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October 27, 1999: Largest Budget Surplus In History

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"Today's good news is a result of hard-won economic choices that put our people first. That strategy has created the most prosperous economy in generations."

President Bill Clinton
Thursday, October 28, 1999

Today, at the White House, President Clinton announced that the Office of Management and Budget and the Department of the Treasury have released figures showing the largest budget surplus and the largest pay-down of debt in history The President urged Congress to keep our nation on course by passing his budget plan that protects Social Security, pays down the debt, and meets the nation's priorities in the areas of education, health care, crime, and the environment.

Clinton-Gore Economic Plan Is Working. In 1993, President Clinton put in place a three-part economic strategy of fiscal discipline, investing in people, and opening markets abroad. Today's figures provide even more evidence that the Administration's strategy is working:

The Largest Surplus in History:

  • The $123 billion surplus in 1999 is the largest dollar surplus in history, even after adjusting for inflation;
  • The surplus, expected to be about 1.4% of GDP, is the largest surplus as a share of the economy since 1951;
  • 1999 is the second year in a row of surplus, marking the first back-to-back surpluses since 1956-57;
  • This is the first time in U.S. history that we've experienced seven years in a row of fiscal improvement.

The Largest Debt Reduction in History:

  • Over the last two years, America has paid down $140 billion in public debt, the largest debt pay-down ever;
  • The debt held by the public is $1.7 trillion lower than was projected when President Clinton took office;
  • As a result, in 1999 alone, interest payments on the debt were $91 billion lower than projected.

What Debt Reduction Means for Americans. Paying down the debt means:

  • Lower interest rates cut mortgage payments by $2,000 for families with a $100,000 mortgage;
  • Lower interest rates cut car payments by $200 for families with a car loan;
  • Lower interest rates cut student loan payments by $200 for a person with a typical student loan;
  • Businesses have more funds for productive investment;
  • Rising investment has contributed to an increase in productivity.

President's Budget Pays off Debt in 15 Years. Under President Clinton's budget plan, the publicly held debt would be paid off by 2015, resulting in:

  • elimination of interest payments on the debt;
  • more funds available for increased Social Security and Medicare costs for baby boomers;
  • more funds available for investment;
  • lower interest rates;
  • increased worker productivity and income.

Urging Congress to Stay with What Works. President Clinton warned that proposals by Congressional Republicans for irresponsible tax cuts, spending the Social Security surplus, and across-the-board spending cuts would threaten our continued prosperity. The President urged Congress to keep America on this course of progress by passing his budget plan, which pays down the debt, protects Social Security, strengthens and modernizes Medicare, and invests in national priorities like education, health care, public safety, and the environment.

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