You wouldn't want to talk me into an encore, would you? Mr. Speaker, Mr.
President, distinguished Members of the Congress, honored guests, and fellow
citizens: I have no words to express my appreciation for that greeting. I have
come to speak to you tonight about our economic recovery program and why I
believe it's essential that the Congress approve this package, which I believe
will lift the crushing burden of inflation off of our citizens and restore the
vitality to our economy and our industrial machine.
First, however, and due to events of the past few weeks, will you permit me to
digress for a moment from the all-important subject of why we must bring
government spending under control and reduce tax rates. I'd like to say a few
words directly to all of you and to those who are watching and listening
tonight, because this is the only way I know to express to all of you on
behalf of Nancy and myself our appreciation for your messages and flowers and,
most of all, your prayers, not only for me but for those others who fell beside
me. The warmth of your words, the expression of friendship and, yes, love,
meant more to us than you can ever know. You have given us a memory that
we'll treasure forever. And you've provide an answer to those few voices that
were raised saying that what happened was evidence that ours is a sick
society.
The society we heard from is made up of millions of compassionate Americans and
their children, from college-age to kindergarten. As a matter of fact, as
evidence of that I have a letter with me. The letter came from Peter Sweeney.
He's in the second grade in the Riverside School in Rockville Centre, and he
said, "I hope you get well quick or you might have to make a speech in your
pajamas." And he added a postscript. "P.S. If you have to make a speech in
your pajamas, I warned you."
Well, sick societies don't produce men like the two who recently returned from
outer space. Sick societies don't produce young men like Secret Service agent
Tim McCarthy, who placed his body--he placed his body between mine and the man
with the gun simply because he felt that's what his duty called for him to do.
Sick societies don't produce dedicated police officers like Tom Delahanty or
able and devoted public servants like Jim Brady. Sick societies don't make
people like us so proud to be Americans and so very proud of our fellow
citizens.
Now, let's talk about getting spending and inflation under control and cutting
your tax rates. Mr. Speaker and Senator Baker, I want to thank you for your
cooperation in helping to arrange this joint session of the Congress. I won't
be speaking to you very long tonight, but I asked for this meeting because the
urgency of our joint mission has not changed. Thanks to some very fine people,
my health is much improved. I'd like to be able to say that with regard to the
health of the economy.
It's been half a year since the election that charged all of us in this
government with the task of restoring our economy. And where have we come in
this six months? Inflation, as measured by the Consumer Price Index, has
continued at a double-digit rate. Mortgage interest rates have averaged almost
15 percent for these six months, preventing families across America from buying
homes. There are still almost eight million unemployed. The average worker's
hourly earnings after adjusting for inflation are lower today than they were
six months ago, and there have been over 6,000 business failures.
Six months is long enough. The American people now want us to act and not in
half-measures. They demand and they've earned a full and comprehensive effort
to clean up our economic mess. Because of the extent of our economy's sickness,
we know that the cure will not come quickly and that even with our package,
progress will come in inches and feet, not in miles. But to fail to act will
delay even longer and more painfully the cure which must come. And that cure
begins with the federal budget. And the budgetary actions taken by the Congress
over the next few days will determine how we respond to the message of last
November 4th. That message was very simple. Our government is too big, and it
spends too much.
For the last few months, you and I have enjoyed a relationship based on
extraordinary cooperation. Because of this cooperation we've come a long
distance in less than three months. I want to thank the leadership of the
Congress for helping in setting a fair timetable for consideration of our
recommendations. And committee chairmen on both sides of the aisle have called
prompt and thorough hearings. We have also communicated in a spirit of candor,
openness, and mutual respect. Tonight, as our decision day nears and as the
House of Representatives weighs its alternatives, I wish to address you in that
same spirit.
The Senate Budget Committee, under the leadership of Pete Domenici, has just
today voted out a budget resolution supported by Democrats and Republicans
alike that is in all major respects consistent with the program that we have
proposed. Now we look forward to favorable action on the Senate floor, but an
equally crucial test involves the House of Representatives. The House will soon
be choosing between two different versions or measures to deal with the
economy. One is the measure offered by the House Budget Committee. The other is
a bipartisan measure, a substitute introduced by Congressmen Phil Gramm of
Texas and Del Latta of Ohio.
On behalf of the administration, let me say that we embrace and fully support
that bipartisan substitute. It will achieve all the essential aims of
controlling government spending, reducing the tax burden, building a national
defense second to none, and stimulating economic growth and creating millions
of new jobs. At the same time, however, I must state our opposition to the
measure offered by the House Budget Committee. It may appear that we have two
alternatives. In reality, however, there are no more alternatives left.
The committee measure quite simply falls far too short of the essential actions
that we must take. For example, in the next three years, the committee measure
projects spending $141 billion more than does the bipartisan substitute. It
regrettably cuts over $14 billion in essential defense spending, funding
required to restore America's national security. It adheres to the failed
policy of trying to balance the budget on the taxpayer's back. It would
increase tax payments over a third, adding up to a staggering quarter of a
trillion dollars. Federal taxes would increase 12 percent each year. Taxpayers
would be paying a larger share of their income to the government in 1984 than
they do at present. In short, that measure reflects an echo of the past rather
than a benchmark for the future. High taxes and excess spending growth created
our present economic mess; more of the same will not cure the hardship,
anxiety, and discouragement it has imposed on the American people.
Let us cut through the fog for a moment. The answer to a government that's too
big is to stop feeding its growth. Government spending has been growing faster
than the economy itself. The massive national debt which we accumulated is the
result of the government's high spending diet. Well, it's time to change the
diet and to change it in the right way.
I know the tax portion of our package is of concern to some of you. Let me make
a few points that I think--feel have been overlooked. First of all, it should
be looked at as an integral part of the entire package, not something separate
and apart from the budget reductions, the regulatory relief, and the monetary
restraints. Probably the most common misconception is that we are proposing to
reduce government revenues to less than what the government has been receiving.
This is not true. Actually, the discussion has to do with how much of a tax
increase should be imposed on the taxpayer in 1982.
Now, I know that over the recess in some informal polling some of your
constituents have been asked which they'd rather have, a balanced budget or a
tax cut, and with the common sense that characterizes the people of this
country, the answer, of course, has been a balanced budget. But may I suggest,
with no inference that there was wrong intent on the part of those who asked
the question, the question was inappropriate to the situation. Our choice is
not between a balanced budget and a tax cut. Properly asked, the question is,
"Do you want a great big raise in your taxes this coming year or, at the worst,
a very little increase with the prospect of tax reduction and a balanced budget
down the road a ways?" With the common sense that the people have already
shown, I'm sure we all know what the answer to that question would be.
A gigantic tax increase has been built into the system. We propose nothing more
than a reduction of that increase. The people have a right to know that even
with our plan they will be paying more in taxes, but not as much more as they
will without it. The option, I believe, offered by the House Budget Committee,
will leave spending too high and tax rates too high. At the same time, I think
it cuts the defense budget too much, and by attempting to reduce the deficit
through higher taxes, it will not create the kind of strong economic growth and
the new jobs that we must have.
Let us not overlook the fact that the small, independent business man or woman
creates more than 80 percent of all the new jobs and employs more than half of
our total work force. Our across-the-board cut in tax rates for a three-year
period will give them much of the incentive and promise of stability they need
to go forward with expansion plans calling for additional employees.
Tonight, I renew my call for us to work as a team, to join in cooperation so
that we find answers which will begin to solve all our economic problems and
not just some of them. The economic recovery package that I've outlined to you
over the past weeks is, I deeply believe, the only answer that we have left.
Reducing the growth of spending, cutting marginal tax rates, providing relief
from overregulation, and following a noninflationary and predictable monetary
policy are interwoven measures which will ensure that we have addressed each of
the severe dislocations which threaten our economic future. These policies will
make our economy stronger, and the stronger economy will balance the budget
which we're committed to do by 1984.
When I took the oath of office, I pledged loyalty to only one special interest
group--"We the People. " Those people--neighbors and friends, shopkeepers and
laborers, farmers and craftsmen--do not have infinite patience. As a matter of
fact, some 80 years ago, Teddy Roosevelt wrote these instructive words in his
first message to the Congress: "The American people are slow to wrath, but when
their wrath is once kindled, it burns like a consuming flame. " Well, perhaps
that kind of wrath will be deserved if our answer to these serious problems is
to repeat the mistakes of the past.
The old and comfortable way is to shave a little here and a little there. Well,
that's not acceptable anymore. I think this great and historic Congress knows
that way is no longer acceptable. Thank you very much. Thank you. I think
you've shown that you know the one sure way to continue the inflationary spiral
is to fall back into the predictable patterns of old economic practices. Isn't
it time that we tried something new? When you allowed me to speak to you here
in these chambers a little earlier, I told you that I wanted this program for
economic recovery to be ours--yours and mine. I think the bipartisan substitute
bill has achieved that purpose. It moves us toward economic vitality.
Just two weeks ago, you and I joined millions of our fellow Americans in
marveling at the magic historical moment that John Young and Bob Crippen
created in their space shuttle Columbia. The last manned effort was almost six
years ago, and I remembered on this more recent day, over how--over the years,
how we'd all come to expect technological precision of our men and machines.
And each amazing achievement became commonplace, until the next new challenge
was raised. With the space shuttle we tested our ingenuity once again, moving
beyond the accomplishments of the past into the promise and uncertainty of the
future. Thus, we not only planned to send up a 122-foot aircraft 170 miles into
space, but we also intended to make it maneuverable and return it to earth,
landing 98 tons of exotic metals delicately on a remote, dry lake bed. The
space shuttle did more than prove our technological abilities. It raised our
expectations once more. It started us dreaming again.
The poet Carl Sandburg wrote, "The republic is a dream. Nothing happens unless
first a dream." And that's what makes us, as Americans, different. We've always
reached for a new spirit and aimed at a higher goal. We've been courageous and
determined, unafraid and bold. Who among us wants to be first to say we no
longer have those qualities, that we must limp along, doing the same things
that have brought us our present misery? I believe that the people you and I
represent are ready to chart a new course. They look to us to meet the great
challenge, to reach beyond the commonplace and not fall short for lack of
creativity or courage. Someone, you know, has said that he who would have
nothing to do with thorns must never attempt to gather flowers. Well, we have
much greatness before us. We can restore our economic strength and build
opportunities like none we've ever had before. As Carl Sandburg said, all we
need to begin with is a dream that we can do better than before. All we need to
have is faith, and that dream will come true. All we need to do is act, and the
time for action is now.
Thank you. Good night.
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