Software Vault: The Gold Collection/Software Vault - The Gold Collection (American Databankers) (1993).ISO/cdr11/wh930624.zip/06-24C.TXT

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From @lex-luthor.ai.mit.edu:[e-mail]  Thu Jun 24 12:19:55 1993
Date: Thu, 24 Jun 1993 10:45-0400
From: The White House <[e-mail]>
To: [e-mail],
Subject: Briefing by OMB Director Panetta  6.23.93



                           THE WHITE HOUSE

                    Office of the Press Secretary

_____________________________________________________________________
For Immediate Release                                   June 23, 1993

                            PRESS BRIEFING
                                  BY
                      OMB DIRECTOR LEON PANETTA


                          The Briefing Room

5:49 P.M. EDT

         MR. PANETTA:  The purpose here is we've done a
preliminary analysis of the Republican substitute that is currently
being debated, I believe, on the Senate floor as we speak.  And I
wanted to report to you that as a result of our preliminary analysis,
that there's bad news and then there's bad news.

         The first bad news is that it is basically what we
expected in that it rejects the fundamental fairness that we thought
was essential to a balanced approach to deficit reduction.  What's
happened is the Republicans basically stepped back to trickle-down
economics.  And they have ridden to the rescue of the wealthiest
individuals in this country and sacrificed the middle class in the
process.

         What they've done here essentially is proposed another
$100 billion in discretionary reductions, another $50 billion in
entitlement reductions, so that they're fully prepared to cut
education; to cut transportation; to cut housing assistance; to cut
law enforcement officers; to cut the FBI; to cut immigration; to
continue to put the burden of this program on farmers and veterans,
on retirees, on Social Security recipients.  And at the same time
that they're prepared to demand that sacrifice from every American in
this country, they're saying that those who earn over $200,000 we're
going to protect -- they don't have to contribute to this effort to
reduce the deficit.

         That is the kind of fundamental unfairness that we think
the voters rejected in the November election.  That's what the '80s
were all about.  And I think it's essentially what our plan tried to
redirect in terms of this country.  Basically the plan that was
presented by the President said we've got a tremendous problem here
in terms of deficit reduction.  And in order to meet this $500
billion deficit reduction, we need everyone in this country --
everyone in this country -- to participate in that effort.

         The Republicans have said, yes, everyone's going to
participate except those who are the most privileged in our society.
And I think the public has rejected that, we reject that, and we
think the Senate will reject that.

         But they also did what we did not expect in this
proposal, which is that the Republicans went eyeball to eyeball with
the deficit and they blinked.  Instead of coming up with $500 billion
in deficit reduction, they came up with almost $100 billion, over
$100 billion less.  They're at about $411 billion, as we understand
their proposal.

         Now, they argue that at some point they basically meet
our deficit target, but the problem is that they add another $100
billion to the national debt in this country.  When you don't do $500
billion in deficit reduction, you're essentially saying we're willing
to increase the debt in this country by another $100 billion.  And
that's essentially what they have done here again on the basis that
they are trying to protect the most privileged in this society.

         Now, the other issue I should point out, and it's
something we've heard over the last few days in terms of the attack
on the plan, that essentially they were attacking us because we were
counting interest savings; because we were counting fees; and because
we were counting discretionary savings.  And now we find that in
their plan, they have counted interest savings; they've counted fees;
and they've counted discretionary savings.  And they still have come
out with $100 billion less in terms of deficit reduction.

         So the bottom line is that we think that this plan makes
even clearer to the American people why the President's economic plan
is really the only game in town.  And it's the only game in town
because it is fair, it is balanced, demands that every American
participate in this effort.  And it does it in a progressive way, and
it does it in a real way without gimmicks.

         I would also mention with regards to the approach they
used to achieve their entitlement savings, they used what's called an
entitlement cap, which means essentially that they do not make
specific recommendations as to how those savings are achieved.  And,
again, we have always said to the American people if you're going to
talk about deficit reduction, be honest with them and tell them how
these savings are going to be achieved.  The plan that they have
presented is not honest with the American people in terms of those
specific savings.

         So in the end, we think that the plan falls way short,
the Republican plan falls way short, of not only achieving legitimate
deficit reduction, but it sends the wrong message to the American
people.  The message is:  It's okay to go back to what we did in the
'80s; it's okay to go back to trickle-down economics.  And that we
rejected a long time ago.  And, frankly, the purpose of this
administration is basically to send us in a new direction.  We would
welcome Republicans, frankly, if this is all they have to offer, we
think that we would welcome them coming over to the Democratic
alternative, our plan, and supporting that, because, frankly, it's
the only way we're really going to achieve deficit reduction in this
country.

         Q      Have you gotten any indication of Republican
defections?

         MR. PANETTA:  I would have to believe that some of my
Republican friends would have to be very concerned with this kind of
approach.

         Q      When did you first get the plan?  When did you
first see it?

         MR. PANETTA:  We just got copies of it, I guess, based
on the release that they made up on Capitol Hill; so we've just taken
a look at it.  Obviously, OMB and Treasury are going to do a more in-
depth analysis for tomorrow morning.  But by that time it may not be
necessary.  I don't think the Senate's going to buy this plan.

         Q      You call it bad-bad.

         MR. PANETTA:  Bad, bad.

         Q      Where's your attack now?

         MR. PANETTA:  Pardon me?

         Q      Who's going to counteract the bad, bad?  How are
you going to counteract?  What's your plan now to sell this to the
American --

         MR. PANETTA:  Listen, I think, -- one of the problems
we've always had in this whole process is trying to get across why we
think this plan that the President presented to the country is the
right plan for the country.  And when they present their
alternatives, when Senators Boren and Danforth presented their
alternatives and you saw that if you want to do something different
you had to dig deeper at Social Security recipients; and when others
decided that -- the Republicans now decided they wanted to offer
their alternative and the public can see the real meat in their
alternative, that helps us, very frankly; because I think the public
basically says that the President's plan is fair and it is right and
it's the best way to approach deficit reduction.  And I think,
frankly, I welcome these alternatives.  We have always said put up or
shut up.  They've put up, and I think the end result is, frankly,
that it makes our plan look that much better.

         Q      Mr. Panetta, why isn't it legitimate for the
Republicans to put forward a plan that offers fewer government
services but no new taxes?  Why isn't that legitimate?  I mean, you
can disagree with it but why isn't that a legitimate approach to
that?

         MR. PANETTA:  They are free to present whatever proposal
they want, and they have.  My argument does not go to the fact of
whether or not they should have every right to present this
alternative.  I welcome this alternative.  But I think it's wrong for
the country and I think it does exactly what we have been fighting
against in terms of fair balance to deficit reduction.  You cannot
continue to place the bulk of the burden for deficit reduction on
those in the middle.  I mean, if you're going to deal with this debt
and the deficit everybody's got a share in it.  Everybody's got a
share in it.  That's been the fundamental message we've tried to send
with our plan.  And I think the American people understand that.  If
there's anything they're going to reject is the fact that the
Republicans are essentially saying you're the ones that ought to bear
the biggest burden on these cuts, and we are going to protect those
at the upper income level for some strange argument that somehow we
just don't want any taxes whatsoever.  That doesn't make any sense to
me, and I don't think it makes sense to the American people either.
And, frankly, I don't think it makes sense to a lot of good
Republicans.  I really don't.

         Q      Mr. Panetta, what's the state of play on the Senate
floor now?  Do you have the votes to pass the Senate Finance
Committee plan or are you still trying to get them?  What's the
situation?

         MR. PANETTA:  I would think that what the Republicans
have offered here just gives us that much more momentum for the
President's plan.  We're working it.  It's still going to be a tough
vote.  But I'm confident that we can win it.

         Q      What do you say to Senator Gramm and other
Republicans who argue that the wealthiest already do pay their fair
share in taxes -- they're paying the most -- the highest rates
already; and that if you tax them more, hundreds of thousands of jobs
supposedly will be lost and the middle class and the most needy will
suffer because of this increase in taxes on the wealthy?

         MR. PANETTA:  I think the answer to them is the obvious
argument that the deficit remains our biggest problem that needs to
be confronted.  That if we don't deal with the deficit, then we're
going to continue to impact on jobs and growth in this country.  If
we deal with the deficit, we will provide the kind of investment, the
kind of low interest rates that are going to help jobs and growth and
our economy.  That's been the fundamental principle behind reducing
the deficit.

         To argue that now in the process of dealing with the
deficit not every American ought to participate in that effort, I
think is to send exactly the wrong kind of message to the American
people.  I think the wealthy -- frankly, if you want to know the
truth, I think the wealthy understand that they, too, have a role to
play in the American society.  This is not a game of class war.  It
really isn't.  This is a game of fairness.  And whether or not
everyone in this society -- this democratic society -- is going to
share in the sacrifice involved with dealing with the deficit --
that's the fundamental question.  And I think when you ask anybody
that question, they're going to say we're willing to participate.

         Q      What's your prediction now of what's going to
happen?  And will there be a vote -- final vote tomorrow night?

         MR. PANETTA:  I think we'll reach hopefully a final vote
by tomorrow evening -- late tomorrow evening.

         Q      And will it be the President's plan?

         MR. PANETTA:  They're working pretty good at it and
they're working amendments on the Senate floor right now.  And I
think we had -- frankly, my first thought was that they were going to
engage in more debate initially, but they're going right to the
amendments, and I think as a result I feel a lot better about the
possibility of trying to wrap this up by tomorrow night.

         THE PRESS:  Thank you.

                                 END6:00 P.M. EDT