October 4, 1985

The President. Good morning. I'm announcing today what may well be an historic agreement to bring Federal spending under control and, at long last, put the United States on the course to a balanced Federal budget.

Over the years, sincere efforts have been made by men and women of good will in both parties to solve the chronic problem of overspending by the Federal Government. But the problem has not been solved. This week, Congress faces the unhappy task of raising the debt ceiling to over $2 trillion. We cannot escape the simple truth that the budget process has failed nor will we avoid the harsh verdict of history if we cannot summon the political courage to put our national house in order and finally live within our means. The great saving strength of democracy is that we can confront the truth about ourselves. Individuals of vision, courage, and leadership can set things right.

Well, we're going to set things right. We're going to begin amending the budget process today. Many Members of Congress are joining the Senate authors -- Phil Gramm, who's been working with us on this issue since Gramm-Latta in 1981, and Warren Rudman; Democratic chief sponsor, Fritz Hollings; and the House chief sponsors, Connie Mack and Dick Cheney -- in this important deficit control measure. I'm delighted with the leadership support of Senate Majority Leader Bob Dole; Bob Michel, who's in Illinois today; House Republican Whip Trent Lott; as well as the Republican Budget Committee leaders, Pete Domenici and Del Latta.

Let me also thank all of you here today, of both parties, who are joining in support of the Balanced Budget and Emergency Deficit Control Act of 1985. This legislation will impose the discipline we now lack by locking us into a spending reduction plan. It will establish a maximum allowable deficit ceiling beginning with our current 1986 deficit of $180 billion, and then it will reduce that deficit in equal steps to a balanced budget in calendar year 1990. One of the reasons I like this Gramm-Rudman bill is because it attacks budget deficits the right way, not by raising taxes, but by restraining spending. I want it clearly understood that while spending discipline must and will be enforced, we will honor our commitments on Social Security. We will maintain a strong defense, and I expect the Congress to live up to its previous commitments on defense.

Under this legislation, no budget may be submitted with a deficit greater than the maximum allowable as set out in law, and neither House may consider any budget that violates these ceilings. Speaking for myself, I would like to make an additional request -- that Congress work with me to put in place a balanced budget constitutional amendment to begin taking effect in 1991. It will make permanent our plan to have no deficits at the Federal level.

If Congress cooperates and passes this legislation, we can send a clear and compelling message to the world: The United States Government is not only going to pay its bills, but we're also going to take away the credit cards. From now on it'll be cash and carry. And I believe it's critical that the Senate vote today because the debt-limit authority expires on Monday. If we move with bipartisan unity to pass this dramatic but responsible plan to bring Federal spending securely under control and, just as important, unite to bring personal and business tax rates further down, there will be no barriers to America's progress. There'll be no limits to the American dream. And the time is now to move on. So, let's get started.


Reporter. Mr. President, can you tell us any more about Mr. Buckley and whether or not the statement that he has been killed is true?

The President. Well, that changes the subject here a little bit. But, no, we have no word, no way to confirm. He is the one who had been kidnaped in March of '84. We have no confirmation, and until we know something definite, why, we're not going to comment.

Q. Are you worried by your allies' failure to agree to come and see you in New York to discuss matters before the summit?

The President. Well, I'm sorry there seems to be a misunderstanding. This is simply the summit, seven that meet every year. And it was just our thought that since they were going to be here, with the opening of the U.N. and all, that we'd have an extra summit meeting of the kind that we usually have.

Q. Mitterrand has rejected the request for separate negotiations with the Soviets, does that please you or affect you in any way?

The President. That's his decision to make, and I'll have no comment on it. That's -- --

Q. Well, what about the full appeal that Gorbachev is making to Europe? It seems to be a very powerful appeal.

The President. Well, I'm just going to wait until we get to Geneva to see how things come out.

Note: The President spoke at 9:32 a.m. in the State Dining Room at the White House.