Radio Address to the Nation on Deficit Reduction and Taxation

My fellow Americans:

Lately, you may have heard a lot of talk about a so-called secret plan to raise your taxes. Well, I've made it clear that we have no such plan. But apparently, such a plan exists, nonetheless. It's not our plan; it's not yours. It's the plan of the Democratic nominee for President.

When he accepted the Democratic nomination, he declared that he will increase your taxes. He said it several times since. But he still hasn't said exactly how. He has, however, come close to saying how much he would raise your taxes.

It takes a little calculation, but here's how it all adds up. The Democratic nominee has said he accepts deficit projections of over $200 billion a year, as far as the eye can see. Now, I don't accept them. And if we can keep our economy growing strongly, no one will have to. But he says he accepts them.

On top of those deficit projections, the Democratic nominee says he would add new government spending. How much? Well, he says his increases would total about $30 billion per year.

Senator John Glenn, on the other hand, said the cost of the Democratic nominee's promises would really come to somewhere between $90 and $170 billion. The Wall Street Journal reported estimates of experts that the amount of increased spending would come closer to $90 billion. So, let's use that for working purposes.

The Democratic nominee says he will make some budget cuts. He says he'll cut defense, health care, and agriculture programs by a total of $55 billion to $65 billion. And although his plan isn't likely to produce them, he says he expects interest savings of $15 billion to $20 billion. Now, that would bring his total savings to less than $90 billion. So, when you add it all up, the Democratic nominee's savings, assuming he would achieve them, still don't quite add up to enough to pay for the likely cost of his promises. And the deficits would be even higher than he assumes, except for one thing—there's another element to all this, another promise.

The Democratic nominee says he'll cut those deficits by two-thirds. How? By raising taxes. He says he estimates increased taxes of "at least $60 billion." He says he would get these by doing such things as deferring indexation, capping the third year of your tax cut, and adding a tax surcharge-all supposedly targeted at higher income taxpayers. Well, the truth is he'd need an increase of more than twice $60 billion, an increase of $135 billion square with his promises. That $1,500 in increased taxes for every can household, and one way or another, that means you. It's the same tired old formula-tax and tax to spend and spend.

I think the Democratic nominee owes the American people not a partial explanation, but a full explanation of how and where he expects to get that $1,500 more per household, over $135 billion in increased taxes. That's the secret that should be brought to light.

My approach to deficit reduction is entirely different, and it's no secret. We should reduce deficits first and foremost by continuing our economic growth and by reducing wasteful government spending.

Through the Grace commission, for example, we've developed 2,478 recommendations of possible ways to reduce spending without hurting the needy. These recommendations are no secret. We've made them public. We've already begun to implement almost 20 percent of them. We're still completing our review of the rest, but they're there for all to see, and every one that is worth implementing will be implemented.

As for taxes, my approach there is also well-known and no secret. We have already reduced personal income tax rates for all Americans by 25 percent. That has not only lightened your burden, it's helped give us the strong economic growth, without inflation, that we now enjoy.

Our tax cuts have meant more money for you to spend and invest and for you to save and use as you wish; more money to create jobs and expand the economy. I mean to keep that growth going and not stifle it with a new burden of taxes. And I mean to simplify the tax system and broaden its base so that we can bring income tax rates further down, not up. That, too, is no secret. I announced it in this year's State of the Union Address to the Congress.

Finally, let me tell you one more thing that should be no secret in case the Democrats talk of so-called secret plans has you worried. I will propose no increase in personal income taxes, and I will veto any tax bill that would raise personal tax rates for working Americans or that would fail to make our tax system simpler or more fair.

Until next week, thanks for listening. God bless you.