Bill Clinton: “But we are cutting spending. And if all you had was spending cuts, you would have a deficit reduction package in the…”

“But we are cutting spending. And if all you had was spending cuts, you would have a deficit reduction package in the neighborhood of $250 billion to $260 billion which no one--which the financial markets would not take seriously and interest rates would be 2 percent higher and all these people refinancing their home and saving a ton of money on it wouldn't be saving it. In other words, let me give it to you in another way. We are cutting spending. We're going to cut more spending. But you'd be amazed how many of those same people, when you say, ``Okay, all the growth is in Medicare and Medicaid. You want me to cut Medicare?''--they say, ``No, don't do that.'' I mean, there are people who believe that all the Federal budget goes to welfare and foreign aid--which is something we cut, by the way, foreign aid--which is a tiny percentage of the total overall budget of the Federal Government. We are--this administration, not the two previous ones--that's really got the serious attempt going to reduce the Federal bureaucracy and to change the way the Federal Government relates to people. That's what the Vice President is working on, and we'll have our report out next month. But we don't have time to fool around. Let me just make one final point about this. David Stockman, who was Ronald Reagan's Budget Director when the '81 tax cuts were enacted, gave an interview last month in which he said it was folly to believe we could balance the budget on spending cuts alone, because in 1981 President Reagan intended to cut taxes 3 percent of national income. And by the time he and the Congress got through with their bidding war, they had cut them 6 percent of national income, so much that some companies couldn't even handle all their tax cuts. They were selling them to others. And he said, ``That has to be reversed.'' That's what I'm trying to do. And you know, let me just point out for all those people who think I'm a taxaholic, for 12 years I was Governor of a State that was always in every year in the bottom five of the States in the country in the percentage of income going to State and local taxes, in every year. We had the toughest balanced budget law in the country, and the only time we raised money was when a majority of the people of my State supported it, and the money went to schools or roads. We didn't do anything but education and jobs with new taxes. In the late eighties, the percentage of our income going to taxes in Arkansas was the same as it was in the late seventies when I became Governor. But when you get up here, you see the problems we've got and you see how long they've been ignored. And keep in mind, families with incomes under $30,000 are going to be held harmless. Families with incomes between $30,000 and $140,000 are going to be asked to pay very modest amounts. The average payment for a family of four with a $50,000 income is $50 a year. To get this deficit under control, I think it's worth it. If the people don't think so, they can tell their Congressman. But the idea that there are no spending cuts in this thing is simply not true. The spending cuts have not been controversial, so they have not been reported, so people don't think they exist. But they do exist. Legislative Action”