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Agenda for American Renewal--Detroit Economic Club 9/10/92 [OA 7580] [2]
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26
22
7
7
9/7/92
EDITS
7pm
I. Introduction: The Challenge
Ameri ca stands at the edge of a century. Here is my bridge ins to the other shere.
This is my An Agenda for American Renewal. It diagnoses the
put
economic problems we face, sets ing forth the principles that should
our
already underway
guide our actions, and explains ing the integrated efforts I am
FOR
pursuing to meet the challenge.
Over past weeks I have been discussing some of the elements of my
economic agenda. In coming weeks I will be expanding on my
ideas. This document shows how the pieces fit together.
STEP
TO
It is important to begin by standing back for a moment, taking
'VE BEEN AND WHERE WE'RE GOING. WE BEGIN IN THE MIDDLE,
stock of where we are as a great nation in the broader sweep of
history. BETWEEN THE HEART BEATS OF HISTORY. IN ATTENDING TO THE MOMENT,
WE MUST NOT FORSAKE THE HOUR.
The American people have just completed the greatest mission of
all, the triumph of democratic capitalism over a frightening,
IMPERIALISTIC COMMUNISM
rapacious, totalitarian nuclear superpower. Mission
nice , cl
shortened
so you won't
accomplished.
stepm your
Throughout history, when long wars end, people have been
confronted with the problems of converting to peacetime and
establishing a new basis for securing peace and prosperity.
In wartime, the costs of government are always high. Domestic
IN TIMES OF CONFLICT
needs are not fully met. A good nation engaged in conflict tries
AND
to look after its poor, its sick, ^ its elderly, its less
ewould LIKE TO.
privileged members, but not as completely as it should.
Today, this year, for the first time since December 1941, the
United States is not engaged in a war, hot or cold. WE ARE A NATION AT A
PEACE.
BUT BEING AT PEACE WITH OTHERS + BEING AT PEACE 3 ITI+ OURSELVES
ARE DIFFERENT THINGS. THE ONE WE HAVE ACHIEVED. THE OTHER, WE CAN AND WILL
PROMISED LAND
The American people recognize this historical watershed. They
DEMAND THE LOWERTAXES , THE LESS GOVERNMENT THE FISCAL RESPONSI BILITY
want and deserve a peacetime system of taxation, a peacetime
OFA NATION AT PEACE.
freedom from unnecessary intrusion into our lives, a peacetime
commitment to sound money, a peacetime dedication to unfinished
work and unsolved problems close to home.
At the same time, Americans are aware of epic changes in the
world and the economy. They sense the disquiet in many of the
industrialized democracies that have been our partners in the
long struggle. Our own economy has been going through some
profound changes. And I know change can be difficult,
particularly for those who feel its effects more directly.
Americans sense we face an era of great opportunity, but that
CHOOSE WISELY
there are also great risks if we fail to make the right choices,
if we fail to engage wisely.)
WE MUST NOW
OUR
It is vital for our nation to demonstrate its unique ability to
OPPORTUNITY.
N AMERICA DO WE HAVE
transform anxiety into regeneration. Only the United States has
the people, the resources, the economic strength -- and
especially the principles and ideals -- to pick up the challenge.
- 2 -
For America to be safe and strong we must meet the defining
challenge of the '90s: to win the economic competition -- to win
the peace.
The United States must be an economic superpower, an export
superpower, and a military superpower.
My approach to this future is to look forward -- to open new
markets, prepare our people to compete, to restore our social
fabric -- to save and invest -- so we can win.
This future depends on economic growth, but not for the few at
the expense of the many, not for the present and the expense of
the future.
In this country, we have always preferred an entrepreneurial
capitalism that grows from the bottom up, not the top down, a
capitalism that begins on Main Street and extends to Wall Street,
not the other way around.
STRAIGHT
Nor have we been taken in by the view my opponent prefers, that
your YOUR GET "ME'S",
Government should accumulate capital -- by taxing it and
borrowing it from the people, and investing it according to some
industrial policy design.
My agenda is for an inclusive America, not an exclusive or
reclusive America. My international economic and trade strategy
?
will promote free trade arrangements east and west, north and
south, to strengthen our global economic reach and complement our
worldwide security presence. At the same time, we need to foster
Developed demand
the capabilities at home that will keep us in the lead. A To help
developing
minds
OUR
prepare all American children for a constantly changing
workplace, I want to make radical changes in our education
system. Each child should graduate with skills, self-discipline,
and a strong SELF sense of self worth. I will sharpen the competitive
edge of our businesses through encouraging entrepreneurial
capitalism and small business, deploying advances in R&D & AND
technology, and reforming our legal system so it no longer puts
us at a global disadvantage. My agenda promotes economic
security for working men and women through job training that will
WITH
ease adjustments and provide people' new capabilities for work in
the face of competition and change. And I will enable families
to concentrate on building for the future by giving them the
means to protect themselves against today's cost of health care
and by making it easier to build retirement security. I want our
efforts to reach out to all our citizens, leaving no one behind,
because we will need the work, aspiration, and energy of each and
every American. Finally, since our competitive strength and
entrepreneurial spirit must flow from the private sector, I will
streamline government to meet changing needs. It should not
siphon off more resources than is absolutely necessary.
Taken together, in mutual support of one another, the components
of this agenda should empower America to seek a grand goal: to
4
double the size of our economy to $10 trillion, in no more than
years.
Think of what we could do with another $5 trillion in annual
Do you
income. With an economy that size, we could provide the
really
resources, private and public, to satisfy our most ambitious
need
this
social and financial requirements. We could simultaneously renew
graph?
How about
America and pay down our national debt.
letting
that mevious
statement ust So stand now let and me resonate. turn to how we can meet the challenge and reach our
goal.
II. The Context: Five Changes Underway in the Economy
The U.S. economy has been working its way through
five profound changes they establish the context for my
agenda.
The first great change in our economy is ironically
due to our very success in ending the Cold War. Since
our superpower rival of the last half century has
DROPPED OUT OF THERACE
disappeared, we are now able to do something we have all
hoped for since the close of World War II -- lighten the
load. In the short run, this adjustment has meant
cutbacks and lay-offs in many industries that have
MUST
depended on defense spending. We need to take steps to
ease this transition. But in the medium and long run,
-5-
6
reductions in defense spending will free up many new
resources for our people and economy.
TIME you OPEN THE BUSINESS PAGES
Sometimes
Second, it seems that almost every day you can find a
you're tabbing
story about a major U.S. corporation that is
graphs,
sometimes
restructuring itself. Our industries are in the process
your just
separating
of transforming themselves from the old-style
them with
hierarchical organizations to so-called "flattened"
double space.
structures. pyramids This new industrial organization emphasizes
Weed to
be consistent
a skills-based workplace, "lean production," and short
product cycles rather than mass production® In effect,
we are integrating R&D, manufacturing, and marketing into
nevo herion
a seamless web of innovation. It is a change comparable
to the one we made when Henry Ford led the country from
craft-based production to mass manufacturing early in
this century.
We have to make these adaptations if America's industries
are to keep ahead of their international competitors.
Strong sales and productivity increases are the
prerequisites for creating more jobs, boosting wages, and
upgrading benefits. In fact, it is partly because of
these changes that American firms lead the world in
exports and that the increase in U.S. manufacturing
productivity during the '80s was our best performance
since World War II.
7
Nevertheless, these changes also have produced layoffs
and relocations among both blue and white collar workers.
Middle-aged breadwinners are wondering whether their
company will be the next to make announcements, and they
worry about their jobs, health care and pension rights.
Some are also deeply troubled by the prospect that after
sacrificing to send their kids to college -- often the
first generation to attend --[that some of these children
their diplomas aren't golden tickets to security. ?
Third, the 1980s wiped away the dismal economic
performance of the late '70s. We enjoyed the longest
peacetime expansion in U.S. history, lasting seven and
a half years. We created over 21 million jobs, more than
all the new jobs in the other major industrial countries
and the rest of Western Europe combined. Yet great booms
produce excesses, and this time too many companies, too
many financial institutions, too many governments, and
too many household took on too much debt. Herein America?
We have been paying down that debt over the last three
years -- and lower interest rates have helped us do it.
Millions of people have refinanced homes at lower rates,
reducing mortgage payments by as much as $1,200 to $1,500
a year. When companies restructured, they paid down
debt, strengthened balance sheets, and positioned
8
themselves to enjoy greater profits when stronger growth
resumes. This process will leave our economy leaner and
more powerful; indeed many firms already are. But while
that debt was being paid down, people bought fewer goods
and companies put less money into new investments and
jobs. The process is largely over, but it has left
consumers and companies a little cautious.
Fourth, we entered the '80s with a banking system
incongrum
designed 50 years earlier -- a relic woefully out of
place in an era when billions of dollars could be sent
around the world in a microsecond. The United States
entered the 1980s with some 14,000 commercial banks and
4,600 savings and loans. In comparison, Canada had
/ Germany had
, and Japan had
. The
vast majority of those small U.S. banks and S&Ls operated
in a heavily controlled environment where their costs of
funds were limited by ceilings on your passbook accounts.
Other regulations restricted competition by imposing
costs and inefficiencies on savers and borrowers.
In the late '70s, this out-of-date system was
buffeted by record interest and inflation rates; it was
challenged by competition from new financial services.
As in any other line of business, the less efficient
institutions could not survive. But because our banks
and S&Ls held insured deposit accounts for most
hardworking Americans, the streamlining process had to
9
be managed in a way that enabled the Government to
protect your savings. The Government picked up these
costs so your savings would be safe.
This process, too, is nearing its end. A strong
economy must have a good banking and financial system so
entrepreneurs can get capital, business and farms can get
loans, and families can buy homes and cars. We will have
a more competitive and efficient financial system that
will serve companies and families better. Over the next
few years, the Government will actually gain revenues
from the sales of billions of dollars of assets that it
acquired from banks and S&Ls as it protected savers. But
this process has left lenders cautious. Business
borrowing rates and mortgage rates are way down, but it's
still too hard for small businesses to gain access to
capital and credit. We are still taxing capital too
much.
The final economic change is perhaps the most
profound of all: No nation is an island today. We
are part of a global economy. To grow is to trade; to
expand is to compete. One manufacturing job out of every
six depends directly on our exports; so does one acre out
is sowed for sale abroad.
of every three planted by American farmers.
This international economic influence has three
implications.
bad connotations.
10
One, when growth slumps abroad, it drags our economy down
with it. Both Western Europe {especially Germany} and
Japan are going through major readjustment -- and that
has contributed to our sluggishness.
Two, it means that if America is going to be strong and
growing in the 21st Century, we must be ready, and able twilling
to compete around the globe. We need to encourage
entrepreneurial capitalism and investment at home, and
at the same time ensure that our labor force remains the
best in the world.
Three, we need to seize opportunities to develop new
markets, particularly in areas that have potential for
significant growth in the future. One of the other
benefits of the end of the Cold War is the extraordinary
potential to expand trade and sales to hundreds the captive of of
millions of potential customers who not long ago were our
enemies.
III. Start with Strengths
In developing an agenda for the future, we should
take a clear-eyed look at our strengths as well as
weaknesses. Not surprisingly, the other side has
11
conveniently skipped over our country's many strengths.
They have to justify their candidacia by making
Frankly, they want you to believe America is over the
hill and past its prime. But they have no more right to
convince you the economy is worse than investate it is for
political advantage than I have to sugarcoat the
problems. So we let me just note 10 key facts. (See
Appendix A for others.)
The Misery Index -- the sum of inflation and
unemployment -- is down to 10.8% today, from
19.6% in 1980.
Inflation has fallen to roughly 3%, the lowest
in a quarter of a century (except for 1986).
Interest rates are at a 20 year low. Mortgage
rates are now in the 8% range, half the rate
President Reagan encountered in his first year.
Thanks to these low rates, more people can
afford to own a home today than at any time
since 1973.
While unemployment is still far too high, the
share of the working age population with jobs
during my administration has averaged 62.2%,
the highest in U.S. history.
12
The United States has the highest home
ownership rate of all major industrialized
countries: More than 66% of U.S. households
own their own homes, as compared with 61% in
Japan and 39% in Germany.
The U.S. sends 60% of its children on to higher
education, second only to Canada, and well
above the 32% rate in Germany and 30% in Japan.
And 51% of these U.S. students are women, as
compared with 38% in Japan and 26% in Germany.
With exports of $622 billion, the U.S. is the
world's largest exporting nation. Exports
increased by 40% during my Administration.
We produce 25% of the world's total output with
5% of the world's population.
Manufacturing is now accounting for 22.6% of
U.S. GDP -- a higher percentage than a decade
ago.
13
The productivity of American workers is
approximately 26% above those in Germany and
30% above those in Japan.
I do not mean to suggest either that all is well or
that we do not need to lead and manage the changes taking
place in the world and at home more actively. We do.
BUT YOU CAN'T CHART THE STARS IF YOU THINK THE SKY is FALLING
Nevertheless, it is important to recognize honestly
WE MUST KNOW OUR STRENGTHS BEFORE WE BUILD ONTHEM.
what we have accomplished over the past 12 years, so we
can build on our strengths. During our long expansion,
we increased U.S. GDP by $1.1 trillion -- a figure
greater than the total size of the German economy. So
I know our goal of a $10 trillion economy is attainable.
We're also in a strong position internationally. But
we're going to need the national adaptability and
capability to keep leading our competitors. And we must
have the courage of our convictions to say "no" to the
wrong sort of changes for the future -- false promises
based on false premises -- changes we cannot afford at
this key moment in the world economic competition.
IV. Guiding Principles:
Before outlining the specifics of my agenda, I will
set out four guiding principles. An effective strategy
14
must be dynamic. As new problems or opportunities
present themselves, we will need to make adjustments.
Guiding principles will ensure we follow a consistent
path and help shape our policies into the future.
WE ARE A NATION OF SPECIAL
First, start with the basics: I believe America is
composed of individuals, not special interests.
Individuals gain primary strength, protection and
inspiration from their families and communities, not the
legal system or Government social services. People find
their friends and their enjoyment in voluntary
association with one another, not in some bureaucrat's
paint-by-numbers dream.
The individual, families, communities. That's where
we start.
Second, we have to keep to the fundamentals of sound
economic growth: lower tax rates, limits on Government
spending, greater competition, less economic regulation,
sound money, and more open trade that can free tremendous
private initiative and growth.
Experience has shown that these are the steps we
need to take to create jobs, raise wages, spur
entrepreneurs, expand capital and investment, and build
businesses.
Third, in the '90s Government can build on these
fundamentals by offering opportunity and hope for
15
individuals, families, and communities. There is a
conservative agenda for helping people, for responding
to their needs. And we've seen that these are approaches
that work.
We prefer a hand-up to a hand out. We want to
empower people to make their own choices, to break away
from dependency. We want to give individuals and
families economic security by giving them the capital,
the capabilities, and the confidence to decide for
themselves. We want everyone to have a stake in society,
to own property, so everyone will build something with
it for themselves and our country. Whereas my opponent's
approach may place a premium on redistribution and
"leveling," our programs will unleash initiative, reward
success, and encourage excellence. Our approach is to
give people the power to work, save, and be their best.
Finally, all our policies must be brought together
effectively if we are to prosper as a people and succeed
as a nation. America must have appropriate new
approaches for the changes at home -- just as we've
launched new policies to lead and manage change abroad.
We must concentrate RECOGNIZE on the interrelationship between
domestic and foreign policy and between economic and
security policy. At the same time we must execute our
agenda more effectively with a new Congress, state and
Stet
local governments, and the private sector Our aim must
16
be to press our policies together, as a package, to make
America secure and strong.
Therefore, my Agenda for American Renewal
MANDATES
necessitates action on six interconnected fronts.
Because we face complex problems, no one solution will
suffice. The whole of these elements will be a solution
greater than the sum of its parts:
A Strategic Global Economic and Trade Policy
Preparing our Children for the 21st Century
Economy
Sharpening Business' Competitive Edge:
Encouraging Entrepreneurial Capitalism
Economic Security for Working People
Leaving No One Behind: Economic Opportunity
for Every American
Keeping Government Slim
This is how America will create a $10 trillion economy.
17
V. A Strategic Global Economic and Trade Policy:
During the Cold War, we built a global security
structure to contain and counter the Soviet Union and
communist aggression. We forged military alliances
across the Atlantic and Pacific that underpinned that
structure. In the post-Cold War era, we need a strategic
global economic and trade policy that will ensure our
position as an economic and export superpower as well.
We are well positioned to achieve this goal. We
enjoy the largest fully integrated market in the world;
this gives us leverage with other countries that want
access to our markets. Once the Congress enacts NAFTA,
our position will be further strengthened. NAFTA will
open an important market, a Mexican economy whose growth
prospects will quickly transform its expanding industries
and consumers into excellent American customers. Equally
important, the integration of United States, Mexican, and
Canadian capabilities will improve our global
competitiveness by enabling American firms to purchase
inputs at lower costs. This will help U.S. firms to stay
in the forefront of high wage, high value added
production.
Our geopolitical position is also advantageous. The
United States is both a Pacific and a European power; our
18
political and security ties link us with the largest and
most rapidly growing economies across both oceans. Our
trans-Pacific trade already exceeds our Atlantic trade;
that's one reason why the United States helped launch an
organization for Asia-Pacific Economic Cooperation that
will further strengthen our economic ties with that
region. In addition, the countries in our own
hemisphere, from Central America to Chile, are looking
to strengthen their economic and trading ties with us as
they move away from autarkic economic policies and toward
free markets.
The spirit of freedom -- in Eastern Europe, the
former Soviet Union, and Latin America -- also offers us
a special opportunity. Free people and free markets
develop hand in hand. In these and other countries
around the globe, American values, American products, and
the English language hold special attraction. These
political and economic ties are complemented by the
appeal of American culture all around the world. This
is a new "soft power" we can employ. Today, our
entertainment industry is the United States' second
largest export business.
Finally, as the primary founder and the most
significant proponent of the GATT global trading system,
we continue to have special influence if we act in ways
that will truly open markets, including our own. The key
18
political and security ties link us with the largest and
most rapidly growing economies across both oceans. Our
trans-Pacific trade already exceeds our Atlantic trade;
WE
that's one reason why the United States helped launch an
organization for Asia-Pacific Economic Cooperation that
will further strengthen our economic ties with that
our OWN NEIGHBOES
region. In addition, the countries in our own
PANAMA
FERU WANT TO BUILD
hemisphere, from Central America to Chile, are looking
BRIDGES OF TRADE WITH US so THEY CAN EUILD 3 ETTER
to strengthen their economic and trading ties with us as
ECONOMIES FOR THEIR PEOPLE.
they move away from autarkic economic policies and toward
"THE BALL OF LIFERTY," THOMAS JEFFERSON ROLL ONCE AROUND WROTE THE GLOBE," "IS NOW IF SOWELL HECOULDONLY IN MOTION SEE WHAT THAT JUST ITWILL
free markets.
The spirit of freedom in Eastern Europe, the
ROLLED BACK
FREEDOM HAS ROLLED THROUGHT
INTO OUR
former Soviet Union, and Latin America -- also offers us
FRONT YARD.
THE BALL is NOW IN OUR COURT,
a special opportunity. Free people and free markets
develop hand in hand. In these and other countries
PEOPLE VALUE
PEOPLE WANT TO Buy WHAT
around the globe, American values, American products, and
WE HAVE TO SELL.
the English language hold special attraction. These
political and economic ties are complemented by the
appeal of American culture all around the world. This
is a new "soft power" we can employ. Today, our
entertainment industry is the United States' second
set
largest export business.
Finally, as the primary founder and the most
significant proponent of the GATT global trading system,
A STRONG HAND AS LONGAS WE USE IT TO
we continue to have special influence if we act in ways
that will truly open markets, including our own. The key
19
OUR
to America's growth, expansion, and innovation has always
been our openness to trade, investment, ideas, and
people.
Therefore, the next steps in my strategic trade
policy are to secure Congressional agreement to NAFTA and
to complete the global trade negotiations {the so called
Uruguay Round negotiations in GATT}. Our NAFTA agreement
OPEN DOORS
ES?
will be excellent for American business, workers, and
TOUGH
consumers. Nevertheless, I expect a difficult fight in
the Congress in early 1993 because of those special
interests who band together with a protectionist purpose.
The global trade negotiations, in turn, could be very
close to a breakthrough if the United States continues
to act as a strong world leader. There is a proposed
draft text that establishes the outlines of a significant
new GATT agreement. Once we assure cuts in the
subsidized agricultural trade along the lines of that
text -- to enable our farmers to secure their competitive
advantage -- I believe we will be able to complete the
Uruguay Round agreement.
An improved global trading system is, however, only
FOR
FREER TRADE
a base for further trade liberalization, stronger
FOR
ED
investment ties, and increasing global growth. We need
to start to develop a strategic network of free trade
agreements {FTAs} across the Atlantic and the Pacific and
in our own hemisphere. This network will stand in sharp
20
contrast to the illogic and backwardness of economic
OF ECONOMIC ISOLATION.
MUST HAVE GLOBAL REACH
blocs. If we are to be A true export superpower, we
cannot be tied down to one region. Instead, My intent
BALT TO CAST
is to use our attractive domestic market as the basis of OUR TRADE
LINES
a muscular free trade policy that will strengthen
OVERSEAS,
America' global economic reach and complement our
worldwide security presence.
By focusing on opening markets, I also believe we
can reduce structural barriers to competition in North
America, Western Europe, Japan, and elsewhere.
Competition will encourage entrepreneurial capitalism -
- at the expense of entrenched interests -- spurring even
greater global growth.
More specifically, I will need to secure from the
Congress additional trade negotiating authority within
WEB OF
the first half of 1993. To overcome the special
interests and the protectionists, I will need a mandate
TO CUT THE ROPES
from the American people^ If we are to be an export and
economic superpower, the President must take a strong
stand on the negotiation of trade and economic
READ
agreements. The Congress will presume vacillation as
weakness, and the national interest will lose out to the
logrolling tradeoffs of Congressional business as usual.
That's one very big issue at stake in this election.
WILL?
With new negotiating authority, I would pursue new
trading and economic opportunities in Latin America under
21
my Enterprise for the Americas Initiative, starting with
Chile. I would also like to work towards FTAs with
Poland, Hungary, and Czechoslovakia by the end of my
second term. And I would explore the possibility of a
connection between NAFTA and the ASEAN FTA, or AFTA. It
will not take long for other countries to begin to
express their interest in new trade and business ties
with us. For example, leaders in Australia and Korea
have already spoken of their interest in forging closer
SOME SEE NEW THREATS, OTHERSEEE OLD ENTIMIES.
economic ties.
SEE NEW NEW MARKETS, NEW DEPORT TUNITIES NEW JOES,
As we are developing this economic and trading
structure NETWORK for the 21st Century, I will vigorously
FIGHT MRE 70
safeguard and promote American trading interests. For
example, I am committed to a sizable Export Enhancement
Program {EEP} to ensure that our farmers can go head-
to-head with the European Community's subsidized
agricultural exports. We know from our experience with
military security that the key to economic security must
be based on "Peace Through Strength" -- noT
unilateral
nice
disarmament. That's why I recently announced the largest
quantity of wheat ever available under our EEP
program -- almost 30 million metric tons to 28 customers.
I will ensure that our ExIm Bank and the Overseas
Private Investment Corporation (OPIC), work with teams
of our ambassadors to develop trade and investment
AMERICAN
opportunities for U.S. firms. We've already begun this
22
and it'sworking.
with the six ASEAN countries. I will particularly stress
helping America's small business people to develop
-hese companies look small but they trade big. 1 know.
trading opportunities. If we are going to orient our 1 started
my own.
economy towards exports and international economic
competition, we can't just rely on our larger businesses.
I have visited small factories all across the United
States that first survived and then prospered by
TAKING ON
FOREIGN
orienting themselves toward the new international
economic competition. I know Americans can do it.
VI. Preparing Our Children for the 21st Century
GREATEST
LIE In IN THE FIELDS OF OUR IMAGINATIONS, IN THE METTLE OF OUR MWOS,
the 21st Century our primary national resource
will be our people. Materials, machines, and methods
will come and go, but the American worker will remain the
key to our economic security. Since the workplace of the
a constant evolution
21st Century will be constantly changing, we need to
prepare the American people to adapt to and lead the
process of change. Therefore, our kids must arrive at
school ready to grow, and they need schools where they
will learn how to keep learning all their lives.
Our New American Schools will help. prepare our
children to become the [useful citizens of tomorrow.
Equally important, we want to enhance children's sense
of self-worth, their confidence, their sense of
participation in a larger community and society. This
is an example of what I mean when I talk about a- THE
23
conservative philosophy of empowerment, helping people
to help themselves.
I want to do my best to help all children come into
the world as truly "created equal. That's why I am more
FUNDING
than doubling spending for a Healthy Start initiative
that targets communities with high infant mortality
rates. We are also increasing prenatal care, nutrition
services and substance abuse treatment for pregnant
FUCTLY CHILD MUST U.S. e DOCTOR EFFORE THEY ARE EARN. EVERY PARENT
women. / And I want everyone to get out the word that the
MUST SHARE THE GIFT OF HEALTH WITH THEIR CHILDREN.
behavior of parents is probably the most important
contribution to infant health.
We need to focus especially on the preschool years,
so that children coming to school are healthy and
curious. Funding for the Women, Infants 257.6% and Children
Nutrition Assistance program (WIC) has grown 365% between
1980 and 1992; my request for an additional $240 million
for 1993 brings the annual cost to $2.8 billion.
I have also increased funding for the Head Start
program by 127% -- for a total of $2.8 billion in 1993.
That includes an additional $600 million increase for
next year -- an unprecedented 27% annual jump -- so that
a year of Head Start will be available for every eligible
four-year old whose parents want to participate. (Under
my budget, almost 800,000 children will receive a year
of Head Start before entering elementary school.)
25
Switzerland. And funding for the Education Department
41
has increased % over my term.
The answer is a radical overhaul of our educational
system. If we want to change our country, we've got to
change our schools. That's what my Education 2000
program is all OUR KIDS about. CAN'T BEAT WORLI-CLASS COMPETITION IF THEY CANT MOLT
The first step is to establish world-class standards
FORGING
for our elementary and secondary schools. We are moving
ahead with the development of these standards in math,
science, English, history, geography, arts, and civics.
MUST HAVE
Second, we need voluntary national achievement tests
to measure the progress of our students. That way we can
compare the performance of different schools in helping
our children achieve the national standards.
Third, we need to give schools the flexibility to
become educational entrepreneurs -- to figure out the
best ways to motivate our children, use technology,
include parents, and involve new types of teachers. We
will create "Education Enterprise Zones." There is no
particular reason why schools have to end at 3 p.m. so
SIT IN FRONT OF THE
that students can watch TV for five hours a day. We need
to free school administrators and teachers from rules,
regulations, and reports that have become a poor
substitute for student achievement; we can do away with
red tape once we institute a new testing system that
26
evaluates schools on the basis of their performance, not
their bureaucracy.
Finally, we must give all parents the means
and freedom to choose which schools will serve their
children the best. This component is critical to the
success of the whole, integrated overhaul of our
educational system. Competition, the underlying
principle for this radical reform, will not work unless
we give consumers the ability to choose.
Wealthy families already have this choice for their
children. Many of the people that you saw at the
Democratic National Convention have this choice for their
children. Why shouldn't you have this choice for your
children?
Chicago's public school teachers -- 47% of
them -- send their kids to private schools. But my
or
opponent and his special interest supporters don't think
you should have the same choice unless you are privileged
enough to afford it.
One of the greatest educational innovations in this
country was the passage of the GI Bill after World War
II. No one told my generation that a vet couldn't go to
Notre Dame or Brigham Young or Baylor or Howard or
Yeshiva.
So I want a "GI Bill for Children" to help give
lower and middle income families the means to select any
27
CMORE pack , ne For HERE
school: public, private, or religious. I also want
scholarships available to be spent on after school,
Saturday and summer academic programs.
For those who argue that my approach will weaken the
public school system, I would remind them that the first
GI Bill was a tremendous boon for public universities.
or X listen X to Starr Parker, X a smáll business owner
X
X
actively X promoting choice in the Black community, who put
X
X
X
X
it this X way: "The rich have X choice now. When I was on
X
X
X
X
X
Y
X
NTimes
X
X
7/4/22
welfare, X there X was X no X way x I could put my child in a X good
school. X It's time X X we stop X condemning the poor to a
X
X
X
X
X
X
X
monopoly education system."
WHEN YOU TURN THE FIRST PAGE OF A VERY LOWG BOOK, YOU'RE
We ve already made significant progress in starting
ALREADY HALFWAY TO THE ENDIN 5.
this radical reform agenda. Some 44 states, and over
1700 communities, have already adopted my new national
education strategy -- America 2000. Indeed, this
progress offers a good example of my commitment to pursue
IS LATE with no HOMEWORK
my agenda whether or not Congress dawdles. I will work
with governors, state legislators, community officials,
and the private sector if Congress balks.
I hope the new Congress will not remain subservient
to the educational establishment and special interests
that want to resist this revolution. Because a new
system of education in this country is probably the most
28
important ingredient in making America the winning
economic and export superpower in the post-Cold War era.
This must not only be my agenda, but yours, too.
I will fight to give parents in America the right to
choose the school their children will attend, but you
AFTER YOU CHECK out or WORK CHECK INTO
need to help, too. When you return from work, turn off
YOUR CHILD'S HOMEWORK
the television, help your son or daughter with homework
JALK TD
if you ean, back up your child's teacher who's trying to
enforce discipline, join your local PTA. and support your
children's schools. My approach -- Education 2000 --
relies on parental, business, and community involvement
in creating new schools that break the mold.
PHILOSOPHERS OF ALL AGES FROM ARISTOTLE TO BARBARA BUSH -- HAVE PLACED
I put the family at the center of our society. I
GOVERNMENT MUST TRY TO HELP FAMILES -- NOT REPLACE
believe that parents are best able to make decisions
THEM. THAT WHEN IT COMES TO CHOICES FOR OUR CHILDREN, PARENTS REALITY
about their children, that federal policies should
DE KNOW BEST
support parents, that we should increase the range of
choices available to parents, and that government
assistance should be targeted to those families most in
need.
The other side may talk about similar problems, but
they are approaching them with a fundamentally different
ideology. You can see the contrast not only in
education, but in health care, or in the debate that took
place over my Child Care proposal, which we fought for
and managed to enact into law. The opposition prefers
uniformity to variety and choice. Because they place a
29
higher value on "leveling" society, they will tend to
rely on government bureaucracies to offer "standard
service." My approach to education, child care, health
care, and other topics is to rely on a diverse private
sector to supply the service and to empower families to
make their own choices. I don't want to pull everyone
down to make them equal. I want to give everyone the
CLIME AS HIGH AS THEY CAN DREAM.
tools to lift themselves as high as they can.
VII. Sharpening Businesses' Competitive Edge:
Encouraging Entrepreneurial Capitalism
Our ultimate success as an economic superpower is
dependent on encouraging the entrepreneurial spirit of
our private businesses. I call it entrepreneurial
capitalism, and I saw it work when I started a small
business in Texas. I also call it common sense.
You allow people to keep most of what they produce,
and they will produce more than they can use, the rest
being capital. You invite people to risk failure by
allowing them to keep the rewards of success, and they
will keep trying until they succeed.
When capital is taxed lightly, it becomes abundant.
When it is taxed heavily, as it is now, it becomes
30
scarce, available only to those at the top, who need it
JESSE JACKSON PUT IT THIS
least of all. That's not what I want. Without capital,
WAY: "SUBTRACT CAPITAL FROM CAPITALISM AND ALL THAT'S
as Jesse Jackson pointed out, capitalism is just an
LEFT is THE
ism' "" If capital were abundant, labor would become
scarcer. And the unemployment lines would shrink.
That's what I want.
So I want to cut the capital gains tax and index it
for inflation. I want to create enterprise zones in
inner city and rural areas. I want to make the R&D tax
credit permanent. I want to provide an additional first-
year depreciation allowance for purchases of property.
Those are fundamentals. In addition, there are
three other ways we need to sharpen the competitive edge
of American business:
strengthen small business;
support civilian R&D linked to a research
extension network; and
reform our costly legal system.
A. Strengthen Small Business
Small business is the backbone of a growing economy.
Small businesses employ more than half the American
workforce; they account for 39% of our GNP. Small
business creates two thirds of our new jobs.
31
I am seeking to aid small businesses by reducing
costly tax and regulatory burdens, increasing access to
credit, and removing barriers to competition.
I have taken steps designed specifically to ease the
tax burden on small businesses. For example, the IRS has
proposed regulations to allow small businesses to deposit
payroll taxes on a monthly basis. And it has released
a ruling allowing over 16 million sole proprietors to
deduct tax preparation fees as a business expense rather
than as a limited itemized deduction.
I want to build on these actions. For example, we
are working on a Single Wage Reporting System that would
permit businesses to report state and federal wage
information through a single entity, thereby
consolidating tax reporting requirements and reducing the
burden.
In coming weeks I will talk more about ways we can
encourage small businesspeople and the jobs they create.
On the regulatory front, I have extended for one
year the freeze on paperwork and unnecessary federal
regulation that I imposed last winter; the federal
regulatory weight hits small businesses particularly
hard. I have also instructed federal agencies to look
for ways to modify existing regulations that impose a
special economic burden on small business. For example,
to increase access to capital for small businesses, the
32
SEC has announced proposals to reduce and in some cases
eliminate the public disclosure requirement for small
companies issuing stock.
Since small businesses are particularly vulnerable
when credit is tight, we have to help them as our
financial system is restructuring. That's why we have
authorized over $6 billion in general business loan
guarantees through SBA in 1992 -- an increase of more
than 50% above 1991.
SBA's New England Lending and Recovery Project is
a pilot effort that extends credit to viable small firms
when access is limited because banks are having
difficulty. If it works well and is needed, I'll expand
the project to other regions. We also have worked with
bank regulators to base real estate values on income
earning potential rather than liquidation value. We have
taken steps to restructure the small business investment
program, the only venture capital program in the
government. And we are developing ways to offer special
financing to exporting entrepreneurs.
Through its procurement assistance program, SBA
helped small businesses secure federal contracts worth
over $35 billion in FY 90 -- almost 20% of all prime
contracts let during that year.
To ensure that small businesses can help their
communities overcome disasters, we will be providing
33
approximately $
million in low-interest loans to
small businesses in Florida, Louisiana, California, and
elsewhere.
Finally, we need to help small business by removing
burdens to competition. My health care reforms would
reduce costs for small businesses without costly
government mandates or higher taxes. Enactment of my
legislation to establish uniform federal law on product
liability would relieve a major competitive handicap that
00
is keeping new products from the market, boasting
insurance costs sky high, and killing jobs.
B. Support Civilian R&D
To be the world's economic leader tomorrow, we
clearly have to invest in R&D and new technologies today.
Given the pace of change, we have to both come up with
new inventions and organize ourselves to deploy new
technology without delay.
The changes in industrial organization that I
described earlier have three major implications for
technology development. First, the more rapid product
development cycle places a premium on bringing an idea
quickly from the lab to the marketplace. Second, we need
to put new technologies to work in all applications in
order to reap the full competitive and economic benefits
VCR
from our R&D. While Americans invented the FAX machine,
we did not benefit from its explosive popularity. Third,
34
we need to rely increasingly on flexible, agile
manufacturing, rather than old style mass production.
We should have the capability to make a variety of
products quickly and economically -- a process
characterized by short product cycles, but also high
quality output.
Taken together, these developments emphasize
decentralization -- an approach exactly opposite to my
opponent's "national industrial policies" led by
government bureaucrats. We need to get technology
development, production, and marketing closer to the
consumer, not further away. Moreover, my opponent's call
for a cut in support for university-based research will
hurt the development of cutting edge technology.
My agenda will increase funding for basic research
and complement that work with a focus on applied research
and development. Despite cuts by Congress, we have
26
managed to increase funding for basic research by 25
percent since 1989 -- to a record level. We are
supporting applied R&D through a series of new, high
pay-off investments in critical technologies:
a High Performance Computing and Communications
ENABLE
initiative that will assist the development of
a thousand-fold increase in computing
13
[TABLE 6-10; PART BIDGE
[TABLE
35
capability and a one hundred-fold increase in
communications speed by 1996
an initiative to improve the manufacturing and
performance of materials -- improvements that
will enable advances in a wide range of other
technologies.
an expanded program in biotechnology research
with applications in health, agriculture, and
environmental protection.
the establishment of the U.S. Advanced Battery
consortium, a jointly-funded four-year effort
to develop an advanced battery for an
emissions-free electric car.
a significant increase in our aeronautics
research budget, underscoring the importance
we place on the U.S. aeronautics industry in
an increasingly competitive global market
place.
SEVEN
the establishment of five regional
manufacturing technology centers for the
distribution of modern manufacturing
36
tools, such as computer-aided design,
numerically controlled machines, and robotics.
These efforts to develop and apply new technologies
need to be complemented by the identification and removal
of barriers to the private sector's ability to bring new
products and services to the market. That's why my
regulatory reform efforts -- including a process that
subjects regulations to a competitiveness analysis while
still protecting health and safety and a proposal to
sunset regulations -- are critical to supporting our
enhanced technology development.
Just take one example: my opponent has proposed a
major new federal government investment in the field of
national telecommunications networks at the exact time
that the private sector is seeking to develop such a
network on its own, but has been stopped from doing so
by federal regulations. (Get the facts.)
C. Reform Our Legal System
Our competitive edge will be dulled if businesses
are continually handicapped by a legal system that serves
lawyers but frightens people. Therefore, another
component of my agenda is a reform of the American civil
justice system.
America has experienced a civil litigation
explosion. Over the past 30 years, federal lawsuits have
37
tripled. Instead of being fast, fair, and affordable,
our civil justice system is slow, expensive, and putting
us at a global disadvantage.
Long delays in dispute resolution waste valuable
judicial resources, force early settlement by those who
cannot afford to wait, discourage those who have
meritorious suits, and encourage frivolous suits by those
who hope to leverage unjust settlements. High punitive
damage awards are passed on to consumers through higher
prices, job cuts, higher insurance, and fewer new
products.
According to a soon-to-be released study by the
National Association of Manufacturers, Americans spend
UP UPTO $200 billion a year just on direct costs to lawyers.
That does not even count lawyers on payrolls or the money
spent on court settlements.
Our legal system is killing our international
competitiveness. Other nations do not face high domestic
litigation costs. Foreign companies only need 2-5% of
the product liability insurance our firms must carry
because we do not have uniform state standards for
product liability and punitive damages.
The litigation explosion affects everyone. High
liability costs have closed playgrounds and pools,
forcing kids on the street with nothing to do. Companies
are afraid to offer products that are available in Europe
VOLVO
38
yes
-- like a carseat for children built right in the car or
a medical treatment for AIDS -- because they fear the
liability.
John
newn
My product liability reform legislation takes the
trial lawyers head on. I want to stop wide variation
among states' product liability rules; stop important
products from being kept off the market; stop excessive
litigation costs with more money going to lawyers than
to injured consumers; cut excessive insurance rates; and
end excessive consumer costs.
My "Access to Justice Act of 1992" is intended to
restore fairness and efficiency to the nation's civil
justice system through: alternatives to federal civil
trials such as alternative dispute resolution; incentives
for pre-litigation settlement, including precomplaint
notification; and a "loser pays" rule requiring the loser
to pay the winner's legal fees in suits involving federal
diversity jurisdiction.
We also need to continue our work with the states
to encourage fundamental change at the state and local
level.
Lawyers, especially trial lawyers, are a powerful
vested interest in our society. They are well
represented in Congress and high on the lists of
political contributors. My opponent knows them very
well. But this is a problem too important to leave to
39
the lawyers and their friends in high places. We must
sue each other less and care for each other more.
VIII. Economic Security for Working People
The American business of the 21st Century will
need workers who will bring them to life and keep them
ahead of our competition. To be able to contribute and
concentrate, working men and women will want to know
that they can enjoy economic opportunity and security
We can only achieve true security by developing
people's capability, not dependency. And we can best
supply security through the private sector, not
government bureaucracies.
It will be government's role to expedite workers'
adjustments in a fast-changing marketplace, provide
people the means to work and take care of their
families, and arm people to face the future by
empowering them to make their own choices. In
particular, we can enable families to focus on building
a future by alleviating their fears about one of the
single biggest costs and problems that can knock them
back: health care. And we can help foster retirement
security through encouraging portable pension savings.
40
A. Job Training
Given the rapidity of change in the international
and domestic marketplace, we have to prepare people for
the prospect of changing jobs and learning new skills
many times throughout the course of a productive life.
Therefore, we need a range of job training and
placement services -- for young people, factory
workers, white collar employees, and particularly
during this period, defense industry workers.
That's why one important portion of my
recently-announced workforce adjustment initiative is
designed to shift the government away from the old
narrowly defined, expensive, and less effective trade
adjustment assistance that paid people off without
giving them real help to get back the work.
Work means more than income to Americans. It is
also fundamental to people's self-esteem, their self-
confidence. These are attitudes, values, that I want
to encourage. I want all Americans to be builders --
for their families, their communities, their country.
To encourage the work ethic, we need to make every
effort to match people with the jobs created by our
entrepreneurial capitalism.
The three key features of my job training proposal
are: (1) universal coverage, so all dislocated workers
will have access to basic transition assistance and
41
training support; (2) skill grant vouchers of up to
$3000 to help meet the costs of adding new skills and
training; and (3) a tripling of the resources currently
devoted to training and worker adjustment, an
allocation of $10 billion over five years.
This proposal builds on my January plan to
streamline the federal job training system through
"one-stop shopping" in every community. Experience has
demonstrated that the most effective training and
placement services are those closely developed with
local employers through private industry councils.
That way the training is designed to develop skills
that employers know they will need.
My expanded job training efforts will also be
specially designed to help those who may need to change
jobs or careers as a result of NAFTA or other trade
agreements and the downsizing of our defense-related
industries. But we will ensure that we offer training
and placement to all workers: those who have lost their
jobs, have been notified that their jobs are being
terminated, or have been employed in industries
experiencing significant changes and workforce
adjustments and who fear job loss in the future.
These dislocated workers would be eligible to
receive three types of assistance: (1) transition-
assistance that includes skills assessment, counseling,
42
job-search assistance, and job referral; (2) training
assistance in the form of skill grants; and (3)
transition income support where necessary for workers
completing retraining.
I've also proposed a specially-targeted Youth
Skills Initiative.
A new Youth Training Corps will provide
economically and socially disadvantaged young people
with intensive vocational training through 55
residential YTC centers nationwide; these centers will
be located primarily in rural areas and will seek to
utilize converted defense facilities. The YTC will
draw from the military's high level of leadership and
training expertise by giving a hiring preference to
individuals leaving our armed forces.
I will also complement the YTC with a "Treat and
Train" program to strengthen existing youth drug
training programs.
To help meet the needs of young people not
planning to go on to college, I will expand the
National Youth Apprenticeship Program that I began in
January. This program offers high school juniors and
seniors a combination of classroom instruction and a
structured, paid, work-experience program. I want
student apprentices to receive both a high school
43
diploma and a widely recognized certificate of skill
competency. Students will also
have the opportunity to continue training at the
post-secondary level.
I started my Apprenticeship Program as a
demonstration program in 6 states; in my second term, I
will expand it to all 50.
Finally, I will more than double the size of the
present JROTC program, a very successful and popular
partnership between the military and schools. JROTC
emphasizes self-discipline, values, citizenship,
personal responsibility, and staying in school -- it's
a first class alternative to drugs and gangs. My goal
is to establish 2,900 JROTC units by 1994. Initially,
we will expand this program in inner-city high schools,
but I want to make JROTC available to every high school
across the country that requests it. This program is
another way in which we can relate the successful
experience of America's veterans to the next
generation.
B.
Affordable Health Care for All Americans
The economic security of men and women requires a
major reform of the U.S. health care system. The
present system provides high quality, high-tech
medicine, but at an unacceptable price: spending has
increased at a rate two to three times the rest of the
44
economy; thirty-four million Americans have no health
insurance; and millions more are afraid to change jobs
for fear of losing their health insurance.
My program will build on the strengths of the
system -- consumer choice, innovation, and state of the
art medicine -- while controlling costs and expanding
access.
I want to guarantee access to health insurance for
all poor families through tax credits {or vouchers for
those who don't pay taxes} sufficient to pay for a
basic health insurance plan ($3,750 for a family).
Other low and middle income families would get tax
relief to partially offset the cost of their health
insurance. In total, some 95 million Americans will
benefit.
My program also includes:
provisions that encourage small businesses to
develop less costly health care insurance
networks for their employees by combining
resources to achieve broader risk sharing,
economies of scale, and purchasing power;
"job lock" protection for employees and their
families so that they will not lose coverage
if and when a person changes jobs;
45
guaranteed insurability so that people with
"pre-existing" illnesses cannot be denied a
job or health coverage on the job;
100% tax deductibility of health care
premiums paid by the self-employed, as
compared to the present 25% deductibility;
malpractice reforms that will reduce the
number of unnecessary procedures performed on
patients and thereby reduce the cost of
medical care; and
reforms to encourage widespread use of
10.75
electronic billing to save an estimated $2
billion a year in paper costs.
Taken together, my program would cut health care
costs by $394 billion over five years through
preventive care, reducing defensive medicine,
malpractice reform, encouraging enrollment in
cost-effective health plans, arming consumers with
information about cost and quality, and eliminating
administrative waste and unnecessary paperwork.
I believe we can provide access to affordable
health care for all Americans, while preserving choice
for patients and their families in selecting doctors,
46
hospitals, health care programs, and employment. My
approach, in contrast with my opponent's, relies on the
private sector to deliver health care services. But I
would make the market work for us by enhancing
competition, which will cut costs. My malpractice
reforms would cut costs further by removing the fear of
lawsuits that leads to wasteful procedures.
I firmly believe that a move to national health
insurance, as some of my opponents want, would be a
major, irretrievable mistake. That course would turn
over the health care sector -- a full 13% of our
economy -- to the government. The result would be more
bureaucracy, rationed care, inefficiency, and, in the
end, even higher costs.
My opponent's "pay or play" approach winds up in
the same place as nationalized, bureaucratic health
insurance -- but through a different route. And it is
likely to kill a lot of jobs along the way. Increasing
the costs of labor -- the "play" in his approach --
will lead businesses to hire fewer workers. Offering
the alternative of government-sponsored health care
paid for with new taxes on payrolls -- the "pay" --
will dump the problem in the laps of government
bureaucracy with the costs paid for by businesses and
workers.
47
C. Pension Portability
I have also been concerned about the ability of
workers to preserve their retirement pensions as they
change jobs. This is a growing need because of the
increased likelihood that most workers will have more
than one employer over the course of their working
years.
I proposed an initiative last year to increase
pension portability, expand pension coverage, and
simplify the law governing pension plans. And I am
pleased that I was able to sign a law this summer that
incorporated the key elements of my proposal. The new
law enhances retirement security by permitting workers
to transfer accrued pension benefits directly to an IRA
or to their new employer's pension plan.
Despite this improvement, I believe we must
continue to look for ways to make it easier for workers
who change jobs to take pensions with them. We need to
eliminate incentives to "cash out" benefits and
increase incentives to save for the future.
Job training, affordable health care, retirement
security. When combined with a new system of education
and entrepreneurial, competitive business, we can offer
working men and women real economic security in the
21st Century.
48
IX. Leaving No One Behind: Economic Opportunity for
Every American
For over 200 years, the most exceptional aspect of
American society has been the belief, the hope, that this
is a land where people can make a better life for
themselves and their children. It's this spirit, the
commitment to the American Dream, that has made our
country and our society the most dynamic in the world.
If we are going to use that energy to drive us forward
into the 21st Century, we will need to tap the
aspirations of each and every one of our citizens. No
one should be left behind for want of opportunity.
Many of the programs that I have discussed above --
health care for all Americans, child care, job training,
pension portability, a new competitive school system
based on community involvement and choice for all
American families -- support my plan to empower all
Americans to make their own choices and better their
lives. But I believe we need to do more for certain
citizens who have fallen too far behind.
My philosophy for enabling all Americans to have a
piece of the American Dream is simple: it's based on
property and work. Our urban and welfare programs must
be designed to enable people to break the cycle of
poverty, get back on their feet, get back to work, and
49
take responsibility for their own choices and their own
lives.
DISAGREE
FAILED
My ideas are in direct conflict with the ^ logic of
AND ITS
ON
/
DISAGREE WITH THE
"welfare rights" that emphasizes entitlements. Nor do
strategies that
I favor "income maintenance" strategies that assume the
merely maintain poverty and contain potential.
problem of poverty is simply a lack of income that can
be made up by government.
NOT MORE DEPENDENCE BUT RATHER A NEW DECARATION INDEPENDENCE OF
Our goal should be to help^people INF develop the human
TO SHARE THE AMERICAN DREAM
and financial capital that enables them to become
TAKEN THE FIRST STEP
self-sufficient. We have made a start down this path
with our implementation of the welfare-to-work logic of
the Family Support Act of 1988. We have been encouraging
flexible and innovative implementation through waivers
that enable states to develop new programs to enhance
parental and family responsibility and to insist on
education and job training for those on welfare, Welfare policies won't
work, unless people
In our inner cities, we need to restore hope by do too.
?
clearing away the handicap of crime, building a core of
property owners, creating business incentives, restoring
infrastructure, and focusing our programs on work and
discipline.
Enterprise zones can create solid economic
foundations in distressed communities. Our "Weed and
Seed" effort can help reclaim and revitalize impoverished
and embattled communities by eliminating the fear of
drugs and violence, targeting coordinated human services
50
programs, and improving the housing stock and
infrastructure.
We also need to extend opportunity by enabling lower
income families to build assets -- for example, by
allowing aid recipients to accumulate higher savings
without losing their eligibility.
And we need to expand homeowner opportunities to
lower and middle income families. For example, HOPE
grants enable more inner-city people to own their own
homes. Our $5,000 tax credit for first-time home buyers
would help; so would permitting voucher recipients to
apply their rental subsidies toward the purchase of a
home.
We can enhance the choice, quality, and availability
of housing through affordable rent subsidies in the form
of housing vouchers, and through our "Perestroika in
Public Housing" program that widens opportunities for
public housing tenants to change the management of
troubled projects.
This property and work-based approach need not be
more expensive than the traditional welfare bureaucracy.
For example, over the past 12 years, federal spending for
low income assistance doubled even after inflation --
from $9.1 billion in 1980 to $18.3 billion this year
(both in 1992 dollars). This year, HUD is providing
housing assistance to 4.6 million low-income families,
51
TRIED TO RECHANNEL
up from 3.1 million in 1980. I have pressed to switch
some of this funding to vouchers because they are more
cost effective than constructing new public housing
units. Furthermore, families wouldn't have to wait five
years for the units to be built, and the vouchers give
families more choice.
THE KEEPERS OF THE KEYS IN
For too long, the barons of Congress have refused
FACE THE TRAGIC CONSEQUENCES OF
to discard failed programs that perpetuate welfare
No DOUBT
dependency. Originally, many of these programs were well
intentioned, and I respect those who tried them. But now
we know better. Give us a chance to try a different
approach that will empower people to help themselves, to
build some capital for their families, to make choices
that develop self-respect and discipline. That's the
real way to offer economic opportunity for every
American, to leave no one behind.
X. Keeping Government Slim
My blueprint envisages an important government role
to make a secure and strong America. But it is also
important that government not siphon off more private
resources than is absolutely necessary to perform the
functions that will help us win the economic competition.
SERVING ITSELF SECONDS
Because an GLUTINOUS overweight government -- one that serves the
RATHER THAN SERVING THE PEOPLE FIRST
special interests instead of America's interest -- will
WEIGH us DOWN
handicap our country in the race of a new era.
52
MUCH OF
A number of the items on my agenda can be
SIMPLY
accomplished by redirecting current funding away from
bureaucracies and towards people. My agenda empowers
people with the means to work, own property, build
capital, raise families, and be effective contributors
within our private market economy. Some of my ideas EVEN
--
for example, legal and health care reforms -- should help
us save money.
Contrary to the assertions of some politicians and
special interest groups, spending as a percentage of the
nation's GDP has been going up, not down. In 1991, the
Federal government spent 23.5% of what our nation
produced. That compares with 17.6% in 1965, 19.9% in
1970, 22.0% in 1975, and 22.3% in 1980. So not only has
government grown as the economy has grown, but government
is taking a bigger share. The American people are not
taxed too little. The American government spends too
much.
In my acceptance speech I noted some of the efforts
I will make to hold down spending. I have proposed
capping growth on mandatory spending, other than social
security. That would still permit spending at present
levels plus an adjustment for inflation and population
growth. Yet this cap would save $294 billion over five
years.
53
To start to implement this cap, I have proposed
almost $72 billion in specific spending cuts for
"mandatory" programs (FY93-97). If you add these
proposed cuts to others I have previously called for but
which Congress has not yet enacted, my specific cuts
would total about $132 billion over five years. I have
also proposed the outright elimination of 246 specific
discretionary programs.
By way of comparison, my opponent has specifically
proposed less than $5 billion in cuts in mandatory
programs. And he has specifically proposed to eliminate
only one program -- the honeybee subsidy program, which
Senator Gore voted to retain.
Furthermore, I proposed freezing all other spending,
and I will enforce this freeze by vetoing any bill
Congress sends me that spends more than I asked for in
my budget. BITTER EXPERIENCE BECOMES BETTER JUDGEMENT.
I've asked Congress for the line item veto, a
USED
disciplinary tool utilized effectively by the governors
of 43 states. This veto authority is important not only
A PRESIDENT'S
to help cut spending but to increase my leverage with
a Congress that seeks to tax more and spend more.
repet.
Government should be subject to the discipline of
a balanced budget amendment. State governments operate
that way. Businesses operate that way. Families operate
we
that way. And given the breakdown of Congressional
54
discipline, we need an amendment to ensure that the
too
Federal government operates that way. If we had such an
amendment earlier, we wouldn't be paying almost $200
billion dollars a year on interest for the debt left us
by earlier Congresses.
I also believe taxpayers should have the right to
direct 10% of their tax payments to reduce debt and
spending through a "check-off" on their tax forms. If
all taxpayers took the full 10%, the cut would be about
$50 billion. That's only 3% of the Federal budget of
about $1.5 trillion. Since federal spending has been
growing at a rate of about 8% per
year, even this proposed cut would still enable spending
to grow; it would just grow more slowly.
AS USUAL ,THEY KNOW BEST.
Some editorialists DISMISS slight my checkoff proposal, ^ but
AS USUAL, THEY KNOW BETTER.
the American people seem to like it" and I think I know
WEAVES
THROUGH THE
why. The checkoff MY proposal traces its roots to a
HISTORY OF
TRADITION
venerable tradition in American history. At the turn
of this century, many people were concerned that the
government establishment was slipping away from the
people it is supposed to serve. This movement led to a
SUCH VENERABLE "GIMMICKS'
number of innovations such as referenda, the right of
UNITED STATES
recall, and the direct election of senators. The idea
of term limits for Senators and Congressmen, which I
ALSO STEMS FROM OUR TRADITION
fully support, is another of this type of reform. At the
CHUCKLED AT
time each was proposed, the conventional thinkers mocked
(allit.)
Sophistic Sophistrates
55
the changes. The same is true today. Given the
COMPLETE PLETE
breakdown in spending discipline in Congress, it's time
that we insist on compensating reforms that give the
people a bigger say in the direction of Federal
government spending. I say it's time to give the people
the power to cut the deficit.
The size and structure of the Government also needs
THE
to be slimmed down and changed. Its organization of the
Federal Government reflects ways of doing business that
are now 30 to 50 years old. Companies all across America
have been restructuring, cutting costs, becoming more
efficient -- preparing to be more competitive in a fast-
changing marketplace. I believe the Federal Government
can and should do the same thing. I'll be talking more
about this later, but I believe a streamlining of the
Federal Government should include three elements:
First, I will cut the operating budget of the
Executive Office of the President by 33% if Congress
agrees to subject its operations to a cut of the same
size. With fewer Congressional staffers badgering the
Executive Branch, I know we can cut costs by that amount.
Second, I believe all federal employees earning above
$55,000 a year should be subject to a 5% pay cut; other
Americans have tightened their belts, and so should the
better-paid federal workers. Finally, I believe we can
restructure and reduce the size of the Executive Branch
56
through a consolidation of agencies and bureaus that will
enable us to do our job better. Why should the Federal
Government by the only large organization in America that
continually adds size and offices, and never gets rid of
anything? Therefore, I will submit a streamlined
reorganization plan for the Executive Branch to the new
Congress -- and I hope they take the hint, too.
Let me give you an example. In many respects, the
Arms Control and Disarmament Agency, or ACDA, is a
creature of the Cold War. It needs to adapt to the
times. Its highly trained scientists and engineers are
a valuable resource. Some of them can support our
efforts to stem and reverse the proliferation of weapons
of mass destruction. But others may be well suited to
work at defense conversion -- transforming the genius of
modern day swords into 21st Century plowshares.
Multiply this idea by a hundred, or even a thousand,
others. We can get ride of some tasks, conduct others
more efficiently, and add new ones where appropriate to
support my agenda.
I also am committed to reducing the tax burden on
the American people. I have said that I will propose to
further reduce taxes across-the-board, provided we pay
for those cuts with specific spending reductions that I
consider appropriate, so that we do not increase the
deficit.
57
No
To give you a an illustrative sense of the kinds of
HAVE IN MIND
tax cuts we could achieve if we discipline spending, just
consider what we could do if Congress acted on the $130
billion in specific spending reductions that I have
already proposed. These savings alone could finance an
across-the-board rate cut of 1 percent, a reduction of
the small business tax rate from 15% to 10%, an increase
in small business expensing of investment in equipment,
and a reduction of the capital gains tax.
In sum, my direction is clear -- I want to spend
less and tax less. My opponent wants to spend more and
tax more.
I believe the Federal Government can reallocate its
almost $1.5 trillion in spending more effectively if we
implement my agenda. The reductions in defense spending
that we have already begun will provide some of these
funds, and I don't want them wasted in a torrent of new
spending programs designed by a horde of special
interests.
I honestly believe that this is the only way to get
the size and spending of government under control. I
know that serious-minded people believe we need to
increase revenues to close the deficit. But it won't
work. I have seen too many times that efforts to close
the deficit by increasing taxes have only turned out to
give Congress a license to spend more money. There's a
58
reason for this. Spending is power for Congressmen.
That's how they show influence, placate interest groups.
That's how they get elected. If you give them more tax
money, they will spend it.
XI. A Strategy for Implementation
This year is an important turning point for the
United States. We are entering a new era, and for the
first time in many years, it appears that Congress will
have 150 new faces for the President to work with.
That's why I'm asking for a mandate for my program.
That's why I have promised that I will meet with all new
members -- all 150 or more -- before they are besieged
by the special interests and permanent staffs.
I also believe we need to take another step to
ensure that the new Congress does not become like the old
one. The root of the present problem is political
contributions from organized special interests through
political action committees, or PACS. Ten years ago,
PACs raised and contributed $ million to political
candidates. This year the number will be closer to $
million. The other party doesn't want to do anything
about it, because they are the biggest recipients. I
want to put them to the test. I want a new Congress to
stay clean. So an important part of my new legislative
59
agenda will be a simple bill that bars all contributions
by PACS.
I am committed to make my program work with
Congress. Between the election and the convening of a
new Congress, I will lay out an implementation plan for
my agenda. I intend to be ready to present the new
Congress a first-year plan to carry out the legislative
proposals described in this agenda:
A tax cut package, including a cut in the
capital gains tax, to spur entrepreneurial
capitalism and small business
My health care reforms
My job training programs
A radical overhaul of American education to
emphasize excellence, standards, competition,
entrepreneurial schools and a "G.I. Bill for
Kids" that will give parents a choice of
schools.
NAFTA
A package to cut spending, including a Balanced
Budget Amendment
More general tax cuts paid for through new
spending and growth
60
A government reorganization plan to streamline
the structure, ensure functions to fit new
needs, and cut salaries at higher levels
Reform of our legal system
A package to clear away crime, build business,
and put people to work in our inner cities
An expansion of Civilian R&D linked to new
applications
New trade negotiating authority
Ban on PAC contributions
Now I know I may not be able to get everything I
want in the exact way I want it. But your support for
a mandate to get it done would give me momentum. And
then I intend to fight for this agenda, fight as hard as
I can to get as much as I can, and come back again to get
more.
If Congress hesitates on some fronts, I intend to
keep moving forward. You have seen that we can implement
back-to-work welfare reform by granting waivers that
enable the states to do the job more effectively.
Similarly, 44 states and more than 1700 communities have
started to implement my educational reforms while
Congress has stalled. We can get a great deal done at
the state and local levels.
61
I will work with governors, state legislatures,
local governments, and the private sector to pursue my
agenda. While I want a Congress that can help me do the
job, I'm committed to getting the job done one way or the
other.
This is my Agenda for American Renewal. With the SPOILS
CAN BE PEACE PROSPERITY & PROMISE.
end of the long Cold War, we can direct more energy and
resources to target problems at home. The American
people want that. The American people deserve that.
At the same time, Americans recognize that the great
events of recent years have shook the world, and it will
never be the same. If we are to succeed as a nation and
as a people, if we are to hold true to all that has made
America the last, best hope on earth, then our renewal
at home must at the same time enable us make the 21st
Century another American Century.
My Agenda draws together our people and our
government to take on this challenge. We will create a
$10 trillion economy. We will renew America. We will
win the peace.
My approach to this challenge is fundamentally
different from my opponent's. I want to stimulate
entrepreneurial capitalism. I want to help people by
enabling them to make their own choices about health,
62
education, job training, and child care from a variety
of competing alternatives. I want to supply services
through the private sector. I believe people should sue
each other less and care for each other more. I want
Government to spend less and tax less. I will fight
without hesitation for a free and fair flow of trade,
capital, and ideas around the world. I believe America
should compete, not retreat.
I know times have been tough for too many Americans.
The world yoward I knew as child in will never he the same
I have sought to explain the causes of these problems and
what I will do about them. Of course, you will have
KIND
change. The question is what type of change. You face
a serious choice. And I ask, when you step into that
voting booth, please consider carefully which candidate's
agenda for change fits best with your beliefs, America's
our hopes for
experience, and lasting peace and prosperity.
63
APPENDIX A: Some Facts About the American Economy
The average unemployment rate during my term has remained
below the average of the Carter years and puts us well
ahead of G-7 partners like Canada, Britain, and
France -- where unemployment rates are 10% or higher.
Average family income reached $42,652 in 1990,
$15,000 more than before the expansion began.
A recent study by the Urban Institute
concluded: "When one follows individuals rather
than statistical groups defined by income, one
finds that, on average, the rich got a little
richer and the poor got much richer
This
pattern, however, may be surprising to the
general public which has been led to believe
that the poor were literally getting poorer
over the last decade or two, and that the
incomes of the rich were skyrocketing. That
is simply not true." "
More than half the people making up the lowest
fifth of the income distribution in the late
1970s, moved up the income ladder and out of
that category over the next ten years.
64
Moreover, the middle class shrank because more
of them moved above the $50,000 threshold and
into the high income groups --they weren't
moving down.
Real per capita income rose 15.7% during the
'80s. {Consider a substitute statistic}
All major demographic groups shared in the
economic growth. Between 1982 and 1991,
employment of Blacks was up 29% and Hispanics
52%. The employment-to-populatior ratio for
Black Americans during my tenure has averaged
a record 55.7%, up 52.8% during the Carter
years.
Since 1980: life expectancy has increased from
73.7 to 75.3 years; the infant mortality rate
has dropped from 12 to 10.1 for 1,000 live
births; deaths from heart diseases have dropped
from 202 to 166 per hundred thousand people,
an 18% decline; deaths from strokes and related
diseases have dropped from 40.8 to 29.7 per
hundred thousand people, a 27% decline.
65
Our 1993 Budget request for Childrens' Programs
reflects an increase of 66% since 1989; we
recommended funding of $100 billion for
programs assisting children in
.
From 1980 to 1991, Federal support for
Education increased 59%, to $54.6 billion. The
total volume of guaranteed student loans grew
from $4.6 billion in 1980 to $11.5 billion in
1991 -- an increase of almost 150%. One of
every two students at 4-year public
institutions gets a federal student loan or
grant.
During the 1980s, expenditures per student in
public elementary and secondary schools rose
from $2,502 to $5,266, an increase of 110%.
The United States is spending more per pupil
than any other country except Switzerland.
Federal investments in biomedical research have
almost tripled since 1980, reaching a level of
$9.4 billion in 1993.
Since 1989, we have increased AIDS research
funding by 39%, to over $1.2 billion dollars;
66
AIDS prevention funding by 29% to $621
million;, and AIDS treatment funding by 240%
to $2.5 billion.
Total public investment in infrastructure in
the 1980s grew 2.2% annually, roughly equal to
the growth of the 1960s and greater than the
growth of the 1970s.
Since 1989, Federal spending for infrastructure
has increased at a nominal average of 6%
annually. And I signed into law a Surface
Transportation Act that will support over one
million jobs per year while strengthening our
road, rail, and air transport systems.
Government investment in R&D is at a record
level of $76 billion.
Spending on Federal law enforcement has grown
from $4.8 billion in 1981 to an estimated $15.8
billion in 1993. This has paralleled a
dramatic 22% decrease in the national crime
rate over the same period:
-- Rape decreased 33%
-- Robbery was down 24%
67
-- Assaults fell by 14%
-- Theft was down 25%
According to the National Institute on Drug
Abuse, the current use of any illicit drug by
Americans age 12 & over dropped 10.8 million,
or roughly 45%, between 1985 and 1991. Our
National Drug Control Strategy helped cut
overall drug use by 13% and adolescent use by
27%.
The Federal budget for environmental programs
more than doubled since we took office. And
we have proposed a 22% increase -- an added
$3.4 billion -- for 1993.
The U.S. currently spends more on pollution
control than any other country in the world,
devoting at least $115 billion annually, worth
2% of our GDP. That's why during the past two
decades:
-- Lead pollution is down 96%
-- Carbon monoxide poisoning is down 41%
-- Water pollution {suspended solids}
is down 80%
68
-- Sulphur dioxide pollution
{contributes to acid rain} is down
25%
With the new Clean Air Act, which I promised
in 1988 that we would achieve, we will cut acid
rain emissions in half, reduce smog in our
cities, and cut air toxic emissions by 75%.
By pressing for and achieving the Americans
with Disabilities Act, another promise from
1988, we will bring almost 43 million disabled
Americans into the economic mainstream.
All major categories of exports gained during
my term. Exports of industrial supplies
increased by 22%, capital goods by 45%,
automotive by 26%, and consumer goods by 98%.
U.S. export growth under my leadership has been
roughly twice the rate of the other G-7 major
industrial countries.
Agenda
for American
Renewal
by Gy Bush Bush
George Bush
President of the United States
Agenda
for American
Renewal
1
I.
In wartime, the costs of
Government are always high.
Introduction:
"We are a nation at
Domestic needs are not fully
The Challenge
met. In times of conflict, a
peace. But being at
good nation tries to look after
America stands at the
its poor, its sick, its elderly, its
peace with others and
edge of a new era, a new cen-
less privileged members, but
being at peace with
tury. Here is my bridge to the
not as completely as it should
other shore: An Agenda for
or would like to.
ourselves are different
American Renewal - diagnos-
things. The one we have
ing the economic problems we
Today, this year, for the
face, setting forth the princi-
first time since December
achieved. The other, we
ples to guide our actions, and
1941, the United States is not
can and will."
explaining the approach I am
engaged in a war, hot or cold.
pursuing.
We are a nation at peace.
Over past weeks I have
But being at peace with others
been discussing some of the el-
and being at peace with our-
ements of my economic agen-
selves are different things.
da. In coming weeks I will be
The one we have achieved.
expanding on my ideas. This
The other, we can and will.
document shows how the
pieces fit together.
The American people rec-
ognize this historical water-
It is important to step
shed. They want and deserve a
back for a moment, to take
peacetime system of taxation,
stock of where we are as a
a peacetime freedom from un-
great nation in the broader
necessary intrusion into our
sweep of history.
lives, a peacetime commitment
to sound money, a peacetime
The American people have
dedication to unfinished work
just completed the greatest
and unsolved problems close to
mission of all, the triumph of
home.
democratic capitalism over
imperialistic communism.
At the same time,
Mission accomplished.
Americans are aware of epic
changes in the world and the
Throughout history, when
economy. They sense the dis-
long wars end, people have
quiet in many of the industri-
been confronted with the prob-
alized democracies that have
lems of converting to peace-
been our partners in the long
time and establishing a new
struggle. Our own economy
basis for securing peace and
has been going through some
prosperity.
profound changes. And I un-
2
derstand how difficult change
In this country, we have
I will sharpen the competi-
can be, particularly for those
always preferred an entrepre-
tive edge of our businesses by
who feel its effects most direct-
neurial capitalism that grows
encouraging entrepreneurial
ly. Americans sense we face an
from the bottom up, not the
capitalism and small business,
era of great opportunity, but
top down, a capitalism that be-
deploying advances in R&D
that there are also great risks
gins on Main Street and ex-
and technology, and reforming
if we fail to choose wisely.
tends to Wall Street, not the
our legal system so it no
other way around.
longer puts us at a global dis-
We must now demonstrate
advantage.
our unique ability to trans-
Nor have we been taken in
form anxiety into regenera-
by the view my opponent
My agenda promotes eco-
tion. Only in America do we
prefers, that Government
nomic security for working
have the people, the resources,
should accumulate capital -
men and women through job
the economic strength - and
by taxing it and borrowing it
training that will ease adjust-
especially the principles and
from the people, and investing
ments and provide people with
ideals - to pick up the chal-
it according to some industrial
new capabilities for work in
policy design.
the face of competition and
lenge
change. And I will enable fam-
For America to be safe and
My agenda is for an inclu-
ilies to concentrate on building
strong we must meet the
sive America, not an exclusive
for the future by giving them
defining challenge of the '90s:
America - and certainly not,a
the means to protect them-
to win the economic competi-
reclusive one. We will chal-
selves against today's cost of
tion - to win the peace.
lenge the world with an inter-
health care, and by making it
national economic and trade
easier to build tomorrow's re-
The United States must be
strategy that will promote free
tirement security. I want our
a military superpower, an ex-
trade arrangements east and
efforts to reach out to all our
port superpower, and an eco-
west, north and south, to
citizens, leaving no one be-
nomic superpower.
strengthen our global econom-
hind, because we will need the
ic reach and complement our
work, aspiration, and energy
My approach is to look
worldwide security presence.
of each and every American.
forward - to open new mar-
At the same time, we need to
kets, prepare our people to
foster the capabilities at home
Finally, since our competi-
compete, to strengthen the
that will keep us in the lead.
tive strength and entrepre-
American family, to save and
neurial spirit must flow from
invest - so we can win.
Developed economies need
the private sector, I will
developing minds. To help pre-
streamline Government to
This future depends on
pare all our children for a con-
meet changing needs.
economic growth, but not for
stantly changing workplace, I
the few at the expense of the
want to make radical changes
We can empower America
many, not for the present at
in our education system. Each
to reach a grand goal: a $10
the expense of the future.
child should graduate with
trillion economy by the first
skills, self-discipline, and self-
years of the 21st Century.
confidence.
3
When President Reagan
race, we are now able to do
and I assumed office in 1981,
something we have all hoped
the U.S. economy was about
for since the close of World
"The first great
$3 trillion. We've almost dou-
War II - lighten the load of
change in our economy
bled that over the past 12
the defense burden.
years So I know we can nearly
is ironically due to our
double it again through sus-
In the short run, this ad-
very success in ending
tainable real growth over the
justment has meant cutbacks
coming decade.
and lay-offs in many indus-
the Cold War.
tries that have depended on
we are now able to
With a $10 trillion econo-
defense spending. We must
my, we could provide the re-
ease this transition. But in the
do something we have
sources, private and public, to
medium and long run, reduc-
all hoped for since the
satisfy our most ambitious so-
tions in defense spending will
cial and financial require-
free up many new resources
close of World War II -
ments. We could simultane-
for our people and economy.
lighten the load of the
ously renew America and pay
down our national debt.
Second, it seems that al-
defense burden."
most every time you open the
So now let me turn to how
business pages you can find a
we can meet the challenge and
story about a major U.S. cor-
reach our goal.
poration that is restructuring
itself. Our industries are in
the process of transforming
II.
themselves from old-style hier-
The Context:
archical organizations to so-
called "flattened pyramids."
Five Changes
This new industrial organiza-
Underway in the
tion emphasizes a skills-based
Economy
workplace, "lean production,"
a "just in time" inventory, and
The U.S. economy has
short product cycles rather
been working its way through
than mass production. Our
five profound changes. They
companies are integrating
establish the context for my
R&D, manufacturing, and
agenda.
marketing into a seamless web
of innovation. This is a revolu-
The first great change in
tion as dramatic as the one
our economy is ironically due
when Henry Ford led the
to our very success in ending
country from craft-based pro-
the Cold War. Since our super-
duction to mass manufactur-
power rival of the last half
ing early in this century.
century has dropped out of the
4
We have to make these
created over 21 million jobs,
entered the 1980s with some
adaptations succeed if
more than all the new jobs in
14,000 commercial banks and
America's industries are to
the other major industrial
4,600 savings and loans. In
keep ahead of their interna-
countries and the rest of
comparison, Canada had about
tional competitors. Strong
Western Europe combined. Yet
160, and Japan had under
sales and productivity increas-
great booms produce excesses,
100. The vast majority of those
es are the prerequisites for
and this time too many compa-
small U.S. banks and S&Ls
creating more jobs, boosting
nies, too many financial insti-
operated in a heavily con-
wages, and upgrading
tutions, and too many house-
trolled environment where
benefits. In fact, it is partly be-
holds took on too much debt.
their costs of funds were limit-
cause of these changes that
ed by ceilings on your pass-
our annual growth in manu-
We have been paying
book accounts. Other regula-
facturing productivity over the
down that debt - and lower
tions restricted competition by
past 10 years was over 50%
interest rates have helped us
imposing costs and inefficien-
higher than in the Carter
do it. Millions of people have
cies on savers and borrowers.
years. It's why American firms
refinanced homes at lower
lead the world in exports.
rates, reducing mortgage pay-
In the late 70s, this out-of-
ments by as much as $1,200 to
date system was buffeted by
Nevertheless,
these
$1,500 a year. When compa-
record intèrest and inflation
changes also have produced
nies restructured, they paid
rates; it was challenged by
layons and relocations among
down debt, strengthened bal-
competition from new financial
both blue and white collar
ance sheets, and positioned
services. As in any other line
workers. Middle-aged bread-
themselves to enjoy greater
of business, the less efficient
winners are wondering
profits when stronger growth
institutions could not survive.
whether their company will be
resumes. This process will
But because our banks and
the next to make announce-
leave our economy leaner and
S&Ls held insured deposit ac-
ments, and they worry about
more powerful. Many firms al-
counts for most hardworking
their jobs, health care, and
ready are. But while that debt
Americans, the streamlining
pension rights. Some are also
was being paid down, people
process had to be managed in
troubled by the prospect that
bought fewer goods, and com-
a way that enabled the
after sacrificing to send their
panies put less money into
Government to protect your
kids to college often the
new investments and jobs. The
savings. In effect, the
first generation to attend -
process is largely over, but it
Government picked up these
that these children's diplomas
has left consumers and compa-
costs so your savings would be
may not be golden tickets to
nies a little cautious.
safe.
security.
Fourth, we entered the
This process, too, is near-
Third, the 1980s wiped
'80s with a banking system de-
ing its end A strong economy
away the dismal economic per-
signed 50 years earlier - an
must have a good banking and
formance of the late '70s. We
incongruous relic in an era
financial system so entrepre-
enjoyed the longest peacetime
when billions of dollars can be
neurs can get capital, busi-
expansion in U.S. history, last-
sent around the world in a mi-
nesses and farms can get
ing seven and a half years. We
crosecond. The United States
loans, and families can buy
5
homes and cars. We will have
Two, it means that if
a more competitive and effi-
America is going to be strong
"No
nation is an
cient financial system that will
and growing in the 21st
serve companies and families
Century, we must be ready,
island today. We are
better. Over the next few
able, and willing to compete
years, the Government will ac-
around the globe. We need to
part of a global
tually gain revenues from the
encourage entrepreneurial
economy. To grow is to
sales of billions of dollars of
capitalism and investment at
assets that it acquired from
home, and at the same time
trade; to expand is to
banks and S&Ls as it protect-
ensure that our labor force re-
compete. One
ed savers. But this process has
mains the best in the world.
left lenders cautious. Business
manufacturing job out
borrowing rates and mortgage
Three, we need to seize op-
of every six depends
rates are way down, but it's
portunities to develop new
still too hard for small busi-
markets, particularly in areas
directly on our exports.
nesses to gain access to capital
that have potential for
One acre out of every
and credit. We are still taxing
significant growth in the fu-
capital too much.
ture. One of the other benefits
three is sowed for sale
of the end of the Cold War is
abroad."
The final economic change
the extraordinary potential to
is perhaps the most far-reach-
expand trade and sales to hun-
ing of all: No nation is an is-
dreds of millions of potential
land today. We are part of a
customers who not long ago
global economy. To grow is to
were the captives of our
trade; to expand is to compete.
enemies.
One manufacturing job out of
every six depends directly on
our exports. One acre out of
III.
every three is sowed for sale
Start with
abroad.
Strengths
This international econom-
ic interdependence has three
In developing an agenda
for the future, we should take
implications.
a clear-eyed look at our
One, when growth slumps
strengths as well as weakness-
abroad, it drags our economy
es. Not surprisingly, the other
down with it. Both Western
side has conveniently skipped
Europe (especially Germany)
over our country's many
and Japan are going through
strengths. Frankly, they want
major readjustments - and
you to believe America is over
that has contributed to our
the hill and past its prime. But
sluggishness.
they have no more right to
6
convince you the economy is
own homes, as compared
falling. We must know our
worse than it is for political
with 59% in Japan and
strengths before we build on
advantage than I have to un-
40% in Germany.
them. Over the past 12 years,
derstate the problems. So let
we increased the U.S. economy
me just note several key facts.
The U.S. sends more of its
by about $2.8 trillion - that's
students on to higher edu-
like creating the total size of
The Misery Index - the
cation - 68% - than any
the German economy twice
sum of inflation and unem-
other country, well above
over. So I know our goal of a
ployment - is down to
the 32% rate in Germany
$10 trillion economy is attain-
10.8% today, from 19.6%
able.
and 30% in Japan. And
in 1980.
52% of these U.S. students
are women, as compared
We're also in a strong posi-
Inflation has fallen to
with 26% in Japan and
tion internationally. But we're
roughly 3%, the lowest in
38% in Germany.
going to need the national
adaptability and capability to
a quarter of a century (ex-
keep leading our competitors.
cept for 1986).
With exports of $622 bil-
And we must have the courage
lion, the U.S. is the world's
of our convictions to say "no"
Interest rates are at a 20
largest exporting nation.
to the wrong sort of changes
year low. Mortgage rates
Exports increased by 40%
for the future - false promis-
are now in the 8% range,
during my Administration.
es based on false premises -
half the rate President
changes we cannot afford at
Reagan encountered in his
We produce 25% of the
this key moment in the world
first year. Thanks to these
world's total output with
economic competition.
low rates, more people can
5% of the world's popula-
afford to own a home today
tion.
than at any time since
IV.
1973.
The productivity of
Guiding
American workers is ap-
Principles
While unemployment is
proximately 26% above
still far too high, the share
those in Germany and 30%
Before outlining the
of the working age popula-
above those in Japan.
specifics of my agenda, I want
tion with jobs during my
to set out four guiding princi-
administration has aver-
I do not mean to suggest
ples. An effective strategy
aged 62.2%, the highest in
either that everything is well
must be dynamic. As new
U.S. history.
or that we do not need to lead
problems or opportunities pre-
and manage the changes tak-
sent themselves, we will need
The United States has the
ing place in the world and at
to make adjustments. Guiding
highest home ownership
home more actively. We do.
principles will ensure we fol-
rate of all major industri-
low a consistent path and help
alized countries: 66% of
But you can't chart the
shape our policies into the
U.S. households own their
stars if you think the sky is
future.
7
First, start with the ba-
for helping people, for re-
sies: We are a nation of special
sponding to their needs. And
individuals, not special inter-
we've seen that these are ap-
We have to keep to
ests. Individuals gain primary
proaches that work.
the fundamentals of
strength, protection, and in-
spiration from their families
We prefer a hand up to a
sound economic
and communities, not the legal
handout. We want to empower
growth: lower tax rates,
system or Government social
people to make their own
services. People find their
choices, to break away from
limits on Government
friends and their enjoyment in
dependency. We want to give
spending, greater
voluntary association with
individuals and families eco-
one another, not in some bu-
nomic security by giving them
competition, less
reaucrat's paint-by-numbers
the capital, the capabilities,
economic regulation
dream.
and the confidence to decide
for themselves. We want
sound money, and more
Individuals, families, com-
everyone to have a stake in so-
open trade that canfree
munities. That's where we
ciety, to own property, so
start.
everyone will build something
tremendous private
with it for themselves and our
Second, we have to keep to
country. Whereas my oppo-
initiative and growth."
the fundamentals of sound
nent's approach may place a
economic growth: lower tax
premium on redistribution and
rates, limits on Government
"leveling," our programs will
spending, greater competition,
unleash initiative, reward suc-
less economic regulation,
cess, and encourage excel-
sound money, and more open
lence. Our approach is to give
trade that can free tremen-
people the power to work,
dous private initiative and
save, and be their best.
growth.
Finally, all our policies
Experience has shown that
must be brought together ef-
these are the steps we need to
fectively if we are to prosper
take to create jobs, raise
as a people and succeed as a
wages, spur entrepreneurs, ex-
nation. America must have ap-
pand capital and investment,
propriate new approaches for
and build businesses.
the changes at home - just as
we've launched new policies to
Third, in the '90s Govern-
lead and manage change
ment can build on these fun-
abroad. We must recognize the
damentals by offering opportu-
interrelationship between do-
nity and hope for individuals,
mestic and foreign policy -
families, and communities.
between economic and security
There is a conservative agenda
policy. At the same time, we
8
must execute our agenda more
This is how America will
excellent American customers.
effectively with a new
create a $10 trillion economy.
Equally important, the inte-
Congress, state and local gov-
gration of United States,
emments, and the private sec-
Mexican, and Canadian capa-
tor. Our aim must be to press
V.
bilities will improve our global
our policies together, as a
package, to make America se-
Challenging
competitiveness by enabling
cure and strong.
the World:
American firms to purchase
inputs at lower costs. This will
A Strategic
help U.S. firms to stay in the
Therefore, my Agenda for
Global Economic
forefront of high wage, high
American Renewal mandates
and Trade Policy
value-added production.
action on six interconnected
fronts. Because we face com-
plex problems, no one solution
During the Cold War, we
Our geopolitical position is
will suffice. The whole of these
built a global security struc-
also advantageous. The United
ture to contain and counter
States is both a Pacific and a
elements will be a solution
the Soviet Union and commu-
European power; our political
greater than the sum of its
nist aggression. We forged mil-
and security ties link us with
parts:
itary alliances across the
the largest and most rapidly
Atlantic and Pacific that un-
growing economies across both
Challenging the World: A
derpinned that structure. In
oceans. Our trans-Pacific trade
Strategic Global Economic
the post-Cold War era, we
already exceeds our Atlantic
and Trade Policy
need a strategic global eco-
trade; that's one reason why
nomic and trade policy that
we helped launch an organiza-
Preparing Our Children
will ensure our position as an
tion for Asia-Pacific Economic
for the 21st Century
economic and export super-
Cooperation that will further
Economy
power as well.
strengthen our economic ties
with that region. Our own
Sharpening Business'
We are well positioned to
neighbors - from Central
Competitive Edge: En-
achieve this goal. We enjoy the
America to Chile - want to
largest fully integrated market
build bridges of trade with us
couraging Entrepreneurial
in the world; this gives us
so they can build better
Capitalism
leverage with other countries
economies for their people.
that want access to our mar-
Promoting Economic Se-
ket. Once the Congress enacts
"The ball of liberty,"
curity for Working People
the North American Free
Jefferson once wrote, "is now
Trade Agreement (NAFTA),
so well in motion that it will
Leaving No One Behind:
our position will be further
roll around the globe." He was
Economic Opportunity for
strengthened. NAFTA will
right
Every American
open an important market, a
Mexican economy whose
Freedom has rolled
growth prospects will quickly
through Eastern Europe, the
"Rightsizing" Government
transform its expanding in-
former Soviet Union, and
dustries and consumers into
Latin America - and the ball
9
is now in our court. Free peo-
1993 because of those special
ple and free markets develop
interests who herd together
hand in hand. People value
with a protectionist purpose.
"Free people and free
American values. People want
The global trade negotiations,
to buy what we have to sell.
markets develop hand
in turn, could be very close to a
English is the language of
breakthrough if the United
in hand. People value
freedom and business.
States continues to act as a
American values. People
strong world leader. There is a
Our political and economic
proposed draft text that estab-
want to buy what we
ties are complemented by the
lishes the outlines of a
have to sell.
appeal of American culture all
significant new GATT agree-
around the world. This is 8
ment. Once we assure cuts in
new "soft power" we can em-
the subsidized agricultural
ploy. Today, our movies,
trade along the lines of that
music, and videos are among
text - to enable our farmers to
our top-selling exports.
secure their competitive advan-
tage - I believe we will be able
Finally, as the primary
to complete the Uruguay
founder and the most signi-
Round agreement.
ficant proponent of the GATT
global trading system, we con-
An improved global trad-
tinue to have a strong hand as
ing system is, however, only a
long as we use it to truly open
base for freer trade, for
markets, including our own.
stronger investment ties, for
The key to America's growth,
increased global growth. We
expansion, and innovation has
need to start to develop a
always been our openness to
strategic network of free trade
trade, investment, ideas, and
agreements [FTAs] across the
people.
Atlantic and the Pacific and in
our own hemisphere. This net-
Therefore, the next steps in
work will stand in sharp con-
my strategic trade policy are to
trast to the backward blocs of
secure Congressional agree-
economic isolation. If we are to
ment to NAFTA and to com-
be a true export superpower,
plete the global trade negotia-
we cannot be tied down to one
tions - the so called Uruguay
region. Instead, my intent is to
Round negotiations in GATT.
use our attractive domestic
Our NAFTA agreement will
market as the basis of a mus-
open doors for American busi-
cular free trade policy that
nesses, workers, and con-
will strengthen America's
sumers. It will create good jobs.
global economic reach and
Nevertheless, I expect a tough
complement our worldwide se-
fight in the Congress in early
curity presence.
10
By focusing on opening
slovakia by the end of my sec-
will ensure that our
markets, I also believe we can
ond term. And I would explore
ExTm Bank and the Overseas
reduce structural barriers to
the possibility of a connection
Private Investment Corpora-
competition in North America,
between NAFTA and the
tion (OPIC) work with teams
Western Europe, Japan, and
ASEAN FTA, or AFTA It will
of our ambassadors to develop
elsewbere. Competition will
not take long for other coun-
trade and investment opportu-
encourage entrepreneurial
tries to begin to express their
nities for U.S. firms. We've al-
capitalism - at the expense of
interest in new trade and busi-
ready begun this with the six
entrenched interests -
ness ties with us. For example,
ASEAN countries - and it's
spurring even greater global
leaders in Australia and Korea
working. I will particularly
growth
have already spoken of their
stress helping America's small
interest in forging closer eco-
businesspeople to develop
More specifically, I will
nomic ties.
trading opportunities. These
need to secure from the
companies look small - but
Congress additional trade ne-
Some see new threats, oth-
they trade big. I know. I start-
gotiating authority within the
ers see old enemies. I see new
ed my own. And I have visited
first half of 1993. To overcome
markets, new opportunities,
small factories all across the
the special interests and the
new jobs.
United States that first sur-
protectionists, I will need a
vived and then prospered by
mandate from the American
As we develop this eco-
taking on the foreign competi-
people If America is going to
nomic and trading network for
tion. I know Americans can do
be an export and economic su-
the 21st Century, I will fight
it.
perpower, the U.S. President
hard to promote American
must take a strong stand on
trading interests. For exam-
the negotiation of trade and
ple, I am committed to a siz-
VI.
economic agreements. The
able Export Enhancement
Preparing Our
Congress will read vacillation
Program [EEP] to ensure that
Children for the
and equivocation as weakness,
our farmers can go head-to-
and the national interest will
head with the European
21st Century
lose out to the logrolling trade-
Community's subsidized agri-
Economy
offs of Congressional business
cultural exports. We know
as usual. That's one very big
from our experience with mili-
In the 21st Century our
issue at stake in this election.
tary security that the key to
greatest national resource will
economic security must be
be our people. Materials, ma-
With new negotiating au-
based on "Peace Through
chines, and methods will come
thority, I will pursue new
Strength" - not unilateral
and go, but the American
trading and economic opportu-
disarmament. That's why I re-
worker will remain the key to
nities in Latin America under
cently announced the largest
our economic security. Since
my Enterprise for the
quantity of wheat ever avail-
the workplace of the 21st
Americas Initiative, starting
able under our EEP program
Century will be constantly
with Chile. I would also like to
- almost 30 million metric
changing, we need to prepare
work towards FTAs with
tons to 28 customers.
the American people to adapt
Poland, Hungary, and Czecho-
to and direct the process of
11
change. Therefore, our kids
tion Assistance program (WIC)
must arrive at school ready to
has grown 258% between 1980
grow, and they need schools
and 1992; my request for an
Materials, machines,
where they will learn how to
additional $240 million for
and methods will come
keep learning all their lives.
1993 brings the annual cost to
$2.8 billion.
and go, but the
Our New American
American worker will
Schools will help prepare our
I have also increased fund-
children to become the con-
ing for the Head Start pro-
remain the key to our
tributing citizens of tomorrow.
gram by 127% - for a total of
economic security. Since
Equally important, we want to
$2.8 billion in 1993. That in-
enhance children's sense of
cludes an additional $600 mil-
the workplace of the
self-worth, their confidence,
lion increase for next year -
their sense of participation in
an unprecedented 27% annual
21st Century will be
a larger community and soci-
jump - so that a year of Head
constantly changing, we
ety. This is the conservative
Start will be available for
philosophy of empowerment,
every eligible four-year old
need to prepare the
helping people to help them-
whose parents want to partici-
American people to
selves.
pate. (Under my budget, al-
most 800,000 children will re-
adapt to and direct the
I want to do my best to
ceive 8 year of Head Start be-
process of change.
help all children come into the
fore entering elementary
world as truly "created equal."
school.)
Therefore, our kids must
That's why I am more than
arrive at school ready to
doubling funding for a Healthy
Child immunizations are
Start initiative that targets
also vital to safeguard our
grow, and they need
communities with high infant
kids' health. Every year since
schools where they will
mortality rates. We are also
1981-82, 95% or more of the
increasing prenatal care, nu-
children entering elementary
learn how to keep
trition services, and substance
school have been immunized
learning all their lives.'
abuse treatment for pregnant
against the vaccine-pre-
women And I want everyone
ventable diseases. Now we are
to spread the word that every
focusing greater attention on
parent must share the gift of
preschool children. My 1993
good health with their chil-
budget calls for an 18% in-
dren.
crease in child immunization
grants.
We need to focus especial-
ly on the preschool years, so
I want the United States
that children coming to school
to offer opportunity and en-
are healthy and curious.
courage excellence; we must be
Funding for the Women,
fully capable of competing in a
Infants and Children Nutri-
global economy. Therefore, it
12
is imperative that our educa-
meet world-class standards.
school choice off the adminis-
tional system prepare and
We are moving ahead with the
trator's desk and put it back
point the way for our children.
development of these stan-
on the kitchen table. Choice is
As in the past, education
dards in math, science,
critical to the success of the
should be the ladder that the
English, history, geography,
whole, integrated overhaul of
child of modest means can
arts, and civics.
our educational system.
climb to better him or her self.
Competition, the underlying
Second, we need voluntary
principle for this radical re-
Our current school system
national achievement tests to
form, will not work unless we
is falling short of these needs
measure the progress of our
give consumers the ability to
- and the poor are hurt most
students. That way we can
choose.
Only 19 out of 66 public high
compare the performance of
schools in Chicago graduate
different schools in helping
Wealthy families already
more than half their students,
our children achieve the na-
have this choice for their chil-
and many of these graduates
tional standards.
dren. Many of the people that
can barely read or write.
you saw at the Democratic
Third, we need to give
National Convention have this
Our educational establish-
schools the flexibility to be-
choice for their children. Why
ment is caught in a sort of
come educational entrepre-
shouldn't you have this choice
time warp, a system created
neurs - to figure out the best
for your children?
for another age when the
ways to motivate our children,
needs were not the same, chil-
use technology, include par-
Chicago's public school
dren grew up differently, and
ents, and involve new types of
teachers - 46% of them -
adults rarely changed jobs.
teachers. We will create
send their kids to private
"Education Enterprise Zones.
schools. But my opponent and
Money alone is not the an-
There is no particular reason
his special interest supporters
swer - the United States al-
why schools have to end at
don't think you should have
ready spends more per pupil
3 p.m. so that students can sit
the same choice unless you are
than any other country but
in front of the TV for five
privileged enough to afford it.
Switzerland. And funding for
hours a day. We need to free
the Education Department has
school administrators and
One of the greatest educa-
increased 41% over my term.
teachers from rules, regula-
tional innovations in this
tions, and reports that have
country was the passage of the
The answer is a radical
become a poor substitute for
GI Bill after World War II. No
overhaul of our educational
student achievement; we can
one told my generation that a
system. If we want to change
do away with red tape once we
vet couldn't go to Notre Dame
our country, we've got to
institute a new testing system
or Brigham Young or Baylor or
change our schools. That's
that evaluates schools not on
Howard or Yeshiva.
what my America 2000 pro-
the basis of how many forms
gram is all about.
they complete, but of how
So I want a "GI Bill for
many minds they prepare.
Children" to help give lower
Our kids can't beat world
and middle income families
class competition if they can't
Finally, we must take
the means to select any school:
13
public, private, or religious. I
tablishment and special inter-
also want scholarships avail-
ests that want to resist this
able to be spent on after-
revolution. A new system of
families
school, Saturday and summer
education in this country is
academic programs.
already have this choice
probably the most important
ingredient over time in mak-
for their children. Many
For those who argue that
ing America the winning eco-
my approach will weaken the
nomic and export superpower
of the people that you
public school system, I would
in the post-Cold War era.
saw at the Democratic
remind them that the first GI
Bill was a tremendous boon for
National Convention
This must not only be my
public universities. Or listen
agenda, but yours, too. I will
have this choice for their
to Starr Parker, a small busi-
fight to give parents in
ness owner actively promoting
America the right to choose
children. Why shouldn't
choice in the Black communi-
the school their children will
you have this choice for
ty, who put it this way: "The
attend, but you need to help,
rich have choice now. When I
too. After you check out of
your children?"
was on welfare, there was no
work, check into your child's
way I could put my child in
homework. Talk to your child's
school It's time we stop con-
teacher. Join your local PTA.
demning the poor to a monop-
My approach - America 2000
oly education system."
- relies on parental, business,
and community involvement
We've already made
in creating new schools that
significant progress in starting
break the mold.
this radical reform agenda.
Some 44 states, and over 1700
I put the family at the cen-
communities, have already
ter of our society. Government
adopted my new national edu-
must try to help families -
cation strategy - America
not replace them. When it
2000. Indeed, this progress of-
comes to choices for our chil-
fers 8 good example of my
dren, parents really do know
commitment to pursue my
best. We should increase the
agenda whether or not
range of choices available to
Congress dawdles. If Congress
parents, and Government as-
balks, I will work with gover-
sistance should be targeted to
nors, state legislators, commu-
those families most in need.
nity officials, and the private
sector.
The other side may talk
about similar problems, but
I hope the new Congress
they are approaching them
will not remain an apple pol-
with a fundamentally different
isher for the educational es-
ideology. You can see the con-
14
trast not only in education,
business in Texas. I also call it
the competitive edge of
but in health care, or in the
common sense.
American business:
debate that took place over my
child care proposal, which we
You allow people to keep
strengthen small business;
fought for and managed to
most of what they produce,
enact into law. The opposition
and they will produce more
prefers uniformity to variety
than they can use, the rest
support civilian R&D
and choice. Because they place
being capital. You invite peo-
linked to a research exten-
a higher value on "leveling" so-
ple to risk failure by allowing
sion network; and
ciety, they will tend to rely on
them to keep the rewards of
Government bureaucracies to
success, and they will keep
reform our costly legal
offer "standard service." My
trying until they succeed.
system.
approach to education, child
care, health care, and other
A.
When capital is taxed
topies is to rely on a diverse
lightly, it becomes abundant.
Strengthen
Small Business
private sector to supply the
When it is taxed heavily, as it
service and to empower fami-
is now, it becomes scarce,
Small business is the
lies to make their own choices.
available only to those at the
backbone of a growing econo-
I don't want to pull everyone
top, who need it least of all.
my. Small businesses create
down to make them equal. I
That's not what I want. Even
two thirds of our new jobs;
want to give everyone the tools
Jesse Jackson put it this way:
they account for 39% of our
to climb as high as they can
"Subtract capital from capital-
GNP.
dream.
ism and all that's left is the
'ism'." If capital were abun-
I am seeking to aid small
dant, labor would become
businesses by reducing costly
VII.
scarcer. And the unemploy-
tax and regulatory burdens,
Sharpening
ment lines would shrink.
increasing access to credit,
Business'
That's what I want.
and removing barriers to com-
Competitive
petition
So I want to cut the capital
Edge:
gains tax and index it for
I have taken steps de-
Encouraging
inflation. I want to create en-
signed specifically to ease the
Entrepreneurial
terprise zones in inner city
tax burden on small business-
and rural areas. I want to
Capitalism
es. For example, the IRS has
make the R&D tax credit per-
proposed regulations to allow
manent. I want to provide an
Our ultimate success as an
small businesses to deposit
additional first-year deprecia-
economic superpower is depen-
payroll taxes on a monthly
tion allowance for purchases of
dent on encouraging the entre-
basis. And it has released a
property.
preneurial spirit of our private
ruling allowing over 16 million
businesses. I call it entrepre-
sole proprietors to deduct tax
Those are fundamentals.
neurial capitalism, and I saw
preparation fees as a business
In addition, there are three
it work when I started a small
expense rather than as a limit-
other ways we need to sharpen
ed itemized deduction.
15
I want to build on these
billion in general business
actions. For example, we are
loan guarantees through SBA
working on a Single Wage
in 1992 - an increase of more
"I
am seeking to aid
Reporting System that would
than 50% above 1991.
small businesses by
permit businesses to report
state and federal wage infor-
SBA's New England
reducing costly tax and
mation through a single enti-
Lending and Recovery Project
regulatory burdens,
ty, thereby consolidating tax
is a pilot effort that extends
reporting requirements and
credit to viable small firms
increasing access to
reducing the burden.
when access is limited because
banks are having difficulty. If
credit, and removing
In coming weeks I will talk
it works well and is needed,
barriers to
more about ways we can en-
I'll expand the project to other
courage small businesspeople
regions. We also have worked
competition."
and the jobs they create.
with bank regulators to base
real estate values on income
On the regulatory front, I
earning potential rather than
have extended for one year the
liquidation value. We have
freeze on paperwork and un-
taken steps to restructure the
necessary federal regulation
small business investment
that I imposed last winter; the
program, the only venture cap-
federal regulatory weight hits
ital program in the Govern-
small businesses particularly
ment. And we are developing
hard. I have also instructed
ways to offer special financing
federal agencies to look for
to exporting entrepreneurs.
ways to modify existing regu-
lations that impose a special
Through its procurement
economic burden on small
assistance program, SBA
business. For example, to in-
helped small businesses se-
crease access to capital for
cure federal contracts worth
small businesses, the SEC has
over $35 billion in FY 90 -
announced proposals to reduce
almost 20% of all prime con-
and in some cases eliminate
tracts let during that year.
the public disclosure require-
ment for small companies is-
To ensure that small busi-
suing stock.
nesses can help their commu-
nities overcome disasters, we
Since small businesses are
will be pressing forward with
particularly vulnerable when
approximately $1.7 billion in
credit is tight, we have to help
low-interest loans to small
them as our financial system
businesses in Florida,
is restructuring. That's why
Louisiana, California, and
we have authorized over $6
elsewhere.
16
Finally, we need to help
Americans invented VCR tech-
a High Performance
small business by removing
nology and the FAX machine,
Computing and Communi-
burdens to competition. My
we did not capitalize on their
cations Initiative that will
health care reforms would re-
explosive popularity. Third, we
enable the development of
duce costs for small businesses
need to rely increasingly on
a thousand-fold increase in
without costly Government
flexible, agile manufacturing,
computing capability by
mandates or higher taxes.
rather than old style mass pro-
1996 and a one hundred-
Enactment of my legislation to
duction. We should have the
fold increase in communi-
establish uniform federal law
capability to make a variety of
cations speed.
on product liability would re-
products quickly and economi-
lieve a major competitive
cally - a process character-
an initiative to improve
handicap that is keeping new
ized by short product cycles,
the manufacturing and
products from the market,
but also high quality output.
performance of materials
boosting insurance costs sky
- improvements that will
high, and killing jobs.
Taken together, these de-
enable advances in a wide
velopments emphasize decen-
range of other technolo-
B.
tralization - an approach ex-
Support Civilian R&D
gies
actly opposite to my oppo-
nent's "national industrial
To be the world's economic
policies" led by Government
an expanded program in
leader tomorrow, we clearly
bureaucrats. We need to get
biotechnology research
have to invest in R&D and
technology development, pro-
with applications in
new technologies today. Given
duction, and marketing closer
health, agriculture, and
the pace of change, we have to
to the consumer, not further
environmental protection.
both come up with new inven-
away. Moreover, my oppo-
tions and organize ourselves to
nent's call for a cut in support
the establishment of the
deploy new technology without
for university-based research
U.S. Advanced Battery
delay.
will hurt the development of
consortium, a jointly-fund-
cutting edge technology.
ed four-year effort to de-
The changes in industrial
velop an advanced battery
organization that I described
My agenda will increase
for an emissions-free
earlier have three major impli-
funding for basic research and
electric car.
cations for technology develop-
complement that work with a
ment. First, the more rapid
focus on applied research and
product development cycle
development. Despite cuts by
a significant increase in
places a premium on bringing
our aeronautics research
Congress, we have managed to
an idea quickly from the lab to
increase funding for basic re-
budget, underscoring the
the marketplace. Second, we
search by 26% since 1989 - to
importance we place on
need to put new technologies
the U.S. aeronautics in-
a record level. We are support-
to work in all applications in
ing applied R&D through a
dustry in an increasingly
order to reap the full competi-
series of new, high pay-off
competitive global market
tive and economic benefits
investments in critical
place.
from our R&D. While
technologies:
17
the establishment of seven
C.
regional manufacturing
Reform Our
"America has
technology centers for the
Legal System
distribution of modern
suffered a civil litigation
manufacturing tools, such
Our competitive edge will
as computer-aided design,
be dulled if businesses are con-
explosion. Over the past
numerically-controlled ma-
tinually handicapped by a
30 years, federal
chines, and robotics.
legal system that serves
lawyers but frightens people.
lawsuits have almost
These efforts to develop
Therefore, another component
tripled. Instead of being
and apply new technologies
of my agenda is a reform of the
need to be complemented by
American civil justice system.
fast, fair, and affordable,
the identification and removal
our civil justice system is
of barriers to the private sec-
America has suffered a
tor's ability to bring new prod-
civil litigation explosion. Over
slow, expensive, and
ucts and services to the mar-
the past 30 years, federal law-
putting us at a global
ket That's why my regulatory
suits have almost tripled.
reform efforts - including a
Instead of being fast, fair, and
disadvantage."
process that subjects regula-
affordable, our civil justice
tions to a competitiveness
system is slow, expensive, and
analysis while still protecting
putting us at a global disad-
health and safety, and a pro-
vantage.
posal to "sunset" regulations
- are critical to supporting
Long delays in dispute res-
our enhanced technology
olution waste valuable judicial
development.
resources, force early settle-
ment by those who cannot af-
Just take one example: my
ford to wait, discourage those
opponent has proposed a
who have meritorious suits,
major new Federal Govern-
and encourage frivolous suits
ment investment in the field of
by those who hope to leverage
national telecommunications
unjust settlements. High puni-
networks at the exact time
tive damage awards are
that our private sector is seek-
passed on to consumers
ing to develop such a network
through higher prices, job
on its own, but has been
cuts, higher insurance, and
stopped from doing so by fed-
fewer new products.
eral regulations.
According to a soon-to-be
released study by the National
Association of Manufacturers,
Americans spend up to $200
billion a year just on direct
18
costs to lawyers. That does not
nation's civil justice system
our competition. To be able to
even count lawyers on payrolls
through: alternatives to feder-
contribute and concentrate,
or the money spent on court
al civil trials such as alterna-
working men and women will
settlements.
tive dispute resolution; incen-
want to know that they can
tives for pre-litigation settle-
enjoy economic opportunity
Our legal system is killing
ment, including pre-complaint
and security. We can only
our international competitive-
notification; and a "loser pays"
achieve true security by devel-
ness. Other nations do not face
rule requiring the loser to pay
oping people's capability, not
high domestic litigation costs.
the winner's legal fees in suits
dependency. And we can best
Foreign companies only need
involving federal diversity
supply security through the
6% of the product liability in-
jurisdiction.
private sector, not Govern-
surance our firms must carry
ment bureaucracies.
because we do not have uni-
We also need to continue
form state standards for prod-
our work with the states to en-
It will be Government's
uct liability and punitive
courage fundamental change
role to expedite workers' ad-
damages.
at the state and local level.
justments in a fast-changing
marketplace, provide people
The litigation explosion af-
Lawyers, especially trial
the means to work and take
fects everyone. High liability
lawyers, are a powerful vested
care of their families, and arm
costs have closed playgrounds
interest in our society. They
people to face the future by
and pools, forcing kids on to
are well represented in
empowering them to make
the street with nothing to do.
Congress and high on the lists
their own choices. In particu-
Some companies are afraid to
of political contributors. My
lar, we can enable families to
offer products at home that
opponent knows them very
focus on building a future by
are available overseas because
well. But this is a problem too
alleviating their fears about
they fear the liability.
important to leave to the
one of the single biggest costs
lawyers and their friends in
and problems that can knock
My product liability re-
high places. We must sue each
them back: health care. And
form legislation confronts the
other less and care for each
we can help foster retirement
trial lawyers head on. I want
other more.
security through encouraging
to stop wide variation among
portable pension savings.
states' product liability rules;
stop important products from
VIII.
A.
being kept off the market; stop
Promoting
Job Training
excessive litigation costs with
Economic
more money going to lawyers
Given the rapidity of
than to injured consumers; cut
Security for
change in the international
excessive insurance rates; and
Working People
and domestic marketplace, we
end excessive consumer costs.
have to prepare people for the
The American businesses
prospect of changing jobs and
My "Access to Justice Act
of the 21st Century will need
learning new skills many
of 1992" is intended to restore
workers who will bring them
times throughout the course of
fairness and efficiency to the
to life and keep them ahead of
a productive life. Therefore,
19
we need a range of job training
of adding new skills and train-
and placement services - for
ing, and (3) a tripling of the re-
young people, factory workers,
sources currently devoted to
"Work means more
white collar employees, and
training and worker adjust-
than income to
particularly during this peri-
ment, an allocation of $10 bil-
od, defense industry workers.
lion over five years.
Americans. It is also
fundamental to
That's why one important
This proposal builds on my
portion of my recently-an-
January plan to streamline
people's self-esteem,
nounced workforce adjustment
the federal job training system
initiative is designed to shift
through "one-stop shopping" in
their self-confidence,
the Government away from
every community. Experience
and the respect of
the old narrowly defined, ex-
has demonstrated that the
pensive, and less effective
others. These are
most effective training and
trade adjustment assistance
placement services are those
attitudes, values, that
that paid people off without
closely developed with local
giving them real help to get
employers through private in-
want to encourage. /
back the work.
dustry councils. That way the
want all Americans to
training is designed to develop
Work means more than in-
skills that employers know
be builders - for their
come to Americans. It is also
they will need.
families, their
fundamental to people's self-
esteem, their self-confidence,
My expanded job training
communities, their
and the respect of others.
efforts will also be specially
These are attitudes, values,
country."
designed to help those who
that I want to encourage. I
may need to change jobs or
want all Americans to be
careers as a result of NAFTA
builders - for their families,
or other trade agreements
their communities, their coun-
and the downsizing of our de-
try. To encourage the work
fense-related industries. But
ethic, we need to make every
we will ensure that we offer
effort to match people with the
training and placement to all
jobs created by our entrepre-
workers.
neurial capitalism.
These dislocated workers
The three key features of
would be eligible to receive
my job training proposal are:
three types of assistance: (1)
(1) universal coverage, so all
transition-assistance that in-
dislocated workers will have
cludes skills assessment, coun-
access to basic transition as-
seling, job-search assistance,
sistance and training support;
and job referral; (2) training
(2) skill grant vouchers of up
assistance in the form of skill
to $3000 to help meet the costs
grants; and (3) transition
21
My program also includes:
Taken together, my pro-
gram would cut health care
provisions that encourage
"I
costs by $394 billion over five
believe we can
small businesses to develop.
years through preventive care,
provide access to
less costly health care in-
malpractice reform, reducing
surance networks for their
defensive medicine, encourag-
affordable health care
employees by combining re-
ing enrollment in cost-effective
for all Americans, while
sources to achieve broader
health plans, arming con-
risk sharing, economies of
sumers with information
preserving choice for
scale, and purchasing
about cost and quality, and
patients and their
power;
eliminating administrative
waste and unnecessary paper-
families in selecting
job lock" protection for em-
work.
ployees and their families
doctors, hospitals,
so that they will not lose
I believe we can provide
health care programs,
coverage if and when a per-
access to affordable health
son changes jobs;
care for all Americans, while
and employment"
preserving choice for patients
guaranteed insurability so
and their families in selecting
that people with "preexist-
doctors, hospitals, health care
ing" illnesses cannot be de-
programs, and employment.
nied a job or health cover-
My approach, in contrast with
age on the job;
my opposition, relies on the
private sector to deliver health
care services. But I would
100% tax deductibility of
make the market work for us
health care premiums paid
by the self-employed, as
by enhancing competition,
compared to the present
which will cut costs. My mal-
25% deductibility;
practice reforms would cut
costs further by removing the
fear of lawsuits that leads to
malpractice reforms that
wasteful procedures.
will reduce the number of
unnecessary procedures
I firmly believe that a
performed on patients and
move to national health insur-
thereby reduce the cost of
ance, as some of my opponents
medical care; and
want, would be a major, irre-
trievable mistake. That course
reforms to encourage wide-
would turn over the health
spread use of electronic
care sector - a full 13% of our
billing to save an estimated
economy - to the Govern-
$11 billion a year in paper
ment. The result would be
costs.
more bureaucracy, rationed
22
care, inefficiency, and, in the
sign a law this summer that
better life for themselves and
end, even higher costs.
incorporated my portability
their children. It's this spirit,
proposal. The new law en-
the commitment to the
My opponent's "play or
hances retirement security by
American Dream, that has
pay" approach winds up in the
permitting workers to transfer
made our country and our so-
same place as nationalized,
accrued pension benefits di-
ciety the most dynamic in the
buresncratic health insurance
rectly to an IRA or to their
world.
- but through a different
new employer's pension plan.
route. And it is likely to kill a
If we are going to use that
lot of jobs along the way, espe-
Despite this improvement,
energy to drive us forward into
cially in small businesses.
I believe we must continue to
the 21st Century, we will need
Increasing the costs of labor -
look for ways to make it easier
to tap the aspirations of each
the "play" in his approach -
for workers who change jobs to
and every one of our citizens.
will lead businesses to hire
take pensions with them. We
No one should be left behind
fewer workers. Offering the al-
need to eliminate incentives to
for want of opportunity.
ternative of Government-
"cash out" benefits and in-
sponsored health care paid for
crease incentives to save for
Many of the programs that
with new taxes on payrolls -
the future.
I have discussed above -
the "pay" - will dump the
health care for all Americans,
problem in the lap of a
Job training, afford-
child care, job training, pen-
Government bureaucracy with
able health care, retirement
sion portability, a new compet-
the costs paid for by business-
security - when combined
itive school system based on
es and workers.
with a new system of educa-
community involvement and
tion and entrepreneurial; com-
choice for all American fami-
C
petitive business, we can offer
lies - support my plan to em-
Pension Portability
working men and women real
power all Americans to make
their own choices and better
economic security in the 21st
I have also been concerned
Century.
their lives. But I believe we
about the ability of workers to
need to do more for certain eit-
preserve their retirement pen-
izens who have fallen too far
sions as they change jobs. This
IX.
behind.
is a growing need because of
the increased likelihood that
Leaving No
My philosophy for en-
most workers will have more
One Behind:
abling all Americans to share
than one employer over the
Economic
the American Dream is sim-
course of their working years.
Opportunity for
ple: it's based on property and
work. Our urban and welfare
I proposed an initiative
Every American
programs must be designed to
last year to increase pension
enable people to break the
portability, expand pension
For over 200 years, the
cycle of poverty, get back on
coverage, and simplify the law
most exceptional aspect of
their feet, get back to work,
governing pension plans. And
American society has been the
and take responsibility for
belief, the hope, that this is a
I am pleased that I was able to
their own choices and their
land where people can make a
own lives.
24
This property and work-
X.
what our nation produced.
based approach need not be
That compares with 17.6% in
"Rightsizing"
more expensive than the tradi-
1965, 19.9% in 1970, 22.0% in
tional welfare bureaucracy.
Government
1975, and 22.3% in 1980. So
For example, over the past 12
not only has Government
years, federal spending for low
My blueprint envisages an
grown as the economy has
income assistance doubled
important Government role to
grown, but Government is tak-
even after inflation - from
make a secure and strong
ing a bigger share. The
$9.1 billion in 1980 to $18.3
America. But it is also impor-
American people are not taxed
billion this year (both in 1992
tant that Government not
too little. The American
dollars). This year, HUD is
siphon off more private re-
Government spends too much.
providing housing assistance
sources than are absolutely
to 4.6 million low-income fami-
necessary to perform the func-
In my acceptance speech I
lies, up from 3.1 million in
tions that will help us win the
noted some of the efforts I will
1980. I have tried to rechannel
economic competition. Because
make to hold down spending. I
some of this funding to vouch-
an overweight Government -
have proposed capping the
ers because they are more
serving itself seconds rather
growth of mandatory spend-
cost effective than con-
than serving the people first -
ing, other than social security.
structing new public housing
will weigh us down in the race
That would still permit spend-
units. Furthermore, families
of a new era.
ing at present levels plus an
wouldn't have to wait five
adjustment for inflation and
years for the units to be built,
Much of my agenda can be
population growth. Yet this
and the vouchers give families
accomplished simply by redi-
cap would save $294 billion
more choice.
recting current funding away
over five years.
from bureaucracies and to-
For too long, Congress has
wards people. My agenda em-
To start to implement this
stubbornly refused to discard
powers people with the means
cap, I have proposed over $72
failed programs that perpetu-
to work, own property, build
billion in specific spending
ate welfare dependency. No
capital, raise families, and be
cuts for "mandatory" programs
doubt, many of these programs
effective contributors within
(FY93-97). If you add these
were well intentioned. But
our private market economy.
proposed cuts to others I have
now we know better. Give us a
Some of my ideas - legal and
previously called for but which
chance to try a different ap-
health care reforms, for
Congress has not yet enacted,
preach that will empower peo-
example - should even help
my specific cuts would total
ple to help themselves, to
us save money.
about $132 billion over five
build some capital for their
years. I have also proposed
families, to make choices that
Contrary to the assertions
the outright elimination of
develop self-respect and disci-
of some politicians and special
246 specific discretionary
pline. That's the real way to
interest groups, spending as a
programs.
offer economic opportunity for
percentage of the nation's
every American, to leave no
GDP has been going up, not
By way of comparison, my
one behind.
down. In 1991, the Federal
opponent has specifically pro-
Government spent 23.5% of
posed less than $5 billion in
25
cuts in mandatory programs.
I also believe taxpayers
And he has singled out only
should have the right to direct
one program for elimination -
10% of their tax payments to
"Government should
the honeybee subsidy pro-
reduce debt and spending
be subject to the
gram, which his running mate
through a "check-off" on their
voted four times to retain.
tax forms. If all taxpayers took
discipline of a balanced
the full 10%, the cut would be
budget amendment
Furthermore, I proposed
about $50 billion. That's only
freezing all other spending,
3% of the Federal budget of
State governments
and I will enforce this freeze
about $1.5 trillion. Since feder-
by vetoing any bill Congress
operate that way.
al spending has been growing
sends me that spends more
at a rate of about 8% per year,
Businesses operate that
than I asked for in my budget.
even this proposed cut would
still enable spending to grow;
way. Families operate
I've asked Congress for the
it would just grow more
that way. And given the
line item veto, a disciplinary
slowly.
breakdown of
tool used effectively by the
governors of 43 states. This
Some editorialists dismiss
Congressional discipline,
veto authority is important not
my checkoff proposal, but the
only to help cut, but to in-
we need an
American people seem to like
crease a President's leverage
it, and I think I know why. My
amendment to ensure
with a Congress that seeks to
proposal traces its roots to an
tax more and spend more.
American tradition. At the
that the Federal
turn of this century, many
Government operates
Government should be
people were concerned that
subject to the discipline of a
the Government establish-
that way, too."
balanced budget amendment.
ment was slipping away from
State governments operate
the people it was supposed to
that way. Businesses operate
serve. This movement led to
that way. Families operate
such venerable "gimmicks" as
that way. And given the
referenda, the right of recall,
breakdown of Congressional
and the direct election of U.S.
discipline, we need an amend-
Senators. The idea of term
ment to ensure that the
limits for Senators and
Federal Government operates
Congressmen, which I fully
that way, too. If we had had
support, is another reform of
such an amendment years ago,
this type. At the time each was
we wouldn't be paying almost
proposed, the conventional
$200 billion dollars a year now
thinkers chuckled at the
on interest for the debt left us
changes. The same is true
by earlier Congresses.
today. Given the complete
breakdown in spending disci-
pline in Congress, it's time
27
will provide some of these
members - all 150 or more -
funds, and I don't want them
before they are besieged by the
Between the
wasted in a torrent of new
special interests and perma-
spending programs designed
nent staffs.
election and the
by a horde of special interests.
I also believe we need to
convening of a new
I honestly believe that this
take another step to ensure
Congress, / will lay out
is the only way to get the size
that the new Congress does
and spending of Government
not become like the old one.
an implementation plan
under control. I know that se-
The root of the present prob-
for my agenda. / intend
rious-minded people believe
lem is political contributions
we need to increase revenues
from organized special inter-
to be ready to present
to close the deficit. But it won't
ests through political action
the new Congress a
work. I have seen too many
committees, or PACS. In the
times that efforts to close the
run up to the 1980 elections,
first-year plan to carry
deficit by increasing taxes
PACs raised and contributed
out the legislative
have only turned out to give
$55 million to political candi-
Congress a license to spend
dates. In the same time period
proposals described in
more money. There's a reason
before the '90 elections, PACs
for this. Spending is power for
spent about $160 million. The
this agenda."
Congressmen. That's how they
other party doesn't want to do
show influence, and placate
anything about it, because
their friends, the interest
they are the biggest recipients.
groups. If you give Congress-
I want to put them to the test.
men more tax money, they will
I want a new Congress to stay
spend it.
clean. So an important part of
my new legislative agenda will
be a simple bill to abolish
XI.
PACs subsidized by coΓpoΓa-
A Strategy for
tions, unions, and trade
Implementation
associations.
This year is an important
I am committed to making
turning point for the United
my program work with Con-
States. We are entering a new
gress. Between the election
era, and for the first time in
and the convening of a new
many years, it appears that
Congress, I will lay out an im-
Congress will have 150 new
plementation plan for my
faces for the President to work
agenda. I intend to be ready to
with. That's why I'm asking
present the new Congress a
for a mandate for my program.
first-year plan to carry out the
That's why I have promised
legislative proposals described
that I will meet with all new
in this agenda:
28
A radical overhaul of
structure, ensure functions
implement my educational re-
American education to em-
fit new needs, and cut
forms while Congress has
phasize excellence, stan-
salaries at higher levels
stalled. We can get a great
dards, competition, entre-
deal done at the state and
preneurial schools, and a
local levels.
Reform of our legal system
"G.I. Bill for Kids" that
will give parents a choice
I will work with governors,
of schools
A package to clear away
state legislatures, local gov-
crime, build business, and
ernments, and the private sec-
put people to work in our
My job training programs
tor to pursue my agenda.
inner cities
While I want a Congress that
can help me do the job, I'm
My health care reforms
An expansion of Civilian
committed to getting the job
R&D linked to new appli-
done one way or the other.
A package to cut spending,
cations
including a cap on the
growth of mandatory
Ban on PAC contributions
spending, a taxpayers'
"checkoff" to reduce the
debt, a line-item veto, and
Limits on Congressional
a balanced budget amend-
terms
ment
Now I know I may not be
able to get everything I want
Tax cuts paid for through
in the exact way I want it. But
spending reductions and
your support for a mandate to
growth, including reduc-
get it done would give me mo-
tions to spur entrepre-
mentum. I intend to fight for
neurial capitalism and
this agenda, fight as hard as I
small business
can to get as much as I can,
and then come back again to
NAFTA
get more.
New trade negotiating au-
If Congress hesitates on
thority so we can conclude
some fronts, I intend to keep
new Free Trade Agree-
moving forward. You have
ments across the Atlantic,
seen that we can implement
the Pacific, and in our own
back-to-work welfare reform
hemisphere
by granting waivers that en-
able the states to do the job
more effectively. Similarly, 44
A Government reorganiza-
states and more than 1700
tion plan to streamline the
communities have started to
29
This is my Agenda for
through the private sector. I
American Renewal. With the
believe people should sue each
"With
the end of the
end of the long Cold War, we
other less and care for each
can target peace, prosperity,
other more. I want Govern-
long Cold War, we can
and promise at home. The
ment to spend less and tax
American people want that.
less. I will fight without hesi-
target peace, prosperity,
The American people deserve
tation for a free and fair flow
and promise at home.
that
of trade, capital, and ideas
around the world. I believe
The American people
At the same time, Ameri-
America should compete, not
want that The
cans recognize that the great
retreat.
events of recent years have
American people
shaken the world, and it will
I know times have been
deserve that"
never be the same. If we are to
difficult for too many
succeed as a nation and as a
Americans. I have sought to
people, if we are to hold true to
explain the causes of these
all that has made America the
,problems and what I will do
EARTH.
last, best hope of man on
about them. Of course you will
earth, then our renewal at
have change. The question is
home must at the same time
what kind of change. You face
enable us to make the 21st
a serious choice. And I ask,
Century another American
when you step into that voting
Century.
booth, please consider careful-
ly which candidate's agenda
My Agenda draws together
for change fits best with your
our people and our Govern-
beliefs, America's experience,
ment to take on this challenge.
and our hopes for lasting
We will create a $10 trillion
peace and prosperity.
economy. We will renew
America. We will win the
peace.
My approach to this chal-
lenge is fundamentally differ-
ent from my opponent's. I
want to stimulate entrepre-
neurial capitalism. I want to
help people by enabling them
to make their own decisions
about health, education, job
training, and child care from a
variety of competing alterna-
tives. I want to supply services
BUSH
***
QUAYLE
92
1030 15th Street, NW
Washington, DC 20005
Paid for by Bush-Quayle '92 General Committee, Inc.
THE WHITE HOUSE
Office of the Press Secretary
(Detroit, Michigan)
September 10, 1992
For Immediate Release
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,
and thank you for that kind introduction. Greetings to Chick
sir, 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,
business. And I'm releasing today an agenda for the American
serious 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
MORE
- 3 -
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 18 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
- 4 -
children on to higher education -- more than any other country -- and
well above Germany's 32 percent and Japan's 30 percent. And with $
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 Dew 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.
- 5 -
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 so 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
- 6 -
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 8 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. : 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 die -- 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 will 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.
- 7 -
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 3394 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 SC 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
- 8 -
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 zave
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 $75,000 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 Dew 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 $130 billion in specific spending cuts that I
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. I
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.
peace, have shaken the world. with the close of the cold war recent achieve years
The American people know that the events of
that. The prosperity and promise at home. The American people we can want
American people deserve that.
stimulate empower entrepreneurial capitalism, not punish it; I I want
And I want America to seize this moment. to
bureaucracies. people to make their own choices, not yoke them want to
of trade and And I will fight without hesitation for regulates less,
and taxes less. I want a government that spends less, to new
never retreat capital -- and ideas around the world -- because a Americans free flow
we always compete. (Applause.)
we to will meet renew this challenge. We will create a $10-trillion government And
My agenda draws together our people and our
America. And we will win the peace. (Applause.) economy.
destiny; how never be the same. America will change -- that's matter our
many age -- Americans. will The world that we knew as children -- no for your
I know that times have been very, very difficult
it will change will soon be decided.
principles, consider carefully whose agenda for change best fits you face,
I ask, as you consider the choice that to
and prosperity. our national experience, and our hopes for America's lasting peace
great country. Thank you. (Applause.)
Thank you for your attention. And may God bless our
END
1:40 P.M. EDT