Speech Transcript:

Mr. President, Mr. Speaker, Members of the House and the Senate,
distinguished Americans here as visitors in this Chamber, as am I. It
is nice to have a fresh excuse for giving a long speech.

When Presidents speak to Congress and the Nation from this podium,
typically they comment on the full range in challenges and
opportunities that face the United States. But this is not an
ordinary time, and for all the many tasks that require our attention,
I believe tonight one calls on us to focus, to unite, and to act. And
that is our economy. For more than anything else, our task tonight as
Americans is to make our economy thrive again.

Let me begin by saying that it has been too long, at least three
decades, since a President has come and challenged Americans to join
him on a great national journey, not merely to consume the bounty of
today but to invest for a much greater one tomorrow.

Like individuals, nations must ultimately decide how they wish to
conduct themselves, how they wish to be thought of by those with whom
they live, and later, how they wish to be judged by history. Like
every individual man and woman, nations must decide whether they are
prepared to rise to the occasions history presents them.

We have always been a people of youthful energy and daring spirit.
And at this historic moment, as communism has fallen, as freedom is
spreading around the world, as a global economy is taking shape
before our eyes, Americans have called for change. And now it is up
to those of us in this room to deliver for them.

Our Nation needs a new direction. Tonight I present to you a
comprehensive plan to set our Nation on that new course. I believe we
will find our new direction in the basic old values that brought us
here over the last two centuries: a commitment to opportunity, to
individual responsibility, to community, to work, to family, and to
faith. We must now break the habits of both political parties and say
there can be no more something for nothing and admit frankly that we
are all in this together.

The conditions which brought us as a nation to this point are
well-known: two decades of low productivity, growth, and stagnant
wages; persistent unemployment and underemployment; years of huge
Government deficits and declining investment in our future; exploding
health care costs and lack of coverage for millions of Americans;
legions of poor children; education and job training opportunities
inadequate to the demands of this tough, global economy. For too long
we have drifted without a strong sense of purpose or responsibility or
community.

And our political system so often has seemed paralyzed by special
interest groups, by partisan bickering, and by the sheer complexity
of our problems. I believe we can do better because we remain the
greatest nation on Earth, the world's strongest economy, the world's
only military superpower. If we have the vision, the will, and the
heart to make the changes we must, we can still enter the 21st
century with possibilities our parents could not even have imagined
and enter it having secured the American dream for ourselves and for
future generations.

I well remember 12 years ago President Reagan stood at this very
podium and told you and the American people that if our national debt
were stacked in thousand-dollar bills, the stack would reach 67 miles
into space. Well, today that stack would reach 267 miles. I tell you
this not to assign blame for this problem. There is plenty of blame
to go around in both branches of the Government and both parties. The
time has come for the blame to end. I did not seek this office to
place blame. I come here tonight to accept responsibility, and I want
you to accept responsibility with me. And if we do right by this
country, I do not care who gets the credit for it.

The plan I offer you has four fundamental components. First, it
shifts our emphasis in public and private spending from consumption
to investment, initially by jumpstarting the economy in the short
term and investing in our people, their jobs, and their incomes over
the long run. Second, it changes the rhetoric of the past into the
actions of the present by honoring work and families in every part of
our public decision-making. Third, it substantially reduces the
Federal deficit honestly and credibly by using in the beginning the
most conservative estimates of Government revenues, not, as the
executive branch has done so often in the past, using the most
optimistic ones. And finally, it seeks to earn the trust of the
American people by paying for these plans first with cuts in
Government waste and efficiency; second, with cuts, not gimmicks, in
Government spending; and by fairness, for a change, in the way
additional burdens are borne.

Tonight I want to talk with you about what Government can do because
I believe Government must do more. But let me say first that the real
engine of economic growth in this country is the private sector, and
second, that each of us must be an engine of growth and change. The
truth is that as Government creates more opportunity in this new and
different time, we must also demand more responsibility in turn.

Our immediate priority must be to create jobs, create jobs now. Some
people say, "Well, we're in a recovery, and we don't have to do
that." Well, we all hope we're in a recovery, but we're sure not
creating new jobs. And there's no recovery worth its salt that
doesn't put the American people back to work.

To create jobs and guarantee a strong recovery, I call on Congress to
enact an immediate package of jobs investments of over $30 billion to
put people to work now, to create a half a million jobs: jobs to
rebuild our highways and airports, to renovate housing, to bring new
life to rural communities, and spread hope and opportunity among our
Nation's youth. Especially I want to emphasize, after the events of
last year in Los Angeles and the countless stories of despair in our
cities and in our poor rural communities, this proposal will create
almost 700,000 new summer jobs for displaced, unemployed young people
alone this summer. And tonight I invite America's business leaders to
join us in this effort so that together we can provide over one
million summer jobs in cities and poor rural areas for our young
people.

Second, our plan looks beyond today's business cycle because our
aspirations extend into the next century. The heart of this plan
deals with the long term. It is an investment program designed to
increase public and private investment in areas critical to our
economic future. And it has a deficit reduction program that will
increase the savings available for the private sector to invest, will
lower interest rates, will decrease the percentage of the Federal
budget claimed by interest payments, and decrease the risk of
financial market disruptions that could adversely affect our
economy.

Over the long run, all this will bring us a higher rate of economic
growth, improved productivity, more high-quality jobs, and an
improved economic competitive position in the world. In order to
accomplish both increased investment and deficit reduction, something
no American Government has ever been called upon to do at the same
time before, spending must be cut and taxes must be raised.

The spending cuts I recommend were carefully thought through in a way
to minimize any adverse economic impact, to capture the peace dividend
for investment purposes, and to switch the balance in the budget from
consumption to more investment. The tax increases and the spending
cuts were both designed to assure that the cost of this historic
program to face and deal with our problems will be borne by those who
could readily afford it the most. Our plan is designed, furthermore,
and perhaps in some ways most importantly, to improve the health of
American business through lower interest rates, more incentives to
invest, and better trained workers.

Because small business has created such a high percentage of all the
new jobs in our Nation over the last 10 or 15 years, our plan
includes the boldest targeted incentives for small business in
history. We propose a permanent investment tax credit for the
smallest firms in this country, with revenues of under $5 million.
That's about 90 percent of the firms in America, employing about 40
percent of the work force but creating a big majority of the net new
jobs for more than a decade. And we propose new rewards for
entrepreneurs who take new risks. We propose to give small business
access to all the new technologies of our time. And we propose to
attack this credit crunch which has denied small business the credit
they need to flourish and prosper.

With a new network of community development banks and $1 billion to
make the dream of enterprise zones real, we propose to bring new hope
and new jobs to storefronts and factories from south Boston to south
Texas to south central Los Angeles. This plan invests in our roads,
our bridges, our transit systems, in high-speed railways and
high-tech information systems. And it provides the most ambitious
environmental cleanup in partnership with State and local government
of our time, to put people to work and to preserve the environment
for our future.

Standing as we are on the edge of a new century, we know that
economic growth depends as never before on opening up new markets
overseas and expanding the volume of world trade. And so, we will
insist on fair trade rules in international markets as a part of a
national economic strategy to expand trade, including the successful
completion of the latest round of world trade talks and the
successful completion of a North American Free Trade Agreement with
appropriate safeguards for our workers and for the environment.

At the same time—and I say this to you in both parties and across
America tonight, all the people who are listening—it is not enough to
pass a budget or even to have a trade agreement. This world is
changing so fast that we must have aggressive, targeted attempts to
create the high-wage jobs of the future. That's what all our
competitors are doing. We must give special attention to those
critical industries that are going to explode in the 21st century but
that are in trouble in America today, like aerospace. We must provide
special assistance to areas and to workers displaced by cuts in the
defense budget and by other unavoidable economic dislocations.

And again I will say we must do this together. I pledge to you that I
will do my best to see that business and labor and Government work
together for a change.

But all of our efforts to strengthen the economy will fail—let me say
this again; I feel so strongly about this—all of our efforts to
strengthen the economy will fail unless we also take this year, not
next year, not 5 years from now but this year, bold steps to reform
our health care system.

In 1992, we spent 14 percent of our income on health care, more than
30 percent more than any other country in the world, and yet we were
the only advanced nation that did not provide a basic package of
health care benefits to all of its citizens. Unless we change the
present pattern, 50 percent of the growth in the deficit between now
and the year 2000 will be in health care costs. By the year 2000
almost 20 percent of our income will be in health care. Our families
will never be secure, our businesses will never be strong, and our
Government will never again be fully solvent until we tackle the
health care crisis. We must do it this year.

The combination of the rising cost of care and the lack of care and
the fear of losing care are endangering the security and the very
lives of millions of our people. And they are weakening our economy
every day. Reducing health care costs can liberate literally hundreds
of billions of dollars for new investment in growth and jobs. Bringing
health costs in line with inflation would do more for the private
sector in this country than any tax cut we could give and any
spending program we could promote. Reforming health care over the
long run is critically essential to reducing not only our deficit but
to expanding investment in America.

Later this spring, after the First Lady and the many good people who
are helping her all across the country complete their work, I will
deliver to Congress a comprehensive plan for health care reform that
finally will bring costs under control and provide security to all of
our families, so that no one will be denied the coverage they need but
so that our economic future will not be compromised either. We'll have
to root out fraud and overcharges and make sure that paperwork no
longer chokes your doctor. We'll have to maintain the highest
American standards and the right to choose in a system that is the
world's finest for all those who can access it. But first we must
make choices. We must choose to give the American people the quality
they demand and deserve with a system that will not bankrupt the
country or further drive more Americans into agony.

Let me further say that I want to work with all of you on this. I
realize this is a complicated issue. But we must address it. And I
believe if there is any chance that Republicans and Democrats who
disagree on taxes and spending or anything else could agree on one
thing, surely we can all look at these numbers and go home and tell
our people the truth. We cannot continue these spending patterns in
public or private dollars for health care for less and less and less
every year. We can do better. And I will work to do better.

Perhaps the most fundamental change the new direction I propose
offers is its focus on the future and its investment which I seek in
our children. Each day we delay really making a commitment to our
children carries a dear cost. Half of the 2-year-olds in this country
today don't receive the immunizations they need against deadly
diseases. Our plan will provide them for every eligible child. And we
know now that we will save $10 later for every $1 we spend by
eliminating preventable childhood diseases. That's a good investment
no matter how you measure it.

I recommend that the women, infants, and children's nutrition program
be expanded so that every expectant mother who needs the help gets it.
We all know that Head Start, a program that prepares children for
school, is a success story. We all know that it saves money. But
today it just reaches barely over one-third of all the eligible
children. Under this plan, every eligible child will be able to get a
head start. This is not just the right thing to do; it is the smart
thing to do. For every dollar we invest today, we'll save $3
tomorrow. We have to start thinking about tomorrow. I've heard that
somewhere before. [Laughter]

We have to ask more in our schools of our students, our teachers, our
principals, our parents. Yes, we must give them the resources they
need to meet high standards, but we must also use the authority and
the influence and the funding of the Education Department to promote
strategies that really work in learning. Money alone is not enough.
We have to do what really works to increase learning in our schools.

We have to recognize that all of our high school graduates need some
further education in order to be competitive in this global economy.
So we have to establish a partnership between businesses and
education and the Government for apprenticeship programs in every
State in this country to give our people the skills they need.
Lifelong learning must benefit not just young high school graduates
but workers, too, throughout their career. The average 18-year-old
today will change jobs seven times in a lifetime. We have done a lot
in this country on worker training in the last few years, but the
system is too fractured. We must develop a unified, simplified,
sensible, streamlined worker-training program so that workers receive
the training they need regardless of why they lost their jobs or
whether they simply need to learn something new to keep them. We have
got to do better on this.

And finally, I propose a program that got a great response from the
American people all across this country last year: a program of
national service to make college loans available to all Americans and
to challenge them at the same time to give something back to their
country as teachers or police officers or community service workers;
to give them the option to pay the loans back, but at tax time so
they can't beat the bill, but to encourage them instead to pay it
back by making their country stronger and making their country better
and giving us the benefit of their knowledge.

A generation ago when President Kennedy proposed and the United
States Congress embraced the Peace Corps, it defined the character of
a whole generation of Americans committed to serving people around the
world. In this national service program, we will provide more than
twice as many slots for people before they go to college to be in
national service than ever served in the Peace Corps. This program
could do for this generation of Members of Congress what the land
grant college act did and what the GI bill did for former
Congressmen. In the future, historians who got their education
through the national service loan will look back on you and thank you
for giving America a new lease on life, if you meet this challenge.

If we believe in jobs and we believe in learning, we must believe in
rewarding work. If we believe in restoring the values that make
America special, we must believe that there is dignity in all work,
and there must be dignity for all workers. To those who care for our
sick, who tend our children, who do our most difficult and tiring
jobs, the new direction I propose will make this solemn, simple
commitment: By expanding the refundable earned-income tax credit, we
will make history. We will reward the work of millions of working
poor Americans by realizing the principle that if you work 40 hours a
week and you've got a child in the house, you will no longer be in
poverty.

Later this year, we will offer a plan to end welfare as we know it. I
have worked on this issue for the better part of a decade. And I know
from personal conversations with many people that no one, no one
wants to change the welfare system as badly as those who are trapped
in it. I want to offer the people on welfare the education, the
training, the child care, the health care they need to get back on
their feet, but say after 2 years they must get back to work, too, in
private business if possible, in public service if necessary. We have
to end welfare as a way of life and make it a path to independence
and dignity.

Our next great goal should be to strengthen our families. I
compliment the Congress for passing the Family and Medical Leave Act
as a good first step, but it is time to do more. This plan will give
this country the toughest child support enforcement system it has
ever had. It is time to demand that people take responsibility for
the children they bring in this world.

And I ask you to help to protect our families against the violent
crime which terrorizes our people and which tears our communities
apart. We must pass a tough crime bill. I support not only the bill
which didn't quite make it to the President's desk last year but also
an initiative to put 100,000 more police officers on the street, to
provide boot camps for first-time nonviolent offenders for more space
for the hardened criminals in jail. And I support an initiative to do
what we can to keep guns out of the hands of criminals. Let me say
this. I will make you this bargain: If you will pass the Brady bill,
I'll sure sign it.

Let me say now, we should move to the harder parts.

I think it is clear to every American, including every Member of
Congress of both parties, that the confidence of the people who pay
our bills in our institutions in Washington is not high. We must
restore it. We must begin again to make Government work for ordinary
taxpayers, not simply for organized interest groups. And that
beginning must start with real political reform. I am asking the
United States Congress to pass a real campaign finance reform bill
this year. I ask you to increase the participation of the American
people by passing the motor voter bill promptly. I ask you to deal
with the undue influence of special interests by passing a bill to
end the tax deduction for lobbying and to act quickly to require all
the people who lobby you to register as lobbyists by passing the
lobbying registration bill.

Believe me, they were cheering that last section at home. I believe
lobby reform and campaign finance reform are a sure path to increased
popularity for Republicans and Democrats alike because it says to the
voters back home, "This is your House. This is your Senate. We're
your hired hands, and every penny we draw is your money."

Next, to revolutionize Government we have to ensure that we live
within our means, and that should start at the top and with the White
House. In the last few days I have announced a cut in the White House
staff of 25 percent, saving approximately $10 million. I have ordered
administrative cuts in budgets of agencies and departments. I have cut
the Federal bureaucracy, or will over the next 4 years, by
approximately 100,000 positions, for a combined savings of $9
billion. It is time for Government to demonstrate, in the condition
we're in, that we can be as frugal as any household in America.

And that's why I also want to congratulate the Congress. I noticed
the announcement of the leadership today that Congress is taking
similar steps to cut its costs. I think that is important. I think it
will send a very clear signal to the American people.

But if we really want to cut spending, we're going to have to do
more, and some of it will be difficult. Tonight I call for an
across-the-board freeze in Federal Government salaries for one year.
And thereafter, during this 4-year period, I recommend that salaries
rise at one point lower than the cost of living allowance normally
involved in Federal pay increases.

Next, I recommend that we make 150 specific budget cuts, as you know,
and that all those who say we should cut more be as specific as I have
been.
            Finally, let me say to my friends on both sides of the
aisle, it is not enough simply to cut Government; we have to rethink
the whole way it works. When I became President I was amazed at just
the way the White House worked, in ways that added lots of money to
what taxpayers had to pay, outmoded ways that didn't take maximum
advantage of technology and didn't do things that any business would
have done years ago to save taxpayers' money.

So I want to bring a new spirit of innovation into every Government
Department. I want to push education reform, as I said, not just to
spend more money but to really improve learning. Some things work,
and some things don't. We ought to be subsidizing the things that
work and discouraging the things that don't. I'd like to use that
Superfund to clean up pollution for a change and not just pay
lawyers.

In the aftermath of all the difficulties with the savings and loans,
we must use Federal bank regulators to protect the security and
safety of our financial institutions, but they should not be used to
continue the credit crunch and to stop people from making sensible
loans.

I'd like for us to not only have welfare reform but to reexamine the
whole focus of all of our programs that help people, to shift them
from entitlement programs to empowerment programs. In the end we want
people not to need us anymore. I think that's important.

But in the end we have to get back to the deficit. For years there's
been a lot of talk about it but very few credible efforts to deal
with it. And now I understand why, having dealt with the real numbers
for 4 weeks. But I believe this plan does; it tackles the budget
deficit seriously and over the long term. It puts in place one of the
biggest deficit reductions and one of the biggest changes in Federal
priorities, from consumption to investment, in the history of this
country at the same time over the next 4 years.

Let me say to all the people watching us tonight who will ask me
these questions beginning tomorrow as I go around the country and
who've asked it in the past: We're not cutting the deficit just
because experts say it's the thing to do or because it has some
intrinsic merit. We have to cut the deficit because the more we spend
paying off the debt, the less tax dollars we have to invest in jobs
and education and the future of this country. And the more money we
take out of the pool of available savings, the harder it is for
people in the private sector to borrow money at affordable interest
rates for a college loan for their children, for a home mortgage, or
to start a new business.

That's why we've got to reduce the debt, because it is crowding out
other activities that we ought to be engaged in and that the American
people ought to be engaged in. We cut the deficit so that our children
will be able to buy a home, so that our companies can invest in the
future and in retraining their workers, so that our Government can
make the kinds of investments we need to be a stronger and smarter
and safer nation.

If we don't act now, you and I might not even recognize this
Government 10 years from now. If we just stay with the same trends of
the last 4 years, by the end of the decade the deficit will be $635
billion a year, almost 80 percent of our gross domestic product. And
paying interest on that debt will be the costliest Government program
of all. We'll still be the world's largest debtor. And when Members of
Congress come here, they'll be devoting over 20 cents on the dollar to
interest payments, more than half of the budget to health care and to
other entitlements. And you'll come here and deliberate and argue
over 6 or 7 cents on the dollar, no matter what America's problems
are. We will not be able to have the independence we need to chart
the future that we must. And we'll be terribly dependent on foreign
funds for a large portion of our investment.

This budget plan, by contrast, will by 1997 cut $140 billion in that
year alone from the deficit, a real spending cut, a real revenue
increase, a real deficit reduction, using the independent numbers of
the Congressional Budget Office. [Laughter] Well, you can laugh, my
fellow Republicans, but I'll point out that the Congressional Budget
Office was normally more conservative in what was going to happen and
closer to right than previous Presidents have been.

I did this so that we could argue about priorities with the same set
of numbers. I did this so that no one could say I was estimating my
way out of this difficulty. I did this because if we can agree
together on the most prudent revenues we're likely to get if the
recovery stays and we do right things economically, then it will turn
out better for the American people than we say. In the last 12 years,
because there were differences over the revenue estimates, you and I
know that both parties were given greater elbow room for
irresponsibility. This is tightening the rein on the Democrats as
well as the Republicans. Let's at least argue about the same set of
numbers so the American people will think we're shooting straight
with them.

As I said earlier, my recommendation makes more than 150 difficult
reductions to cut the Federal spending by a total of $246 billion. We
are eliminating programs that are no longer needed, such as nuclear
power research and development. We're slashing subsidies and
canceling wasteful projects. But many of these programs were
justified in their time, and a lot of them are difficult for me to
recommend reductions in, some really tough ones for me personally. I
recommend that we reduce interest subsidies to the Rural Electric
Administration. That's a difficult thing for me to recommend. But I
think that I cannot exempt the things that exist in my State or in my
experience, if I ask you to deal with things that are difficult for
you to deal with. We're going to have to have no sacred cows except
the fundamental abiding interest of the American people.

I have to say that we all know our Government has been just great at
building programs. The time has come to show the American people that
we can limit them too; that we can not only start things, that we can
actually stop things.

About the defense budget, I raise a hope and a caution. As we
restructure our military forces to meet the new threats of the
post-cold-war world, it is true that we can responsibly reduce our
defense budget. And we may all doubt what that range of reductions
is, but let me say that as long as I am President, I will do
everything I can to make sure that the men and women who serve under
the American flag will remain the best trained, the best prepared,
the best equipped fighting force in the world. And every one of you
should make that solemn pledge. We still have responsibilities around
the world. We are the world's only superpower. This is still a
dangerous and uncertain time, and we owe it to the people in uniform
to make sure that we adequately provide for the national defense and
for their interests and needs. Backed by an effective national
defense and a stronger economy, our Nation will be prepared to lead a
world challenged as it is everywhere by ethnic conflict, by the
proliferation of weapons of mass destruction, by the global
democratic revolution, and by challenges to the health of our global
environment.

I know this economic plan is ambitious, but I honestly believe it is
necessary for the continued greatness of the United States. And I
think it is paid for fairly, first by cutting Government, then by
asking the most of those who benefited the most in the past, and by
asking more Americans to contribute today so that all of us can
prosper tomorrow.

For the wealthiest, those earning more than $180,000 per year, I ask
you all who are listening tonight to support a raise in the top rate
for Federal income taxes from 31 to 36 percent. We recommend a 10
percent surtax on incomes over $250,000 a year, and we recommend
closing some loopholes that let some people get away without paying
any tax at all.

For businesses with taxable incomes in excess of $10 million, we
recommend a raise in the corporate tax rate, also to 36 percent, as
well as a cut in the deduction for business entertainment expenses.
Our plan seeks to attack tax subsidies that actually reward companies
more for shutting their operations down here and moving them overseas
than for staying here and reinvesting in America. I say that as
someone who believes that American companies should be free to invest
around the world and as a former Governor who actively sought
investment of foreign companies in my State. But the Tax Code should
not express a preference to American companies for moving somewhere
else, and it does in particular cases today.

We will seek to ensure that, through effective tax enforcement,
foreign corporations who do make money in America simply pay the same
taxes that American companies make on the same income.

To middle class Americans who have paid a great deal for the last 12
years and from whom I ask a contribution tonight, I will say again as
I did on Monday night: You're not going alone any more, you're
certainly not going first, and you're not going to pay more for less
as you have too often in the past. I want to emphasize the facts
about this plan: 98.8 percent of America's families will have no
increase in their income tax rates, only 1.2 percent at the top.

Let me be clear: There will also be no new cuts in benefits for
Medicare. As we move toward the 4th year, with the explosion in
health care costs, as I said, projected to account for 50 percent of
the growth of the deficit between now and the year 2000, there must
be planned cuts in payments to providers, to doctors, to hospitals,
to labs, as a way of controlling health care costs. But I see these
only as a stopgap until we can reform the entire health care system.
If you'll help me do that, we can be fair to the providers and to the
consumers of health care. Let me repeat this, because I know it
matters to a lot of you on both sides of the aisle. This plan does
not make a recommendation for new cuts in Medicare benefits for any
beneficiary.

Secondly, the only change we are making in Social Security is one
that has already been publicized. The plan does ask older Americans
with higher incomes, who do not rely solely on Social Security to get
by, to contribute more. This plan will not affect the 80 percent of
Social Security recipients who do not pay taxes on Social Security
now. Those who do not pay tax on Social Security now will not be
affected by this plan.

Our plan does include a broad-based tax on energy, and I want to tell
you why I selected this and why I think it's a good idea. I recommend
that we adopt a Btu tax on the heat content of energy as the best way
to provide us with revenue to lower the deficit because it also
combats pollution, promotes energy efficiency, promotes the
independence, economically, of this country as well as helping to
reduce the debt, and because it does not discriminate against any
area. Unlike a carbon tax, that's not too hard on the coal States;
unlike a gas tax, that's not too tough on people who drive a long way
to work; unlike an ad valorem tax, it doesn't increase just when the
price of an energy source goes up. And it is environmentally
responsible. It will help us in the future as well as in the present
with the deficit.

Taken together, these measures will cost an American family with an
income of about $40,000 a year less than $17 a month. It will cost
American families with incomes under $30,000 nothing because of other
programs we propose, principally those raising the earned-income tax
credit.

Because of our publicly stated determination to reduce the deficit,
if we do these things, we will see the continuation of what's
happened just since the election. Just since the election, since the
Secretary of the Treasury, the Director of the Office of Management
and Budget, and others who have begun to speak out publicly in favor
of a tough deficit reduction plan, interest rates have continued to
fall long-term. That means that for the middle class who will pay
something more each month, if they had any credit needs or demands,
their increased energy costs will be more than offset by lower
interest costs for mortgages, consumer loans, credit cards. This can
be a wise investment for them and their country now.

I would also point out what the American people already know, and
that is, because we're a big, vast country where we drive long
distances, we have maintained far lower burdens on energy than any
other advanced country. We will still have far lower burdens on
energy than any other advanced country. And these will be spread
fairly, with real attempts to make sure that no cost is imposed on
families with incomes under $30,000 and that the costs are very
modest until you get into the higher income groups where the income
taxes trigger in.

Now, I ask all of you to consider this: Whatever you think of the tax
program, whatever you think of the spending cuts, consider the cost of
not changing. Remember the numbers that you all know. If we just keep
on doing what we're doing, by the end of the decade we'll have a
$650-billion-a-year deficit. If we just keep on doing what we're
doing, by the end of the decade 20 percent of our national income
will go to health care every year, twice as much as any other country
on the face of the globe. If we just keep on doing what we're doing,
over 20 cents on the dollar will have to go to service the debt.

Unless we have the courage now to start building our future and stop
borrowing from it, we're condemning ourselves to years of stagnation
interrupted by occasional recessions, to slow growth in jobs, to no
more growth in income, to more debt, to more disappointment. Worse,
unless we change, unless we increase investment and reduce the debt
to raise productivity so that we can generate both jobs and incomes,
we will be condemning our children and our children's children to a
lesser life than we enjoyed. Once Americans looked forward to
doubling their living standards every 25 years. At present
productivity rates, it will take 100 years to double living
standards, until our grandchildren's grandchildren are born. I say
that is too long to wait.

Tonight the American people know we have to change. But they're also
likely to ask me tomorrow and all of you for the weeks and months
ahead whether we have the fortitude to make the changes happen in the
right way. They know that as soon as I leave this Chamber and you go
home, various interest groups will be out in force lobbying against
this or that piece of this plan, and that the forces of conventional
wisdom will offer a thousand reasons why we well ought to do this but
we just can't do it.

Our people will be watching and wondering, not to see whether you
disagree with me on a particular issue but just to see whether this
is going to be business as usual or a real new day, whether we're all
going to conduct ourselves as if we know we're working for them. We
must scale the walls of the people's scepticisms, not with our words
but with our deeds. After so many years of gridlock and indecision,
after so many hopeful beginnings and so few promising results, the
American people are going to be harsh in their judgments of all of us
if we fail to seize this moment.

This economic plan can't please everybody. If the package is picked
apart, there will be something that will anger each of us, won't
please anybody. But if it is taken as a whole, it will help all of
us. So I ask you all to begin by resisting the temptation to focus
only on a particular spending cut you don't like or some particular
investment that wasn't made. And nobody likes the tax increases, but
let's just face facts. For 20 years, through administrations of both
parties, incomes have stalled and debt has exploded and productivity
has not grown as it should. We cannot deny the reality of our
condition. We have got to play the hand we were dealt and play it as
best we can.

My fellow Americans, the test of this plan cannot be "what is in it
for me." It has got to be "what is in it for us." If we work hard and
if we work together, if we rededicate ourselves to creating jobs, to
rewarding work, to strengthening our families, to reinventing our
Government, we can lift our country's fortunes again.

Tonight I ask everyone in this Chamber and every American to look
simply into your heart, to spark your own hopes, to fire your own
imagination. There is so much good, so much possibility, so much
excitement in this country now that if we act boldly and honestly, as
leaders should, our legacy will be one of prosperity and progress.
This must be America's new direction. Let us summon the courage to
seize it.