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Detroit Economic Club 9/10/92 [OA 5812] [3]
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4
6
Document No. 349020ss
WHITE HOUSE STAFFING MEMORANDUM
92 SEP 9 P4: 46
DATE:
9/9/92
ACTION/CONCURRENCE/COMMENT DUE BY: TODAY, 9/9 2:00p.m.
PRESIDENTIAL REMARKS: DETROIT ECONOMIC CLUB
SUBJECT:
THURSDAY, SEPT. 10
ACTION FYI
ACTION FYI
VICE PRESIDENT
MCBRIDE
BAKER
MOORE
SCOWCROFT
MULLINS
DARMAN
PETERSMEYER
BATES
PORTER
BRADY
PROVOST
BROMLEY
ROSS
CALIO
SMITH
DEMAREST
TUTWILER
FITZWATER
ZOELLICK
GRAY
BOSKIN
HOLIDAY
KAUFMAN
HORNER
MCGROARTY
REMARKS:
Please forward your comments directly to Dan McGroarty, RM. 122, x2930,
no later than 2:00 p.m., TODAY, SEPTEMBER 9, with a copy to this office.
Thank you.
RESPONSE:
Important substantine dranges on RP.
PHILLIP D. BRADY
Assistant to the President
8,18 $ 19. Remander conect
and Staff Secretary
minor stylistre, grammatical, or
Ext. 2702
factual problems. Gave Schaem 9/9/92
THE WHITE HOUSE
WASHINGTON
September 8, 1992
SEP 8 P11:27
MEMORANDUM FOR THE PRESIDENT
THROUGH:
STEVE PROVOST
SP
FROM:
ANDY FERGUSON az
SUBJECT:
DETROIT ECONOMIC CLUB
On Thursday morning, September 10th you will deliver remarks
(38 mins., teleprompted) to 2,000 members of the Detroit Economic
Club. Your speech unveils your Agenda for American Renewal.
Your remarks are drawn exclusively from the Agenda.
Note: Given the significance of this speech, we wanted to be sure
you had an opportunity to review it during the day. We- will be
refining it on Wednesday, but hoped to get general reaction from
you as we are doing so.
September 8, 1992
11:00 p.m.
AGENDA
PRESIDENTIAL REMARKS: DETROIT ECONOMIC CLUB
SEPTEMBER 10, 1992
DETROIT, MICHIGAN
Good morning, everyone. (Acknowledgments)
This morning I am releasing an Agenda for American Renewal.
And I've come here today to introduce it to you and the nation.
My agenda diagnoses the economic problems our nation faces,
lays out the principles that should guide us in the years ahead,
and explains the integrated approach I am pursuing to meet the
challenge.
Over the past weeks I have been discussing elements of my
economic agenda, and in the weeks ahead I will be expanding on
those and other ideas. The document I am releasing today shows
how the pieces fit together.
But let's begin this morning by stepping back, taking stock
of where we are as a great nation in the broader sweep of
history.
The American people have just completed the greatest mission
in the lifetime of our country -- the triumph of democratic
capitalism over imperial communism.
Today, this year, for the first time since December 1941,
the United States is not engaged in a war, hot or cold.
Throughout history, at the close of prolonged and costly
wars, victors have confronted the problem of securing a new basis
for peace and prosperity. The American people recognize that we
stand at such a watershed.
2
They sense the epic changes at work in the world and the
economy, the uneasiness that stirs the democracies who served as
our partners in the long struggle.
They feel the uneasiness in their own homes and communities;
and they see the difficulties of those who have felt change most
directly.
And they know that while we face an era of great
opportunity, we face great risks as well -- if we fail to make
the right choices, if we fail to engage this new world wisely.
But America has always possessed unique powers, and foremost
among them is the power of regeneration -- to transform anxiety
into opportunity. Only in America do we have the people, the
talents -- the principles and ideals -- to fully embrace the
world that opens before us.
For America to be safe and strong, we must meet the defining
challenge of the 1990s: to win the economic competition -- to win
the peace.
We must be a military superpower, an economic superpower,
and an export superpower.
My Agenda for Renewal asks that we look forward -- to open
new markets, prepare our people to work, strengthen our families,
-- to save and invest -- so that we can win.
Our renewal depends on economic growth -- but growth not for
the few at the expense of the many, not for the present at the
expense of the future.
3
In our country we have always prized an entrepreneurial
capitalism that grows from the bottom up, not the top down, a
prosperity that begins on Main Street and extends to Wall Street
-- not the other way around.
We have never been seduced by the view my opponent offers -
- of a government that accumulates capital by taxing it and
borrowing it from the people, and spending it according to an
industrial policy fashioned from the latest academic theories.
My agenda is for an inclusive, not an exclusive America --
and surely not for a reclusive one. My international economic
and trade strategy will guarantee our position as an export
superpower, extending our global economic reach in tandem with
our security presence -- to stretch beyond our borders so that we
can create more jobs within them.
At the same time, we need to foster at home the capabilities
that will keep us in the lead: radical changes in our education
system to prepare our children for a constantly changing
workplace; incentives for entrepreneurs and new technologies to
sharpen our competitive edge; job training and health care reform
to promote the economic security of our working men and women;
and new approaches for reaching out to those who have been left
behind, since in the century ahead we will need the aspirations
and energy of every American.
And finally, because our greatest strengths flow not from
government but from the personal initiative and energy of free
the next
4
men and women, my agenda aims to check the growth of government,
and, in some important ways, to reverse it
Fitted together, each overarching and underpinning the
other, the components of this agenda, should renew America
according to her most cherished principles.
And this renewed America will be empowered toward a grand
goal: to nearly double the size of our economy, to $10 trillion,
by the early years of this century.
To place my agenda in a larger context, let me turn briefly
to five profound changes now at work in our economy. When
Americans gather around the kitchen table at night, and talk
about how they'll meet a mortgage, or pay the doctor's bill,
they're feeling these changes in their lives. And before the
changes have run their course, they will have forever altered the
way Americans buy and sell, work and create.
The first great change in our economy is ironically caused
by our very success in ending the Cold War. In the short run,
reductions in defense spending have meant painful lay-offs in
many industries, and we are taking steps to ease this transition.
But in the medium and long run, reductions in defense spending
will free up priceless skills and technologies for peacetime
growth.
Second, most of our industries are transforming themselves
from the old-style hierarchical organizations to so-called
flattened pyramids, emphasizing a skills-based workforce, "lean
production," and shorter product cycles. From castings to
5
computers, this is a revolution as dramatic as the one made
earlier this century, when Henry Ford led the country from craft-
based production to mass manufacturing.
While these changes are essential to maintaining our
competitive edge, they've come with a cost -- lay-offs and
cutbacks among both white- and blue-collar workers, who must
worry about their health care and pensions. These hard-working
people need reassurance -- not only about their economic
security, but about preserving the sense of self-worth that only
work can provide.
The third change: while the 1980s brought us the greatest
peacetime expansion in our history, the boom also led too many
companies and too many households to take on too much debt.
history ill suited
We have been paying down that debt -- and lower interest
rates have helped us do it. The process is largely over, but
consumers and companies remain cautious.
The fourth change involves our financial system. We entered
the '80s with a banking system designed 50 years earlier, a relic
in an era when billions of investment dollars can cross borders
at the speed of light.
international
The late '70s threatened this anachronism with record
interest and inflation rates -- as well as newer, more
competitive financial services. The less efficient institutions
could not survive, obligating the federal government to protect
the savings of millions of Americans.
6
This process, too, is nearing its end. The result will be a
more flexible and efficient financial system. But for now,
lenders are cautious and, despite low rates, small businesses
still find access to credit difficult.
The most far-reaching of these five changes is the emergence
of a global economy. No nation is an island today. One out of
every six manufacturing jobs is directly tied to exports. The
crops sown from one out of every three acres of farmland is sold
abroad.
Care
Consider three implications of the global economy: One, when
growth slows abroad, as it has recently, our own growth slows as
well. Two, America will only grow in the next century if it can
compete globally -- in every part of the world. And three, we
must seize every opportunity to open new markets, particularly
those with the greatest potential for expansion.
C
Now, in drafting an agenda for America's future, we had
to
assess our strengths as well as our weaknesses. Conveniently,
the other side has discovered many weaknesses, very few
strengths. of course, they might find temporary political gain
in portraying an America past her prime and over the hill. But
they have no more right to argue, for partisan purposes, that our
economy is weaker than it is, than I have to underestimate our
problems.
Our strengths are real. The Misery Index -- the sum of
inflation and unemployment -- is 10.8 percent today, down from
19.6 percent in 1980.
don't unply that me
have developed an norigenda
only
7
Inflation stands at about three percent.
Interest rates are at a twenty year low.
The purchasing power of Americans gives us the highest
standard of living in the world.
We enjoy the highest home ownership rate of all major
industrialized countries.
We send 68 percent of our children on to higher education -
- more than any other country -- and well above Germany's 32
percent and Japan's 30 percent.
And with 5 percent of the world's population, we produce 25
percent of the world's total output.
I could go on but I do not mean to suggest that all is well
-- that we do not need to lead and manage the changes
tubuts" many
transforming our economy. But you can't chart the stars if you
wice
think the sky is falling. Over the past 12 years we have almost
doubled the size of our economy. It's as if we created two extra
economies the size of Germany's from scratch.
How will we meet our goals? Before outlining the specifics
of my agenda, allow me to set out four principles. I believe
these principles are deeply embedded in the American creed -- for
the principles that must guide change are the principles that
must never change.
First, I believe America is a nation of special individuals,
not special interests. And individuals, in turn, draw strength
and protection from families and communities, not the Government.
why exclude non-
economic
8
regulation
?
Second, because the individual, not the government, is the
basis of a free society, an agenda for economic growth must
adhere to certain fundamentals: lower tax rates, limits on
Government spending, sound money, greater competition, less
regulation, and more open trade.
Third, government can build on these fundamentals by
offering opportunity and hope for individuals, families, and
we have
communities. There is a conservative agenda for helping people,
for responding to their needs, by giving them the means, the
capabilities, and the confidence to make the decisions that
matter in life.
Finally, all our policies must be brought together
effectively if we are to prosper as a people and succeed as a
nation. Just as barriers between countries and companies fall in
the global economy, so too the traditional distinctions between
foreign and domestic, economic and security policies look
increasingly artificial. Our aim must be to execute our policies
as a unified program to make America secure and strong.
Therefore my Agenda for American Renewal calls for action on
six interconnected fronts. We face complex problems; no single
solution will suffice. The whole of our agenda will be greater
than the sum of its parts.
First, Challenging the World. During the Cold War, we built
a global security structure underpinned by military alliances
across the Atlantic and Pacific. In the same way, the post-Cold
War era requires a strategic economic and trade policy -- global
9
in scope, and underpinned by our status as an economic and export
superpower.
We are uniquely positioned to achieve this goal. As the
largest fully integrated market in the world, we wield leverage
with other countries that want access to our market.
As both a Pacific and a European power, we are tied to the
largest and most rapidly growing economies across both oceans.
And as the strongest nation in our hemisphere, we are looked
to for leadership by free economies emerging from Chile to
Mexico.
The same holds true for the newly born economies of Eastern
Europe and the former Soviet Union, where our values, our
products, even our language, carry a unique appeal. In Moscow
these days, the lines at McDonalds are longer than the lines at
Lenin's Tomb.
The key to America's growth, expansion, and innovation has
always been our openness to trade, investment, ideas, and people.
As this openness is at last being reciprocated around the world,
we find ourselves again at a special advantage.
The next steps in my strategic trade policy are to secure
Congressional approval of the North American Free Trade Agreement
and to complete the global trade negotiations, creating American
jobs and expanding the pool of customers for American products.
Let me emphasize: these agreements are steps, not ends in
themselves.
10
Our goal is to develop a strategic network of free trade
agreements across the Atlantic and the Pacific and in our own
hemisphere -- with Latin America; with Poland, Hungary and
in
Czechoslovakia; and countries across. the Pacific
room
As these external barriers fall, I believe we can reduce
internal barriers to competition as well -- in North America,
Western Europe, Japan, and elsewhere. Greater competition will
encourage entrepreneurial capitalism at the expense of government
power and entrenched interests, spurring still greater economic
growth.
Traveling around the country I have seen it happen already -
- particularly in our small businesses, as they reorient
themselves toward exports and international competition. A
couple of weeks ago, in St. Louis, I visited Public Safety
Equipment, Inc., a manufacturer of sirens, light-bars and other
safety devices. The president of Public Safety told me that a
few years ago, they recognized the time was long past when they
could sell their products in the fifty states and leave it at
that. So they took on the world. Now 35 percent of what they
make is sold in 66 countries.
Public Safety, and the hundreds of thousands of companies
like it, offer a glimpse into the future I envision for all
American business.
But a business is only as efficient, as resilient and smart,
as the people who keep its books and build its products and make
its strategy. Materials, machines, and methods will come and go,
11
but the American worker will remain the key to our economic
security. That brings me to the second component of my agenda:
Preparing Our Children.
The workplace of the 21st Century will be constantly
changing. We must prepare the American people for a lifetime of
learning, to keep a step ahead of that process of change.
Developed nations need developing minds.
The burden will fall on our educational system. As in the
past, education should be the ladder that children of modest
means can climb to better themselves.
Our current school system is not meeting these needs.
Designed for the 19th Century, it will collapse under the
pressures of the 21st. And it must be said: our educational
establishment is caught in the same time warp, where standing
still means falling behind.
Money alone is not the answer -- the United States already
spends more per pupil than any other country but Switzerland.
The answer is a radical overhaul of the system itself. If we
want to change our country, we've got to change our schools.
And the catalyst for change -- the one change that drives
all others -- is school choice, giving all parents the means and
freedom to choose which schools will best serve their children.
Competition is the principle that must underlie education reform.
And competition will not work unless parents are allowed to
choose their children's schools -- whether it's the public school
across town or the parochial school across the street.
12
Wealthy families already have this choice for their
children. Many people you saw at the Democratic National
Convention have choice for their children. Why shouldn't you
have choice for your children?
Consider one statistic: In Chicago, 47 percent of public
school teachers send their children to private schools. Clearly
they know something about monopoly education my opponent doesn't.
Our different approaches to education reform reveal the
great divide between my opponent and me. You will see the same
contrast in child care, health care, and a host of other issues.
The opposition prefers uniformity to variety and choice, relying
on government bureaucracies to offer "one-size-fits-all service."
I don't want to pull everyone down to make them equal. I want to
give everyone the tools to climb as high as they can dream.
Having prepared our children for the world of work, the
question remains what kind of work they will do. The third
component of my agenda for renewal is therefore: Sharpening
Businesses' Competitive Edge. Our ultimate success as an
economic superpower is dependent on the performance of our
private businesses -- on our success in encouraging
entrepreneurial capitalism.
The free market does not operate according to academic
theory or abstract industrial policies. It operates on common
sense. I learned my economics the way most of you did -- a lot
late nights sweating over a balance sheet, trying to meet a
payroll.
be in greater demand
13
I saw that if people are allowed to keep more of what they
produce, they will produce more than they can use.
The
remainder
is called capital.
When capital is taxed lightly, it becomes abundant. When it
is taxed heavily, it becomes scarce -- available only to those at
the top, who need it least of all. That's not what I want.
too capable
If capital were more abundant, however, labor would become
of
unis
more scarce Wages would rise, unemployment lines would shrink.
That is what I want.
That's why I want enterprise zones in our inner cities and
rural areas. That's why I want to make the R & D tax credit
permanent. And that's why I want to cut the capital gains tax
and index it for inflation.
Those are the fundamentals. I also see three other ways to
sharpen the competitive edge of American business:
-- first, strengthening small business, by cutting taxes,
ensuring that credit is available, and by lifting the dead weight
of government regulation;
-- second, supporting civilian R&D, by bringing the
development, production and marketing of technology closer
to the consumer;
-- and third, reforming our costly legal system, which mires
even conscientious businesses and individuals in a swamp of
frivolous lawsuits. My product liability reform and Access to
Justice Act will drain the swamp.
14
Frankly, passage of these bills won't be easy. Trial
lawyers are a powerful vested interest -- well-represented in
Congress and high on the list of political contributors, as my
opponent well knows. But America will never lead the world in
the 21st Century until we learn to sue each other less and care
for each other more.
The most competitive companies in the coming decades will be
those that most involve their workers in the business at hand.
Working men and women will want to know that they can enjoy both
economic opportunity and security. That is the fourth component
of my agenda: Promoting Economic Security.
Again, common sense shows the way: True security will come
only by developing individual capability, not dependency. And
that independence, in turn, comes through the private sector, not
the government.
Government's role will be to ease the individual's
adjustment to a fast-changing marketplace.
This means, in practice, a wider and more flexible range of
job training and placement services -- for both the young and
old, the blue and white-collar worker, and particularly during
the present period, workers from our defense industries.
The pace of the new economy makes new job training
approaches necessary: most workers will have more than one
employer, often more than one career, over the course of their
working lives. This fact raises concerns as well about workers'
ability to preserve their pensions as they make those changes.
15
This summer I signed a law to increase pension portability, but
there is still much to do.
Economic security requires as well a major reform of our
health care system. The present system's uncontrollable costs
and inaccessible coverage is the cause of great unease, even
fear, throughout our economy.
My reforms, which I have outlined in detail elsewhere,
addresses the roots of these problems while preserving and
building on our system's strengths -- our state-of-the-art care,
openness to innovation, and diversity of consumer choice. Taken
together, my reforms would cut health care costs by $394 billion.
In health care, as in so many issues this year, we stand at
a crossroads. The path my opponents have chosen would place a
full 13 percent of our economy under the control of the federal
government -- meaning more bureaucracy, rationed care,
inefficient delivery of services, and, in the end, higher costs.
Let common sense be our guide: We must enhance competition
and market forces, not restrict them; we must preserve individual
choice, not hand decision-making over to centralized
bureaucracies; we must reduce the burden on employers and
employees, not bury them in a tide of new taxes and government
regulations.
Job training, retirement security, affordable health care:
When combined with a new system of education and entrepreneurial,
competitive business, we can offer genuine economic security to
our working men and women.
discuss crume here as well Cb on P.16?
fifth
16
The programs I've outlined are based on the principles that
will empower all Americans to make their own choices and better
their lives. But I believe we need to do more for some of our
citizens who have been left behind. That is the sixth component
of my agenda: Leaving No One Behind.
The American Dream is nothing more or less than the belief
that all Americans can make a better life for their children.
The dream has made us the most dynamic society in the world; and
in the new century that dynamism will be essential to outpace the
economic competition. We can only turn it to our full advantage
if every American has a shot at making good on the dream.
I reject the shopworn logic that sees poverty as a simple
lack of income -- a kind of economic shortfall that can be
replaced with a government check. A conservative philosophy of
empowerment must have at its foundation the creation of
character, through the ownership of property and the dignity of
work. That means sweeping away the nightmare of crime from our
cities, building a core of property owners, creating business
incentives, and making individual discipline and self-reliance
the goal of all our programs. The human capital unleashed in
this way will do much to drive us forward into the 21st Century.
I call the final component of my Agenda -- "Rightsizing
Government."
You'll recognize that I take the term from the business
world -- which has a lot to teach those of us in government. At
a time when companies across the country have been restructuring,
17
cutting fat, increasing efficiency -- all to prepare for the
economic competition of tomorrow -- the federal government faces
an obligation to do the same.
Today the federal government spends nearly twenty-four cents
of every dollar of the nation's income. That figure provides
vivid proof of what I have often said: Government is too big and
it spends too much.
A bloated federal government, serving itself seconds rather
than serving the people first, will weigh us down in the economic
race of a new era.
The Agenda I publish today contains specific proposals to
cut the fat: caps on the growth in mandatory spending and a
freeze on domestic spending; a balanced budget amendment and a
line-item veto; and a new mechanism -- a check-off box on tax
returns -- to give taxpayers the power to cut the deficit
themselves.
The size and structure of government are relics of a
different age -- artifacts more suited to the dilemmas of fifty
years ago than the problems of today. An American renewal will
require a streamlined government -- consolidating agencies,
use salames
tightening budgets, and cutting the salaries of highly paid
federal employee:
Unlike my opponent, I do not believe the American people are
with
undertaxed. Quite the opposite: I am committed to cutting taxes
trivater
across the board. Let me offer an illustration of what we could
do: If Congress had acted on the $130 billion in specific
18
spending cuts I have already proposed, we could cut income tax
rates by one percent across the board; reduce the small business
tax rate from 15 percent to 10 percent, and reduce the tax on
capital gains.
That is the direction I propose we go: to tax less and spend
less; and to redirect our current spending to serve the interests
of all Americans.
I honestly believe that this is the way -- the only way --
to control the size of the federal government. The facts are
painful but plain: For Congressmen, spending is power. And they
will exercise that power until they have spent every last dime
they can squeeze from the working men and women of America. It's
as simple as this: Raising taxes won't cut the deficit.
Here, then, is my Agenda for American Renewal. It comes at
a time unique in our history, a turning point, a moment when one
era is passing away and another is being born.
I intend to fight for this Agenda, to fight as hard as I can
to get as much as I can, and then I'm going to come back for
more. If Congress balks, I'll move forward anyway -- just as I
have done with education and welfare reform. I'll work with the
governors, with state and local governments, with the private
sector -- with anyone who shares the urge to renew our country.
With the close of the Cold War we can target peace,
prosperity and promise at home. The American people want that.
The American people deserve it.
and regulatory
19
At the same time, Americans recognize that the great events
of recent years have shaken the world. If we are to succeed, as
a nation and a people, if we are to hold true to all that has
made America the last, best hope of man on earth, then our
renewal at home must enable us to make the 21st Century yet
another American Century.
My Agenda draws together our people and our government to
meet this challenge. We will create a $10 trillion economy. We
will renew America. We will win the peace.
reg wates less,
I want America to seize this moment. I want to stimulate
entrepreneurial capitalism, not punish it; I want to empower
people to make their own choices, not yoke them to new
bureaucracies. I want a government that spends less and taxes
less,
And I will fight without hesitation for a free flow of
trade and capital and ideas around the world -- because Americans
compete, never retreat.
I know times have been difficult for many Americans. The
world we knew as children -- no matter your age -- will never be
the same. America will change -- that is our destiny; how it
will change will soon be decided.
I ask, when you step into that voting booth, to please
(
consider carefully whose agenda for change best fits America's
principles, our national experience, and our hopes for lasting
peace and prosperity.
XXX
Document No. 349020ss
6765
WHITE HOUSE STAFFING MEMORANDUM
92 SEP 9 P2.23
DATE:
9/9/92
ACTION/CONCURRENCE/COMMENT DUE BY: TODAY, 9/9 2:00p.m.
PRESIDENTIAL REMARKS: DETROIT ECONOMIC CLUB
SUBJECT:
THURSDAY, SEPT. 10
ACTION FYI
ACTION FYI
VICE PRESIDENT
MCBRIDE
BAKER
MOORE
SCOWCROFT
MULLINS
DARMAN
PETERSMEYER
BATES
PORTER
BRADY
PROVOST
BROMLEY
ROSS
CALIO
SMITH
DEMAREST
TUTWILER
FITZWATER
ZOELLICK
GRAY
BOSKIN
HOLIDAY
KAUFMAN
HORNER
MCGROARTY
REMARKS:
Please forward your comments directly to Dan McGroarty, RM. 122, x2930,
no later than 2:00 p.m., TODAY, SEPTEMBER 9, with a copy to this office.
Thank you.
September 9, 1992
Mr. Dan McGroarty:
RESPONSE:
marginal community celded.
PHILLIP D. BRADY
Assistant to the President
and Staff Secretary
Brent Scowcroft
Ext. 2702
THE WHITE HOUSE
WASHINGTON
September 8, 1992
SEP 8 P11:27
MEMORANDUM FOR THE PRESIDENT
THROUGH:
STEVE PROVOST SP
FROM:
ANDY FERGUSON 3
SUBJECT:
DETROIT ECONOMIC CLUB
On Thursday morning, September 10th you will deliver remarks
(38 mins., teleprompted) to 2,000 members of the Detroit Economic
Club. Your speech unveils your Agenda for American Renewal.
Your remarks are drawn exclusively from the Agenda.
Note: Given the significance of this speech, we wanted to be sure
you had an opportunity to review it during the day. We will be
refining it on Wednesday, but hoped to get general reaction from
you as we are doing SO.
September 8, 1992
11:00 p.m.
AGENDA
PRESIDENTIAL REMARKS: DETROIT ECONOMIC CLUB
SEPTEMBER 10, 1992
DETROIT, MICHIGAN
Good morning, everyone. (Acknowledgments)
This morning I am releasing an Agenda for American Renewal.
And I've come here today to introduce it to you and the nation.
My agenda diagnoses the economic problems our nation faces,
lays out the principles that should guide us in the years ahead,
and explains the integrated approach I am pursuing to meet the
challenge.
Over the past weeks I have been discussing elements of my
economic agenda, and in the weeks ahead I will be expanding on
those and other ideas. The document I am releasing today shows
how the pieces fit together.
But let's begin this morning by stepping back, taking stock
of where we are as a great nation in the broader sweep of
history.
The American people have just completed the greatest mission
in the lifetime of our country -- the triumph of democratic
capitalism over imperial communism.
Today, this year, for the first time since December 1941,
the United States is not engaged in a war, hot or cold.
Throughout history, at the close of prolonged and costly
wars, victors have confronted the problem of securing a new basis
for peace and prosperity. The American people recognize that we
stand at such a watershed.
2
They sense the epic changes at work in the world and the
economy, the uneasiness that stirs the democracies who served as
our partners in the long struggle.
They feel the uneasiness in their own homes and communities;
and they see the difficulties of those who have felt change most
directly.
And they know that while we face an era of great
opportunity, we face great risks as well -- if we fail to make
the right choices, if we fail to engage this new world wisely.
But America has always possessed unique powers, and foremost
among them is the power of regeneration -- to transform anxiety
into opportunity. Only in America do we have the people, the
talents -- the principles and ideals -- to
fully
embrace
the
world that opens before us.
For America to be safe and strong, we must meet the defining
challenge of the 1990s: to win the economic competition -- to win
the peace.
We must be a military superpower, an economic superpower,
and an export superpower.
My Agenda for Renewal asks that we look forward -- to open
new markets, prepare our people to work, strengthen our families,
-- to save and invest -- so that we can win.
Our renewal depends on economic growth -- but growth not for
the few at the expense of the many, not for the present at the
expense of the future.
3
In our country we have always prized an entrepreneurial
capitalism that grows from the bottom up, not the top down, a
prosperity that begins on Main Street and extends to Wall Street
-- not the other way around.
We have never been seduced by the view my opponent offers -
- of a government that accumulates capital by taxing it and
borrowing it from the people, and spending it according to an
industrial policy fashioned from the latest academic theories.
My agenda is for an inclusive, not an exclusive America --
and surely not for a reclusive one. My international economic
and trade strategy will guarantee our position as an export
superpower, extending our global economic reach in tandem with
our security presence -- to stretch beyond our borders so that we
can create more jobs within them.
At the same time, we need to foster at home the capabilities
that will keep us in the lead: radical changes in our education
system to prepare our children for a constantly changing
workplace; incentives for entrepreneurs and new technologies to
sharpen our competitive edge; job training and health care reform
to promote the economic security of our working men and women;
and new approaches for reaching out to those who have been left
behind, since in the century ahead we will need the aspirations
and energy of every American.
And finally, because our greatest strengths flow not from
government but from the personal initiative and energy of free
4
men and women, my agenda aims to check the growth of government,
and, in some important ways, to reverse it.
Fitted together, each overarching and underpinning the
other, the components of this agenda should renew America
according to her most cherished principles.
And this renewed America will be empowered toward a grand
goal: to nearly double the size of our economy, to $10 trillion,
thenext
by the early years of this century.
To place my agenda in a larger context, let me turn briefly
to five profound changes now at work in our economy. When
Americans gather around the kitchen table at night, and talk
about how they'll meet a mortgage, or pay the doctor's bill,
they're feeling these changes in their lives. And before the
changes have run their course, they will have forever altered the
way Americans buy and sell, work and create.
The first great change in our economy is ironically caused
by our very success in ending the Cold War. In the short run,
is
the huge
reductions in defense spending have meant painful lay-offs in
budget
deficit
many industries, and we are taking steps to ease this transition.
a
But in the medium and long run, reductions in defense spending
change?
will free up priceless skills and technologies for peacetime
growth.
Second, most of our industries are transforming themselves
from the old-style hierarchical organizations to so-called
flattened pyramids, emphasizing a skills-based workforce, "lean
production," and shorter product cycles. From castings to
5
computers, this is a revolution as dramatic as the one made
earlier this century, when Henry Ford led the country from craft-
based production to mass manufacturing.
While these changes are essential to maintaining our
competitive edge, they've come with a cost -- lay-offs and
cutbacks among both white- and blue-collar workers, who must
worry about their health care and pensions. These hard-working
people need reassurance -- not only about their economic
security, but about preserving the sense of self-worth that only
work can provide.
The third change: while the 1980s brought us the greatest
peacetime expansion in our history, the boom also led too many
companies and too many households to take on too much debt.
We have been paying down that debt -- and lower interest
rates have helped us do it. The process is largely over, but
consumers and companies remain cautious.
The fourth change involves our financial system. We entered
the '80s with a banking system designed 50 years earlier, a relic
in an era when billions of investment dollars can cross borders
at the speed of light.
The late '70s threatened this anachronism with record
interest and inflation rates -- as well as newer, more
competitive financial services. The less efficient institutions
could not survive, obligating the federal government to protect
the savings of millions of Americans.
6
This process, too, is nearing its end. The result will be a
more flexible and efficient financial system. But for now,
lenders are cautious and, despite low rates, small businesses
still find access to credit difficult.
The most far-reaching of these five changes is the emergence
of a global economy. No nation is an island today. One out of
every six manufacturing jobs is directly tied to exports. The
crops sown from one out of every three acres of farmland is sold
abroad.
Consider three implications of the global economy: One, when
growth slows abroad, as it has recently, our own growth slows as
well. Two, America will only grow in the next century if it can
compete globally -- in every part of the world. And three, we
must seize every opportunity to open new markets, particularly
those with the greatest potential for expansion.
Now, in drafting an agenda for America's future, we had to
assess our strengths as well as our weaknesses. Conveniently,
the other side has discovered many weaknesses, very few
strengths. of course, they might find temporary political gain
in portraying an America past her prime and over the hill. But
they have no more right to argue, for partisan purposes, that our
economy is weaker than it is, than I have to underestimate our
problems.
Our strengths are real. The Misery Index -- the sum of
was
inflation and unemployment -- is 10.8 percent today, down from
interest
also part
19.6 percent in 1980.
to
7
Inflation stands at about three percent.
Interest rates are at a twenty year low.
The purchasing power of Americans gives us the highest
standard of living in the world.
We enjoy the highest home ownership rate of all major
industrialized countries.
We send 68 percent of our children on to higher education -
- more than any other country -- and well above Germany's 32
percent and Japan's 30 percent.
And with 5 percent of the world's population, we produce 25
percent of the world's total output.
I could go on, but I do not mean to suggest that all is well
-- that we do not need to lead and manage the changes
transforming our economy. But you can't chart the stars if you
Real
GDP
think the sky is falling. Over the past 12 years we have almost
growth less that was
doubled the size of our economy.
It's as if we created
two extra
an
Slies
economies
roughly the size of Germany's from scratch.
2nd 1987 More: How will we meet our goals? Before outlining the specifics
1979
GDP
of my agenda, allow me to set out four principles. I believe
1991 bill
A
27% these principles are deeply embedded in the American creed -- for
the principles that must guide change are the principles that
must never change.
First, I believe America is a nation of special individuals,
not special interests. And individuals, in turn, draw strength
and protection from families and communities, not the Government.
8
Second, because the individual, not the government, is the
basis of a free society, an agenda for economic growth must
adhere to certain fundamentals: lower tax rates, limits on
Government spending, sound money, greater competition, less
economic regulation, and more open trade.
Third, government can build on these fundamentals by
offering opportunity and hope for individuals, families, and
communities. There is a conservative agenda for helping people,
for responding to their needs, by giving them the means, the
capabilities, and the confidence to make the decisions that
matter in life.
Finally, all our policies must be brought together
effectively if we are to prosper as a people and succeed as a
nation. Just as barriers between countries and companies fall in
the global economy, so too the traditional distinctions between
foreign and domestic, economic and security policies look
increasingly artificial. Our aim must be to execute our policies
as a unified program to make America secure and strong.
Therefore my Agenda for American Renewal calls for action on
six interconnected fronts. We face complex problems; no single
solution will suffice. The whole of our agenda will be greater
than the sum of its parts.
First, Challenging the World. During the Cold War, we built
based on
a global security structure underpinned by military alliances
across the Atlantic and Pacific. In the same way, the post-Cold
War era requires a strategic economic and trade policy -- global
basedon
9
in scope, and underpinned by our status as an economic and export
superpower.
We are uniquely positioned to achieve this goal. As the
largest fully integrated market in the world, we wield leverage
with other countries that want access to our market.
As both a Pacific and a European power, we are tied to the
largest and most rapidly growing economies across both oceans.
And as the strongest nation in our hemisphere, we are looked
to for leadership by free economies emerging from Chile to
Mexico.
The same holds true for the newly born economies of Eastern
Europe and the former Soviet Union, where our values, our
products, even our language, carry a unique appeal. In Moscow
these days, the lines at McDonalds are longer than the lines at
Lenin's Tomb.
The key to America's growth, expansion, and innovation has
always been our openness to trade, investment, ideas, and people.
As this openness is at last being reciprocated around the world,
we find ourselves again at a special advantage.
The next steps in my strategic trade policy are to secure
Congressional approval of the North American Free Trade Agreement
and to complete the global trade negotiations, creating American
jobs and expanding the pool of customers for American products.
Let me emphasize: these agreements are steps, not ends in
Move
themselves.
Uruguay Round of
10
Our goal is to develop a strategic network of free trade
agreements across the Atlantic and the Pacific and in our own
hemisphere -- with Latin America; with Poland, Hungary and
Czechoslovakia; and countries across the Pacific.
As these external barriers fall, I believe we can reduce
internal barriers to competition as well -- in North America,
Western Europe, Japan, and elsewhere. Greater competition will
encourage entrepreneurial capitalism at the expense of government
power and entrenched interests, spurring still greater economic
growth.
Traveling around the country I have seen it happen already -
- particularly in our small businesses, as they reorient
themselves toward exports and international competition. A
couple of weeks ago, in St. Louis, I visited Public Safety
Equipment, Inc., a manufacturer of sirens, light-bars and other
safety devices. The president of Public Safety told me that a
few years ago, they recognized the time was long past when they
could sell their products in the fifty states and leave it at
that. So they took on the world. Now 35 percent of what they
make is sold in 66 countries.
Public Safety, and the hundreds of thousands of companies
like it, offer a glimpse into the future I envision for all
American business.
But a business is only as efficient, as resilient and smart,
as the people who keep its books and build its products and make
its strategy. Materials, machines, and methods will come and go,
11
but the American worker will remain the key to our economic
security. That brings me to the second component of my agenda:
Preparing Our Children.
The workplace of the 21st Century will be constantly
changing. We must prepare the American people for a lifetime of
learning, to keep a step ahead of that process of change.
Developed nations need developing minds.
The burden will fall on our educational system. As in the
past, education should be the ladder that children of modest
means can climb to better themselves.
Our current school system is not meeting these needs.
Designed for the 19th Century, it will collapse under the
pressures of the 21st. And it must be said: our educational
establishment is caught in the same time warp, where standing
still means falling behind.
Money alone is not the answer -- the United States already
spends more per pupil than any other country but Switzerland.
The answer is a radical overhaul of the system itself. If we
want to change our country, we've got to change our schools.
And the catalyst for change -- the one change that drives
all others -- is school choice, giving all parents the means and
freedom to choose which schools will best serve their children.
Competition is the principle that must underlie education reform.
And competition will not work unless parents are allowed to
choose their children's schools -- whether it's the public school
across town or the parochial school across the street.
12
Wealthy families already have this choice for their
children. Many people you saw at the Democratic National
Convention have choice for their children. Why shouldn't you
have choice for your children?
Consider one statistic: In Chicago, 47 percent of public
school teachers send their children to private schools. Clearly
they know something about monopoly education my opponent doesn't.
Our different approaches to education reform reveal the
great divide between my opponent and me. You will see the same
contrast in child care, health care, and a host of other issues.
The opposition prefers uniformity to variety and choice, relying
on government bureaucracies to offer "one-size-fits-all service."
I don't want to pull everyone down to make them equal. I want to
give everyone the tools to climb as high as they can dream.
Having prepared our children for the world of work, the
question remains what kind of work they will do. The third
component of my agenda for renewal is therefore: Sharpening
Businesses' Competitive Edge. Our ultimate success as an
economic superpower is dependent on the performance of our
private businesses -- on our success in encouraging
entrepreneurial capitalism.
The free market does not operate according to academic
theory or abstract industrial policies. It operates on common
sense. I learned my economics the way most of you did -- a lot
of
late nights sweating over a balance sheet, trying to meet a
payroll.
13
I saw that if people are allowed to keep more of what they
produce, they will produce more than they can use. The remainder
is called capital.
When capital is taxed lightly, it becomes abundant. When it
is taxed heavily, it becomes scarce -- available only to those at
the top, who need it least of all. That's not what I want.
If capital were more abundant, however, labor would become
more scarce. Wages would rise, unemployment lines would shrink.
That is what I want.
That's why I want enterprise zones in our inner cities and
rural areas. That's why I want to make the R & D tax credit
permanent. And that's why I want to cut the capital gains tax
and index it for inflation.
Those are the fundamentals. I also see three other ways to
sharpen the competitive edge of American business:
-- first, strengthening small business, by cutting taxes,
ensuring that credit is available, and by lifting the dead weight
of government regulation;
-- second, supporting civilian R&D, by bringing the
development, production and marketing of technology closer
to the consumer;
-- and third, reforming our costly legal system, which mires
even conscientious businesses and individuals in a swamp of
frivolous lawsuits. My product liability reform and Access to
Justice Act will drain the swamp.
14
Frankly, passage of these bills won't be easy. Trial
lawyers are a powerful vested interest -- well-represented in
Congress and high on the list of political contributors, as my
opponent well knows. But America will never lead the world in
the 21st Century until we learn to sue each other less and care
for each other more.
The most competitive companies in the coming decades will be
those that most involve their workers in the business at hand.
Working men and women will want to know that they can enjoy both
economic opportunity and security. That is the fourth component
of my agenda: Promoting Economic Security.
Again, common sense shows the way: True security will come
only by developing individual capability, not dependency. And
that independence, in turn, comes through the private sector, not
the government.
Government's role will be to ease the individual's
adjustment to a fast-changing marketplace.
This means, in practice, a wider and more flexible range of
job training and placement services -- for both the young and
old, the blue and white-collar worker, and particularly during
the present period, workers from our defense industries.
The pace of the new economy makes new job training
approaches necessary: most workers will have more than one
employer, often more than one career, over the course of their
working lives. This fact raises concerns as well about workers'
ability to preserve their pensions as they make those changes.
15
This summer I signed a law to increase pension portability, but
there is still much to do.
Economic security requires as well a major reform of our
health care system. The present system's uncontrollable costs
and inaccessible coverage is the cause of great unease, even
fear, throughout our economy.
My reforms, which I have outlined in detail elsewhere,
addresses the roots of these problems while preserving and
building on our system's strengths -- our state-of-the-art care,
openness to innovation, and diversity of consumer choice. Taken
together, my reforms would cut health care costs by $394 billion.
In health care, as in so many issues this year, we stand at
a crossroads. The path my opponents have chosen would place a
full 13 percent of our economy under the control of the federal
government -- meaning more bureaucracy, rationed care,
inefficient delivery of services, and, in the end, higher costs.
Let common sense be our guide: We must enhance competition
and market forces, not restrict them; we must preserve individual
choice, not hand decision-making over to centralized
bureaucracies; we must reduce the burden on employers and
employees, not bury them in a tide of new taxes and government
regulations.
Job training, retirement security, affordable health care:
When combined with a new system of education and entrepreneurial,
competitive business, we can offer genuine economic security to
our working men and women.
16
The programs I've outlined are based on the principles that
will empower all Americans to make their own choices and better
their lives. But I believe we need to do more for some of our
citizens who have been left behind. That is the sixth component
where's
of my agenda: Leaving No One Behind.
fifth
The American Dream is nothing more or less than the belief
that all Americans can make a better life for their children.
The dream has made us the most dynamic society in the world; and
in the new century that dynamism will be essential to outpace the
economic competition. We can only turn it to our full advantage
if every American has a shot at making good on the dream.
I reject the shopworn logic that sees poverty as a simple
lack of income -- a kind of economic shortfall that can be
replaced with a government check. A conservative philosophy of
empowerment must have at its foundation the creation of
character, through the ownership of property and the dignity of
work. That means sweeping away the nightmare of crime from our
cities, building a core of property owners, creating business
incentives, and making individual discipline and self-reliance
the goal of all our programs. The human capital unleashed in
this way will do much to drive us forward into the 21st Century.
I call the final component of my Agenda -- "Rightsizing
Government."
You'll recognize that I take the term from the business
world -- which has a lot to teach those of us in government. At
a time when companies across the country have been restructuring,
17
cutting fat, increasing efficiency -- all to prepare for the
economic competition of tomorrow -- the federal government faces
an obligation to do the same.
Today the federal government spends nearly twenty-four cents
of every dollar of the nation's income. That figure provides
vivid proof of what I have often said: Government is too big and
it spends too much.
A bloated federal government, serving itself seconds rather
than serving the people first, will weigh us down in the economic
race of a new era.
The Agenda I publish today contains specific proposals to
This
(on
cut the fat: caps on the growth in mandatory spending and a
freeze on domestic spending; a balanced budget amendment and a
bended
ad
line-item veto; and a new mechanism -- a check-off box on tax
returns to give taxpayers the power to cut the deficit
themselves.
The size and structure of government are relics of a
different age -- artifacts more suited to the dilemmas of fifty
years ago than the problems of today. An American renewal will
require a streamlined government -- consolidating agencies,
HAVE
tightening budgets, and cutting the salaries of highly paid
federal employees.
proposels Catby...?
Unlike my opponent, I do not believe the American people are
undertaxed. Quite the opposite: I am committed to cutting taxes
across the board. Let me offer an illustration of what we could
do: If Congress had acted on the $130 billion in specific
18
spending cuts I have already proposed, we could cut income tax
rates by one percent across the board; reduce the small business
tax rate from 15 percent to 10 percent, and reduce the tax on
capital gains.
That is the direction I propose we go: to tax less and spend
less; and to redirect our current spending to serve the interests
of all Americans.
I honestly believe that this is the way -- the only way --
to control the size of the federal government. The facts are
painful but plain: For Congressmen, spending is power. And they
will exercise that power until they have spent every last dime
they can squeeze from the working men and women of America. It's
as simple as this: Raising taxes won't cut the deficit.
Here, then, is my Agenda for American Renewal. It comes at
a time unique in our history, a turning point, a moment when one
era is passing away and another is being born.
I intend to fight for this Agenda, to fight as hard as I can
to get as much as I can, and then I'm going to come back for
more. If Congress balks, I'll move forward anyway -- just as I
have done with education and welfare reform. I'll work with the
governors, with state and local governments, with the private
sector -- with anyone who shares the urge to renew our country.
With the close of the Cold War we can target peace,
prosperity and promise at home. The American people want that.
The American people deserve it.
19
At the same time, Americans recognize that the great events
of recent years have shaken the world. If we are to succeed, as
a nation and a people, if we are to hold true to all that has
made America the last, best hope of man on earth, then our
renewal at home must enable us to make the 21st Century yet
another American Century.
My Agenda draws together our people and our government to
meet this challenge. We will create a $10 trillion economy. We
will renew America. We will win the peace.
I want America to seize this moment. I want to stimulate
entrepreneurial capitalism, not punish it; I want to empower
people to make their own choices, not yoke them to new
bureaucracies. I want a government that spends less and taxes
less. And I will fight without hesitation for a free flow of
trade and capital and ideas around the world -- bècause Americans
compete, never retreat.
I know times have been difficult for many Americans. The
world we knew as children -- no matter your age -- will never be
the same. America will change -- that is our destiny; how it
will change will soon be decided.
I ask, when you step into that voting booth, to please
consider carefully whose agenda for change best fits America's
principles, our national experience, and our hopes for lasting
peace and prosperity.
XXX
EXECUTIVE OFFICE OF THE PRESIDENT
09-Sep-1992 10:39am
TO:
Claire F. Turney
FROM:
Edward J. Walters
Office of Communications
SUBJECT: Detroit Speech
Fact-check change on Detroit: the President speaks of Public
Safety Equipment, a St. Louis light manufacturer, who exports to
66 countries. That should be 48 (PSE was my speech).
September 8, 1992
11:00 p.m.
AGENDA
PRESIDENTIAL REMARKS: DETROIT ECONOMIC CLUB
SEPTEMBER 10, 1992
DETROIT, MICHIGAN
Good morning, everyone. (Acknowledgments)
This morning I am releasing an Agenda for American Renewal.
And I've come here today to introduce it to you and the nation.
My agenda diagnoses the economic problems our nation faces,
lays out the principles that should guide us in the years ahead,
and explains the integrated approach I am pursuing to meet the
challenge.
Over the past weeks I have been discussing elements of my
economic agenda, and in the weeks ahead I will be expanding on
those and other ideas. The document I am releasing today shows
how the pieces fit together.
But let's begin this morning by stepping back, taking stock
of where we are as a great nation in the broader sweep of
history.
The American people have just completed the greatest mission
in the lifetime of our country -- the triumph of democratic
capitalism over imperial communism.
Today, this year, for the first time since December 1941,
the United States is not engaged in a war, hot or cold.
Throughout history, at the close of prolonged and costly
wars, victors have confronted the problem of securing a new basis
for peace and prosperity. The American people recognize that we
stand at such a watershed.
2
They sense the epic changes at work in the world and the
economy, the uneasiness that stirs the democracies who served as
our partners in the long struggle.
They feel the uneasiness in their own homes and communities;
and they see the difficulties of those who have felt change most
directly.
And they know that while we face an era of great
opportunity, we face great risks as well -- if we fail to make
the right choices, if we fail to engage this new world wisely.
But America has always possessed unique powers, and foremost
among them is the power of regeneration -- to transform anxiety
into opportunity. only in America do we have the people, the
talents -- the principles and ideals -- to fully embrace the
world that opens before us.
For America to be safe and strong, we must meet the defining
challenge of the 1990s: to win the economic competition -- to win
the peace.
We must be a military superpower, an economic superpower,
and an export superpower.
My Agenda for Renewal asks that we look forward -- to open
new markets, prepare our people to work, strengthen our families,
-- to save and invest -- so that we can win.
Our renewal depends on economic growth -- but growth not for
the few at the expense of the many, not for the present at the
expense of the future.
3
In our country we have always prized an entrepreneurial
capitalism that grows from the bottom up, not the top down, a
prosperity that begins on Main Street and extends to Wall Street
-- not the other way around.
We have never been seduced by the view my opponent offers -
- of a government that accumulates capital by taxing it and
borrowing it from the people, and spending it according to an
industrial policy fashioned from the latest academic theories.
My agenda is for an inclusive, not an exclusive America --
and surely not for a reclusive one. My international economic
and trade strategy will guarantee our position as an export
superpower, extending our global economic reach in tandem with
our security presence -- to stretch beyond our borders so that we
can create more jobs within them.
At the same time, we need to foster at home the capabilities
that will keep us in the lead: radical changes in our education
system to prepare our children for a constantly changing
workplace; incentives for entrepreneurs and new technologies to
sharpen our competitive edge; job training and health care reform
to promote the economic security of our working men and women;
and new approaches for reaching out to those who have been left
behind, since in the century ahead we will need the aspirations
and energy of every American.
And finally, because our greatest strengths flow not from
government but from the personal initiative and energy of free
4
men and women, my agenda aims to check the growth of government,
and, in some important ways, to reverse it.
Fitted together, each overarching and underpinning the
other, the components of this agenda should renew America
according to her most cherished principles.
And this renewed America will be empowered toward a grand
goal: to nearly double the size of our economy, to $10 trillion,
by the early years of this century.
To place my agenda in a larger context, let me turn briefly
to five profound changes now at work in our economy. When
Americans gather around the kitchen table at night, and talk
about how they'll meet a mortgage, or pay the doctor's bill,
they're feeling these changes in their lives. And before the
changes have run their course, they will have forever altered the
way Americans buy and sell, work and create.
The first great change in our economy is ironically caused
by our very success in ending the Cold War. In the short run,
reductions in defense spending have meant painful lay-offs in
many industries, and we are taking steps to ease this transition.
But in the medium and long run, reductions in defense spending
will free up priceless skills and technologies for peacetime
growth.
Second, most of our industries are transforming themselves
from the old-style hierarchical organizations to so-called
flattened pyramids, emphasizing a skills-based workforce, "lean
production," and shorter product cycles. From castings to
5
computers, this is a revolution as dramatic as the one made
earlier this century, when Henry Ford led the country from craft-
based production to mass manufacturing.
While these changes are essential to maintaining our
competitive edge, they've come with a cost -- lay-offs and
cutbacks among both white- and blue-collar workers, who must
worry about their health care and pensions. These hard-working
people need reassurance -- not only about their economic
security, but about preserving the sense of self-worth that only
work can provide.
The third change: while the 1980s brought us the greatest
peacetime expansion in our history, the boom also led too many
companies and too many households to take on too much debt.
We have been paying down that debt -- and lower interest
rates have helped us do it. The process is largely over, but
consumers and companies remain cautious.
-
The fourth change involves our financial system. We entered
the '80s with a banking system designed 50 years earlier, a relic
in an era when billions of investment dollars can cross borders
at the speed of light.
The late '70s threatened this anachronism with record
interest and inflation rates -- as well as newer, more
competitive financial services. The less efficient institutions
could not survive, obligating the federal government to protect
the savings of millions of Americans.
6
This process, too, is nearing its end. The result will be a
more flexible and efficient financial system. But for now,
lenders are cautious and, despite low rates, small businesses
still find access to credit difficult.
The most far-reaching of these five changes is the emergence
of a global economy. No nation is an island today. One out of
every six manufacturing jobs is directly tied to exports. The
crops sown from one out of every three acres of farmland is sold
abroad.
Consider three implications of the global economy: One, when
growth slows abroad, as it has recently, our own growth slows as
well. Two, America will only grow in the next century if it can
compete globally -- in every part of the world. And three, we
must seize every opportunity to open new markets, particularly
those with the greatest potential for expansion.
Now, in drafting an agenda for America's future, we had to
assess our strengths as well as our weaknesses. Conveniently,
the other side has discovered many weaknesses, very few
strengths. Of course, they might find temporary political gain
in portraying an America past her prime and over the hill. But
they have no more right to argue, for partisan purposes, that our
economy is weaker than it is, than I have to underestimate our
problems.
Our strengths are real. The Misery Index -- the sum of
inflation and unemployment -- is 10.8 percent today, down from
19.6 percent in 1980.
7
Inflation stands at about three percent.
Interest rates are at a twenty year low.
The purchasing power of Americans gives us the highest
standard of living in the world.
We enjoy the highest home ownership rate of all major
industrialized countries.
We send 68 percent of our children on to higher education -
- more than any other country -- and well above Germany's 32
percent and Japan's 30 percent.
And with 5 percent of the world's population, we produce 25
percent of the world's total output.
I could go on, but I do not mean to suggest that all is well
-- that we do not need to lead and manage the changes
transforming our economy. But you can't chart the stars if you
think the sky is falling. Over the past 12 years we have almost
doubled the size of our economy. It's as if we created two extra
economies the size of Germany's from scratch.
How will we meet our goals? Before outlining the specifics
of my agenda, allow me to set out four principles. I believe
these principles are deeply embedded in the American creed -- for
the principles that must guide change are the principles that
must never change.
First, I believe America is a nation of special individuals,
not special interests. And individuals, in turn, draw strength
and protection from families and communities, not the Government.
8
Second, because the individual, not the government, is the
basis of a free society, an agenda for economic growth must
adhere to certain fundamentals: lower tax rates, limits on
Government spending, sound money, greater competition, less
economic regulation, and more open trade.
Third, government can build on these fundamentals by
offering opportunity and hope for individuals, families, and
communities. There is a conservative agenda for helping people,
for responding to their needs, by giving them the means, the
capabilities, and the confidence to make the decisions that
matter in life.
Finally, all our policies must be brought together
effectively if we are to prosper as a people and succeed as a
nation. Just as barriers between countries and companies fall in
the global economy, so too the traditional distinctions between
foreign and domestic, economic and security policies look
increasingly artificial. Our aim must be to execute our policies
as a unified program to make America secure and strong.
Therefore my Agenda for American Renewal calls for action on
six interconnected fronts. We face complex problems; no single
solution will suffice. The whole of our agenda will be greater
than the sum of its parts.
First, Challenging the World. During the Cold War, we built
a global security structure underpinned by military alliances
across the Atlantic and Pacific. In the same way, the post-Cold
War era requires a strategic economic and trade policy -- global
9
in scope, and underpinned by our status as an economic and export
superpower.
We are uniquely positioned to achieve this goal. As the
largest fully integrated market in the world, we wield leverage
with other countries that want access to our market.
As both a Pacific and a European power, we are tied to the
largest and most rapidly growing economies across both oceans.
And as the strongest nation in our hemisphere, we are looked
to for leadership by free economies emerging from Chile to
Mexico.
The same holds true for the newly born economies of Eastern
Europe and the former Soviet Union, where our values, our
products, even our language, carry a unique appeal. In Moscow
these days, the lines at McDonalds are longer than the lines at
Lenin's Tomb.
The key to America's growth, expansion, and innovation has
always been our openness to trade, investment, ideas, and people.
As this openness is at last being reciprocated around the world,
we find ourselves again at a special advantage.
The next steps in my strategic trade policy are to secure
Congressional approval of the North American Free Trade Agreement
and to complete the global trade negotiations, creating American
jobs and expanding the pool of customers for American products.
Let me emphasize: these agreements are steps, not ends in
themselves.
10
Our goal is to develop a strategic network of free trade
agreements across the Atlantic and the Pacific and in our own
hemisphere -- with Latin America; with Poland, Hungary and
Czechoslovakia; and countries across the Pacific.
As these external barriers fall, I believe we can reduce
internal barriers to competition as well -- in North America,
Western Europe, Japan, and elsewhere. Greater competition will
encourage entrepreneurial capitalism at the expense of government
power and entrenched interests, spurring still greater economic
growth.
Traveling around the country I have seen it happen already -
- particularly in our small businesses, as they reorient
themselves toward exports and international competition. A
couple of weeks ago, in St. Louis, I visited Public Safety
Equipment, Inc., a manufacturer of sirens, light-bars and other
safety devices. The president of Public Safety told me that a
few years ago, they recognized the time was long past when they
could sell their products in the fifty states and leave it at
that. So they took on the world. Now 35 percent of what they
make is sold in 66 countries.
Public Safety, and the hundreds of thousands of companies
like it, offer a glimpse into the future I envision for all
American business.
But a business is only as efficient, as resilient and smart,
as the people who keep its books and build its products and make
its strategy. Materials, machines, and methods will come and go,
11
but the American worker will remain the key to our economic
security. That brings me to the second component of my agenda:
Preparing Our Children.
The workplace of the 21st Century will be constantly
changing. We must prepare the American people for a lifetime of
learning, to keep a step ahead of that process of change.
Developed nations need developing minds.
The burden will fall on our educational system. As in the
past, education should be the ladder that children of modest
means can climb to better themselves.
Our current school system is not meeting these needs.
Designed for the 19th Century, it will collapse under the
pressures of the 21st. And it must be said: our educational
establishment is caught in the same time warp, where standing
still means falling behind.
Money alone is not the answer -- the United States already
spends more per pupil than any other country but Switzerland.
The answer is a radical overhaul of the system itself. If we
want to change our country, we've got to change our schools.
And the catalyst for change -- the one change that drives
all others -- is school choice, giving all parents the means and
freedom to choose which schools will best serve their children.
Competition is the principle that must underlie education reform.
And competition will not work unless parents are allowed to
choose their children's schools -- whether it's the public school
across town or the parochial school across the street.
12
Wealthy families already have this choice for their
children. Many people you saw at the Democratic National
Convention have choice for their children. Why shouldn't you
have choice for your children?
Consider one statistic: In Chicago, 47 percent of public
school teachers send their children to private schools. Clearly
they know something about monopoly education my opponent doesn't.
Our different approaches to education reform reveal the
great divide between my opponent and me. You will see the same
contrast in child care, health care, and a host of other issues.
The opposition prefers uniformity to variety and choice, relying
on government bureaucracies to offer "one-size-fits-all service."
I don't want to pull everyone down to make them equal. I want to
give everyone the tools to climb as high as they can dream.
Having prepared our children for the world of work, the
question remains what kind of work they will do. The third
component of my agenda for renewal is therefore: Sharpening
Businesses' Competitive Edge. Our ultimate success as an
economic superpower is dependent on the performance of our
private businesses -- on our success in encouraging
entrepreneurial capitalism.
The free market does not operate according to academic
theory or abstract industrial policies. It operates on common
sense. I learned my economics the way most of you did -- a lot
of late nights sweating over a balance sheet, trying to meet a
payroll.
13
I saw that if people are allowed to keep more of what they
produce, they will produce more than they can use. The remainder
is called capital.
When capital is taxed lightly, it becomes abundant. When it
is taxed heavily, it becomes scarce -- available only to those at
the top, who need it least of all. That's not what I want.
If capital were more abundant, however, labor would become
more scarce. Wages would rise, unemployment lines would shrink.
That is what I want.
That's why I want enterprise zones in our inner cities and
rural areas. That's why I want to make the R & D tax credit
permanent. And that's why I want to cut the capital gains tax
and index it for inflation.
Those are the fundamentals. I also see three other ways to
sharpen the competitive edge of American business:
-- first, strengthening small business, by cutting taxes,
ensuring that credit is available, and by lifting the dead weight
of government regulation;
-- second, supporting civilian R&D, by bringing the
development, production and marketing of technology closer
to the consumer;
-- and third, reforming our costly legal system, which mires
even conscientious businesses and individuals in a swamp of
frivolous lawsuits. My product liability reform and Access to
Justice Act will drain the swamp.
14
Frankly, passage of these bills won't be easy. Trial
lawyers are a powerful vested interest -- well-represented in
Congress and high on the list of political contributors, as my
opponent well knows. But America will never lead the world in
the 21st Century until we learn to sue each other less and care
for each other more.
The most competitive companies in the coming decades will be
those that most involve their workers in the business at hand.
Working men and women will want to know that they can enjoy both
economic opportunity and security. That is the fourth component
of my agenda: Promoting Economic Security.
Again, common sense shows the way: True security will come
only by developing individual capability, not dependency. And
that independence, in turn, comes through the private sector, not
the government.
Government's role will be to ease the individual's
adjustment to a fast-changing marketplace.
This means, in practice, a wider and more flexible range of
job training and placement services -- for both the young and
old, the blue and white-collar worker, and particularly during
the present period, workers from our defense industries.
The pace of the new economy makes new job training
approaches necessary: most workers will have more than one
employer, often more than one career, over the course of their
working lives. This fact raises concerns as well about workers'
ability to preserve their pensions as they make those changes.
15
This summer I signed a law to increase pension portability, but
there is still much to do.
Economic security requires as well a major reform of our
health care system. The present system's uncontrollable costs
and inaccessible coverage is the cause of great unease, even
fear, throughout our economy.
My reforms, which I have outlined in detail elsewhere,
addresses the roots of these problems while preserving and
building on our system's strengths -- our state-of-the-art care,
openness to innovation, and diversity of consumer choice. Taken
together, my reforms would cut health care costs by $394 billion.
In health care, as in so many issues this year, we stand at
a crossroads. The path my opponents have chosen would place a
full 13 percent of our economy under the control of the federal
government -- meaning more bureaucracy, rationed care,
inefficient delivery of services, and, in the end, higher costs.
Let common sense be our guide: We must enhance competition
and market forces, not restrict them; we must preserve individual
choice, not hand decision-making over to centralized
bureaucracies; we must reduce the burden on employers and
employees, not bury them in a tide of new taxes and government
regulations.
Job training, retirement security, affordable health care:
When combined with a new system of education and entrepreneurial,
competitive business, we can offer genuine economic security to
our working men and women.
16
The programs I've outlined are based on the principles that
will empower all Americans to make their own choices and better
their lives. But I believe we need to do more for some of our
citizens who have been left behind. That is the sixth component
of my agenda: Leaving No One Behind.
The American Dream is nothing more or less than the belief
that all Americans can make a better life for their children.
The dream has made us the most dynamic society in the world; and
in the new century that dynamism will be essential to outpace the
economic competition. We can only turn it to our full advantage
if every American has a shot at making good on the dream.
I reject the shopworn logic that sees poverty as a simple
lack of income -- a kind of economic shortfall that can be
replaced with a government check. A conservative philosophy of
empowerment must have at its foundation the creation of
character, through the ownership of property and the dignity of
work. That means sweeping away the nightmare of crime from our
cities, building a core of property owners, creating business
incentives, and making individual discipline and self-reliance
the goal of all our programs. The human capital unleashed in
this way will do much to drive us forward into the 21st Century.
I call the final component of my Agenda -- "Rightsizing
Government."
You'll recognize that I take the term from the business
world -- which has a lot to teach those of us in government. At
a time when companies across the country have been restructuring,
17
cutting fat, increasing efficiency -- all to prepare for the
economic competition of tomorrow -- the federal government faces
an obligation to do the same.
Today the federal government spends nearly twenty-four cents
of every dollar of the nation's income. That figure provides
vivid proof of what I have often said: Government is too big and
it spends too much.
A bloated federal government, serving itself seconds rather
than serving the people first, will weigh us down in the economic
race of a new era.
The Agenda I publish today contains specific proposals to
cut the fat: caps on the growth in mandatory spending and a
freeze on domestic spending; a balanced budget amendment and a
line-item veto; and a new mechanism -- a check-off box on tax
returns -- to give taxpayers the power to cut the deficit
themselves.
The size and structure of government are relics of a
different age -- artifacts more suited to the dilemmas of fifty
years ago than the problems of today. An American renewal will
require a streamlined government -- consolidating agencies,
tightening budgets, and cutting the salaries of highly paid
federal employees.
Unlike my opponent, I do not believe the American people are
undertaxed. Quite the opposite: I am committed to cutting taxes
across the board. Let me offer an illustration of what we could
do: If Congress had acted on the $130 billion in specific
18
spending cuts I have already proposed, we could cut income tax
rates by one percent across the board; reduce the small business
tax rate from 15 percent to 10 percent, and reduce the tax on
capital gains.
That is the direction I propose we go: to tax less and spend
less; and to redirect our current spending to serve the interests
of all Americans.
I honestly believe that this is the way -- the only way --
to control the size of the federal government. The facts are
painful but plain: For Congressmen, spending is power. And they
will exercise that power until they have spent every last dime
they can squeeze from the working men and women of America. It's
as simple as this: Raising taxes won't cut the deficit.
Here, then, is my Agenda for American Renewal. It comes at
a time unique in our history, a turning point, a moment when one
era is passing away and another is being born.
I intend to fight for this Agenda, to fight as hard as I can
to get as much as I can, and then I'm going to come back for
more. If Congress balks, I'll move forward anyway -- just as I
have done with education and welfare reform. I'll work with the
governors, with state and local governments, with the private
sector -- with anyone who shares the urge to renew our country.
With the close of the Cold War we can target peace,
prosperity and promise at home. The American people want that.
The American people deserve it.
19
At the same time, Americans recognize that the great events
of recent years have shaken the world. If we are to succeed, as
a nation and a people, if we are to hold true to all that has
made America the last, best hope of man on earth, then our
renewal at home must enable us to make the 21st Century yet
another American Century.
My Agenda draws together our people and our government to
meet this challenge. We will create a $10 trillion economy.
We
will renew America. We will win the peace.
I want America to seize this moment. I want to stimulate
entrepreneurial capitalism, not punish it; I want to empower
people to make their own choices, not yoke them to new
bureaucracies. I want a government that spends less and taxes
less. And I will fight without hesitation for a free flow of
trade and capital and ideas around the world -- because Americans
compete, never retreat.
I know times have been difficult for many Americans. The
world we knew as children -- no matter your age -- will never be
the same. America will change -- that is our destiny; how it
will change will soon be decided.
I ask, when you step into that voting booth, to please
consider carefully whose agenda for change best fits America's
principles, our national experience, and our hopes for lasting
peace and prosperity.
XXX
September 8, 1992
11:00 p.m.
AGENDA
PRESIDENTIAL REMARKS: DETROIT ECONOMIC CLUB
SEPTEMBER 10, 1992
DETROIT, MICHIGAN
Good morning, everyone. (Acknowledgments)
This morning I am releasing an Agenda for American Renewal.
And I've come here today to introduce it to you and the nation.
My agenda diagnoses the economic problems our nation faces,
lays out the principles that should guide us in the years ahead,
and explains the integrated approach I am pursuing to meet the
challenge.
Over the past weeks I have been discussing elements of my
economic agenda, and in the weeks ahead I will be expanding on
those and other ideas. The document I am releasing today shows
how the pieces fit together.
But let's begin this morning by stepping back, taking stock
of where we are as a great nation in the broader sweep of
history.
The American people have just completed the greatest mission
in the lifetime of our country -- the triumph of democratic
capitalism over imperial communism.
Today, this year, for the first time since December 1941,
the United States is not engaged in a war, hot or cold.
Throughout history, at the close of prolonged and costly
wars, victors have confronted the problem of securing a new basis
for peace and prosperity. The American people recognize that we
stand at such a watershed.
2
They sense the epic changes at work in the world and the
economy, the uneasiness that stirs the democracies who served as
our partners in the long struggle.
They feel the uneasiness in their own homes and communities;
and they see the difficulties of those who have felt change most
directly.
And they know that while we face an era of great
opportunity, we face great risks as well -- if we fail to make
the right choices, if we fail to engage this new world wisely.
But America has always possessed unique powers, and foremost
among them is the power of regeneration -- to transform anxiety
into opportunity. Only in America do we have the people, the
talents -- the principles and ideals -- to fully embrace the
world that opens before us.
For America to be safe and strong, we must meet the defining
challenge of the 1990s: to win the economic competition -- to win
the peace.
We must be a military superpower, an economic superpower,
and an export superpower.
My Agenda for Renewal asks that we look forward -- to open
new markets, prepare our people to work, strengthen our families,
-- to save and invest -- so that we can win.
Our renewal depends on economic growth -- but growth not for
the few at the expense of the many, not for the present at the
expense of the future.
3
In our country we have always prized an entrepreneurial
capitalism that grows from the bottom up, not the top down, a
prosperity that begins on Main Street and extends to Wall Street
-- not the other way around.
We have never been seduced by the view my opponent offers -
- of a government that accumulates capital by taxing it and
borrowing it from the people, and spending it according to an
industrial policy fashioned from the latest academic theories.
My agenda is for an inclusive, not an exclusive America --
and surely not for a reclusive one. My international economic
and trade strategy will guarantee our position as an export
superpower, extending our global economic reach in tandem with
our security presence -- to stretch beyond our borders so that we
can create more jobs within them.
At the same time, we need to foster at home the capabilities
that will keep us in the lead: radical changes in our education
system to prepare our children for a constantly changing
workplace; incentives for entrepreneurs and new technologies to
sharpen our competitive edge; job training and health care reform
to promote the economic security of our working men and women;
and new approaches for reaching out to those who have been left
behind, since in the century ahead we will need the aspirations
and energy of every American.
And finally, because our greatest strengths flow not from
government but from the personal initiative and energy of free
4
men and women, my agenda aims to check the growth of government,
and, in some important ways, to reverse it.
Fitted together, each overarching and underpinning the
other, the components of this agenda should renew America
according to her most cherished principles.
And this renewed America will be empowered toward a grand
goal: to nearly double the size of our economy, to $10 trillion,
by the early years of this century.
To place my agenda in a larger context, let me turn briefly
to five profound changes now at work in our economy. When
Americans gather around the kitchen table at night, and talk
about how they' 11 meet a mortgage, or pay the doctor's bill,
they're feeling these changes in their lives. And before the
changes have run their course, they will have forever altered the
way Americans buy and sell, work and create.
The first great change in our economy is ironically caused
by our very success in ending the Cold War. In the short run,
reductions in defense spending have meant painful lay-offs in
many industries, and we are taking steps to ease this transition.
But in the medium and long run, reductions in defense spending
will free up priceless skills and technologies for peacetime
growth.
Second, most of our industries are transforming themselves
from the old-style hierarchical organizations to so-called
flattened pyramids, emphasizing a skills-based workforce, "lean
production," and shorter product cycles. From castings to
5
computers, this is a revolution as dramatic as the one made
earlier this century, when Henry Ford led the country from craft-
based production to mass manufacturing.
While these changes are essential to maintaining our
competitive edge, they've come with a cost -- lay-offs and
cutbacks among both white- and blue-collar workers, who must
worry about their health care and pensions. These hard-working
people need reassurance -- not only about their economic
security, but about preserving the sense of self-worth that only
work can provide.
The third change: while the 1980s brought us the greatest
peacetime expansion in our history, the boom also led too many
companies and too many households to take on too much debt.
We have been paying down that debt -- and lower interest
rates have helped us do it. The process is largely over, but
consumers and companies remain cautious.
The fourth change involves our financial system. We entered
the '80s with a banking system designed 50 years earlier, a relic
in an era when billions of investment dollars can cross borders
at the speed of light.
The late '70s threatened this anachronism with record
interest and inflation rates -- as well as newer, more
competitive financial services. The less efficient institutions
could not survive, obligating the federal government to protect
the savings of millions of Americans.
6
This process, too, is nearing its end. The result will be a
more flexible and efficient financial system. But for now,
lenders are cautious and, despite low rates, small businesses
still find access to credit difficult.
The most far-reaching of these five changes is the emergence
of a global economy. No nation is an island today. One out of
every six manufacturing jobs is directly tied to exports. The
crops sown from one out of every three acres of farmland is sold
abroad.
Consider three implications of the global economy: One, when
growth slows abroad, as it has recently, our own growth slows as
well. Two, America will only grow in the next century if it can
compete globally -- in every part of the world. And three, we
must seize every opportunity to open new markets, particularly
those with the greatest potential for expansion.
Now, in drafting an agenda for America's future, we had to
assess our strengths as well as our weaknesses. Conveniently,
the other side has discovered many weaknesses, very few
strengths. Of course, they might find temporary political gain
in portraying an America past her prime and over the hill. But
they have no more right to argue, for partisan purposes, that our
economy is weaker than it is, than I have to underestimate our
problems.
Our strengths are real. The Misery Index -- the sum of
inflation and unemployment -- is 10.8 percent today, down from
19.6 percent in 1980.
7
Inflation stands at about three percent.
Interest rates are at a twenty year low.
The purchasing power of Americans gives us the highest
standard of living in the world.
We enjoy the highest home ownership rate of all major
industrialized countries.
We send 68 percent of our children on to higher education -
- more than any other country -- and well above Germany's 32
percent and Japan's 30 percent.
And with 5 percent of the world's population, we produce 25
percent of the world's total output.
I could go on, but I do not mean to suggest that all is well
-- that we do not need to lead and manage the changes
transforming our economy. But you can't chart the stars if you
think the sky is falling. Over the past 12 years we have almost
doubled the size of our economy. It's as if we created two extra
economies the size of Germany's from scratch.
How will we meet our goals? Before outlining the specifics
of my agenda, allow me to set out four principles. I believe
these principles are deeply embedded in the American creed -- for
the principles that must guide change are the principles that
must never change.
First, I believe America is a nation of special individuals,
not special interests. And individuals, in turn, draw strength
and protection from families and communities, not the Government.
8
Second, because the individual, not the government, is the
basis of a free society, an agenda for economic growth must
adhere to certain fundamentals: lower tax rates, limits on
Government spending, sound money, greater competition, less
economic regulation, and more open trade.
Third, government can build on these fundamentals by
offering opportunity and hope for individuals, families, and
communities. There is a conservative agenda for helping people,
for responding to their needs, by giving them the means, the
capabilities, and the confidence to make the decisions that
matter in life.
Finally, all our policies must be brought together
effectively if we are to prosper as a people and succeed as a
nation. Just as barriers between countries and companies fall in
the global economy, so too the traditional distinctions between
foreign and domestic, economic and security policies look
increasingly artificial. Our aim must be to execute our policies
as a unified program to make America secure and strong.
Therefore my Agenda for American Renewal calls for action on
six interconnected fronts. We face complex problems; no single
solution will suffice. The whole of our agenda will be greater
than the sum of its parts.
First, Challenging the World. During the Cold War, we built
a global security structure underpinned by military alliances
across the Atlantic and Pacific. In the same way, the post-Cold
War era requires a strategic economic and trade policy -- global
9
in scope, and underpinned by our status as an economic and export
superpower.
We are uniquely positioned to achieve this goal. As the
largest fully integrated market in the world, we wield leverage
with other countries that want access to our market.
As both a Pacific and a European power, we are tied to the
largest and most rapidly growing economies across both oceans.
And as the strongest nation in our hemisphere, we are looked
to for leadership by free economies emerging from Chile to
Mexico.
The same holds true for the newly born economies of Eastern
Europe and the former Soviet Union, where our values, our
products, even our language, carry a unique appeal. In Moscow
these days, the lines at McDonalds are longer than the lines at
Lenin's Tomb.
The key to America's growth, expansion, and innovation has
always been our openness to trade, investment, ideas, and people.
As this openness is at last being reciprocated around the world,
we find ourselves again at a special advantage.
The next steps in my strategic trade policy are to secure
Congressional approval of the North American Free Trade Agreement
and to complete the global trade negotiations, creating American
jobs and expanding the pool of customers for American products.
Let me emphasize: these agreements are steps, not ends in
themselves.
10
Our goal is to develop a strategic network of free trade
agreements across the Atlantic and the Pacific and in our own
hemisphere -- with Latin America; with Poland, Hungary and
Czechoslovakia; and countries across the Pacific.
As these external barriers fall, I believe we can reduce
internal barriers to competition as well -- in North America,
Western Europe, Japan, and elsewhere. Greater competition will
encourage entrepreneurial capitalism at the expense of government
power and entrenched interests, spurring still greater economic
growth.
Traveling around the country I have seen it happen already -
- particularly in our small businesses, as they reorient
themselves toward exports and international competition. A
couple of weeks ago, in St. Louis, I visited Public Safety
Equipment, Inc., a manufacturer of sirens, light-bars and other
safety devices. The president of Public Safety told me that a
few years ago, they recognized the time was long past when they
could sell their products in the fifty states and leave it at
that. So they took on the world. Now 35 percent of what they
make is sold in 66 countries.
Public Safety, and the hundreds of thousands of companies
like it, offer a glimpse into the future I envision for all
American business.
But a business is only as efficient, as resilient and smart,
as the people who keep its books and build its products and make
its strategy. Materials, machines, and methods will come and go,
11
but the American worker will remain the key to our economic
security. That brings me to the second component of my agenda:
Preparing Our Children.
The workplace of the 21st Century will be constantly
changing. We must prepare the American people for a lifetime of
learning, to keep a step ahead of that process of change.
Developed nations need developing minds.
The burden will fall on our educational system. As in the
past, education should be the ladder that children of modest
means can climb to better themselves.
Our current school system is not meeting these needs.
Designed for the 19th Century, it will collapse under the
pressures of the 21st. And it must be said: our educational
establishment is caught in the same time warp, where standing
still means falling behind.
Money alone is not the answer -- the United States already
spends more per pupil than any other country but Switzerland.
The answer is a radical overhaul of the system itself. If we
want to change our country, we've got to change our schools.
And the catalyst for change -- the one change that drives
all others -- is school choice, giving all parents the means and
freedom to choose which schools will best serve their children.
Competition is the principle that must underlie education reform.
And competition will not work unless parents are allowed to
choose their children's schools -- whether it's the public school
across town or the parochial school across the street.
12
Wealthy families already have this choice for their
children. Many people you saw at the Democratic National
Convention have choice for their children. Why shouldn't you
have choice for your children?
Consider one statistic: In Chicago, 47 percent of public
school teachers send their children to private schools. Clearly
they know something about monopoly education my opponent doesn't.
Our different approaches to education reform reveal the
great divide between my opponent and me. You will see the same
contrast in child care, health care, and a host of other issues.
The opposition prefers uniformity to variety and choice, relying
on government bureaucracies to offer "one-size-fits-all service."
I don't want to pull everyone down to make them equal. I want to
give everyone the tools to climb as high as they can dream.
Having prepared our children for the world of work, the
question remains what kind of work they will do. The third
component of my agenda for renewal is therefore: Sharpening
Businesses' Competitive Edge. Our ultimate success as an
economic superpower is dependent on the performance of our
private businesses -- on our success in encouraging
entrepreneurial capitalism.
The free market does not operate according to academic
theory or abstract industrial policies. It operates on common
sense. I learned my economics the way most of you did -- a lot
of late nights sweating over a balance sheet, trying to meet a
payroll.
13
I saw that if people are allowed to keep more of what they
produce, they will produce more than they can use. The remainder
is called capital.
When capital is taxed lightly, it becomes abundant. When it
is taxed heavily, it becomes scarce -- available only to those at
the top, who need it least of all. That's not what I want.
If capital were more abundant, however, labor would become
more scarce. Wages would rise, unemployment lines would shrink.
That is what I want.
That's why I want enterprise zones in our inner cities and
rural areas. That's why I want to make the R & D tax credit
permanent. And that's why I want to cut the capital gains tax
and index it for inflation.
Those are the fundamentals. I also see three other ways to
sharpen the competitive edge of American business:
-- first, strengthening small business, by cutting taxes,
ensuring that credit is available, and by lifting the dead weight
of government regulation;
-- second, supporting civilian R&D, by bringing the
development, production and marketing of technology closer
to the consumer;
-- and third, reforming our costly legal system, which mires
even conscientious businesses and individuals in a swamp of
frivolous lawsuits. My product liability reform and Access to
Justice Act will drain the swamp.
14
Frankly, passage of these bills won't be easy. Trial
lawyers are a powerful vested interest -- well-represented in
Congress and high on the list of political contributors, as my
opponent well knows. But America will never lead the world in
the 21st Century until we learn to sue each other less and care
for each other more.
The most competitive companies in the coming decades will be
those that most involve their workers in the business at hand.
Working men and women will want to know that they can enjoy both
economic opportunity and security. That is the fourth component
of my agenda: Promoting Economic Security.
Again, common sense shows the way: True security will come
only by developing individual capability, not dependency. And
that independence, in turn, comes through the private sector, not
the government.
Government's role will be to ease the individual's
adjustment to a fast-changing marketplace.
This means, in practice, a wider and more flexible range of
job training and placement services -- for both the young and
old, the blue and white-collar worker, and particularly during
the present period, workers from our defense industries.
The pace of the new economy makes new job training
approaches necessary: most workers will have more than one
employer, often more than one career, over the course of their
working lives. This fact raises concerns as well about workers'
ability to preserve their pensions as they make those changes.
15
This summer I signed a law to increase pension portability, but
there is still much to do.
Economic security requires as well a major reform of our
health care system. The present system's uncontrollable costs
and inaccessible coverage is the cause of great unease, even
fear, throughout our economy.
My reforms, which I have outlined in detail elsewhere,
addresses the roots of these problems while preserving and
building on our system's strengths -- our state-of-the-art care,
openness to innovation, and diversity of consumer choice. Taken
together, my reforms would cut health care costs by $394 billion.
In health care, as in so many issues this year, we stand at
a crossroads. The path my opponents have chosen would place a
full 13 percent of our economy under the control of the federal
government -- meaning more bureaucracy, rationed care,
inefficient delivery of services, and, in the end, higher costs.
Let common sense be our guide: We must enhance competition
and market forces, not restrict them; we must preserve individual
choice, not hand decision-making over to centralized
bureaucracies; we must reduce the burden on employers and
employees, not bury them in a tide of new taxes and government
regulations.
Job training, retirement security, affordable health care:
When combined with a new system of education and entrepreneurial,
competitive business, we can offer genuine economic security to
our working men and women.
16
The programs I've outlined are based on the principles that
will empower all Americans to make their own choices and better
their lives. But I believe we need to do more for some of our
citizens who have been left behind. That is the sixth component
of my agenda: Leaving No One Behind.
The American Dream is nothing more or less than the belief
that all Americans can make a better life for their children.
The dream has made us the most dynamic society in the world; and
in the new century that dynamism will be essential to outpace the
economic competition. We can only turn it to our full advantage
if every American has a shot at making good on the dream.
I reject the shopworn logic that sees poverty as a simple
lack of income -- a kind of economic shortfall that can be
replaced with a government check. A conservative philosophy of
empowerment must have at its foundation the creation of
character, through the ownership of property and the dignity of
work. That means sweeping away the nightmare of crime from our
cities, building a core of property owners, creating business
incentives, and making individual discipline and self-reliance
the goal of all our programs. The human capital unleashed in
this way will do much to drive us forward into the 21st Century.
I call the final component of my Agenda -- "Rightsizing
Government. "
You'll recognize that I take the term from the business
world -- which has a lot to teach those of us in government. At
a time when companies across the country have been restructuring,
17
cutting fat, increasing efficiency -- all to prepare for the
economic competition of tomorrow -- the federal government faces
an obligation to do the same.
Today the federal government spends nearly twenty-four cents
of every dollar of the nation's income. That figure provides
vivid proof of what I have often said: Government is too big and
it spends too much.
A bloated federal government, serving itself seconds rather
than serving the people first, will weigh us down in the economic
race of a new era.
The Agenda I publish today contains specific proposals to
cut the fat: caps on the growth in mandatory spending and a
freeze on domestic spending; a balanced budget amendment and a
line-item veto; and a new mechanism -- a check-off box on tax
returns -- to give taxpayers the power to cut the deficit
themselves.
The size and structure of government are relics of a
different age -- artifacts more suited to the dilemmas of fifty
years ago than the problems of today. An American renewal will
require a streamlined government -- consolidating agencies,
tightening budgets, and cutting the salaries of highly paid
federal employees.
Unlike my opponent, I do not believe the American people are
undertaxed. Quite the opposite: I am committed to cutting taxes
across the board. Let me offer an illustration of what we could
do: If Congress had acted on the $130 billion in specific
18
spending cuts I have already proposed, we could cut income tax
rates by one percent across the board; reduce the small business
tax rate from 15 percent to 10 percent, and reduce the tax on
capital gains.
That is the direction I propose we go: to tax less and spend
less; and to redirect our current spending to serve the interests
of all Americans.
I honestly believe that this is the way -- the only way --
to control the size of the federal government. The facts are
painful but plain: For Congressmen, spending is power. And they
will exercise that power until they have spent every last dime
they can squeeze from the working men and women of America. It's
as simple as this: Raising taxes won't cut the deficit.
Here, then, is my Agenda for American Renewal. It comes at
a time unique in our history, a turning point, a moment when one
era is passing away and another is being born.
I intend to fight for this Agenda, to fight as hard as I can
to get as much as I can, and then I'm going to come back for
more. If Congress balks, I'll move forward anyway -- just as I
have done with education and welfare reform. I'll work with the
governors, with state and local governments, with the private
sector -- with anyone who shares the urge to renew our country.
With the close of the Cold War we can target peace,
prosperity and promise at home. The American people want that.
The American people deserve it.
19
At the same time, Americans recognize that the great events
of recent years have shaken the world. If we are to succeed, as
a nation and a people, if we are to hold true to all that has
made America the last, best hope of man on earth, then our
renewal at home must enable us to make the 21st Century yet
another American Century.
My Agenda draws together our people and our government to
meet this challenge. We will create a $10 trillion economy. We
will renew America. We will win the peace.
I want America to seize this moment. I want to stimulate
entrepreneurial capitalism, not punish it; I want to empower
people to make their own choices, not yoke them to new
bureaucracies. I want a government that spends less and taxes
less. And I will fight without hesitation for a free flow of
trade and capital and ideas around the world -- because Americans
compete, never retreat.
I know times have been difficult for many Americans. The
world we knew as children -- no matter your age -- will never be
the same. America will change -- that is our destiny; how it
will change will soon be decided.
I ask, when you step into that voting booth, to please
consider carefully whose agenda for change best fits America's
principles, our national experience, and our hopes for lasting
peace and prosperity.
XXX
THE WHITE HOUSE
Office of the Press Secretary
(Detroit, Michigan)
For Immediate Release
September 10, 2669
REMARKS BY THE PRESIDENT
TO THE DETROIT ECONOMIC CLUB
Cobo Hall
Detroit, Michigan
1:00 P.M. EDT
THE PRESIDENT: Thank you all very, very much. Good
morning to everyone. And, Governor Engler, I'm proud to be with you,
sir, and thank you for that kind introduction. Greetings to Chick
Fisher, your Chairman, and Jerry Warren, both of whom have been most
hospitable to me. I've been here several times before this most
distinguished American forum and I'm delighted to be back.
This morning I am here for a very serious speech,
serious business. And I'm releasing today an agenda for the American
renewal. And I've come here today to introduce it to you and to the
nation.
MY agenda diagnoses the economic problems our nation
faces, lays out the principles that should guide us in the years
ahead, and explains the integrated approach that I am pursuing to
meet the challenge.
Over the past weeks I have been discussing certain
elements of my economic agenda, and in the weeks ahead I will be
expanding on those and other ideas. The document that I'm releasing
today shows how the pieces all fit together.
But let's begin this morning by stepping back, taking
stock of where we are as a great nation in the broader sweep of
history.
The American people have just completed the greatest
mission in the lifetime of our country -- the triumph of democratic
capitalism over imperial communism.
Today, this year, for the first time since December of
1941, the United states is not engaged in a war, hot or cold.
Throughout history, at the close of prolonged and costly wars,
victors have confronted the problem of securing a new basis for peace
and prosperity. The American people recognize that we stand at such
a watershed.
We sense the epic changes at work in the world and in
the economy, the uneasiness that stirs the democracies who served as
our partners in the long struggle.
We feel the uneasiness in our own homes, our own
communities; and we see the difficulties of our neighbors and friends
who have felt change most directly.
And we know that while we face an era of great
opportunity, we face great risks as well -- if we fail to make the
right choices, if we fail to engage this new world wisely.
But America has always possessed unique powers, and
foremost among them is the power of regeneration -- to transform
MORE
uncertainty into opportunity. Only in America do we have the people,
the talents, the principles and ideals to fully embrace the world
that opens before us.
For America to be safe and strong, we must meet the
defining challenge of the 1990s: to win the economic
competition -- to win the peace. We must be a military superpower,
an economic superpower, and an export superpower.
My agenda for renewal asks that we look forward -- to
open new markets, prepare our people to work, strengthen our
families, save and invest so that we can win. Our renewal depends on
economic growth -- but growth not for the few at the expense of the
many, not for the present at the expense of the future.
In our country we've always prized an entrepreneurial
capitalism that grows from the bottom up, not the top down; a
prosperity that begins on Main street and extends to Wall Street --
not the other way around.
That's the lesson I learned as a young man, packed up a
Studebaker and moved to Texas after another war, at the start of
another era. I saw jobs, prosperity -- an entire future -- built
with the hands of ordinary men and women with extraordinary dreams.
our nation has never been seduced by the mirage that my
opponent offers -- of a government that accumulates capital by taxing
it and borrowing it from the people -- and then redistributing it
according to some industrial policy. We know that the clumsy hand of
government is no match for the uplifting hand of the marketplace.
My international economic and trade strategy will
guarantee our position as an export superpower, extending our global
economic reach in tandem with our security presence -- to stretch
beyond our borders so that we can create more jobs within our
borders.
At the same time, we need to foster at home the
capabilities that will keep us in the lead: radical changes in our
education system to prepare our children for a constantly changing
workplace; incentives for the entrepreneurs and new technologies to
sharpen our competitive edge; job training, health care reform, to
promote the economic security of our working men and women; and new
approaches for reaching out to those who have been left behind,
since in the century ahead we will need the talent and the energy of
every single American.
And finally, because our greatest strengths flow not
from government but from the personal initiative of free men and
women, my agenda aims to check the growth of government, and, in some
important ways, to reverse it. Together, the components of this new
agenda should renew America according to her most cherished
principles.
And this renewed America will be empowered toward a
grand goal: to nearly double the size of our economy, to $10
trillion, by the early years of the next century.
To place this agenda in a larger context, let me turn
briefly to five profound changes now at work in our economy. when
Americans gather around the kitchen table at night and talk about how
they'll meet a mortgage, or pay the doctor's bill, they're feeling
these changes in their daily lives. And before the changes have run
their course, they will have forever altered the way Americans buy
and sell, work and create.
The first great change in our economy is ironically
caused by our very success in ending the Cold War. In the short
run, deductions in defense spending have meant painful lay-offs in
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many industries, and we are taking steps to ease this transition.
But in the medium and long run, deductions in defense spending will
free up priceless skills and technologies for peacetime growth.
second, most of our industries are transforming
themselves from old-style hierarchies into flatter organizations,
with fewer layers between customer and executive. The new
organizations emphasize a skill-based workforce, "lean production,"
and shorter production cycles. From castings to computers, this is a
revolution as dramatic as the one made earlier this century, when
Henry Ford led the country from craft-based production to mass
manufacturing.
While these changes are essential to maintaining our
competitive edge, they've come with a cost; everyone in this room
knows that -- lay-offs, cutbacks among both white- and blue-collar
workers. These hard-working people need reassurance -- not only
about their economic security, but about preserving the sense of
self-worth that only work can provide. The third change: While the
1980s brought us the greatest peacetime expansion in our history, the
boom also led too many of us to take on too much debt.
we have been paying that down, that debt -- and lower interest rates
have helped us do it. The process is largely over, but consumers and
companies remain cautious.
The fourth change involves our financial system. We
entered the '80s with a 50-year-old banking system, designed for the
days when tellers wore green eye-shades, not for an era when billions
-- billions of investment dollars can cross borders at the speed of
light.
In the late '70s, record interest rates and inflation
rates rocked this anachronistic system. The less efficient
institutions could not survive, obligating the federal government to
protect the savings of millions of Americans.
Now, this process of paying debt down is nearing its
end. Our financial system will become more flexible and efficient.
But for now, lenders are cautious and, despite low interest rates,
small business still can find it hard to get the credit.
But the most far-reaching of these five changes is the
emergence of a global economy. No nation is an island today. One
out of every six manufacturing jobs is directly tied to exports. The
crops sown from one out of every three acres of farmland are sold
abroad.
Consider some implications of the global economy: when
growth slows abroad, as it has recently, our own growth slows as
well. And America will only grow in the next century if we can
compete globally -- in every part of the world. so we must seize
every opportunity to open new markets, particularly those with the
greatest potential for expansion.
Now, in drafting an agenda for America's future, we had
to assess our strengths as well as our weaknesses. Conveniently, the
other side has discovered many weaknesses and very few strengths.
And, of course, they might find temporary political gain in
portraying an America as past her prime, over the hill. But they
have no more right to argue, for partisan purposes, that our economy
is weaker than it is, than I have to understate our problems.
Our strengths are real. NOW, here are some facts. The
Misery Index -- the sum of inflation and unemployment -- is 10.8
percent, down from 19.6 Percent in 1980. Inflation stands at about
three percent. Interest rates are at a 20-year low.
The purchasing power of Americans gives us the highest standard of
living in the world. We enjoy the highest home ownership rate of all
major industrialized countries. And we send 68 percent of our
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children on to higher education -- more than any other country -- and
well above Germany's 32 percent and Japan's 30 percent. And with 5
percent of the world's population, we produce 25 percent of the
world's total output -- and 37 percent of its high-tech products.
Now, I don't mean to suggest that all is well -- that we
don't need to lead and manage the changes that are transforming our
economy. But you can't chart the stars if you think the sky is
falling down. Over the past 12 years we have almost doubled the size
of our economy. It's as if we'd created two extra economies the size
of Germany's from scratch.
And how will we meet our goals? Before you hear the
specifics of this agenda, let me tell you a little bit about what I
believe -- because change, if it is to be a force for good, must be
guided by principles. And the principles that must guide change are
the principles that never change.
I believe we are a nation of special individuals, not
special interests. Individuals draw their enduring strength from
their families, from their neighbors and communities, not from the
government. So I believe we must never ask government to do what
families and neighbors and individuals can better do for
themselves -- and for one another.
I believe -- because I've seen it -- economic growth
comes from the small businesswoman who takes a risk on a new product,
from the computer hacker working in a garage, in a cluttered way;
from the merit scholar in South L.A., South Central L.A. with a
future as big as his dreams.
And I believe government owes it to them, and to you, to
keep tax rates low and make them even lower; to keep money sound; to
limit government spending and regulations; and to open the way for
greater competition, and freer trade.
But I do not believe, as some might, that government's
obligation ends there. As a conservative I believe that government
can help people -- offer them hope and opportunity -- by giving them
the means and the confidence to make the decisions that matter in
life.
My background has also prepared me for the task of
bringing our foreign policies and our domestic policies together; to
turn our strength as a world power to our advantage as an economic
power; to match the security we feel militarily with the economic
security that we must build at home. From now on, if America is to
lead the world, we need a leader who knows the territory.
MY agenda for American renewal calls for action on six
interconnected fronts. There's no single cause of our present
situation. There can be no single cure. The whole of our agenda
will be -- must be -- greater than the sum of its parts.
First, challenging the world. During the Cold War, we
built a global security structure with military alliances across the
Atlantic and the Pacific. And in the same way, the post-Cold War era
requires a strategic economic and trade policy -- global in scope,
and built on our foundation as an economic and export superpower.
We are uniquely positioned to achieve this goal. As the
largest fully integrated market in the world, we wield leverage with
other countries that want access to our market. As both a Pacific
and a European power, we are tied to the largest and most rapidly
growing economies across both oceans. And as the strongest nation in
our hemisphere, we are looked to for leadership by free economies
emerging from Chile all the way up to Mexico.
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The same holds true for the newly born economies of
Eastern Europe and the former Soviet Union, where our values, our
products, even our language, carry a unique appeal. In MOSCOW today,
the lines at McDonald's are longer than the lines at Lenin's Tomb.
The key to America's growth, expansion, and innovation
has always been our openness to trade, investment, ideas, and people.
AS this openness is at last being reciprocated around the world, we
find ourselves again at a special advantage.
The next steps in my strategic trade policy are to
secure congressional approval of the North American Free Trade
Agreement and to complete the global trade negotiations, the GATT
round, creating high-wage American jobs and expanding the pool of
customers hungry for the fruits of American labor.
Let me emphasize: these agreements are steps, not ends
in themselves. And 50 I want to announce today that it is my goal to
develop a strategic network of free trade agreements -- with Latin
America; with Poland, Hungary and Czechoslovakia; and with countries
across the Pacific. And then, as these external barriers fall, I
believe we can help reduce internal barriers to competition as
well -- in North America, Western Europe, Japan, and elsewhere.
Greater competition will encourage entrepreneurial capitalism at the
expense of government power and entrenched interests, spurring
unprecedented economic growth.
Traveling around the country I've seen it happen already
-- particularly in some small businesses, as they strengthen
themselves for international competition. A couple of weeks ago, in
St. Louis, I visited Public Safety Equipment -- they're a company --
they make the light-bars that you've seen on police cars. The
president of Public Safety told me that a few years ago, they
recognized they could no longer just sell their products in 50
states, leave it at that. And so they took on the world. And now 35
percent of what they make is sold in 48 countries, creating good jobs
right here in the United States of America.
Public Safety, and the hundreds of thousands of
companies like it, offer a glimpse into the future I see for all
American business. But a business is only as efficient. as resilient
as innovative, as the people who keep its books and build its
products and devise its strategy. Materials, machines, methods --
they'll come and go, but the American worker will remain the key to
our economic security.
That brings me, then, to the second part of our agenda:
preparing our children.
The workplace of the 21st century will be constantly
changing. I've heard that from many businesspeople sitting right
here at the tables in this hall. We must prepare the American people
for a lifetime of learning, to keep a step ahead of that process of
change. Now, developed nations need developing minds. The burden
will fall on our educational system. As in the past, education
should be the ladder that children can climb to better themselves.
our current school system is not up to the task.
Designed for the 19th century, it will collapse under the weight of
the 21st. And our educational establishment is caught in the same
time warp, where standing still means falling behind.
Money alone is not the answer -- the United states
already spends more per pupil than any other country but Switzerland.
The answer is a radical overhaul of the system itself. If we want to
change our country, we've got to change our schools.
The catalyst for change -- the one reform that drives
all others -- is school choice, giving children scholarships so that
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all parents have the freedom to choose which schools will best serve
their children. Competition is the principle that must underlie
education reform, to break the establishment's monopoly on the
system. And competition will not work unless parents are allowed to
choose their children's schools -- whether it's the public school
across town or the parochial school across the street. (Applause.)
Consider just one statistic: in Chicago, 46 percent of
public school teachers send their children to private schools.
Clearly they know something about monopoly education that my opponent
doesn't. Our different approaches to education reform reveal the
grand canyon that divides me and my opponent. You see the same
contrast in child care, or health care, and a host of other issues.
My opponent prefers uniformity to variety and choice, relying on
these government bureaucracies to offer "one-size-fits-all service."
I don't want to pull everyone down to make everyone equal. I want to
give everyone the tools to climb as high as they can dream.
Even as we fix our schools, the question remains: Will
there be good jobs for the kids? And that's the third part of my
agenda: sharpening businesses' competitive edge. I learned my
economics the way most of you did -- a lot of late nights sweating
over a balance sheet, or P & L statement, trying to meet a payroll.
And I saw that if people are allowed to keep more of what they
produce, they will produce more. It's common sense.
When capital is taxed lightly, there's more of it. And
when it is taxed heavily, it becomes scarce -- available only to
those who are already wealthy, who need it least of all. That's not
the kind of economy that I want.
And if capital were more abundant, labor would be more
in demand, wages would rise, unemployment lines would shrink. That
is the kind of economy that I want. And that's why I want enterprise
zones in our inner cities and in our rural areas. That's why I want
to make this research and development, this R & D tax credit
permanent. And that's why I want to cut the capital gains tax and
index it for inflation. (Applause.)
Those are the fundamentals. I also see three other ways
to sharpen the competitive edge of American business:
-- first, strengthening small business, by cutting
taxes, making sure that credit is available, and by
lifting the deadweight of government regulation;
-- second, supporting civilian R & D, by bringing the
development, production and marketing of technology
closer to the consumer;
--- and third, reforming our legal system. Every year
American business and consumers spend up to $200 billion just in
direct costs to lawyers -- far more than our competitors in Japan and
Europe. And my product liability reform and access to justice act
will restore rationality to the system and stop undermining the
American worker. (Applause.)
This is a fact: We w1ll never lead the world in the
21st century until we learn to sue each other less and care for each
other more. (Applause.)
The fourth part of my agenda: promoting economic
security -- for working men and women.
Again, common sense shows the way: true security will
come only by developing individual capability, not dependency. And
that independence, in turn, comes through the private sector, not the
government.
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Government's role will be to ease individuals'
adjustment to a fast-changing marketplace. The average worker today
will change jobs, it's estimated, 10 times over the course of his or
her working life.
so we need a wider and more flexible range of job
training and placement services -- for both the young and old, the
blue and white-collar worker, and now especially for our workers from
the defense industries.
Pensions must be portable -- and health care must be
affordable. Our health care system today, I think everyone here
would agree. provides the best care, but at an unacceptable price.
More than thirty million Americans have no health insurance. Health
care costs are the fastest-rising part of our budget for government,
businesses, and yes, families.
My reforms get to the base of these problems while
preserving and building on our system's strengths -- our state-of-
the-art care, openness to innovation, and consumer choice. Taken
together, my reforms cut health care costs by $394 billion over five
years.
My opponent's plan could eventually place a full 13
percent of our economy under the control of the federal
government -- meaning more bureaucracy, rationed care, inefficient
service and, in the end, higher costs.
We must enhance competition and market forces, not
restrict them; we must preserve individual choice, not hand decision-
making over to centralized bureaucracies; we must reduce the burden
on employers and employees, not bury them in a tide of new taxes and
government regulations. (Applause.)
The programs I've outlined and that are detailed in this
agenda are based on the principles that will empower all Americans to
make their own choices and better their lives. But I believe we need
to do more for some of our citizens who have been left behind. And
that is the fifth component of this agenda: leaving no one behind.
The American Dream is nothing more than the belief that
all Americans can make a better life for their children. The dream
has made us the most dynamic society in the world; it's yet another
strength we can draw upon for the challenge ahead. And so we must
give every American a shot at making good on the dream.
And I reject the shopworn logic that sees poverty as a
simple lack of income -- a kind of economic shortfall that can be
replaced with a government check. A conservative philosophy of
empowerment must have at its foundation the creation of character,
through the ownership of property, through the dignity of work. That
means sweeping away the nightmare of crime from our cities, building
a core of property owners, creating business incentives, and making
individual discipline and self-reliance the goal of all of our
programs
I call the final component of my agenda -- "rightsizing
government."
You'll recognize that I take the term from the business
world -- which has a lot to teach those of us in government. At a.
time when companies across the country have been restructuring,
increasing efficiency -- all to prepare for the economic competition
of tomorrow -- the federal government faces an obligation to do the
same. (Applause.)
Today the federal government spends nearly twenty-four
cents of every dollar -- twenty-four cents of every dollar of the
nation's income. And that's the fact: government is too big and
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spends too much. The size and structure of government are relics of
a different age -- artifacts more suited to the dilemmas of 50 years
ago than the problems of today. Every institution in our society has
learned that by pushing power down through organizations, by using
technology to speed the flow of information, you don't just save
money, you improve productivity. It's time for the government to do
the same.
I will streamline government -- consolidating agencies,
tightening budgets, and cutting the salaries of highly paid federal
employees. And I'll start by cutting the White House budget 33
percent if the Congress cuts its own budget by the same amount.
(Applause.) You might say: Why the linkage? well, with fewer
congressional staff badgering us for endless reports and endless
visits to Capitol Hill, I know we can cut costs by that amount.
(Applause.) And I'll cut the salaries of all federal employees
earning more than $75, by 5 percent. Taxpayers have tightened
their belts. The better-paid federal workers should do the same.
The agenda I publish today contains specific proposals
to cut the fat: a cap on the growth in mandatory spending --
without touching social security -- and a freeze on domestic
spending; a balanced budget amendment, a line-item veto -- (applause)
-- and a new mechanism -- disciplinary mechanism -- a check-off box
on tax returns to give the taxpayer the power to cut the deficit. I
will fight to reduce spending and spur growth so we can get this
budget in balance.
And unlike my opponent, I do not believe the American
people are undertaxed. Quite the opposite: I am committed to cutting
taxes across the board. And let me offer an example -- this is just
an example -- as an illustration of what we could do: My cap on the
growth of mandatory spending allows for population growth and
inflation. It specifically exempts Social Security. But that cap
alone, with those caveats, would save about $300 billion over five
years. If we used just s130 billion in specific spending cuts that J.
have already proposed -- specific spending cuts of $130 billion that
I have already proposed -- we could cut income tax rates by one
percentage point across the board; reduce the small business tax rate
from 15 percent to 10 percent, and reduce the tax on capital gains.
That's the direction that I want to go: tax less, spend
less, cut the deficit, and redirect our current spending to serve the
interests of all Americans. I honestly believe that this is the way
-- the only way -- to control the size of the federal government.
The facts are painful, but plain: For congressmen, spending is
power. And they will exercise that power until they have spent every
last dime they can squeeze from the working men and women of America.
And it's as simple as this: raising taxes won't cut the deficit.
Here, then, is my agenda for American renewal. It comes
at a time unique in our history, a turning point, a moment when one
era is passing away and another is being born.
In the agenda published today, you'll find 13 proposals
that I intend to achieve in the first year of my second term. H
present them as a single program, a unified strategy to make. change
work for America.
over the last three years I've shown how America can
change the world; and we've made a respectable start managing the
change at home. Our primary task now is to target America.
I intend to fight for this agenda, to fight as hard as I
can. with a new Congress that can have as many as 150 new members, I
am optimistic. If congress balks, will move forward anyway -- just
as I have done with education, regulatory and welfare reform. I'll
work with our great governors, like John Engler, with the state and
local governments, with the private sector -- with anyone who shares
the urge to renew our country.
The American people know that the events of recent years
have shaken the world. with the close of the Cold War we can achieve
peace, prosperity and promise at home. The American people want
that. The American people deserve that.
And I want America to seize this moment. I want to
stimulate entrepreneurial capitalism, not punish it; I want to
empower people to make their own choices, not yoke them to new
bureaucracies. I want a government that spends less, regulates less,
and taxes less. And I will fight without hesitation for a free flow
of trade and capital and ideas around the world -- because Americans
never retreat -- we always compete. (Applause.)
My agenda draws together our people and our government
to meet this challenge. We will create a $10-trillion economy. And
we will renew America. And we will win the peace. (Applause.)
I know that times have been very, very difficult for
many Americans. The world that we knew as children -- no matter your
age -- will never be the same. America will change -- that's our
destiny; how it will change will soon be decided.
I ask, as you consider the choice that you face, to
consider carefully whose agenda for change best fits America's
principles, our national experience. and our hopes for lasting peace
and prosperity.
Thank you for your attention. And may God bless our
great country. Thank you. (Applause.)
END
1:40 P.M. EDT