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Press Briefing by Telephone with Gene Sperling and Bruce Reed to Preview The President's Speech in Dover, New Hampshire (1/10/01)

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                              THE WHITE HOUSE

                       Office of the Press Secretary
For Immediate Release                        January 10, 2001

                        PRESS BRIEFING BY TELEPHONE
                          IN DOVER, NEW HAMPSHIRE

10:37 A.M. EST

          Q    Basically, what is the President going to be talking about
in Dover?

          MR. REED:  He is going to Dover to give the third in a series of
speeches that he has been giving over the past month to sum up what he's
done and what challenges are left to do.  The reason he's going to Dover is
that it's where he gave his famous speech nine years ago saying that, I'll
be there for you until the last dog dies.

          And the speech is going to be on social progress, and Gene and I
will go through some of that for you.  It's worth taking a look at that
speech, if you haven't looked at it lately.  That is the --

          Q    Is it on the website, the Archives?

          MR. REED:  I don't think so.  I think you can --

          Q    Do you know the date of it?

          MR. REED:  It was February of '92, at the Dover Elks Club.  And
if you can't find a transcript, then we can help you track one down.  And I
can read you a couple parts of it just for fun.

          Q    What is that "last dog" doing now, Bruce?  (Laughter.)

          MR. REED:  Well, he has a new dog --

          Q    Oh, that's right, he's giving away Socks.  (Laughter.)

          MR. SPERLING:  And also, on tax issues, as we've heard, that dog
doesn't hunt.  (Laughter.)

          MR. REED:  But basically, what he talked about in that speech is
that the real character issue is who cares about you, who is really trying
to say what he would do specifically if he were elected President, who is
determined to change your life rather than to just get or keep power.  And
it was a defiant speech about what really mattered was rolling up our
sleeves and getting to work for the people of New Hampshire and the rest of
the country.

          The major points the President is going to make tomorrow are,
first, that the people were right and the pundits were wrong, that what
matters isn't who is up or down in Washington, it's who is up or down in
Dover and places like it.  And second, that the reason that we have made
such progress over the last eight years is that we put in place a new
approach to social problems that rejected the old labels and false choices
of what he called in that speech, the brain-dead politics of both parties,
and that we have sought at every turn to expand opportunity and demand
responsibility in return, and that we did this -- that this Third Way, as
he's called it, has been even more effective as a governing philosophy than
as a political one, that the only way -- it was the only way we could solve
the problems that we inherited.  The only way to turn around the welfare
system was to reward and demand work at the same time.  The only way to
make crime go down was to put more police on the street and do more
prevention.  The only way to build the new economy was to balance the
budget and increase investment at the same time, and so on.

          And he believes that this approach to social policy will endure;
that the new synthesis of helping those who are willing to help themselves
forms a lasting basis for activist government that wasn't there before;
that in the wake of the -- solutions of the '60s and the failed attempts of
the '70s and '80s had dramatically undermined confidence in government's
ability to solve problems, and that confidence has now been restored.

          And I think he will talk tomorrow, the major point he'll make is
that the strategy worked -- that crime is down to a 25-year low, that
welfare rolls are the lowest in 30 years, and just as important, people on
welfare are five times more likely to be working then they were when he
took office -- that we've lifted 7 million Americans out of poverty; that
we've doubled spending on education and put standards in place in every
state at the same time; and that because of that, that America has a whole
new confidence in its ability to solve social problems.

          The very notion of social progress was in some ways unthinkable
eight years ago.  The problems that we inherited of rising deficits, rising
rates of crime, welfare, illegitimacy, the decay of the inner city were
widely regarded as intractable problems that nobody could do anything
about.  And now, happily, that has changed, not just because of what we've
done, but because of what many have done around the country.  And we've
restored the faith that policy matters, that the approach government takes
matters, and as the President said in his first Inaugural, everything wrong
with America can be fixed with what's right with America.

          Gene, do you want to say anything more?

          MR. SPERLING: I guess that I'd just add is that we have seen,
over the eight years, as he promised during the campaign, a focus on the
economy, like a laser beam in the cause of empowering families.  And I
think what you've seen over this time period is an extremely -- as he
promised, an extremely focused eight-year commitment to turning our fiscal
situation around and, as Bruce said, investing in people at the same time.

          And I think what was very distinctive about this period was that
in the campaign in '92, the President -- then Governor Clinton -- promised
to do deficit reduction in a progressive way, in a way that still invests
in people and protected the poor.  I think there was great skepticism at
that time that that was possible and that was just a -- to promise both
deficit reduction and progressive investments was a political statement,
that you couldn't do both at the same time.

          Yet, when you look at how the Deficit Reduction Act of '93 was
put together -- with spending cuts, but also tax increases on the top 1.5
percent, with tax cuts during the earned income tax credit on the bottom 25
percent, and major increase in Head Start and WIC, you could see right from
the start that he kept to that commitment.  He kept to that commitment in
fighting the Contract With America in '95; he kept that commitment in
signing the  progressive Balanced Budget Agreement in '97; and he kept to
that commitment in saving the surplus for future generations, as opposed to
letting it go to regressive tax cut over the last few years.

          You also saw that this kind of sustained recovery, together with
a focus on more investments in education and training, higher earned income
tax credit, taking away the shields to barriers going to work      has
helped ensure that this recovery has benefitted all people.

          And there's a very consistent thread running through this.  When
you look at the minimum wage, when you look at the Earned Income Tax
Credit, when you look at the focus on child care, on not having people lose
their Medicaid when they go to work on the welfare reform, all of it is a
consistent pattern on addressing problems of the poor through taking away
barriers to work, and rewarding work.  And as a result -- and this is
really quite worth focusing on -- in the 12 years before we came into
office, the top 20 percent had seen their incomes go up 26.4 percent, but
you had no income growth for the bottom 60 percent during that 12-year

          Q    Could you repeat that again -- I'm sorry.

          MR. SPERLING:  During the 1981-to-1983 period, that 12-year
period, the highest quintile, the top 20 percent, saw their income grow
26.4 percent.  But the bottom 20 percent actually saw their income fall.
During a 12-year period their incomes actually fell by 4.4 percent.  And
then in the second and third quintiles, you had virtually flat -- virtually
zero growth.  So for the bottom 60 percent of American income workers in
the 12 preceding years, they had zero income growth, though the top 20
percent had 26.4 percent.

          Since 1993, all five quintiles have seen significant income
growth, even in a shorter time period.  The highest income growth has been,
we're proud to say, in the bottom 20 percent.  Their income is up 16.3
percent.  This is the Census numbers, the annual Census poverty numbers.

          Q    I'm sorry, that is bottom 20 percent?

          MR. SPERLING:  The bottom 20 percent have seen their income go up
16.3 percent.  The highest quintile is up 16 percent.  And then the second
quintile is up 13.6 percent; the middle quintile is up 13.4 percent; and
the fourth quintile is up 13.4 percent.

          So when you talk about that there was a commitment to make sure
not just that we had growth, but that we grew together, that all votes were
brought up together, that commitment is manifested in the numbers.  And I
do think there's no question that it was affected by the policies and the
values in which deficit reduction was conducted.
          Unlike the '80s, where many people were driven -- fell through
the cracks -- lost housing, lost some of their social safety nets -- this
was a period where the fiscal situation was turned around while actually
taking significant steps to empower people with the Earned Income Tax
Credit, with the education and training.  And so you've seen that all five
quintiles -- and those are -- that's inflation adjusted growth, have seen
more than double digit income growth in that time period, with the greatest
income growth being at the bottom 20 percent.

          Q    Gene, is the increase in the bottom 20 attributable largely
to the Earned Income Tax Credit?

          MR. SPERLING:  I think it's to a couple of things.  One is that
-- it's interesting.  The Census, the poverty numbers do things where they
include the Earned Income Tax Credit and then they show measures when they
don't.  Overall, there are 7 million less people in poverty today then when
the President took office.  That is a fall from -- where is it -- the
Earned Income Tax Credit pulls out generally about 4 million people out of
poverty, about 2 million more than when we took office.

          But in terms of what is credited with that, I would say two
things.  I wouldn't credit just one specific thing.  I would say that there
was a very conscious effort for eight years to not let the burden of
turning our fiscal situation around fall on the poor.  And I think you saw
in 1995, when deficit reduction was going to be done by undermining the
safety net, the President was willing to face even a government shut-down
to prevent that.  He was willing to take the significant political hit of
raising taxes on the most well off in '93 to prevent that.

          And he was, at this time, very much increasing funding.  Head
Start funding more than doubled during this period, more than doubled.
Dislocated worker training more than tripled.  As Bruce said, when you take
all of the key education -- I mean, education as a whole more than doubled
during this period, with significant amount going to low income.

          The other thing, though, which I think goes to the general
economic view, is that strong fiscal policy certainly gave the Federal
Reserve more flexibility.  It helped the management of a very long
expansion.  And as that expansion got longer and longer, the private sector
had to reach out more and more to people who had been on the fringes of the
work force.  And so you saw a very nice coming together of a long
expansion, a smart welfare reform plan, and pro-work programs like the
Earned Income Tax Credit.

          And, together, you had both economic -- a long expansion, and
economic and social policy all helping encourage more people who had been
on the fringes of the labor force moving into the work force.  That's just
a dramatic improvement.  It's stunning to see the unemployment rate fall
during the last -- during this period among where Hispanic unemployment has
gone from over 11 percent to 5.5 percent.

          Consider that when we came into office, unemployment was 7.4
percent for the country as a whole.  And -- I'm sorry, Hispanic
unemployment went from 11.3 percent to 5.7 percent.  African American
employment went from 14.1 percent to 7.6 percent.  So imagine that we came
into office, the general unemployment rate for the economy was 7.3 percent.
Consider that Hispanic employment now is lower than it was for the general
unemployment picture as a whole.  And remember also in December of that
year, people forget unemployment in California in '92 was 9.7 percent.  It
was nearly 10 percent in our largest state in --

          Q    I'm sorry, what was that average again for all Americans at
that time?

          MR. SPERLING:  It was 7.3 percent in January of '93 when we came
into office.

          Q    Okay.  And then, is the President going to address the fact
that obviously there's going to be sort of a change of mentality and
viewpoint in Washington with the Bush administration?  Is he going to
address that at all?

          MR. SPERLING:  Well, I think that he will talk about some of the
work that lies ahead on education, on health care, on maintaining the
prosperity.  I think that as he said yesterday in Chicago, we hope that on
some of these issues, the country can continue to make bipartisan progress.
We think it would be good for the country if education reform becomes a
bipartisan issue.

          Q    True, but getting away sort of from the specific issues and
getting more into the mentality that's going to be driving those changes
like you were discussing earlier between -- the mentality that President
Clinton brought that was successful in bringing about certain changes,
there's obviously going to be a change in that driving mentality.  Is he
going to address that at all?

          MR. REED:  I don't think he'll get a critique of the Bush agenda.
I think that there are some important issues he'll talk about that he hopes
will remain at the center of the national debate, like education, health
care, the economy.  And I think it's too early to tell whether the new
administration will govern from the center, in a practical way, as he has,
or make false choices and wrong choices as he tried not to do.

          Q    Can you guys talk at all about any sense within the White
House about him going back there?  I mean, this was a state that was almost
the end of the political road for him, and now he's going back there 10
days before he leaves his second term.  Is there any sort of sense of
nostalgia, or is there a specialness to going back to New Hampshire at all?

          MR. REED:  Oh, absolutely.  He has always felt a special bond
with the people of New Hampshire.  And he went back there early -- I guess
about two years ago, at this time, to say thank you.  But he wanted to go
back one more time and talk about what it all has meant.  And New Hampshire
certainly has gone through a stunning transformation over the last eight
years.  The recession in the early '90s hit there harder than almost
anywhere else.

          Gene, do you know off the top of your head what the unemployment
rate is down to now in New Hampshire?

          MR. SPERLING:  The unemployment rate -- I need to find out what
it was in '92.  By '93, January '93, it had gone down to 7.6.  It was still
above the national average.  It's a remarkably low 1.8 percent now, if you
can believe that.

          So, Bruce, we ought to think about that.  (Laughter.)  Bruce, we
ought to think about that.  They're looking for people there.  (Laughter.)

          MR. REED:  Find ourselves a Dunkin' Doughnut.  (Laughter.)

          Q    Manchester Holiday Inn.

          Q    Donuts and domestic policy.  (Laughter.)

          Q    Would you guys know off the top of your head, too, about
this stop in Manchester, what's going on there?  I guess it's a closed
event, but do you know what it is?

          MR. REED:  Oh, is there a closed event?

          MS. GEGENHEIMER:  I can chime in.  The President is just going to
go to a private reception.  If you have more questions, just contact the
press office.

          Q    Is that going to be a private reception with the Governor or
other --

          MS. GEGENHEIMER:  We can check on that.  If you want to check in
with the press office, we can get you some more details.

          Q    And are there future subjects coming up in any of the other
stops he's going to make, as he closes out his tenure here?  He's got a
trip to Arkansas, but you said that he'd talk about a couple different
subjects over the last week or so.  This one is going to be social
progress; are there other subjects to come?

          MR. REED:  I hesitate to say that this is the last.  But I don't
think there are any other policy speeches scheduled in the same way.  He's
done one on foreign policy, one on economic, and this one's on domestic.

          Q    Bruce, what's been decided about a possible state of the
union?  Is one going to be given?  Is there going to be a written state of
the union, or do you know if any decision's been made on that?

          MR. REED:  I don't know, Mark.

          Q    Have you guys decided what he's going to do on the 20th, in
terms of, is he going to go up to Chappaqua once he's done, or what's going
to happen that day?  Do you know yet?

          MR. REED:  I've heard that he's leaving for New York, but I don't
know the schedule for exactly what he's doing or -- I assume he's spending
the night in Chappaqua, but I don't know for a fact.

          Q    Is the speech in Boston going to mirror the one in Dover?

          MR. REED:  Yes, although I think that's more -- that is a big
crowd event, as I understand it.  So more of a rally then a policy speech.

          Thanks a lot.

                              END        11:05 A.M. EST

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