[Public Papers of the Presidents of the United States: William J. Clinton (1995, Book I)]
[February 6, 1995]
[Pages 163-165]
[From the U.S. Government Publishing Office www.gpo.gov]

Remarks on the 1996 Budget
February 6, 1995

    Good morning. Today I am pleased to announce our administration 
budget for fiscal year 1996. This budget, of course, is not a beginning 
but a continuation, the next important step in our coordinated economic 
strategy to bring discipline back to Government and to help strengthen 
the American dream for all of our people.
    I want to thank the economic team which has worked so hard to put 
this budget together. The Vice President, Secretary Rubin, CEA Chair 
Tyson, and Director Rivlin will talk today, but there are others who 
have also worked very, very hard on this budget.
    This budget, like the two that preceded it, is based on the New 
Covenant I advocated when I ran for President. We're creating a leaner, 
not a meaner, Government, one which offers more opportunity to those who 
are taking responsibility for themselves, their families, and their 
    None of this was being done when we came here 2 years ago. At that 
time, we faced slow economic growth, inadequate investment, very low 
levels of job creation, a deficit that was nearly $300 billion and 
projected to go over $400 billion a year by the end of the decade. The 
annual deficit and the total national debt had quadrupled in the 12 
years before I took office.
    In 2 years, we have turned that around. In 1993, we passed the 
single largest deficit reduction package in American history, reducing 
the deficit over 5 years by $505 billion. When you take into account 
improved performance of the economy and reduced interest rates in 1993, 
the deficit reduction will exceed $600 billion over this 5-year period.
    We did it by returning something to Washington that had been missing 
for too long, real discipline and honest numbers in the budgeting 
process. We did it, unfortunately, last year and the year before without 
any votes from members of the other party. And I hope now we will be 
working together to keep the deficit under control and keep the economic 
growth going.
    We cut the Federal Government by more than 100,000 positions in the 
last 2 years. We're on the way to reducing it, with laws already passed, 
by 272,000 positions, making it the smallest it's been in more than 30 
years. We cut taxes for 15 million working families, with 40 million 
Americans in it, about an average of $1,000 apiece for families of four 
with incomes under $26,000 this year. We made 9 of 10 of our small 
businesses eligible for tax reductions. We invested in the tools our 
people need, in education, in training and technology. We did more to 
open markets in the last 2 years than in any previous period in a 
    The results are clear. The deficit that 2 years ago was projected to 
be over $400 billion a year by the end of the decade is now under $200 
billion. It's going down for 3 years in a row for the first time since 
Truman was President. The economic plan we have already passed will cut 
the deficit in half as a percentage of our economy. We have almost 6 
million new jobs, the biggest year in economic growth in 1994 in a 
decade, with 93 percent of those jobs in the private sector. That's the 
largest percentage of private sector job growth in 50 years. We have the 
lowest combined rate of unemployment and inflation in 25 years. I am 
proud of this record, and the budget we send today builds on that 
    In the third year of our strategy we are adding $81 billion more to 
deficit reduction. That's nearly $600 billion in real deficit cuts. And 
in addition to that, of course, there is more, as I said, coming as a 
result of the economic growth of the last 2 years.
    This budget provides more than a dollar in deficit reduction for 
every dollar that goes into the tax cuts I will discuss in a moment. If 
Congress gives me the line-item veto, I will find even more cuts.
    The budget already provides $144 billion in hard budget savings. 
Behind me, you can see in black and white the 400 programs that this 
budget will eliminate or consolidate: the termination of about 130 
programs here and over here, the consolidation of 270 more--those 271 
programs will be distilled down into 27. We are also restructuring five 
major agencies as part of the second round of reinventing Government the 
Vice President will discuss in a moment, to save $23 billion. And our 
reinventing Govern-

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ment effort is looking at all the other agencies for further 
opportunities that might emerge in the course of the budget debate this 
    Now, we're not cutting Government blindly. We're clearing away 
yesterday's Government to make room for the solutions to the problems we 
face today and tomorrow. We still have to keep investing to raise the 
living standards of our people. Despite all the progress we have made, 
there are still too many Americans who are working harder for less. 
That's why the centerpiece of this budget for me is the middle class 
bill of rights. It will help keep the American dream alive for everyone, 
by lowering taxes in ways that encourage investment in the future. It 
will increase the incomes of people who have not benefited from this 
recovery in both the short term and the long term.
    There are four provisions: first, a tax deduction for the cost of 
education and training after high school; second, a $500 tax cut for 
children under 13; third, the ability to put money into an individual 
retirement account and withdraw the money tax-free for education, for 
health care costs, for the care of an elderly parent, for the purchase 
of a home for the first time; and fourth, the proposed ``GI bill'' for 
American workers, which collapses 70 Federal training programs, gets rid 
of the bureaucracy that goes with them, and instead gives a voucher 
worth $2,600 a year in cash to workers who are unemployed or who have 
low wages and are eligible for Federal training assistance so that they 
can take the money to the nearest approved training program that they 
    This budget also continues our investments in other crucial areas, 
from education and training, including more money for Head Start and our 
investments in technology and our continued expansion of the national 
service program, which has done so much good in a completely 
nonbureaucratic way. It strengthens our fight against crime. It does not 
cut overall spending from the commitments of the crime bill last year. 
And it provides the most comprehensive immigration plan to fight illegal 
immigration that any administration has produced. It stiffens our 
enforcement. It increases our capacity to deport illegal immigrants, 
particularly those who commit crimes. It increases our ability to move 
in the workplace and to identify those who are in the workplace who 
should not be.
    It provides critical resources to keep America engaged in the world. 
And it helps us to continue to maintain the finest military in the 
world. As all of you know, a few weeks ago I asked that we increase 
defense spending over the next 6 years by $25 billion to improve our 
training and quality-of-life components in the Department of Defense 
budget. We need to do that to support a strong and steady military.
    This budget supports our efforts to reduce the risk of nuclear war 
and the proliferation of weapons of mass destruction. It provides 
funding to promote peace and to maintain democracy and free markets in 
crucial places throughout the world. It provides funds to continue our 
efforts to break down barriers to the international trading system, 
which mean more and better jobs if we succeed.
    The only way to make these investments in our future is to make 
tough choices, and this budget makes them specifically and clearly. 
Every single one of these proposals is paid for with specific spending 
cuts. Anyone can offer a tax cut or propose investments. The hard part, 
of course, is paying for them.
    I challenge the leadership of the Congress to do what we have done, 
to provide the taxpayers with specific and real details about the 
proposals they make, and then to work with us to get a budget that 
furthers the interests of all the American people.
    Americans deserve to know. It is their futures, their families that 
are at stake. They deserve to know what will happen to programs they 
care about, like Social Security and Medicare; what their opportunities 
will be for educating their children and whether they'll be enhanced or 
reduced; what we're doing about the poorest and most vulnerable children 
in our society--are we increasing our investment in their Head Start, in 
their nutrition programs, or not?
    My budget cuts spending, cuts taxes, cuts the deficit, and does not 
cut education or Social Security or Medicare. That is a good budget. It 
continues to reduce the deficit without undermining the things that I 
believe the Federal Government should be doing. And I wish to work with 
the new Congress to achieve these objectives. I hope that they will 
submit budgets which do the same.
    Our test should be, as we go into this budgeting process: Do our 
decisions expand opportunities and incomes for the vast mass of middle 
class Americans? Do our decisions promote the values of responsibility 
and family and community? Do our decisions contribute to strengthen-

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ing the American economy in the new global economy? If we propose a tax 
cut, have we paid for it?
    I am proud to say that this budget meets all those tests. And I call 
on the 104th Congress to give it serious consideration and to enact it.
    Now I'd like to ask the Vice President to come forward and talk 
about the specific cuts and consolidations that we have recommended.
    Thank you very much.

Note: The President spoke at 10:35 a.m. in Room 450 of the Old Executive 
Office Building.