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    The following is the text of the 3d Presidential debate
 in East Lansing, Mich, Monday, Oct 19.
    JIM LEHRER: Good evening. Welcome to this 3d and final
 debate among the 3 major candidates for president of the US.
 Governor Bill Clinton, the Democratic nominee, President
 George Bush, the Republican nominee,--
    (Applause)
    --and independent candidate Ross Perot.
    (Applause)
    I am Jim Lehrer of the MacNeil-Lehrer Newshour on PBS. I
 will be the moderator for this debate, which is being
 sponsored by the Commission on Presidential Debates. It will
 be 90 minutes long. It is happening before an audience on
 the campus of Michigan State University in East Lansing.
    The format was conceived by and agreed to by
 representatives of the Bush and Clinton campaigns, and it is
 somewhat different than those used in the earlier debates. I
 will ask questions for the first half under rules that
 permit follow-ups. A panelist of 3 other journalists will
 ask questions in the 2d half under rules that do not.
    As always, each candidate will have 2 minutes, up to
 2 minutes, to make a closing statement. The order of those,
 as well as that for the formal questioning, were all
 determined by a drawing.
    Gentlemen, again welcome and again good evening.
    It seems, from what some of those voters said at your
 Richmond debate, and from polling and other data, that each
 of you, fairly or not, faces serious voter concerns about
 the underlying credibility and believability of what each of
 you says you would do as president in the next 4 years.
    Governor Clinton, in accordance with the draw, those
 concerns about you are first: you are promising to create
 jobs, reduce the deficit, reform the health care system,
 rebuild the infrastructure, guarantee college education for
 everyone who is qualified, among many other things, all with
 financial pain only for the very rich. Some people are
 having trouble apparently believing that is possible. Should
 they have that concern?
    GOVERNOR CLINTON: No. There are many people who believe
 that the only way we can get this country turned around is
 to tax the middle class more and punish them more, but the
 truth is that middle-class Americans are basically the only
 group of Americans who've been taxed more in the 1980s and
 during the last 12 years, even though their incomes have
 gone down. The wealthiest Americans have been taxed much
 less, even though their incomes have gone up.
    Middle-class people will have their fair share of
 changing to do, and many challenges to face, including the
 challenge of becoming constantly re-educated.
    But my plan is a departure from trickle-down economics,
 just cutting taxes on the wealthiest Americans and getting
 out of the way. It's also a departure from tax-and- spend
 economics, because you can't tax and divide an economy that
 isn't growing.
    I propose an American version of what works in other
 countries--I think we can do it better: invest and grow.
    I believe we can increase investment and reduce the
 deficit at the same time, if we not only ask the wealthiest
 Americans and foreign corporations to pay their share; we
 also provide over $100 billion in tax relief, in terms of
 incentives for new plants, new small businesses, new
 technologies, new housing, and for middle class families;
 and we have $140 billion of spending cuts. Invest and grow.
    Raise some more money, spend the money on tax incentives
 to have growth in the private sector, take the money from
 the defense cuts and reinvest it in new transportation and
 communications and environmental clean-up systems. This will
 work.
    On this, as on so many other issues, I have a fundamental
 difference from the present administration. I don't believe
 trickle down economics will work. Unemployment is up. Most
 people are working harder for less money than they were
 making 10 years ago. I think we can do better if we have the
 courage to change.
    LEHRER: Mr. President, a response.
    PRESIDENT BUSH: Do I have 1 minute? Just the ground rules
 here.
    LEHRER: Roughly 1 minute. We can loosen that up a little
 bit but go ahead.
    PRESIDENT BUSH: Well, he doesn't like trickle down
 government but I think he's talking about the Reagan-Bush
 years where we created 15 million jobs. The rich are paying
 a bigger percent of the total tax burden. And what I don't
 like is trickle down government. And therein, I think
 Governor Clinton keeps talking about trickle down, trickle
 down, and he's still talking about spending more and taxing
 more.
    Government--he says invest government, grow government.
 Government doesn't create jobs. If they do, they're
 make-work jobs. It's the private sector that creates jobs.
 And yes, we've got too many taxes on the American people and
 we're spending too much.
    And that's why I want to get the deficit down by
 controlling the growth of mandatory spending. It won't be
 painless. I think Mr. Perot put his finger on something
 there. It won't be painless but we've got to get the job
 done. But not by raising taxes.
    Mr. and Mrs. America, when you hear him say we're going
 to tax only the rich, watch your wallet because his figures
 don't add up and he's going to sock it right to he middle
 class taxpayer and lower, if he's going to pay for all the
 spending programs he proposes.
    So we have a big difference on this trickle down theory.
 I do not want any more trickle down government. It's gotten
 too big. I want to do something about that.
    LEHRER: Mr. Perot, what do you think of the governor's
 approach, what he just laid out?
    PEROT: The basic problem with it, it doesn't balance the
 budget. If you forecast it out, we still have a significant
 deficit under each of their plans, as I understand them.
    Our challenge is to stop the financial bleeding. If you
 take a patient into the hospital that's bleeding arterially,
 step one is to stop the bleeding. And we are bleeding
 arterially.
    There's only one way out of this, and that is to stop the
 deterioration of our job base, to have a growing, expanding
 job base, to give us the tax base--see, balancing the budget
 is not nearly as difficult as paying off the $4 trillion
 debt and leaving our children the American dream intact.
    We have spent their money. We've got to pay it back. This
 is going to take fair, shared sacrifice. My plan balances
 the budget within 6 years. We didn't do it faster than that
 because we didn't want to disrupt the economy. We gave it
 off to a slow start and a fast finish to give the economy
 time to recover. But we faced it and we did it, and we
 believe it's fair, shared sacrifice.
    The one thing I have done is lay it squarely on the table
 in front of the American people. You've had a number of
 occasions to see in detail what the plan is, and at least
 you'll understand it. I think that's fundamental in our
 country, that you know what you're getting into.
    LEHRER: Governor, the word "pain"--one of the other
 leadership things that's put on you is that you don't speak
 of pain, that you speak of all things--nobody's going to
 really have to suffer under your plan. You've heard what Mr.
 Perot has said. He's said it's got--to do the things that
 you want to do, you can't do it by just taking the money
 from the rich. That's what the president says as well.
    How do you respond to that? They said the numbers don't
 add up.
    GOVERNOR CLINTON: I disagree with both of them. For one
 thing, let me just follow up here. I disagree with Mr. Perot
 that the answer is to raise--put a 50-cent gas tax on the
 middle class and raise more taxes on the middle class and
 the working poor than on the wealthy.
    His own analysis says that unemployment will be slightly
 higher in 1995 under his plan than it is today.
    And as far as what Mr. Bush says, he is the person who
 raised taxes on the middle class after saying he wouldn't.
 And just this year, Mr. Bush vetoed a tax increase on the
 wealthy that gave middle class tax relief. He vetoed middle
 class tax relief this year.
    And furthermore, under this administration, spending has
 increased more than it has in the last 20 years and he asked
 Congress to spend more money than it actually spent. Now,
 it's hard to out-spend Congress but he tried to for the last
 3 years.
    So my view is the middle class is the--they've been
 suffering, Jim. Now, should people pay more for Medicare if
 they can? Yes. Should they pay more for Social Security if
 they get more out of it than they paid in, they're upper
 income people? Yes. But look what's happened to the middle
 class. Middle class Americans are working harder for less
 money than they were making ten years ago and they're paying
 higher taxes. The tax burden on them has not gone down. It
 has gone up. I don't think the answer is to slow the economy
 down more, drive unemployment up more and undermine the
 health of the private sector. The answer is to invest and
 grow this economy. That's what works in other countries and
 that's what'll work here.
    LEHRER: As a practical matter, Mr. President, do you
 agree with the governor when he says that the middle class,
 the taxes on the middle class--do your numbers agree that
 the taxes on the middle class have gone up during the last--
    PRESIDENT BUSH: I think everybody's paying too much
 taxes. He refers to one tax increase. Let me remind you it
 was a Democratic tax increase, and I didn't want to do it
 and I went along with it. And I said I make a mistake. If I
 make a mistake, I admit it. That's quite different than
 some. But I think that's the American way.
    I think everyone's paying too much, but I think this idea
 that you can go out and--then he hits me for vetoing a tax
 bill. Yes, I did. And the American taxpayer ought to be glad
 they have a president to stand up to a spending Congress. We
 remember what it was like when we had a spending president
 and a spending Congress, and interest rates--who remembers
 that? They were at 21.5 % under Jimmy Carter, and inflation
 was 15. We don't want to go back to that.
    And so yes, everybody's taxed too much and I want to get
 the taxes down, but not by signing a tax bill that's gonna
 raise taxes on people.
    LEHRER: Mr. President, when you said just then that you
 admit your mistakes and you looked at Governor Clinton and
 said--what mistake is it that you want him to admit to?
    PRESIDENT BUSH: Well, the record in Arkansas. I mean,
 look at it, and that's what we're asking America to have?
 Now look, he says Arkansas's a poor state. They are. But in
 almost every category they're lagging. I'll give you an
 example. He talks about all the jobs he's created in one or
 2 years. Over the last ten years since he's been governor,
 they're 30 % behind, 30 %--they're 30 % of the national
 average. On pay for teachers, on all these categories,
 Arkansas is right near the very bottom.
    You haven't heard me mention this before, but we're
 getting close now and I think it's about time I start
 putting things in perspective. And I'm going to do that.
 It's not dirty campaigning because he's been talking about
 my record for a half a year here, 11 months here. So we've
 got to do that. I gotta get it in perspective.
    What's his mistake? Admit it, that Arkansas is doing
 very, very badly against any standard--environment, support
 for police officers, whatever it is.
    LEHRER: Governor, is that true?
    GOVERNOR CLINTON: Mr. Bush's Bureau of Labor Statistics
 says that Arkansas ranks first in the country in the growth
 of new jobs this year, first.
    PRESIDENT BUSH: This year.
    GOVERNOR CLINTON: 4th in manufacturing jobs, 4th in the
 reduction of poverty, 4th in income increase. Over the last
 10 years we've created manufacturing jobs much more rapidly
 than the national average. Over the last 5 years our income
 has grown more rapidly than the national average. We are 2d
 in tax burden, the 2d lowest tax burden in the country.
    We have the lowest per capita state and local spending in
 the country. We're low spending, low tax burden. We
 dramatically increased investment and our jobs are growing.
 I wish America had that kind of record and I think most
 people looking at us tonight would like it if we had more
 jobs and a lower spending burden on the government.
    LEHRER: Mr. Perot, if you were sitting at home now and
 just heard this exchange about Arkansas, who would you
 believe?
    PEROT: I grew up 5 blocks from Arkansas. Let's put it in
 perspective. It's a beautiful state. It's a fairly rural
 state. It has a population less than Chicago or Los Angeles,
 about the size of Dallas and Forth Worth combined.
    So I think probably we're making a mistake night after
 night after night to cast the nation's future on a unit that
 small.
    LEHRER: Why is that a mistake?
    PEROT: It's irrelevant.
    (Laughter)
    LEHRER: What he did as governor of Arkansas is
 irrelevant?
    PEROT: No, no, no, but I could say, you know, that I ran
 a small grocery store on the corner, therefore I extrapolate
 that into the fact that I can run Wal-Mart. That's not true.
    (Laughter)
    I can't protect an Arkansas company, you notice there,
 Governor.
    LEHRER: Governor?
    GOVERNOR CLINTON: Mr. Perot, with all respect, I think it
 is highly relevant, and I think that a 4-billion budget of
 state and federal funds is not all that small, and I think
 the fact that I took a state that was one of the poorest
 states in the country and had been for 153 years and tried
 my best to modernize its economy and to make the kind of
 changes that have generated support from people like the
 presidents of Apple Computer and Hewlett-Packard and some of
 the biggest companies in this country, 24 retired generals
 and admirals and hundreds of business executives, are highly
 relevant. And, you know, I'm frankly amazed that since you
 grew up 5 blocks from there you would think that what goes
 on in that state is irrelevant. I think it's been pretty
 impressive.
    PEROT: It's not--
    GOVERNOR CLINTON: And the people who have jobs--
    (Applause)
    The people who have jobs and educations and opportunities
 that didn't have them 10 years ago don't think it's
 irrelevant at all; they think it's highly relevant and they
 wish the rest of the country had them.
    PRESIDENT BUSH: I don't have a dog in this fight, but I'd
 like to get in on this.
    GOVERNOR CLINTON: Well, you think it's relevant.
    (Laughter)
    PRESIDENT BUSH: Governor Clinton has to operate under a
 balanced budget amendment--he has to do it, that is the law.
 I'd like to see a balanced budget amendment for America, to
 protect the American taxpayers, and then that would
 discipline not only the executive branch but the spending
 Congress, the Congress that's been in control of one party,
 his party, for 38 years. And we almost had it done.
    And that institution, the House of Representatives--
  everyone is yelling "Clean House!" One of the reasons is we
 almost had it done, and the speaker--a very, able, decent
 fellow, I might add--but he twisted the arms of some of the
 sponsors of that legislation and had them change their vote.
 What's relevant here is that tool, that discipline, that he
 has to live by in Arkansas, and I'd like it for the American
 people. I want the line-item veto. I want a check-off, so if
 the Congress can't do it, let people check off their income
 tax, 10 % of it, to compel the government to cut spending.
 And if they can't do it, if the Congress can't do it, let
 them then have to do it across the board. That's what we
 call a sequester. That's the discipline we need, and I'm
 working for that--to protect the American taxpayer against
 the big spenders.
    LEHRER: Mr. President, let's move to some of the
 leadership concerns that have been voiced about you. And
 they relate to something you said in your closing statement
 in Richmond the other night about the president being the
 manager of crises. And that relates to an earlier criticism,
 that you began to focus on the economy, on health care, on
 racial divisions in this country, only after they became
 crises.
    Is that a fair criticism?
    PRESIDENT BUSH: Jim, I don't think that's a fair shot. I
 hear it--I hear it echoed by political opponents. But I
 don't think it's fair. I think we've been fighting from day
 one to do something about the inner cities. I'm for
 enterprise zones. I have had it in every single proposal
 I've sent to the Congress. And now we hear a lot of talk,
 oh, well, we all want enterprise zones, and yet the House
 and the Senate can't send it down without loading it up with
 a lot of, you know, these Christmas tree ornaments they put
 on the legislation.
    I don't think in racial harmony that I'm a laggard on
 that. I've been speaking out since day 1. We've gotten the
 Americans for Disabilities Act, which I think is one of the
 foremost pieces of civil rights legislation. And yes, it
 took me to veto 2 civil rights quota bills because I don't
 believe in quotas, and I don't think the American people
 believe in quotas. And I beat back the Congress on that, and
 then we passed a decent civil rights bill that offers
 guarantees against discrimination in employment.
    And that is good.
    I've spoken out over and over again against antisemitism
 and racism, and I think my record as a member of Congress
 speaks for itself on that.
    What was the other part of it?
    LEHRER: Well, it's just that--you've spoken to it. I
 mean, but the idea, not so much in specifics, but that it
 has to be a crisis before it gets your attention.
    PRESIDENT BUSH: I don't think that's true at all. I don't
 think that's true, but you know, let others fire away on it.
    LEHRER: Do you think that's true, Mr. Perot?
    PEROT: I'd like to just talk about issues, and so--
    LEHRER: You don't think this is an issue?
    PEROT: Well, no, but the point is that's a subjective
 thing. See, the subjective thing is when does President Bush
 react? And it would be very difficult for me to answer that
 in any short period of time.
    LEHRER: Well, then, let's phrase--I'll phrase it
 differently, then. He said the other night in his closing
 words in Richmond that one of the key things that he
 believes the American people should decide between--among
 the 3 of you is who they want in charge if this country gets
 to a crisis.
    Now, that's what he said, and the rap on the president is
 that it's only crisis time that he focuses on some of these
 things. So my question to you--we're going to talk about you
 in a minute--
    (Laughter)
    --my question to you--
    PEROT: I thought you'd forgotten I was here.
    LEHRER: No, no, no, no, no.
    (Laughter)
    But my question to you is, so--if you have nothing to say
 about it, fine, I'll go to Governor Clinton, but--
    PEROT: I will let the American people decide that. I
 would rather not critique the 2 candidates.
    LEHRER: All right. Governor, what do you think?
    GOVERNOR CLINTON: The only thing I would say about that
 is, I think that on the economy, Mr. Bush said for a long
 time there was no recession, and then said it would be
 better to do nothing than to have a compromise effort with
 the Congress.
    He really didn't have a new economic program until over
 1300 days into his presidency, and not all of his health
 care initiative has been presented to the Congress even now.
    I think it's important to elect a president who is
 committed to getting this economy going again, and who
 realizes we have to abandon trickle-down economics and put
 the American people first again, and who will send programs
 to the Congress in the first hundred days to deal with the
 critical issues that America is crying out for leadership
 on--jobs, incomes, the health care crisis, the need to
 control the economy. Those things deserve to be dealt with
 from day one. I will deal with them from day 1. They will be
 my first priority, not my election year concern.
    LEHRER: Mr. President?
    PRESIDENT BUSH: Well, I think you're overlooking that we
 have had major accomplishments in the first term. But if
 you're talking about protecting the taxpayer against his
 friends in the US Congress, go back to what it was like when
 you had a Democratic president and a Democratic Congress.
 You don't have to go back to Herbert Hoover. Go back to
 Jimmy Carter, and interest rates were 21 %, inflation was
 15 %. The misery index--unemployment and inflation added
 together--it was invented by the Democrats--went right
 through the roof. We've cut it in half.
    And all you hear about is how bad things are. You know,
 remember the question, are you better off? Well, is a
 homebuyer better off he can refinance the home, because
 interest rates are down? Is the senior citizen better off
 because inflation is not wiping out their family's savings?
 I think they are. Is the guy out of work better off? Of
 course he's not, but he's not gonna be better off if we grow
 the government, if we invest, as Governor Clinton says,
 invest in more government.
    You've got to free up the private sector. You've got to
 let small businesses have more incentives. For 3 months--
  quarters I've been fighting, 3 quarters been fighting to
 get the Congress to pass some incentives for small business.
 Capital gains, investment tax allowance, credit for first-
 time homebuyers. And it's blocked by the Congress. And then
 if a little of it comes my way, they load it up with
 Christmas trees and tax increases, and I have to stand up
 and favor the taxpayer.
    LEHRER: I have to--we have to talk about Ross Perot now
 or he'll get me, I'm sure. Mr. Perot, on this issue that I
 have raised at the very beginning and we've been talking
 about, which is leadership, as president of the US, it
 concerns--my reading of it, at least, my concerns about you,
 as expressed by folks in the polls and other places, it goes
 like this.
    You had a problem with General Motors. You took your
 $750 million and you left. You had a problem in the spring
 and
 summer about some personal hits that you took as a potential
 candidate for president of the US and you walked out.
    Does that say anything relevant to how you would function
 as president of the US?
    PEROT: I think the General Motors thing is very relevant.
 I did everything I could to get General Motors to face its
 problems in the mid-'80s while it was still financially
 strong. They just wouldn't do it, and everybody now knows
 the terrible price they're paying by waiting until it's
 obvious to the brain-dead that they have problems.
    Now, hundreds, thousands of good, decent people, whole
 cities up here in this state are adversely impacted because
 they would not move in a timely way. Our government is that
 point now. The thing that I am in this race for is to tap
 the American people on the shoulder and to say to every
 single one of you, fix it while we're still relatively
 strong. If you have a heart problem, you don't wait till a
 heart attack to address it.
    So the General Motors experience is relevant. At the
 point when I could not get them to address those problems, I
 had created so much stress in the board, who wanted to just
 keep the Lawrence Welk music going, that they asked to buy
 my remaining shares. I sold them my remaining shares. They
 went their way. I went my way because it was obvious we had
 a complete disagreement about what should be done with the
 company.
    But let's take my life in perspective. Again and again,
 on complex, difficult tasks, I have stayed the course. When
 I was asked by our government to do the POW project, within
 a year the Vietnamese had sent people into Canada to make
 arrangements to have me and my family killed. And I had 5
 small children, and my family and I decided we would stay
 the course, and we lived with that problem for 3 years.
    Then I got into the Texas War on Drugs program and the
 big-time drug dealers got all upset. Then when I had 2
 people imprisoned in Iran, I could have left them there. I
 could have rationalized it. We went over, we got them out,
 we brought them back home. And since then, for years, I have
 lived with the burden of the Middle East, where it's eye for
 an eye and tooth for a tooth country, in terms of their
 unhappiness with the fact that I was successful in that
 effort.
    Again and again and again, in the middle of the night, at
 2 or 3 o'clock in the morning, my government has called me
 to take extraordinary steps for Americans in distress, and
 again and again and again I have responded. And I didn't
 wilt and I didn't quit.
    Now, what happened in July we've covered again and again
 and again. But I think in terms of the American people's
 concern about my commitment, I'm here tonight, folks; I
 never quit supporting you as you put me on the ballot in the
 other 26 states; and when you asked me to come back in, I
 came back in. And talk about not quitting, I'm spending my
 money on this campaign; the 2 parties are spending your
 money, taxpayer money. I put my wallet on the table for you
 and your children. Over $60 million at least will go into
 this campaign to lead the American dream to you and your
 children, to get this country straightened out, because if
 anybody owes it to you, I do. I've lived the American dream;
 I'd like for your children to be able to live it, too.
    (Laughter)
    LEHRER: Governor, do you have a response to the staying-
 the-course question about Mr. Perot?
    GOVERNOR CLINTON: I don't have any criticism of Mr.
 Perot. I think what I'd like to talk about a minute, since
 you're asking the question, is the General Motors issue. I
 don't think there's any question that the automobile
 executives made some errors in the 1980s, but I also think
 we should look at how much productivity has increased
 lately, how much labor has done to increase productivity and
 how much management has done. And we're still losing a lot
 of auto jobs, in my judgment, because we don't have a
 national economic strategy that will build the industrial
 base of this country.
    Just today I met with the presidents and the vice
 presidents of the Willow Run union here, near here. They
 both said they were Vietnam veterans supporting me because I
 had an economic program to put them back to work. We need an
 investment incentive to modernize plant and equipment; we've
 got to control the health care costs for those people--
 otherwise we can't keep the manufacturing jobs here; and we
 need a tough trade policy that is fair, that insists on open
 markets and return for open markets. We ought to have a
 strategy that will build the economic and industrial base.
    So I think Mr. Perot was right in questioning the
 management practices. But they didn't have much of a partner
 in government here as compared with the policies the Germans
 and the Japanese followed, and I believe we can do better.
 That's one of the things I want to change. I know that we
 can grow manufacturing jobs. We did it in my state, and we
 can do it nationally.
    LEHRER: Mr. President, do you have a response?
    PRESIDENT BUSH: To this?
    LEHRER: Yes.
    PRESIDENT BUSH: Well, I wondered, when Governor Clinton
 was talking to the auto workers, whether he talked about his
 and Senator Gore's favoring CAFE standards, fuel efficiency
 standards, of 40 miles per gallon. That would break the auto
 industry and throw a lot of people out of work.
    As regarding Mr. Perot, I take back something I said
 about him. I once said, in a frivolous moment, when he got
 out of the race: If you can't stand the heat, buy an
 airconditioning company. And I take it back, because I
 think-- he said he made a mistake. And the thing I find is
 if I make a mistake, I admit it. I've never heard Governor
 Clinton make a mistake.
    But one mistake he's made is fuel efficiency standards at
 40 to 45 miles a gallon will throw many auto workers out of
 work, and you can't have it both ways. There's a pattern
 here of appealing to the auto workers and then trying to
 appeal to the spotted owl crowds or the extremes in the
 environmental movement. You can't do it as president: you
 can't have a pattern of one side of the issue one day and
 another the next.
    So my argument is not with Ross Perot; it is more with
 Governor Clinton.
    LEHRER: Governor, what about that charge? Do you want it
 both ways on this issue?
    GOVERNOR CLINTON: Let's just talk about the CAFE
 standards--that's the fuel efficiency standards. They are
 now 27.5 miles per gallon per automobile fleet. I never
 said--and I defy you to find where I said--I gave an
 extensive environmental speech in April, and I said that we
 ought to have a goal of raising the fuel efficiency
 standards to 40 miles a gallon. I think that should be a
 goal. I have never said we should write it into law if there
 is evidence that that goal cannot be achieved. The Natl
 Science Foundation did a study which said it would be
 difficult for us to reach fuel efficiency standards in
 excess of 37 miles per gallon by the year 2000.
    I think we should try to raise the fuel efficiency. And
 let me say this. I think we ought to have incentives to do
 it, I think we ought to push to do it. That doesn't mean we
 have to write it into the law.
    Look, I am a job creator, not a job destroyer. It is the
 Bush administration that has had no new jobs in the private
 sector in the last 4 years. In my state, we're leading the
 country in private sector job growth.
    But it is good for America to improve fuel efficiency. We
 also ought to convert more vehicles to compressed natural
 gas. That's another way to improve the environment.
    LEHRER: Mr. Perot, based on your experience at General
 Motors, where do you come down on this? This has been thrown
 about, back and forth, during this campaign from the very
 beginning about jobs and CAFE standards.
    PEROT: Well, everybody's nibbling around the edges. Let's
 go to the center of the bull's-eye, the core problem. And
 believe me, everybody on the factory floor all over this
 country knows it. You implement that NAFTA, the Mexican
 trade agreement, where they pay people a dollar an hour,
 have no health care, no retirement, no pollution controls,
 et cetera, et cetera, et cetera, and you're going to hear a
 giant sucking sound of jobs being pulled out of this country
 right at a time when we need the tax base to pay the debt
 and pay down the interest on the debt and get our house back
 in order.
    We've got to proceed very carefully on that. See, there's
 a lot I don't understand. I do understand business. I do
 understand creating jobs. I do understand how to make things
 work. And I got a long history of doing that.
    Now, if you want to go to the core problem that faces
 everybody in manufacturing in this country, it's that
 agreement that's about to be put into practice. It's very
 simple. Everybody says it'll create jobs. Yes, it'll create
 bubble jobs.
    Now, you know, watch this--listen very carefully to this.
 One-time surge while we build factories and ship machine
 tools and equipment down there. Then year after year for
 decades, they will have jobs. And I finally--I thought I
 didn't understand it--called all the experts, and they said,
 oh, it'll be disruptive for 12 to 15 years.
    We haven't got 12 days, folks. We cannot lose those jobs.
 They were eventually saying, Mexican jobs will eventually
 come to $7.50 an hour, ours will eventually go down to
 $7.50 an hour. Makes you feel real good to hear that, right?
    Let's think it through here. Let's be careful. I'm for
 free trade philosophically, but I have studied these trade
 agreements till the world has gone flat, and we don't have
 good trade agreements across the world.
    I hope we'll have a chance to get into that tonight,
 because I can get right to the center of the bull's-eye and
 tell you why we're losing whole industries in this country.
    LEHRER: Just for the record, though, Mr. Perot, I take
 it, then, from your answer, you do not have a position on
 whether or not enforcing the CAFE standards will cost jobs
 in the auto industry?
    PEROT: Oh, no, it will cost jobs, but that's not--let me
 say this. I'd rather, if you gave me 2 bad choices--
    LEHRER: Okay.
    PEROT: I'd rather have some jobs left here than just see
 everything head south, see?
    LEHRER: So that means--in other words, you agree with
 President Bush; is that right?
    PEROT: No, I'm saying our principal need now is to
 stabilize the tax base, which is the job base, and create a
 growing, dynamic base. Now please, folks, if you don't hear
 anything else I say, remember where the--millions of people
 at work are our tax base.
    One quick point. If you confiscate the Forbes 400 wealth,
 take it all, you cannot balance the budget this year. Kind
 of gets your head straight about where the taxes, year in
 and year out, have gotta come from. Millions and millions of
 people at work.
    LEHRER: Yes, sir.
    PRESIDENT BUSH: I'm caught in the middle on NAFTA. Ross
 says, with great conviction, he opposes the North American
 Free Trade Agreement. I am for the North American Free Trade
 Agreement. My problem with Governor Clinton, once again, is
 that one time he's gonna make up his mind, he sees some
 merit in it, but then he sees a lot of things wrong with it.
 Then the other day he says he's for it, however then we've
 got to pass other legislation.
    When you're president of the US, you cannot have this
 pattern of saying well, I'm for it but I'm on the other side
 of it. And it's true on this and it's true on CAFE.
    Look, if Ross were right when we get a free trade
 agreement with Mexico, why wouldn't they have gone down
 there now? You have a differential in wages right now. I
 just have an honest philosophical difference. I think free
 trade is going to expand our job opportunity. I think it is
 exports that have saved us when we're in a global slowdown,
 a connected global slowdown, a recession in some countries.
 And it's free trade, fair trade that needs to be our
 hallmark, and we need more free trade agreements, not fewer.
    LEHRER: Governor, quick answer on trade and I want to go
 on to something else.
    (Applause.)
    GOVERNOR CLINTON: I'd like to respond to that. You know,
 Mr. Bush was very grateful when I was among the Democrats
 who said he ought to have the authority to negotiate an
 agreement with Mexico. Neither I nor anybody else, as far a
 I know, agreed to give him our proxy to say that whatever he
 did was fine for the workers of this country and for the
 interests of this country.
    I am the one who's in the middle on this. Mr. Perot says
 it's a bad deal. Mr. Bush says it's a hunky-dory deal. I say
 on balance it does more good than harm if, if we can get
 some protection for the environment so that the Mexicans
 have to follow their own environmental standards, their own
 labor law standards, and if we have a genuine commitment to
 reeducate and retrain the American workers who lose their
 jobs and reinvest in this economy.
    I have a realistic approach to trade. I want more trade,
 and I know there are some good things in that agreement. But
 it can sure be made better.
    Let me just point out, just today in the Los Angeles
 Times Clyde Prestowitz, who was one of President Reagan's
 leading trade advisers and a life-long conservative
 Republican, endorsed my candidacy because he knows that I'll
 have a free and fair trade policy, a hard-headed, realistic
 policy, and not get caught up in rubber-stamping everything
 the Bush administration did. If I wanted to do that, why
 would I run for president, Jim? Anybody else can run the
 middle class down and run the economy in a ditch. I want to
 change it.
    (Applause.)
    LEHRER: We've got about 4--
    PRESIDENT BUSH: I think he made my case. On the one hand,
 it's a good deal but on the other hand I'd make it better.
 You can't do that as president. You can't do it on the war,
 where he says well, I was with the minority but I guess I
 would have voted with the majority.
    This is my point tonight. We're talking about 2 weeks
 from now you've gotta decide who's gonna be president. And
 there is this pattern that has plagued in him the primaries
 and now about trying to have it both ways on all these
 issues. You can't do that. And if you make a mistake, say
 you made a mistake and go on about your business, trying to
 serve the American people.
    Right now we heard it. Ross is against it. I am for it.
 He says on the one hand I am for it and on the other hand I
 may be against it.
    LEHRER: The governor--
    (Applause.)
    GOVERNOR CLINTON: That's what's wrong with Mr. Bush. His
 whole deal is you've gotta be for it or against it, you
 can't make it better. I believe we can be better. I think
 the American people are sick and tired of either/or
 solutions, people being pushed in the corner, polarized to
 extremes.
    GOVERNOR CLINTON (continuing): I want think they want
 somebody with common sense who can do what's best for the
 American people. And I'd be happy to discuss these other
 issues, but I can't believe he is accusing me of getting on
 both sides. He said trickle-down economics was voodoo
 economics; now he's it's biggest practitioner.
    (Laughter and applause)
    He promised--he--you know--let me just say--
    PRESIDENT BUSH: But I've always said trickle-down
 government is bad.
    GOVERNOR CLINTON: I could run this string out a long
 time, but remember this, Jim. Those 209 Americans last
 Thursday night in Richmond told us they wanted us to stop
 talking about each other and start talking about Americans
 and their problems and their promise, and I think we ought
 to get back to that.
    I'll be glad to answer any question you have, but this
 election ought to be about the American people.
    (Applause)
    LEHRER: Mr. Perot.
    PEROT: Is there an equal time rule tonight?
    PRESIDENT BUSH: Yes.
    PEROT: Or do you just keep lunging in at will? I thought
 we were going to have equal time, but maybe I just have to
 interrupt the other 2. Is that the way it works?
    LEHRER: No, it's--Mr. Perot, you're doing fine. Go ahead.
 Whatever you want to say, say it.
    PEROT: Now that we've talked all around the problem about
 free trade, let's go again to the center of the bull's- eye.
    LEHRER: Wait a minute. I was going to ask--I thought you
 wanted to respond to what we're talking about.
    PEROT: I do, I do.
    LEHRER: All right.
    PEROT: I just want to make--foreign lobbyists, this whole
 thing. Our country has sold out to foreign lobbyists. We
 don't have free trade. Both parties have foreign lobbyists
 on leaves in key roles in their campaigns. And if there's
 anything more unwise than that, I don't know what it is.
 Every debate I bring this up, and nobody ever addresses it.
    I would like for them to look you in the eye and tell you
 why they have people representing foreign countries working
 on their campaigns. And you know, you've seen the list, I've
 seen the list, we won't go into the names, but no wonder
 they-- if I had those people around me all day every day,
 telling me it was fair and free, I might believe it. But if
 I look at the facts as a businessman, it's so tilted, the
 first thing you ought to do is just say, guys, if you like
 these deals so well, we'll give you the deal you gave us.
    Now, Japanese couldn't unload the cars in this country if
 they had the same restrictions we had, and on and on and on
 and on and on. I suggest to you that the core problem--1
 country spent $400 million lobbying in 1988, our country.
 And it goes on and on. And you look at a who's who in these
 campaigns around the 2 candidates. They're foreign lobbyists
 taking leaves. What do you think they're going to do when
 the campaign's over? Go back to work at 30,000 bucks a month
 representing some other country. I don't believe that's in
 the American people's interest.
    I don't have a one of them, and I haven't taken a penny
 of foreign money, and I never will.
    (Applause)
    LEHRER: Mr. President, how do you respond to that? Mr.
 Perot's made that charge several times. The fact that you
 have people working in your campaign who are paid foreign
 lobbyists.
    PRESIDENT BUSH: Most people that are lobbying are
 lobbying the Congress. And I don't think there's anything
 wrong with an honest person who happens to represent an
 interest of another country for making his case. That's the
 American way. And what you're assuming is that that makes
 the recipient of the lobbying corrupt or the lobbyist
 himself corrupt. I don't agree with that.
    But if I found somebody that had a conflict of interest
 that would try to illegally do something as a foreign--
 registered lobby, the laws cover this. I don't know why--
 I've never understood quite why Mr. Perot was so upset it,
 because one of the guys he used to have working for him, I
 believe, had foreign accounts. Could be wrong, but I think
 so.
    PEROT: And as soon as I found it out, he went out the
 door.
    (Laughter)
    PRESIDENT BUSH: Well--
    (Applause)
    But I don't--I think you got to look at the integrity and
 the honor of the people that are being lobbied and those
 that are lobbyists. The laws protect the American taxpayer
 in this regard. If the laws are violated so much, but to
 suggest if somebody represents a foreign country on
 anything, that makes him corrupt or against the taxpayer, I
 don't agree with that.
    PEROT: One quick relevant specific. We're getting ready
 to dismantle the airlines industry in our country, and none
 of you know it. And I doubt in all candor if the president
 knows it. But this deal that we're doing with BAC and US Air
 and KLM and Northwest, guess who's on the president's
 campaign big time: a guy from Northwest. This deal is
 terribly destructive to the US airline industry. One of the
 largest industries in the world is the travel, tourist
 business. We won't be making airplanes in this country
 10 years from now if we let deals like this go through.
    If the president has any interest tonight, I'll detail it
 to you; I won't take 10 minutes tonight. All these things
 take a few minutes. But that's happening as we sit here
 today.
    We hammerlock the American companies--American Airlines,
 Delta--the last few great we have, because we're trying to
 do this deal with these 2 European companies. And never
 forget, they've got Airbus over there, and it's a
 government-owned, privately owned, consortium across Europe.
 They're dying to get the commercial airline business. Japan
 is trying to get the commercial airline business.
    I don't think there are any villains inside government on
 this issue, but there's sure a lot of people who don't
 understand business. And maybe you need somebody up there
 who understands when you're getting your pocket picked.
    (Applause)

    CLINTON: Jim.
    LEHRER: Governor, I'm sorry, but that concludes my time
 with--well, you...
    CLINTON: Why, I had a great response to that.
    LEHRER: All right, go ahead, quick, quickly.
    CLINTON: Just very briefly. I think Ross is right and
 that we do need some more restrictions on lobbyists. We
 ought to make them disclose the people they've given money
 to when they're testifying before congressional committees;
 we ought to close the lawyers' loopholes; they ought to have
 to disclose when they're really lobbying. And we ought to
 have to limit--we ought to have a much longer period of
 time, about 5 years, between the time when people can leave
 executive branch offices and then go out and start lobbying
 for foreign interests. I agree with that.
    We've wrecked the airline industry already because of all
 these leverage buyouts and all these terrible things that
 have happened to the airline industry. We're going to have a
 hard time rebuilding it.
    But the real thing we got to have is a competitive
 economic strategy. Look what's happening to McDonnell
 Douglas; even Boeing is losing market
 share--because we let the Europeans spend $25-$40 billion on
 Airbus without an appropriate competitive response.
    What I want America to do is to trade more but to compete
 and win by investing in competitive ways. And we're in real
 trouble on that.
    (Applause)
    LEHRER: I'm going to be in real trouble if I don't bring
 out--it's now time...
    BUSH: I promise it's less than 10 seconds.
    LEHRER: OK.
    BUSH: I heard Gov Clinton congratulate us on 1 thing--
 first time he said something pleasant about this
 administration. Productivity in this country is up, it is
 way up--productivity is up. And that's a good thing. There
 are many good ones, but I was glad he acknowledged that.
 Thank you.
    LEHRER: Now we're going to move to the 2d half...
    PEROT: Now give me 1 second...
    LEHRER:  We're going to move to the...
    PEROT:  I've volunteered. Now, look, I'm just kind of a,
 you know, cur dog here; I was put on the ballot by the
 people, not special interests. So I have to stand up for
 myself. Now, Jim, let me get it out. On the 2d debate, I
 offered, since both sides want the enterprise zones and we
 can't get together, I said I'll take a few days off and go
 to Washington and hold hands with you and we'll get it done.
 I'll take a few days off and hold hands with you and get
 this airlines thing straightened, because that's important
 to this country. That's kind of pathetic I have to do
 it--and nobody's called me yet to come up, I might mention.
    (Laughter)
    LEHRER:  All right, I want to bring in...
    PEROT:  But if they do--if they do, it's easy to fix. If
 you all want the enterprise zones, why don't we pass the
 dang thing and do it, right?
    LEHRER:  All right. Now we're going to bring in 3 other
 journalists to ask questions. They are Susan Rook of CNN,
 Gene Gibbons of Reuters and Helen Thomas of United Press
 Intl. You thought you'd never get in here, did you?
    BUSH:  Uh-uh. Uh-uh.
    (Applause.)
    LEHRER:  OK we're going to continue on the subject of
 leadership and the first question goes to Gov Clinton for a
 2-minute answer. It will be asked by Helen Thomas. Helen?
    HELEN THOMAS (upi): Governor Clinton, your credibility
 has come into question because of your different responses
 on the Vietnam draft. If you had it to do over again, would
 you put on the nation's uniform, and if elected, could you
 in good conscience send someone to war?
    GOVERNOR CLINTON: If I had it to do over again I might
 answer the questions a little better. You know, I'd been in
 public life a long time and no one had ever questioned my
 role and so I was asked a lot of questions about things that
 happened a long time ago and I don't think I answered them
 as well as I could have.
    Going back 23 years, I don't know, Helen. I was opposed
 to the war. I couldn't help that. I felt very strongly about
 it, and I didn't want to go at the time. It's easy to say in
 retrospect I would have done something differently.
    President Lincoln opposed the war and there were people
 who said maybe he shouldn't be president, but I think he
 made us a pretty good president in wartime. We've had a lot
 of other presidents who didn't wear their country's uniform
 who had to order our young soldiers into battle, including
 President Wilson and President Roosevelt.
    So the answer is I could do that. I wouldn't relish doing
 it but I wouldn't shrink from it. I think that the president
 has to be prepared to use the power of the nation when our
 vital interests are threatened, when our treaty commitments
 are at stake, when we know that something has to be done
 that is in the national interest, and that is a part of
 being president.
    Could I do it? Yes, I could.
    LEHRER: A reminder now. We're back on the St. Louis
 rules, which means that the governor had his answer and then
 each of you will have 1 minute to respond. Mr. President.
    PRESIDENT BUSH: Well, I've expressed my heartfelt
 difference with Governor Clinton on organizing
 demonstrations while in a foreign land against your country,
 when young ghetto kids have been drafted and are dying.
    My argument with him on--the question was about the
 draft--is that there's this same pattern. In New Hampshire
 Senator Kerrey said you ought to level, you ought to tell
 the truth about it. On April 17 he said he'd bring out all
 the records on the draft. They have not been forthcoming. He
 got a deferment or he didn't. He got a notice or he didn't.
 And I think it's this pattern that troubles me, more than
 the draft. A lot of decent, honorable people felt as he did
 on the draft. But it's this pattern.
    And again, you might be able to make amendments all the
 time, Governor, but you've got to, as president, you can't
 be on all these different sides, and you can't have this
 pattern of saying well, I did this or I didn't, then the
 facts come out and you change it.
    That's my big difference with him on the draft. It wasn't
 failing to serve.
    LEHRER: Your minute is up, sir.
    PRESIDENT BUSH: Yes, sir.
 Helen?
    HELEN THOMAS
    LEHRER: Mr. Perot, 1 minute.
    PEROT: I've spent my whole adult life very close to the
 military. I feel very strongly about the people who go into
 battle for our country. I appreciate their idealism, their
 sacrifices. Appreciate the sacrifices their families make.
 That's been displayed again and again in a very tangible
 way.
    I look on this as history. I don't look on it personally
 as relevant, and I consider it really a waste of time
 tonight, when you consider the issues that face our country
 right now.
    LEHRER: All right. The next question goes to President
 Bush and Gene Gibbons will ask it. Gene.
    (Applause.)
    GENE GIBBONS (Reuters): Mr. President, you keep saying
 that you made a mistake in agreeing to a tax increase to get
 the 1990 budget deal with Congress.  But if you hadn't
 gotten that deal, you would have either had to get repeal of
 the Gramm-Rudman Deficit Control Act or cut defense spending
 drastically at a time when the country was building up for
 the gulf war, and decimate domestic discretionary spending,
 including such things as air traffic control.
    If you had it to do all over again, sir, which of those
 alternatives would you choose?
    PRESIDENT BUSH: I wouldn't have taken any of the
 alternatives. I believe that--I believe I made a mistake. I
 did it for the very reasons you say. There was one good
 thing that came out of that budget agreement, and that is we
 put a cap on discretionary spending. One-third of the
 president's budget is at the president's discretion, or
 really the Congress, since they appropriate every time and
 tell a president how to spend every dime. We've put a cap on
 the growth of all that spending, and that's good and that's
 helped.
    But I was wrong because I thought the tax compromise,
 going along with 1 Democratic tax increase, would help the
 economy. I see no evidence that it has done it.
    So what would I have done? What should I have done? I
 should have held out for a better deal that would have
 protected the taxpayer and not ended up doing what we had to
 do, or what I thought at the time would help.
    So I made a mistake, and I--you know, the difference, I
 think, is that I knew at the time I was going to take a lot
 of political flak. I knew we'd have somebody out there
 yelling "read my lips", and I did it because I thought it
 was right. And I made a mistake. That's quite different than
 taking a position where you know it's best for you. That
 wasn't best for me and I knew it in the very beginning. I
 thought it would be better for the country than it was. So
 there we are.
    (Applause.)
    LEHRER: Mr. Perot, 1 minute.
    PEROT: 101 in leadership is be accountable for what you
 do. Let's go back to the tax and budget summit briefly.
 Nobody ever told the American people that we increased
 spending $1.83 for every dollar of taxes raised. That's
 absolutely unconscionable. Both parties carry a huge blame
 for that on their shoulders.
    This was not a way to pay down the deficit. This was a
 trick on the American people. That's not leadership.
    Let's go back in terms of accepting responsibility for
 your actions. If you create Saddam Hussein, over a 10-year
 period, using billions of dollars of US taxpayer money, step
 up to the plate and say it was a mistake. If you create
 Noriega, using taxpayer money, step up to the plate and say
 it was a mistake. If you can't get your act together to pick
 him up one day when a Panamanian major has kidnapped him and
 a special forces team is 400 yards away and it's a stroll
 across the park to get him, and if you can't get your act
 together, at least pick up the Panamanian major, who they
 then killed, step up to the plate and admit it was a
 mistake. That's leadership, folks.
    Now, leaders will always make mistakes. We've created,
 and I'm not aiming at any one person here, I'm aiming at our
 government--nobody takes responsibility for anything. We've
 gotta change that.
    LEHRER: I'm taking responsibility for saying your time's
 up.
    PEROT: I'm watching the lights.
    LEHRER: All right. Governor Clinton, 1 minute, sir.
    GOVERNOR CLINTON: The mistake that was made was making
 the "read my lips" promise in the first place just to get
 elected, knowing what the size of the deficit was.
    (Applause.)
    Knowing what the size of the deficit was, knowing there
 was no plan to control health care costs and knowing that we
 did not have a strategy to get real economic growth back
 into this economy. The choices were not good then. I think
 at the time, the mistake that was made was signing off on
 the deal late on Saturday night in the middle of the night.
 That's just what the president did when he vetoed the Family
 Leave Act.
    I think what he should have done is gone before the
 American people on the front end and said listen, I made a
 commitment and it was wrong. I made a mistake because I
 couldn't have foreseen these circumstances and this is the
 best deal we can work out at the time. He said it was in the
 public interest at the time and most everybody who was
 involved in it, I guess, thought it was. The real mistake
 was the "read my lips" promise in the first place. You just
 can't promise something like that just to get elected if you
 know there's a good chance that circumstances may overtake
 you.
    LEHRER: All right, Mr. Perot, the question is for you.
 You have a 2-minute answer, and it will be asked by Susan
 Rook.
    SUSAN ROOK (CNN): Mr. Perot, you've talked about going to
 Washington to do what the people who run this country want
 you to do. But it is the president's duty to lead, and often
 lead alone. How can you lead if you are forever seeking
 consensus before you act?
    PEROT: You're talking about 2 different subjects. In
 order to lead, you first have to use the White House as a
 bully pulpit and lead; then you have to develop consensus or
 you can't get anything done, and that's where we are now. We
 can't get anything done.
    How do you get anything done when you've got all of these
 political action committees, all of these thousands of
 registered lobbyists--40,000 registered lobbyists, 23,000
 special interest groups--and the list goes on and on and on.
 And the average citizen out here is just working hard every
 day. You've got to go to the people.
    I just love the fact that everybody, particularly in the
 media, goes bonkers over the town hall. I guess it's because
 you will lose your right to tell them what to think. The
 point is, they'll get to decide what to think.
    (Laughter and applause)
    I love the fact that people will listen to a guy with a
 bad accent and a poor presentation manner talking about flip
 charts for 30 minutes, because they want the details. See,
 all the folks up there at the top said the attention span of
 the American people is no more than 5 minutes, they won't
 watch it. They're thirsty for it.
    You want to have a new program in this country. If you
 get grassroots America excited about it, and if they tap
 Congress on the shoulder and say do it, Charlie, it'll
 happen. And that's a whole lot different from these fellows
 running up and down the halls whispering in their ears now
 and promising campaign funds for the next election if they
 do it.
    Now, I think that's going back to where we started.
 That's having a government from the people. I think that's
 the essence of leadership, rather than cutting deals in dark
 rooms in Washington.
    (Applause)
    LEHRER: Governor Clinton, 1 minute.
    GOVERNOR CLINTON: Well, I believe in the town hall
 meetings; they started with my campaign in New Hampshire.
 And I think Ross Perot has done a good job in having. And I,
 as you know, pushed for the debate to include the 209
 American citizens who were part of it in Richmond a few days
 ago. I've done a lot of them, and I'll continue to do them
 as president.
    But I'd also like to point out that I haven't been part
 of what we're criticizing in Washington tonight. Of the 3 of
 us, I have balanced a government budget 12 times, I have
 offered and passed campaign finance reform, offered, pushed
 for and passed in public referendum lobbyist restrictions,
 done the kinds of things you have to do to get legislators
 together not only to establish consensus but to challenge
 them to change.
    And in 12 years as governor I guess I've taken on every
 interest group there was in my state at one time or another
 to fight for change. It can be done. That's why I tried to
 be so specific in this campaign to have a mandate, if
 elected, so that Congress will know what the American people
 have voted for.
    (Applause)
    LEHRER: President Bush, 1 minute.
    PRESIDENT BUSH: I would like the record to show the
 panelists that Ross Perot took the first shot at the press.
 My favorite bumper sticker, though, is: Annoy the Media.
 Re-elect President Bush. And I just had to work that in.
 Sorry, Helen.
    (Laughter and applause)
    I'm going to pay for this later on. Look, you have to
 build a consensus, but in some things--Ross mentioned Saddam
 Hussein. Yes, we tried, and, yes, we failed to bring him
 into the family of nations; he had the 4th largest army. But
 then when he moved against Kuwait, I said this will not
 stand. And it's hard to build a consensus. We went to the
 UN, we made historic resolutions up there, the whole world
 was united, our Congress was dragging its feet. Governor
 Clinton said, well, I might have been with the minority, let
 sanctions work--but I guess I would have voted with the
 majority.
    A president can't do that. Sometimes he has to act. And
 in this case I'm glad we did, because if we had let
 sanctions work and tried to build a consensus on that,
 Saddam Hussein today would be in Saudi Arabia controlling
 the world's oil supply, and he would be there maybe with a
 nuclear weapon. We busted the 4th largest army, and we did
 it through leadership.
    LEHRER: All right, we're going to go on to another
 subject now, and the subject is priorities. The first
 question goes to you, President Bush, and Susan will ask it.
    ROOK: President Bush, gentlemen, I acknowledge that all
 of you have women and ethnic minorities working for you and
 working with you. But when we look at the circle of the key
 people closest to you, your inner circle of advisers, we see
 white men only. Why? And when will that change?
    PRESIDENT BUSH: You don't see Margaret Tutwiler sitting
 in there with me today.
    ROOK: The key people, President Bush.
    PRESIDENT BUSH: Huh?
    ROOK: The key people, the people beyond the glass
 ceiling.
    (Applause)
    PRESIDENT BUSH: I happen to think she's a key person. I
 think our Cabinet members are key people. I think the woman
 that works with me, Rose Zamaria, is about as tough as a
 boot out there and makes some discipline and protects the
 taxpayer.
    Look at our Cabinet. You talk about somebody strong. Look
 at Carla Hills. Look at Lynn Martin, who's fighting against
 this glass ceiling and doing a first-class job on it. Look
 at our surgeon general, Dr. Novello. You can look all around
 and you'll see first-class strong women.
    Jim Baker's a man. Yeah, I plead guilty to that.
    (Laughter)
    But look who's around with him there. I mean, this is a
 little defensive on your part, Susan, to be honest with you.
 We've got a very good record appointing women to high
 positions and positions of trust, and I'm not defensive at
 all about it. What we got to do is keep working, as the
 Labor Dept is doing a first-class job on, to break down
 discrimination, to break down the glass ceiling.
    And I am not apologetic at all about our record with
 women. We've got, I think--you know, you think about women
 in government, I think about women in business. Why not try
 to help them with my small business program to build some
 incentives into the system? I think we're making progress
 here.
    You got a lot of women running for office. As I said the
 other night, I hope a lot of them lose because they're
 liberal Democrats--
    (Laughter)
    --and we don't need more of them in the Senate or more of
 them in the House. But nevertheless, they're out there. And
 we got some very good Republican women running. So we're
 making dramatic progress.
    LEHRER: Mr. Perot, 1 minute.
    PEROT: Well, I come from the computer business, and
 everybody knows the women are more talented than the men. So
 we have a long history of having a lot of talented women.
 One of our first officers was a woman, the chief financial
 officer. She was a director. And it was so far back, it was
 considered so odd, and even though we were a tiny, little
 company at the time, it made all the national magazines.
    But in terms of being influenced by women and being a
 minority, there they are right out there, my wife and my 4
 beautiful daughters, and I just have 1 son, so he and I are
 surrounded by women, giving--telling us what to do all the
 time.
    (Laughter)
    And the rest of my minute, I want to make a very brief
 comment here in terms of Saddam Hussein. We told him that we
 wouldn't get involved with his border dispute, and we've
 never revealed those papers that were given to Ambassador
 Glaspie on July the 25th. I suggest, in the sense of taking
 responsibility for your actions, we lay those papers on the
 table. They're not the secrets to the nuclear bomb.
    Secondly, we got upset when he took the whole thing, but
 to the ordinary American out there who doesn't know where
 the oil fields are in Kuwait, they're near the border. We
 told him he could take the northern part of Kuwait, and when
 he took the whole thing, we went nuts. And if we didn't tell
 him that, why won't we even let the Senate Foreign Relations
 Committee and the Senate Intelligence Committee see the
 written instructions for Ambassador Glaspie?
    PRESIDENT BUSH: I've got reply on that. That gets to the
 national honor. We did not say to Saddam Hussein, Ross, you
 can take the northern part of Kuwait.
    PEROT: Well, where are the papers?
    PRESIDENT BUSH: That is absolutely absurd.
    PEROT: Where are the papers?
    PRESIDENT BUSH: Glaspie has testified--
    (Applause)
    --and Glaspie's papers have been presented to the US
 Senate. Please, let's be factual.
    PEROT: If you have time, go through Nexis and Lexis, pull
 all the old news articles, look at what Ambassador Glaspie
 said all through the fall and what-have-you, and then look
 at what she and Kelly and all the others in State said at
 the end when they were trying to clean it up. And talk to
 any head of any of those key committees in the Senate. They
 will not let them see the written instructions given to
 Ambassador Glaspie. And I suggest that in a free society
 owned by the people, the American people ought to know what
 we told Ambassador Glaspie to tell Saddam Hussein, because
 we spent a lot of money and risked lives and lost lives in
 that effort, and did not accomplish most of our objectives.
    We got Kuwait back to the emir but he's still not his
 nuclear, his chemical, his bacteriological and he's still
 over there, right? I'd like to see those written
 instructions.
    (Applause.)
    LEHRER: Mr. President, just to make sure that everybody
 knows what's going on here, when you responded directly to
 Mr. Perot, you violated the rule, your rules. Now--
    PRESIDENT BUSH: For which I apologize. When I make a
 mistake I say I'm sorry.
    (Laughter.)
    LEHRER: I just want to make sure everybody understands.
 If you all want to change the rules, we can do it.
    PRESIDENT BUSH: No, I don't. I apologize for it but that
 one got right to the national honor and I'm sorry. I just
 couldn't let it stand.
    LEHRER: Governor Clinton, you have a minute.
    GOVERNOR CLINTON: Susan, I don't agree that there are no
 women and minorities in important positions in my campaign.
 There are many. But I think even more relevant is my record
 at home. For most of my time as governor a woman was my
 chief of staff. An African American was my chief cabinet
 officer. An African American was my chief economic
 development officer.
    It was interesting today. There was a story today or
 yesterday in the Washington Post about my economic programs
 and my chief budget officer and my chief economic officer
 were both African Americans, even though the Post didn't
 mention that, which I think is a sign of progress.
    The Natl Women's Political Caucus gave me an award, one
 of their Good Guy Awards, for my involvement of women in
 high levels of government, and I've appointed more
 minorities to positions of high level in government than all
 the governors in the history of my state combined, before
 me.
    So that's what I'll do as president. I don't think we've
 got a person to waste and I think I owe the American people
 a White House staff, a Cabinet and appointments that look
 like America but that meet high standards of excellence, and
 that's what I'll do.
    (Applause.)
    LEHRER: All right. Next question goes to you, Mr. Perot.
 It's a 2-minute question and Helen will ask it. Helen?
    THOMAS: Mr. Perot, what proof do you have that Saddam
 Hussein was told that he could have the--do you have any
 actual proof or are you asking for the papers? And also, I
 really came in with another question. What is this penchant
 you have to investigate everyone? Are those accusations
 correct-- investigating your staff, investigating the
 leaders of the grassroots movement, investigating associates
 of your family?
    PEROT: No. They're not correct and if you look at my
 life, until I got involved in this effort, I was one person.
 And then after the Republican dirty tricks group got through
 with me I'm another person, which I consider an absolutely
 sick operation. And all of you in the press know exactly
 what I'm talking about.
    They investigated every single one of my children. They
 investigated my wife. They interviewed all of my children's
 friends from childhood on. They went to extraordinary sick
 lengths, and I just found it amusing that they would take 2
 or 3 cases where I was involved in lawsuits and would engage
 an investigator--the lawyers would engage an investigator,
 which is common. And the only difference between me and any
 other businessman that has the range of businesses that I
 have is I haven't had that many lawsuits.
    So that's just another one of those little fruit-loopy
 things they make up to try to, instead of facing issues, to
 try to redefine a person that's running against them. This
 goes on night and day. I will do everything I can, if I get
 up there, to make dirty tricks a thing of the past. One of
 the 2 groups has raised it to an art form. It's a sick art
 form.
    Now, let's go back to Saddam Hussein. We gave Ambassador
 Glaspie written instructions. That's a fact. We've never let
 the Congress and the Foreign Relations, Senate Intelligence
 Committees see them. That's a fact. Ambassador Glaspie did a
 lot of talking right after July 25 and that's a fact and
 it's in all the newspapers. And you pull all of it at once
 and read it and I did, and it's pretty clear what she and
 Kelly and the other key guys around that thing thought they
 were doing.
    Then at the end of the war, when they had to go testify
 about it, their stories are a total disconnect from what
 they said in August, September and October.
    So I say this is very simple. Saddam Hussein released a
 tape, as you know, claiming it was a transcript of their
 meeting, where she said we will not become involved in your
 border dispute and, in effect, you can take the northern
 part of the country. We later said no, that's not true. I
 said well, this is simple. What were her written
 instructions? We guard those like the secrets of the atomic
 bomb, literally.
    Now, I say whose country is this? This is ours. Who will
 get hurt if we lay those papers on the table? The worst
 thing is, again, it's a mistake. Nobody did any of this with
 evil intent. I just object to the fact that we cover up and
 hide things. Whether it's Iran-contra, Iraq-gate or you name
 it, it's a steady stream.
    LEHRER: Governor Clinton, you have 1 minute.
    GOVERNOR CLINTON: Let's take Mr. Bush for the moment at
 his word--he's right, we don't have any evidence at least
 that our government did tell Saddam Hussein he could have
 that part of Kuwait. And let's give him the credit he
 deserves for organizing Operation Desert Storm and Desert
 Shield. It was a remarkable event.
    But let's look at where I think the real mistake was
 made. In 1988 when the war between Iraq and Iran ended, we
 knew Saddam Hussein was a tyrant, we had dealt with him
 because he was against Iran--the enemy of my enemy maybe is
 my friend.
    All right, the war's over; we know he's dropping mustard
 gas on his own people, we know he's threatened to incinerate
 half of Israel. Several government departments-- several--
 had information that he was converting our aid to military
 purposes and trying to develop weapons of mass destruction.
 But in late '89 the president signed a secret policy saying
 we were going to continue to try to improve relations with
 him, and we sent him some sort of communication on the eve
 of his invasion of Kuwait that we still wanted better
 relations.
    So I think what was wrong--I give credit where credit is
 due--but the responsibility was in coddling Saddam Hussein
 when there was no reason to do it and when people at high
 levels in our government knew he was trying to do things
 that were outrageous.
    LEHRER: Mr. President, you have a moment--a minute, I'm
 sorry.
    PRESIDENT BUSH: Well, it's awful easy when you're dealing
 with 90-90 hindsight. We did try to bring Saddam Hussein
 into the family of nations; he did have the 4th largest
 army. All our Arab allies out there thought we ought to do
 just exactly that. And when he crossed the line, I stood up
 and looked into the camera and I said: This aggression will
 not stand. And we formed a historic coalition, and we
 brought him down, and we destroyed the 4th largest army. And
 the battlefield was searched, and there wasn't one single
 iota of evidence that any US weapons were on that
 battlefield. And the nuclear capability has been searched by
 the United Nations, and there hasn't been one single
 scintilla of evidence that there's any US technology
 involved in it.
    And what you're seeing on all this Iraqgate is a bunch of
 people who were wrong on the war trying to cover their necks
 and try to do a little revisionism. And I cannot let that
 stand, because it isn't true.
    Yes, we had grain credits for Iraq, and there isn't any
 evidence that those grain credits were diverted into
 weaponry--none, none whatsoever.
    (Applause)
    And so I just have to say, it's fine. You can't stand
 there, Governor Clinton, and say, well, I think I'd have
 been--I have supported the minority, let sanctions work or
 wish it would go away--but I would have voted with the
 majority. Come on, that's not leadership.
    LEHRER: All right, the next question goes to Governor
 Clinton, and Gene Gibbons will ask it. Gene?
    GIBBONS: Governor, an important aspect of leadership is,
 of course, anticipating problems. During the 1988 campaign
 there was little or not mention of the savings and loan
 crisis that has cost the American people billions and
 billions of dollars. Now there are rumblings that a
 commercial bank crisis is on the horizon.
    Is there such a problem, sir? If so, how bad is it and
 what will it cost to clean it up?
    GOVERNOR CLINTON: Gene, there is a problem in the sense
 that there are some problem banks, and on December 19th new
 regulations will go into effect which will in effect give
 the government the responsibility to close some banks that
 are not technically insolvent but that are plainly in
 trouble.
    On the other hand, I don't think that we have any reason
 to believe that the dimensions of this crisis are anywhere
 near as great as the savings and loan crisis. The mistake
 that both parties made in Washington with the S&L business
 was deregulating them without proper capital requirements,
 proper oversight and regulation, proper training of the
 executives. Many people predicted what happened, and it was
 a disaster.
    The banking system in this country is fundamentally sound
 with some weak banks. I think that our goal ought to be
 first of all not to politicize it, not to frighten people;
 secondly to say that we have to enforce the law in 2 ways.
    GOVERNOR CLINTON (continuing): We don't want to
 overreact, as the federal regulators have in my judgment, on
 good banks so that they've created credit crunches, that is,
 they have made our recession worse in the last couple of
 years--but we do want to act prudently with the banks that
 are in trouble.
    We also want to say that insofar as is humanly possible
 the banking industry itself should pay for the cost of any
 bank failures; the taxpayers should not. And that will be my
 policy.
    And I believe if we have a good balanced approach, we can
 get the good banks loaning money again, end the credit
 crunch, have proper regulation on the ones that are in
 trouble, and not overreact. It is a serious problem, but I
 don't see it as the kind of terrible, terrible problem that
 the S&L problem was.
    LEHRER: President Bush, one minute.
    PRESIDENT BUSH: Well, I don't believe it would be
 appropriate for a president to suggest that the banking
 system is not sound. It is sound. There are some problem
 banks out there. But what we need is financial reform; we
 need some real financial reform, banking reform,
 legislation. And I have proposed that. And when I am
 re-elected, I believe one of the first things ought to be to
 press a new Congress not beholden to the old ways to pass
 financial reform legislation that modernizes the banking
 system, doesn't put a lot of inhibitions on it, and protects
 the depositors through keeping the FDIC sound.
    But I think that--I just was watching some of the
 proceedings of the American Bankers Assn, and I think the
 general feeling is most of the banks are sound, certainly
 there's no comparison here between what happened to the S&Ls
 and where the banks stand right now, in my view.
    LEHRER: Mr. Perot, 1 minute.
    PEROT: Well, nobody's gotten into the real issue yet on
 the savings and loan again--nobody's got a business
 background, I guess. The whole problem came up in 1984. The
 president of the US was told officially it was a $20-billion
 problem. These crooks--now, Willie Sutton would have
 gone to own a savings and loan rather than rob banks,
 because he robbed banks because that's where the money is;
 owning a savings and loan is where the money was.
    Now, in 1984 they were told. I believe the vice president
 was in charge of deregulation. Nobody touched that tar baby
 till the day after election in 1988 because they were
 flooding both parties with crooked PAC money, and it was in
 many cases stolen PAC money. Now, you and I never got a ride
 on a lot of these yachts and fancy things it bought, but you
 and I are paying for it. And they buried it till right after
 the election.
    Now, if you believe The Washington Post and you believe
 this extensive study that's been done--and I'm reading it--
 right after election day this year they're going to hit us
 with a hundred banks, it will be a $100-billion problem.
 Now, if that's true, just tell me now. I'm grownup, I can
 deal with it, I'll pay my share. But just tell me now; don't
 bury until after the election twice. I say that to both
 political parties.
    The people deserve that since we have to pick up the tab;
 you got the PAC money, we'll pay the tab. Just tell us.
    LEHRER: All right, Mr. Perot, the next question-- we're
 going into a new round here on a category just called
 differences, and the question goes to you, Mr. Perot, and
 Gene will ask it. Gene?
    GIBBONS: Mr. Perot, aside from the deficit, what
 government policy or policies do you really want to do
 something about? What really sticks in your craw about
 conditions in this country--beside the deficit--that you
 would want to fix as president?
    PEROT: The debt and the deficit. Well, if you watched my
 television show the other night, you saw it. And if you
 watch it Thursday, Friday, Saturday this week, you'll get
 more. A shameless plug there, Mr. President.
    But in a nutshell we've got to reform our government or
 we won't get anything done. We have a government that
 doesn't work. All these specific examples I'm giving
 tonight-- if you had a business like that, they'd be leading
 you away and boarding up the doors. We have a government
 that doesn't work. It's supposed to come from the people, it
 comes at the people. The people need to take their
 government back. You've got to reform Congress, they've got
 to be servants of the people again; you've got to reform the
 White House. We've got to turn this thing around. And it's a
 long list of specific items.
    And I've covered it again and again in print and on
 television. But very specifically the key thing is to turn
 the government back to the people and take it away from the
 special interests and have people go to Washington to serve.
 Who can give themselves a 23 % pay raise anywhere in the
 world except Congress? Who would have 1200 airplanes worth
 2 billion a year just to fly around in? I don't have a free
 reserved parking place at Natl Airport, why should my
 servants? I don't have an indoor gymnasium and an indoor
 tennis and an indoor every other thing they can think of; I
 don't have a place where I can go make free TV to send to my
 constituents to try to brainwash them to elect me the next
 time.
    And I'm paying for all that for those guys. I'm going to
 be running an ad pretty soon that shows they promised us
 they were going to hold the line on spending at the tax and
 budget summit, and I'm going to show how much they've
 increased this little stuff they do for themselves. And it
 is silly putty, folks, and the American people have had
 enough of it.
    Step one, if I get up there, we're going to clean that
 up. You say, how can I get Congress to do that? I'll have
 millions of people at my shoulder, shoulder to shoulder with
 me, and we will see it done work speed--because it's wrong.
 We've turned the country upside down.
    (Applause)
    LEHRER: Governor Clinton, you have one minute. Governor?
    GOVERNOR CLINTON: I would just point out, on the point
 Mr. Perot made, I agree that we need to cut spending in
 Congress. I've called for a 25 % reduction in congressional
 staffs and expenditures. But the White House staff increased
 its expenditures by considerably more than Congress has in
 the last 4 years under the Bush administration, and Congress
 has actually spent a billion dollars less than President
 Bush asked them to spend. Now, when you out-spend Congress
 you're really swinging.
    That, however, is not my only passion. The real problem
 in this country is that most people are working hard and
 falling farther behind. My passion is to pass a jobs program
 and get incomes up with an investment incentive program to
 grow jobs in the private sector, to waste less public money
 and invest more, to control health care costs and provide
 for affordable health care for all Americans and to make
 sure we've got the best trained workforce in the world. That
 is my passion.
    We've gotta get this country growing again and this
 economy strong again or we can't bring down the deficit.
 Economic growth is the key to the future of this country.
    (Applause.)
    LEHRER: President Bush, one minute.
    PRESIDENT BUSH: On government reform?
    LEHRER: Sir?
    PRESIDENT BUSH: Government reform?
    LEHRER: Yes, exactly. Well, to respond to the subject
 that Mr. Perot mentioned.
    PRESIDENT BUSH: Well, how about this for a government
 reform policy? Reduce the White House staff by a 3d after or
 at the same time the Congress does the same thing for their
 staff. Term limits for members of the US Congress. Give the
 government back to the people. Let's do it that way. The
 president has term limits. Let's limit some of these guys
 sitting out there tonight.
    (Applause.)
    Term limits. And then how about a balanced budget
 amendment to the Constitution? Forty-3--more than that--
  states have it, I believe. Let's try that. And you want to
 do something about all this extra spending that concerns Mr.
 Perot and me? Okay. How about a line item veto? Forty-three
 governors have that. And give it to the president, and if
 the Congress isn't big enough to do it, let the president
 have a shot at this excess spending. A line item veto. That
 means you can take a line and cut out some of the pork out
 of a meaningful bill.
    Governor Clinton keeps hitting me on vetoing legislation.
 Well, that's the only protection the taxpayer has against
 some of these reckless pork programs up there, and I'd
 rather be able to just line it right out of there and get on
 about passing some good stuff but leave out the garbage.
 Line item veto--there's a good reform program for you.
    LEHRER: All right.
    (Applause.)
    Next question goes to Governor Clinton. You have
 2 minutes, Governor, and Susan will ask it.
    ROOK: Governor Clinton, you said that you will raise
 taxes on the rich, people with incomes of $200,000 a year or
 higher. A lot of people are saying that you will have to go
 lower than that, much lower. Will you make a pledge tonight
 below which, an income level that you will not go below? I'm
 looking for numbers, sir, not just a concept.
    GOVERNOR CLINTON: My plan--you can read my plan. My plan
 says that we want to raise marginal incomes on family
 incomes above $200,000 from 31 to 36 percent, that we want
 to ask foreign corporations simply to pay the same
 percentage of taxes on their income that American
 corporations play (sic) in America, that we want to use that
 money to provide over $100 billion in tax cuts for
 investment in new plant and equipment, for small business,
 for new technologies, and for middle class tax relief.
    Now, I'll tell ya this. I will not raise taxes on the
 middle class to pay for these programs. If the money does
 not come in there to pay for these programs, we will cut
 other government spending or we will slow down the phase-in
 of the programs. I am not gonna raise taxes on the middle
 class to pay for these programs.
    Now furthermore, I am not gonna tell you "read my lips"
 on anything because I cannot foresee what emergencies might
 develop in this country. And the president said never,
 never, never would he raise taxes in New Jersey, and within
 a day Marlin Fitzwater, his spokesman, said now, that's not
 a promise.
    So I think even he has learned that you can't say "read
 my lips" because you can't know what emergencies might come
 up. But I can tell you this. I'm not gonna raise taxes on
 middle class Americans to pay for the programs I've
 recommended. Read my plan.
    And you know how you can trust me about that? Because you
 know, in the first debate, Mr. Bush made some news. He'd
 just said Jim Baker was going to be secretary of state and
 in the first debate he said no, now he's gonna be
 responsible for domestic economic policy.
    Well, I'll tell ya. I'll make some news in the 3d debate.
 The person responsible for domestic economic policy in my
 administration will be Bill Clinton. I'm gonna make those
 decisions, and I won't raise taxes on the middle class to
 pay for my programs.
    (Applause.)
    LEHRER: President Bush, you have one minute.
    PRESIDENT BUSH: That's what worries me--
    (Laughter and applause)
    --that he's going to be responsible. He's going to do--
 and he would do for the US what he's done to Arkansas. He
 would do for the US what he's done to Arkansas. We do not
 want to be the lowest of the low. We are not a nation in
 decline.
    (Applause)
    We are a rising nation.
    Now, my problem is--I heard what he said. He said I want
 to take it from the rich, raise $150 billion from the rich.
 To get it, to get $150 billion in new taxes, you got to go
 down to the guy that's making $36,600. And if you want to
 pay for the rest of his plan, all the other spending
 programs, you're going to sock it to the working man.
    So when you hear "tax the rich," Mr. and Mrs. America,
 watch your wallet. Lock your wallet because he's coming
 right after you just like Jimmy Carter did and just like
 you're going to get--you're going to end up with interest
 rates at 21 %, and you're going to have inflation going
 through the roof.
    Yes, we're having tough times, but we do not need to go
 back to the failed policies of the past, when you had a
 Democratic president and a spendthrift Democratic Congress.
    (Applause)
    LEHRER: Mr. Perot.
    GOVERNOR CLINTON: Jim, you permitted Mr. Bush to break
 the rules, he said, to defend the honor of the country. What
 about the honor of my state? We rank first in the country in
 job growth, we got the lowest spending, state and local, in
 the country, and the 2d lowest tax burden. And the
 difference between Arkansas and the US is that we're going
 in the right direction and this country's going in the wrong
 direction. And I have to defend the honor of my state.
    (Applause)
    LEHRER: We've got a wash, according to my calculation. We
 have a wash. And we go to Mr. Perot for one minute. In other
 words, it's a violation of the rule, that's what I meant,
 Mr. Perot.
    PEROT: So I'm the only one that's untarnished at this
 point?
    LEHRER: That's right. You're clear.
    (Laughter and applause)
    PEROT: I'm sure I'll do it before it's over.
    (Laughter)
    Key thing here, see, we all come up with images. Images
 don't fix anything. I think--you know, I'm starting to
 understand it. You stay around this long enough, you think
 about--if you talk about it in Washington, you think you did
 it. If you've been on television about it, you think you did
 it.
    (Laughter)
    What we need is people to stop talking and start doing.
    Now, our real problem here is they both have plans that
 will not work. The Wall Street Journal said your numbers
 don't add up. And you can take it out on charts, you look at
 all the studies the different groups have done, you go out
 4, 5, 6 years, we're still drifting along with a huge
 deficit.
    So let's come back to harsh reality, and what I--you
 know, everybody says, gee, Perot, you're tough. I'm saying,
 well, this is not as tough as World War II and it's not as
 tough as the revolution. And it's fair, shared sacrifice to
 do the right thing for our country and for our children. And
 it will be fun if we all work together to do it.
    LEHRER: All right. This is the last question, and it goes
 to President Bush for a 2-minute answer. And it will be
 asked by Helen.
    THOMAS: Mr. President, why have you dropped so
 dramatically in the leadership polls, from the high 80s to
 the 40s? And you have said that you will do anything you
 have to do to get reelected. What can you do in 2 weeks to
 win reelection?
    PRESIDENT BUSH: Well, I think the answer to why the drop,
 I think, has been the economy in the doldrums. Why I'll win
 is I think I have the best plan of the 3 of us up here to do
 something about it. Mine does not grow the government, it
 does not invest, have government invest.
    It says we need to do better in terms of stimulating
 private business. We got a big philosophical difference here
 tonight between one who thinks the government can do all
 these things through tax and spend, and one who thinks it
 ought to go the other way.
    And so I believe the answer is, I'm going to win it
 because I'm getting into focus my agenda for America's
 renewal, and also I think that Governor Clinton's had pretty
 much of a free ride. On looking specifically at the Arkansas
 record--he keeps criticizing us, criticizing me, I'm the
 incumbent, fine. But he's an incumbent, and we've got to
 look at all the facts. They're almost at the bottom on every
 single category. We can't do that to the American people.
    And then, Helen, I really believe where people are going
 to ask this question about trust, because I do think there's
 a pattern by Governor Clinton of saying one thing to please
 one group, and then trying to please another group. And I
 think that pattern is a dangerous thing to suggest would
 work for the Oval Office. It doesn't work that way when
 you're president.
    Truman is right. The buck stops there. And you have to
 make decisions even when it's against your own interest. And
 I've done that. It's against my political interest to say go
 ahead and go along with the tax increase, but I did what I
 thought was right at the time. So I think people are going
 to be looking for trust and experience.
    And then, I mentioned it the other night, I think if
 there's a crisis, people are going to say, well, George Bush
 has taken us through some tough crises, and we trust him to
 do that.
    And so I'll make the appeal on a wide array of issues.
 Also I got a philosophical difference. I got to watch the
 clock here. I don't think we're a declining nation. The
 whole world has had economic problems. We're doing better
 than a lot of the countries in the world. And we're going to
 lead the way out of this economic recession across this
 world and economic slowdown here at home.
    LEHRER: Mr. Perot, you have--
    PRESIDENT BUSH: That's why I think I'll win.
    LEHRER: Mr. Perot--sorry, excuse me, sir. Mr. Perot, you
 have one minute.
    PEROT: I'm the last one, right?
    LEHRER: No, Governor Clinton has a minute after you. Then
 we have the closing statements.
    PEROT: One minute after you.
    LEHRER: Right.
    PEROT: I'm totally focussed on the fact that we may have
 bank failures and nobody answered it. I'm totally focussed
 on the fact that we are still evading the issue of the
 Glaspie papers. I'm totally focussed on the fact that we
 still could have enterprise zones, according to both
 parties, but we don't. So I am still focussed on gridlock, I
 guess.
    And I am also focussed on the fact that isn't it a
 paradox that we have the highest productivity in our
 workforce in the industrialized world and at the same time
 have the largest trade deficit, and at the same time rank
 behind 9 other nations in what we pay our most productive
 people in the world, and we're losing whole industries
 overseas.
    Now, can't somebody agree with me that the government is
 breaking business's legs with these trade agreements?
 They're breaking business's legs in a number of different
 ways. We have an adversarial relationship that's destroying
 jobs and sending them overseas while we have the finest
 workers in the world.
    Keep in mind a factory worker has nothing to do with
 anything except putting it together on the factory floor.
 It's our obligation to make sure that we give him the finest
 products in the world to put together and we don't break his
 legs in the process.
    LEHRER: Governor Clinton, one minute.
    GOVERNOR CLINTON: I really can't believe Mr. Bush is
 still trying to make trust an issue after "read my lips" and
 15 million new jobs and embracing what he called voodoo
 economics and embracing an export enhancement program for
 farmers he threatened to veto and going all around the
 country giving out money in programs that he once opposed.
    But the main thing is he still didn't get it, from what
 he said the other night to that fine woman on our program,
 the 209 people in Richmond. They don't want us talking about
 each other. They want us to talk about the problems of this
 country.
    I don't think he'll be reelected because trickle down
 economics is a failure and he's offering more of it, and
 what he's saying about my program is just not true. Look at
 the Republicans that have endorsed me. High tech executives
 in Northern California. Look at the 24 generals and
 admirals, retired, that have endorsed me, including the
 deputy commander of Desert Storm. Look at Sarah Brady, Jim
 Brady's wife, President Reagan's press secretary, who
 endorsed me because he knuckled under to the NRA and
 wouldn't fight for the Brady Bill.
    We've got a broad-based coalition that goes beyond party
 because I am going to change this country and make it
 better, with the help of the American people.
    (Applause.)
    LEHRER: All right. Now, that was the final question and
 answer and we now go to the closing statements. Each
 candidate will have up to 2 minutes. The order was
 determined by a drawing. Governor Clinton, you're first.
 Governor.
    GOVERNOR CLINTON: First, I'd like to thank the commission
 and my opponents for participating in these debates and
 making them possible. I think the real winners of the
 debates were the American people.
    I was especially moved in Richmond a few days ago when
 209 of our fellow citizens got to ask us questions. They
 went a long way toward reclaiming this election for the
 American people and taking their country back.
    I want to say, since this is the last time I'll be on a
 platform with my opponents, that even though I disagree with
 Mr. Perot on how fast we can reduce the deficit and how much
 we can increase taxes on the middle class, I really respect
 what he's done in this campaign to bring the issue of
 deficit reduction to our attention.
    I'd like to say to Mr. Bush, even though I've got
 profound differences with him, I do honor his service to our
 country. I appreciate his efforts and I wish him well. I
 just believe it's time to change.
    I offer a new approach. It's not trickle down economics.
 It's been tried for 12 years and it's failed. More people
 are working harder for less, 100,000 people a month losing
 their health insurance, unemployment going up, our economy
 slowing down. We can do better.
    And it's not tax and spend economics. It's invest and
 grow, put our people first, control health care costs and
 provide basic health care to all Americans, have an
 education system 2d to none and revitalize the private
 economy.
    That is my commitment to you. It is the kind of change
 that can open up a whole new world of opportunities to
 America as we enter the last decade of this century and move
 towards the 21st century. I want a country where people who
 work hard and play by the rules are rewarded, not punished.
 I want a country where people are coming together across the
 lines of race and region and income. I know we can do
 better.
    It won't take miracles and it won't happen overnight, but
 we can do much, much better if we have the courage to
 change. Thank you very much.
    (Applause.)
    LEHRER: President Bush, your closing statement, sir.
    PRESIDENT BUSH: Three weeks from now--2 weeks from
 tomorrow, America goes to the polls and you're going to have
 to decide who you want to lead this country to economic
 recovery. On jobs--that's the number one priority, and I
 believe my program for stimulating investment, encouraging
 small business, brand-new approach to education,
 strengthening the American family, and, yes, creating more
 exports is the way to go. I don't believe in trickle-down
 government, I don't believe in larger taxes and larger
 government spending.
    On foreign affairs, some think it's irrelevant. I believe
 it's not. We're living in an interconnected world. The whole
 world is having economic difficulties. The US is doing
 better than a lot. But we've got to do even better. And if a
 crisis comes up, I ask who has the judgment and the
 experience and, yes, the character to make the right
 decision?
    And, lastly, the other night on character Governor
 Clinton said it's not the character of the president but the
 character of the presidency. I couldn't disagree more.
 Horace Greeley said the only thing that endures is
 character. And I think it was Justice Black who talked about
 great nations, like great men, must keep their word.
    And so the question is, who will safeguard this nation,
 who will safeguard our people and our children? I need your
 support, I ask for your support. And may God bless the US of
 America.
    (Applause)
    LEHRER: Mr. Perot, your closing statement, sir.
    PEROT: To the millions of fine decent people who did the
 unthinkable and took their country back in their own hands
 and put me on the ballot, let me pledge to you that tonight
 is just the beginning. These next 2 weeks we will be going
 full steam ahead to make sure that you get a voice and that
 you get your country back.
    This Thursday night on ABC from 8:30 to 9, Friday night
 on NBC from 8 to 8:30, and Saturday night on CBS from 8 to
 8:30, we'll be down in the trenches under the hood working
 on fixin' the old car to get it back on the road.
    Now, the question is, can we win? Absolutely we can win,
 because it's your country. Question really is who do you
 want in the White House. It's that simple.
    Now, you got to stop letting these people tell you who to
 vote for, you got to stop letting these folks in the press
 tell you you're throwing your vote away--you got to start
 using your own head.
    (Applause)
    Then the question is, can we govern? I love that one. The
 "we" is you and me. You bet your hat we can govern because
 we will be in there together and we will figure out what to
 do, and you won't tolerate gridlock, you won't tolerate
 endless meandering and wandering around, and you won't
 tolerate non-performance. And, believe me, anybody that
 knows me understands I have a very low tolerance for
 non-performance also. Together we can get anything done.
    The president mentioned that you need the right person
 in a crisis. Well, folks, we got one, and that one is a
 financial crisis. Pretty simply, who's the best-qualified
 person up here on the stage to create jobs? Make your
 decision and vote on November the 3d. I suggest you might
 consider somebody who's created jobs. Who's the best person
 to manage money? I suggest you pick a person who's
 successfully managed money. Who's the best person to get
 results and not talk? Look at the record and make your
 decision.
    And, finally, who would you give your pension fund and
 your savings account to manage? And, last one, who would you
 ask to be the trustee of your estate and take care of your
 children if something happened to you?
    Finally, to you students up there--God bless you, I'm
 doing this for you: I want you to have the American dream.
    (Applause)
    To the American people, I'm doing this because I love
 you. That's it. Thank you very much.
    (Applause)
    LEHRER: All right, thank you, Mr. Perot; thank you, Mr.
 President; thank you, Governor Clinton--for being with us
 tonight and in the previous debates. Thank you to the panel.
 The only thing that is left to be said is, from Michigan
 State University in East Lansing, I'm Jim Lehrer,
 thank you and good night.
    (Applause)

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