Bill Clinton: “Well, there are a lot of tax cut proposals around, as you know, in the Congress. And the Republican contract calls for…”

“Well, there are a lot of tax cut proposals around, as you know, in the Congress. And the Republican contract calls for several hundred billion in tax cuts. I can't remember the exact figure. There's already been a bill introduced to cut income taxes 20 percent across the board. The first thing I want to say is that I think we need more tax fairness in the Federal Tax Code, we need to give hard-working middle class people a dividend from the end of the cold war and the dramatic downsizing of the Federal Government that is going on. They haven't really received it yet. And I think that's very, very important. I also think, however, that most hard-working Americans have a vested interest in seeing us keep this deficit under control. In a couple of years, interest payments on the debt will be greater than the defense budget because of the explosion of debt that grew up between 1981 and 1993, when the Federal deficit, national debt, was quadrupled. We cannot continue on that track. I'm trying to turn it around in the other way. I don't think people ought to be spending over 20 percent of their income tax payments every year just paying interest on the debt that was piled up in that period. So while I favor a middle class tax cut and I don't rule out working with the Republican Congress on some of their ideas, my standard will be: Will it help increase incomes for the middle class, will it promote jobs and growth, and can we pay for it? That will be my standard. If we do it in that way, I think that the municipalities will be all right, except that we're going to have to cut a lot of spending up here. And especially, I would urge our friends in the National League of Cities who are in the Republican Party, to make sure that the Congress understands what the consequences are of all these budgetary decisions. I can't predict what will happen. All I can tell you is, I want better tax fairness, I want to do something that increases middle class incomes, I want a dividend from the end of the cold war and the downsizing of the Federal Government. We made a beginning last year, by the way, when we cut taxes on 15 million working families, with 50 million people in them, with incomes of up to $27,000. But we have to do more. I think there's a way to do it in ways that will actually help the economic climate of our cities, by putting more money into the pockets of your citizens, if we do it with real discipline and care. But again, as you implied in your question, there are consequences to all these decisions, especially if we're going to be disciplined and pay for them. So I would say that the National League of Cities ought to ask to be a partner with Congress in the decisions about how the taxes are going to be cut and what the implications for the cities are. I hope you will ask for that partnership, and our door will always be open to you. Thank you.”