Public Papers - 1990 - March
Remarks to the National Association of Manufacturers
Dan, thank you, sir. Short and sweet, right to the point. [Laughter] And I'm glad to be here, and I'm delighted to be back with this group. And I want to salute your president, Jerry Jasinowski.
I told Barbara that I'd be spending some time with people who have risen to the top of the financial world by controlling the disbursement of billions of dollars. She said, ``You're addressing the baseball lawyers?'' [Laughter]
But regrettably, baseball's opening day may not be on the calendar yet. But the truth is the calendar offers each of us many opening days, convenient launch points for a fresh start. Sometimes it is a new day, a new year; and now, really, it's a new decade, a decade born amid the shouts of joy and triumph, a decade full of hope, barreling with confidence towards a new century and a new era. The rollcall is exciting, exhilarating, and accelerating. We call it the Revolution of '89, but in Poland, it took about 10 years; then in Hungary, about 10 months; East Germany, 10 weeks; Czechoslovakia, 10 days; and Bulgaria and Romania right behind.
Six nations in six months -- and from six different tongues we heard the same one word: freedom. The people of Central Europe believed it. They fought for it, and they deserve the credit. But take that word ``freedom,'' pick it up out of the newsprint, turn it over, and look on the back. And more often than not, you'll find that same proud label that adorns the products you produce: ``Made in America.''
Eight years ago, Ronald Reagan stood before this group -- your group -- and issued a bold and simple challenge. He said, ``America can serve as the catalyst for an era of unimagined human freedom and dignity.'' And the cry of that great President became the ``shout heard round the world.''
Back here, especially in Washington, there may be some that are still plagued by doubt. Maybe in Washington; certainly not in Warsaw. Asked if Radio Free Europe had been important to democracy in Poland, Lech Walesa responded with a question of his own. ``Would there be Earth without the Sun?'' was his reply.
Maybe in Washington, but not in Wenceslaus Square. Last month Vaclav Havel [President of Czechoslovakia] praised our resolve, the resolve of the United States of America as ``defenders of freedom,'' telling Congress that Czechoslovakia probably wouldn't exist today if it hadn't been for the Atlantic alliance. And just yesterday -- I talked to him this morning -- [West German] Chancellor Kohl told me today that just yesterday he was speaking in East Germany, and he told them that he wouldn't be there and this wouldn't be happening if it hadn't been for the United States of America. And no quotes are needed to tell you the role of American persistence and American courage in standing up for liberty in Panama and Nicaragua.
Yes, these are heady times. It's a wonderful time to be President of the United States and to be coping with this fantastic change that's taking place around the world. But the good news is it isn't only overseas because the Revolution of '89 marks the triumph not only of free ideas but also free markets. And when it comes to free markets, America continues to lead the way.
Here again, there are doubters, and I can understand that -- some who worry about a slowdown. And true, our economy is not perfect. Each one of you knows that. And I don't want to paint an unrealistic picture. But look at the facts: The United States economy is the largest, strongest, most productive economy on Earth. Our standard of living is one-third higher than that of West Germany or Japan. And with less than 5 percent of the world's people, in 1988 Americans accounted for more than 25 percent of the world's production. Our GNP is more than 2/2\ times that of the world's number two economy, Japan. And when a small percentage of people produce a huge percentage of wealth, there's a word for it. It's called productivity, and it is spelled ``USA.''
Thanks in no small part to the commitment and imagination of the people and the companies represented here in this room, last year American exports of goods and services hit an all-time high: over 0 billion. And today the United States is once again the world's number one exporter. Nineteen eighty-nine marked our seventh consecutive year of economic growth, and today we see GNP up, exports up, personal income up.
Now, some would say that every economy has its ups and downs. But take a look at what's down: The trade deficit -- I'm not standing here relaxed and saying it's perfect -- the trade deficit is down. The Federal deficit -- still not happy with it -- it's down. The prime rate -- down. And last year's unemployment rate -- down, the lowest since 1973.
And the good news is reaching a broad cross section of Americans. Nineteen eighty-nine unemployment rates for blacks and teenagers were the lowest since the early seventies. And for Hispanics, the 1989 rate was the lowest recorded since the Government began keeping separate data for this group back in 1980.
But we're not just talking about statistics and numbers. As Dick Darman [Director of the Office of Management and Budget] recently reminded me, ``Torture numbers, and they'll confess to anything.'' [Laughter] It would take Darman to come up with that, but he did. [Laughter]
Well, what we're really talking about here is people -- people who hold the 2/2\ million new jobs created just since I took office 1 year ago. For them, it means families and freedom, and it means dignity and decency because 2/2\ million American jobs means 2/2\ million American futures.
Speaking of futures, earlier I asked one CEO what he sees as the most lucrative growth industry in the 1990's. He said, ``Being a lawyer connected with the Trump case.'' [Laughter]
Our people and our economy are strong, and so is our resolve. And it's going to be tested soon, as the dramatic new changes in the world produce dramatic new challenges in the world market. And so, we must prepare now to meet these challenges. And our administration is committed to an agenda for growth. It's founded upon investing in our future, and every sound investment has its yield: America's yield is the growth dividend. The growth dividend will provide Americans with jobs and opportunity, higher living standards, and a legacy of prosperity. So, achieving solid and sustainable growth is my most fundamental domestic priority, and it's why I've proposed a strong agenda of growth initiatives.
This is a marathon. This isn't a sprint; it is a marathon. And we can't produce the products needed to capture world markets by focusing on results one quarter at a time. We need to return not only to yesterday's values but yesterday's thinking, the long-term thinking and investment-in-the-future way of doing business that produced the healthy climate that we enjoy today.
First, we need to bring more of America's investment capital back into the productive economy. And lowering the cost of capital will assure the continued investment in productive assets and human resources that are needed to keep our manufacturing sector the most competitive in the world. The bottom line: It's time for Congress to pass the capital gains tax cut. Here's what we're up against: Japan, capital gains rate, 5 percent; South Korea, 0; Taiwan, 0; West Germany, 0; Singapore, 0; Hong Kong, 0. And the list goes on. And we need your support for this critical tax cut. And America wants it done right, America wants it done responsibly, and America wants it done now. It means competitiveness, and it means jobs. And so, let them tell me that I'm favoring some tax cut for the rich; I am favoring jobs for the working man and woman in this country.
And second, we need to keep these interest rates down. And we are committed to helping that process by going to the heart of the matter. We submitted a budget that will continue to bring the Federal deficit down, and today I call on the budget committees to fulfill their legal responsibilities and come up with a budget resolution by April 1st. That is 2 weeks away. And it's time to act, the time to bring the deficit down.
And third, America needs a booster shot of new ideas along with the infusion of new capital that our tax cut -- capital gains differential -- will provide: matching investment capital with intellectual capital. And so, I call on Congress to help sharpen America's competitive edge: double the budget of the National Science Foundation, bring funding for research and development to a record high, make the research and experimentation tax credit permanent, and expand the Eisenhower education grants for math and science.
And fourth, we must stand behind our work force and the quality of our products. American workers today are good workers, best in the world, but we need to keep pace. Their children are the workers of tomorrow, and we owe them a better education, with an emphasis on basic skills, the sciences, math, and engineering. And we're going to do this in partnership with the American Governors and schools, giving those in need a fair start through Project Head Start, raising our high school graduation rates to at least 90 percent. And in science and math, our goal is unambiguous: first in the world by the year 2000. You see, we've got to reestablish standards and reestablish expectations, the kind of quality control so essential to everything that America produces.
Quality is something that you -- you understand it. You understand it better than most Americans. And quality in manufacturing and quality in education are intertwined. These goals are an important step towards restoring quality in education. They help focus our efforts less on input, the amount of money that goes into our schools, and more on output, the quality of the student that comes out.
The kind of basic quality control is also basic to producing quality goods. And it's being spurred on in American manufacturing by steps taken within your own ranks, steps like the prestigious, high-level competition produced by awards like those named after the late Mac Baldrige.
It's also spurred on by efforts to ensure a literate work force. We salute manufacturers' efforts like the one that Barbara, my wife, visited in Michigan recently, a model of cooperation between the Ford Motor Company and the United Auto Workers -- so many more like it that you all are involved in.
And finally, it's essential that we have a drug-free work force. One way to stop drugs at work is to make sure that it never starts -- preemployment drug screening -- because if you're not part of the solution, you're part of the problem.
A drug-impaired work force is one of the ways in which American competitiveness can suffer from a self-inflicted burden, but it's not the only one. So, next I call for Congress to act now to make the U.S. marketplace work better through two basic reforms: product-liability reform -- to increase our competitiveness without compromising safety -- and antitrust reform -- to remove obstacles to joint production ventures by U.S. companies.
As I've studied the problem, and trying to work with Congress on it and working with our environmentalists and business people, I am also convinced that America's growth need not come at the expense of the environment. Our natural resources are invaluable assets, and like any other assets, they need to be maintained in order to sustain our ability to grow.
For 13 years, Congress has been unable to pass a new Clean Air Act. Two weeks ago, we reached a breakthrough, a bipartisan agreement to untangle the web of regional politics that has stopped clean air. I am very pleased to compliment the Senate leadership for their very constructive negotiations, and today I call upon the Senate to stand by the agreement and to protect our environment without saddling the bill with new subsidies and cumbersome rules.
I mentioned self-inflicted burdens, and of course not all our competitive burdens are self-inflicted. There are also foreign barriers to U.S. exports which must be addressed. And earlier this month Prime Minister Kaifu and I agreed on the need for action on what we call Structural Impediments Initiative to break down nontariff barriers to the Japanese market. And we are pressing hard to get the Japanese Government to address specific trade categories. We must move aggressively to open markets not just in Japan but around the world and expand our share of global trade. For those of you who follow the Japanese market, you'll agree with me that we need to have more openness there. I can tell you not only were the Kaifu talks good but the talks that we had with the former Prime Minister Takeshita when he was here just a handful of days ago. We have got to have them understand the seriousness of the problem we face.
I still believe that for far-reaching, fundamental reform our best hope is the proposals that we have made in the Uruguay round of the GATT negotiations. We're determined to make a level playing field. Let America compete in an arena of fair trade, and we will take on anyone, anytime, anyplace.
As in Berlin, barriers are coming down all over the world. It took years of persistence, but the ideas championed by America -- freedom, democracy, competition, and investment -- are flourishing because they work, because they are the best. It can be the same for American goods.
In 1986, on the eve of July 4th, a single blue laser split the darkness over New York Harbor, a manmade lightning bolt that relit the torch of a reborn Statue of Liberty. The torch has been held high ever since. And today that light continues to inspire hope from Panama to Prague, from Moscow to Managua.
Somehow, a recent bit of news seems fitting: The bald eagle, the American eagle, may soon come off the endangered species list. Ladies and gentlemen, America is back, and this time we are back to stay. And I look forward to working with this organization, your member companies, to doing what we can in government to facilitate free and fair trade to help maintain and strengthen an economy that is good for the working man and the working woman of this country.
Thank you for inviting me over. And God bless you, and God bless our great country. Thank you very much.
Note: The President spoke at 10:27 a.m. in the Grand Ballroom at the Ramada Renaissance Hotel. In his remarks, he referred to Daniel Krumm, chairman of the association.