January 27, 1998
BRIEFING ON THE STATE OF THE UNION ADDRESS BY GENE SPERLING AND
SENIOR ADMINISTRATION OFFICIALS
3:07 P.M. EST
THE WHITE HOUSE
Office of the Press Secretary
________________________________________________________________
For Immediate Release January 27, 1998
BRIEFING ON THE STATE OF THE UNION ADDRESS
BY
GENE SPERLING AND SENIOR ADMINISTRATION OFFICIALS
The Roosevelt Room
3:07 P.M. EST
SENIOR ADMINISTRATION OFFICIAL: We'll go ON BACKGROUND.
It's not embargoed. What we're going to do is my colleague is going
to briefly give you an overview on the speech tonight. Another
senior administration official will talk a little bit more in detail
on the substance. Gene Sperling will stop by and has the specific
area of Social Security he wants to talk to you about. And then
after that, we'll be happy to take any questions you have about that
or anything else.
So do you want to go quickly over the speech tonight.
SENIOR ADMINISTRATION OFFICIAL: Sure. A lot of what
has driven the speech, as just a matter of the calendar, the
President made the final decisions on his budget remarkably early, on
Christmas Day. And so policies that are driven by the budget were
locked in place remarkably early. That gave him time then -- again,
almost a month to the day -- to work on the framework to present to
the country.
And one of the things that he has expressed is that in
this speech, rather than simply a national to-do list, which is what
every State of the Union is in good measure, he wanted to set a
larger philosophical framework of his approach to governing, sort of
answer the question of, is there Clintonism, or what is Clintonism.
And the speech -- it's a pretty high bar to set, but I think this
speech does a good job of meeting that.
He wants to try to express -- and he'll do it in his
words tonight -- why this approach that he's had now for five years,
the philosophy that animates it, and obviously he'll briefly touch on
why and how it has succeeded, and then carrying it forward.
And the construct basically will be very familiar to
those of you who have covered him over the years: an economy that
offers opportunity, a society that demands responsibility, a nation
rooted in community. And you all have used those words a lot, and so
has he. And one of the things that the President wants to do in this
speech is to make sure that those values are given some meaning. He
says, at each critical juncture in American history, we have had to
change and have new means and methods to advance enduring virtues and
values.
And I think the speech does a very good job of doing
that, and it, I think, reflects then, going into a new century, a new
way of using the government as a catalyst for change. And I think it
sets a dynamic for the issue terrain going into this new century that
is much more old-new than left-right. And I think that's been one of
the -- as a political person -- one of the innovations of Clintonism.
And I'd like my colleague to get into the substance now.
SENIOR ADMINISTRATION OFFICIAL: Let me spend a few
minutes and try to give you an overview of what some of the themes of
the speech will be. The President will begin by outlining his
overall strategy to get the economy creating opportunities, and that
really consists of three pieces.
The first part is driving the budget deficit down to
zero and restoring fiscal responsibility in this country. We can go
back to 1993 when the President was elected, the projected deficit
was $290 billion and projected to skyrocket. Very tough decisions
were made and huge progress has been made. We have a $22 billion
budget deficit this year and the President will be submitting a
budget in the next fiscal year that is in balance. This is a
tremendous accomplishment.
It's a tremendous accomplishment because it has really
spurred growth in this economy, and the reason for trying to balance
the budget is not just to get rid of the red ink but to build a
strong economy. We have over 15 million jobs that have been created.
We have an unemployment rate that is the lowest in 24 years. Family
incomes are rising; they're up over $2,000 in real terms just since
1993. We've had an investment-led recovery that's really succeeding,
I think, in raising productivity into the future and promoting higher
living standards. Brought down interest rates. Home ownership is at
the highest level in history. And the President is going to
emphasize the importance of maintaining the kind of fiscal discipline
that has gotten us to where we are.
He will talk a bit about the importance of committing
any budget surpluses that may appear, to hold them until we have
dealt with Social Security. And Gene is going to come later and talk
a bit more about what the President is going to have to say about
Social Security. The major message there is going to be that if we
end up having surpluses -- we don't have them yet, but if we do,
Social Security is so important, to ensure its financial integrity.
Until we have done that and accomplished that, we should reserve
those surpluses. And Gene will have more to say about Social
Security.
The second important prong of the economic strategy for
creating opportunity, of course, is education and training, investing
in the American people, which is the key to opportunity. And the
President will talk about the importance of raising standards,
raising expectations, raising accountability to make our public
elementary and secondary schools the best in the world. Some of the
things he will call for will be voluntary national testing and
standards in reading and mathematics. He will propose putting
100,000 new teachers who are well qualified into our schools to
reduce class size to an average of 18 nationally in grades one to
three. He'll talk about a school construction tax cut that will be
designed to rebuild, modernize, build new schools. He'll talk about
a mentoring program that will make sure that young people,
particularly in low-income communities, prepare themselves adequately
for college and have the information that they need to take advantage
of the opportunities that are there. And he's going to point out
that we now are at a point where really any American who wants to go
to college can go to college.
He's going to talk about the importance of raising
standards in the nation's high schools and looking around the country
and trying to improve practices and then create models that school
districts around the country can use to perpetuate best practices.
The final piece of the economic strategy to create
opportunity has to do with tearing down trade barriers to open new
markets for American products and opportunities for American workers
around the world. He'll talk about fast track and the need for
Congress to grant traditional trade negotiating authority so that we
can take advantage of opportunities to open markets around the world
to American goods and services where we're extremely competitive, and
the importance of this to America's future.
He will emphasize that, while trade is very good for
America and stimulates growth, there are workers who are adversely
affected by it and by change in general; displacement does occur.
And he will discuss a G.I. Bill for workers to help provide funding
for training for dislocated workers.
He will also emphasize the need to provide support for
the IMF so they can do the important work that they're doing now in
Asia. We have a world economy that is increasingly integrated and we
have a stake in the well-being and the progress and the growth in
those countries. And if they're willing to undertake fundamental
reforms, we should support those efforts.
The next piece of the speech concerns responsibility and
the importance that the President attaches to creating a society that
acts responsibly. Some of the points that he'll mention have to do
with moving people from welfare to work. He'll challenge businesses
to continue joining the 3,000 companies that have already agreed to
take part in the Welfare to Work Partnership. He'll discuss
welfare--to-work housing vouchers to help welfare people move to jobs
where they're available.
In the area of health care, he'll discuss a health care
consumer bill of rights that will call for protections that will
guarantee access to health care specialists, ensure that high-quality
care is available, that there is access to emergency room services.
In the area of affordable health care, you know that the
President has already discussed his proposal to allow buy-ins for
individuals age 62 to 65 in a self-financing manner into Medicare,
and for displaced workers over age 55 to also have available a buy-in
option. The purpose of that is to increase accessibility so that
some highly affected groups that have difficulty in gaining access to
quality care, have access but that it would be self-financing.
Finally, I think you're already familiar with the child
care initiatives. The President will reiterate his plan to improve
child care for working families and talk about the components of
that, which include both child care subsidies and also tax credits.
He'll have something to say as well about juvenile crime
and drugs, talk about the importance of finishing the job of putting
100,000 police on the streets, and passing a crime bill that would
crack down on gangs, guns, drugs.
Let me turn to the portion on strengthening our
communities. The President will put forward a plan that's designed
to strengthen American communities in a variety of ways. The first
component involves investing in our cities to give them the tools and
opportunities that they need to create an urban renaissance. Some of
the components of that plan would be increased funding for
empowerment zones and for community development banks, as well as
increased funding for low-income housing tax credits.
There will be an environment component to the speech.
The President will talk in particular about climate change and some
of the plans he has to provide over $6 billion, through a combination
of tax cuts and increased funding for research and development, to
find ways to spur progress in new research for clean energy,
including energy efficiency. He'll talk a little bit about clean
water and strengthening the clean water initiative.
And finally, I think the President will also underscore
the importance of the initiative on race and continuing the goal of
creating a just and fair society.
Finally, I'd just mention, we are approaching the
millennium and the time has come to think about gifts to the future,
and one of the gifts to the future I think that the President will
propose is the creation of a 21st century research fund that would
see a very substantial expansion in funding, particularly for
biomedical research, that we're at a point where great breakthroughs
may be possible in disease like cancer, and that it's wise at this
point to make a major investment in funding.
Let me stop there and turn to Gene for some comments on
Social Security.
Q Wait a minute, before we go there, is there a price
tag on all of these items?
MR. SPERLING: Can you help me out on this one thing?
They need me back there, so if I could do Social Security, which has
some questions, let me get that on the table.
Today is the day the President is making a fairly
definitive statement on two of the -- perhaps two of the most major
fiscal issues of the next several years, which is how the country
should deal with a projected surplus and what we should do about
long-term Social Security reform.
The President essentially has a three-part message here
related to these two issues. Let me say that briefly, and I'm going
to come back to the first part a bit and explain it in more detail.
The first part is that he is going to call for, that every penny of a
projected surplus should be saved, not spent or given away in any
context. All of the surplus should be saved until we have come
forward as a country with a long-term Social Security solution.
In other words, that is not saying how much exactly of
the surplus should go to Social Security. What it is saying is that
all of it should be saved until you know how much of it is needed to
help cure the long-term Social Security solvency issue. And I think
that that is a very major statement, both on his seriousness on
Social Security reforms but also on maintaining the sense of fiscal
discipline that has helped this country so much over the last several
years. And it's so important, not only for our prosperity, but I
think in terms of the United States being the bulwark of financial
confidence that it now is at this particular moment in the world
economy.
So it is a message to all sides that whatever your
priorities are, that it's time to slow down; that we don't need a
feeding frenzy here on the projected surplus; and that before one
entertains how the surplus should be used, whether it is for --
whatever challenge it's for, that first one should see how much of it
is needed as part of a long-term Social Security reform package.
Secondly, as a means of elevating the importance of
passing long-term Social Security reform, the President will be
elevating the importance of having several months of a national
conversation on the importance of Social Security reform, what the
choices are, what the challenges are. And the President feels that
this not only has to be elevated and he not only has to call on
citizens to become active and informed, but that it's also very
important that we keep this at a level at which it does not become
politicized, that it does not become a partisan battle, but that we
do everything we can during this time period to have a fair and
balanced and bipartisan discussion.
In order to encourage that, the President has asked the
AARP and the Concord Coalition to cosponsor and cohost three to four
regional forums around the country in which either himself or the
Vice President would participate, as well as other members of his
Cabinet and administration, and, it is our hope, key members of the
Democrats and Republican Congress, men and women who have been
involved in this issue.
By having these two groups, the preeminent seniors'
group and the preeminent group that is focused on deficit reduction
and fiscal discipline cosponsor it, that will make very clear that we
are trying to elevate this and keep an atmosphere of bipartisanship
and civility, which was so essential to us passing the Balanced
Budget Act of 1997.
Q Can I assume that they agreed to do that?
MR. SPERLING: And they have agreed to do that. In fact
I just saw the Concord Coalition's advisory statement.
Q Do you know when? Would this be in the next year or
over the next few months?
MR. SPERLING: It would be over the next few -- it
would be in 1998 and it would culminate in a White House Conference
on Social Security at the end of the year.
The third element is that the President tonight will
call on the Congressional bipartisan leadership to sit down with him
at the beginning of next year and begin the process of hammering out
a long-term Social Security legislative solution. So the purpose of
this is not simply education or elevation for its sake but to create
an atmosphere where we can do something that the country has never
done before, which is to confront a long-term fiscal crisis -- not
when it became a crisis but in a preventative measure that can be
done with more measured steps because the problem is being taken on
early.
So, again, he is saying that the surplus should be
reserved until a Social Security plan is come up with; second, that
we should have this national conversation and work towards national
consensus. And, third, that this should lead to a real bipartisan
legislative effort to get things done. In the end, it is the key
players in Congress and the President who have to come together if
this is going to happen and that is who he is going to be calling on
to work with him next January.
What I do want to say is that one of the things I think
is very strong about this plan is that it has a disciplining process,
a disciplining effect in two ways. Number one, the country has done
very well by having this period of the fiscal discipline and by
saying that all proposals, from all political stripes, all of them
that use the surplus should be put on hold until we fix Social
Security. We are maintaining that sense of fiscal discipline, and
we're doing it regardless of the merits of a particular proposal.
And, secondly, it puts pressure on the political process
to take on this issue. The biggest threat to Social Security reform
is the temptation to kick it down the road year after year until your
options become less and less, or more severe. And what this does is
it puts tremendous pressure on the political process to solve Social
Security long-term challenges, by basically saying that no other
debate on the surplus should take place until this is taken care of.
Q How are you defining surplus, and where are you
going to put the money?
MR. SPERLING: Well, in the time period that we are
taking about, which is 1998-99, in terms of this period, what we are
mostly trying to protect is, when the budgets come out you will see
that the projected surpluses over the next five years amount to $200
billion. And our interest is to prevent legislation that would spend
that money, whether it's on spending or tax cuts, that would spend
that money before we know how much of that surplus is needed, along
with other measures to be part of a long-term Social Security reform
package. That is the element.
Technically, we just have, if you have a surplus during
this time period and there is not legislation, a surplus -- what
would happen automatically now is that money would go to paying down
the debt. And that is still, in a sense, saving the money and, as my
colleague would say, whether the money is being saved as part of the
reducing the debt or Social Security, it still has the same impact in
terms of national savings.
But by reserving that, those funds and the future,
surplus funds, you are ensuring that if some of those are needed to
be part of a long-term Social Security package, we are ensuring that
those surpluses would not be dissipated before we have even had a
chance to look at Social Security. Or, put another way, what we are
really saying is the President said he had a two-part obligation of
fiscal discipline. One was to balance the budget, and second was to
look at long-term issues like Social Security.
And we're saying, before we engage in a debate on other
uses for the surplus, let's see how much of this is needed as part of
a long-term Social Security reform.
Q Would we be accurate in describing -- until the
Social Security problem is solved, all surpluses should go towards
reducing the national debt -- paying off the national debt?
MR. SPERLING: Let me say the following: I, we would
say that until the Social Security is solved, the funds should not,
people should not spend the tax -- excuse me -- not spend the surplus
on their priorities. Whether, down the road -- what you could be
asking is, hypothetically, if Social Security reform didn't happen,
and the surplus started to accumulate, if we wanted at some point, it
would be conceivable that you could do legislation that could somehow
hold that in some way for Social Security.
We're hoping not to have to confront that situation
because our aim is to get this done in '98 or '99. In the absence of
that, the money would automatically just pay down the debt, which is
still saving money in a sense, But, again, our main focus is to say
none of this should be spent on either tax cut or spending proposal,
until we have seen how much is needed to cure long-term Social
Security --
Q It would go to pay down the debt.
MR. SPERLING: This is obviously one of the most
confusing topics, and it is not just -- I'm not just saying
confusing, it's confusing for anybody and everybody. But let me just
explain what I mean. If Social Security -- when we say money should
be saved to see if it's needed for Social Security, we envision that
some part of the surplus would probably be needed to help the Social
Security trust fund; in other words, that some of the savings would
go to the Social Security trust fund as part of a long-term Social
Security reform.
So we do envision the possibility that when people come
up with a long-term Social Security plan, that part of their
solutions will be to use some of the savings from the surplus to help
strengthen the Social Security trust fund. We're not making a
decision at this moment how much or what percentage. We're just
saying that all of it should essentially be protected from being
spent or tax-cut away until you see how much of that.
Now, a second question is, well, what if Social Security
reform didn't happen as quickly as you'd like -- what would happen
then. One of two things: you would then either let the surpluses
under current law accumulate, and they would reduce down the debt; or
one could at that point have some form of legislation which in some
way kept open the possibility that that could be used for Social
Security. But, again, the major amounts of the surplus are not
projected to happen in '98 and '99.
Q In that the Republicans already have other ideas on
the surplus, what makes you think they would go along with this.
MR. SPERLING: Because I think that this is a powerful
message by the President of the United States to people of all
political stripes on both sides of the aisle. He's saying, whatever
your priorities are, we should put Social Security first, and that's
how he'll describe it in his speech tonight. He'll say we need to
put Social Security first. We have to take care --
Q Is that a quote? Is he going to say, put Social
Security first -- is he going to say that?
MR. SPERLING: That's what he will say in the State of
the Union tonight.
Q Thanks.
MR. SPERLING: I think that it is -- or we're looking
real bad. I'm looking real bad.
I think the reason why this will have a lot of power is
because it is a message that average Americans would understand.
Everybody understands the notion that when you have a certain amount
of savings, that you have to do what you have to do before you do
what you want to do. And part of what we have had to do for our five
years there is reduce the deficit. That's not what we prefer to do.
We prefer to be investing in education, but part of what we had to
do, part of the challenge we face, is we had to do things like invest
in education at the same time we brought down the deficit.
And, what we're saying now is part of what else we have
to do is still be able to make progress on things while taking care
of another fiscal challenge, which is the generational deficit
entailed in Social Security reform.
And so I think that that will be a powerful message.
It's a message that will go to anybody. And let me say honestly,
this is a disciplining device, not just on Democrats and Republicans,
it's a disciplining device on us.
Q How is it a disciplining device when the tax payer
may take out of this, all you're doing is taking $200 billion more
from them when they could be getting back something in tax cuts while
you guys try to figure out how to save Social Security? Why
shouldn't people get some sort of cash back or some sort of a tax cut
if we're talking such a high figure.
MR. SPERLING: That is a debate that we may very well
have. And what we will argue is that Social Security right now is
not funded for the long term. Younger people rightly believe that
Social Security will not be there in the strong form for them in
their retirement years. And we're saying that, sure, tax cuts are
nice. Everybody likes tax cuts. But our view is that you had to do
it in a fiscally responsible context.
When we proposed targeted tax cuts, we have paid for
them. And what we're saying -- and if others want to propose tax
cuts and pay for them -- I want to make this clear -- if others want
to propose tax cuts or spending initiatives
I want to make this clear: if others want to propose
tax cuts or spending initiatives different from what we have and pay
for them with different offsets or use some of the offsets we have --
we might disagree with that policy-wise, but that would be consistent
with this approach. What we are saying is that before you go using
the surplus, before you go saying, I don't have to pay for my
initiative, I'm going to use the surplus, they should not give the
impression to the American people that that is just free money.
Those are savings that are very much needed to help solve Social
Security.
And we're going to say, not that that surplus couldn't
go to other things down the road, but that you should save Social
Security first and make sure that you have the surplus, that the
savings from the surplus are at least held until we see how much of
it is needed for Social Security. I think that will be a strong
case. Certainly, some will say, no, we shouldn't hold that money for
Social Security, we should spend it on a tax cut or spend it on a
spending project, and we will argue our side.
Q Have you checked with some of the Democratic
leadership in Congress, and what kind of reaction do you have from
them to this proposal?
MR. SPERLING: Well, I should say this is the best kept
secret we've ever had. And part of that was that we haven't had as
broad consultation as one might often have. We started this process
I guess in early October. I would say actually around November 26th
is when we decided on some form of the Social Security first plan.
However, this is technical and we wanted to play through every option
and we locked this in in the beginning of January.
After that, the President called in a variety of
different members and asked their views on surplus and Social
Security. And I think we felt very confident after hearing that,
from the things they were saying, that they would at least feel that
our proposal was very consistent with what they want. I think that
many -- I'm very hopeful that many Democrats and Republicans will
think this is a wise thing to do. But this is something the
President felt very strongly about, the Vice President felt strongly
about, his economic team felt strongly about. And this is the policy
we believe in.
But I think that we have -- from what we've heard in our
conversation with people, I think we have good reason to believe that
this will have a strong degree of support.
Q Gene, a technical question on this. Does this
mean, then, that you need some legislation, because if you just let
the surplus accumulate in the absence of an appropriation it will go
toward the debt. So do you have to ask Congress to create -- is this
like an escrow fund?
MR. SPERLING: Two parts -- I'm going back. If as part
of Social Security reform you wanted to use some of the surplus for
Social Security --
Q No, no, stop. You're going ahead. The surplus
starts; you're going to say this tonight; money is coming in; you're
putting it in a separate fund -- I mean, be a bookkeeper a second.
Do you need legislation to keep this money untouchable so it doesn't
go into the debt? Because you have said if nothing happened it would
go towards the debt.
MR. SPERLING: I think that if what you're talking about
is a few billion dollars of surplus -- which is probably the most we
project over the next couple of years -- I don't know if it -- I
think that the fact that it would go to paying down the debt it would
still essentially be saved is a -- would not be a major problem.
I think the question is if there were larger surpluses
that looked like they were going to accumulate more than we thought,
then if we decided at that time we wanted to in some way save them,
then I think, yes, we would need some form of legislation. We have
not crossed that bridge because we are hopeful we won't have to.
We're hopeful that we'll be able to have Social Security reform
before a significant amount of surplus starts to accumulate.
Q Why will it take a year, then? Is it to get it
past the election?
MR. SPERLING: I think that we have -- I have personally
consulted with almost every group that's interested in Social
Security reform about how they looked at the coming year. There was
remarkable consensus on the following: that Social Security reform
would never pass unless the issue was elevated and raised at a high
level. And that, secondly, if it became politicized too quickly,
before Americans were informed about it, if people started taking off
options and taking untenable positions prior to the election, that
that would make it difficult in a post-election period to have the
kind of bipartisan atmosphere.
So I think that we -- I think that, obviously, if things
were to come together in a way that we had an opportunity to address
this problem this year, and things worked out that way, we would
obviously support that. But it is the opinion of almost everybody
dealing on this issue across the board that the best way to proceed
is to try to educate people and keep people from politicizing this
issue and taking options off the table during this period, so that
following the election we would have the kind of atmosphere where the
options are open, where people are still working together and we
might have the type of atmosphere we had in '97, where we could do
something.
And that is why the President has taken the extra effort
of rather than us simply hosting forums ourselves, of getting two
groups that we think together people will trust, we'll be able to
present a balanced and bipartisan presentation.
Q Gene, in his speech will he use any sort of
empirical evidence to make this point? I mean, how much of a
shortfall and how many people are we talking about who would -- the
system, as it stands now, if we do nothing would be left out of
getting benefits?
MR. SPERLING: I think just in terms of words on the
speech, I think that he's going to go -- honestly, it was more wordy
at a while, and I think that, as you'll see, the President, Saturday
-- Saturday, the President cut out a lot of fine language.
SENIOR ADMINISTRATION OFFICIAL: Very expensive
language, he cut out. (Laughter.)
MR. SPERLING: And I think he goes more quickly to it
and he tries to focus more on the surplus and what's best to do with
it. So I don't think that you'll see an exposition of the trust fund
goes bankrupt in this year. But what we've done is set up a
process --
Q So you don't have any chart information for me is
what you're saying?
SENIOR ADMINISTRATION OFFICIAL: No, President Perot did
not bring his charts. (Laughter.)
MR. SPERLING: We could provide you with some of that
information. He's not going to go into all of that in his speech
tonight.
Q It's the President's centerpiece of the speech,
though; is that correct?
MR. SPERLING: I think that we have -- I mean, we
started early on this in October because this was always our plan.
Our plan was always that we could have a major statement on surplus
and Social Security at this time. The meetings in my office were
very cramped, but we kept them there -- we kept them there, we had
good coffee. But we kept a tight lid and we had a small group that
worked on it. We met about five times with the President, probably
starting in October, and closed in -- we had the last two meetings I
guess the first two Mondays we were back in January.
Q -- three or four key facts that substantiate the
threat that you're addressing with this proposal?
MR. SPERLING: Well, in the year 2012, the amount of
money coming in on a cash flow basis -- she's checking me --
SENIOR ADMINISTRATION OFFICIAL: All right, I like that.
(Laughter.)
MR. SPERLING: -- my colleague is checking me, I'm
getting my grade -- on a cash flow basis will start to be less than
that that has to be paid out for benefits. Then by 2019 it becomes
less than is accumulating in -- what's being paid out becomes less
than what is coming in, plus the interest. And at that point the
trust fund, itself, starts going down until the year 2029, in which
there is then -- then the trust fund is depleted.
Q 2019?
SENIOR ADMINISTRATION OFFICIAL: 2029.
MR. SPERLING: That's right.
Q Will there be anything left in the trust fund by
2029?
MR. SPERLING: No.
SENIOR ADMINISTRATION OFFICIAL: No, it's depleted. But
there are still revenues coming into the system, of course. And
estimates are that those revenues would be sufficient to pay 75
percent, roughly, of promised benefits, even after the trust fund is
depleted.
Q If you could put every penny you needed today --
Q Between 2012 and 2029 you expect 75 percent of
benefits?
SENIOR ADMINISTRATION OFFICIAL: No, I'm sorry. In 2029
the trust fund is depleted. And if absolutely nothing were done at
all until that moment -- which, of course, is the opposite of what we
anticipate -- come 2029, I'm saying there would still be sufficient
revenue flowing into the fund to pay 75 percent, roughly, of promised
benefits.
Now, we want to see action taken early. I'm just trying
to scale what happens in 2029 in the absence of any type of --
Q Robert Reich said recently that those projections
are not correct, because it's based on too pessimistic growth
estimates.
MR. SPERLING: What's that?
Q Robert Reich said recently that the projections
that it would go bankrupt are non-accurate because they're based on
growth estimates that are too pessimistic.
MR. SPERLING: There's a lot of confusion about the
long-term growth number, because as my colleague has taught me, the
GDP growth is a combination of both productivity growth and the
increase in the work force. And what a lot of people don't realize
is because there are projected to be virtually no growth in the work
force, people who say, well, the economy could grow three percent or
something at that time are actually then talking about a full three
percent productivity growth -- which is exactly the kind of absolute,
wild, optimistic assumptions that got us into this trouble in the
first place. We've had conservative assumptions the last five years
and this economy has benefitted strongly from it.
Q Gene, is this a concession that Social Security
--that you're going to have to pay something to repair it, that it
can't repair itself.
MR. SPERLING: You bet.
Q And, also, is this a big enough program, this
announcement tonight, along with the other 49 points in the speech,
to grab the nation's attention away from the sex scandal?
MR. SPERLING: I would be surprised if there is much
that makes people stop caring about Social Security, that makes
people stop being worried about whether they have health care, the
education of their kids or whether there's a threat from Iraq, or
about crime, or about the environment. I mean, these are the things
people care about. These are the things the President was elected to
deal with .
And I think this is perhaps the most interesting speech
that we've given, because I think the issues -- from cloning to
Social Security to Iraq -- are interesting; and I think they are the
important things people care about and I think the speech will go
over very well.
Q How long do you expect it to be?
Q Is that on the record, Gene? Can we use that?
MR. SPERLING: Sure.
SENIOR ADMINISTRATION OFFICIAL: It should run at or
under an hour -- if the over and under is at an hour, I would bet
under.
Q Is it still the President's intention not to
mention in any way the scandal?
SENIOR ADMINISTRATION OFFICIAL: Right. Yes.
Q Just a couple specific questions on some of these
other proposals. In the Juvenile Justice Crime Bill, the measure
that I gather would -- I gather from what you say in here, you
wouldn't let kids who were juvenile delinquents buy guns when they're
21?
SENIOR ADMINISTRATION OFFICIAL: It would extend the
Brady Bill down.
Q Okay. So is that a new proposal, or has he said
that?
SENIOR ADMINISTRATION OFFICIAL: I don't know. Gene,
has he been asked that before?
MR. SPERLING: What's that? I'm sorry.
SENIOR ADMINISTRATION OFFICIAL: The juvenile gun
provision. We're getting into --
MR. SPERLING: My colleague's issue.
SENIOR ADMINISTRATION OFFICIAL: I'm sorry, I don't
know. We can find out.
Q And also on the environmental, the global climate
change, is he going to sort of do some preaching on that? I mean, is
he going to urge -- I mean, can you kind of characterize how he's
going to talk about --
MR. SPERLING: What he's going to remind people is that
virtually every time in this country there's been an effort to make a
major environmental reform or improvement, people have said the
economy would go under, all sorts of bad things would have happened.
And he's going to point out that at every stage we have been able to
pass the Clean Air Act, the Clean Water Act.
And where are we after all the dire predictions? We
have the lowest unemployment and inflation in 30 years and we have
probably the strongest economy in a generation. So I think he'll
make very strongly the point that there's compelling science, that we
need to deal with this and that we've always heard the dire
predictions and we've always found a way to both grow the economy and
improve the environment.
Q What will the President say about the Asian
financial crisis? Will he say more than we have to pay the IMF so we
have to conduct its bail-out?
MR. SPERLING: He is going to speak to that and he is
going to -- it's obviously a complex issue, but he's going to try, in
very plain language, to tell people why what's happening there
matters to us, why the fact that currencies are falling could mean
that there are goods coming in at lower prices that could have some
disruptive effects here, why it could hurt our ability to export; but
that it is in our interest, when countries are willing to take the
tough measures of reforms, that it's in our interest to give them the
opportunity to at least try, because of the interdependence between
the strength of their economies and the strength of our economy.
Q Anything specifically on the role of Japan, in
restoring stability to Asia, as Bob Rubin did in his Georgetown
speech and Tom Foley, Ambassador to Japan, did in Tokyo?
MR. SPERLING: This is going to be a two-hour speech by
the -- (laughter.)
Q Would you go on the record with one of your quotes?
Perhaps the, it's much more old-new rather than left-right?
Q And the Clintonism --
MR. BEGALA: That's fine.
Q Gene, what are we going to hear on minimum wage,
please?
MR. SPERLING: The President is going to announce today
that he is going to increase the minimum wage. But we are going to
wait until -- I don't want to lock us in, but maybe next week, how's
that -- to announce the number. He's not going to announce our
specific proposal today, only that we are going to call for an
increase in the minimum wage.
Q Back about Iraq --
SENIOR ADMINISTRATION OFFICIAL: He's made America's
position on it very clear and I think you'll see a very clear
restatement of it.
Q I mean, what information -- use today to reaffirm
his position -- more specific --
SENIOR ADMINISTRATION OFFICIAL: I think you'll see
tonight a firm restating of our position.
Q Gene -- IMF funding issue?
Q I'm sorry, could you finish what you were saying,
please, about Iraq?
SENIOR ADMINISTRATION OFFICIAL: -- our position very
clear.
MR. SPERLING: -- mention as part of the Asian finance
crisis. I really have to go.
Q Can we put on the record, this is the best kept
secret we ever had, Gene? Is that okay?
MR. SPERLING: What's that?
Q This is the best kept secret we ever had -- that's
on the record? All in favor, all opposed? (Laughter.)
SENIOR ADMINISTRATION OFFICIAL: Gene and his team kept
this quiet for three or four months.
MR. SPERLING: You can use anything I said on the
record.
END 3:52 P.M. EST |
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