Remarks and a Question-and-Answer Session With Reporters on Signing the Veto Message for the Farm Credit and African Famine Relief Bill

The President. I am not signing the piece of legislation that came down to me today. I am signing a veto.

[At this point, the President signed the veto message to the House of Representatives.]

And I would like to make a statement with regard to that to my fellow Americans. And they all know some of our farmers are facing severe financial problems. They're living with the results of a generation of failed policies that drove down farm prices, drove up the cost of their land, seed, and equipment. And then in the late 1970's, they were hit again by runaway inflation and interest rates, grain embargoes that robbed them of long-term markets.

Farmers who've toiled to make America productive, growing food and fiber for all of us and millions beyond our shores, deserve our sympathy and our support. And the Federal Government mustn't shirk its responsibility to help undo some of the damage that it created. And with spring planting upon us, we're meeting that responsibility.

Last September we initiated a carefully targeted effort to direct special help to farmers with credit problems. And just last month we modified this new program to ensure its effectiveness.

This year, under plans that I approved, the Federal Government will make nearly $41/2 billion in credit available to farmers. We will also spend just over $15 billion to support the price of farm commodities. We're doing a great deal to help farmers. But I've pleaded and warned repeatedly that, just as your families don't have a blank check for whatever your needs may be, neither can government—and that means taxpayers—bail out every farmer hopelessly in debt or every bank which made imprudent or speculative loans and bet on higher inflation. I asked for help. I asked Congress, which just days ago was bemoaning the size of deficits, to demonstrate courage—hold the line and match rhetoric with deeds. Congress failed. In the first major bill since convening in January, a majority proved itself incapable of resisting the very tax and spend philosophy that brought America to its knees and wrecked our economy.

So, today I have vetoed this massive new bailout that would add billions to the deficit over the next several years. And let's be clear on one thing: The bill I vetoed would not really help farmers; it's too late in the season for that. This bill is merely designed to convey the impression of helping farmers.

But if Congress wants to help, it will help us reduce unnecessary spending and increase incentives for greater real economic growth, which will provide confidence to the markets and help interest rates come further down.

Let me add that my veto will not interfere with the African relief effort now underway . Using authority and existing law, we can maintain the flow of emergency assistance.

The bottom line is that someone in Washington must be responsible. Someone must be willing to stand up for those who pay America's bills. And someone must stand up to those who say, "Here's the key, there's the Treasury, just take as many of those hard-earned tax dollars as you want."

I applaud and thank the 35 Senators and 168 Members of the House who courageously stood with me on this issue. And now that I've vetoed this bill, I hope the Congress will get the message and work with me to reduce spending in a responsible way that does not threaten our national security. If it doesn't, then I'll do what must be done. I will veto again and again until spending is brought under control. So, please help me by telling your representatives to stop talking about deficits and to start helping me bring them down.

Thank you. God bless you.

Q. Mr. President, are you confident that this veto will stand up in Congress?

The President. Well, I believe if those in Congress vote as they voted for the piece of legislation and if they vote that same way with regard to a veto, yes, it will be upheld.

Q. The Democrats say that the farmers who voted for you are going to feel betrayed and are going to take this out on other Republicans. What do you think the political fallout of this will be? Aren't you hurting Republicans?

The President. Well, the thing is, if the farmers would only consider this, they would recognize that we are helping. I've just given the figures there—$41/2 billion that's already planned for their help, plus $15 billion. We have spent $50 billion on aid to farmers in the last 4 years. More than that in the last 3 years, as a matter of fact.

And what I said in there with regard to figures doesn't touch on the additional program that in September—Secretary Block initiated several new issues: a 5-year set-aside of up to 25 percent to a maximum of $200,000 of a FmHA borrower's interest payments; $650 million in guarantees for refinancing up to 90 percent of the restructured commercial loans, provided the private sector lender writes off 10 percent of the principal or interest on the loan. Now, up till now, only about $25 million of that 650 has been used—has anyone sought it.

And then on February 6th, Secretary Block initiated additional measures to build upon the September initiatives: The Farm Credit Coordinating Group, chaired by him, will make sure that all Federal credit agencies work closely together to solve the farm liquidity problems; modified Federal regulations will make it possible for banks to work out lower payments for farmers having liquidity problems; and guarantees of up to 90 percent of operating loans will be provided for eligible farmers whose local banks fail and who can't find a new private lender without such a guarantee. Now, some lenders have been unwilling to participate in this program, but that was due to the uncertainty about whether something better might come out of the Congress. But these are the things we're doing.

The truth of the matter is: In need of immediate help are less than 4 percent, or around 4 percent at best, of all the farmers in the United States; 96 percent do not have any liquidity problems.

Q. Well, the Democrats seem to think they have a pretty hot political issue. Do they?

The President. Well, I would rather treat with the issue as it relates to our own financial problems with the Federal Government and not as a political issue.

Q. Do you think they're playing politics with it, sir?

The President, You'll have to ask them. But I certainly don't think that tying this to a bill on food aid for the starving people in Africa was exactly the way to go in this kind of legislation. As a matter of fact, it emphasized the real need for a line-item veto.

Q. Mr. President, would you sign the food aid bill if the farm provision was stripped away?

The President. Yes. But again, let me reiterate what I've said that as of right now there is going to be no interruption of the aid that we're giving because of funds that are already available.

Q. The Senate Budget Committee yesterday voted to cut your defense budget by $11 billion. Doesn't that show a lack of support for your defense program just as we're going to Geneva?

The President. Well now, Chris [Chris Wallace, NBC News], I took your questions here that had to do with the issue of the day, and I'd rather limit it to that. And I think I should, rather than we get into a general press conference. There'll be time coming up for us to talk about those other things.

Q. Well, it is Congress.

The President. What?

Q. It is Congress.

The President. Yes, but I've been meeting and—with a great many of them on both sides of the aisle—and there's evidence of some willingness to stand together on these other matters. So, if you don't mind, I'll make my way out the door now, all right.

Q. Mr. President, do you think it's appropriate for Mr. Deaver and the others to have taken a discount on those cars?

The President. Now, that's another question that doesn't have to deal with the farm problem.

Q. Well, would you nod or shake your head?

The President. But you're talking about something that has gone on for a great many years, that exists in our Embassies in all other countries. It's a standard practice that's been used for many, many years.

Q. So, you see nothing wrong with what he did, sir?

The President. No.

Reporter. Thank you.

The President. Yes, thank all of you.