President Bush Visits Nashville, Discusses Budget

July 19, 2007,11:35 A.M. CDT,THE PRESIDENT: Thank you all for coming. I'm glad you're here. Thanks, Darrell. Are you sure you want the federal government moving to Nashville? (Laughter.),Thanks for the invitation. I've got some thoughts I'd like to share with you, and then if you've got some questions, I'd love to answer some. My job is the Commander-in-Chief and my job is the Educator-in-Chief, and part of being the Educator-in-Chief is to help our fellow citizens understand why I've made some of the decisions I've made that have affected¹ your lives. So thanks for letting me come.,fiscal²⁷ responsibility. White House photo by Chris Greenberg" src="/upimg/allimg/20070728/1055070.jpg" width="255" align⁷⁸="right" border="0" /> Here we are in the presidential ballroom² -- smart move, Darrell, to pick a presidential ballroom. (Laughter.) I'm sorry Laura is not with me. She is, first of all, a fabulous³ woman. She is a patient woman. And she is doing a marvelous job as the First Lady. (Applause.),I want to thank Ralph Schulz, the president and CEO of the Nashville Area Chamber⁴. I thank the business leaders who have allowed me to come and visit with you. You do have an exciting city here. This, of course, is not my first time here -- I can remember being here in the Opryland hotel complex when I was the owner of the Texas Rangers⁵ baseball team. And I can remember coming here for my mother and father's 50th wedding anniversary. They had a bunch of country and western singers sing to honor the 50th wedding anniversary, and it was a special time. And you're right, you've got a fabulous city here.,I have just come from the Harrington's company, a small business here, the Nashville Bun Company. (Applause.) And I know that some of the employees from the Nashville Bun Company are here. Thank you for being here today. It's quite an operation. I love going to small businesses because the small business sector⁶ of our economy is really what drives new job growth. If the small businesses are doing well in America, America is doing well.,And so I went by to see this operation, and I want to spend a little time talking about small business growth, if you don't mind. So I want to thank the Harrington -- good, solid Tennessee citizens who are entrepreneurs, risk takers, dreamers. (Applause.),I don't intend to talk about this war against radicals⁸ and extremism in my remarks. If you've got questions, I'll be glad to answer them. I do want to, though, pay homage⁹ to those who wear the uniform. I'm honored to be with you. Thanks for serving the country. (Applause.),Cordia asked me in the limousine¹⁰ coming over here, have you had any amazing experiences as the President? And, yes. (Laughter.) I told her there's no more amazing experience than to meet those who have served in harm's way and to realize the strength of spirit of American citizens who volunteer during a time of danger. And one of the young men I have met during my presidency¹¹ -- I did so in my home state of Texas -- who is with us today, a man who is recovering from terrible injury, but has never lost the spirit of life: Kevin Downs. (Applause.) He's a good man. We're going to get him some new legs, and if he hurries up, he can outrun me on the South Lawn of the White House. Proud that Kevin's mom and dad are here with us, too., I want to spend a little time on the economy -- more particularly, the budget. You've got to worry about your budgets; we've got to worry about your budget, too, since you're paying for it. (Laughter.) There's a philosophical¹² debate in Washington, and really it's kind of to calibrate¹³ how much money we need and how much money you need. Some say we need more of your money to expand the size and scope of government, or, they would argue, more of your money to balance the budget. Then there are those like me in Washington who say, there's ample money in Washington to meet priorities, and the more money you have in your pocket, the better off the economy is. In other words, let me put it bluntly: I think you can spend your money better than the federal government can spend your money. (Applause.),Part of my job is to deal with problems. And I try to do so with a set of principles in mind. A principle is, you can spend your money better than the government can, but a further principle is, if you have more of your money in your pocket to save, invest or spend, the economy is likely -- more likely to grow.,We were confronted -- this administration has confronted some difficult economic times, particularly earlier in this administration. There was a recession. There were the terrorist attacks that affected the economy in a very direct way. There were corporate¹⁴ scandals which created some thousand -- uncertainty¹⁵ about our system that needed to be corrected. And we responded to those problems by cutting taxes.,See, if you believe in the principle the more money you have -- and all of a sudden you see some rough, economic times, act on the principle. So I worked with Congress and we cut taxes on everybody who pays taxes. On one of these tax cuts -- said, okay, you deserve a tax cut, but you don't deserve a tax cut. It was the belief that everybody who pays taxes ought to get tax relief.,And as you can see from this chart here, this is what the tax cuts have meant in 2007. But ever since they have been enacted¹⁶, it has got the same type of effect. So if you're a average taxpayer¹⁷, you're receiving $2,200 of tax relief. Some receive more, some receive less, but the average for all taxpayers¹⁸ is $2,216., See -- and the fundamental question is: Does it make sense to have the average taxpayer have that money in his or her pocket? I think it does for a lot of reasons: It encourages consumerism, it encourages investment, it enables people to be able to put money aside for a family's priorities. You don't want the government setting your priorities; you set your own priorities. And if college happens to be a priority of yours -- if you want to save for your little guys coming up -- here's some money for you to put aside. That's what the tax relief meant.,There's obviously more tax relief for married families with children because there's the child credit. I thought it makes sense to say, if you've got a child, you ought to get credit for that child when it comes to the tax code to help you raise the children. You know, we put the -- did something on the marriage penalty. Imagine a tax code that penalizes¹⁹ marriage. That's what the code did earlier on and we mitigated²⁰ the marriage penalty and the tax code. We ought to be encouraging marriage, not discouraging marriage through bad tax policy. (Applause.),The Nashville Bun Company folks are organized so that they pay tax at the individual income tax level. A lot of small business owners know what I'm talking about. If you're an LLC or Subchapter S, you don't pay corporate tax, you pay tax at the individual income tax rates so that when you cut taxes on all who paid income taxes, you're really cutting taxes on small business owners as well. And if most new jobs are created by small businesses, it makes a lot of sense if you're dealing²¹ with economic problems to cut the taxes on those who are creating new jobs.,The more money in the small business's treasury²², the more likely it is they'll be able to expand. And when they expand, the more likely it is they'll be hiring new people. We also put incentives²⁴ in the tax code that said if you purchase equipment -- you're a small business owner and you purchase equipment, like the English muffin rolling deal or whatever you want to call it -- (laughter) -- getting out of my lane here -- (laughter) -- we provide an incentive²³ in the tax code to encourage you to purchase equipment. That not only helps your business become more productive and more competitive, the more productive and competitive you become, the more likely it is you'll be able to sustain growth and, therefore, continue hiring.,But it also means that the English muffin manufacturing company -- English muffin machine manufacturing company is more likely to have work. In other words, there's an effect, the tax code can affect commerce. And that's exactly what we did, and we cut the taxes and it's worked. This economy is strong. Unemployment has dropped. Since August of 2003 we've added over 8.2 million new jobs. Productivity is up. People are working. (Applause.),People are working. And that's what we want. We want people to say, I'm making a living for my family, and I've got more money in my pocket so I can make decisions for the best of my family. And I'm going to spend a little time, if you've got any questions, on how to keep it going strong.,But I now want to talk about the budget. People say you can't balance the budget if you cut taxes. That's one of the arguments in Washington, D.C. I think all of us would like to balance the budget. But they're saying, I'm going to raise your money -- raise your taxes so we can balance the budget. There's a flaw in that argument. And that is, most of the time they raise taxes on you, they figure out new ways to spend the money, as opposed to reckon it to deficit²⁶ reduction. I've got a better idea that I want to share with you and share with the American people. And that is, the best way to balance the budget is to keep taxes low, growing the economy, which will yield more tax revenue into the economy. And it works, so long as you hold spending down. And that's the most important thing, is to keep taxes low and spending down.,And I got a chart here I'm about to show you. Yes, there you go. And so I submitted a budget based upon no tax increases and being fiscally²⁸ wise with your money. And here's the record of that plan. As you can see there, we had a deficit of $413 billion in 2004. This economy started picking up steam -- kept the taxes low -- and tax revenues started coming in, and then the deficit dropped to $318 billion, and it dropped to $245 billion, and it's anticipated it's going to be $205 billion in the year 2007. You can see the projection²⁹. We've done this without raising your taxes. We've done this by saying keep taxes low, keep the economy growing, and be wise about how we spend your money.,I project -- we project if we can continue to have fiscal sanity³⁰ in Washington, D.C., that we'll be in surplus by the year 2012. That's where we're headed. And I believe we can do so without penalizing³¹ the small business sector -- or the large business sector, for that matter. And particularly we can do so without penalizing the families and individual taxpayers in the country. But that's the argument.,Now, the Democrats³² have submitted their budget. Put up the next chart. Oops, that's my budget. (Laughter.) This is non-defense³³ discretionary spending. This is what we propose, see. We go to Congress and say, here's our budget proposals. We're going to make sure our troops have what it takes to win this war against these extremists and radicals. That's what the American people expect. (Applause.),So this is my proposal, and I'd like to show you what the Democrats have proposed. Here's their proposal. They've added billions of dollars in new spending on the budget they submitted. The reason I'm -- this is not a -- I'm not bashing anybody. I'm just -- what I'm here to do is educate you on the different approaches to how we're dealing with your money when it comes to the federal budget. And as you notice, there is a -- quite a disparity about the different approaches of how much money ought to be spent. You can't pay for the red lines unless you're willing to raise taxes on the American people. I would call that a return to the tax-and-spend days. I have showed you our budget to get to surplus, and it requires this level of increase in spending, the blue.,The people now in charge of the House and the Senate have submitted their own budgets; their own blueprint³⁴ for how we should spend your money, and it's reflected in the red lines. Now, you can't grow the economy fast enough to get to the red lines. And, therefore, the only way to do so is to run up your taxes.,I'd like you to see the next chart, if you don't mind. This is the tax increases inherent in a different approach. As you can see, will raise taxes $392 billion over five years, and with a $1.8 trillion increase in taxes in order to make the budget projections³⁵ that they have spent. I would warn the Nashville Bun Company to be very careful with this kind of approach because you can't keep making buns if the Democrats take all your dough³⁶. (Laughter and applause.),I don't disparage³⁷ anybody; there's just a difference of opinion. Part of my job is to make it clear to people that there are choices to make. And people have got to understand this budget process. You know, we're throwing around huge numbers in Washington, D.C. And the reason I've come today is to clarify the difference of opinion so you can make your own choice about the right approach. I've obviously got my choice, but the American people need to know the facts so they can make up their mind as the best approach to dealing with the finances of the United States today and tomorrow and for the next decade to come. This is the tax increases that will be required under one vision of dealing with your money -- and here's my view of what we ought to do on taxes. (Applause.),And, of course, the comparison. (Laughter.) We don't need to raise your taxes in order to balance the budget. We shouldn't raise your taxes in order to balance the budget. As a matter of fact, we ought to keep your taxes as low as possible to make sure this economy continues to grow. (Applause.) So you'll watch this budget process and the appropriations³⁸ process unfold here. And it's really important for the leadership in Congress to pass the appropriations bills -- that's the spending bills -- as quickly as possible. There are 12 spending bills that are supposed to get to the President's desk.,And they need to be passing these things; they need to be doing the people's business in Washington, D.C. They need to have an honest debate about the appropriations for the different departments that they're dealing with -- an open, honest debate. They ought not to be trying to slip special spending measures in there without full transparency and full debate -- those are called entitlements. And they ought to be wise about how they spend your money, and they ought to get these appropriations bills to my desk as quickly as possible, and not delay.,Now, I will tell you that there's an interesting relationship between the President and the Congress. The President [sic] has got the right to initiate³⁹ spending bills -- and they do; they've got the right to decide how much money is spent. And I've got the right to accept whether or not the amount of money they spend is the right amount. That's what's called the veto. If they overspend or if they try to raise your taxes, I'm going to veto their bills. (Applause.),So I'd like -- I appreciate you letting me come and give you a little budget discussion. But I thought it would be appropriate, if you don't mind, to answer some of your questions, any question, I'd be glad to answer them. I've been there for six and a half years, if I can't answer them, I can figure out how not to answer them. (Laughter.),Yes, sir.