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The original documents are located in Box 54, folder "President - State of the Union
Address, 1976 (2)" of the Philip Buchen Files at the Gerald R. Ford Presidential Library.
Copyright Notice
The copyright law of the United States (Title 17, United States Code) governs the making of
photocopies or other reproductions of copyrighted material. Gerald R. Ford donated to the United
States of America his copyrights in all of his unpublished writings in National Archives collections.
Works prepared by U.S. Government employees as part of their official duties are in the public
domain. The copyrights to materials written by other individuals or organizations are presumed to
remain with them. If you think any of the information displayed in the PDF is subject to a valid
copyright claim, please contact the Gerald R. Ford Presidential Library.
Digitized from Box 54 of the Philip Buchen Files at the Gerald R. Ford Presidential Library
THE WHITE HOUSE
WASHINGTON
December 15, 1975
12:45 p.m.
MEMORANDUM FOR:
DICK CHENEY
ROBERT T. HARTMANN
BILL SEIDMAN
FRANK ZARB
JAMES LYNN
PAUL O'NEILL
BRENT SCOWCROFT
ALAN GREENSPAN
PAUL MacAVOY
JACK MARSH
MAX FRIEDERSDORF
PHIL BUCHEN
ED SCHMULTS
JERRY JONES
ART QUERN
FROM:
JIM CANNON
SUBJECT:
State of the Union Meeting on
Revitalizing the Federal System
The attached paper will serve as a beginning point
for discussion this afternoon on a proposed section of
the State of the Union Message dealing with Revitalizing
the Federal System.
Attachment
FORD
LIBRAR
V. The Fifth Challenge: Revitalizing our Federal
System.
A. We recommend that you reaffirm your faith in
the unique values of the American Federal system
of shared sovereignty and responsibility -- its
capacity:
1. To foster diversity within unity;
2. To encourage imagination, innovation and
creativity in both the public and private
sectors;
3. To achieve balance by the division of
authority between national and state governments
and the separation of power among the executive,
the legislative and the judicial branches;
4. And its pluralism -- the capacity to sustain
many differing beliefs which strengthen the
total fabric of American society.
B. We recommend that you explain that historic
forces have distorted the relationships between
the Federal partners and thus undermined the
strength of the system:
1. The uncoordinated proliferation of categorical
grants, with resultant duplication, conflict,
inefficiency, waste and weakening of initiative
and responsibility at the state and local levels;
2. Confusion of responsibility among Federal,
state and local governments, hence declining
public confidence in all government.
3. Aggravation of state and local fiscal problems
by the matching requirements of grants.
4. Effective exclusion of state governments
from prior formulation of Federal programs
which these governments must then administer.
- 2 -
C. We recommend that you propose to Congress these
actions to revitalize the Federal system:
1. To strengthen the financial capacities of
government closest to the people:
-- Renew General Revenue Sharing --- undergirding
the program with a permanent trust fund.
2. To eliminate duplication and waste and to
strengthen initiative and responsibility of
governments closest to the people:
-- Consolidate Federal aid programs into
these four areas, to be administered
primarily by the states:
: Health
: Education
: Social Services
: Community Development
3. To strengthen and restore the authority of
state governments and to decentralize the
Federal regulatory bureaucracy:
-- Provide for state administration of Federal
regulatory programs, based on Federal
approval of state plans.
4. To rationalize the Federal system:
--- Make a clear, simple allocation of roles
and responsibilities to each level of
government.
5. To make revitalization of the Federal system
a high priority of the Administration and to
involve state governments in policy planning:
-- Propose creation of an Executive Office of
Intergovernmental Coordination in the
White House.
THE WHITE HOUSE
WASHINGTON
Those are the
S tate of the
Union meetings
Monday 12/15/75
State of the Union
Meetings
9:00
Mr. Cannon's office advises of the following
meetings on the State of the Union:
Monday 12/15
11 a. m.
Situation Room mr. Schmults
Wednesday 12/17
11 a. m.
Situation Room
5 P. m.
Situation Room
Thursday 12/18
11 a. m.
Situation Room
5 p.m. P.
Roosevelt Room
Friday 12/19
11 a. m.
Situation Room
5 p.m.
Roosevelt Room
(Meetings will last approximately an hour)
CC: Mr. Schmults
AMOUNT GERALD = FORD
THE WHITE HOUSE
WASHINGTON
December 15, 1975
MEMORANDUM FOR:
DICK CHENEY
ROBERT T. HARTMANN
BILL SEIDMAN
FRANK ZARB
JAMES LYNN
PAUL O'NEILL
BRENT SCOWCROFT
ALAN GREENSPAN
PAUL MacAVOY
JACK MARSH
MAX FRIEDERSDORF
PHIL BUCHEN
ED SCHMULTS
ART QUERN
FROM:
JIM CANNON
SUBJECT:
State of the Union Discussions
The purpose of these meetings is to provide for brief
discussion of the elements of the State of the Union
and to enable submission in writing of comments and
suggestions on these elements. This is aimed at:
1. Ensuring a prompt compilation of possible themes
and principles.
2. Identifying various specific programmatic decisions
which have been, are being, or need to be made.
Where decisions have been made, the purpose is
to determine how best to treat them in the State
of the Union.
Where decisions are in the process of being
presented to the President, the purpose is to
accelerate the process.
Where decisions that need to be made are identified,
the purpose is to determine the most expeditious
means of bringing the issue to a decision.
2
3. The documents produced on each "challenge" will
be compiled and given to the President.
-
Challenges I and V by the 19th.
- Challenges IV and VI by the 20th.
Challenges II and III by the 21st.
Revised 12/15/75
3
Schedule for Meetings
MONDAY, December 15
11 a.m.
Brief group on process
Sit Rm.
lay out themes and Six Basic Challenges
TUESDAY, December 16
11 a.m.
I. : Continuing America's Growth While Ensuring
Cannon's
Fiscal Responsibility
Office
(Comments and papers due 12/18/75)
5 p.m.
V. Revitalizing Our Federal System
Cannon's
(Comments and papers due 12/18/75)
Office
WEDNESDAY, December 17
11 a.m.
IV. Ensuring Responsible Social Policies
Sit Rm.
(Comments and papers due 12/19/75)
5 p.m.
VI. International Peace and Security (Scowcroft)
Sit Rm.
(Comments and papers due 12/19/75)
THURSDAY, December 18
11 a.m.
III. Increasing Employment and Productivity
Sit Rm.
(Comments and papers due 12/20/75)
5 p.m.
II. Achieving Energy Independence
Sit Rm.
(Comments and papers due 12/20/75)
12/15/75
4
Deadline for Decision Papers to the President
FRIDAY, December 19
2 p.m.
Completion and Submission of Paper to
President on Challenges I and V.
SATURDAY, December 20
2 p.m.
Completion and Submission of Paper to
President on Challenges IV and VI.
SUNDAY, December 21
2 p.m.
Completion and Submission of Paper to
President on Challenges III and II.
WEDNESDAY, December 31
6 p.m.
All issues resolved and all papers to
Hartmann.
THE WHITE HOUSE
WASHINGTON
December 29, 1975
MEMORANDUM FOR:
DAVE GERGEN
FROM:
PHIL BUCHEN
SUBJECT:
Your "General Themes"
Paper
In general, I believe you have selected your questions
well and have given effective answers.
However, I do have misgivings about your answer for
the President's "Greatest Disappointment" in 1975.
Even if the intrusion by the Congress into the conduct
of foreign policy does represent a disappointment, I
doubt that the refusal of Congress to provide emergency
aid to South Vietnam in the closing days of the war
actually enlarged the tragedy that occurred there. I
believe the facts are that the downfall of the South
Vietnamese Government came so fast that even a
favorable vote on emergency aid would not have altered
events very much, if any. (As I recall, at the time
of the total victory by the North Vietnamese, the
President deliberately did not put the blame on
Congress.) Also, even though it is questionable for
Congress to have voted an embargo on aid to Turkey
and a cutoff on aid to Angola, I doubt a good case
can be made for arguing that Congress exceeded its
proper role in taking these actions.
My opinion is that greater disappointments for the
President came from these circumstances:
1. The hardships suffered by many people
as a result of an economic recession
that defied any "quick fix" because of
the overriding risk of inflation that
worked against using conventional
devices to restimulate the economy;
- 2 -
2. Failure of Congress to be prompt and
effective in dealing with the overall
energy problem, the need for tax
reform, and the need to support job
formulation through incentives to
capital formulation; and
3. Failure of Congress to work constructively
with the Executive branch toward the
objective of restoring the trust of the
people in their government.
In the section on "Goals for our Third Century", I
would change "fruits of happiness and prosperity"
to "opportunities for the pursuit of happiness. "
THE WHITE HOUSE
WASHINGTON
January 16, 1976
MEMORANDUM F OR:
ED SCHMULTS
FROM:
KEN LAZARUS
fe
SUBJECT:
State of the Union Message
I had another thought on the crime control portion of the State
of the Union -- -
In the President's Crime Message, he stressed a program of
compensation for innocent victims of Federal crime. This
positive concept can be restated in the State of the Union as
follows:
"I again urge the Congress to assure compensation
for the 'forgotten man' in the criminal justice
system -- the victim of crime. Traditional forms
of sentences by themselves encourage little
atonement. Requiring the perpetrators of
federal crimes to provide the funds necessary
to compensate their victims serves not only to
ease the plight of the victims but to emphasize
to offenders the human dimensions of their crimes."
R. FORD LIBRARY
THE WHITE HOUSE
WASHINGTON
January 16, 1976
MEMORANDUM FOR:
ED SCHMULTS
FROM:
KEN LAZARUS
P
SUBJECT:
State of the Union Message
In his Crime Message last year the President endorsed 11
the
type of comprehensive criminal code reform incorporated in
S. 1. " This bill to revise the whole of Title 18 United States
Code was recently reported from the Senate Subcommittee on
Criminal Laws and Procedures to the full Committee on the
Judiciary. Senator Hruska and members of Senator McClellan's
staff have indicated to me that they are prepared to move the
bill to the Senate floor within approximately one month after the
opening of the Second Session. Senator Hruska has indicated to me
that he would like to have some statement along the lines of that
contained in the Crime Message incorporated in the State of the
Union. Additionally, in order to light a fire under Senator
McClellan, who is easily distracted by his Appropriations
Committee responsibilities, he would like some reference made
to the hope that code reform will receive final Senate action
early in the session.
I believe this matter is important enough to warrant the inclusion
in the State of the Union of the attached paragraph.
Attachment
is
FORD
ADDRESS
In my Crime Message delivered to the Congress in the
First Session of the 94th Congress, I endorsed the type of
comprehensive criminal code reform embraced by S. 1, which
was recently reported to the full Senate Committee on the
Judiciary. In order to refine the state of our substantive
Federal criminal law and to fashion a responsible model for
state code reform, I am hopeful that the Senate will act early
in the current session to finalize action on this legislation and
that the House will promptly entertain consideration of the
Senate's work product.
FORD
GERALD
THE WHITE HOUSE
WASHINGTON
January 16, 1976
MEMORANDUM FOR:
ED SCHMULTS
FROM:
KEN LAZARUS
D
SUBJECT:
State of the Union Message
A few thoughts on the 1/15/76 draft of the State of the Union
Message:
(1) On page 3 "summer" should be "summertime" soldiers.
(2) On page 5 the next to the last paragraph contains some
noticeable gaps in logic.
(3) On page 12 following the first paragraph, it might be
appropriate to include the President's decision on the Alaskan
gas initiative.
(4) On page 13 references to the change in the funddistribution
formula should be eliminated. The statement lends nothing to
the message and will be unsettling to a number of people.
(5) Attached is a "quick and dirty" rewrite of pages 22-25,
the crime control section of the message.
2
Protecting the life and property of the citizen at home
is primarily the job of local and state law enforcement authorities.
Historically, Americans have found the very thought of
a Federal force with general police powers to be repugnant and
intolerable, and so do I. Yet there are proper ways in which we
can help to ensure domestic tranquility as the Constitution charges
us.
My conclusions on how to reduce violent crime were given
to the Congress last June with emphasis on protecting the victims
of crime.
The fabric of our criminal law must be woven to ensure
the goals of deterrence, punishment and rehabilitation. However,
we must also recognize the principle of incapacitation in our law
enforcement process -- one sure way to keep a criminal from
committing more crimes is to lock him up so he cannot harm law
abiding citizens.
The realistic way to cut down violent crimes committed
with guns is not to confiscate guns but to toughen the penalties
for crimes in which guns are used, make it harder to obtain cheap
guns which have no purpose other than the taking of human life, and
to concentrate gun control enforcement in high crime areas.
2
3
I have urged the passage of mandatory minimum sentences
for those convicted of crimes involving the use of a handgun. I
have also proposed that we outlaw the manufacture, sale or
transfer of so-called "Saturday Night Specials". Lastly, I have
asked Congress for 500 additional Federal agents in 11 metropolitan
high crime areas to help local authorities stop criminals from
selling and using handguns.
Although violent crime is the principal focus of most
almost
Americans, we must recognize that the seeds of all street crime
are hard drugs. Drugs are not only a major domestic problem
but an international issue. Here the Federal responsibility is
plain.
I have directed all departments of the Federal Government
to clearly define the responsibilities of interested law enforcement
agencies and accelerate our efforts against the big drug traffickers
and dealers who sell hard drugs and attract young people to them.
As President I have talked personally with the leaders of
&
Maxico, Columbia and Turkey to demand greater efforts by their
governments to control effectively the production of those opiates
which are the source of hard drugs.
I also recommended months ago that Congress enact
stiffer and mandatory prison sentences for drug traffickers.
I
call upon Congress again to enact this legislation promptly.
27
To make justice more swift and certain for those arrested
for crimes, I am proposing an increase this year in U. S.
Attorneys prosecuting Federal crimes and reinforcement of the
number of U. S. marshals. However, our courts also cry
out for additional manpower. Four years ago the Judicial
Conference of the United States recommended the creation of 51
new judgeships around the country to meet the needs of Federal
law enforcement. The Chief Justice of the United States has also
pressed this request but to date the Congress has failed to act on
the recommendation. Our courts require strong bipartisan
support in this request for justice delayed is often justice denied.
I would also like to stress my concern that incarceration
not result in a deprivation of human dignity. Prisons must meet
essential human needs. Money is in my new budget to build four
new Federal facilities, open and operate three that are almost ready
and rehabilitate others.
As I noted earlier in my remarks, the bedrock of law
enforcement is to be found at the State and local level. However,
the Federal Government can provide financial and technical
also
assistance to their efforts. I will/propose in the new budget that
Congress authorize $6. 7 billion over the next five years to assist
State and local governments to protect the safety and property of
all citizens.
2
It is unrealistic and dishonest to hold out the hope that
the Federal Government can move in and clean up crime in
every neighborhood. But I do pledge to crack down on every
illegality that falls within the President's duty to faithfully
executive the law.
is
FORD
LISE
THE WHITE HOUSE
WASHINGTON
January 17, 1976
MEMORANDUM FOR:
BOB HARTMANN
FROM:
PHIL BUCHEN
P.
Attached is a document handed to me last evening by the
Attorney General. It proposes points for inclusion in the
crime portion of the President's State of the Union message.
I think the Attorney General realized that the speech is too
faralong to permit any significant changes, but you may want
to check what is already in the speech on this subject against
the Attorney General's document to see if any modifications
are desirable.
FORD
DRAFT CRIME PORTION OF THE PRESIDENT'S STATE OF THE UNION MESSAGE
The continuously rising crime rate is a matter of great
concern to all Americans. It is a challenge which must and
shall be faced. This Administration has undertaken new
initiatives in meeting the problems of white collar crime and
crime committed by career criminals. Yet, the most feared form
of crime -- random street violence -- is largely beyond the
direct control of the federal government. In this area we can
take some direct action, however, by improving applicable federal
laws, and we can provide leadership and assistance for the
state and local governments. I propose a combined approach to
the problem.
First, I again urge the Congress to assure compensation
for the "forgotten man" in the criminal justice system -- the
victim of crime. Traditional forms of sentences by themselves
encourage little atonement. Requiring the perpetrators of
federal crimes to provide the funds necessary to compensate
their victims serves not only to ease the plight of the victims
but to emphasize to offenders the human dimensions of their
crimes.
Second, I urge Congressional extention of the Law Enforce-
ment Assistance Administration in order to assure the careful
research and planning -- and the funding -- that is necessary to
present a united front against crime.
R.
GERALD
FORD
LIBRARY
1/5/76
RLG
- 2 -
Third, I urge prompt passage by both houses of Congress
of the Criminal Justice Reform Act. Only a handful of issues
in that effort to codify the federal criminal law have become
subjects of controversy. There is a clear consensus that the
overwhelming preponderance of the bill represents an enlightened
and progressive effort to simplify, clarify, and improve the
federal criminal law. I trust that the members of Congress
can continue the bipartisan effort which has typified the
codification process for the past ten years and join together
to settle the few areas of difference. Such an effort is greatly
needed. The nation can not hope to meet the problem of crime
without a modern federal criminal code.
Fourth, and in relation to the new federal criminal code,
our sentencing and correctional systems are in serious need of
reexamination. I have submitted previously a proposal for
mandatory sentences for certain offenders. I am pleased to
note that numerous members of Congress of both political parties
have demonstrated their agreement with the necessity for
certainty in sentencing. I urge the Congress to act speedily
in implementing such a proposal.
to GREAT
- 3 -
Finally, I urge the Congress to pass the legislation
which this Administration has proposed to keep convicted
felons from freely purchasing handguns and to remove from
the market the handguns most used in crime - the "Saturday
Night Specials." The legislation is carefully drafted to
protect the rights of all legitimate handgums owners. Its
focus is upon the criminal and upon the criminals' gun. It
will not eliminate gun crimes, but it can help to reduce
them. This is a goal that can be measured in human lives.
It must be pursued.
GERALD R. FORD
EIGHTH DRAFT
1/ 18/76
STATE OF THE UNION MESSAGE
OF
PRESIDENT GERALD FORD
TO A JOINT SESSION OF THE CONGRESS
Mr. Speaker, Mr. Vice President, Members of the 94th
Congress and distinguished guests;
As we begin our Bicentennial, America is still one of
the youngest Nations in recorded history. Long before our fore-
fathers came to these shores, men and women had been struggling
on this planet to forge a better life for themselves and their
families.
In man's long upward march from savagery and slavery --
throughout the nearly 2000 years of the Christian calendar, the
nearly 6000 years of Jewish reckoning -- there have been many
deep, terrifying valleys, but also many bright and towering peaks.
One peak stands highest in the ranges of human history.
One example shines forth of a people seeking to produce abundance and
to share the good life fairly and justly. One Union holds out
the promise of freedom and opportunity for every citizen.
That Union is the United States of America.
-2-
We have not remade paradise on earth. We know perfection
will not be found here. We cannot see beyond a generation forward
or back. But think for a minute how far we have come in 200 years.
We came from many roots and have many branches. Yet all
Americans across the eight generations that separate us from
the stirring deeds of 1776, those who know no other homeland
and those who just found refuge on our shores, say in-unison:
I am proud of America and proud to be an American. Life
will be better here for my children than for me.
I believe this not because I am told to believe it, but
because life-has been better for me than it was for my father and
my mother.
I know it will be better for my children because my hands,
my brains, my voice and my vote, can make it happen.
And it has happened here in America.
It happened to you and to me,
-3-
Government exists to create and preserve conditions in which
people can translate their ideals into practical reality. In
the best of times, much is lost in translation. But we try.
Sometimes we have tried and failed.
Always we have had the best of intentions. But we forgot
the sound principles that had guided us through most of our history
We wanted to accomplish great things and solve age-old problems.
And we became overconfident of our own abilities. We tried to
act as a policeman abroad and as a solicitous parent here at home.
We believed we could transform the country through massive national
programs;
-- But often the programs did not work; too often, they
only made things worse.
-- In our rush to accomplish great deeds quickly, we trampl
on sound principles of restraint, and endangered the rights of
individuals.
-- We unbalanced our economic system by the huge and
unprecedented growth of Federal expenditures and borrowing. And
-4-
we were not totally-truthful with ourselves about how much thes
programs would cost and how we would pay for them.
-- Finally, we lowered our priority for national defense
while the Soviets continued a massive buildup of arms.
The time has now come for a fundamentally different
approach -- for a new realism that is true to the great princip
upon which this nation. was founded.
We must introduce a new balance to our economy - a
balance that favors not only sound, active government but also
much more vigorous, healthier economy that can create new jobs
and hold down prices.
I believe we must introduce a new balance in the
relationship between the individual and the Government -- a
balance that favors greater individual freedom and self-relian
We must strike a new balance in our system of Federalist
a balance that favors greater responsibility and freedom for tl
leaders of our State and local governments.
-5-
We must introduce a new balance between spending on
----
domestic programs and spending on defense -- a balance that ensures
we fully meet our obligations to the needy while also protecting
our security in a world that is still hostile to freedom.
And in all that we do, we must be more honest with the
American people; promising them no more than we can deliver, and
delivering all that we promise.
The genius of America has been its incredible ability to
improve the lives of its citizens through a unique combination
of governmental and free citizen activity.
History- and experience tell us that moral progress comes
not in comfortable and complacent times, but out of trial and
confusion. Tom Paine aroused the troubled Americans of 1776
to stand up to the times that try men's souls, because the harder
the conflict the more glorious the triumph.
Just a year ago I reported that the State of the Union
was not good.
-6-
Tonight I report that the State of our Union is better --
in many ways a lot better -- but still not good enough.
To paraphrase Tom Paine, 1975 was not a year for summer
soldiers and sunshine patriots. It was a year of fears and alarms,
and of dire forecasts -- most of which never happened and won't
happen.
As you recall, the year 1975 opened with rancor and
bitterness. Political misdeeds of the past had neither been for-
gotten nor forgiven.
The longest, most divisive war in our history was
winding toward an unhappy conclusion. Many feared that the
end of that foreign war of men and machines meant the beginning
of a domestic war of recrimination and reprisal.
Friends and adversaries abroad were asking whether
America had lost its nerve.
Finally, our economy was ravaged by inflation -- inflation
that was plunging us into the worst recession in 34 years.
-7-
At the same time, Americans became increasingly alienated
from all big institutions. They were steadily losing confidence
not just in big government, but in big business, big labor and
big education.
Ours was a troubled land.
And so, 1975 was a year of hard decisions, difficult
compromises, and a new realism that taught us something
important about America.
It brought back a needed measure of common sense,
steadfastness and self-discipline. = Americans-did not panic
or demand instant but useless cures. In all sectors people
met their difficult problems with restraint and responsibility
worthy of their great heritage.
Add up the separate pieces of progress in 1975, subtract
the setbacks, and the sum total shows that we are not only headed
in the new direction I proposed 12 months ago, but that it
turned out to be the right direction.
-8-
It is the right direction because it follows the truly
revolutionary American concept of 1776 which holds that in
a free society, the making of public policy and successful problem
solving involves much more than government. It involves a full
partnership between all branches and levels of government,
private institutions and individual, citizens.
Common sense tells me to stick to that steady course.
Take the state of our economy.
Last January most things were rapidly getting worse.
This January most things are slowly but surely getting
better.
The worst recession since World War II turned around in
n
April. The best cost of living news of the past year is that
double digit inflation of 12% or higher was cut almost in half.
The worst -- unemployment remains way too high.
Today nearly 1.7 million more Americans are working than
at the bottom of the recession. At year's end people were
-9-
again being hired much faster than they were being laid off.
Yet let us be honest: many Americans have not yet felt
these changes in their daily lives. They still see prices
going up too fast, and they still know the fear of unemployment.
And we are a growing Nation. We need more and more jobs
every year. Today's total employment has produced over 85
million jobs for Americans, but we need a lot more jobs es-
pecially 'for the young.
My first objective is to have sound economic growth
without inflation.
We all know from recent experience what runaway inflation
does to ruin every other worthy purpose. We are slowing it;
we must stop it cold.
For many Americans the way to a healthy non-inflationary
economy has become increasingly apparent; the government must
stop spending so much and borrowing so much of our money;
- more money-must-remain in private hands where it will do the
-10-
most good. To hold down the cost of living, we must hold down
the cost of government.
In the past decade, the Federal budget has been
growing at an average rate of over 10 percent every year.
The budget I am submitting Wednesday cuts this rate of growth
in half. I have kept my promise to submit a budget for the next
fiscal year of $395 billion. In fact, it is $394.2 billion.
By holding down the growth in Federal spending, we can
afford additional tax cuts and return to the people who pay
taxes more decision-making power over their own lives.
Last month I signed legislation to extend the 1975 tax
reductions for the first six months of this year. I now
propose that effective July 1, 1976, we give our taxpayers a
tax cut of approximately $10 billion more than Congress agreed
to in December.
My broader tax reduction would mean that for a family
of four making $15,000 a year there will be $196 more in take
home pay annually. Hard-working Americans caught in the
-11-
middle can really use that kind of extra cash.
My recommendations for a firm restraint on the growth
of Federal spending and for greater tax reduction are
simple and straightforward. For every dollar saved in cutting
the growth in the Federal budget we can have an added dollar
of Federal tax reduction.
We can achieve a balanced budget by 1979 if we have
the courage and wisdom to continue to reduce the growth of
Federal spending.
One test of a healthy economy is a job for every
American who-wants to work.
Government -- our kind of government -- cannot create
that many jobs. But the Federal Government can create
conditions and incentives for private business and industry to
make more and more jobs.
Five out of six jobs in this country are in private
business and industry. Common sense tells us this is the
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place to look for more jobs and to find them faster.
I mean real, rewarding, permanent jobs.
To achieve this we must offer the American people
greater incentives to invest in the future.
-- I therefore propose that Congress enact changes
in Federal tax laws that will speed up plant expansion and the
purchase of new equipment. My recommendation will concentrate
this job-creation tax incentive in areas where the unemployment
rate now runs over 7 percent. Legislation to get this started
must be approved at the earliest possible date
Within the strict budget total I will recommend for the
additional having
coming year, I will ask for / Federal assistance for (the
families
struction of 500,000 additional homes. This program will expand
housing opportunities, spur construction and help to house
those with middle incomes and the poor.
We did not meet our housing goals in 1975. But with
lower interest rates and available mortgage money, we can have
a healthy recovery in 1976.
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A necessary condition of a healthy economy is
freedom from the petty tyranny of massive government regulatio
We are wasting literally millions of working hours costing
billions of consumers' dollars because of bureaucratic red tap
The American farmer who not only feeds 215 million Americans
and millions worldwide, has shown how much more he can produce
without the shackles of government control.
Now we need reforms in other key areas in our
economy -- the airlines, trucking, railroads, and banking.
I have concrete plans in each of these areas not to help this
or that industry but to foster=competition and-to-bring prices
down for the consumer.
This Administration will strictly enforcé the Federal
anti-trust laws for the same purpose.
Taking a longer look at America's future there can be
neither sustained growth nor more jobs unless we continue
to have an assured supply of energy to run our economy.
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Domestic production of oil and gas is still declining. Our
dependence on foreign oil at high prices is still increasing,
draining jobs and dollars away from our own economy at the
rate of $100 per year. for every American.
Last month I signed a compromise national energy bill
which enacts a part of my comprehensive energy independence
program. This legislation was late in coming, not the
complete answer to energy independence, but still at start
in the right direction.
(MORE)
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I again urge the Congress to move ahead immediately on
the remainder of my energy proposals to make America invulnerable
to the foreign oil cartel. My proposals would:
Reduce domestic natural gas shortages;
Permit use of Federally owned petroleum reserves;
Stimulate effective conservation, including revitali-
zation of our railroads and the expansion of our urban trans-
portation systems;
Develop synthetic fuels from our vast coal resources;
Expedite-clean and safe nuclear power production;
Create a new national Energy Independence Authority to
stimulate vital energy investment;
And accelerate development of technology to capture
energy from the sun and the earth for . this and future generations.
Also for the sake of future generations we must preserve
the family farm and family-owned small businesses. Both
strengthen America and give stability to our economy.
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I will propose estate tax changes so that family
businesses and small farms can be handed down from generation
to generation without having to be sold to pay taxes.
I propose tax changes to encourage people to invest
in America's future, and their own, through a plan that permits
lower and middle income families to claim income tax deductions
if they make long-term investments in common stock in American
companies.
The Federal Government must and will respond to clear-
cut national needs -- for this and future generations.
Hospital and medical services in America are among the
world's best but the cost of a serious and extended illness can
soon wipe out a family's lifetime savings. Increasing health costs
are of deep concern to all and a powerful force pushing up the
cost of living.
The burden of a catastrophic illness can be borne by very
few in our society. We must eliminate this fear from every family.
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I propose catastrophic health insurance for everybody
covered by Medicare. To finance this added protection, fees
for short-term care will go up somewhat, but nobody after
reaching age 60 will have to pay more than $500 a year for
hospital or nursing home care nor more than $250 for one year's
doctors' bills.
We cannot realistically afford Federally dictated
national health insurance providing full coverage for all
215 million Americans. The experience of other countries raises
questions about the quality as well as the cost of such plans.
But I do envision the day when we may use the private health
insurance system to offer more middle income families high quality
health services at prices they can afford and shield them also
from catastrophic illnesses.
Under the resources now available, I propose improving
the Medicare and other Federal health programs to help those
who really need more protection: older people and the poor.
-18-
To help States and local governments give better health care
to the poor I propose that we combine 16 existing Federal
programs including Medicaid into a single $10 billion Federal
grant.
Funds would be divided among the States under a new
formula which provides the most Federal money, not to the
States with the biggest budgets, but to those which have the
most low income families.
I will also continue to improve the quality of medical
and hospital care for those who have served in our- armed forces.
Now let me speak about Social Security.
Our Federal Social Security system for people who have
worked hard and contributed to it all their lives is a part of
our economic system. Its value is no longer debatable. In my
budget for fiscal year 1977 I am recommending that the full cost
of living increase in Social Security benefits be paid during
the coming year.
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But I am concerned about the integrity of our Social
Security Trust Fund that enables people -- those retired and
those still working who will retire -- to count on this source
of retirement income. Younger workers watch their deductions
rise and wonder if they will be adequately protected in the
future.
We must- meet this-challenge head-on.
Simple arithmetic warns all of us that the-Social
Security Trust Fund is headed for trouble. Unless we act
soon to make sure the fund takes in as much as it pays out,
there will be no security for old or young.
I must therefore recommend a 3/10 of one percent increase
in both employer and employee Social Security taxes effective
January 1, 1977. This will cost each covered employee less
than one extra dollar a week and will ensure the integrity of
the trust fund.
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As we rebuild our economy, we have a continuing respon-
sibility to provide a temporary cushion to the unemployed. At
my request the Congress enacted two extensions and expansions
in unemployment insurance which helped those who were jobless
during 1975. These programs will continue in 1976.
In my fiscal 1977 budget, I am also requesting funds to
continue proven job training and employment opportunity programs
for millions of other Americans.
Compassion and a sense of community -- two of America's
greatest strengths throughout our history -- tell us we must
take care of our neighbors who cannot take care of themselves.
The host of Federal programs in this field reflect our generosity
as a poeple.
But everyone realizes that when it comes to welfare, gover-
ment at all levels is not doing the job well. Too. many of our
welfare programs. are inequitable and invite abuse. Worse, we
are wasting badly needed resources without reaching many of the
truly needy.
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Complex welfare programs cannot be reformed overnight.
Surely we cannot simply dump welfare in the laps of the 50
States, their local taxpayers or private charities, and just
walk away from it. Nor is it the right time for massive and
sweeping changes while we are still recovering from a recession.
Nevertheless, there are still plenty of improvements
we make. I. will ask Congress for Presidential authority
to tighten up rules for eligibility and benefits.
Last year I twice sought long overdue reform of the
scandal riddled Food Stamp program. This year I say again:
Let's - give Food Stamps to those most in need. Let's not give
any to those who don't need them.
Protecting the life and property of the citizen at home
is the responsibility of all public officials but is primarily
the job of local and State law enforcement authorities.
Americans. have always found the very thought of a Federal
police force repugnant and so do I. Yet there are proper ways
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in which we can help to ensure domestic tranquility as the
Constitution charges US.
My recommendations on how to control violent crime were
submitted to the Congress last June with strong emphasis on
protecting the innocent victims of crime.
To keep a convicted criminal from committing more crimes
we must put him in prison so_he. cannot harm more law-abiding
citizens. Too often criminals are not sent to prison after
conviction but are allowed to return to the streets.
Some judges are reluctant to send convicted criminals to
prison because of inadequate prison facilities. To alleviate
this problem at the Federal level, my new budget proposes the
construction of four new Federal facilities.
To make justice more swift and certain for those arrested
for Federal crimes, I propose an increase this year in U.S.
Attorneys prosecuting Federal crimes and reinforcement of the
number of U.S. Marshals.
-23-
Additional Federal judges are needed, as I proposed last
year. This legislation recommended by me and the Judicial Con-
ference should be promptly enacted.
Another major threat to every American's person and
property is the criminal carrying a handgun. The way to cut
down on the criminal use of guns is not to take guns away from
the law-abiding citizen, but to impose mandatory sentences for
crimes in which a gun is used, make it harder to obtain cheap
guns for criminal purposes, and concentrate gun control enforce-
ment in high crime areas.
My budget recommends 500 additional Federal agents in
the 11 largest metropolitan high crime areas to help local
authorities stop criminals from selling and using handguns.
The sale of hard drugs is on the increase again. I have
directed all agencies of the Federal Government to step up
enforcement efforts against those who deal in drugs. Hard
drugs degrade the spirit as they destroy the body of their
users. Here the Federal responsibility is plain.
-24-
I recommended months ago that the Congress enact mandatory
fixed sentences for persons convicted of Federal crimes involving
selling hard drugs.
As President I have talked personally with the leaders of
Mexico, Col@mbia, and Turkey to urge greater efforts by their
governments to control effectively the production and shipment
of hard drugs.
It is unrealistic and misleading to hold out the hope
that the Federal Government can move in to every neighborhood
and clean up crime. Under the Constitution, the greatest res-
ponsibility for curbing crime lies with State and local authorities.
They are the frontline fighters in the war against crime.
There are definite ways in which the Federal Government can help
them. I will propose in the new budget that the Congress
authorize almost $7 billion over the next five years to assist
State and local governments to protect the safety and property
of all citizens.
-25-
As President I pledge the strict enforcement of Federal
laws and -- by example, support, and leadership -- to help State
and local authorities enforce their laws. Together we must protect
the victims of crime and ensure domestic tranquility.
Last year I strongly recommended a five-year extension of
22
the existing revenue sharing legislation which thus far has
$23.53
provided $19 billion to help State and local units of government
solve problems at home. This program has been effective with
decision making transferred from the Federal Government to
locally elected officials. Congress must act this year or
State and local units of government will have to drop programs
or raise local taxes.
In addition to my healthcare reforms, I propose to con-
solidate some 59 separate Federal programs and provide flexible
Federal dollar grants to help States, cities and local agencies
in such important areas as education, child nutrition, and
social services. This flexible system will do the job better
and do it closer to home.
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Now let me turn to the international arena.
In a world of instant communications and intercontinental
missiles, in a world economy that is global and interdependent,
our foreign policy becomes more, not less, important to the lives
of Americans.
America has had a unique moral role in the world since the
day of our independence 200 years ago. And for the last 30
years since the end of World War II, we have borne --
successfully -- a great responsibility for ensuring a stable
world order and hope for human progress.
Today, the structure of our foreign policy is strong.
- We are at peace -- and I intend to keep it that way.
-- Our military forces are the most advanced; our
military power is second to none. And I intend to keep it
that way.
Our principal alliances, with the industrial democracies
of the Atlantic Community and Japan, have never been more solid.
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-- A further agreement to limit the strategic arms
race is within reach.
- - We have a durable and improving relationship with
China, the world's most populous nation.
-- The elements for peace in the Middle East now exist,
for the first time.
-- We have taken the role of leadership in launching
a serious and hopeful dialogue between the industrial world and
the developing world.
-- Our many friendships with Latin America, Africa, and
Asia, endure.
We should be proud of what America has accomplished in
foreign affairs.
The American people have heard much of late aboutt how
terrible our mistakes, how evil our deeds, and how misguided
our purposes. The American people know better. It isn't true.
Our nation has passed through a decade of domestic trial
with its institutions as strong as ever. We are the world's
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greatest democracy. We continue to be the bastion of global
stability and security. We remain the symbol of man's aspirations
for liberty and well-being. We are the embodiment of hope for
progress.
And so my fellow-Americans, it is time we put a stop to
the attacks on ourselves. We have every obligation to draw
the right lessons from our past mistakes, to see that they never
happen again. But it is time to face our future. The world's
problems do not go away.
The American people want an effective and-strong
foreign policy.
In our Constitutional system, foreign policy must be the
product of consultation and accommodation between the President
and Congress. But in the last analysis, as our Founding Fathers
knew, the foreign relations of the United States can be conducted
effectively only if there is strong central direction and action
That responsibility can only rest with the President. I intend
to uphold that responsibility.
-29-
I pledge to the American people a foreign policy which seeks
e
a secure, just, and peacuful world. I pledge to the Congress --
my colleagues -- to work with you to that end.
We must not face a future in which we can no longer help
our friends, such as in Angola -- even in limited and carefully
controlled ways -- because of the trauma of a past decade. We
must not lose all capacity to respond short of an all-out war.
The-unwise actions of the Congress-during the past year -- most
recently in Angola -- are very much on the minds of our allies
and our adversaries. The preservation of our role as a world
leader and perhaps our own security depends on how we answer
these questions of today.
-30-
We must, as well, be deeply concerned about our military
strength.
A strong defense posture gives weight to our values and
our views in international negotiations; it assures the vigor
of our alliances; and it sustains our efforts to promote settle-
ments of international conflicts and slows down the nuclear arms
race that could threaten our safety and the peace of the world.
The Defense Budget that I shall submit to the Congress
for fiscal 1977 will show an essential increase over last year.
There is a 7.5 percent growth in purchasing power over last
year's Defense Budget, which includes, among other things, the
costs of supporting our Al1-Volunteer Force.
We are making continuing economies, to enhance the efficiency
of our military forces. But the budget that I will submit
represents the necessity of American strength for the perilous
period in which we live.
-31-
As conflict and competition inevitably continue in the
world, I can think of nothing more vital than our intelligence
capabilities.
The crippling of our foreign intelligence services only
increases the danger of American involvement in direct military
conflict. Our adversaries are encouraged to attempt new adven-
tures, while our own ability to monitor events, to gauge the
intentions of others and to chart a course in the best interests
of this Nation -- and to influence events short of military
action -- is undermined.
Deprived of an effective intelligence capability, we will
stand blindfolded and hobbled.
In the near future, I will take actions to reform and
strengthen our intelligence community. I ask for your positive
cooperation. We must end the assault on our own vital institutions.
It is time to go beyond sensationalism to the hard work of re-
building an effective, responsible, and responsive foreign
intelligence capability.
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I have spoken of our problems at home and abroad. I
have recommended policies that will meet the challenge of our
third century.
I have no doubt that our Union will endure -- better,
stronger and with more individual freedom.
We can see forward only dimly -- one year, five years,
a generation perhaps. - Like our forefathers, we know that if we
meet the challenges of our own time with a common sense of
purpose and conviction -- if we remain true to our Constitution
and our ideals -- then we can know that the future will be
better than the past.
I see America today crossing a threshhold, not just
because it is our Bicentennial, but because we have been tested
in adversity and taken a new look at what we want to be and
what we want our nation to become.
I see America resurgent, certain once again that life
will be better for our children than it is for us, seeking
-33-
strength that cannot be counted in megatons and riches that
cannot be eroded by inflation.
I see these United States of America, moving forward
as before toward a more perfect Union where a government serves
and the people rule.
We will not make this happen by making speeches, good or
bad, yours, or mine, but by hard work and hard decisions made
with courage and common sense.
I have heard many inspired Presidential speeches, but
the words I remember best were
spoken by Dwight D.
Eisenhower.
"America is not good because it is great," the President
said. "America is great because it is good. "
President Eisenhower was raised in a poor but religious
home in the heart of America. His simple words echoed President
Lincoln's eloquent testament that "right makes might. " And
Lincoln in turn evoked the silent image of George Washington
kneeling in prayer at Valley Forge.
-34-
So all these magic memories, which link eight generations
of Americans, are summed up in the inscription just above me.
How many times have we seen it? -- "In God We Trust. "
Let us engrave it now in each of our hearts as we begin
our Bicentennial.
END OF TEXT
B. FORD LIBR,