My State of the Union Address was devoted to what I believe are the highest priorities facing our Nation in 1979 as we seek to build a new foundation at home and abroad. However, my Administration's time and effort this year will also be focused on a significant number of other important initiatives and goals. I am sending this State of the Union Message so that the Members of the 96th Congress are presented with a full picture of my basic legislative program in domestic and foreign affairs for the year. Over the past two years, my Administration has developed a very cooperative relationship with the Congress. That relationship not only resulted in the extraordinarily productive record of the 95th Congress, but will provide the foundation for a renewed sense of trust and confidence by the American people in their government. We have an enviable record to match. But with your help, the 96th Congress can meet this challenge. My Administration and I are eager to help in the effort. Our basic goals will be to continue working with you to build solid foundations for the next century—a solid economic foundation of stable prices and continued growth—a solid foundation for a more efficient, less intrusive Federal government—a solid foundation for world peace and American security. FOUNDATION FOR PROGRESS 
When I took office two years ago, the country faced serious domestic problems: • the economy had not recovered from a recession; • unemployment was intolerably high at 7.8%, with 7 3/4 million Americans out of work; • the Nation had no sound energy policy and oil imports were rising rapidly; • the Federal government was operating inefficiently in numerous vital areas; • trust in the openness and integrity of the government was low; • major social problems were being ignored or inadequately addressed by the Federal government. In the ensuing two years, we have tackled these problems head-on. While problems cannot be solved overnight, real progress has been made: • the economy has strengthened—real Gross National Product has increased 10% and real disposable personal income has increased 8.9%; • the unemployment rate has decreased by 25% since my election, from nearly 8% to 5.9%; 7.3 million new jobs have been created; total employment has reached a record of 95.9 million; • a comprehensive national energy, policy has been enacted and a Department of Energy created to help implement it; • the first major reform of Civil Service System in nearly a century was enacted; 6 reorganization plans have been approved and implemented; the Federal paperwork burden has been reduced by 10%; inspectors general are being placed in departments and agencies to help root out fraud and abuse; zero-based budgeting practices have been instituted throughout the government; several hundred million dollars have been saved through sound cash management reforms; regulations are being written in simple English, and a Regulatory Council has been established to develop the Nation's first regulatory calendar and agenda; • a renewed sense of confidence and faith in the government is gradually being restored; • long-ignored domestic problems have been attacked aggressively: the Nation's first urban policy was developed and its implementation begun; the Social Security System was refinanced to assure its long run solvency; the Humphrey-Hawkins Full Employment Act was passed; aid to education has been expanded by 50%; and a welfare reform program was developed and debated in Congress and will serve as a foundation for our efforts this year to overhaul the welfare system; • cumbersome regulatory apparatus which deters competition in our economy was dismantled by the deregulation of the airline industry. DOMESTIC POLICY PRIORITIES Over the next year, our domestic program will concentrate on further developing a new foundation for progress in each of several areas: • restraining inflation, while continuing to pursue our employment and other economic and budgetary goals; • making government more efficient and effective; • enhancing basic human and social needs; • protecting and enhancing our rights and liberties; and • preserving and developing our natural resources. INFLATION My Administration's major domestic priority is to reduce the rate of inflation, while maintaining economic growth. That is clearly the major domestic concern of the American people, and it is the problem they are looking to us to help solve. Inflation places a cruel burden on the poor and on those on fixed incomes. It serves as a disincentive to investment. It threatens our continued economic growth and job creation. This is more than an economic challenge. Inflation is the persistent, historic enemy of a free society. It saps our confidence and faith in the future. It undermines our trust. I am determined to meet the challenge now before us. Last October I announced an anti-inflation program which can aid significantly in the effort to reduce inflation. It is a tough and responsible voluntary program. Throughout this year, we will be working to implement our anti-inflation program. Part of the program requires new legislation, and we intend to work closely with you in developing and enacting that legislation. The effort to reduce inflation will be one of the most difficult battles our government has undertaken in many years. But it is not a battle we can afford to lose. Government cannot solve the problem of inflation alone. But we can and must lead the way. With your cooperation, we can and will win. The 1980 Budget In announcing my anti-inflation program last year, I made a commitment to the American people to reduce the budget deficit for fiscal year 1980 to $30 billion or less. The budget I submitted to the Congress honors that commitment. The FY '80 budget projects a deficit of $29 billion, which is less than half the deficit the Nation had when I ran for office and represents the smallest budget deficit in the last six fiscal years. The FY '80 budget has $531.6 billion in projected budget outlays, which is an increase of only 7.7% above the previous year. That is the smallest annual increase in Federal spending in the last seven years. The $531.6 billion spending total also means that we will be meeting my goal of reducing Federal spending to about 21% of Gross National Product one year ahead of schedule. The decisions I had to make in restraining spending were difficult. But if we are to succeed in breaking the back of inflation, Federal spending must be restrained to set an example for the private sector. If there were easier solutions, they would have been taken by now. Finally, I want to emphasize that my FY '80 budget does not neglect the basic needs of the disadvantaged, the poor, and the unemployed. For instance, the budget will provide $4.5 billion in increased assistance to the poor. It also will provide a total of $11.2 billion for adult and youth employment and training programs, which will be especially targeted to the disadvantaged and long-term unemployed. Moreover there are significant increases for education programs for the disadvantaged and a new fiscal assistance program for our Nation's cities. In short, this budget is austere, but it also maintains our commitment to help those in our country who most need it. Hospital Cost Containment One of my highest legislative priorities for this year is hospital cost containment. It will be one of the clearest tests of the seriousness of the Congress in dealing with the problem of inflation. Clearly the most inflationary part of health care costs in recent years has been in the hospital industry. Last year, hospital charges grew at the rate of about 13 percent. Experience in several States has shown that through programs such as the one I will propose, hospitals can save money and reduce costs through sound cost containment practices. I expect to shortly propose hospital cost containment legislation which will build on the proposal passed last year by the Senate. Real Wage Insurance I have proposed to the Congress a real wage insurance program to protect employee groups that comply with the 7% voluntary wage standard against losses in purchasing power if inflation exceeds 7%. If inflation exceeds 7%, these employees will receive a tax refund equal to their 1979 income up to $20,000 times the difference between the actual inflation rate (up to 10%) and 7%. This program will give workers a strong economic incentive to cooperate with the voluntary pay standards I have established, thereby helping to break the wage/price spiral that is at the root of the current persistent inflation. This is a novel approach to the inflation problem. The persistence of high inflation for the past ten years makes clear that new solutions are needed. Innovative approaches must be added to the arsenal if we are to break the back of inflation. Real wage insurance represents the type of innovative approach which is required: it will provide a significant tax benefit for those working people who participate in helping to reduce the inflationary cycle, but without raising taxes for anyone else. My administration intends to work very closely with Congress in developing and enacting a real wage insurance law. Voluntary Pay and Price Standards It is vital that our program of voluntary pay-price standards succeed. At stake is the reduced rate of inflation that all Americans demand and deserve. The cooperation of business and labor is obviously essential, and we have already had clear evidence of their willingness to join in this effort. I have already received assurance from over 200 of the Nation's largest corporations that they will comply with the standards. And just recently the Oil, Chemical, and Atomic Workers Union reached agreement on a contract with the major refineries that met the pay standards. Throughout this year the pay and price standards will continually be tested. Your cooperation in encouraging voluntary compliance can help ensure the standards' success. The Administration will keep the Congress fully informed and involved as we work to implement this program. State and Local Governments If we are to succeed in our anti-inflation efforts, the cooperation and active participation of State and local governments is essential. We will soon announce a program which actively involves the Governors, Mayors, County Executives, and other local officials in a comprehensive approach to restrain inflationary pressures within their control. The Necessities In recent years, the greatest inflationary burden on the working men and women has involved necessities of life food, energy, housing, and medical care. An effective anti-inflation program must involve a series of concerted attacks on the sources of rising prices in these vital sectors. In each of these areas, the Administration has established task forces to identify existing government policies that unreasonably inflate prices, and to suggest actions that can be taken, at both national and local levels, to combat inflation. In these efforts we will work directly with Congress, State and local governments, and consumer groups. Multilateral Trade Negotiations ( MTN) I have already notified the Congress that we expect to sign and submit for Congressional approval a set of trade agreements which we will reach in the Tokyo Round of the Multilateral Trade Negotiations. With these agreements, we expect to achieve major reductions in tariff and nontariff barriers to international trade. These agreements will: —lead to increased opportunities for U.S. exports; —ensure that import competition is fair; and —result in lower prices, increased competition, and greater prosperity for the American people. Passage of the MTN will be one of my highest legislative priorities this year. It is critical to the health of our domestic and of the world economy. Countervailing Duties I have recently sent to the Congress a message urging prompt passage of legislation permitting the waiver of the imposition of countervailing duties on certain imported products. Passage is essential to the successful completion of the Multilateral Trade Negotiations, and therefore, should be one of Congress' highest priorities at the beginning of this session. Exports The United States has entered a period where export growth is essential to improve our balance of payments, strengthen the dollar, and thereby help reduce inflationary pressures. To do this, both the private sector and the Federal government must place a higher priority on exports. With the National Export Policy I announced last year, we are moving to meet this need. First, we are working to reduce domestic barriers to exports so that exporters are not stifled by excessive governmental regulation. Second, we are providing further incentives in the form of better export financing and better government export development programs. Third, we are working with our trading partners in the Multilateral Trade Negotiations to reduce foreign barriers to our exports and to secure a fairer international trading system for all exporters. These actions should expand our exports in 1979 and help us move toward a reduced trade deficit, although they will not cure our serious balance of trade difficulties overnight. They are the first steps in an essential, long-term effort to strengthen the U.S. position in world trade, while reaffirming the Nation's commitment to maintain an open world trading system and to resist protectionism. Council on Wage and Price Stability The Council on Wage and Price Stability is playing a vital role in our anti-inflation efforts. The Council and its staff have the lead responsibility within the Executive Branch for implementing the voluntary wage and price standards that I have announced. Without the Council's continuing role, the anti-inflation effort would have a very slim chance of succeeding. I therefore believe it is essential that the Council, along with its staff operation, be reauthorized early this year with the additional staff I will request to handle the enormous volume of work under my anti-inflation program. The reauthorization should not contain amendments that interrupt or restrain the necessary work of the Council or its staff. EMPLOYMENT The Administration, working closely with Congress, has made significant progress over the last two years in reducing unemployment and creating new jobs: • The December unemployment rate of 5.9% represents almost a 25% reduction from the December, 1976 rate. • 7.3 million more people have jobs than they did before the beginning of the Administration. This increase exceeds the employment growth in any other two-year period since World War II. • Total employment has reached an all-time high of 95.9 million. • Over the past two years black employment is up by 12%; and black teenage employment is up by 19.7%; adult female employment has increased by 10.5%; teenage employment overall has increased by 11%. Although progress has been made, unemployment remains unacceptably high for these groups. And in inner-city areas unemployment remains much too high for all workers. Last year, which ended with the lowest unemployment rate in 3 years, a framework for continued progress into the next decade was established: • the Comprehensive Employment and Training Act (CETA) was reauthorized at high levels for four more years; • the Humphrey-Hawkins Full Employment Act became law after many years of effort; • the Administration's demonstration youth programs were extended for two more years; • a new partnership between the government and the private sector to assist the unemployed was approved by Congress with the passage of a new Title 7 of CETA—the Private Sector Initiatives Program; the targeted jobs tax credit, to encourage private employees to hire our poor young people and others who are hard to employ; and an expanded tax credit for mothers on welfare. In 1979 this framework will help us continue to improve the employment prospects for America's workers. We especially want to improve the targeting of job creation programs to those who most need these opportunities and to improve the quality of the training and employment assistance for the poor, blacks, Hispanics, youth and women. We expect to achieve these goals through a number of actions: First, we will continue working toward achievement of the Humphrey-Hawkins Full Employment Act goals. We will provide an average of 546,000 CETA public jobs, and shift many of them to the longterm or "structurally" unemployed. We will continue to search for the most promising ways to reduce the structural unemployment that denies many the opportunity for full participation in American life. Second, we will begin implementing the new Private Sector programs, including establishment of Private Industry Councils in communities throughout the country, to encourage business to hire the hard-core unemployed. I am proposing to Congress that this effort be supported at a level of $400 million this year. Third, we will continue our special efforts to provide jobs and training programs for young workers in cooperation with community-based organizations and the private sector. We must meet our responsibility to provide opportunities for young Americans to learn to work. Fourth, we will take steps to improve the management and delivery of employment and training services. I will seek a reform of the Wagner-Peyser Act, which authorizes the U.S. Employment Service, to integrate that program more effectively into our employment and training system. My Administration will also implement the CETA amendments, which establish practices and procedures to improve the quality of programs, provide better management and prevent fraud and abuse. MAKING GOVERNMENT MORE EFFICIENT AND EFFECTIVE The American people are demanding a Federal government which is effective and efficient. For the past two years, I have worked toward that goal by reorganizing and reforming the government's operation and by uncovering and removing fraud, waste and abuse. Real progress has been made. But the government is still not operating as competently as I want or the American people deserve. In 1979, we must build on the base of the last two years to provide our people with the type of government they deserve. Your help in this effort is essential. We have already begun to build a new foundation of government efficiency and we will do more in the year ahead. Reorganization We have begun to reorganize the government through the creation of a Cabinet-level Department of Energy and the changes resulting from the six reorganization plans approved by Congress over the past two years. Those plans helped to reshape and improve the operation of the Executive Office of the President, the international cultural and communications agencies, emergency preparedness agencies, the equal employment opportunity enforcement agencies, the Civil Service Commission, and the administration of the Employee Retirement Income Security Act. I will again propose to the Congress that a Cabinet-level Department of Education be created. This will be a very high priority of this Administration. Education issues deserve far more attention and more accountable management than they can receive in a department as large and complex as HEW. The department would provide a Cabinet-level official devoting full-time attention to education and reporting directly to me. It will also enable the Federal government to be a more responsive and reliable partner with States, localities, and private institutions which have primary responsibility for education. I will also be proposing to Congress reorganization plans involving economic development and the management of our natural resources development, and will intensively study possible reorganizations in the areas of surface transportation, the Selective Service system and the Alaska natural gas pipeline. The natural resources and economic development reorganizations involve areas where overlap, duplication and unclear authority have hamstrung our efforts. Reorganization here can save money and people. We will be consulting closely with Congress over the next several weeks before submitting these reorganization plans. Regulatory Reform Last year we took major steps toward reform of the Federal regulatory system, ranging from improved regulation writing to saving hundreds of millions of dollars through improved cash management techniques. The dramatic reductions in airline prices that occurred when Congress joined with us to lift the heavy hand of Federal regulation illustrate the advantages of letting the competitive market, rather than government, control industry performance. The public will benefit similarly through improved service, increased competition, and lower Federal expenditures, if we reform Federal regulation of surface transportation. I will send to Congress shortly a Surface Transportation Reform Message dealing with the rail, inter-city bus, and trucking industries. In 1978 I used my authority as Chief Executive to improve the management of the Federal regulatory process. I issued Executive Order 12044, setting standards to ensure that each Executive Branch regulatory agency facilitates public, participation and avoids needless costs. A regulatory analysis program was established under an inter-agency Regulatory Analysis Review Group to help ensure that major new regulations are as cost-effective as possible. The Executive Order also established procedures for all Executive Branch agencies to conduct sunset reviews to reevaluate outdated regulations and remove them from the books wherever warranted. Finally, I created a Regulatory Council composed of the Executive Branch regulatory agencies, with voluntary participation by independent agencies, to develop a calendar of all major Federal regulations to be issued or proposed in 1979. The Nation's first Regulatory Calendar will be published next month and will be used to eliminate duplication, overlap, and inconsistent practices. This year I will propose to Congress a number of legislative actions that can be taken to improve the regulatory process. They will include improvements in specific regulatory programs, as well as a Regulatory Reform Act so that no regulation can be issued unless it is genuinely required, and unless it gets the job done with maximum efficiency and minimum paperwork, costs, and other burdens. The quality of regulations can also be improved by providing opportunities for all interested parties to participate in regulatory proceedings. Public involvement should be enhanced by providing financial assistance to those whose participation is limited by their economic circumstances. While many agencies have inherent authority to fund participation, we will seek legislation to specifically authorize these programs. While I will propose a wide-ranging legislative program, I will continue to oppose the legislative veto. This approach is unconstitutional; it increases uncertainty and delay; and it deflects attention from the real solutions. None of our actions in this area will be taken at the expense of my deep personal commitment to protect health and safety in the environment, the workplace, the highway, and consumer products; and to prevent deception and unfairness to consumers. My regulatory reform program will help make needed programs work better, cost less, and gain support among all sectors of our society. Civil Service and Pay Reform Enactment of the Civil Service Reform Act of 1978 by the 95th Congress represented one of the finest examples of cooperation between the Legislative and Executive Branches in recent times. That effort showed a determination to respond to the clear public desire to improve the management of the Federal bureaucracy. Implementation of the Reform Act is well under way. The Office of Personnel Management, the Merit System Protection Board, and the Federal Labor Relations Authority authorized by the Act have been established. In addition, the heads of the Federal departments and agencies have moved promptly to implement the new personnel procedures that will permit a better motivated and more effective civil service. However, other improvements in management of the government's work force are needed. Our white collar, blue collar, and military systems must be reformed in order to make certain that we neither overpay nor underpay Federal employees. Therefore, I will propose Federal pay reform legislation covering each of these systems to the Congress that is equitable to Federal employees and the public. These pay reforms are an important follow-on to our civil service reform. Public Financing The time is long overdue for reforming the way Congressional elections are financed. The current flood of money threatens to pervert our electoral process. We can no longer permit our elections to be open to the highest bidder. The recent elections have clearly demonstrated the kinds of problems caused by uncontrolled campaign spending. It is time to adopt public financing for Congressional elections-before it is too late. Public financing operated successfully in the last Presidential election, and it can do the same in Congressional races. My Administration will work with Congress for passage of a sound Congressional public financing law. Sunset My Administration will again work with the Congress to enact a sound sunset bill. Under such a bill, each Federal program would have to be carefully re-examined on a periodic basis to determine whether its continued existence is justified. Through such a procedure, the American people can be assured that unnecessary government programs and agencies will be ended, rather than continued through the force of inertia; and other programs and agencies will be improved. There are few more important building-stones to the new foundation of government efficiency we seek than passage of sunset legislation. It goes to the heart of making government work. Lobby Reform The American people have a right to know what significant influences affect their national legislature. The proliferation of well financed, organizational lobbying activities during recent years has demonstrated the clear need for reform of the outdated and ineffective lobby disclosure law now in effect. This year my Administration will continue to work with Congress to pass a sound lobby law reform bill—one that respects the First Amendment right of all Americans and minimizes paperwork burdens, yet allows meaningful disclosures. Waste, Fraud, and Inefficiency Although the vast majority of Federal employees are able, honest and hardworking, we need to continue to be vigilant to ensure that the taxpayers' dollars are not wasted through fraud or abuse. The implementation of civil service reform will lead to improvements in agency management practices and program efficiency. In addition, I am committed to continuing to cut excess paperwork, simplify grants requirements, and evaluate our programs better and more frequently. We have already significantly reduced the paperwork burden and implemented many of the recommendations of the Federal Paperwork Commission. We will continue to do more in 1979. Early this year I will nominate highly qualified Inspectors General armed with tough new powers to prevent waste and corruption. The Justice Department will increase its already intensive effort to prosecute those few employees and contractors who abuse the public trust. In addition, a new Office of Ethics in the Office of Personnel Management and a Special Counsel in the Merit System Protection Board will help ensure the integrity of the Federal work force and protect its members from political abuse. State and Local Government Relations As the first President in more than thirty years to be elected immediately after service as a Governor, I have made relations with State and local government a high priority of my Administration. During my first two years in office, we have strengthened the Federal system significantly. We have involved the Federal Regional Directors in the management of the government and have reinvigorated the Federal Regional Councils. As a result, the Federal government is now able to respond better and more quickly to State and local needs. In addition, we have involved State and local officials in the development of our policies to a greater degree than any previous Administration. Since 1977, Federal grants-in-aid to State and local governments have increased to more than $80 billion per year, 25 percent above the level of aid when I first took office. Progress has also been made towards my goal of giving Governors, Mayors, and county officials more flexibility in managing Federal programs. The Federal government is now taking seriously, for the first time, the burdens and costs we impose on State and local governments and all taxpayers when we legislate and regulate from the Federal level. In this time of limited budget resources we must achieve more cost-effective management of Federal resources and place greater reliance on the experience, knowledge, and ability of State and local governments. In the future, we must attempt to limit the imposition of new costs on State and local governments, and to avoid where possible prescribing every detail of how they administer Federal programs. We must work together to identify specific ways in which more flexibility can be given to State, city, and county officials in the administration of Federal programs without compromising the national purposes that each program is designed to serve. Transportation In 1979 we shall continue the effort begun in the 95th Congress to reduce the regulatory burden on the Nation's transportation industry. Our proposals for surface transportation deregulation will build upon the principles of increased competition that have proven successful for the airline industry. Shortly, I will propose broad legislation which begins to deregulate the railroad industry. Regulatory reform is a crucial first step toward revitalizing this important transportation mode. In addition, I will also be proposing significant reductions in the regulation of inter-city bus transportation and certain regulatory changes in the trucking area. We are also committed to improving the level of safety for our transportation industry. As part of this effort, we intend vigorously to pursue legislation improving equipment and conditions affecting truck drivers, and giving stronger enforcement authority to Federal agencies. My forthcoming Surface Transportation Regulatory Reform Message will provide the details of these proposals. Finally, I will propose overdue changes in the Nation's maritime policies. We must improve the ability of our Merchant Marine to win a fair share of our cargo. No-Fault The Administration will continue to support legislation to establish Federal minimum standards for state no-fault automobile compensation systems. No-fault systems have proven to be far more efficient in delivering benefits to the victims of automobile accidents than the current tort system, and they also provide greater opportunities to coordinate and reduce overall insurance costs. Too great a percentage of the premiums paid by policy-holders goes for the administration of the current wasteful tort liability system. No-fault would save money and court-time. It deserves Congressional support. Consumer Representation My Administration has developed new procedures that will set standards and assess performance for effective public representation within government agencies. These procedures are designed not only to improve the delivery of government services to our citizens, but also to enhance the awareness of government to the health, safety, and economic concerns of all consumers. In 1979, we will direct adequate resources to these procedures, which include complaint handling, training and technical assistance for consumer organizations, advocacy, consumer education and information, and citizen participation. LEAA Last year I proposed legislation which would institute significant and long-overdue changes in the structure and programs of the Law Enforcement Assistance Administration. The LEAA has the potential to improve and strengthen State and local law criminal justice programs, but in its present form it has fallen far short of its potential. My Administration will work with the Congress again this year to reform this framework, which includes a National Institute of Justice to enable us to obtain better information and research about crime problems. Once the legislation is enacted, we will make certain that the new agency is efficiently carrying out its mission of providing meaningful Federal law enforcement assistance. Judgeships Last year my Administration worked closely with the Congress to enact legislation creating the additional Federal judgeships needed to reduce our court's backlogs and delays. As a result, I will soon be nominating 152 new Federal judges—the largest addition to the Federal judiciary in our history. Some of these judges will still be serving in the next century. I am determined to nominate judges of the highest quality; our Federal judiciary must be selected on the basis of merit. I am also determined to increase the low representation on the Federal bench of women, blacks, Hispanics, and other minorities. These goals are within our reach, if we work together cooperatively and recognize the importance our country places in the selection of these new judges. Judicial Reform Because our Federal courts do not function as well as we have the right to expect, my Administration has made judicial reform one of its goals. During 1978, Congress took major steps toward alleviating the problem by increasing substantially the number of Federal judges and by adopting numerous substantive and procedural reforms in the handling of bankruptcy matters. Other judicial reforms remain to be made. Some, such as expanding the authority of magistrates and curtailing diversity jurisdiction, were proposed to the last Congress. I will shortly send a message to the Congress urging prompt action on these and several additional proposals designed to improve the responsiveness and efficiency of our system of justice. They merit the attention and approval of the Congress. In addition, as was indicated in my Consumer Message to Congress, the Administration will continue to support reform of class action procedures. Reform legislation should seek to ease unnecessary burdens and costs of class actions, while at the same time preventing them from being used in a harassing manner. Antitrust Enforcement and Competition Free enterprise and competition, protected by the antitrust laws, are the central organizing principles of our economic system. Competition produces powerful incentives for innovation and efficiency, fights inflation, and enhances consumer welfare. Strict enforcement of our antitrust laws are critical to the health of competition and the Nation's economy. Several important strides were made last year in improving antitrust enforcement. In 1978, the courts imposed over $11 million in corporate fines for antitrust violations and imprisoned 29 individuals for antitrust violations. These fines and sentences are significantly larger than in past years, and are consistent with my strong commitment to vigorous antitrust enforcement. Last year I appointed the National Commission for the Review of Antitrust Laws and Procedures to suggest ways of expediting antitrust cases and making relief more effective. Its members have recently reported to me, and we will work closely with the Congress and the Judicial Conference to implement many of its recommendations. Similar progress in improving the effectiveness of antitrust enforcement can be made in the 96th Congress. I continue to support legislation to allow those who are injured by antitrust violations to recover damages from the antitrust violator, whether the injured person is a direct or indirect purchaser. Under the Supreme Court's decision in the Illinois Brick Case only direct purchasers may recover, even though they may have passed on the injury to consumers, who are prevented from suing. This decision undercuts state and private enforcement of the antitrust laws, reduces their deterrent effect, may contribute to higher prices, and often allows the violator to keep his gain at the expense of the injured consumer. This needed legislation would overturn that decision. Banking I anticipate receiving shortly the recommendations of the Administration's Task Force studying Regulation Q and the system of deposit interest rate controls, and I expect to make recommendations based upon the Task Force's findings. My Administration remains supportive of Congressional action to deal with the need to halt the continuing attrition in the percentage of bank deposits subject to the reserve requirements of the Federal Reserve System. Carryover Basis Carryover basis was one of the most important reforms passed by Congress in the Tax Reform Act of 1976. This reform would add substantial equity to our tax laws and greater efficiency to our capital markets. The carryover basis reform has the effect of ending a situation in which many of our wealthiest taxpayers could permanently escape paying income tax on their gains from inherited property. Unfortunately, the effective date has been delayed until the end of 1979. My Administration will strongly oppose any efforts to repeal this reform or further delay its implementation. ENHANCING BASIC HUMAN AND SOCIAL NEEDS In the years immediately preceding my Administration, too many of our Nation's basic human and social needs were being ignored or handled insensitively by the Federal government. Over the past two years, we have significantly increased funding for many of the vital programs in these areas; developed new programs where needs were unaddressed; targeted Federal support to those individuals and areas most in need of our assistance; and removed barriers that unnecessarily kept many disadvantaged citizens from obtaining aid for their most basic needs. The progress over the past two years has noticeably moved us forward toward building a new foundation to solve some of the country's fundamental human and social problems. My Administration has vastly expanded assistance in the last twenty-four months in areas of employment, education, housing, community and economic development and health care, which represent an improvement for the American people. The record of the past two years demonstrates that government can meet our citizens' basic human and social needs in a compassionate way. No longer can there be any doubt that the government is able to treat Americans' problems with sensitivity. In the coming fiscal year, budget restraints make it more difficult to expand funding significantly for many major domestic programs, though some programs will be increased. We will continue to make existing social programs work more effectively; to reduce the waste and fraud and excess bureaucracy which drains tax dollars intended to meet basic human needs. In a period of austerity, efficiency is itself an act of compassion because it unlocks resources needed for health care, education, housing, economic development and other urgent social priorities. Health Program One of the highest goals of the 96th Congress should be taking action to provide all Americans with the opportunity to lead a more healthy life. This opportunity has been denied to many in our country because of health care services which are unaffordable, inaccessible, and inefficient. In addition, our current system of health care is focused on the treatment of disease, with too little attention being directed toward its prevention. We need a national health strategy which corrects these inadequacies in the existing system. Some of the elements of this strategy are already in place and need only be strengthened. Others will require new legislation from the 96th Congress. National Health Plan and Other Improvements Last year I outlined the principles upon which the National Health Plan I intend to propose will be based. Based on those principles, the Administration has been working to develop a National Health Plan that will enable the country to reach the goal of comprehensive, universal health care coverage. I remain committed to that goal. The need for improved health care coverage is clear: • About 19 million Americans have no health insurance. • Another 65 million Americans face potential bankruptcy because they lack insurance protecting them against catastrophic medical expenses. • The health care system is highly inflationary. Spending in the entire health care industry—has been rising at an annual rate of 12%. These expenditures cannot be successfully contained under current health delivery and financing methods, which produce unnecessary hospitalization, over-reliance on expensive technology and inadequate preventive care. • Health resources are unevenly distributed across the country, resulting in significant gaps in vital medical services for many residents of rural and inner city areas. Over the next several weeks, we will be consulting closely with Congress and interested outside groups on the scope and nature of the plan I will propose. I expect to submit a plan later in the year shortly after those consultations have been completed, and I look forward to working with the Congress toward a prompt enactment of that plan. An essential companion to any plan must be hospital cost containment legislation. As I have indicated earlier in this Message, I will make passage of that legislation one of my highest priorities this year. Our effort to control health care costs would be further strengthened by the early passage of the Health Planning Act. We must also continue to promote competition in the health care sector of the economy. Accordingly, the FY '80 budget expands Federal support for Health Maintenance Organizations, which have demonstrated a significant potential for cost saving. I will also continue to press for reforms making it easier for HMO's to obtain equitable reimbursement under Medicare and Medicaid. Prevention and Accessible Health Services More health care services alone, however, will not necessarily improve the health status of our Nation—even if these services are affordable, accessible, and efficient. Our national health .strategy must direct more attention to health promotion and disease prevention if we are to achieve our goal of improved health status. The Surgeon General will present this year a major report outlining our needs in this area. I will be asking for your help in carrying out many of its recommendations. We have made great strides in expanding the availability of health care services to rural and low-income urban areas in recent years through the creation of the National Health Service Corps and the establishment of a system of Community Health Centers. If health care is to be accessible to all Americans, these programs must be expanded, and the FY '80 budget provides for such an expansion. Child Health Assessment I believe that our health strategy must place high priority on the health of our children. Accordingly, I will submit a revised Child Health Assessment Program to improve the early and preventive screening, diagnosis, and treatment program for lower-income children under Medicaid. This program would cover over 2,000:000 low-income children who are not receiving Medicaid services. An additional 100,000 low-income pregnant women would become eligible for medical services prior to delivery, improving the health of both the mothers and infants. This should be part of a national health plan. Mental Health Based upon last year's recommendations of the President's Commission on Mental Health, I will be proposing comprehensive mental health legislation this year along with a Mental Health Message. A new Community Mental Health System will make new efforts to link mental health, health, and social services for the chronically mentally ill to enable them to live successfully in the community and will provide new community mental health services. We will emphasize efforts to provide improved recognition and treatment of mental health problems in the general health care system. In addition, we will increase support for mental health research to restore our mental health research capacity, which the Commission found had seriously eroded over the past decade. The First Lady has helped spearhead the Administration's efforts to sensitize the Nation to the problems in the mental health area. She will continue to work directly with me to implement the pertinent recommendations of the Commission. Drug Abuse In continuing our efforts to combat drug abuse, my Administration will rely on those programs and initiatives which have proven to be successful in the past year and which serve as building blocks for future programs. Today, in the United States, there are 110,000 fewer heroin addicts than there were in 1975; 1,000 fewer Americans died of heroin overdoses in the twelve-month period ending June 30, 1978 than in the previous twelve months. Seizures of illegal drugs are at their highest level ever. Improved coordination and cooperation among Federal agencies have resulted in a more effective drug program without major budget increases. But much remains to be done and the situation remains serious. In 1979 we will look more to the behavior of the individual who turns to drugs, will stress financial investigations as a means of prosecuting those individuals responsible for the drug traffic, and will rely heavily on enlisting foreign cooperation in the overall drug program. These efforts should further our success in. controlling drug abuse both in the United States and abroad. Drug Regulation Reform My Administration will continue to work with the Congress to overhaul our current drug regulation laws in order to assure that consumers have prompt access to safe and effective drugs. Food and Nutrition Last year, we worked with the Congress to enact the Child Nutrition Amendments, which revamped many of our food programs and greatly expanded the Supplemental Food Program for Women, Infants and Children. This year I will propose further legislation to strengthen these and other food programs by: improving the targeting of school meal programs for the needy; instituting an error sanction scheme to encourage States to reduce costly Food Stamp errors; and eliminating the cap on food stamp expenditures. These reforms will insure that additional nutrition resources are targeted to those truly in need. Worker Health and Safety We will continue to fully enforce laws protecting worker health and safety in a sensible and efficient manner. There will be further efforts to eliminate frivolous and unneeded rules while concentrating greater enforcement efforts on the most dangerous and particularly the most unhealthy occupational environments. More efficient management of this program will serve the interest that both labor and management have in better working conditions. Housing We are committed to holding down housing construction costs and eliminating unnecessary regulatory burdens, so that the American consumer will have an affordable choice in the housing marketplace. Our efforts will be accelerated this year. We have also supported introduction of the new money market certificates, which have helped the housing industry by maintaining a steady supply of mortgage credit. The Administration has supported the provision of Federal housing assistance to low-and-moderate income people, including the elderly and the handicapped. During the period of 1978 through 1980, the Administration will have committed resources for over one million additional units of assisted housing for low-and-moderate income renters and homeowners. This is evidence of our commitment to the goal of a decent home for every American. In 1980, I am recommending 325,000 units of housing for low-and-moderate income persons. The problems of providing adequate housing in rural areas is especially acute. Lack of available land, high site development costs, widespread substandard, overcrowded housing, and limited credit opportunities continue to plague rural areas. Government attempts to help are often hampered by inappropriate, burdensome regulations and paperwork. This year the Administration will take steps to assure that Federal regulations accommodate locally acceptable housing codes and that the endless paperwork, inspections, and processing requirements currently mandated by the three major housing agencies, HUD, FHA, and VA, are consolidated and streamlined. Community Development My Administration remains committed to a partnership involving Federal, State, county, and local governments, the private sector, and community organizations. The Community Development Block Grant program is a cornerstone of that partnership, and I am proposing in my FY '80 budget that it be funded at the full authorization level. This will be an increase of $150 million in FY '80 above the FY '79 level. In 1977, we developed the Urban Development Action Grant program and it has already succeeded in leveraging $2.9 billion in private investment and creating or saving 125,000 jobs. I am proposing a continuation of the Action Grant program next year, at the $400 million authorization level. Neighborhoods My Administration has been devoted to the preservation of neighborhoods and the development of sound neighborhood self-help projects. This goal has been evident in the emphasis on neighborhoods in my urban policy as well as in the operation of the Department of Housing and Urban Development and other agencies. Last year, as part of our urban policy, we proposed and Congress passed the Livable Cities and Neighborhood Self-Help Development programs to enable neighborhood groups and organizations to rebuild their neighborhoods. In addition, Congressional passage of the National Consumer Cooperative Bank makes available new sources of financing and technical assistance to groups who are engaged in building cooperative enterprises to reduce costs in key consumer goods and services. This year, my Administration and Congress will receive the final report of the National Commission on Neighborhoods. We look forward to working with the Congress on many of the Commission's recommendations. With your help, we can make the Federal government increasingly more responsive to the needs of neighborhood people who are working together to meet basic needs in housing and community development, health care, nutrition, and energy conservation. Urban Policy Last year, I proposed the Nation's first comprehensive urban policy. That policy involved more than one hundred improvements in existing Federal programs, four new Executive Orders and nineteen pieces of urban-oriented legislation. With Congress' cooperation, thirteen of these bills passed last year. I will again propose to the Congress several important parts of the urban policy not adopted last year. The two principal proposals are: an urban fiscal assistance program, and the National Development Bank. My fiscal assistance proposal will include two principal components. The first, a standby countercyclical fiscal assistance program, will protect State and local governments against unexpected changes in the national economy. It would trigger into place if the national unemployment rate rises above 6.5 percent and would provide fiscal aid to many needy governments. The second component is a transitional, highly targeted fiscal assistance program that provides fiscal aid to only the most fiscally-distressed local governments. Relatively few cities and counties will be eligible for this highly targeted program; but those eligible will be truly in need. I will seek a $250 million supplemental in FY '79 and $150 million in FY '80 for this targeted fiscal assistance program. I also will propose a National Development Bank to provide financing for local economic development projects which will aid the revitalization of our Nation's communities. As part of the Bank, I will propose a significant increase in economic development funding—$550 million in new economic development capital grants to business and $2.65 billion in new loan guarantee authority for FY '80. This Bank will be the central engine for the economic development in the government. We will propose the consolidation of many economic development loan programs into the Bank as part of the economic development reorganization. This will add over $1 billion in additional loan authority. Social Security Changes In 1977 the Congress worked with the Administration to take the difficult but necessary action to make the Social Security system financially sound for the next fifty years. In so doing, we helped protect the benefits of current recipients and of those now working. However, the Social Security system from time to time needs adaptation to changing conditions, so the Administration this year will make proposals which will reduce somewhat the cost of the program by trimming the costs of certain benefits. These proposals will be sent to the Social Security Advisory Council, which is representative of the contributing employers, employees and the public, and to the National Commission on Social Security, appointed in part by the Congress and in part by me, so they can have an ample opportunity to review these proposals prior to the submission of the changes to the Congress and the Administration and the Congress can have their recommendations, if any. If the Administration's proposals for Social Security outlay reductions and hospital cost containment legislation are enacted, it would be possible to consider a reduction in Social Security taxes beginning in 1981. However, such a reduction would have to be considered in light of alternative uses of such savings, including reduction of any budget deficit and funding of high-priority programs. Beyond the immediate reforms I have proposed, the Administration is committed to review the entire pension system that has developed in our country. I have established a Pension Commission to provide the type of long-range analysis this vital area needs. Disability Insurance Reforms I will propose to Congress an integrated package of reforms for the Disability Insurance system, separate from the Social Security changes I have just discussed. These measures will improve incentives for rehabilitation of the disabled, ensure that benefits do not exceed pre-disability disposable income, and make administration of the system simpler and more consistent. We must make certain that those who should receive benefits are not excluded, but that those who are not truly disabled or can otherwise return to work, do so. Welfare Reform The Nation's welfare system is inequitable, inefficient and long overdue for serious reform. I will recommend to the Congress a package consisting of reforms in cash assistance, expansion of the earned income tax credit, an expansion of private and public job opportunities for welfare recipients, and fiscal relief for State and local governments. This package will enable us to develop a welfare system that is more simple, narrows the great differences in the way States help the very poor, that encourages people to work, and that helps eliminate the fraud and abuse currently plaguing parts of our welfare system. My Administration has already begun to work closely with this Congress to enact welfare reform this year. We must expeditiously move forward with welfare reform this year. Families Our major social initiatives and goals for this year will be undertaken with vigor and with a commitment to the security and enhancement of the American family structure. Our government must never impede nor work against the American family, but rather we must design programs and policies that support families and ensure that future generations of American families will thrive and prosper. The White House Conference on the Family will continue and expedite its planning this year with that goal firmly in mind. Child Welfare Reform The Nation's present system of overlapping, inadequate child placement programs does a great disservice to parents, foster parents, and children in need of homes. There is too little emphasis on reunification of families and permanent placement of children; the special problems of hard-to-place children often go unattended. I will therefore again propose to Congress major reforms in our foster care and adoption services, and urge prompt Congressional approval. This problem must not be left unattended any longer. 
Older Americans Early in the Administration we moved to correct one of the major concerns of older Americans: the possible bankruptcy of the Social Security Trust Funds. The legislation that was enacted ensures the financial solvency of the funds through the beginning of the next century. The Administration has also acted to help remove discrimination against senior citizens by supporting the legislation which removed the forced retirement requirement in the Federal civil service and postponed mandatory retirement in the private sector from age 65 to 70. In addition, the Administration worked with the Congress to amend the Older Americans Act in a way that will improve the administration of the Act's social and housing programs, employment provisions, food delivery, and establishment of centers for the elderly. This year the Administration will continue its efforts to ensure that seniors remain in the mainstream of American life, free from age discrimination and able to receive the assistance and other benefits they have earned. Veterans Our Nation has no obligation more basic than providing for those men and women who served us as members of our armed forces. There are still many veterans who need medical care, employment assistance, and assistance in adjusting to disabilities that resulted from their service. During the last two years we have made significant improvements in programs to help meet all these needs. In 1979 my Administration will seek legislation to increase compensation rates for disabled veterans, improve education programs for the disadvantaged under the G.I. Bill, provide special readjustment counseling assistance for those Vietnam Era Veterans who need them, and modernize the VA vocational rehabilitation program. These efforts will help veterans help themselves. In addition, we will continue to provide quality medical care in our VA hospital system by making it more efficient and thus more responsive to the needs of a changing veteran population. Education Improving skills and educational opportunities has been one of my Administration's major goals. To aid in this improvement, I have increased the Federal Office of Education budget authority alone by 505¢ since taking office—from $8 billion in FY '77 to $12.2 billion in the proposed FY '80 budget. The increased education funding will continue to be targeted at programs which emphasize equal education opportunity, support for local schools, student assistance, basic skills, and the linkages between school and work. School districts with high concentrations of low income children have extra costs in meeting their commitment to equal educational opportunity. Last year I proposed concentration grants which would give supplemental payments for compensatory education programs in high poverty school districts. This year I am requesting $400 million to fully fund this proposal. As is stated elsewhere in this Message, I will continue to work with the Congress to create a Cabinet-level Department of Education. Through such a Department we can make certain that education receives the attention at the Federal level that it deserves. Higher Education Last year, I signed into law the Middle income Student Assistance Act, which extends Federal student aid to middle income families facing rising college tuition costs. I propose to fully fund the Basic Grants program and to continue funding for the other college student aid programs. This year I will propose reauthorization of our omnibus higher education legislation-the Higher Education Act and the National Defense Education Act. Through renewal of these acts, we can help enormously to ensure the continuation of strong higher education institutions and equal educational opportunities for all students. Our Nation owes a debt of gratitude to the historically black colleges, which in the past were the only source of college education for talented blacks, and which today retain a critical importance to the production of college-educated black citizens. One-half of all college-educated blacks earned their degrees at black colleges. I have vowed that I would enhance the role of black colleges during my term in office. I recently directed all Federal agencies to utilize more fully the resources at black colleges. And, in my FY '80 budget I have increased funding for Howard University, and asked for $120 million to fully fund the Developing Institutions Program, which strengthens colleges with high concentrations of minority students. Science and Technology When I came into office, I found Federal efforts to promote basic research and development lagging. I was determined to change this situation and develop a sounder scientific and technological foundation for the future. Basic scientific research and development is an investment in the Nation's future, essential for all fields, from health, agriculture, and environment to energy, space, and defense. We are enhancing the search for the causes of disease; we are undertaking research to anticipate and prevent significant environmental hazards; we are increasing research in astronomy; we will maintain our leadership in space science; and we are pushing back the frontiers in basic research for energy, defense and other critical national needs. Despite the severe budgetary constraints this year, we will continue to increase Federal support for basic research with a request for a 13% increase in outlays for FY '80. Even though Federal funding for basic research is being increased, I believe that the government's role in demonstration and commercialization pilot projects should be more selective, with greater reliance upon private sector financing. We are enhancing our high technology approach to defense to counter the growth of Soviet forces. We have a broad energy research program that emphasizes longterm applications of solar, coal, geothermal, biomass and alternate nuclear technologies. But we will rely on industry to do its full part in the demonstration of new technologies in energy and in other fields. Rather than government funding of their research and development, companies need more favorable investment climates, better economic growth, better trade prospects, and sound policies about patents, antitrust, procurement, and environmental regulation. Under the direction of the Department of Commerce, we are also engaged in a major Cabinet-level review of these aspects of technological innovation, with participation of numerous individuals from various industrial sectors. Science and technology are playing an important part in our international relationships as well. Many countries, especially developing countries, look to America for our expertise and problem solving abilities. I have proposed the establishment of a Foundation for International Technological Cooperation (FITC) to foster collaborative efforts with people and institutions in developing countries. These efforts will be directed to basic human needs in agriculture, nutrition, health, small-scale energy systems, and rural development. Science and technology also have played a critical part in the dramatic advances of our relationship with the People's Republic of China. These scientific and technological relationships that will be built with China will be parallel to many such relationships we have established and enhanced over the years with other nations and groups of nations. Space Last year marked the 20th Anniversary of the National Aeronautics and Space Administration. The 21 st year started with the incredible success of the Pioneer missions to Venus. This year we hope to open a new era in space with the first launch of the Space Shuttle. Under the national civil space policy I announced last fall, we will remain dedicated to ensuring U.S. scientific and technological leadership in space. To further that policy, my budget request for FY '80 includes funding to maintain the Shuttle development and production schedule to continue space science and exploration; to initiate efforts on selected areas of advanced satellite communications techniques; and to enhance remote sensing activities that will bring benefits in areas such as earth resources, climate, weather, pollution and agriculture. Communications Last year we worked with Congress to reorganize communications policy-making in the Executive Branch and enact legislation to strengthen public broadcasting. In 1979 our priorities will include: • continued work with Congress on the important effort to revise the Communications Act to take account of technological changes; • vigorous pursuit of the program already underway to increase minority ownership of broadcast stations through regulatory actions, government loan guarantees, and private loan and training programs; • a program to use new communications technologies to improve rural life by delivering education, agricultural, and medical services and by increasing the diversity of radio and TV; • elimination of unnecessary regulations and paperwork requirements in cooperation with the Federal Communications Commission; • proposals on the role of the Postal Service in providing electronic mail services; and • participation in the World Administrative Radio Conference to ensure that increasing demands for radio frequencies are balanced in a reasonable and flexible manner. Small Business As a former businessman, I am especially sensitive to the importance of small business in our economy and to the vital role the Federal government can play in assisting small business. Through a number of actions over the past two years, my Administration has worked to help small business flourish and remain competitive. Under the leadership of the Small Business Administration, we have increased tax incentives significantly for small business; expanded small business loan opportunities; worked to increase small business exports; expanded opportunities for minority-owned small businesses; and initiated programs to increase small business opportunities for women. In addition, we have begun preparations for a White House Conference on Small Business in January of 1980 which will include local and regional conferences throughout the country. This year, while continuing efforts to prepare for the White House Conference, the Administration will work closely with the Congress to develop legislation to improve the operation and effectiveness of the Small Business Administration. Cultural Affairs Over the last decade, the National Endowments for the Arts and the Humanities have made enormous progress in developing projects and materials to enhance our Nation's cultural life. This year, the Endowments will continue their distinguished record of achievement. I am hopeful Congress will provide adequate funds for White House Conferences on the Arts and Humanities. This year we will also strengthen the programs of the International Communications Agency, which present the diversity of American culture to the world and deepen our appreciation of other cultures. PROTECTING BASIC RIGHTS AND LIBERTIES Since taking office, I have worked to protect and enhance the basic rights and liberties provided to Americans under the Constitution and our other laws. With the cooperation of the Congress, we have made important progress in this area. Over the next year, though, a great deal remains to be done if our goal of ensuring equality and basic freedoms for all Americans is to be realized. The dream of equal opportunity remains unfulfilled. I will do everything in my power to bring that dream closer to realization. Civil Rights Civil Rights and Equal Opportunity I take no obligation of my office more seriously than that of striving to secure full civil rights and equal opportunity for all Americans. In the quarter century since the Supreme Court's historic desegregation decision, our Nation's progress in these vital areas of human rights had been significant, but we have more to do. I am determined to use all of my authority to resist any efforts to weaken enforcement of any of our civil rights and equal opportunity laws. Recent actions by some in Congress to impair my Administration's efforts to enforce the law of the land will be forcefully opposed. These laws have made our society more open to equality of opportunity than virtually any on earth, and attempts to weaken them cannot be tolerated or allowed to succeed. My Administration has taken important steps to make civil rights enforcement more effective. The Justice Department has been diligent in its prosecution of civil rights violations. The Office of Federal Contract-Compliance Programs (OFCCP) and the Equal Employment Opportunity Commission (EEOC) has been reorganized and granted increased authority. The OFCCP will vigorously enforce the guidelines of Executive Order 11246, which prohibits employment discrimination by Federal contractors and requires affirmative action by these contractors. In addition the EEOC will continue this year to provide an effective central mechanism to enforce compliance with our equal opportunity laws. As we have done in recent cases before the Supreme Court, my Administration will continue to strongly support affirmative action programs to help bring minorities into the mainstream of American life, while opposing rigid and inflexible quotas which have no place in our laws. Beyond existing laws, however, as I state elsewhere in this Message, we need to ratify two Amendments to the Constitution which will significantly clarify and enhance the liberties and rights of Americans: The Equal Rights Amendment and the District of Columbia Voting Rights Amendment. The Equal Rights Amendment will provide women with equal legal status in our country. We cannot effectively champion human rights throughout the world until we have given to women the full rights they are entitled to as citizens. We must also work to ratify the amendment that will finally give the citizens of the District of Columbia the rights other Americans have to elect voting representation in Congress. In addition, we need to correct a weakness in an existing civil rights law. Title VIII of the Civil Rights Act of 1968, which prohibits discrimination in housing, remains largely an empty promise because of the lack of an adequate enforcement mechanism. I will soon propose to the Congress that this problem be alleviated by providing the Department of Housing and Urban Development with cease and desist powers. That Department, which now investigates and makes findings upon individual complaints, would then be able to enjoin further discriminatory acts and to direct an appropriate remedy. My Administration will work with the Congress to see that this proposal is given prompt and favorable consideration. Women One of the overriding concerns of my Administration is ensuring equal opportunity for women. Last year we worked closely with the Congress to extend the deadline for ratification of the Equal Rights Amendment until June 30, 1982. That extension will provide a greater opportunity to ensure ratification of this long-overdue Amendment. I will continue to dedicate myself, as well as the full resources of my Administration, to the ratification effort. This is not a battle that we can afford to lose. I am determined to win. The opposition to the Amendment cannot be solidly based on an understanding of its legal effect. The Amendment will do nothing more—nor less—than provide equality to more than one-half of America's population. I am confident that with the active support of the members of Congress from States which have not yet ratified, we can achieve ratification of ERA. I urge you to join the effort to provide women, at long last, with equal rights under the law. My Administration has championed, and will continue to champion, the right of women to choose their roles in society. To protect those who have chosen the role of full-time homemaker: • We have succeeded in enacting legislation that provides assistance for displaced homemakers and we supported the legislation that has now reduced from 20 to 10 years the marriage requirement for a former wife to claim against her husband's social security entitlement. We are facilitating the choice of many women to combine family and work responsibilities. To accomplish this goal: • we supported the legislation passed to increase part-time and flexible-hour employment opportunities; and • we supported the Pregnancy Disability Act that outlaws employment discrimination based upon pregnancy, childbirth, or related conditions. We are striving to improve women's professional opportunities within the Federal government. To this end: • women have been appointed in senior positions in the Administration, including two Cabinet officers. About 20% of my senior appointees have been women, and many of them are in areas in which no previous women had served; and 
• we have strengthened and increased our equal employment opportunity enforcement. This year, in addition to continuing our efforts to ratify the Equal Rights Amendment, we will work closely with the Congress to enhance the economic standing of women—particularly the poor, minority, and elderly—by improving their access to housing, health care, and child care for those who choose to work. We will expand additional opportunities this year for women business owners and will create a permanent interagency group to review and help improve the position of women business owners. I will make every effort to select as many women as possible to fill the 152 new Federal judgeships. Their under-representation in the courts cannot be continued.. Our country needs and deserves the full participation of women in our society, and I am committed to taking the steps needed to ensure this partnership. District of Columbia My Administration worked with the 95th Congress to pass a proposed amendment to the Constitution granting full voting representation to the citizens of our Nation's Capital. The ratification process for this proposed amendment has begun and I urge the state legislatures which have not ratified the resolution to join with the States of New Jersey, Ohio and Michigan by promptly ratifying the amendment. My Administration will work this year in the effort to ratify this amendment. My Administration will also work closely with the Congress and the new District Government under Mayor Marion Barry to expand home rule for the District. This includes streamlining the procedures for Congressional review of locally enacted legislation, removal of the Federal government from the District budgetary process by 1982, developing a rational formula for determining the Federal payment to the District, and an equitable Federal sharing of financial responsibility for funding of the District's pension plan for police, firemen, teachers and judges. I will work with Mayor Barry to make our Nation's Capital city a model for the rest of the Nation to emulate. Native Americans The Federal government has a special responsibility to native Americans, and I intend to continue to exercise this responsibility fairly and sensitively. My Administration will continue to seek negotiated settlements to difficult conflicts over land, water, and other resources and will ensure that the trust relationship and self-determination principles continue to guide Indian policy. There are difficult conflicts which occasionally divide Indian and non-Indian citizens in this country. We will seek to exercise leadership to resolve these problems equitably and compassionately. Handicapped For Americans with physical disabilities, this year will result in continued improvements in their accessibility to many opportunities those of us who are not disabled take for granted—education opportunities, employment opportunities, and greater access to public facilities and services. We will make further progress in removing obstacles that impede and discriminate against our disabled community. If our Nation is to remove the barriers of discrimination in our society, the Federal government must serve as a model in the successful removal of physical and psychological barriers thrown in the way of our Nation's disabled. The Section 504 Regulations issued by the Department of Health, Education, and Welfare provide a basis for the Federal government to lead the way in ensuring the rights of the handicapped. Undocumented Aliens One of the most difficult and sensitive domestic issues facing the country concerns the Federal government's policy toward undocumented aliens. I continue to believe that effective but humane measures need to be devised which will help relieve the causes and effects of the presence of large numbers of undocumented aliens in this country. I will pursue this issue in my consultations with the government of Mexico during my visit there next month and will make no final decisions until after those consultations. Martin Luther King, Jr. Dr. Martin Luther King, Jr. led this Nation's effort to provide all its citizens with civil rights and equal opportunities. His commitment to human rights, peace and non-violence stands as a monument to his humanity and courage. As one of our Nation's most outstanding leaders, it is appropriate that his birthday be commemorated as a national holiday, and I will strongly support legislation to achieve this. Minority Business This year we will move vigorously to implement the strong minority business legislation enacted by Congress in 1978; meet my goal of tripling Federal procurement from minority businesses (to a total of $3 billion); faithfully implementing the minority set-aside programs of the government and improve the operation of the several programs designed to achieve equal entrepreneurial opportunity and vital minority economic development. We are currently evaluating the adequacy and organization of current minority business development programs, with the commitment to taking whatever action, legislative or administrative, is needed to ensure that their operation is efficient and effective. Civil Liberties Privacy Government and private institutions collect increasingly large amounts of personal data and use them to make many crucial decisions about individuals. Much of this information is needed to enforce laws, deliver benefits, provide credit, and conduct similar, important services. However, these interests must be balanced against the individual's right to privacy and against the harm that unfair uses of information can cause. Individuals should be able to know what information organizations collect and maintain about them; they should be able to correct inaccurate records; and there should be limits on the disclosure of particularly sensitive personal information. My Administration is developing a comprehensive privacy policy to address these concerns. Last year, legislation was enacted which established restrictions on wiretapping for intelligence purposes and on government access to financial records. Early in 1979, I will propose privacy legislation to cover medical, financial, and other sensitive personal records. I will also • take administrative actions to strengthen 
privacy controls for Federal agencies' records. These measures will go far toward giving all American citizens the privacy protections they need in a modern society. I recently announced my intention to submit legislation to Congress protecting the rights of the press, and others preparing materials for publication, from searches and seizures undertaken without judicial approval. Under the legislation I will propose, Federal, State and local law enforcement officials will generally be required to obtain a subpoena before conducting a search or seizure against those preparing materials for publication. Such legislation, which would deal with the problems created by the Supreme Court's decision in the Stanford Daily case, should serve as a solid protection of the rights of the news media and others under the Fourth Amendment. Labor Law Reform The Nation's labor laws are vital to ensuring that a sound labor-management relationship exists in collective bargaining. Efforts to abuse those labor laws, especially by unduly slowing or blocking their implementation, have increased in recent years. As a result, a reform of our labor laws is required in order to guarantee that their intended spirit is fully observed and enforced. I am again prepared to work with the Congress to develop legislation which improves the fairness and effectiveness of our labor laws. Efforts to defeat this legislation last year were based on emotion and a lack of information about its actual effect. If the will of the majority in Congress is allowed to prevail, we can enact sound labor law legislation. Export Administration/Anti-Foreign Boycott My Administration will work with the Congress to reauthorize the Export Administration Act, which plays a vital role in ensuring that American trade serves our national interest. We will make particular efforts to reauthorize that part of the Act which prohibits American compliance with the foreign economic boycott of Israel. The anti-boycott amendments passed by the Congress were fair and equitable and must continue to be strenuously enforced. Intelligence Charters I will be working closely with the Congress to develop and enact statutory charters for the intelligence community. The charters, for the first time, will define in law the duties and responsibilities of our intelligence agencies and will set forth the authority of those agencies to fulfill those responsibilities. The disclosures of abuses in recent years make clear the need for charters, and my Administration is strongly committed to developing and passing charter legislation that protects our citizens' rights, while permitting our intelligence agencies to perform. effectively their essential duties. Criminal Code The Federal criminal laws are often archaic, frequently contradictory and imprecise, and clearly in need of revision and codification. My Administration will continue to work with the Congress to develop a Federal criminal code which simplifies and clarifies our criminal laws—as well as protects our basic civil liberties. The criminal code which passed the Senate in the last session can serve as a basis for progress this year. Hatch Act Reform We will continue to support efforts to reform the Hatch Act so that Federal employees in non-sensitive positions will have the right to participate in off-the-job political activities while preventing any on-the-job political abuse. Hunger We share a growing concern with other Nations and their people over the serious problem of world hunger. While our government and the governments of other Nations and international organizations are working to assure the basic right to food, the problems of hunger and malnutrition are a daily fact of life for millions of people throughout the world. In order to make our own programs more effective and to examine additional efforts that might be undertaken, I have established the Presidential Commission on World Hunger, under the leadership of Ambassador Sol Linowitz, to recommend realistic solutions which we and other Nations might undertake in a prompt and efficient manner. The Commission will report to me this year and will then be involved in the implementation of its recommendations. The Administration will be working closely with Congress on the Commission's recommendation. Holocaust Commission Last year I established a Holocaust Commission to recommend to me how our government might officially recognize, for the first time, the tragedy of the Holocaust. The Commission's work is well underway, and I will receive its report this year. I expect to work together with Congress in developing a suitable memorial to the millions who died in the Holocaust. PRESERVING AND DEVELOPING NATURAL RESOURCES My highest legislation priority during the 95th Congress was enactment of our first national energy plan. The dedication of many members of Congress made that goal a reality. My Administration is committed to using that legislation as the foundation for further efforts to reduce our dependence on foreign oil; to increase our ability to develop domestic energy sources; and to conserve wasted energy. Our energy and other development goals can and will be reconciled with the Administration's resolve to clean the Nation's air and water and to preserve our most precious natural resources. We will continue to further the protection of our environment. We will continue to develop our fertile agricultural land. The Administration is committed to helping our Nation's farmers continue to achieve record yields and exports. Energy The Administration remains committed to meeting our future energy needs. Building upon the framework of the National Energy Act, signed last November, we will be addressing key issues such as further developing and commercializing solar and renewable energy resources, making better use of our coal reserves and other abundant energy resources, continuing our emphasis on using energy more efficiently, and improving the manner in which we produce and use conventional sources of energy such as oil, natural gas, and uranium. To minimize the impacts of potential supply disruptions, we will continue the storage of oil in the Strategic Petroleum Reserve, and will be submitting for Congressional approval overall energy contingency plans. While much remains to be done in the energy area, past investments in improving our energy supplies and our energy use are beginning to pay off: the rate of growth of our industrial energy use has dropped while industrial production has increased. From 1975 to 1977 the growth in domestic energy consumption has been 70% of the growth in GNP Previously, the two growth rates had been roughly equal. With significant improvements in automobile efficiency, gasoline consumption is an estimated 5% lower than it otherwise would have been. Use of heating oil, electricity, and other home energy sources has become much more efficient. Oil consumption grew last year at a rate of only 1.5%. On the supply side, the new natural gas legislation, whose provisions have just begun to take effect, will ensure new domestic production of this premium fuel and help expedite the delivery of natural gas to the interstate market. Furthermore, due to the addition of Alaska North Slope oil, our domestic production of oil has held steady over the last year, and foreign imports were down in 1978. In 1979 and the FY '80 budget we are continuing strong investments in energy research and development. The FY 1980 budget provides outlays of $3.7 billion for a wide range of programs to develop energy technologies for the future. Particular emphasis will be given to long-term solar energy research and development, to improvements in the mining and burning of coal, fission and fusion research, to improvements in existing technologies for conservation, oil and gas recovery, and uranium efficiency, and to energy-related basic research. These commitments to technologies for the future, both long and shorter term, are critical to a sound and comprehensive energy policy. Solar Energy Within the next few weeks, I will send to the Congress a message on solar energy based on an interagency study under the Domestic Policy Review System. The transition to wide-spread use of solar and renewable resources can and must begin now. Solar, wind energy, and use of biomass resources can contribute significantly in both the short and long run to meeting our Nation's energy needs. Some of these technologies, such as solar heat and hot water, use of biomass for generation of electricity, and wind energy, are available now and are competing with other conventional energy sources. The tax credits in the National Energy Act, along with other commercialization incentives, will help accelerate the use of solar and other renewable technologies in the residential and industrial sectors of our economy. The FY 1980 Budget increases our government-wide solar research and development programs by 40% over FY 1979. Total expenditures for solar energy will exceed $800 million, including tax credits and important initiatives undertaken by the Department of Energy, the Agency for International Development, the Tennessee Valley Authority, the Department of Agriculture and the Small Business Administration. Application of solar technologies in federally-owned buildings will also increase, thereby providing new markets for our existing solar industry. In our research and development program, strong emphasis will be given to photovoltaics through which electricity can be produced directly from solar energy. Conversion of organic materials to useable energy forms will also receive increased funding. Funds for the new Solar Energy Research Institute at Golden, Colorado, will also be increased. The proposals I will later announce, coupled with the FY '80 budget, will chart a firm and ambitious course for accelerating the use of solar and other renewable energy sources both now and in the future. The time for solar energy has come. Other Energy Research, Development, and Demonstration In the coming year, significant investments will be made in the demonstration of technologies which can convert coal to more useable and environmentally acceptable energy forms, continued strong research and development in fusion, development of geothermal energy sources, such as hot underground brines and hot rock resources, and efforts to resolve a range of environmental issues which these and other technologies raise. Nuclear Energy A wide range of Administration initiatives, both legislative and administrative, will be proposed to ensure that this country can further use light water reactors for the generation of electricity, safely and efficiently. Of central importance will be the development and implementation of a strong, responsible program to manage and dispose of nuclear wastes. As a result of the work of the Interagency Review Group on Waste Management, I will be making a series of legislative and administrative recommendations to ensure that the necessary schedules, coordination, and legislative authorities are firmly in place. Public discussion and participation in the nuclear waste management area, along with the close cooperation of State and local elected officials, will receive continued high priority. Legislation will also be proposed to provide interim storage for spent fuel from existing reactors until a permanent waste repository is established. Enactment of nuclear licensing and siting legislation to shorten the lead times required to plan, locate, construct and license nuclear power reactors will again be sought. Design and construction activities for the new centrifuge enrichment plant at Portsmouth, Ohio, will continue to ensure that the U.S. is able to meet the nuclear fuel needs of our domestic industry, as well as our international customers who share our non-proliferation objectives. These activities, coupled with the Administration's waste management program will help ensure that our country can continue to rely on current nuclear technologies to meet power needs. Looking toward the future, we will seek to improve the efficiency of our existing power reactors by reducing their uranium feed requirements. For the longer run, the Administration will maintain and strengthen the strong research and development program we now have for more advanced nuclear fission technologies such as the fast breeder reactor. We continue to believe that the Clinch River Breeder reactor project is premature, technically inadequate, and should not go forward, but the Administration is committed to keeping the breeder option open for the future. Domestic Crude Oil Pricing Provision of adequate incentives for both domestic production of crude oil and for conservation must be carefully weighed in light of our efforts to control inflation. In consultation with the Congress, I will be making my decisions and recommendations on domestic crude oil pricing and related issues later this year. Energy Impact Assistance As new domestic energy resources are developed, particularly in rural or isolated areas of the country, provision must be made for the needs of rapidly developing communities. The Administration will again seek enactment of legislation establishing an Inland Energy Assistance program, with funding of $150 million per year, to aid those states and local areas which are experiencing a rapid growth in population as a result of new energy supply development. These communities often cannot plan for or meet increased need for new public facilities or services, since the population increases occur before the new energy supply activities are fully developed and producing local revenues. This legislation is essential to ensure that the burdens associated with solving our energy problems are borne equitably by all citizens and regions of the country. Management of Federal Energy Resources The last two Congresses passed landmark legislation to reform the management of federally-owned coal, oil and gas resources. These new laws include Federal strip mine controls, and amendments to the Outer Continental Shelf Lands Act and the Mineral Leasing Act. With this new framework, the Administration is proceeding to implement swiftly new programs which will permit increased leasing and development activities while protecting our environment. Water Policy Legislation Water is a basic human necessity and its proper management is essential to economic activity, particularly in the arid West. The policies of my Administration are designed to emphasize the more efficient use of water as well as the need to provide adequate water supplies. We are particularly sensitive to the interests of the West and other areas in the development of additional water resources, to the importance of water conservation, and to the concerns of many Eastern urban areas about their water systems. Last year I announced a comprehensive water policy which included many reforms now being implemented administratively. In addition, I will propose legislation to increase the role of the States in water policy, through increased water planning grants and through new grants for state water conservation programs. I will also propose legislation which would provide for states to share in the costs of Federal water projects. This cost proposal will result in direction by states in setting water project priorities and will help insure that Federal programs are responsive to the most pressing water-related needs. Congressional action is also needed on Administration Amendments to modernize the 1902 Reclamation Act to ensure that acreage limitations in federally funded irrigation projects are equitable and fair. Environment My Administration is committed to balancing the needs for development, conservation and preservation of our natural resources. Our Nation has been blessed with an outstanding natural heritage which, if properly cared for, can meet our needs for food and fiber, mineral, energy, recreation, and solitude in a way that is environmentally sound. The Congress and the Administration have worked together, over the past two years to achieve this goal. We have enacted the first Federal standards for strip-mining coal; we have improved and extended the Clean Air and Glean Water Acts; we have created a substantial number of new National Parks and other protected areas. During 1979, protection of Alaska lands, implementation of water policy, resolution of wilderness and nonwilderness designations in the National Forest System and reformed management of Federal energy resources will be major environmental initiatives of my Administration. Efforts to enforce and implement environmental statutes firmly and fairly, to streamline environmental review requirements, to protect public health and to preserve wildlife resources will continue to be pursued vigorously and as cost-effectively as possible. Alaska As in the last Congress, passage of legislation designating National Parks, Wildlife Refuges, Wilderness Areas, National Forests and Wild and Scenic Rivers in Alaska is the highest environmental priority of my Administration. To protect these magnificent. Alaskan wild lands, I took several actions after the adjournment of the 95th Congress, including the creation of 17 National Monuments covering 56 million acres. These areas, as well as other outstanding parts of Alaska covered in Administration proposals, should be protected promptly by legislation in order to assure that the great national treasures of wildlife, scenery, history and untouched ecosystems can be saved for our children and grandchildren, while permitting appropriate commercial use of certain of the areas. Roadless Area Designations (Rare II) The Agriculture Department has released tentative recommendations and nearly completed work on a study which will lead to proposals to resolve the status of most of the remaining roadless areas in the National Forest System. The Administration proposal will involve additional wilderness designations in many States and the release of remaining lands for nonwilderness activities. This initiative will also eliminate uncertainty over land uses in most parts of the National Forest System and will ensure that development uses will be adequately supported, while preserving critical parts of our natural heritage in an unspoiled condition. Environmental Protection In recent years, the quality of our environment has improved, but much remains to be done to clean up our air and water, and to control contamination by toxic materials. The Environmental Protection Agency is focussing its efforts on the protection of public health by assessing the effects of substances before they are introduced into the environment, and by ensuring that hazardous wastes are disposed of safely. At the same time, EPA, and the other health and safety agencies are exercising new care when implementing environmental regulations to avoid imposing unnecessary costs or red tape. A healthy, safe environment need not be incompatible with a healthy economy. We are committed to both. The Nation's investment in environment cleanup must have the incentives and the flexibility to allow our most important environmental goals to be achieved at the lowest cost. Unnecessary requirements which cause delays and increase costs will be removed. EPA will simplify and consolidate its permit programs to reduce paperwork, red tape and delays. The Agency is beginning to introduce innovations which allow firms the flexibility to find the lowest cost methods of controlling pollution. I will submit legislation to consolidate Federal funds for environmental programs at the State level, thus giving the States more flexibility to use these funds to deal with their most pressing environmental problems. These and other changes we are making will assure the American public that the money we spend on environmental controls is the best investment we can make in our future and our children's future. The State of Food and Agriculture World food security has been substantially improved in 1978. For the third consecutive year, good-to-record crops were harvested in most parts of the world, pushing supplies to record quantities and creating the opportunity for people all over the world to improve their diets. For the United States, 1978 was also a year of records. Large food and record feed grain crops were harvested by U.S. producers, re-emphasizing the U.S. farm sector's capability to lead the world in productivity. But despite the record crops which placed downward pressure on prices here and abroad, our farm economy became stronger in 1978 and our agricultural trade reached record levels. The value of U.S. agricultural exports reached $27.3 billion in fiscal 1978—14 percent above 1977's record. The volume of our farm exports was a record 125 million metric tons—up 18 percent from 1977. Agricultural trade made another record contribution to our balance of payments—$13.4 billion in fiscal 1978. Exports also accounted for one out of every four dollars the U.S. farmer earned. Net farm income, which was $20.6 billion in 1977, is estimated at over $28 billion for 1978—second highest on record. In constant dollars, this was the best year since 1975. This was achieved while we met our domestic needs, fulfilled our commitments to our overseas customers and built reserves for future stability protection. This recovery in agriculture has been shared by crop and livestock producers alike. Indeed, American livestock producers can now look forward to several years of good returns to help them recover from the last four years which were marked by poor prices and forced liquidation of herds. Part of the recovery in the farm sector can be attributed to the programs and policies adopted by my Administration and the Congress—which farmers have used to improve their incomes and stabilize prices. I am personally proud of the recovery our farmers have made. International Agricultural Trade Over the past 2 years, this Administration has worked to reduce barriers to international trade and to develop new markets and encourage increased exports of agricultural products. The Agricultural Trade Act of 1978, for example, provides important new authorities for intermediate credit and the establishment of trade offices in major markets. We have moved to establish new and stronger trade ties with several nations, including Japan and the People's Republic of China. Partly as a result of these efforts, exports of U.S. farm produced goods are expected to reach a record $29 billion in fiscal 1979-21 percent higher than 2 years ago—and contribute $15 billion to our balance of payments. Unlike previous Multilateral Trade Negotiations, in the current MTN we have placed heavy emphasis on the lessening of restrictions on trade in agricultural products. Our efforts here should have a major impact on U.S. agriculture in the future, by broadening our access to important existing and new international markets. Crop Insurance The Federal government now operates several programs to protect farmers from economic losses associated with crop failure. The experience of recent years with these programs has demonstrated their many serious shortcomings—in the breadth of coverage, the equity of program benefits, and the efficiency of program administration. We will propose again a comprehensive, nationwide all-risk insurance reform bill to the 96th Congress aimed at providing fairer and more effective protection for farmers, and at no additional cost to the taxpayer. Under this proposal, several existing disaster assistance programs would be consolidated into one comprehensive, share-the-cost program to ensure against economic losses resulting from natural disaster and other uncontrollable risks. International Emergency Wheat Reserve The cornerstone of our domestic food and agricultural policy is the farmerowned grain reserve. In little more than a year, we have built this into a 1.3 billion bushel grain reserve—the equivalent of more than a third of our carry-over stocks from the past year. These stocks remain under the ownership of those farmers who produced them rather than in the hands of government or international grain traders. This reserve provides a critical cushion against shocks in the market caused by production shortfalls either here or abroad. We now need to establish the same sort of protection for our international food aid programs. Accordingly, the Administration will reintroduce legislation to authorize the establishment and management of an international emergency wheat reserve. This reserve will provide developing countries assurance that we will be able to fulfill our food aid commitments. At the same time, it will protect the domestic economy from further inflationary pressures during periods of grain shortages. Sugar In the absence of Congressional passage of a domestic sugar program in the last session, the Administration has taken several further steps to assure domestic producers of a fair return and consumers an assured supply at stable prices. To underscore Administration commitment to achieving ratification of the International Sugar Agreement, I directed that sugar imports from countries not party to the agreement be strictly limited to the levels permitted under the agreement for 1979. We have also asked for and received an extension of the deadline for ratifying the ISA to June 30, 1979. In addition, at the end of last year, I issued a proclamation that provides for a new, more flexible system of sugar import fees protecting a domestic raw sugar price of 15 cents per pound. To help stabilize world sugar prices, to satisfy our international commitments, and to protect our domestic sugar producers, my Administration is committed to working with the Congress to develop an effective, non-inflationary domestic sugar program early in this session, and to achieve ratification of the International Sugar Agreement. Rural Development Throughout 1978 my Administration took steps to make existing Federal rural development programs work better. For many rural areas, and for most rural residents, the 1970's have been a period of rapid growth and development. Income levels have risen and large numbers of better jobs have been created in rural communities across the Nation. Rates of population and employment growth for rural areas have been substantially greater than for urban areas—causing problems of unplanned rapid growth in some areas but also reversing decades of rural out-migration and economic stagnation. Nevertheless, rural Americans still experience a disproportionate concentration of pressing human problems: • two-thirds of all homes lacking complete plumbing are in rural areas; • rural infant mortality rates are 10 percent higher than urban ones; • 70 percent of the rural poor and half of the rural elderly have no automobile, causing great hardship because of the distances to travel to get access to basic health care, jobs, and other social services; • while only a quarter of all Americans live in rural areas, 40 percent of the Nation's poor live there. For too long the small town mayor, the rural county official and the individual rural American have been frustrated by a maze of Federal grant applications, requirements, eligibility standards, audits and deadlines which have made it virtually impossible to address these rural problems effectively. For too many years, money and time has been wasted. We are moving to address this chronic problem. In the last year, White House Rural Development initiatives have resulted in: • a commitment to build 300 rural primary health clinics to serve 1.3 million Americans who lacked access to care; • major streamlining of the rural water and sewer grant process through which five agencies distribute $2.5 billion in Federal funds each year. The new process permits a single application, single audit, single funding source and single point of Federal contact—at a savings to local government of several hundred million dollars each year along with a reduction in processing time of as much as 15 months; and • specially targeted rural job training programs for rural disadvantaged in the water and sewer and health support fields. This effort to address rural problems will continue and be expanded in 1979, addressing the problems of rural transportation, housing, and economic development among others. In addition, during the year I plan to articulate a set of overall rural development principles and goals which will guide the actions of my Administration. These principles will provide focus, direction and priority to the myriad of now separate Federal actions and policies, so that we can more effectively work to: • overcome the problems of rural isolation; 
• promote economic development; 
• meet basic human needs; 
• protect the quality of rural life; • assure equity in the administration of Federal programs for which rural Americans are eligible; and • build a more effective partnership among Federal, State .and local governments and the private sector in meeting locally defined rural development priorities. Furthermore, several other Administration initiatives will have an impact on the conditions in rural America. We will make certain that the rural perspective is considered as initiatives are developed in such areas as welfare reform and a national health plan. FOREIGN POLICY PRIORITIES 
THE CONTINUING CHALLENGES OF CHANGE When I took office two years ago this month, I was convinced that America had to pursue a changed course in a world which was itself undergoing vast change. In the midst of this accelerating change, America's choice lies between facing chaos or building with others a new foundation for a true world community. Our foreign policy accepts the latter responsibility both because of our basic belief, and because of America's critical role in the world. To this end, we must have four broad objectives: • to buttress American power on which global security and stability depend; • to strengthen our relations with other nations throughout the world in order to widen the spirit of international cooperation; • to deal constructively with pressing world problems which otherwise will disrupt and even destroy the world community we seek; • to assert our traditional commitment to human rights, rejoining a rising tide of belief in the dignity. of the individual. Progress towards these goals depends first on our ability as a Nation to work together in the common interest. During the coming year, the Congress, the Executive, and the public will be addressing an unusually wide range of international issues. The action taken will have an impact on our Nation's position in the world for many years to come—in establishing a secure nuclear balance, in developing closer relations with the world's most populous Nation; in achieving an historic step towards peace in the Middle East; or in setting the pattern of trade relations during the next decade and beyond. This report elaborates on my address to the Congress and, in particular, concentrates on the issues in which the role of the Congress will be most important to building a new foundation for peace. In each case, the challenge is clear: to exercise strong American leadership with others to shape change rather than permit change to shape us. AMERICA'S MILITARY STRENGTH Elsewhere in this report I have described the domestic programs and policies required for a just, united and productive America. The maintenance of American military strength is an essential foundation for a successful foreign policy that safeguards our freedom, our accomplishments and our friendships. In a world of accelerating change, fraught with potential danger and uncertainty, and marked by a continuing Soviet military buildup, we must have, together with our allies, unsurpassed military capability to deter attack or attempts at political coercion. Moreover, we must have the military force to mount an effective defense at any level of hostilities where our vital interests are jeopardized. The defense budget which I have presented to the Congress funds a program of prudent investments that will ensure the effectiveness of our strategic and conventional military posture. It will: • begin full-scale development of a new, more survivable ballistic missile system to enhance the ICBM component of our strategic triad; • maintain the Trident submarine and missile programs, increasing the security, striking power and the range of our submarine force; • extend the effectiveness of our bomber force with the addition of air-launched cruise missiles; • pursue a vigorous program of research and development in cruise missiles, aircraft and other systems to ensure the continued technological superiority of America's nuclear deterrent. In addition, the defense budget I have submitted this week will strengthen our conventional capabilities to fulfill our commitments to our major allies and friends and retain a credible military presence in both the Atlantic and the Pacific. We will continue to add armor and firepower to our infantry and build a more modern, smaller aircraft carrier which, together with more frigates and destroyers, will improve the effectiveness and flexibility of our surface fleet. In NATO, we have already achieved important progress toward making the Alliance more effective in the changing security environment. • We helped launch the Alliance's Long-Term Defense Program to offset growing Soviet modernization of its deployment in Europe. The LTDP will increase NATO military capabilities through better coordination of defense efforts, increased investment, and more modern equipment. • We removed, with the support of Congress, a serious obstacle to strengthening Turkey's defensive capabilities and made further progress toward the reintegration of Greek armed forces into NATO's military structure; both these efforts helped repair a serious deficiency on NATO's southern flank. • We neared final agreement with the Portuguese on the renewal of our base rights in the Azores. The provision of adequate military as well as economic assistance to Turkey, Portugal and other allies and friends in need will be a matter of high priority during the coming year. NATO's strength is growing. In 1979, we can further that encouraging process by standardizing more of the Alliance's equipment and improving Allied readiness. The proposal I will soon put before the 96th Congress calls for the authorization of intergovernmental agreements to simplify logistical problems both in peacetime and during any period of hostilities. Such agreements will permit the U.S. to reinforce NATO more rapidly and provide more effective defense at lower cost. We also intend to maintain a vigorous American military presence in the Pacific. Successful completion of a revised military base agreement in the Philippines, following ten years of negotiations, provides an essential underpinning for our military capability in Asia. Congressional authorization for the transfer of military equipment to the Republic of Korea was another contribution to assuring the security of Korea and Japan. Both actions unmistakably signal not only our desire to promote East Asian stability but our intention to remain a concerned, involved and responsible power in the Pacific. The essential task of improving our military posture must also be accompanied by increased efficiency. I take this opportunity to thank the Congress for its support last year of our actions to reduce waste and needless duplication in our defense budget. Vigorous cost-saving efforts will continue this year in order to assure that the United States will possess strong military forces at the lowest possible cost. BUILDING THE COMMUNITY' OF NATIONS Military strength is essential to peace but cannot alone guarantee it. The system of cooperation we have with the rest of the world is part of the foundation for our own security. Our best hope for a safer America and a peaceful world resides in the building of closer ties with as many nations as possible. The Major Allies Throughout 1978, the North Atlantic Alliance and the growing partnership which links us with both Western Europe and Japan remained at the heart of our foreign policy. The cooperation we share with those whose purposes and traditions are closest to our own is strong and growing stronger. Through our summit meetings, and through an unprecedented pattern of consultations at other levels of our governments, we are working together on virtually all of today's most critical issues: • together we are seeking to reduce the risk of nuclear confrontation; • we are working on ways to strengthen the common defense; • we are attempting to promote a peaceful transition in southern Africa; • we are striving to resolve conflicts in the Eastern Mediterranean to support a just and lasting peace in the Middle East and to maintain stability in the Persian Gulf; • we are contributing to a sounder international economy; • we are consulting on the issues that confront all our societies: the problems of youth and age, family and community, growth and conservation—in short, advancing our democratic ideals at home in a time of change in each of our countries. America's role as host for the NATO summit meeting in Washington last spring, and our attendance at the seven-nation economic summit in Bonn last summer, symbolized American commitment to the strength of relations with Europe and Japan. I look forward to meeting these and other allied leaders at the Tokyo Summit next June, where we will continue the essential effort to deepen further the cooperation between us. A Wider Community The changing realities of political and economic interdependence require that we strengthen our ties throughout the developing world and seek to improve relations with Communist nations as well. My trips to Nigeria, India, Saudi Arabia, Iran, Brazil, and Venezuela underlined American sympathy and support for the international roles these countries are playing in the process of world change. Strengthened consultations with the ASEAN nations serve the same end. My trip to Mexico early next month will be a part of this process; Mexico is important to us not only because it is a neighbor but also because it is one of the most vigorous democracies in this Hemisphere and a leader in the developing world. As neighbors, we share an agenda of common concerns—trade, migration, economic growth and social development-that provides an opportunity to establish a uniquely productive, cooperative relationship. My trip to Poland and the visits of Secretary Vance and Secretary Blumenthal to Hungary and Romania underscore the importance we attach to better relations with the nations of Eastern Europe. The support of the Congress for our policy toward Eastern Europe has provided a strong foundation for building a stronger economic, cultural and political relationship—a process that will continue to go forward in the coming year. China The arrival next week of the first leader of the People's Republic of China to officially visit Washington will give us an early and welcome opportunity in the new year not only to cement the ties of friendship and hospitality between us but to emphasize our expectation that our relationship with China will be a constructive one. It will contribute to diversity in the world and to peace and stability in Asia. It is not directed against the interests of any other country. To fulfill the promise of this new era in Sino-American relations, we will require legislation and support from the Congress. Such legislation is particularly important to facilitate continued trade and other relations with the people of Taiwan through non-governmental instrumentalities and to assure continued peace and prosperity there. This has very high priority in our legislative program for 1979. USSR We seek better relations with both the Soviet Union and the People's Republic of China. Doing so is profoundly in the interests of our Nation and of global security. I therefore would like also to welcome President Brezhnev to our country in the near future. At that time we would hope to conclude an agreement curbing the strategic arms race. There are other areas where our two nations can work constructively together. These include a comprehensive nuclear test ban treaty; limits on Indian Ocean deployments, and on the transfer of conventional arms; and restraint in areas of turbulence and tension. Such cooperative effort would do much to make the world a safer place for all. We will never ignore Soviet actions which challenge our interests. We both have a responsibility to our peoples and the world to maintain a pattern of detente which is genuinely reciprocal and broadly defined. DEALING WITH WORLD PROBLEMS A true world community cannot be fashioned or endure so long as the weapons of war multiply and spread, so long as ancient disputes fester and the demands for justice are unmet, so long as much of mankind remains impoverished and without hope. As I emphasized in my State of the Union address, the need to curb the strategic arms race has never been more urgent. It increases the risk of nuclear war. It is a needless competition that draws away scarce resources we need to invest in other areas of our Nation's strength. It undermines America's security. The conclusion and ratification of a satisfactory SALT II Treaty with the Soviet Union is therefore among our top priorities. It will make a major contribution to enhancing our long-term security, while keeping open our options to carry out needed modernization of our strategic forces and preserve our deterrence. We will take whatever time is necessary to negotiate a sound, verifiable agreement. I am convinced that once the American people and Congress have had a chance to examine the terms and benefits of this Treaty—and consider the shape of our future without it—they will conclude it serves our vital security interests. We will continue to consult the Congress as we proceed this year with other important arms control negotiations: on a comprehensive nuclear test ban; the prevention of anti-satellite warfare; mutual and balanced force reductions in Europe; and limits on the rising tide of conventional arms transfers. The risks inherent in the proliferation of nuclear technology figure prominently among the dangers to the world community. Although we and the rest of the world still have far to go in dealing responsibly with such risks, the United States took an important step last March with the adoption of the Nuclear Non-Proliferation Act. For the first time in our history we established comprehensive legislation covering international cooperation in the nuclear field and the export of nuclear-related materials. To build on that promising beginning throughout 1979, we need progress in the following areas, both nuclear and non-nuclear: • The International Nuclear Fuel Cycle Evaluation (INFCE), a 53-nation effort, can help us develop a new international nuclear fuel consensus that will adequately balance energy needs with non-proliferation concerns. We continue to believe that better alternatives exist to the commercialization of dangerous breeder reactors and we will cooperate as fully as possible with other countries in exploring those alternatives. • We will seek more substantial progress in the problem of managing nuclear waste and in attracting greater international support for the acceptance of nuclear safeguards. I ask the Senate to ratify the treaty on the IAEA Voluntary Safeguards Offer which will provide concrete proof of our belief that international safeguards do not interfere with the successful development and operation of commercial nuclear power. • I will call for early Senate ratification of Protocol I of the Treaty of Tlatelolco, which will contribute to the lessening of nuclear dangers for our Latin American neighbors; the U.S. and Cuba are now the only countries in our Hemisphere which have not yet ratified that Treaty. Regional Conflict and Tension Curbing the means of war cannot in itself remove the threat of war. For that, we must seek to resolve conflicts, ease tension and build trust. The urgency of this task and its importance to the United States and the world is nowhere more clear than in the Middle East. Though there has been great progress, the goal of a just and lasting settlement in that troubled part of the world still eludes us. No one who has looked at Middle East history can harbor any illusion about the difficulties ahead. Yet we have made great strides toward a final peace agreement between the two principal adversaries in the Middle East. The differences which they have overcome far outweigh the issues which still divide them. Israeli and Egyptian commitment to peace will provide an indispensable step toward peace between Israel and all its neighbors and foster the stability and orderly change we favor for the entire Middle East region. Peace will permit us to strengthen our ties with the Arab states in the region and enhance our relationship with Israel, a relationship which will always be special to us. In 1979 I will count on the continued collaboration of the 96th Congress on behalf of our efforts to gain and maintain peace throughout the region. The support of the Congress and the American people for a purposeful role in that region is particularly important in light of the tumultuous events taking place in Iran. Since the end of the Second World War, the United States has maintained a close relationship with Iran and it has a vital interest in Iran's independence and integrity. The people of Iran should shape their own future without foreign interference. That is the policy of the government of the United States and we expect it to be the policy of all of Iran's neighbors. Africa Congressional support for peace, stability, and orderly change are essential in other tense regions, as well. In Southern Africa we are trying to help bring about a peaceful transformation to majority rule which will avoid growing bloodshed between white and black and deeper intervention by the Soviet Union and Cuba. Together with our European allies, Canada, and African states directly concerned, we are making progress toward the independence and majority rule of Namibia—a step that would have a positive impact on the evolution of events in Rhodesia and elsewhere in Southern Africa. We are heartened by the support of the African leaders who have worked with us in efforts to resolve the Namibian and Rhodesian issues. Congressional repeal of the Byrd Amendment was essential in enhancing our credibility in the effort to avoid a gathering war and further Soviet and Cuban gains in Southern Africa. We will consult closely with the Congress during the coming months, as we seek the most constructive role we can play. It will be increasingly important to maintain our position of impartiality among the parties so we can help them resolve their differences should they choose the path of peace. Latin America In our own Hemisphere, we can point with pride to the cooperative spirit which enabled us to change, in mutually beneficial ways, the basis of our relations with Panama. Senate approval of the two Panama Canal treaties last year has improved the quality of our historic relationship not only with Panama itself but with our friends in every part of Latin America. By that act, our country helped demonstrate its ability both to protect major security interests and to deal with smaller nations with dignity and mutual respect. Congressional action to pass the necessary implementing legislation for these treaties before the October 1 deadline will ensure that the Canal is efficiently operated during the transition to a new partnership with Panama. The treaties and implementing legislation, like our efforts to help the people of Nicaragua find an enduring democratic solution to the current crisis there, are important to the future stability of Central America as a whole and the strengthening of our new and mature relationship with the nations of all Latin America. The International Economy In our daily lives, we are constantly reminded of the importance of a healthy world economy to the strength of our own. We see this in the wages of our workers who produce goods for export, in the choice of goods for our consumers, in the price of energy. We must work closely with other countries to ensure that the world economy can steadily develop through non-inflationary growth, while together we manage the use of its resources and protect our environment. The focus for much of this effort during the past year was the Bonn Economic Summit. We worked out a strategy of cooperation with our partners to improve the world economic situation: within the framework of those Summit decisions, West Germany and Japan have taken measures to stimulate their economies while we are giving top priority to fighting inflation. Our actions, along with those taken by other Summit participants, are leading to a convergence of economic policies that will strengthen the global economy. We have strengthened the dollar by working out arrangements with other countries to counter speculative disorder in currency markets. Since I announced my dollar stabilization measures last November, we stopped the dollar's decline in value against other currencies and have actually increased the dollar's value by around 10 percent against several major currencies. Moreover, we have announced a multi-faceted program to increase U.S. exports, which will benefit American farmers and workers, while further strengthening the position of the dollar. We are now close to new agreements with our trading partners to establish a fairer, better operating and more open framework for world trade. The American people have a vital stake in Congressional approval of these agreements. Ten million American jobs depend on our exports. Every third acre of our farmland produces for sales abroad. Twothirds of our imports are essential raw materials or goods we cannot readily produce. At a time of difficult strains in our own economy, there is always an impulse to abandon our commitment to an open world trading system. But the costs of such a course to the American people would be enormous. Each American family would pay more for what it buys and would have less choice in the goods available. Inflation would be fueled. Jobs would be jeopardized, for protectionism against our trading partners breeds protectionism by them against us. I am convinced that our economy can adapt to changing patterns of world trade in ways that protect the future of our workers. We can compete effectively in the world economy. The new trade agreements give us the opportunity to do so. Our programs of economic development assistance abroad are also an investment in our own future as well as the future of other nations. Our most rapidly growing markets lie in the developing world. By helping the people of these countries, we not only help extend their opportunities for a better life, we help ourselves. By demonstrating to their governments that we are concerned for the well-being of their people, we encourage their increasing cooperation with the West on a broad range of issues. I therefore urge Congressional approval of the funding we propose for our bilateral assistance programs and our participation in the work of the multilateral development banks and UN agencies. My proposal to establish a Foundation of International Technological Cooperation reflects our recognition that scientists in many developing nations are ready to work in collaboration with our technological institutions to solve the great problems of health, nutrition, productivity and other aspects of economic development. Key commodity agreements can also help us deal with the legitimate needs and interests of the developing countries. Senate ratification of the International Sugar Agreement, which we signed last year, along with price support legislation will stabilize prices for that important commodity. We have pledged a contribution to the International Tin Agreement, and we will conduct negotiations on a rubber accord. Efforts to build a stronger international economy are directed not simply at managing economic relationships among nations, but at improving the lives of individual people around the world. For it is the lives of individuals which define the success or failure of our foreign policies. REASSERTING AMERICA'S VALUES America's future is best secured in a world founded on decency, justice and compassion. The effort to make human rights a central component of our foreign policy comes from our deepest sense of ourselves as a humane and freedom-loving people. We do not make our standards the precondition for every relationship we have with other countries; yet human rights can never be far from the focus of our thinking or we violate our own best values. In the year just passed, some have quarrelled with the timing or the tactics of our emphasis on human rights abroad. Others have pointed to our own imperfect record on human rights at home. Yet few can dispute an important fact of this experience: our concern for human rights has met with great resonance in the world at large. The very term has entered the language and become imbued with an everyday familiarity that was simply unknown little more than two years ago. We believe our efforts have contributed to a global awakening: • thousands of political prisoners have been freed; • in several countries, torture of prisoners has been significantly reduced or eliminated and trials are more often open to the public; • open advocacy of human rights has occurred in nations where the concept was heretofore forbidden; • international organizations such as the UN and the OAS now have vigorous human rights commissions for the investigation and airing of human rights violations and the Commission on Security and Cooperation in Europe has helped to make human rights an institutionalized part of the international agenda on both sides of the Atlantic; • in a number of key nations around the world, democratic institutions are being strengthened as democratic values are reasserted. Americans can be proud of the leading role their government has played in advancing this process. I now ask the Congress to take action in 1979 which will further strengthen our human rights record. I have signed four important human rights treaties, including the Convention on Racial Discrimination, the International UN Covenants on Economic and Social Rights, and on Political and Civil Rights, and the Inter-American Convention on Human Rights. Senate ratification of these treaties will firmly align our Nation with the growing forces for rule of law and human dignity in this world. Similarly, I call upon the Senate finally to ratify the Genocide Convention. The United States is one of the very few countries which have not yet ratified this convention; this anomaly should be corrected at the earliest possible moment in this Congress. I am also proud of the efforts we have undertaken this past year to alleviate the plight of refugees from the far corners of the world, particularly those fleeing the troubled Indochinese peninsula. We have done a great deal to reduce suffering among these desperate people and to provide many of them with a possibility of a new home and a new start. We will continue to do our part and to encourage others to increase their financial assistance and opportunities for resettlement. I hope to cooperate closely with this Congress in the passage of new legislation which will allow us to focus U.S. assistance more efficiently in working toward the solution of this global, human problem. Our challenges reflect a single fact: the pressure of accelerating change in our century. We need not fear this phenomenon; indeed, we should welcome it. Change has not been merely a challenge in American history; to a very real degree, it has been our Nation's charter. We have not prospered and grown for more than two hundred years by worshipping the status quo. In building our Nation and confronting the many tasks which history has assigned us, we have found change to be our natural element. We should approach the task of building a new Foundation for a world of change with the confidence of a Nation whose strengths are unmatched. Our military forces are strong and growing stronger. Our technological and industrial capacities are unsurpassed. Our allies are strong and reliable. Our way of life, and what we stand for as a Nation, continue to have magnetic international appeal. I do not pretend that change comes without cost. I do not pretend that it comes without pain. Neither the visionary men of the 18th Century who founded our Republic, nor the citizens of conscience who opposed slavery in the 19th, nor the men and women of the 20th who led us successfully through two world wars looked upon change as easy. They did, however, look upon it as inevitable. So it was in the beginning of our country, so it has been through all the stages of our history. The future has always brought Americans to a higher level of national achievement as long as we were willing to invest the time and the energy and the imagination toward shaping that future ourselves. As we begin a new year, I repledge my Administration to time, energy, and imagination essential to build a new Foundation for a world of peace, prosperity and human justice. Together, America's Congress, its people, and its President cannot only master the many challenges of change, but make them a part of our Nation's purpose in the world. In so doing, we can bring America closer to that "more perfect union" of Jefferson's dream in a wider and more secure global community congenial to our values, interests and ideals. JIMMY CARTER. 
The White House, 
January 25, 1979.
My State of the Union Address was devoted to what I believe are the highest priorities facing our Nation in 1979 as we seek to build a new foundation at home and abroad. However, my Administration's time and effort this year will also be focused on a significant number of other important initiatives and goals. I am sending this State of the Union Message so that the Members of the 96th Congress are presented with a full picture of my basic legislative program in domestic and foreign affairs for the year. Over the past two years, my Administration has developed a very cooperative relationship with the Congress. That relationship not only resulted in the extraordinarily productive record of the 95th Congress, but will provide the foundation for a renewed sense of trust and confidence by the American people in their government. We have an enviable record to match. But with your help, the 96th Congress can meet this challenge. My Administration and I are eager to help in the effort. Our basic goals will be to continue working with you to build solid foundations for the next century—a solid economic foundation of stable prices and continued growth—a solid foundation for a more efficient, less intrusive Federal government—a solid foundation for world peace and American security. FOUNDATION FOR PROGRESS When I took office two years ago, the country faced serious domestic problems: • the economy had not recovered from a recession; • unemployment was intolerably high at 7.8%, with 7 3/4 million Americans out of work; • the Nation had no sound energy policy and oil imports were rising rapidly; • the Federal government was operating inefficiently in numerous vital areas; • trust in the openness and integrity of the government was low; • major social problems were being ignored or inadequately addressed by the Federal government. In the ensuing two years, we have tackled these problems head-on. While problems cannot be solved overnight, real progress has been made: • the economy has strengthened—real Gross National Product has increased 10% and real disposable personal income has increased 8.9%; • the unemployment rate has decreased by 25% since my election, from nearly 8% to 5.9%; 7.3 million new jobs have been created; total employment has reached a record of 95.9 million; • a comprehensive national energy, policy has been enacted and a Department of Energy created to help implement it; • the first major reform of Civil Service System in nearly a century was enacted; 6 reorganization plans have been approved and implemented; the Federal paperwork burden has been reduced by 10%; inspectors general are being placed in departments and agencies to help root out fraud and abuse; zero-based budgeting practices have been instituted throughout the government; several hundred million dollars have been saved through sound cash management reforms; regulations are being written in simple English, and a Regulatory Council has been established to develop the Nation's first regulatory calendar and agenda; • a renewed sense of confidence and faith in the government is gradually being restored; • long-ignored domestic problems have been attacked aggressively: the Nation's first urban policy was developed and its implementation begun; the Social Security System was refinanced to assure its long run solvency; the Humphrey-Hawkins Full Employment Act was passed; aid to education has been expanded by 50%; and a welfare reform program was developed and debated in Congress and will serve as a foundation for our efforts this year to overhaul the welfare system; • cumbersome regulatory apparatus which deters competition in our economy was dismantled by the deregulation of the airline industry. DOMESTIC POLICY PRIORITIES Over the next year, our domestic program will concentrate on further developing a new foundation for progress in each of several areas: • restraining inflation, while continuing to pursue our employment and other economic and budgetary goals; • making government more efficient and effective; • enhancing basic human and social needs; • protecting and enhancing our rights and liberties; and • preserving and developing our natural resources. INFLATION My Administration's major domestic priority is to reduce the rate of inflation, while maintaining economic growth. That is clearly the major domestic concern of the American people, and it is the problem they are looking to us to help solve. Inflation places a cruel burden on the poor and on those on fixed incomes. It serves as a disincentive to investment. It threatens our continued economic growth and job creation. This is more than an economic challenge. Inflation is the persistent, historic enemy of a free society. It saps our confidence and faith in the future. It undermines our trust. I am determined to meet the challenge now before us. Last October I announced an anti-inflation program which can aid significantly in the effort to reduce inflation. It is a tough and responsible voluntary program. Throughout this year, we will be working to implement our anti-inflation program. Part of the program requires new legislation, and we intend to work closely with you in developing and enacting that legislation. The effort to reduce inflation will be one of the most difficult battles our government has undertaken in many years. But it is not a battle we can afford to lose. Government cannot solve the problem of inflation alone. But we can and must lead the way. With your cooperation, we can and will win. The 1980 Budget In announcing my anti-inflation program last year, I made a commitment to the American people to reduce the budget deficit for fiscal year 1980 to $30 billion or less. The budget I submitted to the Congress honors that commitment. The FY '80 budget projects a deficit of $29 billion, which is less than half the deficit the Nation had when I ran for office and represents the smallest budget deficit in the last six fiscal years. The FY '80 budget has $531.6 billion in projected budget outlays, which is an increase of only 7.7% above the previous year. That is the smallest annual increase in Federal spending in the last seven years. The $531.6 billion spending total also means that we will be meeting my goal of reducing Federal spending to about 21% of Gross National Product one year ahead of schedule. The decisions I had to make in restraining spending were difficult. But if we are to succeed in breaking the back of inflation, Federal spending must be restrained to set an example for the private sector. If there were easier solutions, they would have been taken by now. Finally, I want to emphasize that my FY '80 budget does not neglect the basic needs of the disadvantaged, the poor, and the unemployed. For instance, the budget will provide $4.5 billion in increased assistance to the poor. It also will provide a total of $11.2 billion for adult and youth employment and training programs, which will be especially targeted to the disadvantaged and long-term unemployed. Moreover there are significant increases for education programs for the disadvantaged and a new fiscal assistance program for our Nation's cities. In short, this budget is austere, but it also maintains our commitment to help those in our country who most need it. Hospital Cost Containment One of my highest legislative priorities for this year is hospital cost containment. It will be one of the clearest tests of the seriousness of the Congress in dealing with the problem of inflation. Clearly the most inflationary part of health care costs in recent years has been in the hospital industry. Last year, hospital charges grew at the rate of about 13 percent. Experience in several States has shown that through programs such as the one I will propose, hospitals can save money and reduce costs through sound cost containment practices. I expect to shortly propose hospital cost containment legislation which will build on the proposal passed last year by the Senate. Real Wage Insurance I have proposed to the Congress a real wage insurance program to protect employee groups that comply with the 7% voluntary wage standard against losses in purchasing power if inflation exceeds 7%. If inflation exceeds 7%, these employees will receive a tax refund equal to their 1979 income up to $20,000 times the difference between the actual inflation rate (up to 10%) and 7%. This program will give workers a strong economic incentive to cooperate with the voluntary pay standards I have established, thereby helping to break the wage/price spiral that is at the root of the current persistent inflation. This is a novel approach to the inflation problem. The persistence of high inflation for the past ten years makes clear that new solutions are needed. Innovative approaches must be added to the arsenal if we are to break the back of inflation. Real wage insurance represents the type of innovative approach which is required: it will provide a significant tax benefit for those working people who participate in helping to reduce the inflationary cycle, but without raising taxes for anyone else. My administration intends to work very closely with Congress in developing and enacting a real wage insurance law. Voluntary Pay and Price Standards It is vital that our program of voluntary pay-price standards succeed. At stake is the reduced rate of inflation that all Americans demand and deserve. The cooperation of business and labor is obviously essential, and we have already had clear evidence of their willingness to join in this effort. I have already received assurance from over 200 of the Nation's largest corporations that they will comply with the standards. And just recently the Oil, Chemical, and Atomic Workers Union reached agreement on a contract with the major refineries that met the pay standards. Throughout this year the pay and price standards will continually be tested. Your cooperation in encouraging voluntary compliance can help ensure the standards' success. The Administration will keep the Congress fully informed and involved as we work to implement this program. State and Local Governments If we are to succeed in our anti-inflation efforts, the cooperation and active participation of State and local governments is essential. We will soon announce a program which actively involves the Governors, Mayors, County Executives, and other local officials in a comprehensive approach to restrain inflationary pressures within their control. The Necessities In recent years, the greatest inflationary burden on the working men and women has involved necessities of life food, energy, housing, and medical care. An effective anti-inflation program must involve a series of concerted attacks on the sources of rising prices in these vital sectors. In each of these areas, the Administration has established task forces to identify existing government policies that unreasonably inflate prices, and to suggest actions that can be taken, at both national and local levels, to combat inflation. In these efforts we will work directly with Congress, State and local governments, and consumer groups. Multilateral Trade Negotiations ( MTN) I have already notified the Congress that we expect to sign and submit for Congressional approval a set of trade agreements which we will reach in the Tokyo Round of the Multilateral Trade Negotiations. With these agreements, we expect to achieve major reductions in tariff and nontariff barriers to international trade. These agreements will: —lead to increased opportunities for YOU.S. exports; —ensure that import competition is fair; and —result in lower prices, increased competition, and greater prosperity for the American people. Passage of the MTN will be one of my highest legislative priorities this year. It is critical to the health of our domestic and of the world economy. Countervailing Duties I have recently sent to the Congress a message urging prompt passage of legislation permitting the waiver of the imposition of countervailing duties on certain imported products. Passage is essential to the successful completion of the Multilateral Trade Negotiations, and therefore, should be one of Congress' highest priorities at the beginning of this session. Exports The United States has entered a period where export growth is essential to improve our balance of payments, strengthen the dollar, and thereby help reduce inflationary pressures. To do this, both the private sector and the Federal government must place a higher priority on exports. With the National Export Policy I announced last year, we are moving to meet this need. First, we are working to reduce domestic barriers to exports so that exporters are not stifled by excessive governmental regulation. Second, we are providing further incentives in the form of better export financing and better government export development programs. Third, we are working with our trading partners in the Multilateral Trade Negotiations to reduce foreign barriers to our exports and to secure a fairer international trading system for all exporters. These actions should expand our exports in 1979 and help us move toward a reduced trade deficit, although they will not cure our serious balance of trade difficulties overnight. They are the first steps in an essential, long-term effort to strengthen the YOU.S. position in world trade, while reaffirming the Nation's commitment to maintain an open world trading system and to resist protectionism. Council on Wage and Price Stability The Council on Wage and Price Stability is playing a vital role in our anti-inflation efforts. The Council and its staff have the lead responsibility within the Executive Branch for implementing the voluntary wage and price standards that I have announced. Without the Council's continuing role, the anti-inflation effort would have a very slim chance of succeeding. I therefore believe it is essential that the Council, along with its staff operation, be reauthorized early this year with the additional staff I will request to handle the enormous volume of work under my anti-inflation program. The reauthorization should not contain amendments that interrupt or restrain the necessary work of the Council or its staff. EMPLOYMENT The Administration, working closely with Congress, has made significant progress over the last two years in reducing unemployment and creating new jobs: • The December unemployment rate of 5.9% represents almost a 25% reduction from the December, 1976 rate. • 7.3 million more people have jobs than they did before the beginning of the Administration. This increase exceeds the employment growth in any other two-year period since World War II. • Total employment has reached an all-time high of 95.9 million. • Over the past two years black employment is up by 12%; and black teenage employment is up by 19.7%; adult female employment has increased by 10.5%; teenage employment overall has increased by 11%. Although progress has been made, unemployment remains unacceptably high for these groups. And in inner-city areas unemployment remains much too high for all workers. Last year, which ended with the lowest unemployment rate in 3 years, a framework for continued progress into the next decade was established: • the Comprehensive Employment and Training Act (CETA) was reauthorized at high levels for four more years; • the Humphrey-Hawkins Full Employment Act became law after many years of effort; • the Administration's demonstration youth programs were extended for two more years; • a new partnership between the government and the private sector to assist the unemployed was approved by Congress with the passage of a new Title 7 of CETA—the Private Sector Initiatives Program; the targeted jobs tax credit, to encourage private employees to hire our poor young people and others who are hard to employ; and an expanded tax credit for mothers on welfare. In 1979 this framework will help us continue to improve the employment prospects for America's workers. We especially want to improve the targeting of job creation programs to those who most need these opportunities and to improve the quality of the training and employment assistance for the poor, blacks, Hispanics, youth and women. We expect to achieve these goals through a number of actions: First, we will continue working toward achievement of the Humphrey-Hawkins Full Employment Act goals. We will provide an average of 546,000 CETA public jobs, and shift many of them to the longterm or "structurally" unemployed. We will continue to search for the most promising ways to reduce the structural unemployment that denies many the opportunity for full participation in American life. Second, we will begin implementing the new Private Sector programs, including establishment of Private Industry Councils in communities throughout the country, to encourage business to hire the hard-core unemployed. I am proposing to Congress that this effort be supported at a level of $400 million this year. Third, we will continue our special efforts to provide jobs and training programs for young workers in cooperation with community-based organizations and the private sector. We must meet our responsibility to provide opportunities for young Americans to learn to work. Fourth, we will take steps to improve the management and delivery of employment and training services. I will seek a reform of the Wagner-Peyser Act, which authorizes the YOU.S. Employment Service, to integrate that program more effectively into our employment and training system. My Administration will also implement the CETA amendments, which establish practices and procedures to improve the quality of programs, provide better management and prevent fraud and abuse. MAKING GOVERNMENT MORE EFFICIENT AND EFFECTIVE The American people are demanding a Federal government which is effective and efficient. For the past two years, I have worked toward that goal by reorganizing and reforming the government's operation and by uncovering and removing fraud, waste and abuse. Real progress has been made. But the government is still not operating as competently as I want or the American people deserve. In 1979, we must build on the base of the last two years to provide our people with the type of government they deserve. Your help in this effort is essential. We have already begun to build a new foundation of government efficiency and we will do more in the year ahead. Reorganization We have begun to reorganize the government through the creation of a Cabinet-level Department of Energy and the changes resulting from the six reorganization plans approved by Congress over the past two years. Those plans helped to reshape and improve the operation of the Executive Office of the President, the international cultural and communications agencies, emergency preparedness agencies, the equal employment opportunity enforcement agencies, the Civil Service Commission, and the administration of the Employee Retirement Income Security Act. I will again propose to the Congress that a Cabinet-level Department of Education be created. This will be a very high priority of this Administration. Education issues deserve far more attention and more accountable management than they can receive in a department as large and complex as HEW. The department would provide a Cabinet-level official devoting full-time attention to education and reporting directly to me. It will also enable the Federal government to be a more responsive and reliable partner with States, localities, and private institutions which have primary responsibility for education. I will also be proposing to Congress reorganization plans involving economic development and the management of our natural resources development, and will intensively study possible reorganizations in the areas of surface transportation, the Selective Service system and the Alaska natural gas pipeline. The natural resources and economic development reorganizations involve areas where overlap, duplication and unclear authority have hamstrung our efforts. Reorganization here can save money and people. We will be consulting closely with Congress over the next several weeks before submitting these reorganization plans. Regulatory Reform Last year we took major steps toward reform of the Federal regulatory system, ranging from improved regulation writing to saving hundreds of millions of dollars through improved cash management techniques. The dramatic reductions in airline prices that occurred when Congress joined with us to lift the heavy hand of Federal regulation illustrate the advantages of letting the competitive market, rather than government, control industry performance. The public will benefit similarly through improved service, increased competition, and lower Federal expenditures, if we reform Federal regulation of surface transportation. I will send to Congress shortly a Surface Transportation Reform Message dealing with the rail, inter-city bus, and trucking industries. In 1978 I used my authority as Chief Executive to improve the management of the Federal regulatory process. I issued Executive Order 12044, setting standards to ensure that each Executive Branch regulatory agency facilitates public, participation and avoids needless costs. A regulatory analysis program was established under an inter-agency Regulatory Analysis Review Group to help ensure that major new regulations are as cost-effective as possible. The Executive Order also established procedures for all Executive Branch agencies to conduct sunset reviews to reevaluate outdated regulations and remove them from the books wherever warranted. Finally, I created a Regulatory Council composed of the Executive Branch regulatory agencies, with voluntary participation by independent agencies, to develop a calendar of all major Federal regulations to be issued or proposed in 1979. The Nation's first Regulatory Calendar will be published next month and will be used to eliminate duplication, overlap, and inconsistent practices. This year I will propose to Congress a number of legislative actions that can be taken to improve the regulatory process. They will include improvements in specific regulatory programs, as well as a Regulatory Reform Act so that no regulation can be issued unless it is genuinely required, and unless it gets the job done with maximum efficiency and minimum paperwork, costs, and other burdens. The quality of regulations can also be improved by providing opportunities for all interested parties to participate in regulatory proceedings. Public involvement should be enhanced by providing financial assistance to those whose participation is limited by their economic circumstances. While many agencies have inherent authority to fund participation, we will seek legislation to specifically authorize these programs. While I will propose a wide-ranging legislative program, I will continue to oppose the legislative veto. This approach is unconstitutional; it increases uncertainty and delay; and it deflects attention from the real solutions. None of our actions in this area will be taken at the expense of my deep personal commitment to protect health and safety in the environment, the workplace, the highway, and consumer products; and to prevent deception and unfairness to consumers. My regulatory reform program will help make needed programs work better, cost less, and gain support among all sectors of our society. Civil Service and Pay Reform Enactment of the Civil Service Reform Act of 1978 by the 95th Congress represented one of the finest examples of cooperation between the Legislative and Executive Branches in recent times. That effort showed a determination to respond to the clear public desire to improve the management of the Federal bureaucracy. Implementation of the Reform Act is well under way. The Office of Personnel Management, the Merit System Protection Board, and the Federal Labor Relations Authority authorized by the Act have been established. In addition, the heads of the Federal departments and agencies have moved promptly to implement the new personnel procedures that will permit a better motivated and more effective civil service. However, other improvements in management of the government's work force are needed. Our white collar, blue collar, and military systems must be reformed in order to make certain that we neither overpay nor underpay Federal employees. Therefore, I will propose Federal pay reform legislation covering each of these systems to the Congress that is equitable to Federal employees and the public. These pay reforms are an important follow-on to our civil service reform. Public Financing The time is long overdue for reforming the way Congressional elections are financed. The current flood of money threatens to pervert our electoral process. We can no longer permit our elections to be open to the highest bidder. The recent elections have clearly demonstrated the kinds of problems caused by uncontrolled campaign spending. It is time to adopt public financing for Congressional elections-before it is too late. Public financing operated successfully in the last Presidential election, and it can do the same in Congressional races. My Administration will work with Congress for passage of a sound Congressional public financing law. Sunset My Administration will again work with the Congress to enact a sound sunset bill. Under such a bill, each Federal program would have to be carefully re-examined on a periodic basis to determine whether its continued existence is justified. Through such a procedure, the American people can be assured that unnecessary government programs and agencies will be ended, rather than continued through the force of inertia; and other programs and agencies will be improved. There are few more important building-stones to the new foundation of government efficiency we seek than passage of sunset legislation. It goes to the heart of making government work. Lobby Reform The American people have a right to know what significant influences affect their national legislature. The proliferation of well financed, organizational lobbying activities during recent years has demonstrated the clear need for reform of the outdated and ineffective lobby disclosure law now in effect. This year my Administration will continue to work with Congress to pass a sound lobby law reform bill—one that respects the First Amendment right of all Americans and minimizes paperwork burdens, yet allows meaningful disclosures. Waste, Fraud, and Inefficiency Although the vast majority of Federal employees are able, honest and hardworking, we need to continue to be vigilant to ensure that the taxpayers' dollars are not wasted through fraud or abuse. The implementation of civil service reform will lead to improvements in agency management practices and program efficiency. In addition, I am committed to continuing to cut excess paperwork, simplify grants requirements, and evaluate our programs better and more frequently. We have already significantly reduced the paperwork burden and implemented many of the recommendations of the Federal Paperwork Commission. We will continue to do more in 1979. Early this year I will nominate highly qualified Inspectors General armed with tough new powers to prevent waste and corruption. The Justice Department will increase its already intensive effort to prosecute those few employees and contractors who abuse the public trust. In addition, a new Office of Ethics in the Office of Personnel Management and a Special Counsel in the Merit System Protection Board will help ensure the integrity of the Federal work force and protect its members from political abuse. State and Local Government Relations As the first President in more than thirty years to be elected immediately after service as a Governor, I have made relations with State and local government a high priority of my Administration. During my first two years in office, we have strengthened the Federal system significantly. We have involved the Federal Regional Directors in the management of the government and have reinvigorated the Federal Regional Councils. As a result, the Federal government is now able to respond better and more quickly to State and local needs. In addition, we have involved State and local officials in the development of our policies to a greater degree than any previous Administration. Since 1977, Federal grants-in-aid to State and local governments have increased to more than $80 billion per year, 25 percent above the level of aid when I first took office. Progress has also been made towards my goal of giving Governors, Mayors, and county officials more flexibility in managing Federal programs. The Federal government is now taking seriously, for the first time, the burdens and costs we impose on State and local governments and all taxpayers when we legislate and regulate from the Federal level. In this time of limited budget resources we must achieve more cost-effective management of Federal resources and place greater reliance on the experience, knowledge, and ability of State and local governments. In the future, we must attempt to limit the imposition of new costs on State and local governments, and to avoid where possible prescribing every detail of how they administer Federal programs. We must work together to identify specific ways in which more flexibility can be given to State, city, and county officials in the administration of Federal programs without compromising the national purposes that each program is designed to serve. Transportation In 1979 we shall continue the effort begun in the 95th Congress to reduce the regulatory burden on the Nation's transportation industry. Our proposals for surface transportation deregulation will build upon the principles of increased competition that have proven successful for the airline industry. Shortly, I will propose broad legislation which begins to deregulate the railroad industry. Regulatory reform is a crucial first step toward revitalizing this important transportation mode. In addition, I will also be proposing significant reductions in the regulation of inter-city bus transportation and certain regulatory changes in the trucking area. We are also committed to improving the level of safety for our transportation industry. As part of this effort, we intend vigorously to pursue legislation improving equipment and conditions affecting truck drivers, and giving stronger enforcement authority to Federal agencies. My forthcoming Surface Transportation Regulatory Reform Message will provide the details of these proposals. Finally, I will propose overdue changes in the Nation's maritime policies. We must improve the ability of our Merchant Marine to win a fair share of our cargo. No-Fault The Administration will continue to support legislation to establish Federal minimum standards for state no-fault automobile compensation systems. No-fault systems have proven to be far more efficient in delivering benefits to the victims of automobile accidents than the current tort system, and they also provide greater opportunities to coordinate and reduce overall insurance costs. Too great a percentage of the premiums paid by policy-holders goes for the administration of the current wasteful tort liability system. No-fault would save money and court-time. It deserves Congressional support. Consumer Representation My Administration has developed new procedures that will set standards and assess performance for effective public representation within government agencies. These procedures are designed not only to improve the delivery of government services to our citizens, but also to enhance the awareness of government to the health, safety, and economic concerns of all consumers. In 1979, we will direct adequate resources to these procedures, which include complaint handling, training and technical assistance for consumer organizations, advocacy, consumer education and information, and citizen participation. LEAA Last year I proposed legislation which would institute significant and long-overdue changes in the structure and programs of the Law Enforcement Assistance Administration. The LEAA has the potential to improve and strengthen State and local law criminal justice programs, but in its present form it has fallen far short of its potential. My Administration will work with the Congress again this year to reform this framework, which includes a National Institute of Justice to enable us to obtain better information and research about crime problems. Once the legislation is enacted, we will make certain that the new agency is efficiently carrying out its mission of providing meaningful Federal law enforcement assistance. Judgeships Last year my Administration worked closely with the Congress to enact legislation creating the additional Federal judgeships needed to reduce our court's backlogs and delays. As a result, I will soon be nominating 152 new Federal judges—the largest addition to the Federal judiciary in our history. Some of these judges will still be serving in the next century. I am determined to nominate judges of the highest quality; our Federal judiciary must be selected on the basis of merit. I am also determined to increase the low representation on the Federal bench of women, blacks, Hispanics, and other minorities. These goals are within our reach, if we work together cooperatively and recognize the importance our country places in the selection of these new judges. Judicial Reform Because our Federal courts do not function as well as we have the right to expect, my Administration has made judicial reform one of its goals. During 1978, Congress took major steps toward alleviating the problem by increasing substantially the number of Federal judges and by adopting numerous substantive and procedural reforms in the handling of bankruptcy matters. Other judicial reforms remain to be made. Some, such as expanding the authority of magistrates and curtailing diversity jurisdiction, were proposed to the last Congress. I will shortly send a message to the Congress urging prompt action on these and several additional proposals designed to improve the responsiveness and efficiency of our system of justice. They merit the attention and approval of the Congress. In addition, as was indicated in my Consumer Message to Congress, the Administration will continue to support reform of class action procedures. Reform legislation should seek to ease unnecessary burdens and costs of class actions, while at the same time preventing them from being used in a harassing manner. Antitrust Enforcement and Competition Free enterprise and competition, protected by the antitrust laws, are the central organizing principles of our economic system. Competition produces powerful incentives for innovation and efficiency, fights inflation, and enhances consumer welfare. Strict enforcement of our antitrust laws are critical to the health of competition and the Nation's economy. Several important strides were made last year in improving antitrust enforcement. In 1978, the courts imposed over $11 million in corporate fines for antitrust violations and imprisoned 29 individuals for antitrust violations. These fines and sentences are significantly larger than in past years, and are consistent with my strong commitment to vigorous antitrust enforcement. Last year I appointed the National Commission for the Review of Antitrust Laws and Procedures to suggest ways of expediting antitrust cases and making relief more effective. Its members have recently reported to me, and we will work closely with the Congress and the Judicial Conference to implement many of its recommendations. Similar progress in improving the effectiveness of antitrust enforcement can be made in the 96th Congress. I continue to support legislation to allow those who are injured by antitrust violations to recover damages from the antitrust violator, whether the injured person is a direct or indirect purchaser. Under the Supreme Court's decision in the Illinois Brick Case only direct purchasers may recover, even though they may have passed on the injury to consumers, who are prevented from suing. This decision undercuts state and private enforcement of the antitrust laws, reduces their deterrent effect, may contribute to higher prices, and often allows the violator to keep his gain at the expense of the injured consumer. This needed legislation would overturn that decision. Banking I anticipate receiving shortly the recommendations of the Administration's Task Force studying Regulation Q and the system of deposit interest rate controls, and I expect to make recommendations based upon the Task Force's findings. My Administration remains supportive of Congressional action to deal with the need to halt the continuing attrition in the percentage of bank deposits subject to the reserve requirements of the Federal Reserve System. Carryover Basis Carryover basis was one of the most important reforms passed by Congress in the Tax Reform Act of 1976. This reform would add substantial equity to our tax laws and greater efficiency to our capital markets. The carryover basis reform has the effect of ending a situation in which many of our wealthiest taxpayers could permanently escape paying income tax on their gains from inherited property. Unfortunately, the effective date has been delayed until the end of 1979. My Administration will strongly oppose any efforts to repeal this reform or further delay its implementation. ENHANCING BASIC HUMAN AND SOCIAL NEEDS In the years immediately preceding my Administration, too many of our Nation's basic human and social needs were being ignored or handled insensitively by the Federal government. Over the past two years, we have significantly increased funding for many of the vital programs in these areas; developed new programs where needs were unaddressed; targeted Federal support to those individuals and areas most in need of our assistance; and removed barriers that unnecessarily kept many disadvantaged citizens from obtaining aid for their most basic needs. The progress over the past two years has noticeably moved us forward toward building a new foundation to solve some of the country's fundamental human and social problems. My Administration has vastly expanded assistance in the last twenty-four months in areas of employment, education, housing, community and economic development and health care, which represent an improvement for the American people. The record of the past two years demonstrates that government can meet our citizens' basic human and social needs in a compassionate way. No longer can there be any doubt that the government is able to treat Americans' problems with sensitivity. In the coming fiscal year, budget restraints make it more difficult to expand funding significantly for many major domestic programs, though some programs will be increased. We will continue to make existing social programs work more effectively; to reduce the waste and fraud and excess bureaucracy which drains tax dollars intended to meet basic human needs. In a period of austerity, efficiency is itself an act of compassion because it unlocks resources needed for health care, education, housing, economic development and other urgent social priorities. Health Program One of the highest goals of the 96th Congress should be taking action to provide all Americans with the opportunity to lead a more healthy life. This opportunity has been denied to many in our country because of health care services which are unaffordable, inaccessible, and inefficient. In addition, our current system of health care is focused on the treatment of disease, with too little attention being directed toward its prevention. We need a national health strategy which corrects these inadequacies in the existing system. Some of the elements of this strategy are already in place and need only be strengthened. Others will require new legislation from the 96th Congress. National Health Plan and Other Improvements Last year I outlined the principles upon which the National Health Plan I intend to propose will be based. Based on those principles, the Administration has been working to develop a National Health Plan that will enable the country to reach the goal of comprehensive, universal health care coverage. I remain committed to that goal. The need for improved health care coverage is clear: • About 19 million Americans have no health insurance. • Another 65 million Americans face potential bankruptcy because they lack insurance protecting them against catastrophic medical expenses. • The health care system is highly inflationary. Spending in the entire health care industry—has been rising at an annual rate of 12%. These expenditures cannot be successfully contained under current health delivery and financing methods, which produce unnecessary hospitalization, over-reliance on expensive technology and inadequate preventive care. • Health resources are unevenly distributed across the country, resulting in significant gaps in vital medical services for many residents of rural and inner city areas. Over the next several weeks, we will be consulting closely with Congress and interested outside groups on the scope and nature of the plan I will propose. I expect to submit a plan later in the year shortly after those consultations have been completed, and I look forward to working with the Congress toward a prompt enactment of that plan. An essential companion to any plan must be hospital cost containment legislation. As I have indicated earlier in this Message, I will make passage of that legislation one of my highest priorities this year. Our effort to control health care costs would be further strengthened by the early passage of the Health Planning Act. We must also continue to promote competition in the health care sector of the economy. Accordingly, the FY '80 budget expands Federal support for Health Maintenance Organizations, which have demonstrated a significant potential for cost saving. I will also continue to press for reforms making it easier for HMO's to obtain equitable reimbursement under Medicare and Medicaid. Prevention and Accessible Health Services More health care services alone, however, will not necessarily improve the health status of our Nation—even if these services are affordable, accessible, and efficient. Our national health .strategy must direct more attention to health promotion and disease prevention if we are to achieve our goal of improved health status. The Surgeon General will present this year a major report outlining our needs in this area. I will be asking for your help in carrying out many of its recommendations. We have made great strides in expanding the availability of health care services to rural and low-income urban areas in recent years through the creation of the National Health Service Corps and the establishment of a system of Community Health Centers. If health care is to be accessible to all Americans, these programs must be expanded, and the FY '80 budget provides for such an expansion. Child Health Assessment I believe that our health strategy must place high priority on the health of our children. Accordingly, I will submit a revised Child Health Assessment Program to improve the early and preventive screening, diagnosis, and treatment program for lower-income children under Medicaid. This program would cover over 2,000:000 low-income children who are not receiving Medicaid services. An additional 100,000 low-income pregnant women would become eligible for medical services prior to delivery, improving the health of both the mothers and infants. This should be part of a national health plan. Mental Health Based upon last year's recommendations of the President's Commission on Mental Health, I will be proposing comprehensive mental health legislation this year along with a Mental Health Message. A new Community Mental Health System will make new efforts to link mental health, health, and social services for the chronically mentally ill to enable them to live successfully in the community and will provide new community mental health services. We will emphasize efforts to provide improved recognition and treatment of mental health problems in the general health care system. In addition, we will increase support for mental health research to restore our mental health research capacity, which the Commission found had seriously eroded over the past decade. The First Lady has helped spearhead the Administration's efforts to sensitize the Nation to the problems in the mental health area. She will continue to work directly with me to implement the pertinent recommendations of the Commission. Drug Abuse In continuing our efforts to combat drug abuse, my Administration will rely on those programs and initiatives which have proven to be successful in the past year and which serve as building blocks for future programs. Today, in the United States, there are 110,000 fewer heroin addicts than there were in 1975; 1,000 fewer Americans died of heroin overdoses in the twelve-month period ending June 30, 1978 than in the previous twelve months. Seizures of illegal drugs are at their highest level ever. Improved coordination and cooperation among Federal agencies have resulted in a more effective drug program without major budget increases. But much remains to be done and the situation remains serious. In 1979 we will look more to the behavior of the individual who turns to drugs, will stress financial investigations as a means of prosecuting those individuals responsible for the drug traffic, and will rely heavily on enlisting foreign cooperation in the overall drug program. These efforts should further our success in. controlling drug abuse both in the United States and abroad. Drug Regulation Reform My Administration will continue to work with the Congress to overhaul our current drug regulation laws in order to assure that consumers have prompt access to safe and effective drugs. Food and Nutrition Last year, we worked with the Congress to enact the Child Nutrition Amendments, which revamped many of our food programs and greatly expanded the Supplemental Food Program for Women, Infants and Children. This year I will propose further legislation to strengthen these and other food programs by: improving the targeting of school meal programs for the needy; instituting an error sanction scheme to encourage States to reduce costly Food Stamp errors; and eliminating the cap on food stamp expenditures. These reforms will insure that additional nutrition resources are targeted to those truly in need. Worker Health and Safety We will continue to fully enforce laws protecting worker health and safety in a sensible and efficient manner. There will be further efforts to eliminate frivolous and unneeded rules while concentrating greater enforcement efforts on the most dangerous and particularly the most unhealthy occupational environments. More efficient management of this program will serve the interest that both labor and management have in better working conditions. Housing We are committed to holding down housing construction costs and eliminating unnecessary regulatory burdens, so that the American consumer will have an affordable choice in the housing marketplace. Our efforts will be accelerated this year. We have also supported introduction of the new money market certificates, which have helped the housing industry by maintaining a steady supply of mortgage credit. The Administration has supported the provision of Federal housing assistance to low-and-moderate income people, including the elderly and the handicapped. During the period of 1978 through 1980, the Administration will have committed resources for over one million additional units of assisted housing for low-and-moderate income renters and homeowners. This is evidence of our commitment to the goal of a decent home for every American. In 1980, I am recommending 325,000 units of housing for low-and-moderate income persons. The problems of providing adequate housing in rural areas is especially acute. Lack of available land, high site development costs, widespread substandard, overcrowded housing, and limited credit opportunities continue to plague rural areas. Government attempts to help are often hampered by inappropriate, burdensome regulations and paperwork. This year the Administration will take steps to assure that Federal regulations accommodate locally acceptable housing codes and that the endless paperwork, inspections, and processing requirements currently mandated by the three major housing agencies, HUD, FHA, and VA, are consolidated and streamlined. Community Development My Administration remains committed to a partnership involving Federal, State, county, and local governments, the private sector, and community organizations. The Community Development Block Grant program is a cornerstone of that partnership, and I am proposing in my FY '80 budget that it be funded at the full authorization level. This will be an increase of $150 million in FY '80 above the FY '79 level. In 1977, we developed the Urban Development Action Grant program and it has already succeeded in leveraging $2.9 billion in private investment and creating or saving 125,000 jobs. I am proposing a continuation of the Action Grant program next year, at the $400 million authorization level. Neighborhoods My Administration has been devoted to the preservation of neighborhoods and the development of sound neighborhood self-help projects. This goal has been evident in the emphasis on neighborhoods in my urban policy as well as in the operation of the Department of Housing and Urban Development and other agencies. Last year, as part of our urban policy, we proposed and Congress passed the Livable Cities and Neighborhood Self-Help Development programs to enable neighborhood groups and organizations to rebuild their neighborhoods. In addition, Congressional passage of the National Consumer Cooperative Bank makes available new sources of financing and technical assistance to groups who are engaged in building cooperative enterprises to reduce costs in key consumer goods and services. This year, my Administration and Congress will receive the final report of the National Commission on Neighborhoods. We look forward to working with the Congress on many of the Commission's recommendations. With your help, we can make the Federal government increasingly more responsive to the needs of neighborhood people who are working together to meet basic needs in housing and community development, health care, nutrition, and energy conservation. Urban Policy Last year, I proposed the Nation's first comprehensive urban policy. That policy involved more than one hundred improvements in existing Federal programs, four new Executive Orders and nineteen pieces of urban-oriented legislation. With Congress' cooperation, thirteen of these bills passed last year. I will again propose to the Congress several important parts of the urban policy not adopted last year. The two principal proposals are: an urban fiscal assistance program, and the National Development Bank. My fiscal assistance proposal will include two principal components. The first, a standby countercyclical fiscal assistance program, will protect State and local governments against unexpected changes in the national economy. It would trigger into place if the national unemployment rate rises above 6.5 percent and would provide fiscal aid to many needy governments. The second component is a transitional, highly targeted fiscal assistance program that provides fiscal aid to only the most fiscally-distressed local governments. Relatively few cities and counties will be eligible for this highly targeted program; but those eligible will be truly in need. I will seek a $250 million supplemental in FY '79 and $150 million in FY '80 for this targeted fiscal assistance program. I also will propose a National Development Bank to provide financing for local economic development projects which will aid the revitalization of our Nation's communities. As part of the Bank, I will propose a significant increase in economic development funding—$550 million in new economic development capital grants to business and $2.65 billion in new loan guarantee authority for FY '80. This Bank will be the central engine for the economic development in the government. We will propose the consolidation of many economic development loan programs into the Bank as part of the economic development reorganization. This will add over $1 billion in additional loan authority. Social Security Changes In 1977 the Congress worked with the Administration to take the difficult but necessary action to make the Social Security system financially sound for the next fifty years. In so doing, we helped protect the benefits of current recipients and of those now working. However, the Social Security system from time to time needs adaptation to changing conditions, so the Administration this year will make proposals which will reduce somewhat the cost of the program by trimming the costs of certain benefits. These proposals will be sent to the Social Security Advisory Council, which is representative of the contributing employers, employees and the public, and to the National Commission on Social Security, appointed in part by the Congress and in part by me, so they can have an ample opportunity to review these proposals prior to the submission of the changes to the Congress and the Administration and the Congress can have their recommendations, if any. If the Administration's proposals for Social Security outlay reductions and hospital cost containment legislation are enacted, it would be possible to consider a reduction in Social Security taxes beginning in 1981. However, such a reduction would have to be considered in light of alternative uses of such savings, including reduction of any budget deficit and funding of high-priority programs. Beyond the immediate reforms I have proposed, the Administration is committed to review the entire pension system that has developed in our country. I have established a Pension Commission to provide the type of long-range analysis this vital area needs. Disability Insurance Reforms I will propose to Congress an integrated package of reforms for the Disability Insurance system, separate from the Social Security changes I have just discussed. These measures will improve incentives for rehabilitation of the disabled, ensure that benefits do not exceed pre-disability disposable income, and make administration of the system simpler and more consistent. We must make certain that those who should receive benefits are not excluded, but that those who are not truly disabled or can otherwise return to work, do so. Welfare Reform The Nation's welfare system is inequitable, inefficient and long overdue for serious reform. I will recommend to the Congress a package consisting of reforms in cash assistance, expansion of the earned income tax credit, an expansion of private and public job opportunities for welfare recipients, and fiscal relief for State and local governments. This package will enable us to develop a welfare system that is more simple, narrows the great differences in the way States help the very poor, that encourages people to work, and that helps eliminate the fraud and abuse currently plaguing parts of our welfare system. My Administration has already begun to work closely with this Congress to enact welfare reform this year. We must expeditiously move forward with welfare reform this year. Families Our major social initiatives and goals for this year will be undertaken with vigor and with a commitment to the security and enhancement of the American family structure. Our government must never impede nor work against the American family, but rather we must design programs and policies that support families and ensure that future generations of American families will thrive and prosper. The White House Conference on the Family will continue and expedite its planning this year with that goal firmly in mind. Child Welfare Reform The Nation's present system of overlapping, inadequate child placement programs does a great disservice to parents, foster parents, and children in need of homes. There is too little emphasis on reunification of families and permanent placement of children; the special problems of hard-to-place children often go unattended. I will therefore again propose to Congress major reforms in our foster care and adoption services, and urge prompt Congressional approval. This problem must not be left unattended any longer. Older Americans Early in the Administration we moved to correct one of the major concerns of older Americans: the possible bankruptcy of the Social Security Trust Funds. The legislation that was enacted ensures the financial solvency of the funds through the beginning of the next century. The Administration has also acted to help remove discrimination against senior citizens by supporting the legislation which removed the forced retirement requirement in the Federal civil service and postponed mandatory retirement in the private sector from age 65 to 70. In addition, the Administration worked with the Congress to amend the Older Americans Act in a way that will improve the administration of the Act's social and housing programs, employment provisions, food delivery, and establishment of centers for the elderly. This year the Administration will continue its efforts to ensure that seniors remain in the mainstream of American life, free from age discrimination and able to receive the assistance and other benefits they have earned. Veterans Our Nation has no obligation more basic than providing for those men and women who served us as members of our armed forces. There are still many veterans who need medical care, employment assistance, and assistance in adjusting to disabilities that resulted from their service. During the last two years we have made significant improvements in programs to help meet all these needs. In 1979 my Administration will seek legislation to increase compensation rates for disabled veterans, improve education programs for the disadvantaged under the G.I. Bill, provide special readjustment counseling assistance for those Vietnam Era Veterans who need them, and modernize the VA vocational rehabilitation program. These efforts will help veterans help themselves. In addition, we will continue to provide quality medical care in our VA hospital system by making it more efficient and thus more responsive to the needs of a changing veteran population. Education Improving skills and educational opportunities has been one of my Administration's major goals. To aid in this improvement, I have increased the Federal Office of Education budget authority alone by 505¢ since taking office—from $8 billion in FY '77 to $12.2 billion in the proposed FY '80 budget. The increased education funding will continue to be targeted at programs which emphasize equal education opportunity, support for local schools, student assistance, basic skills, and the linkages between school and work. School districts with high concentrations of low income children have extra costs in meeting their commitment to equal educational opportunity. Last year I proposed concentration grants which would give supplemental payments for compensatory education programs in high poverty school districts. This year I am requesting $400 million to fully fund this proposal. As is stated elsewhere in this Message, I will continue to work with the Congress to create a Cabinet-level Department of Education. Through such a Department we can make certain that education receives the attention at the Federal level that it deserves. Higher Education Last year, I signed into law the Middle income Student Assistance Act, which extends Federal student aid to middle income families facing rising college tuition costs. I propose to fully fund the Basic Grants program and to continue funding for the other college student aid programs. This year I will propose reauthorization of our omnibus higher education legislation-the Higher Education Act and the National Defense Education Act. Through renewal of these acts, we can help enormously to ensure the continuation of strong higher education institutions and equal educational opportunities for all students. Our Nation owes a debt of gratitude to the historically black colleges, which in the past were the only source of college education for talented blacks, and which today retain a critical importance to the production of college-educated black citizens. One-half of all college-educated blacks earned their degrees at black colleges. I have vowed that I would enhance the role of black colleges during my term in office. I recently directed all Federal agencies to utilize more fully the resources at black colleges. And, in my FY '80 budget I have increased funding for Howard University, and asked for $120 million to fully fund the Developing Institutions Program, which strengthens colleges with high concentrations of minority students. Science and Technology When I came into office, I found Federal efforts to promote basic research and development lagging. I was determined to change this situation and develop a sounder scientific and technological foundation for the future. Basic scientific research and development is an investment in the Nation's future, essential for all fields, from health, agriculture, and environment to energy, space, and defense. We are enhancing the search for the causes of disease; we are undertaking research to anticipate and prevent significant environmental hazards; we are increasing research in astronomy; we will maintain our leadership in space science; and we are pushing back the frontiers in basic research for energy, defense and other critical national needs. Despite the severe budgetary constraints this year, we will continue to increase Federal support for basic research with a request for a 13% increase in outlays for FY '80. Even though Federal funding for basic research is being increased, I believe that the government's role in demonstration and commercialization pilot projects should be more selective, with greater reliance upon private sector financing. We are enhancing our high technology approach to defense to counter the growth of Soviet forces. We have a broad energy research program that emphasizes longterm applications of solar, coal, geothermal, biomass and alternate nuclear technologies. But we will rely on industry to do its full part in the demonstration of new technologies in energy and in other fields. Rather than government funding of their research and development, companies need more favorable investment climates, better economic growth, better trade prospects, and sound policies about patents, antitrust, procurement, and environmental regulation. Under the direction of the Department of Commerce, we are also engaged in a major Cabinet-level review of these aspects of technological innovation, with participation of numerous individuals from various industrial sectors. Science and technology are playing an important part in our international relationships as well. Many countries, especially developing countries, look to America for our expertise and problem solving abilities. I have proposed the establishment of a Foundation for International Technological Cooperation (FITC) to foster collaborative efforts with people and institutions in developing countries. These efforts will be directed to basic human needs in agriculture, nutrition, health, small-scale energy systems, and rural development. Science and technology also have played a critical part in the dramatic advances of our relationship with the People's Republic of China. These scientific and technological relationships that will be built with China will be parallel to many such relationships we have established and enhanced over the years with other nations and groups of nations. Space Last year marked the 20th Anniversary of the National Aeronautics and Space Administration. The 21 st year started with the incredible success of the Pioneer missions to Venus. This year we hope to open a new era in space with the first launch of the Space Shuttle. Under the national civil space policy I announced last fall, we will remain dedicated to ensuring YOU.S. scientific and technological leadership in space. To further that policy, my budget request for FY '80 includes funding to maintain the Shuttle development and production schedule to continue space science and exploration; to initiate efforts on selected areas of advanced satellite communications techniques; and to enhance remote sensing activities that will bring benefits in areas such as earth resources, climate, weather, pollution and agriculture. Communications Last year we worked with Congress to reorganize communications policy-making in the Executive Branch and enact legislation to strengthen public broadcasting. In 1979 our priorities will include: • continued work with Congress on the important effort to revise the Communications Act to take account of technological changes; • vigorous pursuit of the program already underway to increase minority ownership of broadcast stations through regulatory actions, government loan guarantees, and private loan and training programs; • a program to use new communications technologies to improve rural life by delivering education, agricultural, and medical services and by increasing the diversity of radio and TV; • elimination of unnecessary regulations and paperwork requirements in cooperation with the Federal Communications Commission; • proposals on the role of the Postal Service in providing electronic mail services; and • participation in the World Administrative Radio Conference to ensure that increasing demands for radio frequencies are balanced in a reasonable and flexible manner. Small Business As a former businessman, I am especially sensitive to the importance of small business in our economy and to the vital role the Federal government can play in assisting small business. Through a number of actions over the past two years, my Administration has worked to help small business flourish and remain competitive. Under the leadership of the Small Business Administration, we have increased tax incentives significantly for small business; expanded small business loan opportunities; worked to increase small business exports; expanded opportunities for minority-owned small businesses; and initiated programs to increase small business opportunities for women. In addition, we have begun preparations for a White House Conference on Small Business in January of 1980 which will include local and regional conferences throughout the country. This year, while continuing efforts to prepare for the White House Conference, the Administration will work closely with the Congress to develop legislation to improve the operation and effectiveness of the Small Business Administration. Cultural Affairs Over the last decade, the National Endowments for the Arts and the Humanities have made enormous progress in developing projects and materials to enhance our Nation's cultural life. This year, the Endowments will continue their distinguished record of achievement. I am hopeful Congress will provide adequate funds for White House Conferences on the Arts and Humanities. This year we will also strengthen the programs of the International Communications Agency, which present the diversity of American culture to the world and deepen our appreciation of other cultures. PROTECTING BASIC RIGHTS AND LIBERTIES Since taking office, I have worked to protect and enhance the basic rights and liberties provided to Americans under the Constitution and our other laws. With the cooperation of the Congress, we have made important progress in this area. Over the next year, though, a great deal remains to be done if our goal of ensuring equality and basic freedoms for all Americans is to be realized. The dream of equal opportunity remains unfulfilled. I will do everything in my power to bring that dream closer to realization. Civil Rights Civil Rights and Equal Opportunity I take no obligation of my office more seriously than that of striving to secure full civil rights and equal opportunity for all Americans. In the quarter century since the Supreme Court's historic desegregation decision, our Nation's progress in these vital areas of human rights had been significant, but we have more to do. I am determined to use all of my authority to resist any efforts to weaken enforcement of any of our civil rights and equal opportunity laws. Recent actions by some in Congress to impair my Administration's efforts to enforce the law of the land will be forcefully opposed. These laws have made our society more open to equality of opportunity than virtually any on earth, and attempts to weaken them cannot be tolerated or allowed to succeed. My Administration has taken important steps to make civil rights enforcement more effective. The Justice Department has been diligent in its prosecution of civil rights violations. The Office of Federal Contract-Compliance Programs (OFCCP) and the Equal Employment Opportunity Commission (EEOC) has been reorganized and granted increased authority. The OFCCP will vigorously enforce the guidelines of Executive Order 11246, which prohibits employment discrimination by Federal contractors and requires affirmative action by these contractors. In addition the EEOC will continue this year to provide an effective central mechanism to enforce compliance with our equal opportunity laws. As we have done in recent cases before the Supreme Court, my Administration will continue to strongly support affirmative action programs to help bring minorities into the mainstream of American life, while opposing rigid and inflexible quotas which have no place in our laws. Beyond existing laws, however, as I state elsewhere in this Message, we need to ratify two Amendments to the Constitution which will significantly clarify and enhance the liberties and rights of Americans: The Equal Rights Amendment and the District of Columbia Voting Rights Amendment. The Equal Rights Amendment will provide women with equal legal status in our country. We cannot effectively champion human rights throughout the world until we have given to women the full rights they are entitled to as citizens. We must also work to ratify the amendment that will finally give the citizens of the District of Columbia the rights other Americans have to elect voting representation in Congress. In addition, we need to correct a weakness in an existing civil rights law. Title VIII of the Civil Rights Act of 1968, which prohibits discrimination in housing, remains largely an empty promise because of the lack of an adequate enforcement mechanism. I will soon propose to the Congress that this problem be alleviated by providing the Department of Housing and Urban Development with cease and desist powers. That Department, which now investigates and makes findings upon individual complaints, would then be able to enjoin further discriminatory acts and to direct an appropriate remedy. My Administration will work with the Congress to see that this proposal is given prompt and favorable consideration. Women One of the overriding concerns of my Administration is ensuring equal opportunity for women. Last year we worked closely with the Congress to extend the deadline for ratification of the Equal Rights Amendment until June 30, 1982. That extension will provide a greater opportunity to ensure ratification of this long-overdue Amendment. I will continue to dedicate myself, as well as the full resources of my Administration, to the ratification effort. This is not a battle that we can afford to lose. I am determined to win. The opposition to the Amendment cannot be solidly based on an understanding of its legal effect. The Amendment will do nothing more—nor less—than provide equality to more than one-half of America's population. I am confident that with the active support of the members of Congress from States which have not yet ratified, we can achieve ratification of ERA. I urge you to join the effort to provide women, at long last, with equal rights under the law. My Administration has championed, and will continue to champion, the right of women to choose their roles in society. To protect those who have chosen the role of full-time homemaker: • We have succeeded in enacting legislation that provides assistance for displaced homemakers and we supported the legislation that has now reduced from 20 to 10 years the marriage requirement for a former wife to claim against her husband's social security entitlement. We are facilitating the choice of many women to combine family and work responsibilities. To accomplish this goal: • we supported the legislation passed to increase part-time and flexible-hour employment opportunities; and • we supported the Pregnancy Disability Act that outlaws employment discrimination based upon pregnancy, childbirth, or related conditions. We are striving to improve women's professional opportunities within the Federal government. To this end: • women have been appointed in senior positions in the Administration, including two Cabinet officers. About 20% of my senior appointees have been women, and many of them are in areas in which no previous women had served; and • we have strengthened and increased our equal employment opportunity enforcement. This year, in addition to continuing our efforts to ratify the Equal Rights Amendment, we will work closely with the Congress to enhance the economic standing of women—particularly the poor, minority, and elderly—by improving their access to housing, health care, and child care for those who choose to work. We will expand additional opportunities this year for women business owners and will create a permanent interagency group to review and help improve the position of women business owners. I will make every effort to select as many women as possible to fill the 152 new Federal judgeships. Their under-representation in the courts cannot be continued.. Our country needs and deserves the full participation of women in our society, and I am committed to taking the steps needed to ensure this partnership. District of Columbia My Administration worked with the 95th Congress to pass a proposed amendment to the Constitution granting full voting representation to the citizens of our Nation's Capital. The ratification process for this proposed amendment has begun and I urge the state legislatures which have not ratified the resolution to join with the States of New Jersey, Ohio and Michigan by promptly ratifying the amendment. My Administration will work this year in the effort to ratify this amendment. My Administration will also work closely with the Congress and the new District Government under Mayor Marion Barry to expand home rule for the District. This includes streamlining the procedures for Congressional review of locally enacted legislation, removal of the Federal government from the District budgetary process by 1982, developing a rational formula for determining the Federal payment to the District, and an equitable Federal sharing of financial responsibility for funding of the District's pension plan for police, firemen, teachers and judges. I will work with Mayor Barry to make our Nation's Capital city a model for the rest of the Nation to emulate. Native Americans The Federal government has a special responsibility to native Americans, and I intend to continue to exercise this responsibility fairly and sensitively. My Administration will continue to seek negotiated settlements to difficult conflicts over land, water, and other resources and will ensure that the trust relationship and self-determination principles continue to guide Indian policy. There are difficult conflicts which occasionally divide Indian and non-Indian citizens in this country. We will seek to exercise leadership to resolve these problems equitably and compassionately. Handicapped For Americans with physical disabilities, this year will result in continued improvements in their accessibility to many opportunities those of us who are not disabled take for granted—education opportunities, employment opportunities, and greater access to public facilities and services. We will make further progress in removing obstacles that impede and discriminate against our disabled community. If our Nation is to remove the barriers of discrimination in our society, the Federal government must serve as a model in the successful removal of physical and psychological barriers thrown in the way of our Nation's disabled. The Section 504 Regulations issued by the Department of Health, Education, and Welfare provide a basis for the Federal government to lead the way in ensuring the rights of the handicapped. Undocumented Aliens One of the most difficult and sensitive domestic issues facing the country concerns the Federal government's policy toward undocumented aliens. I continue to believe that effective but humane measures need to be devised which will help relieve the causes and effects of the presence of large numbers of undocumented aliens in this country. I will pursue this issue in my consultations with the government of Mexico during my visit there next month and will make no final decisions until after those consultations. Martin Luther King, Jr. Dr. Martin Luther King, Jr. led this Nation's effort to provide all its citizens with civil rights and equal opportunities. His commitment to human rights, peace and non-violence stands as a monument to his humanity and courage. As one of our Nation's most outstanding leaders, it is appropriate that his birthday be commemorated as a national holiday, and I will strongly support legislation to achieve this. Minority Business This year we will move vigorously to implement the strong minority business legislation enacted by Congress in 1978; meet my goal of tripling Federal procurement from minority businesses (to a total of $3 billion); faithfully implementing the minority set-aside programs of the government and improve the operation of the several programs designed to achieve equal entrepreneurial opportunity and vital minority economic development. We are currently evaluating the adequacy and organization of current minority business development programs, with the commitment to taking whatever action, legislative or administrative, is needed to ensure that their operation is efficient and effective. Civil Liberties Privacy Government and private institutions collect increasingly large amounts of personal data and use them to make many crucial decisions about individuals. Much of this information is needed to enforce laws, deliver benefits, provide credit, and conduct similar, important services. However, these interests must be balanced against the individual's right to privacy and against the harm that unfair uses of information can because. Individuals should be able to know what information organizations collect and maintain about them; they should be able to correct inaccurate records; and there should be limits on the disclosure of particularly sensitive personal information. My Administration is developing a comprehensive privacy policy to address these concerns. Last year, legislation was enacted which established restrictions on wiretapping for intelligence purposes and on government access to financial records. Early in 1979, I will propose privacy legislation to cover medical, financial, and other sensitive personal records. I will also • take administrative actions to strengthen privacy controls for Federal agencies' records. These measures will go far toward giving all American citizens the privacy protections they need in a modern society. I recently announced my intention to submit legislation to Congress protecting the rights of the press, and others preparing materials for publication, from searches and seizures undertaken without judicial approval. Under the legislation I will propose, Federal, State and local law enforcement officials will generally be required to obtain a subpoena before conducting a search or seizure against those preparing materials for publication. Such legislation, which would deal with the problems created by the Supreme Court's decision in the Stanford Daily case, should serve as a solid protection of the rights of the news media and others under the Fourth Amendment. Labor Law Reform The Nation's labor laws are vital to ensuring that a sound labor-management relationship exists in collective bargaining. Efforts to abuse those labor laws, especially by unduly slowing or blocking their implementation, have increased in recent years. As a result, a reform of our labor laws is required in order to guarantee that their intended spirit is fully observed and enforced. I am again prepared to work with the Congress to develop legislation which improves the fairness and effectiveness of our labor laws. Efforts to defeat this legislation last year were based on emotion and a lack of information about its actual effect. If the will of the majority in Congress is allowed to prevail, we can enact sound labor law legislation. Export Administration/Anti-Foreign Boycott My Administration will work with the Congress to reauthorize the Export Administration Act, which plays a vital role in ensuring that American trade serves our national interest. We will make particular efforts to reauthorize that part of the Act which prohibits American compliance with the foreign economic boycott of Israel. The anti-boycott amendments passed by the Congress were fair and equitable and must continue to be strenuously enforced. Intelligence Charters I will be working closely with the Congress to develop and enact statutory charters for the intelligence community. The charters, for the first time, will define in law the duties and responsibilities of our intelligence agencies and will set forth the authority of those agencies to fulfill those responsibilities. The disclosures of abuses in recent years make clear the need for charters, and my Administration is strongly committed to developing and passing charter legislation that protects our citizens' rights, while permitting our intelligence agencies to perform. effectively their essential duties. Criminal Code The Federal criminal laws are often archaic, frequently contradictory and imprecise, and clearly in need of revision and codification. My Administration will continue to work with the Congress to develop a Federal criminal code which simplifies and clarifies our criminal laws—as well as protects our basic civil liberties. The criminal code which passed the Senate in the last session can serve as a basis for progress this year. Hatch Act Reform We will continue to support efforts to reform the Hatch Act so that Federal employees in non-sensitive positions will have the right to participate in off-the-job political activities while preventing any on-the-job political abuse. Hunger We share a growing concern with other Nations and their people over the serious problem of world hunger. While our government and the governments of other Nations and international organizations are working to assure the basic right to food, the problems of hunger and malnutrition are a daily fact of life for millions of people throughout the world. In order to make our own programs more effective and to examine additional efforts that might be undertaken, I have established the Presidential Commission on World Hunger, under the leadership of Ambassador Sol Linowitz, to recommend realistic solutions which we and other Nations might undertake in a prompt and efficient manner. The Commission will report to me this year and will then be involved in the implementation of its recommendations. The Administration will be working closely with Congress on the Commission's recommendation. Holocaust Commission Last year I established a Holocaust Commission to recommend to me how our government might officially recognize, for the first time, the tragedy of the Holocaust. The Commission's work is well underway, and I will receive its report this year. I expect to work together with Congress in developing a suitable memorial to the millions who died in the Holocaust. PRESERVING AND DEVELOPING NATURAL RESOURCES My highest legislation priority during the 95th Congress was enactment of our first national energy plan. The dedication of many members of Congress made that goal a reality. My Administration is committed to using that legislation as the foundation for further efforts to reduce our dependence on foreign oil; to increase our ability to develop domestic energy sources; and to conserve wasted energy. Our energy and other development goals can and will be reconciled with the Administration's resolve to clean the Nation's air and water and to preserve our most precious natural resources. We will continue to further the protection of our environment. We will continue to develop our fertile agricultural land. The Administration is committed to helping our Nation's farmers continue to achieve record yields and exports. Energy The Administration remains committed to meeting our future energy needs. Building upon the framework of the National Energy Act, signed last November, we will be addressing key issues such as further developing and commercializing solar and renewable energy resources, making better use of our coal reserves and other abundant energy resources, continuing our emphasis on using energy more efficiently, and improving the manner in which we produce and use conventional sources of energy such as oil, natural gas, and uranium. To minimize the impacts of potential supply disruptions, we will continue the storage of oil in the Strategic Petroleum Reserve, and will be submitting for Congressional approval overall energy contingency plans. While much remains to be done in the energy area, past investments in improving our energy supplies and our energy use are beginning to pay off: the rate of growth of our industrial energy use has dropped while industrial production has increased. From 1975 to 1977 the growth in domestic energy consumption has been 70% of the growth in GNP Previously, the two growth rates had been roughly equal. With significant improvements in automobile efficiency, gasoline consumption is an estimated 5% lower than it otherwise would have been. Use of heating oil, electricity, and other home energy sources has become much more efficient. Oil consumption grew last year at a rate of only 1.5%. On the supply side, the new natural gas legislation, whose provisions have just begun to take effect, will ensure new domestic production of this premium fuel and help expedite the delivery of natural gas to the interstate market. Furthermore, due to the addition of Alaska North Slope oil, our domestic production of oil has held steady over the last year, and foreign imports were down in 1978. In 1979 and the FY '80 budget we are continuing strong investments in energy research and development. The FY 1980 budget provides outlays of $3.7 billion for a wide range of programs to develop energy technologies for the future. Particular emphasis will be given to long-term solar energy research and development, to improvements in the mining and burning of coal, fission and fusion research, to improvements in existing technologies for conservation, oil and gas recovery, and uranium efficiency, and to energy-related basic research. These commitments to technologies for the future, both long and shorter term, are critical to a sound and comprehensive energy policy. Solar Energy Within the next few weeks, I will send to the Congress a message on solar energy based on an interagency study under the Domestic Policy Review System. The transition to wide-spread use of solar and renewable resources can and must begin now. Solar, wind energy, and use of biomass resources can contribute significantly in both the short and long run to meeting our Nation's energy needs. Some of these technologies, such as solar heat and hot water, use of biomass for generation of electricity, and wind energy, are available now and are competing with other conventional energy sources. The tax credits in the National Energy Act, along with other commercialization incentives, will help accelerate the use of solar and other renewable technologies in the residential and industrial sectors of our economy. The FY 1980 Budget increases our government-wide solar research and development programs by 40% over FY 1979. Total expenditures for solar energy will exceed $800 million, including tax credits and important initiatives undertaken by the Department of Energy, the Agency for International Development, the Tennessee Valley Authority, the Department of Agriculture and the Small Business Administration. Application of solar technologies in federally-owned buildings will also increase, thereby providing new markets for our existing solar industry. In our research and development program, strong emphasis will be given to photovoltaics through which electricity can be produced directly from solar energy. Conversion of organic materials to useable energy forms will also receive increased funding. Funds for the new Solar Energy Research Institute at Golden, Colorado, will also be increased. The proposals I will later announce, coupled with the FY '80 budget, will chart a firm and ambitious course for accelerating the use of solar and other renewable energy sources both now and in the future. The time for solar energy has come. Other Energy Research, Development, and Demonstration In the coming year, significant investments will be made in the demonstration of technologies which can convert coal to more useable and environmentally acceptable energy forms, continued strong research and development in fusion, development of geothermal energy sources, such as hot underground brines and hot rock resources, and efforts to resolve a range of environmental issues which these and other technologies raise. Nuclear Energy A wide range of Administration initiatives, both legislative and administrative, will be proposed to ensure that this country can further use light water reactors for the generation of electricity, safely and efficiently. Of central importance will be the development and implementation of a strong, responsible program to manage and dispose of nuclear wastes. As a result of the work of the Interagency Review Group on Waste Management, I will be making a series of legislative and administrative recommendations to ensure that the necessary schedules, coordination, and legislative authorities are firmly in place. Public discussion and participation in the nuclear waste management area, along with the close cooperation of State and local elected officials, will receive continued high priority. Legislation will also be proposed to provide interim storage for spent fuel from existing reactors until a permanent waste repository is established. Enactment of nuclear licensing and siting legislation to shorten the lead times required to plan, locate, construct and license nuclear power reactors will again be sought. Design and construction activities for the new centrifuge enrichment plant at Portsmouth, Ohio, will continue to ensure that the YOU.S. is able to meet the nuclear fuel needs of our domestic industry, as well as our international customers who share our non-proliferation objectives. These activities, coupled with the Administration's waste management program will help ensure that our country can continue to rely on current nuclear technologies to meet power needs. Looking toward the future, we will seek to improve the efficiency of our existing power reactors by reducing their uranium feed requirements. For the longer run, the Administration will maintain and strengthen the strong research and development program we now have for more advanced nuclear fission technologies such as the fast breeder reactor. We continue to believe that the Clinch River Breeder reactor project is premature, technically inadequate, and should not go forward, but the Administration is committed to keeping the breeder option open for the future. Domestic Crude Oil Pricing Provision of adequate incentives for both domestic production of crude oil and for conservation must be carefully weighed in light of our efforts to control inflation. In consultation with the Congress, I will be making my decisions and recommendations on domestic crude oil pricing and related issues later this year. Energy Impact Assistance As new domestic energy resources are developed, particularly in rural or isolated areas of the country, provision must be made for the needs of rapidly developing communities. The Administration will again seek enactment of legislation establishing an Inland Energy Assistance program, with funding of $150 million per year, to aid those states and local areas which are experiencing a rapid growth in population as a result of new energy supply development. These communities often cannot plan for or meet increased need for new public facilities or services, since the population increases occur before the new energy supply activities are fully developed and producing local revenues. This legislation is essential to ensure that the burdens associated with solving our energy problems are borne equitably by all citizens and regions of the country. Management of Federal Energy Resources The last two Congresses passed landmark legislation to reform the management of federally-owned coal, oil and gas resources. These new laws include Federal strip mine controls, and amendments to the Outer Continental Shelf Lands Act and the Mineral Leasing Act. With this new framework, the Administration is proceeding to implement swiftly new programs which will permit increased leasing and development activities while protecting our environment. Water Policy Legislation Water is a basic human necessity and its proper management is essential to economic activity, particularly in the arid West. The policies of my Administration are designed to emphasize the more efficient use of water as well as the need to provide adequate water supplies. We are particularly sensitive to the interests of the West and other areas in the development of additional water resources, to the importance of water conservation, and to the concerns of many Eastern urban areas about their water systems. Last year I announced a comprehensive water policy which included many reforms now being implemented administratively. In addition, I will propose legislation to increase the role of the States in water policy, through increased water planning grants and through new grants for state water conservation programs. I will also propose legislation which would provide for states to share in the costs of Federal water projects. This cost proposal will result in direction by states in setting water project priorities and will help insure that Federal programs are responsive to the most pressing water-related needs. Congressional action is also needed on Administration Amendments to modernize the 1902 Reclamation Act to ensure that acreage limitations in federally funded irrigation projects are equitable and fair. Environment My Administration is committed to balancing the needs for development, conservation and preservation of our natural resources. Our Nation has been blessed with an outstanding natural heritage which, if properly cared for, can meet our needs for food and fiber, mineral, energy, recreation, and solitude in a way that is environmentally sound. The Congress and the Administration have worked together, over the past two years to achieve this goal. We have enacted the first Federal standards for strip-mining coal; we have improved and extended the Clean Air and Glean Water Acts; we have created a substantial number of new National Parks and other protected areas. During 1979, protection of Alaska lands, implementation of water policy, resolution of wilderness and nonwilderness designations in the National Forest System and reformed management of Federal energy resources will be major environmental initiatives of my Administration. Efforts to enforce and implement environmental statutes firmly and fairly, to streamline environmental review requirements, to protect public health and to preserve wildlife resources will continue to be pursued vigorously and as cost-effectively as possible. Alaska As in the last Congress, passage of legislation designating National Parks, Wildlife Refuges, Wilderness Areas, National Forests and Wild and Scenic Rivers in Alaska is the highest environmental priority of my Administration. To protect these magnificent. Alaskan wild lands, I took several actions after the adjournment of the 95th Congress, including the creation of 17 National Monuments covering 56 million acres. These areas, as well as other outstanding parts of Alaska covered in Administration proposals, should be protected promptly by legislation in order to assure that the great national treasures of wildlife, scenery, history and untouched ecosystems can be saved for our children and grandchildren, while permitting appropriate commercial use of certain of the areas. Roadless Area Designations (Rare II) The Agriculture Department has released tentative recommendations and nearly completed work on a study which will lead to proposals to resolve the status of most of the remaining roadless areas in the National Forest System. The Administration proposal will involve additional wilderness designations in many States and the release of remaining lands for nonwilderness activities. This initiative will also eliminate uncertainty over land uses in most parts of the National Forest System and will ensure that development uses will be adequately supported, while preserving critical parts of our natural heritage in an unspoiled condition. Environmental Protection In recent years, the quality of our environment has improved, but much remains to be done to clean up our air and water, and to control contamination by toxic materials. The Environmental Protection Agency is focussing its efforts on the protection of public health by assessing the effects of substances before they are introduced into the environment, and by ensuring that hazardous wastes are disposed of safely. At the same time, EPA, and the other health and safety agencies are exercising new care when implementing environmental regulations to avoid imposing unnecessary costs or red tape. A healthy, safe environment need not be incompatible with a healthy economy. We are committed to both. The Nation's investment in environment cleanup must have the incentives and the flexibility to allow our most important environmental goals to be achieved at the lowest cost. Unnecessary requirements which because delays and increase costs will be removed. EPA will simplify and consolidate its permit programs to reduce paperwork, red tape and delays. The Agency is beginning to introduce innovations which allow firms the flexibility to find the lowest cost methods of controlling pollution. I will submit legislation to consolidate Federal funds for environmental programs at the State level, thus giving the States more flexibility to use these funds to deal with their most pressing environmental problems. These and other changes we are making will assure the American public that the money we spend on environmental controls is the best investment we can make in our future and our children's future. The State of Food and Agriculture World food security has been substantially improved in 1978. For the third consecutive year, good-to-record crops were harvested in most parts of the world, pushing supplies to record quantities and creating the opportunity for people all over the world to improve their diets. For the United States, 1978 was also a year of records. Large food and record feed grain crops were harvested by YOU.S. producers, re-emphasizing the YOU.S. farm sector's capability to lead the world in productivity. But despite the record crops which placed downward pressure on prices here and abroad, our farm economy became stronger in 1978 and our agricultural trade reached record levels. The value of YOU.S. agricultural exports reached $27.3 billion in fiscal 1978—14 percent above 1977's record. The volume of our farm exports was a record 125 million metric tons—up 18 percent from 1977. Agricultural trade made another record contribution to our balance of payments—$13.4 billion in fiscal 1978. Exports also accounted for one out of every four dollars the YOU.S. farmer earned. Net farm income, which was $20.6 billion in 1977, is estimated at over $28 billion for 1978—second highest on record. In constant dollars, this was the best year since 1975. This was achieved while we met our domestic needs, fulfilled our commitments to our overseas customers and built reserves for future stability protection. This recovery in agriculture has been shared by crop and livestock producers alike. Indeed, American livestock producers can now look forward to several years of good returns to help them recover from the last four years which were marked by poor prices and forced liquidation of herds. Part of the recovery in the farm sector can be attributed to the programs and policies adopted by my Administration and the Congress—which farmers have used to improve their incomes and stabilize prices. I am personally proud of the recovery our farmers have made. International Agricultural Trade Over the past 2 years, this Administration has worked to reduce barriers to international trade and to develop new markets and encourage increased exports of agricultural products. The Agricultural Trade Act of 1978, for example, provides important new authorities for intermediate credit and the establishment of trade offices in major markets. We have moved to establish new and stronger trade ties with several nations, including Japan and the People's Republic of China. Partly as a result of these efforts, exports of YOU.S. farm produced goods are expected to reach a record $29 billion in fiscal 1979-21 percent higher than 2 years ago—and contribute $15 billion to our balance of payments. Unlike previous Multilateral Trade Negotiations, in the current MTN we have placed heavy emphasis on the lessening of restrictions on trade in agricultural products. Our efforts here should have a major impact on YOU.S. agriculture in the future, by broadening our access to important existing and new international markets. Crop Insurance The Federal government now operates several programs to protect farmers from economic losses associated with crop failure. The experience of recent years with these programs has demonstrated their many serious shortcomings—in the breadth of coverage, the equity of program benefits, and the efficiency of program administration. We will propose again a comprehensive, nationwide all-risk insurance reform bill to the 96th Congress aimed at providing fairer and more effective protection for farmers, and at no additional cost to the taxpayer. Under this proposal, several existing disaster assistance programs would be consolidated into one comprehensive, share-the-cost program to ensure against economic losses resulting from natural disaster and other uncontrollable risks. International Emergency Wheat Reserve The cornerstone of our domestic food and agricultural policy is the farmerowned grain reserve. In little more than a year, we have built this into a 1.3 billion bushel grain reserve—the equivalent of more than a third of our carry-over stocks from the past year. These stocks remain under the ownership of those farmers who produced them rather than in the hands of government or international grain traders. This reserve provides a critical cushion against shocks in the market caused by production shortfalls either here or abroad. We now need to establish the same sort of protection for our international food aid programs. Accordingly, the Administration will reintroduce legislation to authorize the establishment and management of an international emergency wheat reserve. This reserve will provide developing countries assurance that we will be able to fulfill our food aid commitments. At the same time, it will protect the domestic economy from further inflationary pressures during periods of grain shortages. Sugar In the absence of Congressional passage of a domestic sugar program in the last session, the Administration has taken several further steps to assure domestic producers of a fair return and consumers an assured supply at stable prices. To underscore Administration commitment to achieving ratification of the International Sugar Agreement, I directed that sugar imports from countries not party to the agreement be strictly limited to the levels permitted under the agreement for 1979. We have also asked for and received an extension of the deadline for ratifying the ISA to June 30, 1979. In addition, at the end of last year, I issued a proclamation that provides for a new, more flexible system of sugar import fees protecting a domestic raw sugar price of 15 cents per pound. To help stabilize world sugar prices, to satisfy our international commitments, and to protect our domestic sugar producers, my Administration is committed to working with the Congress to develop an effective, non-inflationary domestic sugar program early in this session, and to achieve ratification of the International Sugar Agreement. Rural Development Throughout 1978 my Administration took steps to make existing Federal rural development programs work better. For many rural areas, and for most rural residents, the 1970's have been a period of rapid growth and development. Income levels have risen and large numbers of better jobs have been created in rural communities across the Nation. Rates of population and employment growth for rural areas have been substantially greater than for urban areas—causing problems of unplanned rapid growth in some areas but also reversing decades of rural out-migration and economic stagnation. Nevertheless, rural Americans still experience a disproportionate concentration of pressing human problems: • two-thirds of all homes lacking complete plumbing are in rural areas; • rural infant mortality rates are 10 percent higher than urban ones; • 70 percent of the rural poor and half of the rural elderly have no automobile, causing great hardship because of the distances to travel to get access to basic health care, jobs, and other social services; • while only a quarter of all Americans live in rural areas, 40 percent of the Nation's poor live there. For too long the small town mayor, the rural county official and the individual rural American have been frustrated by a maze of Federal grant applications, requirements, eligibility standards, audits and deadlines which have made it virtually impossible to address these rural problems effectively. For too many years, money and time has been wasted. We are moving to address this chronic problem. In the last year, White House Rural Development initiatives have resulted in: • a commitment to build 300 rural primary health clinics to serve 1.3 million Americans who lacked access to care; • major streamlining of the rural water and sewer grant process through which five agencies distribute $2.5 billion in Federal funds each year. The new process permits a single application, single audit, single funding source and single point of Federal contact—at a savings to local government of several hundred million dollars each year along with a reduction in processing time of as much as 15 months; and • specially targeted rural job training programs for rural disadvantaged in the water and sewer and health support fields. This effort to address rural problems will continue and be expanded in 1979, addressing the problems of rural transportation, housing, and economic development among others. In addition, during the year I plan to articulate a set of overall rural development principles and goals which will guide the actions of my Administration. These principles will provide focus, direction and priority to the myriad of now separate Federal actions and policies, so that we can more effectively work to: • overcome the problems of rural isolation; • promote economic development; • meet basic human needs; • protect the quality of rural life; • assure equity in the administration of Federal programs for which rural Americans are eligible; and • build a more effective partnership among Federal, State .and local governments and the private sector in meeting locally defined rural development priorities. Furthermore, several other Administration initiatives will have an impact on the conditions in rural America. We will make certain that the rural perspective is considered as initiatives are developed in such areas as welfare reform and a national health plan. FOREIGN POLICY PRIORITIES THE CONTINUING CHALLENGES OF CHANGE When I took office two years ago this month, I was convinced that America had to pursue a changed course in a world which was itself undergoing vast change. In the midst of this accelerating change, America's choice lies between facing chaos or building with others a new foundation for a true world community. Our foreign policy accepts the latter responsibility both because of our basic belief, and because of America's critical role in the world. To this end, we must have four broad objectives: • to buttress American power on which global security and stability depend; • to strengthen our relations with other nations throughout the world in order to widen the spirit of international cooperation; • to deal constructively with pressing world problems which otherwise will disrupt and even destroy the world community we seek; • to assert our traditional commitment to human rights, rejoining a rising tide of belief in the dignity. of the individual. Progress towards these goals depends first on our ability as a Nation to work together in the common interest. During the coming year, the Congress, the Executive, and the public will be addressing an unusually wide range of international issues. The action taken will have an impact on our Nation's position in the world for many years to come—in establishing a secure nuclear balance, in developing closer relations with the world's most populous Nation; in achieving an historic step towards peace in the Middle East; or in setting the pattern of trade relations during the next decade and beyond. This report elaborates on my address to the Congress and, in particular, concentrates on the issues in which the role of the Congress will be most important to building a new foundation for peace. In each case, the challenge is clear: to exercise strong American leadership with others to shape change rather than permit change to shape us. AMERICA'S MILITARY STRENGTH Elsewhere in this report I have described the domestic programs and policies required for a just, united and productive America. The maintenance of American military strength is an essential foundation for a successful foreign policy that safeguards our freedom, our accomplishments and our friendships. In a world of accelerating change, fraught with potential danger and uncertainty, and marked by a continuing Soviet military buildup, we must have, together with our allies, unsurpassed military capability to deter attack or attempts at political coercion. Moreover, we must have the military force to mount an effective defense at any level of hostilities where our vital interests are jeopardized. The defense budget which I have presented to the Congress funds a program of prudent investments that will ensure the effectiveness of our strategic and conventional military posture. It will: • begin full-scale development of a new, more survivable ballistic missile system to enhance the ICBM component of our strategic triad; • maintain the Trident submarine and missile programs, increasing the security, striking power and the range of our submarine force; • extend the effectiveness of our bomber force with the addition of air-launched cruise missiles; • pursue a vigorous program of research and development in cruise missiles, aircraft and other systems to ensure the continued technological superiority of America's nuclear deterrent. In addition, the defense budget I have submitted this week will strengthen our conventional capabilities to fulfill our commitments to our major allies and friends and retain a credible military presence in both the Atlantic and the Pacific. We will continue to add armor and firepower to our infantry and build a more modern, smaller aircraft carrier which, together with more frigates and destroyers, will improve the effectiveness and flexibility of our surface fleet. In NATO, we have already achieved important progress toward making the Alliance more effective in the changing security environment. • We helped launch the Alliance's Long-Term Defense Program to offset growing Soviet modernization of its deployment in Europe. The LTDP will increase NATO military capabilities through better coordination of defense efforts, increased investment, and more modern equipment. • We removed, with the support of Congress, a serious obstacle to strengthening Turkey's defensive capabilities and made further progress toward the reintegration of Greek armed forces into NATO's military structure; both these efforts helped repair a serious deficiency on NATO's southern flank. • We neared final agreement with the Portuguese on the renewal of our base rights in the Azores. The provision of adequate military as well as economic assistance to Turkey, Portugal and other allies and friends in need will be a matter of high priority during the coming year. NATO's strength is growing. In 1979, we can further that encouraging process by standardizing more of the Alliance's equipment and improving Allied readiness. The proposal I will soon put before the 96th Congress calls for the authorization of intergovernmental agreements to simplify logistical problems both in peacetime and during any period of hostilities. Such agreements will permit the YOU.S. to reinforce NATO more rapidly and provide more effective defense at lower cost. We also intend to maintain a vigorous American military presence in the Pacific. Successful completion of a revised military base agreement in the Philippines, following ten years of negotiations, provides an essential underpinning for our military capability in Asia. Congressional authorization for the transfer of military equipment to the Republic of Korea was another contribution to assuring the security of Korea and Japan. Both actions unmistakably signal not only our desire to promote East Asian stability but our intention to remain a concerned, involved and responsible power in the Pacific. The essential task of improving our military posture must also be accompanied by increased efficiency. I take this opportunity to thank the Congress for its support last year of our actions to reduce waste and needless duplication in our defense budget. Vigorous cost-saving efforts will continue this year in order to assure that the United States will possess strong military forces at the lowest possible cost. BUILDING THE COMMUNITY' OF NATIONS Military strength is essential to peace but cannot alone guarantee it. The system of cooperation we have with the rest of the world is part of the foundation for our own security. Our best hope for a safer America and a peaceful world resides in the building of closer ties with as many nations as possible. The Major Allies Throughout 1978, the North Atlantic Alliance and the growing partnership which links us with both Western Europe and Japan remained at the heart of our foreign policy. The cooperation we share with those whose purposes and traditions are closest to our own is strong and growing stronger. Through our summit meetings, and through an unprecedented pattern of consultations at other levels of our governments, we are working together on virtually all of today's most critical issues: • together we are seeking to reduce the risk of nuclear confrontation; • we are working on ways to strengthen the common defense; • we are attempting to promote a peaceful transition in southern Africa; • we are striving to resolve conflicts in the Eastern Mediterranean to support a just and lasting peace in the Middle East and to maintain stability in the Persian Gulf; • we are contributing to a sounder international economy; • we are consulting on the issues that confront all our societies: the problems of youth and age, family and community, growth and conservation—in short, advancing our democratic ideals at home in a time of change in each of our countries. America's role as host for the NATO summit meeting in Washington last spring, and our attendance at the seven-nation economic summit in Bonn last summer, symbolized American commitment to the strength of relations with Europe and Japan. I look forward to meeting these and other allied leaders at the Tokyo Summit next June, where we will continue the essential effort to deepen further the cooperation between us. A Wider Community The changing realities of political and economic interdependence require that we strengthen our ties throughout the developing world and seek to improve relations with Communist nations as well. My trips to Nigeria, India, Saudi Arabia, Iran, Brazil, and Venezuela underlined American sympathy and support for the international roles these countries are playing in the process of world change. Strengthened consultations with the ASEAN nations serve the same end. My trip to Mexico early next month will be a part of this process; Mexico is important to us not only because it is a neighbor but also because it is one of the most vigorous democracies in this Hemisphere and a leader in the developing world. As neighbors, we share an agenda of common concerns—trade, migration, economic growth and social development-that provides an opportunity to establish a uniquely productive, cooperative relationship. My trip to Poland and the visits of Secretary Vance and Secretary Blumenthal to Hungary and Romania underscore the importance we attach to better relations with the nations of Eastern Europe. The support of the Congress for our policy toward Eastern Europe has provided a strong foundation for building a stronger economic, cultural and political relationship—a process that will continue to go forward in the coming year. China The arrival next week of the first leader of the People's Republic of China to officially visit Washington will give us an early and welcome opportunity in the new year not only to cement the ties of friendship and hospitality between us but to emphasize our expectation that our relationship with China will be a constructive one. It will contribute to diversity in the world and to peace and stability in Asia. It is not directed against the interests of any other country. To fulfill the promise of this new era in Sino-American relations, we will require legislation and support from the Congress. Such legislation is particularly important to facilitate continued trade and other relations with the people of Taiwan through non-governmental instrumentalities and to assure continued peace and prosperity there. This has very high priority in our legislative program for 1979. USSR We seek better relations with both the Soviet Union and the People's Republic of China. Doing so is profoundly in the interests of our Nation and of global security. I therefore would like also to welcome President Brezhnev to our country in the near future. At that time we would hope to conclude an agreement curbing the strategic arms race. There are other areas where our two nations can work constructively together. These include a comprehensive nuclear test ban treaty; limits on Indian Ocean deployments, and on the transfer of conventional arms; and restraint in areas of turbulence and tension. Such cooperative effort would do much to make the world a safer place for all. We will never ignore Soviet actions which challenge our interests. We both have a responsibility to our peoples and the world to maintain a pattern of detente which is genuinely reciprocal and broadly defined. DEALING WITH WORLD PROBLEMS A true world community cannot be fashioned or endure so long as the weapons of war multiply and spread, so long as ancient disputes fester and the demands for justice are unmet, so long as much of mankind remains impoverished and without hope. As I emphasized in my State of the Union address, the need to curb the strategic arms race has never been more urgent. It increases the risk of nuclear war. It is a needless competition that draws away scarce resources we need to invest in other areas of our Nation's strength. It undermines America's security. The conclusion and ratification of a satisfactory SALT II Treaty with the Soviet Union is therefore among our top priorities. It will make a major contribution to enhancing our long-term security, while keeping open our options to carry out needed modernization of our strategic forces and preserve our deterrence. We will take whatever time is necessary to negotiate a sound, verifiable agreement. I am convinced that once the American people and Congress have had a chance to examine the terms and benefits of this Treaty—and consider the shape of our future without it—they will conclude it serves our vital security interests. We will continue to consult the Congress as we proceed this year with other important arms control negotiations: on a comprehensive nuclear test ban; the prevention of anti-satellite warfare; mutual and balanced force reductions in Europe; and limits on the rising tide of conventional arms transfers. The risks inherent in the proliferation of nuclear technology figure prominently among the dangers to the world community. Although we and the rest of the world still have far to go in dealing responsibly with such risks, the United States took an important step last March with the adoption of the Nuclear Non-Proliferation Act. For the first time in our history we established comprehensive legislation covering international cooperation in the nuclear field and the export of nuclear-related materials. To build on that promising beginning throughout 1979, we need progress in the following areas, both nuclear and non-nuclear: • The International Nuclear Fuel Cycle Evaluation (INFCE), a 53-nation effort, can help us develop a new international nuclear fuel consensus that will adequately balance energy needs with non-proliferation concerns. We continue to believe that better alternatives exist to the commercialization of dangerous breeder reactors and we will cooperate as fully as possible with other countries in exploring those alternatives. • We will seek more substantial progress in the problem of managing nuclear waste and in attracting greater international support for the acceptance of nuclear safeguards. I ask the Senate to ratify the treaty on the IAEA Voluntary Safeguards Offer which will provide concrete proof of our belief that international safeguards do not interfere with the successful development and operation of commercial nuclear power. • I will call for early Senate ratification of Protocol I of the Treaty of Tlatelolco, which will contribute to the lessening of nuclear dangers for our Latin American neighbors; the YOU.S. and Cuba are now the only countries in our Hemisphere which have not yet ratified that Treaty. Regional Conflict and Tension Curbing the means of war cannot in itself remove the threat of war. For that, we must seek to resolve conflicts, ease tension and build trust. The urgency of this task and its importance to the United States and the world is nowhere more clear than in the Middle East. Though there has been great progress, the goal of a just and lasting settlement in that troubled part of the world still eludes us. No one who has looked at Middle East history can harbor any illusion about the difficulties ahead. Yet we have made great strides toward a final peace agreement between the two principal adversaries in the Middle East. The differences which they have overcome far outweigh the issues which still divide them. Israeli and Egyptian commitment to peace will provide an indispensable step toward peace between Israel and all its neighbors and foster the stability and orderly change we favor for the entire Middle East region. Peace will permit us to strengthen our ties with the Arab states in the region and enhance our relationship with Israel, a relationship which will always be special to us. In 1979 I will count on the continued collaboration of the 96th Congress on behalf of our efforts to gain and maintain peace throughout the region. The support of the Congress and the American people for a purposeful role in that region is particularly important in light of the tumultuous events taking place in Iran. Since the end of the Second World War, the United States has maintained a close relationship with Iran and it has a vital interest in Iran's independence and integrity. The people of Iran should shape their own future without foreign interference. That is the policy of the government of the United States and we expect it to be the policy of all of Iran's neighbors. Africa Congressional support for peace, stability, and orderly change are essential in other tense regions, as well. In Southern Africa we are trying to help bring about a peaceful transformation to majority rule which will avoid growing bloodshed between white and black and deeper intervention by the Soviet Union and Cuba. Together with our European allies, Canada, and African states directly concerned, we are making progress toward the independence and majority rule of Namibia—a step that would have a positive impact on the evolution of events in Rhodesia and elsewhere in Southern Africa. We are heartened by the support of the African leaders who have worked with us in efforts to resolve the Namibian and Rhodesian issues. Congressional repeal of the Byrd Amendment was essential in enhancing our credibility in the effort to avoid a gathering war and further Soviet and Cuban gains in Southern Africa. We will consult closely with the Congress during the coming months, as we seek the most constructive role we can play. It will be increasingly important to maintain our position of impartiality among the parties so we can help them resolve their differences should they choose the path of peace. Latin America In our own Hemisphere, we can point with pride to the cooperative spirit which enabled us to change, in mutually beneficial ways, the basis of our relations with Panama. Senate approval of the two Panama Canal treaties last year has improved the quality of our historic relationship not only with Panama itself but with our friends in every part of Latin America. By that act, our country helped demonstrate its ability both to protect major security interests and to deal with smaller nations with dignity and mutual respect. Congressional action to pass the necessary implementing legislation for these treaties before the October 1 deadline will ensure that the Canal is efficiently operated during the transition to a new partnership with Panama. The treaties and implementing legislation, like our efforts to help the people of Nicaragua find an enduring democratic solution to the current crisis there, are important to the future stability of Central America as a whole and the strengthening of our new and mature relationship with the nations of all Latin America. The International Economy In our daily lives, we are constantly reminded of the importance of a healthy world economy to the strength of our own. We see this in the wages of our workers who produce goods for export, in the choice of goods for our consumers, in the price of energy. We must work closely with other countries to ensure that the world economy can steadily develop through non-inflationary growth, while together we manage the use of its resources and protect our environment. The focus for much of this effort during the past year was the Bonn Economic Summit. We worked out a strategy of cooperation with our partners to improve the world economic situation: within the framework of those Summit decisions, West Germany and Japan have taken measures to stimulate their economies while we are giving top priority to fighting inflation. Our actions, along with those taken by other Summit participants, are leading to a convergence of economic policies that will strengthen the global economy. We have strengthened the dollar by working out arrangements with other countries to counter speculative disorder in currency markets. Since I announced my dollar stabilization measures last November, we stopped the dollar's decline in value against other currencies and have actually increased the dollar's value by around 10 percent against several major currencies. Moreover, we have announced a multi-faceted program to increase YOU.S. exports, which will benefit American farmers and workers, while further strengthening the position of the dollar. We are now close to new agreements with our trading partners to establish a fairer, better operating and more open framework for world trade. The American people have a vital stake in Congressional approval of these agreements. Ten million American jobs depend on our exports. Every third acre of our farmland produces for sales abroad. Twothirds of our imports are essential raw materials or goods we cannot readily produce. At a time of difficult strains in our own economy, there is always an impulse to abandon our commitment to an open world trading system. But the costs of such a course to the American people would be enormous. Each American family would pay more for what it buys and would have less choice in the goods available. Inflation would be fueled. Jobs would be jeopardized, for protectionism against our trading partners breeds protectionism by them against us. I am convinced that our economy can adapt to changing patterns of world trade in ways that protect the future of our workers. We can compete effectively in the world economy. The new trade agreements give us the opportunity to do so. Our programs of economic development assistance abroad are also an investment in our own future as well as the future of other nations. Our most rapidly growing markets lie in the developing world. By helping the people of these countries, we not only help extend their opportunities for a better life, we help ourselves. By demonstrating to their governments that we are concerned for the well-being of their people, we encourage their increasing cooperation with the West on a broad range of issues. I therefore urge Congressional approval of the funding we propose for our bilateral assistance programs and our participation in the work of the multilateral development banks and UN agencies. My proposal to establish a Foundation of International Technological Cooperation reflects our recognition that scientists in many developing nations are ready to work in collaboration with our technological institutions to solve the great problems of health, nutrition, productivity and other aspects of economic development. Key commodity agreements can also help us deal with the legitimate needs and interests of the developing countries. Senate ratification of the International Sugar Agreement, which we signed last year, along with price support legislation will stabilize prices for that important commodity. We have pledged a contribution to the International Tin Agreement, and we will conduct negotiations on a rubber accord. Efforts to build a stronger international economy are directed not simply at managing economic relationships among nations, but at improving the lives of individual people around the world. For it is the lives of individuals which define the success or failure of our foreign policies. REASSERTING AMERICA'S VALUES America's future is best secured in a world founded on decency, justice and compassion. The effort to make human rights a central component of our foreign policy comes from our deepest sense of ourselves as a humane and freedom-loving people. We do not make our standards the precondition for every relationship we have with other countries; yet human rights can never be far from the focus of our thinking or we violate our own best values. In the year just passed, some have quarrelled with the timing or the tactics of our emphasis on human rights abroad. Others have pointed to our own imperfect record on human rights at home. Yet few can dispute an important fact of this experience: our concern for human rights has met with great resonance in the world at large. The very term has entered the language and become imbued with an everyday familiarity that was simply unknown little more than two years ago. We believe our efforts have contributed to a global awakening: • thousands of political prisoners have been freed; • in several countries, torture of prisoners has been significantly reduced or eliminated and trials are more often open to the public; • open advocacy of human rights has occurred in nations where the concept was heretofore forbidden; • international organizations such as the UN and the OAS now have vigorous human rights commissions for the investigation and airing of human rights violations and the Commission on Security and Cooperation in Europe has helped to make human rights an institutionalized part of the international agenda on both sides of the Atlantic; • in a number of key nations around the world, democratic institutions are being strengthened as democratic values are reasserted. Americans can be proud of the leading role their government has played in advancing this process. I now ask the Congress to take action in 1979 which will further strengthen our human rights record. I have signed four important human rights treaties, including the Convention on Racial Discrimination, the International UN Covenants on Economic and Social Rights, and on Political and Civil Rights, and the Inter-American Convention on Human Rights. Senate ratification of these treaties will firmly align our Nation with the growing forces for rule of law and human dignity in this world. Similarly, I call upon the Senate finally to ratify the Genocide Convention. The United States is one of the very few countries which have not yet ratified this convention; this anomaly should be corrected at the earliest possible moment in this Congress. I am also proud of the efforts we have undertaken this past year to alleviate the plight of refugees from the far corners of the world, particularly those fleeing the troubled Indochinese peninsula. We have done a great deal to reduce suffering among these desperate people and to provide many of them with a possibility of a new home and a new start. We will continue to do our part and to encourage others to increase their financial assistance and opportunities for resettlement. I hope to cooperate closely with this Congress in the passage of new legislation which will allow us to focus YOU.S. assistance more efficiently in working toward the solution of this global, human problem. Our challenges reflect a single fact: the pressure of accelerating change in our century. We need not fear this phenomenon; indeed, we should welcome it. Change has not been merely a challenge in American history; to a very real degree, it has been our Nation's charter. We have not prospered and grown for more than two hundred years by worshipping the status quo. In building our Nation and confronting the many tasks which history has assigned us, we have found change to be our natural element. We should approach the task of building a new Foundation for a world of change with the confidence of a Nation whose strengths are unmatched. Our military forces are strong and growing stronger. Our technological and industrial capacities are unsurpassed. Our allies are strong and reliable. Our way of life, and what we stand for as a Nation, continue to have magnetic international appeal. I do not pretend that change comes without cost. I do not pretend that it comes without pain. Neither the visionary men of the 18th Century who founded our Republic, nor the citizens of conscience who opposed slavery in the 19th, nor the men and women of the 20th who led us successfully through two world wars looked upon change as easy. They did, however, look upon it as inevitable. So it was in the beginning of our country, so it has been through all the stages of our history. The future has always brought Americans to a higher level of national achievement as long as we were willing to invest the time and the energy and the imagination toward shaping that future ourselves. As we begin a new year, I repledge my Administration to time, energy, and imagination essential to build a new Foundation for a world of peace, prosperity and human justice. Together, America's Congress, its people, and its President cannot only master the many challenges of change, but make them a part of our Nation's purpose in the world. In so doing, we can bring America closer to that "more perfect union" of Jefferson's dream in a wider and more secure global community congenial to our values, interests and ideals. JIMMY CARTER. The White House, January 25, 1979.
my state of the union address was devoted to what i believe are the highest priorities facing our nation in 1979 as we seek to build a new foundation at home and abroad however my administration time and effort this year will also be focused on a significant number of other important initiatives and goals i am sending this state of the union message so that the members of the 96th congress are presented with a full picture of my basic legislative program in domestic and foreign affairs for the year over the past two years my administration has developed a very cooperative relationship with the congress that relationship not only resulted in the extraordinarily productive record of the 95th congress but will provide the foundation for a renewed sense of trust and confidence by the american people in their government we have an enviable record to match but with your help the 96th congress can meet this challenge my administration and i are eager to help in the effort our basic goals will be to continue working with you to build solid foundations for the next solid economic foundation of stable prices and continued solid foundation for a more efficient less intrusive federal solid foundation for world peace and american security foundation for progress when i took office two years ago the country faced serious domestic problems the economy had not recovered from a recession unemployment was intolerably high at with 7 million americans out of work the nation had no sound energy policy and oil imports were rising rapidly the federal government was operating inefficiently in numerous vital areas trust in the openness and integrity of the government was low major social problems were being ignored or inadequately addressed by the federal government in the ensuing two years we have tackled these problems while problems can not be solved overnight real progress has been made the economy has gross national product has increased 10 and real disposable personal income has increased the unemployment rate has decreased by 25 since my election from nearly 8 to million new jobs have been created total employment has reached a record of million a comprehensive national energy policy has been enacted and a department of energy created to help implement it the first major reform of civil service system in nearly a century was enacted 6 reorganization plans have been approved and implemented the federal paperwork burden has been reduced by 10 inspectors general are being placed in departments and agencies to help root out fraud and abuse budgeting practices have been instituted throughout the government several hundred million dollars have been saved through sound cash management reforms regulations are being written in simple english and a regulatory council has been established to develop the nation first regulatory calendar and agenda a renewed sense of confidence and faith in the government is gradually being restored domestic problems have been attacked aggressively the nation first urban policy was developed and its implementation begun the social security system was refinanced to assure its long run solvency the full employment act was passed aid to education has been expanded by 50 and a welfare reform program was developed and debated in congress and will serve as a foundation for our efforts this year to overhaul the welfare system cumbersome regulatory apparatus which deters competition in our economy was dismantled by the deregulation of the airline industry domestic policy priorities over the next year our domestic program will concentrate on further developing a new foundation for progress in each of several areas restraining inflation while continuing to pursue our employment and other economic and budgetary goals making government more efficient and effective enhancing basic human and social needs protecting and enhancing our rights and liberties and preserving and developing our natural resources inflation my administration major domestic priority is to reduce the rate of inflation while maintaining economic growth that is clearly the major domestic concern of the american people and it is the problem they are looking to us to help solve inflation places a cruel burden on the poor and on those on fixed incomes it serves as a disincentive to investment it threatens our continued economic growth and job creation this is more than an economic challenge inflation is the persistent historic enemy of a free society it saps our confidence and faith in the future it undermines our trust i am determined to meet the challenge now before us last october i announced an program which can aid significantly in the effort to reduce inflation it is a tough and responsible voluntary program throughout this year we will be working to implement our program part of the program requires new legislation and we intend to work closely with you in developing and enacting that legislation the effort to reduce inflation will be one of the most difficult battles our government has undertaken in many years but it is not a battle we can afford to lose government can not solve the problem of inflation alone but we can and must lead the way with your cooperation we can and will win the 1980 budget in announcing my program last year i made a commitment to the american people to reduce the budget deficit for fiscal year 1980 to 30 billion or less the budget i submitted to the congress honors that commitment the fy budget projects a deficit of 29 billion which is less than half the deficit the nation had when i ran for office and represents the smallest budget deficit in the last six fiscal years the fy budget has billion in projected budget outlays which is an increase of only above the previous year that is the smallest annual increase in federal spending in the last seven years the billion spending total also means that we will be meeting my goal of reducing federal spending to about 21 of gross national product one year ahead of schedule the decisions i had to make in restraining spending were difficult but if we are to succeed in breaking the back of inflation federal spending must be restrained to set an example for the private sector if there were easier solutions they would have been taken by now finally i want to emphasize that my fy budget does not neglect the basic needs of the disadvantaged the poor and the unemployed for instance the budget will provide billion in increased assistance to the poor it also will provide a total of billion for adult and youth employment and training programs which will be especially targeted to the disadvantaged and unemployed moreover there are significant increases for education programs for the disadvantaged and a new fiscal assistance program for our nation cities in short this budget is austere but it also maintains our commitment to help those in our country who most need it hospital cost containment one of my highest legislative priorities for this year is hospital cost containment it will be one of the clearest tests of the seriousness of the congress in dealing with the problem of inflation clearly the most inflationary part of health care costs in recent years has been in the hospital industry last year hospital charges grew at the rate of about 13 percent experience in several states has shown that through programs such as the one i will propose hospitals can save money and reduce costs through sound cost containment practices i expect to shortly propose hospital cost containment legislation which will build on the proposal passed last year by the senate real wage insurance i have proposed to the congress a real wage insurance program to protect employee groups that comply with the 7 voluntary wage standard against losses in purchasing power if inflation exceeds 7 if inflation exceeds 7 these employees will receive a tax refund equal to their 1979 income up to times the difference between the actual inflation rate up to 10 and 7 this program will give workers a strong economic incentive to cooperate with the voluntary pay standards i have established thereby helping to break the spiral that is at the root of the current persistent inflation this is a novel approach to the inflation problem the persistence of high inflation for the past ten years makes clear that new solutions are needed innovative approaches must be added to the arsenal if we are to break the back of inflation real wage insurance represents the type of innovative approach which is required it will provide a significant tax benefit for those working people who participate in helping to reduce the inflationary cycle but without raising taxes for anyone else my administration intends to work very closely with congress in developing and enacting a real wage insurance law voluntary pay and price standards it is vital that our program of voluntary standards succeed at stake is the reduced rate of inflation that all americans demand and deserve the cooperation of business and labor is obviously essential and we have already had clear evidence of their willingness to join in this effort i have already received assurance from over 200 of the nation largest corporations that they will comply with the standards and just recently the oil chemical and atomic workers union reached agreement on a contract with the major refineries that met the pay standards throughout this year the pay and price standards will continually be tested your cooperation in encouraging voluntary compliance can help ensure the standards success the administration will keep the congress fully informed and involved as we work to implement this program state and local governments if we are to succeed in our efforts the cooperation and active participation of state and local governments is essential we will soon announce a program which actively involves the governors mayors county executives and other local officials in a comprehensive approach to restrain inflationary pressures within their control the necessities in recent years the greatest inflationary burden on the working men and women has involved necessities of life food energy housing and medical care an effective program must involve a series of concerted attacks on the sources of rising prices in these vital sectors in each of these areas the administration has established task forces to identify existing government policies that unreasonably inflate prices and to suggest actions that can be taken at both national and local levels to combat inflation in these efforts we will work directly with congress state and local governments and consumer groups multilateral trade negotiations mtn i have already notified the congress that we expect to sign and submit for congressional approval a set of trade agreements which we will reach in the tokyo round of the multilateral trade negotiations with these agreements we expect to achieve major reductions in tariff and nontariff barriers to international trade these agreements will to increased opportunities for exports that import competition is fair and in lower prices increased competition and greater prosperity for the american people passage of the mtn will be one of my highest legislative priorities this year it is critical to the health of our domestic and of the world economy countervailing duties i have recently sent to the congress a message urging prompt passage of legislation permitting the waiver of the imposition of countervailing duties on certain imported products passage is essential to the successful completion of the multilateral trade negotiations and therefore should be one of congress highest priorities at the beginning of this session exports the united states has entered a period where export growth is essential to improve our balance of payments strengthen the dollar and thereby help reduce inflationary pressures to do this both the private sector and the federal government must place a higher priority on exports with the national export policy i announced last year we are moving to meet this need first we are working to reduce domestic barriers to exports so that exporters are not stifled by excessive governmental regulation second we are providing further incentives in the form of better export financing and better government export development programs third we are working with our trading partners in the multilateral trade negotiations to reduce foreign barriers to our exports and to secure a fairer international trading system for all exporters these actions should expand our exports in 1979 and help us move toward a reduced trade deficit although they will not cure our serious balance of trade difficulties overnight they are the first steps in an essential effort to strengthen the position in world trade while reaffirming the nation commitment to maintain an open world trading system and to resist protectionism council on wage and price stability the council on wage and price stability is playing a vital role in our efforts the council and its staff have the lead responsibility within the executive branch for implementing the voluntary wage and price standards that i have announced without the council continuing role the effort would have a very slim chance of succeeding i therefore believe it is essential that the council along with its staff operation be reauthorized early this year with the additional staff i will request to handle the enormous volume of work under my program the reauthorization should not contain amendments that interrupt or restrain the necessary work of the council or its staff employment the administration working closely with congress has made significant progress over the last two years in reducing unemployment and creating new jobs the december unemployment rate of represents almost a 25 reduction from the december 1976 rate million more people have jobs than they did before the beginning of the administration this increase exceeds the employment growth in any other period since world war ii total employment has reached an high of million over the past two years black employment is up by 12 and black teenage employment is up by adult female employment has increased by teenage employment overall has increased by 11 although progress has been made unemployment remains unacceptably high for these groups and in areas unemployment remains much too high for all workers last year which ended with the lowest unemployment rate in 3 years a framework for continued progress into the next decade was established the comprehensive employment and training act ceta was reauthorized at high levels for four more years the full employment act became law after many years of effort the administration demonstration youth programs were extended for two more years a new partnership between the government and the private sector to assist the unemployed was approved by congress with the passage of a new title 7 of private sector initiatives program the targeted jobs tax credit to encourage private employees to hire our poor young people and others who are hard to employ and an expanded tax credit for mothers on welfare in 1979 this framework will help us continue to improve the employment prospects for america workers we especially want to improve the targeting of job creation programs to those who most need these opportunities and to improve the quality of the training and employment assistance for the poor blacks hispanics youth and women we expect to achieve these goals through a number of actions first we will continue working toward achievement of the full employment act goals we will provide an average of ceta public jobs and shift many of them to the longterm or structurally unemployed we will continue to search for the most promising ways to reduce the structural unemployment that denies many the opportunity for full participation in american life second we will begin implementing the new private sector programs including establishment of private industry councils in communities throughout the country to encourage business to hire the unemployed i am proposing to congress that this effort be supported at a level of 400 million this year third we will continue our special efforts to provide jobs and training programs for young workers in cooperation with organizations and the private sector we must meet our responsibility to provide opportunities for young americans to learn to work fourth we will take steps to improve the management and delivery of employment and training services i will seek a reform of the act which authorizes the employment service to integrate that program more effectively into our employment and training system my administration will also implement the ceta amendments which establish practices and procedures to improve the quality of programs provide better management and prevent fraud and abuse making government more efficient and effective the american people are demanding a federal government which is effective and efficient for the past two years i have worked toward that goal by reorganizing and reforming the government operation and by uncovering and removing fraud waste and abuse real progress has been made but the government is still not operating as competently as i want or the american people deserve in 1979 we must build on the base of the last two years to provide our people with the type of government they deserve your help in this effort is essential we have already begun to build a new foundation of government efficiency and we will do more in the year ahead reorganization we have begun to reorganize the government through the creation of a department of energy and the changes resulting from the six reorganization plans approved by congress over the past two years those plans helped to reshape and improve the operation of the executive office of the president the international cultural and communications agencies emergency preparedness agencies the equal employment opportunity enforcement agencies the civil service commission and the administration of the employee retirement income security act i will again propose to the congress that a department of education be created this will be a very high priority of this administration education issues deserve far more attention and more accountable management than they can receive in a department as large and complex as hew the department would provide a official devoting attention to education and reporting directly to me it will also enable the federal government to be a more responsive and reliable partner with states localities and private institutions which have primary responsibility for education i will also be proposing to congress reorganization plans involving economic development and the management of our natural resources development and will intensively study possible reorganizations in the areas of surface transportation the selective service system and the alaska natural gas pipeline the natural resources and economic development reorganizations involve areas where overlap duplication and unclear authority have hamstrung our efforts reorganization here can save money and people we will be consulting closely with congress over the next several weeks before submitting these reorganization plans regulatory reform last year we took major steps toward reform of the federal regulatory system ranging from improved regulation writing to saving hundreds of millions of dollars through improved cash management techniques the dramatic reductions in airline prices that occurred when congress joined with us to lift the heavy hand of federal regulation illustrate the advantages of letting the competitive market rather than government control industry performance the public will benefit similarly through improved service increased competition and lower federal expenditures if we reform federal regulation of surface transportation i will send to congress shortly a surface transportation reform message dealing with the rail bus and trucking industries in 1978 i used my authority as chief executive to improve the management of the federal regulatory process i issued executive order 12044 setting standards to ensure that each executive branch regulatory agency facilitates public participation and avoids needless costs a regulatory analysis program was established under an regulatory analysis review group to help ensure that major new regulations are as as possible the executive order also established procedures for all executive branch agencies to conduct sunset reviews to reevaluate outdated regulations and remove them from the books wherever warranted finally i created a regulatory council composed of the executive branch regulatory agencies with voluntary participation by independent agencies to develop a calendar of all major federal regulations to be issued or proposed in 1979 the nation first regulatory calendar will be published next month and will be used to eliminate duplication overlap and inconsistent practices this year i will propose to congress a number of legislative actions that can be taken to improve the regulatory process they will include improvements in specific regulatory programs as well as a regulatory reform act so that no regulation can be issued unless it is genuinely required and unless it gets the job done with maximum efficiency and minimum paperwork costs and other burdens the quality of regulations can also be improved by providing opportunities for all interested parties to participate in regulatory proceedings public involvement should be enhanced by providing financial assistance to those whose participation is limited by their economic circumstances while many agencies have inherent authority to fund participation we will seek legislation to specifically authorize these programs while i will propose a legislative program i will continue to oppose the legislative veto this approach is unconstitutional it increases uncertainty and delay and it deflects attention from the real solutions none of our actions in this area will be taken at the expense of my deep personal commitment to protect health and safety in the environment the workplace the highway and consumer products and to prevent deception and unfairness to consumers my regulatory reform program will help make needed programs work better cost less and gain support among all sectors of our society civil service and pay reform enactment of the civil service reform act of 1978 by the 95th congress represented one of the finest examples of cooperation between the legislative and executive branches in recent times that effort showed a determination to respond to the clear public desire to improve the management of the federal bureaucracy implementation of the reform act is well under way the office of personnel management the merit system protection board and the federal labor relations authority authorized by the act have been established in addition the heads of the federal departments and agencies have moved promptly to implement the new personnel procedures that will permit a better motivated and more effective civil service however other improvements in management of the government work force are needed our white collar blue collar and military systems must be reformed in order to make certain that we neither overpay nor underpay federal employees therefore i will propose federal pay reform legislation covering each of these systems to the congress that is equitable to federal employees and the public these pay reforms are an important to our civil service reform public financing the time is long overdue for reforming the way congressional elections are financed the current flood of money threatens to pervert our electoral process we can no longer permit our elections to be open to the highest bidder the recent elections have clearly demonstrated the kinds of problems caused by uncontrolled campaign spending it is time to adopt public financing for congressional it is too late public financing operated successfully in the last presidential election and it can do the same in congressional races my administration will work with congress for passage of a sound congressional public financing law sunset my administration will again work with the congress to enact a sound sunset bill under such a bill each federal program would have to be carefully on a periodic basis to determine whether its continued existence is justified through such a procedure the american people can be assured that unnecessary government programs and agencies will be ended rather than continued through the force of inertia and other programs and agencies will be improved there are few more important to the new foundation of government efficiency we seek than passage of sunset legislation it goes to the heart of making government work lobby reform the american people have a right to know what significant influences affect their national legislature the proliferation of well financed organizational lobbying activities during recent years has demonstrated the clear need for reform of the outdated and ineffective lobby disclosure law now in effect this year my administration will continue to work with congress to pass a sound lobby law reform that respects the first amendment right of all americans and minimizes paperwork burdens yet allows meaningful disclosures waste fraud and inefficiency although the vast majority of federal employees are able honest and hardworking we need to continue to be vigilant to ensure that the taxpayers dollars are not wasted through fraud or abuse the implementation of civil service reform will lead to improvements in agency management practices and program efficiency in addition i am committed to continuing to cut excess paperwork simplify grants requirements and evaluate our programs better and more frequently we have already significantly reduced the paperwork burden and implemented many of the recommendations of the federal paperwork commission we will continue to do more in 1979 early this year i will nominate highly qualified inspectors general armed with tough new powers to prevent waste and corruption the justice department will increase its already intensive effort to prosecute those few employees and contractors who abuse the public trust in addition a new office of ethics in the office of personnel management and a special counsel in the merit system protection board will help ensure the integrity of the federal work force and protect its members from political abuse state and local government relations as the first president in more than thirty years to be elected immediately after service as a governor i have made relations with state and local government a high priority of my administration during my first two years in office we have strengthened the federal system significantly we have involved the federal regional directors in the management of the government and have reinvigorated the federal regional councils as a result the federal government is now able to respond better and more quickly to state and local needs in addition we have involved state and local officials in the development of our policies to a greater degree than any previous administration since 1977 federal to state and local governments have increased to more than 80 billion per year 25 percent above the level of aid when i first took office progress has also been made towards my goal of giving governors mayors and county officials more flexibility in managing federal programs the federal government is now taking seriously for the first time the burdens and costs we impose on state and local governments and all taxpayers when we legislate and regulate from the federal level in this time of limited budget resources we must achieve more management of federal resources and place greater reliance on the experience knowledge and ability of state and local governments in the future we must attempt to limit the imposition of new costs on state and local governments and to avoid where possible prescribing every detail of how they administer federal programs we must work together to identify specific ways in which more flexibility can be given to state city and county officials in the administration of federal programs without compromising the national purposes that each program is designed to serve transportation in 1979 we shall continue the effort begun in the 95th congress to reduce the regulatory burden on the nation transportation industry our proposals for surface transportation deregulation will build upon the principles of increased competition that have proven successful for the airline industry shortly i will propose broad legislation which begins to deregulate the railroad industry regulatory reform is a crucial first step toward revitalizing this important transportation mode in addition i will also be proposing significant reductions in the regulation of bus transportation and certain regulatory changes in the trucking area we are also committed to improving the level of safety for our transportation industry as part of this effort we intend vigorously to pursue legislation improving equipment and conditions affecting truck drivers and giving stronger enforcement authority to federal agencies my forthcoming surface transportation regulatory reform message will provide the details of these proposals finally i will propose overdue changes in the nation maritime policies we must improve the ability of our merchant marine to win a fair share of our cargo the administration will continue to support legislation to establish federal minimum standards for state automobile compensation systems systems have proven to be far more efficient in delivering benefits to the victims of automobile accidents than the current tort system and they also provide greater opportunities to coordinate and reduce overall insurance costs too great a percentage of the premiums paid by goes for the administration of the current wasteful tort liability system would save money and it deserves congressional support consumer representation my administration has developed new procedures that will set standards and assess performance for effective public representation within government agencies these procedures are designed not only to improve the delivery of government services to our citizens but also to enhance the awareness of government to the health safety and economic concerns of all consumers in 1979 we will direct adequate resources to these procedures which include complaint handling training and technical assistance for consumer organizations advocacy consumer education and information and citizen participation leaa last year i proposed legislation which would institute significant and changes in the structure and programs of the law enforcement assistance administration the leaa has the potential to improve and strengthen state and local law criminal justice programs but in its present form it has fallen far short of its potential my administration will work with the congress again this year to reform this framework which includes a national institute of justice to enable us to obtain better information and research about crime problems once the legislation is enacted we will make certain that the new agency is efficiently carrying out its mission of providing meaningful federal law enforcement assistance judgeships last year my administration worked closely with the congress to enact legislation creating the additional federal judgeships needed to reduce our court backlogs and delays as a result i will soon be nominating 152 new federal largest addition to the federal judiciary in our history some of these judges will still be serving in the next century i am determined to nominate judges of the highest quality our federal judiciary must be selected on the basis of merit i am also determined to increase the low representation on the federal bench of women blacks hispanics and other minorities these goals are within our reach if we work together cooperatively and recognize the importance our country places in the selection of these new judges judicial reform because our federal courts do not function as well as we have the right to expect my administration has made judicial reform one of its goals during 1978 congress took major steps toward alleviating the problem by increasing substantially the number of federal judges and by adopting numerous substantive and procedural reforms in the handling of bankruptcy matters other judicial reforms remain to be made some such as expanding the authority of magistrates and curtailing diversity jurisdiction were proposed to the last congress i will shortly send a message to the congress urging prompt action on these and several additional proposals designed to improve the responsiveness and efficiency of our system of justice they merit the attention and approval of the congress in addition as was indicated in my consumer message to congress the administration will continue to support reform of class action procedures reform legislation should seek to ease unnecessary burdens and costs of class actions while at the same time preventing them from being used in a harassing manner antitrust enforcement and competition free enterprise and competition protected by the antitrust laws are the central organizing principles of our economic system competition produces powerful incentives for innovation and efficiency fights inflation and enhances consumer welfare strict enforcement of our antitrust laws are critical to the health of competition and the nation economy several important strides were made last year in improving antitrust enforcement in 1978 the courts imposed over 11 million in corporate fines for antitrust violations and imprisoned 29 individuals for antitrust violations these fines and sentences are significantly larger than in past years and are consistent with my strong commitment to vigorous antitrust enforcement last year i appointed the national commission for the review of antitrust laws and procedures to suggest ways of expediting antitrust cases and making relief more effective its members have recently reported to me and we will work closely with the congress and the judicial conference to implement many of its recommendations similar progress in improving the effectiveness of antitrust enforcement can be made in the 96th congress i continue to support legislation to allow those who are injured by antitrust violations to recover damages from the antitrust violator whether the injured person is a direct or indirect purchaser under the supreme court decision in the illinois brick case only direct purchasers may recover even though they may have passed on the injury to consumers who are prevented from suing this decision undercuts state and private enforcement of the antitrust laws reduces their deterrent effect may contribute to higher prices and often allows the violator to keep his gain at the expense of the injured consumer this needed legislation would overturn that decision banking i anticipate receiving shortly the recommendations of the administration task force studying regulation q and the system of deposit interest rate controls and i expect to make recommendations based upon the task force findings my administration remains supportive of congressional action to deal with the need to halt the continuing attrition in the percentage of bank deposits subject to the reserve requirements of the federal reserve system carryover basis carryover basis was one of the most important reforms passed by congress in the tax reform act of 1976 this reform would add substantial equity to our tax laws and greater efficiency to our capital markets the carryover basis reform has the effect of ending a situation in which many of our wealthiest taxpayers could permanently escape paying income tax on their gains from inherited property unfortunately the effective date has been delayed until the end of 1979 my administration will strongly oppose any efforts to repeal this reform or further delay its implementation enhancing basic human and social needs in the years immediately preceding my administration too many of our nation basic human and social needs were being ignored or handled insensitively by the federal government over the past two years we have significantly increased funding for many of the vital programs in these areas developed new programs where needs were unaddressed targeted federal support to those individuals and areas most in need of our assistance and removed barriers that unnecessarily kept many disadvantaged citizens from obtaining aid for their most basic needs the progress over the past two years has noticeably moved us forward toward building a new foundation to solve some of the country fundamental human and social problems my administration has vastly expanded assistance in the last months in areas of employment education housing community and economic development and health care which represent an improvement for the american people the record of the past two years demonstrates that government can meet our citizens basic human and social needs in a compassionate way no longer can there be any doubt that the government is able to treat americans problems with sensitivity in the coming fiscal year budget restraints make it more difficult to expand funding significantly for many major domestic programs though some programs will be increased we will continue to make existing social programs work more effectively to reduce the waste and fraud and excess bureaucracy which drains tax dollars intended to meet basic human needs in a period of austerity efficiency is itself an act of compassion because it unlocks resources needed for health care education housing economic development and other urgent social priorities health program one of the highest goals of the 96th congress should be taking action to provide all americans with the opportunity to lead a more healthy life this opportunity has been denied to many in our country because of health care services which are unaffordable inaccessible and inefficient in addition our current system of health care is focused on the treatment of disease with too little attention being directed toward its prevention we need a national health strategy which corrects these inadequacies in the existing system some of the elements of this strategy are already in place and need only be strengthened others will require new legislation from the 96th congress national health plan and other improvements last year i outlined the principles upon which the national health plan i intend to propose will be based based on those principles the administration has been working to develop a national health plan that will enable the country to reach the goal of comprehensive universal health care coverage i remain committed to that goal the need for improved health care coverage is clear about 19 million americans have no health insurance another 65 million americans face potential bankruptcy because they lack insurance protecting them against catastrophic medical expenses the health care system is highly inflationary spending in the entire health care been rising at an annual rate of 12 these expenditures can not be successfully contained under current health delivery and financing methods which produce unnecessary hospitalization on expensive technology and inadequate preventive care health resources are unevenly distributed across the country resulting in significant gaps in vital medical services for many residents of rural and inner city areas over the next several weeks we will be consulting closely with congress and interested outside groups on the scope and nature of the plan i will propose i expect to submit a plan later in the year shortly after those consultations have been completed and i look forward to working with the congress toward a prompt enactment of that plan an essential companion to any plan must be hospital cost containment legislation as i have indicated earlier in this message i will make passage of that legislation one of my highest priorities this year our effort to control health care costs would be further strengthened by the early passage of the health planning act we must also continue to promote competition in the health care sector of the economy accordingly the fy budget expands federal support for health maintenance organizations which have demonstrated a significant potential for cost saving i will also continue to press for reforms making it easier for hmo to obtain equitable reimbursement under medicare and medicaid prevention and accessible health services more health care services alone however will not necessarily improve the health status of our if these services are affordable accessible and efficient our national health must direct more attention to health promotion and disease prevention if we are to achieve our goal of improved health status the surgeon general will present this year a major report outlining our needs in this area i will be asking for your help in carrying out many of its recommendations we have made great strides in expanding the availability of health care services to rural and urban areas in recent years through the creation of the national health service corps and the establishment of a system of community health centers if health care is to be accessible to all americans these programs must be expanded and the fy budget provides for such an expansion child health assessment i believe that our health strategy must place high priority on the health of our children accordingly i will submit a revised child health assessment program to improve the early and preventive screening diagnosis and treatment program for children under medicaid this program would cover over children who are not receiving medicaid services an additional pregnant women would become eligible for medical services prior to delivery improving the health of both the mothers and infants this should be part of a national health plan mental health based upon last year recommendations of the president commission on mental health i will be proposing comprehensive mental health legislation this year along with a mental health message a new community mental health system will make new efforts to link mental health health and social services for the chronically mentally ill to enable them to live successfully in the community and will provide new community mental health services we will emphasize efforts to provide improved recognition and treatment of mental health problems in the general health care system in addition we will increase support for mental health research to restore our mental health research capacity which the commission found had seriously eroded over the past decade the first lady has helped spearhead the administration efforts to sensitize the nation to the problems in the mental health area she will continue to work directly with me to implement the pertinent recommendations of the commission drug abuse in continuing our efforts to combat drug abuse my administration will rely on those programs and initiatives which have proven to be successful in the past year and which serve as building blocks for future programs today in the united states there are fewer heroin addicts than there were in 1975 fewer americans died of heroin overdoses in the period ending june 30 1978 than in the previous twelve months seizures of illegal drugs are at their highest level ever improved coordination and cooperation among federal agencies have resulted in a more effective drug program without major budget increases but much remains to be done and the situation remains serious in 1979 we will look more to the behavior of the individual who turns to drugs will stress financial investigations as a means of prosecuting those individuals responsible for the drug traffic and will rely heavily on enlisting foreign cooperation in the overall drug program these efforts should further our success in controlling drug abuse both in the united states and abroad drug regulation reform my administration will continue to work with the congress to overhaul our current drug regulation laws in order to assure that consumers have prompt access to safe and effective drugs food and nutrition last year we worked with the congress to enact the child nutrition amendments which revamped many of our food programs and greatly expanded the supplemental food program for women infants and children this year i will propose further legislation to strengthen these and other food programs by improving the targeting of school meal programs for the needy instituting an error sanction scheme to encourage states to reduce costly food stamp errors and eliminating the cap on food stamp expenditures these reforms will insure that additional nutrition resources are targeted to those truly in need worker health and safety we will continue to fully enforce laws protecting worker health and safety in a sensible and efficient manner there will be further efforts to eliminate frivolous and unneeded rules while concentrating greater enforcement efforts on the most dangerous and particularly the most unhealthy occupational environments more efficient management of this program will serve the interest that both labor and management have in better working conditions housing we are committed to holding down housing construction costs and eliminating unnecessary regulatory burdens so that the american consumer will have an affordable choice in the housing marketplace our efforts will be accelerated this year we have also supported introduction of the new money market certificates which have helped the housing industry by maintaining a steady supply of mortgage credit the administration has supported the provision of federal housing assistance to income people including the elderly and the handicapped during the period of 1978 through 1980 the administration will have committed resources for over one million additional units of assisted housing for income renters and homeowners this is evidence of our commitment to the goal of a decent home for every american in 1980 i am recommending units of housing for income persons the problems of providing adequate housing in rural areas is especially acute lack of available land high site development costs widespread substandard overcrowded housing and limited credit opportunities continue to plague rural areas government attempts to help are often hampered by inappropriate burdensome regulations and paperwork this year the administration will take steps to assure that federal regulations accommodate locally acceptable housing codes and that the endless paperwork inspections and processing requirements currently mandated by the three major housing agencies hud fha and va are consolidated and streamlined community development my administration remains committed to a partnership involving federal state county and local governments the private sector and community organizations the community development block grant program is a cornerstone of that partnership and i am proposing in my fy budget that it be funded at the full authorization level this will be an increase of 150 million in fy above the fy level in 1977 we developed the urban development action grant program and it has already succeeded in leveraging billion in private investment and creating or saving jobs i am proposing a continuation of the action grant program next year at the 400 million authorization level neighborhoods my administration has been devoted to the preservation of neighborhoods and the development of sound neighborhood projects this goal has been evident in the emphasis on neighborhoods in my urban policy as well as in the operation of the department of housing and urban development and other agencies last year as part of our urban policy we proposed and congress passed the livable cities and neighborhood development programs to enable neighborhood groups and organizations to rebuild their neighborhoods in addition congressional passage of the national consumer cooperative bank makes available new sources of financing and technical assistance to groups who are engaged in building cooperative enterprises to reduce costs in key consumer goods and services this year my administration and congress will receive the final report of the national commission on neighborhoods we look forward to working with the congress on many of the commission recommendations with your help we can make the federal government increasingly more responsive to the needs of neighborhood people who are working together to meet basic needs in housing and community development health care nutrition and energy conservation urban policy last year i proposed the nation first comprehensive urban policy that policy involved more than one hundred improvements in existing federal programs four new executive orders and nineteen pieces of legislation with congress cooperation thirteen of these bills passed last year i will again propose to the congress several important parts of the urban policy not adopted last year the two principal proposals are an urban fiscal assistance program and the national development bank my fiscal assistance proposal will include two principal components the first a standby countercyclical fiscal assistance program will protect state and local governments against unexpected changes in the national economy it would trigger into place if the national unemployment rate rises above percent and would provide fiscal aid to many needy governments the second component is a transitional highly targeted fiscal assistance program that provides fiscal aid to only the most local governments relatively few cities and counties will be eligible for this highly targeted program but those eligible will be truly in need i will seek a 250 million supplemental in fy and 150 million in fy for this targeted fiscal assistance program i also will propose a national development bank to provide financing for local economic development projects which will aid the revitalization of our nation communities as part of the bank i will propose a significant increase in economic development 550 million in new economic development capital grants to business and billion in new loan guarantee authority for fy this bank will be the central engine for the economic development in the government we will propose the consolidation of many economic development loan programs into the bank as part of the economic development reorganization this will add over 1 billion in additional loan authority social security changes in 1977 the congress worked with the administration to take the difficult but necessary action to make the social security system financially sound for the next fifty years in so doing we helped protect the benefits of current recipients and of those now working however the social security system from time to time needs adaptation to changing conditions so the administration this year will make proposals which will reduce somewhat the cost of the program by trimming the costs of certain benefits these proposals will be sent to the social security advisory council which is representative of the contributing employers employees and the public and to the national commission on social security appointed in part by the congress and in part by me so they can have an ample opportunity to review these proposals prior to the submission of the changes to the congress and the administration and the congress can have their recommendations if any if the administration proposals for social security outlay reductions and hospital cost containment legislation are enacted it would be possible to consider a reduction in social security taxes beginning in 1981 however such a reduction would have to be considered in light of alternative uses of such savings including reduction of any budget deficit and funding of programs beyond the immediate reforms i have proposed the administration is committed to review the entire pension system that has developed in our country i have established a pension commission to provide the type of analysis this vital area needs disability insurance reforms i will propose to congress an integrated package of reforms for the disability insurance system separate from the social security changes i have just discussed these measures will improve incentives for rehabilitation of the disabled ensure that benefits do not exceed disposable income and make administration of the system simpler and more consistent we must make certain that those who should receive benefits are not excluded but that those who are not truly disabled or can otherwise return to work do so welfare reform the nation welfare system is inequitable inefficient and long overdue for serious reform i will recommend to the congress a package consisting of reforms in cash assistance expansion of the earned income tax credit an expansion of private and public job opportunities for welfare recipients and fiscal relief for state and local governments this package will enable us to develop a welfare system that is more simple narrows the great differences in the way states help the very poor that encourages people to work and that helps eliminate the fraud and abuse currently plaguing parts of our welfare system my administration has already begun to work closely with this congress to enact welfare reform this year we must expeditiously move forward with welfare reform this year families our major social initiatives and goals for this year will be undertaken with vigor and with a commitment to the security and enhancement of the american family structure our government must never impede nor work against the american family but rather we must design programs and policies that support families and ensure that future generations of american families will thrive and prosper the white house conference on the family will continue and expedite its planning this year with that goal firmly in mind child welfare reform the nation present system of overlapping inadequate child placement programs does a great disservice to parents foster parents and children in need of homes there is too little emphasis on reunification of families and permanent placement of children the special problems of children often go unattended i will therefore again propose to congress major reforms in our foster care and adoption services and urge prompt congressional approval this problem must not be left unattended any longer older americans early in the administration we moved to correct one of the major concerns of older americans the possible bankruptcy of the social security trust funds the legislation that was enacted ensures the financial solvency of the funds through the beginning of the next century the administration has also acted to help remove discrimination against senior citizens by supporting the legislation which removed the forced retirement requirement in the federal civil service and postponed mandatory retirement in the private sector from age 65 to 70 in addition the administration worked with the congress to amend the older americans act in a way that will improve the administration of the act social and housing programs employment provisions food delivery and establishment of centers for the elderly this year the administration will continue its efforts to ensure that seniors remain in the mainstream of american life free from age discrimination and able to receive the assistance and other benefits they have earned veterans our nation has no obligation more basic than providing for those men and women who served us as members of our armed forces there are still many veterans who need medical care employment assistance and assistance in adjusting to disabilities that resulted from their service during the last two years we have made significant improvements in programs to help meet all these needs in 1979 my administration will seek legislation to increase compensation rates for disabled veterans improve education programs for the disadvantaged under the bill provide special readjustment counseling assistance for those vietnam era veterans who need them and modernize the va vocational rehabilitation program these efforts will help veterans help themselves in addition we will continue to provide quality medical care in our va hospital system by making it more efficient and thus more responsive to the needs of a changing veteran population education improving skills and educational opportunities has been one of my administration major goals to aid in this improvement i have increased the federal office of education budget authority alone by since taking 8 billion in fy to billion in the proposed fy budget the increased education funding will continue to be targeted at programs which emphasize equal education opportunity support for local schools student assistance basic skills and the linkages between school and work school districts with high concentrations of low income children have extra costs in meeting their commitment to equal educational opportunity last year i proposed concentration grants which would give supplemental payments for compensatory education programs in high poverty school districts this year i am requesting 400 million to fully fund this proposal as is stated elsewhere in this message i will continue to work with the congress to create a department of education through such a department we can make certain that education receives the attention at the federal level that it deserves higher education last year i signed into law the middle income student assistance act which extends federal student aid to middle income families facing rising college tuition costs i propose to fully fund the basic grants program and to continue funding for the other college student aid programs this year i will propose reauthorization of our omnibus higher education higher education act and the national defense education act through renewal of these acts we can help enormously to ensure the continuation of strong higher education institutions and equal educational opportunities for all students our nation owes a debt of gratitude to the historically black colleges which in the past were the only source of college education for talented blacks and which today retain a critical importance to the production of black citizens of all blacks earned their degrees at black colleges i have vowed that i would enhance the role of black colleges during my term in office i recently directed all federal agencies to utilize more fully the resources at black colleges and in my fy budget i have increased funding for howard university and asked for 120 million to fully fund the developing institutions program which strengthens colleges with high concentrations of minority students science and technology when i came into office i found federal efforts to promote basic research and development lagging i was determined to change this situation and develop a sounder scientific and technological foundation for the future basic scientific research and development is an investment in the nation future essential for all fields from health agriculture and environment to energy space and defense we are enhancing the search for the causes of disease we are undertaking research to anticipate and prevent significant environmental hazards we are increasing research in astronomy we will maintain our leadership in space science and we are pushing back the frontiers in basic research for energy defense and other critical national needs despite the severe budgetary constraints this year we will continue to increase federal support for basic research with a request for a 13 increase in outlays for fy even though federal funding for basic research is being increased i believe that the government role in demonstration and commercialization pilot projects should be more selective with greater reliance upon private sector financing we are enhancing our high technology approach to defense to counter the growth of soviet forces we have a broad energy research program that emphasizes longterm applications of solar coal geothermal biomass and alternate nuclear technologies but we will rely on industry to do its full part in the demonstration of new technologies in energy and in other fields rather than government funding of their research and development companies need more favorable investment climates better economic growth better trade prospects and sound policies about patents antitrust procurement and environmental regulation under the direction of the department of commerce we are also engaged in a major review of these aspects of technological innovation with participation of numerous individuals from various industrial sectors science and technology are playing an important part in our international relationships as well many countries especially developing countries look to america for our expertise and problem solving abilities i have proposed the establishment of a foundation for international technological cooperation fitc to foster collaborative efforts with people and institutions in developing countries these efforts will be directed to basic human needs in agriculture nutrition health energy systems and rural development science and technology also have played a critical part in the dramatic advances of our relationship with the people republic of china these scientific and technological relationships that will be built with china will be parallel to many such relationships we have established and enhanced over the years with other nations and groups of nations space last year marked the 20th anniversary of the national aeronautics and space administration the 21 st year started with the incredible success of the pioneer missions to venus this year we hope to open a new era in space with the first launch of the space shuttle under the national civil space policy i announced last fall we will remain dedicated to ensuring scientific and technological leadership in space to further that policy my budget request for fy includes funding to maintain the shuttle development and production schedule to continue space science and exploration to initiate efforts on selected areas of advanced satellite communications techniques and to enhance remote sensing activities that will bring benefits in areas such as earth resources climate weather pollution and agriculture communications last year we worked with congress to reorganize communications in the executive branch and enact legislation to strengthen public broadcasting in 1979 our priorities will include continued work with congress on the important effort to revise the communications act to take account of technological changes vigorous pursuit of the program already underway to increase minority ownership of broadcast stations through regulatory actions government loan guarantees and private loan and training programs a program to use new communications technologies to improve rural life by delivering education agricultural and medical services and by increasing the diversity of radio and tv elimination of unnecessary regulations and paperwork requirements in cooperation with the federal communications commission proposals on the role of the postal service in providing electronic mail services and participation in the world administrative radio conference to ensure that increasing demands for radio frequencies are balanced in a reasonable and flexible manner small business as a former businessman i am especially sensitive to the importance of small business in our economy and to the vital role the federal government can play in assisting small business through a number of actions over the past two years my administration has worked to help small business flourish and remain competitive under the leadership of the small business administration we have increased tax incentives significantly for small business expanded small business loan opportunities worked to increase small business exports expanded opportunities for small businesses and initiated programs to increase small business opportunities for women in addition we have begun preparations for a white house conference on small business in january of 1980 which will include local and regional conferences throughout the country this year while continuing efforts to prepare for the white house conference the administration will work closely with the congress to develop legislation to improve the operation and effectiveness of the small business administration cultural affairs over the last decade the national endowments for the arts and the humanities have made enormous progress in developing projects and materials to enhance our nation cultural life this year the endowments will continue their distinguished record of achievement i am hopeful congress will provide adequate funds for white house conferences on the arts and humanities this year we will also strengthen the programs of the international communications agency which present the diversity of american culture to the world and deepen our appreciation of other cultures protecting basic rights and liberties since taking office i have worked to protect and enhance the basic rights and liberties provided to americans under the constitution and our other laws with the cooperation of the congress we have made important progress in this area over the next year though a great deal remains to be done if our goal of ensuring equality and basic freedoms for all americans is to be realized the dream of equal opportunity remains unfulfilled i will do everything in my power to bring that dream closer to realization civil rights civil rights and equal opportunity i take no obligation of my office more seriously than that of striving to secure full civil rights and equal opportunity for all americans in the quarter century since the supreme court historic desegregation decision our nation progress in these vital areas of human rights had been significant but we have more to do i am determined to use all of my authority to resist any efforts to weaken enforcement of any of our civil rights and equal opportunity laws recent actions by some in congress to impair my administration efforts to enforce the law of the land will be forcefully opposed these laws have made our society more open to equality of opportunity than virtually any on earth and attempts to weaken them can not be tolerated or allowed to succeed my administration has taken important steps to make civil rights enforcement more effective the justice department has been diligent in its prosecution of civil rights violations the office of federal programs ofccp and the equal employment opportunity commission eeoc has been reorganized and granted increased authority the ofccp will vigorously enforce the guidelines of executive order 11246 which prohibits employment discrimination by federal contractors and requires affirmative action by these contractors in addition the eeoc will continue this year to provide an effective central mechanism to enforce compliance with our equal opportunity laws as we have done in recent cases before the supreme court my administration will continue to strongly support affirmative action programs to help bring minorities into the mainstream of american life while opposing rigid and inflexible quotas which have no place in our laws beyond existing laws however as i state elsewhere in this message we need to ratify two amendments to the constitution which will significantly clarify and enhance the liberties and rights of americans the equal rights amendment and the district of columbia voting rights amendment the equal rights amendment will provide women with equal legal status in our country we can not effectively champion human rights throughout the world until we have given to women the full rights they are entitled to as citizens we must also work to ratify the amendment that will finally give the citizens of the district of columbia the rights other americans have to elect voting representation in congress in addition we need to correct a weakness in an existing civil rights law title viii of the civil rights act of 1968 which prohibits discrimination in housing remains largely an empty promise because of the lack of an adequate enforcement mechanism i will soon propose to the congress that this problem be alleviated by providing the department of housing and urban development with cease and desist powers that department which now investigates and makes findings upon individual complaints would then be able to enjoin further discriminatory acts and to direct an appropriate remedy my administration will work with the congress to see that this proposal is given prompt and favorable consideration women one of the overriding concerns of my administration is ensuring equal opportunity for women last year we worked closely with the congress to extend the deadline for ratification of the equal rights amendment until june 30 1982 that extension will provide a greater opportunity to ensure ratification of this amendment i will continue to dedicate myself as well as the full resources of my administration to the ratification effort this is not a battle that we can afford to lose i am determined to win the opposition to the amendment can not be solidly based on an understanding of its legal effect the amendment will do nothing provide equality to more than of america population i am confident that with the active support of the members of congress from states which have not yet ratified we can achieve ratification of era i urge you to join the effort to provide women at long last with equal rights under the law my administration has championed and will continue to champion the right of women to choose their roles in society to protect those who have chosen the role of homemaker we have succeeded in enacting legislation that provides assistance for displaced homemakers and we supported the legislation that has now reduced from 20 to 10 years the marriage requirement for a former wife to claim against her husband social security entitlement we are facilitating the choice of many women to combine family and work responsibilities to accomplish this goal we supported the legislation passed to increase and employment opportunities and we supported the pregnancy disability act that outlaws employment discrimination based upon pregnancy childbirth or related conditions we are striving to improve women professional opportunities within the federal government to this end women have been appointed in senior positions in the administration including two cabinet officers about 20 of my senior appointees have been women and many of them are in areas in which no previous women had served and we have strengthened and increased our equal employment opportunity enforcement this year in addition to continuing our efforts to ratify the equal rights amendment we will work closely with the congress to enhance the economic standing of the poor minority and improving their access to housing health care and child care for those who choose to work we will expand additional opportunities this year for women business owners and will create a permanent interagency group to review and help improve the position of women business owners i will make every effort to select as many women as possible to fill the 152 new federal judgeships their in the courts can not be continued our country needs and deserves the full participation of women in our society and i am committed to taking the steps needed to ensure this partnership district of columbia my administration worked with the 95th congress to pass a proposed amendment to the constitution granting full voting representation to the citizens of our nation capital the ratification process for this proposed amendment has begun and i urge the state legislatures which have not ratified the resolution to join with the states of new jersey ohio and michigan by promptly ratifying the amendment my administration will work this year in the effort to ratify this amendment my administration will also work closely with the congress and the new district government under mayor marion barry to expand home rule for the district this includes streamlining the procedures for congressional review of locally enacted legislation removal of the federal government from the district budgetary process by 1982 developing a rational formula for determining the federal payment to the district and an equitable federal sharing of financial responsibility for funding of the district pension plan for police firemen teachers and judges i will work with mayor barry to make our nation capital city a model for the rest of the nation to emulate native americans the federal government has a special responsibility to native americans and i intend to continue to exercise this responsibility fairly and sensitively my administration will continue to seek negotiated settlements to difficult conflicts over land water and other resources and will ensure that the trust relationship and principles continue to guide indian policy there are difficult conflicts which occasionally divide indian and citizens in this country we will seek to exercise leadership to resolve these problems equitably and compassionately handicapped for americans with physical disabilities this year will result in continued improvements in their accessibility to many opportunities those of us who are not disabled take for opportunities employment opportunities and greater access to public facilities and services we will make further progress in removing obstacles that impede and discriminate against our disabled community if our nation is to remove the barriers of discrimination in our society the federal government must serve as a model in the successful removal of physical and psychological barriers thrown in the way of our nation disabled the section 504 regulations issued by the department of health education and welfare provide a basis for the federal government to lead the way in ensuring the rights of the handicapped undocumented aliens one of the most difficult and sensitive domestic issues facing the country concerns the federal government policy toward undocumented aliens i continue to believe that effective but humane measures need to be devised which will help relieve the causes and effects of the presence of large numbers of undocumented aliens in this country i will pursue this issue in my consultations with the government of mexico during my visit there next month and will make no final decisions until after those consultations martin luther king martin luther king led this nation effort to provide all its citizens with civil rights and equal opportunities his commitment to human rights peace and stands as a monument to his humanity and courage as one of our nation most outstanding leaders it is appropriate that his birthday be commemorated as a national holiday and i will strongly support legislation to achieve this minority business this year we will move vigorously to implement the strong minority business legislation enacted by congress in 1978 meet my goal of tripling federal procurement from minority businesses to a total of 3 billion faithfully implementing the minority programs of the government and improve the operation of the several programs designed to achieve equal entrepreneurial opportunity and vital minority economic development we are currently evaluating the adequacy and organization of current minority business development programs with the commitment to taking whatever action legislative or administrative is needed to ensure that their operation is efficient and effective civil liberties privacy government and private institutions collect increasingly large amounts of personal data and use them to make many crucial decisions about individuals much of this information is needed to enforce laws deliver benefits provide credit and conduct similar important services however these interests must be balanced against the individual right to privacy and against the harm that unfair uses of information can because individuals should be able to know what information organizations collect and maintain about them they should be able to correct inaccurate records and there should be limits on the disclosure of particularly sensitive personal information my administration is developing a comprehensive privacy policy to address these concerns last year legislation was enacted which established restrictions on wiretapping for intelligence purposes and on government access to financial records early in 1979 i will propose privacy legislation to cover medical financial and other sensitive personal records i will also take administrative actions to strengthen privacy controls for federal agencies records these measures will go far toward giving all american citizens the privacy protections they need in a modern society i recently announced my intention to submit legislation to congress protecting the rights of the press and others preparing materials for publication from searches and seizures undertaken without judicial approval under the legislation i will propose federal state and local law enforcement officials will generally be required to obtain a subpoena before conducting a search or seizure against those preparing materials for publication such legislation which would deal with the problems created by the supreme court decision in the stanford daily case should serve as a solid protection of the rights of the news media and others under the fourth amendment labor law reform the nation labor laws are vital to ensuring that a sound relationship exists in collective bargaining efforts to abuse those labor laws especially by unduly slowing or blocking their implementation have increased in recent years as a result a reform of our labor laws is required in order to guarantee that their intended spirit is fully observed and enforced i am again prepared to work with the congress to develop legislation which improves the fairness and effectiveness of our labor laws efforts to defeat this legislation last year were based on emotion and a lack of information about its actual effect if the will of the majority in congress is allowed to prevail we can enact sound labor law legislation export boycott my administration will work with the congress to reauthorize the export administration act which plays a vital role in ensuring that american trade serves our national interest we will make particular efforts to reauthorize that part of the act which prohibits american compliance with the foreign economic boycott of israel the amendments passed by the congress were fair and equitable and must continue to be strenuously enforced intelligence charters i will be working closely with the congress to develop and enact statutory charters for the intelligence community the charters for the first time will define in law the duties and responsibilities of our intelligence agencies and will set forth the authority of those agencies to fulfill those responsibilities the disclosures of abuses in recent years make clear the need for charters and my administration is strongly committed to developing and passing charter legislation that protects our citizens rights while permitting our intelligence agencies to perform effectively their essential duties criminal code the federal criminal laws are often archaic frequently contradictory and imprecise and clearly in need of revision and codification my administration will continue to work with the congress to develop a federal criminal code which simplifies and clarifies our criminal well as protects our basic civil liberties the criminal code which passed the senate in the last session can serve as a basis for progress this year hatch act reform we will continue to support efforts to reform the hatch act so that federal employees in positions will have the right to participate in political activities while preventing any political abuse hunger we share a growing concern with other nations and their people over the serious problem of world hunger while our government and the governments of other nations and international organizations are working to assure the basic right to food the problems of hunger and malnutrition are a daily fact of life for millions of people throughout the world in order to make our own programs more effective and to examine additional efforts that might be undertaken i have established the presidential commission on world hunger under the leadership of ambassador sol linowitz to recommend realistic solutions which we and other nations might undertake in a prompt and efficient manner the commission will report to me this year and will then be involved in the implementation of its recommendations the administration will be working closely with congress on the commission recommendation holocaust commission last year i established a holocaust commission to recommend to me how our government might officially recognize for the first time the tragedy of the holocaust the commission work is well underway and i will receive its report this year i expect to work together with congress in developing a suitable memorial to the millions who died in the holocaust preserving and developing natural resources my highest legislation priority during the 95th congress was enactment of our first national energy plan the dedication of many members of congress made that goal a reality my administration is committed to using that legislation as the foundation for further efforts to reduce our dependence on foreign oil to increase our ability to develop domestic energy sources and to conserve wasted energy our energy and other development goals can and will be reconciled with the administration resolve to clean the nation air and water and to preserve our most precious natural resources we will continue to further the protection of our environment we will continue to develop our fertile agricultural land the administration is committed to helping our nation farmers continue to achieve record yields and exports energy the administration remains committed to meeting our future energy needs building upon the framework of the national energy act signed last november we will be addressing key issues such as further developing and commercializing solar and renewable energy resources making better use of our coal reserves and other abundant energy resources continuing our emphasis on using energy more efficiently and improving the manner in which we produce and use conventional sources of energy such as oil natural gas and uranium to minimize the impacts of potential supply disruptions we will continue the storage of oil in the strategic petroleum reserve and will be submitting for congressional approval overall energy contingency plans while much remains to be done in the energy area past investments in improving our energy supplies and our energy use are beginning to pay off the rate of growth of our industrial energy use has dropped while industrial production has increased from 1975 to 1977 the growth in domestic energy consumption has been 70 of the growth in gnp previously the two growth rates had been roughly equal with significant improvements in automobile efficiency gasoline consumption is an estimated 5 lower than it otherwise would have been use of heating oil electricity and other home energy sources has become much more efficient oil consumption grew last year at a rate of only on the supply side the new natural gas legislation whose provisions have just begun to take effect will ensure new domestic production of this premium fuel and help expedite the delivery of natural gas to the interstate market furthermore due to the addition of alaska north slope oil our domestic production of oil has held steady over the last year and foreign imports were down in 1978 in 1979 and the fy budget we are continuing strong investments in energy research and development the fy 1980 budget provides outlays of billion for a wide range of programs to develop energy technologies for the future particular emphasis will be given to solar energy research and development to improvements in the mining and burning of coal fission and fusion research to improvements in existing technologies for conservation oil and gas recovery and uranium efficiency and to basic research these commitments to technologies for the future both long and shorter term are critical to a sound and comprehensive energy policy solar energy within the next few weeks i will send to the congress a message on solar energy based on an interagency study under the domestic policy review system the transition to use of solar and renewable resources can and must begin now solar wind energy and use of biomass resources can contribute significantly in both the short and long run to meeting our nation energy needs some of these technologies such as solar heat and hot water use of biomass for generation of electricity and wind energy are available now and are competing with other conventional energy sources the tax credits in the national energy act along with other commercialization incentives will help accelerate the use of solar and other renewable technologies in the residential and industrial sectors of our economy the fy 1980 budget increases our solar research and development programs by 40 over fy 1979 total expenditures for solar energy will exceed 800 million including tax credits and important initiatives undertaken by the department of energy the agency for international development the tennessee valley authority the department of agriculture and the small business administration application of solar technologies in buildings will also increase thereby providing new markets for our existing solar industry in our research and development program strong emphasis will be given to photovoltaics through which electricity can be produced directly from solar energy conversion of organic materials to useable energy forms will also receive increased funding funds for the new solar energy research institute at golden colorado will also be increased the proposals i will later announce coupled with the fy budget will chart a firm and ambitious course for accelerating the use of solar and other renewable energy sources both now and in the future the time for solar energy has come other energy research development and demonstration in the coming year significant investments will be made in the demonstration of technologies which can convert coal to more useable and environmentally acceptable energy forms continued strong research and development in fusion development of geothermal energy sources such as hot underground brines and hot rock resources and efforts to resolve a range of environmental issues which these and other technologies raise nuclear energy a wide range of administration initiatives both legislative and administrative will be proposed to ensure that this country can further use light water reactors for the generation of electricity safely and efficiently of central importance will be the development and implementation of a strong responsible program to manage and dispose of nuclear wastes as a result of the work of the interagency review group on waste management i will be making a series of legislative and administrative recommendations to ensure that the necessary schedules coordination and legislative authorities are firmly in place public discussion and participation in the nuclear waste management area along with the close cooperation of state and local elected officials will receive continued high priority legislation will also be proposed to provide interim storage for spent fuel from existing reactors until a permanent waste repository is established enactment of nuclear licensing and siting legislation to shorten the lead times required to plan locate construct and license nuclear power reactors will again be sought design and construction activities for the new centrifuge enrichment plant at portsmouth ohio will continue to ensure that the is able to meet the nuclear fuel needs of our domestic industry as well as our international customers who share our objectives these activities coupled with the administration waste management program will help ensure that our country can continue to rely on current nuclear technologies to meet power needs looking toward the future we will seek to improve the efficiency of our existing power reactors by reducing their uranium feed requirements for the longer run the administration will maintain and strengthen the strong research and development program we now have for more advanced nuclear fission technologies such as the fast breeder reactor we continue to believe that the clinch river breeder reactor project is premature technically inadequate and should not go forward but the administration is committed to keeping the breeder option open for the future domestic crude oil pricing provision of adequate incentives for both domestic production of crude oil and for conservation must be carefully weighed in light of our efforts to control inflation in consultation with the congress i will be making my decisions and recommendations on domestic crude oil pricing and related issues later this year energy impact assistance as new domestic energy resources are developed particularly in rural or isolated areas of the country provision must be made for the needs of rapidly developing communities the administration will again seek enactment of legislation establishing an inland energy assistance program with funding of 150 million per year to aid those states and local areas which are experiencing a rapid growth in population as a result of new energy supply development these communities often can not plan for or meet increased need for new public facilities or services since the population increases occur before the new energy supply activities are fully developed and producing local revenues this legislation is essential to ensure that the burdens associated with solving our energy problems are borne equitably by all citizens and regions of the country management of federal energy resources the last two congresses passed landmark legislation to reform the management of coal oil and gas resources these new laws include federal strip mine controls and amendments to the outer continental shelf lands act and the mineral leasing act with this new framework the administration is proceeding to implement swiftly new programs which will permit increased leasing and development activities while protecting our environment water policy legislation water is a basic human necessity and its proper management is essential to economic activity particularly in the arid west the policies of my administration are designed to emphasize the more efficient use of water as well as the need to provide adequate water supplies we are particularly sensitive to the interests of the west and other areas in the development of additional water resources to the importance of water conservation and to the concerns of many eastern urban areas about their water systems last year i announced a comprehensive water policy which included many reforms now being implemented administratively in addition i will propose legislation to increase the role of the states in water policy through increased water planning grants and through new grants for state water conservation programs i will also propose legislation which would provide for states to share in the costs of federal water projects this cost proposal will result in direction by states in setting water project priorities and will help insure that federal programs are responsive to the most pressing needs congressional action is also needed on administration amendments to modernize the 1902 reclamation act to ensure that acreage limitations in federally funded irrigation projects are equitable and fair environment my administration is committed to balancing the needs for development conservation and preservation of our natural resources our nation has been blessed with an outstanding natural heritage which if properly cared for can meet our needs for food and fiber mineral energy recreation and solitude in a way that is environmentally sound the congress and the administration have worked together over the past two years to achieve this goal we have enacted the first federal standards for coal we have improved and extended the clean air and glean water acts we have created a substantial number of new national parks and other protected areas during 1979 protection of alaska lands implementation of water policy resolution of wilderness and nonwilderness designations in the national forest system and reformed management of federal energy resources will be major environmental initiatives of my administration efforts to enforce and implement environmental statutes firmly and fairly to streamline environmental review requirements to protect public health and to preserve wildlife resources will continue to be pursued vigorously and as as possible alaska as in the last congress passage of legislation designating national parks wildlife refuges wilderness areas national forests and wild and scenic rivers in alaska is the highest environmental priority of my administration to protect these magnificent alaskan wild lands i took several actions after the adjournment of the 95th congress including the creation of 17 national monuments covering 56 million acres these areas as well as other outstanding parts of alaska covered in administration proposals should be protected promptly by legislation in order to assure that the great national treasures of wildlife scenery history and untouched ecosystems can be saved for our children and grandchildren while permitting appropriate commercial use of certain of the areas roadless area designations rare ii the agriculture department has released tentative recommendations and nearly completed work on a study which will lead to proposals to resolve the status of most of the remaining roadless areas in the national forest system the administration proposal will involve additional wilderness designations in many states and the release of remaining lands for nonwilderness activities this initiative will also eliminate uncertainty over land uses in most parts of the national forest system and will ensure that development uses will be adequately supported while preserving critical parts of our natural heritage in an unspoiled condition environmental protection in recent years the quality of our environment has improved but much remains to be done to clean up our air and water and to control contamination by toxic materials the environmental protection agency is focussing its efforts on the protection of public health by assessing the effects of substances before they are introduced into the environment and by ensuring that hazardous wastes are disposed of safely at the same time epa and the other health and safety agencies are exercising new care when implementing environmental regulations to avoid imposing unnecessary costs or red tape a healthy safe environment need not be incompatible with a healthy economy we are committed to both the nation investment in environment cleanup must have the incentives and the flexibility to allow our most important environmental goals to be achieved at the lowest cost unnecessary requirements which because delays and increase costs will be removed epa will simplify and consolidate its permit programs to reduce paperwork red tape and delays the agency is beginning to introduce innovations which allow firms the flexibility to find the lowest cost methods of controlling pollution i will submit legislation to consolidate federal funds for environmental programs at the state level thus giving the states more flexibility to use these funds to deal with their most pressing environmental problems these and other changes we are making will assure the american public that the money we spend on environmental controls is the best investment we can make in our future and our children future the state of food and agriculture world food security has been substantially improved in 1978 for the third consecutive year crops were harvested in most parts of the world pushing supplies to record quantities and creating the opportunity for people all over the world to improve their diets for the united states 1978 was also a year of records large food and record feed grain crops were harvested by producers the farm sector capability to lead the world in productivity but despite the record crops which placed downward pressure on prices here and abroad our farm economy became stronger in 1978 and our agricultural trade reached record levels the value of agricultural exports reached billion in fiscal percent above 1977 record the volume of our farm exports was a record 125 million metric 18 percent from 1977 agricultural trade made another record contribution to our balance of billion in fiscal 1978 exports also accounted for one out of every four dollars the farmer earned net farm income which was billion in 1977 is estimated at over 28 billion for highest on record in constant dollars this was the best year since 1975 this was achieved while we met our domestic needs fulfilled our commitments to our overseas customers and built reserves for future stability protection this recovery in agriculture has been shared by crop and livestock producers alike indeed american livestock producers can now look forward to several years of good returns to help them recover from the last four years which were marked by poor prices and forced liquidation of herds part of the recovery in the farm sector can be attributed to the programs and policies adopted by my administration and the farmers have used to improve their incomes and stabilize prices i am personally proud of the recovery our farmers have made international agricultural trade over the past 2 years this administration has worked to reduce barriers to international trade and to develop new markets and encourage increased exports of agricultural products the agricultural trade act of 1978 for example provides important new authorities for intermediate credit and the establishment of trade offices in major markets we have moved to establish new and stronger trade ties with several nations including japan and the people republic of china partly as a result of these efforts exports of farm produced goods are expected to reach a record 29 billion in fiscal percent higher than 2 years contribute 15 billion to our balance of payments unlike previous multilateral trade negotiations in the current mtn we have placed heavy emphasis on the lessening of restrictions on trade in agricultural products our efforts here should have a major impact on agriculture in the future by broadening our access to important existing and new international markets crop insurance the federal government now operates several programs to protect farmers from economic losses associated with crop failure the experience of recent years with these programs has demonstrated their many serious the breadth of coverage the equity of program benefits and the efficiency of program administration we will propose again a comprehensive nationwide insurance reform bill to the 96th congress aimed at providing fairer and more effective protection for farmers and at no additional cost to the taxpayer under this proposal several existing disaster assistance programs would be consolidated into one comprehensive program to ensure against economic losses resulting from natural disaster and other uncontrollable risks international emergency wheat reserve the cornerstone of our domestic food and agricultural policy is the farmerowned grain reserve in little more than a year we have built this into a billion bushel grain equivalent of more than a third of our stocks from the past year these stocks remain under the ownership of those farmers who produced them rather than in the hands of government or international grain traders this reserve provides a critical cushion against shocks in the market caused by production shortfalls either here or abroad we now need to establish the same sort of protection for our international food aid programs accordingly the administration will reintroduce legislation to authorize the establishment and management of an international emergency wheat reserve this reserve will provide developing countries assurance that we will be able to fulfill our food aid commitments at the same time it will protect the domestic economy from further inflationary pressures during periods of grain shortages sugar in the absence of congressional passage of a domestic sugar program in the last session the administration has taken several further steps to assure domestic producers of a fair return and consumers an assured supply at stable prices to underscore administration commitment to achieving ratification of the international sugar agreement i directed that sugar imports from countries not party to the agreement be strictly limited to the levels permitted under the agreement for 1979 we have also asked for and received an extension of the deadline for ratifying the isa to june 30 1979 in addition at the end of last year i issued a proclamation that provides for a new more flexible system of sugar import fees protecting a domestic raw sugar price of 15 cents per pound to help stabilize world sugar prices to satisfy our international commitments and to protect our domestic sugar producers my administration is committed to working with the congress to develop an effective domestic sugar program early in this session and to achieve ratification of the international sugar agreement rural development throughout 1978 my administration took steps to make existing federal rural development programs work better for many rural areas and for most rural residents the 1970 have been a period of rapid growth and development income levels have risen and large numbers of better jobs have been created in rural communities across the nation rates of population and employment growth for rural areas have been substantially greater than for urban problems of unplanned rapid growth in some areas but also reversing decades of rural and economic stagnation nevertheless rural americans still experience a disproportionate concentration of pressing human problems of all homes lacking complete plumbing are in rural areas rural infant mortality rates are 10 percent higher than urban ones 70 percent of the rural poor and half of the rural elderly have no automobile causing great hardship because of the distances to travel to get access to basic health care jobs and other social services while only a quarter of all americans live in rural areas 40 percent of the nation poor live there for too long the small town mayor the rural county official and the individual rural american have been frustrated by a maze of federal grant applications requirements eligibility standards audits and deadlines which have made it virtually impossible to address these rural problems effectively for too many years money and time has been wasted we are moving to address this chronic problem in the last year white house rural development initiatives have resulted in a commitment to build 300 rural primary health clinics to serve million americans who lacked access to care major streamlining of the rural water and sewer grant process through which five agencies distribute billion in federal funds each year the new process permits a single application single audit single funding source and single point of federal a savings to local government of several hundred million dollars each year along with a reduction in processing time of as much as 15 months and specially targeted rural job training programs for rural disadvantaged in the water and sewer and health support fields this effort to address rural problems will continue and be expanded in 1979 addressing the problems of rural transportation housing and economic development among others in addition during the year i plan to articulate a set of overall rural development principles and goals which will guide the actions of my administration these principles will provide focus direction and priority to the myriad of now separate federal actions and policies so that we can more effectively work to overcome the problems of rural isolation promote economic development meet basic human needs protect the quality of rural life assure equity in the administration of federal programs for which rural americans are eligible and build a more effective partnership among federal state local governments and the private sector in meeting locally defined rural development priorities furthermore several other administration initiatives will have an impact on the conditions in rural america we will make certain that the rural perspective is considered as initiatives are developed in such areas as welfare reform and a national health plan foreign policy priorities the continuing challenges of change when i took office two years ago this month i was convinced that america had to pursue a changed course in a world which was itself undergoing vast change in the midst of this accelerating change america choice lies between facing chaos or building with others a new foundation for a true world community our foreign policy accepts the latter responsibility both because of our basic belief and because of america critical role in the world to this end we must have four broad objectives to buttress american power on which global security and stability depend to strengthen our relations with other nations throughout the world in order to widen the spirit of international cooperation to deal constructively with pressing world problems which otherwise will disrupt and even destroy the world community we seek to assert our traditional commitment to human rights rejoining a rising tide of belief in the dignity of the individual progress towards these goals depends first on our ability as a nation to work together in the common interest during the coming year the congress the executive and the public will be addressing an unusually wide range of international issues the action taken will have an impact on our nation position in the world for many years to establishing a secure nuclear balance in developing closer relations with the world most populous nation in achieving an historic step towards peace in the middle east or in setting the pattern of trade relations during the next decade and beyond this report elaborates on my address to the congress and in particular concentrates on the issues in which the role of the congress will be most important to building a new foundation for peace in each case the challenge is clear to exercise strong american leadership with others to shape change rather than permit change to shape us america military strength elsewhere in this report i have described the domestic programs and policies required for a just united and productive america the maintenance of american military strength is an essential foundation for a successful foreign policy that safeguards our freedom our accomplishments and our friendships in a world of accelerating change fraught with potential danger and uncertainty and marked by a continuing soviet military buildup we must have together with our allies unsurpassed military capability to deter attack or attempts at political coercion moreover we must have the military force to mount an effective defense at any level of hostilities where our vital interests are jeopardized the defense budget which i have presented to the congress funds a program of prudent investments that will ensure the effectiveness of our strategic and conventional military posture it will begin development of a new more survivable ballistic missile system to enhance the icbm component of our strategic triad maintain the trident submarine and missile programs increasing the security striking power and the range of our submarine force extend the effectiveness of our bomber force with the addition of cruise missiles pursue a vigorous program of research and development in cruise missiles aircraft and other systems to ensure the continued technological superiority of america nuclear deterrent in addition the defense budget i have submitted this week will strengthen our conventional capabilities to fulfill our commitments to our major allies and friends and retain a credible military presence in both the atlantic and the pacific we will continue to add armor and firepower to our infantry and build a more modern smaller aircraft carrier which together with more frigates and destroyers will improve the effectiveness and flexibility of our surface fleet in nato we have already achieved important progress toward making the alliance more effective in the changing security environment we helped launch the alliance defense program to offset growing soviet modernization of its deployment in europe the ltdp will increase nato military capabilities through better coordination of defense efforts increased investment and more modern equipment we removed with the support of congress a serious obstacle to strengthening turkey defensive capabilities and made further progress toward the reintegration of greek armed forces into nato military structure both these efforts helped repair a serious deficiency on nato southern flank we neared final agreement with the portuguese on the renewal of our base rights in the azores the provision of adequate military as well as economic assistance to turkey portugal and other allies and friends in need will be a matter of high priority during the coming year nato strength is growing in 1979 we can further that encouraging process by standardizing more of the alliance equipment and improving allied readiness the proposal i will soon put before the 96th congress calls for the authorization of intergovernmental agreements to simplify logistical problems both in peacetime and during any period of hostilities such agreements will permit the to reinforce nato more rapidly and provide more effective defense at lower cost we also intend to maintain a vigorous american military presence in the pacific successful completion of a revised military base agreement in the philippines following ten years of negotiations provides an essential underpinning for our military capability in asia congressional authorization for the transfer of military equipment to the republic of korea was another contribution to assuring the security of korea and japan both actions unmistakably signal not only our desire to promote east asian stability but our intention to remain a concerned involved and responsible power in the pacific the essential task of improving our military posture must also be accompanied by increased efficiency i take this opportunity to thank the congress for its support last year of our actions to reduce waste and needless duplication in our defense budget vigorous efforts will continue this year in order to assure that the united states will possess strong military forces at the lowest possible cost building the community of nations military strength is essential to peace but can not alone guarantee it the system of cooperation we have with the rest of the world is part of the foundation for our own security our best hope for a safer america and a peaceful world resides in the building of closer ties with as many nations as possible the major allies throughout 1978 the north atlantic alliance and the growing partnership which links us with both western europe and japan remained at the heart of our foreign policy the cooperation we share with those whose purposes and traditions are closest to our own is strong and growing stronger through our summit meetings and through an unprecedented pattern of consultations at other levels of our governments we are working together on virtually all of today most critical issues together we are seeking to reduce the risk of nuclear confrontation we are working on ways to strengthen the common defense we are attempting to promote a peaceful transition in southern africa we are striving to resolve conflicts in the eastern mediterranean to support a just and lasting peace in the middle east and to maintain stability in the persian gulf we are contributing to a sounder international economy we are consulting on the issues that confront all our societies the problems of youth and age family and community growth and short advancing our democratic ideals at home in a time of change in each of our countries america role as host for the nato summit meeting in washington last spring and our attendance at the economic summit in bonn last summer symbolized american commitment to the strength of relations with europe and japan i look forward to meeting these and other allied leaders at the tokyo summit next june where we will continue the essential effort to deepen further the cooperation between us a wider community the changing realities of political and economic interdependence require that we strengthen our ties throughout the developing world and seek to improve relations with communist nations as well my trips to nigeria india saudi arabia iran brazil and venezuela underlined american sympathy and support for the international roles these countries are playing in the process of world change strengthened consultations with the asean nations serve the same end my trip to mexico early next month will be a part of this process mexico is important to us not only because it is a neighbor but also because it is one of the most vigorous democracies in this hemisphere and a leader in the developing world as neighbors we share an agenda of common migration economic growth and social provides an opportunity to establish a uniquely productive cooperative relationship my trip to poland and the visits of secretary vance and secretary blumenthal to hungary and romania underscore the importance we attach to better relations with the nations of eastern europe the support of the congress for our policy toward eastern europe has provided a strong foundation for building a stronger economic cultural and political process that will continue to go forward in the coming year china the arrival next week of the first leader of the people republic of china to officially visit washington will give us an early and welcome opportunity in the new year not only to cement the ties of friendship and hospitality between us but to emphasize our expectation that our relationship with china will be a constructive one it will contribute to diversity in the world and to peace and stability in asia it is not directed against the interests of any other country to fulfill the promise of this new era in relations we will require legislation and support from the congress such legislation is particularly important to facilitate continued trade and other relations with the people of taiwan through instrumentalities and to assure continued peace and prosperity there this has very high priority in our legislative program for 1979 ussr we seek better relations with both the soviet union and the people republic of china doing so is profoundly in the interests of our nation and of global security i therefore would like also to welcome president brezhnev to our country in the near future at that time we would hope to conclude an agreement curbing the strategic arms race there are other areas where our two nations can work constructively together these include a comprehensive nuclear test ban treaty limits on indian ocean deployments and on the transfer of conventional arms and restraint in areas of turbulence and tension such cooperative effort would do much to make the world a safer place for all we will never ignore soviet actions which challenge our interests we both have a responsibility to our peoples and the world to maintain a pattern of detente which is genuinely reciprocal and broadly defined dealing with world problems a true world community can not be fashioned or endure so long as the weapons of war multiply and spread so long as ancient disputes fester and the demands for justice are unmet so long as much of mankind remains impoverished and without hope as i emphasized in my state of the union address the need to curb the strategic arms race has never been more urgent it increases the risk of nuclear war it is a needless competition that draws away scarce resources we need to invest in other areas of our nation strength it undermines america security the conclusion and ratification of a satisfactory salt ii treaty with the soviet union is therefore among our top priorities it will make a major contribution to enhancing our security while keeping open our options to carry out needed modernization of our strategic forces and preserve our deterrence we will take whatever time is necessary to negotiate a sound verifiable agreement i am convinced that once the american people and congress have had a chance to examine the terms and benefits of this consider the shape of our future without will conclude it serves our vital security interests we will continue to consult the congress as we proceed this year with other important arms control negotiations on a comprehensive nuclear test ban the prevention of warfare mutual and balanced force reductions in europe and limits on the rising tide of conventional arms transfers the risks inherent in the proliferation of nuclear technology figure prominently among the dangers to the world community although we and the rest of the world still have far to go in dealing responsibly with such risks the united states took an important step last march with the adoption of the nuclear act for the first time in our history we established comprehensive legislation covering international cooperation in the nuclear field and the export of materials to build on that promising beginning throughout 1979 we need progress in the following areas both nuclear and the international nuclear fuel cycle evaluation infce a effort can help us develop a new international nuclear fuel consensus that will adequately balance energy needs with concerns we continue to believe that better alternatives exist to the commercialization of dangerous breeder reactors and we will cooperate as fully as possible with other countries in exploring those alternatives we will seek more substantial progress in the problem of managing nuclear waste and in attracting greater international support for the acceptance of nuclear safeguards i ask the senate to ratify the treaty on the iaea voluntary safeguards offer which will provide concrete proof of our belief that international safeguards do not interfere with the successful development and operation of commercial nuclear power i will call for early senate ratification of protocol i of the treaty of tlatelolco which will contribute to the lessening of nuclear dangers for our latin american neighbors the and cuba are now the only countries in our hemisphere which have not yet ratified that treaty regional conflict and tension curbing the means of war can not in itself remove the threat of war for that we must seek to resolve conflicts ease tension and build trust the urgency of this task and its importance to the united states and the world is nowhere more clear than in the middle east though there has been great progress the goal of a just and lasting settlement in that troubled part of the world still eludes us no one who has looked at middle east history can harbor any illusion about the difficulties ahead yet we have made great strides toward a final peace agreement between the two principal adversaries in the middle east the differences which they have overcome far outweigh the issues which still divide them israeli and egyptian commitment to peace will provide an indispensable step toward peace between israel and all its neighbors and foster the stability and orderly change we favor for the entire middle east region peace will permit us to strengthen our ties with the arab states in the region and enhance our relationship with israel a relationship which will always be special to us in 1979 i will count on the continued collaboration of the 96th congress on behalf of our efforts to gain and maintain peace throughout the region the support of the congress and the american people for a purposeful role in that region is particularly important in light of the tumultuous events taking place in iran since the end of the second world war the united states has maintained a close relationship with iran and it has a vital interest in iran independence and integrity the people of iran should shape their own future without foreign interference that is the policy of the government of the united states and we expect it to be the policy of all of iran neighbors africa congressional support for peace stability and orderly change are essential in other tense regions as well in southern africa we are trying to help bring about a peaceful transformation to majority rule which will avoid growing bloodshed between white and black and deeper intervention by the soviet union and cuba together with our european allies canada and african states directly concerned we are making progress toward the independence and majority rule of step that would have a positive impact on the evolution of events in rhodesia and elsewhere in southern africa we are heartened by the support of the african leaders who have worked with us in efforts to resolve the namibian and rhodesian issues congressional repeal of the byrd amendment was essential in enhancing our credibility in the effort to avoid a gathering war and further soviet and cuban gains in southern africa we will consult closely with the congress during the coming months as we seek the most constructive role we can play it will be increasingly important to maintain our position of impartiality among the parties so we can help them resolve their differences should they choose the path of peace latin america in our own hemisphere we can point with pride to the cooperative spirit which enabled us to change in mutually beneficial ways the basis of our relations with panama senate approval of the two panama canal treaties last year has improved the quality of our historic relationship not only with panama itself but with our friends in every part of latin america by that act our country helped demonstrate its ability both to protect major security interests and to deal with smaller nations with dignity and mutual respect congressional action to pass the necessary implementing legislation for these treaties before the october 1 deadline will ensure that the canal is efficiently operated during the transition to a new partnership with panama the treaties and implementing legislation like our efforts to help the people of nicaragua find an enduring democratic solution to the current crisis there are important to the future stability of central america as a whole and the strengthening of our new and mature relationship with the nations of all latin america the international economy in our daily lives we are constantly reminded of the importance of a healthy world economy to the strength of our own we see this in the wages of our workers who produce goods for export in the choice of goods for our consumers in the price of energy we must work closely with other countries to ensure that the world economy can steadily develop through growth while together we manage the use of its resources and protect our environment the focus for much of this effort during the past year was the bonn economic summit we worked out a strategy of cooperation with our partners to improve the world economic situation within the framework of those summit decisions west germany and japan have taken measures to stimulate their economies while we are giving top priority to fighting inflation our actions along with those taken by other summit participants are leading to a convergence of economic policies that will strengthen the global economy we have strengthened the dollar by working out arrangements with other countries to counter speculative disorder in currency markets since i announced my dollar stabilization measures last november we stopped the dollar decline in value against other currencies and have actually increased the dollar value by around 10 percent against several major currencies moreover we have announced a program to increase exports which will benefit american farmers and workers while further strengthening the position of the dollar we are now close to new agreements with our trading partners to establish a fairer better operating and more open framework for world trade the american people have a vital stake in congressional approval of these agreements ten million american jobs depend on our exports every third acre of our farmland produces for sales abroad twothirds of our imports are essential raw materials or goods we can not readily produce at a time of difficult strains in our own economy there is always an impulse to abandon our commitment to an open world trading system but the costs of such a course to the american people would be enormous each american family would pay more for what it buys and would have less choice in the goods available inflation would be fueled jobs would be jeopardized for protectionism against our trading partners breeds protectionism by them against us i am convinced that our economy can adapt to changing patterns of world trade in ways that protect the future of our workers we can compete effectively in the world economy the new trade agreements give us the opportunity to do so our programs of economic development assistance abroad are also an investment in our own future as well as the future of other nations our most rapidly growing markets lie in the developing world by helping the people of these countries we not only help extend their opportunities for a better life we help ourselves by demonstrating to their governments that we are concerned for the of their people we encourage their increasing cooperation with the west on a broad range of issues i therefore urge congressional approval of the funding we propose for our bilateral assistance programs and our participation in the work of the multilateral development banks and un agencies my proposal to establish a foundation of international technological cooperation reflects our recognition that scientists in many developing nations are ready to work in collaboration with our technological institutions to solve the great problems of health nutrition productivity and other aspects of economic development key commodity agreements can also help us deal with the legitimate needs and interests of the developing countries senate ratification of the international sugar agreement which we signed last year along with price support legislation will stabilize prices for that important commodity we have pledged a contribution to the international tin agreement and we will conduct negotiations on a rubber accord efforts to build a stronger international economy are directed not simply at managing economic relationships among nations but at improving the lives of individual people around the world for it is the lives of individuals which define the success or failure of our foreign policies reasserting america values america future is best secured in a world founded on decency justice and compassion the effort to make human rights a central component of our foreign policy comes from our deepest sense of ourselves as a humane and people we do not make our standards the precondition for every relationship we have with other countries yet human rights can never be far from the focus of our thinking or we violate our own best values in the year just passed some have quarrelled with the timing or the tactics of our emphasis on human rights abroad others have pointed to our own imperfect record on human rights at home yet few can dispute an important fact of this experience our concern for human rights has met with great resonance in the world at large the very term has entered the language and become imbued with an everyday familiarity that was simply unknown little more than two years ago we believe our efforts have contributed to a global awakening thousands of political prisoners have been freed in several countries torture of prisoners has been significantly reduced or eliminated and trials are more often open to the public open advocacy of human rights has occurred in nations where the concept was heretofore forbidden international organizations such as the un and the oas now have vigorous human rights commissions for the investigation and airing of human rights violations and the commission on security and cooperation in europe has helped to make human rights an institutionalized part of the international agenda on both sides of the atlantic in a number of key nations around the world democratic institutions are being strengthened as democratic values are reasserted americans can be proud of the leading role their government has played in advancing this process i now ask the congress to take action in 1979 which will further strengthen our human rights record i have signed four important human rights treaties including the convention on racial discrimination the international un covenants on economic and social rights and on political and civil rights and the convention on human rights senate ratification of these treaties will firmly align our nation with the growing forces for rule of law and human dignity in this world similarly i call upon the senate finally to ratify the genocide convention the united states is one of the very few countries which have not yet ratified this convention this anomaly should be corrected at the earliest possible moment in this congress i am also proud of the efforts we have undertaken this past year to alleviate the plight of refugees from the far corners of the world particularly those fleeing the troubled indochinese peninsula we have done a great deal to reduce suffering among these desperate people and to provide many of them with a possibility of a new home and a new start we will continue to do our part and to encourage others to increase their financial assistance and opportunities for resettlement i hope to cooperate closely with this congress in the passage of new legislation which will allow us to focus assistance more efficiently in working toward the solution of this global human problem our challenges reflect a single fact the pressure of accelerating change in our century we need not fear this phenomenon indeed we should welcome it change has not been merely a challenge in american history to a very real degree it has been our nation charter we have not prospered and grown for more than two hundred years by worshipping the status quo in building our nation and confronting the many tasks which history has assigned us we have found change to be our natural element we should approach the task of building a new foundation for a world of change with the confidence of a nation whose strengths are unmatched our military forces are strong and growing stronger our technological and industrial capacities are unsurpassed our allies are strong and reliable our way of life and what we stand for as a nation continue to have magnetic international appeal i do not pretend that change comes without cost i do not pretend that it comes without pain neither the visionary men of the 18th century who founded our republic nor the citizens of conscience who opposed slavery in the 19th nor the men and women of the 20th who led us successfully through two world wars looked upon change as easy they did however look upon it as inevitable so it was in the beginning of our country so it has been through all the stages of our history the future has always brought americans to a higher level of national achievement as long as we were willing to invest the time and the energy and the imagination toward shaping that future ourselves as we begin a new year i repledge my administration to time energy and imagination essential to build a new foundation for a world of peace prosperity and human justice together america congress its people and its president can not only master the many challenges of change but make them a part of our nation purpose in the world in so doing we can bring america closer to that more perfect union of jefferson dream in a wider and more secure global community congenial to our values interests and ideals jimmy carter the white house january 25 1979
state union address devoted believe highest priorities facing nation 1979 seek build new foundation home abroad however administration time effort year also focused significant number important initiatives goals sending state union message members 96th congress presented full picture basic legislative program domestic foreign affairs year past two years administration developed cooperative relationship congress relationship resulted extraordinarily productive record 95th congress provide foundation renewed sense trust confidence american people government enviable record match help 96th congress meet challenge administration eager help effort basic goals continue working build solid foundations next solid economic foundation stable prices continued solid foundation efficient less intrusive federal solid foundation world peace american security foundation progress took office two years ago country faced serious domestic problems economy recovered recession unemployment intolerably high 7 million americans work nation sound energy policy oil imports rising rapidly federal government operating inefficiently numerous vital areas trust openness integrity government low major social problems ignored inadequately addressed federal government ensuing two years tackled problems problems solved overnight real progress made economy gross national product increased 10 real disposable personal income increased unemployment rate decreased 25 since election nearly 8 million new jobs created total employment reached record million comprehensive national energy policy enacted department energy created help implement first major reform civil service system nearly century enacted 6 reorganization plans approved implemented federal paperwork burden reduced 10 inspectors general placed departments agencies help root fraud abuse budgeting practices instituted throughout government several hundred million dollars saved sound cash management reforms regulations written simple english regulatory council established develop nation first regulatory calendar agenda renewed sense confidence faith government gradually restored domestic problems attacked aggressively nation first urban policy developed implementation begun social security system refinanced assure long run solvency full employment act passed aid education expanded 50 welfare reform program developed debated congress serve foundation efforts year overhaul welfare system cumbersome regulatory apparatus deters competition economy dismantled deregulation airline industry domestic policy priorities next year domestic program concentrate developing new foundation progress several areas restraining inflation continuing pursue employment economic budgetary goals making government efficient effective enhancing basic human social needs protecting enhancing rights liberties preserving developing natural resources inflation administration major domestic priority reduce rate inflation maintaining economic growth clearly major domestic concern american people problem looking us help solve inflation places cruel burden poor fixed incomes serves disincentive investment threatens continued economic growth job creation economic challenge inflation persistent historic enemy free society saps confidence faith future undermines trust determined meet challenge us last october announced program aid significantly effort reduce inflation tough responsible voluntary program throughout year working implement program part program requires new legislation intend work closely developing enacting legislation effort reduce inflation one difficult battles government undertaken many years battle afford lose government solve problem inflation alone must lead way cooperation win 1980 budget announcing program last year made commitment american people reduce budget deficit fiscal year 1980 30 billion less budget submitted congress honors commitment fy budget projects deficit 29 billion less half deficit nation ran office represents smallest budget deficit last six fiscal years fy budget billion projected budget outlays increase previous year smallest annual increase federal spending last seven years billion spending total also means meeting goal reducing federal spending 21 gross national product one year ahead schedule decisions make restraining spending difficult succeed breaking back inflation federal spending must restrained set example private sector easier solutions would taken finally want emphasize fy budget neglect basic needs disadvantaged poor unemployed instance budget provide billion increased assistance poor also provide total billion adult youth employment training programs especially targeted disadvantaged unemployed moreover significant increases education programs disadvantaged new fiscal assistance program nation cities short budget austere also maintains commitment help country need hospital cost containment one highest legislative priorities year hospital cost containment one clearest tests seriousness congress dealing problem inflation clearly inflationary part health care costs recent years hospital industry last year hospital charges grew rate 13 percent experience several states shown programs one propose hospitals save money reduce costs sound cost containment practices expect shortly propose hospital cost containment legislation build proposal passed last year senate real wage insurance proposed congress real wage insurance program protect employee groups comply 7 voluntary wage standard losses purchasing power inflation exceeds 7 inflation exceeds 7 employees receive tax refund equal 1979 income times difference actual inflation rate 10 7 program give workers strong economic incentive cooperate voluntary pay standards established thereby helping break spiral root current persistent inflation novel approach inflation problem persistence high inflation past ten years makes clear new solutions needed innovative approaches must added arsenal break back inflation real wage insurance represents type innovative approach required provide significant tax benefit working people participate helping reduce inflationary cycle without raising taxes anyone else administration intends work closely congress developing enacting real wage insurance law voluntary pay price standards vital program voluntary standards succeed stake reduced rate inflation americans demand deserve cooperation business labor obviously essential already clear evidence willingness join effort already received assurance 200 nation largest corporations comply standards recently oil chemical atomic workers union reached agreement contract major refineries met pay standards throughout year pay price standards continually tested cooperation encouraging voluntary compliance help ensure standards success administration keep congress fully informed involved work implement program state local governments succeed efforts cooperation active participation state local governments essential soon announce program actively involves governors mayors county executives local officials comprehensive approach restrain inflationary pressures within control necessities recent years greatest inflationary burden working men women involved necessities life food energy housing medical care effective program must involve series concerted attacks sources rising prices vital sectors areas administration established task forces identify existing government policies unreasonably inflate prices suggest actions taken national local levels combat inflation efforts work directly congress state local governments consumer groups multilateral trade negotiations mtn already notified congress expect sign submit congressional approval set trade agreements reach tokyo round multilateral trade negotiations agreements expect achieve major reductions tariff nontariff barriers international trade agreements increased opportunities exports import competition fair lower prices increased competition greater prosperity american people passage mtn one highest legislative priorities year critical health domestic world economy countervailing duties recently sent congress message urging prompt passage legislation permitting waiver imposition countervailing duties certain imported products passage essential successful completion multilateral trade negotiations therefore one congress highest priorities beginning session exports united states entered period export growth essential improve balance payments strengthen dollar thereby help reduce inflationary pressures private sector federal government must place higher priority exports national export policy announced last year moving meet need first working reduce domestic barriers exports exporters stifled excessive governmental regulation second providing incentives form better export financing better government export development programs third working trading partners multilateral trade negotiations reduce foreign barriers exports secure fairer international trading system exporters actions expand exports 1979 help us move toward reduced trade deficit although cure serious balance trade difficulties overnight first steps essential effort strengthen position world trade reaffirming nation commitment maintain open world trading system resist protectionism council wage price stability council wage price stability playing vital role efforts council staff lead responsibility within executive branch implementing voluntary wage price standards announced without council continuing role effort would slim chance succeeding therefore believe essential council along staff operation reauthorized early year additional staff request handle enormous volume work program reauthorization contain amendments interrupt restrain necessary work council staff employment administration working closely congress made significant progress last two years reducing unemployment creating new jobs december unemployment rate represents almost 25 reduction december 1976 rate million people jobs beginning administration increase exceeds employment growth period since world war ii total employment reached high million past two years black employment 12 black teenage employment adult female employment increased teenage employment overall increased 11 although progress made unemployment remains unacceptably high groups areas unemployment remains much high workers last year ended lowest unemployment rate 3 years framework continued progress next decade established comprehensive employment training act ceta reauthorized high levels four years full employment act became law many years effort administration demonstration youth programs extended two years new partnership government private sector assist unemployed approved congress passage new title 7 private sector initiatives program targeted jobs tax credit encourage private employees hire poor young people others hard employ expanded tax credit mothers welfare 1979 framework help us continue improve employment prospects america workers especially want improve targeting job creation programs need opportunities improve quality training employment assistance poor blacks hispanics youth women expect achieve goals number actions first continue working toward achievement full employment act goals provide average ceta public jobs shift many longterm structurally unemployed continue search promising ways reduce structural unemployment denies many opportunity full participation american life second begin implementing new private sector programs including establishment private industry councils communities throughout country encourage business hire unemployed proposing congress effort supported level 400 million year third continue special efforts provide jobs training programs young workers cooperation organizations private sector must meet responsibility provide opportunities young americans learn work fourth take steps improve management delivery employment training services seek reform act authorizes employment service integrate program effectively employment training system administration also implement ceta amendments establish practices procedures improve quality programs provide better management prevent fraud abuse making government efficient effective american people demanding federal government effective efficient past two years worked toward goal reorganizing reforming government operation uncovering removing fraud waste abuse real progress made government still operating competently want american people deserve 1979 must build base last two years provide people type government deserve help effort essential already begun build new foundation government efficiency year ahead reorganization begun reorganize government creation department energy changes resulting six reorganization plans approved congress past two years plans helped reshape improve operation executive office president international cultural communications agencies emergency preparedness agencies equal employment opportunity enforcement agencies civil service commission administration employee retirement income security act propose congress department education created high priority administration education issues deserve far attention accountable management receive department large complex hew department would provide official devoting attention education reporting directly also enable federal government responsive reliable partner states localities private institutions primary responsibility education also proposing congress reorganization plans involving economic development management natural resources development intensively study possible reorganizations areas surface transportation selective service system alaska natural gas pipeline natural resources economic development reorganizations involve areas overlap duplication unclear authority hamstrung efforts reorganization save money people consulting closely congress next several weeks submitting reorganization plans regulatory reform last year took major steps toward reform federal regulatory system ranging improved regulation writing saving hundreds millions dollars improved cash management techniques dramatic reductions airline prices occurred congress joined us lift heavy hand federal regulation illustrate advantages letting competitive market rather government control industry performance public benefit similarly improved service increased competition lower federal expenditures reform federal regulation surface transportation send congress shortly surface transportation reform message dealing rail bus trucking industries 1978 used authority chief executive improve management federal regulatory process issued executive order 12044 setting standards ensure executive branch regulatory agency facilitates public participation avoids needless costs regulatory analysis program established regulatory analysis review group help ensure major new regulations possible executive order also established procedures executive branch agencies conduct sunset reviews reevaluate outdated regulations remove books wherever warranted finally created regulatory council composed executive branch regulatory agencies voluntary participation independent agencies develop calendar major federal regulations issued proposed 1979 nation first regulatory calendar published next month used eliminate duplication overlap inconsistent practices year propose congress number legislative actions taken improve regulatory process include improvements specific regulatory programs well regulatory reform act regulation issued unless genuinely required unless gets job done maximum efficiency minimum paperwork costs burdens quality regulations also improved providing opportunities interested parties participate regulatory proceedings public involvement enhanced providing financial assistance whose participation limited economic circumstances many agencies inherent authority fund participation seek legislation specifically authorize programs propose legislative program continue oppose legislative veto approach unconstitutional increases uncertainty delay deflects attention real solutions none actions area taken expense deep personal commitment protect health safety environment workplace highway consumer products prevent deception unfairness consumers regulatory reform program help make needed programs work better cost less gain support among sectors society civil service pay reform enactment civil service reform act 1978 95th congress represented one finest examples cooperation legislative executive branches recent times effort showed determination respond clear public desire improve management federal bureaucracy implementation reform act well way office personnel management merit system protection board federal labor relations authority authorized act established addition heads federal departments agencies moved promptly implement new personnel procedures permit better motivated effective civil service however improvements management government work force needed white collar blue collar military systems must reformed order make certain neither overpay underpay federal employees therefore propose federal pay reform legislation covering systems congress equitable federal employees public pay reforms important civil service reform public financing time long overdue reforming way congressional elections financed current flood money threatens pervert electoral process longer permit elections open highest bidder recent elections clearly demonstrated kinds problems caused uncontrolled campaign spending time adopt public financing congressional late public financing operated successfully last presidential election congressional races administration work congress passage sound congressional public financing law sunset administration work congress enact sound sunset bill bill federal program would carefully periodic basis determine whether continued existence justified procedure american people assured unnecessary government programs agencies ended rather continued force inertia programs agencies improved important new foundation government efficiency seek passage sunset legislation goes heart making government work lobby reform american people right know significant influences affect national legislature proliferation well financed organizational lobbying activities recent years demonstrated clear need reform outdated ineffective lobby disclosure law effect year administration continue work congress pass sound lobby law reform respects first amendment right americans minimizes paperwork burdens yet allows meaningful disclosures waste fraud inefficiency although vast majority federal employees able honest hardworking need continue vigilant ensure taxpayers dollars wasted fraud abuse implementation civil service reform lead improvements agency management practices program efficiency addition committed continuing cut excess paperwork simplify grants requirements evaluate programs better frequently already significantly reduced paperwork burden implemented many recommendations federal paperwork commission continue 1979 early year nominate highly qualified inspectors general armed tough new powers prevent waste corruption justice department increase already intensive effort prosecute employees contractors abuse public trust addition new office ethics office personnel management special counsel merit system protection board help ensure integrity federal work force protect members political abuse state local government relations first president thirty years elected immediately service governor made relations state local government high priority administration first two years office strengthened federal system significantly involved federal regional directors management government reinvigorated federal regional councils result federal government able respond better quickly state local needs addition involved state local officials development policies greater degree previous administration since 1977 federal state local governments increased 80 billion per year 25 percent level aid first took office progress also made towards goal giving governors mayors county officials flexibility managing federal programs federal government taking seriously first time burdens costs impose state local governments taxpayers legislate regulate federal level time limited budget resources must achieve management federal resources place greater reliance experience knowledge ability state local governments future must attempt limit imposition new costs state local governments avoid possible prescribing every detail administer federal programs must work together identify specific ways flexibility given state city county officials administration federal programs without compromising national purposes program designed serve transportation 1979 shall continue effort begun 95th congress reduce regulatory burden nation transportation industry proposals surface transportation deregulation build upon principles increased competition proven successful airline industry shortly propose broad legislation begins deregulate railroad industry regulatory reform crucial first step toward revitalizing important transportation mode addition also proposing significant reductions regulation bus transportation certain regulatory changes trucking area also committed improving level safety transportation industry part effort intend vigorously pursue legislation improving equipment conditions affecting truck drivers giving stronger enforcement authority federal agencies forthcoming surface transportation regulatory reform message provide details proposals finally propose overdue changes nation maritime policies must improve ability merchant marine win fair share cargo administration continue support legislation establish federal minimum standards state automobile compensation systems systems proven far efficient delivering benefits victims automobile accidents current tort system also provide greater opportunities coordinate reduce overall insurance costs great percentage premiums paid goes administration current wasteful tort liability system would save money deserves congressional support consumer representation administration developed new procedures set standards assess performance effective public representation within government agencies procedures designed improve delivery government services citizens also enhance awareness government health safety economic concerns consumers 1979 direct adequate resources procedures include complaint handling training technical assistance consumer organizations advocacy consumer education information citizen participation leaa last year proposed legislation would institute significant changes structure programs law enforcement assistance administration leaa potential improve strengthen state local law criminal justice programs present form fallen far short potential administration work congress year reform framework includes national institute justice enable us obtain better information research crime problems legislation enacted make certain new agency efficiently carrying mission providing meaningful federal law enforcement assistance judgeships last year administration worked closely congress enact legislation creating additional federal judgeships needed reduce court backlogs delays result soon nominating 152 new federal largest addition federal judiciary history judges still serving next century determined nominate judges highest quality federal judiciary must selected basis merit also determined increase low representation federal bench women blacks hispanics minorities goals within reach work together cooperatively recognize importance country places selection new judges judicial reform federal courts function well right expect administration made judicial reform one goals 1978 congress took major steps toward alleviating problem increasing substantially number federal judges adopting numerous substantive procedural reforms handling bankruptcy matters judicial reforms remain made expanding authority magistrates curtailing diversity jurisdiction proposed last congress shortly send message congress urging prompt action several additional proposals designed improve responsiveness efficiency system justice merit attention approval congress addition indicated consumer message congress administration continue support reform class action procedures reform legislation seek ease unnecessary burdens costs class actions time preventing used harassing manner antitrust enforcement competition free enterprise competition protected antitrust laws central organizing principles economic system competition produces powerful incentives innovation efficiency fights inflation enhances consumer welfare strict enforcement antitrust laws critical health competition nation economy several important strides made last year improving antitrust enforcement 1978 courts imposed 11 million corporate fines antitrust violations imprisoned 29 individuals antitrust violations fines sentences significantly larger past years consistent strong commitment vigorous antitrust enforcement last year appointed national commission review antitrust laws procedures suggest ways expediting antitrust cases making relief effective members recently reported work closely congress judicial conference implement many recommendations similar progress improving effectiveness antitrust enforcement made 96th congress continue support legislation allow injured antitrust violations recover damages antitrust violator whether injured person direct indirect purchaser supreme court decision illinois brick case direct purchasers may recover even though may passed injury consumers prevented suing decision undercuts state private enforcement antitrust laws reduces deterrent effect may contribute higher prices often allows violator keep gain expense injured consumer needed legislation would overturn decision banking anticipate receiving shortly recommendations administration task force studying regulation q system deposit interest rate controls expect make recommendations based upon task force findings administration remains supportive congressional action deal need halt continuing attrition percentage bank deposits subject reserve requirements federal reserve system carryover basis carryover basis one important reforms passed congress tax reform act 1976 reform would add substantial equity tax laws greater efficiency capital markets carryover basis reform effect ending situation many wealthiest taxpayers could permanently escape paying income tax gains inherited property unfortunately effective date delayed end 1979 administration strongly oppose efforts repeal reform delay implementation enhancing basic human social needs years immediately preceding administration many nation basic human social needs ignored handled insensitively federal government past two years significantly increased funding many vital programs areas developed new programs needs unaddressed targeted federal support individuals areas need assistance removed barriers unnecessarily kept many disadvantaged citizens obtaining aid basic needs progress past two years noticeably moved us forward toward building new foundation solve country fundamental human social problems administration vastly expanded assistance last months areas employment education housing community economic development health care represent improvement american people record past two years demonstrates government meet citizens basic human social needs compassionate way longer doubt government able treat americans problems sensitivity coming fiscal year budget restraints make difficult expand funding significantly many major domestic programs though programs increased continue make existing social programs work effectively reduce waste fraud excess bureaucracy drains tax dollars intended meet basic human needs period austerity efficiency act compassion unlocks resources needed health care education housing economic development urgent social priorities health program one highest goals 96th congress taking action provide americans opportunity lead healthy life opportunity denied many country health care services unaffordable inaccessible inefficient addition current system health care focused treatment disease little attention directed toward prevention need national health strategy corrects inadequacies existing system elements strategy already place need strengthened others require new legislation 96th congress national health plan improvements last year outlined principles upon national health plan intend propose based based principles administration working develop national health plan enable country reach goal comprehensive universal health care coverage remain committed goal need improved health care coverage clear 19 million americans health insurance another 65 million americans face potential bankruptcy lack insurance protecting catastrophic medical expenses health care system highly inflationary spending entire health care rising annual rate 12 expenditures successfully contained current health delivery financing methods produce unnecessary hospitalization expensive technology inadequate preventive care health resources unevenly distributed across country resulting significant gaps vital medical services many residents rural inner city areas next several weeks consulting closely congress interested outside groups scope nature plan propose expect submit plan later year shortly consultations completed look forward working congress toward prompt enactment plan essential companion plan must hospital cost containment legislation indicated earlier message make passage legislation one highest priorities year effort control health care costs would strengthened early passage health planning act must also continue promote competition health care sector economy accordingly fy budget expands federal support health maintenance organizations demonstrated significant potential cost saving also continue press reforms making easier hmo obtain equitable reimbursement medicare medicaid prevention accessible health services health care services alone however necessarily improve health status services affordable accessible efficient national health must direct attention health promotion disease prevention achieve goal improved health status surgeon general present year major report outlining needs area asking help carrying many recommendations made great strides expanding availability health care services rural urban areas recent years creation national health service corps establishment system community health centers health care accessible americans programs must expanded fy budget provides expansion child health assessment believe health strategy must place high priority health children accordingly submit revised child health assessment program improve early preventive screening diagnosis treatment program children medicaid program would cover children receiving medicaid services additional pregnant women would become eligible medical services prior delivery improving health mothers infants part national health plan mental health based upon last year recommendations president commission mental health proposing comprehensive mental health legislation year along mental health message new community mental health system make new efforts link mental health health social services chronically mentally ill enable live successfully community provide new community mental health services emphasize efforts provide improved recognition treatment mental health problems general health care system addition increase support mental health research restore mental health research capacity commission found seriously eroded past decade first lady helped spearhead administration efforts sensitize nation problems mental health area continue work directly implement pertinent recommendations commission drug abuse continuing efforts combat drug abuse administration rely programs initiatives proven successful past year serve building blocks future programs today united states fewer heroin addicts 1975 fewer americans died heroin overdoses period ending june 30 1978 previous twelve months seizures illegal drugs highest level ever improved coordination cooperation among federal agencies resulted effective drug program without major budget increases much remains done situation remains serious 1979 look behavior individual turns drugs stress financial investigations means prosecuting individuals responsible drug traffic rely heavily enlisting foreign cooperation overall drug program efforts success controlling drug abuse united states abroad drug regulation reform administration continue work congress overhaul current drug regulation laws order assure consumers prompt access safe effective drugs food nutrition last year worked congress enact child nutrition amendments revamped many food programs greatly expanded supplemental food program women infants children year propose legislation strengthen food programs improving targeting school meal programs needy instituting error sanction scheme encourage states reduce costly food stamp errors eliminating cap food stamp expenditures reforms insure additional nutrition resources targeted truly need worker health safety continue fully enforce laws protecting worker health safety sensible efficient manner efforts eliminate frivolous unneeded rules concentrating greater enforcement efforts dangerous particularly unhealthy occupational environments efficient management program serve interest labor management better working conditions housing committed holding housing construction costs eliminating unnecessary regulatory burdens american consumer affordable choice housing marketplace efforts accelerated year also supported introduction new money market certificates helped housing industry maintaining steady supply mortgage credit administration supported provision federal housing assistance income people including elderly handicapped period 1978 1980 administration committed resources one million additional units assisted housing income renters homeowners evidence commitment goal decent home every american 1980 recommending units housing income persons problems providing adequate housing rural areas especially acute lack available land high site development costs widespread substandard overcrowded housing limited credit opportunities continue plague rural areas government attempts help often hampered inappropriate burdensome regulations paperwork year administration take steps assure federal regulations accommodate locally acceptable housing codes endless paperwork inspections processing requirements currently mandated three major housing agencies hud fha va consolidated streamlined community development administration remains committed partnership involving federal state county local governments private sector community organizations community development block grant program cornerstone partnership proposing fy budget funded full authorization level increase 150 million fy fy level 1977 developed urban development action grant program already succeeded leveraging billion private investment creating saving jobs proposing continuation action grant program next year 400 million authorization level neighborhoods administration devoted preservation neighborhoods development sound neighborhood projects goal evident emphasis neighborhoods urban policy well operation department housing urban development agencies last year part urban policy proposed congress passed livable cities neighborhood development programs enable neighborhood groups organizations rebuild neighborhoods addition congressional passage national consumer cooperative bank makes available new sources financing technical assistance groups engaged building cooperative enterprises reduce costs key consumer goods services year administration congress receive final report national commission neighborhoods look forward working congress many commission recommendations help make federal government increasingly responsive needs neighborhood people working together meet basic needs housing community development health care nutrition energy conservation urban policy last year proposed nation first comprehensive urban policy policy involved one hundred improvements existing federal programs four new executive orders nineteen pieces legislation congress cooperation thirteen bills passed last year propose congress several important parts urban policy adopted last year two principal proposals urban fiscal assistance program national development bank fiscal assistance proposal include two principal components first standby countercyclical fiscal assistance program protect state local governments unexpected changes national economy would trigger place national unemployment rate rises percent would provide fiscal aid many needy governments second component transitional highly targeted fiscal assistance program provides fiscal aid local governments relatively cities counties eligible highly targeted program eligible truly need seek 250 million supplemental fy 150 million fy targeted fiscal assistance program also propose national development bank provide financing local economic development projects aid revitalization nation communities part bank propose significant increase economic development 550 million new economic development capital grants business billion new loan guarantee authority fy bank central engine economic development government propose consolidation many economic development loan programs bank part economic development reorganization add 1 billion additional loan authority social security changes 1977 congress worked administration take difficult necessary action make social security system financially sound next fifty years helped protect benefits current recipients working however social security system time time needs adaptation changing conditions administration year make proposals reduce somewhat cost program trimming costs certain benefits proposals sent social security advisory council representative contributing employers employees public national commission social security appointed part congress part ample opportunity review proposals prior submission changes congress administration congress recommendations administration proposals social security outlay reductions hospital cost containment legislation enacted would possible consider reduction social security taxes beginning 1981 however reduction would considered light alternative uses savings including reduction budget deficit funding programs beyond immediate reforms proposed administration committed review entire pension system developed country established pension commission provide type analysis vital area needs disability insurance reforms propose congress integrated package reforms disability insurance system separate social security changes discussed measures improve incentives rehabilitation disabled ensure benefits exceed disposable income make administration system simpler consistent must make certain receive benefits excluded truly disabled otherwise return work welfare reform nation welfare system inequitable inefficient long overdue serious reform recommend congress package consisting reforms cash assistance expansion earned income tax credit expansion private public job opportunities welfare recipients fiscal relief state local governments package enable us develop welfare system simple narrows great differences way states help poor encourages people work helps eliminate fraud abuse currently plaguing parts welfare system administration already begun work closely congress enact welfare reform year must expeditiously move forward welfare reform year families major social initiatives goals year undertaken vigor commitment security enhancement american family structure government must never impede work american family rather must design programs policies support families ensure future generations american families thrive prosper white house conference family continue expedite planning year goal firmly mind child welfare reform nation present system overlapping inadequate child placement programs great disservice parents foster parents children need homes little emphasis reunification families permanent placement children special problems children often go unattended therefore propose congress major reforms foster care adoption services urge prompt congressional approval problem must left unattended longer older americans early administration moved correct one major concerns older americans possible bankruptcy social security trust funds legislation enacted ensures financial solvency funds beginning next century administration also acted help remove discrimination senior citizens supporting legislation removed forced retirement requirement federal civil service postponed mandatory retirement private sector age 65 70 addition administration worked congress amend older americans act way improve administration act social housing programs employment provisions food delivery establishment centers elderly year administration continue efforts ensure seniors remain mainstream american life free age discrimination able receive assistance benefits earned veterans nation obligation basic providing men women served us members armed forces still many veterans need medical care employment assistance assistance adjusting disabilities resulted service last two years made significant improvements programs help meet needs 1979 administration seek legislation increase compensation rates disabled veterans improve education programs disadvantaged bill provide special readjustment counseling assistance vietnam era veterans need modernize va vocational rehabilitation program efforts help veterans help addition continue provide quality medical care va hospital system making efficient thus responsive needs changing veteran population education improving skills educational opportunities one administration major goals aid improvement increased federal office education budget authority alone since taking 8 billion fy billion proposed fy budget increased education funding continue targeted programs emphasize equal education opportunity support local schools student assistance basic skills linkages school work school districts high concentrations low income children extra costs meeting commitment equal educational opportunity last year proposed concentration grants would give supplemental payments compensatory education programs high poverty school districts year requesting 400 million fully fund proposal stated elsewhere message continue work congress create department education department make certain education receives attention federal level deserves higher education last year signed law middle income student assistance act extends federal student aid middle income families facing rising college tuition costs propose fully fund basic grants program continue funding college student aid programs year propose reauthorization omnibus higher education higher education act national defense education act renewal acts help enormously ensure continuation strong higher education institutions equal educational opportunities students nation owes debt gratitude historically black colleges past source college education talented blacks today retain critical importance production black citizens blacks earned degrees black colleges vowed would enhance role black colleges term office recently directed federal agencies utilize fully resources black colleges fy budget increased funding howard university asked 120 million fully fund developing institutions program strengthens colleges high concentrations minority students science technology came office found federal efforts promote basic research development lagging determined change situation develop sounder scientific technological foundation future basic scientific research development investment nation future essential fields health agriculture environment energy space defense enhancing search causes disease undertaking research anticipate prevent significant environmental hazards increasing research astronomy maintain leadership space science pushing back frontiers basic research energy defense critical national needs despite severe budgetary constraints year continue increase federal support basic research request 13 increase outlays fy even though federal funding basic research increased believe government role demonstration commercialization pilot projects selective greater reliance upon private sector financing enhancing high technology approach defense counter growth soviet forces broad energy research program emphasizes longterm applications solar coal geothermal biomass alternate nuclear technologies rely industry full part demonstration new technologies energy fields rather government funding research development companies need favorable investment climates better economic growth better trade prospects sound policies patents antitrust procurement environmental regulation direction department commerce also engaged major review aspects technological innovation participation numerous individuals various industrial sectors science technology playing important part international relationships well many countries especially developing countries look america expertise problem solving abilities proposed establishment foundation international technological cooperation fitc foster collaborative efforts people institutions developing countries efforts directed basic human needs agriculture nutrition health energy systems rural development science technology also played critical part dramatic advances relationship people republic china scientific technological relationships built china parallel many relationships established enhanced years nations groups nations space last year marked 20th anniversary national aeronautics space administration 21 st year started incredible success pioneer missions venus year hope open new era space first launch space shuttle national civil space policy announced last fall remain dedicated ensuring scientific technological leadership space policy budget request fy includes funding maintain shuttle development production schedule continue space science exploration initiate efforts selected areas advanced satellite communications techniques enhance remote sensing activities bring benefits areas earth resources climate weather pollution agriculture communications last year worked congress reorganize communications executive branch enact legislation strengthen public broadcasting 1979 priorities include continued work congress important effort revise communications act take account technological changes vigorous pursuit program already underway increase minority ownership broadcast stations regulatory actions government loan guarantees private loan training programs program use new communications technologies improve rural life delivering education agricultural medical services increasing diversity radio tv elimination unnecessary regulations paperwork requirements cooperation federal communications commission proposals role postal service providing electronic mail services participation world administrative radio conference ensure increasing demands radio frequencies balanced reasonable flexible manner small business former businessman especially sensitive importance small business economy vital role federal government play assisting small business number actions past two years administration worked help small business flourish remain competitive leadership small business administration increased tax incentives significantly small business expanded small business loan opportunities worked increase small business exports expanded opportunities small businesses initiated programs increase small business opportunities women addition begun preparations white house conference small business january 1980 include local regional conferences throughout country year continuing efforts prepare white house conference administration work closely congress develop legislation improve operation effectiveness small business administration cultural affairs last decade national endowments arts humanities made enormous progress developing projects materials enhance nation cultural life year endowments continue distinguished record achievement hopeful congress provide adequate funds white house conferences arts humanities year also strengthen programs international communications agency present diversity american culture world deepen appreciation cultures protecting basic rights liberties since taking office worked protect enhance basic rights liberties provided americans constitution laws cooperation congress made important progress area next year though great deal remains done goal ensuring equality basic freedoms americans realized dream equal opportunity remains unfulfilled everything power bring dream closer realization civil rights civil rights equal opportunity take obligation office seriously striving secure full civil rights equal opportunity americans quarter century since supreme court historic desegregation decision nation progress vital areas human rights significant determined use authority resist efforts weaken enforcement civil rights equal opportunity laws recent actions congress impair administration efforts enforce law land forcefully opposed laws made society open equality opportunity virtually earth attempts weaken tolerated allowed succeed administration taken important steps make civil rights enforcement effective justice department diligent prosecution civil rights violations office federal programs ofccp equal employment opportunity commission eeoc reorganized granted increased authority ofccp vigorously enforce guidelines executive order 11246 prohibits employment discrimination federal contractors requires affirmative action contractors addition eeoc continue year provide effective central mechanism enforce compliance equal opportunity laws done recent cases supreme court administration continue strongly support affirmative action programs help bring minorities mainstream american life opposing rigid inflexible quotas place laws beyond existing laws however state elsewhere message need ratify two amendments constitution significantly clarify enhance liberties rights americans equal rights amendment district columbia voting rights amendment equal rights amendment provide women equal legal status country effectively champion human rights throughout world given women full rights entitled citizens must also work ratify amendment finally give citizens district columbia rights americans elect voting representation congress addition need correct weakness existing civil rights law title viii civil rights act 1968 prohibits discrimination housing remains largely empty promise lack adequate enforcement mechanism soon propose congress problem alleviated providing department housing urban development cease desist powers department investigates makes findings upon individual complaints would able enjoin discriminatory acts direct appropriate remedy administration work congress see proposal given prompt favorable consideration women one overriding concerns administration ensuring equal opportunity women last year worked closely congress extend deadline ratification equal rights amendment june 30 1982 extension provide greater opportunity ensure ratification amendment continue dedicate well full resources administration ratification effort battle afford lose determined win opposition amendment solidly based understanding legal effect amendment nothing provide equality america population confident active support members congress states yet ratified achieve ratification era urge join effort provide women long last equal rights law administration championed continue champion right women choose roles society protect chosen role homemaker succeeded enacting legislation provides assistance displaced homemakers supported legislation reduced 20 10 years marriage requirement former wife claim husband social security entitlement facilitating choice many women combine family work responsibilities accomplish goal supported legislation passed increase employment opportunities supported pregnancy disability act outlaws employment discrimination based upon pregnancy childbirth related conditions striving improve women professional opportunities within federal government end women appointed senior positions administration including two cabinet officers 20 senior appointees women many areas previous women served strengthened increased equal employment opportunity enforcement year addition continuing efforts ratify equal rights amendment work closely congress enhance economic standing poor minority improving access housing health care child care choose work expand additional opportunities year women business owners create permanent interagency group review help improve position women business owners make every effort select many women possible fill 152 new federal judgeships courts continued country needs deserves full participation women society committed taking steps needed ensure partnership district columbia administration worked 95th congress pass proposed amendment constitution granting full voting representation citizens nation capital ratification process proposed amendment begun urge state legislatures ratified resolution join states new jersey ohio michigan promptly ratifying amendment administration work year effort ratify amendment administration also work closely congress new district government mayor marion barry expand home rule district includes streamlining procedures congressional review locally enacted legislation removal federal government district budgetary process 1982 developing rational formula determining federal payment district equitable federal sharing financial responsibility funding district pension plan police firemen teachers judges work mayor barry make nation capital city model rest nation emulate native americans federal government special responsibility native americans intend continue exercise responsibility fairly sensitively administration continue seek negotiated settlements difficult conflicts land water resources ensure trust relationship principles continue guide indian policy difficult conflicts occasionally divide indian citizens country seek exercise leadership resolve problems equitably compassionately handicapped americans physical disabilities year result continued improvements accessibility many opportunities us disabled take opportunities employment opportunities greater access public facilities services make progress removing obstacles impede discriminate disabled community nation remove barriers discrimination society federal government must serve model successful removal physical psychological barriers thrown way nation disabled section 504 regulations issued department health education welfare provide basis federal government lead way ensuring rights handicapped undocumented aliens one difficult sensitive domestic issues facing country concerns federal government policy toward undocumented aliens continue believe effective humane measures need devised help relieve causes effects presence large numbers undocumented aliens country pursue issue consultations government mexico visit next month make final decisions consultations martin luther king martin luther king led nation effort provide citizens civil rights equal opportunities commitment human rights peace stands monument humanity courage one nation outstanding leaders appropriate birthday commemorated national holiday strongly support legislation achieve minority business year move vigorously implement strong minority business legislation enacted congress 1978 meet goal tripling federal procurement minority businesses total 3 billion faithfully implementing minority programs government improve operation several programs designed achieve equal entrepreneurial opportunity vital minority economic development currently evaluating adequacy organization current minority business development programs commitment taking whatever action legislative administrative needed ensure operation efficient effective civil liberties privacy government private institutions collect increasingly large amounts personal data use make many crucial decisions individuals much information needed enforce laws deliver benefits provide credit conduct similar important services however interests must balanced individual right privacy harm unfair uses information individuals able know information organizations collect maintain able correct inaccurate records limits disclosure particularly sensitive personal information administration developing comprehensive privacy policy address concerns last year legislation enacted established restrictions wiretapping intelligence purposes government access financial records early 1979 propose privacy legislation cover medical financial sensitive personal records also take administrative actions strengthen privacy controls federal agencies records measures go far toward giving american citizens privacy protections need modern society recently announced intention submit legislation congress protecting rights press others preparing materials publication searches seizures undertaken without judicial approval legislation propose federal state local law enforcement officials generally required obtain subpoena conducting search seizure preparing materials publication legislation would deal problems created supreme court decision stanford daily case serve solid protection rights news media others fourth amendment labor law reform nation labor laws vital ensuring sound relationship exists collective bargaining efforts abuse labor laws especially unduly slowing blocking implementation increased recent years result reform labor laws required order guarantee intended spirit fully observed enforced prepared work congress develop legislation improves fairness effectiveness labor laws efforts defeat legislation last year based emotion lack information actual effect majority congress allowed prevail enact sound labor law legislation export boycott administration work congress reauthorize export administration act plays vital role ensuring american trade serves national interest make particular efforts reauthorize part act prohibits american compliance foreign economic boycott israel amendments passed congress fair equitable must continue strenuously enforced intelligence charters working closely congress develop enact statutory charters intelligence community charters first time define law duties responsibilities intelligence agencies set forth authority agencies fulfill responsibilities disclosures abuses recent years make clear need charters administration strongly committed developing passing charter legislation protects citizens rights permitting intelligence agencies perform effectively essential duties criminal code federal criminal laws often archaic frequently contradictory imprecise clearly need revision codification administration continue work congress develop federal criminal code simplifies clarifies criminal well protects basic civil liberties criminal code passed senate last session serve basis progress year hatch act reform continue support efforts reform hatch act federal employees positions right participate political activities preventing political abuse hunger share growing concern nations people serious problem world hunger government governments nations international organizations working assure basic right food problems hunger malnutrition daily fact life millions people throughout world order make programs effective examine additional efforts might undertaken established presidential commission world hunger leadership ambassador sol linowitz recommend realistic solutions nations might undertake prompt efficient manner commission report year involved implementation recommendations administration working closely congress commission recommendation holocaust commission last year established holocaust commission recommend government might officially recognize first time tragedy holocaust commission work well underway receive report year expect work together congress developing suitable memorial millions died holocaust preserving developing natural resources highest legislation priority 95th congress enactment first national energy plan dedication many members congress made goal reality administration committed using legislation foundation efforts reduce dependence foreign oil increase ability develop domestic energy sources conserve wasted energy energy development goals reconciled administration resolve clean nation air water preserve precious natural resources continue protection environment continue develop fertile agricultural land administration committed helping nation farmers continue achieve record yields exports energy administration remains committed meeting future energy needs building upon framework national energy act signed last november addressing key issues developing commercializing solar renewable energy resources making better use coal reserves abundant energy resources continuing emphasis using energy efficiently improving manner produce use conventional sources energy oil natural gas uranium minimize impacts potential supply disruptions continue storage oil strategic petroleum reserve submitting congressional approval overall energy contingency plans much remains done energy area past investments improving energy supplies energy use beginning pay rate growth industrial energy use dropped industrial production increased 1975 1977 growth domestic energy consumption 70 growth gnp previously two growth rates roughly equal significant improvements automobile efficiency gasoline consumption estimated 5 lower otherwise would use heating oil electricity home energy sources become much efficient oil consumption grew last year rate supply side new natural gas legislation whose provisions begun take effect ensure new domestic production premium fuel help expedite delivery natural gas interstate market furthermore due addition alaska north slope oil domestic production oil held steady last year foreign imports 1978 1979 fy budget continuing strong investments energy research development fy 1980 budget provides outlays billion wide range programs develop energy technologies future particular emphasis given solar energy research development improvements mining burning coal fission fusion research improvements existing technologies conservation oil gas recovery uranium efficiency basic research commitments technologies future long shorter term critical sound comprehensive energy policy solar energy within next weeks send congress message solar energy based interagency study domestic policy review system transition use solar renewable resources must begin solar wind energy use biomass resources contribute significantly short long run meeting nation energy needs technologies solar heat hot water use biomass generation electricity wind energy available competing conventional energy sources tax credits national energy act along commercialization incentives help accelerate use solar renewable technologies residential industrial sectors economy fy 1980 budget increases solar research development programs 40 fy 1979 total expenditures solar energy exceed 800 million including tax credits important initiatives undertaken department energy agency international development tennessee valley authority department agriculture small business administration application solar technologies buildings also increase thereby providing new markets existing solar industry research development program strong emphasis given photovoltaics electricity produced directly solar energy conversion organic materials useable energy forms also receive increased funding funds new solar energy research institute golden colorado also increased proposals later announce coupled fy budget chart firm ambitious course accelerating use solar renewable energy sources future time solar energy come energy research development demonstration coming year significant investments made demonstration technologies convert coal useable environmentally acceptable energy forms continued strong research development fusion development geothermal energy sources hot underground brines hot rock resources efforts resolve range environmental issues technologies raise nuclear energy wide range administration initiatives legislative administrative proposed ensure country use light water reactors generation electricity safely efficiently central importance development implementation strong responsible program manage dispose nuclear wastes result work interagency review group waste management making series legislative administrative recommendations ensure necessary schedules coordination legislative authorities firmly place public discussion participation nuclear waste management area along close cooperation state local elected officials receive continued high priority legislation also proposed provide interim storage spent fuel existing reactors permanent waste repository established enactment nuclear licensing siting legislation shorten lead times required plan locate construct license nuclear power reactors sought design construction activities new centrifuge enrichment plant portsmouth ohio continue ensure able meet nuclear fuel needs domestic industry well international customers share objectives activities coupled administration waste management program help ensure country continue rely current nuclear technologies meet power needs looking toward future seek improve efficiency existing power reactors reducing uranium feed requirements longer run administration maintain strengthen strong research development program advanced nuclear fission technologies fast breeder reactor continue believe clinch river breeder reactor project premature technically inadequate go forward administration committed keeping breeder option open future domestic crude oil pricing provision adequate incentives domestic production crude oil conservation must carefully weighed light efforts control inflation consultation congress making decisions recommendations domestic crude oil pricing related issues later year energy impact assistance new domestic energy resources developed particularly rural isolated areas country provision must made needs rapidly developing communities administration seek enactment legislation establishing inland energy assistance program funding 150 million per year aid states local areas experiencing rapid growth population result new energy supply development communities often plan meet increased need new public facilities services since population increases occur new energy supply activities fully developed producing local revenues legislation essential ensure burdens associated solving energy problems borne equitably citizens regions country management federal energy resources last two congresses passed landmark legislation reform management coal oil gas resources new laws include federal strip mine controls amendments outer continental shelf lands act mineral leasing act new framework administration proceeding implement swiftly new programs permit increased leasing development activities protecting environment water policy legislation water basic human necessity proper management essential economic activity particularly arid west policies administration designed emphasize efficient use water well need provide adequate water supplies particularly sensitive interests west areas development additional water resources importance water conservation concerns many eastern urban areas water systems last year announced comprehensive water policy included many reforms implemented administratively addition propose legislation increase role states water policy increased water planning grants new grants state water conservation programs also propose legislation would provide states share costs federal water projects cost proposal result direction states setting water project priorities help insure federal programs responsive pressing needs congressional action also needed administration amendments modernize 1902 reclamation act ensure acreage limitations federally funded irrigation projects equitable fair environment administration committed balancing needs development conservation preservation natural resources nation blessed outstanding natural heritage properly cared meet needs food fiber mineral energy recreation solitude way environmentally sound congress administration worked together past two years achieve goal enacted first federal standards coal improved extended clean air glean water acts created substantial number new national parks protected areas 1979 protection alaska lands implementation water policy resolution wilderness nonwilderness designations national forest system reformed management federal energy resources major environmental initiatives administration efforts enforce implement environmental statutes firmly fairly streamline environmental review requirements protect public health preserve wildlife resources continue pursued vigorously possible alaska last congress passage legislation designating national parks wildlife refuges wilderness areas national forests wild scenic rivers alaska highest environmental priority administration protect magnificent alaskan wild lands took several actions adjournment 95th congress including creation 17 national monuments covering 56 million acres areas well outstanding parts alaska covered administration proposals protected promptly legislation order assure great national treasures wildlife scenery history untouched ecosystems saved children grandchildren permitting appropriate commercial use certain areas roadless area designations rare ii agriculture department released tentative recommendations nearly completed work study lead proposals resolve status remaining roadless areas national forest system administration proposal involve additional wilderness designations many states release remaining lands nonwilderness activities initiative also eliminate uncertainty land uses parts national forest system ensure development uses adequately supported preserving critical parts natural heritage unspoiled condition environmental protection recent years quality environment improved much remains done clean air water control contamination toxic materials environmental protection agency focussing efforts protection public health assessing effects substances introduced environment ensuring hazardous wastes disposed safely time epa health safety agencies exercising new care implementing environmental regulations avoid imposing unnecessary costs red tape healthy safe environment need incompatible healthy economy committed nation investment environment cleanup must incentives flexibility allow important environmental goals achieved lowest cost unnecessary requirements delays increase costs removed epa simplify consolidate permit programs reduce paperwork red tape delays agency beginning introduce innovations allow firms flexibility find lowest cost methods controlling pollution submit legislation consolidate federal funds environmental programs state level thus giving states flexibility use funds deal pressing environmental problems changes making assure american public money spend environmental controls best investment make future children future state food agriculture world food security substantially improved 1978 third consecutive year crops harvested parts world pushing supplies record quantities creating opportunity people world improve diets united states 1978 also year records large food record feed grain crops harvested producers farm sector capability lead world productivity despite record crops placed downward pressure prices abroad farm economy became stronger 1978 agricultural trade reached record levels value agricultural exports reached billion fiscal percent 1977 record volume farm exports record 125 million metric 18 percent 1977 agricultural trade made another record contribution balance billion fiscal 1978 exports also accounted one every four dollars farmer earned net farm income billion 1977 estimated 28 billion highest record constant dollars best year since 1975 achieved met domestic needs fulfilled commitments overseas customers built reserves future stability protection recovery agriculture shared crop livestock producers alike indeed american livestock producers look forward several years good returns help recover last four years marked poor prices forced liquidation herds part recovery farm sector attributed programs policies adopted administration farmers used improve incomes stabilize prices personally proud recovery farmers made international agricultural trade past 2 years administration worked reduce barriers international trade develop new markets encourage increased exports agricultural products agricultural trade act 1978 example provides important new authorities intermediate credit establishment trade offices major markets moved establish new stronger trade ties several nations including japan people republic china partly result efforts exports farm produced goods expected reach record 29 billion fiscal percent higher 2 years contribute 15 billion balance payments unlike previous multilateral trade negotiations current mtn placed heavy emphasis lessening restrictions trade agricultural products efforts major impact agriculture future broadening access important existing new international markets crop insurance federal government operates several programs protect farmers economic losses associated crop failure experience recent years programs demonstrated many serious breadth coverage equity program benefits efficiency program administration propose comprehensive nationwide insurance reform bill 96th congress aimed providing fairer effective protection farmers additional cost taxpayer proposal several existing disaster assistance programs would consolidated one comprehensive program ensure economic losses resulting natural disaster uncontrollable risks international emergency wheat reserve cornerstone domestic food agricultural policy farmerowned grain reserve little year built billion bushel grain equivalent third stocks past year stocks remain ownership farmers produced rather hands government international grain traders reserve provides critical cushion shocks market caused production shortfalls either abroad need establish sort protection international food aid programs accordingly administration reintroduce legislation authorize establishment management international emergency wheat reserve reserve provide developing countries assurance able fulfill food aid commitments time protect domestic economy inflationary pressures periods grain shortages sugar absence congressional passage domestic sugar program last session administration taken several steps assure domestic producers fair return consumers assured supply stable prices underscore administration commitment achieving ratification international sugar agreement directed sugar imports countries party agreement strictly limited levels permitted agreement 1979 also asked received extension deadline ratifying isa june 30 1979 addition end last year issued proclamation provides new flexible system sugar import fees protecting domestic raw sugar price 15 cents per pound help stabilize world sugar prices satisfy international commitments protect domestic sugar producers administration committed working congress develop effective domestic sugar program early session achieve ratification international sugar agreement rural development throughout 1978 administration took steps make existing federal rural development programs work better many rural areas rural residents 1970 period rapid growth development income levels risen large numbers better jobs created rural communities across nation rates population employment growth rural areas substantially greater urban problems unplanned rapid growth areas also reversing decades rural economic stagnation nevertheless rural americans still experience disproportionate concentration pressing human problems homes lacking complete plumbing rural areas rural infant mortality rates 10 percent higher urban ones 70 percent rural poor half rural elderly automobile causing great hardship distances travel get access basic health care jobs social services quarter americans live rural areas 40 percent nation poor live long small town mayor rural county official individual rural american frustrated maze federal grant applications requirements eligibility standards audits deadlines made virtually impossible address rural problems effectively many years money time wasted moving address chronic problem last year white house rural development initiatives resulted commitment build 300 rural primary health clinics serve million americans lacked access care major streamlining rural water sewer grant process five agencies distribute billion federal funds year new process permits single application single audit single funding source single point federal savings local government several hundred million dollars year along reduction processing time much 15 months specially targeted rural job training programs rural disadvantaged water sewer health support fields effort address rural problems continue expanded 1979 addressing problems rural transportation housing economic development among others addition year plan articulate set overall rural development principles goals guide actions administration principles provide focus direction priority myriad separate federal actions policies effectively work overcome problems rural isolation promote economic development meet basic human needs protect quality rural life assure equity administration federal programs rural americans eligible build effective partnership among federal state local governments private sector meeting locally defined rural development priorities furthermore several administration initiatives impact conditions rural america make certain rural perspective considered initiatives developed areas welfare reform national health plan foreign policy priorities continuing challenges change took office two years ago month convinced america pursue changed course world undergoing vast change midst accelerating change america choice lies facing chaos building others new foundation true world community foreign policy accepts latter responsibility basic belief america critical role world end must four broad objectives buttress american power global security stability depend strengthen relations nations throughout world order widen spirit international cooperation deal constructively pressing world problems otherwise disrupt even destroy world community seek assert traditional commitment human rights rejoining rising tide belief dignity individual progress towards goals depends first ability nation work together common interest coming year congress executive public addressing unusually wide range international issues action taken impact nation position world many years establishing secure nuclear balance developing closer relations world populous nation achieving historic step towards peace middle east setting pattern trade relations next decade beyond report elaborates address congress particular concentrates issues role congress important building new foundation peace case challenge clear exercise strong american leadership others shape change rather permit change shape us america military strength elsewhere report described domestic programs policies required united productive america maintenance american military strength essential foundation successful foreign policy safeguards freedom accomplishments friendships world accelerating change fraught potential danger uncertainty marked continuing soviet military buildup must together allies unsurpassed military capability deter attack attempts political coercion moreover must military force mount effective defense level hostilities vital interests jeopardized defense budget presented congress funds program prudent investments ensure effectiveness strategic conventional military posture begin development new survivable ballistic missile system enhance icbm component strategic triad maintain trident submarine missile programs increasing security striking power range submarine force extend effectiveness bomber force addition cruise missiles pursue vigorous program research development cruise missiles aircraft systems ensure continued technological superiority america nuclear deterrent addition defense budget submitted week strengthen conventional capabilities fulfill commitments major allies friends retain credible military presence atlantic pacific continue add armor firepower infantry build modern smaller aircraft carrier together frigates destroyers improve effectiveness flexibility surface fleet nato already achieved important progress toward making alliance effective changing security environment helped launch alliance defense program offset growing soviet modernization deployment europe ltdp increase nato military capabilities better coordination defense efforts increased investment modern equipment removed support congress serious obstacle strengthening turkey defensive capabilities made progress toward reintegration greek armed forces nato military structure efforts helped repair serious deficiency nato southern flank neared final agreement portuguese renewal base rights azores provision adequate military well economic assistance turkey portugal allies friends need matter high priority coming year nato strength growing 1979 encouraging process standardizing alliance equipment improving allied readiness proposal soon put 96th congress calls authorization intergovernmental agreements simplify logistical problems peacetime period hostilities agreements permit reinforce nato rapidly provide effective defense lower cost also intend maintain vigorous american military presence pacific successful completion revised military base agreement philippines following ten years negotiations provides essential underpinning military capability asia congressional authorization transfer military equipment republic korea another contribution assuring security korea japan actions unmistakably signal desire promote east asian stability intention remain concerned involved responsible power pacific essential task improving military posture must also accompanied increased efficiency take opportunity thank congress support last year actions reduce waste needless duplication defense budget vigorous efforts continue year order assure united states possess strong military forces lowest possible cost building community nations military strength essential peace alone guarantee system cooperation rest world part foundation security best hope safer america peaceful world resides building closer ties many nations possible major allies throughout 1978 north atlantic alliance growing partnership links us western europe japan remained heart foreign policy cooperation share whose purposes traditions closest strong growing stronger summit meetings unprecedented pattern consultations levels governments working together virtually today critical issues together seeking reduce risk nuclear confrontation working ways strengthen common defense attempting promote peaceful transition southern africa striving resolve conflicts eastern mediterranean support lasting peace middle east maintain stability persian gulf contributing sounder international economy consulting issues confront societies problems youth age family community growth short advancing democratic ideals home time change countries america role host nato summit meeting washington last spring attendance economic summit bonn last summer symbolized american commitment strength relations europe japan look forward meeting allied leaders tokyo summit next june continue essential effort deepen cooperation us wider community changing realities political economic interdependence require strengthen ties throughout developing world seek improve relations communist nations well trips nigeria india saudi arabia iran brazil venezuela underlined american sympathy support international roles countries playing process world change strengthened consultations asean nations serve end trip mexico early next month part process mexico important us neighbor also one vigorous democracies hemisphere leader developing world neighbors share agenda common migration economic growth social provides opportunity establish uniquely productive cooperative relationship trip poland visits secretary vance secretary blumenthal hungary romania underscore importance attach better relations nations eastern europe support congress policy toward eastern europe provided strong foundation building stronger economic cultural political process continue go forward coming year china arrival next week first leader people republic china officially visit washington give us early welcome opportunity new year cement ties friendship hospitality us emphasize expectation relationship china constructive one contribute diversity world peace stability asia directed interests country fulfill promise new era relations require legislation support congress legislation particularly important facilitate continued trade relations people taiwan instrumentalities assure continued peace prosperity high priority legislative program 1979 ussr seek better relations soviet union people republic china profoundly interests nation global security therefore would like also welcome president brezhnev country near future time would hope conclude agreement curbing strategic arms race areas two nations work constructively together include comprehensive nuclear test ban treaty limits indian ocean deployments transfer conventional arms restraint areas turbulence tension cooperative effort would much make world safer place never ignore soviet actions challenge interests responsibility peoples world maintain pattern detente genuinely reciprocal broadly defined dealing world problems true world community fashioned endure long weapons war multiply spread long ancient disputes fester demands justice unmet long much mankind remains impoverished without hope emphasized state union address need curb strategic arms race never urgent increases risk nuclear war needless competition draws away scarce resources need invest areas nation strength undermines america security conclusion ratification satisfactory salt ii treaty soviet union therefore among top priorities make major contribution enhancing security keeping open options carry needed modernization strategic forces preserve deterrence take whatever time necessary negotiate sound verifiable agreement convinced american people congress chance examine terms benefits consider shape future without conclude serves vital security interests continue consult congress proceed year important arms control negotiations comprehensive nuclear test ban prevention warfare mutual balanced force reductions europe limits rising tide conventional arms transfers risks inherent proliferation nuclear technology figure prominently among dangers world community although rest world still far go dealing responsibly risks united states took important step last march adoption nuclear act first time history established comprehensive legislation covering international cooperation nuclear field export materials build promising beginning throughout 1979 need progress following areas nuclear international nuclear fuel cycle evaluation infce effort help us develop new international nuclear fuel consensus adequately balance energy needs concerns continue believe better alternatives exist commercialization dangerous breeder reactors cooperate fully possible countries exploring alternatives seek substantial progress problem managing nuclear waste attracting greater international support acceptance nuclear safeguards ask senate ratify treaty iaea voluntary safeguards offer provide concrete proof belief international safeguards interfere successful development operation commercial nuclear power call early senate ratification protocol treaty tlatelolco contribute lessening nuclear dangers latin american neighbors cuba countries hemisphere yet ratified treaty regional conflict tension curbing means war remove threat war must seek resolve conflicts ease tension build trust urgency task importance united states world nowhere clear middle east though great progress goal lasting settlement troubled part world still eludes us one looked middle east history harbor illusion difficulties ahead yet made great strides toward final peace agreement two principal adversaries middle east differences overcome far outweigh issues still divide israeli egyptian commitment peace provide indispensable step toward peace israel neighbors foster stability orderly change favor entire middle east region peace permit us strengthen ties arab states region enhance relationship israel relationship always special us 1979 count continued collaboration 96th congress behalf efforts gain maintain peace throughout region support congress american people purposeful role region particularly important light tumultuous events taking place iran since end second world war united states maintained close relationship iran vital interest iran independence integrity people iran shape future without foreign interference policy government united states expect policy iran neighbors africa congressional support peace stability orderly change essential tense regions well southern africa trying help bring peaceful transformation majority rule avoid growing bloodshed white black deeper intervention soviet union cuba together european allies canada african states directly concerned making progress toward independence majority rule step would positive impact evolution events rhodesia elsewhere southern africa heartened support african leaders worked us efforts resolve namibian rhodesian issues congressional repeal byrd amendment essential enhancing credibility effort avoid gathering war soviet cuban gains southern africa consult closely congress coming months seek constructive role play increasingly important maintain position impartiality among parties help resolve differences choose path peace latin america hemisphere point pride cooperative spirit enabled us change mutually beneficial ways basis relations panama senate approval two panama canal treaties last year improved quality historic relationship panama friends every part latin america act country helped demonstrate ability protect major security interests deal smaller nations dignity mutual respect congressional action pass necessary implementing legislation treaties october 1 deadline ensure canal efficiently operated transition new partnership panama treaties implementing legislation like efforts help people nicaragua find enduring democratic solution current crisis important future stability central america whole strengthening new mature relationship nations latin america international economy daily lives constantly reminded importance healthy world economy strength see wages workers produce goods export choice goods consumers price energy must work closely countries ensure world economy steadily develop growth together manage use resources protect environment focus much effort past year bonn economic summit worked strategy cooperation partners improve world economic situation within framework summit decisions west germany japan taken measures stimulate economies giving top priority fighting inflation actions along taken summit participants leading convergence economic policies strengthen global economy strengthened dollar working arrangements countries counter speculative disorder currency markets since announced dollar stabilization measures last november stopped dollar decline value currencies actually increased dollar value around 10 percent several major currencies moreover announced program increase exports benefit american farmers workers strengthening position dollar close new agreements trading partners establish fairer better operating open framework world trade american people vital stake congressional approval agreements ten million american jobs depend exports every third acre farmland produces sales abroad twothirds imports essential raw materials goods readily produce time difficult strains economy always impulse abandon commitment open world trading system costs course american people would enormous american family would pay buys would less choice goods available inflation would fueled jobs would jeopardized protectionism trading partners breeds protectionism us convinced economy adapt changing patterns world trade ways protect future workers compete effectively world economy new trade agreements give us opportunity programs economic development assistance abroad also investment future well future nations rapidly growing markets lie developing world helping people countries help extend opportunities better life help demonstrating governments concerned people encourage increasing cooperation west broad range issues therefore urge congressional approval funding propose bilateral assistance programs participation work multilateral development banks un agencies proposal establish foundation international technological cooperation reflects recognition scientists many developing nations ready work collaboration technological institutions solve great problems health nutrition productivity aspects economic development key commodity agreements also help us deal legitimate needs interests developing countries senate ratification international sugar agreement signed last year along price support legislation stabilize prices important commodity pledged contribution international tin agreement conduct negotiations rubber accord efforts build stronger international economy directed simply managing economic relationships among nations improving lives individual people around world lives individuals define success failure foreign policies reasserting america values america future best secured world founded decency justice compassion effort make human rights central component foreign policy comes deepest sense humane people make standards precondition every relationship countries yet human rights never far focus thinking violate best values year passed quarrelled timing tactics emphasis human rights abroad others pointed imperfect record human rights home yet dispute important fact experience concern human rights met great resonance world large term entered language become imbued everyday familiarity simply unknown little two years ago believe efforts contributed global awakening thousands political prisoners freed several countries torture prisoners significantly reduced eliminated trials often open public open advocacy human rights occurred nations concept heretofore forbidden international organizations un oas vigorous human rights commissions investigation airing human rights violations commission security cooperation europe helped make human rights institutionalized part international agenda sides atlantic number key nations around world democratic institutions strengthened democratic values reasserted americans proud leading role government played advancing process ask congress take action 1979 strengthen human rights record signed four important human rights treaties including convention racial discrimination international un covenants economic social rights political civil rights convention human rights senate ratification treaties firmly align nation growing forces rule law human dignity world similarly call upon senate finally ratify genocide convention united states one countries yet ratified convention anomaly corrected earliest possible moment congress also proud efforts undertaken past year alleviate plight refugees far corners world particularly fleeing troubled indochinese peninsula done great deal reduce suffering among desperate people provide many possibility new home new start continue part encourage others increase financial assistance opportunities resettlement hope cooperate closely congress passage new legislation allow us focus assistance efficiently working toward solution global human problem challenges reflect single fact pressure accelerating change century need fear phenomenon indeed welcome change merely challenge american history real degree nation charter prospered grown two hundred years worshipping status quo building nation confronting many tasks history assigned us found change natural element approach task building new foundation world change confidence nation whose strengths unmatched military forces strong growing stronger technological industrial capacities unsurpassed allies strong reliable way life stand nation continue magnetic international appeal pretend change comes without cost pretend comes without pain neither visionary men 18th century founded republic citizens conscience opposed slavery 19th men women 20th led us successfully two world wars looked upon change easy however look upon inevitable beginning country stages history future always brought americans higher level national achievement long willing invest time energy imagination toward shaping future begin new year repledge administration time energy imagination essential build new foundation world peace prosperity human justice together america congress people president master many challenges change make part nation purpose world bring america closer perfect union jefferson dream wider secure global community congenial values interests ideals jimmy carter white house january 25 1979
state union address devote believe high priority face nation 1979 seek build new foundation home abroad however administration time effort year also focus significant number important initiative goal send state union message member 96th congress present full picture basic legislative program domestic foreign affair year past two year administration develop cooperative relationship congress relationship result extraordinarily productive record 95th congress provide foundation renew sense trust confidence american people government enviable record match help 96th congress meet challenge administration eager help effort basic goal continue work build solid foundation next solid economic foundation stable price continue solid foundation efficient less intrusive federal solid foundation world peace american security foundation progress take office two year ago country face serious domestic problem economy recover recession unemployment intolerably high 7 million american work nation sound energy policy oil import rise rapidly federal government operate inefficiently numerous vital area trust openness integrity government low major social problem ignore inadequately addressed federal government ensue two year tackle problem problem solve overnight real progress make economy gross national product increase 10 real disposable personal income increase unemployment rate decrease 25 since election nearly 8 million new job create total employment reach record million comprehensive national energy policy enact department energy create help implement first major reform civil service system nearly century enact 6 reorganization plan approve implemented federal paperwork burden reduce 10 inspector general place department agency help root fraud abuse budgeting practice institute throughout government several hundred million dollar save sound cash management reform regulation write simple english regulatory council establish develop nation first regulatory calendar agenda renew sense confidence faith government gradually restore domestic problem attack aggressively nation first urban policy develop implementation begin social security system refinance assure long run solvency full employment act pass aid education expand 50 welfare reform program develop debated congress serve foundation effort year overhaul welfare system cumbersome regulatory apparatus deters competition economy dismantle deregulation airline industry domestic policy priority next year domestic program concentrate develop new foundation progress several area restrain inflation continue pursue employment economic budgetary goal make government efficient effective enhance basic human social need protect enhance right liberty preserve develop natural resource inflation administration major domestic priority reduce rate inflation maintain economic growth clearly major domestic concern american people problem look u help solve inflation place cruel burden poor fix income serf disincentive investment threatens continued economic growth job creation economic challenge inflation persistent historic enemy free society sap confidence faith future undermines trust determine meet challenge u last october announce program aid significantly effort reduce inflation tough responsible voluntary program throughout year work implement program part program require new legislation intend work closely develop enact legislation effort reduce inflation one difficult battle government undertaken many year battle afford lose government solve problem inflation alone must lead way cooperation win 1980 budget announce program last year make commitment american people reduce budget deficit fiscal year 1980 30 billion less budget submit congress honor commitment fy budget project deficit 29 billion less half deficit nation run office represent small budget deficit last six fiscal year fy budget billion project budget outlay increase previous year small annual increase federal spending last seven year billion spending total also mean meeting goal reduce federal spending 21 gross national product one year ahead schedule decision make restrain spending difficult succeed break back inflation federal spending must restrain set example private sector easy solution would take finally want emphasize fy budget neglect basic need disadvantage poor unemployed instance budget provide billion increase assistance poor also provide total billion adult youth employment training program especially target disadvantaged unemployed moreover significant increase education program disadvantage new fiscal assistance program nation city short budget austere also maintain commitment help country need hospital cost containment one high legislative priority year hospital cost containment one clearest test seriousness congress deal problem inflation clearly inflationary part health care cost recent year hospital industry last year hospital charge grow rate 13 percent experience several state show program one propose hospital save money reduce cost sound cost containment practice expect shortly propose hospital cost containment legislation build proposal pass last year senate real wage insurance propose congress real wage insurance program protect employee group comply 7 voluntary wage standard loss purchase power inflation exceed 7 inflation exceeds 7 employee receive tax refund equal 1979 income time difference actual inflation rate 10 7 program give worker strong economic incentive cooperate voluntary pay standard establish thereby help break spiral root current persistent inflation novel approach inflation problem persistence high inflation past ten year make clear new solution need innovative approach must add arsenal break back inflation real wage insurance represent type innovative approach require provide significant tax benefit work people participate help reduce inflationary cycle without raise tax anyone else administration intend work closely congress develop enact real wage insurance law voluntary pay price standard vital program voluntary standard succeed stake reduced rate inflation american demand deserve cooperation business labor obviously essential already clear evidence willingness join effort already receive assurance 200 nation large corporation comply standard recently oil chemical atomic worker union reach agreement contract major refinery meet pay standard throughout year pay price standard continually test cooperation encourage voluntary compliance help ensure standard success administration keep congress fully inform involved work implement program state local government succeed effort cooperation active participation state local government essential soon announce program actively involve governor mayor county executive local official comprehensive approach restrain inflationary pressure within control necessity recent year great inflationary burden work men woman involve necessity life food energy housing medical care effective program must involve series concert attack source rise price vital sector area administration establish task force identify exist government policy unreasonably inflate price suggest action take national local level combat inflation effort work directly congress state local government consumer group multilateral trade negotiation mtn already notify congress expect sign submit congressional approval set trade agreement reach tokyo round multilateral trade negotiation agreement expect achieve major reduction tariff nontariff barrier international trade agreement increase opportunity export import competition fair low price increase competition great prosperity american people passage mtn one high legislative priority year critical health domestic world economy countervail duty recently send congress message urge prompt passage legislation permit waiver imposition countervail duty certain imported product passage essential successful completion multilateral trade negotiation therefore one congress high priority begin session export unite state enter period export growth essential improve balance payment strengthen dollar thereby help reduce inflationary pressure private sector federal government must place high priority export national export policy announce last year move meet need first work reduce domestic barrier export exporter stifle excessive governmental regulation second provide incentive form good export finance good government export development program third work trading partner multilateral trade negotiation reduce foreign barrier export secure fairer international trading system exporter action expand export 1979 help u move toward reduce trade deficit although cure serious balance trade difficulty overnight first step essential effort strengthen position world trade reaffirm nation commitment maintain open world trading system resist protectionism council wage price stability council wage price stability play vital role effort council staff lead responsibility within executive branch implement voluntary wage price standard announce without council continue role effort would slim chance succeed therefore believe essential council along staff operation reauthorized early year additional staff request handle enormous volume work program reauthorization contain amendment interrupt restrain necessary work council staff employment administration work closely congress make significant progress last two year reduce unemployment create new job december unemployment rate represent almost 25 reduction december 1976 rate million people job begin administration increase exceed employment growth period since world war ii total employment reach high million past two year black employment 12 black teenage employment adult female employment increase teenage employment overall increase 11 although progress make unemployment remain unacceptably high group area unemployment remain much high worker last year end low unemployment rate 3 year framework continued progress next decade establish comprehensive employment training act ceta reauthorized high level four year full employment act become law many year effort administration demonstration youth program extend two year new partnership government private sector assist unemployed approve congress passage new title 7 private sector initiatives program target job tax credit encourage private employee hire poor young people others hard employ expand tax credit mother welfare 1979 framework help u continue improve employment prospect america worker especially want improve target job creation program need opportunity improve quality training employment assistance poor black hispanic youth woman expect achieve goal number action first continue work toward achievement full employment act goal provide average ceta public job shift many longterm structurally unemployed continue search promising way reduce structural unemployment deny many opportunity full participation american life second begin implement new private sector program include establishment private industry councils community throughout country encourage business hire unemployed propose congress effort support level 400 million year third continue special effort provide job train program young worker cooperation organization private sector must meet responsibility provide opportunity young american learn work fourth take step improve management delivery employment training service seek reform act authorizes employment service integrate program effectively employment training system administration also implement ceta amendment establish practice procedure improve quality program provide good management prevent fraud abuse make government efficient effective american people demand federal government effective efficient past two year work toward goal reorganize reforming government operation uncover remove fraud waste abuse real progress make government still operate competently want american people deserve 1979 must build base last two year provide people type government deserve help effort essential already begin build new foundation government efficiency year ahead reorganization begin reorganize government creation department energy change result six reorganization plan approve congress past two year plan help reshape improve operation executive office president international cultural communication agency emergency preparedness agency equal employment opportunity enforcement agency civil service commission administration employee retirement income security act propose congress department education create high priority administration education issue deserve far attention accountable management receive department large complex hew department would provide official devote attention education report directly also enable federal government responsive reliable partner state locality private institution primary responsibility education also propose congress reorganization plan involve economic development management natural resource development intensively study possible reorganization area surface transportation selective service system alaska natural gas pipeline natural resource economic development reorganization involve area overlap duplication unclear authority hamstrung effort reorganization save money people consult closely congress next several week submit reorganization plan regulatory reform last year take major step toward reform federal regulatory system range improve regulation write save hundred million dollar improve cash management technique dramatic reduction airline price occur congress join u lift heavy hand federal regulation illustrate advantage let competitive market rather government control industry performance public benefit similarly improve service increase competition lower federal expenditure reform federal regulation surface transportation send congress shortly surface transportation reform message deal rail bus trucking industry 1978 use authority chief executive improve management federal regulatory process issue executive order 12044 setting standard ensure executive branch regulatory agency facilitate public participation avoids needless cost regulatory analysis program establish regulatory analysis review group help ensure major new regulation possible executive order also establish procedure executive branch agency conduct sunset review reevaluate outdated regulation remove book wherever warrant finally create regulatory council compose executive branch regulatory agency voluntary participation independent agency develop calendar major federal regulation issue proposed 1979 nation first regulatory calendar publish next month use eliminate duplication overlap inconsistent practice year propose congress number legislative action take improve regulatory process include improvement specific regulatory program well regulatory reform act regulation issue unless genuinely require unless get job do maximum efficiency minimum paperwork cost burden quality regulation also improve provide opportunity interested party participate regulatory proceeding public involvement enhance provide financial assistance whose participation limit economic circumstance many agency inherent authority fund participation seek legislation specifically authorize program propose legislative program continue oppose legislative veto approach unconstitutional increase uncertainty delay deflect attention real solution none action area take expense deep personal commitment protect health safety environment workplace highway consumer product prevent deception unfairness consumer regulatory reform program help make needed program work well cost less gain support among sector society civil service pay reform enactment civil service reform act 1978 95th congress represent one fine examples cooperation legislative executive branch recent time effort show determination respond clear public desire improve management federal bureaucracy implementation reform act well way office personnel management merit system protection board federal labor relation authority authorize act establish addition head federal department agency move promptly implement new personnel procedures permit good motivate effective civil service however improvements management government work force need white collar blue collar military system must reform order make certain neither overpay underpay federal employee therefore propose federal pay reform legislation cover system congress equitable federal employee public pay reform important civil service reform public financing time long overdue reform way congressional election finance current flood money threaten pervert electoral process longer permit election open high bidder recent election clearly demonstrate kind problem cause uncontrolled campaign spending time adopt public financing congressional late public financing operate successfully last presidential election congressional race administration work congress passage sound congressional public financing law sunset administration work congress enact sound sunset bill bill federal program would carefully periodic basis determine whether continued existence justified procedure american people assure unnecessary government program agency end rather continued force inertia program agency improve important new foundation government efficiency seek passage sunset legislation go heart make government work lobby reform american people right know significant influence affect national legislature proliferation well finance organizational lobbying activity recent year demonstrate clear need reform outdated ineffective lobby disclosure law effect year administration continue work congress pass sound lobby law reform respect first amendment right americans minimizes paperwork burden yet allows meaningful disclosure waste fraud inefficiency although vast majority federal employee able honest hardworking need continue vigilant ensure taxpayer dollar waste fraud abuse implementation civil service reform lead improvement agency management practice program efficiency addition commit continue cut excess paperwork simplify grant requirement evaluate program well frequently already significantly reduce paperwork burden implement many recommendation federal paperwork commission continue 1979 early year nominate highly qualified inspector general arm tough new power prevent waste corruption justice department increase already intensive effort prosecute employee contractor abuse public trust addition new office ethic office personnel management special counsel merit system protection board help ensure integrity federal work force protect member political abuse state local government relation first president thirty year elect immediately service governor make relation state local government high priority administration first two year office strengthen federal system significantly involve federal regional director management government reinvigorate federal regional council result federal government able respond well quickly state local need addition involve state local official development policy great degree previous administration since 1977 federal state local government increase 80 billion per year 25 percent level aid first take office progress also make towards goal give governor mayor county official flexibility manage federal program federal government take seriously first time burden cost impose state local government taxpayer legislate regulate federal level time limited budget resource must achieve management federal resource place great reliance experience knowledge ability state local government future must attempt limit imposition new cost state local government avoid possible prescribing every detail administer federal program must work together identify specific way flexibility give state city county official administration federal program without compromise national purpose program design serve transportation 1979 shall continue effort begin 95th congress reduce regulatory burden nation transportation industry proposal surface transportation deregulation build upon principle increase competition proven successful airline industry shortly propose broad legislation begin deregulate railroad industry regulatory reform crucial first step toward revitalize important transportation mode addition also propose significant reduction regulation bus transportation certain regulatory change truck area also commit improve level safety transportation industry part effort intend vigorously pursue legislation improve equipment condition affect truck driver give strong enforcement authority federal agency forthcoming surface transportation regulatory reform message provide detail proposal finally propose overdue change nation maritime policy must improve ability merchant marine win fair share cargo administration continue support legislation establish federal minimum standard state automobile compensation system system proven far efficient deliver benefit victim automobile accident current tort system also provide great opportunity coordinate reduce overall insurance cost great percentage premium pay go administration current wasteful tort liability system would save money deserve congressional support consumer representation administration develop new procedure set standard assess performance effective public representation within government agency procedure design improve delivery government service citizen also enhance awareness government health safety economic concern consumer 1979 direct adequate resource procedure include complaint handle train technical assistance consumer organization advocacy consumer education information citizen participation leaa last year propose legislation would institute significant change structure program law enforcement assistance administration leaa potential improve strengthen state local law criminal justice program present form fall far short potential administration work congress year reform framework include national institute justice enable u obtain good information research crime problem legislation enact make certain new agency efficiently carry mission provide meaningful federal law enforcement assistance judgeship last year administration work closely congress enact legislation create additional federal judgeship need reduce court backlog delay result soon nominate 152 new federal large addition federal judiciary history judge still serve next century determine nominate judge high quality federal judiciary must select basis merit also determine increase low representation federal bench woman black hispanic minority goal within reach work together cooperatively recognize importance country place selection new judge judicial reform federal court function well right expect administration make judicial reform one goal 1978 congress take major step toward alleviate problem increase substantially number federal judge adopt numerous substantive procedural reform handle bankruptcy matter judicial reform remain made expand authority magistrate curtail diversity jurisdiction propose last congress shortly send message congress urge prompt action several additional proposal design improve responsiveness efficiency system justice merit attention approval congress addition indicate consumer message congress administration continue support reform class action procedure reform legislation seek ease unnecessary burden cost class action time prevent use harass manner antitrust enforcement competition free enterprise competition protect antitrust law central organize principle economic system competition produce powerful incentive innovation efficiency fight inflation enhances consumer welfare strict enforcement antitrust law critical health competition nation economy several important stride make last year improve antitrust enforcement 1978 court impose 11 million corporate fine antitrust violation imprison 29 individual antitrust violation fine sentence significantly large past year consistent strong commitment vigorous antitrust enforcement last year appoint national commission review antitrust law procedure suggest way expedite antitrust case make relief effective member recently report work closely congress judicial conference implement many recommendation similar progress improve effectiveness antitrust enforcement make 96th congress continue support legislation allow injure antitrust violation recover damage antitrust violator whether injured person direct indirect purchaser supreme court decision illinois brick case direct purchaser may recover even though may pass injury consumer prevent sue decision undercut state private enforcement antitrust law reduces deterrent effect may contribute high price often allow violator keep gain expense injured consumer need legislation would overturn decision banking anticipate receive shortly recommendation administration task force study regulation q system deposit interest rate control expect make recommendation base upon task force finding administration remain supportive congressional action deal need halt continue attrition percentage bank deposit subject reserve requirement federal reserve system carryover basis carryover basis one important reform pass congress tax reform act 1976 reform would add substantial equity tax law great efficiency capital market carryover basis reform effect end situation many wealthy taxpayer could permanently escape pay income tax gain inherit property unfortunately effective date delay end 1979 administration strongly oppose effort repeal reform delay implementation enhance basic human social need year immediately precede administration many nation basic human social need ignore handle insensitively federal government past two year significantly increase fund many vital program area develop new program need unaddressed target federal support individual area need assistance remove barrier unnecessarily keep many disadvantaged citizen obtain aid basic need progress past two year noticeably move u forward toward build new foundation solve country fundamental human social problem administration vastly expand assistance last month area employment education housing community economic development health care represent improvement american people record past two year demonstrate government meet citizen basic human social need compassionate way longer doubt government able treat american problem sensitivity come fiscal year budget restraint make difficult expand fund significantly many major domestic program though program increase continue make exist social program work effectively reduce waste fraud excess bureaucracy drain tax dollar intend meet basic human need period austerity efficiency act compassion unlocks resource need health care education housing economic development urgent social priority health program one high goal 96th congress take action provide americans opportunity lead healthy life opportunity deny many country health care service unaffordable inaccessible inefficient addition current system health care focus treatment disease little attention direct toward prevention need national health strategy correct inadequacy exist system element strategy already place need strengthen others require new legislation 96th congress national health plan improvement last year outline principle upon national health plan intend propose base base principle administration work develop national health plan enable country reach goal comprehensive universal health care coverage remain committed goal need improve health care coverage clear 19 million american health insurance another 65 million american face potential bankruptcy lack insurance protect catastrophic medical expense health care system highly inflationary spending entire health care rise annual rate 12 expenditure successfully contain current health delivery financing method produce unnecessary hospitalization expensive technology inadequate preventive care health resource unevenly distribute across country result significant gap vital medical service many resident rural inner city area next several week consult closely congress interested outside group scope nature plan propose expect submit plan later year shortly consultation complete look forward work congress toward prompt enactment plan essential companion plan must hospital cost containment legislation indicate earlier message make passage legislation one high priority year effort control health care cost would strengthen early passage health planning act must also continue promote competition health care sector economy accordingly fy budget expand federal support health maintenance organization demonstrate significant potential cost saving also continue press reform make easy hmo obtain equitable reimbursement medicare medicaid prevention accessible health service health care service alone however necessarily improve health status service affordable accessible efficient national health must direct attention health promotion disease prevention achieve goal improve health status surgeon general present year major report outline need area ask help carry many recommendation make great stride expand availability health care service rural urban area recent year creation national health service corps establishment system community health center health care accessible american program must expand fy budget provide expansion child health assessment believe health strategy must place high priority health child accordingly submit revise child health assessment program improve early preventive screening diagnosis treatment program child medicaid program would cover child receive medicaid service additional pregnant woman would become eligible medical service prior delivery improve health mother infants part national health plan mental health base upon last year recommendation president commission mental health propose comprehensive mental health legislation year along mental health message new community mental health system make new effort link mental health health social service chronically mentally ill enable live successfully community provide new community mental health service emphasize effort provide improve recognition treatment mental health problem general health care system addition increase support mental health research restore mental health research capacity commission find seriously erode past decade first lady help spearhead administration effort sensitize nation problem mental health area continue work directly implement pertinent recommendation commission drug abuse continue effort combat drug abuse administration rely program initiative proven successful past year serve building block future program today united state fewer heroin addict 1975 few american die heroin overdoses period end june 30 1978 previous twelve month seizures illegal drug high level ever improve coordination cooperation among federal agency result effective drug program without major budget increase much remain do situation remain serious 1979 look behavior individual turn drug stress financial investigation mean prosecuting individual responsible drug traffic rely heavily enlist foreign cooperation overall drug program effort success control drug abuse united state abroad drug regulation reform administration continue work congress overhaul current drug regulation law order assure consumer prompt access safe effective drug food nutrition last year work congress enact child nutrition amendment revamp many food program greatly expand supplemental food program woman infant child year propose legislation strengthen food program improve target school meal program needy institute error sanction scheme encourage state reduce costly food stamp error eliminate cap food stamp expenditures reform insure additional nutrition resource target truly need worker health safety continue fully enforce law protect worker health safety sensible efficient manner effort eliminate frivolous unneeded rule concentrate great enforcement effort dangerous particularly unhealthy occupational environment efficient management program serve interest labor management well work condition housing commit hold housing construction cost eliminate unnecessary regulatory burden american consumer affordable choice housing marketplace effort accelerate year also support introduction new money market certificate help housing industry maintain steady supply mortgage credit administration support provision federal housing assistance income people include elderly handicap period 1978 1980 administration commit resource one million additional unit assist housing income renter homeowner evidence commitment goal decent home every american 1980 recommend unit housing income person problem provide adequate housing rural area especially acute lack available land high site development cost widespread substandard overcrowd housing limit credit opportunity continue plague rural area government attempt help often hamper inappropriate burdensome regulation paperwork year administration take step assure federal regulation accommodate locally acceptable housing code endless paperwork inspection processing requirement currently mandate three major housing agency hud fha va consolidate streamlined community development administration remain committed partnership involve federal state county local government private sector community organization community development block grant program cornerstone partnership propose fy budget fund full authorization level increase 150 million fy fy level 1977 develop urban development action grant program already succeed leverage billion private investment create save job propose continuation action grant program next year 400 million authorization level neighborhood administration devote preservation neighborhood development sound neighborhood project goal evident emphasis neighborhood urban policy well operation department housing urban development agency last year part urban policy propose congress pass livable city neighborhood development program enable neighborhood group organization rebuild neighborhood addition congressional passage national consumer cooperative bank make available new source finance technical assistance group engage build cooperative enterprise reduce cost key consumer good service year administration congress receive final report national commission neighborhood look forward work congress many commission recommendation help make federal government increasingly responsive need neighborhood people work together meet basic need housing community development health care nutrition energy conservation urban policy last year propose nation first comprehensive urban policy policy involve one hundred improvement exist federal program four new executive order nineteen piece legislation congress cooperation thirteen bill pass last year propose congress several important part urban policy adopt last year two principal proposal urban fiscal assistance program national development bank fiscal assistance proposal include two principal component first standby countercyclical fiscal assistance program protect state local government unexpected change national economy would trigger place national unemployment rate rise percent would provide fiscal aid many needy government second component transitional highly targeted fiscal assistance program provide fiscal aid local government relatively city county eligible highly targeted program eligible truly need seek 250 million supplemental fy 150 million fy target fiscal assistance program also propose national development bank provide finance local economic development project aid revitalization nation community part bank propose significant increase economic development 550 million new economic development capital grant business billion new loan guarantee authority fy bank central engine economic development government propose consolidation many economic development loan program bank part economic development reorganization add 1 billion additional loan authority social security change 1977 congress work administration take difficult necessary action make social security system financially sound next fifty year help protect benefit current recipient work however social security system time time need adaptation change condition administration year make proposal reduce somewhat cost program trimming cost certain benefit proposal send social security advisory council representative contribute employer employee public national commission social security appoint part congress part ample opportunity review proposal prior submission change congress administration congress recommendation administration proposal social security outlay reduction hospital cost containment legislation enact would possible consider reduction social security tax begin 1981 however reduction would consider light alternative us saving include reduction budget deficit funding program beyond immediate reform propose administration commit review entire pension system develop country establish pension commission provide type analysis vital area need disability insurance reform propose congress integrate package reform disability insurance system separate social security change discuss measure improve incentive rehabilitation disable ensure benefit exceed disposable income make administration system simple consistent must make certain receive benefit exclude truly disabled otherwise return work welfare reform nation welfare system inequitable inefficient long overdue serious reform recommend congress package consist reform cash assistance expansion earn income tax credit expansion private public job opportunity welfare recipient fiscal relief state local government package enable u develop welfare system simple narrow great difference way state help poor encourages people work helps eliminate fraud abuse currently plague part welfare system administration already begin work closely congress enact welfare reform year must expeditiously move forward welfare reform year family major social initiative goal year undertaken vigor commitment security enhancement american family structure government must never impede work american family rather must design program policy support family ensure future generation american family thrive prosper white house conference family continue expedite plan year goal firmly mind child welfare reform nation present system overlap inadequate child placement program great disservice parent foster parent child need home little emphasis reunification family permanent placement child special problem child often go unattended therefore propose congress major reform foster care adoption service urge prompt congressional approval problem must leave unattended long old american early administration move correct one major concern old american possible bankruptcy social security trust fund legislation enact ensure financial solvency fund begin next century administration also act help remove discrimination senior citizen support legislation remove force retirement requirement federal civil service postpone mandatory retirement private sector age 65 70 addition administration work congress amend old american act way improve administration act social housing program employment provision food delivery establishment center elderly year administration continue effort ensure senior remain mainstream american life free age discrimination able receive assistance benefit earn veteran nation obligation basic provide men woman serve u member arm force still many veteran need medical care employment assistance assistance adjust disability result service last two year make significant improvement program help meet needs 1979 administration seek legislation increase compensation rate disable veteran improve education program disadvantage bill provide special readjustment counsel assistance vietnam era veteran need modernize va vocational rehabilitation program effort help veteran help addition continue provide quality medical care va hospital system make efficient thus responsive need change veteran population education improve skill educational opportunity one administration major goal aid improvement increase federal office education budget authority alone since take 8 billion fy billion propose fy budget increase education funding continue target program emphasize equal education opportunity support local school student assistance basic skill linkages school work school district high concentration low income child extra cost meet commitment equal educational opportunity last year propose concentration grant would give supplemental payment compensatory education program high poverty school district year request 400 million fully fund proposal state elsewhere message continue work congress create department education department make certain education receives attention federal level deserve high education last year sign law middle income student assistance act extend federal student aid middle income family face rise college tuition cost propose fully fund basic grant program continue fund college student aid program year propose reauthorization omnibus high education high education act national defense education act renewal act help enormously ensure continuation strong high education institution equal educational opportunity student nation owe debt gratitude historically black college past source college education talented black today retain critical importance production black citizen black earn degree black college vow would enhance role black college term office recently direct federal agency utilize fully resource black college fy budget increase fund howard university ask 120 million fully fund develop institution program strengthen college high concentration minority student science technology come office find federal effort promote basic research development lag determined change situation develop sounder scientific technological foundation future basic scientific research development investment nation future essential field health agriculture environment energy space defense enhance search cause disease undertake research anticipate prevent significant environmental hazard increase research astronomy maintain leadership space science push back frontier basic research energy defense critical national need despite severe budgetary constraint year continue increase federal support basic research request 13 increase outlay fy even though federal funding basic research increase believe government role demonstration commercialization pilot project selective great reliance upon private sector finance enhance high technology approach defense counter growth soviet force broad energy research program emphasize longterm application solar coal geothermal biomass alternate nuclear technology rely industry full part demonstration new technology energy field rather government fund research development company need favorable investment climates well economic growth well trade prospect sound policy patent antitrust procurement environmental regulation direction department commerce also engage major review aspect technological innovation participation numerous individual various industrial sector science technology play important part international relationship well many country especially develop country look america expertise problem solve ability propose establishment foundation international technological cooperation fitc foster collaborative effort people institution develop country effort direct basic human need agriculture nutrition health energy system rural development science technology also play critical part dramatic advance relationship people republic china scientific technological relationship build china parallel many relationship establish enhanced year nation group nation space last year mark 20th anniversary national aeronautics space administration 21 st year start incredible success pioneer mission venus year hope open new era space first launch space shuttle national civil space policy announce last fall remain dedicated ensure scientific technological leadership space policy budget request fy include funding maintain shuttle development production schedule continue space science exploration initiate effort select area advance satellite communication technique enhance remote sensing activity bring benefit area earth resource climate weather pollution agriculture communication last year work congress reorganize communication executive branch enact legislation strengthen public broadcasting 1979 priority include continued work congress important effort revise communication act take account technological change vigorous pursuit program already underway increase minority ownership broadcast station regulatory action government loan guarantee private loan training program program use new communication technology improve rural life deliver education agricultural medical service increase diversity radio tv elimination unnecessary regulation paperwork requirement cooperation federal communication commission proposal role postal service provide electronic mail service participation world administrative radio conference ensure increase demand radio frequency balance reasonable flexible manner small business former businessman especially sensitive importance small business economy vital role federal government play assist small business number action past two year administration work help small business flourish remain competitive leadership small business administration increase tax incentive significantly small business expand small business loan opportunity work increase small business export expand opportunity small business initiated program increase small business opportunity woman addition begin preparation white house conference small business january 1980 include local regional conference throughout country year continue effort prepare white house conference administration work closely congress develop legislation improve operation effectiveness small business administration cultural affair last decade national endowment art humanity make enormous progress develop project material enhance nation cultural life year endowment continue distinguish record achievement hopeful congress provide adequate fund white house conference art humanity year also strengthen program international communication agency present diversity american culture world deepen appreciation culture protect basic right liberty since take office work protect enhance basic right liberty provide american constitution law cooperation congress make important progress area next year though great deal remain do goal ensure equality basic freedom american realize dream equal opportunity remain unfulfilled everything power bring dream close realization civil right civil right equal opportunity take obligation office seriously strive secure full civil right equal opportunity american quarter century since supreme court historic desegregation decision nation progress vital area human right significant determine use authority resist effort weaken enforcement civil right equal opportunity law recent action congress impair administration effort enforce law land forcefully oppose law make society open equality opportunity virtually earth attempt weaken tolerate allow succeed administration take important step make civil right enforcement effective justice department diligent prosecution civil right violation office federal program ofccp equal employment opportunity commission eeoc reorganize grant increased authority ofccp vigorously enforce guideline executive order 11246 prohibits employment discrimination federal contractor require affirmative action contractor addition eeoc continue year provide effective central mechanism enforce compliance equal opportunity law do recent case supreme court administration continue strongly support affirmative action program help bring minority mainstream american life oppose rigid inflexible quota place law beyond exist law however state elsewhere message need ratify two amendment constitution significantly clarify enhance liberty right american equal right amendment district columbia vote right amendment equal right amendment provide woman equal legal status country effectively champion human right throughout world give woman full right entitle citizen must also work ratify amendment finally give citizen district columbia right american elect vote representation congress addition need correct weakness exist civil right law title viii civil right act 1968 prohibit discrimination housing remain largely empty promise lack adequate enforcement mechanism soon propose congress problem alleviate provide department housing urban development cease desist power department investigate make finding upon individual complaint would able enjoin discriminatory act direct appropriate remedy administration work congress see proposal give prompt favorable consideration woman one override concern administration ensure equal opportunity woman last year work closely congress extend deadline ratification equal right amendment june 30 1982 extension provide great opportunity ensure ratification amendment continue dedicate well full resource administration ratification effort battle afford lose determine win opposition amendment solidly base understanding legal effect amendment nothing provide equality america population confident active support member congress state yet ratify achieve ratification era urge join effort provide woman long last equal right law administration champion continue champion right woman choose role society protect choose role homemaker succeed enacting legislation provide assistance displace homemaker support legislation reduce 20 10 year marriage requirement former wife claim husband social security entitlement facilitate choice many woman combine family work responsibility accomplish goal support legislation pass increase employment opportunity support pregnancy disability act outlaws employment discrimination base upon pregnancy childbirth related condition strive improve woman professional opportunity within federal government end woman appoint senior position administration include two cabinet officer 20 senior appointee woman many area previous woman serve strengthened increase equal employment opportunity enforcement year addition continue effort ratify equal right amendment work closely congress enhance economic standing poor minority improve access housing health care child care choose work expand additional opportunity year woman business owner create permanent interagency group review help improve position woman business owner make every effort select many woman possible fill 152 new federal judgeship court continue country need deserve full participation woman society commit take step need ensure partnership district columbia administration work 95th congress pas propose amendment constitution grant full voting representation citizen nation capital ratification process propose amendment begin urge state legislature ratify resolution join state new jersey ohio michigan promptly ratify amendment administration work year effort ratify amendment administration also work closely congress new district government mayor marion barry expand home rule district include streamline procedure congressional review locally enact legislation removal federal government district budgetary process 1982 develop rational formula determine federal payment district equitable federal share financial responsibility funding district pension plan police fireman teacher judge work mayor barry make nation capital city model rest nation emulate native american federal government special responsibility native american intend continue exercise responsibility fairly sensitively administration continue seek negotiate settlement difficult conflict land water resource ensure trust relationship principle continue guide indian policy difficult conflict occasionally divide indian citizen country seek exercise leadership resolve problem equitably compassionately handicapped american physical disability year result continue improvement accessibility many opportunity u disabled take opportunity employment opportunity great access public facility service make progress removing obstacle impede discriminate disable community nation remove barrier discrimination society federal government must serve model successful removal physical psychological barrier thrown way nation disable section 504 regulation issue department health education welfare provide basis federal government lead way ensure right handicap undocumented alien one difficult sensitive domestic issue face country concern federal government policy toward undocumented alien continue believe effective humane measure need devise help relieve cause effect presence large number undocumented alien country pursue issue consultation government mexico visit next month make final decision consultation martin luther king martin luther king lead nation effort provide citizen civil right equal opportunity commitment human right peace stand monument humanity courage one nation outstanding leader appropriate birthday commemorate national holiday strongly support legislation achieve minority business year move vigorously implement strong minority business legislation enact congress 1978 meet goal triple federal procurement minority business total 3 billion faithfully implement minority program government improve operation several program design achieve equal entrepreneurial opportunity vital minority economic development currently evaluate adequacy organization current minority business development program commitment take whatever action legislative administrative need ensure operation efficient effective civil liberty privacy government private institution collect increasingly large amount personal data use make many crucial decision individual much information need enforce law deliver benefit provide credit conduct similar important service however interest must balance individual right privacy harm unfair us information individual able know information organization collect maintain able correct inaccurate record limit disclosure particularly sensitive personal information administration develop comprehensive privacy policy address concern last year legislation enact establish restriction wiretapping intelligence purpose government access financial record early 1979 propose privacy legislation cover medical financial sensitive personal record also take administrative action strengthen privacy control federal agency record measure go far toward give american citizen privacy protection need modern society recently announce intention submit legislation congress protect right press others prepare material publication search seizure undertake without judicial approval legislation propose federal state local law enforcement official generally require obtain subpoena conduct search seizure prepare material publication legislation would deal problem create supreme court decision stanford daily case serve solid protection right news medium others fourth amendment labor law reform nation labor law vital ensure sound relationship exist collective bargaining effort abuse labor law especially unduly slow block implementation increase recent year result reform labor law require order guarantee intend spirit fully observe enforced prepared work congress develop legislation improve fairness effectiveness labor law effort defeat legislation last year base emotion lack information actual effect majority congress allow prevail enact sound labor law legislation export boycott administration work congress reauthorize export administration act play vital role ensure american trade serf national interest make particular effort reauthorize part act prohibit american compliance foreign economic boycott israel amendment pass congress fair equitable must continue strenuously enforced intelligence charter work closely congress develop enact statutory charter intelligence community charter first time define law duty responsibilities intelligence agency set forth authority agency fulfill responsibility disclosures abuse recent year make clear need charter administration strongly commit develop pass charter legislation protect citizen right permit intelligence agency perform effectively essential duty criminal code federal criminal law often archaic frequently contradictory imprecise clearly need revision codification administration continue work congress develop federal criminal code simplifies clarify criminal well protect basic civil liberty criminal code pass senate last session serve basis progress year hatch act reform continue support effort reform hatch act federal employee position right participate political activity prevent political abuse hunger share grow concern nation people serious problem world hunger government government nation international organization work assure basic right food problem hunger malnutrition daily fact life million people throughout world order make program effective examine additional effort might undertake establish presidential commission world hunger leadership ambassador sol linowitz recommend realistic solution nation might undertake prompt efficient manner commission report year involve implementation recommendation administration work closely congress commission recommendation holocaust commission last year establish holocaust commission recommend government might officially recognize first time tragedy holocaust commission work well underway receive report year expect work together congress develop suitable memorial million die holocaust preserve develop natural resource high legislation priority 95th congress enactment first national energy plan dedication many member congress make goal reality administration commit use legislation foundation effort reduce dependence foreign oil increase ability develop domestic energy source conserve waste energy energy development goal reconcile administration resolve clean nation air water preserve precious natural resource continue protection environment continue develop fertile agricultural land administration commit help nation farmer continue achieve record yield export energy administration remain committed meeting future energy need build upon framework national energy act sign last november address key issue develop commercialize solar renewable energy resource make good use coal reserve abundant energy resource continue emphasis use energy efficiently improve manner produce use conventional source energy oil natural gas uranium minimize impact potential supply disruption continue storage oil strategic petroleum reserve submit congressional approval overall energy contingency plan much remain do energy area past investment improve energy supply energy use begin pay rate growth industrial energy use drop industrial production increase 1975 1977 growth domestic energy consumption 70 growth gnp previously two growth rate roughly equal significant improvement automobile efficiency gasoline consumption estimate 5 low otherwise would use heating oil electricity home energy source become much efficient oil consumption grow last year rate supply side new natural gas legislation whose provision begin take effect ensure new domestic production premium fuel help expedite delivery natural gas interstate market furthermore due addition alaska north slope oil domestic production oil hold steady last year foreign import 1978 1979 fy budget continue strong investment energy research development fy 1980 budget provide outlays billion wide range program develop energy technology future particular emphasis give solar energy research development improvement mine burn coal fission fusion research improvement exist technology conservation oil gas recovery uranium efficiency basic research commitment technologies future long short term critical sound comprehensive energy policy solar energy within next week send congress message solar energy base interagency study domestic policy review system transition use solar renewable resource must begin solar wind energy use biomass resource contribute significantly short long run meet nation energy need technology solar heat hot water use biomass generation electricity wind energy available compete conventional energy source tax credit national energy act along commercialization incentive help accelerate use solar renewable technology residential industrial sector economy fy 1980 budget increase solar research development program 40 fy 1979 total expenditures solar energy exceed 800 million include tax credit important initiative undertaken department energy agency international development tennessee valley authority department agriculture small business administration application solar technology building also increase thereby provide new market exist solar industry research development program strong emphasis give photovoltaics electricity produce directly solar energy conversion organic material useable energy form also receive increase funding fund new solar energy research institute golden colorado also increase proposal later announce couple fy budget chart firm ambitious course accelerate use solar renewable energy source future time solar energy come energy research development demonstration come year significant investment make demonstration technology convert coal useable environmentally acceptable energy form continue strong research development fusion development geothermal energy source hot underground brine hot rock resource effort resolve range environmental issue technology raise nuclear energy wide range administration initiative legislative administrative propose ensure country use light water reactor generation electricity safely efficiently central importance development implementation strong responsible program manage dispose nuclear waste result work interagency review group waste management make series legislative administrative recommendation ensure necessary schedule coordination legislative authority firmly place public discussion participation nuclear waste management area along close cooperation state local elect official receive continued high priority legislation also propose provide interim storage spend fuel exist reactor permanent waste repository establish enactment nuclear licensing sit legislation shorten lead time required plan locate construct license nuclear power reactor seek design construction activity new centrifuge enrichment plant portsmouth ohio continue ensure able meet nuclear fuel need domestic industry well international customer share objectives activity couple administration waste management program help ensure country continue rely current nuclear technology meet power need look toward future seek improve efficiency exist power reactor reduce uranium feed requirement longer run administration maintain strengthen strong research development program advance nuclear fission technology fast breeder reactor continue believe clinch river breeder reactor project premature technically inadequate go forward administration commit keep breeder option open future domestic crude oil pricing provision adequate incentive domestic production crude oil conservation must carefully weigh light effort control inflation consultation congress make decision recommendation domestic crude oil pricing relate issue later year energy impact assistance new domestic energy resource develop particularly rural isolate area country provision must make need rapidly develop community administration seek enactment legislation establish inland energy assistance program funding 150 million per year aid state local area experience rapid growth population result new energy supply development community often plan meet increase need new public facility service since population increase occur new energy supply activity fully develop produce local revenue legislation essential ensure burden associate solve energy problem bear equitably citizen region country management federal energy resource last two congress pass landmark legislation reform management coal oil gas resource new law include federal strip mine control amendment outer continental shelf land act mineral lease act new framework administration proceed implement swiftly new program permit increase leasing development activity protect environment water policy legislation water basic human necessity proper management essential economic activity particularly arid west policy administration design emphasize efficient use water well need provide adequate water supply particularly sensitive interest west area development additional water resource importance water conservation concern many eastern urban area water system last year announce comprehensive water policy include many reform implement administratively addition propose legislation increase role state water policy increase water planning grant new grant state water conservation program also propose legislation would provide state share cost federal water project cost proposal result direction state set water project priorities help insure federal program responsive press need congressional action also need administration amendment modernize 1902 reclamation act ensure acreage limitation federally fund irrigation project equitable fair environment administration commit balance need development conservation preservation natural resource nation bless outstanding natural heritage properly care meet need food fiber mineral energy recreation solitude way environmentally sound congress administration work together past two year achieve goal enact first federal standard coal improve extended clean air glean water act create substantial number new national park protect area 1979 protection alaska land implementation water policy resolution wilderness nonwilderness designation national forest system reform management federal energy resource major environmental initiative administration effort enforce implement environmental statute firmly fairly streamline environmental review requirement protect public health preserve wildlife resource continue pursue vigorously possible alaska last congress passage legislation designate national park wildlife refuge wilderness area national forest wild scenic river alaska high environmental priority administration protect magnificent alaskan wild land take several action adjournment 95th congress include creation 17 national monument cover 56 million acre area well outstanding part alaska cover administration proposal protect promptly legislation order assure great national treasure wildlife scenery history untouched ecosystems saved child grandchildren permit appropriate commercial use certain area roadless area designation rare ii agriculture department release tentative recommendation nearly complete work study lead proposal resolve status remain roadless area national forest system administration proposal involve additional wilderness designation many state release remain land nonwilderness activity initiative also eliminate uncertainty land use part national forest system ensure development use adequately support preserve critical part natural heritage unspoiled condition environmental protection recent year quality environment improve much remain do clean air water control contamination toxic material environmental protection agency focussing effort protection public health assess effect substance introduce environment ensure hazardous waste dispose safely time epa health safety agency exercise new care implement environmental regulation avoid impose unnecessary cost red tape healthy safe environment need incompatible healthy economy committed nation investment environment cleanup must incentives flexibility allow important environmental goal achieve low cost unnecessary requirement delays increase cost remove epa simplify consolidate permit program reduce paperwork red tape delay agency begin introduce innovation allow firm flexibility find low cost method control pollution submit legislation consolidate federal fund environmental program state level thus give state flexibility use fund deal press environmental problem change make assure american public money spend environmental control best investment make future child future state food agriculture world food security substantially improve 1978 third consecutive year crop harvest part world push supply record quantities create opportunity people world improve diet united state 1978 also year record large food record feed grain crop harvest producer farm sector capability lead world productivity despite record crop place downward pressure price abroad farm economy become strong 1978 agricultural trade reach record level value agricultural export reach billion fiscal percent 1977 record volume farm export record 125 million metric 18 percent 1977 agricultural trade make another record contribution balance billion fiscal 1978 export also account one every four dollar farmer earn net farm income billion 1977 estimate 28 billion high record constant dollar best year since 1975 achieve meet domestic need fulfil commitment overseas customer build reserve future stability protection recovery agriculture share crop livestock producer alike indeed american livestock producer look forward several year good return help recover last four year mark poor price force liquidation herd part recovery farm sector attribute program policy adopt administration farmer use improve income stabilize price personally proud recovery farmer make international agricultural trade past 2 year administration work reduce barrier international trade develop new market encourage increase export agricultural product agricultural trade act 1978 example provide important new authority intermediate credit establishment trade office major market move establish new strong trade tie several nation include japan people republic china partly result effort export farm produce good expect reach record 29 billion fiscal percent high 2 year contribute 15 billion balance payment unlike previous multilateral trade negotiation current mtn place heavy emphasis lessen restriction trade agricultural product effort major impact agriculture future broaden access important exist new international market crop insurance federal government operate several program protect farmer economic loss associate crop failure experience recent year program demonstrate many serious breadth coverage equity program benefit efficiency program administration propose comprehensive nationwide insurance reform bill 96th congress aim provide fairer effective protection farmer additional cost taxpayer proposal several exist disaster assistance program would consolidate one comprehensive program ensure economic loss result natural disaster uncontrollable risk international emergency wheat reserve cornerstone domestic food agricultural policy farmerowned grain reserve little year build billion bushel grain equivalent third stock past year stock remain ownership farmer produce rather hands government international grain trader reserve provide critical cushion shock market cause production shortfall either abroad need establish sort protection international food aid program accordingly administration reintroduce legislation authorize establishment management international emergency wheat reserve reserve provide develop country assurance able fulfill food aid commitment time protect domestic economy inflationary pressure period grain shortage sugar absence congressional passage domestic sugar program last session administration take several step assure domestic producer fair return consumer assure supply stable price underscore administration commitment achieve ratification international sugar agreement direct sugar import country party agreement strictly limited level permit agreement 1979 also ask received extension deadline ratify isa june 30 1979 addition end last year issue proclamation provide new flexible system sugar import fee protect domestic raw sugar price 15 cent per pound help stabilize world sugar price satisfy international commitment protect domestic sugar producer administration commit work congress develop effective domestic sugar program early session achieve ratification international sugar agreement rural development throughout 1978 administration take step make exist federal rural development program work well many rural area rural resident 1970 period rapid growth development income level rise large number well job create rural community across nation rate population employment growth rural area substantially great urban problem unplanned rapid growth area also reverse decade rural economic stagnation nevertheless rural american still experience disproportionate concentration press human problem home lack complete plumb rural area rural infant mortality rate 10 percent high urban one 70 percent rural poor half rural elderly automobile cause great hardship distance travel get access basic health care job social service quarter americans live rural area 40 percent nation poor live long small town mayor rural county official individual rural american frustrate maze federal grant application requirement eligibility standard audit deadline make virtually impossible address rural problem effectively many year money time waste move address chronic problem last year white house rural development initiative result commitment build 300 rural primary health clinic serve million american lacked access care major streamline rural water sewer grant process five agency distribute billion federal fund year new process permit single application single audit single funding source single point federal saving local government several hundred million dollar year along reduction processing time much 15 month specially target rural job train program rural disadvantage water sewer health support field effort address rural problem continue expand 1979 address problem rural transportation housing economic development among others addition year plan articulate set overall rural development principle goal guide action administration principle provide focus direction priority myriad separate federal action policy effectively work overcome problem rural isolation promote economic development meet basic human need protect quality rural life assure equity administration federal program rural american eligible build effective partnership among federal state local government private sector meeting locally define rural development priority furthermore several administration initiative impact condition rural america make certain rural perspective consider initiative develop area welfare reform national health plan foreign policy priority continue challenge change take office two year ago month convince america pursue change course world undergo vast change midst accelerate change america choice lie face chaos build others new foundation true world community foreign policy accepts latter responsibility basic belief america critical role world end must four broad objective buttress american power global security stability depend strengthen relation nation throughout world order widen spirit international cooperation deal constructively press world problem otherwise disrupt even destroy world community seek assert traditional commitment human right rejoin rise tide belief dignity individual progress towards goal depend first ability nation work together common interest come year congress executive public address unusually wide range international issue action take impact nation position world many year establish secure nuclear balance develop close relation world populous nation achieve historic step towards peace middle east setting pattern trade relation next decade beyond report elaborates address congress particular concentrate issue role congress important build new foundation peace case challenge clear exercise strong american leadership others shape change rather permit change shape u america military strength elsewhere report describe domestic program policy require united productive america maintenance american military strength essential foundation successful foreign policy safeguard freedom accomplishment friendships world accelerate change fraught potential danger uncertainty mark continue soviet military buildup must together ally unsurpassed military capability deter attack attempt political coercion moreover must military force mount effective defense level hostility vital interest jeopardize defense budget present congress fund program prudent investment ensure effectiveness strategic conventional military posture begin development new survivable ballistic missile system enhance icbm component strategic triad maintain trident submarine missile program increase security strike power range submarine force extend effectiveness bomber force addition cruise missile pursue vigorous program research development cruise missile aircraft system ensure continued technological superiority america nuclear deterrent addition defense budget submit week strengthen conventional capability fulfill commitment major ally friends retain credible military presence atlantic pacific continue add armor firepower infantry build modern small aircraft carrier together frigates destroyer improve effectiveness flexibility surface fleet nato already achieve important progress toward make alliance effective change security environment help launch alliance defense program offset grow soviet modernization deployment europe ltdp increase nato military capability well coordination defense effort increase investment modern equipment remove support congress serious obstacle strengthen turkey defensive capability make progress toward reintegration greek arm force nato military structure effort help repair serious deficiency nato southern flank near final agreement portuguese renewal base right azores provision adequate military well economic assistance turkey portugal ally friend need matter high priority come year nato strength grow 1979 encouraging process standardize alliance equipment improve ally readiness proposal soon put 96th congress call authorization intergovernmental agreement simplify logistical problem peacetime period hostility agreement permit reinforce nato rapidly provide effective defense lower cost also intend maintain vigorous american military presence pacific successful completion revise military base agreement philippine follow ten year negotiation provide essential underpinning military capability asia congressional authorization transfer military equipment republic korea another contribution assure security korea japan action unmistakably signal desire promote east asian stability intention remain concerned involve responsible power pacific essential task improve military posture must also accompany increased efficiency take opportunity thank congress support last year action reduce waste needless duplication defense budget vigorous effort continue year order assure united state possess strong military force low possible cost building community nation military strength essential peace alone guarantee system cooperation rest world part foundation security best hope safer america peaceful world reside build close tie many nation possible major ally throughout 1978 north atlantic alliance grow partnership link u western europe japan remain heart foreign policy cooperation share whose purpose traditions close strong grow strong summit meeting unprecedented pattern consultation level government work together virtually today critical issue together seek reduce risk nuclear confrontation work way strengthen common defense attempt promote peaceful transition southern africa strive resolve conflict eastern mediterranean support last peace middle east maintain stability persian gulf contribute sound international economy consult issue confront society problem youth age family community growth short advance democratic ideal home time change country america role host nato summit meet washington last spring attendance economic summit bonn last summer symbolize american commitment strength relation europe japan look forward meet allied leader tokyo summit next june continue essential effort deepen cooperation u wider community change reality political economic interdependence require strengthen tie throughout develop world seek improve relation communist nation well trip nigeria india saudi arabia iran brazil venezuela underlined american sympathy support international role country play process world change strengthen consultation asean nation serve end trip mexico early next month part process mexico important u neighbor also one vigorous democracy hemisphere leader develop world neighbor share agenda common migration economic growth social provide opportunity establish uniquely productive cooperative relationship trip poland visit secretary vance secretary blumenthal hungary romania underscore importance attach good relation nation eastern europe support congress policy toward eastern europe provide strong foundation building strong economic cultural political process continue go forward come year china arrival next week first leader people republic china officially visit washington give u early welcome opportunity new year cement tie friendship hospitality u emphasize expectation relationship china constructive one contribute diversity world peace stability asia direct interest country fulfill promise new era relation require legislation support congress legislation particularly important facilitate continue trade relation people taiwan instrumentality assure continue peace prosperity high priority legislative program 1979 ussr seek better relation soviet union people republic china profoundly interest nation global security therefore would like also welcome president brezhnev country near future time would hope conclude agreement curb strategic arm race area two nation work constructively together include comprehensive nuclear test ban treaty limit indian ocean deployment transfer conventional arm restraint area turbulence tension cooperative effort would much make world safer place never ignore soviet action challenge interest responsibility people world maintain pattern detente genuinely reciprocal broadly define deal world problem true world community fashion endure long weapon war multiply spread long ancient dispute fester demand justice unmet long much mankind remain impoverish without hope emphasize state union address need curb strategic arm race never urgent increase risk nuclear war needless competition draw away scarce resource need invest area nation strength undermines america security conclusion ratification satisfactory salt ii treaty soviet union therefore among top priority make major contribution enhance security keep open option carry need modernization strategic force preserve deterrence take whatever time necessary negotiate sound verifiable agreement convince american people congress chance examine term benefit consider shape future without conclude serf vital security interest continue consult congress proceed year important arm control negotiation comprehensive nuclear test ban prevention warfare mutual balance force reduction europe limit rise tide conventional arm transfer risk inherent proliferation nuclear technology figure prominently among danger world community although rest world still far go deal responsibly risk united state take important step last march adoption nuclear act first time history establish comprehensive legislation cover international cooperation nuclear field export material build promise begin throughout 1979 need progress follow area nuclear international nuclear fuel cycle evaluation infce effort help u develop new international nuclear fuel consensus adequately balance energy need concern continue believe good alternative exist commercialization dangerous breeder reactor cooperate fully possible country explore alternative seek substantial progress problem manage nuclear waste attract great international support acceptance nuclear safeguard ask senate ratify treaty iaea voluntary safeguard offer provide concrete proof belief international safeguard interfere successful development operation commercial nuclear power call early senate ratification protocol treaty tlatelolco contribute lessen nuclear danger latin american neighbor cuba country hemisphere yet ratify treaty regional conflict tension curb mean war remove threat war must seek resolve conflict ease tension build trust urgency task importance united state world nowhere clear middle east though great progress goal last settlement trouble part world still elude u one look middle east history harbor illusion difficulty ahead yet make great stride toward final peace agreement two principal adversary middle east difference overcome far outweigh issue still divide israeli egyptian commitment peace provide indispensable step toward peace israel neighbor foster stability orderly change favor entire middle east region peace permit u strengthen tie arab state region enhance relationship israel relationship always special u 1979 count continue collaboration 96th congress behalf effort gain maintain peace throughout region support congress american people purposeful role region particularly important light tumultuous event take place iran since end second world war united state maintain close relationship iran vital interest iran independence integrity people iran shape future without foreign interference policy government unite state expect policy iran neighbor africa congressional support peace stability orderly change essential tense region well southern africa try help bring peaceful transformation majority rule avoid grow bloodshed white black deep intervention soviet union cuba together european ally canada african state directly concern make progress toward independence majority rule step would positive impact evolution event rhodesia elsewhere southern africa hearten support african leader work u effort resolve namibian rhodesian issue congressional repeal byrd amendment essential enhance credibility effort avoid gather war soviet cuban gain southern africa consult closely congress come month seek constructive role play increasingly important maintain position impartiality among party help resolve difference choose path peace latin america hemisphere point pride cooperative spirit enable u change mutually beneficial way basis relation panama senate approval two panama canal treaty last year improve quality historic relationship panama friend every part latin america act country help demonstrate ability protect major security interest deal small nation dignity mutual respect congressional action pas necessary implementing legislation treaty october 1 deadline ensure canal efficiently operate transition new partnership panama treaty implement legislation like effort help people nicaragua find endure democratic solution current crisis important future stability central america whole strengthen new mature relationship nation latin america international economy daily live constantly remind importance healthy world economy strength see wage worker produce good export choice good consumer price energy must work closely country ensure world economy steadily develop growth together manage use resource protect environment focus much effort past year bonn economic summit work strategy cooperation partner improve world economic situation within framework summit decision west germany japan take measure stimulate economy give top priority fight inflation action along take summit participant lead convergence economic policy strengthen global economy strengthen dollar work arrangement country counter speculative disorder currency market since announce dollar stabilization measure last november stop dollar decline value currency actually increase dollar value around 10 percent several major currency moreover announce program increase export benefit american farmer worker strengthen position dollar close new agreement trade partner establish fair well operate open framework world trade american people vital stake congressional approval agreement ten million american job depend export every third acre farmland produce sale abroad twothirds import essential raw material good readily produce time difficult strain economy always impulse abandon commitment open world trading system cost course american people would enormous american family would pay buy would less choice good available inflation would fuel job would jeopardize protectionism trade partner breed protectionism u convinced economy adapt change patterns world trade way protect future worker compete effectively world economy new trade agreement give u opportunity program economic development assistance abroad also investment future well future nation rapidly grow market lie develop world help people country help extend opportunity well life help demonstrate government concerned people encourage increase cooperation west broad range issue therefore urge congressional approval funding propose bilateral assistance program participation work multilateral development bank un agency proposal establish foundation international technological cooperation reflect recognition scientist many develop nation ready work collaboration technological institution solve great problem health nutrition productivity aspects economic development key commodity agreement also help u deal legitimate need interest develop country senate ratification international sugar agreement sign last year along price support legislation stabilize price important commodity pledge contribution international tin agreement conduct negotiation rubber accord effort build strong international economy direct simply manage economic relationship among nation improve life individual people around world live individual define success failure foreign policy reassert america value america future best secure world found decency justice compassion effort make human right central component foreign policy come deep sense humane people make standard precondition every relationship country yet human right never far focus think violate best value year pass quarrelled timing tactic emphasis human right abroad others point imperfect record human right home yet dispute important fact experience concern human right meet great resonance world large term enter language become imbue everyday familiarity simply unknown little two year ago believe effort contribute global awaken thousand political prisoner free several country torture prisoner significantly reduce eliminate trial often open public open advocacy human right occur nation concept heretofore forbidden international organization un oas vigorous human right commission investigation air human right violation commission security cooperation europe help make human right institutionalize part international agenda side atlantic number key nation around world democratic institution strengthen democratic value reassert american proud lead role government play advance process ask congress take action 1979 strengthen human right record sign four important human right treaty include convention racial discrimination international un covenant economic social right political civil right convention human right senate ratification treaty firmly align nation grow force rule law human dignity world similarly call upon senate finally ratify genocide convention unite state one country yet ratify convention anomaly correct early possible moment congress also proud effort undertaken past year alleviate plight refugee far corner world particularly flee trouble indochinese peninsula do great deal reduce suffer among desperate people provide many possibility new home new start continue part encourage others increase financial assistance opportunity resettlement hope cooperate closely congress passage new legislation allow u focus assistance efficiently work toward solution global human problem challenge reflect single fact pressure accelerate change century need fear phenomenon indeed welcome change merely challenge american history real degree nation charter prosper grown two hundred year worship status quo build nation confront many task history assign u find change natural element approach task build new foundation world change confidence nation whose strength unmatched military force strong grow strong technological industrial capacity unsurpassed ally strong reliable way life stand nation continue magnetic international appeal pretend change come without cost pretend come without pain neither visionary men 18th century found republic citizen conscience oppose slavery 19th men woman 20th lead u successfully two world war look upon change easy however look upon inevitable begin country stage history future always bring american high level national achievement long willing invest time energy imagination toward shape future begin new year repledge administration time energy imagination essential build new foundation world peace prosperity human justice together america congress people president master many challenge change make part nation purpose world bring america closer perfect union jefferson dream wider secure global community congenial value interest ideal jimmy carter white house january 25 1979