We enter 1974 not at the beginning of an historical cycle, but in the middle of one. Beginnings have been made in many vital areas, beginnings which we now must build upon. New needs have arisen which we are in the process of addressing. Opportunities are coalescing which give us a chance to make historic progress toward a stable peace and expanding prosperity. In looking at the agenda for 1974, we cannot consider the work of this or of any one year in isolation. What we select as our tasks in 1974 must build on the work of the years before, and anticipate needs of those ahead. Indeed, one of the continuing challenges facing us in the legislative process is that of the timing and pacing of our initiatives. It would be as false to pretend that we could do--or afford to do everything at once, as it would be to maintain that we can do nothing. Therefore, we must strive to maintain steady progress, selecting each year among many worthy projects those that are ripe for action at that time, and that can be accommodated within the constraints of our budget--but pressing to ensure that the most that can be done is clone. In discussing my legislative recommendations for this Congressional session, therefore, I shall do so in the context of the advances that have already been made, the problems that remain, and the special opportunities we have in 1974 to make further progress. 
I have started with certain basic premises: --The basic tax burden on the American taxpayer should not be increased. --Our new initiatives, therefore, should be scaled to what can prudently be spent given the level of revenues that would be generated by the existing tax structure at full utilization of our resources. --Increases in Federal spending should be kept to a minimum, but the budget should be flexible enough to be used, if necessary, to maintain jobs and prosperity. --It is essential that we break the old habit of regarding any Federal program, once established, as permanent; we must learn to scrap old programs that are no longer effective or needed in favor of new ones that are. This is the only way we can afford to do what must be done. Within these guidelines, there are a number of major new initiatives which are ripe for action in 1974--several of which can be milestones on our march to a life of greater freedom, greater opportunity and greater prosperity for all. In particular, 1974 can be the year in which: --First, we not only break the back of the energy crisis, but also, through Project Independence, lay the foundation for our future capacity to meet America's energy needs from America's own resources--at reasonable prices and with adequate environmental protection. --Second, we take another giant stride toward lasting peace in the world--not only by continuing our policy of negotiation rather than confrontation where the great powers are concerned, but also by helping toward the achievement of a just and lasting settlement in the Middle East. --Third, we will check the rise in prices, without administering the harsh medicine of recession, and move the economy into a period of steady growth at a sustainable level. --Fourth, we establish a new system of comprehensive health insurance that makes high quality health care available to every American in a dignified manner and at a price he or she can afford. --Fifth, we continue to build a new era of achievement and responsiveness in State and local government, by cutting the strings of too tight Federal control that have bound the hands of State and local officials in community and economic development programs. --Sixth, we make a crucial breakthrough toward better transportation by strengthening the ability of local communities to deal with their transportation problems. --Seventh, we reform our system of Federal aid to education to provide it when it is needed, where it is needed, and so that it will do the most for those who need it most. --Eighth, we make an historic beginning on the task of defining and protecting the right of personal privacy. --Ninth, we start on a new road toward reform of a welfare system that bleeds the taxpayer, corrodes the community and demeans those it is meant to assist. --And tenth, together with the other nations of the world, we establish the economic framework within which Americans will share more fully in an expanding world trade and prosperity in the years ahead, with more open access to both markets and supplies. MEETING OUR ENERGY NEEDS At the start of this Congressional session, the number one legislative concern must be the energy crisis. The cooperative efforts of the American people, together with measures already taken by the Administration, have significantly reduced the immediate impact of the energy crisis. There has been some economic dislocation and some individual hardships, but these have been minimized by our policy of encouraging broad conservation measures and allocating scarce energy resources so as to do the least possible harm to jobs and the economy. The object has been to keep our farms and factories producing, to keep our workers on the job, and to keep our goods and services flowing, even if this means that we must live and work in somewhat less comfortable surroundings and drive fewer miles at slower speeds. Even with the full cooperation of most Americans, however, we will still face real challenges--and genuine shortages--in the months and years immediately ahead. To meet these challenges, we must change our patterns of energy consumption and production, we must press forward with the development of reliable new energy sources, and we must adjust to the fact that the age of unlimited supplies of cheap energy is ended. The immediate energy crisis began with the oil embargo imposed in the Middle East last fall. But the embargo only hastened a shortage that was already anticipated. For a number of years our fuel consumption had been climbing while our production of domestic energy supplies declined. We became more and more heavily dependent on oil imports and, consequently, more vulnerable to any interruption or reduction in those imports, as well as to sudden increases in foreign prices. Today, we have an interruption in supplies and we face sharply increased prices for those supplies when they are restored. Irrespective of the possibility of restoring the flow of Middle East oil, we must act now to ensure that we are never again dependent on foreign sources of supply for our energy needs. We must continue to slow the rise in our rate of consumption, and we must sharply increase our domestic production. The effects of energy conservation can be felt at once. Already the responsiveness of the American people to the recent crisis has proved to be the major factor in helping to avoid the serious consequences that the winter might have brought. That conservation must continue. The required increase in domestic supplies cannot be achieved so rapidly. It will involve the development of entirely new sources of energy as well as the expanded development of oil and coal resources; it will require a significant expansion of our research and development efforts; it will require a shift from the use of scarce fuels to those which are more plentiful but also more expensive than the cheap energy to which we have been accustomed; it will require that we encourage both exploration and production; it will mean that as we act to prevent the energy industry from making unconscionable windfall profits, we must also avoid crippling that industry with punitive legislation; and finally, it will require that we make some difficult decisions as we sort out our economic and environmental priorities. As we seek to act domestically to increase fuel supplies, we will act internationally in an effort to obtain oil at reasonable prices. Unreasonable increases in the cost of so vital a commodity as oil poses a threat to the entire structure of international economic relations. Not only U.S. jobs, prices and incomes are at stake, but the general pattern of international cooperation is at stake as well. It is our hope that we can work out cooperative efforts with our friends abroad so that we eau all meet our energy needs without disrupting our economies and without disrupting our economic relationships. Last week I sent to the Congress a comprehensive special message setting forth our energy situation, our energy prospects, our energy needs, and the legislative measures I consider necessary for meeting those needs. I shall not repeat that analysis nor the full list of those recommendations today. I do want to urge, however, that the critical energy measures which I have proposed be made the first order of legislative business in this session of the Congress, and that work go forward expeditiously on the others. Those measures which I request be given the highest priority are the following: --A special energy act which would permit additional restrictions on energy consumption and would postpone temporarily certain Clean Air Act requirements for power plants and automotive emissions; --A windfall profits tax which would prevent private profiteering at the expense of public sacrifice; --Unemployment insurance for people in areas impacted by serious economic dislocation; and --Mandatory reporting by major energy companies on their inventories, their production and their reserves. I am also asking that the Congress quickly establish the Federal Energy Administration and the Energy Research and Development Administration to provide the appropriate organizational structure for administering the national energy policy, as we work toward the establishment of a Department of Energy and Natural Resources. The 13 other energy measures I requested last week deal with longer-term needs, extending beyond the present emergency. But these also require expeditious action if we are to achieve the goal of Project Independence--a capacity for energy self-sufficiency by 1980. The success of Project Independence is essential to the continued strength of our position in world trade, and also to our independence of action as a great power. I hope that our joint efforts now to resolve the energy crisis and to move toward a capacity for self-sufficiency in energy will enable the President who addresses the 98th Congress a decade from now to look back and say we made it possible for America to enjoy continued peace and prosperity in the 1980s. THE NATION'S ECONOMY 
THE WORLD ECONOMY During the past three years the United States has reached an unprecedented level of material prosperity. Industrial output has set new records. Trade has flourished. Consumption has risen to the highest levels in history. Even our inflation rate-the most serious economic problem we now face--has been one of the lowest in the industrialized free world. The major policy decisions we took in 1971 contributed significantly to this prosperity--both here and in other countries. It was clear, for example, as we moved into the 1970s that the international monetary system adopted after World War II needed major adjustments. Unsustainable imbalances had developed, threatening a resurgence of protectionism and a disruption of world trade. This is why I decided to take some very strong measures in August of 1971, measures that have resulted in a major realignment of world currency values, progress toward new and more flexible international monetary management, and negotiations toward a more open and equitable trading system. These adjustments, while essential, were not easy. But now we have finally entered into a more flexible and realistic international financial system. Much remains to be done to complete the transition, but its beneficial results are already clear. The realignment of currency values helped produce an increase of 80 percent--or more than $50 billion in the rate of U.S. exports during the past two years, along with a major improvement in our trade balance. This improvement was good not only for us, but also for the rest of the world. In addition, the shocks to the world economy arising from reduced food supplies in 1972 and 1973, and in recent months from the oil embargo and the arbitrary increases in the price of oil, all were managed without panic under the new arrangements. Indeed, world trade has continued to expand, despite these temporary difficulties. INTERNATIONAL TRADE BARRIERS A vigorous international trade is vital to the American economy. Jobs for American workers depend on our ability to develop foreign markets. Moreover, American consumers deserve access to foreign-made products that might be less expensive, or more interesting, or unavailable in the United States. But if trade is to be advantageous over the long run, it must be conducted on a basis which is fair to all participants. There are still many unnecessary barriers to trade which need to be lowered or removed. While improvements have been made in this situation during the last 10 years, we need now to build on this progress and to negotiate for more open access both to markets and supplies. This is why I call upon the Congress with special urgency to complete action on my proposed Trade Reform Act, in order to provide the authority we will need to negotiate effectively for reductions in barriers to trade, to improve the trading system, and to manage trade problems at home more effectively. As the Senate considers this legislation, I would draw its attention particularly to provisions added in the House which would seriously impede our efforts to achieve more harmonious international relationships. These provisions would effectively prevent both the extension of nondiscriminatory tariff treatment and of credits to certain Communist countries unless they followed a policy which allowed unrestricted emigration. I am convinced that such a prohibition would only make more difficult the kind of cooperative effort between the United States and other governments which is necessary if we are to work together for peace in the Middle East and throughout the world. I am confident that by working with the Congress we can find a solution to this problem that will avoid a major setback in our peacemaking efforts. At the same time, we must move forward with current negotiations to reform the international payments system under the auspices of the International Monetary Fund. These negotiations are designed to increase the opportunities for all nations to trade and invest profitably. The U.S. has already presented proposals for deterring the growth of significant imbalances in international monetary affairs while preserving for each nation a wide freedom in choosing how necessary adjustments can best be accomplished. In addition, the system will also have to accommodate the increased payments flow and prospective reserve accumulations occasioned by higher oil prices. If, however, other nations share with us the will to preserve a healthy and growing world economy, I am confident that a mutually acceptable solution to this problem will be achieved. In practice, this means that our markets must increasingly be open to imports from developing countries--a condition that would be significantly facilitated by enactment of the Trade Reform Act. It also means that the Congress must continue to authorize and appropriate our fair share of both bilateral and multilateral economic assistance, including a substantial contribution to the International Development Association which helps the poorest countries. In 1973 we successfully negotiated a reduction of the United States share from 40 percent to one-third of IDA funds. We cannot let the action of the House in voting against IDA stand as our final answer. We will work hard with the Congress to ensure that this country continues to play a leadership role, consistent with our own economic situation, so that long-term economic development can continue to be planned in an orderly manner. Along with trade and monetary problems, new international agreements on investment policies and new mechanisms for dispute settlement are high on our negotiating agenda for the coming year. We must continue to work for economic arrangements which permit the beneficial flow of international investment so that all may derive the maximum benefit from their own resources. To that end, I am glad to be able to note that this week the United States completed the phaseout of controls on flows of capital from this country. The recent oil embargo and especially arbitrary increases in the price of oil have created major economic problems for many countries, including the United States. If continued, these policies would require enormous transfers of goods and assets from oil importing nations, transfers which would represent a serious burden for even the wealthiest countries and which would be virtually unbearable for the less developed countries. Our objectives are clear--we must get world oil prices down from levels that are arbitrary and exploitative. We must also cooperate to ensure that the international and domestic economic policies of the advanced countries do not compound the economic disturbances created by the current emergency but rather that we do all that can be done to contain and limit those disturbances. THE DOMESTIC ECONOMY Despite our general prosperity, inflation remains a most serious economic problem, not only in the United States but also for the rest of the world. We see clear evidence of this problem at every hand. World oil prices have gone up recently at dramatic rates. World food, metals and other commodities prices are also up sharply. Because domestic prices cannot be isolated from international prices, worldwide inflationary pressures have helped to drive up prices here at home. Inflation has been a continuous problem for nearly a decade, and it got worse in 1973. The result has been that people have come to expect continuing price increases--and to behave accordingly in their own economic life. Their behavior, in turn, adds further to inflationary pressures, contributing to a vicious inflationary spiral which is difficult to break. Some people have said that the best way to wring these inflationary expectations out of our economy is by taking the economy into a recession. I disagree. It is true that a lower level of economic activity would reduce demand and thus lower the pressure for higher prices. However, the cost of such a policy in terms of increased unemployment would simply be unacceptable. By the same token, I also reject the notion that we should totally ignore inflation and concentrate solely on stimulating higher levels of employment. This policy would also involve too high a cost since it would unleash a further acceleration of the inflation rate. In developing my economic policy for 1974, I have chosen what I believe is a sound middle road: to cushion the economic slowdown we expect during 1974 without providing additional stimulus for inflation. We expect this policy to reduce the rate of inflation by the end of the year. Should there appear to be a serious threat of a severe slowdown, then we will act promptly and vigorously to support the economy. As we cope with the challenge of inflation, we must recognize the clear lesson of recent years: While direct controls over prices and wages can help fight inflation in the short-run, they have a very limited useful life. Inevitably, their eventual effect is to create or aggravate significant distortions in production and distribution. Accordingly, I will continue to watch the wage-price situation closely and to pursue a policy of gradual, selective decontrol except in particularly troublesome areas. At the same time, those Federal programs that will help reduce inflation by increasing the supply of scarce resources will be strengthened. One key area where we can look forward to expanded supplies is that of food. With a new national farm policy that encourages rather than discourages output, we achieved a record harvest in 1973 and another record harvest now appears likely in 1974. Increased agricultural output is the only sure way to bring food prices down--and increased output is what our new policies are producing. Rapid inflation is not inevitable and it must not be tolerated. To regain control of inflation, however, will require patience and persistence over the long course. My Administration is dedicated to achieving this objective and we are confident that with the help of the American people we will succeed. Another most pressing economic problem-and a major contributor to inflation-is the energy crisis. As the cost of using our own fuel resources came to exceed the cost of imports in the 1960's, it became increasingly attractive for us to import oil and petroleum products. Unfortunately, our growing dependence on imports made our entire economy more vulnerable to outside forces. That vulnerability has been tested in recent months--as has the even greater vulnerability of the developed countries of Western Europe and Japan and the less developed countries which have no oil. Every American has learned the consequences of this vulnerability: short fuel supplies and higher fuel prices. To a large extent, our flexible, adaptable economy will solve the longer run energy problem through the normal workings of the marketplace. As energy prices reach somewhat higher levels than the bargain rates of the past, conservation will be encouraged while domestic energy production will be expanded. One example of normal market forces at work has been the recent shift to smaller cars with better gas mileage. Over the next few years we can also expect to see an expansion of coal production and new output of oil and natural gas. Nevertheless, we will still have to import some of the oil we will need in the immediate future. It is essential, therefore, that we seek a more reasonable price for oil in the world market. It is also imperative that we review our current and prospective supplies of other basic commodities. I have therefore directed that a comprehensive report and policy analysis be made concerning this crucial matter so that governmental actions can properly anticipate and help avoid other damaging shortages. Even with the inflation and energy problems, 1973 was a year of many important economic gains for American people. 
First, employment in 1973 increased by 2.7 million persons; this 3.3 percent rise in employment was the largest since 1955. New job opportunities greatly benefitted all categories of workers, including women, non-whites, teenagers, and Vietnam veterans. Unemployment reached low levels, especially for skilled workers. Second, the purchasing power of the American people reached new highs last year. Even after allowing for price increases, people are now consuming more goods and services than they did a year ago, or in any other year in the entire history of the United States. Not everyone's purchasing power went up, of course. Inflation took its toll on many families whose income did not rise as fast as that of the average American. It is for this reason that we continue to regard inflation as a very serious enemy. At the same time, however, we should not ignore the substantial economic gains that have been made. PERSPECTIVE ON 1974 We have known for some time that a slowdown in economic growth is inevitable in 1974. It has been clear that our economy has simply been growing at an unsustainable rate. Shortages of skilled workers, full utilization of plant and equipment in key industries, and short supplies of a number of essential raw materials have all provided clear indications that our rate of growth would have to taper off. Unfortunately, the very mild slowdown which we anticipated for 1974 now threatens to be somewhat more pronounced because of the oil embargo, the resulting shortages, and the oil price increase. We expect, therefore, that during the early part of this year output will rise little if at all, unemployment will rise somewhat and inflation will be high. Our objective, however, is to turn this situation around so that later in the year output will be rising more rapidly, while unemployment will stop rising and will then decline, and the rate of inflation will slow. ROLE OF THE FEDERAL BUDGET The budget that I will recommend to the Congress next week will help us achieve our goals for this period. It will support the economy, resisting a major slowdown, but it will not provide a degree of stimulation that could accelerate inflation. If future events suggest that a change in fiscal policy is desirable, I will promptly recommend the appropriate changes. In particular, I will not hesitate to use the stimulus of fiscal policy if it becomes necessary to preserve jobs in the face of an unexpected slackening in economic activity. For fiscal year 1975, my budget recommends total spending of $304.4 billion, an increase of $29.7 billion over the current year. The increase is being held to the minimum level necessary--nearly 90 percent of the increase is unavoidable under existing law. The budgeted increase in relatively controllable outlays is only 4.2 percent. Federal receipts should reach $295 billion during fiscal year 1975, an increase of $25 billion. The projected budget deficit is $9.4 billion. Under conditions of full employment, however, Federal receipts would be substantially higher and there would instead be a moderate budget surplus. The Federal budget remains an essential tool in the fight against inflation. With the energy supply limitations we are experiencing and the price pressures they create, budget discipline is still required. I have noted with satisfaction that most Members of the Congress have also recognized the need for budgetary discipline, and that work is going forward to establish a more systematic budgeting procedure. The Congress devoted considerable effort in 1973 to developing a mechanism for coordinating its individual spending decisions with the budget as a whole. I continue to support this effort, although I have been troubled by some of the extraneous amendments which have been added to some of the measures for achieving this goal. I urge the Congress to enact workable budget reform in this legislative session. TAX REFORM Our entire economy is affected by the incentives for job-creating investments that are embodied in our tax laws. Major steps have been taken to reform our tax laws in the past five years, but much remains to be done. Since 1969--primarily through the Tax Reform Act of 1969 and the Revenue Act of 1971--major changes have been introduced to make the personal income tax system conform more nearly to contemporary standards of fairness. Both the higher level of personal exemptions and the low income allowance have worked to free more than eight million low income families from their entire Federal income tax burden. The difference in the tax liability for single and married taxpayers has also been reduced. As a result of these and other tax changes, individual income taxes will be about $25 billion less in 1974 than they would have been under the old tax laws. The saving in the tax burden for a typical family will be more than $270, or the equivalent of two weekly take-home paychecks for the average worker. I look forward to working with the Congress during the next few months not only to simplify our tax laws themselves, but also to simplify the tax forms that individuals fill out and to distribute the income tax burden more equitably. Last April, the Secretary of the Treasury presented to the Congress a set of Administration proposals for major and fundamental tax reform. Included in these proposals were the establishment of a minimum taxable income so that no one could avoid paying a fair share of the tax burden, the establishment of new rules for taxing income from foreign sources, and also a limitation on artificial accounting losses to eliminate so-called "tax shelters." I urge the Congress to consider the Administration's tax reform proposals early in the year. I have also been concerned about the excessive burdens imposed on our low income elderly families by State and local property taxes. To deal with this problem, I have proposed a refundable tax credit for those low income elderly persons whose property taxes exceed five percent of their income. The proposal would also provide equivalent relief for the low income elderly individual who pays rent. I again urge the Congress to enact this very important proposal. FINANCIAL REFORM The health of our economy depends upon an efficient and flexible private financial system--commercial banks, thrift institutions, credit unions, and a host of other institutions and individuals that comprise the financial sector of our economy. The average family depends on these institutions, both to provide a fair and reliable return on its savings and to provide credit on reasonable terms when needed to buy homes, automobiles and other purchases. There have been occasions recently when this financial system has not worked as well as it should--occasions, for example, when mortgage lending has been very difficult to obtain. In large part these problems have been the result of legislation, regulations and institutional arrangements which were suited to an earlier time but which are now obsolete. To remedy this problem I submitted draft legislation last year which reflected the results of careful study by a Presidential commission and Government experts. I again urge the Congress to act promptly on this matter so that American families, businessmen, and local governments can be served by a financial system suited to the economic conditions of the 1970s. The Administration is also studying the competitive position of foreign banks within this country and of American banks abroad to make sure that discriminatory regulations do not prevent American banks and other financial institutions from doing business they are entitled to do. I will be following the results of this study with considerable interest and will submit to the Congress any proposals resulting from the study which seem desirable. A HEALTHY AGRICULTURAL ECONOMY Abundance is the primary goal of our farm policy--abundance that can guarantee lower food prices for every American and higher incomes for all American farmers. Five years ago, agriculture was a troubled industry: --Government controls were reducing incentives for production and costing the taxpayers over $3 billion a year in farm subsidies designed to hold down production. --Farm income was low ($14.7 billion) and the long hours worked by farmers earned them an average income that was 26 percent below the nonfarm average. Farm families had been leaving the farm at an average rate of over 100,000 a year. Today, that picture has been dramatically altered: --Farm markets have expanded dramatically. Farm exports have set new records in each of the last four years, becoming the largest single factor in the Nation's balance of payments and strengthening the dollar in international money markets. --Farm production has reached new record levels in each of the last three years, and a new record harvest should be forthcoming in 1974. --The billions of tax dollars which used to go for farm price support payments for basic commodities every year will be reduced to nearly zero. --Farm income has reached record levels. By 1973, the gap between farm income and nonfarm income had closed from 26 to 7 percent. Net farm income was up from $14.7 billion to $26.1 billion. We are making this progress not through more Government regulation but less. One of the proudest achievements of this Administration was the enactment of the Agriculture and Consumer Protection Act of 1973, which places production decisions where they belong--with farmers, not with the Government. A primary challenge for Federal agricultural policies now is to encourage greater production of agricultural goods-which will mean more income for the farmer, greater international trading benefits for the Nation, and reasonable food prices for the consumer. I am therefore asking the Congress to revamp the programs which still require restrictive Federal control over the production of some remaining farm commodities--especially rice, peanuts, tobacco, sugar, and extra long staple cotton. To further enhance agricultural activity, the Administration will also: --Promote longer-run soil and water conservation practices. --Consolidate the locations of local offices of Federal agricultural agencies-specifically, the Agricultural Stabilization and Conservation Service, the Soil Conservation Service, the Farmers Home Administration, and the Federal Crop Insurance Corporation--creating one-stop agricultural service centers on the local level to make things easier for the farmer and less costly for the Government. --Place high priority on directing agricultural research into those areas which will assure plentiful agricultural goods at reasonable prices, maintain our competitive advantage in world agricultural production, and protect the land. At my direction, Secretary Kissinger recently proposed to the United Nations that it convene a World Food Conference, a concern made urgent by acute food shortages in many parts of the world. This conference, to be held in November of 1974, should prove of particular importance to the American farmer, whose extraordinary productivity has made this Nation the world's leading food exporter and whose own prosperity will continue to increase as we help to meet the needs of a hungry world. Our farm policy must of course address not only the needs of the farmer but also those of the consumer. During 1973, we experienced a period of rapidly increasing food prices. Those prices leveled off in late 1973, but now we appear to be heading into a period of increasing food prices for at least the next few months. It is our intention to hold these increases to the smallest possible rate through executive actions such as lifting the quota on wheat imports, an action that I took last week. But the most significant force in the battle against higher food prices is higher production. This summer and fall, the large 1974 harvest should be coming on the market, serving as the best possible damper on higher prices. ECONOMIC SECURITY One of the most significant legislative achievements of 1973 was the enactment of the Comprehensive Employment and Training Act (CETA). A form of manpower revenue sharing, this bill transfers from the Federal Government to States and localities significant control over the design and operation of programs to improve the employability of the unemployed and the underemployed. CETA is a landmark of the New Federalism. It is also a landmark on the way to better manpower programs. Under this legislation, State and local governments will be able to use Federal funds to meet locally-determined needs and to devote special attention to employment problems with particular local impact-as, for example, those that might arise in certain areas as a result of the present energy shortage. In my new budget, I am including an additional $250 million for CETA in the current fiscal year, and $350 million in the year beginning July I, for distribution to areas with high unemployment. Overall, I am requesting more than $2 billion to fund our training and employment programs in the coming year. Other proposals related to economic security that I made to the Congress last year, and on which I again urge action, include: --The establishment of minimum vesting, funding and fiduciary standards for private pension programs, so that workers could have greater assurance of receiving the pensions they expect and deserve when they retire. I urge that we work together to resolve speedily the remaining disagreements and to enact responsible legislation which increases employee protection without burdening employers to such an extent that existing plans are jeopardized or new ones discouraged. --Extension to State and local governments of the law forbidding employment discrimination against older workers. --Improvement of the Federal-State unemployment insurance program in several ways: by increasing the State limits that keep some unemployed workers from receiving a reasonable proportion of their normal wage, by extending coverage to farmworkers, and by prohibiting payment of benefits to strikers while assuring benefits to non-participants unemployed as a result of a strike. These general improvements in unemployment insurance should be augmented by a special extension of present benefits for those specific areas of the country which experience particularly high levels of unemployment over the next 12 months. In addition, basic coverage should be provided for those in these areas who do not at present have any unemployment insurance. I will submit special legislation to achieve this purpose. I also continue to support legislation to raise the minimum wage. Higher prices have eroded the purchasing power of workers receiving the current minimum wage. But we must be careful to guard against enacting a bill which includes sharp increases or coverage extensions that would keep low income workers from being employed or a bill with a minimum wage for youths so high that we unwittingly deny them jobs. Finally, we must attack one of the most troublesome problems faced by both rural and urban areas; the existence of persistent and often severe unemployment or low incomes in areas whose character has been altered by changes in our economy and technology. Within the next several weeks, I will propose an Economic Adjustment Assistance program to help States and communities in overcoming problems caused by structural changes in their economies. This program would replace the present Economic Development Administration and the Regional Action Planning Commissions after a period of orderly transition. INCOME SECURITY One measure of a nation's character is the respect it accords to its elderly. Another is the way it helps those in need. We can be proud of the efforts we have made, but it is time to reassess where we are and what direction we should take in the future. 
We can take pride in the fact that: 
--Cash benefits under social security have risen from $26 billion in fiscal year 1969 to $63 billion in fiscal year 1975, primarily as the result of five benefit increases totaling almost 70 percent and reaching 19 million persons. --A program of Supplemental Security Income has been initiated and will soon be providing benefits to more than 5 million of the low-income aged, blind, and disabled, on a uniform, nationwide basis in a way that respects their dignity. But our income security programs need more than improved benefits. Over the past thirty-five years, a multitude of federally funded programs has grown up whose primary purpose is income security for those in need. Each of these efforts reflects a humane attempt to respond to a worthy goal. However, as cash, in-kind and service programs have rapidly expanded in the past few years, two things have become painfully clear: --First, the result is an extremely costly set of generally unrelated, uncoordinated programs with many unintended and undesirable consequences; and --Second, these efforts neither efficiently nor equitably accomplish the overall objective of assisting lower income families and individuals to achieve greater economic independence. The fact that a third of the new Federal budget--$100 billion--will be spent on income security programs in fiscal year 1975, compared to the $38 billion, or one-fifth of the budget, which they received just five years ago, highlights the need to rationalize and integrate our income assistance programs. As long ago as 1969, I called for a complete overhaul of our discredited welfare programs. I said then that "whether measured by the anguish of the poor themselves, or by the drastically mounting burden on the taxpayer, the present welfare system has to be judged a colossal failure." At that time, I proposed the Family Assistance Plan. Neither the Congress nor the country, accepted that proposal. I do not intend to resubmit a new version of the Family Assistance Plan. Since then, we have made a concerted effort to improve the administration of the existing programs. In 1973, for the first time in recent years, because of vigorous new Federal and State initiatives to enforce the rules more strictly, growth in the Aid to Families With Dependent Children case load was halted. But, in their overall impact, the welfare programs remain a failure and an outrage. As an example of the failure, recent studies have shown that fully 40 percent of the AFDC benefits being paid are either going to ineligible persons or are incorrect in amount. This performance is not just the result of fraud, although there is some of that. It is primarily and overwhelmingly the result of a system which is so complex and so riddled with obscure, obsolete and incomprehensible regulations that it defies fair and efficient administration. I plan to make a major new effort to replace the current maze of welfare programs with a system that works. This task will be difficult, but we have no other alternative, save further waste--both of lives and dollars. I welcome the evidence that thoughtful Members of the Congress, after careful study, have reached the same conclusion. While this effort goes forward, I will make every possible effort to improve the operation of the existing programs through administrative reforms, recognizing that a replacement system cannot be developed, enacted, and put into operation overnight. But, unless we move urgently to the development of a new system, efforts to improve the administration of the present programs wilt eventually be undermined by their basic structural flaws. 
In the development of my proposal, I will be guided by five principles: (1) All Americans who are able to work should find it more rewarding to work than to go on welfare. Americans would strongly prefer to have good jobs rather than a Federal handout. While we should provide cash assistance to those in need, we must always encourage complete self-support for those who are capable of it. (2) Cash assistance is what low-income people need most from the Federal Government. The people themselves, not the Federal Government, know their own needs best. (3) We need to focus Federal help on those who need it most. People in need should receive equal treatment from the Federal Government regardless of their place of residence. (4) The new system should be as simple as possible to administer with rules that are clear and understandable. It should be based on objective criteria rather than the personal judgment of administering officials. And it should be efficient. (5) This new approach should not require an increased tax burden for any of us. Too much of the income of all of us now goes to support Government. We help no one--certainly not those in poverty-by weakening our free enterprise system by even higher taxation. Starting from these basic principles, I believe we can develop a new system which would ensure that those who can help themselves do help themselves, and which would allow those who cannot help themselves to live with dignity and self-respect. IMPROVING OUR PEOPLE'S HEALTH In February of 1971, I outlined to the Congress a new national health strategy to assure that no American would be denied access to high quality medical care because of an inability to pay. Much has already been accomplished toward meeting that objective. A little over two years ago, I took special satisfaction in signing into law the National Cancer Act, which enabled us to launch an accelerated effort to conquer this dread disease. Considerable progress has been made in our attack on cancer and there is much hope that additional knowledge can be developed in the future. In the budget that I will submit to the Congress next Monday I plan to ask for an additional $100 million above last year's request of $500 million for the expanded attack on cancer. In addition, biomedical research in other areas, including heart disease, has been intensified--and the total 1975 budget for biomedical research will exceed $2 billion, more than double the total in fiscal year 1969. We are also making headway toward increasing the Nation's supply of health manpower. During the last ten years, first year medical school enrollments have grown by more than 55 percent. The number of other health professionals also can be expected to grow dramatically. Just last month, I approved legislation along the lines I requested in 1971 to permit the Federal Government to support the demonstration of health maintenance organizations across the Nation. During both 1974 and 1975, $125 million will be provided through health maintenance organizations to demonstrate the benefits of prepaid health care to our citizens. Federal programs to finance health services for the aged, for the disabled, and for low income persons have been greatly expanded. Since 1969, Medicare and Medicaid coverage has been extended to an additional 21 million aged, disabled, and low-income Americans. The range of services covered under Medicare and Medicaid has also increased. Consumer safety programs--to assure safe foods, drugs, cosmetics, and other consumer products--have received almost a fourfold increase in Federal funding since 1969. Despite all these advances, however, too many Americans still fail to receive needed health care because of its costs. And too often the costs of health care threaten our citizens with bankruptcy while the services that can prevent or cure disease are not fully utilized. 
As one of my major new initiatives for 1974, I shall soon submit to the Congress a comprehensive health insurance proposal which would: --Make available health insurance protection to millions of Americans who currently cannot obtain or afford the private health insurance coverage they need. --Provide all Americans with vastly improved protection against catastrophic illness. --Place a new emphasis on preventive health care. --Provide State and Federal subsidies for low-income families, and for those whose special health risks would otherwise make them uninsurable or insurable only at exorbitant expense. My comprehensive health insurance proposal will build upon the strengths of the existing health system, rather than destroying it. It will maintain the high quality of medical care without requiring higher taxes. It will be based on partnership, not on paternalism. And most importantly, it will. require doctors to work for their patients, not for the Federal Government. This plan would require that employers offer a comprehensive health insurance plan to all their full-time employees, with the employer paying a share of its costs. The role of private health insurance in financing health care would be expanded and the consumer's opportunity to choose between competing health insurance plans would be enhanced. In addition to this plan, there are a number of other health-related measures that I urge the Congress to enact this year. These include: --A Health Resources Planning Act, to help States and localities improve their planning and use of health resources; --New and expanded national health service scholarship legislation, to increase the number of Federal scholarships available to students in health professions, and also to help ensure that the Federal Government can meet its needs for physicians; and, --A general expansion of the guaranteed student loan program, to provide adequate financial assistance to all professional and graduate students, including health professionals. IMPROVING EDUCATION The Federal Government should provide strong leadership in assuring equal access to a high quality education for all Americans and in bringing about renewal and reform of all of our education programs. 
Since 1969, we have raised Federal spending for education from $4.3 billion to $7.6 billion--an increase of 76 percent. In special messages to the Congress on education in the past, I set forth five major proposals to improve American education. They were: --A new program of student assistance to help to ensure--for the first time in the Nation's history--that no qualified person is barred from attending college by lack of money. --A National Institute of Education, to be the focal point for educational research and development aimed at increasing our knowledge of how to help students learn. --A National Foundation for Higher Education, to encourage innovation in learning beyond high school. --An Emergency School Aid program to assist desegregating school districts. --A thorough reform of the programs for Federal support of elementary and secondary education, consolidating the myriad separate categorical grant programs in order to transfer educational decisions back to the State and local levels where they belong. The first four of these basic proposals have been enacted, in whole or in part, and a great deal has already been accomplished through them. As for the fifth, reform of Federal funding for elementary and secondary education, I believe that 1974 should be the year of its enactment. COLLEGE STUDENT ASSISTANCE The Basic Educational Opportunity Grant Program is the primary vehicle in my effort to ensure that no qualified student be denied a college education because of lack of funds. In my new budget, I am asking Congressional approval to strengthen this program by providing grants of up to $1,400 a year for needy students. Altogether, when combined with other student funding efforts, the Federal Government in the coming fiscal year would provide an estimated $2.2 billion of financial aid to post-secondary students, an increase of over $900 million from the level of five years ago. Since the present student assistance programs are targeted to help the neediest, and because the costs of higher education have risen dramatically, many middle income students are now finding it increasingly difficult to make ends meet. I therefore also recommend that the limit on total borrowing be increased so that professional and other graduate students will be able to find adequate student loans. EDUCATIONAL RESEARCH AND DEVELOPMENT When I originally proposed the creation of a National Institute of Education, I suggested that providing equal opportunity for quality education means, in part, increasing our knowledge about the ways that students learn and then changing the way we teach them. For too long we have followed the belief that bigger educational programs are necessarily better educational programs and that money alone can solve our educational problems. But now we are beginning to see that the quality of our thinking about education can be as important as the size of our educational budget. The National Institute of Education can help us to marshal our educational resources in ways which will produce the best results. It has already begun to provide the kind of leadership in educational research and development which I have long believed was needed. EDUCATIONAL INNOVATION BEYOND HIGH 
SCHOOL While the National Foundation for Higher Education which I proposed in 1970 has not been established, the Fund for the Improvement of Post-secondary education was set up by the Congress. The fund is now providing support for the development and demonstration of more effective approaches to college level education. Our initial assessment leads me to believe that the fund will, in the years to come, become the primary focal point for innovation in higher education. ASSISTING SCHOOL DESEGREGATION Under the Emergency School Aid Act of 1972, an estimated $467 million in Federal funds will have been provided to local school districts by the end of 1975 to assist in the process of elementary and secondary school desegregation, to encourage voluntary programs to overcome minority group isolation, and to assist in meeting the educational needs of children who, because of racial isolation, have not had an equal educational opportunity. By the 1975-1976 school year, the bulk of the problems incident to "de jure" segregation should have passed. However, to provide assistance to those other school districts which may still be required to take special desegregation measures as the result of court rulings, I have budgeted an additional $75 million for fiscal year 1975. In addition, the Federal Government will continue to provide civil rights education advisory activities to local districts to assist them in meeting any remaining problems. BUSING I have often .expressed my opposition to the use of forced busing for purposes of achieving racial balance. I have also proposed legislation which would dictate reasonable limits on the use of forced busing, and I have opposed the consolidation of school districts in an effort to achieve racial balance in the larger district. Such consolidation plans have only led to more busing and the eventual disappearance of the neighborhood school. The end result of an excessive reliance on forced busing and the imposition of arbitrary ratios has frequently been an increasing concentration of the poor and minorities in our central cities and the serious weakening of the very school systems which must serve them. In some cases, the education of minority children has actually suffered, not benefitted, from such plans. I shall continue to support the passage of legislation which makes busing only a last resort tightly circumscribed even then. I will also continue to work with the Congress to revise my proposals in light of unfolding events in this area. FUNDING ELEMENTARY AND SECONDARY 
EDUCATION I am encouraged by the interest the Congress has continued to show in legislation which follows the concepts put forward in my proposed Better Schools Act. I believe that meaningful compromise is now possible, and that we can at last reform and consolidate Federal grants for elementary and secondary education, vocational programs and adult education. I hope that the Congress will include four basic elements in this reform: 
--Consolidation of existing categorical grant programs. --Granting greater decision-making authority to State and local educational agencies. --Greater equity in the distribution of Federal funds to the States for the education of disadvantaged children. --Reform of the impact aid program to concentrate support in those districts where the Federal presence has substantially decreased the tax base, rather than those in which it has increased the tax base. Upon enactment of legislative authorities that accomplish these goals for elementary and secondary education, vocational programs and adult education, I will propose special supplemental appropriations to provide funding for the 1974-1975 school year. This funding would place most elementary and secondary education grant programs on a "forward funded" basis, letting State and local agencies know how much they will receive while plans for the next school year are being made. "Forward funding" is an important concept in the financing of education, and it merits the full support of the Federal Government. As I noted in my message sent to the Congress on education policy last week, I also recommend additional support for several other educational programs-some old and some new. These include: --An additional increase in aid to black colleges and other developing institutions during fiscal year 1975, thus quadrupling Federal funds for these important educational institutions since I took office. --Continuation and extension of the Head Start program, our single largest child development program. In 1975, Head Start will reach 282,000 disadvantaged youths year-round, as well as some 78,000 pre-schoolers during the summer-and it will extend its activities to include handicapped youth. --The consolidation of eight separate authorities for education of the handicapped into four broader and more flexible programs. NON-PUBLIC SCHOOLS I remain firmly committed to the principle of educational diversity. The continued health of the Nation's non-public schools is essential to this concept. Although governmental efforts aimed at supporting these schools have encountered difficulty in the courts, I believe we must continue our efforts to find ways to keep these schools open. For that reason, I continue to support legislation which permits tax credits for parents who pay to send their children to non-public schools. HELPING OUR VETERANS Twenty-nine million Americans living today have given military service to their country. As a group, veterans are among our most productive citizens. Studies show that they generally have higher incomes, more education, and better health than non-veterans of the same age. We can be proud of the veterans' contributions, but we must also be concerned for those veterans and veterans' families who remain in need. The assistance provided to veterans and their families in recent years has been substantial: --Total compensation payments for veterans disabled or killed in military service have been increased from $2.7 billion in 1969 to $3.9 billion in the coming fiscal year. --Medical care in VA hospitals and clinics has been greatly improved and expanded, with ten new or replacement hospitals now in service and five more in preparation. --Educational benefits per trainee have more than doubled since 1969. --Last year two key measures--one expanding health care and the other improving the national cemetery system for veterans--were passed and signed into law. --Of vital importance, the unemployment rate for Vietnam era veterans has been sliced from 11 percent in early 1871 to 4 percent by late 1973. As a result, Vietnam era veterans have a higher employment rate than others of their same age, a significant achievement that is well deserved. Earlier this week, in a special message to the Congress, I proposed additional legislation to help veterans in two crucial areas in 1974--pensions and education. My pension proposals would benefit some I million veterans and 1.3 million veterans' survivors who are in economic need because of disability, age, or the loss of a breadwinner. VA pensions already go a long way toward meeting such needs, but the pension structure itself is fraught with inequities and anomalies that are technical in nature but tragic in consequence. My proposals would correct these deficiencies. Veterans now in training require additional help if their GI bill allowances are to keep pace with rising costs. I shall therefore propose that GI bill benefits be raised by an average of 8 percent. I have also set a 1974 goal for the Government of placing an additional 1.2 million veterans in jobs or job training. There remain sizable numbers of educationally disadvantaged veterans and service-disabled veterans who have never taken advantage of Federal training opportunities and are now unemployed. I have directed that, as a matter of high priority, the Federal Government's efforts to reach these veterans be intensified and that they be counselled and encouraged to use the available services. EQUAL OPPORTUNITY FOR ALL 
AMERICANS This Administration has made a determined effort to secure equal opportunity for those who have been previously denied such opportunity. I am personally very proud of the success those efforts have already achieved, and I am committed to building on that success in the future. PROGRESS FOR MINORITY GROUPS Members of racial minority groups have made considerable strides toward equal opportunity in recent years. The following are among the more notable benchmarks of this progress: --Setting an example as an Equal Opportunity Employer in the past five years, the Federal Government has added more than 35,000 minority group members to its civilian employee roles. --In the Armed Forces, more than 850 minority-group cadets are now enrolled in the military academies; and whereas prior to 1971 only four minority group members had ever achieved general or flag rank in the armed forces, now sixteen serve on active duty as generals and admirals. 
--Federal aid to minority business enterprises-- one of the cornerstones of the Administration's effort to open new economic horizons for minority group members-has nearly tripled since 1970. --Civil rights enforcement activities have continued at a vigorous level, with their funding substantially increased. --Since 1969, combined Federal expenditures on civil rights activities and minority economic development programs have grown from less than $1 billion to $3.5 billion. --Five years ago 68 percent of all black children in the South were still attending all-black schools. Now that figure has been reduced to 8 percent, and the dual school system has been virtually eliminated. --The Government has also sought to expand job opportunities through legal actions of its own against those who may be engaged in discriminatory practices. During 1972 and 1973 the Department of Justice initiated 34 pattern and practice lawsuits against approximately 207 defendants. These suits directly covered more than 248,803 employees. During the same period of time, approximately 37 cases were fully resolved by entry of decrees and an additional six were partially resolved by the entry of decrees. The decrees entered in those two years alone covered more than 217,000 employees and provide specific goals for the hiring of more than 21,800 minorities and women in traditionally white and male jobs. In addition, those decrees provide new transfer of seniority rights for approximately 12,700 minorities and women and provide for back pay awards which are estimated to amount to well over $6,000,000. The real story lies not in these figures themselves, but in the facts and the attitudes they represent. They do not represent a flamboyant promise, but rather a quiet determination to work not only toward the symbols but also toward the substance of equal opportunity. They represent an effort to build foundations that will last--in particular, the foundation of economic independence, and of a basic faith in the equal dignity of mankind. JUSTICE FOR AMERICAN INDIANS For too many years the American Indians-the first Americans--have been the last Americans to receive the rights and opportunities to which they are entitled. This Administration has taken the initiative to change this picture. For its part, the Federal Government must put behind it the role of autocratic manager of Indian reservations. We shall continue to encourage Indians and their tribal governments to play an increasing role in determining their own future. We are also particularly determined to defend the natural resources rights of Indian people. The last five years have been historic steps in Federal Indian policy. In 1971, we worked closely with Indian leaders to achieve a settlement of Alaska Native claims, a settlement consistent with America's sense of fairness and also indispensable to the growth and development of all of Alaska. We also returned lands taken away long ago from the Taos Pueblo at Blue Lake. We returned lands wrongfully taken from the Yakima people. Because the Menominee people have seen their tribal states involuntarily terminated but had nevertheless kept their land and their tribal structure together, the Congress enacted and I signed the bill which restored the Menominee tribe to trust status. In the courts, we are forcefully asserting Indian natural resources rights, as we have done in protecting Indian rights in Pyramid Lake. One measure of our attempt to foster a better, more humane policy is the level of Federal funding benefitting American Indians--over twice what it was five years ago or about $ 1.6 billion. I am especially encouraged by the fact that the rate of infant deaths, pneumonia, influenza, and tuberculosis is significantly lower among Indians than ever before. Although we have not yet achieved our full goals of health and educational services for the Indian people that are fully compatible with those of the general population, this progress demonstrates our continuing commitment. The Congress has shared in these accomplishments in a spirit of bipartisan cooperation. I hope that I will soon have on my desk two more enactments on which Congressional action is progressing: measures to speed Indian economic development and to upgrade the position of the Commissioner of Indian Affairs to the Assistant Secretary level. Also still awaiting Congressional action are four other proposals I have submitted previously: to permit turning over to Indian tribal governments the management and control of Indian programs; to create an Indian Trust Counsel with authority to safeguard Indian natural resources rights; to help ensure that funds for Indian education actually reach Indian children; and to provide greater local control over federally assisted reservation programs through a program of tribal grants. Looking forward, I shall ask that the Bureau of Indian Affairs make specific plans to accelerate the transfer of significant portions of its programs to Indian tribal management, although I repeat my assurance that, while accelerated, these transfers will not be forced on Indian tribes not willing to accept them. THE SPANISH-SPEAKING The Spanish-speaking citizens of our Nation face special problems in obtaining equal opportunities because of language and cultural barriers. For that reason, my Administration has made a special effort to expand those opportunities. Our progress on this front is reflected in many ways. Nearly 3,800 Spanish surnamed Americans have been employed by the Federal Government, despite an overall reduction in Federal jobs. The Small Business Administration has also increased its loans to Hispanic businessmen, reaching a total of $109 million in fiscal year 1973. In 1969, the Cabinet Committee on Opportunities for the Spanish-speaking people was created. The Cabinet Committee has both made the Government more aware of the needs and the talents of Spanish-speaking citizens and helped to expand Federal employment of the Spanish-speaking. Since the authorization for this organization expires this year, I am asking the Congress to extend its life through June 30, 1975. The Cabinet Committee on Opportunities for the Spanish-speaking serves to focus the Administration's continuing efforts in this important area of concern. THE RIGHTS OF WOMEN Both men and women have become increasingly aware of the pattern of sometimes blatant but often subtle discrimination to which women are subjected. Some of this discrimination can be erased by existing law; some requires new law; some would be rectified by the Equal Rights Amendment, now nearing ratification by the required three-fourths of the States. It is my hope that the Equal Rights Amendment will be ratified speedily so that equal justice under our laws will become a reality for every American. One of the primary goals of this Administration is to ensure full equal employment opportunity for women by striving to open to women jobs that previously were reserved for men, often simply by habit or custom. Specifically, we have moved vigorously both to enforce the law and to lead by example---by insisting on equal employment and promotion opportunities within the Federal service, by promoting more women into the professionally critical areas of middle management and by continuing our special recruiting drive to bring more women into the highest levels of Government. To help advance these goals I have appointed the first woman Counsellor to the President, and she, in turn, has set up a new Office of Women's Programs within my executive office. We are particularly proud that this Administration is the first to have women as heads of three independent Federal agencies--the Atomic Energy Commission, the Federal Maritime Commission, and the United States Tariff Commission. The effort to improve the economic status of women outside the Government is also continuing. The Equal Employment Opportunity Commission, which has been given enforcement power in the Federal Courts, has reported a marked increase in its activities to end sex discrimination in employment. We will continue to pursue all these efforts with vigor. This emphasis is especially appropriate as we approach 1975, which has been declared International Women's Year by the United Nations. One especially invidious form of sex discrimination in particular is ripe for correction now through new legislation: the discrimination that often denies women equal access to credit. In an economy that increasingly operates on credit, this is a particularly grievous practice. The Congress already has before it a proposal to ensure that credit is extended to all persons on an equitable basis, without regard to their sex or marital status. This Administration strongly supports this proposal and is sending to the Congress amendments which we believe will strengthen it even further. I urge prompt consideration and passage of this vital legislation. PROTECTION AGAINST CRIME AND INVASIONS OF PRIVACY Over the past five years I have had no higher domestic priority than rolling back the tide of crime and violence which rose in the 1960s. I am therefore especially pleased with the progress we are making on this front: --After 17 years of continuous and often dramatic increases, crime in 1972 registered its first overall decline. Although in 1973 it again registered a slight increase, it still held below the level of 
1971. Now that the momentum of increase has been broken, I am confident that we can look forward to further reductions in crime rates in the years ahead. --Serious crime in our largest cities was actually reduced by 13 percent between 1971 and 1973. --In Washington, D.C., where the Federal Government has special law enforcement responsibilities, crime has been cut in half since 1969. Indictments and convictions of organized crime racketeers have more than tripled since 1969, thanks in large measure to the 1970 Organized Crime Control Act and to expanded Federal interagency strike forces. In addition, of course, the riots, urban terrorism and burnings of the 1960s have now become a thing of the past. These indications of success do not mean that we should slacken our anti-crime effort, but that we should intensify it. Key elements of our strategy to do so--most of which will require the assistance of the Congress--include: --Comprehensive reform of the Federal Criminal Code. Last year I submitted a proposal which was based upon the work of the Justice Department and a five-year study completed by the National Commission on Reform of Federal Criminal Laws. The Federal criminal code has not been completely revised in a quarter century and the need for reform is urgent. I call upon the Congress to act expeditiously in reforming our criminal code, to make it both more workable and more responsive to the demands of our complex society. --Restoration of the death penalty under the Federal Criminal Code for several especially heinous specific crimes which result in the death of innocent victims. Examples of such crimes are hijacking, kidnapping, or bombing. --Increased Federal assistance to State and local law enforcement agencies. For the next fiscal year, I propose funding through the Law Enforcement Assistance Administration of $886 million--up from only $60 million in 1969. --Increasing the resources available to the U.S. Attorneys' offices throughout the Nation----offices which have, in the last three years, increased the number of criminal convictions by 28 percent. --Creation of additional Federal judgeships to assure speedier disposition of criminal cases. Legislation to accomplish this goal is now before the Congress. --Comprehensive improvement of Federal correctional programs. Already 15 additional correctional institutions have been built, acquired or begun. My 1975 budget request would represent a tripling of 1969's budget levels. --A new effort to deal more effectively with employment problems caused by the increase in the number of illegal aliens entering this country. Legislation to achieve this objective is also before the Congress. PROTECTING THE RIGHT OF PRIVACY One of the basic rights we cherish most in America is the right of privacy. With the advance of technology, that right has been increasingly threatened. The problem is not simply one of setting effective curbs on invasions of privacy, but even more fundamentally one of limiting the uses to which essentially private information is put, and of recognizing the basic proprietary rights each individual has in information concerning himself. Privacy, of course, is not absolute; it may conflict, for example, with the need to pursue justice. But where conflicts occur, an intelligent balance must be struck. One part of the current problem is that as technology has increased the ability of government and private organizations to gather and disseminate information about individuals, the safeguards needed to protect the privacy of individuals and communications have not kept pace. Another part of the problem is that clear definitions and standards concerning the right of privacy have not been developed and agreed upon. I have therefore ordered an extensive Cabinet-level review--which will be undertaken this year--of both government and industry practices as they relate to the right of privacy, of the conflicts that arise and the balances that must be struck between legitimate needs for information and the right of privacy, and of those measures--including appropriate legislation-that can be taken to ensure that these balances are properly struck. ENDING DRUG ABUSE During the decade of the '60s, increasing numbers of Americans--including a high percentage of young people--each year turned to heroin and other drugs in search of "new highs" and "synthetic solutions" to the problems of life. In this retreat from reality, the Nation's drug problem grew dramatically. Residents of our proudest cities were gripped by fear as addicts turned to crime to support their habits, and thousands of families suffered devastating personal tragedies. I am pleased to be able to report that since then, Federal spending on drug treatment and enforcement have increased tenfold, and progress has been made. We have indeed turned the corner on hard drugs: --Better drug law enforcement, at home and abroad, has caused an acute heroin shortage throughout much of the country. --Enough treatment capacity has now been created so that virtually all addicts who want medical help and counselling can get it. --Our drug abuse indicators all suggest that we have at last succeeded in reducing both the total number of heroin addicts and the number of new addicts. Nevertheless, the drug battle is far from over. For the sake of the next generation, I am determined to keep the pressure on-to ensure that the heartening progress made to date is translated into a lasting victory over heroin and other drugs. As enforcement efforts meet with success in one area of the world, pressure increases on other trafficking routes. To meet these new threats, we will step up our support of joint drug enforcement programs. I have also directed that plans for increased vigilance at our own borders be put into effect. In the treatment area, we are intensifying our efforts to encourage hard-core addicts to undergo treatment. To provide added incentive for those not motivated to seek help on their own, I have directed Federal agencies to expand their support for local programs which direct addicts charged with crimes into treatment pending trial and sentencing. Continued progress will also require help from the Congress: --I will shortly recommend severe new penalties for both heroin traffickers and those engaged in illegal distribution of other illicit drugs. This legislation will supplement my proposals currently pending before the Congress. --The Psychotropic Convention, a key international treaty regulating manufactured drugs worldwide, has--after 2 1/2 years--still to be ratified. Affirmative action in this session is of the utmost importance. I will continue to pursue a balanced approach to the drug problem in the next year by emphasizing both vigorous law enforcement, and treatment and rehabilitation programs to help speed the return of ex-addicts to productive lives in society. ENHANCING THE ENVIRONMENT Both our Nation and the world have made imposing strides during recent years in coping with the problems of our natural environment. Building upon well-justified concerns, we have created institutions, developed policies and strategies, and deepened public understanding of the problems that face us. Now we are entering the second phase of environmental action. It may prove to be a more difficult period. In this second phase, we will be looking at our environmental problems in new ways which are more complex and far-reaching than those to which we have been accustomed. We must be concerned not only with clean air, clean water and wise land use but also with the interaction of these environmental efforts with our need to expand our energy supplies and to maintain general prosperity. In facing up to these tough, new problems, we can draw strength from the progress we have already made and from the knowledge that there can be no turning back from our general commitment to preserve and enhance the environment in which we live. Our record over these past five years includes the vigorous enforcement of air quality legislation and of strengthened water quality and pesticide control legislation, the enactment of new authorities to control noise and ocean dumping, regulations to prevent oil and other spills in our ports and waterways, and legislation establishing major new parks, recreation and wilderness areas. We have also tried to reorganize the Federal structure in ways that are more responsive to environmental needs. The National Environmental Policy Act, passed in 1969, has provided a basis for reform in our Federal agencies and has given citizens a greater opportunity to contribute to environmental decisions. In 1970, I established the Environmental Protection Agency and National Oceanic and Atmospheric Administration to provide more coordinated and vigorous environmental management. Also in that year, I appointed the first Council on Environmental Quality. PRODUCING RESULTS The results of our vigorous anti-pollution efforts are now being seen and felt. In our major cities, levels of dangerous sulfur oxides and particulates have declined, and pollutants from automobiles have been reduced. Water pollution is being conquered, assisted by a massive Federal commitment of over $14 billion in municipal treatment plants during this Administration. Major misuses of pesticides are now under control, and major sources of noise are being regulated for the first time. During these five years, Federal agencies have acquired over 800,000 additional acres for preservation for future generations, many of them near our heavily populated urban centers such as New York and San Francisco. In addition, the Legacy of Parks program, which I initiated in 1971, has made massive strides in bringing parks to the people. To date, 400 separate parcels covering almost 60,000 acres of under-utilized Federal lands in all 50 States have been turned over to State and local governments for park and recreational use. Many of them are near congested urban areas. We will continue to expedite transfer of additional surplus properties to State and local governments for park and recreation use. IMPROVING THE WORLD ENVIRONMENT On our small planet, pollution knows no boundaries. World concern for the environment is as necessary as it is encouraging. Many significant international actions have been taken in recent years, and the United States can be proud of its leadership. These actions have included the signing of international conventions to protect endangered Species of wildlife, to regulate ocean dumping, to extend the national park concept to the world, and to control marine pollution. A United Nations Environment Program was established last year. With it, the UN Environment Program Fund came into being, fulfilling a proposal I had made in 1972. Under the US-USSR Environment Agreement, which I signed in Moscow in May, 1972, Soviet and American scientists and environmentalists have been actively working together on serious environmental problems. THE CHALLENGE AHEAD As part of this Administration's continuing effort to conserve outdoor recreation areas, my new, budget will propose full funding of the Land and Water Conservation Fund for 1975. Nearly two-thirds will aid State and local governments in acquiring their own recreation lands and facilities. Coupled with the change I have proposed in the formula for allocating funds to the States, this measure would encourage the development of more recreational sites closer to the places where people live and work. This year we have the unique opportunity and responsibility to determine the future use of enormous land areas in America's last great frontier--Alaska. Last month, in accordance with the Alaska Native Claims Settlement Act, I transmitted to the Congress recommendations that would add 83.47 million acres in Alaska to the National Park, National Forest, Wildlife Refuge and Wild and Scenic Rivers Systems. If the Alaska frontier is thoughtlessly developed, it will be gone forever. But we now have the opportunity to make considered judgments as to the appropriate uses of these outstanding Alaskan lands for the American people of all future generations. This session of the Congress has before it 17 major natural resources and environment proposals that I have previously submitted, and on which I again recommend action. These include: --Department of Energy and Natural Resources: While I discuss this new department elsewhere in this message, I want to reemphasize that I consider it of cardinal importance in ensuring that complex, interrelated environmental and natural resource issues receive an appropriately wide policy overview and administrative coordination. ---National Land Use Policy: Adoption of the National Land Use Policy Act, first proposed in 1971, remains a high priority of my Administration. This legislation would reaffirm that the basic responsibility for land use decisions rests with States and localities--and would provide funds to encourage them to meet their responsibility. I am pleased that the Senate has passed legislation incorporating some of the policies that I proposed. I urge the Congress to pass legislation which would assist States and localities, but which does not inject the Federal Government into their specific land use decisions. --Coastal Wetlands: These environmentally vital wetlands are increasingly threatened by development. My proposed Environmental Protection Tax Act would amend Federal tax laws to discourage the unwise use of these areas, and to enhance our opportunities for sound land use planning within the coastal zone. --Wilderness: Traditionally, we have looked westward for our wilderness areas. Last year, however, I proposed that 16 Eastern areas be designated as "wilderness" and that 37 others be studied for possible wilderness designation. --Historic Preservation: Because we have an irreplaceable historic and architectural heritage, I have proposed an Environmental Protection Tax Act to discourage the demolition of historic structures and to encourage their rehabilitation. --Big Thicket National Biological Reserve: The Big Thicket area of east Texas is a biological crossroads unique in the United States. I am gratified that the House has acted and I urge the Senate promptly to consider my proposal to preserve key segments of the Thicket in a Big Thicket National Biological Reserve. --Big Cypress National Fresh Water Reserve: Protection of the Big Cypress Swamp in Florida is essential to the preservation of the water supply in the Everglades National Park. I have recommended legislation which would authorize the acquisition of over 500,000 acres, enabling us to protect this vital water supply. --Public Land Management: The Secretary of the Interior needs additional authority to protect the environmental values of our public domain lands. I again urge that he be given that authority. --Controlling Pollution: Three of my legislative proposals aimed at controlling pollution have not yet received final Congressional action: --Toxic Substances: New chemicals with unknown environmental effects come into use each year. Authority to test these substances and to restrict their use in the event of danger, while still permitting the orderly marketing of needed chemicals in a timely fashion, is highly desirable. --Hazardous Wastes: Disposal of wastes on land is increasing due to advances in industry and technology and because of our stringent controls on air and water pollution. These wastes can be hazardous to human health and other forms of life. My proposal provides for national standards for treatment and disposal of hazardous waste with primary regulatory responsibility resting with State governments. --Safe Drinking Water: The water we use in our homes should not endanger our health. Under my proposal on safe drinking water, Federal standards would provide health protection by requiring strict limitation of any contaminants in drinking water, but primary enforcement responsibilities would be left to the States. Alternative legislation is now being seriously considered by the Congress which would require unnecessary Federal standards on operating treatment plants, generate a domineering Federal enforcement role, and create several new categorical subsidy programs. COMMUNITY DEVELOPMENT Although American communities share many of the challenges of our age, the relative intensity and the particular nature of these challenges vary sharply from one community to another. The current way of providing most Federal aid to our communities--with each dollar tied to a string pulled and manipulated by a Federal planner--is wrong. Much of the money that pays the Federal planners could better be spent in the local community; the decisions made by the planners could better be made by the people who live on the scene. In these past few years, we have sought to change the old system. We have recognized that the Federal policy that will work best is one that helps the people of a particular community define their own needs and meet those needs in the way which they consider best. While in this Administration we have tried to be generous, we have also tried to grant communities greater freedom to set their own priorities. Since 1969, we have: --Spent twice as much money on community development programs as the Federal Government had spent for this purpose in the entire previous history of the Nation. --Reduced the red tape and arbitrary restrictions on local action that were so much a part of these programs in the past. --Moved authority for administering community development programs from Washington to the field, where administrators are more accessible to local officials, and where they can become more familiar with local problems. --Stepped up Federal support for State and local planning and management, again spending more for this purpose than had been spent in all previous years combined. As a result, not only have cities received more Federal dollars, but they have been able to accomplish more with each dollar than before. Despite this progress, we need a much more sweeping reform than has been possible under existing laws. Therefore, I once again urge passage of The Better Communities Act, a $2.3 billion bill which would give local officials new flexibility and provide greater effectiveness in the expenditure of Federal community development funds. This legislation would consolidate seven categorical grant programs into a single program. Funds would be distributed on the basis of need, and then local communities could decide for themselves what projects should come first. Thus we could eliminate a mountainous volume of red tape and allow local government to play a larger role in determining their own destinies. Two Congresses have now addressed community development legislation. Both of them have agreed, for the most part, with the basic principles and approaches that the Better Communities Act represents. But we have still had no action. Cities and towns that have counted on having this legislation in effect in the next fiscal year now face an uncertain future. I urge the Congress to move ahead as quickly as possible with the Better Communities Act--and I pledge every effort to work out our remaining differences so that our cities and towns can benefit from this program as soon as possible. I also urged the 93rd Congress to pass the Responsive Government Act that I submitted last year. This measure would enable State and local officials to improve their planning, decision-making and managerial capabilities through broadbased, flexible grants. RURAL DEVELOPMENT Over $12 billion has been invested in rural development through Agriculture Department programs alone during the five years of this Administration. Annual Federal funding for these rural development programs has been tripled during that time. These funds have been spent for: --Rural housing, where more than $6.4 billion has been provided through 487,000 housing loans. --Electrification and telephone systems, where over $3 billion has been spent to bring service to 177,000 new rural consumers. --Water and waste disposal, where some 8,500 loans and grants totaling $1.4 billion have been provided to rural communities for water and waste disposal systems. --Loans to farmers, who received more than 489,000 loans totaling over $4.2 billion. In addition to these efforts under Department of Agriculture programs, almost 200 other Federal programs have had a significant impact on rural areas. As a result, rural residents receive as much Federal support per capita as residents of urban areas. During the past year we have markedly increased our activity on behalf of the Nation's rural residents: --During 1973, the Rural Development Act was funded for the first time to provide over $750 million in loans and grants to States under procedures which give them a new flexibility in promoting rural industrialization and in improving the quality of rural life. --An interim rural housing policy was developed, placing greater emphasis on more effectively utilizing existing housing and making Farmers Home Administration programs more responsive to those with the greatest housing needs. --To ensure continuing Government attention to rural development needs, this Administration has also created both a special Cabinet-level Rural Development Committee and the new post of Assistant Secretary of Agriculture for Rural Development. As we look to the future patterns of national growth, we must never forget that the prosperity, the vitality and the character of rural America are essential cornerstones of our Nation's balanced growth. It is essential that rural America receive its proper share of our attention--and I am determined that this shall be the case. HELPING DISASTER VICTIMS Seldom is swift and effective Government action needed so urgently as when a natural disaster strikes. Since taking office, I have had to declare over 160 major disasters in 42 States and in 3 territories. In recent years, the amount of Federal assistance given to disaster victims has been greatly expanded, and we have also pressed an intensive effort to provide this aid more equitably and expeditiously. Since more than 90 percent of all property damage resulting from natural disasters is caused by floods, I was especially pleased by the Congress approval last year of our proposed Flood Disaster Protection Act, which significantly expands and improves the national flood insurance program. More remains to be done, however, if we are to meet our basic humanitarian responsibility to those who fall helpless and innocent victims to nature on the rampage. Therefore, I have also proposed a Disaster Preparedness and Assistance Act, which places new emphasis on the essential element of preparedness, while also increasing the role of State and local officials in allocating Federal disaster funds and cutting the tangle of red tape. It also provides for the automatic use of Federal resources when major disasters strike, and it includes generous grant features for those individual disaster victims unable to repay Government loans, as well as for communities faced with the task of restoring damaged public facilities. That natural disasters will continue to strike is certain; the only uncertainty is how well prepared we will be. As a generous and compassionate Nation, we should be prepared to give the victims of these disasters the prompt and effective help they so desperately need. BETTER HOUSING FOR ALL As I have stated many times, this Administration will not waver from the Federal commitment first outlined in the Housing Act of 1949: "a decent home and a suitable living environment for every American family." The state of America's housing will continue to depend on the state of America's economy more than on any other factor. The forces of the marketplace are the forces that count the most-families with sufficient real income and sufficient confidence to create an effective demand for better housing on the one hand, and builders and credit institutions able to respond to that demand on the other. The Federal Government must play a major supporting role through its actions in the mortgage credit market and its help for low income families who need assistance in obtaining adequate housing. Last September, as credit for housing was becoming increasingly scarce, the Administration acted to make more credit available to home buyers. Recently, mortgage market conditions have begun to improve. However, to assure continuing improvement, I recently authorized a reduction in the maximum allowable interest rate for mortgages insured by the FHA, the Farmer's Home Administration and VA--a more than $6 billion mortgage insurance program that will assist in financing the construction of up to 200,000 housing units. These actions should have a favorable impact on housing production. If the anticipated results are not fully achieved I will recommend further action to ensure a reasonable level of production. In the last five years a substantial effort has been made to address the country's housing problems: --Largely because of a general upswing in the economy, housing production has occurred at record levels. --FHA mortgage insurance has enabled nearly 3 1/2 million families to purchase homes. --Over two million units of subsidized housing for low and moderate income families have been approved, more than during the previous 33 years of federally subsidized housing programs. --Over $1.4 billion has been committed to improving and modernizing existing public housing. --Subsidies to local housing authorities have grown from $33 million in 1969 to $350 million in 1974. Even as good housing has become a reality for most Americans, it is clear that important problems still exist. Two are especially significant. First, our credit institutions often encounter problems in providing adequate housing credit. Second, too many low income families are unable to obtain adequate housing--even as good housing sits vacant in their community. We must help them to meet their needs. In order to increase the availability of housing for all families, I urge passage during this session of two key measures I have already proposed: --The Financial Institutions Act to enable savings and loan associations to compete more effectively for funds during periods of tight money, as well as to encourage increased investment in housing through a tax credit on income earned from residential mortgages. --The Administration's proposed Housing Act which would ease the present tight mortgage credit situation and make home ownership easier in the long term by: --Authorizing increases in the permissible mortgage amounts eligible for FHA insurance. Permitting home buyers to pay market interest rates on FHA and VA insured mortgages, and reducing the cost of buying a home by doing away with the present system of charging points on mortgage loans. --Authorizing on an experimental basis more flexible repayment plans on FHA insured mortgages. --Authorizing more flexible interest rates, longer repayment terms and higher amounts for mobile homes and home improvement loans. This legislation would extend authority for extensive experiments with a new approach--direct cash assistance--for addressing the housing problem of low income American families. Despite the commitment of over $66 billion, evidence has clearly shown that the subsidized housing programs for low income families have not worked well. Instead of programs to treat symptoms, I will continue to press for a longer term solution-which goes to the root of the problem-lack of sufficient income--and which permits the private housing market to work in as efficient a way as possible. Additionally, this legislation would improve the operation of our existing public housing projects, by helping them move to a more effective, efficient and self-sufficient basis of operation. IMPROVING TRANSPORTATION The energy crisis has made urgent what once seemed only necessary: the building of a transportation system that permits all Americans to travel efficiently and at reasonable cost. While some elements of our transportation system--such as the Federal highway network--have been dramatically improved or expanded in the past decade, others--notably the railroads--have fallen into serious difficulties. It is also apparent that our public transit system must be greatly improved within our urban centers. The measures already taken and others which I shall propose this session are particularly important in helping to deal with the energy crisis by encouraging a more sensible utilization of our transportation resources. During the past four years, several key measures have helped lay the basis for a greatly improved transportation system. Under the Urban Mass Transportation Act of 1970, we increased annual Federal aid to urban public transportation to $I billion by 1973--8 times the level of 1968--and in 1973 another $3 billion was made available for the years immediately ahead. For the first time since World War II the downward trend in transit ridership has been reversed, and is now moving upwards. And for the first time, under the provisions of the Federal-Aid Highway Act of 1973, States and localities can now use a portion of their Federal highway funds for public transit purposes. There has also been improvement of rail passenger service under AMTRAK, a public corporation created by the Rail Passenger Service Act of 1970. After years of steady decline in rail passenger service, the past year saw a 14 percent increase in the number of passengers carried on AMTRAK. Just this past year, we also went to work to avoid a major rail crisis through passage of the Regional Rail Reorganization Act of 1973, which provides for the restructuring of the bankrupt railroads of the Northeast and Midwest region into a streamlined system. By 1976, we hope that the affected railroads will be able to operate profitably and can survive as producers, not consumers, of tax revenues. Significant new initiatives have also been taken in airport and airway development, making vitally needed improvements in the merchant marine, and in promoting transportation safety, especially on our Nation's highways. Clearly, however, there is still much to be done. It is my hope that 1974 will be the year when we make major advances by enacting two critical transportation bills. One of these proposals, which I will send to the Congress in the near future, would give our communities not only more money but also more freedom to balance their own transportation needs--and it will mark the largest Federal commitment ever to the improvement of public transportation. This bill would increase Federal assistance for metropolitan areas by nearly 50 percent over the level of fiscal year 1974. More than two-thirds of those funds would be allocated by formula to State and local governments and those governments could better determine their own transportation priorities, choosing between construction of highways or public transit systems, or the purchase of buses or rail cars. Additional transit aid would also be made available to rural communities for the first time. Under this bill resources would also be available for the first time to augment the operating funds for public transportation systems in both urban and rural areas. By permitting Federal resources to be used for operating purposes, this proposal should make it unnecessary to establish a new categorical grant program for transit operating subsidies, as is now contemplated in bills before the Congress. As a second major transportation initiative this year, I shall propose that we modernize the regulatory system governing railroad operations. This legislation would make it easier for railroads to consolidate service on a sustainable basis. It would make changes in the system of rate regulation to allow rail carriers to compete more effectively with one another and with alternative modes of freight transportation. Discriminatory State and local taxation of interstate carriers would be barred. It would also provide $2 billion in Federal loan guarantee authority to finance improvements in rights-of-way, terminal and rail plant facilities, and rolling stock, where necessary, which would be a major step in our effort to improve the Nation's railroad system. Additional transportation measures I shall soon propose will include: --Improvements in highway safety through the earmarking of approximately $250 million of the 1975 Federal highway program for the elimination of death traps from the highways--by, for example, improving high-hazard intersections and replacing dangerous bridges. New bonus grants to the States will also be initiated to encourage the adoption of improved safety legislation and to reward States for outstanding safety accomplishments. --A restructuring of the airport and airway financing system to allocate costs more equitably among the users of our airways and to provide more flexibility in the use of funds. DISTRICT OF COLUMBIA Last Christmas Eve, when I signed the new home rule bill into law, the Nation's Capital reached a significant milestone. If the voters of the District accept the proposal in the forthcoming referendum, the city will soon have its first elected mayor and city council in 100 years. In addition to giving the citizens of our Nation's Capital the right to elect their own officials and a greater role in decisions affecting local affairs, the act also transfers to the District functions now carried out in Federal agencies which should rightfully be under local control. In order to accomplish this transfer of responsibilities to the local government, much work will have to be done. This Administration will make every effort to assist in that transfer and to ensure that it is both timely and effective. While our attention to the affairs of the District of Columbia has been captured by the transition to home rule, we must not ignore another important task before us. As the city moves into a new era of self-government, it must also prepare for the Nation's celebration of the Bicentennial. A Federal Bicentennial Task Force has been working to ensure that the Federal Government meets its financial and program commitments in the Nation's Capital. Under the leadership of the Bicentennial Coordination Center, which I established over two years ago, a number of projects are moving forward. The National Visitors' Center, Constitution Gardens, the Eisenhower Civic Center, the Fort Circle Parks, the National Air and Space Museum and other projects will contribute enormously to the celebration which takes place here in 1976. In addition, the Pennsylvania Avenue Development Corporation will soon present its plan to restore and improve this central, historically important thoroughfare. During the coming year, I also urge the Congress to take action on pending legislation to create a District of Columbia Development Bank, which would do much to broaden the economic base of the District. THE BICENTENNIAL As we near the celebration of America's Bicentennial, which officially begins in March of 1975, the tempo of preparations has picked up. A sound organizational framework has now been established, with the approval by the Congress last year of a new American Revolution Bicentennial Administration. Each of the 50 States, the District of Columbia and the four territories has also established its own Bicentennial Commission to plan and coordinate local Bicentennial projects. Some 370 counties, cities, towns, villages and tribal units have been recognized as Bicentennial Communities, and some 600 applications for this designation are currently being reviewed. On the Federal level, I have created the Domestic Council Committee on the Bicentennial. This Cabinet-level Committee has approved the goals for Federal participation in the Bicentennial, established an Interagency Bicentennial Task Force, and approved over 200 Bicentennial projects of the Departments and agencies. The Department of the Interior will complete the development of historically significant National Park sites; the National Foundation on the Arts and the Humanities will support cultural activities relating to the Bicentennial; and many of our other national institutions, such as the Smithsonian Institution, will present special exhibitions across the Nation. Other nations are actively responding to the "Invitation to the World" that I issued on July 4, 1972 to participate with us in this celebration which is not ours alone, but one which draws on the heritage of every nation from which people have come to our shores. In celebrating America's Bicentennial, we shall, of course, commemorate our national achievements. We shall honor our celebrated leaders even as we remember those whose contributions were less well known. We shall take stock of our shortcomings and resolve to overcome them. What we will celebrate most of all in 1976 will be the vitality of the American people. We have tried to ensure that Federal Bicentennial activities reflect the diversity which is ours alone, and which is appearing in community Bicentennial planning across the country. CULTURE AND COMMUNICATIONS When I took office in 1969, I was determined to give support to the goal of substantially strengthening the arts and humanities in the United States. The result has been the rapid growth of the National Endowment for the Arts and the National Endowment for the Humanities-which had existed before but at a very low level of activity. In the current year, the National Endowment for the Arts will spend $60.8 million on a large scale of programs intended to enrich America's cultural present and future. A broad range of individuals as well as institutions, both public and private, are being assisted. And special support is being given to projects which will add to the celebration of our Bicentennial. The Congress has in the past given strong bipartisan support to the Arts Endowment. That same support will be needed in the future. Increased Federal funds, eliciting greater financial support from the private sector and State and local governments, will ensure the flourishing of American arts in the years ahead. The National Endowment for the Humanities has likewise made outstanding contributions to the stimulation of our intellectual and cultural life. One measure of the growing importance of its activities is the fact that the Humanities Endowment has a program today which is ten times as large as it was five years ago. The Humanities Endowment will also play a major role in promoting the Bicentennial and will emphasize activities which reach large numbers of people, such as film and television productions and traveling exhibitions. In America, television is by far the best means of communicating with the widest audience. To assure the American audience a greater range of television programming of a type not financially feasible for commercial television, we have dramatically increased our support for public television in the last five years. Public Broadcasting matured during the past year. Both the television and radio licensees reorganized themselves in a way which encouraged a more rational relationship between them and the Corporation for Public Broadcasting, and increased the ability of each local station to provide programs uniquely tailored to their local communities. Another aspect of electronic media that has recently become a public policy issue is cable television, a development that could lead to a vast expansion of the Nation's communications capabilities. In June of 1971, I established a Cabinet Committee to develop proposals for a comprehensive national policy on cable communications. I have recently received and am now reviewing the report which is the product of that committee. I have also asked the Director of Telecommunications Policy to prepare legislation to move toward the adoption and implementation of a national cable television policy and I expect to submit such legislation to the Congress in the near future. I encourage the Congress to review carefully the issues presented by cable television and I especially encourage a widespread national debate on this subject which could play such a major role in all of our lives during the future. SCIENCE AND TECHNOLOGY One of the great strengths of this Nation has been its preeminence in science and technology. In times of national peril we have turned to the men and women in the laboratories in universities, Government, and private industry to apply their knowledge to new challenges. Once again, in the current energy crisis, we are calling upon them to respond. I have outlined, in my recent energy message to the Congress, the first step in a five-year, $10 billion research and development effort in energy: $1.8 billion for direct energy R&D for the coming fiscal year and an additional $216 million for supporting research--a total increase of 80 percent over this year. A look at the broad scope of this energy effort tells a great deal about our confidence in the capabilities of the Nation's scientists and engineers. We are calling on them to accelerate the development of nuclear power systems, to determine how we can use our abundant supplies of coal in ways that are environmentally acceptable and to improve technology for harnessing natural energy sources such as the sun and the heat of the earth. At the same time, we are asking them to explore new ways of conserving the energy that we already use for everyday conveniences such as our automobiles. This Administration recognizes that the need for progress in every major area of American life requires technological input. We are therefore committed to giving all our major programs a broad scientific underpinning. The new budget will call for an increase of over 20 percent in civilian research and development expenditures. In addition to a major increase for energy, research and development funds will be spread across a large number of programs for enhancing the prosperity, well-being, and health of Americans. Science will continue to be vital to our efforts to fight drug abuse, to prevent infant mortality, to combat venereal disease, and to aid in treating mental illness. We will call upon the services of our scientists and engineers to design better forms of transportation, and to make safer the transportation we already have. We will examine ways of making our vast agricultural establishment yield more food at lower prices, and try to lessen agriculturally-related pollution. We will attempt to develop methods of mining that will not only yield greater mineral wealth but also give the miner greater safety and the landscape greater protection. We will study ways to protect our wildlife from natural and man-made attack, and we will attempt to learn how to protect ourselves from the violence of nature in the form of floods, landslides, earthquakes, tornadoes, and other natural calamities. This Administration recognizes the vital role which the social sciences must play in America's growth. Money will be made available for studying the social effects of various Government income distribution and redistribution plans, such as social security, welfare benefits, health insurance, and varied and experimental educational forms. In every great area of national endeavor, the Administration will see that adequate funds for making scientific progress are spent. That also means we will continue our important efforts in space. The exploration of space is today making a key contribution to man's understanding of his universe and to our abilities to manage our resources on earth wisely. As our Skylab astronauts have proven, space is now an acceptable working environment for man. While we explore our planetary system, the stars, and the galaxies, we are also using space technology to monitor the earth's environment. The Earth Resources Technology Satellite is allowing us to search for scarce resources from high above the earth. Already, many of our intercontinental communications are by satellite. This year new commercial satellites will also be used for domestic telephone, telegraph, and television services. Satellite weather forecasting is now commonplace as a result of our space efforts. Space exploration in the future should become more economical as we develop the Space Shuttle, a reusable vehicle for space transportation. A cooperative international aspect of the space program will come with the European developed Space-lab as an integral part of the Shuttle program. In addition, we are now moving full speed ahead with our plans for a joint space venture with the Soviets in 1975. THE NEW FEDERALISM Just as the rapidly changing and increasing demands placed upon Government have made it necessary to reorganize the Federal structure, they have made it even more imperative to make State and local government stronger and more effective. During the last four decades, almost every major attempt by the Government to meet a major social need has resulted in a new national program administered in Washington by a new bureaucracy. Forty years ago there were more than 600,000 Federal employees; today there are more than 2.7 million. In the last decade, this problem has grown acute. In 1960 there were some 200 Federal grant-in-aid programs with outlays of $8 billion, but by 1970 there were nearly 1,000 and the total outlays had risen to $22 billion. And in the next fiscal year we expect outlays for grant-in-aid programs to reach $52 billion, even after our substantial efforts to cut their number. This growth in size, power and complexity has made the Federal Government increasingly inaccessible to the individual citizen it seeks to help. Many of our new national social programs have actually impeded the development of effective local government. By creating a Federal categorical grant system of staggering complexity and diversity we have fostered at the State and local level: 
--Overlapping and wasteful programs; 
--Distorted budgets and priorities; 
--Additional administrative expense; 
--Delay and uncertainty; and 
--A diminution in the authority and responsibilities of State and local elected officials, as Federal grants have become the special province of competing bureaucracies. In one of the basic new directions of my Administration, I proposed in 1969 that we create a new and fundamentally different relationship between State and local government, on the one hand, and the Federal Government on the other. This new relationship has come to be known as the New Federalism. As I said in 1969, its purposes are: 
--To restore to the States proper rights and roles in the Federal system with a new emphasis on local responsiveness; 
--To provide both the encouragement and necessary resources for local and State officials to exercise leadership in solving their own problems; 
--To narrow the distance between people and the Government agencies dealing with their problems; 
--To restore strength and vigor to State and local governments where elected officials know best the needs and priorities of their own constituents; and 
--To shift the balance of political power away from Washington and back to the country and the people. With the help of both the Congress and the Administration, this new relationship among local, State and Federal governments has begun to take shape: 
--In 1972, the Congress enacted our General Revenue Sharing program, and already more than $11 billion of new money has been put to work in over 38,000 units of State and local government. --Funding through the Law Enforcement Assistance program has demonstrated the flexibility of the New Federalism in leaving to State and local authorities the decisions on how best to combat crime in their jurisdictions. This program has helped to make America's streets safer for our citizens. --The Comprehensive Employment and Training Act which I signed into law in 1973 is a landmark example of the New Federalism's broad and more flexible forms of assistance--and it represents a leading example of what can be achieved when the Executive and the Congress team up to enact solid legislation. --New authorities under the Rural Development Act are being exercised this year in a way which is supportive of State and local development plans and priorities. --In addition, within the limits of law, we have moved administratively to strengthen the role of State and local governments by simplifying and streamlining Federal grant systems--including procedures for State and local review of project proposals affecting their jurisdictions, opportunities for grant integration and joint funding, and the decentralization of many Federal activities to ten Federal Regional Councils. In the remaining three years of this term I shall continue to take every sound administrative action within the authorities available to me to support and strengthen State and local government, but we must have the support of the Congress to maintain the progress which has begun. Proposals for furthering the New Federalism now before this body and for which I urge your support include: --Federal education reforms to consolidate support for elementary and secondary schools as well as vocational and adult programs, and to promote better planning on the local level through advance funding. --The Better Communities Act, to replace several ineffective and restrictive urban programs with a flexible approach that would allow local officials to make essential decisions on the way community development funds would be spent. --The Responsive Governments Act, to provide needed Federal assistance for improving State and local planning, decision-making and management capabilities. This would help to strengthen the capacity of State and local governments to assume greater responsibility for the administration of their own programs, whether federally assisted or not. --The Disaster Preparedness Act, to increase the role of State and local officials in allocating Federal disaster funds and to cut the tangle of Federal red tape. In addition to these proposals now pending, a number of the new initiatives that I describe elsewhere in this message also reflect the principles of New Federalism. These include: --A new public transportation initiative that would permit States and localities-both urban and rural--to allocate highway and mass transit funds in accordance with local conditions and priorities. --An economic adjustment assistance program, that would help States and communities to create employment opportunities where they have been affected by structural changes in their economies which has brought about persistent unemployment or depressed incomes. --In the field of health, a comprehensive health insurance plan which would bring protection against medical expenses within the reach of all our citizens. MAKING GOVERNMENT WORK BETTER On taking office five years ago, one of the first needs I sought to address was the organization of the executive branch of Government--for the plain fact is that the only way Government gets anything done is through its organizational structure, and how well it can perform depends in large measure on how well it is organized. Because the needs of the Nation continue to change, and because the activities of Government must respond to those changes, the patterns of Government organization that might have been fine in the 1930s or even in the 1960s, may be hopelessly out of date in the 1970s. Therefore, early in my first term I established an expert commission to survey the organization of the executive branch and to recommend improvements to meet present-day needs. The reports of this commission contributed significantly to the reorganizations that I ordered and that I recommended, including the proposal I put forward three years ago for a sweeping reorganization of the executive branch, consolidating seven of the present Cabinet departments into four new units. Although this basic restructuring has not been enacted by the Congress, other progress of a substantial nature has been made in modernizing the Government. For example, we have established: --The United States Postal Service, taking the post office out of politics; --The Office of Management and Budget, providing a strong management arm to assist in coordinating the functions of the executive branch; --A restructured National Security Council; 
--The Domestic Council to coordinate domestic policy formulation; --The Council on Environmental Quality, the Environmental Protection Agency, and the National Oceanic and Atmospheric Administration, all to provide leadership in meeting our vital environmental needs; --The Special Action Office for Drug Abuse Prevention and the Drug Enforcement Administration; --The Council on Economic Policy, to facilitate the formation and execution of overall economic policy; --The Council on International Economic Policy, to focus on an area increasingly important both to our foreign relations and to our domestic economy; --ACTION, to provide stronger coordination and incentives for volunteer activities; --The Cost of Living Council, to help stabilize prices; and, --The Federal Disaster Assistance Administration, to help individuals and communities struck by natural disasters. Each of these reorganization steps was designed to meet a specific need more effectively, or to respond to newly urgent needs. Several were accomplished under the reorganization plan authority which has been available to every President in the last 25 years, but which expired last March. This authority--which is utilized only with the concurrence of the Congress-continues to be necessary in order to keep abreast of changing needs, and I urge that it be reinstituted. Of special concern today is the reorganization of the Government to meet the energy crisis. I have by Executive Order already established the Federal Energy Office to serve as a focal point for energy actions taken by the Government. But that office lacks a statutory base and does not have sufficient authority to do the full job. That is why I have asked the Congress to establish the Federal Energy Administration and I once again urge it to act on this matter. Recognizing that this country should no longer remain dependent upon foreign energy sources, I have also urged the creation of an Energy Research and Development Administration to develop the necessary technology to tap new domestic sources of energy and a separate Nuclear Energy Commission to carry on the regulatory activities presently assigned to the Atomic Energy Commission. While these organizational initiatives are needed now, the best organization to knit together the future energy and natural resource programs of the Federal Government would be a comprehensive Department of Energy and Natural Resources. This concept is consistent with the major Federal departmental reform I submitted to the Congress in 1871. Today, I again urge swift, favorable action by the Congress on this proposal so that we will have the broad organizational base that will ultimately be needed to meet many of our energy needs in the most effective manner and to balance energy and natural resource considerations in the future. That same consolidation and reorganization of the executive branch that I proposed in 1971 would also have created new departments for community development, human resources and economic affairs. The basic problems of fractionated, sometimes overlapping and often conflicting organizations that prompted these original proposals remain acute today. I therefore urge the Congress to join with me in a serious effort to achieve an effective reorganization in these areas. In view of the close relationship between food assistance programs and other income security programs, I will also propose new legislation to transfer the food stamp and related programs from the Department of Agriculture to the Department of Health, Education and Welfare. Another important organizational proposal still awaiting Congressional action is the creation of an independent Legal Service Corporation. My Administration will work closely with the Congress in the weeks ahead to obtain final passage of our proposal which would provide the poor with quality legal representation, would create an organization free from political pressures, and would include safeguards to ensure its responsible operation. Legal services legislation has already passed the House. I am hopeful that reasonable legal services legislation will now be passed by the Senate. A major new opportunity for better Federal management has been initiated at my direction by the Office of Management and Budget. Frequently termed "management by objective," it involves the identification of specific, high-priority objectives for each year for each of the departments and agencies. During the year, progress in reaching these objectives can be closely measured and reported to agency heads and to me. In the years ahead I expect this technique will help make the Government both more responsive and more accountable. Nothing is more important to improving the efficiency of our Government than the recruiting of top flight personnel for Federal jobs--including positions in the career civil service. We will be working in the months ahead to ensure that executive compensation, career development and training all attract and hold the best possible personnel in the public service. The compensation we provide our top officials is integral to these efforts to recruit and retain the best men and women for Government service. Salaries of Federal judges, Members of the Congress, and heads and assistant heads of executive agencies have not been adjusted for 5 years, during which time comparable pay rates in the private sector increased 30 percent and pay for other Federal employees has increased significantly. The report of the Commission on Executive, Legislative and Judicial Salaries notes that this lag in compensation also produces serious salary compression among the top ranks of career employees. I am therefore recommending a three-stage increase in executive, legislative and judicial salaries in the budget, at the rate of 7 1/2 percent annually for each of the next three years. This will make salaries within the top levels of the Federal Government more competitive with industry. And it will help us to make Government work better. CAMPAIGN REFORM For several years it has been clear that reforms were needed in the way we elect public officials. The intense public focus placed on the campaign abuses of 1972 has now generated sufficient support for this issue that we now have an opportunity to make a genuine breakthrough. In a national radio address on May 16 of last year, I announced my proposal for a non-partisan commission on campaign reform. This commission would have reexamined the entire Federal election process to come up with a comprehensive set of legislative recommendations. The Commission would have filed a public report no later than December 1, 1973. Eight months have now passed since that proposal was submitted to the Congress and the Commission is not even close to being created. If it had been created expeditiously, we would now have its report recommending meaningful reforms for Federal campaigns and as I had originally hoped, those reforms might be in place prior to the 1974 elections. In light of the delay, I have now decided to submit a comprehensive set of Administration proposals on campaign reform for consideration by the Congress during this session. While I do not believe mine will be the only workable proposals, I do hope they will lead to meaningful debate and reform in this critical area. To that end, I look forward to working with the Congress in a long-overdue effort to clean up the Federal election process. AMERICA AND THE WORLD When this Administration took office, it was apparent that the world had changed in fundamental ways, and that America's foreign policy had to change in equally fundamental ways. We needed to end our military involvement in the Vietnam war in a manner consistent with our responsibilities and commitments as a major world power. We needed to adjust to the changes in the strategic situation between the Soviet Union and the United States which presented a unique opportunity to build a solid foundation for peace but which also threatened our own security if that foundation could not be built. We needed to end a quarter century of hostile isolation which had kept one-fourth of the world's population outside the framework of international cooperation. The world could not afford another generation of hostility between the United States and the People's Republic of China. We needed to adjust our partnerships with Western Europe and Japan, recognizing their increasing political and economic strength and self-reliance, and emphasizing our important common goals. We needed to alter the world monetary system to reflect the new realities of the international economic system and America's place in it. During the past five years we have made striking progress in meeting each of these needs. CONTINUING RESPONSIBILITY IN 
VIETNAM The United States is at peace for the first time in more than a decade. But peace must be something more than the absence of the active engagement of American forces in conflict. We must guard against the tendency to express relief at our military extrication from Southeast Asia by "washing our hands" of the whole affair. Men and women are still dying there. We still have a responsibility there. We must provide those ravaged lands with the economic assistance needed to stabilize the structures of their societies and make future peace more likely. We must provide, as well, the continued military aid grants required to maintain strong, self-reliant defense forces. And we will continue to insist on full compliance with the terms of the agreements reached in Paris, including a full accounting of all of our men missing in Southeast Asia. BUILDING NEW RELATIONSHIPS As we work through detente to reduce conflict in areas of the world where both we and the Soviet Union have important interests, we must also continue to work to reduce the potential causes of conflict between us. We must persevere in our negotiations with the Soviet Union to place further limits on strategic arms competition and in our talks with the Warsaw Pact nations to reduce forces in Europe in a way that will increase security and stability for all. We will pursue our relations with the Soviet Union in the climate of detente established two years ago in Moscow and reaffirmed by General Secretary Brezhnev's visit to Washington last year. During the fateful weeks of the Middle East war last October, the strength of our detente was severely tested. Since then, American diplomatic leadership and initiative have played a central role in the search for a final settlement in the long troubled Middle East. This began with the cease-fire of October 22, worked out with the Soviet Union's assistance, and was later strengthened by the Six-Point Agreement in November to consolidate the cease-fire, then by the Geneva Peace Conference--under the co-sponsorship of the United States and the Soviet Union-and most recently by the agreement on the disengagement of Egyptian and Israeli military forces, which is being implemented in cooperation with the United Nations Emergency Force. These steps are but the beginning of broadened efforts to find a lasting settlement of the area's problems. The process of building a normal relationship with the People's Republic of China continues. Liaison offices have been established in our respective capitals and there continues to be fruitful contact between our governments at very high levels. STRENGTHENING OUR FREE WORLD 
PARTNERSHIPS As our relationships with old adversaries are changing, so are our relationships with old friends. Western Europe and Japan have put behind them the postwar struggle to rebuild their economies, re-order their societies and re-establish their political force. Their success in these endeavors is something we helped to foster and in which we can take pride. But now times have changed and our past role in their success cannot be the sole basis for a continuing relationship. We must instead adjust our relationships to recognize their new economic capacities and their international political objectives. We must accommodate all of these within the framework of the friendship and goodwill of our allies and our whole past history of cooperation in the pursuit of our common goals. This is a cornerstone of the structure of peace we are seeking to build. With our closest neighbors, here in the Western Hemisphere, we shall continue to seek additional ways of working cooperatively to solve the problems which face the Americas. Secretary of State Kissinger will be meeting in a few weeks with the foreign ministers of Latin America to begin a new and constructive dialogue in the family of American states. INTERNATIONAL TRADE AND COMMERCE As we turn from an era of confrontation to one of cooperation, trade and commerce become more important. We have moved from a position of virtual economic hegemony in the world to a new role in a more interdependent world economy. We must create an equitable and efficient system of integrating our own economy with that of the rest of the world. Much has already been accomplished on this front. The markets of the USSR and China are now accessible, thereby providing jobs for American workers. Our major trading partners in Western Europe and Japan share our interest in further reducing international trade barriers and increasing world trade. The rigid and outmoded international monetary system which over-valued the dollar and impeded our foreign trade has been decisively altered. After two years of trade deficits, America achieved a trade surplus in 1973. But we must persevere in our international monetary, investment and trade negotiations. The greatest tasks still lie ahead and the stakes are high. Avoiding the economic and political disruptions associated with international monetary turmoil and restrictive trade and investment practices increases in importance as international interdependence grows. As I noted earlier in this message, prompt passage of the pending Trade Reform Act is essential to achieving the goal of a less restrictive and more equitable international economic system. In addition, we must move forward with the current negotiations to reform the international payments system under the auspices of the International Monetary Fund, reforms which will markedly increase the opportunities for nations to trade and invest profitably. We must also strengthen our resolve as the world's most prosperous nation to help less fortunate countries. In the world of today, no nation will be fully secure or prosperous until all nations are. As in the past, we will take pride in our efforts to work with developing nations which aspire to greater economic and social well-being. The United States has called for the World Food Conference which will be held in November under the auspices of the United Nations. We will also actively observe 1974 as World Population Year, as proclaimed by the United Nations. MAINTAINING A STRONG DEFENSE FORGE But as we work for .peace, we must be conscious that the opportunity to build a structure of peace came because our arms have served as a deterrent to war. We must maintain that deterrent. In the last five years, outlays for the Department of Defense have been reduced by about 1/3--measured in constant dollars--and military personnel have been cut from 3.5 million to 2.2 million. This year, I will recommend a substantial increase in the 1975 budget for the Department of Defense. These increases are necessary to improve the readiness of our armed forces, to build up levels of essential equipment and supplies and to preserve Present force levels in the face of rising costs. CONCLUSION Throughout these five years, I have had one overriding aim: to establish a structure of peace in the world that can free future generations from the scourge of war. Others may have different priorities; this has been and will remain my first priority, the chief legacy that I hope to leave from the eight years of my Presidency. As we strengthen the peace, we must also continue each year a steady strengthening of our society here at home. Our conscience requires it. Our interests require it. We must insist on it. As we create more jobs, as we build a better health care system, and improve education; as we develop new sources of energy, as we provide more abundantly for the elderly and the poor, as we strengthen the system of private enterprise that produces our prosperity--as we do all this and more, we solidify those essential bonds that hold us together as a Nation. Even more importantly, we advance what in the final analysis government in America is all about; more freedom, more security, a better life, for each one of the 211 million individual persons who are America. We cannot afford to neglect progress at home while pursuing peace abroad. But neither can we afford to neglect peace abroad while pursuing progress at home. With a stable peace, all is possible; without peace, nothing is possible. Earlier in this message, I comment that "one of the continuing challenges facing us in the legislative process is that of the timing and pacing of our initiatives . . . selecting each year among many worthy projects those that are ripe for action at that time . . ." What is true in terms of our domestic initiatives is true also in the world. This period we now are in--these few years-presents a juncture of historic forces unique in this century, which provide an opportunity we may never have again to create a structure of peace solid enough to last a lifetime and more--not just peace in our time but peace in our children's time as well. It is on the way we respond to this opportunity, more than anything else, that history will judge whether we in America have met our responsibility. I have full confidence that we will meet that responsibility. RICHARD NIXON 
The White House, 
January 30, 1974.
We enter 1974 not at the beginning of an historical cycle, but in the middle of one. Beginnings have been made in many vital areas, beginnings which we now must build upon. New needs have arisen which we are in the process of addressing. Opportunities are coalescing which give us a chance to make historic progress toward a stable peace and expanding prosperity. In looking at the agenda for 1974, we cannot consider the work of this or of any one year in isolation. What we select as our tasks in 1974 must build on the work of the years before, and anticipate needs of those ahead. Indeed, one of the continuing challenges facing us in the legislative process is that of the timing and pacing of our initiatives. It would be as false to pretend that we could do--or afford to do everything at once, as it would be to maintain that we can do nothing. Therefore, we must strive to maintain steady progress, selecting each year among many worthy projects those that are ripe for action at that time, and that can be accommodated within the constraints of our budget--but pressing to ensure that the most that can be done is clone. In discussing my legislative recommendations for this Congressional session, therefore, I shall do so in the context of the advances that have already been made, the problems that remain, and the special opportunities we have in 1974 to make further progress. I have started with certain basic premises: --The basic tax burden on the American taxpayer should not be increased. --Our new initiatives, therefore, should be scaled to what can prudently be spent given the level of revenues that would be generated by the existing tax structure at full utilization of our resources. --Increases in Federal spending should be kept to a minimum, but the budget should be flexible enough to be used, if necessary, to maintain jobs and prosperity. --It is essential that we break the old habit of regarding any Federal program, once established, as permanent; we must learn to scrap old programs that are no longer effective or needed in favor of new ones that are. This is the only way we can afford to do what must be done. Within these guidelines, there are a number of major new initiatives which are ripe for action in 1974--several of which can be milestones on our march to a life of greater freedom, greater opportunity and greater prosperity for all. In particular, 1974 can be the year in which: --First, we not only break the back of the energy crisis, but also, through Project Independence, lay the foundation for our future capacity to meet America's energy needs from America's own resources--at reasonable prices and with adequate environmental protection. --Second, we take another giant stride toward lasting peace in the world--not only by continuing our policy of negotiation rather than confrontation where the great powers are concerned, but also by helping toward the achievement of a just and lasting settlement in the Middle East. --Third, we will check the rise in prices, without administering the harsh medicine of recession, and move the economy into a period of steady growth at a sustainable level. --Fourth, we establish a new system of comprehensive health insurance that makes high quality health care available to every American in a dignified manner and at a price he or she can afford. --Fifth, we continue to build a new era of achievement and responsiveness in State and local government, by cutting the strings of too tight Federal control that have bound the hands of State and local officials in community and economic development programs. --Sixth, we make a crucial breakthrough toward better transportation by strengthening the ability of local communities to deal with their transportation problems. --Seventh, we reform our system of Federal aid to education to provide it when it is needed, where it is needed, and so that it will do the most for those who need it most. --Eighth, we make an historic beginning on the task of defining and protecting the right of personal privacy. --Ninth, we start on a new road toward reform of a welfare system that bleeds the taxpayer, corrodes the community and demeans those it is meant to assist. --And tenth, together with the other nations of the world, we establish the economic framework within which Americans will share more fully in an expanding world trade and prosperity in the years ahead, with more open access to both markets and supplies. MEETING OUR ENERGY NEEDS At the start of this Congressional session, the number one legislative concern must be the energy crisis. The cooperative efforts of the American people, together with measures already taken by the Administration, have significantly reduced the immediate impact of the energy crisis. There has been some economic dislocation and some individual hardships, but these have been minimized by our policy of encouraging broad conservation measures and allocating scarce energy resources so as to do the least possible harm to jobs and the economy. The object has been to keep our farms and factories producing, to keep our workers on the job, and to keep our goods and services flowing, even if this means that we must live and work in somewhat less comfortable surroundings and drive fewer miles at slower speeds. Even with the full cooperation of most Americans, however, we will still face real challenges--and genuine shortages--in the months and years immediately ahead. To meet these challenges, we must change our patterns of energy consumption and production, we must press forward with the development of reliable new energy sources, and we must adjust to the fact that the age of unlimited supplies of cheap energy is ended. The immediate energy crisis began with the oil embargo imposed in the Middle East last fall. But the embargo only hastened a shortage that was already anticipated. For a number of years our fuel consumption had been climbing while our production of domestic energy supplies declined. We became more and more heavily dependent on oil imports and, consequently, more vulnerable to any interruption or reduction in those imports, as well as to sudden increases in foreign prices. Today, we have an interruption in supplies and we face sharply increased prices for those supplies when they are restored. Irrespective of the possibility of restoring the flow of Middle East oil, we must act now to ensure that we are never again dependent on foreign sources of supply for our energy needs. We must continue to slow the rise in our rate of consumption, and we must sharply increase our domestic production. The effects of energy conservation can be felt at once. Already the responsiveness of the American people to the recent crisis has proved to be the major factor in helping to avoid the serious consequences that the winter might have brought. That conservation must continue. The required increase in domestic supplies cannot be achieved so rapidly. It will involve the development of entirely new sources of energy as well as the expanded development of oil and coal resources; it will require a significant expansion of our research and development efforts; it will require a shift from the use of scarce fuels to those which are more plentiful but also more expensive than the cheap energy to which we have been accustomed; it will require that we encourage both exploration and production; it will mean that as we act to prevent the energy industry from making unconscionable windfall profits, we must also avoid crippling that industry with punitive legislation; and finally, it will require that we make some difficult decisions as we sort out our economic and environmental priorities. As we seek to act domestically to increase fuel supplies, we will act internationally in an effort to obtain oil at reasonable prices. Unreasonable increases in the cost of so vital a commodity as oil poses a threat to the entire structure of international economic relations. Not only YOU.S. jobs, prices and incomes are at stake, but the general pattern of international cooperation is at stake as well. It is our hope that we can work out cooperative efforts with our friends abroad so that we eau all meet our energy needs without disrupting our economies and without disrupting our economic relationships. Last week I sent to the Congress a comprehensive special message setting forth our energy situation, our energy prospects, our energy needs, and the legislative measures I consider necessary for meeting those needs. I shall not repeat that analysis nor the full list of those recommendations today. I do want to urge, however, that the critical energy measures which I have proposed be made the first order of legislative business in this session of the Congress, and that work go forward expeditiously on the others. Those measures which I request be given the highest priority are the following: --A special energy act which would permit additional restrictions on energy consumption and would postpone temporarily certain Clean Air Act requirements for power plants and automotive emissions; --A windfall profits tax which would prevent private profiteering at the expense of public sacrifice; --Unemployment insurance for people in areas impacted by serious economic dislocation; and --Mandatory reporting by major energy companies on their inventories, their production and their reserves. I am also asking that the Congress quickly establish the Federal Energy Administration and the Energy Research and Development Administration to provide the appropriate organizational structure for administering the national energy policy, as we work toward the establishment of a Department of Energy and Natural Resources. The 13 other energy measures I requested last week deal with longer-term needs, extending beyond the present emergency. But these also require expeditious action if we are to achieve the goal of Project Independence--a capacity for energy self-sufficiency by 1980. The success of Project Independence is essential to the continued strength of our position in world trade, and also to our independence of action as a great power. I hope that our joint efforts now to resolve the energy crisis and to move toward a capacity for self-sufficiency in energy will enable the President who addresses the 98th Congress a decade from now to look back and say we made it possible for America to enjoy continued peace and prosperity in the 1980s. THE NATION'S ECONOMY THE WORLD ECONOMY During the past three years the United States has reached an unprecedented level of material prosperity. Industrial output has set new records. Trade has flourished. Consumption has risen to the highest levels in history. Even our inflation rate-the most serious economic problem we now face--has been one of the lowest in the industrialized free world. The major policy decisions we took in 1971 contributed significantly to this prosperity--both here and in other countries. It was clear, for example, as we moved into the 1970s that the international monetary system adopted after World War II needed major adjustments. Unsustainable imbalances had developed, threatening a resurgence of protectionism and a disruption of world trade. This is why I decided to take some very strong measures in August of 1971, measures that have resulted in a major realignment of world currency values, progress toward new and more flexible international monetary management, and negotiations toward a more open and equitable trading system. These adjustments, while essential, were not easy. But now we have finally entered into a more flexible and realistic international financial system. Much remains to be done to complete the transition, but its beneficial results are already clear. The realignment of currency values helped produce an increase of 80 percent--or more than $50 billion in the rate of YOU.S. exports during the past two years, along with a major improvement in our trade balance. This improvement was good not only for us, but also for the rest of the world. In addition, the shocks to the world economy arising from reduced food supplies in 1972 and 1973, and in recent months from the oil embargo and the arbitrary increases in the price of oil, all were managed without panic under the new arrangements. Indeed, world trade has continued to expand, despite these temporary difficulties. INTERNATIONAL TRADE BARRIERS A vigorous international trade is vital to the American economy. Jobs for American workers depend on our ability to develop foreign markets. Moreover, American consumers deserve access to foreign-made products that might be less expensive, or more interesting, or unavailable in the United States. But if trade is to be advantageous over the long run, it must be conducted on a basis which is fair to all participants. There are still many unnecessary barriers to trade which need to be lowered or removed. While improvements have been made in this situation during the last 10 years, we need now to build on this progress and to negotiate for more open access both to markets and supplies. This is why I call upon the Congress with special urgency to complete action on my proposed Trade Reform Act, in order to provide the authority we will need to negotiate effectively for reductions in barriers to trade, to improve the trading system, and to manage trade problems at home more effectively. As the Senate considers this legislation, I would draw its attention particularly to provisions added in the House which would seriously impede our efforts to achieve more harmonious international relationships. These provisions would effectively prevent both the extension of nondiscriminatory tariff treatment and of credits to certain Communist countries unless they followed a policy which allowed unrestricted emigration. I am convinced that such a prohibition would only make more difficult the kind of cooperative effort between the United States and other governments which is necessary if we are to work together for peace in the Middle East and throughout the world. I am confident that by working with the Congress we can find a solution to this problem that will avoid a major setback in our peacemaking efforts. At the same time, we must move forward with current negotiations to reform the international payments system under the auspices of the International Monetary Fund. These negotiations are designed to increase the opportunities for all nations to trade and invest profitably. The YOU.S. has already presented proposals for deterring the growth of significant imbalances in international monetary affairs while preserving for each nation a wide freedom in choosing how necessary adjustments can best be accomplished. In addition, the system will also have to accommodate the increased payments flow and prospective reserve accumulations occasioned by higher oil prices. If, however, other nations share with us the will to preserve a healthy and growing world economy, I am confident that a mutually acceptable solution to this problem will be achieved. In practice, this means that our markets must increasingly be open to imports from developing countries--a condition that would be significantly facilitated by enactment of the Trade Reform Act. It also means that the Congress must continue to authorize and appropriate our fair share of both bilateral and multilateral economic assistance, including a substantial contribution to the International Development Association which helps the poorest countries. In 1973 we successfully negotiated a reduction of the United States share from 40 percent to one-third of IDA funds. We cannot let the action of the House in voting against IDA stand as our final answer. We will work hard with the Congress to ensure that this country continues to play a leadership role, consistent with our own economic situation, so that long-term economic development can continue to be planned in an orderly manner. Along with trade and monetary problems, new international agreements on investment policies and new mechanisms for dispute settlement are high on our negotiating agenda for the coming year. We must continue to work for economic arrangements which permit the beneficial flow of international investment so that all may derive the maximum benefit from their own resources. To that end, I am glad to be able to note that this week the United States completed the phaseout of controls on flows of capital from this country. The recent oil embargo and especially arbitrary increases in the price of oil have created major economic problems for many countries, including the United States. If continued, these policies would require enormous transfers of goods and assets from oil importing nations, transfers which would represent a serious burden for even the wealthiest countries and which would be virtually unbearable for the less developed countries. Our objectives are clear--we must get world oil prices down from levels that are arbitrary and exploitative. We must also cooperate to ensure that the international and domestic economic policies of the advanced countries do not compound the economic disturbances created by the current emergency but rather that we do all that can be done to contain and limit those disturbances. THE DOMESTIC ECONOMY Despite our general prosperity, inflation remains a most serious economic problem, not only in the United States but also for the rest of the world. We see clear evidence of this problem at every hand. World oil prices have gone up recently at dramatic rates. World food, metals and other commodities prices are also up sharply. Because domestic prices cannot be isolated from international prices, worldwide inflationary pressures have helped to drive up prices here at home. Inflation has been a continuous problem for nearly a decade, and it got worse in 1973. The result has been that people have come to expect continuing price increases--and to behave accordingly in their own economic life. Their behavior, in turn, adds further to inflationary pressures, contributing to a vicious inflationary spiral which is difficult to break. Some people have said that the best way to wring these inflationary expectations out of our economy is by taking the economy into a recession. I disagree. It is true that a lower level of economic activity would reduce demand and thus lower the pressure for higher prices. However, the cost of such a policy in terms of increased unemployment would simply be unacceptable. By the same token, I also reject the notion that we should totally ignore inflation and concentrate solely on stimulating higher levels of employment. This policy would also involve too high a cost since it would unleash a further acceleration of the inflation rate. In developing my economic policy for 1974, I have chosen what I believe is a sound middle road: to cushion the economic slowdown we expect during 1974 without providing additional stimulus for inflation. We expect this policy to reduce the rate of inflation by the end of the year. Should there appear to be a serious threat of a severe slowdown, then we will act promptly and vigorously to support the economy. As we cope with the challenge of inflation, we must recognize the clear lesson of recent years: While direct controls over prices and wages can help fight inflation in the short-run, they have a very limited useful life. Inevitably, their eventual effect is to create or aggravate significant distortions in production and distribution. Accordingly, I will continue to watch the wage-price situation closely and to pursue a policy of gradual, selective decontrol except in particularly troublesome areas. At the same time, those Federal programs that will help reduce inflation by increasing the supply of scarce resources will be strengthened. One key area where we can look forward to expanded supplies is that of food. With a new national farm policy that encourages rather than discourages output, we achieved a record harvest in 1973 and another record harvest now appears likely in 1974. Increased agricultural output is the only sure way to bring food prices down--and increased output is what our new policies are producing. Rapid inflation is not inevitable and it must not be tolerated. To regain control of inflation, however, will require patience and persistence over the long course. My Administration is dedicated to achieving this objective and we are confident that with the help of the American people we will succeed. Another most pressing economic problem-and a major contributor to inflation-is the energy crisis. As the cost of using our own fuel resources came to exceed the cost of imports in the 1960's, it became increasingly attractive for us to import oil and petroleum products. Unfortunately, our growing dependence on imports made our entire economy more vulnerable to outside forces. That vulnerability has been tested in recent months--as has the even greater vulnerability of the developed countries of Western Europe and Japan and the less developed countries which have no oil. Every American has learned the consequences of this vulnerability: short fuel supplies and higher fuel prices. To a large extent, our flexible, adaptable economy will solve the longer run energy problem through the normal workings of the marketplace. As energy prices reach somewhat higher levels than the bargain rates of the past, conservation will be encouraged while domestic energy production will be expanded. One example of normal market forces at work has been the recent shift to smaller cars with better gas mileage. Over the next few years we can also expect to see an expansion of coal production and new output of oil and natural gas. Nevertheless, we will still have to import some of the oil we will need in the immediate future. It is essential, therefore, that we seek a more reasonable price for oil in the world market. It is also imperative that we review our current and prospective supplies of other basic commodities. I have therefore directed that a comprehensive report and policy analysis be made concerning this crucial matter so that governmental actions can properly anticipate and help avoid other damaging shortages. Even with the inflation and energy problems, 1973 was a year of many important economic gains for American people. First, employment in 1973 increased by 2.7 million persons; this 3.3 percent rise in employment was the largest since 1955. New job opportunities greatly benefitted all categories of workers, including women, non-whites, teenagers, and Vietnam veterans. Unemployment reached low levels, especially for skilled workers. Second, the purchasing power of the American people reached new highs last year. Even after allowing for price increases, people are now consuming more goods and services than they did a year ago, or in any other year in the entire history of the United States. Not everyone is purchasing power went up, of course. Inflation took its toll on many families whose income did not rise as fast as that of the average American. It is for this reason that we continue to regard inflation as a very serious enemy. At the same time, however, we should not ignore the substantial economic gains that have been made. PERSPECTIVE ON 1974 We have known for some time that a slowdown in economic growth is inevitable in 1974. It has been clear that our economy has simply been growing at an unsustainable rate. Shortages of skilled workers, full utilization of plant and equipment in key industries, and short supplies of a number of essential raw materials have all provided clear indications that our rate of growth would have to taper off. Unfortunately, the very mild slowdown which we anticipated for 1974 now threatens to be somewhat more pronounced because of the oil embargo, the resulting shortages, and the oil price increase. We expect, therefore, that during the early part of this year output will rise little if at all, unemployment will rise somewhat and inflation will be high. Our objective, however, is to turn this situation around so that later in the year output will be rising more rapidly, while unemployment will stop rising and will then decline, and the rate of inflation will slow. ROLE OF THE FEDERAL BUDGET The budget that I will recommend to the Congress next week will help us achieve our goals for this period. It will support the economy, resisting a major slowdown, but it will not provide a degree of stimulation that could accelerate inflation. If future events suggest that a change in fiscal policy is desirable, I will promptly recommend the appropriate changes. In particular, I will not hesitate to use the stimulus of fiscal policy if it becomes necessary to preserve jobs in the face of an unexpected slackening in economic activity. For fiscal year 1975, my budget recommends total spending of $304.4 billion, an increase of $29.7 billion over the current year. The increase is being held to the minimum level necessary--nearly 90 percent of the increase is unavoidable under existing law. The budgeted increase in relatively controllable outlays is only 4.2 percent. Federal receipts should reach $295 billion during fiscal year 1975, an increase of $25 billion. The projected budget deficit is $9.4 billion. Under conditions of full employment, however, Federal receipts would be substantially higher and there would instead be a moderate budget surplus. The Federal budget remains an essential tool in the fight against inflation. With the energy supply limitations we are experiencing and the price pressures they create, budget discipline is still required. I have noted with satisfaction that most Members of the Congress have also recognized the need for budgetary discipline, and that work is going forward to establish a more systematic budgeting procedure. The Congress devoted considerable effort in 1973 to developing a mechanism for coordinating its individual spending decisions with the budget as a whole. I continue to support this effort, although I have been troubled by some of the extraneous amendments which have been added to some of the measures for achieving this goal. I urge the Congress to enact workable budget reform in this legislative session. TAX REFORM Our entire economy is affected by the incentives for job-creating investments that are embodied in our tax laws. Major steps have been taken to reform our tax laws in the past five years, but much remains to be done. Since 1969--primarily through the Tax Reform Act of 1969 and the Revenue Act of 1971--major changes have been introduced to make the personal income tax system conform more nearly to contemporary standards of fairness. Both the higher level of personal exemptions and the low income allowance have worked to free more than eight million low income families from their entire Federal income tax burden. The difference in the tax liability for single and married taxpayers has also been reduced. As a result of these and other tax changes, individual income taxes will be about $25 billion less in 1974 than they would have been under the old tax laws. The saving in the tax burden for a typical family will be more than $270, or the equivalent of two weekly take-home paychecks for the average worker. I look forward to working with the Congress during the next few months not only to simplify our tax laws themselves, but also to simplify the tax forms that individuals fill out and to distribute the income tax burden more equitably. Last April, the Secretary of the Treasury presented to the Congress a set of Administration proposals for major and fundamental tax reform. Included in these proposals were the establishment of a minimum taxable income so that no one could avoid paying a fair share of the tax burden, the establishment of new rules for taxing income from foreign sources, and also a limitation on artificial accounting losses to eliminate so-called "tax shelters." I urge the Congress to consider the Administration's tax reform proposals early in the year. I have also been concerned about the excessive burdens imposed on our low income elderly families by State and local property taxes. To deal with this problem, I have proposed a refundable tax credit for those low income elderly persons whose property taxes exceed five percent of their income. The proposal would also provide equivalent relief for the low income elderly individual who pays rent. I again urge the Congress to enact this very important proposal. FINANCIAL REFORM The health of our economy depends upon an efficient and flexible private financial system--commercial banks, thrift institutions, credit unions, and a host of other institutions and individuals that comprise the financial sector of our economy. The average family depends on these institutions, both to provide a fair and reliable return on its savings and to provide credit on reasonable terms when needed to buy homes, automobiles and other purchases. There have been occasions recently when this financial system has not worked as well as it should--occasions, for example, when mortgage lending has been very difficult to obtain. In large part these problems have been the result of legislation, regulations and institutional arrangements which were suited to an earlier time but which are now obsolete. To remedy this problem I submitted draft legislation last year which reflected the results of careful study by a Presidential commission and Government experts. I again urge the Congress to act promptly on this matter so that American families, businessmen, and local governments can be served by a financial system suited to the economic conditions of the 1970s. The Administration is also studying the competitive position of foreign banks within this country and of American banks abroad to make sure that discriminatory regulations do not prevent American banks and other financial institutions from doing business they are entitled to do. I will be following the results of this study with considerable interest and will submit to the Congress any proposals resulting from the study which seem desirable. A HEALTHY AGRICULTURAL ECONOMY Abundance is the primary goal of our farm policy--abundance that can guarantee lower food prices for every American and higher incomes for all American farmers. Five years ago, agriculture was a troubled industry: --Government controls were reducing incentives for production and costing the taxpayers over $3 billion a year in farm subsidies designed to hold down production. --Farm income was low ($14.7 billion) and the long hours worked by farmers earned them an average income that was 26 percent below the nonfarm average. Farm families had been leaving the farm at an average rate of over 100,000 a year. Today, that picture has been dramatically altered: --Farm markets have expanded dramatically. Farm exports have set new records in each of the last four years, becoming the largest single factor in the Nation's balance of payments and strengthening the dollar in international money markets. --Farm production has reached new record levels in each of the last three years, and a new record harvest should be forthcoming in 1974. --The billions of tax dollars which used to go for farm price support payments for basic commodities every year will be reduced to nearly zero. --Farm income has reached record levels. By 1973, the gap between farm income and nonfarm income had closed from 26 to 7 percent. Net farm income was up from $14.7 billion to $26.1 billion. We are making this progress not through more Government regulation but less. One of the proudest achievements of this Administration was the enactment of the Agriculture and Consumer Protection Act of 1973, which places production decisions where they belong--with farmers, not with the Government. A primary challenge for Federal agricultural policies now is to encourage greater production of agricultural goods-which will mean more income for the farmer, greater international trading benefits for the Nation, and reasonable food prices for the consumer. I am therefore asking the Congress to revamp the programs which still require restrictive Federal control over the production of some remaining farm commodities--especially rice, peanuts, tobacco, sugar, and extra long staple cotton. To further enhance agricultural activity, the Administration will also: --Promote longer-run soil and water conservation practices. --Consolidate the locations of local offices of Federal agricultural agencies-specifically, the Agricultural Stabilization and Conservation Service, the Soil Conservation Service, the Farmers Home Administration, and the Federal Crop Insurance Corporation--creating one-stop agricultural service centers on the local level to make things easier for the farmer and less costly for the Government. --Place high priority on directing agricultural research into those areas which will assure plentiful agricultural goods at reasonable prices, maintain our competitive advantage in world agricultural production, and protect the land. At my direction, Secretary Kissinger recently proposed to the United Nations that it convene a World Food Conference, a concern made urgent by acute food shortages in many parts of the world. This conference, to be held in November of 1974, should prove of particular importance to the American farmer, whose extraordinary productivity has made this Nation the world's leading food exporter and whose own prosperity will continue to increase as we help to meet the needs of a hungry world. Our farm policy must of course address not only the needs of the farmer but also those of the consumer. During 1973, we experienced a period of rapidly increasing food prices. Those prices leveled off in late 1973, but now we appear to be heading into a period of increasing food prices for at least the next few months. It is our intention to hold these increases to the smallest possible rate through executive actions such as lifting the quota on wheat imports, an action that I took last week. But the most significant force in the battle against higher food prices is higher production. This summer and fall, the large 1974 harvest should be coming on the market, serving as the best possible damper on higher prices. ECONOMIC SECURITY One of the most significant legislative achievements of 1973 was the enactment of the Comprehensive Employment and Training Act (CETA). A form of manpower revenue sharing, this bill transfers from the Federal Government to States and localities significant control over the design and operation of programs to improve the employability of the unemployed and the underemployed. CETA is a landmark of the New Federalism. It is also a landmark on the way to better manpower programs. Under this legislation, State and local governments will be able to use Federal funds to meet locally-determined needs and to devote special attention to employment problems with particular local impact-as, for example, those that might arise in certain areas as a result of the present energy shortage. In my new budget, I am including an additional $250 million for CETA in the current fiscal year, and $350 million in the year beginning July I, for distribution to areas with high unemployment. Overall, I am requesting more than $2 billion to fund our training and employment programs in the coming year. Other proposals related to economic security that I made to the Congress last year, and on which I again urge action, include: --The establishment of minimum vesting, funding and fiduciary standards for private pension programs, so that workers could have greater assurance of receiving the pensions they expect and deserve when they retire. I urge that we work together to resolve speedily the remaining disagreements and to enact responsible legislation which increases employee protection without burdening employers to such an extent that existing plans are jeopardized or new ones discouraged. --Extension to State and local governments of the law forbidding employment discrimination against older workers. --Improvement of the Federal-State unemployment insurance program in several ways: by increasing the State limits that keep some unemployed workers from receiving a reasonable proportion of their normal wage, by extending coverage to farmworkers, and by prohibiting payment of benefits to strikers while assuring benefits to non-participants unemployed as a result of a strike. These general improvements in unemployment insurance should be augmented by a special extension of present benefits for those specific areas of the country which experience particularly high levels of unemployment over the next 12 months. In addition, basic coverage should be provided for those in these areas who do not at present have any unemployment insurance. I will submit special legislation to achieve this purpose. I also continue to support legislation to raise the minimum wage. Higher prices have eroded the purchasing power of workers receiving the current minimum wage. But we must be careful to guard against enacting a bill which includes sharp increases or coverage extensions that would keep low income workers from being employed or a bill with a minimum wage for youths so high that we unwittingly deny them jobs. Finally, we must attack one of the most troublesome problems faced by both rural and urban areas; the existence of persistent and often severe unemployment or low incomes in areas whose character has been altered by changes in our economy and technology. Within the next several weeks, I will propose an Economic Adjustment Assistance program to help States and communities in overcoming problems caused by structural changes in their economies. This program would replace the present Economic Development Administration and the Regional Action Planning Commissions after a period of orderly transition. INCOME SECURITY One measure of a nation's character is the respect it accords to its elderly. Another is the way it helps those in need. We can be proud of the efforts we have made, but it is time to reassess where we are and what direction we should take in the future. We can take pride in the fact that: --Cash benefits under social security have risen from $26 billion in fiscal year 1969 to $63 billion in fiscal year 1975, primarily as the result of five benefit increases totaling almost 70 percent and reaching 19 million persons. --A program of Supplemental Security Income has been initiated and will soon be providing benefits to more than 5 million of the low-income aged, blind, and disabled, on a uniform, nationwide basis in a way that respects their dignity. But our income security programs need more than improved benefits. Over the past thirty-five years, a multitude of federally funded programs has grown up whose primary purpose is income security for those in need. Each of these efforts reflects a humane attempt to respond to a worthy goal. However, as cash, in-kind and service programs have rapidly expanded in the past few years, two things have become painfully clear: --First, the result is an extremely costly set of generally unrelated, uncoordinated programs with many unintended and undesirable consequences; and --Second, these efforts neither efficiently nor equitably accomplish the overall objective of assisting lower income families and individuals to achieve greater economic independence. The fact that a third of the new Federal budget--$100 billion--will be spent on income security programs in fiscal year 1975, compared to the $38 billion, or one-fifth of the budget, which they received just five years ago, highlights the need to rationalize and integrate our income assistance programs. As long ago as 1969, I called for a complete overhaul of our discredited welfare programs. I said then that "whether measured by the anguish of the poor themselves, or by the drastically mounting burden on the taxpayer, the present welfare system has to be judged a colossal failure." At that time, I proposed the Family Assistance Plan. Neither the Congress nor the country, accepted that proposal. I do not intend to resubmit a new version of the Family Assistance Plan. Since then, we have made a concerted effort to improve the administration of the existing programs. In 1973, for the first time in recent years, because of vigorous new Federal and State initiatives to enforce the rules more strictly, growth in the Aid to Families With Dependent Children case load was halted. But, in their overall impact, the welfare programs remain a failure and an outrage. As an example of the failure, recent studies have shown that fully 40 percent of the AFDC benefits being paid are either going to ineligible persons or are incorrect in amount. This performance is not just the result of fraud, although there is some of that. It is primarily and overwhelmingly the result of a system which is so complex and so riddled with obscure, obsolete and incomprehensible regulations that it defies fair and efficient administration. I plan to make a major new effort to replace the current maze of welfare programs with a system that works. This task will be difficult, but we have no other alternative, save further waste--both of lives and dollars. I welcome the evidence that thoughtful Members of the Congress, after careful study, have reached the same conclusion. While this effort goes forward, I will make every possible effort to improve the operation of the existing programs through administrative reforms, recognizing that a replacement system cannot be developed, enacted, and put into operation overnight. But, unless we move urgently to the development of a new system, efforts to improve the administration of the present programs wilt eventually be undermined by their basic structural flaws. In the development of my proposal, I will be guided by five principles: (1) All Americans who are able to work should find it more rewarding to work than to go on welfare. Americans would strongly prefer to have good jobs rather than a Federal handout. While we should provide cash assistance to those in need, we must always encourage complete self-support for those who are capable of it. (2) Cash assistance is what low-income people need most from the Federal Government. The people themselves, not the Federal Government, know their own needs best. (3) We need to focus Federal help on those who need it most. People in need should receive equal treatment from the Federal Government regardless of their place of residence. (4) The new system should be as simple as possible to administer with rules that are clear and understandable. It should be based on objective criteria rather than the personal judgment of administering officials. And it should be efficient. (5) This new approach should not require an increased tax burden for any of us. Too much of the income of all of us now goes to support Government. We help no one--certainly not those in poverty-by weakening our free enterprise system by even higher taxation. Starting from these basic principles, I believe we can develop a new system which would ensure that those who can help themselves do help themselves, and which would allow those who cannot help themselves to live with dignity and self-respect. IMPROVING OUR PEOPLE'S HEALTH In February of 1971, I outlined to the Congress a new national health strategy to assure that no American would be denied access to high quality medical care because of an inability to pay. Much has already been accomplished toward meeting that objective. A little over two years ago, I took special satisfaction in signing into law the National Cancer Act, which enabled us to launch an accelerated effort to conquer this dread disease. Considerable progress has been made in our attack on cancer and there is much hope that additional knowledge can be developed in the future. In the budget that I will submit to the Congress next Monday I plan to ask for an additional $100 million above last year's request of $500 million for the expanded attack on cancer. In addition, biomedical research in other areas, including heart disease, has been intensified--and the total 1975 budget for biomedical research will exceed $2 billion, more than double the total in fiscal year 1969. We are also making headway toward increasing the Nation's supply of health manpower. During the last ten years, first year medical school enrollments have grown by more than 55 percent. The number of other health professionals also can be expected to grow dramatically. Just last month, I approved legislation along the lines I requested in 1971 to permit the Federal Government to support the demonstration of health maintenance organizations across the Nation. During both 1974 and 1975, $125 million will be provided through health maintenance organizations to demonstrate the benefits of prepaid health care to our citizens. Federal programs to finance health services for the aged, for the disabled, and for low income persons have been greatly expanded. Since 1969, Medicare and Medicaid coverage has been extended to an additional 21 million aged, disabled, and low-income Americans. The range of services covered under Medicare and Medicaid has also increased. Consumer safety programs--to assure safe foods, drugs, cosmetics, and other consumer products--have received almost a fourfold increase in Federal funding since 1969. Despite all these advances, however, too many Americans still fail to receive needed health care because of its costs. And too often the costs of health care threaten our citizens with bankruptcy while the services that can prevent or cure disease are not fully utilized. As one of my major new initiatives for 1974, I shall soon submit to the Congress a comprehensive health insurance proposal which would: --Make available health insurance protection to millions of Americans who currently cannot obtain or afford the private health insurance coverage they need. --Provide all Americans with vastly improved protection against catastrophic illness. --Place a new emphasis on preventive health care. --Provide State and Federal subsidies for low-income families, and for those whose special health risks would otherwise make them uninsurable or insurable only at exorbitant expense. My comprehensive health insurance proposal will build upon the strengths of the existing health system, rather than destroying it. It will maintain the high quality of medical care without requiring higher taxes. It will be based on partnership, not on paternalism. And most importantly, it will. require doctors to work for their patients, not for the Federal Government. This plan would require that employers offer a comprehensive health insurance plan to all their full-time employees, with the employer paying a share of its costs. The role of private health insurance in financing health care would be expanded and the consumer's opportunity to choose between competing health insurance plans would be enhanced. In addition to this plan, there are a number of other health-related measures that I urge the Congress to enact this year. These include: --A Health Resources Planning Act, to help States and localities improve their planning and use of health resources; --New and expanded national health service scholarship legislation, to increase the number of Federal scholarships available to students in health professions, and also to help ensure that the Federal Government can meet its needs for physicians; and, --A general expansion of the guaranteed student loan program, to provide adequate financial assistance to all professional and graduate students, including health professionals. IMPROVING EDUCATION The Federal Government should provide strong leadership in assuring equal access to a high quality education for all Americans and in bringing about renewal and reform of all of our education programs. Since 1969, we have raised Federal spending for education from $4.3 billion to $7.6 billion--an increase of 76 percent. In special messages to the Congress on education in the past, I set forth five major proposals to improve American education. They were: --A new program of student assistance to help to ensure--for the first time in the Nation's history--that no qualified person is barred from attending college by lack of money. --A National Institute of Education, to be the focal point for educational research and development aimed at increasing our knowledge of how to help students learn. --A National Foundation for Higher Education, to encourage innovation in learning beyond high school. --An Emergency School Aid program to assist desegregating school districts. --A thorough reform of the programs for Federal support of elementary and secondary education, consolidating the myriad separate categorical grant programs in order to transfer educational decisions back to the State and local levels where they belong. The first four of these basic proposals have been enacted, in whole or in part, and a great deal has already been accomplished through them. As for the fifth, reform of Federal funding for elementary and secondary education, I believe that 1974 should be the year of its enactment. COLLEGE STUDENT ASSISTANCE The Basic Educational Opportunity Grant Program is the primary vehicle in my effort to ensure that no qualified student be denied a college education because of lack of funds. In my new budget, I am asking Congressional approval to strengthen this program by providing grants of up to $1,400 a year for needy students. Altogether, when combined with other student funding efforts, the Federal Government in the coming fiscal year would provide an estimated $2.2 billion of financial aid to post-secondary students, an increase of over $900 million from the level of five years ago. Since the present student assistance programs are targeted to help the neediest, and because the costs of higher education have risen dramatically, many middle income students are now finding it increasingly difficult to make ends meet. I therefore also recommend that the limit on total borrowing be increased so that professional and other graduate students will be able to find adequate student loans. EDUCATIONAL RESEARCH AND DEVELOPMENT When I originally proposed the creation of a National Institute of Education, I suggested that providing equal opportunity for quality education means, in part, increasing our knowledge about the ways that students learn and then changing the way we teach them. For too long we have followed the belief that bigger educational programs are necessarily better educational programs and that money alone can solve our educational problems. But now we are beginning to see that the quality of our thinking about education can be as important as the size of our educational budget. The National Institute of Education can help us to marshal our educational resources in ways which will produce the best results. It has already begun to provide the kind of leadership in educational research and development which I have long believed was needed. EDUCATIONAL INNOVATION BEYOND HIGH SCHOOL While the National Foundation for Higher Education which I proposed in 1970 has not been established, the Fund for the Improvement of Post-secondary education was set up by the Congress. The fund is now providing support for the development and demonstration of more effective approaches to college level education. Our initial assessment leads me to believe that the fund will, in the years to come, become the primary focal point for innovation in higher education. ASSISTING SCHOOL DESEGREGATION Under the Emergency School Aid Act of 1972, an estimated $467 million in Federal funds will have been provided to local school districts by the end of 1975 to assist in the process of elementary and secondary school desegregation, to encourage voluntary programs to overcome minority group isolation, and to assist in meeting the educational needs of children who, because of racial isolation, have not had an equal educational opportunity. By the 1975-1976 school year, the bulk of the problems incident to "de jure" segregation should have passed. However, to provide assistance to those other school districts which may still be required to take special desegregation measures as the result of court rulings, I have budgeted an additional $75 million for fiscal year 1975. In addition, the Federal Government will continue to provide civil rights education advisory activities to local districts to assist them in meeting any remaining problems. BUSING I have often .expressed my opposition to the use of forced busing for purposes of achieving racial balance. I have also proposed legislation which would dictate reasonable limits on the use of forced busing, and I have opposed the consolidation of school districts in an effort to achieve racial balance in the larger district. Such consolidation plans have only led to more busing and the eventual disappearance of the neighborhood school. The end result of an excessive reliance on forced busing and the imposition of arbitrary ratios has frequently been an increasing concentration of the poor and minorities in our central cities and the serious weakening of the very school systems which must serve them. In some cases, the education of minority children has actually suffered, not benefitted, from such plans. I shall continue to support the passage of legislation which makes busing only a last resort tightly circumscribed even then. I will also continue to work with the Congress to revise my proposals in light of unfolding events in this area. FUNDING ELEMENTARY AND SECONDARY EDUCATION I am encouraged by the interest the Congress has continued to show in legislation which follows the concepts put forward in my proposed Better Schools Act. I believe that meaningful compromise is now possible, and that we can at last reform and consolidate Federal grants for elementary and secondary education, vocational programs and adult education. I hope that the Congress will include four basic elements in this reform: --Consolidation of existing categorical grant programs. --Granting greater decision-making authority to State and local educational agencies. --Greater equity in the distribution of Federal funds to the States for the education of disadvantaged children. --Reform of the impact aid program to concentrate support in those districts where the Federal presence has substantially decreased the tax base, rather than those in which it has increased the tax base. Upon enactment of legislative authorities that accomplish these goals for elementary and secondary education, vocational programs and adult education, I will propose special supplemental appropriations to provide funding for the 1974-1975 school year. This funding would place most elementary and secondary education grant programs on a "forward funded" basis, letting State and local agencies know how much they will receive while plans for the next school year are being made. "Forward funding" is an important concept in the financing of education, and it merits the full support of the Federal Government. As I noted in my message sent to the Congress on education policy last week, I also recommend additional support for several other educational programs-some old and some new. These include: --An additional increase in aid to black colleges and other developing institutions during fiscal year 1975, thus quadrupling Federal funds for these important educational institutions since I took office. --Continuation and extension of the Head Start program, our single largest child development program. In 1975, Head Start will reach 282,000 disadvantaged youths year-round, as well as some 78,000 pre-schoolers during the summer-and it will extend its activities to include handicapped youth. --The consolidation of eight separate authorities for education of the handicapped into four broader and more flexible programs. NON-PUBLIC SCHOOLS I remain firmly committed to the principle of educational diversity. The continued health of the Nation's non-public schools is essential to this concept. Although governmental efforts aimed at supporting these schools have encountered difficulty in the courts, I believe we must continue our efforts to find ways to keep these schools open. For that reason, I continue to support legislation which permits tax credits for parents who pay to send their children to non-public schools. HELPING OUR VETERANS Twenty-nine million Americans living today have given military service to their country. As a group, veterans are among our most productive citizens. Studies show that they generally have higher incomes, more education, and better health than non-veterans of the same age. We can be proud of the veterans' contributions, but we must also be concerned for those veterans and veterans' families who remain in need. The assistance provided to veterans and their families in recent years has been substantial: --Total compensation payments for veterans disabled or killed in military service have been increased from $2.7 billion in 1969 to $3.9 billion in the coming fiscal year. --Medical care in VA hospitals and clinics has been greatly improved and expanded, with ten new or replacement hospitals now in service and five more in preparation. --Educational benefits per trainee have more than doubled since 1969. --Last year two key measures--one expanding health care and the other improving the national cemetery system for veterans--were passed and signed into law. --Of vital importance, the unemployment rate for Vietnam era veterans has been sliced from 11 percent in early 1871 to 4 percent by late 1973. As a result, Vietnam era veterans have a higher employment rate than others of their same age, a significant achievement that is well deserved. Earlier this week, in a special message to the Congress, I proposed additional legislation to help veterans in two crucial areas in 1974--pensions and education. My pension proposals would benefit some I million veterans and 1.3 million veterans' survivors who are in economic need because of disability, age, or the loss of a breadwinner. VA pensions already go a long way toward meeting such needs, but the pension structure itself is fraught with inequities and anomalies that are technical in nature but tragic in consequence. My proposals would correct these deficiencies. Veterans now in training require additional help if their GI bill allowances are to keep pace with rising costs. I shall therefore propose that GI bill benefits be raised by an average of 8 percent. I have also set a 1974 goal for the Government of placing an additional 1.2 million veterans in jobs or job training. There remain sizable numbers of educationally disadvantaged veterans and service-disabled veterans who have never taken advantage of Federal training opportunities and are now unemployed. I have directed that, as a matter of high priority, the Federal Government's efforts to reach these veterans be intensified and that they be counselled and encouraged to use the available services. EQUAL OPPORTUNITY FOR ALL AMERICANS This Administration has made a determined effort to secure equal opportunity for those who have been previously denied such opportunity. I am personally very proud of the success those efforts have already achieved, and I am committed to building on that success in the future. PROGRESS FOR MINORITY GROUPS Members of racial minority groups have made considerable strides toward equal opportunity in recent years. The following are among the more notable benchmarks of this progress: --Setting an example as an Equal Opportunity Employer in the past five years, the Federal Government has added more than 35,000 minority group members to its civilian employee roles. --In the Armed Forces, more than 850 minority-group cadets are now enrolled in the military academies; and whereas prior to 1971 only four minority group members had ever achieved general or flag rank in the armed forces, now sixteen serve on active duty as generals and admirals. --Federal aid to minority business enterprises-- one of the cornerstones of the Administration's effort to open new economic horizons for minority group members-has nearly tripled since 1970. --Civil rights enforcement activities have continued at a vigorous level, with their funding substantially increased. --Since 1969, combined Federal expenditures on civil rights activities and minority economic development programs have grown from less than $1 billion to $3.5 billion. --Five years ago 68 percent of all black children in the South were still attending all-black schools. Now that figure has been reduced to 8 percent, and the dual school system has been virtually eliminated. --The Government has also sought to expand job opportunities through legal actions of its own against those who may be engaged in discriminatory practices. During 1972 and 1973 the Department of Justice initiated 34 pattern and practice lawsuits against approximately 207 defendants. These suits directly covered more than 248,803 employees. During the same period of time, approximately 37 cases were fully resolved by entry of decrees and an additional six were partially resolved by the entry of decrees. The decrees entered in those two years alone covered more than 217,000 employees and provide specific goals for the hiring of more than 21,800 minorities and women in traditionally white and male jobs. In addition, those decrees provide new transfer of seniority rights for approximately 12,700 minorities and women and provide for back pay awards which are estimated to amount to well over $6,000,000. The real story lies not in these figures themselves, but in the facts and the attitudes they represent. They do not represent a flamboyant promise, but rather a quiet determination to work not only toward the symbols but also toward the substance of equal opportunity. They represent an effort to build foundations that will last--in particular, the foundation of economic independence, and of a basic faith in the equal dignity of mankind. JUSTICE FOR AMERICAN INDIANS For too many years the American Indians-the first Americans--have been the last Americans to receive the rights and opportunities to which they are entitled. This Administration has taken the initiative to change this picture. For its part, the Federal Government must put behind it the role of autocratic manager of Indian reservations. We shall continue to encourage Indians and their tribal governments to play an increasing role in determining their own future. We are also particularly determined to defend the natural resources rights of Indian people. The last five years have been historic steps in Federal Indian policy. In 1971, we worked closely with Indian leaders to achieve a settlement of Alaska Native claims, a settlement consistent with America's sense of fairness and also indispensable to the growth and development of all of Alaska. We also returned lands taken away long ago from the Taos Pueblo at Blue Lake. We returned lands wrongfully taken from the Yakima people. Because the Menominee people have seen their tribal states involuntarily terminated but had nevertheless kept their land and their tribal structure together, the Congress enacted and I signed the bill which restored the Menominee tribe to trust status. In the courts, we are forcefully asserting Indian natural resources rights, as we have done in protecting Indian rights in Pyramid Lake. One measure of our attempt to foster a better, more humane policy is the level of Federal funding benefitting American Indians--over twice what it was five years ago or about $ 1.6 billion. I am especially encouraged by the fact that the rate of infant deaths, pneumonia, influenza, and tuberculosis is significantly lower among Indians than ever before. Although we have not yet achieved our full goals of health and educational services for the Indian people that are fully compatible with those of the general population, this progress demonstrates our continuing commitment. The Congress has shared in these accomplishments in a spirit of bipartisan cooperation. I hope that I will soon have on my desk two more enactments on which Congressional action is progressing: measures to speed Indian economic development and to upgrade the position of the Commissioner of Indian Affairs to the Assistant Secretary level. Also still awaiting Congressional action are four other proposals I have submitted previously: to permit turning over to Indian tribal governments the management and control of Indian programs; to create an Indian Trust Counsel with authority to safeguard Indian natural resources rights; to help ensure that funds for Indian education actually reach Indian children; and to provide greater local control over federally assisted reservation programs through a program of tribal grants. Looking forward, I shall ask that the Bureau of Indian Affairs make specific plans to accelerate the transfer of significant portions of its programs to Indian tribal management, although I repeat my assurance that, while accelerated, these transfers will not be forced on Indian tribes not willing to accept them. THE SPANISH-SPEAKING The Spanish-speaking citizens of our Nation face special problems in obtaining equal opportunities because of language and cultural barriers. For that reason, my Administration has made a special effort to expand those opportunities. Our progress on this front is reflected in many ways. Nearly 3,800 Spanish surnamed Americans have been employed by the Federal Government, despite an overall reduction in Federal jobs. The Small Business Administration has also increased its loans to Hispanic businessmen, reaching a total of $109 million in fiscal year 1973. In 1969, the Cabinet Committee on Opportunities for the Spanish-speaking people was created. The Cabinet Committee has both made the Government more aware of the needs and the talents of Spanish-speaking citizens and helped to expand Federal employment of the Spanish-speaking. Since the authorization for this organization expires this year, I am asking the Congress to extend its life through June 30, 1975. The Cabinet Committee on Opportunities for the Spanish-speaking serves to focus the Administration's continuing efforts in this important area of concern. THE RIGHTS OF WOMEN Both men and women have become increasingly aware of the pattern of sometimes blatant but often subtle discrimination to which women are subjected. Some of this discrimination can be erased by existing law; some requires new law; some would be rectified by the Equal Rights Amendment, now nearing ratification by the required three-fourths of the States. It is my hope that the Equal Rights Amendment will be ratified speedily so that equal justice under our laws will become a reality for every American. One of the primary goals of this Administration is to ensure full equal employment opportunity for women by striving to open to women jobs that previously were reserved for men, often simply by habit or custom. Specifically, we have moved vigorously both to enforce the law and to lead by example---by insisting on equal employment and promotion opportunities within the Federal service, by promoting more women into the professionally critical areas of middle management and by continuing our special recruiting drive to bring more women into the highest levels of Government. To help advance these goals I have appointed the first woman Counsellor to the President, and she, in turn, has set up a new Office of Women's Programs within my executive office. We are particularly proud that this Administration is the first to have women as heads of three independent Federal agencies--the Atomic Energy Commission, the Federal Maritime Commission, and the United States Tariff Commission. The effort to improve the economic status of women outside the Government is also continuing. The Equal Employment Opportunity Commission, which has been given enforcement power in the Federal Courts, has reported a marked increase in its activities to end sex discrimination in employment. We will continue to pursue all these efforts with vigor. This emphasis is especially appropriate as we approach 1975, which has been declared International Women's Year by the United Nations. One especially invidious form of sex discrimination in particular is ripe for correction now through new legislation: the discrimination that often denies women equal access to credit. In an economy that increasingly operates on credit, this is a particularly grievous practice. The Congress already has before it a proposal to ensure that credit is extended to all persons on an equitable basis, without regard to their sex or marital status. This Administration strongly supports this proposal and is sending to the Congress amendments which we believe will strengthen it even further. I urge prompt consideration and passage of this vital legislation. PROTECTION AGAINST CRIME AND INVASIONS OF PRIVACY Over the past five years I have had no higher domestic priority than rolling back the tide of crime and violence which rose in the 1960s. I am therefore especially pleased with the progress we are making on this front: --After 17 years of continuous and often dramatic increases, crime in 1972 registered its first overall decline. Although in 1973 it again registered a slight increase, it still held below the level of 1971. Now that the momentum of increase has been broken, I am confident that we can look forward to further reductions in crime rates in the years ahead. --Serious crime in our largest cities was actually reduced by 13 percent between 1971 and 1973. --In Washington, D.C., where the Federal Government has special law enforcement responsibilities, crime has been cut in half since 1969. Indictments and convictions of organized crime racketeers have more than tripled since 1969, thanks in large measure to the 1970 Organized Crime Control Act and to expanded Federal interagency strike forces. In addition, of course, the riots, urban terrorism and burnings of the 1960s have now become a thing of the past. These indications of success do not mean that we should slacken our anti-crime effort, but that we should intensify it. Key elements of our strategy to do so--most of which will require the assistance of the Congress--include: --Comprehensive reform of the Federal Criminal Code. Last year I submitted a proposal which was based upon the work of the Justice Department and a five-year study completed by the National Commission on Reform of Federal Criminal Laws. The Federal criminal code has not been completely revised in a quarter century and the need for reform is urgent. I call upon the Congress to act expeditiously in reforming our criminal code, to make it both more workable and more responsive to the demands of our complex society. --Restoration of the death penalty under the Federal Criminal Code for several especially heinous specific crimes which result in the death of innocent victims. Examples of such crimes are hijacking, kidnapping, or bombing. --Increased Federal assistance to State and local law enforcement agencies. For the next fiscal year, I propose funding through the Law Enforcement Assistance Administration of $886 million--up from only $60 million in 1969. --Increasing the resources available to the YOU.S. Attorneys' offices throughout the Nation----offices which have, in the last three years, increased the number of criminal convictions by 28 percent. --Creation of additional Federal judgeships to assure speedier disposition of criminal cases. Legislation to accomplish this goal is now before the Congress. --Comprehensive improvement of Federal correctional programs. Already 15 additional correctional institutions have been built, acquired or begun. My 1975 budget request would represent a tripling of 1969's budget levels. --A new effort to deal more effectively with employment problems caused by the increase in the number of illegal aliens entering this country. Legislation to achieve this objective is also before the Congress. PROTECTING THE RIGHT OF PRIVACY One of the basic rights we cherish most in America is the right of privacy. With the advance of technology, that right has been increasingly threatened. The problem is not simply one of setting effective curbs on invasions of privacy, but even more fundamentally one of limiting the uses to which essentially private information is put, and of recognizing the basic proprietary rights each individual has in information concerning himself. Privacy, of course, is not absolute; it may conflict, for example, with the need to pursue justice. But where conflicts occur, an intelligent balance must be struck. One part of the current problem is that as technology has increased the ability of government and private organizations to gather and disseminate information about individuals, the safeguards needed to protect the privacy of individuals and communications have not kept pace. Another part of the problem is that clear definitions and standards concerning the right of privacy have not been developed and agreed upon. I have therefore ordered an extensive Cabinet-level review--which will be undertaken this year--of both government and industry practices as they relate to the right of privacy, of the conflicts that arise and the balances that must be struck between legitimate needs for information and the right of privacy, and of those measures--including appropriate legislation-that can be taken to ensure that these balances are properly struck. ENDING DRUG ABUSE During the decade of the '60s, increasing numbers of Americans--including a high percentage of young people--each year turned to heroin and other drugs in search of "new highs" and "synthetic solutions" to the problems of life. In this retreat from reality, the Nation's drug problem grew dramatically. Residents of our proudest cities were gripped by fear as addicts turned to crime to support their habits, and thousands of families suffered devastating personal tragedies. I am pleased to be able to report that since then, Federal spending on drug treatment and enforcement have increased tenfold, and progress has been made. We have indeed turned the corner on hard drugs: --Better drug law enforcement, at home and abroad, has caused an acute heroin shortage throughout much of the country. --Enough treatment capacity has now been created so that virtually all addicts who want medical help and counselling can get it. --Our drug abuse indicators all suggest that we have at last succeeded in reducing both the total number of heroin addicts and the number of new addicts. Nevertheless, the drug battle is far from over. For the sake of the next generation, I am determined to keep the pressure on-to ensure that the heartening progress made to date is translated into a lasting victory over heroin and other drugs. As enforcement efforts meet with success in one area of the world, pressure increases on other trafficking routes. To meet these new threats, we will step up our support of joint drug enforcement programs. I have also directed that plans for increased vigilance at our own borders be put into effect. In the treatment area, we are intensifying our efforts to encourage hard-core addicts to undergo treatment. To provide added incentive for those not motivated to seek help on their own, I have directed Federal agencies to expand their support for local programs which direct addicts charged with crimes into treatment pending trial and sentencing. Continued progress will also require help from the Congress: --I will shortly recommend severe new penalties for both heroin traffickers and those engaged in illegal distribution of other illicit drugs. This legislation will supplement my proposals currently pending before the Congress. --The Psychotropic Convention, a key international treaty regulating manufactured drugs worldwide, has--after 2 1/2 years--still to be ratified. Affirmative action in this session is of the utmost importance. I will continue to pursue a balanced approach to the drug problem in the next year by emphasizing both vigorous law enforcement, and treatment and rehabilitation programs to help speed the return of ex-addicts to productive lives in society. ENHANCING THE ENVIRONMENT Both our Nation and the world have made imposing strides during recent years in coping with the problems of our natural environment. Building upon well-justified concerns, we have created institutions, developed policies and strategies, and deepened public understanding of the problems that face us. Now we are entering the second phase of environmental action. It may prove to be a more difficult period. In this second phase, we will be looking at our environmental problems in new ways which are more complex and far-reaching than those to which we have been accustomed. We must be concerned not only with clean air, clean water and wise land use but also with the interaction of these environmental efforts with our need to expand our energy supplies and to maintain general prosperity. In facing up to these tough, new problems, we can draw strength from the progress we have already made and from the knowledge that there can be no turning back from our general commitment to preserve and enhance the environment in which we live. Our record over these past five years includes the vigorous enforcement of air quality legislation and of strengthened water quality and pesticide control legislation, the enactment of new authorities to control noise and ocean dumping, regulations to prevent oil and other spills in our ports and waterways, and legislation establishing major new parks, recreation and wilderness areas. We have also tried to reorganize the Federal structure in ways that are more responsive to environmental needs. The National Environmental Policy Act, passed in 1969, has provided a basis for reform in our Federal agencies and has given citizens a greater opportunity to contribute to environmental decisions. In 1970, I established the Environmental Protection Agency and National Oceanic and Atmospheric Administration to provide more coordinated and vigorous environmental management. Also in that year, I appointed the first Council on Environmental Quality. PRODUCING RESULTS The results of our vigorous anti-pollution efforts are now being seen and felt. In our major cities, levels of dangerous sulfur oxides and particulates have declined, and pollutants from automobiles have been reduced. Water pollution is being conquered, assisted by a massive Federal commitment of over $14 billion in municipal treatment plants during this Administration. Major misuses of pesticides are now under control, and major sources of noise are being regulated for the first time. During these five years, Federal agencies have acquired over 800,000 additional acres for preservation for future generations, many of them near our heavily populated urban centers such as New York and San Francisco. In addition, the Legacy of Parks program, which I initiated in 1971, has made massive strides in bringing parks to the people. To date, 400 separate parcels covering almost 60,000 acres of under-utilized Federal lands in all 50 States have been turned over to State and local governments for park and recreational use. Many of them are near congested urban areas. We will continue to expedite transfer of additional surplus properties to State and local governments for park and recreation use. IMPROVING THE WORLD ENVIRONMENT On our small planet, pollution knows no boundaries. World concern for the environment is as necessary as it is encouraging. Many significant international actions have been taken in recent years, and the United States can be proud of its leadership. These actions have included the signing of international conventions to protect endangered Species of wildlife, to regulate ocean dumping, to extend the national park concept to the world, and to control marine pollution. A United Nations Environment Program was established last year. With it, the UN Environment Program Fund came into being, fulfilling a proposal I had made in 1972. Under the US-USSR Environment Agreement, which I signed in Moscow in May, 1972, Soviet and American scientists and environmentalists have been actively working together on serious environmental problems. THE CHALLENGE AHEAD As part of this Administration's continuing effort to conserve outdoor recreation areas, my new, budget will propose full funding of the Land and Water Conservation Fund for 1975. Nearly two-thirds will aid State and local governments in acquiring their own recreation lands and facilities. Coupled with the change I have proposed in the formula for allocating funds to the States, this measure would encourage the development of more recreational sites closer to the places where people live and work. This year we have the unique opportunity and responsibility to determine the future use of enormous land areas in America's last great frontier--Alaska. Last month, in accordance with the Alaska Native Claims Settlement Act, I transmitted to the Congress recommendations that would add 83.47 million acres in Alaska to the National Park, National Forest, Wildlife Refuge and Wild and Scenic Rivers Systems. If the Alaska frontier is thoughtlessly developed, it will be gone forever. But we now have the opportunity to make considered judgments as to the appropriate uses of these outstanding Alaskan lands for the American people of all future generations. This session of the Congress has before it 17 major natural resources and environment proposals that I have previously submitted, and on which I again recommend action. These include: --Department of Energy and Natural Resources: While I discuss this new department elsewhere in this message, I want to reemphasize that I consider it of cardinal importance in ensuring that complex, interrelated environmental and natural resource issues receive an appropriately wide policy overview and administrative coordination. ---National Land Use Policy: Adoption of the National Land Use Policy Act, first proposed in 1971, remains a high priority of my Administration. This legislation would reaffirm that the basic responsibility for land use decisions rests with States and localities--and would provide funds to encourage them to meet their responsibility. I am pleased that the Senate has passed legislation incorporating some of the policies that I proposed. I urge the Congress to pass legislation which would assist States and localities, but which does not inject the Federal Government into their specific land use decisions. --Coastal Wetlands: These environmentally vital wetlands are increasingly threatened by development. My proposed Environmental Protection Tax Act would amend Federal tax laws to discourage the unwise use of these areas, and to enhance our opportunities for sound land use planning within the coastal zone. --Wilderness: Traditionally, we have looked westward for our wilderness areas. Last year, however, I proposed that 16 Eastern areas be designated as "wilderness" and that 37 others be studied for possible wilderness designation. --Historic Preservation: Because we have an irreplaceable historic and architectural heritage, I have proposed an Environmental Protection Tax Act to discourage the demolition of historic structures and to encourage their rehabilitation. --Big Thicket National Biological Reserve: The Big Thicket area of east Texas is a biological crossroads unique in the United States. I am gratified that the House has acted and I urge the Senate promptly to consider my proposal to preserve key segments of the Thicket in a Big Thicket National Biological Reserve. --Big Cypress National Fresh Water Reserve: Protection of the Big Cypress Swamp in Florida is essential to the preservation of the water supply in the Everglades National Park. I have recommended legislation which would authorize the acquisition of over 500,000 acres, enabling us to protect this vital water supply. --Public Land Management: The Secretary of the Interior needs additional authority to protect the environmental values of our public domain lands. I again urge that he be given that authority. --Controlling Pollution: Three of my legislative proposals aimed at controlling pollution have not yet received final Congressional action: --Toxic Substances: New chemicals with unknown environmental effects come into use each year. Authority to test these substances and to restrict their use in the event of danger, while still permitting the orderly marketing of needed chemicals in a timely fashion, is highly desirable. --Hazardous Wastes: Disposal of wastes on land is increasing due to advances in industry and technology and because of our stringent controls on air and water pollution. These wastes can be hazardous to human health and other forms of life. My proposal provides for national standards for treatment and disposal of hazardous waste with primary regulatory responsibility resting with State governments. --Safe Drinking Water: The water we use in our homes should not endanger our health. Under my proposal on safe drinking water, Federal standards would provide health protection by requiring strict limitation of any contaminants in drinking water, but primary enforcement responsibilities would be left to the States. Alternative legislation is now being seriously considered by the Congress which would require unnecessary Federal standards on operating treatment plants, generate a domineering Federal enforcement role, and create several new categorical subsidy programs. COMMUNITY DEVELOPMENT Although American communities share many of the challenges of our age, the relative intensity and the particular nature of these challenges vary sharply from one community to another. The current way of providing most Federal aid to our communities--with each dollar tied to a string pulled and manipulated by a Federal planner--is wrong. Much of the money that pays the Federal planners could better be spent in the local community; the decisions made by the planners could better be made by the people who live on the scene. In these past few years, we have sought to change the old system. We have recognized that the Federal policy that will work best is one that helps the people of a particular community define their own needs and meet those needs in the way which they consider best. While in this Administration we have tried to be generous, we have also tried to grant communities greater freedom to set their own priorities. Since 1969, we have: --Spent twice as much money on community development programs as the Federal Government had spent for this purpose in the entire previous history of the Nation. --Reduced the red tape and arbitrary restrictions on local action that were so much a part of these programs in the past. --Moved authority for administering community development programs from Washington to the field, where administrators are more accessible to local officials, and where they can become more familiar with local problems. --Stepped up Federal support for State and local planning and management, again spending more for this purpose than had been spent in all previous years combined. As a result, not only have cities received more Federal dollars, but they have been able to accomplish more with each dollar than before. Despite this progress, we need a much more sweeping reform than has been possible under existing laws. Therefore, I once again urge passage of The Better Communities Act, a $2.3 billion bill which would give local officials new flexibility and provide greater effectiveness in the expenditure of Federal community development funds. This legislation would consolidate seven categorical grant programs into a single program. Funds would be distributed on the basis of need, and then local communities could decide for themselves what projects should come first. Thus we could eliminate a mountainous volume of red tape and allow local government to play a larger role in determining their own destinies. Two Congresses have now addressed community development legislation. Both of them have agreed, for the most part, with the basic principles and approaches that the Better Communities Act represents. But we have still had no action. Cities and towns that have counted on having this legislation in effect in the next fiscal year now face an uncertain future. I urge the Congress to move ahead as quickly as possible with the Better Communities Act--and I pledge every effort to work out our remaining differences so that our cities and towns can benefit from this program as soon as possible. I also urged the 93rd Congress to pass the Responsive Government Act that I submitted last year. This measure would enable State and local officials to improve their planning, decision-making and managerial capabilities through broadbased, flexible grants. RURAL DEVELOPMENT Over $12 billion has been invested in rural development through Agriculture Department programs alone during the five years of this Administration. Annual Federal funding for these rural development programs has been tripled during that time. These funds have been spent for: --Rural housing, where more than $6.4 billion has been provided through 487,000 housing loans. --Electrification and telephone systems, where over $3 billion has been spent to bring service to 177,000 new rural consumers. --Water and waste disposal, where some 8,500 loans and grants totaling $1.4 billion have been provided to rural communities for water and waste disposal systems. --Loans to farmers, who received more than 489,000 loans totaling over $4.2 billion. In addition to these efforts under Department of Agriculture programs, almost 200 other Federal programs have had a significant impact on rural areas. As a result, rural residents receive as much Federal support per capita as residents of urban areas. During the past year we have markedly increased our activity on behalf of the Nation's rural residents: --During 1973, the Rural Development Act was funded for the first time to provide over $750 million in loans and grants to States under procedures which give them a new flexibility in promoting rural industrialization and in improving the quality of rural life. --An interim rural housing policy was developed, placing greater emphasis on more effectively utilizing existing housing and making Farmers Home Administration programs more responsive to those with the greatest housing needs. --To ensure continuing Government attention to rural development needs, this Administration has also created both a special Cabinet-level Rural Development Committee and the new post of Assistant Secretary of Agriculture for Rural Development. As we look to the future patterns of national growth, we must never forget that the prosperity, the vitality and the character of rural America are essential cornerstones of our Nation's balanced growth. It is essential that rural America receive its proper share of our attention--and I am determined that this shall be the case. HELPING DISASTER VICTIMS Seldom is swift and effective Government action needed so urgently as when a natural disaster strikes. Since taking office, I have had to declare over 160 major disasters in 42 States and in 3 territories. In recent years, the amount of Federal assistance given to disaster victims has been greatly expanded, and we have also pressed an intensive effort to provide this aid more equitably and expeditiously. Since more than 90 percent of all property damage resulting from natural disasters is caused by floods, I was especially pleased by the Congress approval last year of our proposed Flood Disaster Protection Act, which significantly expands and improves the national flood insurance program. More remains to be done, however, if we are to meet our basic humanitarian responsibility to those who fall helpless and innocent victims to nature on the rampage. Therefore, I have also proposed a Disaster Preparedness and Assistance Act, which places new emphasis on the essential element of preparedness, while also increasing the role of State and local officials in allocating Federal disaster funds and cutting the tangle of red tape. It also provides for the automatic use of Federal resources when major disasters strike, and it includes generous grant features for those individual disaster victims unable to repay Government loans, as well as for communities faced with the task of restoring damaged public facilities. That natural disasters will continue to strike is certain; the only uncertainty is how well prepared we will be. As a generous and compassionate Nation, we should be prepared to give the victims of these disasters the prompt and effective help they so desperately need. BETTER HOUSING FOR ALL As I have stated many times, this Administration will not waver from the Federal commitment first outlined in the Housing Act of 1949: "a decent home and a suitable living environment for every American family." The state of America's housing will continue to depend on the state of America's economy more than on any other factor. The forces of the marketplace are the forces that count the most-families with sufficient real income and sufficient confidence to create an effective demand for better housing on the one hand, and builders and credit institutions able to respond to that demand on the other. The Federal Government must play a major supporting role through its actions in the mortgage credit market and its help for low income families who need assistance in obtaining adequate housing. Last September, as credit for housing was becoming increasingly scarce, the Administration acted to make more credit available to home buyers. Recently, mortgage market conditions have begun to improve. However, to assure continuing improvement, I recently authorized a reduction in the maximum allowable interest rate for mortgages insured by the FHA, the Farmer's Home Administration and VA--a more than $6 billion mortgage insurance program that will assist in financing the construction of up to 200,000 housing units. These actions should have a favorable impact on housing production. If the anticipated results are not fully achieved I will recommend further action to ensure a reasonable level of production. In the last five years a substantial effort has been made to address the country's housing problems: --Largely because of a general upswing in the economy, housing production has occurred at record levels. --FHA mortgage insurance has enabled nearly 3 1/2 million families to purchase homes. --Over two million units of subsidized housing for low and moderate income families have been approved, more than during the previous 33 years of federally subsidized housing programs. --Over $1.4 billion has been committed to improving and modernizing existing public housing. --Subsidies to local housing authorities have grown from $33 million in 1969 to $350 million in 1974. Even as good housing has become a reality for most Americans, it is clear that important problems still exist. Two are especially significant. First, our credit institutions often encounter problems in providing adequate housing credit. Second, too many low income families are unable to obtain adequate housing--even as good housing sits vacant in their community. We must help them to meet their needs. In order to increase the availability of housing for all families, I urge passage during this session of two key measures I have already proposed: --The Financial Institutions Act to enable savings and loan associations to compete more effectively for funds during periods of tight money, as well as to encourage increased investment in housing through a tax credit on income earned from residential mortgages. --The Administration's proposed Housing Act which would ease the present tight mortgage credit situation and make home ownership easier in the long term by: --Authorizing increases in the permissible mortgage amounts eligible for FHA insurance. Permitting home buyers to pay market interest rates on FHA and VA insured mortgages, and reducing the cost of buying a home by doing away with the present system of charging points on mortgage loans. --Authorizing on an experimental basis more flexible repayment plans on FHA insured mortgages. --Authorizing more flexible interest rates, longer repayment terms and higher amounts for mobile homes and home improvement loans. This legislation would extend authority for extensive experiments with a new approach--direct cash assistance--for addressing the housing problem of low income American families. Despite the commitment of over $66 billion, evidence has clearly shown that the subsidized housing programs for low income families have not worked well. Instead of programs to treat symptoms, I will continue to press for a longer term solution-which goes to the root of the problem-lack of sufficient income--and which permits the private housing market to work in as efficient a way as possible. Additionally, this legislation would improve the operation of our existing public housing projects, by helping them move to a more effective, efficient and self-sufficient basis of operation. IMPROVING TRANSPORTATION The energy crisis has made urgent what once seemed only necessary: the building of a transportation system that permits all Americans to travel efficiently and at reasonable cost. While some elements of our transportation system--such as the Federal highway network--have been dramatically improved or expanded in the past decade, others--notably the railroads--have fallen into serious difficulties. It is also apparent that our public transit system must be greatly improved within our urban centers. The measures already taken and others which I shall propose this session are particularly important in helping to deal with the energy crisis by encouraging a more sensible utilization of our transportation resources. During the past four years, several key measures have helped lay the basis for a greatly improved transportation system. Under the Urban Mass Transportation Act of 1970, we increased annual Federal aid to urban public transportation to $I billion by 1973--8 times the level of 1968--and in 1973 another $3 billion was made available for the years immediately ahead. For the first time since World War II the downward trend in transit ridership has been reversed, and is now moving upwards. And for the first time, under the provisions of the Federal-Aid Highway Act of 1973, States and localities can now use a portion of their Federal highway funds for public transit purposes. There has also been improvement of rail passenger service under AMTRAK, a public corporation created by the Rail Passenger Service Act of 1970. After years of steady decline in rail passenger service, the past year saw a 14 percent increase in the number of passengers carried on AMTRAK. Just this past year, we also went to work to avoid a major rail crisis through passage of the Regional Rail Reorganization Act of 1973, which provides for the restructuring of the bankrupt railroads of the Northeast and Midwest region into a streamlined system. By 1976, we hope that the affected railroads will be able to operate profitably and can survive as producers, not consumers, of tax revenues. Significant new initiatives have also been taken in airport and airway development, making vitally needed improvements in the merchant marine, and in promoting transportation safety, especially on our Nation's highways. Clearly, however, there is still much to be done. It is my hope that 1974 will be the year when we make major advances by enacting two critical transportation bills. One of these proposals, which I will send to the Congress in the near future, would give our communities not only more money but also more freedom to balance their own transportation needs--and it will mark the largest Federal commitment ever to the improvement of public transportation. This bill would increase Federal assistance for metropolitan areas by nearly 50 percent over the level of fiscal year 1974. More than two-thirds of those funds would be allocated by formula to State and local governments and those governments could better determine their own transportation priorities, choosing between construction of highways or public transit systems, or the purchase of buses or rail cars. Additional transit aid would also be made available to rural communities for the first time. Under this bill resources would also be available for the first time to augment the operating funds for public transportation systems in both urban and rural areas. By permitting Federal resources to be used for operating purposes, this proposal should make it unnecessary to establish a new categorical grant program for transit operating subsidies, as is now contemplated in bills before the Congress. As a second major transportation initiative this year, I shall propose that we modernize the regulatory system governing railroad operations. This legislation would make it easier for railroads to consolidate service on a sustainable basis. It would make changes in the system of rate regulation to allow rail carriers to compete more effectively with one another and with alternative modes of freight transportation. Discriminatory State and local taxation of interstate carriers would be barred. It would also provide $2 billion in Federal loan guarantee authority to finance improvements in rights-of-way, terminal and rail plant facilities, and rolling stock, where necessary, which would be a major step in our effort to improve the Nation's railroad system. Additional transportation measures I shall soon propose will include: --Improvements in highway safety through the earmarking of approximately $250 million of the 1975 Federal highway program for the elimination of death traps from the highways--by, for example, improving high-hazard intersections and replacing dangerous bridges. New bonus grants to the States will also be initiated to encourage the adoption of improved safety legislation and to reward States for outstanding safety accomplishments. --A restructuring of the airport and airway financing system to allocate costs more equitably among the users of our airways and to provide more flexibility in the use of funds. DISTRICT OF COLUMBIA Last Christmas Eve, when I signed the new home rule bill into law, the Nation's Capital reached a significant milestone. If the voters of the District accept the proposal in the forthcoming referendum, the city will soon have its first elected mayor and city council in 100 years. In addition to giving the citizens of our Nation's Capital the right to elect their own officials and a greater role in decisions affecting local affairs, the act also transfers to the District functions now carried out in Federal agencies which should rightfully be under local control. In order to accomplish this transfer of responsibilities to the local government, much work will have to be done. This Administration will make every effort to assist in that transfer and to ensure that it is both timely and effective. While our attention to the affairs of the District of Columbia has been captured by the transition to home rule, we must not ignore another important task before us. As the city moves into a new era of self-government, it must also prepare for the Nation's celebration of the Bicentennial. A Federal Bicentennial Task Force has been working to ensure that the Federal Government meets its financial and program commitments in the Nation's Capital. Under the leadership of the Bicentennial Coordination Center, which I established over two years ago, a number of projects are moving forward. The National Visitors' Center, Constitution Gardens, the Eisenhower Civic Center, the Fort Circle Parks, the National Air and Space Museum and other projects will contribute enormously to the celebration which takes place here in 1976. In addition, the Pennsylvania Avenue Development Corporation will soon present its plan to restore and improve this central, historically important thoroughfare. During the coming year, I also urge the Congress to take action on pending legislation to create a District of Columbia Development Bank, which would do much to broaden the economic base of the District. THE BICENTENNIAL As we near the celebration of America's Bicentennial, which officially begins in March of 1975, the tempo of preparations has picked up. A sound organizational framework has now been established, with the approval by the Congress last year of a new American Revolution Bicentennial Administration. Each of the 50 States, the District of Columbia and the four territories has also established its own Bicentennial Commission to plan and coordinate local Bicentennial projects. Some 370 counties, cities, towns, villages and tribal units have been recognized as Bicentennial Communities, and some 600 applications for this designation are currently being reviewed. On the Federal level, I have created the Domestic Council Committee on the Bicentennial. This Cabinet-level Committee has approved the goals for Federal participation in the Bicentennial, established an Interagency Bicentennial Task Force, and approved over 200 Bicentennial projects of the Departments and agencies. The Department of the Interior will complete the development of historically significant National Park sites; the National Foundation on the Arts and the Humanities will support cultural activities relating to the Bicentennial; and many of our other national institutions, such as the Smithsonian Institution, will present special exhibitions across the Nation. Other nations are actively responding to the "Invitation to the World" that I issued on July 4, 1972 to participate with us in this celebration which is not ours alone, but one which draws on the heritage of every nation from which people have come to our shores. In celebrating America's Bicentennial, we shall, of course, commemorate our national achievements. We shall honor our celebrated leaders even as we remember those whose contributions were less well known. We shall take stock of our shortcomings and resolve to overcome them. What we will celebrate most of all in 1976 will be the vitality of the American people. We have tried to ensure that Federal Bicentennial activities reflect the diversity which is ours alone, and which is appearing in community Bicentennial planning across the country. CULTURE AND COMMUNICATIONS When I took office in 1969, I was determined to give support to the goal of substantially strengthening the arts and humanities in the United States. The result has been the rapid growth of the National Endowment for the Arts and the National Endowment for the Humanities-which had existed before but at a very low level of activity. In the current year, the National Endowment for the Arts will spend $60.8 million on a large scale of programs intended to enrich America's cultural present and future. A broad range of individuals as well as institutions, both public and private, are being assisted. And special support is being given to projects which will add to the celebration of our Bicentennial. The Congress has in the past given strong bipartisan support to the Arts Endowment. That same support will be needed in the future. Increased Federal funds, eliciting greater financial support from the private sector and State and local governments, will ensure the flourishing of American arts in the years ahead. The National Endowment for the Humanities has likewise made outstanding contributions to the stimulation of our intellectual and cultural life. One measure of the growing importance of its activities is the fact that the Humanities Endowment has a program today which is ten times as large as it was five years ago. The Humanities Endowment will also play a major role in promoting the Bicentennial and will emphasize activities which reach large numbers of people, such as film and television productions and traveling exhibitions. In America, television is by far the best means of communicating with the widest audience. To assure the American audience a greater range of television programming of a type not financially feasible for commercial television, we have dramatically increased our support for public television in the last five years. Public Broadcasting matured during the past year. Both the television and radio licensees reorganized themselves in a way which encouraged a more rational relationship between them and the Corporation for Public Broadcasting, and increased the ability of each local station to provide programs uniquely tailored to their local communities. Another aspect of electronic media that has recently become a public policy issue is cable television, a development that could lead to a vast expansion of the Nation's communications capabilities. In June of 1971, I established a Cabinet Committee to develop proposals for a comprehensive national policy on cable communications. I have recently received and am now reviewing the report which is the product of that committee. I have also asked the Director of Telecommunications Policy to prepare legislation to move toward the adoption and implementation of a national cable television policy and I expect to submit such legislation to the Congress in the near future. I encourage the Congress to review carefully the issues presented by cable television and I especially encourage a widespread national debate on this subject which could play such a major role in all of our lives during the future. SCIENCE AND TECHNOLOGY One of the great strengths of this Nation has been its preeminence in science and technology. In times of national peril we have turned to the men and women in the laboratories in universities, Government, and private industry to apply their knowledge to new challenges. Once again, in the current energy crisis, we are calling upon them to respond. I have outlined, in my recent energy message to the Congress, the first step in a five-year, $10 billion research and development effort in energy: $1.8 billion for direct energy R&D for the coming fiscal year and an additional $216 million for supporting research--a total increase of 80 percent over this year. A look at the broad scope of this energy effort tells a great deal about our confidence in the capabilities of the Nation's scientists and engineers. We are calling on them to accelerate the development of nuclear power systems, to determine how we can use our abundant supplies of coal in ways that are environmentally acceptable and to improve technology for harnessing natural energy sources such as the sun and the heat of the earth. At the same time, we are asking them to explore new ways of conserving the energy that we already use for everyday conveniences such as our automobiles. This Administration recognizes that the need for progress in every major area of American life requires technological input. We are therefore committed to giving all our major programs a broad scientific underpinning. The new budget will call for an increase of over 20 percent in civilian research and development expenditures. In addition to a major increase for energy, research and development funds will be spread across a large number of programs for enhancing the prosperity, well-being, and health of Americans. Science will continue to be vital to our efforts to fight drug abuse, to prevent infant mortality, to combat venereal disease, and to aid in treating mental illness. We will call upon the services of our scientists and engineers to design better forms of transportation, and to make safer the transportation we already have. We will examine ways of making our vast agricultural establishment yield more food at lower prices, and try to lessen agriculturally-related pollution. We will attempt to develop methods of mining that will not only yield greater mineral wealth but also give the miner greater safety and the landscape greater protection. We will study ways to protect our wildlife from natural and man-made attack, and we will attempt to learn how to protect ourselves from the violence of nature in the form of floods, landslides, earthquakes, tornadoes, and other natural calamities. This Administration recognizes the vital role which the social sciences must play in America's growth. Money will be made available for studying the social effects of various Government income distribution and redistribution plans, such as social security, welfare benefits, health insurance, and varied and experimental educational forms. In every great area of national endeavor, the Administration will see that adequate funds for making scientific progress are spent. That also means we will continue our important efforts in space. The exploration of space is today making a key contribution to man's understanding of his universe and to our abilities to manage our resources on earth wisely. As our Skylab astronauts have proven, space is now an acceptable working environment for man. While we explore our planetary system, the stars, and the galaxies, we are also using space technology to monitor the earth's environment. The Earth Resources Technology Satellite is allowing us to search for scarce resources from high above the earth. Already, many of our intercontinental communications are by satellite. This year new commercial satellites will also be used for domestic telephone, telegraph, and television services. Satellite weather forecasting is now commonplace as a result of our space efforts. Space exploration in the future should become more economical as we develop the Space Shuttle, a reusable vehicle for space transportation. A cooperative international aspect of the space program will come with the European developed Space-lab as an integral part of the Shuttle program. In addition, we are now moving full speed ahead with our plans for a joint space venture with the Soviets in 1975. THE NEW FEDERALISM Just as the rapidly changing and increasing demands placed upon Government have made it necessary to reorganize the Federal structure, they have made it even more imperative to make State and local government stronger and more effective. During the last four decades, almost every major attempt by the Government to meet a major social need has resulted in a new national program administered in Washington by a new bureaucracy. Forty years ago there were more than 600,000 Federal employees; today there are more than 2.7 million. In the last decade, this problem has grown acute. In 1960 there were some 200 Federal grant-in-aid programs with outlays of $8 billion, but by 1970 there were nearly 1,000 and the total outlays had risen to $22 billion. And in the next fiscal year we expect outlays for grant-in-aid programs to reach $52 billion, even after our substantial efforts to cut their number. This growth in size, power and complexity has made the Federal Government increasingly inaccessible to the individual citizen it seeks to help. Many of our new national social programs have actually impeded the development of effective local government. By creating a Federal categorical grant system of staggering complexity and diversity we have fostered at the State and local level: --Overlapping and wasteful programs; --Distorted budgets and priorities; --Additional administrative expense; --Delay and uncertainty; and --A diminution in the authority and responsibilities of State and local elected officials, as Federal grants have become the special province of competing bureaucracies. In one of the basic new directions of my Administration, I proposed in 1969 that we create a new and fundamentally different relationship between State and local government, on the one hand, and the Federal Government on the other. This new relationship has come to be known as the New Federalism. As I said in 1969, its purposes are: --To restore to the States proper rights and roles in the Federal system with a new emphasis on local responsiveness; --To provide both the encouragement and necessary resources for local and State officials to exercise leadership in solving their own problems; --To narrow the distance between people and the Government agencies dealing with their problems; --To restore strength and vigor to State and local governments where elected officials know best the needs and priorities of their own constituents; and --To shift the balance of political power away from Washington and back to the country and the people. With the help of both the Congress and the Administration, this new relationship among local, State and Federal governments has begun to take shape: --In 1972, the Congress enacted our General Revenue Sharing program, and already more than $11 billion of new money has been put to work in over 38,000 units of State and local government. --Funding through the Law Enforcement Assistance program has demonstrated the flexibility of the New Federalism in leaving to State and local authorities the decisions on how best to combat crime in their jurisdictions. This program has helped to make America's streets safer for our citizens. --The Comprehensive Employment and Training Act which I signed into law in 1973 is a landmark example of the New Federalism's broad and more flexible forms of assistance--and it represents a leading example of what can be achieved when the Executive and the Congress team up to enact solid legislation. --New authorities under the Rural Development Act are being exercised this year in a way which is supportive of State and local development plans and priorities. --In addition, within the limits of law, we have moved administratively to strengthen the role of State and local governments by simplifying and streamlining Federal grant systems--including procedures for State and local review of project proposals affecting their jurisdictions, opportunities for grant integration and joint funding, and the decentralization of many Federal activities to ten Federal Regional Councils. In the remaining three years of this term I shall continue to take every sound administrative action within the authorities available to me to support and strengthen State and local government, but we must have the support of the Congress to maintain the progress which has begun. Proposals for furthering the New Federalism now before this body and for which I urge your support include: --Federal education reforms to consolidate support for elementary and secondary schools as well as vocational and adult programs, and to promote better planning on the local level through advance funding. --The Better Communities Act, to replace several ineffective and restrictive urban programs with a flexible approach that would allow local officials to make essential decisions on the way community development funds would be spent. --The Responsive Governments Act, to provide needed Federal assistance for improving State and local planning, decision-making and management capabilities. This would help to strengthen the capacity of State and local governments to assume greater responsibility for the administration of their own programs, whether federally assisted or not. --The Disaster Preparedness Act, to increase the role of State and local officials in allocating Federal disaster funds and to cut the tangle of Federal red tape. In addition to these proposals now pending, a number of the new initiatives that I describe elsewhere in this message also reflect the principles of New Federalism. These include: --A new public transportation initiative that would permit States and localities-both urban and rural--to allocate highway and mass transit funds in accordance with local conditions and priorities. --An economic adjustment assistance program, that would help States and communities to create employment opportunities where they have been affected by structural changes in their economies which has brought about persistent unemployment or depressed incomes. --In the field of health, a comprehensive health insurance plan which would bring protection against medical expenses within the reach of all our citizens. MAKING GOVERNMENT WORK BETTER On taking office five years ago, one of the first needs I sought to address was the organization of the executive branch of Government--for the plain fact is that the only way Government gets anything done is through its organizational structure, and how well it can perform depends in large measure on how well it is organized. Because the needs of the Nation continue to change, and because the activities of Government must respond to those changes, the patterns of Government organization that might have been fine in the 1930s or even in the 1960s, may be hopelessly out of date in the 1970s. Therefore, early in my first term I established an expert commission to survey the organization of the executive branch and to recommend improvements to meet present-day needs. The reports of this commission contributed significantly to the reorganizations that I ordered and that I recommended, including the proposal I put forward three years ago for a sweeping reorganization of the executive branch, consolidating seven of the present Cabinet departments into four new units. Although this basic restructuring has not been enacted by the Congress, other progress of a substantial nature has been made in modernizing the Government. For example, we have established: --The United States Postal Service, taking the post office out of politics; --The Office of Management and Budget, providing a strong management arm to assist in coordinating the functions of the executive branch; --A restructured National Security Council; --The Domestic Council to coordinate domestic policy formulation; --The Council on Environmental Quality, the Environmental Protection Agency, and the National Oceanic and Atmospheric Administration, all to provide leadership in meeting our vital environmental needs; --The Special Action Office for Drug Abuse Prevention and the Drug Enforcement Administration; --The Council on Economic Policy, to facilitate the formation and execution of overall economic policy; --The Council on International Economic Policy, to focus on an area increasingly important both to our foreign relations and to our domestic economy; --ACTION, to provide stronger coordination and incentives for volunteer activities; --The Cost of Living Council, to help stabilize prices; and, --The Federal Disaster Assistance Administration, to help individuals and communities struck by natural disasters. Each of these reorganization steps was designed to meet a specific need more effectively, or to respond to newly urgent needs. Several were accomplished under the reorganization plan authority which has been available to every President in the last 25 years, but which expired last March. This authority--which is utilized only with the concurrence of the Congress-continues to be necessary in order to keep abreast of changing needs, and I urge that it be reinstituted. Of special concern today is the reorganization of the Government to meet the energy crisis. I have by Executive Order already established the Federal Energy Office to serve as a focal point for energy actions taken by the Government. But that office lacks a statutory base and does not have sufficient authority to do the full job. That is why I have asked the Congress to establish the Federal Energy Administration and I once again urge it to act on this matter. Recognizing that this country should no longer remain dependent upon foreign energy sources, I have also urged the creation of an Energy Research and Development Administration to develop the necessary technology to tap new domestic sources of energy and a separate Nuclear Energy Commission to carry on the regulatory activities presently assigned to the Atomic Energy Commission. While these organizational initiatives are needed now, the best organization to knit together the future energy and natural resource programs of the Federal Government would be a comprehensive Department of Energy and Natural Resources. This concept is consistent with the major Federal departmental reform I submitted to the Congress in 1871. Today, I again urge swift, favorable action by the Congress on this proposal so that we will have the broad organizational base that will ultimately be needed to meet many of our energy needs in the most effective manner and to balance energy and natural resource considerations in the future. That same consolidation and reorganization of the executive branch that I proposed in 1971 would also have created new departments for community development, human resources and economic affairs. The basic problems of fractionated, sometimes overlapping and often conflicting organizations that prompted these original proposals remain acute today. I therefore urge the Congress to join with me in a serious effort to achieve an effective reorganization in these areas. In view of the close relationship between food assistance programs and other income security programs, I will also propose new legislation to transfer the food stamp and related programs from the Department of Agriculture to the Department of Health, Education and Welfare. Another important organizational proposal still awaiting Congressional action is the creation of an independent Legal Service Corporation. My Administration will work closely with the Congress in the weeks ahead to obtain final passage of our proposal which would provide the poor with quality legal representation, would create an organization free from political pressures, and would include safeguards to ensure its responsible operation. Legal services legislation has already passed the House. I am hopeful that reasonable legal services legislation will now be passed by the Senate. A major new opportunity for better Federal management has been initiated at my direction by the Office of Management and Budget. Frequently termed "management by objective," it involves the identification of specific, high-priority objectives for each year for each of the departments and agencies. During the year, progress in reaching these objectives can be closely measured and reported to agency heads and to me. In the years ahead I expect this technique will help make the Government both more responsive and more accountable. Nothing is more important to improving the efficiency of our Government than the recruiting of top flight personnel for Federal jobs--including positions in the career civil service. We will be working in the months ahead to ensure that executive compensation, career development and training all attract and hold the best possible personnel in the public service. The compensation we provide our top officials is integral to these efforts to recruit and retain the best men and women for Government service. Salaries of Federal judges, Members of the Congress, and heads and assistant heads of executive agencies have not been adjusted for 5 years, during which time comparable pay rates in the private sector increased 30 percent and pay for other Federal employees has increased significantly. The report of the Commission on Executive, Legislative and Judicial Salaries notes that this lag in compensation also produces serious salary compression among the top ranks of career employees. I am therefore recommending a three-stage increase in executive, legislative and judicial salaries in the budget, at the rate of 7 1/2 percent annually for each of the next three years. This will make salaries within the top levels of the Federal Government more competitive with industry. And it will help us to make Government work better. CAMPAIGN REFORM For several years it has been clear that reforms were needed in the way we elect public officials. The intense public focus placed on the campaign abuses of 1972 has now generated sufficient support for this issue that we now have an opportunity to make a genuine breakthrough. In a national radio address on May 16 of last year, I announced my proposal for a non-partisan commission on campaign reform. This commission would have reexamined the entire Federal election process to come up with a comprehensive set of legislative recommendations. The Commission would have filed a public report no later than December 1, 1973. Eight months have now passed since that proposal was submitted to the Congress and the Commission is not even close to being created. If it had been created expeditiously, we would now have its report recommending meaningful reforms for Federal campaigns and as I had originally hoped, those reforms might be in place prior to the 1974 elections. In light of the delay, I have now decided to submit a comprehensive set of Administration proposals on campaign reform for consideration by the Congress during this session. While I do not believe mine will be the only workable proposals, I do hope they will lead to meaningful debate and reform in this critical area. To that end, I look forward to working with the Congress in a long-overdue effort to clean up the Federal election process. AMERICA AND THE WORLD When this Administration took office, it was apparent that the world had changed in fundamental ways, and that America's foreign policy had to change in equally fundamental ways. We needed to end our military involvement in the Vietnam war in a manner consistent with our responsibilities and commitments as a major world power. We needed to adjust to the changes in the strategic situation between the Soviet Union and the United States which presented a unique opportunity to build a solid foundation for peace but which also threatened our own security if that foundation could not be built. We needed to end a quarter century of hostile isolation which had kept one-fourth of the world's population outside the framework of international cooperation. The world could not afford another generation of hostility between the United States and the People's Republic of China. We needed to adjust our partnerships with Western Europe and Japan, recognizing their increasing political and economic strength and self-reliance, and emphasizing our important common goals. We needed to alter the world monetary system to reflect the new realities of the international economic system and America's place in it. During the past five years we have made striking progress in meeting each of these needs. CONTINUING RESPONSIBILITY IN VIETNAM The United States is at peace for the first time in more than a decade. But peace must be something more than the absence of the active engagement of American forces in conflict. We must guard against the tendency to express relief at our military extrication from Southeast Asia by "washing our hands" of the whole affair. Men and women are still dying there. We still have a responsibility there. We must provide those ravaged lands with the economic assistance needed to stabilize the structures of their societies and make future peace more likely. We must provide, as well, the continued military aid grants required to maintain strong, self-reliant defense forces. And we will continue to insist on full compliance with the terms of the agreements reached in Paris, including a full accounting of all of our men missing in Southeast Asia. BUILDING NEW RELATIONSHIPS As we work through detente to reduce conflict in areas of the world where both we and the Soviet Union have important interests, we must also continue to work to reduce the potential causes of conflict between us. We must persevere in our negotiations with the Soviet Union to place further limits on strategic arms competition and in our talks with the Warsaw Pact nations to reduce forces in Europe in a way that will increase security and stability for all. We will pursue our relations with the Soviet Union in the climate of detente established two years ago in Moscow and reaffirmed by General Secretary Brezhnev's visit to Washington last year. During the fateful weeks of the Middle East war last October, the strength of our detente was severely tested. Since then, American diplomatic leadership and initiative have played a central role in the search for a final settlement in the long troubled Middle East. This began with the cease-fire of October 22, worked out with the Soviet Union's assistance, and was later strengthened by the Six-Point Agreement in November to consolidate the cease-fire, then by the Geneva Peace Conference--under the co-sponsorship of the United States and the Soviet Union-and most recently by the agreement on the disengagement of Egyptian and Israeli military forces, which is being implemented in cooperation with the United Nations Emergency Force. These steps are but the beginning of broadened efforts to find a lasting settlement of the area's problems. The process of building a normal relationship with the People's Republic of China continues. Liaison offices have been established in our respective capitals and there continues to be fruitful contact between our governments at very high levels. STRENGTHENING OUR FREE WORLD PARTNERSHIPS As our relationships with old adversaries are changing, so are our relationships with old friends. Western Europe and Japan have put behind them the postwar struggle to rebuild their economies, re-order their societies and re-establish their political force. Their success in these endeavors is something we helped to foster and in which we can take pride. But now times have changed and our past role in their success cannot be the sole basis for a continuing relationship. We must instead adjust our relationships to recognize their new economic capacities and their international political objectives. We must accommodate all of these within the framework of the friendship and goodwill of our allies and our whole past history of cooperation in the pursuit of our common goals. This is a cornerstone of the structure of peace we are seeking to build. With our closest neighbors, here in the Western Hemisphere, we shall continue to seek additional ways of working cooperatively to solve the problems which face the Americas. Secretary of State Kissinger will be meeting in a few weeks with the foreign ministers of Latin America to begin a new and constructive dialogue in the family of American states. INTERNATIONAL TRADE AND COMMERCE As we turn from an era of confrontation to one of cooperation, trade and commerce become more important. We have moved from a position of virtual economic hegemony in the world to a new role in a more interdependent world economy. We must create an equitable and efficient system of integrating our own economy with that of the rest of the world. Much has already been accomplished on this front. The markets of the USSR and China are now accessible, thereby providing jobs for American workers. Our major trading partners in Western Europe and Japan share our interest in further reducing international trade barriers and increasing world trade. The rigid and outmoded international monetary system which over-valued the dollar and impeded our foreign trade has been decisively altered. After two years of trade deficits, America achieved a trade surplus in 1973. But we must persevere in our international monetary, investment and trade negotiations. The greatest tasks still lie ahead and the stakes are high. Avoiding the economic and political disruptions associated with international monetary turmoil and restrictive trade and investment practices increases in importance as international interdependence grows. As I noted earlier in this message, prompt passage of the pending Trade Reform Act is essential to achieving the goal of a less restrictive and more equitable international economic system. In addition, we must move forward with the current negotiations to reform the international payments system under the auspices of the International Monetary Fund, reforms which will markedly increase the opportunities for nations to trade and invest profitably. We must also strengthen our resolve as the world's most prosperous nation to help less fortunate countries. In the world of today, no nation will be fully secure or prosperous until all nations are. As in the past, we will take pride in our efforts to work with developing nations which aspire to greater economic and social well-being. The United States has called for the World Food Conference which will be held in November under the auspices of the United Nations. We will also actively observe 1974 as World Population Year, as proclaimed by the United Nations. MAINTAINING A STRONG DEFENSE FORGE But as we work for .peace, we must be conscious that the opportunity to build a structure of peace came because our arms have served as a deterrent to war. We must maintain that deterrent. In the last five years, outlays for the Department of Defense have been reduced by about 1/3--measured in constant dollars--and military personnel have been cut from 3.5 million to 2.2 million. This year, I will recommend a substantial increase in the 1975 budget for the Department of Defense. These increases are necessary to improve the readiness of our armed forces, to build up levels of essential equipment and supplies and to preserve Present force levels in the face of rising costs. CONCLUSION Throughout these five years, I have had one overriding aim: to establish a structure of peace in the world that can free future generations from the scourge of war. Others may have different priorities; this has been and will remain my first priority, the chief legacy that I hope to leave from the eight years of my Presidency. As we strengthen the peace, we must also continue each year a steady strengthening of our society here at home. Our conscience requires it. Our interests require it. We must insist on it. As we create more jobs, as we build a better health care system, and improve education; as we develop new sources of energy, as we provide more abundantly for the elderly and the poor, as we strengthen the system of private enterprise that produces our prosperity--as we do all this and more, we solidify those essential bonds that hold us together as a Nation. Even more importantly, we advance what in the final analysis government in America is all about; more freedom, more security, a better life, for each one of the 211 million individual persons who are America. We cannot afford to neglect progress at home while pursuing peace abroad. But neither can we afford to neglect peace abroad while pursuing progress at home. With a stable peace, all is possible; without peace, nothing is possible. Earlier in this message, I comment that "one of the continuing challenges facing us in the legislative process is that of the timing and pacing of our initiatives . . . selecting each year among many worthy projects those that are ripe for action at that time . . ." What is true in terms of our domestic initiatives is true also in the world. This period we now are in--these few years-presents a juncture of historic forces unique in this century, which provide an opportunity we may never have again to create a structure of peace solid enough to last a lifetime and more--not just peace in our time but peace in our children's time as well. It is on the way we respond to this opportunity, more than anything else, that history will judge whether we in America have met our responsibility. I have full confidence that we will meet that responsibility. RICHARD NIXON The White House, January 30, 1974.
we enter 1974 not at the beginning of an historical cycle but in the middle of one beginnings have been made in many vital areas beginnings which we now must build upon new needs have arisen which we are in the process of addressing opportunities are coalescing which give us a chance to make historic progress toward a stable peace and expanding prosperity in looking at the agenda for 1974 we can not consider the work of this or of any one year in isolation what we select as our tasks in 1974 must build on the work of the years before and anticipate needs of those ahead indeed one of the continuing challenges facing us in the legislative process is that of the timing and pacing of our initiatives it would be as false to pretend that we could do or afford to do everything at once as it would be to maintain that we can do nothing therefore we must strive to maintain steady progress selecting each year among many worthy projects those that are ripe for action at that time and that can be accommodated within the constraints of our budget but pressing to ensure that the most that can be done is clone in discussing my legislative recommendations for this congressional session therefore i shall do so in the context of the advances that have already been made the problems that remain and the special opportunities we have in 1974 to make further progress i have started with certain basic premises the basic tax burden on the american taxpayer should not be increased our new initiatives therefore should be scaled to what can prudently be spent given the level of revenues that would be generated by the existing tax structure at full utilization of our resources increases in federal spending should be kept to a minimum but the budget should be flexible enough to be used if necessary to maintain jobs and prosperity it is essential that we break the old habit of regarding any federal program once established as permanent we must learn to scrap old programs that are no longer effective or needed in favor of new ones that are this is the only way we can afford to do what must be done within these guidelines there are a number of major new initiatives which are ripe for action in 1974 several of which can be milestones on our march to a life of greater freedom greater opportunity and greater prosperity for all in particular 1974 can be the year in which first we not only break the back of the energy crisis but also through project independence lay the foundation for our future capacity to meet america energy needs from america own resources at reasonable prices and with adequate environmental protection second we take another giant stride toward lasting peace in the world not only by continuing our policy of negotiation rather than confrontation where the great powers are concerned but also by helping toward the achievement of a just and lasting settlement in the middle east third we will check the rise in prices without administering the harsh medicine of recession and move the economy into a period of steady growth at a sustainable level fourth we establish a new system of comprehensive health insurance that makes high quality health care available to every american in a dignified manner and at a price he or she can afford fifth we continue to build a new era of achievement and responsiveness in state and local government by cutting the strings of too tight federal control that have bound the hands of state and local officials in community and economic development programs sixth we make a crucial breakthrough toward better transportation by strengthening the ability of local communities to deal with their transportation problems seventh we reform our system of federal aid to education to provide it when it is needed where it is needed and so that it will do the most for those who need it most eighth we make an historic beginning on the task of defining and protecting the right of personal privacy ninth we start on a new road toward reform of a welfare system that bleeds the taxpayer corrodes the community and demeans those it is meant to assist and tenth together with the other nations of the world we establish the economic framework within which americans will share more fully in an expanding world trade and prosperity in the years ahead with more open access to both markets and supplies meeting our energy needs at the start of this congressional session the number one legislative concern must be the energy crisis the cooperative efforts of the american people together with measures already taken by the administration have significantly reduced the immediate impact of the energy crisis there has been some economic dislocation and some individual hardships but these have been minimized by our policy of encouraging broad conservation measures and allocating scarce energy resources so as to do the least possible harm to jobs and the economy the object has been to keep our farms and factories producing to keep our workers on the job and to keep our goods and services flowing even if this means that we must live and work in somewhat less comfortable surroundings and drive fewer miles at slower speeds even with the full cooperation of most americans however we will still face real challenges and genuine shortages in the months and years immediately ahead to meet these challenges we must change our patterns of energy consumption and production we must press forward with the development of reliable new energy sources and we must adjust to the fact that the age of unlimited supplies of cheap energy is ended the immediate energy crisis began with the oil embargo imposed in the middle east last fall but the embargo only hastened a shortage that was already anticipated for a number of years our fuel consumption had been climbing while our production of domestic energy supplies declined we became more and more heavily dependent on oil imports and consequently more vulnerable to any interruption or reduction in those imports as well as to sudden increases in foreign prices today we have an interruption in supplies and we face sharply increased prices for those supplies when they are restored irrespective of the possibility of restoring the flow of middle east oil we must act now to ensure that we are never again dependent on foreign sources of supply for our energy needs we must continue to slow the rise in our rate of consumption and we must sharply increase our domestic production the effects of energy conservation can be felt at once already the responsiveness of the american people to the recent crisis has proved to be the major factor in helping to avoid the serious consequences that the winter might have brought that conservation must continue the required increase in domestic supplies can not be achieved so rapidly it will involve the development of entirely new sources of energy as well as the expanded development of oil and coal resources it will require a significant expansion of our research and development efforts it will require a shift from the use of scarce fuels to those which are more plentiful but also more expensive than the cheap energy to which we have been accustomed it will require that we encourage both exploration and production it will mean that as we act to prevent the energy industry from making unconscionable windfall profits we must also avoid crippling that industry with punitive legislation and finally it will require that we make some difficult decisions as we sort out our economic and environmental priorities as we seek to act domestically to increase fuel supplies we will act internationally in an effort to obtain oil at reasonable prices unreasonable increases in the cost of so vital a commodity as oil poses a threat to the entire structure of international economic relations not only jobs prices and incomes are at stake but the general pattern of international cooperation is at stake as well it is our hope that we can work out cooperative efforts with our friends abroad so that we eau all meet our energy needs without disrupting our economies and without disrupting our economic relationships last week i sent to the congress a comprehensive special message setting forth our energy situation our energy prospects our energy needs and the legislative measures i consider necessary for meeting those needs i shall not repeat that analysis nor the full list of those recommendations today i do want to urge however that the critical energy measures which i have proposed be made the first order of legislative business in this session of the congress and that work go forward expeditiously on the others those measures which i request be given the highest priority are the following a special energy act which would permit additional restrictions on energy consumption and would postpone temporarily certain clean air act requirements for power plants and automotive emissions a windfall profits tax which would prevent private profiteering at the expense of public sacrifice unemployment insurance for people in areas impacted by serious economic dislocation and mandatory reporting by major energy companies on their inventories their production and their reserves i am also asking that the congress quickly establish the federal energy administration and the energy research and development administration to provide the appropriate organizational structure for administering the national energy policy as we work toward the establishment of a department of energy and natural resources the 13 other energy measures i requested last week deal with needs extending beyond the present emergency but these also require expeditious action if we are to achieve the goal of project independence a capacity for energy by 1980 the success of project independence is essential to the continued strength of our position in world trade and also to our independence of action as a great power i hope that our joint efforts now to resolve the energy crisis and to move toward a capacity for in energy will enable the president who addresses the 98th congress a decade from now to look back and say we made it possible for america to enjoy continued peace and prosperity in the 1980s the nation economy the world economy during the past three years the united states has reached an unprecedented level of material prosperity industrial output has set new records trade has flourished consumption has risen to the highest levels in history even our inflation most serious economic problem we now face has been one of the lowest in the industrialized free world the major policy decisions we took in 1971 contributed significantly to this prosperity both here and in other countries it was clear for example as we moved into the 1970s that the international monetary system adopted after world war ii needed major adjustments unsustainable imbalances had developed threatening a resurgence of protectionism and a disruption of world trade this is why i decided to take some very strong measures in august of 1971 measures that have resulted in a major realignment of world currency values progress toward new and more flexible international monetary management and negotiations toward a more open and equitable trading system these adjustments while essential were not easy but now we have finally entered into a more flexible and realistic international financial system much remains to be done to complete the transition but its beneficial results are already clear the realignment of currency values helped produce an increase of 80 percent or more than 50 billion in the rate of exports during the past two years along with a major improvement in our trade balance this improvement was good not only for us but also for the rest of the world in addition the shocks to the world economy arising from reduced food supplies in 1972 and 1973 and in recent months from the oil embargo and the arbitrary increases in the price of oil all were managed without panic under the new arrangements indeed world trade has continued to expand despite these temporary difficulties international trade barriers a vigorous international trade is vital to the american economy jobs for american workers depend on our ability to develop foreign markets moreover american consumers deserve access to products that might be less expensive or more interesting or unavailable in the united states but if trade is to be advantageous over the long run it must be conducted on a basis which is fair to all participants there are still many unnecessary barriers to trade which need to be lowered or removed while improvements have been made in this situation during the last 10 years we need now to build on this progress and to negotiate for more open access both to markets and supplies this is why i call upon the congress with special urgency to complete action on my proposed trade reform act in order to provide the authority we will need to negotiate effectively for reductions in barriers to trade to improve the trading system and to manage trade problems at home more effectively as the senate considers this legislation i would draw its attention particularly to provisions added in the house which would seriously impede our efforts to achieve more harmonious international relationships these provisions would effectively prevent both the extension of nondiscriminatory tariff treatment and of credits to certain communist countries unless they followed a policy which allowed unrestricted emigration i am convinced that such a prohibition would only make more difficult the kind of cooperative effort between the united states and other governments which is necessary if we are to work together for peace in the middle east and throughout the world i am confident that by working with the congress we can find a solution to this problem that will avoid a major setback in our peacemaking efforts at the same time we must move forward with current negotiations to reform the international payments system under the auspices of the international monetary fund these negotiations are designed to increase the opportunities for all nations to trade and invest profitably the has already presented proposals for deterring the growth of significant imbalances in international monetary affairs while preserving for each nation a wide freedom in choosing how necessary adjustments can best be accomplished in addition the system will also have to accommodate the increased payments flow and prospective reserve accumulations occasioned by higher oil prices if however other nations share with us the will to preserve a healthy and growing world economy i am confident that a mutually acceptable solution to this problem will be achieved in practice this means that our markets must increasingly be open to imports from developing countries a condition that would be significantly facilitated by enactment of the trade reform act it also means that the congress must continue to authorize and appropriate our fair share of both bilateral and multilateral economic assistance including a substantial contribution to the international development association which helps the poorest countries in 1973 we successfully negotiated a reduction of the united states share from 40 percent to of ida funds we can not let the action of the house in voting against ida stand as our final answer we will work hard with the congress to ensure that this country continues to play a leadership role consistent with our own economic situation so that economic development can continue to be planned in an orderly manner along with trade and monetary problems new international agreements on investment policies and new mechanisms for dispute settlement are high on our negotiating agenda for the coming year we must continue to work for economic arrangements which permit the beneficial flow of international investment so that all may derive the maximum benefit from their own resources to that end i am glad to be able to note that this week the united states completed the phaseout of controls on flows of capital from this country the recent oil embargo and especially arbitrary increases in the price of oil have created major economic problems for many countries including the united states if continued these policies would require enormous transfers of goods and assets from oil importing nations transfers which would represent a serious burden for even the wealthiest countries and which would be virtually unbearable for the less developed countries our objectives are clear we must get world oil prices down from levels that are arbitrary and exploitative we must also cooperate to ensure that the international and domestic economic policies of the advanced countries do not compound the economic disturbances created by the current emergency but rather that we do all that can be done to contain and limit those disturbances the domestic economy despite our general prosperity inflation remains a most serious economic problem not only in the united states but also for the rest of the world we see clear evidence of this problem at every hand world oil prices have gone up recently at dramatic rates world food metals and other commodities prices are also up sharply because domestic prices can not be isolated from international prices worldwide inflationary pressures have helped to drive up prices here at home inflation has been a continuous problem for nearly a decade and it got worse in 1973 the result has been that people have come to expect continuing price increases and to behave accordingly in their own economic life their behavior in turn adds further to inflationary pressures contributing to a vicious inflationary spiral which is difficult to break some people have said that the best way to wring these inflationary expectations out of our economy is by taking the economy into a recession i disagree it is true that a lower level of economic activity would reduce demand and thus lower the pressure for higher prices however the cost of such a policy in terms of increased unemployment would simply be unacceptable by the same token i also reject the notion that we should totally ignore inflation and concentrate solely on stimulating higher levels of employment this policy would also involve too high a cost since it would unleash a further acceleration of the inflation rate in developing my economic policy for 1974 i have chosen what i believe is a sound middle road to cushion the economic slowdown we expect during 1974 without providing additional stimulus for inflation we expect this policy to reduce the rate of inflation by the end of the year should there appear to be a serious threat of a severe slowdown then we will act promptly and vigorously to support the economy as we cope with the challenge of inflation we must recognize the clear lesson of recent years while direct controls over prices and wages can help fight inflation in the they have a very limited useful life inevitably their eventual effect is to create or aggravate significant distortions in production and distribution accordingly i will continue to watch the situation closely and to pursue a policy of gradual selective decontrol except in particularly troublesome areas at the same time those federal programs that will help reduce inflation by increasing the supply of scarce resources will be strengthened one key area where we can look forward to expanded supplies is that of food with a new national farm policy that encourages rather than discourages output we achieved a record harvest in 1973 and another record harvest now appears likely in 1974 increased agricultural output is the only sure way to bring food prices down and increased output is what our new policies are producing rapid inflation is not inevitable and it must not be tolerated to regain control of inflation however will require patience and persistence over the long course my administration is dedicated to achieving this objective and we are confident that with the help of the american people we will succeed another most pressing economic a major contributor to the energy crisis as the cost of using our own fuel resources came to exceed the cost of imports in the 1960 it became increasingly attractive for us to import oil and petroleum products unfortunately our growing dependence on imports made our entire economy more vulnerable to outside forces that vulnerability has been tested in recent months as has the even greater vulnerability of the developed countries of western europe and japan and the less developed countries which have no oil every american has learned the consequences of this vulnerability short fuel supplies and higher fuel prices to a large extent our flexible adaptable economy will solve the longer run energy problem through the normal workings of the marketplace as energy prices reach somewhat higher levels than the bargain rates of the past conservation will be encouraged while domestic energy production will be expanded one example of normal market forces at work has been the recent shift to smaller cars with better gas mileage over the next few years we can also expect to see an expansion of coal production and new output of oil and natural gas nevertheless we will still have to import some of the oil we will need in the immediate future it is essential therefore that we seek a more reasonable price for oil in the world market it is also imperative that we review our current and prospective supplies of other basic commodities i have therefore directed that a comprehensive report and policy analysis be made concerning this crucial matter so that governmental actions can properly anticipate and help avoid other damaging shortages even with the inflation and energy problems 1973 was a year of many important economic gains for american people first employment in 1973 increased by million persons this percent rise in employment was the largest since 1955 new job opportunities greatly benefitted all categories of workers including women teenagers and vietnam veterans unemployment reached low levels especially for skilled workers second the purchasing power of the american people reached new highs last year even after allowing for price increases people are now consuming more goods and services than they did a year ago or in any other year in the entire history of the united states not everyone is purchasing power went up of course inflation took its toll on many families whose income did not rise as fast as that of the average american it is for this reason that we continue to regard inflation as a very serious enemy at the same time however we should not ignore the substantial economic gains that have been made perspective on 1974 we have known for some time that a slowdown in economic growth is inevitable in 1974 it has been clear that our economy has simply been growing at an unsustainable rate shortages of skilled workers full utilization of plant and equipment in key industries and short supplies of a number of essential raw materials have all provided clear indications that our rate of growth would have to taper off unfortunately the very mild slowdown which we anticipated for 1974 now threatens to be somewhat more pronounced because of the oil embargo the resulting shortages and the oil price increase we expect therefore that during the early part of this year output will rise little if at all unemployment will rise somewhat and inflation will be high our objective however is to turn this situation around so that later in the year output will be rising more rapidly while unemployment will stop rising and will then decline and the rate of inflation will slow role of the federal budget the budget that i will recommend to the congress next week will help us achieve our goals for this period it will support the economy resisting a major slowdown but it will not provide a degree of stimulation that could accelerate inflation if future events suggest that a change in fiscal policy is desirable i will promptly recommend the appropriate changes in particular i will not hesitate to use the stimulus of fiscal policy if it becomes necessary to preserve jobs in the face of an unexpected slackening in economic activity for fiscal year 1975 my budget recommends total spending of billion an increase of billion over the current year the increase is being held to the minimum level necessary nearly 90 percent of the increase is unavoidable under existing law the budgeted increase in relatively controllable outlays is only percent federal receipts should reach 295 billion during fiscal year 1975 an increase of 25 billion the projected budget deficit is billion under conditions of full employment however federal receipts would be substantially higher and there would instead be a moderate budget surplus the federal budget remains an essential tool in the fight against inflation with the energy supply limitations we are experiencing and the price pressures they create budget discipline is still required i have noted with satisfaction that most members of the congress have also recognized the need for budgetary discipline and that work is going forward to establish a more systematic budgeting procedure the congress devoted considerable effort in 1973 to developing a mechanism for coordinating its individual spending decisions with the budget as a whole i continue to support this effort although i have been troubled by some of the extraneous amendments which have been added to some of the measures for achieving this goal i urge the congress to enact workable budget reform in this legislative session tax reform our entire economy is affected by the incentives for investments that are embodied in our tax laws major steps have been taken to reform our tax laws in the past five years but much remains to be done since 1969 primarily through the tax reform act of 1969 and the revenue act of 1971 major changes have been introduced to make the personal income tax system conform more nearly to contemporary standards of fairness both the higher level of personal exemptions and the low income allowance have worked to free more than eight million low income families from their entire federal income tax burden the difference in the tax liability for single and married taxpayers has also been reduced as a result of these and other tax changes individual income taxes will be about 25 billion less in 1974 than they would have been under the old tax laws the saving in the tax burden for a typical family will be more than 270 or the equivalent of two weekly paychecks for the average worker i look forward to working with the congress during the next few months not only to simplify our tax laws themselves but also to simplify the tax forms that individuals fill out and to distribute the income tax burden more equitably last april the secretary of the treasury presented to the congress a set of administration proposals for major and fundamental tax reform included in these proposals were the establishment of a minimum taxable income so that no one could avoid paying a fair share of the tax burden the establishment of new rules for taxing income from foreign sources and also a limitation on artificial accounting losses to eliminate tax shelters i urge the congress to consider the administration tax reform proposals early in the year i have also been concerned about the excessive burdens imposed on our low income elderly families by state and local property taxes to deal with this problem i have proposed a refundable tax credit for those low income elderly persons whose property taxes exceed five percent of their income the proposal would also provide equivalent relief for the low income elderly individual who pays rent i again urge the congress to enact this very important proposal financial reform the health of our economy depends upon an efficient and flexible private financial system commercial banks thrift institutions credit unions and a host of other institutions and individuals that comprise the financial sector of our economy the average family depends on these institutions both to provide a fair and reliable return on its savings and to provide credit on reasonable terms when needed to buy homes automobiles and other purchases there have been occasions recently when this financial system has not worked as well as it should occasions for example when mortgage lending has been very difficult to obtain in large part these problems have been the result of legislation regulations and institutional arrangements which were suited to an earlier time but which are now obsolete to remedy this problem i submitted draft legislation last year which reflected the results of careful study by a presidential commission and government experts i again urge the congress to act promptly on this matter so that american families businessmen and local governments can be served by a financial system suited to the economic conditions of the 1970s the administration is also studying the competitive position of foreign banks within this country and of american banks abroad to make sure that discriminatory regulations do not prevent american banks and other financial institutions from doing business they are entitled to do i will be following the results of this study with considerable interest and will submit to the congress any proposals resulting from the study which seem desirable a healthy agricultural economy abundance is the primary goal of our farm policy abundance that can guarantee lower food prices for every american and higher incomes for all american farmers five years ago agriculture was a troubled industry government controls were reducing incentives for production and costing the taxpayers over 3 billion a year in farm subsidies designed to hold down production farm income was low billion and the long hours worked by farmers earned them an average income that was 26 percent below the nonfarm average farm families had been leaving the farm at an average rate of over a year today that picture has been dramatically altered farm markets have expanded dramatically farm exports have set new records in each of the last four years becoming the largest single factor in the nation balance of payments and strengthening the dollar in international money markets farm production has reached new record levels in each of the last three years and a new record harvest should be forthcoming in 1974 the billions of tax dollars which used to go for farm price support payments for basic commodities every year will be reduced to nearly zero farm income has reached record levels by 1973 the gap between farm income and nonfarm income had closed from 26 to 7 percent net farm income was up from billion to billion we are making this progress not through more government regulation but less one of the proudest achievements of this administration was the enactment of the agriculture and consumer protection act of 1973 which places production decisions where they belong with farmers not with the government a primary challenge for federal agricultural policies now is to encourage greater production of agricultural will mean more income for the farmer greater international trading benefits for the nation and reasonable food prices for the consumer i am therefore asking the congress to revamp the programs which still require restrictive federal control over the production of some remaining farm commodities especially rice peanuts tobacco sugar and extra long staple cotton to further enhance agricultural activity the administration will also promote soil and water conservation practices consolidate the locations of local offices of federal agricultural the agricultural stabilization and conservation service the soil conservation service the farmers home administration and the federal crop insurance corporation creating agricultural service centers on the local level to make things easier for the farmer and less costly for the government place high priority on directing agricultural research into those areas which will assure plentiful agricultural goods at reasonable prices maintain our competitive advantage in world agricultural production and protect the land at my direction secretary kissinger recently proposed to the united nations that it convene a world food conference a concern made urgent by acute food shortages in many parts of the world this conference to be held in november of 1974 should prove of particular importance to the american farmer whose extraordinary productivity has made this nation the world leading food exporter and whose own prosperity will continue to increase as we help to meet the needs of a hungry world our farm policy must of course address not only the needs of the farmer but also those of the consumer during 1973 we experienced a period of rapidly increasing food prices those prices leveled off in late 1973 but now we appear to be heading into a period of increasing food prices for at least the next few months it is our intention to hold these increases to the smallest possible rate through executive actions such as lifting the quota on wheat imports an action that i took last week but the most significant force in the battle against higher food prices is higher production this summer and fall the large 1974 harvest should be coming on the market serving as the best possible damper on higher prices economic security one of the most significant legislative achievements of 1973 was the enactment of the comprehensive employment and training act ceta a form of manpower revenue sharing this bill transfers from the federal government to states and localities significant control over the design and operation of programs to improve the employability of the unemployed and the underemployed ceta is a landmark of the new federalism it is also a landmark on the way to better manpower programs under this legislation state and local governments will be able to use federal funds to meet needs and to devote special attention to employment problems with particular local for example those that might arise in certain areas as a result of the present energy shortage in my new budget i am including an additional 250 million for ceta in the current fiscal year and 350 million in the year beginning july i for distribution to areas with high unemployment overall i am requesting more than 2 billion to fund our training and employment programs in the coming year other proposals related to economic security that i made to the congress last year and on which i again urge action include the establishment of minimum vesting funding and fiduciary standards for private pension programs so that workers could have greater assurance of receiving the pensions they expect and deserve when they retire i urge that we work together to resolve speedily the remaining disagreements and to enact responsible legislation which increases employee protection without burdening employers to such an extent that existing plans are jeopardized or new ones discouraged extension to state and local governments of the law forbidding employment discrimination against older workers improvement of the unemployment insurance program in several ways by increasing the state limits that keep some unemployed workers from receiving a reasonable proportion of their normal wage by extending coverage to farmworkers and by prohibiting payment of benefits to strikers while assuring benefits to unemployed as a result of a strike these general improvements in unemployment insurance should be augmented by a special extension of present benefits for those specific areas of the country which experience particularly high levels of unemployment over the next 12 months in addition basic coverage should be provided for those in these areas who do not at present have any unemployment insurance i will submit special legislation to achieve this purpose i also continue to support legislation to raise the minimum wage higher prices have eroded the purchasing power of workers receiving the current minimum wage but we must be careful to guard against enacting a bill which includes sharp increases or coverage extensions that would keep low income workers from being employed or a bill with a minimum wage for youths so high that we unwittingly deny them jobs finally we must attack one of the most troublesome problems faced by both rural and urban areas the existence of persistent and often severe unemployment or low incomes in areas whose character has been altered by changes in our economy and technology within the next several weeks i will propose an economic adjustment assistance program to help states and communities in overcoming problems caused by structural changes in their economies this program would replace the present economic development administration and the regional action planning commissions after a period of orderly transition income security one measure of a nation character is the respect it accords to its elderly another is the way it helps those in need we can be proud of the efforts we have made but it is time to reassess where we are and what direction we should take in the future we can take pride in the fact that cash benefits under social security have risen from 26 billion in fiscal year 1969 to 63 billion in fiscal year 1975 primarily as the result of five benefit increases totaling almost 70 percent and reaching 19 million persons a program of supplemental security income has been initiated and will soon be providing benefits to more than 5 million of the aged blind and disabled on a uniform nationwide basis in a way that respects their dignity but our income security programs need more than improved benefits over the past years a multitude of federally funded programs has grown up whose primary purpose is income security for those in need each of these efforts reflects a humane attempt to respond to a worthy goal however as cash and service programs have rapidly expanded in the past few years two things have become painfully clear first the result is an extremely costly set of generally unrelated uncoordinated programs with many unintended and undesirable consequences and second these efforts neither efficiently nor equitably accomplish the overall objective of assisting lower income families and individuals to achieve greater economic independence the fact that a third of the new federal budget 100 billion will be spent on income security programs in fiscal year 1975 compared to the 38 billion or of the budget which they received just five years ago highlights the need to rationalize and integrate our income assistance programs as long ago as 1969 i called for a complete overhaul of our discredited welfare programs i said then that whether measured by the anguish of the poor themselves or by the drastically mounting burden on the taxpayer the present welfare system has to be judged a colossal failure at that time i proposed the family assistance plan neither the congress nor the country accepted that proposal i do not intend to resubmit a new version of the family assistance plan since then we have made a concerted effort to improve the administration of the existing programs in 1973 for the first time in recent years because of vigorous new federal and state initiatives to enforce the rules more strictly growth in the aid to families with dependent children case load was halted but in their overall impact the welfare programs remain a failure and an outrage as an example of the failure recent studies have shown that fully 40 percent of the afdc benefits being paid are either going to ineligible persons or are incorrect in amount this performance is not just the result of fraud although there is some of that it is primarily and overwhelmingly the result of a system which is so complex and so riddled with obscure obsolete and incomprehensible regulations that it defies fair and efficient administration i plan to make a major new effort to replace the current maze of welfare programs with a system that works this task will be difficult but we have no other alternative save further waste both of lives and dollars i welcome the evidence that thoughtful members of the congress after careful study have reached the same conclusion while this effort goes forward i will make every possible effort to improve the operation of the existing programs through administrative reforms recognizing that a replacement system can not be developed enacted and put into operation overnight but unless we move urgently to the development of a new system efforts to improve the administration of the present programs wilt eventually be undermined by their basic structural flaws in the development of my proposal i will be guided by five principles 1 all americans who are able to work should find it more rewarding to work than to go on welfare americans would strongly prefer to have good jobs rather than a federal handout while we should provide cash assistance to those in need we must always encourage complete for those who are capable of it 2 cash assistance is what people need most from the federal government the people themselves not the federal government know their own needs best 3 we need to focus federal help on those who need it most people in need should receive equal treatment from the federal government regardless of their place of residence 4 the new system should be as simple as possible to administer with rules that are clear and understandable it should be based on objective criteria rather than the personal judgment of administering officials and it should be efficient 5 this new approach should not require an increased tax burden for any of us too much of the income of all of us now goes to support government we help no one certainly not those in weakening our free enterprise system by even higher taxation starting from these basic principles i believe we can develop a new system which would ensure that those who can help themselves do help themselves and which would allow those who can not help themselves to live with dignity and improving our people health in february of 1971 i outlined to the congress a new national health strategy to assure that no american would be denied access to high quality medical care because of an inability to pay much has already been accomplished toward meeting that objective a little over two years ago i took special satisfaction in signing into law the national cancer act which enabled us to launch an accelerated effort to conquer this dread disease considerable progress has been made in our attack on cancer and there is much hope that additional knowledge can be developed in the future in the budget that i will submit to the congress next monday i plan to ask for an additional 100 million above last year request of 500 million for the expanded attack on cancer in addition biomedical research in other areas including heart disease has been intensified and the total 1975 budget for biomedical research will exceed 2 billion more than double the total in fiscal year 1969 we are also making headway toward increasing the nation supply of health manpower during the last ten years first year medical school enrollments have grown by more than 55 percent the number of other health professionals also can be expected to grow dramatically just last month i approved legislation along the lines i requested in 1971 to permit the federal government to support the demonstration of health maintenance organizations across the nation during both 1974 and 1975 125 million will be provided through health maintenance organizations to demonstrate the benefits of prepaid health care to our citizens federal programs to finance health services for the aged for the disabled and for low income persons have been greatly expanded since 1969 medicare and medicaid coverage has been extended to an additional 21 million aged disabled and americans the range of services covered under medicare and medicaid has also increased consumer safety programs to assure safe foods drugs cosmetics and other consumer products have received almost a fourfold increase in federal funding since 1969 despite all these advances however too many americans still fail to receive needed health care because of its costs and too often the costs of health care threaten our citizens with bankruptcy while the services that can prevent or cure disease are not fully utilized as one of my major new initiatives for 1974 i shall soon submit to the congress a comprehensive health insurance proposal which would make available health insurance protection to millions of americans who currently can not obtain or afford the private health insurance coverage they need provide all americans with vastly improved protection against catastrophic illness place a new emphasis on preventive health care provide state and federal subsidies for families and for those whose special health risks would otherwise make them uninsurable or insurable only at exorbitant expense my comprehensive health insurance proposal will build upon the strengths of the existing health system rather than destroying it it will maintain the high quality of medical care without requiring higher taxes it will be based on partnership not on paternalism and most importantly it will require doctors to work for their patients not for the federal government this plan would require that employers offer a comprehensive health insurance plan to all their employees with the employer paying a share of its costs the role of private health insurance in financing health care would be expanded and the consumer opportunity to choose between competing health insurance plans would be enhanced in addition to this plan there are a number of other measures that i urge the congress to enact this year these include a health resources planning act to help states and localities improve their planning and use of health resources new and expanded national health service scholarship legislation to increase the number of federal scholarships available to students in health professions and also to help ensure that the federal government can meet its needs for physicians and a general expansion of the guaranteed student loan program to provide adequate financial assistance to all professional and graduate students including health professionals improving education the federal government should provide strong leadership in assuring equal access to a high quality education for all americans and in bringing about renewal and reform of all of our education programs since 1969 we have raised federal spending for education from billion to billion an increase of 76 percent in special messages to the congress on education in the past i set forth five major proposals to improve american education they were a new program of student assistance to help to ensure for the first time in the nation history that no qualified person is barred from attending college by lack of money a national institute of education to be the focal point for educational research and development aimed at increasing our knowledge of how to help students learn a national foundation for higher education to encourage innovation in learning beyond high school an emergency school aid program to assist desegregating school districts a thorough reform of the programs for federal support of elementary and secondary education consolidating the myriad separate categorical grant programs in order to transfer educational decisions back to the state and local levels where they belong the first four of these basic proposals have been enacted in whole or in part and a great deal has already been accomplished through them as for the fifth reform of federal funding for elementary and secondary education i believe that 1974 should be the year of its enactment college student assistance the basic educational opportunity grant program is the primary vehicle in my effort to ensure that no qualified student be denied a college education because of lack of funds in my new budget i am asking congressional approval to strengthen this program by providing grants of up to a year for needy students altogether when combined with other student funding efforts the federal government in the coming fiscal year would provide an estimated billion of financial aid to students an increase of over 900 million from the level of five years ago since the present student assistance programs are targeted to help the neediest and because the costs of higher education have risen dramatically many middle income students are now finding it increasingly difficult to make ends meet i therefore also recommend that the limit on total borrowing be increased so that professional and other graduate students will be able to find adequate student loans educational research and development when i originally proposed the creation of a national institute of education i suggested that providing equal opportunity for quality education means in part increasing our knowledge about the ways that students learn and then changing the way we teach them for too long we have followed the belief that bigger educational programs are necessarily better educational programs and that money alone can solve our educational problems but now we are beginning to see that the quality of our thinking about education can be as important as the size of our educational budget the national institute of education can help us to marshal our educational resources in ways which will produce the best results it has already begun to provide the kind of leadership in educational research and development which i have long believed was needed educational innovation beyond high school while the national foundation for higher education which i proposed in 1970 has not been established the fund for the improvement of education was set up by the congress the fund is now providing support for the development and demonstration of more effective approaches to college level education our initial assessment leads me to believe that the fund will in the years to come become the primary focal point for innovation in higher education assisting school desegregation under the emergency school aid act of 1972 an estimated 467 million in federal funds will have been provided to local school districts by the end of 1975 to assist in the process of elementary and secondary school desegregation to encourage voluntary programs to overcome minority group isolation and to assist in meeting the educational needs of children who because of racial isolation have not had an equal educational opportunity by the school year the bulk of the problems incident to de jure segregation should have passed however to provide assistance to those other school districts which may still be required to take special desegregation measures as the result of court rulings i have budgeted an additional 75 million for fiscal year 1975 in addition the federal government will continue to provide civil rights education advisory activities to local districts to assist them in meeting any remaining problems busing i have often my opposition to the use of forced busing for purposes of achieving racial balance i have also proposed legislation which would dictate reasonable limits on the use of forced busing and i have opposed the consolidation of school districts in an effort to achieve racial balance in the larger district such consolidation plans have only led to more busing and the eventual disappearance of the neighborhood school the end result of an excessive reliance on forced busing and the imposition of arbitrary ratios has frequently been an increasing concentration of the poor and minorities in our central cities and the serious weakening of the very school systems which must serve them in some cases the education of minority children has actually suffered not benefitted from such plans i shall continue to support the passage of legislation which makes busing only a last resort tightly circumscribed even then i will also continue to work with the congress to revise my proposals in light of unfolding events in this area funding elementary and secondary education i am encouraged by the interest the congress has continued to show in legislation which follows the concepts put forward in my proposed better schools act i believe that meaningful compromise is now possible and that we can at last reform and consolidate federal grants for elementary and secondary education vocational programs and adult education i hope that the congress will include four basic elements in this reform consolidation of existing categorical grant programs granting greater authority to state and local educational agencies greater equity in the distribution of federal funds to the states for the education of disadvantaged children reform of the impact aid program to concentrate support in those districts where the federal presence has substantially decreased the tax base rather than those in which it has increased the tax base upon enactment of legislative authorities that accomplish these goals for elementary and secondary education vocational programs and adult education i will propose special supplemental appropriations to provide funding for the school year this funding would place most elementary and secondary education grant programs on a forward funded basis letting state and local agencies know how much they will receive while plans for the next school year are being made forward funding is an important concept in the financing of education and it merits the full support of the federal government as i noted in my message sent to the congress on education policy last week i also recommend additional support for several other educational old and some new these include an additional increase in aid to black colleges and other developing institutions during fiscal year 1975 thus quadrupling federal funds for these important educational institutions since i took office continuation and extension of the head start program our single largest child development program in 1975 head start will reach disadvantaged youths as well as some during the it will extend its activities to include handicapped youth the consolidation of eight separate authorities for education of the handicapped into four broader and more flexible programs schools i remain firmly committed to the principle of educational diversity the continued health of the nation schools is essential to this concept although governmental efforts aimed at supporting these schools have encountered difficulty in the courts i believe we must continue our efforts to find ways to keep these schools open for that reason i continue to support legislation which permits tax credits for parents who pay to send their children to schools helping our veterans million americans living today have given military service to their country as a group veterans are among our most productive citizens studies show that they generally have higher incomes more education and better health than of the same age we can be proud of the veterans contributions but we must also be concerned for those veterans and veterans families who remain in need the assistance provided to veterans and their families in recent years has been substantial total compensation payments for veterans disabled or killed in military service have been increased from billion in 1969 to billion in the coming fiscal year medical care in va hospitals and clinics has been greatly improved and expanded with ten new or replacement hospitals now in service and five more in preparation educational benefits per trainee have more than doubled since 1969 last year two key measures one expanding health care and the other improving the national cemetery system for veterans were passed and signed into law of vital importance the unemployment rate for vietnam era veterans has been sliced from 11 percent in early 1871 to 4 percent by late 1973 as a result vietnam era veterans have a higher employment rate than others of their same age a significant achievement that is well deserved earlier this week in a special message to the congress i proposed additional legislation to help veterans in two crucial areas in 1974 pensions and education my pension proposals would benefit some i million veterans and million veterans survivors who are in economic need because of disability age or the loss of a breadwinner va pensions already go a long way toward meeting such needs but the pension structure itself is fraught with inequities and anomalies that are technical in nature but tragic in consequence my proposals would correct these deficiencies veterans now in training require additional help if their gi bill allowances are to keep pace with rising costs i shall therefore propose that gi bill benefits be raised by an average of 8 percent i have also set a 1974 goal for the government of placing an additional million veterans in jobs or job training there remain sizable numbers of educationally disadvantaged veterans and veterans who have never taken advantage of federal training opportunities and are now unemployed i have directed that as a matter of high priority the federal government efforts to reach these veterans be intensified and that they be counselled and encouraged to use the available services equal opportunity for all americans this administration has made a determined effort to secure equal opportunity for those who have been previously denied such opportunity i am personally very proud of the success those efforts have already achieved and i am committed to building on that success in the future progress for minority groups members of racial minority groups have made considerable strides toward equal opportunity in recent years the following are among the more notable benchmarks of this progress setting an example as an equal opportunity employer in the past five years the federal government has added more than minority group members to its civilian employee roles in the armed forces more than 850 cadets are now enrolled in the military academies and whereas prior to 1971 only four minority group members had ever achieved general or flag rank in the armed forces now sixteen serve on active duty as generals and admirals federal aid to minority business enterprises one of the cornerstones of the administration effort to open new economic horizons for minority group nearly tripled since 1970 civil rights enforcement activities have continued at a vigorous level with their funding substantially increased since 1969 combined federal expenditures on civil rights activities and minority economic development programs have grown from less than 1 billion to billion five years ago 68 percent of all black children in the south were still attending schools now that figure has been reduced to 8 percent and the dual school system has been virtually eliminated the government has also sought to expand job opportunities through legal actions of its own against those who may be engaged in discriminatory practices during 1972 and 1973 the department of justice initiated 34 pattern and practice lawsuits against approximately 207 defendants these suits directly covered more than employees during the same period of time approximately 37 cases were fully resolved by entry of decrees and an additional six were partially resolved by the entry of decrees the decrees entered in those two years alone covered more than employees and provide specific goals for the hiring of more than minorities and women in traditionally white and male jobs in addition those decrees provide new transfer of seniority rights for approximately minorities and women and provide for back pay awards which are estimated to amount to well over the real story lies not in these figures themselves but in the facts and the attitudes they represent they do not represent a flamboyant promise but rather a quiet determination to work not only toward the symbols but also toward the substance of equal opportunity they represent an effort to build foundations that will last in particular the foundation of economic independence and of a basic faith in the equal dignity of mankind justice for american indians for too many years the american first americans have been the last americans to receive the rights and opportunities to which they are entitled this administration has taken the initiative to change this picture for its part the federal government must put behind it the role of autocratic manager of indian reservations we shall continue to encourage indians and their tribal governments to play an increasing role in determining their own future we are also particularly determined to defend the natural resources rights of indian people the last five years have been historic steps in federal indian policy in 1971 we worked closely with indian leaders to achieve a settlement of alaska native claims a settlement consistent with america sense of fairness and also indispensable to the growth and development of all of alaska we also returned lands taken away long ago from the taos pueblo at blue lake we returned lands wrongfully taken from the yakima people because the menominee people have seen their tribal states involuntarily terminated but had nevertheless kept their land and their tribal structure together the congress enacted and i signed the bill which restored the menominee tribe to trust status in the courts we are forcefully asserting indian natural resources rights as we have done in protecting indian rights in pyramid lake one measure of our attempt to foster a better more humane policy is the level of federal funding benefitting american indians over twice what it was five years ago or about billion i am especially encouraged by the fact that the rate of infant deaths pneumonia influenza and tuberculosis is significantly lower among indians than ever before although we have not yet achieved our full goals of health and educational services for the indian people that are fully compatible with those of the general population this progress demonstrates our continuing commitment the congress has shared in these accomplishments in a spirit of bipartisan cooperation i hope that i will soon have on my desk two more enactments on which congressional action is progressing measures to speed indian economic development and to upgrade the position of the commissioner of indian affairs to the assistant secretary level also still awaiting congressional action are four other proposals i have submitted previously to permit turning over to indian tribal governments the management and control of indian programs to create an indian trust counsel with authority to safeguard indian natural resources rights to help ensure that funds for indian education actually reach indian children and to provide greater local control over federally assisted reservation programs through a program of tribal grants looking forward i shall ask that the bureau of indian affairs make specific plans to accelerate the transfer of significant portions of its programs to indian tribal management although i repeat my assurance that while accelerated these transfers will not be forced on indian tribes not willing to accept them the the citizens of our nation face special problems in obtaining equal opportunities because of language and cultural barriers for that reason my administration has made a special effort to expand those opportunities our progress on this front is reflected in many ways nearly spanish surnamed americans have been employed by the federal government despite an overall reduction in federal jobs the small business administration has also increased its loans to hispanic businessmen reaching a total of 109 million in fiscal year 1973 in 1969 the cabinet committee on opportunities for the people was created the cabinet committee has both made the government more aware of the needs and the talents of citizens and helped to expand federal employment of the since the authorization for this organization expires this year i am asking the congress to extend its life through june 30 1975 the cabinet committee on opportunities for the serves to focus the administration continuing efforts in this important area of concern the rights of women both men and women have become increasingly aware of the pattern of sometimes blatant but often subtle discrimination to which women are subjected some of this discrimination can be erased by existing law some requires new law some would be rectified by the equal rights amendment now nearing ratification by the required of the states it is my hope that the equal rights amendment will be ratified speedily so that equal justice under our laws will become a reality for every american one of the primary goals of this administration is to ensure full equal employment opportunity for women by striving to open to women jobs that previously were reserved for men often simply by habit or custom specifically we have moved vigorously both to enforce the law and to lead by example insisting on equal employment and promotion opportunities within the federal service by promoting more women into the professionally critical areas of middle management and by continuing our special recruiting drive to bring more women into the highest levels of government to help advance these goals i have appointed the first woman counsellor to the president and she in turn has set up a new office of women programs within my executive office we are particularly proud that this administration is the first to have women as heads of three independent federal agencies the atomic energy commission the federal maritime commission and the united states tariff commission the effort to improve the economic status of women outside the government is also continuing the equal employment opportunity commission which has been given enforcement power in the federal courts has reported a marked increase in its activities to end sex discrimination in employment we will continue to pursue all these efforts with vigor this emphasis is especially appropriate as we approach 1975 which has been declared international women year by the united nations one especially invidious form of sex discrimination in particular is ripe for correction now through new legislation the discrimination that often denies women equal access to credit in an economy that increasingly operates on credit this is a particularly grievous practice the congress already has before it a proposal to ensure that credit is extended to all persons on an equitable basis without regard to their sex or marital status this administration strongly supports this proposal and is sending to the congress amendments which we believe will strengthen it even further i urge prompt consideration and passage of this vital legislation protection against crime and invasions of privacy over the past five years i have had no higher domestic priority than rolling back the tide of crime and violence which rose in the 1960s i am therefore especially pleased with the progress we are making on this front after 17 years of continuous and often dramatic increases crime in 1972 registered its first overall decline although in 1973 it again registered a slight increase it still held below the level of 1971 now that the momentum of increase has been broken i am confident that we can look forward to further reductions in crime rates in the years ahead serious crime in our largest cities was actually reduced by 13 percent between 1971 and 1973 in washington where the federal government has special law enforcement responsibilities crime has been cut in half since 1969 indictments and convictions of organized crime racketeers have more than tripled since 1969 thanks in large measure to the 1970 organized crime control act and to expanded federal interagency strike forces in addition of course the riots urban terrorism and burnings of the 1960s have now become a thing of the past these indications of success do not mean that we should slacken our effort but that we should intensify it key elements of our strategy to do so most of which will require the assistance of the congress include comprehensive reform of the federal criminal code last year i submitted a proposal which was based upon the work of the justice department and a study completed by the national commission on reform of federal criminal laws the federal criminal code has not been completely revised in a quarter century and the need for reform is urgent i call upon the congress to act expeditiously in reforming our criminal code to make it both more workable and more responsive to the demands of our complex society restoration of the death penalty under the federal criminal code for several especially heinous specific crimes which result in the death of innocent victims examples of such crimes are hijacking kidnapping or bombing increased federal assistance to state and local law enforcement agencies for the next fiscal year i propose funding through the law enforcement assistance administration of 886 million up from only 60 million in 1969 increasing the resources available to the attorneys offices throughout the nation offices which have in the last three years increased the number of criminal convictions by 28 percent creation of additional federal judgeships to assure speedier disposition of criminal cases legislation to accomplish this goal is now before the congress comprehensive improvement of federal correctional programs already 15 additional correctional institutions have been built acquired or begun my 1975 budget request would represent a tripling of 1969 budget levels a new effort to deal more effectively with employment problems caused by the increase in the number of illegal aliens entering this country legislation to achieve this objective is also before the congress protecting the right of privacy one of the basic rights we cherish most in america is the right of privacy with the advance of technology that right has been increasingly threatened the problem is not simply one of setting effective curbs on invasions of privacy but even more fundamentally one of limiting the uses to which essentially private information is put and of recognizing the basic proprietary rights each individual has in information concerning himself privacy of course is not absolute it may conflict for example with the need to pursue justice but where conflicts occur an intelligent balance must be struck one part of the current problem is that as technology has increased the ability of government and private organizations to gather and disseminate information about individuals the safeguards needed to protect the privacy of individuals and communications have not kept pace another part of the problem is that clear definitions and standards concerning the right of privacy have not been developed and agreed upon i have therefore ordered an extensive review which will be undertaken this year of both government and industry practices as they relate to the right of privacy of the conflicts that arise and the balances that must be struck between legitimate needs for information and the right of privacy and of those measures including appropriate can be taken to ensure that these balances are properly struck ending drug abuse during the decade of the increasing numbers of americans including a high percentage of young people each year turned to heroin and other drugs in search of new highs and synthetic solutions to the problems of life in this retreat from reality the nation drug problem grew dramatically residents of our proudest cities were gripped by fear as addicts turned to crime to support their habits and thousands of families suffered devastating personal tragedies i am pleased to be able to report that since then federal spending on drug treatment and enforcement have increased tenfold and progress has been made we have indeed turned the corner on hard drugs better drug law enforcement at home and abroad has caused an acute heroin shortage throughout much of the country enough treatment capacity has now been created so that virtually all addicts who want medical help and counselling can get it our drug abuse indicators all suggest that we have at last succeeded in reducing both the total number of heroin addicts and the number of new addicts nevertheless the drug battle is far from over for the sake of the next generation i am determined to keep the pressure ensure that the heartening progress made to date is translated into a lasting victory over heroin and other drugs as enforcement efforts meet with success in one area of the world pressure increases on other trafficking routes to meet these new threats we will step up our support of joint drug enforcement programs i have also directed that plans for increased vigilance at our own borders be put into effect in the treatment area we are intensifying our efforts to encourage addicts to undergo treatment to provide added incentive for those not motivated to seek help on their own i have directed federal agencies to expand their support for local programs which direct addicts charged with crimes into treatment pending trial and sentencing continued progress will also require help from the congress i will shortly recommend severe new penalties for both heroin traffickers and those engaged in illegal distribution of other illicit drugs this legislation will supplement my proposals currently pending before the congress the psychotropic convention a key international treaty regulating manufactured drugs worldwide has after 2 years still to be ratified affirmative action in this session is of the utmost importance i will continue to pursue a balanced approach to the drug problem in the next year by emphasizing both vigorous law enforcement and treatment and rehabilitation programs to help speed the return of to productive lives in society enhancing the environment both our nation and the world have made imposing strides during recent years in coping with the problems of our natural environment building upon concerns we have created institutions developed policies and strategies and deepened public understanding of the problems that face us now we are entering the second phase of environmental action it may prove to be a more difficult period in this second phase we will be looking at our environmental problems in new ways which are more complex and than those to which we have been accustomed we must be concerned not only with clean air clean water and wise land use but also with the interaction of these environmental efforts with our need to expand our energy supplies and to maintain general prosperity in facing up to these tough new problems we can draw strength from the progress we have already made and from the knowledge that there can be no turning back from our general commitment to preserve and enhance the environment in which we live our record over these past five years includes the vigorous enforcement of air quality legislation and of strengthened water quality and pesticide control legislation the enactment of new authorities to control noise and ocean dumping regulations to prevent oil and other spills in our ports and waterways and legislation establishing major new parks recreation and wilderness areas we have also tried to reorganize the federal structure in ways that are more responsive to environmental needs the national environmental policy act passed in 1969 has provided a basis for reform in our federal agencies and has given citizens a greater opportunity to contribute to environmental decisions in 1970 i established the environmental protection agency and national oceanic and atmospheric administration to provide more coordinated and vigorous environmental management also in that year i appointed the first council on environmental quality producing results the results of our vigorous efforts are now being seen and felt in our major cities levels of dangerous sulfur oxides and particulates have declined and pollutants from automobiles have been reduced water pollution is being conquered assisted by a massive federal commitment of over 14 billion in municipal treatment plants during this administration major misuses of pesticides are now under control and major sources of noise are being regulated for the first time during these five years federal agencies have acquired over additional acres for preservation for future generations many of them near our heavily populated urban centers such as new york and san francisco in addition the legacy of parks program which i initiated in 1971 has made massive strides in bringing parks to the people to date 400 separate parcels covering almost acres of federal lands in all 50 states have been turned over to state and local governments for park and recreational use many of them are near congested urban areas we will continue to expedite transfer of additional surplus properties to state and local governments for park and recreation use improving the world environment on our small planet pollution knows no boundaries world concern for the environment is as necessary as it is encouraging many significant international actions have been taken in recent years and the united states can be proud of its leadership these actions have included the signing of international conventions to protect endangered species of wildlife to regulate ocean dumping to extend the national park concept to the world and to control marine pollution a united nations environment program was established last year with it the un environment program fund came into being fulfilling a proposal i had made in 1972 under the environment agreement which i signed in moscow in may 1972 soviet and american scientists and environmentalists have been actively working together on serious environmental problems the challenge ahead as part of this administration continuing effort to conserve outdoor recreation areas my new budget will propose full funding of the land and water conservation fund for 1975 nearly will aid state and local governments in acquiring their own recreation lands and facilities coupled with the change i have proposed in the formula for allocating funds to the states this measure would encourage the development of more recreational sites closer to the places where people live and work this year we have the unique opportunity and responsibility to determine the future use of enormous land areas in america last great frontier alaska last month in accordance with the alaska native claims settlement act i transmitted to the congress recommendations that would add million acres in alaska to the national park national forest wildlife refuge and wild and scenic rivers systems if the alaska frontier is thoughtlessly developed it will be gone forever but we now have the opportunity to make considered judgments as to the appropriate uses of these outstanding alaskan lands for the american people of all future generations this session of the congress has before it 17 major natural resources and environment proposals that i have previously submitted and on which i again recommend action these include department of energy and natural resources while i discuss this new department elsewhere in this message i want to reemphasize that i consider it of cardinal importance in ensuring that complex interrelated environmental and natural resource issues receive an appropriately wide policy overview and administrative coordination land use policy adoption of the national land use policy act first proposed in 1971 remains a high priority of my administration this legislation would reaffirm that the basic responsibility for land use decisions rests with states and localities and would provide funds to encourage them to meet their responsibility i am pleased that the senate has passed legislation incorporating some of the policies that i proposed i urge the congress to pass legislation which would assist states and localities but which does not inject the federal government into their specific land use decisions coastal wetlands these environmentally vital wetlands are increasingly threatened by development my proposed environmental protection tax act would amend federal tax laws to discourage the unwise use of these areas and to enhance our opportunities for sound land use planning within the coastal zone wilderness traditionally we have looked westward for our wilderness areas last year however i proposed that 16 eastern areas be designated as wilderness and that 37 others be studied for possible wilderness designation historic preservation because we have an irreplaceable historic and architectural heritage i have proposed an environmental protection tax act to discourage the demolition of historic structures and to encourage their rehabilitation big thicket national biological reserve the big thicket area of east texas is a biological crossroads unique in the united states i am gratified that the house has acted and i urge the senate promptly to consider my proposal to preserve key segments of the thicket in a big thicket national biological reserve big cypress national fresh water reserve protection of the big cypress swamp in florida is essential to the preservation of the water supply in the everglades national park i have recommended legislation which would authorize the acquisition of over acres enabling us to protect this vital water supply public land management the secretary of the interior needs additional authority to protect the environmental values of our public domain lands i again urge that he be given that authority controlling pollution three of my legislative proposals aimed at controlling pollution have not yet received final congressional action toxic substances new chemicals with unknown environmental effects come into use each year authority to test these substances and to restrict their use in the event of danger while still permitting the orderly marketing of needed chemicals in a timely fashion is highly desirable hazardous wastes disposal of wastes on land is increasing due to advances in industry and technology and because of our stringent controls on air and water pollution these wastes can be hazardous to human health and other forms of life my proposal provides for national standards for treatment and disposal of hazardous waste with primary regulatory responsibility resting with state governments safe drinking water the water we use in our homes should not endanger our health under my proposal on safe drinking water federal standards would provide health protection by requiring strict limitation of any contaminants in drinking water but primary enforcement responsibilities would be left to the states alternative legislation is now being seriously considered by the congress which would require unnecessary federal standards on operating treatment plants generate a domineering federal enforcement role and create several new categorical subsidy programs community development although american communities share many of the challenges of our age the relative intensity and the particular nature of these challenges vary sharply from one community to another the current way of providing most federal aid to our communities with each dollar tied to a string pulled and manipulated by a federal planner is wrong much of the money that pays the federal planners could better be spent in the local community the decisions made by the planners could better be made by the people who live on the scene in these past few years we have sought to change the old system we have recognized that the federal policy that will work best is one that helps the people of a particular community define their own needs and meet those needs in the way which they consider best while in this administration we have tried to be generous we have also tried to grant communities greater freedom to set their own priorities since 1969 we have spent twice as much money on community development programs as the federal government had spent for this purpose in the entire previous history of the nation reduced the red tape and arbitrary restrictions on local action that were so much a part of these programs in the past moved authority for administering community development programs from washington to the field where administrators are more accessible to local officials and where they can become more familiar with local problems stepped up federal support for state and local planning and management again spending more for this purpose than had been spent in all previous years combined as a result not only have cities received more federal dollars but they have been able to accomplish more with each dollar than before despite this progress we need a much more sweeping reform than has been possible under existing laws therefore i once again urge passage of the better communities act a billion bill which would give local officials new flexibility and provide greater effectiveness in the expenditure of federal community development funds this legislation would consolidate seven categorical grant programs into a single program funds would be distributed on the basis of need and then local communities could decide for themselves what projects should come first thus we could eliminate a mountainous volume of red tape and allow local government to play a larger role in determining their own destinies two congresses have now addressed community development legislation both of them have agreed for the most part with the basic principles and approaches that the better communities act represents but we have still had no action cities and towns that have counted on having this legislation in effect in the next fiscal year now face an uncertain future i urge the congress to move ahead as quickly as possible with the better communities act and i pledge every effort to work out our remaining differences so that our cities and towns can benefit from this program as soon as possible i also urged the 93rd congress to pass the responsive government act that i submitted last year this measure would enable state and local officials to improve their planning and managerial capabilities through broadbased flexible grants rural development over 12 billion has been invested in rural development through agriculture department programs alone during the five years of this administration annual federal funding for these rural development programs has been tripled during that time these funds have been spent for rural housing where more than billion has been provided through housing loans electrification and telephone systems where over 3 billion has been spent to bring service to new rural consumers water and waste disposal where some loans and grants totaling billion have been provided to rural communities for water and waste disposal systems loans to farmers who received more than loans totaling over billion in addition to these efforts under department of agriculture programs almost 200 other federal programs have had a significant impact on rural areas as a result rural residents receive as much federal support per capita as residents of urban areas during the past year we have markedly increased our activity on behalf of the nation rural residents during 1973 the rural development act was funded for the first time to provide over 750 million in loans and grants to states under procedures which give them a new flexibility in promoting rural industrialization and in improving the quality of rural life an interim rural housing policy was developed placing greater emphasis on more effectively utilizing existing housing and making farmers home administration programs more responsive to those with the greatest housing needs to ensure continuing government attention to rural development needs this administration has also created both a special rural development committee and the new post of assistant secretary of agriculture for rural development as we look to the future patterns of national growth we must never forget that the prosperity the vitality and the character of rural america are essential cornerstones of our nation balanced growth it is essential that rural america receive its proper share of our attention and i am determined that this shall be the case helping disaster victims seldom is swift and effective government action needed so urgently as when a natural disaster strikes since taking office i have had to declare over 160 major disasters in 42 states and in 3 territories in recent years the amount of federal assistance given to disaster victims has been greatly expanded and we have also pressed an intensive effort to provide this aid more equitably and expeditiously since more than 90 percent of all property damage resulting from natural disasters is caused by floods i was especially pleased by the congress approval last year of our proposed flood disaster protection act which significantly expands and improves the national flood insurance program more remains to be done however if we are to meet our basic humanitarian responsibility to those who fall helpless and innocent victims to nature on the rampage therefore i have also proposed a disaster preparedness and assistance act which places new emphasis on the essential element of preparedness while also increasing the role of state and local officials in allocating federal disaster funds and cutting the tangle of red tape it also provides for the automatic use of federal resources when major disasters strike and it includes generous grant features for those individual disaster victims unable to repay government loans as well as for communities faced with the task of restoring damaged public facilities that natural disasters will continue to strike is certain the only uncertainty is how well prepared we will be as a generous and compassionate nation we should be prepared to give the victims of these disasters the prompt and effective help they so desperately need better housing for all as i have stated many times this administration will not waver from the federal commitment first outlined in the housing act of 1949 a decent home and a suitable living environment for every american family the state of america housing will continue to depend on the state of america economy more than on any other factor the forces of the marketplace are the forces that count the with sufficient real income and sufficient confidence to create an effective demand for better housing on the one hand and builders and credit institutions able to respond to that demand on the other the federal government must play a major supporting role through its actions in the mortgage credit market and its help for low income families who need assistance in obtaining adequate housing last september as credit for housing was becoming increasingly scarce the administration acted to make more credit available to home buyers recently mortgage market conditions have begun to improve however to assure continuing improvement i recently authorized a reduction in the maximum allowable interest rate for mortgages insured by the fha the farmer home administration and va a more than 6 billion mortgage insurance program that will assist in financing the construction of up to housing units these actions should have a favorable impact on housing production if the anticipated results are not fully achieved i will recommend further action to ensure a reasonable level of production in the last five years a substantial effort has been made to address the country housing problems largely because of a general upswing in the economy housing production has occurred at record levels fha mortgage insurance has enabled nearly 3 million families to purchase homes over two million units of subsidized housing for low and moderate income families have been approved more than during the previous 33 years of federally subsidized housing programs over billion has been committed to improving and modernizing existing public housing subsidies to local housing authorities have grown from 33 million in 1969 to 350 million in 1974 even as good housing has become a reality for most americans it is clear that important problems still exist two are especially significant first our credit institutions often encounter problems in providing adequate housing credit second too many low income families are unable to obtain adequate housing even as good housing sits vacant in their community we must help them to meet their needs in order to increase the availability of housing for all families i urge passage during this session of two key measures i have already proposed the financial institutions act to enable savings and loan associations to compete more effectively for funds during periods of tight money as well as to encourage increased investment in housing through a tax credit on income earned from residential mortgages the administration proposed housing act which would ease the present tight mortgage credit situation and make home ownership easier in the long term by authorizing increases in the permissible mortgage amounts eligible for fha insurance permitting home buyers to pay market interest rates on fha and va insured mortgages and reducing the cost of buying a home by doing away with the present system of charging points on mortgage loans authorizing on an experimental basis more flexible repayment plans on fha insured mortgages authorizing more flexible interest rates longer repayment terms and higher amounts for mobile homes and home improvement loans this legislation would extend authority for extensive experiments with a new approach direct cash assistance for addressing the housing problem of low income american families despite the commitment of over 66 billion evidence has clearly shown that the subsidized housing programs for low income families have not worked well instead of programs to treat symptoms i will continue to press for a longer term goes to the root of the of sufficient income and which permits the private housing market to work in as efficient a way as possible additionally this legislation would improve the operation of our existing public housing projects by helping them move to a more effective efficient and basis of operation improving transportation the energy crisis has made urgent what once seemed only necessary the building of a transportation system that permits all americans to travel efficiently and at reasonable cost while some elements of our transportation system such as the federal highway network have been dramatically improved or expanded in the past decade others notably the railroads have fallen into serious difficulties it is also apparent that our public transit system must be greatly improved within our urban centers the measures already taken and others which i shall propose this session are particularly important in helping to deal with the energy crisis by encouraging a more sensible utilization of our transportation resources during the past four years several key measures have helped lay the basis for a greatly improved transportation system under the urban mass transportation act of 1970 we increased annual federal aid to urban public transportation to i billion by 1973 8 times the level of 1968 and in 1973 another 3 billion was made available for the years immediately ahead for the first time since world war ii the downward trend in transit ridership has been reversed and is now moving upwards and for the first time under the provisions of the highway act of 1973 states and localities can now use a portion of their federal highway funds for public transit purposes there has also been improvement of rail passenger service under amtrak a public corporation created by the rail passenger service act of 1970 after years of steady decline in rail passenger service the past year saw a 14 percent increase in the number of passengers carried on amtrak just this past year we also went to work to avoid a major rail crisis through passage of the regional rail reorganization act of 1973 which provides for the restructuring of the bankrupt railroads of the northeast and midwest region into a streamlined system by 1976 we hope that the affected railroads will be able to operate profitably and can survive as producers not consumers of tax revenues significant new initiatives have also been taken in airport and airway development making vitally needed improvements in the merchant marine and in promoting transportation safety especially on our nation highways clearly however there is still much to be done it is my hope that 1974 will be the year when we make major advances by enacting two critical transportation bills one of these proposals which i will send to the congress in the near future would give our communities not only more money but also more freedom to balance their own transportation needs and it will mark the largest federal commitment ever to the improvement of public transportation this bill would increase federal assistance for metropolitan areas by nearly 50 percent over the level of fiscal year 1974 more than of those funds would be allocated by formula to state and local governments and those governments could better determine their own transportation priorities choosing between construction of highways or public transit systems or the purchase of buses or rail cars additional transit aid would also be made available to rural communities for the first time under this bill resources would also be available for the first time to augment the operating funds for public transportation systems in both urban and rural areas by permitting federal resources to be used for operating purposes this proposal should make it unnecessary to establish a new categorical grant program for transit operating subsidies as is now contemplated in bills before the congress as a second major transportation initiative this year i shall propose that we modernize the regulatory system governing railroad operations this legislation would make it easier for railroads to consolidate service on a sustainable basis it would make changes in the system of rate regulation to allow rail carriers to compete more effectively with one another and with alternative modes of freight transportation discriminatory state and local taxation of interstate carriers would be barred it would also provide 2 billion in federal loan guarantee authority to finance improvements in terminal and rail plant facilities and rolling stock where necessary which would be a major step in our effort to improve the nation railroad system additional transportation measures i shall soon propose will include improvements in highway safety through the earmarking of approximately 250 million of the 1975 federal highway program for the elimination of death traps from the highways by for example improving intersections and replacing dangerous bridges new bonus grants to the states will also be initiated to encourage the adoption of improved safety legislation and to reward states for outstanding safety accomplishments a restructuring of the airport and airway financing system to allocate costs more equitably among the users of our airways and to provide more flexibility in the use of funds district of columbia last christmas eve when i signed the new home rule bill into law the nation capital reached a significant milestone if the voters of the district accept the proposal in the forthcoming referendum the city will soon have its first elected mayor and city council in 100 years in addition to giving the citizens of our nation capital the right to elect their own officials and a greater role in decisions affecting local affairs the act also transfers to the district functions now carried out in federal agencies which should rightfully be under local control in order to accomplish this transfer of responsibilities to the local government much work will have to be done this administration will make every effort to assist in that transfer and to ensure that it is both timely and effective while our attention to the affairs of the district of columbia has been captured by the transition to home rule we must not ignore another important task before us as the city moves into a new era of it must also prepare for the nation celebration of the bicentennial a federal bicentennial task force has been working to ensure that the federal government meets its financial and program commitments in the nation capital under the leadership of the bicentennial coordination center which i established over two years ago a number of projects are moving forward the national visitors center constitution gardens the eisenhower civic center the fort circle parks the national air and space museum and other projects will contribute enormously to the celebration which takes place here in 1976 in addition the pennsylvania avenue development corporation will soon present its plan to restore and improve this central historically important thoroughfare during the coming year i also urge the congress to take action on pending legislation to create a district of columbia development bank which would do much to broaden the economic base of the district the bicentennial as we near the celebration of america bicentennial which officially begins in march of 1975 the tempo of preparations has picked up a sound organizational framework has now been established with the approval by the congress last year of a new american revolution bicentennial administration each of the 50 states the district of columbia and the four territories has also established its own bicentennial commission to plan and coordinate local bicentennial projects some 370 counties cities towns villages and tribal units have been recognized as bicentennial communities and some 600 applications for this designation are currently being reviewed on the federal level i have created the domestic council committee on the bicentennial this committee has approved the goals for federal participation in the bicentennial established an interagency bicentennial task force and approved over 200 bicentennial projects of the departments and agencies the department of the interior will complete the development of historically significant national park sites the national foundation on the arts and the humanities will support cultural activities relating to the bicentennial and many of our other national institutions such as the smithsonian institution will present special exhibitions across the nation other nations are actively responding to the invitation to the world that i issued on july 4 1972 to participate with us in this celebration which is not ours alone but one which draws on the heritage of every nation from which people have come to our shores in celebrating america bicentennial we shall of course commemorate our national achievements we shall honor our celebrated leaders even as we remember those whose contributions were less well known we shall take stock of our shortcomings and resolve to overcome them what we will celebrate most of all in 1976 will be the vitality of the american people we have tried to ensure that federal bicentennial activities reflect the diversity which is ours alone and which is appearing in community bicentennial planning across the country culture and communications when i took office in 1969 i was determined to give support to the goal of substantially strengthening the arts and humanities in the united states the result has been the rapid growth of the national endowment for the arts and the national endowment for the had existed before but at a very low level of activity in the current year the national endowment for the arts will spend million on a large scale of programs intended to enrich america cultural present and future a broad range of individuals as well as institutions both public and private are being assisted and special support is being given to projects which will add to the celebration of our bicentennial the congress has in the past given strong bipartisan support to the arts endowment that same support will be needed in the future increased federal funds eliciting greater financial support from the private sector and state and local governments will ensure the flourishing of american arts in the years ahead the national endowment for the humanities has likewise made outstanding contributions to the stimulation of our intellectual and cultural life one measure of the growing importance of its activities is the fact that the humanities endowment has a program today which is ten times as large as it was five years ago the humanities endowment will also play a major role in promoting the bicentennial and will emphasize activities which reach large numbers of people such as film and television productions and traveling exhibitions in america television is by far the best means of communicating with the widest audience to assure the american audience a greater range of television programming of a type not financially feasible for commercial television we have dramatically increased our support for public television in the last five years public broadcasting matured during the past year both the television and radio licensees reorganized themselves in a way which encouraged a more rational relationship between them and the corporation for public broadcasting and increased the ability of each local station to provide programs uniquely tailored to their local communities another aspect of electronic media that has recently become a public policy issue is cable television a development that could lead to a vast expansion of the nation communications capabilities in june of 1971 i established a cabinet committee to develop proposals for a comprehensive national policy on cable communications i have recently received and am now reviewing the report which is the product of that committee i have also asked the director of telecommunications policy to prepare legislation to move toward the adoption and implementation of a national cable television policy and i expect to submit such legislation to the congress in the near future i encourage the congress to review carefully the issues presented by cable television and i especially encourage a widespread national debate on this subject which could play such a major role in all of our lives during the future science and technology one of the great strengths of this nation has been its preeminence in science and technology in times of national peril we have turned to the men and women in the laboratories in universities government and private industry to apply their knowledge to new challenges once again in the current energy crisis we are calling upon them to respond i have outlined in my recent energy message to the congress the first step in a 10 billion research and development effort in energy billion for direct energy r d for the coming fiscal year and an additional 216 million for supporting research a total increase of 80 percent over this year a look at the broad scope of this energy effort tells a great deal about our confidence in the capabilities of the nation scientists and engineers we are calling on them to accelerate the development of nuclear power systems to determine how we can use our abundant supplies of coal in ways that are environmentally acceptable and to improve technology for harnessing natural energy sources such as the sun and the heat of the earth at the same time we are asking them to explore new ways of conserving the energy that we already use for everyday conveniences such as our automobiles this administration recognizes that the need for progress in every major area of american life requires technological input we are therefore committed to giving all our major programs a broad scientific underpinning the new budget will call for an increase of over 20 percent in civilian research and development expenditures in addition to a major increase for energy research and development funds will be spread across a large number of programs for enhancing the prosperity and health of americans science will continue to be vital to our efforts to fight drug abuse to prevent infant mortality to combat venereal disease and to aid in treating mental illness we will call upon the services of our scientists and engineers to design better forms of transportation and to make safer the transportation we already have we will examine ways of making our vast agricultural establishment yield more food at lower prices and try to lessen pollution we will attempt to develop methods of mining that will not only yield greater mineral wealth but also give the miner greater safety and the landscape greater protection we will study ways to protect our wildlife from natural and attack and we will attempt to learn how to protect ourselves from the violence of nature in the form of floods landslides earthquakes tornadoes and other natural calamities this administration recognizes the vital role which the social sciences must play in america growth money will be made available for studying the social effects of various government income distribution and redistribution plans such as social security welfare benefits health insurance and varied and experimental educational forms in every great area of national endeavor the administration will see that adequate funds for making scientific progress are spent that also means we will continue our important efforts in space the exploration of space is today making a key contribution to man understanding of his universe and to our abilities to manage our resources on earth wisely as our skylab astronauts have proven space is now an acceptable working environment for man while we explore our planetary system the stars and the galaxies we are also using space technology to monitor the earth environment the earth resources technology satellite is allowing us to search for scarce resources from high above the earth already many of our intercontinental communications are by satellite this year new commercial satellites will also be used for domestic telephone telegraph and television services satellite weather forecasting is now commonplace as a result of our space efforts space exploration in the future should become more economical as we develop the space shuttle a reusable vehicle for space transportation a cooperative international aspect of the space program will come with the european developed as an integral part of the shuttle program in addition we are now moving full speed ahead with our plans for a joint space venture with the soviets in 1975 the new federalism just as the rapidly changing and increasing demands placed upon government have made it necessary to reorganize the federal structure they have made it even more imperative to make state and local government stronger and more effective during the last four decades almost every major attempt by the government to meet a major social need has resulted in a new national program administered in washington by a new bureaucracy forty years ago there were more than federal employees today there are more than million in the last decade this problem has grown acute in 1960 there were some 200 federal programs with outlays of 8 billion but by 1970 there were nearly and the total outlays had risen to 22 billion and in the next fiscal year we expect outlays for programs to reach 52 billion even after our substantial efforts to cut their number this growth in size power and complexity has made the federal government increasingly inaccessible to the individual citizen it seeks to help many of our new national social programs have actually impeded the development of effective local government by creating a federal categorical grant system of staggering complexity and diversity we have fostered at the state and local level overlapping and wasteful programs distorted budgets and priorities additional administrative expense delay and uncertainty and a diminution in the authority and responsibilities of state and local elected officials as federal grants have become the special province of competing bureaucracies in one of the basic new directions of my administration i proposed in 1969 that we create a new and fundamentally different relationship between state and local government on the one hand and the federal government on the other this new relationship has come to be known as the new federalism as i said in 1969 its purposes are to restore to the states proper rights and roles in the federal system with a new emphasis on local responsiveness to provide both the encouragement and necessary resources for local and state officials to exercise leadership in solving their own problems to narrow the distance between people and the government agencies dealing with their problems to restore strength and vigor to state and local governments where elected officials know best the needs and priorities of their own constituents and to shift the balance of political power away from washington and back to the country and the people with the help of both the congress and the administration this new relationship among local state and federal governments has begun to take shape in 1972 the congress enacted our general revenue sharing program and already more than 11 billion of new money has been put to work in over units of state and local government funding through the law enforcement assistance program has demonstrated the flexibility of the new federalism in leaving to state and local authorities the decisions on how best to combat crime in their jurisdictions this program has helped to make america streets safer for our citizens the comprehensive employment and training act which i signed into law in 1973 is a landmark example of the new federalism broad and more flexible forms of assistance and it represents a leading example of what can be achieved when the executive and the congress team up to enact solid legislation new authorities under the rural development act are being exercised this year in a way which is supportive of state and local development plans and priorities in addition within the limits of law we have moved administratively to strengthen the role of state and local governments by simplifying and streamlining federal grant systems including procedures for state and local review of project proposals affecting their jurisdictions opportunities for grant integration and joint funding and the decentralization of many federal activities to ten federal regional councils in the remaining three years of this term i shall continue to take every sound administrative action within the authorities available to me to support and strengthen state and local government but we must have the support of the congress to maintain the progress which has begun proposals for furthering the new federalism now before this body and for which i urge your support include federal education reforms to consolidate support for elementary and secondary schools as well as vocational and adult programs and to promote better planning on the local level through advance funding the better communities act to replace several ineffective and restrictive urban programs with a flexible approach that would allow local officials to make essential decisions on the way community development funds would be spent the responsive governments act to provide needed federal assistance for improving state and local planning and management capabilities this would help to strengthen the capacity of state and local governments to assume greater responsibility for the administration of their own programs whether federally assisted or not the disaster preparedness act to increase the role of state and local officials in allocating federal disaster funds and to cut the tangle of federal red tape in addition to these proposals now pending a number of the new initiatives that i describe elsewhere in this message also reflect the principles of new federalism these include a new public transportation initiative that would permit states and urban and rural to allocate highway and mass transit funds in accordance with local conditions and priorities an economic adjustment assistance program that would help states and communities to create employment opportunities where they have been affected by structural changes in their economies which has brought about persistent unemployment or depressed incomes in the field of health a comprehensive health insurance plan which would bring protection against medical expenses within the reach of all our citizens making government work better on taking office five years ago one of the first needs i sought to address was the organization of the executive branch of government for the plain fact is that the only way government gets anything done is through its organizational structure and how well it can perform depends in large measure on how well it is organized because the needs of the nation continue to change and because the activities of government must respond to those changes the patterns of government organization that might have been fine in the 1930s or even in the 1960s may be hopelessly out of date in the 1970s therefore early in my first term i established an expert commission to survey the organization of the executive branch and to recommend improvements to meet needs the reports of this commission contributed significantly to the reorganizations that i ordered and that i recommended including the proposal i put forward three years ago for a sweeping reorganization of the executive branch consolidating seven of the present cabinet departments into four new units although this basic restructuring has not been enacted by the congress other progress of a substantial nature has been made in modernizing the government for example we have established the united states postal service taking the post office out of politics the office of management and budget providing a strong management arm to assist in coordinating the functions of the executive branch a restructured national security council the domestic council to coordinate domestic policy formulation the council on environmental quality the environmental protection agency and the national oceanic and atmospheric administration all to provide leadership in meeting our vital environmental needs the special action office for drug abuse prevention and the drug enforcement administration the council on economic policy to facilitate the formation and execution of overall economic policy the council on international economic policy to focus on an area increasingly important both to our foreign relations and to our domestic economy action to provide stronger coordination and incentives for volunteer activities the cost of living council to help stabilize prices and the federal disaster assistance administration to help individuals and communities struck by natural disasters each of these reorganization steps was designed to meet a specific need more effectively or to respond to newly urgent needs several were accomplished under the reorganization plan authority which has been available to every president in the last 25 years but which expired last march this authority which is utilized only with the concurrence of the to be necessary in order to keep abreast of changing needs and i urge that it be reinstituted of special concern today is the reorganization of the government to meet the energy crisis i have by executive order already established the federal energy office to serve as a focal point for energy actions taken by the government but that office lacks a statutory base and does not have sufficient authority to do the full job that is why i have asked the congress to establish the federal energy administration and i once again urge it to act on this matter recognizing that this country should no longer remain dependent upon foreign energy sources i have also urged the creation of an energy research and development administration to develop the necessary technology to tap new domestic sources of energy and a separate nuclear energy commission to carry on the regulatory activities presently assigned to the atomic energy commission while these organizational initiatives are needed now the best organization to knit together the future energy and natural resource programs of the federal government would be a comprehensive department of energy and natural resources this concept is consistent with the major federal departmental reform i submitted to the congress in 1871 today i again urge swift favorable action by the congress on this proposal so that we will have the broad organizational base that will ultimately be needed to meet many of our energy needs in the most effective manner and to balance energy and natural resource considerations in the future that same consolidation and reorganization of the executive branch that i proposed in 1971 would also have created new departments for community development human resources and economic affairs the basic problems of fractionated sometimes overlapping and often conflicting organizations that prompted these original proposals remain acute today i therefore urge the congress to join with me in a serious effort to achieve an effective reorganization in these areas in view of the close relationship between food assistance programs and other income security programs i will also propose new legislation to transfer the food stamp and related programs from the department of agriculture to the department of health education and welfare another important organizational proposal still awaiting congressional action is the creation of an independent legal service corporation my administration will work closely with the congress in the weeks ahead to obtain final passage of our proposal which would provide the poor with quality legal representation would create an organization free from political pressures and would include safeguards to ensure its responsible operation legal services legislation has already passed the house i am hopeful that reasonable legal services legislation will now be passed by the senate a major new opportunity for better federal management has been initiated at my direction by the office of management and budget frequently termed management by objective it involves the identification of specific objectives for each year for each of the departments and agencies during the year progress in reaching these objectives can be closely measured and reported to agency heads and to me in the years ahead i expect this technique will help make the government both more responsive and more accountable nothing is more important to improving the efficiency of our government than the recruiting of top flight personnel for federal jobs including positions in the career civil service we will be working in the months ahead to ensure that executive compensation career development and training all attract and hold the best possible personnel in the public service the compensation we provide our top officials is integral to these efforts to recruit and retain the best men and women for government service salaries of federal judges members of the congress and heads and assistant heads of executive agencies have not been adjusted for 5 years during which time comparable pay rates in the private sector increased 30 percent and pay for other federal employees has increased significantly the report of the commission on executive legislative and judicial salaries notes that this lag in compensation also produces serious salary compression among the top ranks of career employees i am therefore recommending a increase in executive legislative and judicial salaries in the budget at the rate of 7 percent annually for each of the next three years this will make salaries within the top levels of the federal government more competitive with industry and it will help us to make government work better campaign reform for several years it has been clear that reforms were needed in the way we elect public officials the intense public focus placed on the campaign abuses of 1972 has now generated sufficient support for this issue that we now have an opportunity to make a genuine breakthrough in a national radio address on may 16 of last year i announced my proposal for a commission on campaign reform this commission would have reexamined the entire federal election process to come up with a comprehensive set of legislative recommendations the commission would have filed a public report no later than december 1 1973 eight months have now passed since that proposal was submitted to the congress and the commission is not even close to being created if it had been created expeditiously we would now have its report recommending meaningful reforms for federal campaigns and as i had originally hoped those reforms might be in place prior to the 1974 elections in light of the delay i have now decided to submit a comprehensive set of administration proposals on campaign reform for consideration by the congress during this session while i do not believe mine will be the only workable proposals i do hope they will lead to meaningful debate and reform in this critical area to that end i look forward to working with the congress in a effort to clean up the federal election process america and the world when this administration took office it was apparent that the world had changed in fundamental ways and that america foreign policy had to change in equally fundamental ways we needed to end our military involvement in the vietnam war in a manner consistent with our responsibilities and commitments as a major world power we needed to adjust to the changes in the strategic situation between the soviet union and the united states which presented a unique opportunity to build a solid foundation for peace but which also threatened our own security if that foundation could not be built we needed to end a quarter century of hostile isolation which had kept of the world population outside the framework of international cooperation the world could not afford another generation of hostility between the united states and the people republic of china we needed to adjust our partnerships with western europe and japan recognizing their increasing political and economic strength and and emphasizing our important common goals we needed to alter the world monetary system to reflect the new realities of the international economic system and america place in it during the past five years we have made striking progress in meeting each of these needs continuing responsibility in vietnam the united states is at peace for the first time in more than a decade but peace must be something more than the absence of the active engagement of american forces in conflict we must guard against the tendency to express relief at our military extrication from southeast asia by washing our hands of the whole affair men and women are still dying there we still have a responsibility there we must provide those ravaged lands with the economic assistance needed to stabilize the structures of their societies and make future peace more likely we must provide as well the continued military aid grants required to maintain strong defense forces and we will continue to insist on full compliance with the terms of the agreements reached in paris including a full accounting of all of our men missing in southeast asia building new relationships as we work through detente to reduce conflict in areas of the world where both we and the soviet union have important interests we must also continue to work to reduce the potential causes of conflict between us we must persevere in our negotiations with the soviet union to place further limits on strategic arms competition and in our talks with the warsaw pact nations to reduce forces in europe in a way that will increase security and stability for all we will pursue our relations with the soviet union in the climate of detente established two years ago in moscow and reaffirmed by general secretary brezhnev visit to washington last year during the fateful weeks of the middle east war last october the strength of our detente was severely tested since then american diplomatic leadership and initiative have played a central role in the search for a final settlement in the long troubled middle east this began with the of october 22 worked out with the soviet union assistance and was later strengthened by the agreement in november to consolidate the then by the geneva peace conference under the of the united states and the soviet most recently by the agreement on the disengagement of egyptian and israeli military forces which is being implemented in cooperation with the united nations emergency force these steps are but the beginning of broadened efforts to find a lasting settlement of the area problems the process of building a normal relationship with the people republic of china continues liaison offices have been established in our respective capitals and there continues to be fruitful contact between our governments at very high levels strengthening our free world partnerships as our relationships with old adversaries are changing so are our relationships with old friends western europe and japan have put behind them the postwar struggle to rebuild their economies their societies and their political force their success in these endeavors is something we helped to foster and in which we can take pride but now times have changed and our past role in their success can not be the sole basis for a continuing relationship we must instead adjust our relationships to recognize their new economic capacities and their international political objectives we must accommodate all of these within the framework of the friendship and goodwill of our allies and our whole past history of cooperation in the pursuit of our common goals this is a cornerstone of the structure of peace we are seeking to build with our closest neighbors here in the western hemisphere we shall continue to seek additional ways of working cooperatively to solve the problems which face the americas secretary of state kissinger will be meeting in a few weeks with the foreign ministers of latin america to begin a new and constructive dialogue in the family of american states international trade and commerce as we turn from an era of confrontation to one of cooperation trade and commerce become more important we have moved from a position of virtual economic hegemony in the world to a new role in a more interdependent world economy we must create an equitable and efficient system of integrating our own economy with that of the rest of the world much has already been accomplished on this front the markets of the ussr and china are now accessible thereby providing jobs for american workers our major trading partners in western europe and japan share our interest in further reducing international trade barriers and increasing world trade the rigid and outmoded international monetary system which the dollar and impeded our foreign trade has been decisively altered after two years of trade deficits america achieved a trade surplus in 1973 but we must persevere in our international monetary investment and trade negotiations the greatest tasks still lie ahead and the stakes are high avoiding the economic and political disruptions associated with international monetary turmoil and restrictive trade and investment practices increases in importance as international interdependence grows as i noted earlier in this message prompt passage of the pending trade reform act is essential to achieving the goal of a less restrictive and more equitable international economic system in addition we must move forward with the current negotiations to reform the international payments system under the auspices of the international monetary fund reforms which will markedly increase the opportunities for nations to trade and invest profitably we must also strengthen our resolve as the world most prosperous nation to help less fortunate countries in the world of today no nation will be fully secure or prosperous until all nations are as in the past we will take pride in our efforts to work with developing nations which aspire to greater economic and social the united states has called for the world food conference which will be held in november under the auspices of the united nations we will also actively observe 1974 as world population year as proclaimed by the united nations maintaining a strong defense forge but as we work for we must be conscious that the opportunity to build a structure of peace came because our arms have served as a deterrent to war we must maintain that deterrent in the last five years outlays for the department of defense have been reduced by about measured in constant dollars and military personnel have been cut from million to million this year i will recommend a substantial increase in the 1975 budget for the department of defense these increases are necessary to improve the readiness of our armed forces to build up levels of essential equipment and supplies and to preserve present force levels in the face of rising costs conclusion throughout these five years i have had one overriding aim to establish a structure of peace in the world that can free future generations from the scourge of war others may have different priorities this has been and will remain my first priority the chief legacy that i hope to leave from the eight years of my presidency as we strengthen the peace we must also continue each year a steady strengthening of our society here at home our conscience requires it our interests require it we must insist on it as we create more jobs as we build a better health care system and improve education as we develop new sources of energy as we provide more abundantly for the elderly and the poor as we strengthen the system of private enterprise that produces our prosperity as we do all this and more we solidify those essential bonds that hold us together as a nation even more importantly we advance what in the final analysis government in america is all about more freedom more security a better life for each one of the 211 million individual persons who are america we can not afford to neglect progress at home while pursuing peace abroad but neither can we afford to neglect peace abroad while pursuing progress at home with a stable peace all is possible without peace nothing is possible earlier in this message i comment that one of the continuing challenges facing us in the legislative process is that of the timing and pacing of our initiatives selecting each year among many worthy projects those that are ripe for action at that time what is true in terms of our domestic initiatives is true also in the world this period we now are in these few a juncture of historic forces unique in this century which provide an opportunity we may never have again to create a structure of peace solid enough to last a lifetime and more not just peace in our time but peace in our children time as well it is on the way we respond to this opportunity more than anything else that history will judge whether we in america have met our responsibility i have full confidence that we will meet that responsibility richard nixon the white house january 30 1974
enter 1974 beginning historical cycle middle one beginnings made many vital areas beginnings must build upon new needs arisen process addressing opportunities coalescing give us chance make historic progress toward stable peace expanding prosperity looking agenda 1974 consider work one year isolation select tasks 1974 must build work years anticipate needs ahead indeed one continuing challenges facing us legislative process timing pacing initiatives would false pretend could afford everything would maintain nothing therefore must strive maintain steady progress selecting year among many worthy projects ripe action time accommodated within constraints budget pressing ensure done clone discussing legislative recommendations congressional session therefore shall context advances already made problems remain special opportunities 1974 make progress started certain basic premises basic tax burden american taxpayer increased new initiatives therefore scaled prudently spent given level revenues would generated existing tax structure full utilization resources increases federal spending kept minimum budget flexible enough used necessary maintain jobs prosperity essential break old habit regarding federal program established permanent must learn scrap old programs longer effective needed favor new ones way afford must done within guidelines number major new initiatives ripe action 1974 several milestones march life greater freedom greater opportunity greater prosperity particular 1974 year first break back energy crisis also project independence lay foundation future capacity meet america energy needs america resources reasonable prices adequate environmental protection second take another giant stride toward lasting peace world continuing policy negotiation rather confrontation great powers concerned also helping toward achievement lasting settlement middle east third check rise prices without administering harsh medicine recession move economy period steady growth sustainable level fourth establish new system comprehensive health insurance makes high quality health care available every american dignified manner price afford fifth continue build new era achievement responsiveness state local government cutting strings tight federal control bound hands state local officials community economic development programs sixth make crucial breakthrough toward better transportation strengthening ability local communities deal transportation problems seventh reform system federal aid education provide needed needed need eighth make historic beginning task defining protecting right personal privacy ninth start new road toward reform welfare system bleeds taxpayer corrodes community demeans meant assist tenth together nations world establish economic framework within americans share fully expanding world trade prosperity years ahead open access markets supplies meeting energy needs start congressional session number one legislative concern must energy crisis cooperative efforts american people together measures already taken administration significantly reduced immediate impact energy crisis economic dislocation individual hardships minimized policy encouraging broad conservation measures allocating scarce energy resources least possible harm jobs economy object keep farms factories producing keep workers job keep goods services flowing even means must live work somewhat less comfortable surroundings drive fewer miles slower speeds even full cooperation americans however still face real challenges genuine shortages months years immediately ahead meet challenges must change patterns energy consumption production must press forward development reliable new energy sources must adjust fact age unlimited supplies cheap energy ended immediate energy crisis began oil embargo imposed middle east last fall embargo hastened shortage already anticipated number years fuel consumption climbing production domestic energy supplies declined became heavily dependent oil imports consequently vulnerable interruption reduction imports well sudden increases foreign prices today interruption supplies face sharply increased prices supplies restored irrespective possibility restoring flow middle east oil must act ensure never dependent foreign sources supply energy needs must continue slow rise rate consumption must sharply increase domestic production effects energy conservation felt already responsiveness american people recent crisis proved major factor helping avoid serious consequences winter might brought conservation must continue required increase domestic supplies achieved rapidly involve development entirely new sources energy well expanded development oil coal resources require significant expansion research development efforts require shift use scarce fuels plentiful also expensive cheap energy accustomed require encourage exploration production mean act prevent energy industry making unconscionable windfall profits must also avoid crippling industry punitive legislation finally require make difficult decisions sort economic environmental priorities seek act domestically increase fuel supplies act internationally effort obtain oil reasonable prices unreasonable increases cost vital commodity oil poses threat entire structure international economic relations jobs prices incomes stake general pattern international cooperation stake well hope work cooperative efforts friends abroad eau meet energy needs without disrupting economies without disrupting economic relationships last week sent congress comprehensive special message setting forth energy situation energy prospects energy needs legislative measures consider necessary meeting needs shall repeat analysis full list recommendations today want urge however critical energy measures proposed made first order legislative business session congress work go forward expeditiously others measures request given highest priority following special energy act would permit additional restrictions energy consumption would postpone temporarily certain clean air act requirements power plants automotive emissions windfall profits tax would prevent private profiteering expense public sacrifice unemployment insurance people areas impacted serious economic dislocation mandatory reporting major energy companies inventories production reserves also asking congress quickly establish federal energy administration energy research development administration provide appropriate organizational structure administering national energy policy work toward establishment department energy natural resources 13 energy measures requested last week deal needs extending beyond present emergency also require expeditious action achieve goal project independence capacity energy 1980 success project independence essential continued strength position world trade also independence action great power hope joint efforts resolve energy crisis move toward capacity energy enable president addresses 98th congress decade look back say made possible america enjoy continued peace prosperity 1980s nation economy world economy past three years united states reached unprecedented level material prosperity industrial output set new records trade flourished consumption risen highest levels history even inflation serious economic problem face one lowest industrialized free world major policy decisions took 1971 contributed significantly prosperity countries clear example moved 1970s international monetary system adopted world war ii needed major adjustments unsustainable imbalances developed threatening resurgence protectionism disruption world trade decided take strong measures august 1971 measures resulted major realignment world currency values progress toward new flexible international monetary management negotiations toward open equitable trading system adjustments essential easy finally entered flexible realistic international financial system much remains done complete transition beneficial results already clear realignment currency values helped produce increase 80 percent 50 billion rate exports past two years along major improvement trade balance improvement good us also rest world addition shocks world economy arising reduced food supplies 1972 1973 recent months oil embargo arbitrary increases price oil managed without panic new arrangements indeed world trade continued expand despite temporary difficulties international trade barriers vigorous international trade vital american economy jobs american workers depend ability develop foreign markets moreover american consumers deserve access products might less expensive interesting unavailable united states trade advantageous long run must conducted basis fair participants still many unnecessary barriers trade need lowered removed improvements made situation last 10 years need build progress negotiate open access markets supplies call upon congress special urgency complete action proposed trade reform act order provide authority need negotiate effectively reductions barriers trade improve trading system manage trade problems home effectively senate considers legislation would draw attention particularly provisions added house would seriously impede efforts achieve harmonious international relationships provisions would effectively prevent extension nondiscriminatory tariff treatment credits certain communist countries unless followed policy allowed unrestricted emigration convinced prohibition would make difficult kind cooperative effort united states governments necessary work together peace middle east throughout world confident working congress find solution problem avoid major setback peacemaking efforts time must move forward current negotiations reform international payments system auspices international monetary fund negotiations designed increase opportunities nations trade invest profitably already presented proposals deterring growth significant imbalances international monetary affairs preserving nation wide freedom choosing necessary adjustments best accomplished addition system also accommodate increased payments flow prospective reserve accumulations occasioned higher oil prices however nations share us preserve healthy growing world economy confident mutually acceptable solution problem achieved practice means markets must increasingly open imports developing countries condition would significantly facilitated enactment trade reform act also means congress must continue authorize appropriate fair share bilateral multilateral economic assistance including substantial contribution international development association helps poorest countries 1973 successfully negotiated reduction united states share 40 percent ida funds let action house voting ida stand final answer work hard congress ensure country continues play leadership role consistent economic situation economic development continue planned orderly manner along trade monetary problems new international agreements investment policies new mechanisms dispute settlement high negotiating agenda coming year must continue work economic arrangements permit beneficial flow international investment may derive maximum benefit resources end glad able note week united states completed phaseout controls flows capital country recent oil embargo especially arbitrary increases price oil created major economic problems many countries including united states continued policies would require enormous transfers goods assets oil importing nations transfers would represent serious burden even wealthiest countries would virtually unbearable less developed countries objectives clear must get world oil prices levels arbitrary exploitative must also cooperate ensure international domestic economic policies advanced countries compound economic disturbances created current emergency rather done contain limit disturbances domestic economy despite general prosperity inflation remains serious economic problem united states also rest world see clear evidence problem every hand world oil prices gone recently dramatic rates world food metals commodities prices also sharply domestic prices isolated international prices worldwide inflationary pressures helped drive prices home inflation continuous problem nearly decade got worse 1973 result people come expect continuing price increases behave accordingly economic life behavior turn adds inflationary pressures contributing vicious inflationary spiral difficult break people said best way wring inflationary expectations economy taking economy recession disagree true lower level economic activity would reduce demand thus lower pressure higher prices however cost policy terms increased unemployment would simply unacceptable token also reject notion totally ignore inflation concentrate solely stimulating higher levels employment policy would also involve high cost since would unleash acceleration inflation rate developing economic policy 1974 chosen believe sound middle road cushion economic slowdown expect 1974 without providing additional stimulus inflation expect policy reduce rate inflation end year appear serious threat severe slowdown act promptly vigorously support economy cope challenge inflation must recognize clear lesson recent years direct controls prices wages help fight inflation limited useful life inevitably eventual effect create aggravate significant distortions production distribution accordingly continue watch situation closely pursue policy gradual selective decontrol except particularly troublesome areas time federal programs help reduce inflation increasing supply scarce resources strengthened one key area look forward expanded supplies food new national farm policy encourages rather discourages output achieved record harvest 1973 another record harvest appears likely 1974 increased agricultural output sure way bring food prices increased output new policies producing rapid inflation inevitable must tolerated regain control inflation however require patience persistence long course administration dedicated achieving objective confident help american people succeed another pressing economic major contributor energy crisis cost using fuel resources came exceed cost imports 1960 became increasingly attractive us import oil petroleum products unfortunately growing dependence imports made entire economy vulnerable outside forces vulnerability tested recent months even greater vulnerability developed countries western europe japan less developed countries oil every american learned consequences vulnerability short fuel supplies higher fuel prices large extent flexible adaptable economy solve longer run energy problem normal workings marketplace energy prices reach somewhat higher levels bargain rates past conservation encouraged domestic energy production expanded one example normal market forces work recent shift smaller cars better gas mileage next years also expect see expansion coal production new output oil natural gas nevertheless still import oil need immediate future essential therefore seek reasonable price oil world market also imperative review current prospective supplies basic commodities therefore directed comprehensive report policy analysis made concerning crucial matter governmental actions properly anticipate help avoid damaging shortages even inflation energy problems 1973 year many important economic gains american people first employment 1973 increased million persons percent rise employment largest since 1955 new job opportunities greatly benefitted categories workers including women teenagers vietnam veterans unemployment reached low levels especially skilled workers second purchasing power american people reached new highs last year even allowing price increases people consuming goods services year ago year entire history united states everyone purchasing power went course inflation took toll many families whose income rise fast average american reason continue regard inflation serious enemy time however ignore substantial economic gains made perspective 1974 known time slowdown economic growth inevitable 1974 clear economy simply growing unsustainable rate shortages skilled workers full utilization plant equipment key industries short supplies number essential raw materials provided clear indications rate growth would taper unfortunately mild slowdown anticipated 1974 threatens somewhat pronounced oil embargo resulting shortages oil price increase expect therefore early part year output rise little unemployment rise somewhat inflation high objective however turn situation around later year output rising rapidly unemployment stop rising decline rate inflation slow role federal budget budget recommend congress next week help us achieve goals period support economy resisting major slowdown provide degree stimulation could accelerate inflation future events suggest change fiscal policy desirable promptly recommend appropriate changes particular hesitate use stimulus fiscal policy becomes necessary preserve jobs face unexpected slackening economic activity fiscal year 1975 budget recommends total spending billion increase billion current year increase held minimum level necessary nearly 90 percent increase unavoidable existing law budgeted increase relatively controllable outlays percent federal receipts reach 295 billion fiscal year 1975 increase 25 billion projected budget deficit billion conditions full employment however federal receipts would substantially higher would instead moderate budget surplus federal budget remains essential tool fight inflation energy supply limitations experiencing price pressures create budget discipline still required noted satisfaction members congress also recognized need budgetary discipline work going forward establish systematic budgeting procedure congress devoted considerable effort 1973 developing mechanism coordinating individual spending decisions budget whole continue support effort although troubled extraneous amendments added measures achieving goal urge congress enact workable budget reform legislative session tax reform entire economy affected incentives investments embodied tax laws major steps taken reform tax laws past five years much remains done since 1969 primarily tax reform act 1969 revenue act 1971 major changes introduced make personal income tax system conform nearly contemporary standards fairness higher level personal exemptions low income allowance worked free eight million low income families entire federal income tax burden difference tax liability single married taxpayers also reduced result tax changes individual income taxes 25 billion less 1974 would old tax laws saving tax burden typical family 270 equivalent two weekly paychecks average worker look forward working congress next months simplify tax laws also simplify tax forms individuals fill distribute income tax burden equitably last april secretary treasury presented congress set administration proposals major fundamental tax reform included proposals establishment minimum taxable income one could avoid paying fair share tax burden establishment new rules taxing income foreign sources also limitation artificial accounting losses eliminate tax shelters urge congress consider administration tax reform proposals early year also concerned excessive burdens imposed low income elderly families state local property taxes deal problem proposed refundable tax credit low income elderly persons whose property taxes exceed five percent income proposal would also provide equivalent relief low income elderly individual pays rent urge congress enact important proposal financial reform health economy depends upon efficient flexible private financial system commercial banks thrift institutions credit unions host institutions individuals comprise financial sector economy average family depends institutions provide fair reliable return savings provide credit reasonable terms needed buy homes automobiles purchases occasions recently financial system worked well occasions example mortgage lending difficult obtain large part problems result legislation regulations institutional arrangements suited earlier time obsolete remedy problem submitted draft legislation last year reflected results careful study presidential commission government experts urge congress act promptly matter american families businessmen local governments served financial system suited economic conditions 1970s administration also studying competitive position foreign banks within country american banks abroad make sure discriminatory regulations prevent american banks financial institutions business entitled following results study considerable interest submit congress proposals resulting study seem desirable healthy agricultural economy abundance primary goal farm policy abundance guarantee lower food prices every american higher incomes american farmers five years ago agriculture troubled industry government controls reducing incentives production costing taxpayers 3 billion year farm subsidies designed hold production farm income low billion long hours worked farmers earned average income 26 percent nonfarm average farm families leaving farm average rate year today picture dramatically altered farm markets expanded dramatically farm exports set new records last four years becoming largest single factor nation balance payments strengthening dollar international money markets farm production reached new record levels last three years new record harvest forthcoming 1974 billions tax dollars used go farm price support payments basic commodities every year reduced nearly zero farm income reached record levels 1973 gap farm income nonfarm income closed 26 7 percent net farm income billion billion making progress government regulation less one proudest achievements administration enactment agriculture consumer protection act 1973 places production decisions belong farmers government primary challenge federal agricultural policies encourage greater production agricultural mean income farmer greater international trading benefits nation reasonable food prices consumer therefore asking congress revamp programs still require restrictive federal control production remaining farm commodities especially rice peanuts tobacco sugar extra long staple cotton enhance agricultural activity administration also promote soil water conservation practices consolidate locations local offices federal agricultural agricultural stabilization conservation service soil conservation service farmers home administration federal crop insurance corporation creating agricultural service centers local level make things easier farmer less costly government place high priority directing agricultural research areas assure plentiful agricultural goods reasonable prices maintain competitive advantage world agricultural production protect land direction secretary kissinger recently proposed united nations convene world food conference concern made urgent acute food shortages many parts world conference held november 1974 prove particular importance american farmer whose extraordinary productivity made nation world leading food exporter whose prosperity continue increase help meet needs hungry world farm policy must course address needs farmer also consumer 1973 experienced period rapidly increasing food prices prices leveled late 1973 appear heading period increasing food prices least next months intention hold increases smallest possible rate executive actions lifting quota wheat imports action took last week significant force battle higher food prices higher production summer fall large 1974 harvest coming market serving best possible damper higher prices economic security one significant legislative achievements 1973 enactment comprehensive employment training act ceta form manpower revenue sharing bill transfers federal government states localities significant control design operation programs improve employability unemployed underemployed ceta landmark new federalism also landmark way better manpower programs legislation state local governments able use federal funds meet needs devote special attention employment problems particular local example might arise certain areas result present energy shortage new budget including additional 250 million ceta current fiscal year 350 million year beginning july distribution areas high unemployment overall requesting 2 billion fund training employment programs coming year proposals related economic security made congress last year urge action include establishment minimum vesting funding fiduciary standards private pension programs workers could greater assurance receiving pensions expect deserve retire urge work together resolve speedily remaining disagreements enact responsible legislation increases employee protection without burdening employers extent existing plans jeopardized new ones discouraged extension state local governments law forbidding employment discrimination older workers improvement unemployment insurance program several ways increasing state limits keep unemployed workers receiving reasonable proportion normal wage extending coverage farmworkers prohibiting payment benefits strikers assuring benefits unemployed result strike general improvements unemployment insurance augmented special extension present benefits specific areas country experience particularly high levels unemployment next 12 months addition basic coverage provided areas present unemployment insurance submit special legislation achieve purpose also continue support legislation raise minimum wage higher prices eroded purchasing power workers receiving current minimum wage must careful guard enacting bill includes sharp increases coverage extensions would keep low income workers employed bill minimum wage youths high unwittingly deny jobs finally must attack one troublesome problems faced rural urban areas existence persistent often severe unemployment low incomes areas whose character altered changes economy technology within next several weeks propose economic adjustment assistance program help states communities overcoming problems caused structural changes economies program would replace present economic development administration regional action planning commissions period orderly transition income security one measure nation character respect accords elderly another way helps need proud efforts made time reassess direction take future take pride fact cash benefits social security risen 26 billion fiscal year 1969 63 billion fiscal year 1975 primarily result five benefit increases totaling almost 70 percent reaching 19 million persons program supplemental security income initiated soon providing benefits 5 million aged blind disabled uniform nationwide basis way respects dignity income security programs need improved benefits past years multitude federally funded programs grown whose primary purpose income security need efforts reflects humane attempt respond worthy goal however cash service programs rapidly expanded past years two things become painfully clear first result extremely costly set generally unrelated uncoordinated programs many unintended undesirable consequences second efforts neither efficiently equitably accomplish overall objective assisting lower income families individuals achieve greater economic independence fact third new federal budget 100 billion spent income security programs fiscal year 1975 compared 38 billion budget received five years ago highlights need rationalize integrate income assistance programs long ago 1969 called complete overhaul discredited welfare programs said whether measured anguish poor drastically mounting burden taxpayer present welfare system judged colossal failure time proposed family assistance plan neither congress country accepted proposal intend resubmit new version family assistance plan since made concerted effort improve administration existing programs 1973 first time recent years vigorous new federal state initiatives enforce rules strictly growth aid families dependent children case load halted overall impact welfare programs remain failure outrage example failure recent studies shown fully 40 percent afdc benefits paid either going ineligible persons incorrect amount performance result fraud although primarily overwhelmingly result system complex riddled obscure obsolete incomprehensible regulations defies fair efficient administration plan make major new effort replace current maze welfare programs system works task difficult alternative save waste lives dollars welcome evidence thoughtful members congress careful study reached conclusion effort goes forward make every possible effort improve operation existing programs administrative reforms recognizing replacement system developed enacted put operation overnight unless move urgently development new system efforts improve administration present programs wilt eventually undermined basic structural flaws development proposal guided five principles 1 americans able work find rewarding work go welfare americans would strongly prefer good jobs rather federal handout provide cash assistance need must always encourage complete capable 2 cash assistance people need federal government people federal government know needs best 3 need focus federal help need people need receive equal treatment federal government regardless place residence 4 new system simple possible administer rules clear understandable based objective criteria rather personal judgment administering officials efficient 5 new approach require increased tax burden us much income us goes support government help one certainly weakening free enterprise system even higher taxation starting basic principles believe develop new system would ensure help help would allow help live dignity improving people health february 1971 outlined congress new national health strategy assure american would denied access high quality medical care inability pay much already accomplished toward meeting objective little two years ago took special satisfaction signing law national cancer act enabled us launch accelerated effort conquer dread disease considerable progress made attack cancer much hope additional knowledge developed future budget submit congress next monday plan ask additional 100 million last year request 500 million expanded attack cancer addition biomedical research areas including heart disease intensified total 1975 budget biomedical research exceed 2 billion double total fiscal year 1969 also making headway toward increasing nation supply health manpower last ten years first year medical school enrollments grown 55 percent number health professionals also expected grow dramatically last month approved legislation along lines requested 1971 permit federal government support demonstration health maintenance organizations across nation 1974 1975 125 million provided health maintenance organizations demonstrate benefits prepaid health care citizens federal programs finance health services aged disabled low income persons greatly expanded since 1969 medicare medicaid coverage extended additional 21 million aged disabled americans range services covered medicare medicaid also increased consumer safety programs assure safe foods drugs cosmetics consumer products received almost fourfold increase federal funding since 1969 despite advances however many americans still fail receive needed health care costs often costs health care threaten citizens bankruptcy services prevent cure disease fully utilized one major new initiatives 1974 shall soon submit congress comprehensive health insurance proposal would make available health insurance protection millions americans currently obtain afford private health insurance coverage need provide americans vastly improved protection catastrophic illness place new emphasis preventive health care provide state federal subsidies families whose special health risks would otherwise make uninsurable insurable exorbitant expense comprehensive health insurance proposal build upon strengths existing health system rather destroying maintain high quality medical care without requiring higher taxes based partnership paternalism importantly require doctors work patients federal government plan would require employers offer comprehensive health insurance plan employees employer paying share costs role private health insurance financing health care would expanded consumer opportunity choose competing health insurance plans would enhanced addition plan number measures urge congress enact year include health resources planning act help states localities improve planning use health resources new expanded national health service scholarship legislation increase number federal scholarships available students health professions also help ensure federal government meet needs physicians general expansion guaranteed student loan program provide adequate financial assistance professional graduate students including health professionals improving education federal government provide strong leadership assuring equal access high quality education americans bringing renewal reform education programs since 1969 raised federal spending education billion billion increase 76 percent special messages congress education past set forth five major proposals improve american education new program student assistance help ensure first time nation history qualified person barred attending college lack money national institute education focal point educational research development aimed increasing knowledge help students learn national foundation higher education encourage innovation learning beyond high school emergency school aid program assist desegregating school districts thorough reform programs federal support elementary secondary education consolidating myriad separate categorical grant programs order transfer educational decisions back state local levels belong first four basic proposals enacted whole part great deal already accomplished fifth reform federal funding elementary secondary education believe 1974 year enactment college student assistance basic educational opportunity grant program primary vehicle effort ensure qualified student denied college education lack funds new budget asking congressional approval strengthen program providing grants year needy students altogether combined student funding efforts federal government coming fiscal year would provide estimated billion financial aid students increase 900 million level five years ago since present student assistance programs targeted help neediest costs higher education risen dramatically many middle income students finding increasingly difficult make ends meet therefore also recommend limit total borrowing increased professional graduate students able find adequate student loans educational research development originally proposed creation national institute education suggested providing equal opportunity quality education means part increasing knowledge ways students learn changing way teach long followed belief bigger educational programs necessarily better educational programs money alone solve educational problems beginning see quality thinking education important size educational budget national institute education help us marshal educational resources ways produce best results already begun provide kind leadership educational research development long believed needed educational innovation beyond high school national foundation higher education proposed 1970 established fund improvement education set congress fund providing support development demonstration effective approaches college level education initial assessment leads believe fund years come become primary focal point innovation higher education assisting school desegregation emergency school aid act 1972 estimated 467 million federal funds provided local school districts end 1975 assist process elementary secondary school desegregation encourage voluntary programs overcome minority group isolation assist meeting educational needs children racial isolation equal educational opportunity school year bulk problems incident de jure segregation passed however provide assistance school districts may still required take special desegregation measures result court rulings budgeted additional 75 million fiscal year 1975 addition federal government continue provide civil rights education advisory activities local districts assist meeting remaining problems busing often opposition use forced busing purposes achieving racial balance also proposed legislation would dictate reasonable limits use forced busing opposed consolidation school districts effort achieve racial balance larger district consolidation plans led busing eventual disappearance neighborhood school end result excessive reliance forced busing imposition arbitrary ratios frequently increasing concentration poor minorities central cities serious weakening school systems must serve cases education minority children actually suffered benefitted plans shall continue support passage legislation makes busing last resort tightly circumscribed even also continue work congress revise proposals light unfolding events area funding elementary secondary education encouraged interest congress continued show legislation follows concepts put forward proposed better schools act believe meaningful compromise possible last reform consolidate federal grants elementary secondary education vocational programs adult education hope congress include four basic elements reform consolidation existing categorical grant programs granting greater authority state local educational agencies greater equity distribution federal funds states education disadvantaged children reform impact aid program concentrate support districts federal presence substantially decreased tax base rather increased tax base upon enactment legislative authorities accomplish goals elementary secondary education vocational programs adult education propose special supplemental appropriations provide funding school year funding would place elementary secondary education grant programs forward funded basis letting state local agencies know much receive plans next school year made forward funding important concept financing education merits full support federal government noted message sent congress education policy last week also recommend additional support several educational old new include additional increase aid black colleges developing institutions fiscal year 1975 thus quadrupling federal funds important educational institutions since took office continuation extension head start program single largest child development program 1975 head start reach disadvantaged youths well extend activities include handicapped youth consolidation eight separate authorities education handicapped four broader flexible programs schools remain firmly committed principle educational diversity continued health nation schools essential concept although governmental efforts aimed supporting schools encountered difficulty courts believe must continue efforts find ways keep schools open reason continue support legislation permits tax credits parents pay send children schools helping veterans million americans living today given military service country group veterans among productive citizens studies show generally higher incomes education better health age proud veterans contributions must also concerned veterans veterans families remain need assistance provided veterans families recent years substantial total compensation payments veterans disabled killed military service increased billion 1969 billion coming fiscal year medical care va hospitals clinics greatly improved expanded ten new replacement hospitals service five preparation educational benefits per trainee doubled since 1969 last year two key measures one expanding health care improving national cemetery system veterans passed signed law vital importance unemployment rate vietnam era veterans sliced 11 percent early 1871 4 percent late 1973 result vietnam era veterans higher employment rate others age significant achievement well deserved earlier week special message congress proposed additional legislation help veterans two crucial areas 1974 pensions education pension proposals would benefit million veterans million veterans survivors economic need disability age loss breadwinner va pensions already go long way toward meeting needs pension structure fraught inequities anomalies technical nature tragic consequence proposals would correct deficiencies veterans training require additional help gi bill allowances keep pace rising costs shall therefore propose gi bill benefits raised average 8 percent also set 1974 goal government placing additional million veterans jobs job training remain sizable numbers educationally disadvantaged veterans veterans never taken advantage federal training opportunities unemployed directed matter high priority federal government efforts reach veterans intensified counselled encouraged use available services equal opportunity americans administration made determined effort secure equal opportunity previously denied opportunity personally proud success efforts already achieved committed building success future progress minority groups members racial minority groups made considerable strides toward equal opportunity recent years following among notable benchmarks progress setting example equal opportunity employer past five years federal government added minority group members civilian employee roles armed forces 850 cadets enrolled military academies whereas prior 1971 four minority group members ever achieved general flag rank armed forces sixteen serve active duty generals admirals federal aid minority business enterprises one cornerstones administration effort open new economic horizons minority group nearly tripled since 1970 civil rights enforcement activities continued vigorous level funding substantially increased since 1969 combined federal expenditures civil rights activities minority economic development programs grown less 1 billion billion five years ago 68 percent black children south still attending schools figure reduced 8 percent dual school system virtually eliminated government also sought expand job opportunities legal actions may engaged discriminatory practices 1972 1973 department justice initiated 34 pattern practice lawsuits approximately 207 defendants suits directly covered employees period time approximately 37 cases fully resolved entry decrees additional six partially resolved entry decrees decrees entered two years alone covered employees provide specific goals hiring minorities women traditionally white male jobs addition decrees provide new transfer seniority rights approximately minorities women provide back pay awards estimated amount well real story lies figures facts attitudes represent represent flamboyant promise rather quiet determination work toward symbols also toward substance equal opportunity represent effort build foundations last particular foundation economic independence basic faith equal dignity mankind justice american indians many years american first americans last americans receive rights opportunities entitled administration taken initiative change picture part federal government must put behind role autocratic manager indian reservations shall continue encourage indians tribal governments play increasing role determining future also particularly determined defend natural resources rights indian people last five years historic steps federal indian policy 1971 worked closely indian leaders achieve settlement alaska native claims settlement consistent america sense fairness also indispensable growth development alaska also returned lands taken away long ago taos pueblo blue lake returned lands wrongfully taken yakima people menominee people seen tribal states involuntarily terminated nevertheless kept land tribal structure together congress enacted signed bill restored menominee tribe trust status courts forcefully asserting indian natural resources rights done protecting indian rights pyramid lake one measure attempt foster better humane policy level federal funding benefitting american indians twice five years ago billion especially encouraged fact rate infant deaths pneumonia influenza tuberculosis significantly lower among indians ever although yet achieved full goals health educational services indian people fully compatible general population progress demonstrates continuing commitment congress shared accomplishments spirit bipartisan cooperation hope soon desk two enactments congressional action progressing measures speed indian economic development upgrade position commissioner indian affairs assistant secretary level also still awaiting congressional action four proposals submitted previously permit turning indian tribal governments management control indian programs create indian trust counsel authority safeguard indian natural resources rights help ensure funds indian education actually reach indian children provide greater local control federally assisted reservation programs program tribal grants looking forward shall ask bureau indian affairs make specific plans accelerate transfer significant portions programs indian tribal management although repeat assurance accelerated transfers forced indian tribes willing accept citizens nation face special problems obtaining equal opportunities language cultural barriers reason administration made special effort expand opportunities progress front reflected many ways nearly spanish surnamed americans employed federal government despite overall reduction federal jobs small business administration also increased loans hispanic businessmen reaching total 109 million fiscal year 1973 1969 cabinet committee opportunities people created cabinet committee made government aware needs talents citizens helped expand federal employment since authorization organization expires year asking congress extend life june 30 1975 cabinet committee opportunities serves focus administration continuing efforts important area concern rights women men women become increasingly aware pattern sometimes blatant often subtle discrimination women subjected discrimination erased existing law requires new law would rectified equal rights amendment nearing ratification required states hope equal rights amendment ratified speedily equal justice laws become reality every american one primary goals administration ensure full equal employment opportunity women striving open women jobs previously reserved men often simply habit custom specifically moved vigorously enforce law lead example insisting equal employment promotion opportunities within federal service promoting women professionally critical areas middle management continuing special recruiting drive bring women highest levels government help advance goals appointed first woman counsellor president turn set new office women programs within executive office particularly proud administration first women heads three independent federal agencies atomic energy commission federal maritime commission united states tariff commission effort improve economic status women outside government also continuing equal employment opportunity commission given enforcement power federal courts reported marked increase activities end sex discrimination employment continue pursue efforts vigor emphasis especially appropriate approach 1975 declared international women year united nations one especially invidious form sex discrimination particular ripe correction new legislation discrimination often denies women equal access credit economy increasingly operates credit particularly grievous practice congress already proposal ensure credit extended persons equitable basis without regard sex marital status administration strongly supports proposal sending congress amendments believe strengthen even urge prompt consideration passage vital legislation protection crime invasions privacy past five years higher domestic priority rolling back tide crime violence rose 1960s therefore especially pleased progress making front 17 years continuous often dramatic increases crime 1972 registered first overall decline although 1973 registered slight increase still held level 1971 momentum increase broken confident look forward reductions crime rates years ahead serious crime largest cities actually reduced 13 percent 1971 1973 washington federal government special law enforcement responsibilities crime cut half since 1969 indictments convictions organized crime racketeers tripled since 1969 thanks large measure 1970 organized crime control act expanded federal interagency strike forces addition course riots urban terrorism burnings 1960s become thing past indications success mean slacken effort intensify key elements strategy require assistance congress include comprehensive reform federal criminal code last year submitted proposal based upon work justice department study completed national commission reform federal criminal laws federal criminal code completely revised quarter century need reform urgent call upon congress act expeditiously reforming criminal code make workable responsive demands complex society restoration death penalty federal criminal code several especially heinous specific crimes result death innocent victims examples crimes hijacking kidnapping bombing increased federal assistance state local law enforcement agencies next fiscal year propose funding law enforcement assistance administration 886 million 60 million 1969 increasing resources available attorneys offices throughout nation offices last three years increased number criminal convictions 28 percent creation additional federal judgeships assure speedier disposition criminal cases legislation accomplish goal congress comprehensive improvement federal correctional programs already 15 additional correctional institutions built acquired begun 1975 budget request would represent tripling 1969 budget levels new effort deal effectively employment problems caused increase number illegal aliens entering country legislation achieve objective also congress protecting right privacy one basic rights cherish america right privacy advance technology right increasingly threatened problem simply one setting effective curbs invasions privacy even fundamentally one limiting uses essentially private information put recognizing basic proprietary rights individual information concerning privacy course absolute may conflict example need pursue justice conflicts occur intelligent balance must struck one part current problem technology increased ability government private organizations gather disseminate information individuals safeguards needed protect privacy individuals communications kept pace another part problem clear definitions standards concerning right privacy developed agreed upon therefore ordered extensive review undertaken year government industry practices relate right privacy conflicts arise balances must struck legitimate needs information right privacy measures including appropriate taken ensure balances properly struck ending drug abuse decade increasing numbers americans including high percentage young people year turned heroin drugs search new highs synthetic solutions problems life retreat reality nation drug problem grew dramatically residents proudest cities gripped fear addicts turned crime support habits thousands families suffered devastating personal tragedies pleased able report since federal spending drug treatment enforcement increased tenfold progress made indeed turned corner hard drugs better drug law enforcement home abroad caused acute heroin shortage throughout much country enough treatment capacity created virtually addicts want medical help counselling get drug abuse indicators suggest last succeeded reducing total number heroin addicts number new addicts nevertheless drug battle far sake next generation determined keep pressure ensure heartening progress made date translated lasting victory heroin drugs enforcement efforts meet success one area world pressure increases trafficking routes meet new threats step support joint drug enforcement programs also directed plans increased vigilance borders put effect treatment area intensifying efforts encourage addicts undergo treatment provide added incentive motivated seek help directed federal agencies expand support local programs direct addicts charged crimes treatment pending trial sentencing continued progress also require help congress shortly recommend severe new penalties heroin traffickers engaged illegal distribution illicit drugs legislation supplement proposals currently pending congress psychotropic convention key international treaty regulating manufactured drugs worldwide 2 years still ratified affirmative action session utmost importance continue pursue balanced approach drug problem next year emphasizing vigorous law enforcement treatment rehabilitation programs help speed return productive lives society enhancing environment nation world made imposing strides recent years coping problems natural environment building upon concerns created institutions developed policies strategies deepened public understanding problems face us entering second phase environmental action may prove difficult period second phase looking environmental problems new ways complex accustomed must concerned clean air clean water wise land use also interaction environmental efforts need expand energy supplies maintain general prosperity facing tough new problems draw strength progress already made knowledge turning back general commitment preserve enhance environment live record past five years includes vigorous enforcement air quality legislation strengthened water quality pesticide control legislation enactment new authorities control noise ocean dumping regulations prevent oil spills ports waterways legislation establishing major new parks recreation wilderness areas also tried reorganize federal structure ways responsive environmental needs national environmental policy act passed 1969 provided basis reform federal agencies given citizens greater opportunity contribute environmental decisions 1970 established environmental protection agency national oceanic atmospheric administration provide coordinated vigorous environmental management also year appointed first council environmental quality producing results results vigorous efforts seen felt major cities levels dangerous sulfur oxides particulates declined pollutants automobiles reduced water pollution conquered assisted massive federal commitment 14 billion municipal treatment plants administration major misuses pesticides control major sources noise regulated first time five years federal agencies acquired additional acres preservation future generations many near heavily populated urban centers new york san francisco addition legacy parks program initiated 1971 made massive strides bringing parks people date 400 separate parcels covering almost acres federal lands 50 states turned state local governments park recreational use many near congested urban areas continue expedite transfer additional surplus properties state local governments park recreation use improving world environment small planet pollution knows boundaries world concern environment necessary encouraging many significant international actions taken recent years united states proud leadership actions included signing international conventions protect endangered species wildlife regulate ocean dumping extend national park concept world control marine pollution united nations environment program established last year un environment program fund came fulfilling proposal made 1972 environment agreement signed moscow may 1972 soviet american scientists environmentalists actively working together serious environmental problems challenge ahead part administration continuing effort conserve outdoor recreation areas new budget propose full funding land water conservation fund 1975 nearly aid state local governments acquiring recreation lands facilities coupled change proposed formula allocating funds states measure would encourage development recreational sites closer places people live work year unique opportunity responsibility determine future use enormous land areas america last great frontier alaska last month accordance alaska native claims settlement act transmitted congress recommendations would add million acres alaska national park national forest wildlife refuge wild scenic rivers systems alaska frontier thoughtlessly developed gone forever opportunity make considered judgments appropriate uses outstanding alaskan lands american people future generations session congress 17 major natural resources environment proposals previously submitted recommend action include department energy natural resources discuss new department elsewhere message want reemphasize consider cardinal importance ensuring complex interrelated environmental natural resource issues receive appropriately wide policy overview administrative coordination land use policy adoption national land use policy act first proposed 1971 remains high priority administration legislation would reaffirm basic responsibility land use decisions rests states localities would provide funds encourage meet responsibility pleased senate passed legislation incorporating policies proposed urge congress pass legislation would assist states localities inject federal government specific land use decisions coastal wetlands environmentally vital wetlands increasingly threatened development proposed environmental protection tax act would amend federal tax laws discourage unwise use areas enhance opportunities sound land use planning within coastal zone wilderness traditionally looked westward wilderness areas last year however proposed 16 eastern areas designated wilderness 37 others studied possible wilderness designation historic preservation irreplaceable historic architectural heritage proposed environmental protection tax act discourage demolition historic structures encourage rehabilitation big thicket national biological reserve big thicket area east texas biological crossroads unique united states gratified house acted urge senate promptly consider proposal preserve key segments thicket big thicket national biological reserve big cypress national fresh water reserve protection big cypress swamp florida essential preservation water supply everglades national park recommended legislation would authorize acquisition acres enabling us protect vital water supply public land management secretary interior needs additional authority protect environmental values public domain lands urge given authority controlling pollution three legislative proposals aimed controlling pollution yet received final congressional action toxic substances new chemicals unknown environmental effects come use year authority test substances restrict use event danger still permitting orderly marketing needed chemicals timely fashion highly desirable hazardous wastes disposal wastes land increasing due advances industry technology stringent controls air water pollution wastes hazardous human health forms life proposal provides national standards treatment disposal hazardous waste primary regulatory responsibility resting state governments safe drinking water water use homes endanger health proposal safe drinking water federal standards would provide health protection requiring strict limitation contaminants drinking water primary enforcement responsibilities would left states alternative legislation seriously considered congress would require unnecessary federal standards operating treatment plants generate domineering federal enforcement role create several new categorical subsidy programs community development although american communities share many challenges age relative intensity particular nature challenges vary sharply one community another current way providing federal aid communities dollar tied string pulled manipulated federal planner wrong much money pays federal planners could better spent local community decisions made planners could better made people live scene past years sought change old system recognized federal policy work best one helps people particular community define needs meet needs way consider best administration tried generous also tried grant communities greater freedom set priorities since 1969 spent twice much money community development programs federal government spent purpose entire previous history nation reduced red tape arbitrary restrictions local action much part programs past moved authority administering community development programs washington field administrators accessible local officials become familiar local problems stepped federal support state local planning management spending purpose spent previous years combined result cities received federal dollars able accomplish dollar despite progress need much sweeping reform possible existing laws therefore urge passage better communities act billion bill would give local officials new flexibility provide greater effectiveness expenditure federal community development funds legislation would consolidate seven categorical grant programs single program funds would distributed basis need local communities could decide projects come first thus could eliminate mountainous volume red tape allow local government play larger role determining destinies two congresses addressed community development legislation agreed part basic principles approaches better communities act represents still action cities towns counted legislation effect next fiscal year face uncertain future urge congress move ahead quickly possible better communities act pledge every effort work remaining differences cities towns benefit program soon possible also urged 93rd congress pass responsive government act submitted last year measure would enable state local officials improve planning managerial capabilities broadbased flexible grants rural development 12 billion invested rural development agriculture department programs alone five years administration annual federal funding rural development programs tripled time funds spent rural housing billion provided housing loans electrification telephone systems 3 billion spent bring service new rural consumers water waste disposal loans grants totaling billion provided rural communities water waste disposal systems loans farmers received loans totaling billion addition efforts department agriculture programs almost 200 federal programs significant impact rural areas result rural residents receive much federal support per capita residents urban areas past year markedly increased activity behalf nation rural residents 1973 rural development act funded first time provide 750 million loans grants states procedures give new flexibility promoting rural industrialization improving quality rural life interim rural housing policy developed placing greater emphasis effectively utilizing existing housing making farmers home administration programs responsive greatest housing needs ensure continuing government attention rural development needs administration also created special rural development committee new post assistant secretary agriculture rural development look future patterns national growth must never forget prosperity vitality character rural america essential cornerstones nation balanced growth essential rural america receive proper share attention determined shall case helping disaster victims seldom swift effective government action needed urgently natural disaster strikes since taking office declare 160 major disasters 42 states 3 territories recent years amount federal assistance given disaster victims greatly expanded also pressed intensive effort provide aid equitably expeditiously since 90 percent property damage resulting natural disasters caused floods especially pleased congress approval last year proposed flood disaster protection act significantly expands improves national flood insurance program remains done however meet basic humanitarian responsibility fall helpless innocent victims nature rampage therefore also proposed disaster preparedness assistance act places new emphasis essential element preparedness also increasing role state local officials allocating federal disaster funds cutting tangle red tape also provides automatic use federal resources major disasters strike includes generous grant features individual disaster victims unable repay government loans well communities faced task restoring damaged public facilities natural disasters continue strike certain uncertainty well prepared generous compassionate nation prepared give victims disasters prompt effective help desperately need better housing stated many times administration waver federal commitment first outlined housing act 1949 decent home suitable living environment every american family state america housing continue depend state america economy factor forces marketplace forces count sufficient real income sufficient confidence create effective demand better housing one hand builders credit institutions able respond demand federal government must play major supporting role actions mortgage credit market help low income families need assistance obtaining adequate housing last september credit housing becoming increasingly scarce administration acted make credit available home buyers recently mortgage market conditions begun improve however assure continuing improvement recently authorized reduction maximum allowable interest rate mortgages insured fha farmer home administration va 6 billion mortgage insurance program assist financing construction housing units actions favorable impact housing production anticipated results fully achieved recommend action ensure reasonable level production last five years substantial effort made address country housing problems largely general upswing economy housing production occurred record levels fha mortgage insurance enabled nearly 3 million families purchase homes two million units subsidized housing low moderate income families approved previous 33 years federally subsidized housing programs billion committed improving modernizing existing public housing subsidies local housing authorities grown 33 million 1969 350 million 1974 even good housing become reality americans clear important problems still exist two especially significant first credit institutions often encounter problems providing adequate housing credit second many low income families unable obtain adequate housing even good housing sits vacant community must help meet needs order increase availability housing families urge passage session two key measures already proposed financial institutions act enable savings loan associations compete effectively funds periods tight money well encourage increased investment housing tax credit income earned residential mortgages administration proposed housing act would ease present tight mortgage credit situation make home ownership easier long term authorizing increases permissible mortgage amounts eligible fha insurance permitting home buyers pay market interest rates fha va insured mortgages reducing cost buying home away present system charging points mortgage loans authorizing experimental basis flexible repayment plans fha insured mortgages authorizing flexible interest rates longer repayment terms higher amounts mobile homes home improvement loans legislation would extend authority extensive experiments new approach direct cash assistance addressing housing problem low income american families despite commitment 66 billion evidence clearly shown subsidized housing programs low income families worked well instead programs treat symptoms continue press longer term goes root sufficient income permits private housing market work efficient way possible additionally legislation would improve operation existing public housing projects helping move effective efficient basis operation improving transportation energy crisis made urgent seemed necessary building transportation system permits americans travel efficiently reasonable cost elements transportation system federal highway network dramatically improved expanded past decade others notably railroads fallen serious difficulties also apparent public transit system must greatly improved within urban centers measures already taken others shall propose session particularly important helping deal energy crisis encouraging sensible utilization transportation resources past four years several key measures helped lay basis greatly improved transportation system urban mass transportation act 1970 increased annual federal aid urban public transportation billion 1973 8 times level 1968 1973 another 3 billion made available years immediately ahead first time since world war ii downward trend transit ridership reversed moving upwards first time provisions highway act 1973 states localities use portion federal highway funds public transit purposes also improvement rail passenger service amtrak public corporation created rail passenger service act 1970 years steady decline rail passenger service past year saw 14 percent increase number passengers carried amtrak past year also went work avoid major rail crisis passage regional rail reorganization act 1973 provides restructuring bankrupt railroads northeast midwest region streamlined system 1976 hope affected railroads able operate profitably survive producers consumers tax revenues significant new initiatives also taken airport airway development making vitally needed improvements merchant marine promoting transportation safety especially nation highways clearly however still much done hope 1974 year make major advances enacting two critical transportation bills one proposals send congress near future would give communities money also freedom balance transportation needs mark largest federal commitment ever improvement public transportation bill would increase federal assistance metropolitan areas nearly 50 percent level fiscal year 1974 funds would allocated formula state local governments governments could better determine transportation priorities choosing construction highways public transit systems purchase buses rail cars additional transit aid would also made available rural communities first time bill resources would also available first time augment operating funds public transportation systems urban rural areas permitting federal resources used operating purposes proposal make unnecessary establish new categorical grant program transit operating subsidies contemplated bills congress second major transportation initiative year shall propose modernize regulatory system governing railroad operations legislation would make easier railroads consolidate service sustainable basis would make changes system rate regulation allow rail carriers compete effectively one another alternative modes freight transportation discriminatory state local taxation interstate carriers would barred would also provide 2 billion federal loan guarantee authority finance improvements terminal rail plant facilities rolling stock necessary would major step effort improve nation railroad system additional transportation measures shall soon propose include improvements highway safety earmarking approximately 250 million 1975 federal highway program elimination death traps highways example improving intersections replacing dangerous bridges new bonus grants states also initiated encourage adoption improved safety legislation reward states outstanding safety accomplishments restructuring airport airway financing system allocate costs equitably among users airways provide flexibility use funds district columbia last christmas eve signed new home rule bill law nation capital reached significant milestone voters district accept proposal forthcoming referendum city soon first elected mayor city council 100 years addition giving citizens nation capital right elect officials greater role decisions affecting local affairs act also transfers district functions carried federal agencies rightfully local control order accomplish transfer responsibilities local government much work done administration make every effort assist transfer ensure timely effective attention affairs district columbia captured transition home rule must ignore another important task us city moves new era must also prepare nation celebration bicentennial federal bicentennial task force working ensure federal government meets financial program commitments nation capital leadership bicentennial coordination center established two years ago number projects moving forward national visitors center constitution gardens eisenhower civic center fort circle parks national air space museum projects contribute enormously celebration takes place 1976 addition pennsylvania avenue development corporation soon present plan restore improve central historically important thoroughfare coming year also urge congress take action pending legislation create district columbia development bank would much broaden economic base district bicentennial near celebration america bicentennial officially begins march 1975 tempo preparations picked sound organizational framework established approval congress last year new american revolution bicentennial administration 50 states district columbia four territories also established bicentennial commission plan coordinate local bicentennial projects 370 counties cities towns villages tribal units recognized bicentennial communities 600 applications designation currently reviewed federal level created domestic council committee bicentennial committee approved goals federal participation bicentennial established interagency bicentennial task force approved 200 bicentennial projects departments agencies department interior complete development historically significant national park sites national foundation arts humanities support cultural activities relating bicentennial many national institutions smithsonian institution present special exhibitions across nation nations actively responding invitation world issued july 4 1972 participate us celebration alone one draws heritage every nation people come shores celebrating america bicentennial shall course commemorate national achievements shall honor celebrated leaders even remember whose contributions less well known shall take stock shortcomings resolve overcome celebrate 1976 vitality american people tried ensure federal bicentennial activities reflect diversity alone appearing community bicentennial planning across country culture communications took office 1969 determined give support goal substantially strengthening arts humanities united states result rapid growth national endowment arts national endowment existed low level activity current year national endowment arts spend million large scale programs intended enrich america cultural present future broad range individuals well institutions public private assisted special support given projects add celebration bicentennial congress past given strong bipartisan support arts endowment support needed future increased federal funds eliciting greater financial support private sector state local governments ensure flourishing american arts years ahead national endowment humanities likewise made outstanding contributions stimulation intellectual cultural life one measure growing importance activities fact humanities endowment program today ten times large five years ago humanities endowment also play major role promoting bicentennial emphasize activities reach large numbers people film television productions traveling exhibitions america television far best means communicating widest audience assure american audience greater range television programming type financially feasible commercial television dramatically increased support public television last five years public broadcasting matured past year television radio licensees reorganized way encouraged rational relationship corporation public broadcasting increased ability local station provide programs uniquely tailored local communities another aspect electronic media recently become public policy issue cable television development could lead vast expansion nation communications capabilities june 1971 established cabinet committee develop proposals comprehensive national policy cable communications recently received reviewing report product committee also asked director telecommunications policy prepare legislation move toward adoption implementation national cable television policy expect submit legislation congress near future encourage congress review carefully issues presented cable television especially encourage widespread national debate subject could play major role lives future science technology one great strengths nation preeminence science technology times national peril turned men women laboratories universities government private industry apply knowledge new challenges current energy crisis calling upon respond outlined recent energy message congress first step 10 billion research development effort energy billion direct energy r coming fiscal year additional 216 million supporting research total increase 80 percent year look broad scope energy effort tells great deal confidence capabilities nation scientists engineers calling accelerate development nuclear power systems determine use abundant supplies coal ways environmentally acceptable improve technology harnessing natural energy sources sun heat earth time asking explore new ways conserving energy already use everyday conveniences automobiles administration recognizes need progress every major area american life requires technological input therefore committed giving major programs broad scientific underpinning new budget call increase 20 percent civilian research development expenditures addition major increase energy research development funds spread across large number programs enhancing prosperity health americans science continue vital efforts fight drug abuse prevent infant mortality combat venereal disease aid treating mental illness call upon services scientists engineers design better forms transportation make safer transportation already examine ways making vast agricultural establishment yield food lower prices try lessen pollution attempt develop methods mining yield greater mineral wealth also give miner greater safety landscape greater protection study ways protect wildlife natural attack attempt learn protect violence nature form floods landslides earthquakes tornadoes natural calamities administration recognizes vital role social sciences must play america growth money made available studying social effects various government income distribution redistribution plans social security welfare benefits health insurance varied experimental educational forms every great area national endeavor administration see adequate funds making scientific progress spent also means continue important efforts space exploration space today making key contribution man understanding universe abilities manage resources earth wisely skylab astronauts proven space acceptable working environment man explore planetary system stars galaxies also using space technology monitor earth environment earth resources technology satellite allowing us search scarce resources high earth already many intercontinental communications satellite year new commercial satellites also used domestic telephone telegraph television services satellite weather forecasting commonplace result space efforts space exploration future become economical develop space shuttle reusable vehicle space transportation cooperative international aspect space program come european developed integral part shuttle program addition moving full speed ahead plans joint space venture soviets 1975 new federalism rapidly changing increasing demands placed upon government made necessary reorganize federal structure made even imperative make state local government stronger effective last four decades almost every major attempt government meet major social need resulted new national program administered washington new bureaucracy forty years ago federal employees today million last decade problem grown acute 1960 200 federal programs outlays 8 billion 1970 nearly total outlays risen 22 billion next fiscal year expect outlays programs reach 52 billion even substantial efforts cut number growth size power complexity made federal government increasingly inaccessible individual citizen seeks help many new national social programs actually impeded development effective local government creating federal categorical grant system staggering complexity diversity fostered state local level overlapping wasteful programs distorted budgets priorities additional administrative expense delay uncertainty diminution authority responsibilities state local elected officials federal grants become special province competing bureaucracies one basic new directions administration proposed 1969 create new fundamentally different relationship state local government one hand federal government new relationship come known new federalism said 1969 purposes restore states proper rights roles federal system new emphasis local responsiveness provide encouragement necessary resources local state officials exercise leadership solving problems narrow distance people government agencies dealing problems restore strength vigor state local governments elected officials know best needs priorities constituents shift balance political power away washington back country people help congress administration new relationship among local state federal governments begun take shape 1972 congress enacted general revenue sharing program already 11 billion new money put work units state local government funding law enforcement assistance program demonstrated flexibility new federalism leaving state local authorities decisions best combat crime jurisdictions program helped make america streets safer citizens comprehensive employment training act signed law 1973 landmark example new federalism broad flexible forms assistance represents leading example achieved executive congress team enact solid legislation new authorities rural development act exercised year way supportive state local development plans priorities addition within limits law moved administratively strengthen role state local governments simplifying streamlining federal grant systems including procedures state local review project proposals affecting jurisdictions opportunities grant integration joint funding decentralization many federal activities ten federal regional councils remaining three years term shall continue take every sound administrative action within authorities available support strengthen state local government must support congress maintain progress begun proposals furthering new federalism body urge support include federal education reforms consolidate support elementary secondary schools well vocational adult programs promote better planning local level advance funding better communities act replace several ineffective restrictive urban programs flexible approach would allow local officials make essential decisions way community development funds would spent responsive governments act provide needed federal assistance improving state local planning management capabilities would help strengthen capacity state local governments assume greater responsibility administration programs whether federally assisted disaster preparedness act increase role state local officials allocating federal disaster funds cut tangle federal red tape addition proposals pending number new initiatives describe elsewhere message also reflect principles new federalism include new public transportation initiative would permit states urban rural allocate highway mass transit funds accordance local conditions priorities economic adjustment assistance program would help states communities create employment opportunities affected structural changes economies brought persistent unemployment depressed incomes field health comprehensive health insurance plan would bring protection medical expenses within reach citizens making government work better taking office five years ago one first needs sought address organization executive branch government plain fact way government gets anything done organizational structure well perform depends large measure well organized needs nation continue change activities government must respond changes patterns government organization might fine 1930s even 1960s may hopelessly date 1970s therefore early first term established expert commission survey organization executive branch recommend improvements meet needs reports commission contributed significantly reorganizations ordered recommended including proposal put forward three years ago sweeping reorganization executive branch consolidating seven present cabinet departments four new units although basic restructuring enacted congress progress substantial nature made modernizing government example established united states postal service taking post office politics office management budget providing strong management arm assist coordinating functions executive branch restructured national security council domestic council coordinate domestic policy formulation council environmental quality environmental protection agency national oceanic atmospheric administration provide leadership meeting vital environmental needs special action office drug abuse prevention drug enforcement administration council economic policy facilitate formation execution overall economic policy council international economic policy focus area increasingly important foreign relations domestic economy action provide stronger coordination incentives volunteer activities cost living council help stabilize prices federal disaster assistance administration help individuals communities struck natural disasters reorganization steps designed meet specific need effectively respond newly urgent needs several accomplished reorganization plan authority available every president last 25 years expired last march authority utilized concurrence necessary order keep abreast changing needs urge reinstituted special concern today reorganization government meet energy crisis executive order already established federal energy office serve focal point energy actions taken government office lacks statutory base sufficient authority full job asked congress establish federal energy administration urge act matter recognizing country longer remain dependent upon foreign energy sources also urged creation energy research development administration develop necessary technology tap new domestic sources energy separate nuclear energy commission carry regulatory activities presently assigned atomic energy commission organizational initiatives needed best organization knit together future energy natural resource programs federal government would comprehensive department energy natural resources concept consistent major federal departmental reform submitted congress 1871 today urge swift favorable action congress proposal broad organizational base ultimately needed meet many energy needs effective manner balance energy natural resource considerations future consolidation reorganization executive branch proposed 1971 would also created new departments community development human resources economic affairs basic problems fractionated sometimes overlapping often conflicting organizations prompted original proposals remain acute today therefore urge congress join serious effort achieve effective reorganization areas view close relationship food assistance programs income security programs also propose new legislation transfer food stamp related programs department agriculture department health education welfare another important organizational proposal still awaiting congressional action creation independent legal service corporation administration work closely congress weeks ahead obtain final passage proposal would provide poor quality legal representation would create organization free political pressures would include safeguards ensure responsible operation legal services legislation already passed house hopeful reasonable legal services legislation passed senate major new opportunity better federal management initiated direction office management budget frequently termed management objective involves identification specific objectives year departments agencies year progress reaching objectives closely measured reported agency heads years ahead expect technique help make government responsive accountable nothing important improving efficiency government recruiting top flight personnel federal jobs including positions career civil service working months ahead ensure executive compensation career development training attract hold best possible personnel public service compensation provide top officials integral efforts recruit retain best men women government service salaries federal judges members congress heads assistant heads executive agencies adjusted 5 years time comparable pay rates private sector increased 30 percent pay federal employees increased significantly report commission executive legislative judicial salaries notes lag compensation also produces serious salary compression among top ranks career employees therefore recommending increase executive legislative judicial salaries budget rate 7 percent annually next three years make salaries within top levels federal government competitive industry help us make government work better campaign reform several years clear reforms needed way elect public officials intense public focus placed campaign abuses 1972 generated sufficient support issue opportunity make genuine breakthrough national radio address may 16 last year announced proposal commission campaign reform commission would reexamined entire federal election process come comprehensive set legislative recommendations commission would filed public report later december 1 1973 eight months passed since proposal submitted congress commission even close created created expeditiously would report recommending meaningful reforms federal campaigns originally hoped reforms might place prior 1974 elections light delay decided submit comprehensive set administration proposals campaign reform consideration congress session believe mine workable proposals hope lead meaningful debate reform critical area end look forward working congress effort clean federal election process america world administration took office apparent world changed fundamental ways america foreign policy change equally fundamental ways needed end military involvement vietnam war manner consistent responsibilities commitments major world power needed adjust changes strategic situation soviet union united states presented unique opportunity build solid foundation peace also threatened security foundation could built needed end quarter century hostile isolation kept world population outside framework international cooperation world could afford another generation hostility united states people republic china needed adjust partnerships western europe japan recognizing increasing political economic strength emphasizing important common goals needed alter world monetary system reflect new realities international economic system america place past five years made striking progress meeting needs continuing responsibility vietnam united states peace first time decade peace must something absence active engagement american forces conflict must guard tendency express relief military extrication southeast asia washing hands whole affair men women still dying still responsibility must provide ravaged lands economic assistance needed stabilize structures societies make future peace likely must provide well continued military aid grants required maintain strong defense forces continue insist full compliance terms agreements reached paris including full accounting men missing southeast asia building new relationships work detente reduce conflict areas world soviet union important interests must also continue work reduce potential causes conflict us must persevere negotiations soviet union place limits strategic arms competition talks warsaw pact nations reduce forces europe way increase security stability pursue relations soviet union climate detente established two years ago moscow reaffirmed general secretary brezhnev visit washington last year fateful weeks middle east war last october strength detente severely tested since american diplomatic leadership initiative played central role search final settlement long troubled middle east began october 22 worked soviet union assistance later strengthened agreement november consolidate geneva peace conference united states soviet recently agreement disengagement egyptian israeli military forces implemented cooperation united nations emergency force steps beginning broadened efforts find lasting settlement area problems process building normal relationship people republic china continues liaison offices established respective capitals continues fruitful contact governments high levels strengthening free world partnerships relationships old adversaries changing relationships old friends western europe japan put behind postwar struggle rebuild economies societies political force success endeavors something helped foster take pride times changed past role success sole basis continuing relationship must instead adjust relationships recognize new economic capacities international political objectives must accommodate within framework friendship goodwill allies whole past history cooperation pursuit common goals cornerstone structure peace seeking build closest neighbors western hemisphere shall continue seek additional ways working cooperatively solve problems face americas secretary state kissinger meeting weeks foreign ministers latin america begin new constructive dialogue family american states international trade commerce turn era confrontation one cooperation trade commerce become important moved position virtual economic hegemony world new role interdependent world economy must create equitable efficient system integrating economy rest world much already accomplished front markets ussr china accessible thereby providing jobs american workers major trading partners western europe japan share interest reducing international trade barriers increasing world trade rigid outmoded international monetary system dollar impeded foreign trade decisively altered two years trade deficits america achieved trade surplus 1973 must persevere international monetary investment trade negotiations greatest tasks still lie ahead stakes high avoiding economic political disruptions associated international monetary turmoil restrictive trade investment practices increases importance international interdependence grows noted earlier message prompt passage pending trade reform act essential achieving goal less restrictive equitable international economic system addition must move forward current negotiations reform international payments system auspices international monetary fund reforms markedly increase opportunities nations trade invest profitably must also strengthen resolve world prosperous nation help less fortunate countries world today nation fully secure prosperous nations past take pride efforts work developing nations aspire greater economic social united states called world food conference held november auspices united nations also actively observe 1974 world population year proclaimed united nations maintaining strong defense forge work must conscious opportunity build structure peace came arms served deterrent war must maintain deterrent last five years outlays department defense reduced measured constant dollars military personnel cut million million year recommend substantial increase 1975 budget department defense increases necessary improve readiness armed forces build levels essential equipment supplies preserve present force levels face rising costs conclusion throughout five years one overriding aim establish structure peace world free future generations scourge war others may different priorities remain first priority chief legacy hope leave eight years presidency strengthen peace must also continue year steady strengthening society home conscience requires interests require must insist create jobs build better health care system improve education develop new sources energy provide abundantly elderly poor strengthen system private enterprise produces prosperity solidify essential bonds hold us together nation even importantly advance final analysis government america freedom security better life one 211 million individual persons america afford neglect progress home pursuing peace abroad neither afford neglect peace abroad pursuing progress home stable peace possible without peace nothing possible earlier message comment one continuing challenges facing us legislative process timing pacing initiatives selecting year among many worthy projects ripe action time true terms domestic initiatives true also world period juncture historic forces unique century provide opportunity may never create structure peace solid enough last lifetime peace time peace children time well way respond opportunity anything else history judge whether america met responsibility full confidence meet responsibility richard nixon white house january 30 1974
enter 1974 begin historical cycle middle one beginning make many vital area beginning must build upon new need arisen process address opportunity coalesce give u chance make historic progress toward stable peace expand prosperity look agenda 1974 consider work one year isolation select task 1974 must build work year anticipate need ahead indeed one continue challenge face u legislative process time pace initiative would false pretend could afford everything would maintain nothing therefore must strive maintain steady progress select year among many worthy project ripe action time accommodate within constraint budget pressing ensure do clone discuss legislative recommendation congressional session therefore shall context advance already make problem remain special opportunity 1974 make progress start certain basic premise basic tax burden american taxpayer increase new initiative therefore scale prudently spend give level revenue would generate exist tax structure full utilization resource increase federal spending keep minimum budget flexible enough used necessary maintain job prosperity essential break old habit regard federal program establish permanent must learn scrap old program longer effective need favor new one way afford must do within guideline number major new initiative ripe action 1974 several milestone march life great freedom great opportunity great prosperity particular 1974 year first break back energy crisis also project independence lay foundation future capacity meet america energy need america resource reasonable price adequate environmental protection second take another giant stride toward last peace world continue policy negotiation rather confrontation great power concern also help toward achievement last settlement middle east third check rise price without administer harsh medicine recession move economy period steady growth sustainable level fourth establish new system comprehensive health insurance make high quality health care available every american dignified manner price afford fifth continue build new era achievement responsiveness state local government cut string tight federal control bound hand state local official community economic development program sixth make crucial breakthrough toward good transportation strengthen ability local community deal transportation problem seventh reform system federal aid education provide need need need eighth make historic begin task define protect right personal privacy ninth start new road toward reform welfare system bleed taxpayer corrodes community demean meant assist tenth together nation world establish economic framework within american share fully expand world trade prosperity year ahead open access market supply meet energy need start congressional session number one legislative concern must energy crisis cooperative effort american people together measure already take administration significantly reduce immediate impact energy crisis economic dislocation individual hardship minimize policy encourage broad conservation measure allocate scarce energy resource least possible harm job economy object keep farm factory produce keep worker job keep good service flow even mean must live work somewhat less comfortable surroundings drive few mile slow speed even full cooperation american however still face real challenge genuine shortages month year immediately ahead meet challenge must change pattern energy consumption production must press forward development reliable new energy source must adjust fact age unlimited supply cheap energy end immediate energy crisis begin oil embargo impose middle east last fall embargo hasten shortage already anticipate number year fuel consumption climb production domestic energy supply decline become heavily dependent oil import consequently vulnerable interruption reduction import well sudden increase foreign price today interruption supply face sharply increased price supply restore irrespective possibility restore flow middle east oil must act ensure never dependent foreign source supply energy need must continue slow rise rate consumption must sharply increase domestic production effect energy conservation felt already responsiveness american people recent crisis prove major factor help avoid serious consequence winter might bring conservation must continue required increase domestic supply achieve rapidly involve development entirely new source energy well expand development oil coal resource require significant expansion research development effort require shift use scarce fuel plentiful also expensive cheap energy accustom require encourage exploration production mean act prevent energy industry make unconscionable windfall profit must also avoid cripple industry punitive legislation finally require make difficult decision sort economic environmental priority seek act domestically increase fuel supply act internationally effort obtain oil reasonable price unreasonable increase cost vital commodity oil pose threat entire structure international economic relation job price income stake general pattern international cooperation stake well hope work cooperative effort friend abroad eau meet energy need without disrupt economy without disrupt economic relationship last week send congress comprehensive special message set forth energy situation energy prospect energy need legislative measure consider necessary meeting need shall repeat analysis full list recommendation today want urge however critical energy measure propose make first order legislative business session congress work go forward expeditiously others measure request give high priority follow special energy act would permit additional restriction energy consumption would postpone temporarily certain clean air act requirement power plant automotive emission windfall profit tax would prevent private profiteering expense public sacrifice unemployment insurance people area impact serious economic dislocation mandatory report major energy company inventory production reserve also ask congress quickly establish federal energy administration energy research development administration provide appropriate organizational structure administer national energy policy work toward establishment department energy natural resource 13 energy measure request last week deal need extend beyond present emergency also require expeditious action achieve goal project independence capacity energy 1980 success project independence essential continue strength position world trade also independence action great power hope joint effort resolve energy crisis move toward capacity energy enable president address 98th congress decade look back say make possible america enjoy continue peace prosperity 1980s nation economy world economy past three year united state reach unprecedented level material prosperity industrial output set new record trade flourish consumption rise high level history even inflation serious economic problem face one low industrialize free world major policy decision take 1971 contribute significantly prosperity country clear example move 1970s international monetary system adopt world war ii need major adjustment unsustainable imbalance develop threaten resurgence protectionism disruption world trade decide take strong measure august 1971 measure result major realignment world currency value progress toward new flexible international monetary management negotiation toward open equitable trading system adjustments essential easy finally enter flexible realistic international financial system much remain do complete transition beneficial result already clear realignment currency value help produce increase 80 percent 50 billion rate export past two year along major improvement trade balance improvement good u also rest world addition shock world economy arise reduce food supply 1972 1973 recent month oil embargo arbitrary increase price oil manage without panic new arrangement indeed world trade continue expand despite temporary difficulty international trade barrier vigorous international trade vital american economy job american worker depend ability develop foreign market moreover american consumer deserve access product might less expensive interesting unavailable united state trade advantageous long run must conduct basis fair participant still many unnecessary barrier trade need lower removed improvement make situation last 10 year need build progress negotiate open access market supply call upon congress special urgency complete action propose trade reform act order provide authority need negotiate effectively reduction barrier trade improve trading system manage trade problem home effectively senate considers legislation would draw attention particularly provision add house would seriously impede effort achieve harmonious international relationship provision would effectively prevent extension nondiscriminatory tariff treatment credit certain communist country unless followed policy allow unrestricted emigration convince prohibition would make difficult kind cooperative effort unite state government necessary work together peace middle east throughout world confident work congress find solution problem avoid major setback peacemaking effort time must move forward current negotiation reform international payment system auspices international monetary fund negotiation design increase opportunity nation trade invest profitably already present proposal deter growth significant imbalance international monetary affair preserve nation wide freedom choose necessary adjustment best accomplish addition system also accommodate increased payment flow prospective reserve accumulation occasion high oil price however nation share u preserve healthy grow world economy confident mutually acceptable solution problem achieve practice mean market must increasingly open import develop country condition would significantly facilitate enactment trade reform act also mean congress must continue authorize appropriate fair share bilateral multilateral economic assistance include substantial contribution international development association help poor country 1973 successfully negotiate reduction unite state share 40 percent ida fund let action house vote ida stand final answer work hard congress ensure country continue play leadership role consistent economic situation economic development continue plan orderly manner along trade monetary problem new international agreement investment policy new mechanism dispute settlement high negotiate agenda come year must continue work economic arrangement permit beneficial flow international investment may derive maximum benefit resource end glad able note week united state complete phaseout control flow capital country recent oil embargo especially arbitrary increase price oil create major economic problem many country include united state continue policy would require enormous transfer good asset oil import nation transfer would represent serious burden even wealthy country would virtually unbearable less developed country objective clear must get world oil price level arbitrary exploitative must also cooperate ensure international domestic economic policy advance country compound economic disturbance create current emergency rather do contain limit disturbances domestic economy despite general prosperity inflation remain serious economic problem unite state also rest world see clear evidence problem every hand world oil price go recently dramatic rate world food metal commodity price also sharply domestic price isolate international price worldwide inflationary pressure help drive price home inflation continuous problem nearly decade get bad 1973 result people come expect continue price increase behave accordingly economic life behavior turn add inflationary pressure contribute vicious inflationary spiral difficult break people say best way wring inflationary expectation economy take economy recession disagree true low level economic activity would reduce demand thus low pressure high price however cost policy term increase unemployment would simply unacceptable token also reject notion totally ignore inflation concentrate solely stimulate high level employment policy would also involve high cost since would unleash acceleration inflation rate develop economic policy 1974 chosen believe sound middle road cushion economic slowdown expect 1974 without provide additional stimulus inflation expect policy reduce rate inflation end year appear serious threat severe slowdown act promptly vigorously support economy cope challenge inflation must recognize clear lesson recent year direct control price wage help fight inflation limit useful life inevitably eventual effect create aggravate significant distortion production distribution accordingly continue watch situation closely pursue policy gradual selective decontrol except particularly troublesome area time federal program help reduce inflation increase supply scarce resource strengthen one key area look forward expand supply food new national farm policy encourage rather discourage output achieve record harvest 1973 another record harvest appear likely 1974 increase agricultural output sure way bring food price increase output new policy produce rapid inflation inevitable must tolerate regain control inflation however require patience persistence long course administration dedicate achieve objective confident help american people succeed another press economic major contributor energy crisis cost use fuel resource come exceed cost import 1960 become increasingly attractive u import oil petroleum product unfortunately grow dependence import make entire economy vulnerable outside force vulnerability test recent month even great vulnerability develop country western europe japan less developed country oil every american learn consequence vulnerability short fuel supply higher fuel price large extent flexible adaptable economy solve longer run energy problem normal working marketplace energy price reach somewhat high level bargain rate past conservation encourage domestic energy production expand one example normal market force work recent shift small car well gas mileage next year also expect see expansion coal production new output oil natural gas nevertheless still import oil need immediate future essential therefore seek reasonable price oil world market also imperative review current prospective supply basic commodity therefore direct comprehensive report policy analysis make concern crucial matter governmental action properly anticipate help avoid damaging shortage even inflation energy problem 1973 year many important economic gain american people first employment 1973 increase million person percent rise employment large since 1955 new job opportunity greatly benefitted category worker include woman teenager vietnam veteran unemployment reach low level especially skilled worker second purchase power american people reach new high last year even allow price increase people consume good service year ago year entire history united state everyone purchase power go course inflation take toll many family whose income rise fast average american reason continue regard inflation serious enemy time however ignore substantial economic gain make perspective 1974 known time slowdown economic growth inevitable 1974 clear economy simply grow unsustainable rate shortage skilled worker full utilization plant equipment key industry short supply number essential raw material provide clear indication rate growth would taper unfortunately mild slowdown anticipated 1974 threaten somewhat pronounced oil embargo result shortage oil price increase expect therefore early part year output rise little unemployment rise somewhat inflation high objective however turn situation around later year output rise rapidly unemployment stop rise decline rate inflation slow role federal budget budget recommend congress next week help u achieve goal period support economy resist major slowdown provide degree stimulation could accelerate inflation future event suggest change fiscal policy desirable promptly recommend appropriate change particular hesitate use stimulus fiscal policy become necessary preserve job face unexpected slackening economic activity fiscal year 1975 budget recommend total spending billion increase billion current year increase hold minimum level necessary nearly 90 percent increase unavoidable exist law budget increase relatively controllable outlay percent federal receipt reach 295 billion fiscal year 1975 increase 25 billion project budget deficit billion condition full employment however federal receipt would substantially high would instead moderate budget surplus federal budget remain essential tool fight inflation energy supply limitation experience price pressure create budget discipline still require noted satisfaction member congress also recognize need budgetary discipline work go forward establish systematic budgeting procedure congress devote considerable effort 1973 develop mechanism coordinate individual spending decision budget whole continue support effort although troubled extraneous amendment add measure achieve goal urge congress enact workable budget reform legislative session tax reform entire economy affect incentive investment embody tax law major step take reform tax law past five year much remain do since 1969 primarily tax reform act 1969 revenue act 1971 major change introduce make personal income tax system conform nearly contemporary standard fairness high level personal exemption low income allowance work free eight million low income family entire federal income tax burden difference tax liability single marry taxpayer also reduce result tax change individual income tax 25 billion less 1974 would old tax law save tax burden typical family 270 equivalent two weekly paycheck average worker look forward work congress next month simplify tax law also simplify tax form individual fill distribute income tax burden equitably last april secretary treasury present congress set administration proposal major fundamental tax reform include proposal establishment minimum taxable income one could avoid pay fair share tax burden establishment new rule tax income foreign source also limitation artificial accounting loss eliminate tax shelter urge congress consider administration tax reform proposal early year also concern excessive burden impose low income elderly family state local property tax deal problem propose refundable tax credit low income elderly person whose property tax exceed five percent income proposal would also provide equivalent relief low income elderly individual pay rent urge congress enact important proposal financial reform health economy depend upon efficient flexible private financial system commercial bank thrift institution credit union host institution individual comprise financial sector economy average family depend institution provide fair reliable return saving provide credit reasonable term need buy home automobile purchase occasion recently financial system work well occasion example mortgage lending difficult obtain large part problem result legislation regulation institutional arrangement suit early time obsolete remedy problem submit draft legislation last year reflect result careful study presidential commission government expert urge congress act promptly matter american family businessmen local government serve financial system suit economic condition 1970s administration also study competitive position foreign bank within country american bank abroad make sure discriminatory regulation prevent american bank financial institution business entitle follow result study considerable interest submit congress proposal result study seem desirable healthy agricultural economy abundance primary goal farm policy abundance guarantee low food price every american high income american farmer five year ago agriculture troubled industry government control reduce incentive production cost taxpayer 3 billion year farm subsidy design hold production farm income low billion long hour work farmer earn average income 26 percent nonfarm average farm family leave farm average rate year today picture dramatically alter farm market expand dramatically farm export set new record last four year become large single factor nation balance payment strengthen dollar international money market farm production reach new record level last three year new record harvest forthcoming 1974 billion tax dollar use go farm price support payment basic commodity every year reduce nearly zero farm income reach record level 1973 gap farm income nonfarm income close 26 7 percent net farm income billion billion make progress government regulation less one proudest achievements administration enactment agriculture consumer protection act 1973 place production decision belong farmer government primary challenge federal agricultural policy encourage great production agricultural mean income farmer great international trading benefit nation reasonable food price consumer therefore ask congress revamp program still require restrictive federal control production remain farm commodity especially rice peanut tobacco sugar extra long staple cotton enhance agricultural activity administration also promote soil water conservation practice consolidate location local office federal agricultural agricultural stabilization conservation service soil conservation service farmer home administration federal crop insurance corporation create agricultural service center local level make thing easy farmer less costly government place high priority direct agricultural research area assure plentiful agricultural good reasonable price maintain competitive advantage world agricultural production protect land direction secretary kissinger recently propose united nation convene world food conference concern make urgent acute food shortage many part world conference hold november 1974 prove particular importance american farmer whose extraordinary productivity make nation world lead food exporter whose prosperity continue increase help meet need hungry world farm policy must course address need farmer also consumer 1973 experienced period rapidly increase food price price level late 1973 appear head period increase food price least next month intention hold increase small possible rate executive action lift quota wheat import action take last week significant force battle high food price high production summer fall large 1974 harvest come market serve best possible damper high price economic security one significant legislative achievement 1973 enactment comprehensive employment training act ceta form manpower revenue share bill transfer federal government state localities significant control design operation program improve employability unemployed underemployed ceta landmark new federalism also landmark way well manpower program legislation state local government able use federal fund meet need devote special attention employment problem particular local example might arise certain area result present energy shortage new budget include additional 250 million ceta current fiscal year 350 million year begin july distribution area high unemployment overall request 2 billion fund training employment program come year proposal related economic security make congress last year urge action include establishment minimum vest funding fiduciary standard private pension program worker could great assurance receive pension expect deserve retire urge work together resolve speedily remain disagreement enact responsible legislation increase employee protection without burden employer extent exist plan jeopardized new one discourage extension state local government law forbid employment discrimination old worker improvement unemployment insurance program several way increase state limit keep unemployed worker receive reasonable proportion normal wage extend coverage farmworkers prohibit payment benefit striker assure benefit unemployed result strike general improvement unemployment insurance augment special extension present benefit specific area country experience particularly high level unemployment next 12 month addition basic coverage provide area present unemployment insurance submit special legislation achieve purpose also continue support legislation raise minimum wage high price erode purchase power worker receive current minimum wage must careful guard enact bill include sharp increase coverage extension would keep low income worker employ bill minimum wage youth high unwittingly deny job finally must attack one troublesome problem face rural urban area existence persistent often severe unemployment low income area whose character alter change economy technology within next several week propose economic adjustment assistance program help state community overcome problem cause structural change economy program would replace present economic development administration regional action plan commission period orderly transition income security one measure nation character respect accord elderly another way help need proud effort make time reassess direction take future take pride fact cash benefit social security rise 26 billion fiscal year 1969 63 billion fiscal year 1975 primarily result five benefit increase total almost 70 percent reach 19 million person program supplemental security income initiate soon provide benefit 5 million age blind disabled uniform nationwide basis way respect dignity income security program need improve benefit past year multitude federally funded program grow whose primary purpose income security need effort reflect humane attempt respond worthy goal however cash service program rapidly expand past year two thing become painfully clear first result extremely costly set generally unrelated uncoordinated program many unintended undesirable consequence second effort neither efficiently equitably accomplish overall objective assist low income family individual achieve great economic independence fact third new federal budget 100 billion spent income security program fiscal year 1975 compare 38 billion budget receive five year ago highlight need rationalize integrate income assistance program long ago 1969 call complete overhaul discredit welfare program say whether measure anguish poor drastically mount burden taxpayer present welfare system judge colossal failure time propose family assistance plan neither congress country accept proposal intend resubmit new version family assistance plan since make concerted effort improve administration exist program 1973 first time recent year vigorous new federal state initiative enforce rule strictly growth aid family dependent child case load halt overall impact welfare program remain failure outrage example failure recent study show fully 40 percent afdc benefit pay either go ineligible person incorrect amount performance result fraud although primarily overwhelmingly result system complex riddle obscure obsolete incomprehensible regulation defies fair efficient administration plan make major new effort replace current maze welfare program system work task difficult alternative save waste live dollar welcome evidence thoughtful member congress careful study reach conclusion effort go forward make every possible effort improve operation exist program administrative reform recognize replacement system develop enact put operation overnight unless move urgently development new system effort improve administration present program wilt eventually undermined basic structural flaw development proposal guide five principle 1 american able work find rewarding work go welfare american would strongly prefer good job rather federal handout provide cash assistance need must always encourage complete capable 2 cash assistance people need federal government people federal government know need best 3 need focus federal help need people need receive equal treatment federal government regardless place residence 4 new system simple possible administer rule clear understandable base objective criterion rather personal judgment administer official efficient 5 new approach require increase tax burden u much income u go support government help one certainly weaken free enterprise system even high taxation start basic principle believe develop new system would ensure help help would allow help live dignity improve people health february 1971 outline congress new national health strategy assure american would deny access high quality medical care inability pay much already accomplish toward meet objective little two year ago take special satisfaction sign law national cancer act enable u launch accelerate effort conquer dread disease considerable progress make attack cancer much hope additional knowledge develop future budget submit congress next monday plan ask additional 100 million last year request 500 million expanded attack cancer addition biomedical research area include heart disease intensify total 1975 budget biomedical research exceed 2 billion double total fiscal year 1969 also make headway toward increase nation supply health manpower last ten year first year medical school enrollment grow 55 percent number health professional also expect grow dramatically last month approve legislation along line request 1971 permit federal government support demonstration health maintenance organization across nation 1974 1975 125 million provide health maintenance organization demonstrate benefit prepay health care citizens federal program finance health service age disable low income person greatly expand since 1969 medicare medicaid coverage extend additional 21 million age disabled american range service cover medicare medicaid also increase consumer safety program assure safe food drug cosmetic consumer product receive almost fourfold increase federal funding since 1969 despite advance however many american still fail receive need health care cost often cost health care threaten citizen bankruptcy service prevent cure disease fully utilize one major new initiative 1974 shall soon submit congress comprehensive health insurance proposal would make available health insurance protection million americans currently obtain afford private health insurance coverage need provide american vastly improve protection catastrophic illness place new emphasis preventive health care provide state federal subsidy family whose special health risk would otherwise make uninsurable insurable exorbitant expense comprehensive health insurance proposal build upon strength exist health system rather destroy maintain high quality medical care without require high tax base partnership paternalism importantly require doctor work patient federal government plan would require employer offer comprehensive health insurance plan employee employer pay share cost role private health insurance financing health care would expand consumer opportunity choose compete health insurance plan would enhance addition plan number measure urge congress enact year include health resource plan act help state locality improve plan use health resource new expand national health service scholarship legislation increase number federal scholarship available student health profession also help ensure federal government meet need physicians general expansion guarantee student loan program provide adequate financial assistance professional graduate student include health professional improve education federal government provide strong leadership assure equal access high quality education americans bring renewal reform education program since 1969 raise federal spending education billion billion increase 76 percent special message congress education past set forth five major proposal improve american education new program student assistance help ensure first time nation history qualify person bar attend college lack money national institute education focal point educational research development aim increase knowledge help student learn national foundation high education encourage innovation learn beyond high school emergency school aid program assist desegregate school district thorough reform program federal support elementary secondary education consolidate myriad separate categorical grant program order transfer educational decision back state local level belong first four basic proposal enact whole part great deal already accomplish fifth reform federal funding elementary secondary education believe 1974 year enactment college student assistance basic educational opportunity grant program primary vehicle effort ensure qualified student deny college education lack fund new budget ask congressional approval strengthen program providing grant year needy student altogether combine student funding effort federal government come fiscal year would provide estimate billion financial aid student increase 900 million level five year ago since present student assistance program target help needy cost high education rise dramatically many middle income student find increasingly difficult make end meet therefore also recommend limit total borrowing increase professional graduate student able find adequate student loan educational research development originally propose creation national institute education suggest provide equal opportunity quality education mean part increase knowledge way student learn change way teach long followed belief big educational program necessarily well educational program money alone solve educational problem begin see quality think education important size educational budget national institute education help u marshal educational resource way produce best result already begin provide kind leadership educational research development long believe need educational innovation beyond high school national foundation high education propose 1970 establish fund improvement education set congress fund provide support development demonstration effective approach college level education initial assessment lead believe fund year come become primary focal point innovation high education assist school desegregation emergency school aid act 1972 estimate 467 million federal fund provide local school district end 1975 assist process elementary secondary school desegregation encourage voluntary program overcome minority group isolation assist meet educational need child racial isolation equal educational opportunity school year bulk problem incident de jure segregation pass however provide assistance school district may still require take special desegregation measure result court ruling budget additional 75 million fiscal year 1975 addition federal government continue provide civil right education advisory activity local district assist meeting remain problem bus often opposition use force busing purpose achieve racial balance also propose legislation would dictate reasonable limit use force bus oppose consolidation school district effort achieve racial balance large district consolidation plan lead bus eventual disappearance neighborhood school end result excessive reliance force bus imposition arbitrary ratio frequently increase concentration poor minority central city serious weaken school system must serve case education minority child actually suffer benefitted plan shall continue support passage legislation make bus last resort tightly circumscribe even also continue work congress revise proposal light unfold event area funding elementary secondary education encourage interest congress continue show legislation follow concept put forward propose well school act believe meaningful compromise possible last reform consolidate federal grant elementary secondary education vocational program adult education hope congress include four basic element reform consolidation exist categorical grant program grant great authority state local educational agency great equity distribution federal fund state education disadvantage child reform impact aid program concentrate support district federal presence substantially decrease tax base rather increase tax base upon enactment legislative authority accomplish goal elementary secondary education vocational program adult education propose special supplemental appropriation provide fund school year funding would place elementary secondary education grant program forward fund basis let state local agency know much receive plan next school year make forward fund important concept finance education merit full support federal government note message send congress education policy last week also recommend additional support several educational old new include additional increase aid black college develop institution fiscal year 1975 thus quadruple federal fund important educational institution since take office continuation extension head start program single large child development program 1975 head start reach disadvantage youths well extend activity include handicap youth consolidation eight separate authority education handicap four broader flexible program school remain firmly commit principle educational diversity continue health nation school essential concept although governmental effort aim support school encounter difficulty court believe must continue effort find way keep school open reason continue support legislation permit tax credit parent pay send child school help veteran million american live today give military service country group veterans among productive citizen study show generally high income education good health age proud veteran contribution must also concerned veteran veteran family remain need assistance provide veteran family recent year substantial total compensation payment veteran disable killed military service increase billion 1969 billion come fiscal year medical care va hospital clinic greatly improve expand ten new replacement hospital service five preparation educational benefit per trainee double since 1969 last year two key measure one expand health care improve national cemetery system veteran pass sign law vital importance unemployment rate vietnam era veteran slice 11 percent early 1871 4 percent late 1973 result vietnam era veterans high employment rate others age significant achievement well deserve earlier week special message congress propose additional legislation help veteran two crucial area 1974 pension education pension proposal would benefit million veteran million veteran survivor economic need disability age loss breadwinner va pension already go long way toward meet needs pension structure fraught inequity anomalies technical nature tragic consequence proposal would correct deficiency veteran train require additional help gi bill allowance keep pace rise cost shall therefore propose gi bill benefit raise average 8 percent also set 1974 goal government place additional million veteran job job training remain sizable number educationally disadvantage veteran veteran never take advantage federal training opportunity unemployed directed matter high priority federal government effort reach veteran intensify counsel encourage use available service equal opportunity american administration make determined effort secure equal opportunity previously deny opportunity personally proud success effort already achieve committed building success future progress minority group member racial minority group make considerable stride toward equal opportunity recent year follow among notable benchmark progress set example equal opportunity employer past five year federal government add minority group member civilian employee role arm force 850 cadet enrol military academy whereas prior 1971 four minority group member ever achieve general flag rank arm force sixteen serve active duty general admirals federal aid minority business enterprises one cornerstone administration effort open new economic horizon minority group nearly triple since 1970 civil right enforcement activity continue vigorous level funding substantially increase since 1969 combined federal expenditure civil right activity minority economic development program grow less 1 billion billion five year ago 68 percent black child south still attend school figure reduce 8 percent dual school system virtually eliminated government also seek expand job opportunity legal action may engage discriminatory practice 1972 1973 department justice initiate 34 pattern practice lawsuit approximately 207 defendant suit directly cover employee period time approximately 37 case fully resolve entry decree additional six partially resolve entry decree decree enter two year alone cover employee provide specific goal hire minority woman traditionally white male job addition decree provide new transfer seniority right approximately minority woman provide back pay award estimate amount well real story lie figure fact attitudes represent represent flamboyant promise rather quiet determination work toward symbol also toward substance equal opportunity represent effort build foundation last particular foundation economic independence basic faith equal dignity mankind justice american indians many year american first american last american receive right opportunity entitle administration take initiative change picture part federal government must put behind role autocratic manager indian reservation shall continue encourage indian tribal government play increase role determine future also particularly determine defend natural resource right indian people last five year historic step federal indian policy 1971 work closely indian leader achieve settlement alaska native claim settlement consistent america sense fairness also indispensable growth development alaska also return land take away long ago taos pueblo blue lake return land wrongfully take yakima people menominee people see tribal state involuntarily terminate nevertheless keep land tribal structure together congress enact sign bill restore menominee tribe trust status court forcefully assert indian natural resource right do protect indian right pyramid lake one measure attempt foster well humane policy level federal funding benefit american indian twice five year ago billion especially encourage fact rate infant death pneumonia influenza tuberculosis significantly low among indian ever although yet achieve full goal health educational service indian people fully compatible general population progress demonstrate continue commitment congress share accomplishment spirit bipartisan cooperation hope soon desk two enactment congressional action progress measure speed indian economic development upgrade position commissioner indian affair assistant secretary level also still await congressional action four proposal submit previously permit turn indian tribal government management control indian program create indian trust counsel authority safeguard indian natural resource right help ensure fund indian education actually reach indian child provide great local control federally assist reservation program program tribal grant look forward shall ask bureau indian affair make specific plan accelerate transfer significant portion program indian tribal management although repeat assurance accelerate transfer force indian tribe willing accept citizen nation face special problem obtain equal opportunity language cultural barrier reason administration make special effort expand opportunity progress front reflect many way nearly spanish surnamed american employ federal government despite overall reduction federal job small business administration also increase loan hispanic businessmen reach total 109 million fiscal year 1973 1969 cabinet committee opportunity people create cabinet committee make government aware need talent citizen help expand federal employment since authorization organization expire year ask congress extend life june 30 1975 cabinet committee opportunity serve focus administration continue effort important area concern right woman men woman become increasingly aware pattern sometimes blatant often subtle discrimination woman subject discrimination erase exist law require new law would rectify equal right amendment near ratification require state hope equal right amendment ratify speedily equal justice law become reality every american one primary goal administration ensure full equal employment opportunity woman strive open woman job previously reserve men often simply habit custom specifically move vigorously enforce law lead example insist equal employment promotion opportunity within federal service promote woman professionally critical area middle management continue special recruit drive bring woman high level government help advance goal appoint first woman counsellor president turn set new office woman program within executive office particularly proud administration first woman head three independent federal agency atomic energy commission federal maritime commission unite state tariff commission effort improve economic status woman outside government also continue equal employment opportunity commission give enforcement power federal court report marked increase activity end sex discrimination employment continue pursue effort vigor emphasis especially appropriate approach 1975 declare international woman year unite nation one especially invidious form sex discrimination particular ripe correction new legislation discrimination often deny woman equal access credit economy increasingly operate credit particularly grievous practice congress already proposal ensure credit extended person equitable basis without regard sex marital status administration strongly support proposal send congress amendment believe strengthen even urge prompt consideration passage vital legislation protection crime invasion privacy past five year higher domestic priority roll back tide crime violence rise 1960s therefore especially pleased progress make front 17 year continuous often dramatic increase crime 1972 register first overall decline although 1973 register slight increase still hold level 1971 momentum increase broken confident look forward reduction crime rate year ahead serious crime large city actually reduce 13 percent 1971 1973 washington federal government special law enforcement responsibility crime cut half since 1969 indictment conviction organize crime racketeer triple since 1969 thanks large measure 1970 organize crime control act expand federal interagency strike force addition course riots urban terrorism burning 1960s become thing past indication success mean slacken effort intensify key element strategy require assistance congress include comprehensive reform federal criminal code last year submit proposal base upon work justice department study complete national commission reform federal criminal law federal criminal code completely revised quarter century need reform urgent call upon congress act expeditiously reform criminal code make workable responsive demand complex society restoration death penalty federal criminal code several especially heinous specific crime result death innocent victim examples crime hijack kidnap bomb increase federal assistance state local law enforcement agency next fiscal year propose funding law enforcement assistance administration 886 million 60 million 1969 increase resource available attorney office throughout nation office last three year increase number criminal conviction 28 percent creation additional federal judgeship assure speedy disposition criminal case legislation accomplish goal congress comprehensive improvement federal correctional program already 15 additional correctional institution build acquire begin 1975 budget request would represent triple 1969 budget level new effort deal effectively employment problem cause increase number illegal alien enter country legislation achieve objective also congress protect right privacy one basic right cherish america right privacy advance technology right increasingly threaten problem simply one set effective curb invasion privacy even fundamentally one limiting use essentially private information put recognize basic proprietary right individual information concern privacy course absolute may conflict example need pursue justice conflict occur intelligent balance must strike one part current problem technology increase ability government private organization gather disseminate information individual safeguard need protect privacy individual communication keep pace another part problem clear definition standard concern right privacy develop agree upon therefore ordered extensive review undertaken year government industry practice relate right privacy conflict arise balance must strike legitimate need information right privacy measure include appropriate take ensure balance properly strike end drug abuse decade increase number american include high percentage young people year turn heroin drug search new high synthetic solution problem life retreat reality nation drug problem grow dramatically resident proudest city grip fear addict turn crime support habit thousand family suffer devastate personal tragedy please able report since federal spending drug treatment enforcement increase tenfold progress make indeed turned corner hard drug well drug law enforcement home abroad cause acute heroin shortage throughout much country enough treatment capacity create virtually addict want medical help counsel get drug abuse indicator suggest last succeed reduce total number heroin addict number new addict nevertheless drug battle far sake next generation determine keep pressure ensure hearten progress make date translate lasting victory heroin drug enforcement effort meet success one area world pressure increase traffic route meet new threat step support joint drug enforcement program also direct plan increase vigilance border put effect treatment area intensify effort encourage addict undergo treatment provide add incentive motivate seek help direct federal agency expand support local program direct addict charge crime treatment pending trial sentence continued progress also require help congress shortly recommend severe new penalty heroin trafficker engage illegal distribution illicit drug legislation supplement proposal currently pending congress psychotropic convention key international treaty regulating manufacture drug worldwide 2 year still ratify affirmative action session utmost importance continue pursue balance approach drug problem next year emphasize vigorous law enforcement treatment rehabilitation program help speed return productive life society enhance environment nation world make impose strides recent year cop problem natural environment build upon concern create institution develop policy strategy deepen public understanding problem face u enter second phase environmental action may prove difficult period second phase look environmental problem new way complex accustom must concern clean air clean water wise land use also interaction environmental effort need expand energy supply maintain general prosperity face tough new problem draw strength progress already make knowledge turn back general commitment preserve enhance environment live record past five year include vigorous enforcement air quality legislation strengthen water quality pesticide control legislation enactment new authority control noise ocean dump regulation prevent oil spill port waterway legislation establish major new park recreation wilderness area also try reorganize federal structure way responsive environmental need national environmental policy act pass 1969 provided basis reform federal agency give citizen great opportunity contribute environmental decision 1970 establish environmental protection agency national oceanic atmospheric administration provide coordinate vigorous environmental management also year appoint first council environmental quality produce result result vigorous effort see felt major city level dangerous sulfur oxides particulate decline pollutant automobile reduce water pollution conquer assisted massive federal commitment 14 billion municipal treatment plant administration major misuse pesticide control major source noise regulate first time five year federal agency acquire additional acre preservation future generation many near heavily populate urban center new york san francisco addition legacy park program initiated 1971 make massive stride bring parks people date 400 separate parcel cover almost acres federal land 50 state turn state local government park recreational use many near congested urban area continue expedite transfer additional surplus property state local government park recreation use improve world environment small planet pollution know boundary world concern environment necessary encourage many significant international action take recent year united state proud leadership action include sign international convention protect endanger specie wildlife regulate ocean dump extend national park concept world control marine pollution unite nation environment program establish last year un environment program fund come fulfil proposal make 1972 environment agreement sign moscow may 1972 soviet american scientist environmentalist actively work together serious environmental problem challenge ahead part administration continue effort conserve outdoor recreation area new budget propose full funding land water conservation fund 1975 nearly aid state local government acquire recreation land facility couple change propose formula allocate fund state measure would encourage development recreational site closer place people live work year unique opportunity responsibility determine future use enormous land area america last great frontier alaska last month accordance alaska native claim settlement act transmit congress recommendation would add million acre alaska national park national forest wildlife refuge wild scenic river system alaska frontier thoughtlessly develop go forever opportunity make consider judgment appropriate us outstanding alaskan land american people future generation session congress 17 major natural resource environment proposal previously submit recommend action include department energy natural resource discuss new department elsewhere message want reemphasize consider cardinal importance ensure complex interrelate environmental natural resource issue receive appropriately wide policy overview administrative coordination land use policy adoption national land use policy act first proposed 1971 remain high priority administration legislation would reaffirm basic responsibility land use decision rest state locality would provide fund encourage meet responsibility please senate pass legislation incorporate policy propose urge congress pas legislation would assist state locality inject federal government specific land use decision coastal wetland environmentally vital wetland increasingly threaten development propose environmental protection tax act would amend federal tax law discourage unwise use area enhance opportunity sound land use planning within coastal zone wilderness traditionally look westward wilderness area last year however propose 16 eastern area designate wilderness 37 others study possible wilderness designation historic preservation irreplaceable historic architectural heritage propose environmental protection tax act discourage demolition historic structure encourage rehabilitation big thicket national biological reserve big thicket area east texas biological crossroad unique united state gratify house act urge senate promptly consider proposal preserve key segment thicket big thicket national biological reserve big cypress national fresh water reserve protection big cypress swamp florida essential preservation water supply everglades national park recommend legislation would authorize acquisition acre enable u protect vital water supply public land management secretary interior need additional authority protect environmental value public domain lands urge give authority control pollution three legislative proposal aim control pollution yet receive final congressional action toxic substances new chemical unknown environmental effect come use year authority test substance restrict use event danger still permit orderly marketing needed chemical timely fashion highly desirable hazardous waste disposal waste land increase due advance industry technology stringent control air water pollution waste hazardous human health form life proposal provide national standard treatment disposal hazardous waste primary regulatory responsibility rest state government safe drinking water water use home endanger health proposal safe drinking water federal standard would provide health protection require strict limitation contaminant drink water primary enforcement responsibility would leave state alternative legislation seriously consider congress would require unnecessary federal standard operate treatment plant generate domineer federal enforcement role create several new categorical subsidy program community development although american community share many challenge age relative intensity particular nature challenge vary sharply one community another current way provide federal aid community dollar tie string pull manipulated federal planner wrong much money pay federal planner could better spent local community decision make planner could better make people live scene past year seek change old system recognize federal policy work best one help people particular community define need meet needs way consider best administration try generous also try grant community great freedom set priority since 1969 spent twice much money community development program federal government spend purpose entire previous history nation reduce red tape arbitrary restriction local action much part program past move authority administer community development program washington field administrator accessible local official become familiar local problem step federal support state local planning management spending purpose spend previous year combine result city receive federal dollar able accomplish dollar despite progress need much sweeping reform possible exist law therefore urge passage well community act billion bill would give local official new flexibility provide great effectiveness expenditure federal community development fund legislation would consolidate seven categorical grant program single program fund would distribute basis need local community could decide project come first thus could eliminate mountainous volume red tape allow local government play large role determine destiny two congress address community development legislation agree part basic principle approach good community act represent still action city towns count legislation effect next fiscal year face uncertain future urge congress move ahead quickly possible good community act pledge every effort work remain difference city towns benefit program soon possible also urge 93rd congress pas responsive government act submit last year measure would enable state local official improve plan managerial capability broadbased flexible grant rural development 12 billion invested rural development agriculture department program alone five year administration annual federal funding rural development program triple time fund spent rural housing billion provide housing loan electrification telephone system 3 billion spent bring service new rural consumer water waste disposal loan grant total billion provided rural community water waste disposal system loan farmer receive loan total billion addition effort department agriculture program almost 200 federal program significant impact rural area result rural resident receive much federal support per caput resident urban area past year markedly increase activity behalf nation rural resident 1973 rural development act fund first time provide 750 million loan grant state procedure give new flexibility promote rural industrialization improve quality rural life interim rural housing policy develop place great emphasis effectively utilize exist housing make farmer home administration program responsive great housing need ensure continue government attention rural development need administration also create special rural development committee new post assistant secretary agriculture rural development look future pattern national growth must never forget prosperity vitality character rural america essential cornerstone nation balance growth essential rural america receive proper share attention determine shall case help disaster victim seldom swift effective government action need urgently natural disaster strike since take office declare 160 major disaster 42 state 3 territory recent year amount federal assistance give disaster victim greatly expand also press intensive effort provide aid equitably expeditiously since 90 percent property damage result natural disaster cause flood especially pleased congress approval last year propose flood disaster protection act significantly expand improves national flood insurance program remain do however meet basic humanitarian responsibility fall helpless innocent victim nature rampage therefore also propose disaster preparedness assistance act place new emphasis essential element preparedness also increase role state local official allocate federal disaster fund cut tangle red tape also provide automatic use federal resource major disaster strike include generous grant feature individual disaster victim unable repay government loan well community face task restore damage public facility natural disaster continue strike certain uncertainty well prepared generous compassionate nation prepare give victim disaster prompt effective help desperately need good housing state many time administration waver federal commitment first outline housing act 1949 decent home suitable living environment every american family state america housing continue depend state america economy factor force marketplace force count sufficient real income sufficient confidence create effective demand well housing one hand builder credit institution able respond demand federal government must play major support role action mortgage credit market help low income family need assistance obtain adequate housing last september credit housing become increasingly scarce administration act make credit available home buyer recently mortgage market condition begin improve however assure continue improvement recently authorize reduction maximum allowable interest rate mortgage insure fha farmer home administration va 6 billion mortgage insurance program assist finance construction housing unit action favorable impact housing production anticipate result fully achieve recommend action ensure reasonable level production last five year substantial effort make address country housing problem largely general upswing economy housing production occur record level fha mortgage insurance enable nearly 3 million family purchase home two million unit subsidize housing low moderate income family approve previous 33 year federally subsidize housing program billion commit improve modernize exist public housing subsidy local housing authority grow 33 million 1969 350 million 1974 even good housing become reality americans clear important problem still exist two especially significant first credit institution often encounter problem provide adequate housing credit second many low income family unable obtain adequate housing even good housing sits vacant community must help meet needs order increase availability housing family urge passage session two key measure already propose financial institution act enable saving loan association compete effectively fund period tight money well encourage increase investment housing tax credit income earn residential mortgage administration propose housing act would ease present tight mortgage credit situation make home ownership easy long term authorize increase permissible mortgage amount eligible fha insurance permit home buyer pay market interest rate fha va insured mortgage reduce cost buying home away present system charge point mortgage loan authorize experimental basis flexible repayment plan fha insured mortgage authorize flexible interest rate longer repayment term higher amount mobile home home improvement loan legislation would extend authority extensive experiment new approach direct cash assistance address housing problem low income american family despite commitment 66 billion evidence clearly show subsidized housing program low income family work well instead program treat symptom continue press long term go root sufficient income permit private housing market work efficient way possible additionally legislation would improve operation exist public housing project help move effective efficient basis operation improve transportation energy crisis make urgent seem necessary building transportation system permit american travel efficiently reasonable cost element transportation system federal highway network dramatically improve expand past decade others notably railroad fall serious difficulty also apparent public transit system must greatly improve within urban center measure already take others shall propose session particularly important help deal energy crisis encourage sensible utilization transportation resource past four year several key measure help lay basis greatly improve transportation system urban mass transportation act 1970 increase annual federal aid urban public transportation billion 1973 8 time level 1968 1973 another 3 billion make available year immediately ahead first time since world war ii downward trend transit ridership reverse move upwards first time provision highway act 1973 state locality use portion federal highway fund public transit purpose also improvement rail passenger service amtrak public corporation create rail passenger service act 1970 year steady decline rail passenger service past year saw 14 percent increase number passenger carry amtrak past year also go work avoid major rail crisis passage regional rail reorganization act 1973 provide restructure bankrupt railroad northeast midwest region streamline system 1976 hope affect railroad able operate profitably survive producer consumer tax revenue significant new initiative also take airport airway development make vitally need improvement merchant marine promote transportation safety especially nation highway clearly however still much do hope 1974 year make major advance enact two critical transportation bill one proposal send congress near future would give community money also freedom balance transportation need mark large federal commitment ever improvement public transportation bill would increase federal assistance metropolitan area nearly 50 percent level fiscal year 1974 fund would allocate formula state local government government could better determine transportation priority choose construction highways public transit system purchase bus rail car additional transit aid would also make available rural community first time bill resource would also available first time augment operate fund public transportation system urban rural area permit federal resource use operate purpose proposal make unnecessary establish new categorical grant program transit operate subsidy contemplate bill congress second major transportation initiative year shall propose modernize regulatory system govern railroad operation legislation would make easy railroad consolidate service sustainable basis would make change system rate regulation allow rail carrier compete effectively one another alternative mode freight transportation discriminatory state local taxation interstate carrier would bar would also provide 2 billion federal loan guarantee authority finance improvement terminal rail plant facility roll stock necessary would major step effort improve nation railroad system additional transportation measure shall soon propose include improvement highway safety earmark approximately 250 million 1975 federal highway program elimination death trap highways example improve intersection replace dangerous bridge new bonus grant state also initiate encourage adoption improve safety legislation reward state outstanding safety accomplishment restructure airport airway financing system allocate cost equitably among user airway provide flexibility use fund district columbia last christmas eve sign new home rule bill law nation capital reach significant milestone voter district accept proposal forthcoming referendum city soon first elect mayor city council 100 year addition give citizen nation capital right elect official great role decision affect local affair act also transfer district function carry federal agency rightfully local control order accomplish transfer responsibility local government much work do administration make every effort assist transfer ensure timely effective attention affair district columbia capture transition home rule must ignore another important task u city move new era must also prepare nation celebration bicentennial federal bicentennial task force work ensure federal government meet financial program commitment nation capital leadership bicentennial coordination center establish two year ago number project move forward national visitor center constitution garden eisenhower civic center fort circle park national air space museum project contribute enormously celebration take place 1976 addition pennsylvania avenue development corporation soon present plan restore improve central historically important thoroughfare come year also urge congress take action pending legislation create district columbia development bank would much broaden economic base district bicentennial near celebration america bicentennial officially begin march 1975 tempo preparation pick sound organizational framework establish approval congress last year new american revolution bicentennial administration 50 state district columbia four territory also establish bicentennial commission plan coordinate local bicentennial project 370 county city town village tribal unit recognize bicentennial community 600 application designation currently review federal level create domestic council committee bicentennial committee approve goal federal participation bicentennial establish interagency bicentennial task force approve 200 bicentennial project department agency department interior complete development historically significant national park sit national foundation art humanity support cultural activity relate bicentennial many national institution smithsonian institution present special exhibition across nation nation actively respond invitation world issue july 4 1972 participate u celebration alone one draws heritage every nation people come shore celebrate america bicentennial shall course commemorate national achievement shall honor celebrated leader even remember whose contribution less well know shall take stock shortcoming resolve overcome celebrate 1976 vitality american people tried ensure federal bicentennial activity reflect diversity alone appear community bicentennial planning across country culture communication take office 1969 determine give support goal substantially strengthen art humanity united state result rapid growth national endowment art national endowment exist low level activity current year national endowment art spend million large scale program intend enrich america cultural present future broad range individual well institution public private assist special support give project add celebration bicentennial congress past give strong bipartisan support art endowment support need future increase federal fund elicit great financial support private sector state local government ensure flourish american art year ahead national endowment humanity likewise make outstanding contribution stimulation intellectual cultural life one measure grow importance activity fact humanity endowment program today ten time large five year ago humanity endowment also play major role promote bicentennial emphasize activity reach large number people film television production travel exhibition america television far best mean communicate wide audience assure american audience great range television program type financially feasible commercial television dramatically increase support public television last five year public broadcasting mature past year television radio licensee reorganize way encourage rational relationship corporation public broadcasting increase ability local station provide program uniquely tailor local community another aspect electronic medium recently become public policy issue cable television development could lead vast expansion nation communication capability june 1971 establish cabinet committee develop proposal comprehensive national policy cable communication recently receive reviewing report product committee also ask director telecommunication policy prepare legislation move toward adoption implementation national cable television policy expect submit legislation congress near future encourage congress review carefully issue present cable television especially encourage widespread national debate subject could play major role live future science technology one great strengths nation preeminence science technology time national peril turn men woman laboratory universities government private industry apply knowledge new challenge current energy crisis call upon respond outline recent energy message congress first step 10 billion research development effort energy billion direct energy r come fiscal year additional 216 million support research total increase 80 percent year look broad scope energy effort tell great deal confidence capability nation scientist engineer call accelerate development nuclear power system determine use abundant supply coal way environmentally acceptable improve technology harness natural energy source sun heat earth time ask explore new way conserve energy already use everyday convenience automobile administration recognize need progress every major area american life require technological input therefore commit give major program broad scientific underpin new budget call increase 20 percent civilian research development expenditures addition major increase energy research development fund spread across large number program enhance prosperity health american science continue vital effort fight drug abuse prevent infant mortality combat venereal disease aid treat mental illness call upon service scientist engineer design good form transportation make safe transportation already examine way make vast agricultural establishment yield food low price try lessen pollution attempt develop method mine yield great mineral wealth also give miner great safety landscape great protection study way protect wildlife natural attack attempt learn protect violence nature form flood landslides earthquake tornado natural calamity administration recognize vital role social science must play america growth money make available study social effect various government income distribution redistribution plan social security welfare benefit health insurance vary experimental educational form every great area national endeavor administration see adequate fund make scientific progress spent also mean continue important effort space exploration space today make key contribution man understand universe ability manage resource earth wisely skylab astronaut proven space acceptable work environment man explore planetary system star galaxy also use space technology monitor earth environment earth resource technology satellite allow u search scarce resource high earth already many intercontinental communication satellite year new commercial satellite also use domestic telephone telegraph television service satellite weather forecasting commonplace result space effort space exploration future become economical develop space shuttle reusable vehicle space transportation cooperative international aspect space program come european develop integral part shuttle program addition move full speed ahead plan joint space venture soviet 1975 new federalism rapidly change increase demand place upon government make necessary reorganize federal structure make even imperative make state local government stronger effective last four decade almost every major attempt government meet major social need result new national program administer washington new bureaucracy forty year ago federal employee today million last decade problem grow acute 1960 200 federal program outlays 8 billion 1970 nearly total outlay rise 22 billion next fiscal year expect outlay program reach 52 billion even substantial effort cut number growth size power complexity make federal government increasingly inaccessible individual citizen seek help many new national social program actually impede development effective local government create federal categorical grant system stagger complexity diversity foster state local level overlap wasteful program distort budget priority additional administrative expense delay uncertainty diminution authority responsibility state local elect official federal grant become special province compete bureaucracy one basic new direction administration propose 1969 create new fundamentally different relationship state local government one hand federal government new relationship come know new federalism say 1969 purpose restore state proper right roles federal system new emphasis local responsiveness provide encouragement necessary resource local state official exercise leadership solve problem narrow distance people government agency deal problem restore strength vigor state local government elect official know best needs priority constituent shift balance political power away washington back country people help congress administration new relationship among local state federal government begin take shape 1972 congress enact general revenue share program already 11 billion new money put work unit state local government funding law enforcement assistance program demonstrate flexibility new federalism leave state local authority decision best combat crime jurisdiction program help make america street safer citizen comprehensive employment training act sign law 1973 landmark example new federalism broad flexible form assistance represent lead example achieve executive congress team enact solid legislation new authority rural development act exercise year way supportive state local development plan priority addition within limit law move administratively strengthen role state local government simplify streamline federal grant system include procedure state local review project proposal affect jurisdiction opportunity grant integration joint funding decentralization many federal activity ten federal regional council remain three year term shall continue take every sound administrative action within authority available support strengthen state local government must support congress maintain progress begin proposal further new federalism body urge support include federal education reform consolidate support elementary secondary school well vocational adult program promote well plan local level advance funding well community act replace several ineffective restrictive urban program flexible approach would allow local official make essential decision way community development fund would spend responsive government act provide need federal assistance improve state local planning management capability would help strengthen capacity state local government assume great responsibility administration program whether federally assist disaster preparedness act increase role state local official allocate federal disaster fund cut tangle federal red tape addition proposal pending number new initiative describe elsewhere message also reflect principle new federalism include new public transportation initiative would permit state urban rural allocate highway mass transit fund accordance local condition priority economic adjustment assistance program would help state community create employment opportunity affect structural change economy bring persistent unemployment depress income field health comprehensive health insurance plan would bring protection medical expense within reach citizen make government work well take office five year ago one first need sought address organization executive branch government plain fact way government get anything do organizational structure well perform depend large measure well organize need nation continue change activity government must respond change patterns government organization might fine 1930s even 1960s may hopelessly date 1970s therefore early first term establish expert commission survey organization executive branch recommend improvement meet need report commission contribute significantly reorganization order recommend include proposal put forward three year ago sweep reorganization executive branch consolidate seven present cabinet department four new unit although basic restructuring enact congress progress substantial nature make modernizing government example establish united state postal service take post office politics office management budget provide strong management arm assist coordinate function executive branch restructure national security council domestic council coordinate domestic policy formulation council environmental quality environmental protection agency national oceanic atmospheric administration provide leadership meeting vital environmental need special action office drug abuse prevention drug enforcement administration council economic policy facilitate formation execution overall economic policy council international economic policy focus area increasingly important foreign relation domestic economy action provide strong coordination incentive volunteer activity cost living council help stabilize price federal disaster assistance administration help individual community strike natural disaster reorganization step design meet specific need effectively respond newly urgent need several accomplish reorganization plan authority available every president last 25 year expire last march authority utilized concurrence necessary order keep abreast change need urge reinstituted special concern today reorganization government meet energy crisis executive order already establish federal energy office serve focal point energy action take government office lack statutory base sufficient authority full job ask congress establish federal energy administration urge act matter recognize country longer remain dependent upon foreign energy source also urge creation energy research development administration develop necessary technology tap new domestic source energy separate nuclear energy commission carry regulatory activity presently assign atomic energy commission organizational initiative need best organization knit together future energy natural resource program federal government would comprehensive department energy natural resource concept consistent major federal departmental reform submit congress 1871 today urge swift favorable action congress proposal broad organizational base ultimately need meet many energy need effective manner balance energy natural resource consideration future consolidation reorganization executive branch propose 1971 would also create new department community development human resource economic affair basic problem fractionate sometimes overlap often conflict organization prompt original proposal remain acute today therefore urge congress join serious effort achieve effective reorganization area view close relationship food assistance program income security program also propose new legislation transfer food stamp relate program department agriculture department health education welfare another important organizational proposal still await congressional action creation independent legal service corporation administration work closely congress week ahead obtain final passage proposal would provide poor quality legal representation would create organization free political pressure would include safeguard ensure responsible operation legal service legislation already pass house hopeful reasonable legal service legislation pass senate major new opportunity well federal management initiate direction office management budget frequently term management objective involve identification specific objective year department agency year progress reach objective closely measure report agency head year ahead expect technique help make government responsive accountable nothing important improve efficiency government recruit top flight personnel federal job include position career civil service work month ahead ensure executive compensation career development training attract hold best possible personnel public service compensation provide top official integral effort recruit retain best men woman government service salaries federal judge member congress head assistant head executive agency adjust 5 year time comparable pay rate private sector increase 30 percent pay federal employee increase significantly report commission executive legislative judicial salary note lag compensation also produce serious salary compression among top rank career employee therefore recommend increase executive legislative judicial salary budget rate 7 percent annually next three year make salary within top level federal government competitive industry help u make government work well campaign reform several year clear reform need way elect public official intense public focus place campaign abuse 1972 generate sufficient support issue opportunity make genuine breakthrough national radio address may 16 last year announce proposal commission campaign reform commission would reexamine entire federal election process come comprehensive set legislative recommendation commission would file public report later december 1 1973 eight month pass since proposal submit congress commission even close create create expeditiously would report recommend meaningful reform federal campaign originally hop reform might place prior 1974 election light delay decide submit comprehensive set administration proposal campaign reform consideration congress session believe mine workable proposal hope lead meaningful debate reform critical area end look forward work congress effort clean federal election process america world administration take office apparent world change fundamental way america foreign policy change equally fundamental way need end military involvement vietnam war manner consistent responsibility commitment major world power need adjust change strategic situation soviet union united state present unique opportunity build solid foundation peace also threaten security foundation could build needed end quarter century hostile isolation keep world population outside framework international cooperation world could afford another generation hostility united state people republic china need adjust partnership western europe japan recognize increase political economic strength emphasize important common goal need alter world monetary system reflect new reality international economic system america place past five year make strike progress meeting need continue responsibility vietnam united state peace first time decade peace must something absence active engagement american force conflict must guard tendency express relief military extrication southeast asia wash hand whole affair men woman still die still responsibility must provide ravage land economic assistance need stabilize structure society make future peace likely must provide well continued military aid grant require maintain strong defense force continue insist full compliance term agreement reach paris include full accounting men miss southeast asia build new relationship work detente reduce conflict area world soviet union important interest must also continue work reduce potential cause conflict u must persevere negotiation soviet union place limit strategic arm competition talk warsaw pact nation reduce force europe way increase security stability pursue relation soviet union climate detente establish two year ago moscow reaffirm general secretary brezhnev visit washington last year fateful week middle east war last october strength detente severely test since american diplomatic leadership initiative played central role search final settlement long troubled middle east begin october 22 work soviet union assistance later strengthen agreement november consolidate geneva peace conference united state soviet recently agreement disengagement egyptian israeli military force implement cooperation united nation emergency force step begin broaden effort find lasting settlement area problem process build normal relationship people republic china continue liaison office establish respective capital continue fruitful contact government high level strengthen free world partnership relationships old adversary change relationship old friend western europe japan put behind postwar struggle rebuild economy societies political force success endeavor something help foster take pride time change past role success sole basis continue relationship must instead adjust relationship recognize new economic capacity international political objective must accommodate within framework friendship goodwill ally whole past history cooperation pursuit common goal cornerstone structure peace seek build close neighbor western hemisphere shall continue seek additional way work cooperatively solve problem face americas secretary state kissinger meeting week foreign minister latin america begin new constructive dialogue family american state international trade commerce turn era confrontation one cooperation trade commerce become important move position virtual economic hegemony world new role interdependent world economy must create equitable efficient system integrate economy rest world much already accomplish front market ussr china accessible thereby provide job american worker major trade partner western europe japan share interest reduce international trade barrier increase world trade rigid outmode international monetary system dollar impede foreign trade decisively alter two year trade deficit america achieve trade surplus 1973 must persevere international monetary investment trade negotiation greatest task still lie ahead stake high avoid economic political disruption associate international monetary turmoil restrictive trade investment practice increase importance international interdependence grows note early message prompt passage pending trade reform act essential achieve goal less restrictive equitable international economic system addition must move forward current negotiation reform international payment system auspices international monetary fund reform markedly increase opportunity nation trade invest profitably must also strengthen resolve world prosperous nation help less fortunate country world today nation fully secure prosperous nation past take pride effort work develop nation aspire great economic social united state call world food conference hold november auspex united nation also actively observe 1974 world population year proclaim united nation maintain strong defense forge work must conscious opportunity build structure peace come arm serve deterrent war must maintain deterrent last five year outlays department defense reduce measure constant dollar military personnel cut million million year recommend substantial increase 1975 budget department defense increase necessary improve readiness arm force build level essential equipment supply preserve present force level face rise cost conclusion throughout five year one override aim establish structure peace world free future generation scourge war others may different priority remain first priority chief legacy hope leave eight year presidency strengthen peace must also continue year steady strengthen society home conscience require interest require must insist create job build good health care system improve education develop new source energy provide abundantly elderly poor strengthen system private enterprise produce prosperity solidify essential bond hold u together nation even importantly advance final analysis government america freedom security well life one 211 million individual person america afford neglect progress home pursue peace abroad neither afford neglect peace abroad pursue progress home stable peace possible without peace nothing possible early message comment one continue challenge face u legislative process time pace initiative select year among many worthy project ripe action time true term domestic initiative true also world period juncture historic force unique century provide opportunity may never create structure peace solid enough last lifetime peace time peace child time well way respond opportunity anything else history judge whether america meet responsibility full confidence meet responsibility richard nixon white house january 30 1974