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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:
Speechwriting, White House Office of
Series:
Speech File Draft Files
Subseries:
Chron File, 1989-1993
OA/ID Number:
13479
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13479-007
Folder Title:
Electronic Industries Association, 3/15/89 [1]
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25
6
1
6
015848
Document No.
WHITE HOUSE STAFFING MEMORANDUM
DATE:
3/14/89
ACTION/CONCURRENCE/COMMENT DUE BY:
PRESIDENTIAL REMARKS: ELECTRONIC INDUSTRIES ASSOCIATION
SUBJECT:
ACTION FYI
ACTION FYI
VICE PRESIDENT
MCCLURE
SUNUNU
NEWMAN
SCOWCROFT
PORTER
DARMAN
STUDDERT
BATES
UNTERMEYER
ROGERS
BREEDEN
CARD
WINSTON
CICCONI
PINKERTON
DEMAREST
GRAHAM
FITZWATER
GRAY
HAGIN
REMARKS:
The attached has been forwarded to the President.
RESPONSE:
James W. Cicconi
Assistant to the President
and Deputy to the Chief of Staff
Ext. 2702
(Smith)
March 14, 1989
noon
REMARKS: ELECTRONIC INDUSTRIES ASSOCIATION
1938
MAR
J.W. MARRIOTT HOTEL
MARCH 15, 1989
2
Chairman Little, President McCloskey, members of the
Electronic Industries Association, honored guests, ladies and
gentlemen.
Thank you for that generous introduction, and for the warmth
of your reception.
Bishop Fulton Sheen once said, "The proud man counts his
newspaper clippings -- the humble man counts his blessings."
Well, I am proud indeed to address this bi-annual dinner. But
let me confess: tonight, flanked by colleagues and old friends,
I am more grateful for my blessings.
Let me first congratulate this year's EIA Medal of Honor
recipient, my friend Sidney Topol (TOE-pull). And I want also to
say a word about this organization, the oldest and largest
exploring the new horizons of America's technological future.
Today, nearly two million Americans work in the electronics
industry. You are leading America's newest industrial
revolution. And you're helping us outwork and outperform any
competitor in the world.
2
Tonight we meet as neighbors, and as fellow businessmen.
Our goal is a fairer, more productive, and ennobling life, not
merely in our time, but for generations to come.
A more ennobling life can mean many things. It means
education and opportunity. It means a nation of responsive
citizens -- not only willing but eager to share. And it means
the economic development which makes that sharing possible. For
prosperity depends on growth, and growth depends on freedom.
My friends, the freedom to dare, to risk, and defy the odds
forms the heart of free enterprise, just as free enterprise is
central to the American Dream.
Freedom can give our children a better land than we
ourselves inherited. But to preserve it, we must protect it.
That is why I have proposed four objectives to build a better
America: first, reduce the deficit; second, invest in America's
future; third, address the problems of the present -- the
problems that cannot wait; and, last but not least, no new taxes.
Yes, America faces immediate problems -- problems like ocean
dumping, the homeless, illiteracy. And yes, I pledge to you: we
will address them now -- not somewhere down the line. But as we
do, let us move beyond the immediate. For, today, America is
prosperous and at peace. Indeed, some might say that for the
first time in decades we face no major crises, foreign or
3
domestic. To be sure, there are challenges -- and many
opportunities presented by changes that are favorable to
democracy, to liberty, to free markets -- favorable to the
principles this country has always stood for.
Therefore, let us recognize that we stand at a special
moment in our history. It is a moment
not for complacency
not to sit back and reflect upon what has been
but to
reflect upon what might be. It is an opportunity to assess the
many changes occurring both at home and abroad, to look into the
future and plan for it so that America's place, and the
well-being of her people, are ensured for generations to come.
Our nation has always had a special faith in the future, and the
hopes and dreams that might be realized. Throughout our history,
our ancestors had the wisdom to invest in that future, whether it
was the founding of great universities or tying together the
continent by rail or building the Interstate highway system. We
must remember that American tradition as we plan our investments
for the future of our own children.
My four objectives will allow America to honor that
heritage, and seize her moment. Together, they will solidify
economic freedom. Together, they will expand that freedom. But
above all, they will empower more people, more fully, to partake
of the American Dream.
4
Reducing the deficit will free our children from interest
debt which haunts their future. Investing in that future will
prepare us as a people for a new century and its challenges.
Focusing on urgent priorities will free government to marshal its
resources. And no new taxes reflects that innately American
quality -- good old-fashioned common sense.
These four objectives will build on the progress of the last
eight years -- they will build a better America. They will
reaffirm our strengths, defuse ticking time-bombs, and re-orient
us as a nation. Above all, they form a new approach which looks
to tomorrow, not today.
As President, I am committed to this new approach. That is
why, last month, I proposed an agenda to cut the Federal deficit,
help ensure our financial future, and, thus, enhance business'
ability to plan, expand, and build. And I proposed to cut that
deficit not by increasing America's taxes, but by controlling
spending and enlarging the American Pie.
My friends, next year alone, thanks to economic growth,
Federal tax revenues will rise by more than $80 billion -- yes,
more than $80 billion, even with no new taxes.
My plan will use that new revenue to slash the Federal
deficit by more than 40 percent, bringing the deficit below the
target mandated by Gramm-Rudman-Hollings.
5
As you know, we have begun the budget process. The
Administration has acted; now, it is up to the Congress to
respond. Our task is to keep the momentum going, and growing.
Only then can we create the investment so crucial to America: to
increase new jobs; to unlock new markets; and, yes, to unleash
new technologies.
In a sense, this is typically American. For we are
restless, never satisfied: We look to next week, next year, not
to the year 2000.
Government's role -- its challenge -- is to harness that
ambition by looking beyond today. Last year, a large survey of
CEOs revealed that while American business leaders are inherently
optimistic, they believe -- in this poll, by nine to one -- that
we are too short-term oriented. My plan speaks to the long-term,
and to a stable business climate. It says that to remain
competitive, we must look beyond the next quarterly statement.
It says "Yes" to America's standard of living, and to her future
standing in the world.
For instance, let me address the investment that will result
from cutting the maximum rate on capital gains. My plan supports
reducing it to 15 per cent on long-held assets. Moreover, it
effectively eliminates the capital gains tax on people making
less than $20,000 a year.
6
In 1978, this organization, following the leadership of
Congressman Bill Steiger, worked to reduce the capital gains tax.
Well, today, we must fight that battle again. My friends, a
destructively high tax is like playing the World Series with an
eight-man team. But restoring the capital gains differential
will lift revenues, help savings, and free American businesses,
without distorting world markets.
Consider, on the one hand, those competitors who tax capital
gains punitively. By punishing risk-takers, they stifle
opportunity. Less opportunity means less capital to invest.
Less capital, in turn, makes countries less competitive. It's a
vicious cycle, a Catch-22, and above all, an economic dead-end.
On the other hand, keep in mind that the economies of the
Pacific Rim -- the "four dragons" of Hong Kong, Singapore,
Taiwan, and the Republic of Korea -- exempt capital gains from
taxes; and our second-biggest trading partner, Japan, scarcely
taxed them during her meteoric rise.
As businessmen, you know this economic history. You know
its lessons are clear. And, like me, you hear a lot about
competitiveness these days. Well, nothing can make America more
competitive than restoring the capital gains differential.
America's entrepreneurs should not have to run an uphill race
against the rest of the world.
7
Tonight, I challenge the Congress to join with me and level
that playing field. I ask it to expand the marketplace and
assist development. I urge it to increase competitiveness and
link reward and risk. How? By lowering the tax rate on capital
gains.
My friends, the Treasury estimates that this cut will add
$4.8 billion to the revenue side of the ledger in Fiscal Year
1990. Let us use it to expand economic freedom, and help people
help themselves. And let us build upon the over 19 and 1/2
million new jobs created in this country since December 1982 --
five times the number created in Japan.
Accordingly, my plan to build a better America recommends a
permanent extension of the Research and Experimentation tax
credit. It will increase domestic research by multinationals,
and end the uncertainty of expiring temporary rules. And by
adopting Federal Enterprise Zones, it will help those untouched
by the economic recovery.
Enterprise Zones are a pioneering initiative to create a
number of Federally-targeted zones -- or areas -- in
economically-distressed communities. By providing tax breaks and
relief from regulation, these zones foster a climate where
businesses are founded, and existing businesses expanded.
8
Enterprise Zones, like lowering the tax on capital gains,
will invest in America's future. And so will other investments:
investments, for instance, in education, in the environment, in
our children, and in space.
As a Texan, I know, first-hand, the role of space
exploration. I know of your industries' involvement, and your
role in its success. My plan allocates an increase of $2.4
billion for the Space Program. This is as much an investment in
our technological future as it is a reaffirmation of our national
character. It supports affordable access to space through the
National Aero-Space Plane program and nine Space Shuttle flights
by 1990. It funds Space Station Freedom, planned for operation
in the mid-1990s. I also want to elevate the status of the
President's Science Advisor.
All the unexplored frontiers are not in space; many are
found closer to home as we seek to push back the frontiers of
human knowledge. Toward that end, let us invest in the
Superconducting Super Collider -- a bold new experiment, fusing
science, technology, and education. Let us expand the work which
will leverage America's technological prowess in such areas as
micro-computers, automative electronics, bio-processing, and
high-definition TV. And because science is critical, as I have
said, I intend to double the National Science Foundation budget.
9
These investments are not some river-boat gamble in a
distant future, but a steadfast way to ensure the future. And,
yet, my friends, remember: that future will depend, above all, on
our most precious resource, America's children.
We must make sure that our children are educated -- the very
definition of long-term investment in America's future. That is
why I want Congress to create a $500 million program to reward
America's "merit schools." I intend to create special
Presidential awards in every state. And I urge expanded use of
magnet schools -- giving parents and students the freedom of
choice. I propose a program to spur "alternative certification"
-- allowing talented Americans from every field, especially
science and mathematics, to teach in America's classrooms. And
through a new program of National Science Scholars, I want to
give America's youth a special incentive to excel in math and
science.
To build a better America, my program also mobilizes
resources to teach our children the truth about the dangers of
drugs. And we have proposed the YES Program -- or Youth Entering
Service -- to involve our kids in their communities.
My friends, our children can make the twenty-first century a
new American Century. So let us help them, guide them. And let
us understand that we are one community -- proud, united, and
unafraid of the future.
10
I found that out in Texas, after Barbara and I packed our
belongings, moved halfway across the country, and founded an oil
company with 250 workers.
It was there that I learned about the people, problems, and
priorities of industry. I made right decisions, and wrong ones.
And I learned how our fate is not divisible: That to build a
company, like to head a family, we must give of, not merely to,
ourselves.
The business of America isn't only business. The business
of business is America.
Albert Einstein said, "Everything that is really great and
inspiring is created by individuals who labor in freedom."
For more than 200 years, Americans have invested their
labor, their talent, their compassion, and their vision to
preserve freedom, to seize the moment, and sustain our way of
life. I ask you: With America's tomorrow at stake, can we do any
less today?
God bless you all, and God bless the United States of
America.
SMITH
THE WHITE HOUSE
Office of the Press Secretary
For Immediate Release
March 15, 1989
REMARKS BY THE PRESIDENT
TO THE ELECTRONIC INDUSTRIES ASSOCIATION
ANNUAL GOVERNMENT INDUSTRY DINNER
J.W. Marriott Hotel
Washington, D.C.
8:16 P.M. EST
THE PRESIDENT: Thank you all. Thank you for that warm
welcome. I'm glad Pete was listening. I thought he thought I said a
thousand pints of light -- (laughter) -- and that's why -- (applause)
-- I'm delighted to be here -- Chairman Little and President
McCloskey. And I loved the invocation by Peter's brother. I want to
greet the distinguished members of Congress that are here tonight. I
see Jerry Lewis over here, and, of course, our distinguished Majority
Leader, Tom Foley, Larry Welch, member of the Joint Chiefs. And of
course, one down from Pete, my colleague in the White House, our head
of the National Security Council, Brent Scowcroft. And on my right,
affectionately known as "the silver fox". (Applause.)
I'm speaking before the olives, before the celery, and
here's why. This is the most relaxed I've seen Barbara since our dog
got pregnant. (Laughter.) And we've got to go back to the White
House. And I said to her, "Are you coming with me to Texas tomorrow
morning?" She said, "No, what do you mean, Millie is expecting." So
you'll excuse us if we hit and run here.
But I did want to say how pleased I am to be back with
the members of the Electronic Industries Association, all you
distinguished guests. Thank you, Pete, for the introduction.
Bishop Fulton Sheen once said, "The proud man counts his
newspaper clippings -- the humble man counts his blessings." Well, I
am proud indeed to address this annual dinner. But let me confess:
tonight, flanked by colleagues and friends, and many of you all who
I've known over the years, I am more grateful for my blessings.
And let me first congratulate the man with whom Bar and I
just met, this year's EIA Medal of Honor recipient, Sid Topol. And
I want also to say a word about this organization, the oldest and
largest exploring the new horizons of America's technological future.
Today, nearly two million Americans work in your
industry. You're leading America's newest industrial revolution.
You're helping us outwork and outperform the competitors around the
world. And tonight we meet as neighbors and fellow businessmen, and
our goal is a fairer, more productive and ennobling life. Not merely
in our time, but for the generations to come.
A more ennobling life can mean many things. It means
education and opportunity. It means a nation of responsive
- 2 -
the (Applause.) problems that cannot wait, and last, but not least, no new taxes.
And yes, America faces immediate problems -- problems
like ocean dumping, the homeless, illiteracy. And yes, I pledge to
you we will address them now -- not somewhere down the line. But as
we do, let's move beyond the immediate. For today, America is
prosperous and at peace. And to be sure, there are enormous
challenges -- many opportunities presented by changes that are
favorable to democracy, to liberty, to free markets -- favorable to
the principles this country has always stood for.
And therefore, let's recognize that we stand at a special
moment in our history. It's a moment not for complacency, not to
sit back and reflect upon what's been, but to reflect on what might
be. And it's an opportunity to look into the future and plan for it
so that America's place and the well-being of her people are ensured
for generations to come. We must remember the American tradition as
we invest for the future of our own children.
My four objectives will allow America to honor that
heritage and seize her moment. And together, they will solidify
economic freedom. They will expand that freedom. But above all,
they will empower more people, more fully, to partake of the American
Dream.
Reducing the deficit will free our children from interest
debt which haunts their future. Investing in that future will
prepare us as a people for a new century and its challenges.
Focusing on urgent priorities will free government to marshal its
resources. And no new taxes reflects that innately American quality
-- good old-fashioned common sense.
These four objectives will build on the progress of the
last eight years -- they will build a better America and they will
reaffirm our strengths, diffuse ticking time-bombs, and reorient us
as a nation. Above all, they form a new approach which looks to
tomorrow, not just to today.
As President, I'm committed to this new approach. And
that is why last month I proposed an agenda to cut the federal
deficit, help ensure our financial future, and thus enhance business'
ability to plan, expand, and build. And I proposed to cut that
deficit not by increasing the tax burden on the American people, but
by controlling spending and continuing economic growth so that as
more people are working, revenues will rise as tax rates remain the
same.
Next year alone, thanks to economic growth, federal tax
revenues will rise by more than $80 billion. More than $80 billion
even with no new taxes. And my plan will use that new revenue to
slash the federal deficit by more than 40 percent in keeping with the
Gramm-Rudman targets, bringing the deficit literally below the
target.
And, as you know, we've begun the budget process. The
administration has acted. And now, in fairness, we are acting in a
good bipartisan spirit on Capitol Hill to get action. Our task is to
- 3 -
My plan speaks to the long-term and to a stable business climate. It
says that to remain competitive we've got to look beyond the next
quarterly statement. It say yes to America's standard of living and
to her standing in the world.
For instance, let me address the investment that will
result from cutting the maximum rate on capital gains. My plan
supports reducing it to 15 percent on long-held assets. And,
moreover, it effectively eliminates the capital gains tax on people
making less than $20,000. In 1978, this organization, following the
leadership of my late departed friend, Bill Steiger, worked to reduce
the capital gains tax.
Well, today we've got to fight that battle all over
again. We need the capital gains tax differential. (Applause.)
Restoring the capital gains differential will lift revenues, help
savings and free American businesses without distorting world
markets. Consider on the one hand, those competitors who tax capital
gains punitively. By punishing risk-takers, they stifle opportunity.
Less opportunity means less capital to invest. Less capital, in
turn, makes countries less competitive. It's a vicious cycle -- a
bit of a catch 22, and above all, an economic dead end.
On the other hand, keep in mind that some of the most
successful economies of the Pacific Rim -- Hong Kong, Singapore,
Republic of Korea -- exempt capital gains from taxes. And our second
biggest trading partner, Japan, scarely taxed them during her
meteoric rise.
As businessmen, you know this economic history. You know
its lessons are clear. And, like me, you hear a lot about
competitiveness these days. Nothing can make America more
competitive than restoring this differential. America's
entrepreneurs should not have to run an uphill race against the rest
of the world.
Tonight, I challenge the Congress to join with me and
level that playing field. I ask it to expand the marketplace and
assist development. I urge it to increase competitiveness and link
reward and risk. And the way you do that, once again, is by lowering
the tax rate on capital gains.
My friends, the Treasury estimates that this will cut --
that this cut in capital gains -- restoring that differential, will
add $4.8 billion to the revenue side of the ledger in Fiscal Year
1990. So let us use it to expand economic freedom and help people
help themselves. And let us build upon the over 19.5 million new
jobs created in this country since November of 1982 -- five times the
number created in Japan.
Accordingly, my plan to build a better America recommends
a permanent extension of the research and experimentation tax credit.
It'll increase domestic research by multinationals and end the
uncertainly of expiring temporary rules. And by adopting federal
enterprise zones, it'll help those untouched by the economic
recovery.
Enterprise zones are a pioneering initiative to create a
- 4 -
reaffirmation of our national character.
It supports affordable access to space through the
National Aerospace Plane Program and nine space shuttle flights by
1990. It funds space station Freedom, planned for operation in the
mid-1990's. And I'll also elevate the status of the President's
Science Advisor.
You cannot look into the next century without emphasizing
the importance of science. All the unexplored frontiers are not in
space. Many are found closer to home, as we seek to push back the
frontiers of human knowledge. Toward that end, let us invest in the
superconducting supercollider -- a bold new experiment fusing
science, technology and education. And let us expand the work which
will leverage America's technological prowess in such areas as
microcomputers and automative electronics, bioprocessing and then
this high-definition TV. And because science is critical, as I have
said, I intend to double the National Science Foundation budget.
These investments are not some riverboat gamble in a distant future,
but a steadfast way to ensure the future.
And yet, my friends, remember that future is going to
depend above all on our most precious resource, America's children.
We've got to make sure that the kids are educated -- the very
definition of long-term investment in America's future. And that's
why I want Congress to create a $500 million program to award merit
schools.
I intend to create special presidential awards in every
state. I urge expanded use of magnet schools, giving parents and
students freedom of choice. And I propose a program to spur
alternative certification, allowing talented Americans from every
field, especially science and math, to teach in America's classrooms.
It is simply a shame that the brightest among you -- men and women
here tonight -- coming out of science, wanting to give of yourselves
to teach the kids, couldn't qualify because you didn't have the
required number of formal education degrees. It is time we take a
new look and permit those who want to give of themselves to teach in
our public schools. (Applause.)
And you can't talk about a better America without
worrying about the dangers of drugs. We propose the YES program, or
Youth Entering Service to involve our kids in the communities. My
friends, our children can make the 21st Century a new American
century.
So let's help them, guide them. And let us understand
that we are one community -- proud, united and unafraid of the
future. A quote is attributed to Albert Einstein saying, "Everything
that is really great and inspiring is created by individuals who
labor in freedom." For more than 200 years, Americans have invested
their labor, their talent, their compassion and their vision to
preserve freedom, to seize the moment and sustain our way of life.
And I ask you, with America's tomorrow at stake, can we do anything
less today?
God bless you all. Thank you very much for letting
Barbara and me come to this outstanding dinner. We are very grateful
SMITH
THE WHITE HOUSE
Office of the Press Secretary
For Immediate Release
March 15, 1989
REMARKS BY THE PRESIDENT
TO THE ELECTRONIC INDUSTRIES ASSOCIATION
ANNUAL GOVERNMENT INDUSTRY DINNER
J.W. Marriott Hotel
Washington, D.C.
8:16 P.M. EST
THE PRESIDENT: Thank you all. Thank you for that warm
welcome. I'm glad Pete was listening. I thought he thought I said a
thousand pints of light -- (laughter) -- and that's why -- (applause)
-- I'm delighted to be here -- Chairman Little and President
McCloskey. And I loved the invocation by Peter's brother. I want to
greet the distinguished members of Congress that are here tonight. I
see Jerry Lewis over here, and, of course, our distinguished Majority
Leader, Tom Foley, Larry Welch, member of the Joint Chiefs. And of
course, one down from Pete, my colleague in the White House, our head
of the National Security Council, Brent Scowcroft. And on my right,
affectionately known as "the silver fox". (Applause.)
I'm speaking before the olives, before the celery, and
here's why. This is the most relaxed I've seen Barbara since our dog
got pregnant. (Laughter.) And we've got to go back to the White
House. And I said to her, "Are you coming with me to Texas tomorrow
morning?" She said, "No, what do you mean, Millie is expecting." So
you'll excuse us if we hit and run here.
But I did want to say how pleased I am to be back with
the members of the Electronic Industries Association, all you
distinguished guests. Thank you, Pete, for the introduction.
Bishop Fulton Sheen once said, "The proud man counts his
newspaper clippings -- the humble man counts his blessings." Well, I
am proud indeed to address this annual dinner. But let me confess:
tonight, flanked by colleagues and friends, and many of you all who
I've known over the years, I am more grateful for my blessings.
And let me first congratulate the man with whom Bar and I
just met, this year's EIA Medal of Honor recipient, Sid Topol. And
I want also to say a word about this organization, the oldest and
largest exploring the new horizons of America's technological future.
Today, nearly two million Americans work in your
industry. You're leading America's newest industrial revolution.
You're helping us outwork and outperform the competitors around the
world. And tonight we meet as neighbors and fellow businessmen, and
our goal is a fairer, more productive and ennobling life. Not merely
in our time, but for the generations to come.
A more ennobling life can mean many things.- It means
- 2 -
the problems that cannot wait, and last, but not least, no new taxes.
(Applause.)
And yes, America faces immediate problems -- problems
like ocean dumping, the homeless, illiteracy. And yes, I pledge to
you we will address them now -- not somewhere down the line. But as
we do, let's move beyond the immediate. For today, America is
prosperous and at peace. And to be sure, there are enormous
challenges -- many opportunities presented by changes that are
favorable to democracy, to liberty, to free markets -- favorable to
the principles this country has always stood for.
And therefore, let's recognize that we stand at a special
moment in our history. It's a moment not for complacency, not to
sit back and reflect upon what's been, but to reflect on what might
be. And it's an opportunity to look into the future and plan for it
so that America's place and the well-being of her people are ensured
for generations to come. We must remember the American tradition as
we invest for the future of our own children.
My four objectives will allow America to honor that
heritage and seize her moment. And together, they will solidify
economic freedom. They will expand that freedom. But above all,
they will empower more people, more fully, to partake of the American
Dream.
Reducing the deficit will free our children from interest
debt which haunts their future. Investing in that future will
prepare us as a people for a new century and its challenges.
Focusing on urgent priorities will free government to marshal its
resources. And no new taxes reflects that innately American quality
-- good old-fashioned common sense.
These four objectives will build on the progress of the
last eight years -- they will build a better America and they will
reaffirm our strengths, diffuse ticking time-bombs, and reorient us
as a nation. Above all, they form a new approach which looks to
tomorrow, not just to today.
As President, I'm committed to this new approach. And
that is why last month I proposed an agenda to cut the federal
deficit, help ensure our financial future, and thus enhance business'
ability to plan, expand, and build. And I proposed to cut that
deficit not by increasing the tax burden on the American people, but
by controlling spending and continuing economic growth so that as
more people are working, revenues will rise as tax rates remain the
same.
Next year alone, thanks to economic growth, federal tax
revenues will rise by more than $80 billion. More than $80 billion
even with no new taxes. And my plan will use that new revenue to
slash the federal deficit by more than 40 percent in keeping with the
Gramm-Rudman targets, bringing the deficit literally below the
target.
And, as you know, we've begun the budget process. The
administration has acted. And now, in fairness, we are acting in a
- 3 -
My plan speaks to the long-term and to a stable business climate. It
says that to remain competitive we've got to look beyond the next
quarterly statement. It say yes to America's standard of living and
to her standing in the world.
For instance, let me address the investment that will
result from cutting the maximum rate on capital gains. My plan
supports reducing it to 15 percent on long-held assets. And,
moreover, it effectively eliminates the capital gains tax on people
making less than $20,000. In 1978, this organization, following the
leadership of my late departed friend, Bill Steiger, worked to reduce
the capital gains tax.
Well, today we've got to fight that battle all over
again. We need the capital gains tax differential. (Applause.)
Restoring the capital gains differential will lift revenues, help
savings and free American businesses without distorting world
markets. Consider on the one hand, those competitors who tax capital
gains punitively. By punishing risk-takers, they stifle opportunity.
Less opportunity means less capital to invest. Less capital, in
turn, makes countries less competitive. It's a vicious cycle -- a
bit of a catch 22, and above all, an economic dead end.
On the other hand, keep in mind that some of the most
successful economies of the Pacific Rim -- Hong Kong, Singapore,
Republic of Korea -- exempt capital gains from taxes. And our second
biggest trading partner, Japan, scarely taxed them during her
meteoric rise.
As businessmen, you know this economic history. You know
its lessons are clear. And, like me, you hear a lot about
competitiveness these days. Nothing can make America more
competitive than restoring this differential. America's
entrepreneurs should not have to run an uphill race against the rest
of the world.
Tonight, I challenge the Congress to join with me and
level that playing field. I ask it to expand the marketplace and
assist development. I urge it to increase competitiveness and link
reward and risk. And the way you do that, once again, is by lowering
the tax rate on capital gains.
My friends, the Treasury estimates that this will cut --
that this cut in capital gains -- restoring that differential, will
add $4.8 billion to the revenue side of the ledger in Fiscal Year
1990. So let us use it to expand economic freedom and help people
help themselves. And let us build upon the over 19.5 million new
jobs created in this country since November of 1982 -- five times the
number created in Japan.
Accordingly, my plan to build a better America recommends
a permanent extension of the research and experimentation tax credit.
It'll increase domestic research by multinationals and end the
uncertainly of expiring temporary rules. And by adopting federal
enterprise zones, it'll help those untouched by the economic
recovery.
- 4 -
reaffirmation of our national character.
It supports affordable access to space through the
National Aerospace Plane Program and nine space shuttle flights by
1990. It funds space station Freedom, planned for operation in the
mid-1990's. And I'll also elevate the status of the President's
Science Advisor.
You cannot look into the next century without emphasizing
the importance of science. All the unexplored frontiers are not in
space. Many are found closer to home, as we seek to push back the
frontiers of human knowledge. Toward that end, let us invest in the
superconducting supercollider -- a bold new experiment fusing
science, technology and education. And let us expand the work which
will leverage America's technological prowess in such areas as
microcomputers and automative electronics, bioprocessing and then
this high-definition TV. And because science is critical, as I have
said, I intend to double the National Science Foundation budget.
These investments are not some riverboat gamble in a distant future,
but a steadfast way to ensure the future.
And yet, my friends, remember that future is going to
depend above all on our most precious resource, America's children.
We've got to make sure that the kids are educated -- the very
definition of long-term investment in America's future. And that's
why I want Congress to create a $500 million program to award merit
schools.
I intend to create special presidential awards in every
state. I urge expanded use of magnet schools, giving parents and
students freedom of choice. And I propose a program to spur
alternative certification, allowing talented Americans from every
field, especially science and math, to teach in America's classrooms.
It is simply a shame that the brightest among you -- men and women
here tonight -- coming out of science, wanting to give of yourselves
to teach the kids, couldn't qualify because you didn't have the
required number of formal education degrees. It is time we take a
new look and permit those who want to give of themselves to teach in
our public schools. (Applause.)
And you can't talk about a better America without
worrying about the dangers of drugs. We propose the YES program, or
Youth Entering Service to involve our kids in the communities. My
friends, our children can make the 21st Century a new American
century.
So let's help them, guide them. And let us understand
that we are one community -- proud, united and unafraid of the
future. A quote is attributed to Albert Einstein saying, "Everything
that is really great and inspiring is created by individuals who
labor in freedom." For more than 200 years, Americans have invested
their labor, their talent, their compassion and their vision to
preserve freedom, to seize the moment and sustain our way of life.
And I ask you, with America's tomorrow at stake, can we do anything
less today?
God bless you all. Thank you very much for letting
(Smith/Dooley)
March 10, 1989
8:00 p.m.
REMARKS: ELECTRONIC INDUSTRIES ASSOCIATION
MARCH 15, 1989
Members of the Electronic Industries Association, honored
guests, ladies and gentlemen, friends.
You know, twelve years ago John Ralston resigned as head
coach of football's Denver Broncos. "I left because of illness
and fatigue," he explained. "The fans were sick and tired of
me."
Tonight, accordingly, I promise not to speak overtime!
Instead, I want to thank you for that introduction, and for the
warmth of your reception.
Let me first congratulate this year's EIA Medal of Honor
recipient, Sidney Topol (TOE-pull). And I want also to say a
word about this organization, the oldest and largest exploring
the new horizons of America's technological future.
Today, nearly two million Americans work in the electronics
industry. You are leading America's newest industrial
revolution. And you're helping us outwork and outperform any
competitor in the world.
2
You know, Barbara is from New York, and I often kid her
about the definition of a New Yorker: "Someone who meets his
neighbors by seeing them in Florida."
Well, tonight we meet as neighbors, and as fellow
businessmen. Our goal is a fairer, more just, and richer life:
Not merely in our time, but for generations to come.
A richer life can mean many things.
It means education and opportunity. It means a Nation of
responsive citizens -- not only willing but eager to share. And
it means the economic development which makes that sharing
possible. For prosperity depends on growth, and growth depends
on freedom.
My friends, the freedom to dare, risk, and defy the odds
forms the heart of private enterprise, just as private enterprise
is central to America.
Freedom allows us to raise our horizons. Freedom can give
our children a better land than we, ourselves, inherited. But to
preserve it, we must protect it. I have proposed four objectives
to do just that: first, reduce the deficit; second, invest in
America's future; third, find solutions to an urgent set of
priorities; and, last but not least, no new taxes.
3
Reducing the deficit will free our children from interest
debt which haunts their future. Investing in that future will
free them to serve the general interests of America. Focusing on
selective priorities will free government to marshal its
resources. And no new taxes is as All-American as dumping tea
into Boston Harbor.
These objectives will build on the progress of the last
eight years. They will reaffirm our strengths, defuse ticking
time-bombs, and re-orient us as a Nation. Above all, they form a
new approach which looks to tomorrow, not today.
Yes, America faces immediate problems -- ocean dumping, the
homeless, illiteracy. And, yes, I pledge to you: We will
address them now -- not somewhere down the line. But as we do,
let us move beyond the immediate. For, today, America is
prosperous and at peace. Some might say that, today, for the
first time since the mid-1960s, we face no crises, foreign or
domestic -- challenges, yes, but not calamities -- no Viet Nam or
rampant unemployment, no energy shortages, no double-digit
inflation.
We must recognize that we stand at a special moment in our
history. A moment which may afford America a most precious
gift: the gift of time
not for complacency
not to
sit back and reflect upon what has been
but to reflect upon
what might be. Time to take stock; time to think, calmly,
4
prudently; time to avoid mistakes, and ensure this nation's
destiny. Will we use that time? Will we seize our moment? We
will, and we must.
Our new approach says that government, like business, cannot
mortgage the future to engage in self-indulgence. It says that
government can do much, but not everything -- that we must
identify what's necessary to keep us Number One. It says that
the decisions we make, and the direction we choose, will
determine the kind of America in which our children and their
children live.
As President, I am committed to this new approach. That is
why, last month, I proposed a budget to cut the Federal deficit,
help ensure our financial future, and, thus, enhance business'
ability to plan, expand, and build. And I proposed to cut that
deficit not by increasing America's taxes, but by enlarging the
American Pie and keeping spending under control.
My friends, next year alone, thanks to economic growth,
Federal tax revenues will rise by more than $80 billion --- yes,
more than $80 billion, with no new taxes. Our budget seeks to
use that money to slash the Federal deficit by more than $75
billion. That will reduce the deficit to $91 billion, nearly $4
billion below the target mandated by Graham-Rudman-Hollings.
As you know, we have begun the budget process. The
Administration has acted; now, it is up to the Congress to
5
respond. And I'm confident that it will, for no one has termed
our budget "Dead on arrival." Our task is to keep the momentum
going, and growing. Only then can we create the investment so
crucial to America: to increase new jobs; to unlock new markets;
and, yes, to unleash new technologies.
Again, a new approach -- in policy and attitude. For we
Americans are restless, never satisfied: We look to next week,
next year, not to the year 2000. We care that our baseball team
wins the pennant; we care less that its farm system is bursting
at the seams. Casey Stengel once said, "If you can't imitate
him, don't copy him." Well, as Americans, we don't have to
imitate anyone, nor apologize for our ambition. We are
go-getters, and our genius has enriched mankind.
Government's role--its challenge--is to utilize that genius.
For government must look beyond today. By meeting challenges, it
can prevent them from becoming crises. Last year, a large survey
of CEOs revealed that while American business leaders are
inherently optmistic, they believe -- in this poll, by nine to
one -- that we are too short-term oriented. Our budget speaks to
the long-term, and to a stable business climate. It says "Yes"
to America's standard of living, and to her future standing in
the world.
My friends, America's future will need our courage,
creativity, and, most of all, investments. And let me remind you
6
that while I'm referring to economic investments, they can
benefit America socially, culturally, racially, morally. Each
investment can define us as a people. Each can enhance that
moment which comes only once in a thousand years--the beginning
of a new millennium.
For instance, there is the investment that will result from
cutting the maximum tax rate on capital gains. Our budget
supports reducing it to 15 per cent on investments held for a
year or more.
Keep in mind that the economies of the Pacific Rim -- the
"four" dragons" of Hong Kong, Singapore, Taiwan, and South Korea
-- exempt capital gains from taxes; and our second-biggest
trading partner, Japan, didn't tax them at all during her
meteoric rise.
Well, we can learn from our competitors, and also from our
past. History is clear: Restoring the capital gains
differential will lift revenues, help savings, and free American
businesses, without distorting world markets.
Since December 1982, we've created 19 million new jobs in
this country -- five times the number created in Japan. We want
to do still better. Accordingly, our budget recommends a
permanent extension of the Research and Experimentation tax
credit; we need to keep America in the forefront of technological
7
innovation. Our proposal will increase domestic research by
multinationals, and end the uncertainty of expiring temporary
rules.
These steps invest in America's future. They will encourage
progress, stability, and public confidence. And so will
investments, for instance, in education, in the environment,
in our most precious resource, our kids, and in space.
As a Texan, I know, first-hand, the role of space
exploration. I know of your industries' involvement, and your
role in its success. Our budget allocates $2.4 billion for the
Space Program. It supports a flight rate of nine Space Shuttle
flights by 1990. It funds Space Station Freedom, planned for
operation by the mid-1990s. I also want to elevate the status of
the President's Science Advisor to that of the National Security
Advisor.
Like America, space embodies freedom; we must help both
reach unexplored frontiers. Toward that end, let us invest in
the Superconducting Super Collider, which celebrates the fusion
of science, technology, and education. Let us expand free trade
-- free, but fair trade -- which will leverage America's
technological prowess in such areas as microcomputers, automative
electronics, electronic tubes, and high-definition TV. And let
us assist the National Science Foundation. I intend to double
its budget by 1993, and to develop engineering and scientific
8
research centers which link university, government, and industry
labs.
Investments, all, in research and development: Not some
river-boat gamble in a distant future, but a steadfast way to
ensure the future.
And, remember: That future will depend, above all, on
America's children. By investing in them, we can shape America's
dreams of the Twenty-First Century.
Our budget proposes a new child care initiative which
increases options for working parents -- a church can help, or
grandparents, or professional nursery.
Our budget mobilizes resources to teach our children that
drugs are wrong. And we have created the YES Program -- or Youth
Entering Service -- to involve our kids in their communities. We
want to help them understand that a successful life must include
serving others.
But most of all, investment means education. For if
excellence breeds achievement, then excellence must be rewarded
-- in grade school, in high school, and at our colleges and
universities.
9
Consider that between global competition and advancing
technology, the demand for skilled technical professionals will
grow 40 per cent in the coming decade. Yet, the NSF predicts a
shortage of 400,000 scientists 11 years from now. Today, the
number of students who graduate from high school with the skills
to succeed in science- and math-based study is too small to meet
industry's need. Our trading partners produce more engineers per
capita than we do. And these nations' secondary-school students
outperform ours in international math and science tests of
ability.
That is why I want Congress to create a $500-million program
to reward America's "merit schools" -- the schools which improve
the most. I intend to create special Presidential awards in every
State. And I urge expanded use of magnet schools -- giving
parents and teachers the freedom of choice.
I propose a program to spur "alternative certification" --
allowing talented Americans from every field, especially science
and mathematics, to teach in America's classrooms. And through a
program of National Science Scholars, I want to give America's
youth a special incentive to excel in math and science.
We must invest, as well, in minority students; our budget
proposes $60 million over four years in endowment matching grants
for historically black colleges and universities. Many of these
10
students -- black and white -- will one day choose careers based
in new technology. We must ensure they are prepared.
My friends, our children can make the Twenty-first Century a
new American Century. So let us help them, guide them, as free
men and women. And let us understand that we are one
community--proud, united, and unafraid of the future.
I found that out in Texas, after Barbara and I packed our
belongings, moved halfway across the country, and founded an oil
company with 250 workers.
It was there that I learned about the people, problems, and
priorities of industry. I made right decisions, and wrong ones.
And I learned how our fate is not divisible: That to build a
company, like to head a family, we must give of, not merely to,
ourselves.
The business of America isn't only business.
The business of business is America.
Albert Einstein said, "Everything that is really great and
inspiring is created by individuals who labor in freedom." "
11
For more than 200 years, Americans have invested their
labor, their talent, their compassion, and their vision to
preserve freedom, seize the moment, and sustain our way of
life.
I ask you: With America's tomorrow at stake, can we do any
less today?
Thank you for inviting me. Thank you so very much. God bless
you all, and God bless the United States of America.
THE WHITE HOUSE
WASHINGTON
March 13, 1989
MEMORANDUM FOR CHRISS WINSTON
DEPUTY ASSISTANT TO THE PRESIDENT
FOR COMMUNICATIONS
FROM:
WILLIAM J. LANDERS
w
ASSOCIATE COUNSEL TO THE PRESIDENT
SUBJECT:
Presidential Remarks: Electronic
Industries Association
Counsel's Office has reviewed the above-referenced draft remarks
and we have no legal objection to their issuance.
CC: James W. Cicconi
REMARKS: ELECTRONIC INDUSTRIES ASSOCATION
J.W. MARRIOTT HOTEL
MARCH 15, 1989
CHAIRMAN LITTLE, PRESIDENT MCCLOSKEY, MEMBERS OF THE
ELECTRONIC INDUSTRIES ASSOCIATION, HONORED GUESTS, LADIES
AND GENTLEMEN.
THANK YOU FOR THAT GENEROUS INTRODUCTION, AND FOR THE
WARMTH OF YOUR RECEPTION.
BISHOP FULTON SHEEN ONCE SAID, "THE PROUD MAN COUNTS
HIS NEWSPAPER CLIPPINGS -- THE HUMBLE MAN COUNTS HIS
BLESSINGS."
2
WELL, I AM PROUD INDEED TO ADDRESS THIS ANNUAL DINNER.
BUT LET ME CONFESS: TONIGHT, FLANKED BY COLLEAGUES AND
OLD FRIENDS, I AM MORE GRATEFUL FOR MY BLESSINGS.
LET ME FIRST CONGRATULATE THIS YEAR'S EIA MEDAL OF
HONOR RECIPIENT, SIDNEY TOPOL (TOE-PULL). AND I WANT ALSO
TO SAY A WORD ABOUT THIS ORGANIZATION, THE OLDEST AND
LARGEST EXPLORING THE NEW HORIZONS OF AMERICA'S
TECHNOLOGICAL FUTURE.
TODAY, NEARLY TWO MILLION AMERICANS WORK IN THE
ELECTRONICS INDUSTRY.
3
You ARE LEADING AMERICA'S NEWEST INDUSTRIAL REVOLUTION.
AND YOU'RE HELPING US OUTWORK AND OUTPERFORM ANY
COMPETITOR IN THE WORLD.
TONIGHT WE MEET AS NEIGHBORS, AND AS FELLOW
BUSINESSMEN. OUR GOAL IS A FAIRER, MORE PRODUCTIVE, AND
ENNOBLING LIFE, NOT MERELY IN OUR TIME, BUT FOR
GENERATIONS TO COME.
A MORE ENNOBLING LIFE CAN MEAN MANY THINGS. IT MEANS
EDUCATION AND OPPORTUNITY.
4
IT MEANS A NATION OF RESPONSIVE CITIZENS -- NOT ONLY
WILLING BUT EAGER TO SHARE. AND IT MEANS THE ECONOMIC
DEVELOPMENT WHICH MAKES THAT SHARING POSSIBLE. FOR
PROSPERITY DEPENDS ON GROWTH, AND GROWTH DEPENDS ON
FREEDOM.
MY FRIENDS, THE FREEDOM TO DARE, TO RISK, AND DEFY
THE ODDS FORMS THE HEART OF FREE ENTERPRISE, JUST AS FREE
ENTERPRISE IS CENTRAL TO THE AMERICAN DREAM.
FREEDOM CAN GIVE OUR CHILDREN A BETTER LAND THAN WE
OURSELVES INHERITED.
5
BUT TO PRESERVE IT, WE MUST PROTECT IT. THAT IS WHY I
HAVE PROPOSED FOUR OBJECTIVES TO BUILD A BETTER AMERICA:
FIRST, REDUCE THE DEFICIT; SECOND, INVEST IN AMERICA'S
FUTURE; THIRD, ADDRESS THE PROBLEMS OF THE PRESENT -- THE
PROBLEMS THAT CANNOT WAIT; AND, LAST BUT NOT LEAST, NO NEW
TAXES.
YES, AMERICA FACES IMMEDIATE PROBLEMS -- PROBLEMS
LIKE OCEAN DUMPING, THE HOMELESS, ILLITERACY. AND YES, I
PLEDGE TO YOU: WE WILL ADDRESS THEM NOW -- NOT SOMEWHERE
DOWN THE LINE.
6
BUT AS WE DO, LET US MOVE BEYOND THE IMMEDIATE. FOR,
TODAY, AMERICA IS PROSPEROUS AND AT PEACE. To BE SURE,
THERE ARE ENORMOUS CHALLENGES -- AND MANY OPPORTUNITIES
PRESENTED BY CHANGES THAT ARE FAVORABLE TO DEMOCRACY, TO
LIBERTY, TO FREE MARKETS -- FAVORABLE TO THE PRINCIPLES
THIS COUNTRY HAS ALWAYS STOOD FOR.
THEREFORE, LET US RECOGNIZE THAT WE STAND AT A
SPECIAL MOMENT IN OUR HISTORY. IT IS A MOMENT
NOT FOR
COMPLACENCY
NOT TO SIT BACK AND REFLECT UPON WHAT HAS
BEEN
BUT TO REFLECT UPON WHAT MIGHT BE.
7
IT IS AN OPPORTUNITY TO LOOK INTO THE FUTURE AND PLAN FOR
IT so THAT AMERICA'S PLACE, AND THE WELL-BEING OF HER
PEOPLE, ARE ENSURED FOR GENERATIONS TO COME. OUR NATION
HAS ALWAYS HAD A SPECIAL FAITH IN THE FUTURE, AND THE
WISDOM TO INVEST IN IT, WHETHER THROUGH THE FOUNDING OF
GREAT UNIVERSITIES, OR TYING TOGETHER THE CONTINENT BY
RAIL, OR BUILDING THE INTERSTATE HIGHWAY SYSTEM. WE MUST
REMEMBER THAT AMERICAN TRADITION AS WE INVEST FOR THE
FUTURE OF OUR OWN CHILDREN.
8
MY FOUR OBJECTIVES WILL ALLOW AMERICA TO HONOR THAT
HERITAGE, AND SEIZE HER MOMENT. TOGETHER, THEY WILL
SOLIDIFY ECONOMIC FREEDOM. TOGETHER, THEY WILL EXPAND
THAT FREEDOM. BUT ABOVE ALL, THEY WILL EMPOWER MORE
PEOPLE, MORE FULLY, TO PARTAKE OF THE AMERICAN DREAM.
REDUCING THE DEFICIT WILL FREE OUR CHILDREN FROM
INTEREST DEBT WHICH HAUNTS THEIR FUTURE. INVESTING IN
THAT FUTURE WILL PREPARE US AS A PEOPLE FOR A NEW CENTURY
AND ITS CHALLENGES. FOCUSING ON URGENT PRIORITIES WILL
FREE GOVERNMENT TO MARSHAL ITS RESOURCES.
9
AND NO NEW TAXES REFLECTS THAT INNATELY AMERICAN QUALITY
-- GOOD OLD-FASHIONED COMMON SENSE.
THESE FOUR OBJECTIVES WILL BUILD ON THE PROGRESS OF
THE LAST EIGHT YEARS -- THEY WILL BUILD A BETTER AMERICA.
THEY WILL REAFFIRM OUR STRENGTHS, DEFUSE TICKING
TIME-BOMBS, AND RE-ORIENT US AS A NATION. ABOVE ALL, THEY
FORM A NEW APPROACH WHICH LOOKS TO TOMORROW, NOT TODAY.
As PRESIDENT, I AM COMMITTED TO THIS NEW APPROACH.
10
THAT IS WHY, LAST MONTH, I PROPOSED AN AGENDA TO CUT THE
FEDERAL DEFICIT, HELP ENSURE OUR FINANCIAL FUTURE, AND,
THUS, ENHANCE BUSINESS' ABILITY TO PLAN, EXPAND, AND
BUILD. AND I PROPOSED TO CUT THAT DEFICIT NOT BY
INCREASING AMERICA'S TAXES, BUT BY CONTROLLING SPENDING
AND CONTINUING ECONOMIC GROWTH, SO THAT AS MORE PEOPLE ARE
WORKING, REVENUES WILL RISE AS TAX RATES REMAIN THE SAME.
11
MY FRIENDS, NEXT YEAR ALONE, THANKS TO ECONOMIC
GROWTH, FEDERAL TAX REVENUES WILL RISE BY MORE THAN $80
BILLION -- YES, MORE THAN $80 BILLION, EVEN WITH NO NEW
TAXES.
MY PLAN WILL USE THAT NEW REVENUE TO SLASH THE
FEDERAL DEFICIT BY MORE THAN 40 PERCENT, BRINGING THE
DEFICIT BELOW THE TARGET MANDATED BY
GRAMM-RUDMAN-HOLLINGS.
As YOU KNOW, WE HAVE BEGUN THE BUDGET PROCESS.
12
THE ADMINISTRATION HAS ACTED; NOW, WE ARE WORKING WITH
CONGRESS TO GET ACTION. OUR TASK IS To KEEP THE ECONOMY
GOING, AND GROWING. ONLY THEN CAN WE CREATE THE
INVESTMENT so CRUCIAL TO AMERICA: TO INCREASE NEW JOBS;
TO UNLOCK NEW MARKETS; AND, YES, TO UNLEASH NEW
TECHNOLOGIES.
IN A SENSE, THIS IS TYPICALLY AMERICAN. FOR WE ARE
RESTLESS, NEVER SATISFIED: WE LOOK TO NEXT WEEK, NEXT
YEAR, NOT TO THE YEAR 2000.
13
GOVERNMENT'S ROLE -- ITS CHALLENGE -- IS TO HARNESS
THAT AMBITION BY LOOKING BEYOND TODAY. LAST YEAR, A LARGE
SURVEY OF CEOs REVEALED THAT WHILE AMERICAN BUSINESS
LEADERS ARE INHERENTLY OPTIMISTIC, THEY BELIEVE -- IN THIS
POLL, BY NINE TO ONE -- THAT WE ARE TOO SHORT-TERM
ORIENTED. MY PLAN SPEAKS TO THE LONG-TERM, AND TO A
STABLE BUSINESS CLIMATE. IT SAYS THAT TO REMAIN
COMPETITIVE, WE MUST LOOK BEYOND THE NEXT QUARTERLY
STATEMENT. IT SAYS "Yes" TO AMERICA'S STANDARD OF LIVING,
AND TO HER FUTURE STANDING IN THE WORLD.
14
FOR INSTANCE, LET ME ADDRESS THE INVESTMENT THAT WILL
RESULT FROM CUTTING THE MAXIMUM RATE ON CAPITAL GAINS. MY
PLAN SUPPORTS REDUCING IT TO 15 PER CENT ON LONG-HELD
ASSETS. MOREOVER, IT EFFECTIVELY ELIMINATES THE CAPITAL
GAINS TAX ON PEOPLE MAKING LESS THAN $20,000 A YEAR.
IN 1978, THIS ORGANIZATION, FOLLOWING THE LEADERSHIP
OF CONGRESSMAN BILL STEIGER, WORKED TO REDUCE THE CAPITAL
GAINS TAX. WELL, TODAY, WE MUST FIGHT THAT BATTLE AGAIN.
15
RESTORING THE CAPITAL GAINS DIFFERENTIAL WILL LIFT
REVENUES, HELP SAVINGS, AND FREE AMERICAN BUSINESSES,
WITHOUT DISTORTING WORLD MARKETS.
CONSIDER, ON THE ONE HAND, THOSE COMPETITORS WHO TAX
CAPITAL GAINS PUNITIVELY. BY PUNISHING RISK-TAKERS, THEY
STIFLE OPPORTUNITY. LESS OPPORTUNITY MEANS LESS CAPITAL
TO INVEST. LESS CAPITAL, IN TURN, MAKES COUNTRIES LESS
COMPETITIVE. IT'S A VICIOUS CYCLE, A CATCH-22, AND ABOVE
ALL, AN ECONOMIC DEAD-END.
16
ON THE OTHER HAND, KEEP IN MIND THAT SOME OF THE MOST
SUCCESSFUL ECONOMIES OF THE PACIFIC RIM -- HONG KONG,
SINGAPORE, AND THE REPUBLIC OF KOREA -- EXEMPT CAPITAL
GAINS FROM TAXES; AND OUR SECOND-BIGGEST TRADING PARTNER,
JAPAN, SCARCELY TAXED THEM DURING HER METEORIC RISE.
As BUSINESSMEN, YOU KNOW THIS ECONOMIC HISTORY. You
KNOW ITS LESSONS ARE CLEAR. AND, LIKE ME, YOU HEAR A LOT
ABOUT COMPETITIVENESS THESE DAYS.
17
WELL, NOTHING CAN MAKE AMERICA MORE COMPETITIVE THAN
RESTORING THE CAPITAL GAINS DIFFERENTIAL. AMERICA'S
ENTREPRENEURS SHOULD NOT HAVE TO RUN AN UPHILL RACE
AGAINST THE REST OF THE WORLD.
TONIGHT, I CHALLENGE THE CONGRESS TO JOIN WITH ME AND
LEVEL THAT PLAYING FIELD. I ASK IT TO EXPAND THE
MARKETPLACE AND ASSIST DEVELOPMENT. I URGE IT TO INCREASE
COMPETITIVENESS AND LINK REWARD AND RISK. How? BY
LOWERING THE TAX RATE ON CAPITAL GAINS.
18
MY FRIENDS, THE TREASURY ESTIMATES THAT THIS CUT WILL
ADD $4.8 BILLION TO THE REVENUE SIDE OF THE LEDGER IN
FISCAL YEAR 1990. LET US USE IT TO EXPAND ECONOMIC
FREEDOM, AND HELP PEOPLE HELP THEMSELVES. AND LET US
BUILD UPON THE OVER 19 AND 1/2 MILLION NEW JOBS CREATED IN
THIS COUNTRY SINCE NOVEMBER 1982 -- FIVE TIMES THE NUMBER
CREATED IN JAPAN.
ACCORDINGLY, MY PLAN TO BUILD A BETTER AMERICA
RECOMMENDS A PERMANENT EXTENSION OF THE RESEARCH AND
EXPERIMENTATION TAX CREDIT.
19
IT WILL INCREASE DOMESTIC RESEARCH BY MULTINATIONALS, AND
END THE UNCERTAINTY OF EXPIRING TEMPORARY RULES. AND BY
ADOPTING FEDERAL ENTERPRISE ZONES, IT WILL HELP THOSE
UNTOUCHED BY THE ECONOMIC RECOVERY.
ENTERPRISE ZONES ARE A PIONEERING INITIATIVE TO
CREATE A NUMBER OF FEDERALLY-TARGETED ZONES -- OR AREAS --
IN ECONOMICALLY-DISTRESSED COMMUNITIES. BY PROVIDING TAX
BREAKS AND RELIEF FROM REGULATION, THESE ZONES FOSTER A
CLIMATE WHERE BUSINESSES ARE FOUNDED, AND EXISTING
BUSINESSES EXPANDED.
20
ENTERPRISE ZONES, LIKE LOWERING THE TAX ON CAPITAL
GAINS, WILL INVEST IN AMERICA'S FUTURE. AND so WILL OTHER
INVESTMENTS: INVESTMENTS, FOR INSTANCE, IN EDUCATION, IN
THE ENVIRONMENT, IN OUR CHILDREN, AND IN SPACE.
As A TEXAN, I KNOW, FIRST-HAND, THE ROLE OF SPACE
EXPLORATION. I KNOW OF YOUR INDUSTRIES' INVOLVEMENT, AND
YOUR ROLE IN ITS SUCCESS. MY PLAN ALLOCATES AN INCREASE
OF $2.4 BILLION FOR THE SPACE PROGRAM. THIS IS AS MUCH AN
INVESTMENT IN OUR TECHNOLOGICAL FUTURE AS IT IS A
REAFFIRMATION OF OUR NATIONAL CHARACTER.
21
IT SUPPORTS AFFORDABLE ACCESS TO SPACE THROUGH THE
NATIONAL AERO-SPACE PLANE PROGRAM AND NINE SPACE SHUTTLE
FLIGHTS BY 1990. IT FUNDS SPACE STATION FREEDOM, PLANNED
FOR OPERATION IN THE MID-1990s. I ALSO WILL ELEVATE THE
STATUS OF THE PRESIDENT'S SCIENCE ADVISOR.
ALL THE UNEXPLORED FRONTIERS ARE NOT IN SPACE; MANY
ARE FOUND CLOSER TO HOME AS WE SEEK TO PUSH BACK THE
FRONTIERS OF HUMAN KNOWLEDGE. TOWARD THAT END, LET US
INVEST IN THE SUPERCONDUCTING SUPER COLLIDER -- A BOLD NEW
EXPERIMENT, FUSING SCIENCE, TECHNOLOGY, AND EDUCATION.
22
LET US EXPAND THE WORK WHICH WILL LEVERAGE AMERICA'S
TECHNOLOGICAL PROWESS IN SUCH AREAS AS MICRO-COMPUTERS,
AUTOMATIVE ELECTRONICS, BIO-PROCESSING, AND
HIGH-DEFINITION TV. AND BECAUSE SCIENCE IS CRITICAL, AS I
HAVE SAID, I INTEND TO DOUBLE THE NATIONAL SCIENCE
FOUNDATION BUDGET.
THESE INVESTMENTS ARE NOT SOME RIVER-BOAT GAMBLE IN A
DISTANT FUTURE, BUT A STEADFAST WAY TO ENSURE THE FUTURE.
23
AND, YET, MY FRIENDS, REMEMBER: THAT FUTURE WILL DEPEND,
ABOVE ALL, ON OUR MOST PRECIOUS RESOURCE, AMERICA'S
CHILDREN.
WE MUST MAKE SURE THAT OUR CHILDREN ARE EDUCATED --
THE VERY DEFINITION OF LONG-TERM INVESTMENT IN AMERICA'S
FUTURE. THAT IS WHY I WANT CONGRESS TO CREATE A $500
MILLION PROGRAM TO REWARD AMERICA'S "MERIT SCHOOLS." I
INTEND TO CREATE SPECIAL PRESIDENTIAL AWARDS IN EVERY
STATE. AND I URGE EXPANDED USE OF MAGNET SCHOOLS --
GIVING PARENTS AND STUDENTS THE FREEDOM OF CHOICE.
24
I PROPOSE A PROGRAM TO SPUR "ALTERNATIVE CERTIFICATION" --
ALLOWING TALENTED AMERICANS FROM EVERY FIELD, ESPECIALLY
SCIENCE AND MATHEMATICS, TO TEACH IN AMERICA'S CLASSROOMS.
AND THROUGH A NEW PROGRAM OF NATIONAL SCIENCE SCHOLARS, I
WANT To GIVE AMERICA'S YOUTH A SPECIAL INCENTIVE TO EXCEL
IN MATH AND SCIENCE.
To BUILD A BETTER AMERICA, MY PROGRAM ALSO MOBILIZES
RESOURCES TO TEACH OUR CHILDREN THE TRUTH ABOUT THE
DANGERS OF DRUGS.
25
AND WE HAVE PROPOSED THE YES PROGRAM -- OR YOUTH ENTERING
SERVICE -- TO INVOLVE OUR KIDS IN THEIR COMMUNITIES.
MY FRIENDS, OUR CHILDREN CAN MAKE THE TWENTY-FIRST
CENTURY A NEW AMERICAN CENTURY. So LET US HELP THEM,
GUIDE THEM. AND LET US UNDERSTAND THAT WE ARE ONE
COMMUNITY -- PROUD, UNITED, AND UNAFRAID OF THE FUTURE.
A QUOTE IS ATTRIBUTED TO ALBERT EINSTEIN, SAYING,
"EVERYTHING THAT IS REALLY GREAT AND INSPIRING IS CREATED
BY INDIVIDUALS WHO LABOR IN FREEDOM."
26
FOR MORE THAN 200 YEARS, AMERICANS HAVE INVESTED
THEIR LABOR, THEIR TALENT, THEIR COMPASSION, AND THEIR
VISION TO PRESERVE FREEDOM, TO SEIZE THE MOMENT, AND
SUSTAIN OUR WAY OF LIFE. I ASK YOU: WITH AMERICA'S
TOMORROW AT STAKE, CAN WE DO ANY LESS TODAY?
GOD BLESS YOU ALL, AND GOD BLESS THE UNITED STATES OF
AMERICA.
###
(Smith/Dooley)
March 13, 1989
8:00 p.m.
REMARKS: ELECTRONIC INDUSTRIES ASSOCIATION
MARCH 15, 1989
Chairman Little, President McCloskey, members of the
Electronic Industries Association, honored guests, ladies and
gentlemen.
Thank you for that generous introduction, and for the warmth
of your reception.
Bishop Fulton Sheen once said, "The proud man counts his
newspaper clippings -- the humble man counts his blessings."
Well, I am proud indeed to address this bi-annual dinner.
But let me confess: Tonight, flanked by colleagues and old
friends, I am more grateful for my blessings.
Let me first congratulate this year's EIA Medal of Honor
recipient, my old friend Sidney Topol (TOE-pull). And I want
also to say a word about this organization, the oldest and
largest exploring the new horizons of America's technological
future.
Today, nearly two million Americans work in the electronics
industry. You are leading America's newest industrial
revolution. And you're helping us outwork and outperform any
competitor in the world.
2
As you may know, Barbara is from New York, and I often kid
her about the definition of a New Yorker: "Someone who sees his
neighbors by meeting them in Florida."
Well, tonight we meet as neighbors, and as fellow
businessmen. Our goal is a fairer, more productive, and
ennobling life: Not merely in our time, but for generations to
come.
A more ennobling life can mean many things.
It means education and opportunity. It means a nation of
responsive citizens -- not only willing but eager to share. And
it means the economic development which makes that sharing
possible. For prosperity depends on growth, and growth depends
on freedom.
to
My friends, the freedom to dare, risk, and defy the odds
forms the heart of free enterprise, just as free enterprise is
central to the America cheom.
Freedom can give our children a better land than we,
ourselves, inherited. But to preserve it, we must protect it.
That is why I have proposed four objectives to build a better
America: first, reduce the deficit; second, invest in America's
future; third, address the problems of the present -- the
problems that cannot wait; and, last but not least, no new taxes.
3
Yes, America faces immediate problems -- problems like ocean
dumping, the homeless, illiteracy. And, yes, I pledge to you:
We will address them now -- not somewhere down the line. But as
we do, let us move beyond the immediate. For, today, America is
prosperous and at peace. Indeed, some might say that for the
first time since the mid-1960s, we face no crises, foreign or
domestic -- challenges, yes, but not calamities -- no Viet Nam or
rampant unemployment, no energy shortages, no double-digit
inflation.
Therefore, let us recognize that we stand at a special
moment in our history. A moment which may afford America a most
precious gift: the gift of time
not for complacency
not to sit back and reflect upon what has been
but to
reflect upon what might be. Time to take stock; time to think,
calmly, prudently; time to avoid mistakes, and ensure this
nation's destiny.
My four objectives will allow America to use this time, and
seize her moment. Together, they will solidify economic freedom.
Together, they will expand that freedom. But above all, they
will empower more people, more fully, to partake of the American
Dream.
Reducing the deficit will free our children from interest
debt which haunts their future. Investing in that future will
Prepare as apeople for a new century and its
?
4
challenges. Focusing on urgent priorities will free government
to marshal its resources. And no new taxes reflects that inately
American quality - good old-fashioned common sense.
These four objectives will build on the progress of the last
eight years -- they will build a better America. They will
reaffirm our strengths, defuse ticking time-bombs, and re-orient
us as a nation. Above all, they form a new approach which looks
to tomorrow, not today.
Our new approach says that government can do much, but not
everything. It demands that we identify what's necessary to keep
us Number One. It says that the decisions we make, and the
direction we choose, will determine the kind of America in which
our children and their children live.
As President, I am committed to this new approach. That is
why, last month, I proposed an agenda to cut the Federal deficit,
help ensure our financial future, and, thus, enhance business'
ability to plan, expand, and build. And I proposed to cut that
deficit not by increasing America's taxes, but by controlling
spending and enlarging the American Pie.
My friends, next year alone, thanks to economic growth,
Federal tax revenues will rise by more than $80 billion -- yes,
more than $80 billion, even with no new taxes.
5
My plan will use that new revenue to slash the Federal
deficit by more than 40 per cent, bringing the deficit below the
target mandated by Gramm-Rudman-Hollings.
As you know, we have begun the budget process. The
Administration has acted; now, it is up to the Congress to
respond. Our task is to keep the momentum going, and growing.
Only then can we create the investment so crucial to America: to
increase new jobs; to unlock new markets; and, yes, to unleash
new technologies.
In a sense, this is typically American. For we are
restless, never satisfied: We look to next week, next year, not
to the year 2000. Casey Stengel once said, "If you can't imitate
him, don't copy him. Well, as Americans, we don't have to
imitate anyone, nor apologize for our ambition. We are
go-getters; we excell in the short-term; and our genius has
enriched mankind.
Government's role -- its challenge -- is to harness that
genius by looking beyond today. Last year, a large survey of
CEOs revealed that while American business leaders are inherently
optmistic, they believe -- in this poll, by nine to one -- that
we are too short-term oriented. My plan speaks to the long-term,
and to a stable business climate. It says that to remain
competitive, we must look beyond the next quarterly statement.
6
It says "Yes" to America's standard of living, and to her future
standing in the world.
That's what I mean by "investing in the future." And let me
remind you that while I'm referring to economic investments, they
can benefit America socially, culturally, racially, morally. Each
investment can define us as a people. Each can enhance that
moment which comes only once in a thousand years -- the beginning
of a new millennium.
For instance, let me address the investment that will result
from cutting the maximum rate rate on capital gains. My plan
supports reducing it to 15 per cent on long-held assets.
Moreover, it effectively eliminates the capital gains tax on
people making less than $20,000 a year.
He world Series
In 1978, this organization, following the leadership of
Congressman Bill Steiger, worked to reduce the capital gains tax.
9 8 2 7
an
Well, today, we must fight that battle again. For
playing albaseball game a with 18-man
destructively high tax is like loading a revolver -- and pointing
team.
it at ourselves. But restoring the capital gains differential
will lift revenues, help savings, and free American businesses,
without distorting world markets.
Consider, on the one hand, those competitors which who smother
capital gains. By punishing risk-takers, they stifle opportunity.
Less opportunity means less capital to invest. Less capital, in
7
turn, makes countries less competitive. It's a vicious cycle, a
Catch-22, and above all, an economic dead-end.
On the other hand, keep in mind that the economies of the
Pacific Rim -- the "four" dragons" of Hong Kong, Singapore,
Taiwan, and the Republic of South Korea -- exempt capital gains
from taxes; and our second-biggest trading partner, Japan,
scarcely taxed them during her meteoric rise.
As businessmen, you know this economic history. You know
its lessons are clear. And, like me, you hear a lot about
competitiveness these days. Well, nothing can make America more
competitive than restoring the capital gains differential.
My friends, how can Congress sit around talking about
competitiveness when it imposes a stiff tax on the rewards of
investment and risk-taking? And how can it talk about a level
actions make
playing field when its members demand that America's
an
nace
entrepreneurs run uphill against the rest of the world?
Tonight, I challenge the Congress to level that field. I
ask it to expand the marketplace and assist development. I urge
it to increase competitiveness and link reward and risk. In
short, I challenge the Congress to put its votes where its
tonsils are. How? By lowering the tax on capital gains.
8
Let us expand economic freedom, and help people help
themselves. And let us build upon the over 19 and 1/2 million
new jobs created in this country since December 1982 -- five
times the number created in Japan. We want to do still better.
Accordingly, my plan to build a better America recommends a
permanent extension of the Research and Experimentation tax
credit; we need to keep America in the forefront of technological
innovation. My plan will increase domestic research by
multinationals, and end the uncertainty of expiring temporary
rules. And by adopting Federal Enterprise Zones, it will help
those untouched by the economic recovery.
Enterprise Zones are a pioneering initiative to create a
number of Federally-targeted zones -- or areas -- in
economically-distressed communities. By providing tax breaks and
relief from regulation, these zones foster a climate where
businesses are founded, and existing businesses expanded. These
businesses will create many jobs in the targeted communities,
especially for disadvantaged workers.
Already, 37 States have developed Enterprise Zone programs.
It's time we put them to work at the Federal level. Local
communities will benefit. But, more importantly, those who need
a helping hand -- the unemployed, the dispossessed -- will gain
new hope and opportunity: Not across town, but in their own back
yards.
9
Enterprise Zones, like lowering the tax on capital gains,
will invest in America's future. They will encourage progress,
stability, and public confidence. And so will other investments:
investments, for instance, in education, in the environment, in
our children, and in space.
As a Texan, I know, first-hand, the role of space
exploration. I know of your industries' involvement, and your
role in its success. My plan allocates $2.4 billion for the
Space Program. It supports affordable access to space through
the National Aero-Space Plane program and nine Space Shuttle
flights by 1990. It funds Space Station Freedom, planned for
operation in the mid-1990s. I also want to elevate the status of
the President's Science Advisor.
Like America, space embodies freedom -- the freedom which
seeks unexplored frontiers. Toward that end, let us invest in
the Superconducting Super Collider -- a bold new experiment,
fusing science, technology, and education. Let us expand free
trade -- free, but fair trade -- which will leverage America's
technological prowess in such areas as microcomputers, automative
electronics, bioprocessing, and superconductivity. And because
science is critical, as I have said, I intend to double the
National Science Foundation budget. In particular, I want to
develop engineering and scientific research centers which link
university, government, and industry labs.
10
Investments, all, in research and development: Not some
river-boat gamble in a distant future, but a steadfast way to
ensure the future. And, yet, my friends, remember: That future
will depend, above all, on our most precious resource, America's
children. By investing in them, we can shape America's dreams of
the twenty-first century.
To build a better America, my program mobilizes resources to
teach our children that drugs are wrong. And we have proposed
the YES Program -- or Youth Entering Service -- to involve our
kids in their communities. We want to help them understand that
a successful life must include serving others.
But most of all, we want to make sure that our children are
educated -- the very definition of long-term investment in
America's future. For if excellence breeds achievement, then
excellence must be rewarded -- in grade school, in high school,
and at our colleges and universities.
Between global competition and advancing technology, the
demand for skilled technical professionals will grow 40 per cent
in the coming decade. Yet, the NSF predicts a shortage of 400,000
scientists 11 years from now. Today, the number of students who
graduate from high school with the skills to succeed in science-
and math-based study is too small to meet industry's need. Our
trading partners produce more engineers per capita than we do.
11
And these nations' secondary-school. students outperform ours in
international math and science tests of ability.
That is why I want Congress to create a $500-million program
to reward America's "merit schools" -- the schools which improve
the most. I intend to create special Presidential awards in every
State. And I urge expanded use of magnet schools -- giving
parents and students the freedom of choice.
I propose a program to spur "alternative certification" --
allowing talented Americans from every field, especially science
and mathematics, to teach in America's classrooms. And through a
program of National Science Scholars, I want to give America's
youth a special incentive to excel in math and science. Many of
these students will one day choose careers based in new
technology. We must ensure they are prepared.
a
My friends, our children can make the twenty-first century
new
second American Century. So let us help them, guide them, as free
men and women. Let us build the better America that they, like
we, deserve. And let us understand that we are one community --
proud, united, and unafraid of the future.
I found that out in Texas, after Barbara and I packed our
belongings, moved halfway across the country, and founded an oil
company with 250 workers.
12
It was there that I learned about the people, problems, and
priorities of industry. I made right decisions, and wrong ones.
And I learned how our fate is not divisible: That to build a
company, like to head a family, we must give of, not merely to,
ourselves.
The business of America isn't only business.
The business of business is America.
Albert Einstein said, "Everything that is really great and
inspiring is created by individuals who labor in freedom." "
For more than 200 years, Americans have invested their
labor, their talent, their compassion, and their vision to
preserve freedom, seize the moment, and sustain our way of
life.
I ask you: With America's tomorrow at stake, can we do any
less today?
Thank you for inviting me. Thank you so very much. God bless
you all, and God bless the United States of America.
MASTERI
Document No. 015848
WHITE HOUSE STAFFING MEMORANDUM
3/11/89
DATE:
ACTION/CONCURRENCE/COMMENT DUE BY: NOON, MONDAY, 3/13/89
PRESIDENTIAL REMARKS: ELECTRONIC INDUSTRIES ASSOCIATION
MARCH 15, 1989
SUBJECT:
(3/10 - 8:00 p.m. draft)
ACTION FYI
ACTION FYI
VICE PRESIDENT
MCCLURE no comment S
SUNUNU
waiting for 519
NEWMAN
1:30
SCOWCROFT
Philip 2224 Hughes
PORTER
DARMAN
STUDDERT on the way
BATES Denise /Commeree
UNTERMEYER
BREEDEN 2270
ROGERS
CARD 2533
PINKERTON
CICCONI
WINSTON
DEMAREST
GRAHAM
FITZWATER
GRAY 2632 never rec'd
Kilbag
HAGIN
REMARKS:
Please provide cmts/edits directly to Chriss Winston, Rm. 122, x2930,
by NOON, MONDAY, 3/13/89, with an info copy to my office.
Thank you.
RESPONSE:
James W. Cicconi
Assistant to the President
and Deputy to the Chief of Staff
Ext. 2702
(Smith/Dooley)
March 10, 1989
1909 MAR I 8:00 Rdy
REMARKS: ELECTRONIC INDUSTRIES ASSOCIATION
MARCH 15, 1989
Members of the Electronic Industries Association, honored
guests, ladies and gentlemen, friends.
You know, twelve years ago John Ralston resigned as head
?
coach of football's Denver Broncos. "I left because of illness
and fatigue," he explained. "The fans were sick and tired of
me."
Tonight, accordingly, I promise not to speak overtime!
Instead, I want to thank you for that introduction, and for the
warmth of your reception.
Let me first congratulate this year's EIA Medal of Honor
recipient, Sidney Topol (TOE-pull). And I want also to say a
word about this organization, the oldest and largest exploring
the new horizons of America's technological future.
Today, nearly two million Americans work in the electronics
industry. You are leading America's newest industrial
revolution. And you're helping us outwork and outperform any
competitor in the world.
3
These five objectives are mpn tant because
Reducing the deficit will free our children from interest
debt which haunts their future. Investing in that future will
prepore us asapeople foranew century and tschallerges.
free them to serve the general interests of America. Focusing on
selective priorities will free government to marshal its
applepie
resources. And no new taxes is as All American as dumping tea
and usseball
into Boston Harbor.
While exponding opportune ty means a ma + in pue to its withright of
assignality for all its citzens
These objectives will build on the progress of the last
eight years. They will reaffirm our strengths, defuse ticking
(Knder,gentler
time-bombs, and re-orient us as a Nation. Above all, they form a
new approach which looks to tomorrow, not today.
Yes, America faces immediate problems problems ocean dumping, the
homeless, illiteracy. And, yes, I pledge to you: We will
address them now -- not somewhere down the line. But as we do,
let us move beyond the immediate. For, today, America is
prosperous and at peace. Some might say that, today, for the
first time since the mid-1960s, we face no crises, foreign or
domestic -- challenges, yes, but not calamities -- no Viet Nam or
rampant unemployment, no energy shortages, no double-digit
inflation.
We must recognize that we stand at a special moment in our
history. A moment which may afford America a most precious
gift: the gift of time
not for complacency
not to
sit back and reflect upon what has been
but to reflect upon
what might be. Time to take stock; time to think, calmly,
It says that government must be a cata got
bringing out the best in our nst tutrons individuals. and encorraging
the to lents of all of us as free
prudently; time to avoid mistakes, and ensure this nation's
destiny. Will we use that time? Will we seize our moment? We
will, and we must.
Our new approach says that government, like business, cannot
mortgage the future to engage in self-indulgence. It says that
government can do much, but not everything
that we must
identify what's necessary to keep us Number One. It says that
the decisions we make, and the direction we choose, will
determine the kind of America in which our children and their
children live.
As President, I am committed to this new approach. That is
why, last month, I proposed a budget to cut the Federal deficit,
help ensure our financial future, and, thus, enhance business'
ability to plan, expand, and build. And I proposed to cut that
deficit not by increasing America's taxes, but by enlarging the
American Pie and keeping spending under control.
My friends, next year alone, thanks to economic growth,
Federal tax revenues will rise by more than $80 billion -- yes,
even
my plan
will
more than $80 billion, with no new taxes. Our budget seeks to
40%. 40
use that money to slash the Federal deficit by more than $75
billion. That will reduce the deficit to $91 billion, nearly $4
?
billion below the target mandated by Graham-Rudman-Hollings.
As you know, we have begun the budget process. The
Administration has acted; now, it is up to the Congress to
2
You know, Barbara is from New York, and I often kid her
about the definition of a New Yorker: "Someone who meets his
neighbors by seeing them in Florida. "
Well, tonight we meet as neighbors, and as fellow
revordeng
more production and more
businessmen. Our goal is a fairer, more just, and richer life:
Not merely in our time, but for generations to come.
rewarding
A richer life can mean many things.
It means education and opportunity. It means a Nation of
responsive citizens -- not only willing but eager to share. And
it means the economic development which makes that sharing
possible. For prosperity depends on growth, and growth depends
on freedom.
to
to
My friends, the freedom to dare, risk, and defy the odds
forms the heart of private free enterprise, just as private enterprise
just as free interprise
is central to the Umerican cheam,
is central to America.
Freedom allows us to broacley raise our horizons. Freedom can give
our children a better land than we, ourselves, inherited. But to
and, yes, share it we must share its venefits and opputence
preserve it, we must protect it. I have proposed four five objectives
build a better (merica
to do just that: first, reduce the deficit; second, invest in
America's future; third, find solutions to an urgent set of
address the problems of the
the problems that cont want
present--
priorities; and, last but not least, no new taxes.
Butwe have yet anazher usp
to resal out and extend the appn tumity for all
our Desple to shore in the american dream:
5
respond. And I'm confident that it will, for no one has termed
our budget "Dead on arrival." Our task is to keep the momentum
going, and growing. Only then can we create the investment so
crucial to America: to increase new jobs; to unlock new markets;
and, yes, to unleash new technologies.
Again, a new approach -- in policy and attitude. For we
Americans are restless, never satisfied: We look to next week,
next year, not to the year 2000. We care that our baseball team
wins the pennant; we care less that its farm system is bursting
at the seams. Casey Stengel once said, "If you can't imitate
him, don't copy him." Well, as Americans, we don't have to
imitate anyone, nor apologize for our ambition. We are
go-getters, and our genius has enriched mankind.
Government's role--its challenge--is to utilize that genius.
For government must look beyond today. By meeting challenges, it
can prevent them from becoming crises. Last year, a large survey
of CEOs revealed that while American business leaders are
If we are to remain its competitive ifuture, we must shift our a Here ton
inherently optmistic, they believe -- in this poll, by nine to
one -- that we are too short-term oriented. ^ Our budget speaks to to the
the long-term, and to a stable business climate. It says "Yes" longtern-
puell begn
to America's standard of living, and to her future standing in
the next
the world.
quality
Statement
My friends, America's future will need our courage,
creativity, and, most of all, investments. And let me remind you
6
that while I'm referring to economic investments, they can
benefit America socially, culturally, racially, morally. Each
investment can define us as a people. Each can enhance that
moment which comes only once in a thousand years the beginning
of a new millennium.
For instance, there is the investment that will result from
cutting the maximum tax rate on capital gains. Our budget
supports reducing it to 15 per cent on investments held for a
year or more.
Keep in mind that the economies of the Pacific Rim -- the
the Republic of
"four" dragons" of Hong Kong, Singapore, Taiwan, and South Korea
-- exempt capital gains from taxes; and our second-biggest
trading partner, Japan, didn't tax them at all during her
meteoric rise.
Well, we can learn from our competitors, and also from our
past. History is clear: Restoring the capital gains
differential will lift revenues, help savings, and free American
businesses, without distorting world markets.
November
over 19 1/2
(Weicker)
over
Since December 1982, we've created 19 million new jobs in
this country -- five times the number created in Japan. We want
to do still better. Accordingly, our budget recommends a
permanent extension of the Research and Experimentation tax
credit; we need to keep America in the forefront of technological
7
innovation. Our proposal will increase domestic research by
multinationals, and end the uncertainty of expiring temporary
rules.
These steps invest in America's future. They will encourage
progress, stability, and public confidence. And so will
investments, for instance, in education, in the environment,
in our most precious resource, our kids, and in space.
As a Texan, I know, first-hand, the role of space
exploration. I know of your industries' involvement, and your
provides an increase of
fundng
role in its success. Our budget allocates $2.4 billion for the
Space Program. It supports a flight Stef rate of nine Space Shuttle
flights by 1990. It funds Space Station Freedom, planned for
operation by the mid-1990s. I also want to elevate the status of
the President's Science Advisor to that of the National Security
Advisor.
Like America, space embodies freedom; we must help both
reach unexplored frontiers. Toward that end, let us invest in
the Superconducting Super Collider, which celebrates the fusion
of science, technology, and education. Let us expand free trade
-- free, but fair trade -- which will leverage America's
technological prowess in such areas as microcomputers, automative
electronics, electronic tubes, and high-definition TV. And let
us assist the National Science Foundation. I intend to double
its budget by 1993, and to develop engineering and scientific
8
research centers which link university, government, and industry
labs.
Investments, all, in research and development: Not some
river-boat gamble in a distant future, but a steadfast way to
ensure the future.
And, remember: That future will depend, above all, on
America's children. By investing in them, we can shape America's
dreams of the Twenty-First Century.
check
Our budget proposes a new child care initiative which
into
increases options for working parents -- a church can help, or
grandparents, or professional nursery.
Our budget mobilizes resources to teach our children that
drugs are wrong. And we have created proposed the YES Program -- or Youth
Entering Service -- to involve our kids in their communities. We
want to help them understand that a successful life must include
serving others.
your children of very mous define nations future. fion
But most of all, investment means education.
For if
excellence breeds achievement, then excellence must be rewarded
-- in grade school, in high school, and at our colleges and
universities.
9
Consider that between global competition and advancing
technology, the demand for skilled technical professionals will
grow 40 per cent in the coming decade. Yet, the NSF predicts a
shortage of 400,000 scientists 11 years from now. Today, the
number of students who graduate from high school with the skills
to succeed in science- and math-based study is too small to meet
industry's need. Our trading partners produce more engineers per
capita than we do. And these nations' secondary-school students
outperform ours in international math and science tests of
ability.
That is why I want Congress to create a $500-million program
to reward America's "merit schools" -- the schools which improve
the most. I intend to create special Presidential awards in every
State. And I urge expanded use of magnet schools -- giving
parents and teachers the freedom of choice.
I propose a program to spur "alternative certification" --
allowing talented Americans from every field, especially science
and mathematics, to teach in America's classrooms. And through a
program of National Science Scholars, I want to give America's
youth a special incentive to excel in math and science.
We must invest, as well, in minority students; our budget
proposes $60 million over four years in endowment matching grants
for historically black colleges and universities Many of these
move
10
students black and white will one day choose careers based
in new technology. We must ensure they are prepared.
My friends, our children can make the Twenty-first Century a
new American Century. So let us help them, guide them, as free
men and women. And let us understand that we are one
community--proud, united, and unafraid of the future.
I found that out in Texas after Barbara and I packed our
belongings, moved halfway across the country, and founded an oil
company with 250 workers.
It was there that I learned about the people, problems, and
priorities of industry. I made right decisions, and wrong ones.
And I learned how our fate is not divisible: That to build a
company, like to head a family, we must give of, not merely to,
ourselves.
The business of America isn't only business.
The business of business is America.
Albert Einstein said, "Everything that is really great and
inspiring is created by individuals who labor in freedom."
11
For more than 200 years, Americans have invested their
labor, their talent, their compassion, and their vision to
preserve freedom, seize the moment, and sustain our way of
life.
I ask you: With America's tomorrow at stake, can we do any
less today?
Thank you for inviting me. Thank you so very much. God bless
you all, and God bless the United States of America.
7
innovation. our proposal will increase domestic research by
multinationals, and end the uncertainty of expiring temporary
rules.
These steps invest in America's futura. They will encourage
progress, stability, and public confidence. And so will
investments, for instance, in education, in the environment,
in our most precious resource, our kids, and in space.
As a Texan, I know, first-hand, the role of space
exploration. I know of your industries' involvement, and your
role in its success. our budget allocates $2.4 billion for the
Space Program. It supports a flight rate of nine Space Shuttle
flights by 1990. It funds Space Station Freedom, planned for
operation by the mid-1990s. I also want to elevate the status of
the President's science Advisor to that of the National Security
Advisor.
huh? wholes? is
Like America, space embodies freedom; we must help both
reach unexplored frontiers. Toward that end, let us invest in
the Superconducting Super collider, which celebrates the fusion
of science, technology, and education. Let us expand free trade
- free, but fair trade -- which will leverage America's
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electronics, electronic tubes And high definition TV) And let
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: 11:25PM : 68-81-8 :
L
THE WHITE HOUSE
WASHINGTON
March 13, 1989
Memorandum to Chriss Winston
RBP
byll
From:
Roger B. Porter
Jim Pinkerton
Re:
Comments on EIA draft
This draft makes two important points:
That a peaceful, tranquil America enjoys an historic
moment of opportunity
That we should seek to consolidate this opportunity
through the Building a Better America program
(including the capital gains reduction)
We think that this message is insufficiently compelling. We
suggest is that the speech have three points: the two points
above, plus a third point, below:
That we will expand our vision and extend this
opportunity to others -- especially the poor -- and
that one of the best ways of making America "kinder and
gentler" is to reduce the capital gains tax.
The designated news "hook" of the speech is the reduction of
the capital gains tax rate. We need to point out that a capital
gains tax rate cut can do much more than consolidate economic
freedom. It can expand economic freedom. To paraphrase John
Kenneth Galbraith, it is more inspiring to comfort the afflicted
than it is to comfort the comfortable!
One way to enlarge the otherwise narrow, business-based
coalition that favors cutting capital gains is by finding new
recruits, for example, Blacks and those interested in the
progress of Blacks. We should tie in enterprise zones as a
further means of empowering individuals and expanding economic
freedom. We should note that the President's proposal
effectively eliminates the capital gains tax on people making
less than $20,000 a year.
(more)
2-2-2
Jack Kemp and his whole intellectual movement are the
leading exponents of this vision of opportunity and upward
mobility. The message is that we are not just undertaking these
programs to help hi-tech entrepreneurs. We are doing this to
help all Americans, especially the poor -- the very people who
have been left out of the economic expansion of the last six and
a half years.
Finally, we need to forthrightly ask the audience for help
in this crusade to give all Americans the chance to pursue the
American dream.
p.1, para. 2 The joke here starts us off with some downbeat
phrases: "illness and fatigue
...
sick
and
tired."
p.2, para's 1,2,3 Following a joke about evidently wealthy New
Yorkers meeting their neighbors in Florida, we use the phrase
"richer life" in the succeeding two paragraphs. We need some
concept here that does not have a financial connotation, for lack
of a better word, "fulfilling" or "meaningful" or "greater."
p.2, para. " forms the heart of private enterprise, just as
private enterprise is central to America." Note that "private
enterprise" -- people accumulating for themselves -- is not realy
as ennobling as "free enterprise. In "free enterprise, the
emphasis is on freedom -- the chance to enter into the
marketplace and to do well. "Free enterprise" connotes an open
door of opportunity, and also echoes the economic freedom
argument that underlies the entire Building a Better America
program.
We'd change to: " forms the heart of free enterprise,
just as free enterprise is central to the American dream.'
p.2, para. 6 "Freedom allows us to raise our horizons. You
raise expectations or goals, not horizons. You either "broaden"
or "lengthen" or "extend" your horizons.
This paragraph begins to get at the heart of the argument:
here's what we have to do to consolidate freedom; preserve it and
protect it.
(more)
3-3-3
But it is insufficient just to say that freedom ought to be
consolidated. The President has a broader mission. We suggest
disentangling all the notions in this key paragraph into two
complete and discrete thoughts:
O
Concept 1:
Consolidate economic freedom.
O
Concept 2:
Extend economic freedom and the benefits
thereof.
In the "four objectives" listed here, the third, "find
solutions to an urgent set of priorities", might seem clearer if
we said something like "address the problems of the present --
the problems that cannot wait." -- (this also ties-in better with
the "immediate problems" paragraph on the next page (p.3,
para.3).
More importantly, as we noted earlier we would suggest
taking the four concepts and adding a fifth, which gives the
President a more active and morally purposeful mission: to reach
out, to extend opportunity, to empower people to participate
fully in the American Dream.
Finally, this paragraph needs to mention the phrase
"Building A Better America" e.g., "I have proposed four [or
five] objectives to Build a Better America:"
p.3, para. This paragraph recapitulates the preceding
paragraph (p.2, para. 6) but in an allusory way. We need to make
it more explicit. We'd suggest enumerating the president's
points at the beginning of the paragraph: "My four [five]
objectives for Building a Better America are important
because
"
If we get in the habit of itemizing, we will look more
organized and coherent about the President's goals.
The rationale advanced in this paragraph for Investing in
that future" is weak. We don't so much want to free" them to
advance the commonweal as much as we want to empower them -- give
them the skills -- to do so.
(more)
4-4-4
The paragraph concludes: "And no new taxes is as All-
American as dumping tea into Boston Harbor." We made Boston
Harbor a big issue in 1988, yet we have conspicuously not added
funds for the clean-up. To mention Boston Harbor is to invite a
retaliatory whack from the press as well as the Dukakis
Administration.
p.3, para. We'd amend "re-orient us as a Nation" to
"re-orient us as a kinder, gentler nation.
p.3, para.3 "Yes, America faces immediate problems - ocean
dumping, the homeless, illiteracy." We should make a structural
decision here: either enunciate these immediate goals before
itemizing the Building A Better America goals, or elso follow-up
the "Building a Better America" package in the 1-2-3-4 sequence
outlined in the last paragraph on page 2. The way the speech
reads now, we give the prescription and then the diagnosis.
p.3, para. This is an important philosophical paragraph. As
such, it should either come before page 2's Building A Better
America goals or at the very end of the speech. There's
something anti-climactic about laying out your four- (or five-)
point agenda and then going into a discourse on the last 25 years
of American history.
p.4, para. I think the rhetorical questions set forth here are
effective, a la Reagan's "If not us, who?; if not now, when?"
formulation. But I think they are most effective at the end of
a speech, especially at the close of this draft, which, as it is,
rushes toward an end in the last page or two.
p.4, para.3 "... I proposed a budget to cut the Federal
deficit "Budget" is a green eyeshade concept, and in the
most literal sense, sub-Presidential. We need more ambitious,
Presidential phrases that connote, in Nixon's phrase, "the lift
of a driving dream." Thus, we should consider phrases like
"agenda," "missions," "goals," and "vision."
In connection with language on the President's agenda, we
should regularly use the phrase "Building a Better America."
(more)
5-5-5
In the concluding sentence here, " not by increasing
America's taxes, but by enlarging the American Pie and keeping
spending under control," at a minimum these two thoughts should
be reversed. "Keeping spending under control" is the not as
broad a concept as "expanding the pie" and thus "pie" should
come second.
Also, with apologies to Don McLean, it seems to us that the
Stat
notion of "American Pie" needs to be explained somewhat. We
suggest "controlling spending and encouraging economic growth SO
that the pie of opportunity grows to give every American --
especially the needy -- a larger piece."
p.4, para. 4 There are too many dollar figures in this
paragraph:
"
$80 billion
$75 billion
$91 billion
$4
billion
" This can be said in a cleaner way: We'd change the
first sentence to read " more that $80 billion, even [a
crucial interpolation for emphasis] with no new taxes. " Then
start a new paragraph: "My plan [not "Our budget"] will [not
"seeks to"] use that new revenue to slash the Federal deficit by
more than 40%.
We would note that a $91 billion deficit is not a figure to
be terribly proud of. $91 billion is still a big chunk of change
to the average citizen. We ought to instead say: " slash
the
Federal deficit by more than 40%, bringing the deficit below the
Gramm-Rudman-Hollings targets.
With these changes, this paragraph is no longer a series of
dollar figures, but now has one dollar figure ($80 billion)
repeated twice for emphasis, one impressive-sounding percentage
(a 40% cut), and two clear statements: One) "no new taxes;" and
Two) we come in below the Gramm-Rudman-Hollings targets.
Note also: "Gramm," not "Graham."
p.5, para. "Dead On Arrival" -- As noted before, patting
ourselves on the back for this meager accomplishment begs some
Democrat to knock this boast down.
p.5, para. Is this not a paragraph which belongs either at the
beginning or the end of the speech? -- probably at the end, as a
buildup to a feel-good, rising climax.
(more)
6-6-6
p.5, paras. 3, 4 These paragraphs appear to be making a point
about investing in the future. But they don't quite say that.
These are legitimate points, but by the time we get to this place
in the speech no one is going to understand what we're talking
about. The set-up ought to be as prosaic as:
"
and the third
item of my agenda is investing in our future."
Also "use," " not "utilize," and "goals," "vision," "agenda,"
etc., not "budget."
p.6, para. Again "agenda," etc., not "budget."
p.6, para. 4 This terse treatment of capital gains -- the heart
of the speech -- needs to be expanded. As noted before, our
proposal effectively eliminates capital gains taxes for those
earning less than $20,000 a year. This underlines the point that
capital gains tax rate reduction helps the poor the most.
Furthermore, the Bush proposal is a carefully crafted reduction,
designed to eliminate tax shelters (in general, the EIA does not
care about tax shelters).
p.7, para. "I also want to elevate the status of the
President's Science Advisor to that of the National Security
Advisor." This statement needs to be modified. In its current
form, it tests the President's credibility to the limit. It's
one thing to make the Science Advisor an Assistant to the
President, it's another to say he's equal to Brent Scrowcroft.
p.7, para. 4 "Like America, space embodies freedom; we must
help both reach unexplored frontiers." Both what?
"
let us invest in the Superconducting Super Collider,
which celebrates the fusion of science, technology, and
education." The SSC cannot celebrate. Instead:
=
the
Superconducting Super Collider -- a bold new experiment, fusing
science, technology, education."
"
leverage America's technological prowess in such areas
as microcomputers, automative electronics, electronic tubes, and
high definition TV." We are concerned about this list,
especially "electronic tubes" and HDTV. Is this a fair
assessment of where America enjoys "technological prowess?" Are
we really going to use free and fair trade to leverage this
technological prowess?
(more)
7-7-7
"And let us assist the National Science Foundation." This
is a lame sentence. We'd change to: "Science is critical. As I
have said, I intend to double the National Science Foundation
budget." The President pledged to double the NSF budget in a
speech at Yale in the Fall of 1987. If we aren't mistaken,
that's the baseline for the doubled budget. Let's not slip up
and inadvertently let March 1989 be the new benchmark! Whether
we intend to double it from FY'88 levels or FY'90 levels needs
checking.
p.8, para. "Our budget proposes a new child care initiative
which increases options for working parents -- a church can help,
or grandparents, or professional nursery." This is too stripped-
down a description of our proposal to garner any support. In any
case, child care is extraneous to this speech. We'd be better
off deleting the whole paragraph. Again, "our budget" should be
"my program for Building a Better America" or "my agenda," etc.
p.10, para.2 " our children can make the Twenty-first Century
a new American Century." The allusion to Henry Luce needs to be
focused: it's the second American century, not a "new" American
century.
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