we have had. The crucial foundation of this capitalist system was set in place by people like Alexander Hamilton, and they achieved establishing the public credit. They created the first Bank of the United States, the US Mint and a lot more. This foundation has had to be amended and improved by generations over our nearly 250-year history. In the 1990s, I had a minor role with 10 years of very hard work on the part of 535 members of Congress, two different Presidents and countless citizens like Admiral Owens who helped us achieve a balanced budget. And believe it or not, many of you may not remember this, we had a surplus for four years at the end of the 1990s.
We even had discussions with Bob Rubin, who was Secretary of the Treasury, about what are we going to do with the surplus? That’ s a high-class problem. That’ s what we— working together— achieved. Since 1950, there are only four years that we had a balanced budget: 1999, 2000, 2001 and 2002. I was Democratic Leader in the House in 1990 when we started on the path to a balanced budget. The President then was George HW Bush, who I loved. He was a Republican; I’ m a Democrat. He called the leaders down to the White House four times because we had this big deficit that was left over from the Reagan administration, which he was part of. And he said to us, we’ ve got to have a budget summit. We’ ve got to get rid of this deficit. We’ ve got to work toward a balanced budget.
And the Democrats said to him, is everything going to be on the table? And he said, yes, everything’ s on the table. Except taxes. I can’ t put taxes on the table. He said,“ I gave a speech when I got nominated for the presidency in Houston, and I said,‘ Read my lips. No new taxes.’ I can’ t go back on that promise.” We said, we understand. We appreciate that, but we’ re not coming to a summit. We don’ t know what we’ re going to do, but we’ ve got to have all the options in front of us.
The fifth time he called us down to the White House we had dinner in the Oval Office, and he looked at us before we got the food and he said,“ Okay, I get the joke. We’ re putting everything on the table.” He handed a press release to Marlin Fitzwater( White House press secretary), who was standing behind him, and we said, great. We’ re going to do this. We went out back waiting for the cars to pick us up and take us back to the Capitol, and President Bush is standing next to me and he’ s going foot to foot. He’ s nervous as a cat. I said,“ Mr. President, what’ s wrong?” He said,“ The fat’ s in the fire.” That’ s leadership. Leadership is taking on your own side, not the other side.
And so that started nine months of negotiation. I led the effort for the Democrats. Bob Dole led it for the Republicans. Dick Darman was the budget director and he was the liaison to us from President Bush. For nine months, we had all the Senators and House members in rooms for hours on end trying to negotiate the cuts that we were going to make in the budget. And by the time we got into the fall of the year, I could see we were never going to get this done because reporters were coming up to people saying,“ Hey, we hear you’ re going to cut Social Security. We hear you’ re going to cut Medicare. Would you vote for that?” I said,“ We’ re not going to have any votes for anything. We’ ve got to get these people off the campus.” So we went to Andrews Air Force Base for 10 days and nights and locked up 120 members of Congress to negotiate the deal to get it finished.
We finally got it done. We finally passed it by one vote in both houses. After it had passed, I was the last person on the floor. It was right before the holidays. And when I walked off the floor to the speaker’ s lobby, there was only one person there. That was Dick Darman. And we hugged and cried because we knew how hard this was, but what joy we had that we were able— working with everybody— to get it done.
Then Bill Clinton defeated President Bush in the election in 1992, and President Clinton invited the Democratic leaders down to Little Rock in the state capitol to have dinner to talk about what should our plan be in the early part of the administration. And everybody said their piece. I think a lot of people wanted to do healthcare. When I got my chance to talk, I said,“ Mr. President, we just went through an excruciating exercise to get halfway toward a balanced budget. We have to finish the job.” To his great credit, he said, that’ s what we’ re going to do. And that’ s what we did.
So again, we worked for nine months to put together the cuts, and it was the last time the gasoline tax was increased by three cents. That was the only tax in the package. And then once we got it negotiated, I had to go around and get the votes. And I’ d go to members and say, we’ ve got to do this. I know it’ s hard politically. I know you’ re going to anger people in your district. And often they’ d say to me, I should vote for this. This is the right thing to do, but I can’ t do it. And I’ d say, why? And they’ d say, I don’ t think I can get re-elected. And I would say, why did you come here?
If what you just told me would’ ve been said by the young people who assaulted the beach at Normandy, we’ d all be speaking German. They put country over self, and that’ s what you have to do. Sometimes they did; sometimes they didn’ t. But we passed it by one vote. And I’ ll never forget as long as I live, when the vote was starting to end, it’ s on the electronic screen in the house floor. And I had asked the freshmen to hold back because I didn’ t know if we had the votes. Everybody wanted to vote no, but have it pass.
And most of the freshmen did hold out, but when the vote ended, it was tied and only one freshman— a woman from Pennsylvania— had not voted. I went over to Marjorie Mezvinsky and I said, Marjorie, this is it. Forget about me. Forget about your colleagues. Forget about Bill Clinton. Forget about the Democratic Party. This is about the country. If we lose, we can never come back to where we are right now. She said,“ I’ m going to lose my election.” I said,“ I know. We’ ll do everything we can to help you.” And she said,“ Okay, I’ ll do it.” She walked down and she plopped on her green card. The Republicans stood and waved and sang,“ Bye, bye, Marjorie.” She lost the election. She went to teach political science at the University of Pennsylvania. And she’ d always call me every year and say,“ I want to bring my class to DC. Would you talk to them?” I said,“ Of course.” And she would bring her class in and I would introduce her to her class. And I would say,“ Marjorie— your professor— is my hero of democracy. She put country over self, and that’ s the test of any public servant.”
So now, as you heard a little earlier, the national debt is over $ 36 trillion. Our interest cost is greater than the entire budget for national defense. Just think about that. There’ s not even a discussion today about balancing the budget. Nobody brings it up. And right now, there’ s an understandable desire on the part of the new administration to go around the Constitutional framework and just cut the budget without Congress. Just push Congress aside and just do it with
www. MoAF. org | Spring 2025 | FINANCIAL HISTORY 7