News & Policies >
For Immediate Release
Office of the Press Secretary
July 24, 2003
President Discusses Economy, Child Tax Credit in Philadelphia
Financial Management Service Facility
11:14 A.M. EDT
PRESIDENT BUSH: Thank you all. Please be seated. Thank you all very much for allowing us to come. John, thanks for your leadership. He's doing a fabulous job as the Secretary of Treasury, and I'm so glad he decided to join my administration.
I want to thank you for the warm welcome, and I want to thank you all for helping us keep a commitment to the American people. We promised tax reductions for the good of American families and for the good of our economy. And we delivered on that promise. And soon the mail carrier will be delivering the checks that we promised to the American people. (Applause.) Twelve billion dollars in tax relief is on its way to more than 25 million American families.
And this is an appropriate place to come and talk about checks being mailed to American families, here at the Financial Management Service. The reason why is because here and at other facilities, these checks are being printed and the checks will be mailed. And I want to thank you all very much for working as hard as you are to make sure that the promise that the government has made is being kept.
I know a lot of you are putting in weekend shifts. I know a lot of you are working really hard. And I am grateful, but more importantly, the American people should be grateful for the work you do right here. Thank on behalf of -- (applause.)
I have traveled today with two really fine men and great United States senators, Arlen Specter and Rick Santorum. I want to thank you all for coming. I want to thank you for -- (applause.) I want to thank Mike Colarusso and Bob Mange for leading this fine group of folks. Thank you all for your hospitality. (Applause.)
I want to thank those good workers who allowed me and the press corps to come and see you doing your job. It's not easy to do your job with a distraction -- (laughter) -- and I must confess that sometimes the presidential entourage can be distracting. (Laughter.) But we want to thank you all for your hospitality, and most of all, thank you for being such great Americans and working so hard on behalf of the American people.
Today when I landed in Philadelphia, I met a lady named Valerie Christy. She's what we call USA -- there's Valerie, right there. I'm sure you don't know who Valerie is, but you're about to. Because Valerie is a person who has taken time out of her life to make somebody else's life better. She is a volunteer. One of the thing she's done is she has participated in the Philadelphia Cares Day, which helps to paint and repair public schools in Philadelphia. She also volunteers twice a month in what they call Partners in Technology, to help seniors and other special needs residents learn to use the technological change -- learn to adapt to the technological changes of our society.
In other words, and the reason I bring this up is, much has been made about the great strength and might of America -- and we are strong and we are mighty and we'll remain that way -- but the true strength of our country is the heart and soul of our citizens. And Valerie represents that. She represents those who have heard the call to love a neighbor like you'd like to be loved yourself.
And the reason I bring this up is I want to continue to remind our fellow citizens that the way to change America for the better, and the way to make sure the great promise of our country exists for every single citizen, is that when we see somebody in need, we must act. If you're worried about children not being able to read, mentor a child. If you have a shut-in in your neighborhood who is lonely, provide comfort and love to that person.
See, each of us can make a difference in America. America changes one heart, one soul, one conscience at a time. And each of us must be that some person trying to help make that change when we find somebody who hurts. Valerie, thank you for the example you set for our fellow citizens. (Applause.)
You know, this country has faced a lot of challenges in the past few years. And I believe those challenges have brought out the best in America. On September the 11th, 2001, a date I will not forget so long as I'm on this Earth, America's enemies declared war on this country. That's what happened on that day. It was a declaration of war by people who hate what America stands for. And war is what they got.
We are dismantling the al Qaeda network, leader by leader. We are finding these killers, one by one, and they will be brought to justice. (Applause.) We also acted in decisive ways to uphold doctrine. One of the doctrine said, if you harbor a terrorist, you're just as guilty as the terrorist. And so in Afghanistan, we recognized that there was a cruel and oppressive regime that had turned a nation into training camps. And so we removed that regime. And the people of Afghanistan are free.
In Iraq, a dictator was arming to threaten the peace. And he defied the demands of the world. He didn't defy just the demands of the United States, he defied the demands of the United Nations Security Council -- not once, but many times. And so, for peace and for the security of the free world, we removed that regime. And the Iraqi people are now free.
Our military is still facing danger from elements of the fallen regime and other extremists. These folks hate the thought of Iraq being free. And we're finding those people and we're bringing them to justice. Two days ago, in the city of Mosul, the careers of two of the regime's chief henchmen came to an end. Saddam Hussein's sons were responsible for torture, for maiming innocent citizens, and for the murder of countless Iraqis. And now, more than ever, the Iraqis can know that the former regime is gone and is not coming back. (Applause.)
Our people in uniform, our brave soldiers, are doing essential work in the war on terror. What they're doing in Iraq is an integral part on winning the war on terror. You see, a free and democratic and peaceful Iraq will not threaten America or our friends with illegal weapons. A free Iraq will not provide weapons to terrorists, or money to terrorists, who threaten the American people. A free Iraq will not destabilize the Middle East. A free Iraq can set a hopeful example for the entire region. And so the pursuits of freedom -- and as the pursuits of freedom replace hatred and terror in the Middle East, America and our friends will be more secure.
Our nation is incredibly grateful for the men and women who defend us, for the men and women who serve the cause of peace and security, and we are incredibly proud of those who wear our nation's uniform. (Applause.)
We have risen to challenges abroad, and we are rising to challenges at home, as well. When I took office, when my administration came into office, the stock market had been falling for months and the economy was sliding into recession. And so, we acted. And we passed tax relief, which made the recession one of the most shallow in history. We found that we had some of our corporate executives -- we found they weren't telling the truth. (Laughter.) They were being dishonest, not only to their shareholders, but their employees. And we acted. We'll punish those who violate the law, and we're working together with Congress -- and we worked together with Congress, and I signed the most historic corporate's governors reforms in a long period of time.
Last year, we saw that our economy was still not growing fast enough, or creating jobs we need. So we acted. We passed meaningful, real tax relief. We expanded the child credit from $600 to $1,000 per child. We made that change retroactive to January 1st of this year, which is why the checks are going out of this facility soon. In other words, we said, if we've got a problem, let's get the money to the people as quickly as possible. In the Jobs and Growth Act, that was the tax relief act, all aimed at increasing the capacity for our fellow citizens to find work. We brought down the marriage penalty. You see, we believe we ought to encourage marriage, not discourage marriage in the tax code. (Applause.)
We reduced all tax rates so our fellow citizens have got more take-home pay. That's good for the economy when people have more take-home pay. You see, by cutting individual tax relief, we passed tax relief, as well, for millions of small businesses, because most small businesses are what they call a sole proprietorship or subchapter S, which means they pay taxes at the individual income tax rates. So in other words, the tax relief not only helped our families and our citizens, but it also helped the small business sector of our economy.
And the benefits for this tax relief will be spread throughout all the economy. That's what's important for people to know -- it's widespread benefits. You see, because when people have more of their own money, more money in their pocket, they will demand a good or a service. And when somebody demands a good or a service in our system, somebody will produce the good or a service. And when somebody produces that good or a service, it means it's much more likely, as demand increases, that somebody will be able to find a job.
And that's what we're interested in. We're interested in creating jobs, so our fellow citizens can find work. More than a million Pennsylvania families will benefit from the increased child tax credit. And earlier I had a chance to talk with some of the families who have joined us today. See, I think it's very important for our fellow citizens to understand, we're not just talking theory. When people get checks, it changes -- it helps them with their lives.
The Lonabergers are with us. Barry says he wants to start saving more for his retirement and for the college education of his two sons, Kyle and Brandon, who are with us today. Where's Kyle? There they are, back there. He will get $800 soon, because of the increased child credit. His tax burden will drop by -- be cut by 29 percent because of the tax relief.
He -- so what does Barry say? He said, look, I'm interested in saving for my kids. He also said, this extra money will help on a summer vacation and he wants to renovate the kitchen in his home. So -- and he told me he's going on a vacation. See, that makes it more likely that somebody is going to find a job at the motel in the place where he's going. (Laughter.) And I'm sure he's going to eat when he gets there. So he'll take some of the money and he'll buy food. And that's good for the person who owns the restaurant and for the people that serve the food or cook the food.
And when he renovates his kitchen, he's going to have to buy some equipment to help renovate it, which means somebody is going to have to manufacture the equipment that he buys, to help renovate his -- or the paint, for that matter. In other words, it has an effect throughout our economy. Increasing the child credit helps Barry. But it also is going to help those who deliver the goods and services that he now demands as a result of having extra money in his pocket.
Brian Peffley is here today. Brian and his wife Heather have three sons, Caleb, Joshua and Noah. And they have got to make sacrifices. Every family makes sacrifices. And one of the things he wants to do is to obviously have more money for back-to-school expenses. People are beginning to think about what it means to send their child back to school.
One of the sacrifices he was going to make in order to make sure he could -- he and his family could purchase back-to-school expenses was he was going to delay taking a course he needed to get his bachelor's degree. And so what this means is, when he gets his check for $1,200, it will mean that he now can do both. And that's important. First of all, purchasing school supplies means the school supply manufacturer or school supply salesman has got a little extra business. But also, one of the things that's important in our work force is for people to continually upgrade their education, so that they can be more productive and find a better job that pays better pay. One of the things we want to encourage is additional education. And I appreciate the fact that Brian wants to go back to school.
Here's what he said. He said, this tax relief has eased the burden on us, and it will continue to allow us to achieve our goals and dreams. And that's what we want. We want people to have dreams in America and make it easier for them to realize their dreams.
Jeanette Luna is with us today. She, by the way, has the hardest job in America. She is a single mom. (Applause.) Adley is with us today. Eric is not here. But she earns a modest salary. And thanks to the tax relief, her refund will go from $600 to more than $1,100. And that will help pay for the school supplies. She's made the decision to send her child to a Catholic school, and that will help with tuition payments, which is important. It will help her buy clothes.
One of the things that's important is that tax relief helps people from all walks of life. And one of the things I've asked Congress to do, by the way, is to help low-income families like Jeanette's by making more of the child credit refundable. The benefits of the Jobs and Growth Act should be as broad as possible, should be widespread throughout our society. The House and the Senate have passed different versions of extending the child credit. They've got to resolve their differences and get it to my desk as quickly as possible, so people can get additional help.
Now, as John mentioned, the benefits of tax relief are positive. Economists, a lot of economists expect growth to pick up over the next 18 months. In other words, we've overcome a lot and we've laid the foundation for growth. And I'll tell you why they believe that. First of all, home sales are rising, and that's positive. We want, by the way, more people owning their own home. That's one of -- a grand objective for our economy. We've got a down payment plan to help people do that. We're trying to simplify the contracts so people don't get discouraged by the fine print.
But the best thing that's happening is, is that low mortgage rates have encouraged people to buy a home. And when you couple that with rising after-tax incomes, that's a positive foundation for home growth.
The other thing is people have refinanced their homes. In other words, lower mortgages mean that you can refinance and put a little extra money in your pocket for savings or needed purchases. Inflation is low, and that's positive. That's part of the foundation for economic vitality. Retail sales are rising, and that's good. Productivity amongst our workers is the highest it's been in a long while, and that's positive -- we're a more productive society.
Investors are showing more confidence. The stock market seems to be trending upwards. That's a positive sign. Since we're an ownership society, more and more people have got different retirement plans, and they count on the markets as part of their assets for retirement.
We've reduced taxes on stock dividends, and now companies have announced plans to increase their dividend payout. And some companies are going to pay dividends for the first time. And that's positive for our economy because billions of dollars in cash will now go directly to shareholders and back into the economy.
And so, we're making progress. The other thing we've done is, as I mentioned, small businesses get relief from tax relief, which is vital. And what's really important for -- to invigorate small business growth is most new jobs are created by small businesses in America. And therefore, it makes sense to have a policy that enhances the entrepreneurial spirit of America.
And so we did not only reduce taxes, but we also allowed for certain expensing of new equipment to encourage people to purchase new equipment. In other words, if there's an incentive for some small business to purchase a new piece of equipment, and they do, somebody's got to make the equipment. And when somebody makes the equipment, it is all part of making sure that there's job stability and job growth throughout our economy.
And so we've -- there are hopeful signs, good progress. But there is more to do. And one of the things we've got to do is to make sure that -- you know, we've got lawsuit reform. Listen, businesses are fighting a lot of frivolous litigation. And it's costly to our economy. And the House has taken up the reform of class-action -- the class-action system. And the Senate has not. In my judgment, in order to enhance economic vitality, the Senate must act on fair and balanced tort reform legislation, starting with class-action lawsuits.
We need a comprehensive energy bill. We've got to have a policy, a comprehensive energy policy if we want our economy to grow. I'm concerned about the costs of natural gas. The demand is strong for natural gas, and supplies are not as plentiful for natural gas, which means there's price pressure. The House has acted on this important piece of legislation; the Senate hasn't. We need an energy bill that promotes conservation, that applies new and cleaner technologies, but one that improves national security by making us less dependent on foreign sources of energy.
We need to expand trade so our farmers and ranchers and manufacturers have got new markets. Listen, if you're good at something, you want to be able to sell what you're good at all around the world. And we're really good at a lot of things, and we ought to be encouraging markets to open up for United States products. That's important for job creation.
The other thing is that as we create new job opportunities, we've got to help the people be prepared to fill those job vacancies. And so I proposed what we call reemployment accounts. It gives Americans a chance, particularly those who are having the greatest difficulty finding work, to realize their dream of work. People get $3,000 to use in their job search. Now, that $3,000 should be used according to the needs of the people, not according to what the government thinks their needs are. So if a person needs child care, they ought to be able to use that money. If a person needs transportation, they ought to be able to use that money. If a person needs extra training, they ought to be able to use that money. If a person finds a job in another part of the state, they ought to be able to use that money to help them move.
In other words, this is focus money, called reemployment accounts, to help people get ahead. When we expand this economy, we've got to recognize that some people need training and help to enter in that work force.
And the other thing I said, if a worker believes -- a worker can find work within 13 weeks, and there's still money left over of the $3,000, they can put it in their pocket as a reemployment bonus. Congress needs to look at this idea, need to act. They've got to understand that as we expand the economy, some of our citizens need some focus and some help.
And one of the things you hear talk about is the deficit. And we've got a deficit. We've got a deficit because revenues to the Treasury have dropped as a result of recession. And we've got a deficit, as well, because I'm spending the money necessary to win the war. My attitude is when we put our troops in harm's way, they deserve the best. When we've got people overseas defending us -- (applause.) I also firmly believe that as the economy -- I know as the economy grows, there's going to be more revenue coming into the Treasury. And the tax relief as I've described to you will help the economy grow.
The best, surest way to make sure we deal with the deficit is to make sure we don't overspend in Washington, is we have a reasonable increase in discretionary spending. And I proposed Congress stay within a 4-percent increase of discretionary spending. It's about the same amount that the average American household budget will increase this year. It seems to make sense to me. If it's good enough for American families, it ought to be good enough for the appetite of the Congress. (Applause.)
The good news is they voted for that number, and now we expect them to hold the line. And I believe with economic growth and spending discipline, we can cut the deficit in half over the next five years. And that's progress.
What I hope you come away with is that I believe in the future of this nation, and I believe the economy is strengthening, is going to be strong, because I know the character of the American people. In 22 months -- think about this -- in 22 months our nation has been tested by a national emergency, by corporate scandals, by a recession, and by war. And time after time, this country has responded effectively to each challenge we faced. Time after time, we have shown firm resolve and unshakable faith in our country. (Applause.)
And the basis of the Jobs and Growth Act, the kind of fundamental principle of the Jobs and Growth Act is that I've got faith in the American people, in the strength and the enterprise and the creativity of the American people. And I believe with hard work and determination, this economy is going to be strong. We're headed in the right direction. Better days are ahead for our citizens.
Listen, thank you for letting me come. May God bless. Thank you all. (Applause.)
END 11:40 EDT