Angie Craig: “President Clinton outlined the many challenges facing this Nation in his State of the Union Address. Paramount amongst…”

“President Clinton outlined the many challenges facing this Nation in his State of the Union Address. Paramount amongst those challenges was the need to bring fiscal responsibility back to the Congress and the Federal Government. I appreciate the President's acknowledgement of the need to balance our budget. In this same speech, coupled with the challenges that we face as a nation, the President outlined his proposed action to assist our neighbors in Mexico. The Congress will soon be faced with a vote on whether to support this proposal, which will provide Mexico with $40 billion in loan guarantees. The purpose of the loan guarantees is to reschedule overextended short-term maturities, assisting Mexico through what is now a difficult financial situation. With our current budgetary problems, I cannot support the exposure of my fellow American taxpayers to the tune of $40 billion in loan guarantees as initially proposed by President Clinton. Mr. President, as the administration and Congress struggle with this fiscal crisis, I am concerned that we are overlooking many important factors. Mexico's financial situation seems to be the result of past policy decisions, not external factors outside of Mexican control. The Mexican Central Bank, in an attempt to hold interest rates down, printed a huge excess of pesos. By creating excess pesos, Mexico undermined the exchange rate and drove many investors away. The devaluation was forced by bad monetary policy.”