsh in
their judgments of us if we fail to seize this moment.

This economic plan cannot please everybody. If this
package is picked apart, there will be something that
will anger each of us. But, if it is taken as a whole,
it will help all of us.

Resist the temptation to focus only on a spending
cut you don't like or some investment not made. And
nobody likes tax increases. But let's face facts: For
20 years incomes have stalled. For years, debt has
exploded. We can no longer afford to deny reality. We
must play the hand we were dealt.

The test of our program cannot simply be: What's in
it for me? The question must be: What's in it for us?

If we work hard -- and work together -- if we
rededicate ourselves to strengthening families, creating
jobs, rewarding work, and reinventing government, we can
lift America's fortunes once again.

Tonight I ask everyone in this Chamber -- and every
American -- to look into their hearts, spark their hopes,
and fire their imaginations. There is so much good, so
much possibility, so much excitement in our nation. If
we act boldly, as leaders should, our legacy will be one
of progress and prosperity. This, then, is America's new
direction. Let us summon the courage to seize the day.

Thank you very much. Good night. And may God bless


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