President Clinton: “It’s unrealistic that we can basically solve this whole thing (deficit) from cutting spending and just raising upper income taxes. We’re gonna have to have more growth. I think we’re gonna have to have more taxpayers, which is why I favor, in a disciplined way, immigration reform and letting more immigrants come to this country. I think it would make more jobs for people who are unemployed, not fewer.
We’re going to have to look at different tax systems, that are not easily evadable and that make us more competitive. I think they oughta look at a progressive value-added tax, just because — and I think it’s important that the American people understand this — most of our competitors have tax systems like this. If you have a value-added tax, you put a little revenue that’s collected — you lower the income taxes, corporate and personal — and you put a little revenue collector on every stage of sales in a product or service.
But if it is exported you don’t pay the last price…it’s exempt from the value-added tax. And, when a foreign good comes into this country they do pay the last stage of the value-added tax. So, when we export American products to countries with VAT taxes, our products pay that even though our corporations have already paid an income tax, already paid whatever other burdens. So if we could figure out how to do that, it would make us much more competitive with our exports. And, since I believe this cleansing process…this awful process we’ve just been through…gives us a great chance to bring manufacturing back in America, I’d like to see that looked at.
Then I think that the other thing that the other thing you’ve gotta do is you’ve just gotta be more disciplined in controlling spending. You just can’t…but it’s important to recognize that all these things are related. For example, if you don’t want Medicare to eat us alive. Medicare is a much more of a problem than Social Security, by the way. If you don’t want it to eat us alive you’ve gotta do something to stop the cost drivers in healthcare. We can’t keep doubling the cost of healthcare after inflation every decade.
So my view is control spending on an annual basis, work on healthcare costs, get more taxpayers, and try to have the most competive possible tax system. And eventually you’ve gotta really enforce these pay as you go rules. America..the American people have got to take responsibility too. They’ve got to know You just can’t keep saying you want more government than you wanna pay for, and borrowing more money from overseas. It’s just not right. It’s bad for our kids and grandkids. And it puts us in a very vulnerable position going forward.
We’re not, you know…Greece is vulnerable because they’re small, and they’ve been viewed as profligate. But, essentially in an international world where people can put their money in a nano second anywhere they want to, I simply don’t think we can afford to keep exploding this debt. And I think your gonna…the Democrats, we’re more socially progressive, but we’re also gonna have to be more fiscally conservative. I don’t think it’s fair to take any other course.”