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Originally Processed With FOIA(s): FOIA Number: 2025-0647-S 2025-0647-S FOIA MARKER This is not a textual record. This is used as an administrative marker by the George Bush Presidential Library Staff. Record Group/Collection: George H.W. Bush Presidential Records Collection/Office of Origin: Chief of Staff, White House Office of Series: Rogers, Ed, Files Subseries: Subject Files OA/ID Number: 04014 Folder ID Number: 04014-028 Folder Title: State of the Union 1991 Stack: Row: Section: Shelf: Position: G 15 23 1 THE PRESIDENT'S STATE OF THE UNION SPEECH JANUARY 29, 1991 -- TALKING POINTS International: Halfway around the world we are engaged in the hard work of freedom. A new world order of peace, security, and the rule of law, is being built by the brave men and women now serving in the Persian Gulf. America stands with the United Nations, and armed forces from 28 countries, to reverse Saddam Hussein's aggression in the Gulf. We are on course and we will prevail. Highlights of the President's agenda for investment in the future: -- legislation to achieve excellence in education; -- support for research and development in technology; -- a comprehensive national energy strategy; -- a new national highway system; -- comprehensive new banking reform measures; -- a national drug strategy for combatting drug abuse and crime; and -- election law reform. Themes: America's future lies in unlocking every citizen's potential. The legislative accomplishments of the last year -- enhancing opportunities for Americans with disabilities, giving child care support directly to parents, and making affordable housing available to more Americans -- strengthen the power and freedom of choice for individuals and families. The President seeks to affirm America as a nation of principle, a nation without unfair barriers, preferences, or bias. A nation that protects and expands the potential of individuals while it creates new jobs and economic growth as a competitor in the global economy. A strong economy and expanded economic freedom are chief among the goals of the President's economic growth package, which includes tax-free family savings accounts, IRAs for first-time home-buyers, and incentives for long-term investment. President Bush called on every American to ready the nation for the future by working to enhance freedom at home, to foster freedom abroad, and to make America a community of conscience. THE WHITE HOUSE Office of the Press Secretary EMBARGOED FOR RELEASE AND WIRE TRANSMISSION UNTIL 9:00 PM (EST) TUESDAY, JANUARY 29, 1991 THE PRESIDENT'S STATE OF THE UNION ADDRESS FACT SHEET The President's 1991 State of the Union address discussed: A New World Order Preparing for the Next American Century The War in the Gulf The President explained that he came to speak to the Congress and all Americans "certain that we stand at a defining hour." I. A NEW WORLD ORDER A. Peace and the Rule of Law The President declared that what is at stake in the Persian Gulf is more than just the independence of Kuwait. It is a new world order where diverse nations are brought together to give permanence to the universal aspirations of mankind: Peace and security; Freedom; and The rule of law. The world has "resisted the trap of appeasement, cynicism, and isolation" and is united in demanding Iraq's immediate and unconditional withdrawal from Kuwait. We are working to achieve victory over tyranny and lawless aggression. America has "a unique responsibility to do the hard work of freedom." -2- B. Constructive Change The President noted that "the end of the Cold War has been a victory for all humanity. Germany is united. Europe has become whole and free -- and America's leadership was instrumental in making it possible." C. U.S.-Soviet Relations The President stated that "our relationship with the Soviet Union is important, not only to us, but to the world." It has contributed to positive, historic change. The President also noted that "like many other nations, we have been deeply concerned by the violence in the Baltics." The President stated that in discussions with the Soviet leadership "we have been given representations, which, if fulfilled, would result in the withdrawal of some Soviet forces, a reopening of dialogue with the Republics, and a move away from violence." We will watch carefully as the situation develops; we will also maintain our contacts with Soviet leaders to encourage democratization and reform. II. PREPARING FOR THE NEXT AMERICAN CENTURY The President asserted that the spirit that is winning a victory for world peace and justice in the Persian Gulf is "the same spirit that gives us the power and the potential to meet our toughest challenges at home." The President called for "new initiative in government, in our communities, and from every American, to prepare for the next American century." The President encouraged all Americans to join the "community of conscience", asserting that "we have within our reach the promise of a renewed America." He said "we can find meaning and reward by serving some purpose higher than ourselves." The President called for "strengthening the power and freedom of choice of individuals and families." He declared that "the strength of a democracy is not in bureaucracy," but "in the people and their communities." The President called for the unleashing of "the potential of our most precious resource -- our citizens." This should be done by returning to "families, communities, counties, cities, states, and institutions of every kind, the power to chart their own destiny." -3- A. Encouraging Economic Growth The President explained that he understands the genuine economic distress experienced by many Americans. He offered three reasons to be optimistic about the economy: - Inflation is low; - Inventories are low; and - Exports are strong. The President expressed confidence that "we will get this recession behind us, and return to growth -- soon." Controlling Federal Spending and Enforcing the Budget Agreement The President declared that strong economic growth requires control of Federal spending. He will transmit a budget that holds the growth in spending to less than the rate of inflation. The budget agreement put the Federal government on a pay- as-you-go plan and cut the growth of debt by nearly $500 billion. Encouraging Savings and Investment The President explained that the budget agreement helped free private funds for savings and job-creating investment. In addition, the President announced that his budget again includes: Tax-free family savings accounts; Penalty-free withdrawals from IRAs for first- time home buyers; and A strengthened long-term capital gains incentive. He also asked congressional leaders, the Administration, and the Federal Reserve to cooperate in a study, led by Federal Reserve Chairman Alan Greenspan, to reach technical agreement on the budgetary and other economic effects of a strengthened capital gains incentive. -4- B. Investing in the Future The President said that we must match incentives for economic growth today with long-term investments for the next American century. Budget Priorities The President indicated that his FY 1992 budget priorities will include promoting investments in children, education, infrastructure, space, and high technology. Strengthening Education The President will propose a new Educational Excellence Act which contains strategic initiatives to improve the learning achievement of all Americans and to restructure the nation's educational system. Initiatives in the Educational Excellence Act will: Stimulate fundamental reform and restructure our education system through promoting educational choice and alternative certification for teachers and principals. Promote local control and innovation in education by providing increased flexibility in funding at the Federal and state levels in exchange for enhanced accountability. Assist educators in their mission to improve student performance by: rewarding schools that demonstrate improved achievement among students; rewarding excellent teachers; and providing innovation in training school administrators. Provide incentives to school districts to design and implement innovative approaches to mathematics and science education; enhance the endowments of Historically Black Colleges and Universities; and contribute to improving literacy. -5- Strengthening Transportation Infrastructure The President believes a strong highway system is a critical investment for our economic success. He indicated that he would shortly outline the details of a new National Highway System managed in partnership with the States. Enhancing Research and Development To strengthen our research and development capability and economic competitiveness the President will propose: A record Federal budget commitment to science and expanding the frontiers of knowledge, including basic research and making government research more available to the private sector for speedier commercialization; Increased support for generic or enabling technologies at the pre-competitive stage of R&D in such areas as high-performance computing, new energy technologies, and advanced manufacturing and materials; and Making permanent the R&E tax credit. Reducing Energy Vulnerability The President will soon present a comprehensive National Energy Strategy that calls for energy conservation and efficiency, increased domestic energy development, and greater use of alternative fuels. The elements of the strategy are designed to: Foster economic growth through the availability of ample supplies of reasonably priced energy; Enhance energy security by reducing vulnerability to oil disruptions; and Increase research and development of a wide range of promising energy technologies. Providing Financial Security The President said that we will continue to make sure banks are safe, sound, and able to provide adequate credit -6- for job-creating loans for factories, businesses, and homebuyers. He stated that "sound banks should be making more sound loans, now -- and interest rates should be lower, now." The Treasury will shortly unveil a plan to bring America's financial system into the 21st century. The elements of the plan are designed to: Continue to protect the deposits of America's workers and savers; Assure the safety, soundness, and competitiveness of our financial institutions; Create a regulatory system that is strong, simple, and streamlined; and Move toward a deposit insurance fund that is well capitalized with industry funds. Expanding World Trade The President called for an expansion of world trade, to create new opportunities for U.S. exports, which have grown by 23 percent over the past two years to nearly $400 billion. His priorities include: - Strengthening and expanding the world trading system through the swift and successful completion of the Uruguay Round of multilateral trade negotiations. These negotiations aim to open markets worldwide, lower government subsidies and trade barriers that distort agricultural markets, and establish rules of fair play in areas vital to U.S. competitiveness -- such as services, agriculture, and high technology. The lower trade barriers that would result from a successful Uruguay Round could increase world output by approximately $5 trillion over the next ten years, and U.S. output by $1 trillion. - A U.S.- Mexico Free Trade Agreement (FTA), first endorsed by President Bush and Mexico's President Carlos Salinas de Gortari in June 1990. -7- A comprehensive FTA would aim to eliminate barriers to trade in goods and services and investment between the United States and Mexico, as well as provide for the protection of intellectual property rights. It would free trade totalling $59 billion between the two countries. The FTA might also include Canada, thus creating the world's largest market, with 360 million consumers and $6 trillion in total output. - Implementing the Enterprise for the Americas Initiative, launched by President Bush last June. The President's initiative aims to spur economic growth and create jobs among the nations of the Western Hemisphere by removing barriers to trade and investment, and by reducing debt burdens. The initiative envisions the eventual development of a hemispheric zone of free trade. The United States has begun the process of opening markets to trade and investment with over a dozen countries in the region. The President will propose legislation to enable full implementation of the investment and debt reduction portions of the initiative. - Export Promotion. The Administration will be taking quality and export programs to cities around the country, to make certain that more U.S. firms know the export potential of top quality goods and services. C. Giving Power and Opportunity to the Individual The President announced an action plan to "put more power and opportunity in the hands of the individual." Creating Job Opportunities The President called for new incentives to create jobs in our inner cities by encouraging investment through enterprise zones. -8- Increasing Home Ownership The President also called for increasing tenant ownership and control of public housing to help build the bonds of community in neighborhoods that need help. Fighting Discrimination The President stated that "civil rights are also crucial to protecting equal opportunity." He called on all Americans to speak out against racism, bigotry, and hate. The President indicated that "we will continue our vigorous enforcement of existing statutes," and promised to press the Congress again "to strengthen the laws against employment discrimination without resorting to the use of unfair preferences." Protecting People From Crime and Combatting Drug Abuse The President described freedom from crime as a basic civil right and said that we must eradicate the fear that stalks our cities. - He announced that the Attorney General will soon convene a Crime Summit of our nation's law enforcement officials. - He called for prompt action on tough crime control legislation. The President will propose legislation that will include: A meaningful Federal death penalty for the most heinous crimes with procedures to ensure its fair and colorblind application; Habeas corpus reform to reduce unnecessarily repetitive appeals that clog the courts and delay justice; Exclusionary rule reform to ensure that evidence gathered by law enforcement officials in a good faith belief that they are acting lawfully can be used to help courts establish the truth; Provisions to strengthen Federal laws concerning the safety of women by modifying rules on the -9- admissibility of evidence in cases of sex crimes, enhancing penalties for the distribution of illegal drugs to pregnant women, increasing penalties for recidivist sex offenders, and offering greater protection for victims below the age of sixteen; and New authority to enhance international cooperation among law enforcement officials to combat international criminal activity, including international terrorism. - The President noted that recent data shows we are making progress in reducing drug abuse, but that much remains to be done. The Administration will soon release the third edition of the National Drug Control Strategy. This comprehensive strategy includes increased resources for drug prevention and education, treatment, law enforcement, and international initiatives. Enhancing Good Health Through Prevention The President stated that good health is every American's right and responsibility. He announced that he will propose an aggressive program of new prevention initiatives to promote a healthier America and to help control costs. The initiatives are designed to make Americans of all ages healthier. Infant health will be improved through an initiative that targets cities with exceptionally high infant mortality rates; Children will benefit from large increases in immunization resources; Adults will benefit from new efforts to promote physical activity and reduce injury, reduce tobacco use, and implementation of a new program to detect breast and cervical cancer; and Elderly women will benefit from mammography services newly available to Medicare beneficiaries. -10- Giving People More Choice in Government The President urged "reviving the ideal of the citizen politician who comes not to stay, but to serve." He endorsed term limitations in order to reduce the influence of special interests. He also endorsed election reform -- total elimination of Political Action Committees -- as necessary to put more power in the hands of individuals. D. Moving Government Closer to the People The President said that "where power cannot be put directly in the hands of the individual, it should be moved closer to the people -- away from Washington." The President called for a more dynamic program life cycle. Some programs should increase; Some should decrease; Some should be terminated; and Some should be consolidated and turned over to the States. The President's Budget includes a list of potential programs for turnover totalling more than $20 billion. Working with the Governors and the Congress, the President proposed selecting at least $15 billion in such programs and turning them over to the States in a single consolidated grant, fully funded, for flexible management by the States. This initiative will: Allow the Federal Government to reduce overhead; Allow States to manage more flexibly and efficiently; Move power and decision-making closer to the people; and Encourage the innovative power of "States as Laboratories." -11- III. THE WAR IN THE GULF A. The Heroism of Our Servicemen and Servicewomen The President said that, in this defining hour for America and the world, "there is no one more devoted, more committed to the hard work of freedom than every soldier and sailor, every Marine, airman and Coastguardsman -- every man and woman now serving in the Persian Gulf." He stated that our commitment to them must match their commitment to their country. B. We Are on Course The President said that while we worked hard to avoid war, Saddam Hussein repeatedly rejected the path of diplomacy and peace. But we will prevail; we are on course. "Iraq's capacity to sustain war is being destroyed Time will not be Saddam's salvation. C. Objectives in the Gulf The President reaffirmed our objectives: Drive Iraq from Kuwait. Iraq must comply with all relevant United Nations resolutions. Restore Kuwait's legitimate government. Kuwait will once again be free. Ensure stability and security in the Gulf region. It is our hope that Iraq will live as a peaceful and cooperative member of the family of nations. The President stated that most Americans know instinctively why we are in the Gulf -- "we had to stop Saddam now, not later." The President noted the undeniable value of thoughtful dissent. The right to speak out "is one of the reasons we've been united in purpose and principle for 200 years." D. Strategic Benefits of High Technology The President observed that our progress in the Gulf is the result of using American technology and economic -12- strength to minimize the risk to human life. Our men and women have the best and deserve the best. The President directed that the Strategic Defense Initiative (SDI) program be refocused on providing protection from limited ballistic missile strikes -- from whatever their source. E. The Unity of the International Community The President observed that for the first time in the post-war era, the international community is united. It has an opportunity to fulfill the long-held promise of a new world order -- where brutality goes unrewarded, and aggression meets collective resistance. The President praised the courage and success of the pilots of the coalition countries and the leadership provided by the United Nations, an organization that is now confirming its founders' vision. The President also commended our friends and allies who have provided the bulk of the financial costs of Desert Shield, and expressed confidence that they will similarly financially support Desert Storm. F. U.S. Determination is Great The President stated that Saddam will not benefit from targeting innocent civilians, from environmental terrorism, or by abusing POWs. We will succeed, and in the process send a powerful message to any dictator or despot who would follow Saddam's lead. G. The Special Role of U.S. Leadership The President stated that "the United States bears a major share of leadership" in the Gulf War effort. He noted that the burden of leadership is a "strength that has made America the beacon of freedom in a searching world." THE WHITE HOUSE Office of the Press Secretary For Immediate Release January 29, 1991 ADDRESS BY THE PRESIDENT ON THE STATE OF THE UNION The U.S. Capitol Washington, D.C. 9:09 P.M. EST THE PRESIDENT: Mr. President, and Mr. Speaker, and members of the United States Congress. I come to this House of the people to speak to you and all Americans, certain that we stand at a defining hour. Halfway around the world, we are engaged in a great struggle in the skies and on the seas and sands. We know why we're there. We are Americans -- part of something larger than ourselves. For two centuries, we've done the hard work of freedom. And tonight, we lead the world in facing down a threat to decency and humanity. What is at stake is more than one small country; it is a big idea: a new world order, where diverse nations are drawn together in common cause to achieve the universal aspirations of mankind -- peace and security, freedom, and the rule of law. Such is a world worthy of our struggle and worthy of our children's future. (Applause.) The community of nations has resolutely gathered to condemn and repel lawless aggression. Saddam Hussein's unprovoked invasion -- his ruthless, systematic rape of a peaceful neighbor -- violated everything the community of nations holds dear. The world has said this aggression would not stand -- and it will not stand. (Applause.) Together, we have resisted the trap of appeasement, cynicism, and isolation that gives temptation to tyrants. The world has answered Saddam's invasion with 12 United Nations resolutions, starting with a demand for Iraq's immediate and unconditional withdrawal and backed up by forces from 28 countries of six continents. With few exceptions, the world now stands as one. The end of the Cold War has been a victory for all humanity. A year and a half ago, in Germany, I said that our goal was a Europe whole and free. Tonight, Germany is united. Europe has become whole and free -- and America's leadership was instrumental in making it possible. (Applause.) Our relationship to the Soviet Union is important, not only to us, but to the world. That relationship has helped to shape these and other historic changes. But like many other nations, we have been deeply concerned by the violence in the Baltics, and we have communicated that concern to the Soviet leadership. The principle that has guided us is simple: Our objective is to help the Baltic peoples achieve their aspirations, not to punish the Soviet Union. (Applause.) In our recent discussions with the Soviet leadership, we have been given representations which, if fulfilled, would result in the withdrawal of some Soviet forces, a reopening of dialogue with the Republics, and a move away from violence. We will watch carefully as the situation develops. And we will maintain our contact with the Soviet leadership to encourage MORE - 2 - continued commitment to democratization and reform. (Applause.) If it is possible, I want to continue to build a lasting basis for U.S.-Soviet cooperation, for a more peaceful future for all mankind. The triumph of democratic ideas in Eastern Europe and Latin America, and the continuing struggle for freedom elsewhere all around the world all confirm the wisdom of our nation's founders. Tonight, we work to achieve another victory . a victory over tyranny and savage aggression. We in this Union enter the last decade of the 20th century thankful for our blessings, steadfast in our purpose, aware of our difficulties, and responsive to our duties at home and around the world. For two centuries, America has served the world as an inspiring example of freedom and democracy. For generations, America has led the struggle to preserve and extend the blessings of liberty. And today, in a rapidly changing world, American leadership is indispensable. Americans know that leadership brings burdens and sacrifices. But we also know why the hopes of humanity turn to us. We are Americans: we have a unique responsibility to do the hard work of freedom. And when we do, freedom works. (Applause.) The conviction and courage we see in the Persian Gulf today is simply the American character in action. The indomitable spirit that is contributing to this victory for world peace and justice is the same spirit that gives us the power and the potential to meet our toughest challenges at home. We are resolute and resourceful. If we can selflessly confront evil for the sake of good in a land so far away, then surely we can make this land all that it should be. If anyone tells you that America's best days are behind her, they're looking the wrong way. (Applause.) Tonight, I come before this House and the American people with an appeal for renewal. This is not merely a call for new government initiatives; it is a call for new initiative in government, in our communities, and from every American to prepare for the next American century. America has always led by example. So who among us will set this example? Which of our citizens will lead us in this next American century? Everyone who steps forward today -- to get one addict off drugs, to convince one troubled teenager not to give up on life, to comfort one AIDS patient, to help one hungry child. We have within our reach the promise of a renewed America. We can find meaning and reward by serving some purpose higher than ourselves -- a shining purpose, the illumination of a thousand points of light. And it is expressed by all who know the irresistible force of a child's hand, of a friend who stands by you and stays there -- a volunteer's generous gesture, an idea that is simply right. The problems before us may be different, but the key to solving them remains the same. It is the individual -- the individual who steps forward. And the state of our Union is the union of each of us, one to the other -- the sum of our friendships, marriages, families, and communities. We all have something to give. So if you know how to read, find someone who can't. If you've got a hammer, find a nail. If you're not hungry, not lonely, not in trouble, seek out someone who is. Join the community of conscience. Do the hard work of freedom. And that will define the state of our Union. (Applause.) Since the birth of our nation, "We the people" has been the source of our strength. What government can do alone is limited -- but the potential of the American people knows no limits. MORE - 3 - We are a nation of rock-solid realism and clear-eyed idealism. We are Americans. We are the nation that believes in the future. We are the nation that can shape the future. And we've begun to do just that by strengthening the power and choice of individuals and families. Together, these last two years, we've put dollars for child care directly in the hands of parents instead of bureaucracies. (Applause.) Unshackled the potential of Americans with disabilities. (Applause.) Applied the creativity of the marketplace in the service of the environment, for clean air; and made home ownership possible for more Americans. (Applause.) The strength of a democracy is not in bureaucracy. It is in the people and their communities. In everything we do, let us unleash the potential of our most precious resource our citizens, our citizens themselves. We must return to families, communities, counties, cities, states, and institutions of every kind the power to chart their own destiny, and the freedom and opportunity provided by strong economic growth. And that's what America is all about. (Applause.) I know tonight in some regions of our country, people are in genuine economic distress. And I hear them. Earlier this month, Kathy Blackwell, of Massachusetts, wrote me about what can happen when the economy slows down, saying, "My heart is aching, and I think that you should know your people out here are hurting badly." I understand. And I'm not unrealistic about the future. But there are reasons to be optimistic about our economy. First, we don't have to fight double-digit inflation. Second, most industries won't have to make big cuts in production because they don't have big inventories piled up. And third, our exports are running solid and strong. In fact, American businesses are exporting at a record rate. So let's put these times in perspective. Together, since 1981, we've created almost 20 million jobs, cut inflation in half, and cut interest rates in half. And, yes, the largest peacetime economic expansion in history has been temporarily interrupted. But our economy is still over twice as large as our closest competitor. We will get this recession behind us and return to growth soon. (Applause.) We will get on our way to a new record of expansion and achieve the competitive strength that will carry us into the next American century. We should focus our efforts today on encouraging economic growth, investing in the future, and giving power and opportunity to the individual. (Applause.) We must begin with control of federal spending. (Applause.) That's why I'm submitting a budget that holds the growth in spending to less than the rate of inflation. And that's why, amid all the sound and fury of last year's budget debate, we put into law new, enforceable spending caps so that future spending debates will mean a battle of ideas, not a bidding war. (Applause.) Though controversial, the budget agreement finally put the federal government on a pay-as-you-go plan and cut the growth of debt by nearly $500 billion. And that frees funds for saving and job-creating investment. Now, let's do more. My budget again includes tax-free family savings accounts; penalty-free withdrawals from IRAs for first-time home buyers - (applause) -- and to increase jobs and MORE - 4 - growth, a reduced tax for long-term capital gains. (Applause.) I know there are differences among us (laughter) -- about the impact and the effects of a capital gains incentive. So tonight, I'm asking the congressional leaders and the Federal Reserve to cooperate with us in a study, led by Chairman Alan Greenspan, to sort out our technical differences so that we can avoid a return to unproductive partisan bickering. (Applause.) But just as our efforts will bring economic growth now and in the future, they must also be matched by long-term investments for the next American century. That requires a forward-looking plan of action -- and that's exactly what we will be sending to the Congress. We've prepared a detailed series of proposals that include: A budget that promotes investment in America's future -- in children, education, infrastructure, space, and high technology; legislation to achieve excellence in education -- building on the partnership forged with the 50 governors at the Education Summit, enabling parents to choose their children's schools and helping to make America number one in math and science; -- (applause) -- a blueprint for a new national highway system -- a critical investment in our transportation infrastructure; -- (applause) -- a research and development agenda that includes record levels of federal investment, and a permanent tax credit to strengthen private R&D and to create jobs; -- (applause) -- a comprehensive national energy strategy that calls for energy conservation and efficiency, increased development, and greater use of alternative fuels; -- (applause) -- a banking reform plan to bring America's financial system into the 21st century so that our banks remain safe and secure and can continue to make job-creating loans for our factories, our businesses and home-buyers. You know, I do think there has been too much pessimism. Sound banks should be making sound loans now and interest rates should be lower, now. (Applause.) In addition to these proposals, we must recognize that our economic strength depends on being competitive in world markets. We must continue to expand American exports. A successful Uruguay Round of world trade negotiations will create more real jobs and more real growth for all nations. You and I know that if the playing field is level, America's workers and farmers can out-work, out-produce anyone, anytime, anywhere. (Applause.) And with a Mexican Free Trade Agreement and our Enterprise for the Americas Initiative, we can help our partners strengthen their economies and move toward a free trade zone throughout this entire hemisphere. (Applause.) The budget also includes a plan of action right here at home to put more power and opportunity in the hands of the individual. And that means new incentives to create jobs in our inner cities, by encouraging investment through enterprise zones. It also means tenant control and ownership of public housing. Freedom and the power to choose should not be the privilege of wealth. They are the birthright of every American. (Applause.) Civil rights are also crucial to protecting equal opportunity. (Applause.) Every one of us has a responsibility to speak out against racism, bigotry, and hate. (Applause.) We will continue our vigorous enforcement of existing statutes, and I will MORE - 5 - once again press the Congress to strengthen the laws against employment discrimination without resorting to the use of unfair preferences. (Applause.) We're determined to protect another fundamental civil right freedom from crime and the fear that stalks our cities. The Attorney General will soon convene a crime summit of our nation's law enforcement officials. And to help us support them, we need tough crime control legislation, and we need it now. (Applause.) And as we fight crime, we will fully implement our national strategy for combatting drug abuse. Recent data show that we are making progress, but much remains to be done. We will not rest until the day of the dealer is over, forever. (Applause.) Good health care is every American's right and every American's responsibility. And so we are proposing an aggressive program of new prevention initiatives -- for infants, for children, for adults, and for the elderly to promote a healthier America and to help keep costs from spiralling. (Applause.) It's time to give people more choice in government, by reviving the ideal of the citizen politician who comes not to stay, but to serve. And one of the reasons that there is so much support across this country for term limitations is that the American people are increasingly concerned about big-money influence in politics. So we must look beyond the next election, to the next generation. And the time has come to put the national interest above the special interest -- and totally eliminate political action committees. (Applause.) And that would truly put more competition in elections, and more power in the hands of individuals. And where power cannot be put directly in the hands of the individual, it should be moved closer to the people. away from Washington. The federal government too often treats government programs as if they are of Washington, by Washington, and for Washington. Once established, federal programs seem to become immortal. It's time for a more dynamic program life cycle: Some programs should increase. Some should decrease. Some should be terminated. And some should be consolidated and turned over to the states. (Applause.) My budget includes a list of programs for potential turnover totalling more than $20 billion. Working with Congress and the governors, I propose we select at least $15 billion in such programs and turn them over to the states in a single consolidated grant -- fully funded for flexible management by the states. (Applause.) The value -- the value of this turnover approach is straightforward. It allows the federal government to reduce overhead. It allows states to manage more flexibly and more efficiently. It moves power and decision-making closer to the people. And it reinforces a theme of this administration: appreciation and encouragement of the innovative powers of "States as Laboratories." This nation was founded by leaders who understood that power belongs in the hands of people. And they planned for the future. And so must we -- here and all around the world. As Americans, we know that there are times when we must step forward and accept our responsibility to lead the world away from the dark chaos of dictators, toward the brighter promise of a better day. Almost 50 years ago we began a long struggle against aggressive totalitarianism. Now we face another defining hour for MORE - 6 - America and the world. There is no one more devoted, more committed to the hard work of freedom, than every soldier and sailor, every Marine, airman, and Coastguardsman every man and woman now serving in the Persian Gulf. (Applause.) Oh, how they deserve -- (applause) -- and what a fitting tribute to them. You see what a wonderful, fitting tribute to them. Each of them has volunteered volunteered to provide for this nation's defense -- and now they bravely struggle, to earn for America, for the world, and for future generations, a just and lasting peace. Our commitment to them must be equal to their commitment to their country. They are truly America's finest. (Applause.) The war in the Gulf is not a war we wanted. We worked hard to avoid war. For more than five months we, along with the Arab League, the European Community, the United Nations, tried every diplomatic avenue. U.N. Secretary General Perez de Cuellar; Presidents Gorbachev, Mitterrand, Ozal, Mubarak, and Bendjedid; Kings Fahd and Hassan; Prime Ministers Major and Andreotti just to name a few -- all worked for a solution. But time and again, Saddam Hussein flatly rejected the path of diplomacy and peace. The world well knows how this conflict began and when: It began on August 2nd, when Saddam invaded and sacked a small, defenseless neighbor. And I am certain of how it will end. So that peace can prevail, we will prevail. (Applause.) Thank you. Tonight, I am pleased to report that we are on course. Iraq's capacity to sustain war is being destroyed. Our investment, our training, our planning all are paying off. Time will not be Saddam's salvation. Our purpose in the Persian Gulf remains constant: to drive Iraq out of Kuwait, to restore Kuwait's legitimate government, and to ensure the stability and security of this critical region. Let me make clear what I mean by the region's stability and security. We do not seek the destruction of Iraq, its culture, or its people. Rather, we seek an Iraq that uses its great resources, not to destroy, not to serve the ambitions of a tyrant, but to build a better life for itself and its neighbors. We seek a Persian Gulf where conflict is no longer the rule, where the strong are neither tempted nor able to intimidate the weak. Most Americans know instinctively why we are in the Gulf. They know we had to stop Saddam now, not later. They know that this brutal dictator will do anything; will use any weapon; will commit any outrage, no matter how many innocents suffer. They know we must make sure that control of the world's oil resources does not fall into his hands, only to finance further aggression. They know that we need to build a new, enduring peace -- based not on arms races and confrontation, but on shared principles and the rule of law. And we all realize that our responsibility to be the catalyst for peace in the region does not end with the successful conclusion of this war. Democracy brings the undeniable value of thoughtful dissent and we've heard some dissenting voices here at home -- some, a handful, reckless -- most responsible. But the fact that all voices have the right to speak out is one of the reasons we've been united in purpose and principle for 200 years. (Applause.) Our progress in this great struggle is the result of years of vigilance and a steadfast commitment to a strong defense. Now, with remarkable technological advances like the Patriot missile, MORE - 7 - we can defend against ballistic missile attacks aimed at innocent civilians. Looking forward, I have directed that the SDI program be refocused on providing protection from limited ballistic missile strikes whatever their source. (Applause.) Let us pursue an SDI program that can deal with any future threat to the United STates, to our forces overseas, and to our friends and allies. The quality of American technology, thanks to the American worker, has enabled us to successfully deal with difficult military conditions and help minimize precious loss of life. We have given our men and women the very best. And they deserve it. (Applause.) We all have a special place in our hearts for the families of our men and women serving in the Gulf. They are represented here tonight by Mrs. Norman Schwarzkopf. (Applause.) We are all very grateful to General Schwarzkopf and to all those serving with him. And I might also recognize one who came with Mrs. Schwarzkopf - Alma Powell, the wife of the distinguished Chairman of the Joint Chiefs. (Applause.) And to the families, let me say our forces in the Gulf will not stay there one day longer than is necessary to complete their mission. (Applause.) The courage and success of the RAF pilots, of the Kuwaiti, Saudi, French, the Canadians, the Italians, the pilots of Qatar and Bahrain - all are proof that for the first time since World War II, the international community is united. The leadership of the United Nations, once only a hoped-for ideal, is now confirming its founders' vision. (Applause.) I am heartened that we are not being asked to bear alone the financial burdens of this struggle. Last year, our friends and allies provided the bulk of the economic costs of Desert Shield. And now, having received commitments of over $40 billion for the first three months of 1991, I am confident they will do no less as we move through Desert Storm. (Applause.) But the world has to wonder what the dictator of Iraq is thinking. If he thinks that by targeting innocent civilians in Israel and Saudi Arabia, that he will gain advantage, he is dead wrong. (Applause.) If he thinks that he will advance his cause through tragic and despicable environmental terrorism, he is dead wrong. (Applause.) And if he thinks that by abusing the coalition prisoners of war he will benefit, he is dead wrong. (Applause.) We will succeed in the Gulf. And when we do, the world community will have sent an enduring warning to any dictator or despot, present or future, who contemplates oulaw aggression. The world can, therefore, seize this opportunity to fulfill the long-held promise of a new world order, where brutality will go unrewarded and aggression will meet collective resistance. Yes, the United States bears a major share of leadership in this effort. Among the nations of the world, only the United States of America has both the moral standing and the means to back it up. We're the only nation on this Earth that could assemble the forces of peace. This is the burden of leadership and the strength that has made America the beacon of freedom in a searching world. This nation has never found glory in war. Our people have never wanted to abandon the blessings of home and work for distant lands and deadly conflict. If we fight in anger, it is only because we have to fight at all. And all of us yearn for a world where we will never have to fight again. Each of us will measure within ourselves the value of this great struggle. Any cost in lives -- any cost is beyond our power to measure. But the cost of closing our eyes to aggression is beyond mankind's power to imagine. MORE - 8 - This we do know: Our cause is just. Our cause is moral. Our cause is right. (Applause.) Let future generations understand the burden and the blessings of freedom. Let them say we stood where duty required us to stand. Let them know that, together, we affirmed America and the world as a community of conscience. The winds of change are with us now. The forces of freedom are together, united. We move toward the next century more confident than ever that we have the will at home and abroad to do what must be done, the hard work of freedom. May God bless the United States of America. Thank you very, very much. (Applause.) END 9:57 P.M. EST THE WHITE HOUSE WASHINGTON January 30, 1991 MEMORANDUM FOR WHITE HOUSE SENIOR STAFF FROM: Frederick D. McClure 7m SUBJECT: 1991 State of the Union Address I thought you might enjoy this commemorative copy of the President's 1991 State of the Union Address. The State of the Union Address to the 102nd Congress First Session President George Bush January 29, 1991 Washington, D.C. PRESIDENTIAL ADDRESS: THE STATE OF THE UNION, 1991 THE CAPITOL TUESDAY, JANUARY 29, 1991 Mr. President, Mr. Speaker, members of the United States Congress. I come to this House of the people, to speak to you and all Americans, certain that we stand at a defining hour. Halfway around the world, we are engaged in a great struggle in the skies and on the seas and sands. We know why we're there. We are Americans: part of some- thing larger than ourselves. For two centuries, we've done the hard work of freedom. And tonight, we lead the world in facing down a threat to decency and humanity. What is at stake is more than one small country, it is a big idea: a new world order-where diverse nations are drawn together in common cause, to achieve the universal aspirations of mankind: peace and security, freedom, and the rule of law. Such is a world worthy of our struggle, and worthy of our children's future. The community of nations has resolutely gathered to condemn and repel lawless aggression. Saddam Hussein's unprovoked invasion-his ruthless, systematic rape of a peaceful neighbor-violated everything the community of nations holds dear. The world has said this aggression would not stand-and it will not stand. Together, we have resisted the trap of appeasement, cynicism, and isolation that gives temptation to tyrants. The world has answered Saddam's invasion with 12 United Nations resolu- tions, starting with a demand for Iraq's immediate and unconditional withdrawal- and backed up by forces from 28 countries of six continents. With few exceptions, the world now stands as one. The end of the Cold War has been a victory for all humanity. A year and a half ago, in Germany, I said our goal was a Europe whole and free. Tonight, Germany is united. Europe has become whole and free-and America's leadership was instru- mental in making it possible. Our relationship with the Soviet Union is important, not only to us, but to the world. That relationship has helped to shape these and other historic changes. But, like many other nations, we have been deeply concerned by the violence in the Baltics, and we have communicated that concern to the Soviet leadership. The principle that has guided us is simple: our objective is to help the Baltic peoples achieve their aspirations, not to punish the Soviet Union. In our recent discus- sions with the Soviet leadership, we have been given representations, which, if fulfilled, would result in the withdrawal of some Soviet forces, a re-opening of dialogue with the Republics, and a move away from violence. We will watch carefully as the situation develops. And we will maintain our contact with the Soviet leadership to encourage continued commitment to democratization and reform. 1 If it is possible, I want to continue to build a lasting basis for U.S.-Soviet coopera- tion, for a more peaceful future for all mankind. The triumph of democratic ideas in Eastern Europe and Latin America-and the continuing struggle for freedom elsewhere around the world-all confirm the wisdom of our nation's founders. Tonight, we work to achieve another victory-a victory over tyranny, and savage aggression. We in this Union enter the last decade of the 20th Century thankful for our blessings, steadfast in our purpose, aware of our difficulties, and responsive to our duties at home and around the world. For two centuries, America has served the world as an inspiring example of freedom and democracy. For generations, America has led the struggle to preserve and extend the blessings of liberty. And today, in a rapidly changing world, American leadership is indispensable. Americans know that leadership brings burdens, and re- quires sacrifice. But we also know why the hopes of humanity turn to us. We are Americans: we have a unique responsibility to do the hard work of freedom. And when we do-freedom works. The conviction and courage we see in the Persian Gulf today is simply the American character in action. The indomitable spirit that is contributing to this victory for world peace and justice is the same spirit that gives us the power and the potential to meet our toughest challenges at home. We are resolute and resourceful. If we can selflessly confront evil for the sake of good in a land so far away, then surely we can make this land all that it should be. If anyone tells you America's best days are behind her, they're looking the wrong way. Tonight, I come before this House, and the American people, with an appeal for renewal. This is not merely a call for new government initiatives, it is a call for new initiative in government, in our communities, and from every American— to prepare for the next American century. America has always led by example. So who among us will set this example? Which of our citizens will lead us in this next American century? Everyone who steps forward today, to get one addict off drugs. To convince one troubled teenager not to give up on life ... to comfort one AIDS patient to help one hungry child. We have within our reach the promise of a renewed America. We can find meaning and reward by serving some purpose higher than ourselves-a shining purpose, the illumination of a thousand points of light. It is expressed by all who know the irresistible force of a child's hand, of a friend who stands by you and stays there-a volunteer's generous gesture, an idea that is simply right. The problems before us may be different, but the key to solving them remains the same: it is the individual-the individual who steps forward. And the state of 2 our Union, is the union of each of us, one to the other: the sum of our friendships, marriages, families, and communities. We all have something to give. So if you know how to read, find someone who can't. If you've got a hammer, find a nail. If you're not hungry, not lonely, not in trouble-seek out someone who is. Join the community of conscience. Do the hard work of freedom. That will define the state of our union. Since the birth of our nation, "We the people" has been the source of our strength. What government can do alone is limited-but the potential of the American people knows no limits. We are a nation of rock-solid realism and clear-eyed idealism. We are Americans: We are the nation that believes in the future. We are the nation that can shape the future. And we've begun to do just that-by strengthening the power and choice of individuals, and families. Together, these last two years, we've put dollars for child care directly in the hands of parents, instead of bureaucracies. Unshackled the potential of Americans with disabilities. Applied the creativity of the marketplace in the service of the environ- ment, for clean air. And made home-ownership possible for more Americans. The strength of a democracy is not in bureaucracy. It is in the people, and their communities. In everything we do, let us unleash the potential of our most precious resource-our citizens. We must return to families, communities, counties, cities, states, and institutions of every kind, the power to chart their own destiny, and the freedom and opportunity provided by strong economic growth. That's what America is all about. I know, tonight, in some regions of our country, people are in genuine economic distress. I hear them. Earlier this month, Kathy Blackwell of Massachusetts wrote me about what can happen when the economy slows down, saying "My heart is aching, and I think that you should know-your people out here are hurting badly." I understand. And I'm not unrealistic about the future. But there are reasons to be optimistic about our economy. First, we don't have to fight double digit inflation. Second, most industries won't have to make big cuts in production, because they don't have big inventories piled up. And third, our exports are running solid and strong. In fact, American businesses are exporting at a record rate. So let's put these times in perspective. Together, since 1981, we've created almost 20 million jobs, cut inflation in half, and cut interest rates in half. Yes, the largest peacetime economic expansion in history has been temporarily interrupted. But our economy is still over twice as large as our closest competitor. We will get this recession behind us, and return to growth-soon. We will get on our way to a new record of expansion, and achieve the competitive strength that will carry us into the next American century. 3 We should focus our efforts today on encouraging economic growth, investing in the future, and giving power and opportunity to the individual. We must begin with control of federal spending. That's why I'm submitting a budget that holds the growth in spending to less than the rate of inflation. And that's why, amid all the sound and fury of last year's budget debate, we put into law new, enforceable spending caps-so that future spending debates will mean a battle of ideas, not a bidding war. Though controversial, the budget agreement finally put the Federal Government on a pay-as-you-go plan-and cut the growth of debt by nearly 500 billion dollars. And that frees funds for saving and job-creating investment. Now, let's do more. My budget again includes tax-free family savings accounts; penalty-free withdrawals from I.R.A.'s for first-time home-buyers; and, to increase jobs and growth, a reduced tax for long-term capital gains. I know there are differences among us about the impact and the effects of a capital gains incentive. So tonight, I am asking the Congressional leaders and the Federal Reserve to cooperate with us in a study-led by Chairman Alan Greenspan- to sort out our technical differences so that we can avoid a return to unproductive partisan bickering. But just as our efforts will bring economic growth now, and in the future, they must also be matched by long term investments for the next American century. That requires a forward looking plan of action-and that's exactly what we will be sending to the Congress. We have prepared a detailed series of proposals, that include: A budget that promotes investment in America's future-in children, education, infrastructure, space, and high technology. Legislation to achieve excellence in education-building on the partnership forged with the 50 governors at the Education Summit- enabling parents to choose their children's schools-and helping to make America #1 in math and science. A blueprint for a new National Highway System-a critical invest- ment in our transportation infrastructure. A research and development agenda that includes record levels of federal investment, and a permanent tax credit to strengthen pri- vate R & D, and create jobs. A comprehensive National Energy Strategy that calls for energy conservation and efficiency, increased development, and greater use of alternative fuels. A banking reform plan to bring America's financial system into the 21st Century-so that our banks remain safe and secure, and can continue to make job-creating loans for our factories, businesses and home-buyers. I do think there has been too much pessimism. 4 Sound banks should be making more sound loans, now-and interest rates should be lower, now. In addition to these proposals, we must recognize that our economic strength depends upon being competitive in world markets. We must continue to expand Ameri- ca's exports. A successful Uruguay Round of world trade negotiations will create more real jobs, and more real growth-for all nations. You and I know, that if the playing field is level, America's workers and farmers can out-work and out-produce anyone, anytime, anywhere. And with a Mexican Free Trade Agreement, and our Enterprise for the Americas Initiative, we can help our partners strengthen their economies, and move toward a free trade zone throughout this entire hemisphere. The budget also includes a plan of action right here at home to put more power and opportunity in the hands of the individual. That means new incentives to create jobs in our inner cities, by encouraging investment through enterprise zones. It also means tenant control and ownership of public housing. Freedom and the power to choose should not be the privilege of wealth. They are the birthright of every American. Civil Rights are also crucial to protecting equal opportunity. Every one of us has a responsibility to speak out against racism, bigotry, and hate. We will continue our vigorous enforcement of existing statutes, and I will once again press the Congress to strengthen the laws against employment discrimination without resorting to the use of unfair preferences. We're determined to protect another fundamental civil right-freedom from crime, and the fear that stalks our cities. The Attorney General will soon convene a Crime Summit of our nation's law enforcement officials. And to help us support them, we need tough crime control legislation, and we need it now. As we fight crime, we will fully implement our National Strategy for Combatting Drug Abuse. Recent data show we are making progress, but much remains to be done. We will not rest until the day of the dealer is over, forever. Good health care is every American's right, and every American's responsibility. So we are proposing an aggressive program of new prevention initiatives-for infants, for children, for adults, and for the elderly-to promote a healthier America, and to help keep costs from spiralling. It's time to give people more choice in government, by reviving the ideal of the citizen politician who comes not to stay, but to serve. One of the reasons there is so much support for term limitations is that the American people are increasingly concerned about big-money influence in politics. We must look beyond the next elec- tion, to the next generation. The time has come to put the national interest above the special interest-and totally eliminate Political Action Committees. That would truly put more competition in elections, and more power in the hands of individuals. And where power cannot be put directly in the hands of the individual, it should be moved closer to the people-away from Washington. The Federal Government too often treats government programs as if they are of Washington, by Washington, and for Washington. Once established, federal pro- grams seem to become immortal. 5 It's time for a more dynamic program life cycle: Some programs should increase. Some should decrease. Some should be terminated. And some should be consolidated and turned over to the States. My budget includes a list of programs for potential turn-over totalling more than $20 billion. Working with Congress and the Governors, I propose we select at least $15 billion in such programs and turn them over to the States in a single consolidated grant-fully funded-for flexible management by the States. The value of this turn-over approach is straightforward. It allows the Federal Government to reduce overhead. It allows States to manage more flexibly and more efficiently. It moves power and decision-making closer to the people. And it reenforces a theme of this Administration: appreciation and encouragement of the innovative power of "States as Laboratories." This nation was founded by leaders who understood that power belongs in the hands of people. They planned for the future. And so must we-here, and around the world. As Americans, we know there are times when we must step forward, and accept our responsibility to lead the world away from the dark chaos of dictators, toward the brighter promise of a better day. Almost 50 years ago we began a long struggle against aggressive totalitarianism. Now we face another defining hour for America and the world. There is no one more devoted, more committed to the hard work of freedom, than every soldier and sailor, every Marine, airman and Coastguardsman-every man and woman now serving in the Persian Gulf. Each of them has volunteered to provide for this nation's defense-and now they bravely struggle, to earn for America, for the world, and for future generations, a just and lasting peace. Our commitment to them must be the equal of their commitment to their country. They are truly America's finest. The war in the Gulf is not a war we wanted. We worked hard to avoid war. For more than five months we, along with the Arab League, the European Community, and the United Nations, tried every diplomatic avenue. U.N. Secretary General Perez de Cuellar; Presidents Gorbachev, Mitterand, Ozal, Mubarak and Bendjedid; Kings Fahd and Hassan; Prime Ministers Major and Andreotti-just to name a few-all worked for a solution. But time and again, Saddam Hussein flatly rejected the path of diplomacy and peace. The world well knows how this conflict began, and when: It began on August 2nd, when Saddam invaded and sacked a small, defenseless neighbor. And I am certain of how it will end. So that peace can prevail, we will prevail. Tonight, I'm pleased to report that we are on course. Iraq's capacity to sustain war is being destroyed. Our investment, our training, our planning-all are paying off. Time will not be Saddam's salvation. Our purpose in the Persian Gulf remains constant: to drive Iraq out of Kuwait, to restore Kuwait's legitimate government, and to ensure the stability and security of this critical region. 6 Let me make clear what I mean by the region's stability and security. We do not seek the destruction of Iraq, its culture, or its people. Rather, we seek an Iraq that uses its great resources, not to destroy, not to serve the ambitions of a tyrant, but to build a better life for itself, and its neighbors. We seek a Persian Gulf where conflict is no longer the rule, where the strong are neither tempted nor able to intimidate the weak. Most Americans know instinctively why we are in the Gulf. They know we had to stop Saddam now, not later. They know this brutal dictator will do anything; will use any weapon; will commit any outrage, no matter how many innocents must suffer. They know we must make sure that control of the world's oil resources does not fall into his hands, only to finance further aggression. They know that we need to build a new, enduring peace-based not on arms races and confrontation, but on shared principles, and the rule of law. And we all realize that our responsibility to be the catalyst for peace in the region does not end with the successful conclusion of this war. Democracy brings the undeniable value of thoughtful dissent-and we have heard some dissenting voices here at home-some reckless, most responsible. But the fact that all voices have the right to speak out is one of the reasons we've been united in purpose and principle for 200 years. Our progress in this great struggle is the result of years of vigilance, and a steadfast commitment to a strong defense. Now, with remarkable technological ad- vances like the Patriot missile, we can defend against ballistic missile attacks aimed at innocent civilians. Looking forward, I have directed that the SDI program be refocused on providing protection from limited ballistic missile strikes-whatever their source. Let us pursue an SDI program that can deal with any future threat to the United States, to our forces overseas, and to our friends and allies. The quality of American technology, thanks to the American worker, has enabled us to successfully deal with difficult military conditions, and help minimize loss of life. We have given our men and women the very best. And they deserve it. We all have a special place in our hearts for the families of our men and women serving in the Gulf. They are represented here tonight, by Mrs. Norman Schwarzkopf. We are very grateful to General Schwarzkopf, and to all those serving with him. And to the families, let me say, our forces in the Gulf will not stay there one day longer than is necessary to complete their mission. The courage and success of the RAF pilots-of the Kuwaiti, Saudi, French- the Canadians, Italians-the pilots of Qatar and Bahrain-all are proof that for the first time since World War II, the international community is united. The leadership of the United Nations, once only a hoped-for ideal, is now confirming its founders' vision. I am heartened that we are not being asked to bear alone the financial burden of this struggle. Last year, our friends and allies provided the bulk of the economic costs of Desert Shield, and having now received commitments of over $40 billion 7 for the first three months of 1991, I am confident they will do no less as we move through Desert Storm. But the world has to wonder what the dictator of Iraq is thinking. If he thinks that by targeting innocent civilians in Israel and Saudi Arabia, that he will gain advan- tage-he is dead wrong. If he thinks that he will advance his cause through tragic and despicable environmental terrorism-he is dead wrong. And if he thinks that by abusing the coalition POWs, he will benefit-he is dead wrong. We will succeed in the Gulf. And when we do, the world community will have sent an enduring warning to any dictator or despot, present or future, who contemplates outlaw aggression. The world can therefore seize this opportunity to fulfill the long-held promise of a new world order-where brutality will go unrewarded, and aggression will meet collective resistance. Yes, the United States bears a major share of leadership in this effort. Among the nations of the world, only the United States of America has had both the moral standing, and the means to back it up. We are the only nation on this earth that could assemble the forces of peace. This is the burden of leadership-and the strength that has made America the beacon of freedom in a searching world. This nation has never found glory in war. Our people have never wanted to abandon the blessings of home and work, for distant lands and deadly conflict. If we fight in anger, it is only because we have to fight at all. And all of us yearn for a world where we will never have to fight again. Each of us will measure, within ourselves, the value of this great struggle. Any cost in lives is beyond our power to measure. But the cost of closing our eyes to aggression is beyond mankind's power to imagine. This we do know: Our cause is just. Our cause is moral. Our cause is right. Let future generations understand the burden and the blessings of freedom. Let them say, we stood where duty required us to stand. Let them know that together, we affirmed America, and the world, as a community of conscience. The winds of change are with us now. The forces of freedom are united. We move toward the next century, more confident than ever, that we have the will at home and abroad, to do what must be done-the hard work of freedom. May God bless the United States of America. 8 THE WHITE HOUSE WASHINGTON January 31, 1991 MEMORANDUM FOR MARLIN FITZWATER FROM: JOHN UNDELAND & SUSAN TYNDALL, SOT NEWS SUMMARY RE: CONGRESSIONAL REACTION TO THE STATE OF THE UNION ADDRESS SEN. MITCHELL "The president's way (to bring the deficit down and jobs home) is to give huge tax cuts to those with incomes over $200,000 a year," Mitchell said in a Democratic response. "We disagree." (Reuter, 1/30) "As critical as the Gulf conflict is, the other business of the nation won't wait," Mitchell said in the Democratic response. "The president says he seeks a new world order. We ask him to join us in putting our own house in order. We have a crisis abroad. But we also have a crisis here at home." About the gulf, Mitchell said: "Now that war has begun, we'll work to see that it's swift and decisive, with the least possible loss of life." Mitchell said the nation's first domestic priority must be economic growth to end the current recession and the first step for growth was a national energy policy. (AP, 1/30) Mitchell said that Democrats support the war against Iraq, but he accused President Bush of ignoring injustice elsewhere in the world as well as needs at home. "We cannot oppose repression in one place and overlook it in another, Mitchell said in the Democratic response. "Students massacred in China, priests murdered in Central America, demonstrators gunned down in Lithuania -- these acts of violence are as wrong as Iraqi soldiers killing civilians," he said. Mitchell reminded the nation that through the 1980s Republican administrations helped build Saddam Hussein's army. "We can't repeat that kind of mistake," he said. And while Bush "says he seeks a new world order," Mitchell said, "we also have a crisis here at home. We ask him to join us in putting our own house in order," he said, with the first priority a program for economic growth. (AP, 1/29) REP. FOLEY Foley agreed with other Democrats that the cap gains proposal probably won't fly. "I don't think tax reduction is a good idea at this very moment," he said on NBC's "Today." (AP, 1/30) -erom- -2- FOLEY (continued) President Bush's promise of victory against Iraq drew cheers, but his State of the Union address left Democrats spoiling for a fight over his domestic agenda. "There need to be some things that are dealt with even while we're fighting a war," Foley said today. "We're clearly going to be united in the sense of bringing the war to an end," Foley said on NBC's "Today." (AP, 1/30) REP. GEPHARDT Gephardt promised cooperation from Congress "to turn his rhetoric into action so that we fight just as hard for our troops when they come home as they are fighting for us overseas." But, he said, "It will be made impossible if his only real prescription for the economy is cutting capital gains taxes for the wealthiest families while leaving the soldiers' families to fend for themselves." (AP, 1/30) "The administration can do what it wants on capital gains. But it's a mistake, it's wrong." (Miami Herald, 1/30) "We don't need SDI, we never did,' said Gephardt. He suggested the Patriot should be upgraded rather than millions of dollars spent on a strategic defense system. (Reuter, 1/30) Gephardt said the job [to prepare the public for a possibly bloody war] is not the president's alone. "We all have a responsibility to explain to the American people the costs, and it's not going to come without sacrifice." (AP, 1/30) SEN. NUNN Nunn said Bush's comments on the gulf conflict were "unifying and uplifting." (Washington Post, 1/30) REP. ASPIN "I think we have expectations that are unrealistic," said Aspin. The war so far has been "essentially devoid of casualties," creating "a standard impossible to match." The president, said Aspin, needs to prepare Americans for increased losses before a full-scale ground war begins. (AP, 1/30) REP. PANETTA Panetta said Bush in his speech "displays greater authority in confronting the war effort than in meeting the serious economic and domestic needs within our society." Panetta complained Bush offered little evidence that enough resources would be committed to the nation's problems. (Reuter, 1/30) Referring to Bush's proposal of Fed study of cap gains, Panetta said: "It's going into the deep, dark caverns of a commission [But] if the President decides to push it, then clearly Democrats are prepared to respond in kind" [implying a tax on millionaires]. (Wall Street Journal, 1/31) - -3- REP. GRAY "The bottom line is: It appears the administration is firing real bullets at Saddam Hussein and shooting blanks at home." (Washington Post, 1/30) REP. ROSTENKOWSKI "The chairman has no interest in seeing the capital-gains issue surface this year," said Patrick Jones, a spokesman for Rostenkowski. (AP, 1/30) SEN. BENTSEN "The president talked about capital gains in a throwaway line, which should tell you there are divisions within the administration on this one, said Bentsen. "I frankly don't think capital gains is going any place." (AP, 1/30) Bentsen said he was hopeful -- but skeptical -- about Bush's call for a "comprehensive national energy strategy. We have been promised an energy policy time and again over the past decade only to be let down each time." (Dallas Morning News, 1/30) Bentsen shared Mitchell's disappointment with the nation's health care policy, decrying "the president's failure to focus more on the serious problem of skyrocketing health care costs." (Houston Chronicle, 1/30) SEN. BIDEN "The only criticism that I would have is that tonight would have been the place where he prepared the American people for the sacrifices that would have to be made in a land war." (AP, 1/30) SEN. KENNEDY Kennedy commended the president for including a "strong emphasis" on domestic policy in the speech and said he was "encouraged" that Bush talked about domestic problems. "We need to devote as much energy and commitment to challenges at home, such as illness, ignorance, injustice and poverty, as we are to the Persian Gulf. Support for our troops also means support for the kind of America they are fighting for." (Boston Globe, 1/30) SEN. KERRY Kerry applauded the part of the speech dealing with the war, but said, "The domestic part of the speech was almost unreal. It lacked a kind of real commitment to the problems of people. I've heard for seven years talk about making the nation No. 1 in math and science, but year after year they don't put money in the education budget." (Boston Globe, 1/30) -елош- -4- REP. MAVROULES Bush touched on some good ideas, like tax credits for research and development and enterprise zones, "but now we're going to have to find out where the money will come from and how it will affect the deficit.' Otherwise, Bush "grasped the emotion of the nation. It was a little picker-upper." (Boston Globe, 1/30) REP. ESPY Espy said Bush "spent more time identifying the domestic agenda than I thought he would, and I was pleased by that." (Washington Post, 1/30) SEN. JOHNSTON "It was a call for unity in the Persian Gulf War. All the rest was background noise.' (Washington Post, 1/30) REP. FAZIO Fazio faulted Bush for failing to prepare the nation for what could be protracted, bloody war. "He wanted to retain the optimism that this is going to be short The opportunity was lost to talk about the difficult days ahead." [At the same time] Fazio praised Bush's efforts to convey a sense of national purpose. "It was an important opportunity to unify the country and he did it very well." (Washington Post, 1/30) REP. JOHN LEWIS "He did not prepare the American people for a long war or for the possibility of many, many casualties," said Lewis. (AP, 1/30) Lewis blasted the president's call for a civil rights legislation. "He vetoed the bill in 1990. We will send him the same bill. I think he is trying to talk out of both sides of his mouth without any sense of vision or blueprint for the 21st century. And on the question of the Persian Gulf, he didn't prepare the Americans for a long war. The applause was for the troops, not for him, but for the young men and women in the gulf." (Boston Globe, 1/30) SEN. BRADLEY Bradley said Bush's renewed proposal to cut taxes on capital gains "won't make health care or housing more affordable." (USA Today, 1/30) Bradley said the nation was properly focused on bringing the war to a successful end. "But I don't want to see the men and women serving in the gulf come home to find more burdens facing their families, higher taxes, a deeper recession, and a government that has continued to neglect very real human needs." (Boston Globe, 1/30) -елош- -5- SEN. ADAMS Adams said Bush had led the nation into war under the false notion that it would be quick and relatively easy. "He was misleading people. I think it was a mistake" not to prepare the country for what could be "a very cataclysmic event." (AP, 1/30) SEN. HARKIN Bush "never said anything" about the true costs of the war, said Harkin. "I believe the president set himself up for a great fall" by promising a long list of costly domestic policy initiatives in his speech, "then saying we're going to pay for this war.... Now that's a dead end, and he's going down the road 100 miles an hour.' (AP, 1/30) SEN. GORE Gore, who supported giving Bush the authority to take the nation to war, said the State of the Union speech would not have been an appropriate place for such somber messages [as Harkin & Adams called for]. Bush properly used it as "the place to define our goals and purposes" and did a good job at that, he said. (AP, 1/30) REP. OBEY Obey said the emphasis on the Persian Gulf war "shows how difficult it will be to focus the government's attention on the fact that there are a lot of Americans in trouble here at home. A year from now, the American people will have the right to ask: Did our government try to do as much for Americans as it did for Kuwaitis?" (Philadelphia Inquirer, 1/30) REP. DINGELL "I was very much disappointed about his remarks on domestic programs. I considered it almost entirely recycled legislation ...it has about the same appetizing qualities as last week's lunch." (Detroit News, 1/30) REP. COLLINS "I came because I didn't want to miss the experience of my first State of the Union address, and now I'm disappointed because it's more of the same. " (Detroit News, 1/30) SEN. ROBB Robb said that Bush succeeded in reinforcing the will of Americans to stand behind the troops. "But the rest of the speech looked like an attempt to include something on just about any subject that could be mentioned. There were a lot of buzzwords without much sense of purpose or program to them. I don't think anyone has any real expectations for much of an agenda." (Washington Post, 1/31) -елош- -6- REP. MOAKLEY "There are two wars going on. There is a war going on over there and a war going on in this country He gave drugs one line and education one line. He didn't go into specifics on the domestic problems." Moakley also said Democrats will fight any effort to cut the capital gains tax. (Boston Globe, 1/30) REP. JENKINS Cap gains cut backer Jenkins interpreted the call for a study as a way to shelve the issue. "Since they've asked for a study, it appears to me that takes it off the front burner." (Wall Street Journal, 1/31) SEN. GRAHAM Cap gains cut advocate Graham: "It's not a very high probability." (Wall Street Journal, 1/31) SEN. SARBANES "I think it's important that the president put forth a domestic agenda, although I don't think it truly came to grips with the problems we face." (Baltimore Evening Sun, 1/30) SEN. MIKULSKI Mikulski said Bush offered "no clear anti-recession plan. I am absolutely worried to death that the economy is going to be one of the casualties of war." Mikulski criticized Bush for not speaking more strongly about the Soviet Union's repression of the Baltics. (Baltimore Evening Sun, 1/30) Mikulski said the failure to address domestic problems will have serious consequences long after the Persian Gulf war is over. "When our guys and gals come back from the desert they want a job, they want their kids to be in good schools, and they want their streets to be safe. You can't do that by good intentions." (Washington Post, 1/31) REP. CARDIN "I particularly appreciated that he struck a balance between national and international [concerns]." (Baltimore Evening Sun, 1/30) REP. MCMILLEN "I think it was one of his best orations for making his case for being in the Persian Gulf." (Baltimore Evening Sun, 1/30) REP. GEREN Geren expressed dismay about Bush's vague prescription for a short recession. "We have been living with recession in Texas for five years. I don't know what he thinks is short or long." (Dallas Morning News, 1/30) -more- -7- REP. ATKINS "I think the Kathy Blackwells who don't have health insurance or who are struggling to pay for a mortgage deserve more than the warmed-over nostrums that the president gave." (Boston Globe, 1/30) REP. RANGEL Although Bush won standing applause for his war statements, Rangel remained seated when Bush declared, "Our cause is right.' (Reuter, 1/30) REP. CONYERS "The president has locked himself in his war room, leaving our domestic needs banging at the door. There is ample money to fight foreign wars or to bail out the savings and loans, but there are only scarce resources to restore our cities and our people's hopes. We are losing the fight to give our troops opportunities when they come home from the war. (AP, 1/29) REPUBLICANS SEN. DOLE Dole praised Bush for striking the right tone in his address. President Bush had his priorities right tonight. This was no time for an ordinary state of the union, it was really time for a state of unity message," he said. "We'll have plenty of time to roll up our sleeves and tackle the serious domestic agenda he outlined." (AP, 1/30) Dole called the speech "what our troops expected to hear from their commander in chief The president properly left politics at home and put national unity first." (USA Today, 1/30) REP. GINGRICH Gingrich said he liked what he heard from Bush, even on domestic issues. "I'm not sure that some conservatives will be happy under any circumstances. If you look hard enough, there will be reasons it isn't good enough. But it was a pretty good speech." (Washington Post, 1/31) "I think he was quite clear that freedom is not cost-free. He talked about the danger of dictators, of losing lives. I thought he was quite clear." (AP, 1/29) REP. MICHEL Michel said, "There's no question but that the regular domestic program tends to get somewhat downgraded because the prosecution of the war is paramount for all of us." At the same time, Michel added that the president made the point that despite the war, "Life goes on, the business of government goes on." (AP, 1/30) - -8- SEN. GRAMM Gramm said the speech was "a powerful and visionary message that set the Middle East conflict in context of the America's responsibility in a new world order." Gramm called Bush's bipartisan approach to a renewed proposal for capital gains tax cuts "an excellent way to try and find a way around Democratic opposition." (Houston Chronicle, 1/30) Gramm pronounced the president's address a skillful marriage of foreign and domestic concerns. "Trying to get a balance between the two is very difficult. He's achieved it." Gramm said the address was "a powerful speech. It's a visionary speech." (Dallas Morning News, 1/30 SEN. SIMPSON Congressional Republicans plan to push ahead with President Bush's proposed capital-gains tax cut despite stiff opposition from Democratic leaders. "If you have the votes you'll eventually get something passed,' said Simpson. He noted 66 House Democrats voted for the cut last year and predicted 12 to 15 Democratic senators will support it this year. (AP, 1/30) SEN. COCHRAN "The majority leader and other Democrats are trashing the president for being a Republican. They're taking cheap shots that he doesn't deserve." (Baltimore Sun, 1/30) REP. ARMEY Armey said he was impressed by the foreign policy part of the speech. "He just as well could have phoned in the rest of it." " (Washington Post, 1/31) REP. JERRY LEWIS "The bipartisan support indicates that the president will get the backing of the Congress he needs." (USA Today, 1/30) REP. VANDER JAGT Referring to Bush's call for a cap gains tax cut, Vander Jagt said: "It is a very difficult, uphill fight." (Wall Street Journal, 1/31) REP. ROHRABACHER "Until we see the follow-through and the implementation, he's not back in the good graces, not only of conservatives but of most Republicans" who oppose tax increases. Rohrabacher said he did like the speech itself. (Washington Post, 1/31) REP. LOWERY Conservative Republicans appeared especially delighted with Bush's domestic proposals. Lowery called them "completely unifying for House Republicans. It's a growth agenda." (Washington Post, 1/30) -елош- -9- REP. BARTLETT "It was a great speech. It was George Bush's finest. It was the right mix. He said what needed to be said about the war, but he also devoted a great deal of attention to the domestic side." (Dallas Morning News, 1/30) SEN. DOMENICI "The thing he did, and we helped him to do it, is he said we are united behind him to see that this war is won and that we are behind our armed forces." (Dallas Morning News, 1/30) Domenici praised the President's suggestion that some unspecified federal spending programs be terminated. "For the first time, we may get a priority debate." (Washington Post, 1/30) REP. PURSELL "The Democrats want to keep spending and building the federal bureaucracy, and he was saying throughout the whole speech, let's terminate $15 billion to $20 billion in programs here at the federal level and return government to the people. That was lined throughout that speech and they don't pick that up. (Detroit News, 1/30) REP. MORELLA "Given the backdrop of war, this has got to be one of the most difficult speeches he ever made. It was necessary he concentrate on the Middle East situation. He mentioned domestic issues more than I thought he would, albeit they were one-liners. I think it was an effective speech thematically, not with specificity." (Washington Post, 1/31) REP. FIELDS Fields called the speech "excellent. I have never seen anybody so cool. It shows we have a president who is a great leader." (Houston Chronicle, 1/30) REP. LAMAR SMITH Smith found the speech "all-encompassing, including a number of domestic policy initiatives as well as a report on the state of foreign affairs. I thought it was a good balance." (Houston Chronicle, 1/30) ### THE WHITE HOUSE Office of the Press Secretary EMBARGOED FOR RELEASE AND WIRE TRANSMISSION UNTIL 9:00 PM (EST) TUESDAY, JANUARY 29, 1991 THE PRESIDENT'S STATE OF THE UNION ADDRESS FACT SHEET The President's 1991 State of the Union address discussed: A New World Order Preparing for the Next American Century The War in the Gulf The President explained that he came to speak to the Congress and all Americans "certain that we stand at a defining hour." I. A NEW WORLD ORDER A. Peace and the Rule of Law The President declared that what is at stake in the Persian Gulf is more than just the independence of Kuwait. It is a new world order where diverse nations are brought together to give permanence to the universal aspirations of mankind: Peace and security; Freedom; and The rule of law. The world has "resisted the trap of appeasement, cynicism, and isolation" and is united in demanding Iraq's immediate and unconditional withdrawal from Kuwait. We are working to achieve victory over tyranny and lawless aggression. America has "a unique responsibility to do the hard work of freedom." -2- B. Constructive Change The President noted that "the end of the Cold War has been a victory for all humanity Germany is united. Europe has become whole and free -- and America's leadership was instrumental in making it possible." C. U.S.-Soviet Relations The President stated that "our relationship with the Soviet Union is important, not only to us, but to the world." It has contributed to positive, historic change. The President also noted that "like many other nations, we have been deeply concerned by the violence in the Baltics.' The President stated that in discussions with the Soviet leadership "we have been given representations, which, if fulfilled, would result in the withdrawal of some Soviet forces, a reopening of dialogue with the Republics, and a move away from violence." We will watch carefully as the situation develops; we will also maintain our contacts with Soviet leaders to encourage democratization and reform. II. PREPARING FOR THE NEXT AMERICAN CENTURY The President asserted that the spirit that is winning a victory for world peace and justice in the Persian Gulf is "the same spirit that gives us the power and the potential to meet our toughest challenges at home." The President called for "new initiative in government, in our communities, and from every American, to prepare for the next American century." The President encouraged all Americans to join the "community of conscience", asserting that "we have within our reach the promise of a renewed America." He said "we can find meaning and reward by serving some purpose higher than ourselves." The President called for "strengthening the power and freedom of choice of individuals and families." He declared that "the strength of a democracy is not in bureaucracy," but "in the people and their communities." The President called for the unleashing of "the potential of our most precious resource -- our citizens." This should be done by returning to "families, communities, counties, cities, states, and institutions of every kind, the power to chart their own destiny." -3- A. Encouraging Economic Growth The President explained that he understands the genuine economic distress experienced by many Americans. He offered three reasons to be optimistic about the economy: - Inflation is low; - Inventories are low; and - Exports are strong. The President expressed confidence that "we will get this recession behind us, and return to growth -- soon." Controlling Federal Spending and Enforcing the Budget Agreement The President declared that strong economic growth requires control of Federal spending. He will transmit a budget that holds the growth in spending to less than the rate of inflation. The budget agreement put the Federal government on a pay- as-you-go plan and cut the growth of debt by nearly $500 billion. Encouraging Savings and Investment The President explained that the budget agreement helped free private funds for savings and job-creating investment. In addition, the President announced that his budget again includes: Tax-free family savings accounts; Penalty-free withdrawals from IRAs for first- time home buyers; and A strengthened long-term capital gains incentive. He also asked congressional leaders, the Administration, and the Federal Reserve to cooperate in a study, led by Federal Reserve Chairman Alan Greenspan, to reach technical agreement on the budgetary and other economic effects of a strengthened capital gains incentive. -4- B. Investing in the Future The President said that we must match incentives for economic growth today with long-term investments for the next American century. Budget Priorities The President indicated that his FY 1992 budget priorities will include promoting investments in children, education, infrastructure, space, and high technology. Strengthening Education The President will propose a new Educational Excellence Act which contains strategic initiatives to improve the learning achievement of all Americans and to restructure the nation's educational system. Initiatives in the Educational Excellence Act will: Stimulate fundamental reform and restructure our education system through promoting educational choice and alternative certification for teachers and principals. Promote local control and innovation in education by providing increased flexibility in funding at the Federal and state levels in exchange for enhanced accountability. Assist educators in their mission to improve student performance by: rewarding schools that demonstrate improved achievement among students; rewarding excellent teachers; and providing innovation in training school administrators. Provide incentives to school districts to design and implement innovative approaches to mathematics and science education; enhance the endowments of Historically Black Colleges and Universities; and contribute to improving literacy. -5- Strengthening Transportation Infrastructure The President believes a strong highway system is a critical investment for our economic success. He indicated that he would shortly outline the details of a new National Highway System managed in partnership with the States. Enhancing Research and Development To strengthen our research and development capability and economic competitiveness the President will propose: A record Federal budget commitment to science and expanding the frontiers of knowledge, including basic research and making government research more available to the private sector for speedier commercialization; Increased support for generic or enabling technologies at the pre-competitive stage of R&D in such areas as high-performance computing, new energy technologies, and advanced manufacturing and materials; and Making permanent the R&E tax credit. Reducing Energy Vulnerability The President will soon present a comprehensive National Energy Strategy that calls for energy conservation and efficiency, increased domestic energy development, and greater use of alternative fuels. The elements of the strategy are designed to: Foster economic growth through the availability of ample supplies of reasonably priced energy; Enhance energy security by reducing vulnerability to oil disruptions; and Increase research and development of a wide range of promising energy technologies. Providing Financial Security The President said that we will continue to make sure banks are safe, sound, and able to provide adequate credit -6- for job-creating loans for factories, businesses, and homebuyers. He stated that "sound banks should be making more sound loans, now -- and interest rates should be lower, now." The Treasury will shortly unveil a plan to bring America's financial system into the 21st century. The elements of the plan are designed to: Continue to protect the deposits of America's workers and savers; Assure the safety, soundness, and competitiveness of our financial institutions; Create a regulatory system that is strong, simple, and streamlined; and Move toward a deposit insurance fund that is well capitalized with industry funds. Expanding World Trade The President called for an expansion of world trade, to create new opportunities for U.S. exports, which have grown by 23 percent over the past two years to nearly $400 billion. His priorities include: - Strengthening and expanding the world trading system through the swift and successful completion of the Uruguay Round of multilateral trade negotiations. These negotiations aim to open markets worldwide, lower government subsidies and trade barriers that distort agricultural markets, and establish rules of fair play in areas vital to U.S. competitiveness -- such as services, agriculture, and high technology. The lower trade barriers that would result from a successful Uruguay Round could increase world output by approximately $5 trillion over the next ten years, and U.S. output by $1 trillion. - A U.S. - Mexico Free Trade Agreement (FTA), first endorsed by President Bush and Mexico's President Carlos Salinas de Gortari in June 1990. -7- A comprehensive FTA would aim to eliminate barriers to trade in goods and services and investment between the United States and Mexico, as well as provide for the protection of intellectual property rights. It would free trade totalling $59 billion between the two countries. The FTA might also include Canada, thus creating the world's largest market, with 360 million consumers and $6 trillion in total output. - Implementing the Enterprise for the Americas Initiative, launched by President Bush last June. The President's initiative aims to spur economic growth and create jobs among the nations of the Western Hemisphere by removing barriers to trade and investment, and by reducing debt burdens. The initiative envisions the eventual development of a hemispheric zone of free trade. The United States has begun the process of opening markets to trade and investment with over a dozen countries in the region. The President will propose legislation to enable full implementation of the investment and debt reduction portions of the initiative. - Export Promotion. The Administration will be taking quality and export programs to cities around the country, to make certain that more U.S. firms know the export potential of top quality goods and services. C. Giving Power and Opportunity to the Individual The President announced an action plan to "put more power and opportunity in the hands of the individual." Creating Job Opportunities The President called for new incentives to create jobs in our inner cities by encouraging investment through enterprise zones. -8- Increasing Home Ownership The President also called for increasing tenant ownership and control of public housing to help build the bonds of community in neighborhoods that need help. Fighting Discrimination The President stated that "civil rights are also crucial to protecting equal opportunity." He called on all Americans to speak out against racism, bigotry, and hate. The President indicated that "we will continue our vigorous enforcement of existing statutes," and promised to press the Congress again "to strengthen the laws against employment discrimination without resorting to the use of unfair preferences." Protecting People From Crime and Combatting Drug Abuse The President described freedom from crime as a basic civil right and said that we must eradicate the fear that stalks our cities. - He announced that the Attorney General will soon convene a Crime Summit of our nation's law enforcement officials. - He called for prompt action on tough crime control legislation. The President will propose legislation that will include: A meaningful Federal death penalty for the most heinous crimes with procedures to ensure its fair and colorblind application; Habeas corpus reform to reduce unnecessarily repetitive appeals that clog the courts and delay justice; Exclusionary rule reform to ensure that evidence gathered by law enforcement officials in a good faith belief that they are acting lawfully can be used to help courts establish the truth; Provisions to strengthen Federal laws concerning the safety of women by modifying rules on the -9- admissibility of evidence in cases of sex crimes, enhancing penalties for the distribution of illegal drugs to pregnant women, increasing penalties for recidivist sex offenders, and offering greater protection for victims below the age of sixteen; and New authority to enhance international cooperation among law enforcement officials to combat international criminal activity, including international terrorism. - The President noted that recent data shows we are making progress in reducing drug abuse, but that much remains to be done. The Administration will soon release the third edition of the National Drug Control Strategy. This comprehensive strategy includes increased resources for drug prevention and education, treatment, law enforcement, and international initiatives. Enhancing Good Health Through Prevention The President stated that good health is every American's right and responsibility. He announced that he will propose an aggressive program of new prevention initiatives to promote a healthier America and to help control costs. The initiatives are designed to make Americans of all ages healthier. Infant health will be improved through an initiative that targets cities with exceptionally high infant mortality rates; Children will benefit from large increases in immunization resources; Adults will benefit from new efforts to promote physical activity and reduce injury, reduce tobacco use, and implementation of a new program to detect breast and cervical cancer; and Elderly women will benefit from mammography services newly available to Medicare beneficiaries. -10- Giving People More Choice in Government The President urged "reviving the ideal of the citizen politician who comes not to stay, but to serve." He endorsed term limitations in order to reduce the influence of special interests. He also endorsed election reform -- total elimination of Political Action Committees -- as necessary to put more power in the hands of individuals. D. Moving Government Closer to the People The President said that "where power cannot be put directly in the hands of the individual, it should be moved closer to the people -- away from Washington. " The President called for a more dynamic program life cycle. Some programs should increase; Some should decrease; Some should be terminated; and Some should be consolidated and turned over to the States. The President's Budget includes a list of potential programs for turnover totalling more than $20 billion. Working with the Governors and the Congress, the President proposed selecting at least $15 billion in such programs and turning them over to the States in a single consolidated grant, fully funded, for flexible management by the States. This initiative will: Allow the Federal Government to reduce overhead; Allow States to manage more flexibly and efficiently; Move power and decision-making closer to the people; and Encourage the innovative power of "States as Laboratories. " -11- III. THE WAR IN THE GULF A. The Heroism of Our Servicemen and Servicewomen The President said that, in this defining hour for America and the world, "there is no one more devoted, more committed to the hard work of freedom than every soldier and sailor, every Marine, airman and Coastguardsman -- every man and woman now serving in the Persian Gulf." He stated that our commitment to them must match their commitment to their country. B. We Are on Course The President said that while we worked hard to avoid war, Saddam Hussein repeatedly rejected the path of diplomacy and peace. But we will prevail; we are on course. "Iraq's capacity to sustain war is being destroyed Time will not be Saddam's salvation. C. Objectives in the Gulf The President reaffirmed our objectives: Drive Iraq from Kuwait. Iraq must comply with all relevant United Nations resolutions. Restore Kuwait's legitimate government. Kuwait will once again be free. Ensure stability and security in the Gulf region. It is our hope that Iraq will live as a peaceful and cooperative member of the family of nations. The President stated that most Americans know instinctively why we are in the Gulf -- "we had to stop Saddam now, not later." The President noted the undeniable value of thoughtful dissent. The right to speak out "is one of the reasons we've been united in purpose and principle for 200 years." D. Strategic Benefits of High Technology The President observed that our progress in the Gulf is the result of using American technology and economic -12- strength to minimize the risk to human life. Our men and women have the best and deserve the best. The President directed that the Strategic Defense Initiative (SDI) program be refocused on providing protection from limited ballistic missile strikes -- from whatever their source. E. The Unity of the International Community The President observed that for the first time in the post-war era, the international community is united. It has an opportunity to fulfill the long-held promise of a new world order -- where brutality goes unrewarded, and aggression meets collective resistance. The President praised the courage and success of the pilots of the coalition countries and the leadership provided by the United Nations, an organization that is now confirming its founders' vision. The President also commended our friends and allies who have provided the bulk of the financial costs of Desert Shield, and expressed confidence that they will similarly financially support Desert Storm. F. U.S. Determination is Great The President stated that Saddam will not benefit from targeting innocent civilians, from environmental terrorism, or by abusing POWs. We will succeed, and in the process send a powerful message to any dictator or despot who would follow Saddam's lead. G. The Special Role of U.S. Leadership The President stated that "the United States bears a major share of leadership" in the Gulf War effort. He noted that the burden of leadership is a "strength that has made America the beacon of freedom in a searching world." THE WHITE HOUSE Office of the Press Secretary For Immediate Release January 29, 1991 ADDRESS BY THE PRESIDENT ON THE STATE OF THE UNION The U.S. Capitol Washington, D.C. 9:09 P.M. EST THE PRESIDENT: Mr. President, and Mr. Speaker, and members of the United States Congress. I come to this House of the people to speak to you and all Americans, certain that we stand at a defining hour. Halfway around the world, we are engaged in a great struggle in the skies and on the seas and sands. We know why we're there. We are Americans -- part of something larger than ourselves. For two centuries, we've done the hard work of freedom. And tonight, we lead the world in facing down a threat to decency and humanity. What is at stake is more than one small country; it is a big idea: a new world order, where diverse nations are drawn together in common cause to achieve the universal aspirations of mankind -- peace and security, freedom, and the rule of law. Such is a (Applause.) world worthy of our struggle and worthy of our children's future. The community of nations has resolutely gathered to condemn and repel lawless aggression. Saddam Hussein's unprovoked invasion -- his ruthless, systematic rape of a peaceful neighbor -- violated everything the community of nations holds dear. The world has (Applause.) said this aggression would not stand -- and it will not stand. Together, we have resisted the trap of appeasement, cynicism, and isolation that gives temptation to tyrants. The world has answered Saddam's invasion with 12 United Nations resolutions, starting with a demand for Iraq's immediate and unconditional withdrawal and backed up by forces from 28 countries of six continents. With few exceptions, the world now stands as one. The end of the Cold War has been a victory for all humanity. A year and a half ago, in Germany, I said that our goal was a Europe whole and free. Tonight, Germany is united. Europe has become whole and free -- and America's leadership was instrumental in making it possible. (Applause.) Our relationship to the Soviet Union is important, not only to us, but to the world. That relationship has helped to shape these and other historic changes. But like many other nations, we have been deeply concerned by the violence in the Baltics, and we have communicated that concern to the Soviet leadership. The principle that has guided us is simple: Our objective is to help the Baltic peoples achieve their aspirations, not to punish the Soviet Union. (Applause.) In our recent discussions with the Soviet leadership, we have been given representations which, if fulfilled, would result in the withdrawal of some Soviet forces, a reopening of dialogue with the Republics, and a move away from violence. We will watch carefully as the situation develops. And we will maintain our contact with the Soviet leadership to encourage MORE - 2 - continued commitment to democratization and reform. (Applause.) If it is possible, I want to continue to build a lasting basis for U.S.-Soviet cooperation, for a more peaceful future for all mankind. The triumph of democratic ideas in Eastern Europe and Latin America, and the continuing struggle for freedom elsewhere all around the world all confirm the wisdom of our nation's founders. Tonight, we work to achieve another victory -- a victory over tyranny and savage aggression. We in this Union enter the last decade of the 20th century thankful for our blessings, steadfast in our purpose, aware of our difficulties, and responsive to our duties at home and around the world. For two centuries, America has served the world as an inspiring example of freedom and democracy. For generations, America has led the struggle to preserve and extend the blessings of liberty. And today, in a rapidly changing world, American leadership is indispensable. Americans know that leadership brings burdens and sacrifices. But we also know why the hopes of humanity turn to us. We are Americans: we have a unique responsibility to do the hard work of freedom. And when we do, freedom works. (Applause.) The conviction and courage we see in the Persian Gulf today is simply the American character in action. The indomitable spirit that is contributing to this victory for world peace and justice is the same spirit that gives us the power and the potential to meet our toughest challenges at home. We are resolute and resourceful. If we can selflessly confront evil for the sake of good in a land so far away, then surely we can make this land all that it should be. If anyone tells you that America's best days are behind her, they're looking the wrong way. (Applause.) Tonight, I come before this House and the American people with an appeal for renewal. This is not merely a call for new government initiatives; it is a call for new initiative in government, in our communities, and from every American -- to prepare for the next American century. America has always led by example. So who among us will set this example? Which of our citizens will lead us in this next American century? Everyone who steps forward today -- to get one addict off drugs, to convince one troubled teenager not to give up on life, to comfort one AIDS patient, to help one hungry child. We have within our reach the promise of a renewed America. We can find meaning and reward by serving some purpose higher than ourselves -- a shining purpose, the illumination of a thousand points of light. And it is expressed by all who know the irresistible force of a child's hand, of a friend who stands by you and stays there -- a volunteer's generous gesture, an idea that is simply right. The problems before us may be different, but the key to solving them remains the same. It is the individual the individual who steps forward. And the state of our Union is the union of each of us, one to the other -- the sum of our friendships, marriages, families, and communities. We all have something to give. So if you know how to read, find someone who can't. If you've got a hammer, find a nail. If you're not hungry, not lonely, not in trouble, seek out someone who is. Join the community of conscience. Do the hard work of freedom. And that will define the state of our Union. (Applause.) Since the birth of our nation, "We the people" has been the source of our strength. What government can do alone is limited -- but the potential of the American people knows no limits. MORE - 3 - We are a nation of rock-solid realism and clear-eyed idealism. We are Americans. We are the nation that believes in the future. We are the nation that can shape the future. And we've begun to do just that -- by strengthening the power and choice of individuals and families. Together, these last two years, we've put dollars for child care directly in the hands of parents instead of bureaucracies. (Applause.) Unshackled the potential of Americans with disabilities. (Applause.) Applied the creativity of the marketplace in the service of the environment, for clean air; and made home ownership possible for more Americans. (Applause.) The strength of a democracy is not in bureaucracy. It is in the people and their communities. In everything we do, let us unleash the potential of our most precious resource -- our citizens, our citizens themselves. We must return to families, communities, counties, cities, states, and institutions of every kind the power to chart their own destiny, and the freedom and opportunity provided by strong (Applause.) economic growth. And that's what America is all about. in genuine economic distress. And I hear them. I know tonight in some regions of our country, people are Earlier this month, Kathy Blackwell, of Massachusetts, wrote me about what can happen when the economy slows down, saying, here are hurting badly." "My heart is aching, and I think that you should know your people out I understand. And I'm not unrealistic about the future. But there are reasons to be optimistic about our economy. First, we don't have to fight double-digit inflation. Second, most industries won't have to make big cuts in production because they don't have big inventories piled up. And third, our exports are running solid and strong. In fact, American businesses are exporting at a record rate. So let's put these times in perspective. Together, since 1981, we've created almost 20 million jobs, cut inflation in half, and cut interest rates in half. And, yes, the largest peacetime economic expansion in history has been temporarily interrupted. But our economy is still over twice as large as our closest competitor. We will get this recession behind us and return to growth soon. (Applause.) We will get on our way to a new record of expansion and achieve the competitive strength that will carry us into the next American century. We should focus our efforts today on encouraging economic growth, investing in the future, and giving power and opportunity to the individual. (Applause.) We must begin with control of federal spending. (Applause.) That's why I'm submitting a budget that holds the growth in spending to less than the rate of inflation. And that's why, amid all the sound and fury of last year's budget debate, we put into law new, enforceable spending caps so that future spending debates will mean a battle of ideas, not a bidding war. (Applause.) Though controversial, the budget agreement finally put the federal government on a pay-as-you-go plan and cut the growth of debt by nearly $500 billion. And that frees funds for saving and job-creating investment. Now, let's do more. My budget again includes tax-free family savings accounts; penalty-free withdrawals from IRAs for first-time home buyers - (applause) -- and to increase jobs and MORE - 4 - growth, a reduced tax for long-term capital gains. (Applause.) I know there are differences among us -- (laughter) -- about the impact and the effects of a capital gains incentive. So tonight, I'm asking the congressional leaders and the Federal Reserve to cooperate with us in a study, led by Chairman Alan Greenspan, to sort out our technical differences so that we can avoid a return to unproductive partisan bickering. (Applause.) But just as our efforts will bring economic growth now and in the future, they must also be matched by long-term investments for the next American century. That requires a forward-looking plan of action -- and that's exactly what we will be sending to the Congress. We've prepared a detailed series of proposals that include: A budget that promotes investment in America's future -- in children, education, infrastructure, space, and high technology; legislation to achieve excellence in education -- building on the partnership forged with the 50 governors at the Education Summit, enabling parents to choose their children's schools and helping to make America number one in math and science; -- (applause) -- a blueprint for a new national highway system -- a critical investment in our transportation infrastructure; -- (applause) -- a research and development agenda that includes record levels of federal investment, and a permanent tax credit to strengthen private R&D and to create jobs; -- (applause) -- a comprehensive national energy strategy that calls for energy conservation and efficiency, increased development, and greater use of alternative fuels; -- (applause) -- into the 21st century so that our banks remain safe and secure and a banking reform plan to bring America's financial system can continue to make job-creating loans for our factories, our businesses and home-buyers. You know, I do think there has been too much pessimism. Sound banks should be making sound loans now -- and interest rates should be lower, now. (Applause.) In addition to these proposals, we must recognize that our economic strength depends on being competitive in world markets. We must continue to expand American exports. A successful Uruguay Round of world trade negotiations will create more real jobs and more real growth for all nations. You and I know that if the playing field is level, America's workers and farmers can out-work, out-produce anyone, anytime, anywhere. (Applause.) And with a Mexican Free Trade Agreement and our Enterprise for the Americas Initiative, we can help our partners strengthen their economies and move toward a free trade zone throughout this entire hemisphere. (Applause.) The budget also includes a plan of action right here at home to put more power and opportunity in the hands of the individual. And that means new incentives to create jobs in our inner cities, by encouraging investment through enterprise zones. It also means tenant control and ownership of public housing. Freedom and the power to choose should not be the privilege of wealth. They are the birthright of every American. (Applause.) Civil rights are also crucial to protecting equal opportunity. (Applause.) Every one of us has a responsibility to speak out against racism, bigotry, and hate. (Applause.) We will continue our vigorous enforcement of existing statutes, and I will MORE - 5 - once again press the Congress to strengthen the laws against employment discrimination without resorting to the use of unfair preferences. (Applause.) We're determined to protect another fundamental civil right freedom from crime and the fear that stalks our cities. The Attorney General will soon convene a crime summit of our nation's law enforcement officials. And to help us support them, we need tough crime control legislation, and we need it now. (Applause.) And as we fight crime, we will fully implement our national strategy for combatting drug abuse. Recent data show that we are making progress, but much remains to be done. We will not rest until the day of the dealer is over, forever. (Applause.) American's responsibility. And so we are proposing an aggressive Good health care is every American's right and every program of new prevention initiatives -- for infants, for children, for adults, and for the elderly -- to promote a healthier America and to help keep costs from spiralling. (Applause.) reviving the ideal of the citizen politician who comes not to stay, It's time to give people more choice in government, by but to serve. And one of the reasons that there is so much support across this country for term limitations is that the American people are increasingly concerned about big-money influence in politics. So we must look beyond the next election, to the next generation. And the time has come to put the national interest above the special interest (Applause.) -- and totally eliminate political action committees. And that would truly put more competition in elections, and more power in the hands of individuals. And where power cannot be put directly in the hands of the individual, it should be moved closer to the people -- away from Washington. The federal government too often treats government programs as if they are of Washington, by Washington, and for Washington. immortal. Once established, federal programs seem to become It's time for a more dynamic program life cycle: Some programs should increase. Some should decrease. Some should be terminated. And some should be consolidated and turned over to the states. (Applause.) My budget includes a list of programs for potential turnover totalling more than $20 billion. Working with Congress and the governors, I propose we select at least $15 billion in such programs and turn them over to the states in a single consolidated grant (Applause.) fully funded for flexible management by the states. The value -- the value of this turnover approach is straightforward. It allows the federal government to reduce overhead. It allows states to manage more flexibly and more efficiently. It moves power and decision-making closer to the people. And it reinforces a theme of this administration: Laboratories. appreciation and encouragement of the innovative powers of "States as This nation was founded by leaders who understood that power belongs in the hands of people. And they planned for the future. And so must we -- here and all around the world. As Americans, we know that there are times when we must step forward and accept our responsibility to lead the world away from the dark chaos of dictators, toward the brighter promise of a better day. Almost 50 years ago we began a long struggle against aggressive totalitarianism. Now we face another defining hour for MORE - 6 - America and the world. There is no one more devoted, more committed to the hard work of freedom, than every soldier and sailor, every Marine, airman, and Coastguardsman -- every man and woman now serving in the Persian Gulf. (Applause.) Oh, how they deserve - -- (applause) -- and what a fitting tribute to them. You see -- what a wonderful, fitting tribute to them. Each of them has volunteered -- volunteered to provide for this nation's defense -- and now they bravely struggle, to earn for America, for the world, and for future generations, a just and lasting peace. Our commitment to them must be equal to their commitment to their country. They are truly America's finest. (Applause.) The war in the Gulf is not a war we wanted. We worked hard to avoid war. For more than five months we, along with the Arab League, the European Community, the United Nations, tried every diplomatic avenue. U.N. Secretary General Perez de Cuellar; Presidents Gorbachev, Mitterrand, Ozal, Mubarak, and Bendjedid; Kings Fahd and Hassan; Prime Ministers Major and Andreotti -- just to name a few all worked for a solution. But time and again, Saddam Hussein flatly rejected the path of diplomacy and peace. The world well knows how this conflict began and when: It began on August 2nd, when Saddam invaded and sacked a small, defenseless neighbor. And I am certain of how it will end. So that peace can prevail, we will prevail. (Applause.) Thank you. Tonight, I am pleased to report that we are on course. Iraq's capacity to sustain war is being destroyed. Our investment, our training, our planning - all are paying off. Time will not be Saddam's salvation. Our purpose in the Persian Gulf remains constant: to drive Iraq out of Kuwait, to restore Kuwait's legitimate government, and to ensure the stability and security of this critical region. Let me make clear what I mean by the region's stability and security. We do not seek the destruction of Iraq, its culture, or its people. Rather, we seek an Iraq that uses its great resources, not to destroy, not to serve the ambitions of a tyrant, but to build a better life for itself and its neighbors. We seek a Persian Gulf where conflict is no longer the rule, where the strong are neither tempted nor able to intimidate the weak. Most Americans know instinctively why we are in the Gulf. They know we had to stop Saddam now, not later. They know that this brutal dictator will do anything; will use any weapon; will commit any outrage, no matter how many innocents suffer. They know we must make sure that control of the world's oil resources does not fall into his hands, only to finance further aggression. They know that we need to build a new, enduring peace -- based not on arms races and confrontation, but on shared principles and the rule of law. And we all realize that our responsibility to be the catalyst for peace in the region does not end with the successful conclusion of this war. Democracy brings the undeniable value of thoughtful dissent -- and we've heard some dissenting voices here at home -- some, a handful, reckless most responsible. But the fact that all voices have the right to speak out is one of the reasons we've been united in purpose and principle for 200 years. (Applause.) Our progress in this great struggle is the result of years of vigilance and a steadfast commitment to a strong defense. Now, with remarkable technological advances like the Patriot missile, MORE - 7 - we can defend against ballistic missile attacks aimed at innocent civilians. Looking forward, I have directed that the SDI program be refocused on providing protection from limited. ballistic missile strikes whatever their source. (Applause.) Let us pursue an SDI program that can deal with any future threat to the United STates, to our forces overseas, and to our friends and allies. The quality of American technology, thanks to the American worker, has enabled us to successfully deal with difficult military conditions and help minimize precious loss of life. We have given (Applause.) our men and women the very best. And they deserve it. We all have a special place in our hearts for the families of our men and women serving in the Gulf. They are represented here tonight by Mrs. Norman Schwarzkopf. (Applause.) We with him. And I might also recognize one who came with Mrs. are all very grateful to General Schwarzkopf and to all those serving Schwarzkopf Alma Powell, the wife of the distinguished Chairman of the Joint Chiefs. (Applause.) And to the families, let me say our forces in the Gulf will not stay there one day longer than is necessary to complete their mission. (Applause.) The courage and success of the RAF pilots, of the Kuwaiti, Saudi, French, the Canadians, the Italians, the pilots of Qatar and Bahrain -- all are proof that for the first time since World War II, the international community is united. The leadership of the United Nations, once only a hoped-for ideal, is now confirming its founders' vision. (Applause.) I am heartened that we are not being asked to bear alone the financial burdens of this struggle. Last year, our friends and allies provided the bulk of the economic costs of Desert Shield. And now, having received commitments of over $40 billion for the first three months of 1991, I am confident they will do no less as we move through Desert Storm. (Applause.) But the world has to wonder what the dictator of Iraq is thinking. If he thinks that by targeting innocent civilians in Israel and Saudi Arabia, that he will gain advantage, he is dead wrong. (Applause.) If he thinks that he will advance his cause through tragic and despicable environmental terrorism, he is dead wrong. (Applause.) And if he thinks that by abusing the coalition prisoners of war he will benefit, he is dead wrong. (Applause.) We will succeed in the Gulf. And when we do, the world community will have sent an enduring warning to any dictator or despot, present or future, who contemplates oulaw aggression. The world can, therefore, seize this opportunity to fulfill the long-held promise of a new world order, where brutality will go unrewarded and aggression will meet collective resistance. Yes, the United States bears a major share of leadership in this effort. Among the nations of the world, only the United States of America has both the moral standing and the means to back it up. We're the only nation on this Earth that could assemble the forces of peace. This is the burden of leadership and the strength that has made America the beacon of freedom in a searching world. This nation has never found glory in war. Our people have never wanted to abandon the blessings of home and work for distant lands and deadly conflict. If we fight in anger, it is only because we have to fight at all. And all of us yearn for a world where we will never have to fight again. Each of us will measure within ourselves the value of this great struggle. Any cost in lives -- any cost -- is beyond our power to measure. But the cost of closing our eyes to aggression is beyond mankind's power to imagine. MORE - 8 - This we do know: Our cause is just. Our cause is moral. Our cause is right. (Applause.) Let future generations understand the burden and the blessings of freedom. Let them say we stood where duty required us to stand. Let them know that, together, we affirmed America and the world as a community of conscience. The winds of change are with us now. The forces of freedom are together, united. We move toward the next century more confident than ever that we have the will at home and abroad to do what must be done, the hard work of freedom. May God bless the United States of America. Thank you very, very much. (Applause.) END 9:57 P.M. EST THE PRESIDENT'S STATE OF THE UNION SPEECH JANUARY 29, 1991 -- TALKING POINTS International: Halfway around the world we are engaged in the hard work of freedom. A new world order of peace, security, and the rule of law, is being built by the brave men and women now serving in the Persian Gulf. America stands with the United Nations, and armed forces from 28 countries, to reverse Saddam Hussein's aggression in the Gulf. We are on course and we will prevail. Highlights of the President's agenda for investment in the future: -- legislation to achieve excellence in education; -- support for research and development in technology; -- a comprehensive national energy strategy; -- a new national highway system; -- comprehensive new banking reform measures; -- a national drug strategy for combatting drug abuse and crime; and -- election law reform. Themes: America's future lies in unlocking every citizen's potential. The legislative accomplishments of the last year -- enhancing opportunities for Americans with disabilities, giving child care support directly to parents, and making affordable housing available to more Americans -- strengthen the power and freedom of choice for individuals and families. The President seeks to affirm America as a nation of principle, a nation without unfair barriers, preferences, or bias. A nation that protects and expands the potential of individuals while it creates new jobs and economic growth as a competitor in the global economy. A strong economy and expanded economic freedom are chief among the goals of the President's economic growth package, which includes tax-free family savings accounts, IRAs for first-time home-buyers, and incentives for long-term investment. President Bush called on every American to ready the nation for the future by working to enhance freedom at home, to foster freedom abroad, and to make America a community of conscience. BOND DONATELLI INCORPORATED November 26, 1990 The Honorable Edward M. Rogers, Jr. Deputy Assistant to the President and Executive Assistant to the Chief of Staff The White House Washington, D.C. 20500 Dear Ed: Enclosed are some general thoughts Rich and I put together on the economic dimension of future White House strategy. They are submitted in response to Governor Sununu's latest letter. Best of luck. Sincerely, Frank J. Donatelli 1414 Prince Street, Suite 300, Alexandria, Virginia 22314 (703) 684-5991 (703) 684-0538 Fax The best that can be said of this year's budget impasse is that it has finally ended. Time will tell what impact the resulting agreement has on the country's economic fortunes, but one thing we know already is that the political fortunes of the GOP have suffered serious damage. Consider the casualty list: (1) The President's "No New Taxes" pledge. The one campaign promise the President is most identified with and the glue that has held a diverse GOP coalition together, is now gone. (2) Republicans and the "rich." The GOP has been attacked daily as the "party of the rich." Democrats have been at least partially successful in driving a wedge between the GOP's middle and high income supporters. The latest Wall Street Journal poll finds the GOP identified as the party most interested in protecting the rich by 64% to 13%. (3) Economic Recession The Democrats are again predicting recession and an end to the "false prosperity" of the 1980's because of the large deficits -- due to the Reagan-Bush tax cuts for the wealthy. Thus the Democrats have formulated their "explanation" for the economic slowdown that can be adapted as a theme against the President himself in 1992. (4) Republicans and economic performance The public view that Republicans are superior to Democrats as the party best able to keep the economy strong, hold taxes down, and restrain spending has been badly eroded. The Journal finds the Democrats are now favored as the party best able to keep the economy strong (31-26) and for dealing with taxes (39-28), a stunning turnaround from the last decade. (5) Competence and Ideology The President's image of "competence" has been tarnished by the many Administration "flip flops" on tax policy. The national economic debate, which has been dominated by Republicans at least since the tax revolt of 1978 (save the recession year of 1982), and which has emphasized low taxes and spending, optimism about the future, deregulation of the economy, and free and fair trade is now being replaced by Democratic arguments for increased taxes on the very wealthy, targeted federal programs to assist the "middle class", economic nationalism to save jobs, and reregulation of key sectors of the economy to prevent future S&L debacles. The 1992 presidential cycle began the day after the mid-term elections ended. Democratic candidates will begin refining their campaign themes. Democratic leaders in Congress will focus on legislative priorities designed to frame an advantageous agenda 1 beginning with renewed efforts to enact a "millionaire's surtax." For the GOP, it is critical that the economic debate be refocused on the Republican economic agenda. The White House needs to revamp its rhetoric and include several new elements. (1) Defend the Reagan-Bush Record. Democrats have had a field day attacking the "greed" and "false prosperity" of the 1980s. The President was a key player in the Reagan-Bush Administration and his political fortunes are heavily influenced by the public perception of the recent past. A stronger defense of the decade that saw record increases in employment and lower inflation and interest rates is critical to any future Republican prospects. (2) Reestablish the growth message. Republicans have been successful by emphasizing a mixture of growth and opportunity. The public will support a program that emphasizes growth instead of redistribution. This year's budget submission should include positive proposals to get the economy moving again such as capital gains tax cuts, expanded IRAs, enterprise zones, and privatization. The costs would be paid from spending reductions. Such a program would be an attractive contrast to the next Democratic tax increase proposal. (3) Bring back the Misery Index. The Democratic economic legacy of the late 1970s is still a heavy burden for the party to carry. The Democratic program of tax and spending increase, protectionism and reregulation would certainly deepen a recession, not prevent one. Whatever the judgement on the 1980's, most everyone thinks the 1970's were worse. (4) Pick a fight and win. The President is uncomfortable with confrontation in domestic policy. Nevertheless, he needs to confront his critics on a key issue, with no compromise and, most importantly, win. Such an approach would give added definition to his program and refurbish his image as a strong and competent chief executive. (5) Talk to the public. The public is more pessimistic about the direction of the country and the economy than in the recession year of 1982. And why not - when Democratic gloom and doom pronouncements go unanswered? You would think unemployment is 10% again, not its current 5.7% rate. The White House can no longer ignore public opinion. No more secret deals with the Congress. The President needs to speak often directly to the people on behalf of his programs, build public support for them, and prepare the people for new public policy initiatives. If he doesn't define his objectives, his opponents will. 2 Election year rhetoric is important in determining how successful candidates are in communicating their established themes to the electorate, but it is in the year(s) before the election that the themes are developed and refined. For the GOP, the refinement cannot commence a moment too soon. 3 Jan. 31 / Administration of George Bush, 1990 Address Before a Joint Session of the A year ago in Poland, Lech Walesa de- Congress on the State of the Union clared that he was ready to open a dialog January 31, 1990 with the Communist rulers of that country; and today, with the future of a free Poland Mr. President, Mr. Speaker, Members of the in their own hands, members of Solidarity United States Congress: lead the Polish Government. I return as a former President of the A year ago, freedom's playwright Vaclav Senate and a former Member of this great Havel languished as a prisoner in Prague. House. And now, as President, it is my And today it's Vaclav Havel, President of privilege to report to you on the state of Czechoslovakia. the Union. And 1 year ago, Erich Honecker, of East Tonight I come not to speak about the Germany, claimed history as his guide, and state of the Government, not to detail he predicted the Berlin Wall would last an- every new initiative we plan for the coming other hundred years. And today, less than 1 year nor to describe every line in the year later, it's the Wall that's history. budget. I'm here to speak to you and to the Remarkable events-events that fulfill American people about the state of the the long-held hopes of the American Union-about our world-the changes people; events that validate the longstand- we've seen, the challenges we face, and ing goals of American policy, a policy based what that means for America. on a single, shining principle: the cause of There are singular moments in history, freedom. dates that divide all that goes before from America, not just the nation but an idea, all that comes after. And many of us in this alive in the minds of people everywhere. As chamber have lived much of our lives in a this new world takes shape, America stands world whose fundamental features were de- at the center of a widening circle of free- fined in 1945; and the events of that year dom-today, tomorrow, and into the next decreed the shape of nations, the pace of century. Our nation is the enduring dream progress, freedom or oppression for millions of every immigrant who ever set foot on of people around the world. these shores, and the millions still struggling Nineteen forty-five provided the common to be free. This nation, this idea called frame of reference, the compass points of America, was and always will be a new the postwar era we've relied upon to under- world-our new world. stand ourselves. And that was our world, At a workers' rally, in a place called until now. The events of the year just Branik on the outskirts of Prague, the idea ended, the revolution of '89, have been a called America is alive. A worker, dressed chain reaction, changes so striking that it in grimy overalls, rises to speak at the facto- marks the beginning of a new era in the ry gates. He begins his speech to his fellow world's affairs. citizens with these words, words of a distant Think back-think back just 12 short revolution: "We hold these truths to be self- months ago to the world we knew as 1989 evident, that all men are created equal, that began. they are endowed by their Creator with One year-one year ago, the people of certain unalienable Rights, and that among Panama lived in fear, under the thumb of a these are Life, Liberty and the pursuit of dictator. Today democracy is restored; Happiness." Panama is free. It's no secret that here at home freedom's Operation Just Cause has achieved its ob- door opened long ago. The cornerstones of jective. The number of military personnel this free society have already been set in in Panama is now very close to what it was place: democracy, competition, opportunity, before the operation began. And tonight I private investment, stewardship, and of am announcing that well before the end of course leadership. And our challenge today February, the additional numbers of Ameri- is to take this democratic system of ours, a can troops, the brave men and women of system second to none, and make it better: our Armed Forces who made this mission a a better America, where there's a job for success, will be back home. everyone who wants one; where women 146 Administration of George Bush, 1990 / Jan. 31 working outside the home can be confident We need to save more. We need to their children are in safe and loving care expand the pool of capital for new invest- and where government works to expand ments that need more jobs and more child-care alternatives for parents; where growth. And that's the idea behind a new we reconcile the needs of a clean environ- initiative I call the Family Savings Plan, ment and a strong economy; where "Made which I will send to Congress tomorrow. in the USA" is recognized around the world We need to cut the tax on capital gains, as the symbol of quality and progress; encourage risktakers, especially those in our where every one of us enjoys the same op- small businesses, to take those steps that portunities to live, to work, and to contrib- translate into economic reward, jobs, and a ute to society and where, for the first time, better life for all of us. the American mainstream includes all of We'll do what it takes to invest in Ameri- our disabled citizens; where everyone has a roof over his head and where the homeless ca's future. The budget commitment is get the help they need to live in dignity; there. The money is there. It's there for where our schools challenge and support research and development, R&D-a record our kids and our teachers and where all of high. It's there for our housing initiative- them make the grade; where every street, HOPE-to help everyone from first-time every city, every school, and every child is homebuyers to the homeless. The money's drug-free; and finally, where no American is there to keep our kids drug-free-70 per- forgotten-our hearts go out to our hostages cent more than when I took office in 1989. who are ceaselessly on our minds and in our It's there for space exploration. And it's efforts. there for education-another record high. That's part of the future we want to see, And one more thing: Last fall at the edu- the future we can make for ourselves, but cation summit, the Governors and I agreed dreams alone won't get us there. We need to look for ways to help make sure that our to extend our horizon, commit to the long kids are ready to learn the very first day view. And our mission for the future starts they walk into the classroom. And I've today. made good on that commitment by propos- In the tough competitive markets around ing a record increase in funds-an extra the world, America faces the great chal- half-a-billion dollars-for something near lenges and great opportunities. And we and dear to all of us: Head Start. know that we can succeed in the global Education is the one investment that economic arena of the nineties, but to meet means more for our future because it means that challenge, we must make some funda- the most for our children. Real improve- mental changes-some crucial investment ment in our schools is not simply a matter in ourselves. of spending more: it's a matter of asking Yes, we are going to invest in America. more-expecting more-of our schools, our This administration is determined to en- teachers, of our kids, of our parents, and courage the creation of capital, capital of all ourselves. And that's why tonight I am an- kinds: physical capital-everything from our nouncing America's education goals, goals farms and factories to our workshops and developed with enormous cooperation from production lines, all that is needed to the Nation's Governors. And if I might, I'd produce and deliver quality goods and qual- like to say I'm very pleased that Governor ity services; intellectual capital-the source Gardner [Washington] and Governor Clin- of ideas that spark tomorrow's products; ton [Arkansas], Governor Branstad [Iowa], and of course our human capital-the tal- Governor Campbell [South Carolina], all of ented work force that we'll need to com- whom were very key in these discussions, pete in the global market. these deliberations, are with us here to- Let me tell you, if we ignore human cap- night. ital, if we lose the spirit of American inge- By the year 2000, every child must start nuity, the spirit that is the hallmark of the school ready to learn. American worker, that would be bad. The The United States must increase the high American worker is the most productive school graduation rate to no less than 90 worker in the world. percent. 147 Jan. 31 / Administration of George Bush, 1990 And we are going to make sure our tion Agency to Cabinet rank-not more bu- schools' diplomas mean something. In criti- reaucracy, not more red tape, but the cer- cal subjects-at the 4th, 8th, and 12th tainty that here at home, and especially in grades-we must assess our students' per- our dealings with other nations, environ- formance. mental issues have the status they deserve. By the year 2000, U.S. students must be This year's budget provides over $2 bil- first in the world in math and science lion in new spending to protect our envi- achievement. ronment, with over $1 billion for global Every American adult must be a skilled, change research, and a new initiative I call literate worker and citizen. America the Beautiful to expand our nation- Every school must offer the kind of disci- al parks and wildlife preserves that improve plined environment that makes it possible recreational facilities on public lands, and for our kids to learn. And every school in something else, something that will help America must be drug-free. keep this country clean from our forestland Ambitious aims? Of course. Easy to do? to the inner cities and keep America beauti- Far from it. But the future's at stake. The ful for generations to come: the money to Nation will not accept anything less than excellence in education. plant a billion trees a year. These investments will keep America And tonight let me say again to all the competitive. And I know this about the Members of the Congress: The American American people: We welcome competi- people did not send us here to bicker. tion. We'll match our ingenuity, our energy, There is work to do, and they sent us here our experience and technology, our spirit to get it done. And once again, in the spirit and enterprise against anyone. But let the of cooperation, I offer my hand to all of competition be free, but let it also be fair. you. Let's work together to do the will of America is ready. the people: clean air, child care, the Educa- Since we really mean it and since we're tional Excellence Act, crime, and drugs. It's serious about being ready to meet that chal- time to act. The farm bill, transportation lenge, we're getting our own house in policy, product-liability reform, enterprise order. We have made real progress. Seven zones-it's time to act together. years ago, the Federal deficit was 6 percent And there's one thing I hope we will be of our gross national product-6 percent. In able to agree on. It's about our commit- the new budget I sent up 2 days ago, the ments. I'm talking about Social Security. To deficit is down to 1 percent of gross nation- every American out there on Social Securi- al product. ty, to every American supporting that That budget brings Federal spending system today, and to everyone counting on under control. It meets the Gramm- it when they retire, we made a promise to Rudman target. It brings that deficit down you, and we are going to keep it. further and balances the budget by 1993 We rescued the system in 1983, and it's with no new taxes. And let me tell you, sound again-bipartisan arrangement. Our there's still more than enough Federal budget fully funds today's benefits, and it spending. For most of us, $1.2 trillion is still assures that future benefits will be funded a lot of money. as well. The last thing we need to do is And once the budget is balanced, we can mess around with Social Security. operate the way every family must when it There's one more problem we need to has bills to pay. We won't leave it to our address. We must give careful consideration children and our grandchildren. Once it's to the recommendations of the health-care balanced, we will start paying off the na- studies underway now. That's why tonight tional debt. I'm asking Dr. Sullivan, Lou Sullivan, Secre- And there's something more we owe the tary of Health and Human Services, to lead generations of the future: stewardship, the a Domestic Policy Council review of recom- safekeeping of America's precious environ- mendations on the quality, accessibility, and mental inheritance. cost of our nation's health-care system. I am It's just one sign of how serious we are: committed to bring the staggering costs of we will elevate the Environmental Protec- health care under control. 148 Administration of George Bush, 1990 / Jan. 31 The state of the Government does indeed and one of the first to fall. But he knew depend on many of us in this very chamber. what he believed in. He carried the idea we But the state of the Union depends on all call America in his heart. Americans. We must maintain the demo- I began tonight speaking about the cratic decency that makes a nation out of changes we've seen this past year. There is millions of individuals. I've been appalled at a new world of challenges and opportuni- the recent mail bombings across this coun- ties before us, and there's a need for leader- try. Every one of us must confront and con- ship that only America can provide. Nearly demn racism, antisemitism, bigotry, and 40 years ago, in his last address to the Con- hate, not next week, not tomorrow, but gress, President Harry Truman predicted right now-every single one of us. such a time would come. He said: "As our The state of the Union depends on world grows stronger, more united, more whether we help our neighbor-claim the attractive to men on both sides of the Iron problems of our community as our own. Curtain, then inevitably there will come a We've got to step forward when there's time of change within the Communist trouble, lend a hand, be what I call a point of light to a stranger in need. We've got to world." Today, that change is taking place. take the time after a busy day to sit down For more than 40 years, America and its and read with our kids, help them with allies held communism in check and en- their homework, pass along the values we sured that democracy would continue to learned as children. That's how we sustain exist. And today, with communism crum- the state of the Union. Every effort is im- bling, our aim must be to ensure democra- portant. It all adds up. It's doing the things cy's advance, to take the lead in forging that give democracy meaning. It all adds up peace and freedom's best hope: a great and to who we are and who we will be. growing commonwealth of free nations. Let me say that so long as we remember And to the Congress and to all Americans, I the American idea, so long as we live up to say it is time to acclaim a new consensus at the American ideal, the state of the Union home and abroad, a common vision of the will remain sound and strong. peaceful world we want to see. And to those who worry that we've lost Here in our own hemisphere, it is time our way-well, I want you to listen to parts for all the peoples of the Americas, North of a letter written by Private First Class and South, to live in freedom. In the Far James Markwell, a 20-year-old Army medic East and Africa, it's time for the full flower- of the 1st Battalion, 75th Rangers. It's dated ing of free governments and free markets December 18th, the night before our that have served as the engine of progress. armed forces went into action in Panama. It's time to offer our hand to the emerging It's a letter servicemen write and hope will democracies of Eastern Europe so that con- never be sent. And sadly, Private Mark- tinent-for too long a continent divided- well's mother did receive this letter. She can see a future whole and free. It's time to passed it along to me out there in Cincin- build on our new relationship with the nati. Soviet Union, to endorse and encourage a And here is some of what he wrote: "I've peaceful process of internal change toward never been afraid of death, but I know he is democracy and economic opportunity. waiting at the corner. I've been trained to We are in a period of great transition, kill and to save, and so has everyone else. I great hope, and yet great uncertainty. We am frightened what lays beyond the fog, recognize that the Soviet military threat in and yet do not mourn for me. Revel in the Europe is diminishing, but we see little life that I have died to give you. But most change in Soviet strategic modernization. of all, don't forget the Army was my choice. Therefore, we must sustain our own strate- Something that I wanted to do. Remember gic offense modernization and the Strategic I joined the Army to serve my country and Defense Initiative. ensure that you are free to do what you But the time is right to move forward on want and live your lives freely." a conventional arms control agreement to Let me add that Private Markwell was move us to more appropriate levels of mili- among the first to see battle in Panama, tary forces in Europe, a coherent defense 149 Jan. 31 / Administration of George Bush, 1990 program that ensures the U.S. will continue Now, I know you're probably thinking, to be a catalyst for peaceful change in Well, that's just a grandfather talking. Well, Europe. And I've consulted with leaders of maybe you're right. But I've met a lot of NATO [North Atlantic Treaty Organiza- children this past year across this country, tion]. In fact, I spoke by phone with Presi- as all of you have, everywhere from the Far dent Gorbachev just today. East to Eastern Europe. And all kids are I agree with our European allies that an unique, and yet all kids are alike-the bud- American military presence in Europe is es- ding young environmentalists I met this sential and that it should not be tied solely to the Soviet military presence in Eastern month, who joined me in exploring the Europe. But our troop levels can still be Florida Everglades; the little leaguers I lower. And so, tonight I am announcing a played catch with in Poland, ready to go major new step for a further reduction in from Warsaw to the World Series; and even U.S. and Soviet manpower in central and the kids who are ill or alone-and God bless eastern Europe to 195,000 on each side. those boarder babies, born addicted to This level reflects the advice of our senior drugs and AIDS and coping with problems military advisers. It's designed to protect no child should have to face. But you know, American and European interests and sus- when it comes to hope and the future, tain NATO's defense strategy. A swift con- every kid is the same-full of dreams ready clusion to our arms control talks-conven- to take on the world-all special, because tional, chemical, and strategic-must now they are the very future of freedom. And to be our goal. And that time has come. them belongs this new world I've been Still, we must recognize an unfortunate speaking about. fact: In many regions of the world tonight, And so, tonight I'm going to ask some- the reality is conflict, not peace. Enduring thing of every one of you. Now, let me start animosities and opposing interests remain. And thus, the cause of peace must be with my generation, with the grandparents served by an America strong enough and out there. You are our living link to the sure enough to defend our interests and our past. Tell your grandchildren the story of ideals. It's this American idea that for the struggles waged at home and abroad, of sac- past four decades helped inspire this revolu- rifices freely made for freedom's sake. And tion of '89. tell them your own story as well, because Here at home and in the world, there's every American has a story to tell. history in the making, history to be made. And, parents, your children look to you Six months ago, early in this season of for direction and guidance. Tell them of change, I stood at the gates of the Gdansk faith and family. Tell them we are One Shipyard in Poland at the monument to the Nation under God. Teach them that of all fallen workers of Solidarity. It's a monu- the many gifts they can receive liberty is ment of simple majesty. Three tall crosses their most precious legacy and of all the rise up from the stones, and atop each cross, gifts they can give the greatest is helping an anchor, an ancient symbol of hope. others. The anchor in our world today is free- dom, holding us steady in times of change, And to the children and young people a symbol of hope to all the world. And free- out there tonight: With you rests our hope, dom is at the very heart of the idea that is all that America will mean in the years and America. Giving life to that idea depends decades ahead. Fix your vision on a new on every one of us. Our anchor has always century-your century, on dreams we been faith and family. cannot see, on the destiny that is yours and In the last few days of this past momen- yours alone. tous year, our family was blessed once And finally, let all Americans-all of us more, celebrating the joy of life when a together here in this chamber, the symbolic little boy became our 12th grandchild. center of democracy-affirm our allegiance When I held the little guy for the first time, to this idea we call America. And let us the troubles at home and abroad seemed remember that the state of the Union de- manageable and totally in perspective. pends on each and every one of us. 150 Administration of George Bush, 1990 / Feb. 1 God bless all of you, and may God bless The President has concluded that this this great nation, the United States of proposal reflects the minimum level of U.S. America. forces needed in Europe to protect Ameri- can interests and to sustain NATO's strategy Note: The President spoke at 9:05 p.m. in of forward defense and flexible response. the House Chamber of the Capitol. He was Even if-as we expect-Soviet forces in this introduced by Thomas S. Foley, Speaker of region are reduced even further, the the House of Representatives. The address United Stated does not envision the further was broadcast live on nationwide radio and reduction of its forces in Europe below this television. Prior to his address, the President new level. attended a reception in the Speaker's Con- ference Room hosted by the congressional leadership. Remarks at the Annual National Prayer Breakfast February 1, 1990 White House Fact Sheet on the President's Conventional Armed Forces Thank you, ladies and gentlemen. Thank in Europe Initiative you all. Thank you very, very much. Vice January 31, 1990 President and Mrs. Quayle, and Chuck Grassley, Sam Nunn, and my dear friend After initial discussions with NATO allies, Billy Graham, and Ruth. Jim Baker, that the President concluded that changes was a very inspiring testament of faith. I which have taken place in Europe over the also want to salute our very special guests last 3 months have made it possible to pro- who have traveled far to join us in a prayer pose lower levels in the area of greatest for peace and understanding: President Moi concentration of forces: central and eastern of Kenya; President Ershad of Bangladesh; Europe. However, the United States will Major Buyoya, the marvelous head of Bu- maintain significant military forces in rundi; President Cristiani, a longtime friend; the Prime Minister Kisekka. And I Europe as long as our allies desire our pres- ence as part of a common security effort. just express for all of us a very hearty wel- Therefore, in his State of the Union Ad- come, and to President Ershad, a happy birthday greeting to go with Bev Shea's. dress to Congress on January 31, President We're delighted you're here. Bush proposed to revise NATO's current And I want to thank Bev Shea and Billy. position in the Conventional Armed Forces It'll probably read: Prayer Breakfast, Bev in Europe (CFE) negotiations to lower sub- Shea; Supporting Cast: Secretary of State; stantially the levels of U.S. and Soviet Billy Graham. [Laughter] A lot of Presi- ground and air force manpower in central dents out here, Senators and Congressmen. and eastern Europe to 195,000 on each side. Forces withdrawn will be demobilized. He was magnificent. [Laughter] Magnifi- cent music. There would be approximately 225,000 U.S. It's often said in my line of work that a ground and air force personnel in Europe candidate or a proposal hasn't got a prayer. after CFE reductions are completed. The Well, I'm pleased to be with an audience proposal responds to rapid changes in east- about whom that will never be said. ern Europe and is designed to help propel [Laughter] And this breakfast is the result the CFE negotiations to an early conclusion of years of quiet diplomacy-I wouldn't say in 1990. secret diplomacy-quiet diplomacy by an The President's initiative would super- ambassador of faith, Doug Coe. And I salute sede an earlier proposal establishing a level him. of 275,000 each of U.S. and Soviet ground And I was moved once again by what and air force manpower stationed outside of Sam and Liz told us of Members and staff- their respective national territories in the ers on the Hill who like to regularly meet Atlantic to the Urals region. to share a few quiet moments of prayer and 151 Skake of XLe Union NOVEMBER 6. 1990 The Washington Post page A6 Stumping in Texas, Bush Pounds 'Pundits' Poll Shows President's Approval Rating Up After Campaign-Swing Focus on Gulf By Ann Devroy Washington Post Staff Writer "Hold onto your wallets, they' after you, every single one of you," Bush told his audi- TYLER, Tex., Nov. 5-After attacking ences. the usual suspects-the tax-and-spend, In his final day, Bush also included what weak-on-crime liberal Democrats-Presi- has been a standard segment on Iraq in which dent Bush today saved the last of his 1990 he pledged, "I will give the sanctions time to midterm political criticism for Washington work. I hope and pray there will never be a "pundits." shot fired in anger." But, he added, "there Launching a three-stop Texas tour for the will be no compromise" with Saddam Hus- GOP ticket, Bush took on "all these great sein. "Unchecked and uncontrolled aggres- inside-the-Beltway experts telling us every- sion could be world war tomorrow." thing that's wrong with the United States." An ABC News poll conducted over the The president urged his audience to "go weekend found that Bush's job approval rat- the polls and say what's right about it." He ing has rebounded in recent days as the cited the Texas candidacies of Republicans president has focused on the crisis in the Clayton Williams for governor and Phil Middle East in speeches around the coun- Gramm for Senate as two things right about try. The survey of 1,015 adults found that America. 59 percent approved of the job Bush was Launching into an extemporaneous end doing as president, up from 51 percent in an to his stump speech here, Bush mocked "the ABC poll completed early last week. cynics, these Washington pundits that we After a day campaigning, Bush returned 130 Houston to sign the budget reconciliation get on these tiring shows all the time. I package and 13 appropriation bills that had don't know if you're like I am, maybe you've been the center of so much political turmoil enjoyed these things, but I can only take so the past two months. much self-flagellation." Fitzwater said he did not believe an elec- To wild cheering, Bush shouted, "Don't tion-eve signing of such unpopular legisla- tell me what's wrong about this country, tion would have any effect on the voting. "It show us what's right. Get out and do your is a deficit-cutting bill the country needs," civic duty." he said. "Got to do the country's business." The Tyler stop was one of three rallies Bush addressed before returning to Hous- ton, his legal residence, where he will vote Tuesday. The president will have spent three days in Texas, after campaigning the past week in Massachusetts, Florida, Ohio, Minnesota, Iowa and New Mexico. White House Press Secretary Marlin Fitzwater said that regardless of how Re- publicans do Tuesday, the president will continue to campaign for GOP candidates. That's "just the way he feels about the party and about campaigning. He'll always do it," Fitzwater said. Asked whether Bush will take some credit if Republicans do well, Fitzwater joked, "I expect we will claim vic- tory no matter what happens." In Texas, Bush got enthusiastic greetings all across the state where he was introduced as a "great Texas president" by Gramm. Bush steered clear of mentioning Dem- ocratic gubernatorial candidate Ann Rich- ards by name, even when he was campaign- ing in her home territory in Waco. But he joked there that he was late because he and Williams "set off the metal detectors with our silver feet." And he grinned widely when Gramm attacked her and said, "Anr Richards does not speak for Texas wher she attacks our Texas President." Richards was the keynote speaker at the 1988 Democratic National Convention, where she mockingly attacked Bush, saying he was born with a "silver foot" in his mouth. Here and on his other stops, Bush ac- cused the Democrats of engaging in "that tired, liberal, divide class warfare rhetoric about soaking the rich" when in fact, he said, their budget proposals would increase taxes for middle-income Americans. page 5 of 10/31/90 12:26 201539 4025 POLYCONOMICS 002/004 Skake of of KLe Union POLYCONOMICS. INC. Political and Economic Communications Jude Wanniski President 86 Maple Avenue Morristown, NJ 07960 Tel. 201-267-4640 Fax. 201-539-4025 October 31, 1990 ER - INFO The Hon. John Sununu Chief of Staff The White House Washington, D.C. 20500 Dear John: The President could make a major, positive difference on the outcome of next Tuesday's elections with a Sunday night paid political spot of only a minute or two, urging voter turnout on behalf of a growth agenda in the 102nd Congress. If you can get one voter in every precinct to show up for the GOP instead of staying home, you can prevent a rout and save a lot of candidates now on the ropes. They have to have a positive incentive to vote. The President has to announce he is going to challenge the Democrats throughout 1991 to drop their clacc warfare baloney and pass a capital gains tax for the nation at large, and a zero percent capgains tax for the inner cities. By linking the two thoughts together, it is clear the issue is growth vs. stagnation. He should mention the Democrats have blocked the urban enterprise zone idea for 10 years! The President's message in the final days should NOT BE plastering the Democrats as the party of tax and spend -- a message that lost for the GOP for half a century. He should ridicule the Democratic pledge to tax millionaires: why don't we just shoot them all? But primarily he must hammer on the strategy of capital tax cuts for growth. Ask Bob Teeter what he thinks. I believe he will agree this would make a difference. Sincerely, as always, Juan Jude Wanniski 10/31/90 12:10 201539 4025 POLYCONOMICS 001 POLYCONOMICS, INC. Political and Economic Communications THE NEXT TWO YEARS To judge by the telephone calls in the last few days, the despair among Polyconomics' clients about the next two years of the Bush Administration is so complete that what remains of my patented optimism seems almost perverse. The dominant school of thought, which includes many of the Reaganauts in Washington's political and intellectual circles, is that the real George Bush has revealed himself in the last several weeks as a man without vision or solid beliefs, that he doesn't even realize how thoroughly he has been humiliated by the Democrat brain-trust, that he isn't going to change, that we are stuck with him, and should dig in for the duration; it is utterly hopeless to expect him to repair his presidency in any meaningful way. A smaller, less abject school assumes there will be serious soul-searching by the President and his family and friends after next Tuesday's elections. GOP congressional leadership will chip in with gloves-off advice. So will the Cabinet. And as a result, changes will be made in people and policies. It only takes a few people in key posts to screw up an entire government. It only takes a few changes to get things humming again. At this point, though, it takes an unusual degree of optimism to believe the President will know what changes to make. If we stand back for a moment, we can begin to rebuild our confidence about the future with the simple realization that even successful political revolutions have to expect to surmount counterrevolutionary forces. As mighty as they may seem, the Democrats are not an especially interesting force. The class-warfare themes they've been playing lately are so moth-eaten that the Democrat leaders are rightly astonished that they've worked at all. The Gipper would have shredded that stratagem, as he often did when they would dust it off. No, the really interesting political party remains the GOP. What we've seen this year was certainly messy, but it may have been the Last Hurrah of the Old Guard. When three out of four House Republicans voted with Rep. Newt Gingrich against the White House budget deal with the Democrats, it should have been clear the party's base is solidly with its growth wing. These backbenchers, who for the most part were originally attracted to the banner of growth and opportunity Rep. Jack Kemp ran up in 1976, are getting stronger each year, not weaker. If President Bush is to win re-election in 1992, he will have to accommodate his party's future, not its past. In 1980, the Reagan Revolution wrested power away from the austerity forces that had dominated the Republican agenda for half a century. George Bush, of course, had come out of that tradition, but in the Reagan years, as Vice President, he seemed swept up by the success of the revolutionary economic ideas at their center. In his New Orleans "read my lips" acceptance speech, he seemed converted, but in politics, conversions are rarely complete. The idea that deficits are immoral has been the curse of the GOP from Hoover to Dewey, Goldwater, Nixon and Ford, a guilt trip the Democrats have gleefully encouraged. The Old Guard in the Bush Cabinet, as exemplified by Treasury Secretary Nick Brady, has always been vulnerable to the assertion that the Reagan growth years were bought by credit-card deficits. In 1981, the Old Guard captured David Stockman at the budget bureau with the immorality argument, spawning the nation's worst recession since the 1930s. In 1990, Richard Darman, arch-enemy of "now-nowism," became the budget moralist in his quest for a deal at any price. Until the very last moment, the growth forces had pinned their hopes on White House chief of staff John Sununu, who had promised there would be no deal without a capital-gains tax cut to offset the contractionary elements of the summit deal. When Sununu, who was wedged between Brady and Darman, caved in, the rout within the administration was complete. In blocking the first deal, Newt Gingrich performed an incredibly important service to his Republican Party. Without his leadership, the growth wing of the GOP would have been without a leader, Housing Secretary Jack Kemp being inside the Cabinet, bound hand and foot. Had Gingrich 86 Maple Avenue Morristown, N.J. 07960 201/267-4640 10/31/90 12: 12 201539 4025 POLYCONOMICS 002 not elevated the opposition, we could not now be contemplating a vigorous reassertion of the GOP's growth wing next year. It would be scattered and demoralized. The White House is putting out the word that Gingrich forced them to agree to a worse deal, in order to get Democrats to pass what Republicans would not. The argument itself displays a certain intellectual vacuity that is the hallmark of the unprincipled pragmatist. To the naked eye, both junk piles that Gingrich tried to sweep from the House floor were of equal height. The stir he made thrilled the growth forces in the GOP. The battle was lost, but the banner is still being carried in strategic retreat. Regrouping for 1991 and beyond will be most successful if it does not assume that President Bush will come 'round automatically. Gingrich cannot expect in January, when the Democrats put forward their latest plan to tax the rich with a millionaire surtax, that the Bush administration will be any more successful in countering this political theatre than they were this year. House and Senate Republicans will be advancing their own growth agenda in January, not out of any inflated idea that the Democrat Congress will lie down and adopt it. They will have to prepare for 1992 and the Republican platform, and a Presidential race with or without George Bush at the top of the ticket. Unless the President makes some critical changes in his economic and political team, he will continue to find himself floundering with a divided and dispirited party, sinking in the polls. As the GOP cannot be united under an austerity banner, the only alternative is a return to growth. The President's tendency, of course, will be to reach down into his bag of old acquaintances even in putting together a White House reorganization. It is already in the breeze that an "economic post" will 80 to retiring Rep. Bill Frenzel of Minnesota, who the President knows from his days on House Ways and Means in 1967-70. Frenzel is dyed-in-the-wool, the ranking Republican on the House Budget Committee, whose chief economist is Martha Phillips, wife of Kevin Phillips, who has been among the most relentless foes of the Reagan Revolution. Among the most important posts to be filled is a political one, the chairmanship of the Republican National Committee. From the earliest days of the Bush Administration, RNC Chairman Lee Atwater has been incapacitated by a malignant brain tumor. Because he is one of the few political operatives who enjoys the confidence of the President, Atwater's absence as an active player this year left Darman and Sununu in complete charge of the political scene. Robert Teeter, the President's pollster, had been counseling a growth strategy from the beginning of the year. But all critics of the Darman budget strategy have been muffled on the grounds that he is in charge, and that's that. Atwater at full strength, could have broken through the palace guard. Other GOP operatives like Ed Rollins of the House Campaign Committee were alarmed at the process throughout, but could not get a hearing. Clearly the best choice for RNC Chairman would be Jack Kemp, at least at this point with the GOP having been successfully recast by the Democrats as The Party of the Rich. More than any other Republican, Kemp is identified with the poor, the homeless, the minorities, economic growth and entrepreneurial capitalism. Kemp at the RNC would send the strongest signal that the Bush Administration is getting back on that track. At the RNC, especially with the President contemplating 1992, Kemp would be a player to be reckoned with in economic policymaking, not the outsider he has been to date. The GOP would recoup the youth vote and make deep inroads in black and Hispanic America. Kemp would have two dozen African-Americans recruited to run for Congress by '92. One would instantly have to bet on Bush's re-election if he appointed Kemp. Who, though, is the front- runner for the RNC? I'm told that it is the President's loyal friend Robert Mosbacher, Secretary of Commerce, yachtsman, polo player, and one of the wealthiest men in the Cabinet. Sununu as chief of staff would have been exemplary, but for his excessive confidence in and unalloyed support of Darman. Even now, Sununu is taking most of the heat for the budget debacle, demonstrating the ability of Darman to deflect criticism from himself. It's at least possible to imagine Sununu recovering and functioning well in the next two years of a growth administration. It's hard to imagine Darman hanging around, however. Now that he has bagged his $490 billion Deal, he would simply be pushing around peanuts, and he will never again enjoy the confidence in his skills that the President and Sununu placed in him. One would hope that Treasury Secretary Nicholas Brady would resign after more than two hapless years on his beat. There are any number of younger growth- oriented Wall Streeters who the President knows from the Yale Alumni Club who could quickly get Treasury in shape. I will send the names if asked. I'd really love to be bullish on Bush again. Jude Wanniski October 31, 1990 Skake of the Union ER - INFO THE WHITE HOUSE WASHINGTON October 29, 1990 MEMORANDUM FOR GOVERNOR SUNUNU FROM: EDE HOLIDA MA SUBJECT: Jack Kemp's Economic Empowerment Task Force Secretary Kemp sent out the attached letter last week announcing the first meeting of the DPC Economic Empowerment Task Force on November 15. He has asked each agency to bring ideas for empowering low-income people to that meeting for discussion. Leading up to that meeting the Task Force will probably have one or two meetings with outside experts, such as Stuart Butler of the Heritage Foundation, to educate the group on what it means to empower people. These ad hoc meetings would be chaired by Charles Kolb, who acts as the coordinator for the Task Force. I will keep you updated on the activities of the Economic Empowerment Task Force. Attachment SUMMATMENT AND' / U.S. DEPARTMENT OF HOUSING AND URBAN DEVELOPMENT THE SECRETARY WASHINGTON, D.C. 20410 October 23, 1990 MEMORANDUM FOR: Members of the Domestic Policy Council (DPC) Economic Empowerment Task Force FROM: Jack Kemp, Chairman Kemp SUBJECT: First Task Force Meeting The first meeting of the Domestic Policy Council's Economic Empowerment Task Force will take place on November 15, 1990, from 10:00 to 11:30 a.m. in the Roosevelt Room of the White House, and will be for principals only. Enclosed is a copy of the charter which outlines the President's mandate to our Task Force. Please come prepared to discuss what your Department can contribute to this ambitious and important undertaking. With this in mind, I'd like to ask you to prepare a brief presentation--about five minutes in length--outlining three or more ideas to empower low-income Americans which could be implemented in your Department. Don't limit yourself to short- term, incremental changes in existing programs. Although such modifications will play a role in developing our anti-poverty agenda, I want all of us to be challenged, especially in this planning stage, to consider ambitious, far-reaching ideas. Please submit your ideas in writing to Anna Kondratas, Assistant Secretary of HUD for Community Planning and Development, by COB November 5, 1990. Also, please call Charles Kolb, Deputy Assistant to the President for Domestic Policy and staff coordinator of the Task Force, to confirm your attendance. I look forward to seeing you at the first Economic Empowerment Task Force meeting. A list of Task Force members is enclosed. Enclosures THE WHITE HOUSE WASHINGTON September 4, 1990 MEMORANDUM FOR THE VICE PRESIDENT THE SECRETARY OF THE TREASURY THE SECRETARY OF INTERIOR THE SECRETARY OF AGRICULTURE THE SECRETARY OF LABOR THE SECRETARY OF HEALTH AND HUMAN SERVICES THE SECRETARY OF HOUSING AND URBAN DEVELOPMENT THE SECRETARY OF EDUCATION THE DIRECTOR OF THE OFFICE OF MANAGEMENT AND BUDGET THE CHAIRMAN OF THE COUNCIL OF ECONOMIC ADVISORS THE ADMINISTRATOR OF THE SMALL BUSINESS ADMINISTRATION THE ASSISTANT TO THE PRESIDENT FOR ECONOMIC AND DOMESTIC POLICY SUBJECT: Economic Empowerment Task Force As approved by the President, an Economic Empowerment Task Force will be formed under the Domestic Policy Council to continue the development and coordinate the implementation of the Administration's anti-poverty agenda. The Task Force replaces and succeeds the Low Income Opportunity Board and will report to the President through the Domestic Policy Council. The Economic Empowerment Task Force will: 1) advance the Administration's comprehensive economic empowerment strategy; 2) identify new initiatives consistent with the principles of the Administration's economic empowerment and budget policies; 3) coordinate the review of current programs by each Department, including a study of the distributional effects of existing programs; and 4) develop and implement proposals to integrate services and move toward a "client-centered" approach. The Secretary of Housing and Urban Development will chair the Task Force. Task Force members shall be Assistant Secretary rank or higher. Staff assistance will be provided by each Department 88 needed and coordinated by the Deputy Assistant to the President for Domestic Policy. The chairman of the Task Force will coordinate its activities with the Executive Secretary to the Domestic Policy Council. 2 Please forward the name of your agency's representative to John Schall, Deputy Executive Secretary to the Domestic Policy Council, at 456-7090 as soon as possible. Thank you very much for your cooperation. ONLA Dick Thurnburgh Chairman Pro Tempore Domestic Policy Council ECONOMIC EMPOWERMENT TASK FORCE Membership as of September 18, 1990 CHAIRMAN The Honorable Jack Kemp Secretary of Housing & Urban Development Rm. 10000 451 - 7th St., S.W. Washington, D.C. 20410 PHONE: 708-0417 (Leah Levy) FAX #: 708-2476 MEMBERS John Schall Deputy Executive Secretary to the Domestic Policy Council Rm. 222 Old EOB The White House Washington, D.C. 20500 PHONE: 456-7090 (Mary Tsivgoulis) FAX #: 456-2223 OR 456-7739 Charles Kolb Deputy Assistant to the President for Domestic Policy 2d Floor/West Wing The White House Washington, D.C. 20500 PHONE: 456-6515 (Peggy Smith) FAX #: 456-2878 Richard (Dick) Schmalensee Member Council of Economic Advisers Rm. 315 Old EOB Washington, D.C. 20500 PHONE: 395-5036 (Francine) FAX #: 395-6947 Thomas (Tom) Scully Associate Director for Human Resources, Veterans and Labor Office of Management and Budget Rm. 262 Old EOB Washington, D.C. 20500 PHONE: 395-5178 (Margaret) FAX #: 395-7289 - 2 - Allan (Al) Hubbard Assistant to the Vice President for Domestic Policy Rm. 286 Old EOB The White House Washington, D.C. 20500 PHONE: 456-6614 (Tracey St. Pierre) FAX #: 395-4031 Anna Kondratas Assistant Secretary for Community Planning and Development Dept. of Housing & Urban Development Rm. 7100 451 - 7th St., S.W. Washington, D.C. 20410 PHONE: 708-2690 (Stella Patterson) FAX #: 708-3363 Catherine Bertini Assistant Secretary for Food & Consumer Services Dept. of Agriculture Rm. 207-W Administration Building 14th & Independence Ave., S.W. Washington, D.C. 20250 PHONE: 447-7711 (Gerri Strickland) FAX #: 475-3100 Helen E. (Betsy) Brand Assistant Secretary for the Office of Vocational and Adult Education Dept. of Education Rm. 4090 Switzer Building 330 C St., S.W. Washington, D.C. 20202-7100 PHONE: 732-2251 (Elaine Matthews) FAX #: 732-3897 Roberts T. Jones Assistant Secretary for Employment & Training Administration Dept. of Labor Rm. S-2307 Washington, D.C. 20210 PHONE: 523-6050 (Jean) FAX #: 523-6827 - 3 - William Lucas Director, Office of Liaison Services Dept. of Justice Rm. 4213 Main Justice Washington, D.C. 20530 PHONE: 514-3465 (Doris Brown) FAX #: 514-2504 Frank A. Bracken Undersecretary of Interior Dept. of Interior Rm. 5100 Main Interior Washington, D.C. 20240 PHONE: 208-4863 (Doris Johnston) FAX #: 208-7508 Martin Gerry Assistant Secretary for Planning and Evaluation Dept. of Health & Human Services Rm. 415-F Humphrey Building 200 Independence Ave., S.W. Washington, D.C. 20201 PHONE: 245-1858 (Mary Williams) FAX #: (Try First -- 245-6518 OR 472-6927 OR 245-6699) Sidney L. Jones Assistant Secretary for Economic Policy Dept. of the Treasury Rm. 3454 Main Treasury Washington, D.C. 20220 PHONE: 566-2551 (Patsy Kinser) FAX #: 786-8452 Mitchell Crusto Associate Deputy Administrator for Finance, Investment and Procurement Small Business Administration Suite 900 1441 L St., N.W. Washington, D.C. 20416 PHONE: 653-2842 (Brenda McClough) FAX #: 653-2262 Miss 3ty Union zile October 1, 1990 MEMORANDUM RE: A "Post-Budget Summit" Economic Agenda This memo presents a menu of economic reforms that could be incorporated into the President's "post-budget summit" economic agenda this Fall. The proposals are presented in four sections: Tax Proposals, Spending Proposals, Competitiveness Proposals, and Reforming Government. TAX PROPOSALS Reduce the Capital Gains Tax Reducing tax rates on capital gains would promote investment and increase economic growth, help American businesses compete in the global environment, increase receipts for the Treasury, and increase jobs and the quality of life for all Americans. Allen Sinai, of the Boston Company Economic Advisor recently testified before Congress that a full-scale 50 percent capital gains cut would increase total GNP by 2.8 percent ($155 billion) by 1995. Capital Losses Deductibility; Indexing of Capital Gains Allowing capital losses to be deductible and indexing of gains against inflation would enhance growth and competitiveness, and return to the original intentions behind the tax code's treatment of capital gains. Reform the Corporate Income Tax Establishing a cash-flow corporate income tax would eliminate the current bias in favor of debt. Businesses could expense all new investments. For foreign-owned business subsidiaries: examine the problem of transfer pricing in determining whether such businesses are paying the proper amount of tax. -2- Increase the Personal Exemption The federal income tax burden on American families with children has soared by over 2,500 percent since 1948, far beyond increases faced by single individuals and married couples without children. To have the same value relative to income it held in 1948, today's personal exemption would have to be raised to about $6,300. Certain public policy organizations with special expertise in family policy, such as the Family Research Council and the Heritage Foundation, recommend increasing the personal exemption on federal tax payments beyond its current level of $2,000 per dependent, arguing that this would greatly reduce the financial burden of maintaining a family. The Progressive Policy Institute, an offshoot of the Democratic Leadership Council, in its recent report "Putting Children First,' suggests increasing the personal income tax exemption for children to at least $6,000. Thomas Humber of the Heritage Foundation proposes increasing the personal exemption to $6,300. Humber writes: "Restoring the personal exemption to the equivalent of its level after World War II would allow that family to keep thousands of dollars more of its own money, making the family less dependent on government, improving access to health care, child care and education opportunities, and giving the working poor a fighting chance to climb out of poverty." O Expand The Earned Income Tax Credit The Earned Income Tax Credit (EITC) promotes family stability and self-sufficiency by targeting assistance to low-income families with children. Unlike many other welfare programs, the EITC is available to two-parent families as well as single-parent households. It encourages work rather than dependency, and provides greater benefits as income increases. Given these benefits of the EITC, many policy experts, including those at the US Chamber of Commerce, the Progressive Policy Institute, the Heritage Foundation and politicians of both political parties have called for an expansion of the EITC. The Republican party pledged to expand it in its 1988 platform: " we will work to boost -3- the incomes of the working poor through the earned income tax credit, especially for workers who support children." Most of these proposals call for increasing the credit, tying the credit to the number of children in a family, and making more workers eligible. Reform Pension/Retirement Plans Rep. Newt Gingrich recently proposed creating "IRA Plus" accounts that would give Americans greater flexibility to use their retirement accounts in medical emergencies or to send a child to college without early-withdrawal penalties. Gingrich also proposed allowing penalty-free withdrawal from IRAs or 401(k) retirement plans to buy a house for the first time. Reduce Social Security Taxes Since the Social Security system was created in 1935, the burden of federal payroll taxes on middle-income families has risen continuously. Eighty percent of all American families now pay more in federal payroll taxes than they do in federal income taxes. A Social Security payroll tax deduction could return Social Security to a pay-as-you-go-system, increase fuel productivity and job creation while reducing unemployment and welfare dependency. Recent proposals to reduce the payroll tax include those by the Progressive Policy Institute, the Heritage Foundation, Senator Pat Moynihan and Rep. Newt Gingrich. Eliminate the Social Security Earnings Test The "earnings test," which reduces Social Security benefits for working senior citizens, imposes marginal tax rates of 50 to 70 percent on many elderly workers, and thus discourages many senior citizens from working. The federal tax code should not discourage older Americans from holding jobs and contributing to economic growth. The Heritage Foundation recommends eliminating the earnings test for workers between the ages of 65 and 69, and Sen. Armstrong introduced legislation last session to increase the income threshold level on the earnings test so that it adversely affects fewer elderly workers. -4- Allow Ownership of Social Security Individuals could have title to their Social Security accounts, thereby permitting a person ownership of at least what he or she paid in, plus interest. Establish A 19.5 Percent Flat Rate Tax A flat tax would have the benefits of simplicity (and therefore greater public respect) and significantly pro- growth supply-side effects. Such a plan would work by greatly simplifying the existing scheme of deductions. The structure of a system with a 19.5 percent rate would look something like the following: Deductions would be phased out between $50,000 and $100,000 of earned income and/or $1,000 and $51,000 of unearned income. Deductions could only be taken against earned income: -- Mortgage interest with ceiling $6,000 -- Charitable giving with ceiling (50 percent of income for cash, 30 percent for assets). -- Medical expenses in excess of 7.5 percent of income. -- Employee contributions to social security. -- Earned income deduction of $6,000 plus 20 percent of earnings up to $25,000. In addition, there could be an Refundable Dependant Exemption element as follows: -- 50 percent of earned income up to $5000 for the first child and 25 percent, up to $2500 for each additional child. -- Phased out between $50,000 and $100,000 of earned income and/or $1,000 and $51,000 of unearned income. O Other Tax Reforms Some limitation or elimination of mortgage deductions, and state and local tax deductions would be pro-competitive. -5- SPENDING PROPOSALS Enhanced Rescission Authority/Line Item Veto According to a February 1989 Gallup poll, 70 percent of all Americans favor giving the President the power of a line-item veto. A consensus has emerged that it will be nearly impossible for the country to control spending without such power. The nation's states are way ahead of the federal government in this area -- 43 of nation's states already have the line item veto. Enhanced rescission authority would permit the President to reduce (or "zero-out") spending bills, thus providing an adding element of flexibility over the line item veto. COMPETITIVENESS PROPOSALS O Encourage Educational Choice The American people understand that education is also a competitiveness issue. They also know that education spending has increased -- in real terms by about a third over the last decade, while the number of students has remained about the same -- and yet educational performance, as measured by standardized tests such as the SAT, and by comparison with the students of other countries, continues to decline. A grassroots consensus is growing that the only way to attain true education reform is to infuse the system with competition and accountability through choice. A recent Gallup poll revealed that 63 percent of all Americans favor parental choice in public schools. Already, at least eight states have instituted choice programs. Vice President Quayle recently commented, "Nothing is more important to our nation's ability to compete than improving the education of our young people. Let me tell you -- on the competitiveness agenda, education comes first." Reform Welfare Programs Experts across the country have suggested plans to guarantee that every person in America who has a job -6- receives a package of aid that places him or her above the poverty level. Mickey Kaus, in "The Work Ethic State," proposed that every American be ensured a job, and that to be eligible for any benefits an individual must be employed. Pete Dupont propose a "Work and Family Responsibility Plan," a job-opportunity program that offers jobs to all able- bodied Americans at 90 percent of the minimum wage. And in February 1990, the Progressive Policy Institute proposed an "American Working Wage," whereby every family with an employed member would be assured non-poverty status. REFORMING POLITICS Limit Congressional Terms Calls for limiting the number of terms state and federal legislators serve have been growing in recent months. Oklahoma has recently passed such a measure on state legislative terms. Colorado and California are each addressing proposed initiatives to limit congressional terms. This sentiment matches the anti- Congress/PAC/special interest sentiment growing throughout the country. PAC Reform Ethics Diminish Litigiousness Increasingly, individual's efforts are being paralyzed by the growth of our litigious society: communities cannot attract doctors because of the enormous insurance fees doctors face, individuals' entrepreneurial projects are stifled by complicated liability requirements, and countless sums of money are consumed by our legal system facing complicated law suits. It is estimated that Americans spend $300 billion each year, directly and indirectly, to cover increased liability. This trend is particular to America, which comprises 5 percent of the world's population, yet has 60 percent of the world's lawyers. -7- Measures to diminish the litigious nature of our society include ending the deductibility of corporate legal fees and adopting the "English Rule" as part of Federal Civil procedure. ### ? MARKET CONSENSUS SURVEYS, INC. MARKET CONSENSUS 01/05/2900 03:17 Facsimile For Distribution To: ED ROGORS FROM Company: WH At fax#: 202-456-2397 Pages to follow: 5 FROM: WILL FELTUS MARKET CONSENSUS SURVEYS, INC. 7700 Leesburg Pike, Falls Church VA 22043 Telephone: 703/734-7941 Fax: 703/790-9389 MESSAGE: TO ED- THIS WHAT WE TALKED ABOUT SATURDAY. P.01 MARKET CONSENSUS SURVEYS, INC. 7700 Leesburg Pike, Falls Church VA 22043 Telephone: 703/734-7941 Facsimile: 703/790-9389 Я MEMORANDUM TO: Ed Rogers Via fax 202-456-2397 FROM: Will Feltus his DATE: October 12, 1990 Ed, enjoyed secing you at Thad's event the other night. Thus far we've contributed about $100,000 to Senate campaigns and state party federal committees. I've also spent a good deal of time talking with campaign people, AA's, etc. With only one week left in Battle of the Budget II and the election rapidly approaching, it be helpful to go on the offense. A suggested two-step pre-clection tactic: 1. The President tells this Congress to go home. If the latest Democratic Ways & Means plan runs into the least amount of trouble, the President should ask this Congress to pass a continuing resolution until the end of January, 1991, sign it and send the 101st Congress home. Let's see if the new Congress can do a better job; we already know it can't do any worse. This strategy would still leave open the possibility of a lame duck session of politically brave lawmakers but not make it necessary. 2. The President asks the country to send him a new Congress who can get the job done. After sending this Congress packing -- thus clearly affixing blame for the problem -- the President needs a new Congress he can work with. "Get me some fresh blood." The 101st Congress should be the last Congress which fails to solve our country's deficit problem. Very few voters know that the "old" Congress passes out of existence and a "new" Congress is elected to take its place. If the President could educate voters on this, it would focus the electorate's anti-incumbent energy on the "old" Democratic controlled Congress. To get the message out might require national spot buys; given the rich/poor drubbing we got on capital gains, I don't think we want to count on the so-called free media. I know the original strategy was not to nationalize the election by a theme or advertising. Unfortunately, it is becoming nationalized on it's own and advertising may be necessary to stamp our message on it. If Presidential spots are done, one third of the buy should be Mrs. Bush into the camera. 1991 Regardless of how the 1990 elections turn out, they are already being interpreted as a mandate for change. We need to make sure that those changes take place in 1991, lest voters also change their Presidential voting preferences in 1992. P.02 01 FROM 21:20 0061/50/10 Looking ahead to 1992, what ly more important than what actually h ion which is deeper than now expected, 1 tion will be determined by how politically next fall. Mid St of UnionZili not This argues for a fast start an attractive ideas both (1) solve a probl Mia was the strength of supply side economics X cut. National Dividend Act The only new idea I've heard i criteria is the National Dividend Act. supporters (see the attached testimonia an. He is a successf Florida businessman met him in 1987, when he commissioned MOR and Peter Hart to do a poll on his proposal. It was suported by a two-to-one margin (see attached). Importantly, it was somewhat more popular among independents and Democrats than among Republicans. The National Dividend Act proposes: 1. To repeal the double taxation of dividends, place a constitutional or statutory cap on income tax rates, and pay all corporate income taxes into a separate National Dividend Trust Fund. 2. Instead of being spent by Congress, all monies in the National Dividend Trust Fund would be equally distributed in quarterly dividends to every adult or registered voter - unless there was a deficit. 3. Get the budget in balance through a combination of spending freezes and taxes, and the Trust Fund will start running a surplus in just a few years. Checks could start going out during a Republican administraton. The beauty of the idea is that it rewards a balanced budget. Once voters understand they can get dividend checks worth an estimated $900 per year, a public interest group is created with clout which dwarf the special interest advocates of transfer payments and other programs. Congress wouldn't dare fail to balance the budget. The idea also has ancillary benefits. Profit becomes a good word, instead of a bad one -- when companies make more money, the dividend is bigger. It also encourages Americans to buy American. (Of course, we could certify foreign companies' which pay equivalent amounts into the fund.) I'm sure there are a half dozen MBA/CPA types at OMB who can tell you why this won't work. However, based on the poll I did, there are a 140 million Americans who will think it is a good idea. That will look like a pretty good number in a couple of years. Ed, to be frank, I could use the $900 myself. CC: Teeter, Charlie B. 20'd TO FROM 03:18 0061/50/10 THE ULTIMATE SELF INTEREST MARKET OPINION RESEARCH/PETER HART POLL TABLE 3 TABLE 2 Based on what you understand about the National Profit Sharing Now, I'd like to 80 over some of the specific provisions of the National Profit and Dividend Act, do you favor or oppose the proposal? Sharing and Dividend Act, and have you tell me if you think each one is a good idea or a bad idea? 01/85/1980 03:19 FROM Total Ren. Indep. Dem. Good Bad Don't Idea Idea Know PDIᵃ Strongly favor 22% 21% 20% 24% Just somewhat favor 34 31 35 37 In any year there is a federal deficit, money from the corporate trust fund would be used Just somewhat oppose 14 15 16 13 to pay off as much of the deficit as possible. 76% 20% 4% +56 Strongly oppose 17 20 15 14 Federal income taxes paid on corporation Don't Know 12 13 14 11 profits would be put in a trust fund at the U.S. Treasury, and kept separate from Refused/NA I I I 1 income taxes paid by individuals. 62 27 11 +35 Total 100% 100% 100% 100% Money left in the trust fund after paying the deficit would be paid out as a national profit sharing dividend. 62 32 5 +30 Collapsed: The national profit sharing dividend would Favor 56% 52% 54% 61% average as much as $900 per person each year. 61 33 6 +28 Oppose 31 35 31 28 TO The profit sharing dividend would be paid to Total 100% 100% 100% 100% all adult American citizens, 18 years or older, who are registered to vote. 56 40 3 +16 PDI +25 +17 +23 +33 The same national profit sharing dividend would be paid to all adult Americans, regardless of their income level. 53 43 4 +10 PDI-Percentage favor minus percentage oppose.) a PDI: Percentage Difference Index-% "Good idea" minus % *Bad idea." P.04 04 95 THE ULTIMATE SELF INTEREST MARKET OPINION RESEARCH/PETER HART POLL TABLE 4 TABLE 5 Based on what you've heard $0 far about the National Profit Sharing and 01/05/1988 03:19 Here are some statements others have made about the National Profit Sharing and Dividend Act, and, for each one, please tell me if you agree or disagree with Dividend Act, would you say that this proposal is a good idea which it. should be considered by Congress or a bad idea which should not be considered by Congress? Neither Agree Total Rep. Indep. Dem. FROM Nor Disagree Agree and Don't Know Disaaree PD1ª Very good idea 26% 23% 25% 31% Corporations and business Fairly good idea 38 36 36 40 leaders are very likely to oppose the National Profit 12 6 8 Sharing and Dividend Act. 78% 8% 13% +65 Fairly bad idea 9 Very bad idea 14 IT 14 12 Because Americans would want to receive a national profit sharing dividend check, members Don't know 12 13 20 8 of Congress would become much * . I I more relucient to spend more Refused/NA than the government takes in. 63 9 29 +34 If Congress is ever able to balance the federal budget, a national profit sharing dividend would help keep Suppose a candidate for Congress supported the National Profit the federal budget balanced. 61 12 28 +33 Sharing and Dividend Act -- would this give you a more favorable or less favorable impression of the candidate? TO Since Americans contribute to the profitability of corpor- ations through their consumer Total Rep. Indep. Dem. purchases, it makes good sense to let Americans share in those corporate profits. 62 8 31 +31 More favorable 52% 49% 40% 59% Instead of paying a national No difference 20 19 30 18 profit sharing dividend, it 16 would be better to Ict the Less favorable 19 23 19 U.S. government spend the Don't know 8 8 10 7 corporate income tax revenues on federal projects and * programs. 45 II +1 Refused/NA 1 1 ** 44 The National Profit Sharing and Dividend Act is just another government giveaway program. 36 12 52 -16 P.05 97 96 "As a co-sponsor of the National Dividend Act, I assure you that I will continue to urge my colleagues to consider the merits of this legislation." Carrol A. Campbell, Jr. Member of Congress A FEW COMMENTS ON MR. PERRY'S PLAN "I believe this proposed legislation has a great deal of merit, and I "A daring plan to preserve the free enterprise system and reverse the hope that the House Ways and Means Committee will consider it trend toward national bankruptcy brought on by yearly federal carefully in the weeks ahead." 01/05/1900 03:20 budget deficits has been developed and should be implemented. Howard H. Baker, Jr. Congress won't accept the National Dividend Plan and members United States Senate will not until they get pressure from the grassroots." Dr. Martin R. Gainsbrugh "It's a great idea." FROM Former Chief Economist Stanley J. Modic, Editor The Conference Board Industry Week "THE NATIONAL DIVIDEND PLAN is more complex than the "The logic is irresistible, and presents our lawmakers with a idea of a balanced-budget amendment, which is inching its way to plausible structure for a truly popular economy." national consideration. Yet it holds the hope of achieving far more widely shared goals." Editorial The Patriot-News Co. Thomas Gephardt, Associate Editor Harrisburg, Pennsylvania Cincinnati Enquirer "I want to assure you of my continuing strong support for this "As deficits continue to mount, this would be a good time for legislation, and of my efforts to see that it does receive favorable Congress to seriously consider a revolutionary plan to refinance the action." country. Some profound economic minds that have studied the TO concept-have become converts." Guy Vander Jagt Member of Congress Editorial The Sacramento Union "I think your success to date is evidence of your devotion to the issue and we will watch with interest action on this legislation over the "I can't tell you how much I admire your steadfastness. The next several months." compelling logic of your case (and the interesting trade-offs you've developed). Too bad there aren't more great Americans like you to Donald L. Calvin carry the ball." Executive Vice President New York Stock Exchange William E. Simon Former Secretary of the Treasury 4 5 P.06 THE WHITE HOUSE WASHINGTON October 18, 1990 THE CHIEF of STAFF has seen MEMORANDUM FOR GOVERNOR SUNUNU FROM: EDE HOLIDAY MA SUBJECT: Summary of Fall 1990 Issues Assessment Project I. OVERVIEW During the past few weeks, the Office of Cabinet Affairs worked with the Cabinet and key agency heads on a project to assess their Fall agendas and to integrate their plans with the four key domestic policy themes the President discussed at the September 17 Cabinet meeting. This project has three elements: 1. Written reports. In September, we solicited a report on the key activities, initiatives and problems of each department (save State and Defense) and the key agencies for September through December. These very detailed reports -- some 350 pages total -- were assembled and distributed among White House staff. 2. Departmental meetings. Using the reports as a guide, we conducted a series of meetings attended by senior management staff from each department or agency and a core group of individuals from the White House (including Cabinet Affairs, OMB, Press and the Offices of Policy Development and Communications). The meetings were held both to review the long-range reports and help frame a common understanding of the principles and themes that undergird the Administration's domestic policy. Part II of this memo elaborates on those meetings. 3. Follow-up. This project has greatly improved our understanding of what to expect from the departments and agencies in the coming months. Part III of this memo contains a summary of the key items still pending. Because our meetings revealed a number of issues that seem to require interdepartmental coordination, White House guidance or policy review, this memorandum makes a number of recommendations for appropriate follow-up to the Fall assessment. II. THE DEPARTMENTAL MEETINGS The series of departmental meetings was conducted over three weeks and had two basic purposes. 2 First, the meetings allowed a thorough review of each department's written report -- a modified and significantly expanded version of the weekly Cabinet Report. In each case we reviewed the department's highest priorities for the September through December period. On the whole, these management reviews were extremely valuable. In discussing the reports, numerous other long-range projects and general concerns were ventilated. Already we have identified and reconciled perhaps two dozen significant issues that came up in the Fall assessment. We have distributed information about various problems or initiatives described in the reports to affected White House offices. Other issues require further work or review, as described in the department-by-department entries. Second, the meetings were organized to cement a common understanding about the basic elements of Administration domestic policy and to develop a common rhetorical currency to explain our domestic policy. We encouraged a vigorous exchange of views between White House and departmental staff -- typically a department was represented by the Deputy Secretary, the chief of staff and the senior public affairs officer -- on the themes common to so much of the Administration's domestic policy. We encouraged each department, when possible, to frame its priorities in light of what the President identified at the September 17 Cabinet meeting as the four key domestic themes he will continue to stress in the coming months: 1. an anti-recession/growth agenda that continues regulatory restraint and combats protectionism. 2. education, empowerment and "kinder-gentler" issues, such as the importance of public service. 3. crime and drugs. 4. energy and the environment. Because this initial agenda assessment exercise proved helpful to us, I propose to conduct this agenda assessment with the departments and agencies on a regular basis, once every four months. We will ask for modifications in the written reports and will conduct the follow-up meetings somewhat differently and more quickly. It is, however, a management effort that is well worth making routine. III. ON THE HORIZON AT THE DEPARTMENTS A department-by-department review of key issues follows. The brief entries are not intended as an exhaustive treatment of any 3 single item, but as a handy summary of pending matters. In cases where it appears that follow-up is desirable, we have made recommendations. Although the President's summary of his four broad domestic agenda themes was delivered after the departmental reports had been submitted, his four themes clearly permeate the domestic policy agenda of the departments. Our summary of pending issues underscores this fact by aggregating the entries, where possible, into categories defined by the four themes. Also attached is a brief index to our summary of the pending departmental issues. 4 INDEX OF DEPARTMENTAL SUMMARIES I. Anti-recession/Growth Issues Implement a Market-Oriented Farm Bill (Agriculture). Complete Uruguay Round Negotiations (Agriculture). Complete the Canadian Open Border Agreement (Agriculture). Prioritize and Target International Trade Promotion (Commerce). Increase Focus on Private Sector Issues (Commerce). Expand Research and Development and Commercialization Activities of National Laboratories (Energy). Develop Energy Conservation and Production Measures (Energy). Continue Development of Superconducting Supercollider (Energy). Complete National Energy Strategy (Energy). Pass the President's HOPE Legislation (HUD). Establish an Agenda for Economic Empowerment (HUD). Promote Deregulation of the Urban Housing Market (HUD). Promote a Renewal of Urban Neighborhoods (HUD). Develop Coherent, Balanced Western Water Policy (Interior). Consider Long-Term Analysis of Endangered Species Act (Interior). Support Energy Production Measures (Interior). Determine Strategy on Civil Rights Bill (Justice). Restore the Minimum Wage Small Business Exemption (Labor). Expand International Cooperation on Labor Issues (Labor). Liberalize International Air Cargo Markets (Transportation). Review Aviation Noise Policy (Transportation). Consider National Maritime Policy (Transportation). Pass President's Enterprise for the Americas Initiative (Treasury). Complete the Comprehensive Study of the Federal Deposit Insurance System (Treasury). Promote the Brady Plan (Treasury). Complete Uruguay Round Negotiations (USTR). Pass President's Enterprise for the Americas Initiative (USTR). Complete Negotiations of Bilateral Agreements with Eastern European Countries (USTR). Emphasize Comparative Risk-Based Scientific Approach to Environmental Protection (EPA). Develop Pollution Prevention and Recycling Initiatives (EPA). II. Education, Empowerment and Kinder-Gentler Issues Protect Animal Welfare (Agriculture). Measure Progress Toward the National Education Goals (Education). 5 Promote Choice in Education (Education). Reduce Student Loan Defaults (Education). Sustain the Principles of the Education Excellence Act (Education). Improve Hispanic Education (Education). Promote Educational Excellence Abroad (Education). Commission on Drug Free Schools (Education). Pursue Outreach Programs in Math/Science Education (Energy). Continue Development of Superconducting Supercollider (Energy). Stimulate National Discussion on Health Care (HHS). Promote Health Abroad (HHS). Focus on Minority Health Issues (HHS). Address Refugee Resettlement Problem (HHS). Pass the President's HOPE Legislation (HUD). Establish an Agenda for Economic Empowerment (HUD). Provide Fair Housing Access for the Handicapped (HUD). Link Services for the Poor (HUD). Reorganize Responsibilities for Indian Affairs (Interior). Celebrate Anniversary of National Park System (Interior). Determine Strategy on Civil Rights Bill (Justice). Obtain Passage of Job Training Partnership Act Amendments (Labor). Issue the Final Report of the Coal Commission (Labor). Expand Dole's Mentoring Initiative (Labor). Complete Glass Ceiling Initiative Review (Labor). Restore the Minimum Wage Small Business Exemption (Labor). Complete Departmental Management Review (Transportation). Study Future Structure of Veterans Health Care (VA). Eliminate Interdepartmental Redundancies (VA). Highlight Importance of Environmental Education (EPA). Celebrate Elevation of EPA to Cabinet Status and Its 20th Anniversary (EPA). III. Crime and Drug Issues Submit Report of Commission on Drug Free Schools (Education). Reorganize Responsibilities for Indian Affairs (Interior). Pass the Crime Bill (Justice). Initiate Drunk Driving Ad Campaign (Transportation). Develop and Implement the President's Annual Drug Control Strategy (ONDCP). Release National Household Survey (ONDCP). Highlight Local Efforts Against Drugs (ONDCP). Highlight State Efforts Against Drugs (ONDCP). 6 IV. Energy and the Environment Issues Protection of the Spotted Owl (Agriculture). Complete National Energy Strategy (Energy). Develop Energy Conservation and Production Measures (Energy). Initiate Environmental Restoration and Waste Management Programs (Energy). Present the Facts on the Problem of Lead-Based Paint (HUD). Develop Coherent, Balanced Western Water Policy (Interior). Celebrate Anniversary of National Park System (Interior). Designate New Wilderness Areas (Interior). Support Energy Production Measures (Interior). Participate in Development of Wetlands Policy (Interior). Consider Long-Term Analysis of Endangered Species Act (Interior). Support Energy Conservation Measures (Transportation). Emphasize Comparative Risk-Based Scientific Approach to Environmental Protection (EPA). Pursue Analysis of Environmental Problems Across Various Media (EPA). Pass and Implement Clean Air Act Amendments (EPA). Develop Administration Position for Resource Conservation and Recovery Act Reauthorization (EPA). Develop Pollution Prevention and Recycling Initiatives (EPA). Assess Superfund Program (EPA). Highlight Importance of Environmental Education (EPA). Prepare National Strategy for Groundwater Protection (EPA). Celebrate Elevation of EPA to Cabinet Status and Its 20th Anniversary (EPA). Release and Discuss Report on Carcinogenic Effects of Electromagnetic Fields (EPA). V. Other Issues Preempt State Regulation of Electric Utilities (Agriculture). Complete the 1990 Census (Commerce). Complete Study of Nuclear Weapons Reconfiguration (Energy). Respond to Court Ruling on Child Disability Benefits (HHS). Submit Nomination for the Director of NIH (HHS). Release Cost of Raising Children Report (HHS). Pass Debt Collection Legislation (Justice). Monitor Pending Court Cases (Justice). Improve Aviation Security (Transportation). Reauthorize Surface Transportation Legislation (Transportation). Complete IRS Regulations for the Presidential Election Campaign Fund (Treasury). Undertake IRS Modernization (Treasury). Václav Havel Address to the United States Congress, February 1990 We've chosen to end our book with the complete text of the address given on February 22, 1990 by Václav Havel, now the president of Czechoslovakia, to a joint session of the United States Congress. In this eloquent speech, Mr. Havel has once again best expressed the intelligence, decency, courage, and hope for the future that have characterized the revolution he and others have led in Central Europe. My advisers advised me to speak on this important occasion in Czech. I don't know why. Perhaps they wanted you to enjoy the sweet sounds of my mother tongue. The last time they arrested me, on October 27 of last year, I didn't know whether it was for two days or two years. Exactly one month later, when the rock musician Michael Kocab told me that I would probably be proposed as a presiden- tial candidate, I thought it was one of his usual jokes. On December 10, 1989, when my actor friend Jiri Bartoska, in the name of the Civic Forum, nominated me as a candidate for president of the republic, I thought it was out of the question that the parliament we had inherited from the previous regime would elect me. Nineteen days later, when I was unanimously elected presi- dent of my country, I had no idea that in two months I would be speaking before this famous and powerful assembly and that what I would say would be heard by millions of people who had 485 486 Václav Havel Address to the United States Congress, February 1990 487 never heard of me and that hundreds of politicians and political sion - among other things-provided significant help to us scientists would study every word I said. Czechs and Slovaks. When they arrested me on October 27, I was living in a Thanks to the great support of your president, Wilson, our country ruled by the most conservative Communist government first president, Tomás Garrigue Masaryk, was able to found our in Europe, and our society slumbered beneath the pall of a modern independent state. He founded it, as you know, on the totalitarian system. Today, less than four months later, I am same principles on which the United States of America was speaking to you as the representative of a country that has set out founded, as Masaryk's manuscripts held by the Library of Con- on the road to democracy, a country where there is complete gress testify. freedom of speech, that is getting ready for free elections, and In the meantime, the United States made enormous strides. It that wants to create a prosperous market economy and its own became the most powerful nation on Earth, and it understood foreign policy. the responsibility that flowed from this. Proof of this are the It is all very extraordinary. hundreds of thousands of your young citizens who gave their But I have not come here to speak for myself or about my lives for the liberation of Europe and the graves of American feelings or merely to talk about my own country. I have used this airmen and soldiers on Czechoslovak soil. small example of something I know well to illustrate something But something else was happening as well: the Soviet Union general and important. appeared, grew, and transformed the enormous sacrifices of its We are living in very extraordinary times. The human face of people suffering under totalitarian rule into a strength that, after the world is changing so rapidly that none of the familiar World War II, made it the second most powerful nation in the political speedometers are adequate. world. It was a country that rightly gave people nightmares, We playwrights, who have to cram a whole human life or an because no one knew what would occur to its rulers next and entire historical era in a two-hour play, can scarcely understand what country they would decide to conquer and drag into their this rapidity ourselves. And if it gives us trouble, think of the "sphere of influence," as it is called in political language. trouble it must give political scientists, who spend their whole All of this taught us to see the world in bipolar terms, as two lives studying the realm of the probable and have even less enormous forces, one a defender of freedom, the other a source experience with the realm of the improbable than we play- of nightmares. Europe became the point of friction between wrights. these two powers, and thus it turned into a single enormous Let me try to explain why I think the velocity of the changes in arsenal divided into two parts. In this process, one half of the my country, in Central and Eastern Europe, and of course in the arsenal became part of that nightmarish power, while the other- Soviet Union itself, has made such a significant impression on the free part bordering on the ocean and having no wish to be the face of the world today, and why it concerns the fate of us all, driven into it, was compelled, together with you, to build a including you Americans. I would like to look at this first from system to which we probably owe the fact that we still exist. the political point of view and then from a point of view that we So you may have contributed to the salvation of us Europeans, might call philosophical. of the world, and thus of yourselves for a third time: you have Twice in this century the world has been threatened by helped us survive until today without a hot war this time but catastrophe; twice this catastrophe was born in Europe; and twice merely a cold one. you Americans, along with others, were called upon to save And now what is happening is happening: the totalitarian Europe, the whole world, and yourselves. The first rescue mis- system in the Soviet Union and in most of its satellites is 488 Václav Havel Address to the United States Congress, February 1990 489 breaking down, and our nations are looking for a way to democ- racy and independence. The first act in this remarkable drama or not, we are located in the very heart of Europe, and, thanks to began when Mr. Gorbachev and those around him who were this, we have no view of the sea and no real navy. I mention this faced with the sad reality of their country initiated their policy of because political stability in our country has traditionally been perestroika. Obviously they had no idea either what they were important for the whole of Europe. This is still true today. Our setting in motion or how rapidly events would unfold. We knew Government of National Understanding, our present Federal a lot about the enormous number of growing problems that Assembly, the other bodies of the state, and I myself will person- slumbered beneath the honeyed, unchanging mask of socialism. ally guarantee this stability until we hold free elections, planned But I don't think any of us knew how little it would take for these for June. We understand the terribly complex reasons, domestic problems to manifest themselves in all their enormity and for the political reasons above all, why the Soviet Union cannot with- longings of these nations to emerge in all their strength. The draw its troops from our territory as quickly as they arrived in mask fell away so rapidly that, in the flood of work, we have 1968. We understand that the arsenals built there over the past literally no time to be astonished. twenty years cannot be dismantled and removed overnight. Nev- What does this all mean for the world in the long run? ertheless, in our bilateral negotiations with the Soviet Union, we Obviously a number of things. This is, I am firmly convinced, a would like to have as many Soviet units as possible moved out of historically irreversible process, and as a result Europe will begin our country before the elections, in the interest of political again to seek its own identity without being compelled to be a stability. The more successful our negotiations, the more those divided armory any longer. Perhaps this will create the hope that who are elected in our places will be able to guarantee political sooner or later your boys will no longer have to stand on guard stability in our country even after the elections. for freedom in Europe, or come to our rescue, because Europe Second, I often hear the question: How can the United States will at last be able to stand guard over itself But that is still not of America help us today? My reply is as paradoxical as the whole the most important thing: the main thing is, it seems to me, that of my life has been: You can help us most of all if you help the these revolutionary changes will enable us to escape from the Soviet Union on its irreversible, but immensely complicated, rather antiquated straitjacket of this bipolar view of the world road to democracy. It is far more complicated than the road open and to enter at last into an era of multipolarity. That is, into an era to its former European satellites. You yourselves know best how in which all of us - large and small, former slaves and former to support, as rapidly as possible, the nonviolent evolution of this masters - will be able to create what your great President Lin- enormous, multinational body politic toward democracy and coln called "the family of man." Can you imagine what a relief autonomy for all of its peoples. Therefore, it is not fitting for me this would be to that part of the world that for some reason is to offer you any advice. I can only say that the sooner, the more called the Third World, even though it is the largest? quickly, and the more peacefully the Soviet Union begins to I don't think it's appropriate simply to generalize, so let me be move along the road toward genuine political pluralism, respect specific: for the rights of nations to their own integrity and to a working First, as you certainly know, most of the big wars and other that is a market economy, the better it will be, not just for the conflagrations over the centuries have traditionally begun and Czechs and Slovaks, but for the whole world. And the sooner ended on the territory of modern Czechoslovakia, or were some- you yourselves will be able to reduce the burden of the military how related to that area. Let the Second World War stand as the budget borne by the American people. To put it metaphorically, most recent example. This is understandable: whether we like it the millions you give to the East today will soon return to you in the form of billions in savings. 490 Václav Havel Address to the United States Congress, February 1990 491 Third, it is not true that the Czech writer Václav Havel wishes Fifth, naturally we welcome the initiative of President Bush, to dissolve the Warsaw Pact tomorrow and then NATO the day which was essentially accepted by Mr. Gorbachev as well, accord- after that, as some eager journalists have written. Václav Havel ing to which the number of American and Soviet troops in merely thinks what he has said here, that for another hundred Europe should be radically reduced. It is a magnificent shot in years, American soldiers shouldn't have to be separated from the arm for the Vienna disarmament talks and creates favorable their mothers just because Europe is incapable of being a guaran- conditions not only for our own efforts to achieve the quickest tor of world peace, which it ought to be, in order to make some possible departure of Soviet troops from Czechoslovakia but also amends, at least, for having given the world two world wars. indirectly for our own intention to make considerable cuts in the Sooner or later Europe must recover and come into its own and Czechoslovak army, which is disproportionately large in relation decide for itself how many of whose soldiers it needs, so that its to our population. If Czechoslovakia were forced to defend itself own security and all the wider implications of that security may against anyone, which we hope will not happen, then it would be radiate peace into the whole world. Václav Havel cannot make capable of doing so with a considerably smaller army, because decisions about things that are not proper for him to decide. He this time - after not just decades but centuries - its defense is merely putting in a good word for genuine peace, and for would be supported by the common and indivisible will of both achieving it quickly. its peoples and its leadership. Our freedom, our independence, Fourth, Czechoslovakia thinks that the planned summit con- and our newborn democracy have been purchased at great cost, ference of countries participating in the Helsinki process should and we shall not surrender them. For the sake of order, I should take place soon and that, in addition to what it wants to accom- add that whatever steps we take are not intended to complicate plish, it should aim to hold the so-called Helsinki II conference the Vienna disarmament talks but, on the contrary, to facilitate earlier than 1992, as originally planned. Above all, we feel it could them. be far more significant than seemed possible before. We think Sixth, Czechoslovakia is returning to Europe. In the general that Helsinki II should become something equivalent to the interest and its own interest as well, it wants to coordinate this European peace conference that has not yet been held - one that return - both politically and economically - with the other would finally put a formal end to the Second World War and all returnees, which means, above all, with its neighbors the Poles its unhappy consequences. Such a conference would officially and the Hungarians. We are doing what we can to coordinate bring a future democratic Germany, in the process of unifying these returns. And at the same time, we are doing what we can so itself, into a new pan-European structure that could decide about that Europe will be capable of really accepting us, its wayward its own security system. This system would naturally require children. Which means that it may open itself to us and may some connection with that part of the globe we might label the begin to transform its structures - which are formally European "Helsinki" part, stretching westward from Vladivostok all the but de facto Western European - in that direction, but in such a way to Alaska. The borders of the European states, which, by the way that it will not be to its detriment but rather to its advantage. way, should become gradually less important, should finally be Seventh, I have already said this in our parliament, and I guaranteed legally by a common, regular treaty. It should be would like to repeat it here in this Congress, which is architec- more than obvious that the basis for such a treaty would have to turally far more attractive: for many years, Czechoslovakia as be general respect for human rights, genuine political pluralism, someone's meaningless satellite - has refused to face up honestly and genuinely free elections. to its coresponsibility for the world. It has a lot to make up for. If I dwell on this and so many important things, it is only because I 492 Václav Havel Address to the United States Congress, February 1990 493 feel - along with my fellow citizens - a sense of culpability for At the same time, unintentionally, of course, it has given us our former reprehensible passivity and a rather ordinary sense of something positive: a special capacity to look, from time to time, indebtedness. somewhat further than someone who has not undergone this Eighth, we are of course delighted that your country is so bitter experience. A person who cannot move and live a some- readily lending its support to our fresh efforts to renew democ- what normal life because he is pinned under a boulder has more racy. Both our peoples were deeply moved by the generous offers time to think about his hopes than someone who is not trapped made a few days ago in Prague at the Charles University, one of that way. the oldest in Europe, by your secretary of state, Mr. James Baker. What I am trying to say is this: we must all learn many things We are ready to sit down and talk about them. from you, from how to educate our offspring and how to elect Ladies and gentlemen, I have been president for only two our representatives all the way to how to organize our economic months and I haven't attended any schools for presidents. My life so that it will lead to prosperity and not to poverty. But it only school was life itself Therefore I don't want to burden you doesn't have to be merely assistance from the well educated, the any longer with my political thoughts, but instead I will move on powerful, and the wealthy to someone who has nothing and to an area that is more familiar to me, to what I would call the therefore has nothing to offer in return. philosophical aspect of those changes that still concern everyone, We too can offer something to you: our experience and the although they are taking place in our corner of the world. knowledge that has come from it. As long as people are people, democracy in the full sense of the This is a subject for books, many of which have already been word will always be no more than an ideal; one may approach it written and many of which have yet to be written. I shall as one would a horizon, in ways that may be better or worse, but therefore limit myself to a single idea. it can never be fully attained. In this sense you too are merely approaching democracy. You have thousands of problems of all The specific experience I'm talking about has given me one kinds, as other countries do. But you have one great advantage: great certainty: Consciousness precedes Being, and not the other way around, as Marxists claim. you have been approaching democracy uninterruptedly for more For this reason, the salvation of this human world lies than 200 years, and your journey toward the horizon has never been disrupted by a totalitarian system. Czechs and Slovaks, nowhere else than in the human heart, in the human power to despite their humanistic traditions that go back to the first reflect, in human meekness, and in human responsibility. millennium, have approached democracy for a mere twenty Without a global revolution in the sphere of human con- years, between the two world wars, and now for the 3½ months sciousness, nothing will change for the better in the sphere of since November 17 of last year. our Being as humans; and the catastrophe toward which this The advantage that you have over us is obvious at once. world is headed, be it ecological, social, demographic, or a general breakdown of civilization, will be unavoidable. If we are The Communist type of totalitarian system has left both our nations, Czechs and Slovaks - as it has all the nations of the no longer threatened by world war, or by the danger that the Soviet Union and the other countries the Soviet Union subju- absurd mountains of accumulated nuclear weapons might blow gated in its time - a legacy of countless dead, an infinite spec- up the world, this does not mean that we have definitively won. We are in fact far from the final victory. trum of human suffering, profound economic decline, and above We are still a long way from that "family of man"; in fact, we all enormous human humiliation. It has brought us horrors that fortunately you have not known. seem to be receding from the ideal rather than drawing closer to it. Interests of all kinds - personal, selfish, state, national, group, 494 Václav Havel Address to the United States Congress, February 1990 495 and, if you like, company interests - still considerably outweigh It is easy to have independence in your program and then leave genuinely common and global interests. We are still under the others to carry that program out. If everyone thought that way, sway of the destructive and vain belief that man is the pinnacle of pretty soon no one would be independent. creation, not just a part of it, and that therefore everything is I think that you Americans should understand this way of permitted. There are still many who say they are concerned not thinking. Wasn't it the best minds of your country, people you for themselves but for the cause, while they are demonstrably out could call intellectuals, who wrote your famous Declaration of for themselves and not for the cause at all. We are still destroying Independence, your Bill of Rights, and your Constitution and the planet that was entrusted to us and its environment. We still who - above all - took upon themselves the practical respon- close our eyes to the growing social, ethnic, and cultural conflicts sibility for putting them into practice? The worker from Branik in the world. From time to time we say that the anonymous in Prague that your president referred to in his State of the megamachinery we have created for ourselves no longer serves Union message this year is far from being the only person in us, but rather has enslaved us, yet we still fail to do anything Czechoslovakia, let alone in the world, to be inspired by those about it. great documents. They inspire us all. They inspire us despite In other words, we still don't know how to put morality ahead the fact that they are over 200 years old. They inspire us to be of politics, science, and economics. We are still incapable of citizens. understanding that the only genuine backbone of all our When Thomas Jefferson wrote, "Governments are instituted actions if they are to be moral - is responsibility. Responsibility among Men deriving their just Powers from the Consent of the to something higher than my family, my country, my company, Governed," it was a simple and important act of the human my success. Responsibility to the order of Being, where all our spirit. actions are indelibly recorded, and where, and only where, they What gave meaning to that act, however, was the fact that the will be properly judged. author backed it up with his life. It was not just his words, it was The interpreter or mediator between us and this higher his deeds as well. authority is what is traditionally referred to as human conscience. I will end where I began: history has accelerated. I believe that, If I subordinate my political behavior to this imperative medi- once again, it will be the human mind that will notice this ated to me by my conscience, I can't go far wrong. If on the acceleration, give it a name, and transform those words into contrary I were not guided by this voice, not even ten presidential deeds. schools with 2,000 of the best political scientists in the world could help me. This is why I ultimately decided - after resisting for a long time - to accept the burden of political responsibility. I am not the first, nor will I be the last, intellectual to do this. On the contrary, my feeling is that there will be more and more of them all the time. If the hope of the world lies in human consciousness, then it is obvious that intellectuals cannot go on forever avoiding their share of responsibility for the world and hiding their distaste for politics under an alleged need to be independent.