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Remarks on the Earned-Income Tax Credit and an Exchange With Reporters

March 09, 1994

The President. Thank you very much, Mr. Vice President, other members of the administration.

The earned-income tax credit is an important symbol of the core commitment of this administration to promote the values of work and family and community and to help people who work hard and play by the rules. It's been the driving force of everything we have tried to do since we took office, from bringing the deficit down to working to help create over 2 million jobs, health care reform to welfare reform, all the other things we are doing.

This earned-income tax credit can help to improve the lives of working people all across the country by lifting them above the poverty line. You all know that millions and millions of working people now have had stagnant wages for virtually two decades, that more and more people work hard and their wages don't keep up with inflation. The principle behind what we are doing with the earned-income tax credit is simple: If you work for a living, you shouldn't be in poverty.

This year across our Nation, 14 million Americans will claim the credit when they file their 1993 tax returns. So we know that will help a lot of people in need. But we think there are some more things we can do. The vast majority of the millions of Americans who qualify receive their money in a lump-sum payment, like a refund, after they file their taxes. But many of them, if they have at least one child at home, could be receiving the benefit for the current year right now in their regular paychecks. By simply filling out a form with only four yes-or-no questions, the W-5 form, qualifying workers could be collecting as much as 60 percent of this benefit due them in this way spread throughout the year. That means extra money when they need it to pay for groceries or clothing or just to make ends meet between paydays.

We want qualifying Americans to know about this option. In the coming weeks we'll be getting the word out to employers everywhere, but today we're starting here in our own backyard. In the Federal Government, believe it or not, hundreds of thousands of workers are eligible for the earned-income tax credit. We want eligible Government workers to be an example of how this program can be used.

So today I am sending a memorandum to all Cabinet Secretaries and agency heads, instructing them to get that word out, to get their personnel and payroll offices on board so that Government employees know about the advance payment option for this earned-income tax credit.

It's our responsibility to help the people who need it and who have earned it. This is not a handout. It's a helping hand. That's an important distinction. It gives some breathing room to people who, day-in and day-out, have done everything they could to take care of their families, to make their own way, to be self-supporting taxpayers.

I've met with many families already who've benefited from this credit, and for some, it's helped with the most basic needs, food, clothing, shelter. For others, it's helped to bridge the way from being a semiskilled job holder to a better life with a better training program and a better income. For still others, it's just an incentive to keep going. This program works.

Let me say that this year, because of our economic program which passed, as you know, last year, beginning in 1994 we will increase the number of people eligible for the earnedincome tax credit from 14 million people to almost 20 million people. And in addition to that, the size of the benefit will begin going up rather dramatically, phased in from this year to all future years.

But what this means as a practical—for the next 4 or 5 years, when it goes up, what this means as a practical matter is that a person with a marginal income, working hard, eligible for 60 percent of this benefit every month might literally get another $100 a month to help feed children or clothe them or meet basic family expenses. It is a very important distinction. And I want to emphasize that on the terms of getting the benefit every month, those people will qualify for the increased benefits, and there will be more people qualifying this year because that applies to 1994. So it's very, very important.

I'm going to sign this Executive order and then ask Secretary Bentsen and our IRS Commissioner, Peggy Richardson, to talk about what they're going to do.

[At this point, the President signed the memorandum. Secretary Bentsen and IRS Commissioner Richardson then made statements.]

The President. Let me just say one other thing to kind of reiterate this. To give you some idea about the numbers of people we're talking about in America, starting this year, about 83 percent of the American people will pay the same income tax rates they've been paying, adjusted for inflation; about 1.2 percent will pay a higher rate; and about 16.6 percent of total taxpayers in the country are eligible for a tax reduction. Those with children are eligible to get the monthly benefits as well as the lump-sum payment at the end of the year. This is basically an income tax cut in the form of a credit. So it's a very significant thing, one in six American taxpayers eligible for this benefit.

President's Income Tax Returns

Q. Mr. President, can you tell us what——

The President. What? What did you say?

Q. Have you paid your taxes yet?

The President. No, I haven't filled out my returns yet, I don't think. I hadn't signed my return yet. I always get——

Q. It's not April 15th.

The President. Not time yet. They'll be filed in a timely fashion. And you'll see them, as you always do.

Richard Nixon's Visit to Russia

Q. Mr. President, can you tell us what you think of Boris Yeltsin refusing to see Richard Nixon? Did you tell Richard Nixon it was okay with you if he met with former Vice President Rutskoy and the other opposition leaders?

The President. I did, yes. He told me he wanted to do that because, as a non-Government official, he felt that it was an appropriate thing for him to do, basically going to Russia on a fact-finding mission to listen to people who had views very different from not only the Russian Government, from his own and from my own. And he said he thought he was in a different position from me, for example, and I agreed that he was in a different position. So he said that's what he intended to do. And I told him that was—I would be interested in hearing his report when he got back.

Q. What do you make of Boris Yeltsin refusing to see Richard Nixon as a result?

The President. Well, of course, you have to— it's up to President Yeltsin whom he sees and doesn't see. I wish he would see him because I think they'd enjoy talking to one another. And I think Richard Nixon is basically quite sympathetic with the dilemmas faced by Boris Yeltsin and generally quite supportive of his administration. So I would hope that he will see him, but I don't think it's, you know, it's not the end of the world.


Q. Mr. President, how do you feel about the pullout, now, of all the troops from Somalia?

The President. Well, first, I want to compliment our military people; they are doing an excellent job. They've handled it very well. And I think, as I have said all along, you know, this was originally—if you go back to 1992, this whole mission was billed as a humanitarian mission. And the first time President Bush spoke with me about it, he said he thought maybe they would be out before I was inaugurated or by the end of January. And what we learned from that, of course, is that at least in the case of Somalia and many other cases, you can't have a humanitarian mission divorced from the political problems of the time. The people in Somalia were starving not because there was no food that could be given to them, they were starving because of the political and military conflicts consuming the country.

The United States, and then the United Nations, went in there to give the people of Somalia a chance not only to save lives, restore normalcy, end starvation but to give them a chance to work out their own problems in a different way. And I think we have given them that chance. The American people have been very generous with their money and with their support. We have lost some of our most precious resources, our young people, in Somalia because of the nature of the conflict. And I think we have done our job there and then some. And I feel very——

Q. But the civil war will resume there.

The President. Well, we don't know that. I mean, they still—that's up to them. But there's civil wars in a lot of countries in this world that we have not made anything like the effort for we've made in Somalia. There's a civil war in Sudan; there's a civil war in Angola; there were lots of people killed in Burundi. I mean, that's just in Africa, never mind all these other places.

So we have made an extraordinary effort, the United States has, to help the people of Somalia. And the leaders there now have a choice to make. There are still United Nations forces there. They're still in a position to guarantee the availability of food and medicine and a more humane life. And they will have to decide whether they care more about that and care more about their people and seeing their children healthy, or whether they want to let the country be consumed in war again. But they have to take some responsibility now. The responsibility is shifting back to the leaders there on the ground. And they ought to work it out. They ought to prefer the life their people have had the last 14 months or so, 15 months, to what they had before. But it's up to them.

Richard Nixon's Visit to Russia

Q. Mr. President, back on Russia, can you tell us about your conversation with Mr. Yeltsin? He seemed to suggest that you agreed with him on the Nixon visit. Did you talk with him about this?

The President. Mr. Yeltsin?

Q. Did you talk with him or with anyone?

The President. I don't believe—I don't think Boris Yeltsin and I discussed President Nixon's visit. I don't believe we did. You know, I talk to him on a fairly regular basis, but I think the last time we talked we were talking about Bosnia, and I don't think we had a conversation about it.

But I did talk with Richard Nixon, President Nixon, before he went there. And he raised this prospect of meeting with some of the opposition leaders. He said he thought it would be interesting. He wanted to get a feel for where they were and what kind of people they were. And again, he said he was not in the Government of the United States; he was in a different position. And I said I had no—he should meet with whomever he wanted and I'd be interested to hear his reports when he got back.

Q. But you don't think it's a diplomatic insult for Richard Nixon to have seen these other leaders, opposition leaders?

The President. No, because he's not in the Government. You know, he's not even—he was over there on a fact-finding mission, and as I said, Richard Nixon has been extremely supportive of this administration's Russia policy, which has been extremely supportive of President Yeltsin and his objectives. So I think he's been, in that sense, as an American citizen and a longtime expert on that area of the world, he's been very supportive of the objectives of President Yeltsin, and I think it should be seen in that light.

Again, I can't speak to whatever the dynamics are in Russian domestic politics at this time and whether that is having any impact on President Yeltsin's decision. I can't speak to that. But all I'm saying is that I think that President Yeltsin should not assume that Richard Nixon is not friendly toward his administration and toward democracy and toward reform, because quite the contrary, he's been a very strong supporter of our policy for the last year. And I wouldn't overreact to the fact that he met with some people who are in opposition to President Yeltsin.

Thank you.

Whitewater Investigation

Q. Mr. President, what advice do you have for top aides who are appearing in Federal court about Whitewater and——

The President. Just the same advice I give everybody, you know, just tell them what happened, answer the questions, and go on. Be very open.

NOTE: The President spoke at 10:50 a.m. in the Oval Office at the White House.

William J. Clinton, Remarks on the Earned-Income Tax Credit and an Exchange With Reporters Online by Gerhard Peters and John T. Woolley, The American Presidency Project

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