THE WHITE HOUSE
Office of the Press Secretary
10:45 A.M. (L)
THE PRESIDENT: Well, first of all, let me say that I think, Prime Minister D'Alema, the morning session is well-named. We are concerned about equality and opportunity in the new economy.
Let us begin with the proposition that the new economy is powered by a revolution in technology, especially in information and telecommunications; and exponentially enhanced by the growing global trade. The new economy does best in a highly entrepreneurial environment where people with new ideas have access to capital and low barriers to establishing a growing business. More than in any previous time of economic expansion, job growth is disproportionately higher in the private, as opposed to the public, sector.
Now, the good news is that there is an extraordinary potential for the growth of jobs, businesses and wealth. We have in the United States been blessed, for example, with a stock market that has more than tripled in the last seven years. But this is not free of challenges, both within and among nations.
Even though, for example, in our country we have the lowest poverty rate in 20 years, and the lowest poverty rate among households headed by single parents -- principally women -- in over 40 years, we know that there are the following problems with the new economy if you just have a laissez-faire policy. Number one, the skill gap among people with high levels of education and low levels will lead to even more dramatic income inequality.
Number two, in a highly volatile environment where lots of jobs are being created and lots of jobs are being lost, it requires a special attention to the transition assistance needed to give people the skills and other support they need to move from one job to another.
Number three, there will be people and places that are completely left behind; I mentioned this in my remarks last night. The United States has the lowest unemployment rate we've had in 30 years, but if you look at some of our inner-city neighborhoods -- the remote mountain places in Appalachia, for example, the Mississippi Delta, the Native America, the American Indian reservations -- you find unemployment rates anywhere from three to 12 times the national average.
So if you wish to promote equality and opportunity, there must be a strategy first to close the skills gap, which means that there's a role for government here. We have to spend more money, not less, than ever before on education; it needs to start sooner; it needs to last for a lifetime; and it needs to be focused much more rigorously on results, so that it's not just a question of spending money, but you're actually getting a higher return for the money that's being spent.
Number two, there needs to be a system of lifetime learning for people in transition. You have people at the age of 50 changing jobs now. They can still do quite well, but they have to have help and support. Number three, there needs to be a system for getting capital to those people and places that are left behind.
Let me just give you an example. One of the big debates we're having in America now is how long we can keep this economic expansion going. It is already the longest peacetime expansion in our history; in February, it will be the longest economic expansion in American history, including World War II.
I believe that this is happening -- I'd like to tell you it's because of my policies -- I believe it's happening because we have underestimated the productivity gains of technology, and underestimated the power of open borders and open trade to restrain inflation -- which permits these economic expansions to go on, if you have good policies.
Now, how can we continue to grow the economy? You can bring investment to the places that are left behind. So I have before the United States Congress, now, a proposal essentially to set up the equivalent in America of our Export-Import Bank and our Overseas Private Investment Corporation to give American investors the same incentives to invest in the poorest areas in America we give them to invest in the poorest areas of Latin America or Africa -- not to take away the foreign incentives, but to mirror them in the very poor areas of our country. I think this is something that all advanced countries should look at.
Finally, let me say there is a big problem with the so-called digital divide. The people who have access to the Internet and technology have enormous advantages, and it has to be closed. We are now hooking up all of our classrooms to the Internet, and we should finish next year; but I think we should shoot for a goal in the developing countries, the developed countries, of having Internet access as complete as telephone access within a fixed number of years. It will do as much as anything else to reduce income inequality.
Last point I want to make: there are not just problems in this economy dealing with equality and opportunity; there are opportunities, too, and let me just mention two.
Number one, technology has permitted us to say for the first time since the Industrial Revolution it is no longer necessary to grow an economy to burn more greenhouse gasses to burn up the atmosphere. It is now possible to grow an economy and actually use less greenhouse gasses and put less strain on the economy. That opens up the opportunity not only to save the environment, but to create literally millions of new jobs around the world.
Number two, the Internet itself offers opportunities for people who don't have access to traditional jobs to make money. There is an American company that perhaps some of you have used, called eBay, and it's basically a place on the Internet where you can buy anything. It's like a great international market on the internet. There are now over 20,000 people, including a lot of people who are on welfare, who are making a living on eBay -- making a living on eBay.
So there are opportunities as well as problems in this economy. We should not be depressed about it. We should just realize that governance requires new policies.
Mr. Prime Minister, you asked us to talk about the domestic issues first, and there are a whole lot of global issues I'd like to deal with but, this is what I would like to say about the domestic issues. We have to deal with more investment in education; more investment in transition aid; a strategy to get capital to people in places left behind; a strategy to close the digital divide; and we have to make the most of the new technologies, especially in the environmental areas, and the new opportunities for isolated people and places to make money because of the Internet, not in spite of it.
Thank you. (Applause.)
END 10:57 A.M. (L)
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