[ As delivered in person before a joint session ] Mr. Vice President, Mr. Speaker, Members of the 88th Congress: I congratulate you all--not merely on your electoral victory but on your selected role in history. For you and I are privileged to serve the great Republic in what could be the most decisive decade in its long history. The choices we make, for good or ill, may well shape the state of the Union for generations yet to come. Little more than 100 weeks ago I assumed the office of President of the United States. In seeking the help of the Congress and our countrymen, I pledged no easy answers. I pledged--and asked--only toil and dedication. These the Congress and the people have given in good measure. And today, having witnessed in recent months a heightened respect for our national purpose and power--having seen the courageous calm of a united people in a perilous hour--and having observed a steady improvement in the opportunities and well-being of our citizens--I can report to you that the state of this old but youthful Union, in the 175th year of its life, is good. In the world beyond our borders, steady progress has been made in building a world of order. The people of West Berlin remain both free and secure. A settlement, though still precarious, has been reached in Laos. The spearpoint of aggression has been blunted in Viet-Nam. The end of agony may be in sight in the Congo. The doctrine of troika is dead. And, while danger continues, a deadly threat has been removed in Cuba. At home, the recession is behind us. Well over a million more men and women are working today than were working 2 years ago. The average factory workweek is once again more than 40 hours; our industries are turning out more goods than ever before; and more than half of the manufacturing capacity that lay silent and wasted 100 weeks ago is humming with activity. In short, both at home and abroad, there may now be a temptation to relax. For the road has been long, the burden heavy, and the pace consistently urgent. But we cannot be satisfied to rest here. This is the side of the hill, not the top. The mere absence of war is not peace. The mere absence of recession is not growth. We have made a beginning--but we have only begun. Now the time has come to make the most of our gains--to translate the renewal of our national strength into the achievement of our national purpose. II. America has enjoyed 22 months of uninterrupted economic recovery. But recovery is not enough. If we are to prevail in the long run, we must expand the long-run strength of our economy. We must move along the path to a higher rate of growth and full employment. For this would mean tens of billions of dollars more each year in production, profits, wages, and public revenues. It would mean an end to the persistent slack which has kept our unemployment at or above 5 percent for 61 out of the past 62 months--and an end to the growing pressures for such restrictive measures as the 35-hour week, which alone could increase hourly labor costs by as much as 14 percent, start a new wage-price spiral of inflation, and undercut our efforts to compete with other nations. To achieve these greater gains, one step, above all, is essential--the enactment this year of a substantial reduction and revision in Federal income taxes. For it is increasingly clear--to those in Government, business, and labor who are responsible for our economy's success--that our obsolete tax system exerts too heavy a drag on private purchasing power, profits, and employment. Designed to check inflation in earlier years, it now checks growth instead. It discourages extra effort and risk. It distorts the use of resources. It invites recurrent recessions, depresses our Federal revenues, and causes chronic budget deficits. Now, when the inflationary pressures of the war and the post-war years no longer threaten, and the dollar commands new respect--now, when no military crisis strains our resources--now is the time to act. We cannot afford to be timid or slow. For this is the most urgent task confronting the Congress in 1963. In an early message, I shall propose a permanent reduction in tax rates which will lower liabilities by $13.5 billion. Of this, $11 billion results from reducing individual tax rates, which now range between 20 and 91 percent, to a more sensible range of 14 to 65 percent, with a split in the present first bracket. Two and one-half billion dollars results from reducing corporate tax rates, from 52 percent--which gives the Government today a majority interest in profits--to the permanent pre-Korean level of 47 percent. This is in addition to the more than $2 billion cut in corporate tax liabilities resulting from last year's investment credit and depreciation reform. To achieve this reduction within the limits of a manageable budgetary deficit, I urge: first, that these cuts be phased over 3 calendar years, beginning in 1963 with a cut of some $6 billion at annual rates; second, that these reductions be coupled with selected structural changes, beginning in 1964, which will broaden the tax base, end unfair or unnecessary preferences, remove or lighten certain hardships, and in the net offset some $3.5 billion of the revenue loss; and third, that budgetary receipts at the outset be increased by $1.5 billion a year, without any change in tax liabilities, by gradually shifting the tax payments of large corporations to a more current time schedule. This combined program, by increasing the amount of our national income, will in time result in still higher Federal revenues. It is a fiscally responsible program--the surest and the soundest way of achieving in time a balanced budget in a balanced full employment economy. This net reduction in tax liabilities of $10 billion will increase the purchasing power of American families and business enterprises in every tax bracket, with greatest increase going to our low-income consumers. It will, in addition, encourage the initiative and risk-taking on which our free system depends--induce more investment, production, and capacity use--help provide the 2 million new jobs we need every year--and reinforce the American principle of additional reward for additional effort. I do not say that a measure for tax reduction and reform is the only way to achieve these goals. --No doubt a massive increase in Federal spending could also create jobs and growth--but, in today's setting, private consumers, employers, and investors should be given a full opportunity first. --No doubt a temporary tax cut could provide a spur to our economy--but a long run problem compels a long-run solution. --No doubt a reduction in either individual or corporation taxes alone would be of great help--but corporations need customers and job seekers need jobs. --No doubt tax reduction without reform would sound simpler and more attractive to many--but our growth is also hampered by a host of tax inequities and special preferences which have distorted the flow of investment. --And, finally, there are no doubt some who would prefer to put off a tax cut in the hope that ultimately an end to the cold war would make possible an equivalent cut in expenditures--but that end is not in view and to wait for it would be costly and self-defeating. In submitting a tax program which will, of course, temporarily increase the deficit but can ultimately end it--and in recognition of the need to control expenditures--I will shortly submit a fiscal 1964 administrative budget which, while allowing for needed rises in defense, space, and fixed interest charges, holds total expenditures for all other purposes below this year's level. This requires the reduction or postponement of many desirable programs, the absorption of a large part of last year's Federal pay raise through personnel and other economies, the termination of certain installations and projects, and the substitution in several programs of private for public credit. But I am convinced that the enactment this year of tax reduction and tax reform overshadows all other domestic problems in this Congress. For we cannot for long lead the cause of peace and freedom, if we ever cease to set the pace here at home. III. Tax reduction alone, however, is not enough to strengthen our society, to provide opportunities for the four million Americans who are born every year, to improve the lives of 32 million Americans who live on the outskirts of poverty. The quality of American life must keep pace with the quantity of American goods. This country cannot afford to be materially rich and spiritually poor. Therefore, by holding down the budgetary cost of existing programs to keep within the limitations I have set, it is both possible and imperative to adopt other new measures that we cannot afford to postpone. These measures are based on a series of fundamental premises, grouped under four related headings: First, we need to strengthen our Nation by investing in our youth: --The future of any country which is dependent upon the will and wisdom of its citizens is damaged, and irreparably damaged, whenever any of its children is not educated to the full extent of his talent, from grade school through graduate school. Today, an estimated 4 out of every 10 students in the 5th grade will not even finish high school--and that is a waste we cannot afford. --In addition, there is no reason why one million young Americans, out of school and out of work, should all remain unwanted and often untrained on our city streets when their energies can be put to good use. --Finally, the overseas success of our Peace Corps volunteers, most of them young men and women carrying skills and ideas to needy people, suggests the merit of a similar corps serving our own community needs: in mental hospitals, on Indian reservations, in centers for the aged or for young delinquents, in schools for the illiterate or the handicapped. As the idealism of our youth has served world peace, so can it serve the domestic tranquility. Second, we need to strengthen our Nation by safeguarding its health: --Our working men and women, instead of being forced to beg for help from public charity once they are old and ill, should start contributing now to their own retirement health program through the Social Security System. --Moreover, all our miracles of medical research will count for little if we cannot reverse the growing nationwide shortage of doctors, dentists, and nurses, and the widespread shortages of nursing homes and modern urban hospital facilities. Merely to keep the present ratio of doctors and dentists from declining any further, we must over the next 10 years increase the capacity of our medical schools by 50 percent and our dental schools by 100 percent. --Finally, and of deep concern, I believe that the abandonment of the mentally ill and the mentally retarded to the grim mercy of custodial institutions too often inflicts on them and on their families a needless cruelty which this Nation should not endure. The incidence of mental retardation in this country is three times as high as that of Sweden, for example--and that figure can and must be reduced. Third, we need to strengthen our Nation by protecting the basic rights of its citizens: --The right to competent counsel must be assured to every man accused of crime in Federal court, regardless of his means. --And the most precious and powerful right in the world, the right to vote in a free American election, must not be denied to any citizen on grounds of his race or color. I wish that all qualified Americans permitted to vote were willing to vote, but surely in this centennial year of Emancipation all those who are willing to vote should always be permitted. Fourth, we need to strengthen our Nation by making the best and the most economical use of its resources and facilities: --Our economic health depends on healthy transportation arteries; and I believe the way to a more modern, economical choice of national transportation service is through increased competition and decreased regulation. Local mass transit, faring even worse, is as essential a community service as hospitals and highways. Nearly three-fourths of our citizens live in urban areas, which occupy only 2 percent of our land--and if local transit is to survive and relieve the congestion of these cities, it needs Federal stimulation and assistance. --Next, this Government is in the storage and stockpile business to the melancholy tune of more than $ 16 billion. We must continue to support farm income, but we should not pile more farm surpluses on top of the $7.5 billion we already own. We must maintain a stockpile of strategic materials, but the $8.5 billion we have acquired--for reasons both good and bad--is much more than we need; and we should be empowered to dispose of the excess in ways which will not cause market disruption. --Finally, our already overcrowded national parks and recreation areas will have twice as many visitors 10 years from now as they do today. If we do not plan today for the future growth of these and other great natural assets--not only parks and forests but wildlife and wilderness preserves, and water projects of all kinds--our children and their children will be poorer in every sense of the word. These are not domestic concerns alone. For upon our achievement of greater vitality and strength here at home hang our fate and future in the world: our ability to sustain and supply the security of free men and nations, our ability to command their respect for our leadership, our ability to expand our trade without threat to our balance of payments, and our ability to adjust to the changing demands of cold war competition and challenge. We shall be judged more by what we do at home than by what we preach abroad. Nothing we could do to help the developing countries would help them half as much as a booming U.S. economy. And nothing our opponents could do to encourage their own ambitions would encourage them half as much as a chronic lagging U.S. economy. These domestic tasks do not divert energy from our security--they provide the very foundation for freedom's survival and success, IV. Turning to the world outside, it was only a few years ago--in Southeast Asia, Africa, Eastern Europe, Latin America, even outer space--that communism sought to convey the image of a unified, confident, and expanding empire, closing in on a sluggish America and a free world in disarray. But few people would hold to that picture today. In these past months we have reaffirmed the scientific and military superiority of freedom. We have doubled our efforts in space, to assure us of being first in the future. We have undertaken the most far-reaching defense improvements in the peacetime history of this country. And we have maintained the frontiers of freedom from Viet-Nam to West Berlin. But complacency or self-congratulation can imperil our security as much as the weapons of tyranny. A moment of pause is not a promise of peace. Dangerous problems remain from Cuba to the South China Sea. The world's prognosis prescribes, in short, not a year's vacation for us, but a year of obligation and opportunity. Four special avenues of opportunity stand out: the Atlantic Alliance, the developing nations, the new Sino-Soviet difficulties, and the search for worldwide peace. V. First, how fares the grand alliance? Free Europe is entering into a new phase of its long and brilliant history. The era of colonial expansion has passed; the era of national rivalries is fading; and a new era of interdependence and unity is taking shape. Defying the old prophecies of Marx, consenting to what no conqueror could ever compel, the free nations of Europe are moving toward a unity of purpose and power and policy in every sphere of activity. For 17 years this movement has had our consistent support, both political and economic. Far from resenting the new Europe, we regard her as a welcome partner, not a rival. For the road to world peace and freedom is still long, and there are burdens which only full partners can share--in supporting the common defense, in expanding world trade, in aligning our balance of payments, in aiding the emergent nations, in concerting political and economic policies, and in welcoming to our common effort other industrialized nations, notably Japan, whose remarkable economic and political development of the 1950's permits it now to play on the world scene a major constructive role. No doubt differences of opinion will continue to get more attention than agreements on action, as Europe moves from independence to more formal interdependence. But these are honest differences among honorable associates--more real and frequent, in fact, among our Western European allies than between them and the United States. For the unity of freedom has never relied on uniformity of opinion. But the basic agreement of this alliance on fundamental issues continues. The first task of the alliance remains the common defense. Last month Prime Minister Macmillan and I laid plans for a new stage in our long cooperative effort, one which aims to assist in the wider task of framing a common nuclear defense for the whole alliance. The Nassau agreement recognizes that the security of the West is indivisible, and so must be our defense. But it also recognizes that this is an alliance of proud and sovereign nations, and works best when we do not forget it. It recognizes further that the nuclear defense of the West is not a matter for the present nuclear powers alone--that France will be such a power in the future--and that ways must be found without increasing the hazards of nuclear diffusion, to increase the role of our other partners in planning, manning, and directing a truly multilateral nuclear force within an increasingly intimate NATO alliance. Finally, the Nassau agreement recognizes that nuclear defense is not enough, that the agreed NATO levels of conventional strength must be met, and that the alliance cannot afford to be in a position of having to answer every threat with nuclear weapons or nothing. We remain too near the Nassau decisions, and too far from their full realization, to know their place in history. But I believe that, for the first time, the door is open for the nuclear defense of the alliance to become a source of confidence, instead of a cause of contention. The next most pressing concern of the alliance is our common economic goals of trade and growth. This Nation continues to be concerned about its balance-of-payments deficit, which, despite its decline, remains a stubborn and troublesome problem. We believe, moreover, that closer economic ties among all free nations are essential to prosperity and peace. And neither we nor the members of the European Common Market are so affluent that we can long afford to shelter high cost farms or factories from the winds of foreign competition, or to restrict the channels of trade with other nations of the free world. If the Common Market should move toward protectionism and restrictionism, it would undermine its, own basic principles. This Government means to use the authority conferred on it last year by the Congress to encourage trade expansion on both sides of the Atlantic and around the world. VI, Second, what of the developing and nonaligned nations? They were shocked by the Soviets' sudden and secret attempt to transform Cuba into a nuclear striking base--and by Communist China's arrogant invasion of India. They have been reassured by our prompt assistance to India, by our support through the United Nations of the Congo's unification, by our patient search for disarmament, and by the improvement in our treatment of citizens and visitors whose skins do not happen to be white. And as the older colonialism recedes, and the neocolonialism of the Communist powers stands out more starkly than ever, they realize more clearly that the issue in the world struggle is not communism versus capitalism, but coercion versus free choice. They are beginning to realize that the longing for independence is the same the world over, whether it is the independence of West Berlin or Viet-Nam. They are beginning to realize that such independence runs athwart all Communist ambitions but is in keeping with our own--and that our approach to their diverse needs is resilient and resourceful, while the Communists are still relying on ancient doctrines and dogmas. Nevertheless it is hard for any nation to focus on an external or subversive threat to its independence when its energies are drained in daily combat with the forces of poverty and despair. It makes little sense for us to assail, in speeches and resolutions, the horrors of communism, to spend $50 billion a year to prevent its military advance--and then to begrudge spending, largely on American products, less than one-tenth of that amount to help other nations strengthen their independence and cure the social chaos in which communism always has thrived. I am proud--and I think most Americans are proud--of a mutual defense and assistance program, evolved with bipartisan support in three administrations, which has, with all its recognized problems, contributed to the fact that not a single one of the nearly fifty U.N. members to gain independence since the Second World War has succumbed to Communist control. I am proud of a program that has helped to arm and feed and clothe millions of people who live on the front lines of freedom. I am especially proud that this country has put forward for the 60's a vast cooperative effort to achieve economic growth and social progress throughout the Americas--the Alliance for Progress. I do not underestimate the difficulties that we face in this mutual effort among our close neighbors, but the free states of this hemisphere, working in close collaboration, have begun to make this alliance a living reality. Today it is feeding one out of every four school age children in Latin America an extra food ration from our farm surplus. It has distributed 1.5 million school books and is building 17,000 classrooms. It has helped resettle tens of thousands of farm families on land they can call their own. It is stimulating our good neighbors to more self-help and self-reform--fiscal, social, institutional, and land reforms. It is bringing new housing and hope, new health and dignity, to millions who were forgotten. The men and women of this hemisphere know that the alliance cannot Succeed if it is only another name for United States handouts--that it can succeed only as the Latin American nations themselves devote their best effort to fulfilling its goals. This story is the same in Africa, in the Middle East, and in Asia. Wherever nations are willing to help themselves, we stand ready to help them build new bulwarks of freedom. We are not purchasing votes for the cold war; we have gone to the aid of imperiled nations, neutrals and allies alike. What we do ask--and all that we ask--is that our help be used to best advantage, and that their own efforts not be diverted by needless quarrels with other independent nations. Despite all its past achievements, the continued progress of the mutual assistance program requires a persistent discontent with present performance. We have been reorganizing this program to make it a more effective, efficient instrument--and that process will continue this year. But free world development will still be an uphill struggle. Government aid can only supplement the role of private investment, trade expansion, commodity stabilization, and, above all, internal self-improvement. The processes of growth are gradual--bearing fruit in a decade, not a day. Our successes will be neither quick nor dramatic. But if these programs were ever to be ended, our failures in a dozen countries would be sudden and certain. Neither money nor technical assistance, however, can be our only weapon against poverty. In the end, the crucial effort is one of purpose, requiring the fuel of finance but also a torch of idealism. And nothing carries the spirit of this American idealism more effectively to the far corners of the earth than the American Peace Corps. A year ago, less than 900 Peace Corps volunteers were on the job. A year from now they will number more than 9,000--men and women, aged 18 to 79, willing to give 2 years of their lives to helping people in other lands. There are, in fact, nearly a million Americans serving their country and the cause of freedom in overseas posts, a record no other people can match. Surely those of us who stay at home should be glad to help indirectly; by supporting our aid programs; .by opening our doors to foreign visitors and diplomats and students; and by proving, day by day, by deed as well as word, that we are a just and generous people. VII. Third, what comfort can we take from the increasing strains and tensions within the Communist bloc? Here hope must be tempered with caution. For the Soviet-Chinese disagreement is over means, not ends. A dispute over how best to bury the free world is no grounds for Western rejoicing. Nevertheless, while a strain is not a fracture, it is clear that the forces of diversity are at work inside the Communist camp, despite all the iron disciplines of regimentation and all the iron dogmatism's of ideology. Marx is proven wrong once again: for it is the closed Communist societies, not the free and open societies which carry within themselves the seeds of internal disintegration. The disarray of the Communist empire has been heightened by two other formidable forces. One is the historical force of nationalism--and the yearning of all men to be free. The other is the gross inefficiency of their economies. For a closed society is not open to ideas of progress--and a police state finds that it cannot command the grain to grow. New nations asked to choose between two competing systems need only compare conditions in East and West Germany, Eastern and Western Europe, North and South Viet-Nam. They need only compare the disillusionment of Communist Cuba with the promise of the Alliance for Progress. And all the world knows that no successful system builds a wall to keep its people in and freedom out--and the wall of shame dividing Berlin is a symbol of Communist failure. VIII. Finally, what can we do to move from the present pause toward enduring peace? Again I would counsel caution. I foresee no spectacular reversal in Communist methods or goals. But if all these trends and developments can persuade the Soviet Union to walk the path of peace, then let her know that all free nations will journey with her. But until that choice is made, and until the world can develop a reliable system of international security, the free peoples have no choice but to keep their arms nearby. This country, therefore, continues to require the best defense in the world--a defense which is suited to the sixties. This means, unfortunately, a rising defense budget--for there is no substitute for adequate defense, and no "bargain basement" way of achieving it. It means the expenditure of more than $15 billion this year on nuclear weapons systems alone, a sum which is about equal to the combined defense budgets of our European Allies. But it also means improved air and missile defenses, improved civil defense, a strengthened anti-guerrilla capacity and, of prime importance, more powerful and flexible nonnuclear forces. For threats of massive retaliation may not deter piecemeal aggression--and a line of destroyers in a quarantine, or a division of well-equipped men on a border, may be more useful to our real security than the multiplication of awesome weapons beyond all rational need. But our commitment to national safety is not a commitment to expand our military establishment indefinitely. We do not dismiss disarmament as merely an idle dream. For we believe that, in the end, it is the only way to assure the security of all without impairing the interests of any. Nor do we mistake honorable negotiation for appeasement. While we shall never weary in the defense of freedom, neither shall we ever abandon the pursuit of peace. In this quest, the United Nations requires our full and continued support. Its value in serving the cause of peace has been shown anew in its role in the West New Guinea settlement, in its use as a forum for the Cuban crisis, and in its task of unification in the Congo. Today the United Nations is primarily the protector of the small and the weak, and a safety valve for the strong. Tomorrow it can form the framework for a world of law--a world in which no nation dictates the destiny of another, and in which the vast resources now devoted to destructive means will serve constructive ends. In short, let our adversaries choose. If they choose peaceful competition, they shall have it. If they come to realize that their ambitions cannot succeed--if they see their "wars of liberation" and subversion will ultimately fail--if they recognize that there is more security in accepting inspection than in permitting new nations to master the black arts of nuclear war--and if they are willing to turn their energies, as we are, to the great unfinished tasks of our own peoples--then, surely, the areas of agreement can be very wide indeed: a clear understanding about Berlin, stability in Southeast Asia, an end to nuclear testing, new checks on surprise or accidental attack, and, ultimately, general and complete disarmament. IX. For we seek not the worldwide victory of one nation or system but a worldwide victory of man. The modern globe is too small, its weapons are too destructive, and its disorders are too contagious to permit any other kind of victory. To achieve this end, the United States will continue to spend a greater portion of its national production than any other people in the free world. For 15 years no other free nation has demanded so much of itself. Through hot wars and cold, through recession and prosperity, through the ages of the atom and outer space, the American people have never faltered and their faith has never flagged. If at times our actions seem to make life difficult for others, it is only because history has made life difficult for us all. But difficult days need not be dark. I think these are proud and memorable days in the cause of peace and freedom. We are proud, for example, of Major Rudolf Anderson who gave his life over the island of Cuba. We salute Specialist James Allen Johnson who died on the border of South Korea. We pay honor to Sergeant Gerald Pendell who was killed in Viet-Nam. They are among the many who in this century, far from home, have died for our country. Our task now, and the task of all Americans is to live up to their commitment. My friends: I close on a note of hope. We are not lulled by the momentary calm of the sea or the somewhat clearer skies above. We know the turbulence that lies below, and the storms that are beyond the horizon this year. But now the winds of change appear to be blowing more strongly than ever, in the world of communism as well as our own. For 175 years we have sailed with those winds at our back, and with the tides of human freedom in our favor. We steer our ship with hope, as Thomas Jefferson said, "leaving Fear astern." Today we still welcome those winds of change--and we have every reason to believe that our tide is running strong. With thanks to Almighty God for seeing us through a perilous passage, we ask His help anew in guiding the "Good Ship Union."
[ As delivered in person before a joint session ] Mr. Vice President, Mr. Speaker, Members of the 88th Congress: I congratulate you all--not merely on your electoral victory but on your selected role in history. For you and I are privileged to serve the great Republic in what could be the most decisive decade in its long history. The choices we make, for good or ill, may well shape the state of the Union for generations yet to come. Little more than 100 weeks ago I assumed the office of President of the United States. In seeking the help of the Congress and our countrymen, I pledged no easy answers. I pledged--and asked--only toil and dedication. These the Congress and the people have given in good measure. And today, having witnessed in recent months a heightened respect for our national purpose and power--having seen the courageous calm of a united people in a perilous hour--and having observed a steady improvement in the opportunities and well-being of our citizens--I can report to you that the state of this old but youthful Union, in the 175th year of its life, is good. In the world beyond our borders, steady progress has been made in building a world of order. The people of West Berlin remain both free and secure. A settlement, though still precarious, has been reached in Laos. The spearpoint of aggression has been blunted in Viet-Nam. The end of agony may be in sight in the Congo. The doctrine of troika is dead. And, while danger continues, a deadly threat has been removed in Cuba. At home, the recession is behind us. Well over a million more men and women are working today than were working 2 years ago. The average factory workweek is once again more than 40 hours; our industries are turning out more goods than ever before; and more than half of the manufacturing capacity that lay silent and wasted 100 weeks ago is humming with activity. In short, both at home and abroad, there may now be a temptation to relax. For the road has been long, the burden heavy, and the pace consistently urgent. But we cannot be satisfied to rest here. This is the side of the hill, not the top. The mere absence of war is not peace. The mere absence of recession is not growth. We have made a beginning--but we have only begun. Now the time has come to make the most of our gains--to translate the renewal of our national strength into the achievement of our national purpose. II. America has enjoyed 22 months of uninterrupted economic recovery. But recovery is not enough. If we are to prevail in the long run, we must expand the long-run strength of our economy. We must move along the path to a higher rate of growth and full employment. For this would mean tens of billions of dollars more each year in production, profits, wages, and public revenues. It would mean an end to the persistent slack which has kept our unemployment at or above 5 percent for 61 out of the past 62 months--and an end to the growing pressures for such restrictive measures as the 35-hour week, which alone could increase hourly labor costs by as much as 14 percent, start a new wage-price spiral of inflation, and undercut our efforts to compete with other nations. To achieve these greater gains, one step, above all, is essential--the enactment this year of a substantial reduction and revision in Federal income taxes. For it is increasingly clear--to those in Government, business, and labor who are responsible for our economy's success--that our obsolete tax system exerts too heavy a drag on private purchasing power, profits, and employment. Designed to check inflation in earlier years, it now checks growth instead. It discourages extra effort and risk. It distorts the use of resources. It invites recurrent recessions, depresses our Federal revenues, and causes chronic budget deficits. Now, when the inflationary pressures of the war and the post-war years no longer threaten, and the dollar commands new respect--now, when no military crisis strains our resources--now is the time to act. We cannot afford to be timid or slow. For this is the most urgent task confronting the Congress in 1963. In an early message, I shall propose a permanent reduction in tax rates which will lower liabilities by $13.5 billion. Of this, $11 billion results from reducing individual tax rates, which now range between 20 and 91 percent, to a more sensible range of 14 to 65 percent, with a split in the present first bracket. Two and one-half billion dollars results from reducing corporate tax rates, from 52 percent--which gives the Government today a majority interest in profits--to the permanent pre-Korean level of 47 percent. This is in addition to the more than $2 billion cut in corporate tax liabilities resulting from last year's investment credit and depreciation reform. To achieve this reduction within the limits of a manageable budgetary deficit, I urge: first, that these cuts be phased over 3 calendar years, beginning in 1963 with a cut of some $6 billion at annual rates; second, that these reductions be coupled with selected structural changes, beginning in 1964, which will broaden the tax base, end unfair or unnecessary preferences, remove or lighten certain hardships, and in the net offset some $3.5 billion of the revenue loss; and third, that budgetary receipts at the outset be increased by $1.5 billion a year, without any change in tax liabilities, by gradually shifting the tax payments of large corporations to a more current time schedule. This combined program, by increasing the amount of our national income, will in time result in still higher Federal revenues. It is a fiscally responsible program--the surest and the soundest way of achieving in time a balanced budget in a balanced full employment economy. This net reduction in tax liabilities of $10 billion will increase the purchasing power of American families and business enterprises in every tax bracket, with greatest increase going to our low-income consumers. It will, in addition, encourage the initiative and risk-taking on which our free system depends--induce more investment, production, and capacity use--help provide the 2 million new jobs we need every year--and reinforce the American principle of additional reward for additional effort. I do not say that a measure for tax reduction and reform is the only way to achieve these goals. --No doubt a massive increase in Federal spending could also create jobs and growth--but, in today's setting, private consumers, employers, and investors should be given a full opportunity first. --No doubt a temporary tax cut could provide a spur to our economy--but a long run problem compels a long-run solution. --No doubt a reduction in either individual or corporation taxes alone would be of great help--but corporations need customers and job seekers need jobs. --No doubt tax reduction without reform would sound simpler and more attractive to many--but our growth is also hampered by a host of tax inequities and special preferences which have distorted the flow of investment. --And, finally, there are no doubt some who would prefer to put off a tax cut in the hope that ultimately an end to the cold war would make possible an equivalent cut in expenditures--but that end is not in view and to wait for it would be costly and self-defeating. In submitting a tax program which will, of course, temporarily increase the deficit but can ultimately end it--and in recognition of the need to control expenditures--I will shortly submit a fiscal 1964 administrative budget which, while allowing for needed rises in defense, space, and fixed interest charges, holds total expenditures for all other purposes below this year's level. This requires the reduction or postponement of many desirable programs, the absorption of a large part of last year's Federal pay raise through personnel and other economies, the termination of certain installations and projects, and the substitution in several programs of private for public credit. But I am convinced that the enactment this year of tax reduction and tax reform overshadows all other domestic problems in this Congress. For we cannot for long lead the because of peace and freedom, if we ever cease to set the pace here at home. III. Tax reduction alone, however, is not enough to strengthen our society, to provide opportunities for the four million Americans who are born every year, to improve the lives of 32 million Americans who live on the outskirts of poverty. The quality of American life must keep pace with the quantity of American goods. This country cannot afford to be materially rich and spiritually poor. Therefore, by holding down the budgetary cost of existing programs to keep within the limitations I have set, it is both possible and imperative to adopt other new measures that we cannot afford to postpone. These measures are based on a series of fundamental premises, grouped under four related headings: First, we need to strengthen our Nation by investing in our youth: --The future of any country which is dependent upon the will and wisdom of its citizens is damaged, and irreparably damaged, whenever any of its children is not educated to the full extent of his talent, from grade school through graduate school. Today, an estimated 4 out of every 10 students in the 5th grade will not even finish high school--and that is a waste we cannot afford. --In addition, there is no reason why one million young Americans, out of school and out of work, should all remain unwanted and often untrained on our city streets when their energies can be put to good use. --Finally, the overseas success of our Peace Corps volunteers, most of them young men and women carrying skills and ideas to needy people, suggests the merit of a similar corps serving our own community needs: in mental hospitals, on Indian reservations, in centers for the aged or for young delinquents, in schools for the illiterate or the handicapped. As the idealism of our youth has served world peace, so can it serve the domestic tranquility. Second, we need to strengthen our Nation by safeguarding its health: --Our working men and women, instead of being forced to beg for help from public charity once they are old and ill, should start contributing now to their own retirement health program through the Social Security System. --Moreover, all our miracles of medical research will count for little if we cannot reverse the growing nationwide shortage of doctors, dentists, and nurses, and the widespread shortages of nursing homes and modern urban hospital facilities. Merely to keep the present ratio of doctors and dentists from declining any further, we must over the next 10 years increase the capacity of our medical schools by 50 percent and our dental schools by 100 percent. --Finally, and of deep concern, I believe that the abandonment of the mentally ill and the mentally retarded to the grim mercy of custodial institutions too often inflicts on them and on their families a needless cruelty which this Nation should not endure. The incidence of mental retardation in this country is three times as high as that of Sweden, for example--and that figure can and must be reduced. Third, we need to strengthen our Nation by protecting the basic rights of its citizens: --The right to competent counsel must be assured to every man accused of crime in Federal court, regardless of his means. --And the most precious and powerful right in the world, the right to vote in a free American election, must not be denied to any citizen on grounds of his race or color. I wish that all qualified Americans permitted to vote were willing to vote, but surely in this centennial year of Emancipation all those who are willing to vote should always be permitted. Fourth, we need to strengthen our Nation by making the best and the most economical use of its resources and facilities: --Our economic health depends on healthy transportation arteries; and I believe the way to a more modern, economical choice of national transportation service is through increased competition and decreased regulation. Local mass transit, faring even worse, is as essential a community service as hospitals and highways. Nearly three-fourths of our citizens live in urban areas, which occupy only 2 percent of our land--and if local transit is to survive and relieve the congestion of these cities, it needs Federal stimulation and assistance. --Next, this Government is in the storage and stockpile business to the melancholy tune of more than $ 16 billion. We must continue to support farm income, but we should not pile more farm surpluses on top of the $7.5 billion we already own. We must maintain a stockpile of strategic materials, but the $8.5 billion we have acquired--for reasons both good and bad--is much more than we need; and we should be empowered to dispose of the excess in ways which will not because market disruption. --Finally, our already overcrowded national parks and recreation areas will have twice as many visitors 10 years from now as they do today. If we do not plan today for the future growth of these and other great natural assets--not only parks and forests but wildlife and wilderness preserves, and water projects of all kinds--our children and their children will be poorer in every sense of the word. These are not domestic concerns alone. For upon our achievement of greater vitality and strength here at home hang our fate and future in the world: our ability to sustain and supply the security of free men and nations, our ability to command their respect for our leadership, our ability to expand our trade without threat to our balance of payments, and our ability to adjust to the changing demands of cold war competition and challenge. We shall be judged more by what we do at home than by what we preach abroad. Nothing we could do to help the developing countries would help them half as much as a booming YOU.S. economy. And nothing our opponents could do to encourage their own ambitions would encourage them half as much as a chronic lagging YOU.S. economy. These domestic tasks do not divert energy from our security--they provide the very foundation for freedom's survival and success, IV. Turning to the world outside, it was only a few years ago--in Southeast Asia, Africa, Eastern Europe, Latin America, even outer space--that communism sought to convey the image of a unified, confident, and expanding empire, closing in on a sluggish America and a free world in disarray. But few people would hold to that picture today. In these past months we have reaffirmed the scientific and military superiority of freedom. We have doubled our efforts in space, to assure us of being first in the future. We have undertaken the most far-reaching defense improvements in the peacetime history of this country. And we have maintained the frontiers of freedom from Viet-Nam to West Berlin. But complacency or self-congratulation can imperil our security as much as the weapons of tyranny. A moment of pause is not a promise of peace. Dangerous problems remain from Cuba to the South China Sea. The world's prognosis prescribes, in short, not a year's vacation for us, but a year of obligation and opportunity. Four special avenues of opportunity stand out: the Atlantic Alliance, the developing nations, the new Sino-Soviet difficulties, and the search for worldwide peace. V. First, how fares the grand alliance? Free Europe is entering into a new phase of its long and brilliant history. The era of colonial expansion has passed; the era of national rivalries is fading; and a new era of interdependence and unity is taking shape. Defying the old prophecies of Marx, consenting to what no conqueror could ever compel, the free nations of Europe are moving toward a unity of purpose and power and policy in every sphere of activity. For 17 years this movement has had our consistent support, both political and economic. Far from resenting the new Europe, we regard her as a welcome partner, not a rival. For the road to world peace and freedom is still long, and there are burdens which only full partners can share--in supporting the common defense, in expanding world trade, in aligning our balance of payments, in aiding the emergent nations, in concerting political and economic policies, and in welcoming to our common effort other industrialized nations, notably Japan, whose remarkable economic and political development of the 1950's permits it now to play on the world scene a major constructive role. No doubt differences of opinion will continue to get more attention than agreements on action, as Europe moves from independence to more formal interdependence. But these are honest differences among honorable associates--more real and frequent, in fact, among our Western European allies than between them and the United States. For the unity of freedom has never relied on uniformity of opinion. But the basic agreement of this alliance on fundamental issues continues. The first task of the alliance remains the common defense. Last month Prime Minister Macmillan and I laid plans for a new stage in our long cooperative effort, one which aims to assist in the wider task of framing a common nuclear defense for the whole alliance. The Nassau agreement recognizes that the security of the West is indivisible, and so must be our defense. But it also recognizes that this is an alliance of proud and sovereign nations, and works best when we do not forget it. It recognizes further that the nuclear defense of the West is not a matter for the present nuclear powers alone--that France will be such a power in the future--and that ways must be found without increasing the hazards of nuclear diffusion, to increase the role of our other partners in planning, manning, and directing a truly multilateral nuclear force within an increasingly intimate NATO alliance. Finally, the Nassau agreement recognizes that nuclear defense is not enough, that the agreed NATO levels of conventional strength must be met, and that the alliance cannot afford to be in a position of having to answer every threat with nuclear weapons or nothing. We remain too near the Nassau decisions, and too far from their full realization, to know their place in history. But I believe that, for the first time, the door is open for the nuclear defense of the alliance to become a source of confidence, instead of a because of contention. The next most pressing concern of the alliance is our common economic goals of trade and growth. This Nation continues to be concerned about its balance-of-payments deficit, which, despite its decline, remains a stubborn and troublesome problem. We believe, moreover, that closer economic ties among all free nations are essential to prosperity and peace. And neither we nor the members of the European Common Market are so affluent that we can long afford to shelter high cost farms or factories from the winds of foreign competition, or to restrict the channels of trade with other nations of the free world. If the Common Market should move toward protectionism and restrictionism, it would undermine its, own basic principles. This Government means to use the authority conferred on it last year by the Congress to encourage trade expansion on both sides of the Atlantic and around the world. VI, Second, what of the developing and nonaligned nations? They were shocked by the Soviets' sudden and secret attempt to transform Cuba into a nuclear striking base--and by Communist China's arrogant invasion of India. They have been reassured by our prompt assistance to India, by our support through the United Nations of the Congo's unification, by our patient search for disarmament, and by the improvement in our treatment of citizens and visitors whose skins do not happen to be white. And as the older colonialism recedes, and the neocolonialism of the Communist powers stands out more starkly than ever, they realize more clearly that the issue in the world struggle is not communism versus capitalism, but coercion versus free choice. They are beginning to realize that the longing for independence is the same the world over, whether it is the independence of West Berlin or Viet-Nam. They are beginning to realize that such independence runs athwart all Communist ambitions but is in keeping with our own--and that our approach to their diverse needs is resilient and resourceful, while the Communists are still relying on ancient doctrines and dogmas. Nevertheless it is hard for any nation to focus on an external or subversive threat to its independence when its energies are drained in daily combat with the forces of poverty and despair. It makes little sense for us to assail, in speeches and resolutions, the horrors of communism, to spend $50 billion a year to prevent its military advance--and then to begrudge spending, largely on American products, less than one-tenth of that amount to help other nations strengthen their independence and cure the social chaos in which communism always has thrived. I am proud--and I think most Americans are proud--of a mutual defense and assistance program, evolved with bipartisan support in three administrations, which has, with all its recognized problems, contributed to the fact that not a single one of the nearly fifty YOU.N. members to gain independence since the Second World War has succumbed to Communist control. I am proud of a program that has helped to arm and feed and clothe millions of people who live on the front lines of freedom. I am especially proud that this country has put forward for the 60's a vast cooperative effort to achieve economic growth and social progress throughout the Americas--the Alliance for Progress. I do not underestimate the difficulties that we face in this mutual effort among our close neighbors, but the free states of this hemisphere, working in close collaboration, have begun to make this alliance a living reality. Today it is feeding one out of every four school age children in Latin America an extra food ration from our farm surplus. It has distributed 1.5 million school books and is building 17,000 classrooms. It has helped resettle tens of thousands of farm families on land they can call their own. It is stimulating our good neighbors to more self-help and self-reform--fiscal, social, institutional, and land reforms. It is bringing new housing and hope, new health and dignity, to millions who were forgotten. The men and women of this hemisphere know that the alliance cannot Succeed if it is only another name for United States handouts--that it can succeed only as the Latin American nations themselves devote their best effort to fulfilling its goals. This story is the same in Africa, in the Middle East, and in Asia. Wherever nations are willing to help themselves, we stand ready to help them build new bulwarks of freedom. We are not purchasing votes for the cold war; we have gone to the aid of imperiled nations, neutrals and allies alike. What we do ask--and all that we ask--is that our help be used to best advantage, and that their own efforts not be diverted by needless quarrels with other independent nations. Despite all its past achievements, the continued progress of the mutual assistance program requires a persistent discontent with present performance. We have been reorganizing this program to make it a more effective, efficient instrument--and that process will continue this year. But free world development will still be an uphill struggle. Government aid can only supplement the role of private investment, trade expansion, commodity stabilization, and, above all, internal self-improvement. The processes of growth are gradual--bearing fruit in a decade, not a day. Our successes will be neither quick nor dramatic. But if these programs were ever to be ended, our failures in a dozen countries would be sudden and certain. Neither money nor technical assistance, however, can be our only weapon against poverty. In the end, the crucial effort is one of purpose, requiring the fuel of finance but also a torch of idealism. And nothing carries the spirit of this American idealism more effectively to the far corners of the earth than the American Peace Corps. A year ago, less than 900 Peace Corps volunteers were on the job. A year from now they will number more than 9,000--men and women, aged 18 to 79, willing to give 2 years of their lives to helping people in other lands. There are, in fact, nearly a million Americans serving their country and the because of freedom in overseas posts, a record no other people can match. Surely those of us who stay at home should be glad to help indirectly; by supporting our aid programs; .by opening our doors to foreign visitors and diplomats and students; and by proving, day by day, by deed as well as word, that we are a just and generous people. VII. Third, what comfort can we take from the increasing strains and tensions within the Communist bloc? Here hope must be tempered with caution. For the Soviet-Chinese disagreement is over means, not ends. A dispute over how best to bury the free world is no grounds for Western rejoicing. Nevertheless, while a strain is not a fracture, it is clear that the forces of diversity are at work inside the Communist camp, despite all the iron disciplines of regimentation and all the iron dogmatism's of ideology. Marx is proven wrong once again: for it is the closed Communist societies, not the free and open societies which carry within themselves the seeds of internal disintegration. The disarray of the Communist empire has been heightened by two other formidable forces. One is the historical force of nationalism--and the yearning of all men to be free. The other is the gross inefficiency of their economies. For a closed society is not open to ideas of progress--and a police state finds that it cannot command the grain to grow. New nations asked to choose between two competing systems need only compare conditions in East and West Germany, Eastern and Western Europe, North and South Viet-Nam. They need only compare the disillusionment of Communist Cuba with the promise of the Alliance for Progress. And all the world knows that no successful system builds a wall to keep its people in and freedom out--and the wall of shame dividing Berlin is a symbol of Communist failure. VIII. Finally, what can we do to move from the present pause toward enduring peace? Again I would counsel caution. I foresee no spectacular reversal in Communist methods or goals. But if all these trends and developments can persuade the Soviet Union to walk the path of peace, then let her know that all free nations will journey with her. But until that choice is made, and until the world can develop a reliable system of international security, the free peoples have no choice but to keep their arms nearby. This country, therefore, continues to require the best defense in the world--a defense which is suited to the sixties. This means, unfortunately, a rising defense budget--for there is no substitute for adequate defense, and no "bargain basement" way of achieving it. It means the expenditure of more than $15 billion this year on nuclear weapons systems alone, a sum which is about equal to the combined defense budgets of our European Allies. But it also means improved air and missile defenses, improved civil defense, a strengthened anti-guerrilla capacity and, of prime importance, more powerful and flexible nonnuclear forces. For threats of massive retaliation may not deter piecemeal aggression--and a line of destroyers in a quarantine, or a division of well-equipped men on a border, may be more useful to our real security than the multiplication of awesome weapons beyond all rational need. But our commitment to national safety is not a commitment to expand our military establishment indefinitely. We do not dismiss disarmament as merely an idle dream. For we believe that, in the end, it is the only way to assure the security of all without impairing the interests of any. Nor do we mistake honorable negotiation for appeasement. While we shall never weary in the defense of freedom, neither shall we ever abandon the pursuit of peace. In this quest, the United Nations requires our full and continued support. Its value in serving the because of peace has been shown anew in its role in the West New Guinea settlement, in its use as a forum for the Cuban crisis, and in its task of unification in the Congo. Today the United Nations is primarily the protector of the small and the weak, and a safety valve for the strong. Tomorrow it can form the framework for a world of law--a world in which no nation dictates the destiny of another, and in which the vast resources now devoted to destructive means will serve constructive ends. In short, let our adversaries choose. If they choose peaceful competition, they shall have it. If they come to realize that their ambitions cannot succeed--if they see their "wars of liberation" and subversion will ultimately fail--if they recognize that there is more security in accepting inspection than in permitting new nations to master the black arts of nuclear war--and if they are willing to turn their energies, as we are, to the great unfinished tasks of our own peoples--then, surely, the areas of agreement can be very wide indeed: a clear understanding about Berlin, stability in Southeast Asia, an end to nuclear testing, new checks on surprise or accidental attack, and, ultimately, general and complete disarmament. IX. For we seek not the worldwide victory of one nation or system but a worldwide victory of man. The modern globe is too small, its weapons are too destructive, and its disorders are too contagious to permit any other kind of victory. To achieve this end, the United States will continue to spend a greater portion of its national production than any other people in the free world. For 15 years no other free nation has demanded so much of itself. Through hot wars and cold, through recession and prosperity, through the ages of the atom and outer space, the American people have never faltered and their faith has never flagged. If at times our actions seem to make life difficult for others, it is only because history has made life difficult for us all. But difficult days need not be dark. I think these are proud and memorable days in the because of peace and freedom. We are proud, for example, of Major Rudolf Anderson who gave his life over the island of Cuba. We salute Specialist James Allen Johnson who died on the border of South Korea. We pay honor to Sergeant Gerald Pendell who was killed in Viet-Nam. They are among the many who in this century, far from home, have died for our country. Our task now, and the task of all Americans is to live up to their commitment. My friends: I close on a note of hope. We are not lulled by the momentary calm of the sea or the somewhat clearer skies above. We know the turbulence that lies below, and the storms that are beyond the horizon this year. But now the winds of change appear to be blowing more strongly than ever, in the world of communism as well as our own. For 175 years we have sailed with those winds at our back, and with the tides of human freedom in our favor. We steer our ship with hope, as Thomas Jefferson said, "leaving Fear astern." Today we still welcome those winds of change--and we have every reason to believe that our tide is running strong. With thanks to Almighty God for seeing us through a perilous passage, we ask His help anew in guiding the "Good Ship Union."
as delivered in person before a joint session vice president speaker members of the 88th congress i congratulate you all not merely on your electoral victory but on your selected role in history for you and i are privileged to serve the great republic in what could be the most decisive decade in its long history the choices we make for good or ill may well shape the state of the union for generations yet to come little more than 100 weeks ago i assumed the office of president of the united states in seeking the help of the congress and our countrymen i pledged no easy answers i pledged and asked only toil and dedication these the congress and the people have given in good measure and today having witnessed in recent months a heightened respect for our national purpose and power having seen the courageous calm of a united people in a perilous hour and having observed a steady improvement in the opportunities and of our citizens i can report to you that the state of this old but youthful union in the 175th year of its life is good in the world beyond our borders steady progress has been made in building a world of order the people of west berlin remain both free and secure a settlement though still precarious has been reached in laos the spearpoint of aggression has been blunted in the end of agony may be in sight in the congo the doctrine of troika is dead and while danger continues a deadly threat has been removed in cuba at home the recession is behind us well over a million more men and women are working today than were working 2 years ago the average factory workweek is once again more than 40 hours our industries are turning out more goods than ever before and more than half of the manufacturing capacity that lay silent and wasted 100 weeks ago is humming with activity in short both at home and abroad there may now be a temptation to relax for the road has been long the burden heavy and the pace consistently urgent but we can not be satisfied to rest here this is the side of the hill not the top the mere absence of war is not peace the mere absence of recession is not growth we have made a beginning but we have only begun now the time has come to make the most of our gains to translate the renewal of our national strength into the achievement of our national purpose ii america has enjoyed 22 months of uninterrupted economic recovery but recovery is not enough if we are to prevail in the long run we must expand the strength of our economy we must move along the path to a higher rate of growth and full employment for this would mean tens of billions of dollars more each year in production profits wages and public revenues it would mean an end to the persistent slack which has kept our unemployment at or above 5 percent for 61 out of the past 62 months and an end to the growing pressures for such restrictive measures as the week which alone could increase hourly labor costs by as much as 14 percent start a new spiral of inflation and undercut our efforts to compete with other nations to achieve these greater gains one step above all is essential the enactment this year of a substantial reduction and revision in federal income taxes for it is increasingly clear to those in government business and labor who are responsible for our economy success that our obsolete tax system exerts too heavy a drag on private purchasing power profits and employment designed to check inflation in earlier years it now checks growth instead it discourages extra effort and risk it distorts the use of resources it invites recurrent recessions depresses our federal revenues and causes chronic budget deficits now when the inflationary pressures of the war and the years no longer threaten and the dollar commands new respect now when no military crisis strains our resources now is the time to act we can not afford to be timid or slow for this is the most urgent task confronting the congress in 1963 in an early message i shall propose a permanent reduction in tax rates which will lower liabilities by billion of this 11 billion results from reducing individual tax rates which now range between 20 and 91 percent to a more sensible range of 14 to 65 percent with a split in the present first bracket two and billion dollars results from reducing corporate tax rates from 52 percent which gives the government today a majority interest in profits to the permanent level of 47 percent this is in addition to the more than 2 billion cut in corporate tax liabilities resulting from last year investment credit and depreciation reform to achieve this reduction within the limits of a manageable budgetary deficit i urge first that these cuts be phased over 3 calendar years beginning in 1963 with a cut of some 6 billion at annual rates second that these reductions be coupled with selected structural changes beginning in 1964 which will broaden the tax base end unfair or unnecessary preferences remove or lighten certain hardships and in the net offset some billion of the revenue loss and third that budgetary receipts at the outset be increased by billion a year without any change in tax liabilities by gradually shifting the tax payments of large corporations to a more current time schedule this combined program by increasing the amount of our national income will in time result in still higher federal revenues it is a fiscally responsible program the surest and the soundest way of achieving in time a balanced budget in a balanced full employment economy this net reduction in tax liabilities of 10 billion will increase the purchasing power of american families and business enterprises in every tax bracket with greatest increase going to our consumers it will in addition encourage the initiative and on which our free system depends induce more investment production and capacity use help provide the 2 million new jobs we need every year and reinforce the american principle of additional reward for additional effort i do not say that a measure for tax reduction and reform is the only way to achieve these goals no doubt a massive increase in federal spending could also create jobs and growth but in today setting private consumers employers and investors should be given a full opportunity first no doubt a temporary tax cut could provide a spur to our economy but a long run problem compels a solution no doubt a reduction in either individual or corporation taxes alone would be of great help but corporations need customers and job seekers need jobs no doubt tax reduction without reform would sound simpler and more attractive to many but our growth is also hampered by a host of tax inequities and special preferences which have distorted the flow of investment and finally there are no doubt some who would prefer to put off a tax cut in the hope that ultimately an end to the cold war would make possible an equivalent cut in expenditures but that end is not in view and to wait for it would be costly and in submitting a tax program which will of course temporarily increase the deficit but can ultimately end it and in recognition of the need to control expenditures i will shortly submit a fiscal 1964 administrative budget which while allowing for needed rises in defense space and fixed interest charges holds total expenditures for all other purposes below this year level this requires the reduction or postponement of many desirable programs the absorption of a large part of last year federal pay raise through personnel and other economies the termination of certain installations and projects and the substitution in several programs of private for public credit but i am convinced that the enactment this year of tax reduction and tax reform overshadows all other domestic problems in this congress for we can not for long lead the because of peace and freedom if we ever cease to set the pace here at home iii tax reduction alone however is not enough to strengthen our society to provide opportunities for the four million americans who are born every year to improve the lives of 32 million americans who live on the outskirts of poverty the quality of american life must keep pace with the quantity of american goods this country can not afford to be materially rich and spiritually poor therefore by holding down the budgetary cost of existing programs to keep within the limitations i have set it is both possible and imperative to adopt other new measures that we can not afford to postpone these measures are based on a series of fundamental premises grouped under four related headings first we need to strengthen our nation by investing in our youth the future of any country which is dependent upon the will and wisdom of its citizens is damaged and irreparably damaged whenever any of its children is not educated to the full extent of his talent from grade school through graduate school today an estimated 4 out of every 10 students in the 5th grade will not even finish high school and that is a waste we can not afford in addition there is no reason why one million young americans out of school and out of work should all remain unwanted and often untrained on our city streets when their energies can be put to good use finally the overseas success of our peace corps volunteers most of them young men and women carrying skills and ideas to needy people suggests the merit of a similar corps serving our own community needs in mental hospitals on indian reservations in centers for the aged or for young delinquents in schools for the illiterate or the handicapped as the idealism of our youth has served world peace so can it serve the domestic tranquility second we need to strengthen our nation by safeguarding its health our working men and women instead of being forced to beg for help from public charity once they are old and ill should start contributing now to their own retirement health program through the social security system moreover all our miracles of medical research will count for little if we can not reverse the growing nationwide shortage of doctors dentists and nurses and the widespread shortages of nursing homes and modern urban hospital facilities merely to keep the present ratio of doctors and dentists from declining any further we must over the next 10 years increase the capacity of our medical schools by 50 percent and our dental schools by 100 percent finally and of deep concern i believe that the abandonment of the mentally ill and the mentally retarded to the grim mercy of custodial institutions too often inflicts on them and on their families a needless cruelty which this nation should not endure the incidence of mental retardation in this country is three times as high as that of sweden for example and that figure can and must be reduced third we need to strengthen our nation by protecting the basic rights of its citizens the right to competent counsel must be assured to every man accused of crime in federal court regardless of his means and the most precious and powerful right in the world the right to vote in a free american election must not be denied to any citizen on grounds of his race or color i wish that all qualified americans permitted to vote were willing to vote but surely in this centennial year of emancipation all those who are willing to vote should always be permitted fourth we need to strengthen our nation by making the best and the most economical use of its resources and facilities our economic health depends on healthy transportation arteries and i believe the way to a more modern economical choice of national transportation service is through increased competition and decreased regulation local mass transit faring even worse is as essential a community service as hospitals and highways nearly of our citizens live in urban areas which occupy only 2 percent of our land and if local transit is to survive and relieve the congestion of these cities it needs federal stimulation and assistance next this government is in the storage and stockpile business to the melancholy tune of more than 16 billion we must continue to support farm income but we should not pile more farm surpluses on top of the billion we already own we must maintain a stockpile of strategic materials but the billion we have acquired for reasons both good and bad is much more than we need and we should be empowered to dispose of the excess in ways which will not because market disruption finally our already overcrowded national parks and recreation areas will have twice as many visitors 10 years from now as they do today if we do not plan today for the future growth of these and other great natural assets not only parks and forests but wildlife and wilderness preserves and water projects of all kinds our children and their children will be poorer in every sense of the word these are not domestic concerns alone for upon our achievement of greater vitality and strength here at home hang our fate and future in the world our ability to sustain and supply the security of free men and nations our ability to command their respect for our leadership our ability to expand our trade without threat to our balance of payments and our ability to adjust to the changing demands of cold war competition and challenge we shall be judged more by what we do at home than by what we preach abroad nothing we could do to help the developing countries would help them half as much as a booming economy and nothing our opponents could do to encourage their own ambitions would encourage them half as much as a chronic lagging economy these domestic tasks do not divert energy from our security they provide the very foundation for freedom survival and success iv turning to the world outside it was only a few years ago in southeast asia africa eastern europe latin america even outer space that communism sought to convey the image of a unified confident and expanding empire closing in on a sluggish america and a free world in disarray but few people would hold to that picture today in these past months we have reaffirmed the scientific and military superiority of freedom we have doubled our efforts in space to assure us of being first in the future we have undertaken the most defense improvements in the peacetime history of this country and we have maintained the frontiers of freedom from to west berlin but complacency or can imperil our security as much as the weapons of tyranny a moment of pause is not a promise of peace dangerous problems remain from cuba to the south china sea the world prognosis prescribes in short not a year vacation for us but a year of obligation and opportunity four special avenues of opportunity stand out the atlantic alliance the developing nations the new difficulties and the search for worldwide peace first how fares the grand alliance free europe is entering into a new phase of its long and brilliant history the era of colonial expansion has passed the era of national rivalries is fading and a new era of interdependence and unity is taking shape defying the old prophecies of marx consenting to what no conqueror could ever compel the free nations of europe are moving toward a unity of purpose and power and policy in every sphere of activity for 17 years this movement has had our consistent support both political and economic far from resenting the new europe we regard her as a welcome partner not a rival for the road to world peace and freedom is still long and there are burdens which only full partners can share in supporting the common defense in expanding world trade in aligning our balance of payments in aiding the emergent nations in concerting political and economic policies and in welcoming to our common effort other industrialized nations notably japan whose remarkable economic and political development of the 1950 permits it now to play on the world scene a major constructive role no doubt differences of opinion will continue to get more attention than agreements on action as europe moves from independence to more formal interdependence but these are honest differences among honorable associates more real and frequent in fact among our western european allies than between them and the united states for the unity of freedom has never relied on uniformity of opinion but the basic agreement of this alliance on fundamental issues continues the first task of the alliance remains the common defense last month prime minister macmillan and i laid plans for a new stage in our long cooperative effort one which aims to assist in the wider task of framing a common nuclear defense for the whole alliance the nassau agreement recognizes that the security of the west is indivisible and so must be our defense but it also recognizes that this is an alliance of proud and sovereign nations and works best when we do not forget it it recognizes further that the nuclear defense of the west is not a matter for the present nuclear powers alone that france will be such a power in the future and that ways must be found without increasing the hazards of nuclear diffusion to increase the role of our other partners in planning manning and directing a truly multilateral nuclear force within an increasingly intimate nato alliance finally the nassau agreement recognizes that nuclear defense is not enough that the agreed nato levels of conventional strength must be met and that the alliance can not afford to be in a position of having to answer every threat with nuclear weapons or nothing we remain too near the nassau decisions and too far from their full realization to know their place in history but i believe that for the first time the door is open for the nuclear defense of the alliance to become a source of confidence instead of a because of contention the next most pressing concern of the alliance is our common economic goals of trade and growth this nation continues to be concerned about its deficit which despite its decline remains a stubborn and troublesome problem we believe moreover that closer economic ties among all free nations are essential to prosperity and peace and neither we nor the members of the european common market are so affluent that we can long afford to shelter high cost farms or factories from the winds of foreign competition or to restrict the channels of trade with other nations of the free world if the common market should move toward protectionism and restrictionism it would undermine its own basic principles this government means to use the authority conferred on it last year by the congress to encourage trade expansion on both sides of the atlantic and around the world vi second what of the developing and nonaligned nations they were shocked by the soviets sudden and secret attempt to transform cuba into a nuclear striking base and by communist china arrogant invasion of india they have been reassured by our prompt assistance to india by our support through the united nations of the congo unification by our patient search for disarmament and by the improvement in our treatment of citizens and visitors whose skins do not happen to be white and as the older colonialism recedes and the neocolonialism of the communist powers stands out more starkly than ever they realize more clearly that the issue in the world struggle is not communism versus capitalism but coercion versus free choice they are beginning to realize that the longing for independence is the same the world over whether it is the independence of west berlin or they are beginning to realize that such independence runs athwart all communist ambitions but is in keeping with our own and that our approach to their diverse needs is resilient and resourceful while the communists are still relying on ancient doctrines and dogmas nevertheless it is hard for any nation to focus on an external or subversive threat to its independence when its energies are drained in daily combat with the forces of poverty and despair it makes little sense for us to assail in speeches and resolutions the horrors of communism to spend 50 billion a year to prevent its military advance and then to begrudge spending largely on american products less than of that amount to help other nations strengthen their independence and cure the social chaos in which communism always has thrived i am proud and i think most americans are proud of a mutual defense and assistance program evolved with bipartisan support in three administrations which has with all its recognized problems contributed to the fact that not a single one of the nearly fifty members to gain independence since the second world war has succumbed to communist control i am proud of a program that has helped to arm and feed and clothe millions of people who live on the front lines of freedom i am especially proud that this country has put forward for the 60 a vast cooperative effort to achieve economic growth and social progress throughout the americas the alliance for progress i do not underestimate the difficulties that we face in this mutual effort among our close neighbors but the free states of this hemisphere working in close collaboration have begun to make this alliance a living reality today it is feeding one out of every four school age children in latin america an extra food ration from our farm surplus it has distributed million school books and is building classrooms it has helped resettle tens of thousands of farm families on land they can call their own it is stimulating our good neighbors to more and fiscal social institutional and land reforms it is bringing new housing and hope new health and dignity to millions who were forgotten the men and women of this hemisphere know that the alliance can not succeed if it is only another name for united states handouts that it can succeed only as the latin american nations themselves devote their best effort to fulfilling its goals this story is the same in africa in the middle east and in asia wherever nations are willing to help themselves we stand ready to help them build new bulwarks of freedom we are not purchasing votes for the cold war we have gone to the aid of imperiled nations neutrals and allies alike what we do ask and all that we ask is that our help be used to best advantage and that their own efforts not be diverted by needless quarrels with other independent nations despite all its past achievements the continued progress of the mutual assistance program requires a persistent discontent with present performance we have been reorganizing this program to make it a more effective efficient instrument and that process will continue this year but free world development will still be an uphill struggle government aid can only supplement the role of private investment trade expansion commodity stabilization and above all internal the processes of growth are gradual bearing fruit in a decade not a day our successes will be neither quick nor dramatic but if these programs were ever to be ended our failures in a dozen countries would be sudden and certain neither money nor technical assistance however can be our only weapon against poverty in the end the crucial effort is one of purpose requiring the fuel of finance but also a torch of idealism and nothing carries the spirit of this american idealism more effectively to the far corners of the earth than the american peace corps a year ago less than 900 peace corps volunteers were on the job a year from now they will number more than men and women aged 18 to 79 willing to give 2 years of their lives to helping people in other lands there are in fact nearly a million americans serving their country and the because of freedom in overseas posts a record no other people can match surely those of us who stay at home should be glad to help indirectly by supporting our aid programs opening our doors to foreign visitors and diplomats and students and by proving day by day by deed as well as word that we are a just and generous people vii third what comfort can we take from the increasing strains and tensions within the communist bloc here hope must be tempered with caution for the disagreement is over means not ends a dispute over how best to bury the free world is no grounds for western rejoicing nevertheless while a strain is not a fracture it is clear that the forces of diversity are at work inside the communist camp despite all the iron disciplines of regimentation and all the iron dogmatism of ideology marx is proven wrong once again for it is the closed communist societies not the free and open societies which carry within themselves the seeds of internal disintegration the disarray of the communist empire has been heightened by two other formidable forces one is the historical force of nationalism and the yearning of all men to be free the other is the gross inefficiency of their economies for a closed society is not open to ideas of progress and a police state finds that it can not command the grain to grow new nations asked to choose between two competing systems need only compare conditions in east and west germany eastern and western europe north and south they need only compare the disillusionment of communist cuba with the promise of the alliance for progress and all the world knows that no successful system builds a wall to keep its people in and freedom out and the wall of shame dividing berlin is a symbol of communist failure viii finally what can we do to move from the present pause toward enduring peace again i would counsel caution i foresee no spectacular reversal in communist methods or goals but if all these trends and developments can persuade the soviet union to walk the path of peace then let her know that all free nations will journey with her but until that choice is made and until the world can develop a reliable system of international security the free peoples have no choice but to keep their arms nearby this country therefore continues to require the best defense in the world a defense which is suited to the sixties this means unfortunately a rising defense budget for there is no substitute for adequate defense and no bargain basement way of achieving it it means the expenditure of more than 15 billion this year on nuclear weapons systems alone a sum which is about equal to the combined defense budgets of our european allies but it also means improved air and missile defenses improved civil defense a strengthened capacity and of prime importance more powerful and flexible nonnuclear forces for threats of massive retaliation may not deter piecemeal aggression and a line of destroyers in a quarantine or a division of men on a border may be more useful to our real security than the multiplication of awesome weapons beyond all rational need but our commitment to national safety is not a commitment to expand our military establishment indefinitely we do not dismiss disarmament as merely an idle dream for we believe that in the end it is the only way to assure the security of all without impairing the interests of any nor do we mistake honorable negotiation for appeasement while we shall never weary in the defense of freedom neither shall we ever abandon the pursuit of peace in this quest the united nations requires our full and continued support its value in serving the because of peace has been shown anew in its role in the west new guinea settlement in its use as a forum for the cuban crisis and in its task of unification in the congo today the united nations is primarily the protector of the small and the weak and a safety valve for the strong tomorrow it can form the framework for a world of law a world in which no nation dictates the destiny of another and in which the vast resources now devoted to destructive means will serve constructive ends in short let our adversaries choose if they choose peaceful competition they shall have it if they come to realize that their ambitions can not succeed if they see their wars of liberation and subversion will ultimately fail if they recognize that there is more security in accepting inspection than in permitting new nations to master the black arts of nuclear war and if they are willing to turn their energies as we are to the great unfinished tasks of our own peoples then surely the areas of agreement can be very wide indeed a clear understanding about berlin stability in southeast asia an end to nuclear testing new checks on surprise or accidental attack and ultimately general and complete disarmament ix for we seek not the worldwide victory of one nation or system but a worldwide victory of man the modern globe is too small its weapons are too destructive and its disorders are too contagious to permit any other kind of victory to achieve this end the united states will continue to spend a greater portion of its national production than any other people in the free world for 15 years no other free nation has demanded so much of itself through hot wars and cold through recession and prosperity through the ages of the atom and outer space the american people have never faltered and their faith has never flagged if at times our actions seem to make life difficult for others it is only because history has made life difficult for us all but difficult days need not be dark i think these are proud and memorable days in the because of peace and freedom we are proud for example of major rudolf anderson who gave his life over the island of cuba we salute specialist james allen johnson who died on the border of south korea we pay honor to sergeant gerald pendell who was killed in they are among the many who in this century far from home have died for our country our task now and the task of all americans is to live up to their commitment my friends i close on a note of hope we are not lulled by the momentary calm of the sea or the somewhat clearer skies above we know the turbulence that lies below and the storms that are beyond the horizon this year but now the winds of change appear to be blowing more strongly than ever in the world of communism as well as our own for 175 years we have sailed with those winds at our back and with the tides of human freedom in our favor we steer our ship with hope as thomas jefferson said leaving fear astern today we still welcome those winds of change and we have every reason to believe that our tide is running strong with thanks to almighty god for seeing us through a perilous passage we ask his help anew in guiding the good ship union
delivered person joint session vice president speaker members 88th congress congratulate merely electoral victory selected role history privileged serve great republic could decisive decade long history choices make good ill may well shape state union generations yet come little 100 weeks ago assumed office president united states seeking help congress countrymen pledged easy answers pledged asked toil dedication congress people given good measure today witnessed recent months heightened respect national purpose power seen courageous calm united people perilous hour observed steady improvement opportunities citizens report state old youthful union 175th year life good world beyond borders steady progress made building world order people west berlin remain free secure settlement though still precarious reached laos spearpoint aggression blunted end agony may sight congo doctrine troika dead danger continues deadly threat removed cuba home recession behind us well million men women working today working 2 years ago average factory workweek 40 hours industries turning goods ever half manufacturing capacity lay silent wasted 100 weeks ago humming activity short home abroad may temptation relax road long burden heavy pace consistently urgent satisfied rest side hill top mere absence war peace mere absence recession growth made beginning begun time come make gains translate renewal national strength achievement national purpose ii america enjoyed 22 months uninterrupted economic recovery recovery enough prevail long run must expand strength economy must move along path higher rate growth full employment would mean tens billions dollars year production profits wages public revenues would mean end persistent slack kept unemployment 5 percent 61 past 62 months end growing pressures restrictive measures week alone could increase hourly labor costs much 14 percent start new spiral inflation undercut efforts compete nations achieve greater gains one step essential enactment year substantial reduction revision federal income taxes increasingly clear government business labor responsible economy success obsolete tax system exerts heavy drag private purchasing power profits employment designed check inflation earlier years checks growth instead discourages extra effort risk distorts use resources invites recurrent recessions depresses federal revenues causes chronic budget deficits inflationary pressures war years longer threaten dollar commands new respect military crisis strains resources time act afford timid slow urgent task confronting congress 1963 early message shall propose permanent reduction tax rates lower liabilities billion 11 billion results reducing individual tax rates range 20 91 percent sensible range 14 65 percent split present first bracket two billion dollars results reducing corporate tax rates 52 percent gives government today majority interest profits permanent level 47 percent addition 2 billion cut corporate tax liabilities resulting last year investment credit depreciation reform achieve reduction within limits manageable budgetary deficit urge first cuts phased 3 calendar years beginning 1963 cut 6 billion annual rates second reductions coupled selected structural changes beginning 1964 broaden tax base end unfair unnecessary preferences remove lighten certain hardships net offset billion revenue loss third budgetary receipts outset increased billion year without change tax liabilities gradually shifting tax payments large corporations current time schedule combined program increasing amount national income time result still higher federal revenues fiscally responsible program surest soundest way achieving time balanced budget balanced full employment economy net reduction tax liabilities 10 billion increase purchasing power american families business enterprises every tax bracket greatest increase going consumers addition encourage initiative free system depends induce investment production capacity use help provide 2 million new jobs need every year reinforce american principle additional reward additional effort say measure tax reduction reform way achieve goals doubt massive increase federal spending could also create jobs growth today setting private consumers employers investors given full opportunity first doubt temporary tax cut could provide spur economy long run problem compels solution doubt reduction either individual corporation taxes alone would great help corporations need customers job seekers need jobs doubt tax reduction without reform would sound simpler attractive many growth also hampered host tax inequities special preferences distorted flow investment finally doubt would prefer put tax cut hope ultimately end cold war would make possible equivalent cut expenditures end view wait would costly submitting tax program course temporarily increase deficit ultimately end recognition need control expenditures shortly submit fiscal 1964 administrative budget allowing needed rises defense space fixed interest charges holds total expenditures purposes year level requires reduction postponement many desirable programs absorption large part last year federal pay raise personnel economies termination certain installations projects substitution several programs private public credit convinced enactment year tax reduction tax reform overshadows domestic problems congress long lead peace freedom ever cease set pace home iii tax reduction alone however enough strengthen society provide opportunities four million americans born every year improve lives 32 million americans live outskirts poverty quality american life must keep pace quantity american goods country afford materially rich spiritually poor therefore holding budgetary cost existing programs keep within limitations set possible imperative adopt new measures afford postpone measures based series fundamental premises grouped four related headings first need strengthen nation investing youth future country dependent upon wisdom citizens damaged irreparably damaged whenever children educated full extent talent grade school graduate school today estimated 4 every 10 students 5th grade even finish high school waste afford addition reason one million young americans school work remain unwanted often untrained city streets energies put good use finally overseas success peace corps volunteers young men women carrying skills ideas needy people suggests merit similar corps serving community needs mental hospitals indian reservations centers aged young delinquents schools illiterate handicapped idealism youth served world peace serve domestic tranquility second need strengthen nation safeguarding health working men women instead forced beg help public charity old ill start contributing retirement health program social security system moreover miracles medical research count little reverse growing nationwide shortage doctors dentists nurses widespread shortages nursing homes modern urban hospital facilities merely keep present ratio doctors dentists declining must next 10 years increase capacity medical schools 50 percent dental schools 100 percent finally deep concern believe abandonment mentally ill mentally retarded grim mercy custodial institutions often inflicts families needless cruelty nation endure incidence mental retardation country three times high sweden example figure must reduced third need strengthen nation protecting basic rights citizens right competent counsel must assured every man accused crime federal court regardless means precious powerful right world right vote free american election must denied citizen grounds race color wish qualified americans permitted vote willing vote surely centennial year emancipation willing vote always permitted fourth need strengthen nation making best economical use resources facilities economic health depends healthy transportation arteries believe way modern economical choice national transportation service increased competition decreased regulation local mass transit faring even worse essential community service hospitals highways nearly citizens live urban areas occupy 2 percent land local transit survive relieve congestion cities needs federal stimulation assistance next government storage stockpile business melancholy tune 16 billion must continue support farm income pile farm surpluses top billion already must maintain stockpile strategic materials billion acquired reasons good bad much need empowered dispose excess ways market disruption finally already overcrowded national parks recreation areas twice many visitors 10 years today plan today future growth great natural assets parks forests wildlife wilderness preserves water projects kinds children children poorer every sense word domestic concerns alone upon achievement greater vitality strength home hang fate future world ability sustain supply security free men nations ability command respect leadership ability expand trade without threat balance payments ability adjust changing demands cold war competition challenge shall judged home preach abroad nothing could help developing countries would help half much booming economy nothing opponents could encourage ambitions would encourage half much chronic lagging economy domestic tasks divert energy security provide foundation freedom survival success iv turning world outside years ago southeast asia africa eastern europe latin america even outer space communism sought convey image unified confident expanding empire closing sluggish america free world disarray people would hold picture today past months reaffirmed scientific military superiority freedom doubled efforts space assure us first future undertaken defense improvements peacetime history country maintained frontiers freedom west berlin complacency imperil security much weapons tyranny moment pause promise peace dangerous problems remain cuba south china sea world prognosis prescribes short year vacation us year obligation opportunity four special avenues opportunity stand atlantic alliance developing nations new difficulties search worldwide peace first fares grand alliance free europe entering new phase long brilliant history era colonial expansion passed era national rivalries fading new era interdependence unity taking shape defying old prophecies marx consenting conqueror could ever compel free nations europe moving toward unity purpose power policy every sphere activity 17 years movement consistent support political economic far resenting new europe regard welcome partner rival road world peace freedom still long burdens full partners share supporting common defense expanding world trade aligning balance payments aiding emergent nations concerting political economic policies welcoming common effort industrialized nations notably japan whose remarkable economic political development 1950 permits play world scene major constructive role doubt differences opinion continue get attention agreements action europe moves independence formal interdependence honest differences among honorable associates real frequent fact among western european allies united states unity freedom never relied uniformity opinion basic agreement alliance fundamental issues continues first task alliance remains common defense last month prime minister macmillan laid plans new stage long cooperative effort one aims assist wider task framing common nuclear defense whole alliance nassau agreement recognizes security west indivisible must defense also recognizes alliance proud sovereign nations works best forget recognizes nuclear defense west matter present nuclear powers alone france power future ways must found without increasing hazards nuclear diffusion increase role partners planning manning directing truly multilateral nuclear force within increasingly intimate nato alliance finally nassau agreement recognizes nuclear defense enough agreed nato levels conventional strength must met alliance afford position answer every threat nuclear weapons nothing remain near nassau decisions far full realization know place history believe first time door open nuclear defense alliance become source confidence instead contention next pressing concern alliance common economic goals trade growth nation continues concerned deficit despite decline remains stubborn troublesome problem believe moreover closer economic ties among free nations essential prosperity peace neither members european common market affluent long afford shelter high cost farms factories winds foreign competition restrict channels trade nations free world common market move toward protectionism restrictionism would undermine basic principles government means use authority conferred last year congress encourage trade expansion sides atlantic around world vi second developing nonaligned nations shocked soviets sudden secret attempt transform cuba nuclear striking base communist china arrogant invasion india reassured prompt assistance india support united nations congo unification patient search disarmament improvement treatment citizens visitors whose skins happen white older colonialism recedes neocolonialism communist powers stands starkly ever realize clearly issue world struggle communism versus capitalism coercion versus free choice beginning realize longing independence world whether independence west berlin beginning realize independence runs athwart communist ambitions keeping approach diverse needs resilient resourceful communists still relying ancient doctrines dogmas nevertheless hard nation focus external subversive threat independence energies drained daily combat forces poverty despair makes little sense us assail speeches resolutions horrors communism spend 50 billion year prevent military advance begrudge spending largely american products less amount help nations strengthen independence cure social chaos communism always thrived proud think americans proud mutual defense assistance program evolved bipartisan support three administrations recognized problems contributed fact single one nearly fifty members gain independence since second world war succumbed communist control proud program helped arm feed clothe millions people live front lines freedom especially proud country put forward 60 vast cooperative effort achieve economic growth social progress throughout americas alliance progress underestimate difficulties face mutual effort among close neighbors free states hemisphere working close collaboration begun make alliance living reality today feeding one every four school age children latin america extra food ration farm surplus distributed million school books building classrooms helped resettle tens thousands farm families land call stimulating good neighbors fiscal social institutional land reforms bringing new housing hope new health dignity millions forgotten men women hemisphere know alliance succeed another name united states handouts succeed latin american nations devote best effort fulfilling goals story africa middle east asia wherever nations willing help stand ready help build new bulwarks freedom purchasing votes cold war gone aid imperiled nations neutrals allies alike ask ask help used best advantage efforts diverted needless quarrels independent nations despite past achievements continued progress mutual assistance program requires persistent discontent present performance reorganizing program make effective efficient instrument process continue year free world development still uphill struggle government aid supplement role private investment trade expansion commodity stabilization internal processes growth gradual bearing fruit decade day successes neither quick dramatic programs ever ended failures dozen countries would sudden certain neither money technical assistance however weapon poverty end crucial effort one purpose requiring fuel finance also torch idealism nothing carries spirit american idealism effectively far corners earth american peace corps year ago less 900 peace corps volunteers job year number men women aged 18 79 willing give 2 years lives helping people lands fact nearly million americans serving country freedom overseas posts record people match surely us stay home glad help indirectly supporting aid programs opening doors foreign visitors diplomats students proving day day deed well word generous people vii third comfort take increasing strains tensions within communist bloc hope must tempered caution disagreement means ends dispute best bury free world grounds western rejoicing nevertheless strain fracture clear forces diversity work inside communist camp despite iron disciplines regimentation iron dogmatism ideology marx proven wrong closed communist societies free open societies carry within seeds internal disintegration disarray communist empire heightened two formidable forces one historical force nationalism yearning men free gross inefficiency economies closed society open ideas progress police state finds command grain grow new nations asked choose two competing systems need compare conditions east west germany eastern western europe north south need compare disillusionment communist cuba promise alliance progress world knows successful system builds wall keep people freedom wall shame dividing berlin symbol communist failure viii finally move present pause toward enduring peace would counsel caution foresee spectacular reversal communist methods goals trends developments persuade soviet union walk path peace let know free nations journey choice made world develop reliable system international security free peoples choice keep arms nearby country therefore continues require best defense world defense suited sixties means unfortunately rising defense budget substitute adequate defense bargain basement way achieving means expenditure 15 billion year nuclear weapons systems alone sum equal combined defense budgets european allies also means improved air missile defenses improved civil defense strengthened capacity prime importance powerful flexible nonnuclear forces threats massive retaliation may deter piecemeal aggression line destroyers quarantine division men border may useful real security multiplication awesome weapons beyond rational need commitment national safety commitment expand military establishment indefinitely dismiss disarmament merely idle dream believe end way assure security without impairing interests mistake honorable negotiation appeasement shall never weary defense freedom neither shall ever abandon pursuit peace quest united nations requires full continued support value serving peace shown anew role west new guinea settlement use forum cuban crisis task unification congo today united nations primarily protector small weak safety valve strong tomorrow form framework world law world nation dictates destiny another vast resources devoted destructive means serve constructive ends short let adversaries choose choose peaceful competition shall come realize ambitions succeed see wars liberation subversion ultimately fail recognize security accepting inspection permitting new nations master black arts nuclear war willing turn energies great unfinished tasks peoples surely areas agreement wide indeed clear understanding berlin stability southeast asia end nuclear testing new checks surprise accidental attack ultimately general complete disarmament ix seek worldwide victory one nation system worldwide victory man modern globe small weapons destructive disorders contagious permit kind victory achieve end united states continue spend greater portion national production people free world 15 years free nation demanded much hot wars cold recession prosperity ages atom outer space american people never faltered faith never flagged times actions seem make life difficult others history made life difficult us difficult days need dark think proud memorable days peace freedom proud example major rudolf anderson gave life island cuba salute specialist james allen johnson died border south korea pay honor sergeant gerald pendell killed among many century far home died country task task americans live commitment friends close note hope lulled momentary calm sea somewhat clearer skies know turbulence lies storms beyond horizon year winds change appear blowing strongly ever world communism well 175 years sailed winds back tides human freedom favor steer ship hope thomas jefferson said leaving fear astern today still welcome winds change every reason believe tide running strong thanks almighty god seeing us perilous passage ask help anew guiding good ship union
deliver person joint session vice president speaker member 88th congress congratulate merely electoral victory select role history privilege serve great republic could decisive decade long history choice make good ill may well shape state union generation yet come little 100 week ago assume office president unite state seek help congress countryman pledge easy answer pledge ask toil dedication congress people give good measure today witness recent month heighten respect national purpose power see courageous calm united people perilous hour observe steady improvement opportunity citizens report state old youthful union 175th year life good world beyond border steady progress make building world order people west berlin remain free secure settlement though still precarious reach laos spearpoint aggression blunt end agony may sight congo doctrine troika dead danger continue deadly threat remove cuba home recession behind u well million men woman work today work 2 year ago average factory workweek 40 hour industry turn good ever half manufacture capacity lay silent waste 100 week ago hum activity short home abroad may temptation relax road long burden heavy pace consistently urgent satisfied rest side hill top mere absence war peace mere absence recession growth make begin begin time come make gain translate renewal national strength achievement national purpose ii america enjoy 22 month uninterrupted economic recovery recovery enough prevail long run must expand strength economy must move along path high rate growth full employment would mean ten billion dollar year production profit wag public revenue would mean end persistent slack keep unemployment 5 percent 61 past 62 month end grow pressure restrictive measure week alone could increase hourly labor cost much 14 percent start new spiral inflation undercut effort compete nation achieve great gain one step essential enactment year substantial reduction revision federal income tax increasingly clear government business labor responsible economy success obsolete tax system exert heavy drag private purchasing power profit employment design check inflation earlier year check growth instead discourage extra effort risk distorts use resource invite recurrent recession depress federal revenue cause chronic budget deficit inflationary pressure war year longer threaten dollar command new respect military crisis strain resource time act afford timid slow urgent task confront congress 1963 early message shall propose permanent reduction tax rate low liability billion 11 billion result reduce individual tax rate range 20 91 percent sensible range 14 65 percent split present first bracket two billion dollar result reduce corporate tax rate 52 percent give government today majority interest profit permanent level 47 percent addition 2 billion cut corporate tax liabilities result last year investment credit depreciation reform achieve reduction within limit manageable budgetary deficit urge first cut phase 3 calendar year begin 1963 cut 6 billion annual rate second reduction couple select structural change begin 1964 broaden tax base end unfair unnecessary preference remove lighten certain hardship net offset billion revenue loss third budgetary receipt outset increase billion year without change tax liability gradually shift tax payment large corporation current time schedule combine program increase amount national income time result still high federal revenue fiscally responsible program sure sound way achieve time balance budget balance full employment economy net reduction tax liabilities 10 billion increase purchase power american family business enterprise every tax bracket great increase go consumer addition encourage initiative free system depend induce investment production capacity use help provide 2 million new job need every year reinforce american principle additional reward additional effort say measure tax reduction reform way achieve goal doubt massive increase federal spending could also create job growth today set private consumer employer investor give full opportunity first doubt temporary tax cut could provide spur economy long run problem compels solution doubt reduction either individual corporation tax alone would great help corporation need customer job seeker need job doubt tax reduction without reform would sound simpler attractive many growth also hamper host tax inequity special preference distort flow investment finally doubt would prefer put tax cut hope ultimately end cold war would make possible equivalent cut expenditure end view wait would costly submit tax program course temporarily increase deficit ultimately end recognition need control expenditures shortly submit fiscal 1964 administrative budget allow need rise defense space fix interest charge hold total expenditure purpose year level require reduction postponement many desirable program absorption large part last year federal pay raise personnel economy termination certain installation project substitution several program private public credit convince enactment year tax reduction tax reform overshadow domestic problem congress long lead peace freedom ever cease set pace home iii tax reduction alone however enough strengthen society provide opportunity four million american bear every year improve live 32 million american live outskirt poverty quality american life must keep pace quantity american good country afford materially rich spiritually poor therefore hold budgetary cost exist program keep within limitation set possible imperative adopt new measure afford postpone measure base series fundamental premise group four related heading first need strengthen nation invest youth future country dependent upon wisdom citizen damage irreparably damage whenever child educate full extent talent grade school graduate school today estimate 4 every 10 student 5th grade even finish high school waste afford addition reason one million young american school work remain unwanted often untrained city street energies put good use finally overseas success peace corp volunteer young men woman carry skill ideas needy people suggest merit similar corp serve community need mental hospital indian reservation center age young delinquent school illiterate handicap idealism youth serve world peace serve domestic tranquility second need strengthen nation safeguard health work men woman instead force beg help public charity old ill start contribute retirement health program social security system moreover miracles medical research count little reverse grow nationwide shortage doctor dentists nurse widespread shortage nurse home modern urban hospital facility merely keep present ratio doctor dentists decline must next 10 year increase capacity medical school 50 percent dental school 100 percent finally deep concern believe abandonment mentally ill mentally retarded grim mercy custodial institution often inflict family needless cruelty nation endure incidence mental retardation country three time high sweden example figure must reduce third need strengthen nation protect basic right citizen right competent counsel must assure every man accuse crime federal court regardless mean precious powerful right world right vote free american election must deny citizen ground race color wish qualify american permitted vote willing vote surely centennial year emancipation willing vote always permit fourth need strengthen nation make best economical use resource facility economic health depend healthy transportation artery believe way modern economical choice national transportation service increase competition decrease regulation local mass transit fare even bad essential community service hospital highways nearly citizen live urban area occupy 2 percent land local transit survive relieve congestion city need federal stimulation assistance next government storage stockpile business melancholy tune 16 billion must continue support farm income pile farm surplus top billion already must maintain stockpile strategic material billion acquire reason good bad much need empower dispose excess way market disruption finally already overcrowd national park recreation area twice many visitor 10 year today plan today future growth great natural asset park forest wildlife wilderness preserve water project kinds child child poorer every sense word domestic concern alone upon achievement great vitality strength home hang fate future world ability sustain supply security free men nation ability command respect leadership ability expand trade without threat balance payment ability adjust change demand cold war competition challenge shall judge home preach abroad nothing could help develop country would help half much boom economy nothing opponent could encourage ambition would encourage half much chronic lag economy domestic task divert energy security provide foundation freedom survival success iv turn world outside year ago southeast asia africa eastern europe latin america even outer space communism seek convey image unify confident expand empire closing sluggish america free world disarray people would hold picture today past month reaffirm scientific military superiority freedom double effort space assure u first future undertake defense improvement peacetime history country maintain frontier freedom west berlin complacency imperil security much weapon tyranny moment pause promise peace dangerous problem remain cuba south china sea world prognosis prescribes short year vacation u year obligation opportunity four special avenue opportunity stand atlantic alliance develop nation new difficulty search worldwide peace first fare grand alliance free europe enter new phase long brilliant history era colonial expansion pass era national rivalry fade new era interdependence unity take shape defy old prophecy marx consent conqueror could ever compel free nation europe move toward unity purpose power policy every sphere activity 17 year movement consistent support political economic far resent new europe regard welcome partner rival road world peace freedom still long burden full partner share support common defense expand world trade align balance payment aid emergent nation concert political economic policy welcome common effort industrialize nation notably japan whose remarkable economic political development 1950 permit play world scene major constructive role doubt difference opinion continue get attention agreement action europe move independence formal interdependence honest difference among honorable associate real frequent fact among western european ally unite state unity freedom never rely uniformity opinion basic agreement alliance fundamental issue continue first task alliance remain common defense last month prime minister macmillan lay plan new stage long cooperative effort one aim assist wider task frame common nuclear defense whole alliance nassau agreement recognize security west indivisible must defense also recognize alliance proud sovereign nation work best forget recognize nuclear defense west matter present nuclear power alone france power future way must find without increase hazard nuclear diffusion increase role partner plan man direct truly multilateral nuclear force within increasingly intimate nato alliance finally nassau agreement recognize nuclear defense enough agree nato level conventional strength must meet alliance afford position answer every threat nuclear weapon nothing remain near nassau decision far full realization know place history believe first time door open nuclear defense alliance become source confidence instead contention next press concern alliance common economic goal trade growth nation continue concern deficit despite decline remain stubborn troublesome problem believe moreover close economic tie among free nation essential prosperity peace neither member european common market affluent long afford shelter high cost farm factory wind foreign competition restrict channel trade nation free world common market move toward protectionism restrictionism would undermine basic principle government mean use authority confer last year congress encourage trade expansion side atlantic around world vi second develop nonaligned nation shock soviet sudden secret attempt transform cuba nuclear striking base communist china arrogant invasion india reassure prompt assistance india support unite nation congo unification patient search disarmament improvement treatment citizens visitor whose skin happen white old colonialism recedes neocolonialism communist power stand starkly ever realize clearly issue world struggle communism versus capitalism coercion versus free choice begin realize longing independence world whether independence west berlin begin realize independence run athwart communist ambition keep approach diverse need resilient resourceful communist still rely ancient doctrine dogmas nevertheless hard nation focus external subversive threat independence energy drain daily combat force poverty despair make little sense u assail speech resolution horror communism spend 50 billion year prevent military advance begrudge spending largely american product less amount help nation strengthen independence cure social chaos communism always thrive proud think american proud mutual defense assistance program evolve bipartisan support three administration recognize problem contribute fact single one nearly fifty member gain independence since second world war succumb communist control proud program help arm feed clothe million people live front line freedom especially proud country put forward 60 vast cooperative effort achieve economic growth social progress throughout americas alliance progress underestimate difficulty face mutual effort among close neighbor free state hemisphere work close collaboration begin make alliance living reality today feed one every four school age child latin america extra food ration farm surplus distribute million school book build classroom help resettle tens thousand farm family land call stimulate good neighbor fiscal social institutional land reform bring new housing hope new health dignity million forget men woman hemisphere know alliance succeed another name united state handout succeed latin american nation devote best effort fulfil goal story africa middle east asia wherever nation willing help stand ready help build new bulwark freedom purchase vote cold war go aid imperil nation neutral ally alike ask ask help use best advantage effort divert needless quarrel independent nation despite past achievement continue progress mutual assistance program require persistent discontent present performance reorganize program make effective efficient instrument process continue year free world development still uphill struggle government aid supplement role private investment trade expansion commodity stabilization internal process growth gradual bearing fruit decade day successes neither quick dramatic program ever end failure dozen country would sudden certain neither money technical assistance however weapon poverty end crucial effort one purpose require fuel finance also torch idealism nothing carry spirit american idealism effectively far corner earth american peace corp year ago less 900 peace corp volunteer job year number men woman age 18 79 willing give 2 year live help people land fact nearly million american serve country freedom overseas post record people match surely u stay home glad help indirectly support aid program open door foreign visitor diplomats student prove day day deed well word generous people vii third comfort take increase strain tension within communist bloc hope must temper caution disagreement mean end dispute best bury free world ground western rejoice nevertheless strain fracture clear force diversity work inside communist camp despite iron discipline regimentation iron dogmatism ideology marx proven wrong close communist society free open society carry within seed internal disintegration disarray communist empire heighten two formidable force one historical force nationalism yearn men free gross inefficiency economy close society open idea progress police state find command grain grow new nation ask choose two compete system need compare condition east west germany eastern western europe north south need compare disillusionment communist cuba promise alliance progress world know successful system build wall keep people freedom wall shame divide berlin symbol communist failure viii finally move present pause toward endure peace would counsel caution foresee spectacular reversal communist method goal trend development persuade soviet union walk path peace let know free nation journey choice make world develop reliable system international security free people choice keep arm nearby country therefore continue require best defense world defense suit sixty mean unfortunately rise defense budget substitute adequate defense bargain basement way achieve mean expenditure 15 billion year nuclear weapon system alone sum equal combine defense budget european ally also mean improved air missile defenses improve civil defense strengthen capacity prime importance powerful flexible nonnuclear force threat massive retaliation may deter piecemeal aggression line destroyer quarantine division men border may useful real security multiplication awesome weapon beyond rational need commitment national safety commitment expand military establishment indefinitely dismiss disarmament merely idle dream believe end way assure security without impair interest mistake honorable negotiation appeasement shall never weary defense freedom neither shall ever abandon pursuit peace quest united nation require full continue support value serve peace show anew role west new guinea settlement use forum cuban crisis task unification congo today united nation primarily protector small weak safety valve strong tomorrow form framework world law world nation dictate destiny another vast resource devote destructive mean serve constructive end short let adversary choose choose peaceful competition shall come realize ambition succeed see war liberation subversion ultimately fail recognize security accept inspection permit new nation master black art nuclear war willing turn energies great unfinished task people surely area agreement wide indeed clear understand berlin stability southeast asia end nuclear test new check surprise accidental attack ultimately general complete disarmament ix seek worldwide victory one nation system worldwide victory man modern globe small weapon destructive disorder contagious permit kind victory achieve end united state continue spend great portion national production people free world 15 year free nation demand much hot war cold recession prosperity age atom out space american people never falter faith never flag time action seem make life difficult others history make life difficult u difficult day need dark think proud memorable day peace freedom proud example major rudolf anderson give life island cuba salute specialist james allen johnson die border south korea pay honor sergeant gerald pendell kill among many century far home die country task task american live commitment friend close note hope lull momentary calm sea somewhat clear sky know turbulence lie storm beyond horizon year wind change appear blow strongly ever world communism well 175 year sail wind back tide human freedom favor steer ship hope thomas jefferson say leave fear astern today still welcome wind change every reason believe tide run strong thanks almighty god see u perilous passage ask help anew guide good ship union