To the Congress of the United States:
The State of the Union is sound. Our economy is recovering from a
recession. A national energy plan is in place and our dependence on
foreign oil is decreasing. We have been at peace for four uninterrupted
years.
But, our Nation has serious problems. Inflation and unemployment are
unacceptably high. The world oil market is increasingly tight. There are
trouble spots throughout the world, and 52 American hostages are being
held in Iran against international law and against every precept of
human affairs.
However, I firmly believe that, as a result of the progress made in so
many domestic and international areas over the past four years, our
Nation is stronger, wealthier, more compassionate and freer than it was
four years ago. I am proud of that fact. And I believe the Congress
should be proud as well, for so much of what has been accomplished over
the past four years has been due to the hard work, insights and
cooperation of Congress. I applaud the Congress for its efforts and its
achievements.
In this State of the Union Message I want to recount the achievements
and progress of the last four years and to offer recommendations to the
Congress for this year. While my term as President will end before the
97th Congress begins its work in earnest, I hope that my recommendations
will serve as a guide for the direction this country should take so we
build on the record of the past four years.
RECORD OF PROGRESS
When I took office, our Nation faced a number of serious domestic and
international problems:
--no national energy policy existed, and our dependence on foreign oil
was rapidly increasing;
--public trust in the integrity and openness of the government was low;
--the Federal government was operating inefficiently in administering
essential programs and policies;
--major social problems were being ignored or poorly addressed by the
Federal government;
--our defense posture was declining as a result of a defense budget
which was continuously shrinking in real terms;
--the strength of the NATO Alliance needed to be bolstered;
--tensions between Israel and Egypt threatened another Middle East war;
and
--America’s resolve to oppose human rights violations was under serious
question.
Over the past 48 months, clear progress has been made in solving the
challenges we found in January of 1977:
--almost all of our comprehensive energy program have been enacted, and
the Department of Energy has been established to administer the program;
confidence in the government’s integrity has been restored, and respect
for the government’s openness and fairness has been renewed;
--the government has been made more effective and efficient: the Civil
Service system was completely reformed for the first time this century;
--14 reorganization initiatives have been proposed to the Congress,
approved, and implemented;
--two new Cabinet departments have been created to consolidate and
streamline the government’s handling of energy and education problems;
--inspectors general have been placed in each Cabinet department to
combat fraud, waste and other abuses;
--the regulatory process has been reformed through creation of the
Regulatory Council, implementation of Executive Order 12044 and its
requirement for cost-impact analyses, elimination of unnecessary
regulation, and passage of the Regulatory Flexibility Act;
--procedures have been established to assure citizen participation in
government;
--and the airline, trucking, rail and communications industries are
being deregulated;
--critical social problems, many long ignored by the Federal government,
have been addressed directly;
--an urban policy was developed and implemented to reverse the decline
in our urban areas;
--the Social Security System was refinanced to put it on a sound
financial basis;
--the Humphrey-Hawkins Full Employment Act was enacted;
--Federal assistance for education was expanded by more than 75 percent;
--the minimum wage was increased to levels needed to ease the effects of
inflation;
--affirmative action has been pursued aggressively; more blacks,
Hispanics and women have been appointed to senior government positions
and to judgeships than at any other time in our history;
--the ERA ratification deadline was extended to aid the ratification
effort;
--and minority business procurement by the Federal government has more
than doubled;
--the Nation’s first sectoral policies were put in place, for the auto
and steel industries, with my Administration demonstrating the value of
cooperation between the government, business and labor;
--reversing previous trends, real defense spending has increased every
year since 1977;
--the real increase in FY 1980 defense spending is well above 3 percent
and I expect FY 1981 defense spending to be even higher;
--looking ahead, the defense program I am proposing is premised on a
real increase in defense spending over the next five years of 20 percent
or more;
--the NATO Alliance has proven its unity in responding to the situations
in Eastern Europe and Southwest Asia and in agreeing on the issues to be
addressed in the review of the Helsinki Final Act currently underway in
Madrid;
--the peace process in the Middle East established at Camp David and by
the Peace Treaty between Egypt and Israel is being buttressed on two
fronts: steady progress in the normalization of Egyptian-Israeli
relations in many fields, and the commitment of both Egypt and Israel,
with United States’ assistance, to see through to successful conclusion
the autonomy negotiations for the West Bank and Gaza;
--the Panama Canal Treaties have been put into effect, which has helped
to improve relations with Latin America;
--we have continued this Nation’s strong commitment to the pursuit of
human rights throughout the world, evenhandedly and objectively;
--our commitment to a worldwide human rights policy has remained firm;
--and many other countries have given high priority to it;
--our resolve to oppose aggression, such as the illegal invasion of the
Soviet Union into Afghanistan, has been supported by tough action.
I. ENSURING ECONOMIC STRENGTH ECONOMY
During the last decade our Nation has withstood a series of economic
shocks unprecedented in peacetime. The most dramatic of these has been
the explosive increases of OPEC oil prices. But we have also faced world
commodity shortages, natural disasters, agricultural shortages and major
challenges to world peace and security. Our ability to deal with these
shocks has been impaired because of a decrease in the growth of
productivity and the persistence of underlying inflationary forces built
up over the past 15 years.
Nevertheless, the economy has proved to be remarkably resilient. Real
output has grown at an average rate of 3 percent per year since I took
office, and employment has grown by 10 percent. We have added about 8
million productive private sector jobs to the economy. However,
unacceptably high inflation--the most difficult economic problem I have
faced--persists.
This inflation--which threatens the growth, productivity, and stability
of our economy--requires that we restrain the growth of the budget to
the maximum extent consistent with national security and human
compassion. I have done so in my earlier budgets, and in my FY ’82
budget. However, while restraint is essential to any appropriate
economic policy, high inflation cannot be attributed solely to
government spending. The growth in budget outlays has been more the
result of economic factors than the cause of them.
We are now in the early stages of economic recovery following a short
recession. Typically, a post-recessionary period has been marked by
vigorous economic growth aided by anti-recessionary policy measures such
as large tax cuts or big, stimulation spending programs. I have declined
to recommend such actions to stimulate economic activity, because the
persistent inflationary pressures that beset our economy today dictate a
restrained fiscal policy.
Accordingly, I am asking the Congress to postpone until January 1, 1982,
the personal tax reductions I had earlier proposed to take effect on
January 1 of this year.
However, my 1982 budget proposes significant tax changes to increase the
sources of financing for business investment. While emphasizing the need
for continued fiscal restraint, this budget takes the first major step
in a long-term tax reduction program designed to increase capital
formation. The failure of our Nation’s capital stock to grow at a rate
that keeps pace with its labor force has clearly been one cause of our
productivity slowdown. Higher investment rates are also critically
needed to meet our Nation’s energy needs, and to replace
energy-inefficient plants and equipment with new energy-saving physical
plants. The level of investment that is called for will not occur in the
absence of policies to encourage it.
Therefore, my budget proposes a major liberalization of tax allowances
for depreciation, as well as simplified depreciation accounting,
increasing the allowable rates by about 40 percent. I am also proposing
improvements in the investment tax credit, making it refundable, to meet
the investment needs of firms with no current earnings.
These two proposals, along with carefully-phased tax reductions for
individuals, will improve both economic efficiency and tax equity. I
urge the Congress to enact legislation along the lines and timetable I
have proposed.
THE 1982 BUDGET
The FY 1982 budget I have sent to the Congress continues our four-year
policy of prudence and restraint. While the budget deficits during my
term are higher than I would have liked, their size is determined for
the most part by economic conditions. And in spite of these conditions,
the relative size of the deficit continues to decline. In 1976, before I
took office, the budget deficit equalled 4 percent of gross national
product. It had been cut to 2.3 percent in the 1980 fiscal year just
ended. My 1982 budget contains a deficit estimated to be less than 1
percent of our gross national product.
The rate of growth in Federal spending has been held to a minimum.
Nevertheless, outlays are still rising more rapidly than many had
anticipated, the result of many powerful forces in our society:
We face a threat to our security, as events in Afghanistan, the Middle
East, and Eastern Europe make clear. We have a steadily aging population
and, as a result, the biggest single increase in the Federal budget is
the rising cost of retirement programs, particularly social security. We
face other important domestic needs: to continue responsibility for the
disadvantaged; to provide the capital needed by our cities and our
transportation systems; to protect our environment; to revitalize
American industry; and to increase the export of American goods and
services so essential to the creation of jobs and a trade surplus.
Yet the Federal Government itself may not always be the proper source of
such assistance. For example, it must not usurp functions if they can be
more appropriately decided upon, managed, and financed by the private
sector or by State and local governments. My Administration has always
sought to consider the proper focus of responsibility for the most
efficient resolution of problems.
We have also recognized the need to simplify the system of grants to
State and local governments. I have again proposed several grant
consolidations in the 1982 budget, including a new proposal that would
consolidate several highway programs.
The pressures for growth in Federal use of national resources are great.
My Administration has initiated many new approaches to cope with these
pressures. We started a multi-year budget system, and we began a system
for controlling Federal credit programs. Yet in spite of increasing
needs to limit spending growth, we have consistently adhered to these
strong budget principles:
Our Nation’s armed forces must always stand sufficiently strong to deter
aggression and to assure our security. An effective national energy plan
is essential to increase domestic production of oil and gas, to
encourage conservation of our scarce energy resources, to stimulate
conversion to more abundant fuels, and to reduce our trade deficit. The
essential human needs for our citizens must be given the highest
priority. The Federal Government must lead the way in investment in the
Nation’s technological future. The Federal Government has an obligation
to nurture and protect our environment--the common resource, birthright,
and sustenance of the American people.
My 1982 budget continues to support these principles. It also proposes
responsible tax reductions to encourage a more productive economy, and
adequate funding of our highest priority programs within an overall
policy of constraint.
Fiscal restraint must be continued in the years ahead. Budgets must be
tight enough to convince those who set wages and prices that the Federal
Government is serious about fighting inflation but not so tight as to
choke off all growth.
Careful budget policy should be supplemented by other measures designed
to reduce inflation at lower cost in lost output and employment. These
other steps include measures to increase investment--such as the tax
proposals included in my 1982 budget--and measures to increase
competition and productivity in our economy. Voluntary incomes policies
can also directly influence wages and prices in the direction of
moderation and thereby bring inflation down faster and at lower cost to
the economy. Through a tax-based incomes policy (TIP) we could provide
tax incentives for firms and workers to moderate their wage and price
increases. In the coming years, control of Federal expenditures can make
possible periodic tax reductions. The Congress should therefore begin
now to evaluate the potentialities of a TIP program so that when the
next round of tax reductions is appropriate a TIP program will be
seriously considered.
EMPLOYMENT
During the last four years we have given top priority to meeting the
needs of workers and providing additional job opportunities to those who
seek work. Since the end of 1976:
Almost 9 million new jobs have been added to the nation’s economy total
employment has reached 97 million. More jobs than ever before are held
by women, minorities and young people. Employment over the past four
years has increased by: 17% for adult women 11% for blacks, and 30% for
Hispanics employment of black teenagers increased by more than 5%,
reversing the decline that occurred in the previous eight years.
Major initiatives launched by this Administration helped bring about
these accomplishments and have provided a solid foundation for
employment and training policy in the 1980’s. In 1977, as part of the
comprehensive economic stimulus program:
425,000 public service jobs were created A $1 billion youth employment
initiative funded 200,000 jobs the doubling of the Job Corps to 44,000
slots began and 1 million summer youth jobs were approved--a 25 percent
increase.
In 1978:
The Humphrey-Hawkins Full Employment Act became law the $400 million
Private Sector Initiatives Program was begun a targeted jobs tax credit
for disadvantaged youth and others with special employment barriers was
enacted the Comprehensive Employment and Training Act was reauthorized
for four years.
In 1979:
A $6 billion welfare reform proposal was introduced with funding for
400,000 public service jobs welfare reform demonstration projects were
launched in communities around the country the Vice President initiated
a nationwide review of youth unemployment in this country.
In 1980:
The findings of the Vice President’s Task Force revealed the major
education and employment deficits that exist for poor and minority
youngsters. As a result a $2 billion youth education and jobs initiative
was introduced to provide unemployed youth with the basic education and
work experience they need to compete in the labor market of the 1980’s.
As part of the economic revitalization program several steps were
proposed to aid workers in high unemployment communities:
An additional 13 weeks of unemployment benefits for the long term
unemployed. $600 million to train the disadvantaged and unemployed for
new private sector jobs. Positive adjustment demonstrations to aid
workers in declining industries. The important Title VII Private Sector
Initiatives Program was reauthorized for an additional two years.
In addition to making significant progress in helping the disadvantaged
and unemployed, important gains were realized for all workers:
An historic national accord with organized labor made it possible for
the views of working men and women to be heard as the nation’s economic
and domestic policies were formulated; the Mine Safety and Health Act
brought about improved working conditions for the nation’s 500,000
miners. substantial reforms of Occupational Safety and Health
Administration were accomplished to help reduce unnecessary burdens on
business and to focus on major health and safety problems; the minimum
wage was increased over a four year period from $2.30 to $3.35 an hour;
the Black Lung Benefit Reform Act was signed into law; attempts to
weaken Davis-Bacon Act were defeated.
While substantial gains have been made in the last four years, continued
efforts are required to ensure that this progress is continued:
Government must continue to make labor a full partner in the policy
decisions that affect the interests of working men and women; a broad,
bipartisan effort to combat youth unemployment must be sustained
compassionate reform of the nation’s welfare system should be continued
with employment opportunities provided for those able to work; workers
in declining industries should be provided new skills and help in
finding employment.
TRADE
Over the past year, the U.S. trade picture improved as a result of solid
export gains in both manufactured and agricultural products.
Agricultural exports reached a new record of over $40 billion, while
manufactured exports have grown by 24 percent to a record $144 billion.
In these areas the United States recorded significant surpluses of $24
billion and $19 billion respectively. While our oil imports remained a
major drain on our foreign exchange earnings, that drain was somewhat
moderated by a 19 percent decline in the volume of oil imports.
U.S. trade negotiators made significant progress over the past year in
assuring effective implementation of the agreements negotiated during
the Tokyo Round of Multilateral Trade Negotiations. Agreements reached
with the Japanese government, for example, will assure that the United
States will be able to expand its exports to the Japanese market in such
key areas as telecommunications equipment, tobacco, and lumber. Efforts
by U.S. trade negotiators also helped to persuade a number of key
developing countries to accept many of the non-tariff codes negotiated
during the Multilateral Trade Negotiations. This will assure that these
countries will increasingly assume obligations under the international
trading system.
A difficult world economic environment posed a challenge for the
management of trade relations. U.S. trade negotiators were called upon
to manage serious sectoral problems in such areas as steel, and helped
to assure that U.S. chemical exports will have continued access to the
European market.
Close consultations with the private sector in the United States have
enabled U.S. trade negotiators to pinpoint obstacles to U.S. trade in
services, and to build a basis for future negotiations. Services have
been an increasingly important source of export earnings for the United
States, and the United States must assure continued and increased access
to foreign markets.
The trade position of the United States has improved. But vigorous
efforts are needed in a number of areas to assure continued market
access for U.S. exports, particularly agricultural and high technology
products, in which the United States continues to have a strong
competitive edge. Continued efforts are also needed to remove many
domestic disincentives, which now hamper U.S. export growth. And we must
ensure that countries do not manipulate investment, or impose investment
performance requirements which distort trade and cost us jobs in this
country.
In short, we must continue to seek free--but fair--trade. That is the
policy my Administration has pursued from the beginning, even in areas
where foreign competition has clearly affected our domestic industry. In
the steel industry, for instance, we have put Trigger Price Mechanism
into place to help prevent the dumping of steel. That action has
strengthened the domestic steel industry. In the automobile industry, we
have worked-- without resort to import quotas--to strengthen the
industry’s ability to modernize and compete effectively.
SMALL BUSINESS
I have often said that there is nothing small about small business in
America. These firms account for nearly one-half our gross national
product; over half of new technology; and much more than half of the
jobs created by industry.
Because this sector of the economy is the very lifeblood of our National
economy, we have done much together to improve the competitive climate
for smaller firms. These concerted efforts have been an integral part of
my program to revitalize the economy.
They include my campaign to shrink substantially the cash and time
consuming red tape burden imposed on business. They include my
personally-directed policy of ambitiously increasing the Federal
contracting dollars going to small firms, especially those owned by
women and minorities. And they include my proposals to reinvigorate
existing small businesses and assist the creation of new ones through
tax reform; financing assistance; market expansion; and support of
product innovation.
Many of my initiatives to facilitate the creation and growth of small
businesses were made in response to the White House Conference on Small
Business, which I convened. My Administration began the implementation
of most of the ideas produced last year by that citizen’s advisory body;
others need to be addressed. I have proposed the reconvening of the
Conference next year to review progress; reassess priorities; and set
new goals. In the interim I hope that the incoming Administration and
the new Congress will work with the committee I have established to keep
these business development ideas alive and help implement Conference
recommendations.
MINORITY BUSINESS
One of the most successful developments of my Administration has been
the growth and strengthening of minority business. This is the first
Administration to put the issue on the policy agenda as a matter of
major importance. To implement the results of our early efforts in this
field I submitted legislation to Congress designed to further the
development of minority business.
We have reorganized the Office of Minority Business into the Minority
Business Development Administration in the Department of Commerce. MBDA
has already proven to be a major factor in assisting minority businesses
to achieve equitable competitive positions in the marketplace.
The Federal government’s procurement from minority-owned firms has
nearly tripled since I took office. Federal deposits in minority-owned
banks have more than doubled and minority ownership of radio and
television stations has nearly doubled. The SBA administered 8(a) Pilot
Program for procurement with the Army proved to be successful and I
recently expanded the number of agencies involved to include NASA and
the Departments of Energy and Transportation.
I firmly believe the critical path to full freedom and equality for
America’s minorities rests with the ability of minority communities to
participate competitively in the free enterprise system. I believe the
government has a fundamental responsibility to assist in the development
of minority business and I hope the progress made in the last four years
will continue.
II. CREATING ENERGY SECURITY
Since I took office, my highest legislative priorities have involved the
reorientation and redirection of U.S. energy activities and for the
first time, to establish a coordinated national energy policy. The
struggle to achieve that policy has been long and difficult, but the
accomplishments of the past four years make clear that our country is
finally serious about the problems caused by our overdependence on
foreign oil. Our progress should not be lost. We must rely on and
encourage multiple forms of energy production--coal, crude oil, natural
gas, solar, nuclear, synthetics--and energy conservation. The framework
put in place over the last four years will enable us to do this.
NATIONAL ENERGY POLICY
As a result of actions my Administration and the Congress have taken
over the past four years, our country finally has a national energy
policy:
Under my program of phased decontrol, domestic crude oil price controls
will end September 30, 1981. As a result exploratory drilling activities
have reached an all-time high; Prices for new natural gas are being
decontrolled under the Natural Gas Policy Act--and natural gas
production is now at an all time high; the supply shortages of several
years ago have been eliminated; The windfall profits tax on crude oil
has been enacted providing $227 billion over ten years for assistance to
low-income households, increased mass transit funding, and a massive
investment in the production and development of alternative energy
sources; The Synthetic Fuels Corporation has been established to help
private companies build the facilities to produce energy from synthetic
fuels; Solar energy funding has been quadrupled, solar energy tax
credits enacted, and a Solar Energy and Energy Conservation Bank has
been established; A route has been chosen to bring natural gas from the
North Slope of Alaska to the lower 48 states; Coal production and
consumption incentives have been increased, and coal production is now
at its highest level in history; A gasoline rationing plan has been
approved by Congress for possible use in the event of a severe energy
supply shortage or interruption; Gasohol production has been
dramatically increased, with a program being put in place to produce 500
million gallons of alcohol fuel by the end of this year--an amount that
could enable gasohol to meet the demand for 10 percent of all unleaded
gasoline; New energy conservation incentives have been provided for
individuals, businesses and communities and conservation has increased
dramatically. The U.S. has reduced oil imports by 25 percent--or 2
million barrels per day--over the past four years.
INCREASED DEVELOPMENT OF DOMESTIC ENERGY SOURCES
Although it is essential that the Nation reduce its dependence on
imported fossil fuels and complete the transition to reliance on
domestic renewable sources of energy, it is also important that this
transition be accomplished in an orderly, economic, and environmentally
sound manner. To this end, the Administration has launched several
initiatives.
Leasing of oil and natural gas on federal lands, particularly the outer
continental shelf, has been accelerated at the same time as the
Administration has reformed leasing procedures through the 1978
amendments to the Outer Continental Shelf Lands Act. In 1979 the
Interior Department held six OCS lease sales, the greatest number ever,
which resulted in federal receipts of $6.5 billion, another record. The
five-year OCS Leasing schedule was completed, requiring 36 sales over
the next five years.
Since 1971 no general federal coal lease sales were suspended. Over the
past four years the Administration has completely revised the federal
coal leasing program to bring it into compliance with the requirements
of 1976 Federal Land Planning and Management Act and other statutory
provisions. The program is designed to balance the competing interests
that affect resource development on public lands and to ensure that
adequate supplies of coal will be available to meet national needs. As a
result, the first general competitive federal coal lease sale in ten
years will be held this month.
In July 1980, I signed into law the Energy Security Act of 1980 which
established the Synthetic Fuels Corporation. The Corporation is designed
to spur the development of commercial technologies for production of
synthetic fuels, such as liquid and gaseous fuels from coal and the
production of oil from oil shale. The Act provides the Corporation with
an initial $22 billion to accomplish these objectives. The principal
purpose of the legislation is to ensure that the nation will have
available in the late 1980’s the option to undertake commercial
development of synthetic fuels if that becomes necessary. The Energy
Security Act also provides significant incentives for the development of
gasohol and biomass fuels, thereby enhancing the nation’s supply of
alternative energy sources.
COMMITMENT TO A SUSTAINABLE ENERGY FUTURE
The Administration’s 1977 National Energy Plan marked an historic
departure from the policies of previous Administrations. The plan
stressed the importance of both energy production and conservation to
achieving our ultimate national goal of relying primarily on secure
sources of energy. The National Energy Plan made energy conservation a
cornerstone of our national energy policy.
In 1978, I initiated the Administration’s Solar Domestic Policy Review.
This represented the first step towards widespread introduction of
renewable energy sources into the Nation’s economy. As a result of the
Review, I issued the 1979 Solar Message to Congress, the first such
message in the Nation’s history. The Message outlined the
Administration’s solar program and established an ambitious national
goal for the year 2000 of obtaining 20 percent of this Nation’s energy
from solar and renewable sources. The thrust of the federal solar
program is to help industry develop solar energy sources by emphasizing
basic research and development of solar technologies which are not
currently economic, such as photovoltaics, which generate energy
directly from the sun. At the same time, through tax incentives,
education, and the Solar Energy and Energy Conservation Bank, the solar
program seeks to encourage state and local governments, industry, and
our citizens to expand their use of solar and renewable resource
technologies currently available.
As a result of these policies and programs, the energy efficiency of the
American economy has improved markedly and investments in renewable
energy sources have grown significantly. It now takes 3 1/2 percent less
energy to produce a constant dollar of GNP than it did in January 1977.
This increase in efficiency represents a savings of over 1.3 million
barrels per day of oil equivalent, about the level of total oil
production now occurring in Alaska. Over the same period, Federal
support for conservation and solar energy has increased by more than
3000 percent, to $3.3 billion in FY 1981, including the tax credits for
solar energy and energy conservation investments--these credits are
expected to amount to $1.2 billion in FY 1981 and $1.5 billion in FY
1982.
COMMITMENT TO NUCLEAR SAFETY AND SECURITY
Since January 1977, significant progress has been achieved in resolving
three critical problems resulting from the use of nuclear energy:
radioactive waste management, nuclear safety and weapons proliferation.
In 1977, the Administration announced its nuclear nonproliferation
policy and initiated the International Fuel Cycle Evaluation. In 1978,
Congress passed the Nuclear Nonproliferation Act, an historic piece of
legislation.
In February 1980, the Administration transmitted its nuclear waste
management policy to the Congress. This policy was a major advance over
all previous efforts. The principal aspects of that policy are:
acknowledging the seriousness of the problem and the numerous technical
and institutional issues; adopting a technically and environmentally
conservative approach to the first permanent repository; and providing
the states with significant involvement in nuclear waste disposal
decisions by creating the State Planning Council. While much of the plan
can be and is being implemented administratively, some new authorities
are needed. The Congress should give early priority to enacting
provisions for away-from-reactor storage and the State Planning Council.
The accident at Three Mile Island made the nation acutely aware of the
safety risks posed by nuclear power plants. In response, the President
established the Kemeny Commission to review the accident and make
recommendations. Virtually all of the Commission’s substantive
recommendations were adopted by the Administration and are now being
implemented by the Nuclear Regulatory Commission. The Congress adopted
the President’s proposed plan for the Nuclear Regulatory Commission and
the Nuclear Safety Oversight Committee was established to ensure that
the Administration’s decisions were implemented.
Nuclear safety will remain a vital concern in the years ahead. We must
continue to press ahead for the safe, secure disposal of radioactive
wastes, and prevention of nuclear proliferation.
While significant growth in foreign demand for U.S. steam coal is
foreseen, congestion must be removed at major U.S. coal exporting ports
such as Hampton Roads, Virginia, and Baltimore, Maryland. My
Administration has worked through the Interagency Coal Task Force Study
to promote cooperation and coordination of resources between shippers,
railroads, vessel broker/ operators and port operators, and to determine
the most appropriate Federal role in expanding and modernizing coal
export facilities, including dredging deeper channels at selected ports.
As a result of the Task Force’s efforts, administrative steps have been
taken by the Corps of Engineers to reduce significantly the amount of
time required for planning and economic review of port dredging
proposals. The Administration has also recommended that the Congress
enact legislation to give the President generic authority to recommend
appropriations for channel dredging activities. Private industry will,
of course, play the major role in developing the United States’ coal
export facilities, but the government must continue to work to
facilitate transportation to foreign markets.
III. ENHANCING BASIC HUMAN AND SOCIAL NEEDS
For too long prior to my Administration, many of our Nation’s basic
human and social needs were being ignored or handled insensitively by
the Federal government. Over the last four years, we have significantly
increased funding for many of the vital programs in these areas;
developed new programs where needs were unaddressed; targeted Federal
support to those individuals and areas most in need of our assistance;
and removed barriers that have unnecessarily kept many disadvantaged
citizens from obtaining aid for their most basic needs.
Our record has produced clear progress in the effort to solve some of
the country’s fundamental human and social problems. My Administration
and the Congress, working together, have demonstrated that government
must and can meet our citizens’ basic human and social needs in a
responsible and compassionate way.
But there is an unfinished agenda still before the Congress. If we are
to meet our obligations to help all Americans realize the dreams of
sound health care, decent housing, effective social services, a good
education, and a meaningful job, important legislation still must be
enacted. National Health Insurance, Welfare Reform, Child Health
Assessment Program, are before the Congress and I urge their passage.
HEALTH NATIONAL HEALTH PLAN
During my Administration, I proposed to Congress a National Health Plan
which will enable the country to reach the goal of comprehensive,
universal health care coverage. The legislation I submitted lays the
foundation for this comprehensive plan and addresses the most serious
problems of health financing and delivery. It is realistic and
enactable. It does not overpromise or overspend, and, as a result, can
be the solution to the thirty years of Congressional battles on national
health insurance. My Plan includes the following key features:
Nearly 15 million additional poor would receive fully-subsidized
comprehensive coverage; pre-natal and delivery services are provided for
all pregnant women and coverage is provided for all acute care for
infants in their first year of life; the elderly and disabled would have
a limit of $1,250 placed on annual out-of-pocket medical expenses and
would no longer face limits on hospital coverage; all full-time
employees and their families would receive insurance against at least
major medical expenses under mandated employer coverage; Medicare and
Medicaid would be combined and expanded into an umbrella Federal
program, Healthcare, for increased program efficiency, accountability
and uniformity; and strong cost controls and health system reforms would
be implemented, including greater incentives for Health Maintenance
Organizations.
I urge the new Congress to compare my Plan with the
alternatives--programs which either do too little to improve the health
care needs of Americans most in need or programs which would impose
substantial financial burdens on the American taxpayers. I hope the
Congress will see the need for and the benefits of my Plan and work
toward prompt enactment. We cannot afford further delay in this vital
area.
HEALTH CARE COST CONTROL
Inflation in health care costs remains unacceptably high. Throughout my
Administration, legislation to reduce health care cost inflation was one
of my highest priorities, but was not passed by the Congress. Therefore,
my FY 1982 budget proposes sharing the responsibility for health care
cost control with the private sector, through voluntary hospital cost
guidelines and intensified monitoring. In the longer term, the health
care reimbursement system must be reformed. We must move away from
inflationary cost-based reimbursement and fee-for-service, and toward a
system of prospective reimbursement, under which health care providers
would operate within predetermined budgets. This reimbursement reform is
essential to ultimately control inflation in health care costs, and will
be a significant challenge to the new Congress.
HEALTH PROMOTION AND DISEASE PREVENTION
During my Administration, the Surgeon General released “Healthy People,”
a landmark report on health promotion and disease prevention. The report
signals the growing consensus that the Nation’s health strategy must be
refocused in the 1980’s to emphasize the prevention of disease.
Specifically, the report lays out measurable and achieveable goals in
the reduction of mortality which can be reached by 1990.
I urge the new Congress to endorse the principles of “Healthy People,”
and to adopt the recommendations to achieve its goals. This will
necessitate adoption of a broader concept of health care, to include
such areas as environmental health, workplace health and safety,
commercial product safety, traffic safety, and health education,
promotion and information.
MATERNAL AND CHILD HEALTH
Ensuring a healthy start in life for children remains not only a high
priority of my Administration, but also one of the most cost effective
forms of health care.
When I took office, immunization levels for preventable childhood
diseases had fallen to 70%. As a result of a concerted nationwide effort
during my Administration, I am pleased to report that now at least 90%
of children under 15, and virtually all school-age children are
immunized. In addition, reported cases of measles and mumps are at their
lowest levels ever.
Under the National Health Plan I have proposed, there would be no
cost-sharing for prenatal and delivery services for all pregnant women
and for acute care provided to infants in their first year of life.
These preventive services have extremely high returns in terms of
improved newborn and long-term child health.
Under the Child Health Assurance Program (CHAP) legislation which I
submitted to the Congress, and which passed the House, an additional two
million low-income children under 18 would become eligible for Medicaid
benefits, which would include special health assessments. CHAP would
also improve the continuity of care for the nearly 14 million children
now eligible for Medicaid. An additional 100,000 low-income pregnant
women would become eligible for prenatal care under the proposal. I
strongly urge the new Congress to enact CHAP and thereby provide
millions of needy children with essential health services. The
legislation has had strong bipartisan support, which should continue as
the details of the bill are completed.
I also urge the new Congress to provide strong support for two highly
successful ongoing programs: the special supplemental food program for
women, infants and children (WIC) and Family Planning. The food
supplements under WIC have been shown to effectively prevent ill health
and thereby reduce later medical costs. The Family Planning program has
been effective at reducing unwanted pregnancies among low-income women
and adolescents.
EXPANSION OF SERVICES TO THE POOR AND UNDERSERVED
During my Administration, health services to the poor and underserved
have been dramatically increased. The number of National Health Service
Corps (NHSC) assignees providing services in medically underserved
communities has grown from 500 in 1977 to nearly 3,000 in 1981. The
population served by the NHSC has more than tripled since 1977. The
number of Community Health Centers providing services in high priority
underserved areas has doubled during my Administration, and will serve
an estimated six million people in 1981. I strongly urge the new
Congress to support these highly successful programs.
MENTAL HEALTH
One of the most significant health achievements during my Administration
was the recent passage of the Mental Health Systems Act, which grew out
of recommendations of my Commission on Mental Health. I join many others
in my gratitude to the First Lady for her tireless and effective
contribution to the passage of this important legislation.
The Act is designed to inaugurate a new era of Federal and State
partnership in the planning and provision of mental health services. In
addition, the Act specifically provides for prevention and support
services to the chronically mentally ill to prevent unnecessary
institutionalization and for the development of community-based mental
health services. I urge the new Congress to provide adequate support for
the full and timely implementation of this Act.
HEALTH PROTECTION
With my active support, the Congress recently passed “Medigap”
legislation, which provides for voluntary certification of health
insurance policies supplemental to Medicare, to curb widespread abuses
in this area.
In the area of toxic agent control, legislation which I submitted to the
Congress recently passed. This will provide for a “super-fund” to cover
hazardous waste cleanup costs.
In the area of accidental injury control, we have established automobile
safety standards and increased enforcement activities with respect to
the 55 MPH speed limit. By the end of the decade these actions are
expected to save over 13,000 lives and 100,000 serious injuries each
year.
I urge the new Congress to continue strong support for all these
activities.
FOOD AND NUTRITION
Building on the comprehensive reform of the Food Stamp Program that I
proposed and Congress passed in 1977, my Administration and the Congress
worked together in 1979 and 1980 to enact several other important
changes in the Program. These changes will further simplify
administration and reduce fraud and error, will make the program more
responsive to the needs of the elderly and disabled, and will increase
the cap on allowable program expenditures. The Food Stamp Act will
expire at the end of fiscal 1981. It is essential that the new
Administration and the Congress continue this program to ensure complete
eradication of the debilitating malnutrition witnessed and documented
among thousands of children in the 1960’s.
DRUG ABUSE PREVENTION
At the beginning of my Administration there were over a half million
heroin addicts in the United States. Our continued emphasis on reducing
the supply of heroin, as well as providing treatment and rehabilitation
to its victims, has reduced the heroin addict population, reduced the
number of heroin overdose deaths by 80%, and reduced the number of
heroin related injuries by 50%. We have also seen and encouraged a
national movement of parents and citizens committed to reversing the
very serious and disturbing trends of adolescent drug abuse.
Drug abuse in many forms will continue to detract, however, from the
quality of life of many Americans. To prevent that, I see four great
challenges in the years ahead. First, we must deal aggressively with the
supplies of illegal drugs at their source, through joint crop
destruction programs with foreign nations and increased law enforcement
and border interdiction. Second, we must look to citizens and parents
across the country to help educate the increasing numbers of American
youth who are experimenting with drugs to the dangers of drug abuse.
Education is a key factor in reducing drug abuse. Third, we must focus
our efforts on drug and alcohol abuse in the workplace for not only does
this abuse contribute to low productivity but it also destroys the
satisfaction and sense of purpose all Americans can gain from the work
experience. Fourth, we need a change in attitude, from an attitude which
condones the casual use of drugs to one that recognizes the appropriate
use of drugs for medical purposes and condemns the inappropriate and
harmful abuse of drugs. I hope the Congress and the new Administration
will take action to meet each of these challenges.
EDUCATION
The American people have always recognized that education is one of the
soundest investments they can make. The dividends are reflected in every
dimension of our national life--from the strength of our economy and
national security to the vitality of our music, art, and literature.
Among the accomplishments that have given me the most satisfaction over
the last four years are the contributions that my Administration has
been able to make to the well-being of students and educators throughout
the country.
This Administration has collaborated successfully with the Congress on
landmark education legislation. Working with the Congressional
leadership, my Administration spotlighted the importance of education by
creating a new Department of Education. The Department has given
education a stronger voice at the Federal level, while at the same time
reserving the actual control and operation of education to states,
localities, and private institutions. The Department has successfully
combined nearly 150 Federal education programs into a cohesive,
streamlined organization that is more responsive to the needs of
educators and students. The Department has made strides to cut red tape
and paperwork and thereby to make the flow of Federal dollars to school
districts and institutions of higher education more efficient. It is
crucial that the Department be kept intact and strengthened.
Our collaboration with the Congress has resulted in numerous other
important legislative accomplishments for education. A little over two
years ago, I signed into law on the same day two major bills--one
benefiting elementary and secondary education and the other,
postsecondary education. The Education Amendments of 1978 embodied
nearly all of my Administration’s proposals for improvements in the
Elementary and Secondary Education Act, including important new programs
to improve students’ achievement in the basic skills and to aid school
districts with exceptionally high concentrations of children from
low-income families. The Middle Income Student Assistance Act,
legislation jointly sponsored by this Administration and the
Congressional leadership, expanded eligibility for need-based Basic
Educational Opportunity Grants to approximately one-third of the
students enrolled in post-secondary education and made many more
students eligible for the first time for other types of grants,
work-study, and loans.
Just three and a half months ago, my Administration and the Congress
successfully concluded over two years of work on a major reauthorization
bill that further expands benefits to postsecondary education. Reflected
in the Education Amendments of 1980 are major Administration
recommendations for improvements in the Higher Education Act--including
proposals for better loan access for students; a new parent loan
program; simplified application procedures for student financial aid; a
strengthened Federal commitment to developing colleges, particularly the
historically Black institutions; a new authorization for equipment and
facilities modernization funding for the nation’s major research
universities; and revitalized international education programs.
Supplementing these legislative accomplishments have been important
administrative actions aimed at reducing paperwork and simplifying
regulations associated with Federal education programs. We also launched
major initiatives to reduce the backlog of defaulted student loans and
otherwise to curb fraud, abuse, and waste in education programs.
To insure that the education enterprise is ready to meet the scientific
and technological changes of the future, we undertook a major study of
the status of science and engineering education throughout the nation. I
hope that the findings from this report will serve as a springboard for
needed reforms at all levels of education.
I am proud that this Administration has been able to provide the
financial means to realize many of our legislative and administrative
goals. Compared to the previous administration’s last budget, I have
requested the largest overall increase in Federal funding for education
in our nation’s history. My budget requests have been particularly
sensitive to the needs of special populations like minorities, women,
the educationally and economically disadvantaged, the handicapped, and
students with limited English-speaking ability. At the same time, I have
requested significant increases for many programs designed to enhance
the quality of American education, including programs relating to
important areas as diverse as international education, research
libraries, museums, and teacher centers.
Last year, I proposed to the Congress a major legislative initiative
that would direct $2 billion into education and job training programs
designed to alleviate youth unemployment through improved linkages
between the schools and the work place. This legislation generated
bipartisan support; but unfortunately, action on it was not completed in
the final, rushed days of the 96th Congress. I urge the new Congress--as
it undertakes broad efforts to strengthen the economy as well as more
specific tasks like reauthorizing the Vocational Education Act--to make
the needs of our nation’s unemployed youth a top priority for action.
Only by combining a basic skills education program together with work
training and employment incentives can we make substantial progress in
eliminating one of the most severe social problems in our nation--youth
unemployment, particularly among minorities. I am proud of the progress
already made through passage of the Youth Employment and Demonstration
Project Act of 1977 and the substantial increase in our investment in
youth employment programs. The new legislation would cap these efforts.
INCOME SECURITY SOCIAL SECURITY
One of the highest priorities of my Administration has been to continue
the tradition of effectiveness and efficiency widely associated with the
social security program, and to assure present and future beneficiaries
that they will receive their benefits as expected. The earned benefits
that are paid monthly to retired and disabled American workers and their
families provide a significant measure of economic protection to
millions of people who might otherwise face retirement or possible
disability with fear. I have enacted changes to improve the benefits of
many social security beneficiaries during my years as President.
The last four years have presented a special set of concerns over the
financial stability of the social security system. Shortly after taking
office I proposed and Congress enacted legislation to protect the
stability of the old age and survivors trust fund and prevent the
imminent exhaustion of the disability insurance trust fund, and to
correct a flaw in the benefit formula that was threatening the long run
health of the entire social security system. The actions taken by the
Congress at my request helped stabilize the system. That legislation was
later complemented by the Disability Insurance Amendments of 1980 which
further bolstered the disability insurance program, and reduced certain
inequities among beneficiaries.
My commitment to the essential retirement and disability protection
provided to 35 million people each month has been demonstrated by the
fact that without interruption those beneficiaries have continued to
receive their social security benefits, including annual cost of living
increases. Changing and unpredictable economic circumstances require
that we continue to monitor the financial stability of the social
security system. To correct anticipated short-term strains on the
system, I proposed last year that the three funds be allowed to borrow
from one another, and I urge the Congress again this year to adopt such
interfund borrowing. To further strengthen the social security system
and provide a greater degree of assurance to beneficiaries, given
projected future economic uncertainties, additional action should be
taken. Among the additional financing options available are borrowing
from the general fund, financing half of the hospital insurance fund
with general revenues, and increasing the payroll tax rate. The latter
option is particularly unpalatable given the significant increase in the
tax rate already mandated in law.
This Administration continues to oppose cuts in basic social security
benefits and taxing social security benefits. The Administration
continues to support annual indexing of social security benefits.
WELFARE REFORM
In 1979 I proposed a welfare reform package which offers solutions to
some of the most urgent problems in our welfare system. This proposal is
embodied in two bills, The Work and Training Opportunities Act and The
Social Welfare Reform Amendments Act. The House passed the second of
these two proposals. Within the framework of our present welfare system,
my reform proposals offer achievable means to increase self-sufficiency
through work rather than welfare, more adequate assistance to people
unable to work, the removal of inequities in coverage under current
programs, and fiscal relief needed by States and localities.
Our current welfare system is long overdue for serious reform; the
system is wasteful and not fully effective. The legislation I have
proposed will help eliminate inequities by establishing a national
minimum benefit, and by directly relating benefit levels to the poverty
threshold. It will reduce program complexity, which leads to
inefficiency and waste, by simplifying and coordinating administration
among different programs.
I urge the Congress to take action in this area along the lines I have
recommended.
CHILD WELFARE
My Administration has worked closely with the Congress on legislation
which is designed to improve greatly the child welfare services and
foster care programs and to create a Federal system of adoption
assistance. These improvements will be achieved with the recent
enactment of H.R. 3434, the Adoption Assistance and Child Welfare Act of
1980. The well-being of children in need of homes and their permanent
placement have been a primary concern of my Administration. This
legislation will ensure that children are not lost in the foster care
system, but instead will be returned to their families where possible or
placed in permanent adoptive homes.
LOW-INCOME ENERGY ASSISTANCE
In 1979 I proposed a program to provide an annual total of $1.6 billion
to low-income households which are hardest hit by rising energy bills.
With the cooperation of Congress, we were able to move quickly to
provide assistance to eligible households in time to meet their winter
heating bills.
In response to the extreme heat conditions affecting many parts of the
country during 1980, I directed the Community Services Administration to
make available over $27 million to assist low-income individuals,
especially the elderly, facing life threatening circumstances due to
extreme heat.
Congress amended and reauthorized the low-income energy assistance
program for fiscal year 1981, and provided $1.85 billion to meet
anticipated increasing need. The need for a program to help low-income
households with rising energy expenses will not abate in the near
future. The low-income energy assistance program should be reauthorized
to meet those needs.
HOUSING
For the past 14 months, high interest rates have had a severe impact on
the nation’s housing market. Yet the current pressures and uncertainties
should not obscure the achievements of the past four years.
Working with the Congress, the regulatory agencies, and the financial
community, my Administration has brought about an expanded and steadier
flow of funds into home mortgages. Deregulation of the interest rates
payable by depository institutions, the evolution of variable and
renegotiated rate mortgages, development of high yielding savings
certificates, and expansion of the secondary mortgage market have all
increased housing’s ability to attract capital and have assured that
mortgage money would not be cut off when interest rates rose. These
actions will diminish the cyclicality of the housing industry. Further,
we have secured legislation updating the Federal Government’s emergency
authority to provide support for the housing industry through the
Brooke-Cranston program, and creating a new Section 235 housing stimulus
program. These tools will enable the Federal Government to deal quickly
and effectively with serious distress in this critical industry.
We have also worked to expand homeownership opportunities for Americans.
By using innovative financing mechanisms, such as the graduated payment
mortgage, we have increased the access of middle income families to
housing credit. By revitalizing the Section 235 program, we have enabled
nearly 100,000 moderate income households to purchase new homes. By
reducing paperwork and regulation in Federal programs, and by working
with State and local governments to ease the regulatory burden, we have
helped to hold down housing costs and produce affordable housing.
As a result of these governmentwide efforts, 5 1/2 million more American
families bought homes in the past four years than in any equivalent
period in history. And more than 7 million homes have begun construction
during my Administration, 1 million more than in the previous four
years.
We have devoted particular effort to meeting the housing needs of low
and moderate income families. In the past four years, more than 1
million subsidized units have been made available for occupancy by lower
income Americans and more than 600,000 assisted units have gone into
construction. In addition, we have undertaken a series of measures to
revitalize and preserve the nation’s 2 million units of public and
assisted housing.
For Fiscal Year 1982, I am proposing to continue our commitment to lower
income housing. I am requesting funds to support 260,000 units of
Section 8 and public housing, maintaining these programs at the level
provided by Congress in Fiscal 1981.
While we have made progress in the past four years, in the future there
are reasons for concern. Home price inflation and high interest rates
threaten to put homeownership out of reach for first-time homebuyers.
Lower income households, the elderly and those dependent upon rental
housing face rising rents, low levels of rental housing construction by
historic standards, and the threat of displacement due to conversion to
condominiums and other factors. Housing will face strong competition for
investment capital from the industrial sector generally and the energy
industries, in particular.
To address these issues, I appointed a Presidential Task Force and
Advisory Group last October. While this effort will not proceed due to
the election result, I hope the incoming Administration will proceed
with a similar venture.
The most important action government can take to meet America’s housing
needs is to restore stability to the economy and bring down the rate of
inflation. Inflation has driven up home prices, operating costs and
interest rates. Market uncertainty about inflation has contributed to
the instability in interest rates, which has been an added burden to
homebuilders and homebuyers alike. By making a long-term commitment to
provide a framework for greater investment, sustained economic growth,
and price stability, my Administration has begun the work of creating a
healthy environment for housing.
TRANSPORTATION
With the passage of the Airline Deregulation Act of 1978, the Motor
Carrier Act of 1980, and the Harley O. Staggers Rail Act of 1980, my
Administration, working with the Congress, has initiated a new era of
reduced regulation of transportation industries. Deregulation will lead
to increased productivity and operating efficiencies in the industries
involved, and stimulate price and service competition, to the benefit of
consumers generally. I urge the new Administration to continue our
efforts on behalf of deregulation legislation for the intercity
passenger bus industry as well.
In the coming decade, the most significant challenge facing the nation
in transportation services will be to improve a deteriorating physical
infrastructure of roadways, railroads, waterways and mass transit
systems, in order to conserve costly energy supplies while promoting
effective transportation services.
HIGHWAYS
Our vast network of highways, which account for 90 percent of travel and
80 percent by value of freight traffic goods movement, is deteriorating.
If current trends continue, a major proportion of the Interstate
pavement will have deteriorated by the end of the 1980’s.
Arresting the deterioration of the nation’s system of highways is a high
priority objective for the 1980’s. We must reorient the Federal mission
from major new construction projects to the stewardship of the existing
Interstate Highway System. Interstate gaps should be judged on the
connections they make and on their compatibility with community needs.
During this decade, highway investments will be needed to increase
productivity, particularly in the elimination of bottlenecks, provide
more efficient connections to ports and seek low-cost solutions to
traffic demand.
My Administration has therefore recommended redefining completion of the
Interstate system, consolidating over 27 categorical assistance programs
into nine, and initiating a major repair and rehabilitation program for
segments of the Interstate system. This effort should help maintain the
condition and performance of the Nation’s highways, particularly the
Interstate and primary system; provide a realistic means to complete the
Interstate system by 1990; ensure better program delivery through
consolidation, and assist urban revitalization. In addition, the
Congress must address the urgent funding problems of the highway trust
fund, and the need to generate greater revenues.
MASS TRANSIT
In the past decade the nation’s public transit systems’ ridership
increased at an annual average of 1.1% each year in the 1970’s (6.9% in
1979). Continued increases in the cost of fuel are expected to make
transit a growing part of the nation’s transportation system.
As a result, my Administration projected a ten year, $43 billion program
to increase mass transit capacity by 50 percent, and promote more energy
efficient vehicle uses in the next decade. The first part of this
proposal was the five year, $24.7 billion Urban Mass Transportation
Administration reauthorization legislation I sent to the Congress in
March, 1980. I urge the 97th Congress to quickly enact this or similar
legislation in 1981.
My Administration was also the first to have proposed and signed into
law a non-urban formula grant program to assist rural areas and small
communities with public transportation programs to end their dependence
on the automobile, promote energy conservation and efficiency, and
provide transportation services to impoverished rural communities.
A principal need of the 1980’s will be maintaining mobility for all
segments of the population in the face of severely increasing
transportation costs and uncertainty of fuel supplies. We must improve
the flexibility of our transportation system and offer greater choice
and diversity in transportation services. While the private automobile
will continue to be the principal means of transportation for many
Americans, public transportation can become an increasingly attractive
alternative. We, therefore, want to explore a variety of paratransit
modes, various types of buses, modern rapid transit, regional rail
systems and light rail systems.
Highway planning and transit planning must be integrated and related to
State, regional, district and neighborhood planning efforts now in place
or emerging. Low density development and land use threaten the fiscal
capacity of many communities to support needed services and
infrastructure.
ELDERLY AND HANDICAPPED TRANSPORTATION
Transportation policies in the 1980’s must pay increasing attention to
the needs of the elderly and handicapped. By 1990, the number of people
over 65 will have grown from today’s 19 million to 27 million. During
the same period, the number of handicapped--people who have difficulty
using transit as well as autos, including the elderly--is expected to
increase from 9 to 11 million, making up 4.5 percent of the population.
We must not retreat from a policy that affords a significant and growing
portion of our population accessible public transportation while
recognizing that the handicapped are a diverse group and will need
flexible, door-to-door service where regular public transportation will
not do the job.
RAILROADS
In addition, the Federal government must reassess the appropriate
Federal role of support for passenger and freight rail services such as
Amtrak and Conrail. Our goal through federal assistance should be to
maintain and enhance adequate rail service, where it is not otherwise
available to needy communities. But Federal subsidies must be closely
scrutinized to be sure they are a stimulus to, and not a replacement
for, private investment and initiative. Federal assistance cannot mean
permanent subsidies for unprofitable operations.
WATERWAYS AND RURAL TRANSPORTATION
There is a growing need in rural and small communities for improved
transportation services. Rail freight service to many communities has
declined as railroads abandon unproductive branch lines. At the same
time, rural roads are often inadequate to handle large, heavily-loaded
trucks. The increased demand for “harvest to harbor” service has also
placed an increased burden on rural transportation systems, while
bottlenecks along the Mississippi River delay grain shipments to the
Gulf of Mexico.
We have made some progress:
--To further develop the nation’s waterways, my Administration began
construction of a new 1,200 foot lock at the site of Lock and Dam 26 on
the Mississippi River. When opened in 1987, the new lock will have a
capacity of 86 million tons per year, an 18 percent increase over the
present system. The U.S. Army Corps of Engineers has also undertaken
studies to assess the feasibility of expanding the Bonneville Locks.
Rehabilitation of John Day Lock was begun in 1980 and should be
completed in 1982. My Administration also supports the completion of the
Upper Mississippi River Master Plan to determine the feasibility of
constructing a second lock at Alton, Illinois. These efforts will help
alleviate delays in transporting corn, soybeans and other goods along
the Mississippi River to the Gulf of Mexico.
--The Department of Transportation’s new Small Community and Rural
Transportation Policy will target federal assistance for passenger
transportation, roads and highways, truck service, and railroad freight
service to rural areas. This policy implements and expands upon the
earlier White House Initiative, “Improving Transportation in Rural
America,” announced in June, 1979, and the President’s “Small Community
and Rural Development Policy” announced in December, 1979. The Congress
should seek ways to balance rail branch line abandonment with the
service needs of rural and farm communities, provide financial
assistance to rail branch line rehabilitation where appropriate, assist
shippers to adjust to rail branch line abandonment where it takes place,
and help make it possible for trucking firms to serve light density
markets with dependable and efficient trucking services.
MARITIME POLICY
During my Administration I have sought to ensure that the U.S. maritime
industry will not have to function at an unfair competitive disadvantage
in the international market. As I indicated in my maritime policy
statement to the Congress in July, 1979, the American merchant marine is
vital to our Nation’s welfare, and Federal actions should promote rather
than harm it. In pursuit of this objective, I signed into law the
Controlled Carrier Act of 1978, authorizing the Federal Maritime
Commission to regulate certain rate cutting practices of some
state-controlled carriers, and recently signed a bilateral maritime
agreement with the People’s Republic of China that will expand the
access of American ships to 20 specified Chinese ports, and set aside
for American-flag ships a substantial share (at least one-third) of the
cargo between our countries. This agreement should officially foster
expanded U.S. and Chinese shipping services linking the two countries,
and will provide further momentum to the growth of Sino-American trade.
There is also a need to modernize and expand the dry bulk segment of our
fleet. Our heavy dependence on foreign carriage of U.S.-bulk cargoes
deprives the U.S. economy of seafaring and shipbuilding jobs, adds to
the balance-of-payments deficit, deprives the Government of substantial
tax revenues, and leaves the United States dependent on foreign-flag
shipping for a continued supply of raw materials to support the civil
economy and war production in time of war.
I therefore sent to the Congress proposed legislation to strengthen this
woefully weak segment of the U.S.-flag fleet by removing certain
disincentives to U.S. construction of dry bulkers and their operation
under U.S. registry. Enactment of this proposed legislation would
establish the basis for accelerating the rebuilding of the U.S.-flag dry
bulk fleet toward a level commensurate with the position of the United
States as the world’s leading bulk trading country.
During the past year the Administration has stated its support for
legislation that would provide specific Federal assistance for the
installation of fuel-efficient engines in existing American ships, and
would strengthen this country’s shipbuilding mobilization base.
Strengthening the fleet is important, but we must also maintain our
shipbuilding base for future ship construction.
Provisions in existing laws calling for substantial or exclusive use of
American-flag vessels to carry cargoes generated by the Government must
be vigorously pursued.
I have therefore supported requirements that 50 percent of oil purchased
for the strategic petroleum reserve be transported in U.S.-flag vessels,
that the Cargo Preference Act be applied to materials furnished for the
U.S. assisted construction of air bases in Israel, and to cargoes
transported pursuant to the Chrysler Corporation Loan Guarantee Act. In
addition, the deep Seabed Hard Mineral Resources Act requires that at
least one ore carrier per mine site be a U.S.-flag vessel.
Much has been done, and much remains to be done. The FY 1982 budget
includes a $107 million authorization for Construction Differential
Subsidy (“CDS”) funds which, added to the unobligated CDS balance of
$100 million from 1980, and the recently enacted $135 million 1981
authorization, will provide an average of $171 million in CDS funds in
1981 and 1982.
COAL EXPORT POLICY
While significant growth in foreign demand for U.S. steam coal is
foreseen, congestion at major U.S. coal exporting ports such as Hampton
Roads, Virginia, and Baltimore, Maryland, could delay and impede
exports.
My Administration has worked through the Interagency Coal Task Force
Study, which I created, to promote cooperation and coordination of
resources between shippers, railroads, vessel broker/ operators and port
operators, and to determine the most appropriate Federal role in
expanding and modernizing coal export facilities, including dredging
deeper channels at selected ports.
Some progress has already been made. In addition to action taken by
transshippers to reduce the number of coal classifications used whenever
possible, by the Norfolk and Western Railroad to upgrade its computer
capability to quickly inventory its coal cars in its yards, and by the
Chessie Railroad which is reactivating Pier 15 in Newport News and has
established a berth near its Curtis Bay Pier in Baltimore to decrease
delays in vessel berthing, public activities will include:
--A $26.5 million plan developed by the State of Pennsylvania and
Conrail to increase Conrail’s coal handling capacity at Philadelphia;
--A proposal by the State of Virginia to construct a steam coal port on
the Craney Island Disposal area in Portsmouth harbor;
--Plans by Mobile, Alabama, which operates the only publicly owned coal
terminal in the U.S. to enlarge its capacity at McDuffie Island to 10
million tons ground storage and 100 car unit train unloading capability;
--Development at New Orleans of steam coal facilities that are expected
to add over 20 million tons of annual capacity by 1983; and
--The Corps of Engineers, working with other interested Federal
agencies, will determine which ports should be dredged, to what depth
and on what schedule, in order to accommodate larger coal carrying
vessels.
Private industry will, of course, play a major role in developing the
United States’ coal export facilities. The new Administration should
continue to work to eliminate transportation bottlenecks that impede our
access to foreign markets.
Special Needs
WOMEN
The past four years have been years of rapid advancement for women. Our
focus has been two-fold: to provide American women with a full range of
opportunities and to make them a part of the mainstream of every aspect
of our national life and leadership.
I have appointed a record number of women to judgeships and to top
government posts. Fully 22 percent of all my appointees are women, and I
nominated 41 of the 46 women who sit on the Federal bench today. For the
first time in our history, women occupy policymaking positions at the
highest level of every Federal agency and department and have
demonstrated their ability to serve our citizens well.
We have strengthened the rights of employed women by consolidating and
strengthening enforcement of sex discrimination laws under the EEOC, by
expanding employment rights of pregnant women through the Pregnancy
Disability Bill, and by increasing federal employment opportunities for
women through civil service reform, and flexi-time and part-time
employment.
By executive order, I created the first national program to provide
women businessowners with technical assistance, grants, loans, and
improved access to federal contracts.
We have been sensitive to the needs of women who are homemakers. I
established an Office of Families within HHS and sponsored the White
House Conference on Families. We initiated a program targeting CETA
funds to help displaced homemakers. The Social Security system was
amended to eliminate the widow’s penalty and a comprehensive study of
discriminatory provisions and possible changes was presented to
Congress. Legislation was passed to give divorced spouses of foreign
service officers rights to share in pension benefits.
We created an office on domestic violence within HHS to coordinate the
12 agencies that now have domestic violence relief programs, and to
distribute information on the problem and the services available to
victims.
Despite a stringent budget for FY 1981, the Administration consistently
supported the Women’s Educational Equity Act and family planning
activities, as well as other programs that affect women, such as food
stamps, WIC, and social security.
We have been concerned not only about the American woman’s
opportunities, but ensuring equality for women around the world. In
November, 1980, I sent to the Senate the Convention on the Elimination
of All Forms of Discrimination Against Women. This United Nations
document is the most comprehensive and detailed international agreement
which seeks the advancement of women.
On women’s issues, I have sought the counsel of men and women in and out
of government and from all regions of our country. I established two
panels-- the President’s Advisory Committee for Women and the
Interdepartmental Task Force on Women--to advise me on these issues. The
mandate for both groups expired on December 31, but they have left
behind a comprehensive review of the status of women in our society
today. That review provides excellent guidance for the work remaining in
our battle against sex discrimination.
Even though we have made progress, much remains on the agenda for women.
I remain committed to the Equal Rights Amendment and will continue to
work for its passage. It is essential to the goal of bringing America’s
women fully into the mainstream of American life that the ERA be
ratified.
The efforts begun for women in employment, business and education should
be continued and strengthened. Money should be available to states to
establish programs to help the victims of domestic violence. Congress
should pass a national health care plan and a welfare reform program,
and these measures should reflect the needs of women.
The talents of women should continue to be used to the fullest inside
and outside of government, and efforts should continue to see that they
have the widest range of opportunities and options.
HANDICAPPED
I hope that my Administration will be remembered in this area for
leading the way toward full civil rights for handicapped Americans. When
I took office, no federal agency had yet issued 504 regulations. As I
leave office, this first step by every major agency and department in
the federal government is almost complete. But it is only a first step.
The years ahead will require steadfast dedication by the President to
protect and promote these precious rights in the classroom, in the
workplace, and in all public facilities so that handicapped individuals
may join the American mainstream and contribute to the fullest their
resources and talents to our economic and social life.
Just as we supported, in an unprecedented way, the civil rights of
disabled persons in schools and in the workplace, other initiatives in
health prevention, such as our immunization and nutrition programs for
young children and new intense efforts to reverse spinal cord injury,
must continue so that the incidence of disability continues to decline.
This year is the U.N.-declared International Year of Disabled Persons.
We are organizing activities to celebrate and promote this important
commemorative year within the government as well as in cooperation with
private sector efforts in this country and around the world. The
International Year will give our country the opportunity to recognize
the talents and capabilities of our fellow citizens with disabilities.
We can also share our rehabilitation and treatment skills with other
countries and learn from them as well. I am proud that the United States
leads the world in mainstreaming and treating disabled people. However,
we have a long way to go before all psychological and physical barriers
to disabled people are torn down and they can be full participants in
our American way of life. We must pledge our full commitment to this
goal during the International Year.
FAMILIES
Because of my concern for American families, my Administration convened
last year the first White House Conference on Families which involved
seven national hearings, over 506 state and local events, three White
House Conferences, and the direct participation of more than 125,000
citizens. The Conference reaffirmed the centrality of families in our
lives and nation but documented problems American families face as well.
We also established the Office of Families within the Department of
Health and Human Services to review government policies and programs
that affect families.
I expect the departments and agencies within the executive branch of the
Federal government as well as Members of Congress, corporate and
business leaders, and State and local officials across the country, to
study closely the recommendations of the White House Conference and
implement them appropriately. As public policy is developed and
implemented by the Federal government, cognizance of the work of the
Conference should be taken as a pragmatic and essential step.
The Conference has done a good job of establishing an agenda for action
to assure that the policies of the Federal government are more sensitive
in their impact on families. I hope the Congress will review and
seriously consider the Conference’s recommendations.
OLDER AMERICANS
My Administration has taken great strides toward solving the difficult
problems faced by older Americans. Early in my term we worked
successfully with the Congress to assure adequate revenues for the
Social Security Trust Funds. And last year the strength of the Social
Security System was strengthened by legislation I proposed to permit
borrowing among the separate trust funds. I have also signed into law
legislation prohibiting employers from requiring retirement prior to age
70, and removing mandatory retirement for most Federal employees. In
addition, my Administration worked very closely with Congress to amend
the Older Americans Act in a way that has already improved
administration of its housing, social services, food delivery, and
employment programs.
This year, I will be submitting to Congress a budget which again
demonstrates my commitment to programs for the elderly. It will include,
as my previous budgets have, increased funding for nutrition, senior
centers and home health care, and will focus added resources on the
needs of older Americans.
With the 1981 White House Conference on Aging approaching, I hope the
new Administration will make every effort to assure an effective and
useful conference. This Conference should enable older Americans to
voice their concerns and give us guidance in our continued efforts to
ensure the quality of life so richly deserved by our senior citizens.
REFUGEES
We cannot hope to build a just and humane society at home if we ignore
the humanitarian claims of refugees, their lives at stake, who have
nowhere else to turn. Our country can be proud that hundreds of
thousands of people around the world would risk everything they
have--including their own lives--to come to our country.
This Administration initiated and implemented the first comprehensive
reform of our refugee and immigration policies in over 25 years. We also
established the first refugee coordination office in the Department of
State under the leadership of a special ambassador and coordinator for
refugee affairs and programs. The new legislation and the coordinator’s
office will bring common sense and consolidation to our Nation’s
previously fragmented, inconsistent, and in many ways, outdated, refugee
and immigration policies.
With the unexpected arrival of thousands of Cubans and Haitians who
sought refuge in our country last year, outside of our regular
immigration and refugee admissions process, our country and its
government were tested in being compassionate and responsive to a major
human emergency. Because we had taken steps to reorganize our refugee
programs, we met that test successfully. I am proud that the American
people responded to this crisis with their traditional good will and
hospitality. Also, we would never have been able to handle this
unprecedented emergency without the efforts of the private resettlement
agencies who have always been there to help refugees in crises.
Immigrants to this country always contribute more toward making our
country stronger than they ever take from the system. I am confident
that the newest arrivals to our country will carry on this tradition.
While we must remain committed to aiding and assisting those who come to
our shores, at the same time we must uphold our immigration and refugee
policies and provide adequate enforcement resources. As a result of our
enforcement policy, the illegal flow from Cuba has been halted and an
orderly process has been initiated to make certain that our refugee and
immigration laws are honored.
This year the Select Commission on Immigration and Refugee Policy will
complete its work and forward its advice and recommendations. I hope
that the recommendations will be carefully considered by the new
Administration and the Congress, for it is clear that we must take
additional action to keep our immigration policy responsive to
emergencies and ever changing times.
VETERANS
This country and its leadership has a continuing and unique obligation
to the men and women who served their nation in the armed forces and
help maintain or restore peace in the world.
My commitment to veterans, as evidenced by my record, is characterized
by a conscientious and consistent emphasis in these general areas:
First, we have worked to honor the Vietnam veteran. During my
Administration, and under the leadership of VA Administrator Max
Cleland, I was proud to lead our country in an overdue acknowledgement
of our Nation’s gratitude to the men and women who served their country
during the bitter war in Southeast Asia. Their homecoming was deferred
and seemed doomed to be ignored. Our country has matured in the last
four years and at long last we were able to separate the war from the
warrior and honor these veterans. But with our acknowledgement of their
service goes an understanding that some Vietnam veterans have unique
needs and problems.
My Administration was able to launch a long sought after psychological
readjustment and outreach program, unprecedented in its popularity,
sensitivity and success. This program must be continued. The
Administration has also grappled with the difficult questions posed by
some veterans who served in Southeast Asia and were exposed to
potentially harmful substances, including the herbicide known as Agent
Orange. We have launched scientific inquiries that should answer many
veterans’ questions about their health and should provide the basis for
establishing sound compensation policy. We cannot rest until their
concerns are dealt with in a sensitive, expeditious and compassionate
fashion.
Second, we have focused the VA health care system in the needs of the
service-connected disabled veteran. We initiated and are implementing
the first reform of the VA vocational rehabilitation system since its
inception in 1943. Also, my Administration was the first to seek a
cost-of-living increase for the recipients of VA compensation every
year. My last budget also makes such a request. The Administration also
launched the Disabled Veterans Outreach Program in the Department of
Labor which has successfully placed disabled veterans in jobs. Services
provided by the VA health care system will be further targeted to the
special needs of disabled veterans during the coming year.
Third, the VA health care system, the largest in the free world, has
maintained its independence and high quality during my Administration.
We have made the system more efficient and have therefore treated more
veterans than ever before by concentrating on out-patient care and
through modern management improvements. As the median age of the
American veteran population increases, we must concentrate on further
changes within the VA system to keep it independent and to serve as a
model to the nation and to the world as a center for research, treatment
and rehabilitation.
Government Assistance
GENERAL AID TO STATE AND LOCAL GOVERNMENTS
Since taking office, I have been strongly committed to strengthening the
fiscal and economic condition of our Nation’s State and local
governments. I have accomplished this goal by encouraging economic
development of local communities, and by supporting the General Revenue
Sharing and other essential grant-in-aid programs.
GRANTS-IN-AID TO STATES AND LOCALITIES
During my Administration, total grants-in-aid to State and local
governments have increased by more than 40 percent, from $68 billion in
Fiscal Year 1977 to $96 billion in Fiscal Year 1981. This significant
increase in aid has allowed States and localities to maintain services
that are essential to their citizens without imposing onerous tax
burdens. It also has allowed us to establish an unprecedented
partnership between the leaders of the Federal government and State and
local government elected officials.
GENERAL REVENUE SHARING
Last year Congress enacted legislation that extends the General Revenue
Sharing program for three more years. This program is the cornerstone of
our efforts to maintain the fiscal health of our Nation’s local
government. It will provide $4.6 billion in each of the next three years
to cities, counties and towns. This program is essential to the
continued ability of our local governments to provide essential police,
fire and sanitation services.
This legislation renewing GRS will be the cornerstone of
Federal-State-local government relations in the 1980’s. This policy will
emphasize the need for all levels of government to cooperate in order to
meet the needs of the most fiscally strained cities and counties, and
also will emphasize the important role that GRS can play in forging this
partnership. I am grateful that Congress moved quickly to assure that
our Nation’s localities can begin the 1980’s in sound fiscal condition.
COUNTER-CYCLICAL ASSISTANCE
Last year, I proposed that Congress enact a $1 billion counter-cyclical
fiscal assistance program to protect States and localities from
unexpected changes in the national economy. This program unfortunately
was not enacted by the [full] Congress. I, therefore, have not included
funding for counter-cyclical aid in my Fiscal Year 1982 budget.
Nevertheless, I urge Congress to enact a permanent stand-by
counter-cyclical program, so that States and cities can be protected
during the next economic downturn.
URBAN POLICY
Three years ago, I proposed the Nation’s first comprehensive urban
policy. That policy involved more than one hundred improvements in
existing Federal programs, four new Executive Orders and nineteen pieces
of urban-oriented legislation. With Congress’ cooperation, sixteen of
these bills have now been signed into law.
ECONOMIC DEVELOPMENT
One of the principal goals of my domestic policy has been to strengthen
the private sector economic base of our Nation’s economically troubled
urban and rural areas. With Congress’ cooperation, we have substantially
expanded the Federal government’s economic development programs and
provided new tax incentives for private investment in urban and rural
communities. These programs have helped many communities to attract new
private sector jobs and investments and to retain the jobs and
investments that already are in place.
When I took office, the Federal government was spending less than $300
million annually on economic development programs, and only $60 million
of those funds in our Nation’s urban areas. Since that time, we have
created the Urban Development Action Grant (UDAG) program and
substantially expanded the economic development programs in the Commerce
Department. My FY 1982 budget requests more than $1.5 billion for
economic development grants, loans and interest subsidies and almost
$1.5 billion for loan guarantees. Approximately 60 percent of these
funds will be spent in our Nation’s urban areas. In addition, we have
extended the 10 percent investment credit to include rehabilitation of
existing industrial facilities as well as new construction.
I continue to believe that the development of private sector investment
and jobs is the key to revitalizing our Nation’s economically depressed
urban and rural areas. To ensure that the necessary economic development
goes forward, the Congress must continue to provide strong support for
the UDAG program and the programs for the Economic Development
Administration. Those programs provide a foundation for the economic
development of our Nation in the 1980’s.
COMMUNITY DEVELOPMENT
The partnership among Federal, State and local governments to revitalize
our Nation’s communities has been a high priority of my Administration.
When I took office, I proposed a substantial expansion of the Community
Development Block Grant (CDBG) program and the enactment of a new $400
million Urban Development Action Grant (UDAG) program. Both of these
programs have provided essential community and economic development
assistance to our Nation’s cities and counties.
Last year, Congress reauthorized both the CDBG and UDAG programs. The
CDBG program was reauthorized for three more years with annual funding
increases of $150 million, and the UDAG program was extended for three
years at the current funding level of $675 million annually. My 1982
budget requests full funding for both of these programs. These actions
should help our Nation’s cities and counties to continue the progress
they have made in the last three years.
NEIGHBORHOODS
During my Administration we have taken numerous positive steps to
achieve a full partnership of neighborhood organizations and government
at all levels. We have successfully fought against red lining and
housing discrimination. We created innovative Self Help funding and
technical resource transfer mechanisms. We have created unique methods
of access for neighborhood organizations to have a participating role in
Federal and State government decision-making. Neighborhood based
organizations are the threshold of the American community.
The Federal government will need to develop more innovative and
practical ways for neighborhood based organizations to successfully
participate in the identification and solution of local and neighborhood
concerns. Full partnership will only be achieved with the knowing
participation of leaders of government, business, education and unions.
Neither state nor Federal solutions imposed from on high will suffice.
Neighborhoods are the fabric and soul of this great land. Neighborhoods
define the weave that has been used to create a permanent fabric. The
Federal government must take every opportunity to provide access and
influence to the individuals and organizations affected at the
neighborhood level.
Rural Policy
Since the beginning of my Administration, I have been committed to
improving the effectiveness with which the Federal government deals with
the problems and needs of a rapidly changing rural America. The rapid
growth of some rural areas has placed a heavy strain on communities and
their resources. There are also persistent problems of poverty and
economic stagnation in other parts of rural America. Some rural areas
continue to lose population, as they have for the past several decades.
In December, 1979, I announced the Small Community and Rural Development
Policy. It was the culmination of several years’ work and was designed
to address the varying needs of our rural population. In 1980, my
Administration worked with the Congress to pass the Rural Development
Policy Act of 1980, which when fully implemented will allow us to meet
the needs of rural people and their communities more effectively and
more efficiently.
As a result of the policy and the accompanying legislation, we have:
--Created the position of Under Secretary of Agriculture for Small
Community and Rural Development to provide overall leadership.
--Established a White House Working Group to assist in the
implementation of the policy.
--Worked with more than 40 governors to form State rural development
councils to work in partnership with the White House Working Group, and
the Federal agencies, to better deliver State and Federal programs to
rural areas.
--Directed the White House Working Group to annually review existing and
proposed policies, programs, and budget levels to determine their
adequacy in meeting rural needs and the fulfilling of the policy’s
objectives and principles.
This effort on the part of my Administration and the Congress has
resulted in a landmark policy. For the first time, rural affairs has
received the prominence it has always deserved. It is a policy that can
truly help alleviate the diverse and differing problems rural America
will face in the 1980’s.
With the help and dedication of a great many people around the country
who are concerned with rural affairs, we have constructed a mechanism
for dealing effectively with rural problems. There is now a great
opportunity to successfully combine Federal efforts with the efforts of
rural community leaders and residents. It is my hope this spirit of
cooperation and record of accomplishment will be continued in the coming
years.
CONSUMERS
In September, 1979, I signed an Executive Order designed to strengthen
and coordinate Federal consumer programs and to establish procedures to
improve and facilitate consumer participation in government
decision-making. Forty Federal agencies have adopted programs to comply
with the requirements of the Order. These programs will improve
complaint handling, provide better information to consumers, enhance
opportunities for public participation in government proceedings, and
assure that the consumer point of view is considered in all programs,
policies, and regulations.
While substantial progress has been made in assuring a consumer presence
in Federal agencies, work must continue to meet fully the goals of the
Executive Order. Close monitoring of agency compliance with the
requirements of the Order is necessary. Continued evaluation to assure
that the programs are effective and making maximum use of available
resources is also essential. As a complement to these initiatives,
efforts to provide financial assistance in regulatory proceedings to
citizen groups, small businesses, and others whose participation is
limited by their economic circumstances must continue to be pursued.
It is essential that consumer representatives in government pay
particular attention to the needs and interests of low-income consumers
and minorities. The Office of Consumer Affairs’ publication, “People
Power: What Communities Are Doing to Counter Inflation,” catalogues some
of the ways that government and the private sector can assist the less
powerful in our society to help themselves. New ways should be found to
help foster this new people’s movement which is founded on the principle
of self-reliance.
Science and Technology
Science and technology contribute immeasurably to the lives of all
Americans. Our high standard of living is largely the product of the
technology that surrounds us in the home or factory. Our good health is
due in large part to our ever increasing scientific understanding. Our
national security is assured by the application pate science and
technology will bring.
The Federal government has a special role to play in science and
technology. Although the fruits of scientific achievements surround us,
it is often difficult to predict the benefits that will arise from a
given scientific venture. And these benefits, even if predictable, do
not usually lead to ownership rights. Accordingly, the Government has a
special obligation to support science as an investment in our future.
My Administration has sought to reverse a decade-long decline in
funding. Despite the need for fiscal restraint, real support of basic
research has grown nearly 11% during my term in office. And, my
Administration has sought to increase the support of long-term research
in the variety of mission agencies. In this way, we can harness the
American genius for innovation to meet the economic, energy, health, and
security challenges that confront our nation.
--International Relations and National Security. Science and technology
are becoming increasingly important elements of our national security
and foreign policies. This is especially so in the current age of
sophisticated defense systems and of growing dependence among all
countries on modern technology for all aspects of their economic
strength. For these reasons, scientific and technological considerations
have been integral elements of the Administration’s decision-making on
such national security and foreign policy issues as the modernization of
our strategic weaponry, arms control, technology transfer, the growing
bilateral relationship with China, and our relations with the developing
world.
Four themes have shaped U.S. policy in international scientific and
technological cooperation: pursuit of new international initiatives to
advance our own research and development objectives; development and
strengthening of scientific exchange to bridge politically ideological,
and cultural divisions between this country and other countries;
formulation of programs and institutional relations to help developing
countries use science and technology beneficially; and cooperation with
other nations to manage technologies with local impact. At my direction,
my Science and Technology Adviser has actively pursued international
programs in support of these four themes. We have given special
attention to scientific and technical relations with China, to new forms
of scientific and technical cooperation with Japan, to cooperation with
Mexico, other Latin American and Caribbean countries and several states
in Black America, and to the proposed Institute for Scientific and
Technological Cooperation.
In particular our cooperation with developing countries reflects the
importance that each of them has placed on the relationship between
economic growth and scientific and technological capability. It also
reflects their view that the great strength of the U.S. in science and
technology makes close relations with the U.S. technical community an
especially productive means of enhancing this capability. Scientific and
technological assistance is a key linkage between the U.S. and the
developing world, a linkage that has been under-utilized in the past and
one which we must continue to work to strengthen.
--Space Policy. The Administration has established a framework for a
strong and evolving space program for the 1980’s.
The Administration’s space policy reaffirmed the separation of military
space systems and the open civil space program, and at the same time,
provided new guidance on technology transfer between the civil and
military programs. The civil space program centers on three basic
tenets: First, our space policy will reflect a balanced strategy of
applications, science, and technology development. Second, activities
will be pursued when they can be uniquely or more efficiently
accomplished in space. Third, a premature commitment to a high
challenge, space-engineering initiative of the complexity of Apollo is
inappropriate. As the Shuttle development phases down, however, there
will be added flexibility to consider new space applications, space
science and new space exploration activities.
--Technology Development. The Shuttle dominates our technology
development effort and correctly so. It represents one of the most
sophisticated technological challenges ever undertaken, and as a result,
has encountered technical problems. Nonetheless, the first manned
orbital flight is now scheduled for March, 1981. I have been pleased to
support strongly the necessary funds for the Shuttle throughout my
Administration.
--Space Applications. Since 1972, the U.S. has conducted experimental
civil remote sensing through Landsat satellites, thereby realizing many
successful applications. Recognizing this fact, I directed the
implementation of an operational civil land satellite remote sensing
system, with the operational management responsibility in Commerce’s
National Oceanic and Atmospheric Administration. In addition, because
ocean observations from space can meet common civil and military data
requirements, a National Oceanic Satellite System has been proposed as a
major FY 1981 new start.
--Space Science Exploration. The goals of this Administration’s policy
in space science have been to: (1) continue a vigorous program of
planetary exploration to understand the origin and evolution of the
solar system; (2) utilize the space telescope and free-flying satellites
to usher in a new era of astronomy; (3) develop a better understanding
of the sun and its interaction with the terrestrial environment; and (4)
utilize the Shuttle and Spacelab to conduct basic research that
complements earth-based life science investigations.
DISTRICT OF COLUMBIA
Washington, D.C., is home to both the Federal Government and to more
than half a million American citizens. I have worked to improve the
relationship between the Federal establishment and the Government of the
District of Columbia in order to further the goals and spirit of home
rule. The City controls more of its own destiny than was the case four
years ago. Yet, despite the close cooperation between my Administration
and that of Mayor Barry, we have not yet seen the necessary number of
states ratify the Constitutional Amendment granting full voting
representation in the Congress to the citizens of this city. It is my
hope that this inequity will be rectified. The country and the people
who inhabit Washington deserve no less.
THE ARTS
The arts are a precious national resource.
Federal support for the arts has been enhanced during my Administration
by expanding government funding and services to arts institutions,
individual artists, scholars, and teachers through the National
Endowment for the Arts. We have broadened its scope and reach to a more
diverse population. We have also reactivated the Federal Council on the
Arts and Humanities.
It is my hope that during the coming years the new Administration and
the Congress will:
--Continue support of institutions promoting development and
understanding of the arts;
--Encourage business participants in a comprehensive effort to achieve a
truly mixed economy of support for the arts;
--Explore a variety of mechanisms to nurture the creative talent of our
citizens and build audiences for their work;
--Support strong, active National Endowments for the Arts;
--Seek greater recognition for the rich cultural tradition of the
nation’s minorities;
--Provide grants for the arts in low-income neighborhoods.
THE HUMANITIES
In recently reauthorizing Federal appropriations for the National
Endowment for the Humanities, the Congress has once again reaffirmed
that “the encouragement and support of national progress and scholarship
in the humanities . . . while primarily a matter for private and local
initiative, is also an appropriate matter of concern to the Federal
Government” and that “a high civilization must not limit its efforts to
science and technology alone but must give full value and support to the
other great branches of man’s scholarly and cultural activity in order
to achieve a better understanding of the past, a better analysis of the
present, and a better view of the future.”
I believe we are in agreement that the humanities illuminate the values
underlying important personal, social, and national questions raised in
our society by its multiple links to and increasing dependence on
technology, and by the diverse heritage of our many regions and ethnic
groups. The humanities cast light on the broad issue of the role in a
society of men and women of imagination and energy--those individuals
who through their own example define “the spirit of the age,” and in so
doing move nations. Our Government’s support for the humanities, within
the framework laid down by the Congress, is a recognition of their
essential nourishment of the life of the mind and vital enrichment of
our national life.
I will be proposing an increase in funding this year sufficient to
enable the Endowment to maintain the same level of support offered our
citizens in Fiscal Year 1981.
In the allocation of this funding, special emphasis will be given to:
--Humanities education in the nation’s schools, in response to the great
needs that have arisen in this area;
--Scholarly research designed to increase our understanding of the
cultures, traditions, and historical forces at work in other nations and
in our own;
--Drawing attention to the physical disintegration of the raw material
of our cultural heritage--books, manuscripts, periodicals, and other
documents--and to the development of techniques to prevent the
destruction and to preserve those materials; and
--The dissemination of quality programming in the humanities to
increasingly large American audiences through the use of radio and
television.
The dominant effort in the Endowment’s expenditures will be a commitment
to strengthen and promulgate scholarly excellence and achievement in
work in the humanities in our schools, colleges, universities,
libraries, museums and other cultural institutions, as well as in the
work of individual scholars or collaborative groups engaged in advanced
research in the humanities.
In making its grants the Endowment will increase its emphasis on
techniques which stimulate support for the humanities from non-Federal
sources, in order to reinforce our tradition of private philanthropy in
this field, and to insure and expand the financial viability of our
cultural institutions and life.
INSULAR AREAS
I have been firmly committed to self-determination for Puerto Rico, the
Virgin Islands, Guam, American Samoa and the Northern Mariana Islands,
and have vigorously supported the realization of whatever political
status aspirations are democratically chosen by their peoples. This
principle was the keystone of the comprehensive territorial policy I
sent the Congress last year. I am pleased that most of the legislative
elements of that policy were endorsed by the 96th Congress.
The unique cultures, fragile economies, and locations of our Caribbean
and Pacific Islands are distinct assets to the United States which
require the sensitive application of policy. The United States
Government should pursue initiatives begun by my Administration and the
Congress to stimulate insular economic development; enhance treatment
under Federal programs eliminating current inequities; provide vitally
needed special assistance and coordinate and rationalize policies. These
measures will result in greater self-sufficiency and balanced growth. In
particular, I hope that the new Congress will support funding for fiscal
management, comprehensive planning and other technical assistance for
the territories, as well as create the commission I have proposed to
review the applicability of all Federal laws to the insular areas and
make recommendations for appropriate modification.
IV. REMOVING GOVERNMENTAL WASTE AND INEFFICIENCY
One of my major commitments has been to restore public faith in our
Federal government by cutting out waste and inefficiency. In the past
four years, we have made dramatic advances toward this goal, many of
them previously considered impossible to achieve. Where government rules
and operations were unnecessary, they have been eliminated, as with
airline, rail, trucking and financial deregulation. Where government
functions are needed, they have been streamlined, through such landmark
measures as the Civil Service Reform Act of 1978. I hope that the new
administration and the Congress will keep up the momentum we have
established for effective and responsible change in this area of crucial
public concern.
CIVIL SERVICE REFORM
In March 1978, I submitted the Civil Service Reform Act to Congress. I
called it the centerpiece of my efforts to reform and reorganize the
government. With bipartisan support from Congress, the bill passed, and
I am pleased to say that implementation is running well ahead of the
statutory schedule. Throughout the service, we are putting into place
the means to assure that reward and retention are based on performance
and not simply on length of time on the job. In the first real test of
the Reform Act, 98 percent of the eligible top-level managers joined the
Senior Executive Service, choosing to relinquish job protections for the
challenge and potential reward of this new corps of top executives.
Though the Act does not require several of its key elements to be in
operation for another year, some Federal agencies already have
established merit pay systems for GS-13-15 managers, and most agencies
are well on their way to establishing new performance standards for all
their employees. All have paid out, or are now in the process of paying
out, performance bonuses earned by outstanding members of the Senior
Executive Service. Dismissals have increased by 10 percent, and
dismissals specifically for inadequate job performance have risen 1500
percent, since the Act was adopted. Finally, we have established a fully
independent Merit Systems Protection Board and Special Counsel to
protect the rights of whistle-blowers and other Federal employees faced
with threats to their rights.
In 1981, civil service reform faces critical challenges, all agencies
must have fully functioning performance appraisal systems for all
employees, and merit pay systems for compensating the government’s
130,000 GS-13-15 managers. Performance bonuses for members of the Senior
Executive Service will surely receive scrutiny. If this attention is
balanced and constructive, it can only enhance the chances for ultimate
success of our bipartisan commitment to the revolutionary and crucial
“pay for performance” concept.
REGULATORY REFORM
During the past four years we have made tremendous progress in
regulatory reform. We have discarded old economic regulations that
prevented competition and raised consumer costs, and we have imposed
strong management principles on the regulatory programs the country
needs, cutting paperwork and other wasteful burdens. The challenge for
the future is to continue the progress in both areas without crippling
vital health and safety programs.
Our economic deregulation program has achieved major successes in five
areas:
Airlines: The Airline Deregulation Act is generating healthy
competition, saving billions in fares, and making the airlines more
efficient. The Act provides that in 1985 the CAB itself will go out of
existence.
Trucking: The trucking deregulation bill opens the industry to
competition and allows truckers wide latitude on the routes they drive
and the goods they haul. The bill also phases out most of the old law’s
immunity for setting rates. The Congressional Budget Office estimates
these reforms will save as much as $8 billion per year and cut as much
as half a percentage point from the inflation rate.
Railroads: Overregulation has stifled railroad management initiative,
service, and competitive pricing. The new legislation gives the
railroads the freedom they need to rebuild a strong, efficient railroad
industry.
Financial Institutions: With the help of the Congress, over the past
four years we have achieved two major pieces of financial reform
legislation, legislation which has provided the basis for the most
far-reaching changes in the financial services industry since the
1930’s. The International Banking Act of 1978 was designed to reduce the
advantages that foreign banks operating in the United States possessed
in comparison to domestic banks. The Depository Institutions
Deregulation and Monetary Control Act, adopted last March, provides for
the phased elimination of a variety of anti-competitive barriers to
financial institutions and freedom to offer services to and attract the
savings of consumers, especially small savers.
Recently, I submitted to the Congress my Administration’s
recommendations for the phased liberalization of restrictions on
geographic expansion by commercial banks. Last year the Administration
and financial regulatory agencies proposed legislation to permit the
interstate acquisition of failing depository institutions. In view of
the difficult outlook for some depository institutions I strongly urge
the Congress to take prompt favorable action on the failing bank
legislation.
Telecommunications: While Congress did not pass legislation in this
area, the Federal Communications Commission has taken dramatic action to
open all aspects of communications to competition and to eliminate
regulations in the areas where competition made them obsolete. The
public is benefitting from an explosion of competition and new services.
While these initiatives represent dramatic progress in economic
deregulation, continued work is needed. I urge Congress to act on
communications legislation and to consider other proposed deregulation
measures, such as legislation on the bus industry. In addition, the
regulatory commissions must maintain their commitment to competition as
the best regulator of all.
The other part of my reform program covers the regulations that are
needed to protect the health, safety, and welfare of our citizens. For
these regulations, my Administration has created a management program to
cut costs without sacrificing goals. Under my Executive Order 12044, we
required agencies to analyze the costs of their major new rules and
consider alternative approaches, such as performance standards and
voluntary codes, that may make rules less costly and more flexible. We
created the Regulatory Analysis Review Group in the White House to
analyze the most costly proposed new rules and find ways to improve
them. The Regulatory Council was established to provide the first
Government-wide listing of upcoming rules and eliminate overlapping and
conflicting regulations. Agencies have launched “sunset” programs to
weed out outmoded old regulations. We have acted to encourage public
participation in regulatory decision-making.
These steps have already saved billions of dollars in regulatory costs
and slashed thousands of outmoded regulations. We are moving steadily
toward a regulatory system that provides needed protections fairly,
predictably, and at minimum cost.
I urge Congress to continue on this steady path and resist the
simplistic solutions that have been proposed as alternatives. Proposals
like legislative veto and increased judicial review will add another
layer to the regulatory process, making it more cumbersome and
inefficient. The right approach to reform is to improve the individual
statutes, where they need change, and to ensure that the regulatory
agencies implement those statutes sensibly.
PAPERWORK REDUCTION
The Federal Government imposes a huge paperwork burden on business,
local government, and the private sector. Many of these forms are needed
for vital government functions, but others are duplicative, overly
complex or obsolete.
During my Administration we cut the paperwork burden by 15 percent, and
we created procedures to continue this progress. The new Paperwork
Reduction Act centralizes, in OMB, oversight of all agencies’
information requirements and strengthens OMB’s authority to eliminate
needless forms. The “paperwork budget” process, which I established by
executive order, applies the discipline of the budget process to the
hours of reporting time imposed on the public, forcing agencies to
scrutinize all their forms each year. With effective implementation,
these steps should allow further, substantial paperwork cuts in the
years ahead.
TIGHTENING STANDARDS FOR GOVERNMENTAL EFFICIENCY AND INTEGRITY
To develop a foundation to carry out energy policy, we consolidated
scattered energy programs and launched the Synthetic Fuels Corporation;
to give education the priority it deserves and at the same time reduce
HHS to more manageable size, I gave education a seat at the Cabinet
table, to create a stronger system for attacking waste and fraud, I
reorganized audit and investigative functions by putting an Inspector
General in major agencies. Since I took office, we have submitted 14
reorganization initiatives and had them all approved by Congress. We
have saved hundreds of millions of dollars through the adoption of
businesslike cash management principles and set strict standards for
personal financial disclosure and conflict of interest avoidance by high
Federal officials.
To streamline the structure of the government, we have secured approval
of 14 reorganization initiatives, improving the efficiency of the most
important sectors of the government, including energy, education, and
civil rights enforcement. We have eliminated more than 300 advisory
committees as well as other agencies, boards and commissions which were
obsolete or ineffective. Independent Inspectors General have been
appointed in major agencies to attack fraud and waste. More than a
billion dollars of questionable transactions have been identified
through their audit activities.
The adoption of business-like cash management and debt collection
initiatives will save over $1 billion, by streamlining the processing of
receipts, by controlling disbursements more carefully, and by reducing
idle cash balances. Finally this Administration has set strict standards
for personal financial disclosure and conflict of interest avoidance by
high Federal officials, to elevate the level of public trust in the
government.
V. PROTECTING BASIC RIGHTS AND LIBERTIES
I am extremely proud of the advances we have made in ensuring equality
and protecting the basic freedoms of all Americans.
--The Equal Employment Opportunity Commission (EEOC) and the Office of
Federal Contract Compliance (OFCCP) have been reorganized and
strengthened and a permanent civil rights unit has been established in
OMB.
--To avoid fragmented, inconsistent and duplicative enforcement of civil
rights laws, three agencies have been given coordinative and
standard-setting responsibilities in discrete areas: EEOC for all
employment-related activities, HUD for all those relating to housing,
and the Department of Justice for all other areas.
--With the enactment of the Right to Financial Privacy Act and a bill
limiting police search of newsrooms, we have begun to establish a sound,
comprehensive, privacy program.
Ratification of the Equal Rights Amendment must be aggressively pursued.
Only one year remains in which to obtain ratification by three
additional states.
The Congress must give early attention to a number of important bills
which remain. These bills would:
--strengthen the laws against discrimination in housing. Until it is
enacted, the 1968 Civil Rights Act’s promise of equal access to housing
will remain unfulfilled;
--establish a charter for the FBI and the intelligence agencies. The
failure to define in law the duties and responsibilities of these
agencies has made possible some of the abuses which have occurred in
recent years;
--establish privacy safeguards for medical research, bank, insurance,
and credit records; and provide special protection for election fund
transfer systems.
EQUAL RIGHTS AMENDMENT
I remain committed as strongly as possible to the ratification of the
Equal Rights Amendment.
As a result of our efforts in 1978, the Equal Rights Amendment’s
deadline for ratification was extended for three years. We have now one
year and three States left. We cannot afford any delay in marshalling
our resources and efforts to obtain the ratification of those three
additional States.
Although the Congress has no official role in the ratification process
at this point, you do have the ability to affect public opinion and the
support of State Legislators for the Amendment. I urge Members from
States which have not yet ratified the Equal Rights Amendment to use
their influence to secure ratification. I will continue my own efforts
to help ensure ratification of the Equal Rights Amendment.
MARTIN LUTHER KING, JR.
Dr. Martin Luther King, Jr. led this Nation’s effort to provide all its
citizens with civil rights and equal opportunities. His commitment to
human rights, peace and non-violence stands as a monument to his
humanity and courage. As one of our Nation’s most outstanding leaders,
it is appropriate that his birthday be commemorated as a national
holiday. I hope the Congress will enact legislation this year that will
achieve this goal.
FAIR HOUSING
The Fair Housing Act Amendments of 1980 passed the House of
Representatives by an overwhelming bipartisan majority only to die in
the Senate at the close of the 96th Congress. The leaders of both
parties have pledged to make the enactment of fair housing legislation a
top priority of the incoming Congress. The need is pressing and a
strengthened federal enforcement effort must be the primary method of
resolution.
CRIMINAL CODE
The Federal criminal laws are often archaic, frequently contradictory
and imprecise, and clearly in need of revision and codification. The new
Administration should continue the work which has been begun to develop
a Federal criminal code which simplifies and clarifies our criminal
laws, while maintaining our basic civil liberties and protections.
PRIVACY
As our public and private institutions collect more and more information
and as communications and computer technologies advance, we must act to
protect the personal privacy of our citizens.
In the past four years we acted on the report of the Privacy Commission
and established a national privacy policy. We worked with Congress to
pass legislation restricting wiretaps and law enforcement access to bank
records and to reporters’ files. We reduced the number of personal files
held by the government and restricted the transfer of personal
information among Federal agencies. We also worked with the Organization
for Economic Cooperation and Development to establish international
guidelines to protect the privacy of personal information that is
transferred across borders.
VI. PROTECTING AND DEVELOPING OUR NATURAL RESOURCES
Two of our Nation’s most precious natural resources are our environment
and our vast agricultural capacity. From the beginning of my
Administration, I have worked with the Congress to enhance and protect,
as well as develop our natural resources. In the environmental areas, I
have been especially concerned about the importance of balancing the
need for resource development with preserving a clean environment, and
have taken numerous actions to foster this goal. In the agricultural
area, I have taken the steps needed to improve farm incomes and to
increase our agricultural production to record levels. That progress
must be continued in the 1980’s.
ENVIRONMENT
Preserving the quality of our environment has been among the most
important objectives of my Administration and of the Congress. As a
result of these shared commitments and the dedicated efforts of many
members of the Congress and my Administration, we have achieved several
historic accomplishments.
PROTECTION OF ALASKA LANDS
Passage of the Alaska National Interest Lands Conservation Act was one
of the most important conservation actions of this century. At stake was
the fate of millions of acres of beautiful land, outstanding and unique
wildlife populations, native cultures, and the opportunity to ensure
that future generations of Americans would be able to enjoy the benefits
of these nationally significant resources. As a result of the
leadership, commitment, and persistence of my Administration and the
Congressional leadership, the Alaska Lands Bill was signed into law last
December.
The Act adds 97 million acres of new parks and refuges, more than
doubling the size of our National Park and National Wildlife Refuge
Systems. The bill triples the size of our national wilderness system,
increasing its size by 56 million acres. And by adding 25 free-flowing
river segments to the Wild and Scenic River System, the bill almost
doubles the river mileage in that system. The Alaska Lands Act reaffirms
our commitment to the environment and strikes a balance between
protecting areas of great beauty and allowing development of Alaska’s
oil, gas, mineral, and timber resources.
PROTECTION OF NATURAL RESOURCES
In addition to the Alaska Lands Act, over the past four years we have
been able to expand significantly the national wilderness and parks
systems. In 1978, the Congress passed the historical Omnibus Parks Act,
which made 12 additions to the National Park System. The Act also
established the first two national trails since the National Trails
System Act was passed in 1968. Then, in 1980, as a result of my 1979
Environmental Message, the Federal land management agencies have
established almost 300 new National Recreational Trails. With the
completion of the RARE II process, which eliminated the uncertainty
surrounding the status of millions of acres of land, we called for over
15 million acres of new wilderness in the nation’s National Forest, in
1980 the Congress established about 4.5 million acres of wilderness in
the lower 48 states. In addition, the Administration recommended
legislation to protect Lake Tahoe, and through an Executive Order has
already established a mechanism to help ensure the Lake’s protection.
Finally, in 1980 the Administration established the Channel Islands
Marine Sanctuary.
Administration actions over the past four years stressed the importance
of providing Federal support only for water resource projects that are
economically and environmentally sound. This policy should have a major
and lasting influence on the federal government’s role in water resource
development and management. The Administration’s actions to recommend to
the Congress only economically and environmentally sound water resource
projects for funding resulted not only in our opposing uneconomic
projects but also, in 1979, in the first Administration proposal of new
project starts in 4 years.
One of the most significant water policy actions of the past four years
was the Administration’s June 6, 1978 Water Policy Reform Message to the
Congress. This Message established a new national water resources policy
with the following objectives:
--to give priority emphasis to water conservation;
--to consider environmental requirements and values more fully and along
with economic factors in the planning and management of water projects
and programs;
--to enhance cooperation between state and federal agencies in water
resources planning and management.
In addition, the Executive Office of the President established 11 policy
decision criteria to evaluate the proposed federal water projects, the
Water Resources Council developed and adopted a new set of Principles
and Standards for water projects which is binding on all federal
construction agencies, and improved regulations were developed to
implement the National Historic Preservation Act and the Fish and
Wildlife Coordination Act. As a result, water resource projects must be
determined to be economically sound before the Administration will
recommend authorization or appropriation. Over the years ahead, this
policy will help to reduce wasteful federal spending by targeting
federal funds to the highest priority water resource projects.
In the pursuit of this policy, however, we cannot lose projects. In the
part that sound water resource projects play in providing irrigation,
power, and flood control. We must also recognize the special needs of
particular regions of the country in evaluating the need for additional
projects.
ADDRESSING GLOBAL RESOURCE AND ENVIRONMENTAL PROBLEMS
The Global 2000 Report to the President, prepared in response to my 1977
Environment Message, is the first of its kind. Never before has our
government, or any government, taken such a comprehensive, long-range
look at the interrelated global issues of resources, population, and
environment.
The Report’s conclusions are important. They point to a rapid increase
in population and human needs through the year 2000 while at the same
time a decline in the earth’s capacity to meet those needs, unless
nations of the world act decisively to alter current trends.
The United States has contributed actively to a series of U.N.
conferences on the environment, population, and resources, and is
preparing for the 1981 Conference on New and Renewable Sources of
Energy. Following my 1977 Environmental Message, the Administration
development assistance programs have added emphasis to natural resource
management and environmental protection. My 1979 Environmental Message
called attention to the alarming loss of world forests, particularly in
the tropics. An interagency task force on tropical forests has developed
a U.S. government program to encourage conservation and wise management
of tropical forests. The Administration is encouraging action by other
nations and world organizations to the same purpose. The United States
is a world leader in wildlife conservation and the assessment of
environmental effects of government actions. The January 5, 1979,
Executive Order directing U.S. government agencies to consider the
effects of their major actions abroad, is another example of this
leadership.
COMMITMENT TO CONTROL OF POLLUTION AND HAZARDOUS CHEMICALS
Over the past four years, there has been steady progress towards cleaner
air and water, sustained by the commitment of Congress and the
Administration to these important national objectives. In addition, the
Administration has developed several new pollution compliance approaches
such as alternative and innovative waste water treatment projects, the
“bubble” concept, the “offset” policy, and permit consolidation, all of
which are designed to reduce regulatory burdens on the private sector.
One of the most pressing problems to come to light in the past four
years has been improper hazardous waste disposal. The Administration has
moved on three fronts. First, we proposed the Oil Hazardous Substances
and Hazardous Waste Response, Liability and Compensation Act (the
Superfund bill) to provide comprehensive authority and $1.6 billion in
funds to clean up abandoned hazardous waste disposal sites. In November
1980 the Congress passed a Superfund bill which I signed into law.
Second, the administration established a hazardous waste enforcement
strike force to ensure that when available, responsible parties are
required to clean up sites posing dangers to public health and to the
environment. To date, 50 lawsuits have been brought by the strike force.
Third, regulations implementing subtitle C of the Resource Conservation
and Recovery Act were issued. The regulations establish comprehensive
controls for hazardous waste and, together with vigorous enforcement,
will help to ensure that Love Canal will not be repeated.
THE FUTURE
For the future, we cannot, and we must not, forget that we are charged
with the stewardship of an irreplaceable environment and natural
heritage. Our children, and our children’s children, are dependent upon
our maintaining our commitment to preserving and enhancing the quality
of our environment. It is my hope that when our descendants look back on
the 1980’s they will be able to affirm:
--that we kept our commitment to the restoration of environmental
quality;
--that we protected the public health from the continuing dangers of
toxic chemicals, from pollution, from hazardous and radioactive waste,
and that we made our communities safer, healthier and better places to
live;
--that we preserved America’s wilderness areas and particularly its last
great frontier, Alaska, for the benefit of all Americans in perpetuity;
--that we put this nation on a path to a sustainable energy future, one
based increasingly on renewable resources and on energy conservation;
--that we moved to protect America’s countryside and coastland from
mismanagement and irresponsibility;
--that we redirected the management of the nation’s water resources
toward water conservation, sound development and environmental
protection;
--that we faced squarely such worldwide problems as the destruction of
forests, acid rain, carbon dioxide build-up and nuclear proliferation;
and
--that we protected the habitat and the existence of our own species on
this earth.
AGRICULTURE THE FARM ECONOMY
The farm economy is sound and its future is bright. Agriculture remains
a major bulwark of the nation’s economy and an even more important
factor in the world food system. The demand for America’s agricultural
abundance, here and abroad, continues to grow. In the near-term, the
strength of this demand is expected to press hard against supplies,
resulting in continued price strength.
The health and vitality of current-day agriculture represents a
significant departure from the situation that existed when I came to
office four years ago. In January 1977, the farm economy was in serious
trouble. Farm prices and farm income were falling rapidly. Grain prices
were at their lowest levels in years and steadily falling. Livestock
producers, in their fourth straight year of record losses, were
liquidating breeding herds at an unparalleled rate. Dairy farmers were
losing money on every hundredweight of milk they produced. Sugar prices
were in a nosedive.
Through a combination of improvements in old, established programs and
the adoption of new approaches where innovation and change were needed,
my Administration turned this situation around. Commodity prices have
steadily risen. Farm income turned upward. U.S. farm exports set new
records each year, increasing over 80 percent for the four year period.
Livestock producers began rebuilding their herds. Dairy farmers began to
earn a profit again.
RECENT POLICY INITIATIVES
Several major agricultural policy initiatives have been undertaken over
the past year. Some are the culmination of policy proposals made earlier
in this Administration; others are measures taken to help farmers offset
the impact of rapid inflation in production costs. In combination, they
represent a significant strengthening of our nation’s food and
agricultural policy. These initiatives include:
FOOD SECURITY RESERVE
The Congress authorized formation of a 4 million ton food grain reserve
for use in international food assistance. This reserve makes it possible
for the United States to stand behind its food aid commitment to food
deficit nations, even during periods of short supplies and high prices.
This corrects a serious fault in our past food assistance policy.
COMPREHENSIVE CROP INSURANCE
The Congress also authorized a significant new crop insurance program
during 1980. This measure provides farmers with an important new program
tool for sharing the economic risks that are inherent to agriculture.
When fully operational, it will replace a hodgepodge of disaster
programs that suffered from numerous shortcomings.
SPECIAL LOAN RATES
Another legislative measure passed late in the 2nd session of the 96th
Congress authorizes the Secretary of Agriculture to provide higher loan
rates to farmers who enter their grain in the farmer-owned grain
reserve. This additional incentive to participate will further
strengthen the reserve.
INCREASED LOAN PRICES
In July 1980, I administratively raised loan prices for wheat,
feedgrains, and soybeans to help offset the effects of a serious
cost-price squeeze. At the same time, the release and call prices for
the grain reserve were adjusted upward.
HIGHER TARGET PRICES
The Agricultural Adjustment Act of 1980 raised the target prices for
1980-crop wheat and feed grain crops. This change corrected for
shortcomings in the adjustment formula contained in the Food and
Agriculture Act of 1977.
FUTURE AGENDA
The food and agricultural policies adopted by this Administration over
the past four years, including those described above, will provide a
firm foundation for future governmental actions in this field.
Expiration of the Food and Agriculture Act of 1977 later this year will
require early attention by the Congress. With relatively minor changes,
most of the authorities contained in the 1977 Act should be extended in
their present form. The farmer-owned grain reserve has proven to be a
particularly effective means of stabilizing grain markets and should be
preserved in essentially its present form.
Beyond this, it will be important for the Congress to keep a close eye
on price-cost developments in the farm sector. As noted above, some of
the actions I took last year were for the purpose of providing relief
from the cost-price squeeze facing farmers. Should these pressures
continue, further actions might be required.
My Administration has devoted particular attention to the issues of
world hunger, agricultural land use, and the future structure of
American agriculture. I encourage the Congress and the next
Administration to review the results of these landmark enquiries and,
where deemed appropriate, to act on their recommendations.
Following a careful review of the situation, I recently extended the
suspension of grain sales to the Soviet Union. I am satisfied that this
action has served its purpose effectively and fairly. However, as long
as this suspension must remain in effect, it will be important for the
next Administration and the Congress to take whatever actions are
necessary to ensure that the burden does not fall unfairly on our
Nation’s farmers. This has been a key feature of my Administration’s
policy, and it should be maintained.
VII. FOREIGN POLICY
From the time I assumed office four years ago this month, I have
stressed the need for this country to assert a leading role in a world
undergoing the most extensive and intensive change in human history.
My policies have been directed in particular at three areas of change:
--the steady growth and increased projection abroad of Soviet military
power, power that has grown faster than our own over the past two
decades.
--the overwhelming dependence of Western nations, which now increasingly
includes the United States, on vital oil supplies from the Middle East.
--the pressures of change in many nations of the developing world, in
Iran and uncertainty about the future stability of many developing
countries.
As a result of those fundamental facts, we face some of the most serious
challenges in the history of this nation. The Soviet invasion of
Afghanistan is a threat to global peace, to East-West relations, and to
regional stable flow of oil. As the unprecedented relations, an and
overwhelming vote in the General Assembly demonstrated, countries across
the world, and particularly the nonaligned, regard the Soviet invasion
as a threat to their independence and security. Turmoil within the
region adjacent to the Persian Gulf poses risks for the security and
prosperity of every oil importing nation and thus for the entire global
economy. The continuing holding of American hostages in Iran is both an
affront to civilized people everywhere, and a serious impediment to
meeting the self-evident threat to widely-shared common interests,
including those of Iran.
But as we focus our most urgent efforts on pressing problems, we will
continue to pursue the benefits that only change can bring. For it
always has been the essence of America that we want to move on, we
understand that prosperity, progress and most of all peace cannot be had
by standing still. A world of nations striving to preserve their
independence, and of peoples aspiring for economic development and
political freedom, is not a world hostile to the ideals and interests of
the United States. We face powerful adversaries, but we have strong
friends and dependable allies. We have common interests with the vast
majority of the world’s nations and peoples.
There have been encouraging developments in recent years, as well as
matters requiring continued vigilance and concern:
--Our alliances with the world’s most advanced and democratic states
from Western Europe through Japan are stronger than ever.
--We have helped to bring about a dramatic improvement in relations
between Egypt and Israel and an historic step towards a comprehensive
Arab-Israeli settlement.
--Our relations with China are growing closer, providing a major new
dimension in our policy in Asia and the world.
--Across southern Africa from Rhodesia to Namibia we are helping with
the peaceful transition to majority rule in a context of respect for
minority as well as majority rights.
--We have worked domestically and with our allies to respond to an
uncertain energy situation by conservation and diversification of energy
supplies based on internationally agreed targets.
--We have unambiguously demonstrated our commitment to defend Western
interests in Southwest Asia, and we have significantly increased our
ability to do so.
--And over the past four years the U.S. has developed an energy program
which is comprehensive and ambitious. New institutions have been
established such as the Synthetic Fuels Corporation and Solar Bank.
Price decontrol for oil and gas is proceeding. American consumers have
risen to the challenge, and we have experienced real improvements in
consumption patterns.
The central challenge for us today is to our steadfastedness of purpose.
We are no longer tempted by isolationism. But we must also learn to deal
effectively with the contradictions of the world, the need to cooperate
with potential adversaries without euphoria, without undermining our
determination to compete with such adversaries and if necessary confront
the threats they may pose to our security.
We face a broad range of threats and opportunities. We have and should
continue to pursue a broad range of defense, diplomatic and economic
capabilities and objectives.
I see six basic goals for America in the world over the 1980’s:
--First, we will continue, as we have over the past four years, to build
America’s military strength and that of our allies and friends. Neither
the Soviet Union nor any other nation will have reason to question our
will to sustain the strongest and most flexible defense forces.
--Second, we will pursue an active diplomacy in the world, working,
together with our friends and allies, to resolve disputes through
peaceful means and to make any aggressor pay a heavy price.
--Third, we will strive to resolve pressing international economic
problems, particularly energy and inflation, and continue to pursue our
still larger objective of global economic growth through expanded trade
and development assistance and through the preservation of an open
multilateral trading system.
--Fourth, we will continue vigorously to support the process of building
democratic institutions and improving human rights protection around the
world. We are deeply convinced that the future lies not with
dictatorship but democracy.
--Fifth, we remain deeply committed to the process of mutual and
verifiable arms control, particularly to the effort to prevent the
spread and further development of nuclear weapons. Our decision to
defer, but not abandon our efforts to secure ratification of the SALT II
Treaty reflects our firm conviction that the United States has a
profound national security interest in the constraints on Soviet nuclear
forces which only that treaty can provide.
--Sixth, we must continue to look ahead in order to evaluate and respond
to resource, environment and population challenges through the end of
this century.
One very immediate and pressing objective that is uppermost on our minds
and those of the American people is the release of our hostages in Iran.
We have no basic quarrel with the nation, the revolution or the people
of Iran. The threat to them comes not from American policy but from
Soviet actions in the region. We are prepared to work with the
government of Iran to develop a new and mutually beneficial
relationship.
But that will not be possible so long as Iran continues to hold
Americans hostages, in defiance of the world community and civilized
behavior. They must be released unharmed. We have thus far pursued a
measured program of peaceful diplomatic and economic steps in an attempt
to resolve this issue without resorting to other remedies available to
us under international law. This reflects the deep respect of our nation
for the rule of law and for the safety of our people being held, and our
belief that a great power bears a responsibility to use its strength in
a measured and judicious manner. But our patience is not unlimited and
our concern for the well-being of our fellow citizens grows each day.
ENHANCING NATIONAL SECURITY, AMERICAN MILITARY STRENGTH
The maintenance of national security is my first concern, as it has been
for every president before me.
We must have both the military power and the political will to deter our
adversaries and to support our friends and allies.
We must pay whatever price is required to remain the strongest nation in
the world. That price has increased as the military power of our major
adversary has grown and its readiness to use that power been made all
too evident in Afghanistan. The real increases in defense spending,
therefore probably will be higher than previously projected; protecting
our security may require a larger share of our national wealth in the
future.
THE U.S.-SOVIET RELATIONSHIP
We are demonstrating to the Soviet Union across a broad front that it
will pay a heavy price for its aggression in terms of our relationship.
Throughout the last decades U.S.-Soviet relations have been a mixture of
cooperation and competition. The Soviet invasion of Afghanistan and the
imposition of a puppet government have highlighted in the starkest terms
the darker side of their policies, going well beyond competition and the
legitimate pursuit of national interest, and violating all norms of
international law and practice.
This attempt to subjugate an independent, non-aligned Islamic people is
a callous violation of international law and the United Nations Charter,
two fundamentals of international order. Hence, it is also a dangerous
threat to world peace. For the first time since the communization of
Eastern Europe after World War II, the Soviets have sent combat forces
into an area that was not previously under their control, into a
non-aligned and sovereign state.
The destruction of the independence of the Afghanistan government and
the occupation by the Soviet Union have altered the strategic situation
in that part of the world in a very ominous fashion. It has
significantly shortened the striking distance to the Indian Ocean and
the Persian Gulf for the Soviet Union.
It has also eliminated a buffer between the Soviet Union and Pakistan
and presented a new threat to Iran. These two countries are now far more
vulnerable to Soviet political intimidation. If that intimidation were
to prove effective, the Soviet Union could control an area of vital
strategic and economic significance to the survival of Western Europe,
the Far East, and ultimately the United States.
It has now been over a year since the Soviet invasion of Afghanistan
dealt a major blow to U.S.-Soviet relations and the entire international
system. The U.S. response has proven to be serious and far-reaching. It
has been increasingly effective, imposing real and sustained costs on
the U.S.S.R.’s economy and international image.
Meanwhile, we have encouraged and supported efforts to reach a political
settlement in Afghanistan which would lead to a withdrawal of Soviet
forces from that country and meet the interests of all concerned. It is
Soviet intransigence that has kept those efforts from bearing fruit.
Meanwhile, an overwhelming November resolution of the United Nations
General Assembly on Afghanistan has again made clear that the world has
not and will not forget Afghanistan. And our response continues to make
it clear that Soviet use of force in pursuit of its international
objectives is incompatible with the notion of business-as-usual.
BILATERAL COMMUNICATION
U.S.-Soviet relations remain strained by the continued Soviet presence
in Afghanistan, by growing Soviet military capabilities, and by the
Soviets’ apparent willingness to use those capabilities without respect
for the most basic norms of international behavior.
But the U.S.-Soviet relationship remains the single most important
element in determining whether there will be war or peace. And so,
despite serious strains in our relations, we have maintained a dialogue
with the Soviet Union over the past year. Through this dialogue, we have
ensured against bilateral misunderstandings and miscalculations which
might escalate out of control, and have managed to avoid the injection
of superpower rivalries into areas of tension like the Iran-Iraq
conflict.
POLAND
Now, as was the case a year ago, the prospect of Soviet use of force
threatens the international order. The Soviet Union has completed
preparations for a possible military intervention against Poland.
Although the situation in Poland has shown signs of stabilizing
recently, Soviet forces remain in a high state of readiness and they
could move into Poland on short notice. We continue to believe that the
Polish people should be allowed to work out their internal problems
themselves, without outside interference, and we have made clear to the
Soviet leadership that any intervention in Poland would have severe and
prolonged consequences for East-West detente, and U.S.-Soviet relations
in particular.
DEFENSE BUDGET
For many years the Soviets have steadily increased their real defense
spending, expanded their strategic forces, strengthened their forces in
Europe and Asia, and enhanced their capability for projecting military
force around the world directly or through the use of proxies.
Afghanistan dramatizes the vastly increased military power of the Soviet
Union.
The Soviet Union has built a war machine far beyond any reasonable
requirements for their own defense and security. In contrast, our own
defense spending declined in real terms every year from 1968 through
1976.
We have reversed this decline in our own effort. Every year since 1976
there has been a real increase in our defense spending, and our lead has
encouraged increases by our allies. With the support of the Congress, we
must and will make an even greater effort in the years ahead.
The Fiscal Year 1982 budget would increase funding authority for defense
to more than $196 billion. This amount, together with a supplemental
request for FY 1981 of about $6 billion, will more than meet my
Administration’s pledge for a sustained growth of 3 percent in real
expenditures, and provides for 5 percent in program growth in FY 1982
and beyond.
The trends we mean to correct cannot be remedied overnight; we must be
willing to see this program through. To ensure that we do so I am
setting a growth rate for defense that we can sustain over the long
haul.
The defense program I have proposed for the next five years will require
some sacrifice, but sacrifice we can well afford.
The defense program emphasizes four areas:
1. It ensures that our strategic nuclear forces will be equivalent to
those of the Soviet Union and that deterrence against nuclear war will
be maintained; 2. It upgrades our forces so that the military balance
between NATO and the Warsaw Pact will continue to deter the outbreak of
war, conventional or nuclear, in Europe; 3. It provides us the ability
to come quickly to the aid of friends and allies around the globe; 4.
And it ensures that our Navy will continue to be the most powerful on
the seas.
STRATEGIC FORCES
We are strengthening each of the three legs of our strategic forces. The
cruise missile production which will begin next year will modernize our
strategic air deterrent. B-52 capabilities will also be improved. These
steps will maintain and enhance the B-52 fleet by improving its ability
to deliver weapons against increasingly heavily defended targets.
We are also modernizing our strategic submarine force. Four more
POSEIDON submarines backfitted with new, 4,000 mile TRIDENT I missiles
began deployments in 1980. Nine TRIDENT submarines have been authorized
through 1981, and we propose one more each year.
The new M-X missile program to enhance our land-based intercontinental
ballistic missile force continues to make progress. Technical
refinements in the basing design over the last year will result in
operational benefits, lower costs, and reduced environmental impact. The
M-X program continues to be an essential ingredient in our strategic
posture, providing survivability, endurance, secure command and control
and the capability to threaten targets the Soviets hold dear.
Our new systems will enable U.S. strategic forces to maintain
equivalence in the face of the mounting Soviet challenge. We would
however need an even greater investment in strategic systems to meet the
likely Soviet buildup without SALT.
STRATEGIC DOCTRINE
This Administration’s systematic contributions to the necessary
evolution of strategic doctrine began in 1977 when I commissioned a
comprehensive net assessment. From that base a number of thorough
investigations of specific topics continued. I should emphasize that the
need for an evolutionary doctrine is driven not by any change in our
basic objective, which remains peace and freedom for all mankind.
Rather, the need for change is driven by the inexorable buildup of
Soviet military power and the increasing propensity of Soviet leaders to
use this power in coercion and outright aggression to impose their will
on others.
I have codified our evolving strategic doctrine in a number of
interrelated and mutually supporting Presidential Directives. Their
overarching theme is to provide a doctrinal basis, and the specific
program to implement it, that tells the world that no potential
adversary of the United States could ever conclude that the fruits of
his aggression would be significant or worth the enormous costs of our
retaliation.
The Presidential Directives include:
PD-18: An overview of our strategic objectives PD-37: Basic space policy
PD-41: Civil Defense PD-53: Survivability and endurance for
telecommunications PD-57: Mobilization planning PD-58: Continuity of
Government PD-59: Countervailing Strategy for General War.
These policies have been devised to deter, first and foremost, Soviet
aggression. As such they confront not only Soviet military forces but
also Soviet military doctrine. By definition deterrence requires that we
shape Soviet assessments about the risks of war, assessments they will
make using their doctrine, not ours.
But at the same time we in no way seek to emulate their doctrine. In
particular, nothing in our policy contemplates that nuclear warfare
could ever be a deliberate instrument for achieving our own goals of
peace and freedom. Moreover, our policies are carefully devised to
provide the greatest possible incentives and opportunities for future
progress in arms control.
Finally, our doctrinal evolution has been undertaken with appropriate
consultation with our NATO Allies and others. We are fully consistent
with NATO’s strategy of flexible response.
FORCES FOR NATO
We are greatly accelerating our ability to reinforce Western Europe with
massive ground and air forces in a crisis. We are undertaking a major
modernization program for the Army’s weapons and equipment, adding
armor, firepower, and tactical mobility.
We are prepositioning more heavy equipment in Europe to help us cope
with attacks with little warning, and greatly strengthening our airlift
and sealift capabilities.
We are also improving our tactical air forces, buying about 1700 new
fighter and attack aircraft over the next five years, and increasing the
number of Air Force fighter wings by over 10 percent.
We are working closely with our European allies to secure the Host
Nation Support necessary to enable us to deploy more quickly a greater
ratio of combat forces to the European theater at a lower cost to the
United States.
SECURITY ASSISTANCE
As we move to enhance U.S. defense capabilities, we must not lose sight
of the need to assist others in maintaining their own security and
independence. Events since World War II, most recently in Southwest
Asia, have amply demonstrated that U.S. security cannot exist in a
vacuum, and that our own prospects for peace are closely tied to those
of our friends. The security assistance programs which I am proposing
for the coming fiscal year thus directly promote vital U.S. foreign
policy and national security aims, and are integral parts of our efforts
to improve and upgrade our own military forces.
More specifically, these programs, which are part of our overall foreign
aid request, promote U.S. security in two principal ways. First, they
assist friendly and allied nations to develop the capability to defend
themselves and maintain their own independence. An example during this
past year was the timely support provided Thailand to help bolster that
country’s defenses against the large numbers of Soviet-backed Vietnamese
troops ranged along its eastern frontier. In addition, over the years
these programs have been important to the continued independence of
other friends and allies such as Israel, Greece, Turkey and Korea.
Second, security assistance constitutes an essential element in the
broad cooperative relationships we have established with many nations
which permit either U.S. bases on their territory or access by U.S.
forces to their facilities. These programs have been particularly
important with regard to the recently-concluded access agreements with
various countries in the Persian Gulf and Indian Ocean regions and have
been crucial to the protection of our interests throughout Southwest
Asia.
RAPID DEPLOYMENT FORCES
We are systematically enhancing our ability to respond rapidly to
non-NATO contingencies wherever required by our commitments or when our
vital interests are threatened.
The rapid deployment forces we are assembling will be extraordinarily
flexible: They could range in size from a few ships or air squadrons to
formations as large as 100,000 men, together with their support. Our
forces will be prepared for rapid deployment to any region of strategic
significance.
Among the specific initiatives we are taking to help us respond to
crises outside of Europe are:
The development of a new fleet of large cargo aircraft with
intercontinental range; the design and procurement of a force of
Maritime Prepositioning Ships that will carry heavy equipment and
supplies for three Marine Corps brigades; the procurement of fast
sealift ships to move large quantities of men and material quickly from
the U.S. to overseas areas of deployment; increasing training and
exercise activities to ensure that our forces will be well prepared to
deploy and operate in distant areas.
In addition, our European allies have agreed on the importance of
providing support to U.S. deployments to Southwest Asia.
NAVAL FORCES
Seapower is indispensable to our global position, in peace and also in
war. Our shipbuilding program will sustain a 550-ship Navy in the 1990’s
and we will continue to build the most capable ships afloat.
The program I have proposed will assure the ability of our Navy to
operate in high threat areas, to maintain control of the seas and
protect vital lines of communication, both military and economic and to
provide the strong maritime component of our rapid deployment forces.
This is essential for operations in remote areas of the world, where we
cannot predict far in advance the precise location of trouble, or
preposition equipment on land.
MILITARY PERSONNEL
No matter how capable or advanced our weapons systems, our military
security depends on the abilities, the training and the dedication of
the people who serve in our armed forces. I am determined to recruit and
to retain under any foreseeable circumstances an ample level of such
skilled and experienced military personnel. This Administration has
supported for FY 1981 the largest peacetime increase ever in military
pay and allowances.
We have enhanced our readiness and combat endurance by improving the
Reserve Components. All reservists are assigned to units structured to
complement and provide needed depth to our active forces. Some reserve
personnel have also now been equipped with new equipment.
MOBILIZATION PLANNING
We have completed our first phase of mobilization planning, the first
such Presidentially-directed effort since World War II. The
government-wide exercise of our mobilization plans at the end of 1980
showed, first, that planning pays off and, second, that much more needs
to be done.
OUR INTELLIGENCE POSTURE
Our national interests are critically dependent on a strong and
effective intelligence capability. We will maintain and strengthen the
intelligence capabilities needed to assure our national security.
Maintenance of and continued improvements in our multi-faceted
intelligence effort are essential if we are to cope successfully with
the turbulence and uncertainties of today’s world.
The intelligence budget I have submitted to the Congress responds to our
needs in a responsible way, providing for significant growth over the
Fiscal Year 1981 budget. This growth will enable us to develop new
technical means of intelligence collection while also assuring that the
more traditional methods of intelligence work are also given proper
stress. We must continue to integrate both modes of collection in our
analyses.
REGIONAL POLICIES
Every President for over three decades has recognized that America’s
interests are global and that we must pursue a global foreign policy.
Two world wars have made clear our stake in Western Europe and the North
Atlantic area. We are also inextricably linked with the Far East,
politically, economically, and militarily. In both of these, the United
States has a permanent presence and security commitments which would be
automatically triggered. We have become increasingly conscious of our
growing interests in a third area, the Middle East and the Persian Gulf
area.
We have vital stakes in other major regions of the world as well. We
have long recognized that in an era of interdependence, our own security
and prosperity depend upon a larger common effort with friends and
allies throughout the world.
THE ATLANTIC ALLIANCE
In recognition of the threat which the Soviet invasion of Afghanistan
posed to Western interests in both Europe and Southwest Asia, NATO
foreign and defense ministers have expressed full support for U.S.
efforts to develop a capability to respond to a contingency in Southwest
Asia and have approved an extensive program to help fill the gap which
could be created by the diversion of U.S. forces to that region.
The U.S. has not been alone in seeking to maintain stability in the
Southwest Asia area and insure access to the needed resources there. The
European nations with the capability to do so are improving their own
forces in the region and providing greater economic and political
support to the residents of the area. In the face of the potential
danger posed by the Iran-Iraq conflict, we have developed coordination
among the Western forces in the area of the Persian Gulf in order to be
able to safeguard passage in that essential waterway.
Concerning developments in and around Poland the allies have achieved
the highest level of cohesion and unity of purpose in making clear the
effects on future East-West relations of a precipitous Soviet act there.
The alliance has continued to build on the progress of the past three
years in improving its conventional forces through the Long-Term Defense
Program. Though economic conditions throughout Europe today are making
its achievement difficult, the yearly real increase of 3 percent in
defense spending remains a goal actively sought by the alliance.
The NATO alliance also has moved forward during the past year with the
implementation of its historic December 1979 decision to modernize its
Theater Nuclear Force capabilities through deployment of improved
Pershing ballistic missiles and ground-launched cruise missiles in
Europe. Our allies continue to cooperate actively with us in this
important joint endeavor, whose purpose is to demonstrate convincingly
to the Soviet Union the potential costs of a nuclear conflict in Europe.
At the same time, we offered convincing evidence of our commitment to
arms control in Europe by initiating preliminary consultations with the
Soviet Union in Geneva on the subject of negotiated limits on long-range
theater nuclear forces. Also, during 1980 we initiated and carried out a
withdrawal from our nuclear weapons stockpile in Europe of 1,000 nuclear
warheads. This successful drawdown in our nuclear stockpile was a
further tangible demonstration of our commitment to the updating of our
existing theater nuclear forces in Europe.
In the NATO area, we continued to work closely with other countries in
providing resources to help Turkey regain economic health. We regretted
that massive political and internal security problems led the Turkish
military to take over the government on September 12. The new Turkish
authorities are making some progress in resolving those problems, and
they have pledged an early return to civilian government. The tradition
of the Turkish military gives us cause to take that pledge seriously. We
welcomed the reestablishment of Greece’s links to the integrated
military command structure of the Atlantic Alliance--a move which we had
strongly encouraged--as a major step toward strengthening NATO’s vital
southern flank at a time of international crisis and tension in adjacent
areas. Greek reintegration exemplifies the importance which the allies
place on cooperating in the common defense and shows that the allies can
make the difficult decisions necessary to insure their continued
security. We also welcomed the resumption of the intercommunal talks on
Cyprus.
THE U.S. AND THE PACIFIC NATIONS
The United States is a Pacific nation, as much as it is an Atlantic
nation. Our interests in Asia are as important to us as our interests in
Europe. Our trade with Asia is as great as our trade with Europe. During
the past four years we have regained a strong, dynamic and flexible
posture for the United States in this vital region.
Our major alliances with Japan, Australia and New Zealand are now
stronger than they ever have been, and together with the nations of
western Europe, we have begun to form the basic political structure for
dealing with international crises that affect us all. Japan, Australia
and New Zealand have given us strong support in developing a strategy
for responding to instability in the Persian Gulf.
Normalization of U.S. relations with China has facilitated China’s full
entry into the international community and encouraged a constructive
Chinese role in the Asia-Pacific region. Our relations with China have
been rapidly consolidated over the past year through the conclusion of a
series of bilateral agreements. We have established a pattern of
frequent and frank consultations between our two governments,
exemplified by a series of high-level visits and by regular exchanges at
the working level, through which we have been able to identify
increasingly broad areas of common interest on which we can cooperate.
United States relations with the Association of Southeast Asian Nations
(ASEAN) have also expanded dramatically in the past four years. ASEAN is
now the focus for U.S. policy in Southeast Asia, and its cohesion and
strength are essential to stability in this critical area and beyond.
Soviet-supported Vietnamese aggression in Indo-china has posed a major
challenge to regional stability. In response, we have reiterated our
security commitment to Thailand and have provided emergency security
assistance for Thai forces facing a Vietnamese military threat along the
Thai-Cambodian border. We have worked closely with ASEAN and the U.N. to
press for withdrawal of Vietnamese forces from Cambodia and to encourage
a political settlement in Cambodia which permits that nation to be
governed by leaders of its own choice. We still look forward to the day
when Cambodia peacefully can begin the process of rebuilding its social,
economic and political institutions, after years of devastation and
occupation. And, on humanitarian grounds and in support of our friends
in the region, we have worked vigorously with international
organizations to arrange relief and resettlement for the exodus of
Indo-chinese refugees which threatened to overwhelm these nations.
We have maintained our alliance with Korea and helped assure Korea’s
security during a difficult period of political transition.
We have amended our military base agreement with the Philippines,
ensuring stable access to these bases through 1991. The importance of
our Philippine bases to the strategic flexibility of U.S. forces and our
access to the Indian Ocean is self-evident.
Finally, we are in the process of concluding a long negotiation
establishing Micronesia’s status as a freely associated state.
We enter the 1980’s with a firm strategic footing in East Asia and the
Pacific, based on stable and productive U.S. relations with the majority
of countries of the region. We have established a stable level of U.S.
involvement in the region, appropriate to our own interests and to the
interests of our friends and allies there.
THE MIDDLE EAST AND SOUTHWEST ASIA
The continuing Soviet occupation of Afghanistan and the dislocations
caused by the Iraq-Iran war serve as constant reminders of the critical
importance for us, and our allies, of a third strategic zone stretching
across the Middle East, the Persian Gulf, and much of the Indian
subcontinent. This Southwest Asian region has served as a key strategic
and commercial link between East and West over the centuries. Today it
produces two-thirds of the world’s oil exports, providing most of the
energy needs of our European allies and Japan. It has experienced almost
continuous conflict between nations, internal instabilities in many
countries, and regional rivalries, combined with very rapid economic and
social change. And now the Soviet Union remains in occupation of one of
these nations, ignoring world opinion which has called on it to get out.
We have taken several measures to meet these challenges.
MIDDLE EAST
In the Middle East, our determination to consolidate what has already
been achieved in the peace process--and to buttress that accomplishment
with further progress toward a comprehensive peace settlement--must
remain a central goal of our foreign policy. Pursuant to their peace
treaty, Egypt and Israel have made steady progress in the normalization
of their relations in a variety of fields, bringing the benefits of
peace directly to their people. The new relationship between Egypt and
Israel stands as an example of peaceful cooperation in an increasingly
fragmented and turbulent region.
Both President Sadat and Prime Minister Begin remain committed to the
current negotiations to provide full autonomy to the inhabitants of the
West Bank and Gaza. These negotiations have been complex and difficult,
but they have already made significant progress, and it is vital that
the two sides, with our assistance, see the process through to a
successful conclusion. We also recognize the need to broaden the peace
process to include other parties to the conflict and believe that a
successful autonomy agreement is an essential first step toward this
objective.
We have also taken a number of steps to strengthen our bilateral
relations with both Israel and Egypt. We share important strategic
interests with both of these countries.
We remain committed to Israel’s security and are prepared to take
concrete steps to support Israel whenever that security is threatened.
PERSIAN GULF
The Persian Gulf has been a vital crossroads for trade between Europe
and Asia at many key moments in history. It has become essential in
recent years for its supply of oil to the United States, our allies, and
our friends. We have taken effective measures to control our own
consumption of imported fuel, working in cooperation with the other key
industrial / nations of the world. However, there is little doubt that
the healthy growth of our American and world economies will depend for
many years on continued safe access to the Persian Gulf’s oil
production. The denial of these oil supplies would threaten not only our
own but world security.
The potent new threat from an advancing Soviet Union, against the
background of regional instability of which it can take advantage,
requires that we reinforce our ability to defend our regional friends
and to protect the flow of oil. We are continuing to build on the strong
political, economic, social and humanitarian ties which bind this
government and the American people to friendly governments and peoples
of the Persian Gulf.
We have also embarked on a course to reinforce the trust and confidence
our regional friends have in our ability to come to their assistance
rapidly with American military force if needed. We have increased our
naval presence in the Indian Ocean. We have created a Rapid Deployment
Force which can move quickly to the Gulf--or indeed any other area of
the world where outside aggression threatens. We have concluded several
agreements with countries which are prepared to let us use their
airports and naval facilities in an emergency. We have met requests for
reasonable amounts of American weaponry from regional countries which
are anxious to defend themselves. And we are discussing with a number of
our area friends further ways we can help to improve their security and
ours, both for the short and the longer term.
SOUTH ASIA
We seek a South Asia comprising sovereign and stable states, free of
outside interference, which can strengthen their political institutions
according to their own national genius and can develop their economies
for the betterment of their people.
The Soviet invasion of Afghanistan has posed a new challenge to this
region, and particularly to neighboring Pakistan. We are engaged in a
continuing dialogue with the Pakistan government concerning its
development and security requirements and the economic burden imposed by
Afghan refugees who have fled to Pakistan. We are participating with
other aid consortium members in debt rescheduling and will continue to
cooperate through the UNHCR in providing refugee assistance. We remain
committed to Pakistan’s territorial integrity and independence.
Developments in the broad South/Southwest Asian region have also lent a
new importance to our relations with India, the largest and strongest
power in the area. We share India’s interest in a more constructive
relationship. Indian policies and perceptions at times differ from our
own, and we have established a candid dialogue with this sister
democracy which seeks to avoid the misunderstandings which have
sometimes complicated our ties.
We attach major importance to strong economic assistance programs to the
countries in the area, which include a majority of the poor of the
non-Communist world. We believe that these programs will help achieve
stability in the area, an objective we share with the countries in the
region. Great progress has been achieved by these countries in
increasing food production; international cooperation in harnessing the
great river resources of South Asia would contribute further to this
goal and help to increase energy production.
We continue to give high priority to our non-proliferation goals in the
area in the context of our broad global and regional priorities. The
decision to continue supply of nuclear fuel to the Indian Tarapur
reactors was sensitive to this effort.
AFRICA
The United States has achieved a new level of trust and cooperation with
Africa. Our efforts, together with our allies, to achieve peace in
southern Africa, our increased efforts to help the poorest countries in
Africa to combat poverty, and our expanded efforts to promote trade and
investment have led to growing respect for the U.S. and to cooperation
in areas of vital interest to the United States.
Africa is a continent of poor nations for the most part. It also
contains many of the mineral resources vital for our economy. We have
worked with Africa in a spirit of mutual cooperation to help the African
nations solve their problems of poverty and to develop stronger ties
between our private sector and African economies. Our assistance to
Africa has more than doubled in the last four years. Equally important,
we set in motion new mechanisms for private investment and trade.
Nigeria is the largest country in Black Africa and the second largest
oil supplier to the United States. During this Administration we have
greatly expanded and improved our relationship with Nigeria and other
West African states whose aspirations for a constitutional democratic
order we share and support. This interest was manifested both
symbolically and practically by the visit of Vice President Mondale to
West Africa in July (1980) and the successful visit to Washington of the
President of Nigeria in October.
During Vice President Mondale’s visit, a Joint Agricultural Consultative
Committee was established, with the U.S. represented entirely by the
private sector. This could herald a new role for the American private
sector in helping solve the world’s serious food shortages. I am pleased
to say that our relations with Nigeria are at an all-time high,
providing the foundation for an even stronger relationship in the years
ahead.
Another tenet of this Administration’s approach to African problems has
been encouragement and support for regional solutions to Africa’s
problems. We have supported initiatives by the Organization of African
Unity to solve the protracted conflict in the western Sahara, Chad, and
the Horn. In Chad, the world is watching with dismay as a country torn
by a devastating civil war has become a fertile field for Libya’s
exploitation, thus demonstrating that threats to peace can come from
forces within as well as without Africa.
In southern Africa the United States continues to pursue a policy of
encouraging peaceful development toward majority rule. In 1980, Southern
Rhodesia became independent as Zimbabwe, a multiracial nation under a
system of majority rule. Zimbabwean independence last April was the
culmination of a long struggle within the country and diplomatic efforts
involving Great Britain, African states neighboring Zimbabwe, and the
United States.
The focus of our efforts in pursuit of majority rule in southern Africa
has now turned to Namibia. Negotiations are proceeding among concerned
parties under the leadership of U.N. Secretary General Waldheim. This
should lead to implementation of the U.N. plan for self-determination
and independence for Namibia during 1981. If these negotiations are
successfully concluded, sixty-five years of uncertainty over the status
of the territory, including a seven-year-long war, will be ended.
In response to our active concern with issues of importance to Africans,
African states have cooperated with us on issues of importance to our
national interests. African states voted overwhelmingly in favor of the
U.N. Resolution calling for release of the hostages, and for the U.N.
Resolution condemning the Soviet invasion of Afghanistan. Two countries
of Africa have signed access agreements with the U.S. allowing us use of
naval and air facilities in the Indian Ocean.
Africans have become increasingly vocal on human rights. African leaders
have spoken out on the issue of political prisoners, and the OAU is
drafting its own Charter on Human Rights. Three countries in Africa--
Nigeria, Ghana, and Uganda--have returned to civilian rule during the
past year.
U.S. cooperation with Africa on all these matters represents a strong
base on which we can build in future years.
Liberia is a country of long-standing ties with the U.S. and the site of
considerable U.S. investment and facilities. This past April a coup
replaced the government and a period of political and economic
uncertainty ensued. The U.S. acted swiftly to meet this situation. We,
together with African leaders, urged the release of political prisoners,
and many have been released; we provided emergency economic assistance
to help avoid economic collapse, and helped to involve the IMF and the
banking community to bring about economic stability; and we have worked
closely with the new leaders to maintain Liberia’s strong ties with the
West and to protect America’s vital interests.
NORTH AFRICA
In early 1979, following a Libyan-inspired commando attack on a Tunisian
provincial city, the U.S. responded promptly to Tunisia’s urgent request
for assistance, both by airlifting needed military equipment and by
making clear our longstanding interest in the security and integrity of
this friendly country. The U.S. remains determined to oppose other
irresponsible Libyan aspirations. Despairing of a productive dialogue
with the Libyan authorities, the U.S. closed down its embassy in Libya
and later expelled six Libyan diplomats in Washington in order to deter
an intimidation campaign against Libyan citizens in the U.S.
U.S. relations with Algeria have improved, and Algeria has played an
indispensable and effective role as intermediary between Iran and the
U.S. over the hostage issue.
The strengthening of our arms supply relationship with Morocco has
helped to deal with attacks inside its internationally recognized
frontiers and to strengthen its confidence in seeking a political
settlement of the Western Sahara conflict. While not assuming a
mediatory role, the U.S. encouraged all interested parties to turn their
energies to a peaceful and sensible compromise resolution of the war in
the Sahara and supported efforts by the Organization of African Unity
toward that end. As the year drew to a close, the U.S. was encouraged by
evolution in the attitudes of all sides, and is hopeful that their
differences will be peacefully resolved in the year ahead so that the
vast economic potential of North Africa can be developed for the
well-being of the people living there.
LATIN AMERICA AND THE CARIBBEAN
The principles of our policies in this hemisphere have been clear and
constant over the last four years. We support democracy and respect for
human rights. We have struggled with many to help free the region of
both repression and terrorism. We have respected ideological diversity
and opposed outside intervention in purely internal affairs. We will
act, though, in response to a request for assistance by a country
threatened by external aggression. We support social and economic
development within a democratic framework. We support the peaceful
settlement of disputes. We strongly encourage regional cooperation and
shared responsibilities within the hemisphere to all these ends, and we
have eagerly and regularly sought the advice of the leaders of the
region on a wide range of issues.
Last November, I spoke to the General Assembly of the Organization of
American States of a cause that has been closest to my heart--human
rights. It is an issue that has found its time in the hemisphere. The
cause is not mine alone, but an historic movement that will endure.
At Riobamba, Ecuador, last September four Andean Pact countries, Costa
Rica, and Panama broke new ground by adopting a “Code of Conduct,” that
joint action in defense of human rights does not violate the principles
of nonintervention in the internal affairs of states in this hemisphere.
The Organization of American States has twice condemned the coup that
overturned the democratic process in Bolivia and the widespread abuse of
human rights by the regime which seized power. The Inter-American
Commission on Human Rights has gained world acclaim for its
dispassionate reports. It completed two major country studies this year
in addition to its annual report. In a resolution adopted without
opposition, the OAS General Assembly in November strongly supported the
work of the Commission. The American Convention on Human Rights is in
force and an Inter-American Court has been created to judge human rights
violations. This convention has been pending before the Senate for two
years; I hope the United States this year will join the other nations of
the hemisphere in ratifying a convention which embodies principles that
are our tradition.
The trend in favor of democracy has continued. During this past year,
Peru inaugurated a democratically elected government. Brazil continues
its process of liberalization. In Central America, Hondurans voted in
record numbers in their first national elections in over eight years. In
the Caribbean seven elections have returned governments firmly committed
to the democratic traditions of the Commonwealth.
Another major contribution to peace in the hemisphere is Latin America’s
own Treaty for the Prohibition of Nuclear Weapons. On behalf of the
United States, I signed Protocol I of this Treaty in May of 1977 and
sent it to the Senate for ratification. I urge that it be acted upon
promptly by the Senate in order that it be brought into the widest
possible effect in the Latin American region.
Regional cooperation for development is gaining from Central America to
the Andes, and throughout the Caribbean. The Caribbean Group for
Cooperation in Economic Development, which we established with 29 other
nations in 1977, has helped channel $750 million in external support for
growth in the Caribbean. The recent meeting of the Chiefs of State of
the Eastern Caribbean set a new precedent for cooperation in that
region. Mexico and Venezuela jointly and Trinidad and Tobago separately
have established oil facilities that will provide substantial assistance
to their oil importing neighbors. The peace treaty between El Salvador
and Honduras will hopefully stimulate Central America to move forward
again toward economic integration. Formation of Caribbean/ Central
American Action, a private sector organization, has given a major
impetus to improving people-to-people bonds and strengthening the role
of private enterprise in the development of democratic societies.
The Panama treaties have been in force for over a year. A new
partnership has been created with Panama; it is a model for large and
small nations. A longstanding issue that divided us from our neighbors
has been resolved. The security of the canal has been enhanced. The
canal is operating as well as ever, with traffic through it reaching
record levels this year. Canal employees, American and Panamanian alike,
have remained on the job and have found their living and working
conditions virtually unchanged.
In 1980, relations with Mexico continued to improve due in large measure
to the effectiveness of the Coordinator for Mexican Affairs and the
expanded use of the U.S.-Mexico Consultative Mechanism. By holding
periodic meetings of its various working groups, we have been able to
prevent mutual concerns from becoming political issues. The Secretary of
State visited Mexico City in November, and, along with the Mexican
Secretary of Foreign Relations, reviewed the performance of the
Consultative Mechanism. The office of the Coordinator has ensured the
implementation of my directive to all agencies to accord high priority
to Mexican concerns. Trade with Mexico rose by almost 60 percent to
nearly $30 billion, making that country our third largest trading
partner.
These are all encouraging developments. Other problems remain, however.
The impact of large-scale migration is affecting many countries in the
hemisphere. The most serious manifestation was the massive, illegal
exodus from Cuba last summer. The Cuban government unilaterally
encouraged the disorderly and even deadly migration of 125,000 of its
citizens in complete disregard for international law or the immigration
laws of its neighbors. Migrations of this nature clearly require
concerted action, and we have asked the OAS to explore means of dealing
with similar situations which may occur in the future.
We have a long-standing treaty with Colombia on Quita Sueno, Roncador,
and Serrano which remains to be ratified by the Senate.
In Central America, the future of Nicaragua is unclear. Recent tensions,
the restrictions on the press and political activity, an inordinate
Cuban presence in the country and the tragic killing by the security
forces of a businessman well known for his democratic orientation, cause
us considerable concern. These are not encouraging developments. But
those who seek a free society remain in the contest for their nation’s
destiny. They have asked us to help rebuild their country, and by our
assistance, to demonstrate that the democratic nations do not intend to
abandon Nicaragua to the Cubans. As long as those who intend to pursue
their pluralistic goals play important roles in Nicaragua, it deserves
our continuing support.
In El Salvador, we have supported the efforts of the Junta to change the
fundamental basis of an inequitable system and to give a stake in a new
nation to those millions of people, who for so long, lived without hope
or dignity. As the government struggles against those who would restore
an old tyranny or impose a new one, the United States will continue to
stand behind them.
We have increased our aid to the Caribbean, an area vital to our
national security, and we should continue to build close relations based
on mutual respect and understanding, and common interests.
As the nations of this hemisphere prepare to move further into the
1980’s, I am struck by the depth of underlying commitment that there is
to our common principles: non-intervention, peaceful settlement of
disputes, cooperation for development, democracy and defense of basic
human rights. I leave office satisfied that the political, economic,
social and organizational basis for further progress with respect to all
these principles have been substantially strengthened in the past four
years. I am particularly reassured by the leadership by other nations of
the hemisphere in advancing these principles. The success of our common
task of improving the circumstances of all peoples and nations in the
hemisphere can only be assured by the sharing of responsibility. I look
forward to a hemisphere that at the end of this decade has proven itself
anew as a leader in the promotion of both national and human dignity.
THE INTERNATIONAL ECONOMY
A growing defense effort and a vigorous foreign policy rest upon a
strong economy here in the United States. And the strength of our own
economy depends upon our ability to lead and compete in the
international marketplace.
ENERGY
Last year, the war between Iraq and Iran led to the loss of nearly 4
million barrels of oil to world markets, the third major oil market
disruption in the past seven years. This crisis has vividly demonstrated
once again both the value of lessened dependence on oil imports and the
continuing instability of the Persian Gulf area.
Under the leadership of the United States, the 21 members of the
International Energy Agency took collective action to ensure that the
oil shortfall stemming from the Iran-Iraq war would not be aggravated by
competition for scarce spot market supplies. We are also working
together to see that those nations most seriously affected by the oil
disruption-- including our key NATO allies Turkey and Portugal--can get
the oil they need. At the most recent IEA Ministerial meeting we joined
the other members in pledging to take those policy measures necessary to
slice our joint oil imports in the first quarter of 1981 by 2.2 million
barrels.
Our international cooperation efforts in the energy field are not
limited to crisis management. At the Economic Summit meetings in Tokyo
and Venice, the heads of government of the seven major industrial
democracies agreed to a series of tough energy conservation and
production goals. We are working together with all our allies and
friends in this effort.
Construction has begun on a commercial scale coal liquefaction plant in
West Virginia co-financed by the United States, Japan and West Germany.
An interagency task force has just reported to me on a series of
measures we need to take to increase coal production and exports. This
report builds on the work of the International Energy Agency’s Coal
Industry Advisory Board. With the assurances of a reliable United States
steam coal supply at reasonable prices, many of the electric power
plants to be built in the 1980’s and 1990’s can be coal-fired rather
than oil-burning.
We are working cooperatively with other nations to increase energy
security in other areas as well. Joint research and development with our
allies is underway in solar energy, nuclear power, industrial
conservation and other areas. In addition, we are assisting rapidly
industrializing nations to carefully assess their basic energy policy
choices, and our development assistance program helps the developing
countries to increase indigenous energy production to meet the energy
needs of their poorest citizens. We support the proposal for a new World
Bank energy affiliate to these same ends, whose fulfillment will
contribute to a better global balance between energy supply and demand.
INTERNATIONAL MONETARY POLICY
Despite the rapid increase in oil costs, the policy measures we have
taken to improve domestic economic performance have had a continued
powerful effect on our external accounts and on the strength of the
dollar. A strong dollar helps in the fight against inflation.
There has also been considerable forward movement in efforts to improve
the functioning of the international monetary system. The stability of
the international system of payments and trade is important to the
stability and good health of our own economy. We have given strong
support to the innovative steps being taken by the International
Monetary Fund and World Bank to help promote early adjustment to the
difficult international economic problems. Recent agreement to increase
quotas by fifty percent will ensure the IMF has sufficient resources to
perform its central role in promoting adjustment and financing payments
imbalances. The World Bank’s new structural adjustment lending program
will also make an important contribution to international efforts to
help countries achieve a sustainable level of growth and development.
SUGAR
In 1980, Congress passed U.S. implementing legislation for the
International Sugar Agreement, thus fulfilling a major commitment of
this Administration. The agreement is an important element in our
international commodity policy with far-reaching implications for our
relations with developing countries, particularly sugar producers in
Latin America. Producers and consumers alike will benefit from a more
stable market for this essential commodity.
COFFEE
At year’s end, Congress approved implementing legislation permitting the
U.S. to carry out fully its commitments under International Coffee
Agreement Specifically, the legislation enables us to meet our part of
an understanding negotiated last fall among members of the Agreement,
which defends, by use of export quotas, a price range well below coffee
prices of previous years and which commits major coffee producers to
eliminate cartel arrangements that manipulated future markets to raise
prices. The way is now open to a fully-functioning International Coffee
Agreement which can help to stabilize this major world commodity market.
The results will be positive for both consumers--who will be less likely
to suffer from sharp increases in coffee prices--and producers--who can
undertake future investment with assurance of greater protection against
disruptive price fluctuations in their exports.
NATURAL RUBBER
In 1980, the International Natural Rubber Agreement entered into force
provisionally. U.S. membership in this new body was approved
overwhelmingly by the Senate last year. The natural rubber agreement is
a model of its kind and should make a substantial contribution to a
stable world market in this key industrial commodity. It is thus an
excellent example of constructive steps to improve the operation of the
world economy in ways which can benefit the developing and
industrialized countries alike. In particular, the agreement has
improved important U.S. relationships with the major natural
rubber-producing countries of Southeast Asia.
COMMON FUND
The United States joined members of the United Nations Conference on
Trade and Development, both developed and developing nations, in
concluding Articles of Agreement in 1980 for a Common Fund to help
international commodity agreements stabilize the prices of raw
materials.
ECONOMIC COOPERATION WITH DEVELOPING NATIONS
Our relations with the developing nations are of major importance to the
United States. The fabric of our relations with these countries has
strong economic and political dimensions. They constitute the most
rapidly growing markets for our exports, and are important sources of
fuel and raw materials. Their political views are increasingly
important, as demonstrated in their overwhelming condemnation of the
Soviet invasion of Afghanistan. Our ability to work together with
developing nations toward goals we have in common (their political
independence, the resolution of regional tensions, and our growing ties
of trade for example) require us to maintain the policy of active
involvement with the developing world that we have pursued over the past
four years.
The actions we have taken in such areas as energy, trade, commodities,
and international financial institutions are all important to the
welfare of the developing countries. Another important way the United
States can directly assist these countries and demonstrate our concern
for their future is through our multilateral and bilateral foreign
assistance program. The legislation which I will be submitting to you
for FY 82 provides the authority and the funds to carry on this
activity. Prompt Congressional action on this legislation is essential
in order to attack such high priority global problems as food and
energy, meet our treaty and base rights agreements, continue our peace
efforts in the Middle East, provide economic and development support to
countries in need, promote progress on North-South issues, protect
Western interests, and counter Soviet influence.
Our proposed FY 1982 bilateral development aid program is directly
responsive to the agreement reached at the 1980 Venice Economic Summit
that the major industrial nations should increase their aid for food and
energy production and for family planning. We understand that other
Summit countries plan similar responses. It is also important to honor
our international agreements for multilateral assistance by authorizing
and appropriating funds for the International Financial Institutions.
These multilateral programs enhance the efficiency of U.S. contributions
by combining them with those of many other donor countries to promote
development; the proposed new World Bank affiliate to increase energy
output in developing countries offers particular promise. All these
types of aid benefit our long-run economic and political interests.
Progress was made on a number of economic issues in negotiations
throughout the U.N. system. However, in spite of lengthy efforts in the
United Nations, agreement has not been reached on how to launch a
process of Global Negotiations in which nations might collectively work
to solve such important issues as energy, food, protectionism, and
population pressures. The United States continues to believe that
progress can best be made when nations focus on such specific problems,
rather than on procedural and institutional questions. It will continue
to work to move the North-South dialogue into a more constructive phase.
FOOD--THE WAR ON HUNGER
The War on Hunger must be a continuous urgent priority. Major portions
of the world’s population continue to be threatened by the specter of
hunger and malnutrition. During the past year, some 150 million people
in 36 African countries were faced with near disaster as the result of
serious drought, induced food shortages. Our government, working in
concert with the U.N.’s Food and Agricultural Organization (FAO), helped
to respond to that need. But the problems of hunger cannot be solved by
short-term measures. We must continue to support those activities,
bilateral and multilateral, which aim at improving food production
especially in developing countries and assuring global food security.
These measures are necessary to the maintenance of a stable and healthy
world economy.
I am pleased that negotiation of a new Food Aid Convention, which
guarantees a minimum annual level of food assistance, was successfully
concluded in March. The establishment of the International Emergency
Wheat Reserve will enable the U.S. to meet its commitment under the new
Convention to feed hungry people, even in times of short supply.
Of immediate concern is the prospect of millions of Africans threatened
by famine because of drought and civil disturbances. The U.S. plea for
increased food aid resulted in the organization of an international
pledging conference and we are hopeful that widespread starvation will
be avoided.
Good progress has been made since the Venice Economic Summit called for
increased effort on this front. We and other donor countries have begun
to assist poor countries develop long-term strategies to improve their
food production. The World Bank will invest up to $4 billion in the next
few years in improving the grain storage and food-handling capacity of
countries prone to food shortages.
Good progress has been made since the Tokyo Economic Summit called for
increased effort on this front. The World Bank is giving this problem
top priority, as are some other donor countries. The resources of the
consultative Group on International Agricultural Research will be
doubled over a five-year period. The work of our own Institute of
Scientific and Technological Cooperation will further strengthen the
search for relevant new agricultural technologies.
The goal of freeing the world from hunger by the year 2000 should
command the full support of all countries.
The Human Dimension of Foreign Policy
HUMAN RIGHTS
The human rights policy of the United States has been an integral part
of our overall foreign policy for the past several years. This policy
serves the national interest of the United States in several important
ways: by encouraging respect by governments for the basic rights of
human beings, it promotes peaceful, constructive change, reduces the
likelihood of internal pressures for violent change and for the
exploitation of these by our adversaries, and thus directly serves our
long-term interest in peace and stability; by matching espousal of
fundamental American principles of freedom with specific foreign policy
actions, we stand out in vivid contrast to our ideological adversaries;
by our efforts to expand freedom elsewhere, we render our own freedom,
and our own nation, more secure. Countries that respect human rights
make stronger allies and better friends.
Rather than attempt to dictate what system of government or institutions
other countries should have, the U.S. supports, throughout the world,
the internationally recognized human rights which all members of the
United Nations have pledged themselves to respect. There is more than
one model that can satisfy the continuing human reach for freedom and
justice:
1980 has been a year of some disappointments, but has also seen some
positive developments in the ongoing struggle for fulfillment of human
rights throughout the world. In the year we have seen:
--Free elections were held and democratic governments installed in Peru,
Dominica, and Jamaica. Honduras held a free election for installation of
a constituent assembly. An interim government was subsequently named
pointing toward national presidential elections in 1981. Brazil
continues on its course of political liberalization.
--The “Charter of Conduct” signed in Riobamba, Ecuador, by Ecuador,
Colombia, Venezuela, Peru, Costa Rica, Panama and Spain, affirms the
importance of democracy and human rights for the Andean countries.
--The Organization of American States, in its annual General Assembly,
approved a resolution in support of the Inter-American Human Rights
Commission’s work. The resolution took note of the Commission’s annual
report, which described the status of human rights in Chile, El
Salvador, Paraguay and Uruguay; and the special reports on Argentina and
Haiti, which described human rights conditions as investigated during
on-site inspections to these countries.
--The awarding of the Nobel Prize for Peace to Adolfo Perez Esquivel of
Argentina for his non-violent advocacy of human rights.
--The United States was able to rejoin the International Labor
Organization after an absence of two years, as that U.N. body reformed
its procedures to return to its original purpose of strengthening
employer-employee-government relations to insure human rights for the
working people of the world.
The United States, of course, cannot take credit for all these various
developments. But we can take satisfaction in knowing that our policies
encourage and perhaps influence them.
Those who see a contradiction between our security and our humanitarian
interests forget that the basis for a secure and stable society is the
bond of trust between a government and its people. I profoundly believe
that the future of our world is not to be found in authoritarianism:
that wears the mask of order, or totalitarianism that wears the mask of
justice. Instead, let us find our future in the human face of democracy,
the human voice of individual liberty, the human hand of economic
development.
HUMANITARIAN AID
The United States has continued to play its traditional role of
safehaven for those who flee or are forced to flee their homes because
of persecution or war. During 1980, the United States provided
resettlement opportunities for 216,000 refugees from countries around
the globe. In addition, the United States joined with other nations to
provide relief to refugees in country of first asylum in Africa, the
Middle East, and Asia.
The great majority of refugee admissions continued to be from
Indo-china. During 1980, 168,000 Indo-chinese were resettled in the
United States. Although refugee populations persist in camps in
Southeast Asia, and refugees continue to flee Vietnam, Laos and
Kampuchea, the flow is not as great as in the past. One factor in
reducing the flow from Vietnam has been the successful negotiation and
commencement of an Orderly Departure Program which permits us to process
Vietnamese for resettlement in the United States with direct departure
from Ho Chi Minh Ville in an orderly fashion. The first group of 250
departed Vietnam for the United States in December, 1980.
In addition to the refugees admitted last year, the United States
accepted for entry into the United States 125,000 Cubans who were
expelled by Fidel Castro. Federal and state authorities, as well as
private voluntary agencies, responded with unprecedented vigor to coping
with the unexpected influx of Cubans.
Major relief efforts to aid refugees in countries of first asylum
continued in several areas of the world. In December, 1980, thirty-two
nations, meeting in New York City, agreed to contribute $65 million to
the continuing famine relief program in Kampuchea. Due in great part to
the generosity of the American people and the leadership exercised in
the international arena by the United States, we have played the pivotal
role in ameliorating massive suffering in Kampuchea.
The United States has taken the lead among a group of donor countries
who are providing relief to some two million refugees in the Horn of
Africa who have been displaced by fighting in Ethiopia. U.S. assistance,
primarily to Somalia, consists of $35 million worth of food and $18
million in cash and kind. Here again, United States efforts can in large
part be credited with keeping hundreds of thousands of people alive.
Another major international relief effort has been mounted in Pakistan.
The United States is one of 25 countries plus the European Economic
Community who have been helping the Government of Pakistan to cope with
the problem of feeding and sheltering the more than one million refugees
that have been generated by the Soviet invasion of Afghanistan.
In April, 1980, the Congress passed the Refugee Act of 1980 which
brought together, for the first time, in one piece of legislation the
various threads of U.S. policy towards refugees. The law laid down a
new, broader definition of the term refugee, established mechanisms for
arriving at a level of refugee admissions through consultation with
Congress, and established the Office of the United States Coordinator
for Refugees.
It cannot be ignored that the destructive and aggressive policies of the
Soviet Union have added immeasurably to the suffering in these three
tragic situations.
The Control of Nuclear Weapons
Together with our friends and allies, we are striving to build a world
in which peoples with diverse interests can live freely and prosper. But
all that humankind has achieved to date, all that we are seeking to
accomplish, and human existence itself can be undone in an instant--in
the catastrophe of a nuclear war.
Thus one of the central objectives of my Administration has been to
control the proliferation of nuclear weapons to those nations which do
not have them, and their further development by the existing nuclear
powers-- notably the Soviet Union and the United States.
NON-PROLIFERATION
My Administration has been committed to stemming the spread of nuclear
weapons. Nuclear proliferation would raise the spectre of the use of
nuclear explosives in crucial, unstable regions of the world endangering
not only our security and that of our Allies, but that of the whole
world. Non-proliferation is not and can not be a unilateral U.S. policy,
nor should it be an issue of contention between the industrialized and
developing states. The international non-proliferation effort requires
the support of suppliers as well as importers of nuclear technology and
materials.
We have been proceeding on a number of fronts:
--First, we have been seeking to encourage nations to accede to the
Non-Proliferation Treaty. The U.S. is also actively encouraging other
nations to accept full-scope safeguards on all of their nuclear
activities and is asking other nuclear suppliers to adopt a full-scope
safeguards requirement as a condition for future supply.
--Second, the International Nuclear Fuel Cycle Evaluation (INFCE), which
was completed in 1980, demonstrated that suppliers and recipients can
work together on these technically complex and sensitive issues. While
differences remain, the INFCE effort provides a broader international
basis for national decisions which must balance energy needs with
non-proliferation concerns.
--Finally, we are working to encourage regional cooperation and
restraint. Protocol I of the Treaty of Tlatelolco which will contribute
to the lessening of nuclear dangers for our Latin American neighbors
ought now to be ratified by the United States Senate.
LIMITATIONS ON STRATEGIC ARMS
I remain convinced that the SALT II Treaty is in our Nation’s security
interest and that it would add significantly to the control of nuclear
weapons. I strongly support continuation of the SALT process and the
negotiation of more far-reaching mutual restraints on nuclear weaponry.
CONCLUSION
We have new support in the world for our purposes of national
independence and individual human dignity. We have a new will at home to
do what is required to keep us the strongest nation on earth.
We must move together into this decade with the strength which comes
from realization of the dangers before us and from the confidence that
together we can overcome them. The White House, January 16, 1981.
***