Tonight's State of the Union Address concentrates on this year's highest priorities—a strong energy bill; a coordinated economic program of job creation, tax reduction, tax reform and anti-inflation measures; making the government more effective and efficient; maintaining the peace through a strong national defense; and ratifying both the Panama Canal Treaties and, if completed, the SALT II treaty. It is important that the Congress and the Nation also understand what our other important initiatives and goals will be for 1978. I am therefore sending to Congress this separate, more detailed State of the Union Message, which describes Administration priorities in the areas not fully covered in the Address. DOMESTIC AFFAIRS A number of serious domestic problems faced the Nation when I took office one year ago. The economy had not yet fully recovered from the recession; our country had no sound energy policy; the Federal government was operating inefficiently and ineffectively in many areas; concerns about the openness and integrity of our government remained in the aftermath of Watergate; and many of our most pressing social problems had not been addressed. In 1977, my Administration did not solve all of those problems. But Congress joined us in tackling many of these issues, and together we made progress. Now that a year has passed, I believe we are a more confident people, with more trust in our institutions. We are a country on the move again, prepared to address our problems with boldness and confidence, at home and abroad. We have reasserted our concern for the problems of people here at home and reaffirmed our position of moral leadership in the world. This year, my domestic goals will continue to reflect those concerns that guided my actions in 1977: restoring economic prosperity; meeting our Nation's human needs; making the government more efficient and more responsive; and developing and protecting our natural resources. RESTORING ECONOMIC PROSPERITY I am devoting a substantial part of my State of the Union Address to the need for a comprehensive economic program, and I will devote the bulk of my Economic Report to Congress, to be delivered tomorrow, to a complete description of my Administration's economic goals and objectives. In this Message, therefore, I will not repeat those statements but I want to set forth briefly the key elements of those proposals: —a $23 billion income tax cut in 1979, with $17 billion going to individuals and their families and $6 billion going to businesses; 
—a tax reform program designed to make our tax laws fairer and simpler; —an anti-inflation program, designed to reduce annual increases in wages and prices, with the cooperation of labor and business and with the Federal government setting an example; reductions of $2 billion in excise and payroll taxes will also make a contribution to reducing inflation; 
—an extension of the funding for 725,000 public service (CETA) jobs, and a $700 million increase in spending for our youth employment efforts; 
—a major new $400 million private sector jobs initiative, designed primarily to encourage businesses to hire unemployed minorities and youth. I plan to work very closely with Congress to secure prompt action on these economic proposals. Their adoption will help achieve the kind of economic prosperity for our Nation that all of us want. Along with a sound energy bill, enactment of these economic proposals will be my highest domestic priority for 1978. ENERGY There can be no higher priority than prompt enactment of comprehensive energy legislation along the lines submitted to the Congress last spring. Huge oil price increases in 1973-74 contributed to the double-digit inflation of 1974, and to the worst recession in 40 years. These price hikes were also the principal cause of our foreign trade deficit, which has contributed to the weakness of the dollar abroad. Unless we act now, our energy problems will rapidly get worse. Failure to act will fuel inflation, erode the value of the dollar, render us vulnerable to disruptions in our oil supply, and limit our economic progress in the years to come. I am confident that the Congress will respond to the Nation's clear need, by enacting responsible and balanced energy legislation early this year. EMPLOYMENT Last year we made considerable progress in our efforts to reduce unemployment. The unemployment rate decreased from 7.8% to 6.4%. During the year, 4.1 million new jobs were created. Unemployment fell by 1.1 million workers. The actions we took as part of our $21 billion economic stimulus package substantially helped us achieve these favorable results. In 1978, the Administration will continue its efforts to reduce unemployment still further and to increase employment opportunities for all Americans. As part of the budget I will propose: 
—additional funds to increase youth programs 260% above the 1976 level, providing $2.3 billion in outlays and 450,000 man-years of employment and training for young workers; 
—a $400 million private sector employment program focused on youth and other disadvantaged workers and aimed at mobilizing private industry to work with government in finding jobs. It will be implemented through business councils established throughout the country; 
—maintenance of the 725,000 CETA jobs through 1979, while tying them in future years to national unemployment rates; beginning of a demonstration program for the jobs component of the Better Jobs and Income Program. Humphrey-Hawkins Legislation The Administration will seek passage of the Humphrey-Hawkins Full Employment and Balanced Growth Act. This Act will help the Administration and the Congress in planning our efforts to reduce unemployment and to create jobs, while maintaining reasonable price stability. Its enactment would serve as a living memorial to the late Senator Hubert Humphrey. Private Sector Jobs The Administration plans a major $400 million effort to involve business and labor in the training and hiring of the hard-core unemployed. The program will closely tie the Federal employment system with the private sector, through the use of business councils. I am confident that the private sector will respond positively to the call to help the Nation solve one of its most serious problems the employment of our youth and minorities. INFLATION Although inflation is lower now than in the recent past, we still must do more to keep it down. The steps my Administration will take include: 
—incentives for business investment, contained in our tax proposals, which will increase productive investment, and thereby help us hold down prices and costs; 
—reduction in excise and unemployment taxes, proposed in the new budget; 
—continuing reductions in needlessly complex Federal regulations. We have established a high-level interagency committee to review the effects of regulation in our economy, and we will continue our efforts for regulatory reform in the airline industry and elsewhere; 
—a special effort to hold down the soaring costs of health care, through enactment of the Hospital Cost Containment Act. But the government cannot solve this problem alone especially once business, labor, and consumers have accel)ted inflation as a fact of life, and adjusted their behavior accordingly. I have therefore asked business and labor to undertake, voluntarily, a new program to reduce inflation. I will ask each industry to aim for smaller price and wage increases in 1978 than it averaged over the last two years. As a major employer the Federal government should take the lead in this effort. Voluntary cooperation is one way—perhaps the only way—to reduce inflation without unacceptable government interference and coercion. URBAN ASSISTANCE AND COMMUNITY DEVELOPMENT The Administration and Congress took major steps last year to meet the needs of our cities. We increased funding for Community Development Block Grants by $2.7 billion over three years, and provided an alternative formula for allocating funds that was more responsive to the needs of distressed urban areas. Next year we will recommend an increase of $150 million over the 1978 level for the Community Development Block Grant program. We enacted a new program of Urban Development Action Grants at an annual level of $400 million, and extended and expanded Anti-Recession Fiscal Assistance (ARFA). I am proposing that the ARFA program, which expires September 30, 1978, be extended. We are evaluating possible revisions in programs and funding, and will make our recommendations to the Congress within two months. The Administration is also studying closely the possible need for extended Federal lending to New York City. The current legislation expires on June 30, 1978. We are committed, along with the State and City, to preserving the City's solvency. If such extended lending is necessary for that purpose, we will propose it. However, all the interested parties must contribute to a permanent solution. This spring I will submit to Congress a message outlining this Administration's urban policy, based on the work of the Urban and Regional Policy Group, chaired by the Secretary of Housing and Urban Development. It will be designed to make existing Federal programs more effective, and will involve new initiatives and resources to address our urban needs. The long-standing problems of our cities are structural in nature and cannot be corrected by short-term or one-time efforts. This Administration is committed to a long-term and continuing effort to meet stubborn problems and changing needs. Our urban policy proposals will: —build a more effective partnership between the Federal government, State and local governments, the private sector, neighborhood groups and concerned citizens; —be sufficiently flexible to meet the diverse needs of our urban areas and to respond to particular problems of distressed areas; 
—address the fiscal needs of hardpressed urban governments, as well as the economic and social needs of city residents; 
—improve the urban physical environment and strengthen urban communities; 
—use Federal assistance to stimulate job-creating investments by the private sector and to encourage innovative actions by the State and local governments. AGRICULTURE AND RURAL DEVELOPMENT Decent farm income and a strong family farm system are vital to our national economic stability and strength. For too long farm prices for many commodities have been severely depressed. Working with the Congress in the past year, we have adopted new programs and policies designed to strengthen farm income and to ensure abundant, reasonably priced food for consumers. Partially as a result of these policies and programs, farm prices are now improving. Nevertheless, we cannot be satisfied with the economic condition of many American farmers today. We will continue to monitor our agricultural economy and to work with Congressional and farm leaders to make certain that Federal programs and policies are carried out effectively. Food and Agriculture Act In the past year we have worked with the Congress to enact a new comprehensive Food and Agriculture Act, which will protect producers and consumers. We have also exercised set-aside authority for wheat and feed grains, which will protect farm income. This year we expect to pay farmers $7.3 billion for all price support programs. The new farm bill which became effective October 1, 1977, achieves long-needed changes in our agricultural policies, including: 
—minimal governmental intervention in markets and in the decisions farmers make; 
—price support loans for major commodities that permit us to remain competitive in world markets; 
—a grain reserve designed to remove excess products from the market and hold them until supplies are short; —income support levels based on cost- of-production. Grain Reserve Last year we initiated a plan to place 30-35 million metric tons of food and feed grains in reserve. Establishing this reserve will add further strength and stability to the market and provide a hedge against export control on grain. Most of this grain will be owned and controlled by farmers. To strengthen farmer control of the grain and to help keep the grain out of government ownership, terms of the farmer storage facility loan program were liberalized. In 1978, the Administration will propose an international emergency grain reserve of up to 6 million metric tons to help us meet our food aid commitments abroad. Agricultural Disaster and Drought Aid Because of the record droughts in 1977, I worked with Congress to pass an $844 million Emergency Drought Assistance Program. This year we will ask Congress to eliminate the many inconsistencies and inequities in existing disaster aid programs, and we will continue to give high priority to addressing the effects of the drought, which has begun to abate. We are taking other steps to improve life in rural America. I recently signed a law to encourage better delivery of health services in rural communities. We will continue to expand the assignment of the National Health Service Corps' doctors, dentists and other health professionals to underserved rural areas. We will shortly be announcing methods to improve the effectiveness of rural housing programs with greater emphasis on home ownership for rural Americans. Agricultural Exports I want to increase our agricultural exports. To do so we need competitive prices, high quality products, and reserve supplies to meet all contingencies. We must remove unnecessary barriers to exports. And we must have an affirmative export policy. In 1977, the Administration more than doubled (to $1.7 billion) the short-term export credit program, increased Soviet grain purchase authorization to 15 millions tons, developed a risk assurance program, and expanded efforts to develop export markets around the world. This year we will continue these efforts, especially to reduce barriers to agricultural trade. Sugar To stabilize world sugar prices and to protect domestic sugar-producers, we negotiated an international sugar agreement this year with the major sugar producing countries. We will seek Congressional ratification of the agreement early in 1978. The sugar program required by the 1977 Food and Agricultural Act will protect the domestic sugar industry in the meantime. Rural Development and Credit Policy In fiscal year 1977, the Farmers Home Administration provided nearly $7 billion in loans in four areas: farming, housing, community facilities and business and industrial development. We expect to provide at least $1 billion more in the current fiscal year. SMALL BUSINESS This Administration took several steps in 1977 to strengthen small business. The Small Business Administration expanded its financial and management assistance to these firms and developed an advocacy program to represent small business interests before all Federal departments and agencies. In 1978, we will continue efforts to support small business through tax cuts and special tax incentives, reduced regulations and other programmatic reforms, and expanded SBA loan authority. MEETING OUR NATION'S HUMAN NEEDS This Administration's constant concern has been with meeting the human needs of all Americans. Over the past year, we have moved on a number of fronts to make certain our citizens will be well housed, better educated, and properly cared for when they are in need. This year we will pursue our current initiatives in these areas and launch new ones. HEALTH This past year we were very active in the effort to improve the health of our citizens and to restrain skyrocketing health care costs, through: 
—Establishment of a Mental Health Commission to help develop a national mental health program. The Commission will issue its final report later this year, and I expect to carefully consider the Commission's findings. 
—A campaign to immunize the more than 20 million children not yet protected against communicable childhood diseases. 
—Reorganization of part of HEW to allow more efficient delivery of Medicare/Medicaid services. The cost savings from the reorganizations will be realized more fully this year. 
—Signing legislation to attack fraud and abuse in Medicare/Medicaid programs. 
—Signing legislation to make Medicare/Medicaid reimbursement available to physician extenders in rural clinics. The beneficial effects of that bill will be felt in our Nation's rural areas for the first time this year. In 1978, the Administration will continue these and other efforts to bring us better and less costly health care. Hospital Cost Containment One of my main legislative goals for this year is the Hospital Cost Containment Bill. That bill, which would save hospital users more than $7 billion in the first two years after enactment, is our principal weapon in the effort to decrease health care costs, which now double every five years. National Health Insurance I will submit to Congress later this year a National Health Insurance proposal. While Congress will not have the time to complete action on this proposal in 1978, it is important to begin the national debate on the many complex issues involved in National Health Insurance. National Health Insurance will not solve all our health problems. A sensible national health policy also requires more effective delivery of preventive services, better nutrition, vigorous abatement of environmental and occupational threats to health, and efforts to change individual lifestyles that endanger health. But National Health Insurance is a crucial step. It will protect our people from ruinous medical bills and provide each citizen with better access to sound and balanced health insurance coverage. Medicaid Improvements for Children Last year I proposed the Child Health Assessment Program to improve the early and preventive screening, diagnosis and treatment program for lower-income children under Medicaid. The Administration will press for enactment of this measure, and will urge its expansion to make an additional 1.7 million lower-income children eligible. Teenage Pregnancy Proposal I will propose legislation to establish networks of community based services to prevent unwanted adolescent pregnancies. We need and will urge expansion of existing family planning services to reach an additional 280,000 teenagers. Drug Abuse Drug Abuse threatens the health and safety of our children, here and abroad. We will continue the efforts begun last year to make our drug abuse prevention and control programs more effective and efficient. World Health This year I will present a strategy for working directly with other nations and through international organizations to raise the standards of health and nutrition around the world. EDUCATION Last year the Congress adopted with our cooperation a 15% increase in education funding—the largest increase since enactment of the Elementary and Secondary Education Act. This year we will continue to demonstrate our commitment to improving the Nation's education programs. HEW's education budget expenditures will be increased by 14%, with the most significant increases coming in education of the disadvantaged, assistance to State programs for education of the handicapped, and college student financial aid. The Administration will also work with the Congress for the creation of a separate Cabinet-level Department of Education, and for legislation to replace and reform expiring Federal education acts. These legislative proposals will concentrate on: 
—increasing basic literacy; 
—ensuring that students are prepared for jobs; 
—supporting post-secondary education and lifelong learning; and, 
—strengthening the partnership between Federal, State, and local governments. To augment existing programs, I will propose legislation to help low and middle-income families meet rising college tuition costs, and will also support a significant expansion of student aid programs. INCOME ASSISTANCE Over the past year we have made many far-reaching improvements in the programs that provide income assistance to the needy. My Administration will continue to assign great importance to this area in 1978. Welfare Reform I proposed last year a reform of the Nation's welfare system, through the Better Jobs and Income Act. This Act would fundamentally reform current programs to assist the poor by: 
—consolidating the Aid to Families with Dependent Children, Supplemental Security Income and Food Stamps programs into a single consolidated cash assistance program that provides a basic nationally uniform Federal benefit; 
—improving efforts to find jobs for the poor in the private sector, and creating up to 1.4 million public service jobs for heads of families who cannot be placed in unsubsidized employment; and 
—improving work incentives by expanding the Earned Income Tax Credit. We will work actively with the Congress in the coming year to pass the Better Jobs and Income Act, and we will provide in this year's budget for pilot employment programs so we will be ready to implement the welfare reform program. Family and Children My Administration will continue its strong commitment to strengthening the American family and to expanding programs for children. The Administration will propose this year that the school breakfast program be made mandatory in schools with high concentrations of needy children. Further, we will propose a major expansion in special supplemental food programs for women, infants, and children. Among other major actions in 1978 will be: 
—convening a White House Conference on Families; 
—pressing for enactment of our proposed reforms in foster care programs including new financial assistance to aid in the adoption of hard-to-place children; 
—more than doubling the budget outlays for child welfare services, with an emphasis on services that help keep families together; 
—continuing $200 million in special funding for day care under Title XX of the Social Security Act. We will also depend upon the revitalized Community Services Administration to develop new approaches to assist the poor. THE ELDERLY Last year saw the enactment of Social Security financing legislation that will assure the system's financial integrity into the next century. This year the Administration will continue to work for strengthened legislation against unwarranted age discrimination in the Federal and private sector. We will propose legislation to extend and strengthen the Older Americans Act and we will seek a 13% increase in funding for programs providing daily meals to the elderly, raising the total of daily meals served to 385,000. In addition, the Administration will work to assure that the contributions of older Americans are sought in our efforts to meet national needs. HOUSING Last year we made progress toward our national goal of a decent home in a suitable environment for every American family. 1977 was a good year for housing, generally, with total new starts exceeding two million. And we have renewed the Federal government's commitment to housing for the needy. Early last year, the Administration proposed major new initiatives to meet the housing needs of low- and moderate-income Americans—initiatives which are central to our urban development strategy. We had about 118,000 starts under section 8 and public housing subsidized programs in 1977. We look forward to another 30 percent increase in subsidized housing starts in these programs for 1978, and 92,000 starts in the Assisted Housing Rehabilitation Loan Programs. We will reassess our national housing needs and goals and our current housing and credit policies designed to meet those needs. In 1978, the Administration will strengthen its commitment to meet the housing needs of all communities with a variety of expanded programs and new initiatives: —Rental housing assistance to an additional 400,000 low-income families, and help to enable an additional 50,000 moderate-income families to own their own homes. The total number of families receiving housing assistance will increase from 2.6 million in 1977 to 3.1 million in 1979. —More funds for the rehabilitation loan program under section 312, with an expansion of existing programs for substantial renovations and the creation of a new moderate rehabilitation program under section 8. —A major new operating subsidy program for 1979. This new program, coupled with improved management controls and the monitoring of troubled projects, is intended to reduce the inventory of defaulted projects and aid in restoring distressed urban areas. The Department of Housing and Urban Development has made substantial progress in 1977 in reducing the stock of defaulted projects. This new program will give the Department additional tools. Outlays for this program are estimated to total $52 million in 1979. —A Federal financing mechanism for assisted housing projects through use of the GNMA Tandem program. —A targeted GNMA Tandem program which will provide subsidies designed to bring middle-income families back to the cities. —Targeting of rural housing programs to lower-income residents, including a special program to help very poor families own their own homes. 
—Continuing high levels of production of housing for the elderly and handicapped. TRANSPORTATION This year we will build on the efforts we made last year to strengthen the Nation's transportation system by decreasing consumer costs, pursuing increased energy efficiency, and improving safety: 
—negotiation of a new US-UK bilateral air services agreement; 
—approval of new international air routes from a number of American cities; 
—requiring passive restraint systems on all new automobiles by 1984; 
—setting new fuel efficiency standards for 1981-1984 model automobiles; 
—beginning work on the Northeast Corridor Railroad Improvement Program; 
—passing an all-cargo airline deregulation bill. We will also continue our policy of increasing competition and reducing airfares in international flights, and pursue additional bilateral agreements. Consumers have already benefited from reduced international fares and improved service. Highway and Transit Programs We will soon propose a comprehensive highway and transit program, which will provide more than $45 billion in total authorizations in the 1979-1982 period. The program will give states and localities more flexibility in planning and programming their highway and transit funding, by reducing the number of narrow, categorical accounts and by using consolidated accounts for a wider range of potential transportation projects. In addition, we will make funding of transportation programs more uniform and give localities more control over highway and mass transit funds in large urban areas. Highway Safety The Administration will propose legislation to strengthen ore' efforts for highway safety and to reduce restrictions on the states' use of Federal highway safety grant funds. That legislation will earmark funds for the Department of Transportation to support important highway safety projects, such as the 55 mile per hour speed limit program. Inland Waterway User Fees Users of Federal inland waterways should pay fees which will pay a substantial part of the cost of constructing, operating and maintaining those waterways. My Administration will continue to work closely with Congress toward passage of a bill that will, for the first time, establish inland waterway user fees. Aircraft Noise Abatement My Administration will again seek passage of legislation to control aircraft noise. No-Fault Automobile Insurance We continue to support legislation to establish Federal minimum standards for no-fault automobile insurance. VETERANS In 1977, we took a number of steps to make certain that the country continues to meet the special needs of our millions of veterans. Legislation was passed to increase compensation benefits for service connected disabilities, benefits under the G.I. Bill, and veterans pension benefits. Millions of veterans will feel the effects of these increases this year. In 1978, we will further improve our veterans programs by: —initiating a government-wide review of the problems of Vietnam veterans and the means by which current programs can be made more effective in meeting their needs; —beginning new programs to deal with problems of alcohol, drug abuse and psychological readjustment; —proposing increased benefits for service-connected disabilities, and improvements in the veterans pension program; —continuing special employment programs for Vietnam-era veterans. ARTS AND HUMANITIES Americans are increasingly aware that the arts and humanities preserve and transmit our heritage, enrich our lives, and contribute significantly to the social and economic well-being of our Nation. This Administration is committed to fostering the highest standards of creativity and scholarship in an open partnership between public and private sectors—and we believe that the products of this commitment must be available to the many Americans who wish to share in them. This year's substantial increases in the budgets for the Arts and Humanities Endowments demonstrate my strong belief in the value of these programs. MAKING THE GOVERNMENT MORE EFFICIENT AND MORE RESPONSIVE GOVERNMENT EMPLOYEES Civil Service Reform The Civil Service System is too often a bureaucratic maze which stifles the initiative of our dedicated Government employees while inadequately protecting their rights. Our 2.8 million civil servants are governed by outdated rules and institutions that keep them from being as efficient as they would like to be. No one is more frustrated by this system than hard-working public servants. Therefore, one of my major priorities in 1978 will be to ensure passage of the first comprehensive reform of the system since its creation nearly a century ago—reforms developed with the direct involvement of civil servants. Early this year, Congress will receive legislation and a reorganization plan to: 
—restructure the institutions that run the Civil Service; 
—increase safeguards against abuses of official power; 
—provide greater incentives for managers to improve the Government's efficiency and responsiveness; 
—reduce the system's red tape and delays; 
—speed the procedures for dealing with employee grievances and disciplinary actions; 
—make equal employment opportunities more effective. Last year the Administration acted to protect Federal employees from the loss of a job due to reorganization. Such protection will be maintained. Hatch Act Reform I will continue to support reform of the Hatch Act, which would restore the right of most Civil Service employees to participate in the political process. Part-time and Flexi-time Employment To help obtain Federal jobs for the elderly, the handicapped, women, and others with family responsibilities, all Federal agencies will carry forward renewed efforts to increase part-time and flexi-time employment opportunities. REORGANIZATION, MANAGEMENT AND REGULATORY REFORM The Government Reorganization Project will keep working to make the Government more responsive and efficient. Last year we combined parts of 11 agencies into one Department of Energy, streamlined the Executive Office of the President and reduced the White House Staff, and proposed the abolition of nearly 500 advisory committees and small agencies. In addition to the upcoming Civil Service and education reform efforts, we will soon submit proposals: —to restructure our equal employment programs to provide better protection for the rights of minorities and women, and to ease the burden of compliance on State and local government as well as business; —to improve the administration of justice; and —to reorganize our disaster assistance programs. Additional studies are under way in many other areas, and several of these will result in reorganization proposals later this year. Efforts to improve Federal cash management continue. We are also vigorously pursuing the effort begun last year to reduce the burden of outdated, ineffective, and nitpicking regulations. For example, the Department of Health, Education, and Welfare eliminated 5% of their regulations, the Federal Trade Commission rescinded 111 outdated sets of rules on trade practices and both the Civil Aeronautics Board and the Interstate Commerce Commission have moved to allow more competition, which has led to lower prices. In 1978, we will continue these efforts. Worker Health and Safety The Occupational Health and Safety Administration has already slashed its paperwork requirements by 50% and eliminated 1,100 unnecessary regulations, while improving its capacity to protect workers. This spring the Task Force on Worker Safety will make further recommendations to increase protection for workers and minimize employer cost. Airline Regulatory Reform Last year, I signed legislation deregulating all cargo air transportation. This year, I will continue to work for passage of the airline regulatory reform bill for passengers. That bill will allow air carriers to compete through lower fares, new services, and new markets, without excessive government interference or disruption of service to small communities. Trucking Regulatory Reform Forty years of tight government controls have not done enough to bring us competitive prices, good service, and efficient use of fuel. We will consider measures to bring more competition into the motor carrier area. Drugs We will propose legislation to reform regulation of the drug industry, which will protect the consumer and make regulations fairer and less burdensome. Regulatory Process Early in 1978, I will issue an Executive Order to improve the regulatory process. This Order will require officials responsible for regulations to sign them; assure .that policy-level officials are fully involved in the process; require that regulations be written in plain English; make it easier for the public to participate in the process; increase coordination between agencies with overlapping responsibilities; require a closer look at the cost of regulations before they are issued; and require "sunset" reviews of existing regulations. I have also set up an interagency committee to help regulatory agencies review the economic effects of major regulations, so that we can be sure that the costs of each proposed regulation have been fully considered. In this way we will be able to identify the least costly means of achieving our regulatory goals. Paperwork Reduction In 1977, my Administration decreased by 12% the paperwork burden that the Government imposes on the people. This was done by eliminating, consolidating, simplifying, and decreasing the frequency of reports. That savings is the equivalent of 50,000 full-time workers filling out Federal forms for a full year. All departments and agencies are currently setting goals for further substantial reductions in 1978. All reporting requirements associated with grant-in-aid programs will be subject to "sunset" review and ended unless they are found necessary. In addition, we are reviewing the recommendations of the Commission on Federal Paperwork. LABOR LAW REFORM Last year we proposed legislation to reform our Nation's labor laws, in order to streamline the conduct of elections for employee representation and strengthen the enforcement powers of the National Labor Relations Board. We will work closely with Congress to ensure early passage of this bill, which is one of my highest legislative goals this year. ELECTION REFORM Last year, I supported proposals to make our elections fairer and more honest. These included public financing of Congressional campaigns, amendments to the Federal Election Campaign Act and other election reforms. The Administration will continue to support Congressional action on these measures. CONSUMER REFORM We have taken many actions to benefit consumers by reducing the costs and improving the quality and safety of products. But one consumer initiative merits separate emphasis—the creation of the Office of Consumer Representation. We supported legislation last year to create such an Office, so that the interests of consumers could be represented in one government agency. The Office would not require additional government employees or expenditures since it would merely consolidate the consumer offices that already exist throughout the government. I am strongly committed to this legislation, and regard its enactment as one of the year's primary legislative priorities. PUBLIC BROADCASTING REFORM I proposed legislation last year to strengthen the public broadcasting service by providing increased long-term Federal support, insulation from political pressure, better coordination among the national organizations that run public broadcasting, and more opportunity for citizens to participate at the local level. My Administration will work with Congress this year to pass these reforms. OPENNESS AND INTEGRITY One of our primary goals is to make certain that the government's ethical standards are high, and that they are fully observed. And we must ensure that our government is open and responsive to the American people. Last year, I took steps in that direction by requiring that the senior officials of my Administration publicly disclose their income and assets and pledge not to do business with their agencies for two years after leaving government service. To increase the government's openness, we took steps to make certain that the as well as the letter of the Freedom of Information Act was observed. And we tried to bring the Presidency to the people with citizen forums and discussion panels throughout the country. This year, we will continue these efforts, concentrating our primary attention on these areas: Lobby Reform The Administration will press for legislation requiring registration of lobbyists and thorough public disclosure of their lobbying activities. This long-overdue legislation will help reestablish confidence and trust in government. Ethics I applaud the strong ethical codes adopted last year by the House and Senate. I believe those codes and the standards established for my Administration's officials should be made law, so that they will clearly apply to public officials in the future. I urge Congress to pass the Public Officials Integrity Act this year. Classification We are completing a study of classification systems for government documents and I will shortly issue an Executive Order designed to eliminate improper and unnecessary classification and to ensure that documents are declassified more rapidly. JUSTICE Civil Rights and Equal Opportunity All Americans have fundamental civil rights requiring government protection., and all must be afforded equal opportunities to participate as full members in our society. In 1977, this principle guided my Administration in numerous areas, and I plan to make certain that this year our efforts on behalf of civil rights and equal opportunities continue unabated. Our Nation's concern for human rights must be heard as clearly at home as abroad. Educational Opportunities In 1977, my Administration vigorously attacked educational discrimination on the elementary, secondary and higher education levels. A major suit was pursued to ensure non-discrimination at the university level. At the same time, we recognized and reaffirmed the importance of affirmative action programs to ensure equal opportunities at educational institutions through our brief in the Bakke case. Our efforts to eliminate discrimination and promote affirmative action programs, relying on flexible goals rather than on quotas, will continue in full force. Handicapped HEW issued regulations and guidelines to implement legislation guaranteeing equal access to programs receiving financial assistance from HEW. This year the other Cabinet Departments will issue similar regulations, so that the rights of handicapped Americans will begin to be fully observed. We are providing a $50 million loan fund to States and institutions to enable them to comply with these regulations and to eliminate barriers which prevent access by our handicapped citizens to federally assisted programs and activities. We are proposing a major increase in funding under the Education of all Handicapped Children Act. Equal Opportunity This past year the Administration reaffirmed Executive Order 11375, which prohibits discrimination on the basis of sex in Federal employment. In addition, I voluntarily placed the Executive Office of the President under Title VII of the Civil Rights Act. This year, as part of our effort to eliminate sex discrimination in unemployment and education, I will continue to urge the ratification of the Equal Rights Amendment to the Constitution. This past year the Equal Employment Opportunity Commission was reorganized to increase its efficiency. As a result, the Commission made substantial progress on reducing its backlog of complaints. With the more than 40% increase in funding that will be proposed in the 1979 budget, the EEOC will be able to further reduce its backlog. Early this year I will propose to Congress a reorganization plan concerning equal opportunity enforcement which will strengthen the EEOC. Anti-Foreign Boycott I strongly supported, and signed, legislation to prohibit American participation in secondary economic boycotts by foreign countries. That law will be strictly enforced by my Administration this year through the regulations just issued by the Department of Commerce. Minority Business Last year, we started a number of programs to make more opportunities available for minority-owned businesses. That effort will be continued and strengthened this year: —We are half way toward our two year goal of $2 billion in Federal purchases of services and goods from minority-owned firms. We will reach that goal by the end of the year. —We will raise the goal for Federal deposits in minority-owned banks above the 1977 level of $100 billion. —We will continue to enforce the $400 million minority business set-aside provision in the local public works act, and may exceed that target. —We will continue to implement the minority business set-aside policy established for contracts let in the North- 
east Corridor Railroad Improvement Program. Undocumented Aliens Last year, I proposed legislation to impose sanctions on employers who hire undocumented aliens and to change the legal status of the many undocumented aliens now residing in this country. That legislation would afford undocumented aliens residing here continuously since before 1970 the opportunity to apply for permanent resident status. It would create a new five-year temporary resident status for those undocumented aliens who resided here continuously from 1970 to January 1, 1977. I want to work with Congress this year toward passage of an undocumented aliens bill, for this social and economic problem can no longer be ignored. Native Americans The Administration has acted consistently to uphold its trusteeship responsibility to Native Americans. We also have elevated the post of Commissioner of Indian Affairs to the level of Assistant Secretary of Interior. In 1978, the Administration will review Federal Native American policy and will step up efforts to help Indian tribes assess and manage their natural resources. LEGAL AND JUDICIAL REFORM Last year, my Administration began a number of major efforts to improve our Nation's legal and judicial system, and we intend to pursue those and related efforts fully this year. Criminal Code Reform We have worked closely with members of Congress to develop a proposed revision of the Nation's Criminal Code. That revision will codify in one part of the U.S. Code all Federal crime laws and will reform many outdated and inconsistent criminal laws. My Administration will work closely with Congress this year to seek passage of the first complete codification of the Nation's criminal laws. Judicial Reform The Federal judicial system has suffered for many years from an inadequate number of judges, and we will continue to work with Congress on an Omnibus Judgeship Bill to correct this problem. We will also continue our efforts to use our judges more effectively, through legislation which we have proposed to expand significantly the authority of magistrates, to increase the use of arbitration, and to tighten Federal jurisdiction. We will work this year to complete Congressional action on these bills. Wiretap Reform Last year we proposed legislation reforming our approach to electronic surveillance for foreign intelligence purposes, and affording greater protection to our citizens. Essentially, that legislation would require the government to obtain a court order before beginning any foreign intelligence wiretaps in this country. My Administration supports early passage of this much needed legislation. Anti-trust Enforcement and Competition Our Nation's anti-trust laws must be vigorously enforced. Therefore, I recently established a Presidential Commission to review Federal anti-trust enforcement, and to make its recommendations this year. Last year, we initiated a new program, administered by the Department of Justice, to provide grant funds to State Attorneys General in order to strengthen anti-trust enforcement at the State level. We expect to see the results of this program this year. By reducing government regulation, we can increase competition and thereby lower consumer costs. This year we will continue our deregulatory efforts in the legislative and administrative areas in order to reduce anti-competitive practices and abuses. Crime Reduction and Criminal Justice This past year the Reorganization Project and the Justice Department have been developing proposals to reorganize and to improve our Nation's criminal justice system, in order to strengthen enforcement and ensure equal justice. This year I will be sending a Message to Congress on criminal justice and crime reduction. My Message will include proposals to: 
—reorganize the Federal Law Enforcement Assistance Administration; 
—improve our criminal research efforts; 
—develop better law enforcement methods against organized crime, white collar crime, drug abuse, and public corruption; and 
—develop minimum standards for Federal correctional institutions. FBI and Intelligence Agencies' Charters I plan to issue a comprehensive Executive Order to govern the intelligence activities of the FBI, CIA, NSA and the Defense Department. That Executive Order will be the basis for the Administration's recommendations on legislative charters governing the activities of the FBI and various intelligence agencies. Privacy The Privacy Protection Study Committee recently proposed an extensive list of new legislative and regulatory safeguards. My Administration is analyzing these recent proposals and will develop this year a program to ensure that personal privacy is adequately protected. District of Columbia We proposed last year a series of reforms, including full voting representation in Congress, designed to give the residents of the District significantly greater control over their local affairs. My Administration will continue to work for the passage of those reforms this year. DEVELOPING AND PROTECTING OUR NATURAL RESOURCES ENERGY National Energy Policy In April 1977, I proposed to the Nation a comprehensive national energy policy. That policy is based on three principles, which will continue to guide our progress in 1978: 
—we must learn to use energy more efficiently and more carefully, through conservation measures, including retrofitting our buildings, factories and homes; 
—we must shift from oil and natural gas, which are becoming more scarce, to coal and renewable sources of energy which we have in abundance; 
—we must provide fair prices to producers of energy, so as to encourage development of new supplies without permitting windfall profits. The debate on this comprehensive policy has been long and arduous. A number of difficult, contentious issues remain to be settled. I am confident, however, that the Congress recognizes the seriousness of our energy problem and will act expeditiously on this program early this year. Securing passage of an acceptable energy bill—one which is fair to consumers, provides needed energy savings, and is prudent from a fiscal and budgetary standpoint—will continue as our highest and most urgent national priority in 1978. Energy Statutes and Actions We have already begun to lay a strong foundation for implementation of a national energy policy. In 1977 we took steps to put in place important policies and structural reforms needed to meet our energy goals: —Creation of a new Department of Energy which combines, for the first time, major governmental functions of energy research, regulation, pricing policy, information collection and dissemination, and overall policy development. Without a strong organization, we would not hope to implement a comprehensive national policy. —Congress has approved our proposed route for a pipeline to bring natural gas from the North Slope of Alaska to the lower 48 states. —Passage of the Emergency Natural Gas Act to cope with the hardships of last winter's freeze and assure that high priority gas users were not cut off during supply emergencies. —Funding of more than $4 billion to store the first 500 million barrels of oil in a strategic petroleum reserve. We have already begun to fill that reserve, and we remain committed to a 1 billion barrel strategic reserve by 1985. Outer Continental Shelf Legislation Legislation to improve the management of the Outer Continental Shelf for oil and gas development is a major item of unfinished business pending before Congress. Prompt passage is necessary so that we can have the benefit of the new law as we move to open more offshore areas to development and production. This bill mandates long-needed reforms in the leasing program to provide for the necessary development of offshore oil and gas while enhancing competition among oil companies, assuring that the public receives a fair return for the sale of the public's oil and gas resources, and protecting our marine and coastal resources. Nuclear Energy The United States has also advanced a policy to prevent the proliferation of nuclear weapons around the world. An International Nuclear Fuel Cycle Evaluation has been established with wide international participation to examine alternatives to existing proliferation-prone technologies. In addition, legislation was proposed last year to establish better controls on export of nuclear fuels and technologies. We will work with Congress to secure passage of that legislation early in 1978. Our commitment to preventing the spread of nuclear weapons has led us to reorient our own domestic nuclear policies. I have deferred indefinitely the commercial reprocessing of spent nuclear fuel and plutonium recycling. The Clinch River Plant itself would waste more than $2 billion while teaching us little that we do not already know, or cannot learn from our existing nuclear research and development program. I have recommended that the Clinch River Breeder Project be stopped, because it represents a premature and unwise commitment to commercialization of technology that we do not now need. However, we intend to continue to develop the nuclear energy the Nation needs. We will continue to move forward with a major research program on breeder technology. We will begin to implement our program for government management of spent fuel from nuclear reactors. In 1978, my Administration will work towards a policy for safe, permanent disposal of nuclear wastes. In 1978 and beyond, we will carry on a vigorous nuclear research and development program designed to give us safe technologies that will reduce the danger of nuclear proliferation and will be environmentally responsible. We will also seek to improve the current system of licensing nuclear power reactors in order to cut bureaucratic delays, while firmly maintaining and strengthening health, safety and environmental requirements. I will propose nuclear licensing legislation to the Congress this year. ENVIRONMENT One of my deepest personal commitments is to a clean, healthy environment for all of our citizens. Last May, I outlined this Administration's environmental priorities and policies in a comprehensive Environmental Message. Working closely with the Congress, we have made good progress on many of the measures contained in that Message; it will continue to guide our administrative and legislative actions in 1978. Overall, we will: —increase our environmental outlays by more than 10%, and provide the new staff resources necessary to ensure that the Nation's environmental laws are obeyed; —determine the best way of enforcing the landmark environmental statutes enacted in 1977, taking considerations of science and public policy into account; —pursue several important initiatives, including a National Heritage program and designation of national interest lands in Alaska, to manage our precious natural resources better and to preserve our heritage. Environmental Statutes In 1977, we worked closely with Congress to enact three of the most significant environmental statutes in recent years: —The Surface Mining Control and Reclamation Act establishes a joint Federal-State program to make sure we use economically and environmentally sound strip-mining practices. It also sets up a fund to reclaim lands which have been ravaged by uncontrolled, careless mining, and provides clear, stable policy direction for operators. —The Clean Air Act Amendments establish strict but achievable standards for auto emissions and ensure continued progress in reducing pollution from stationary air pollution sources. —The Clean Water Act authorizes many of our most important water cleanup programs and will protect our Nation's wetlands without unnecessary Federal requirements. The Act also reforms the sewage treatment construction grant program and gives strong emphasis to the control of toxic chemicals in our environment. We will provide the leadership and the funding necessary to carry out these new laws. Water Policy In 1977, an effort was begun to ensure that Federal programs and policies provide sound and fair management of our limited and valuable water resources. We. began a complete review of Federal water policy, which will be completed this year. After close consultation with the Congress, the States, and the public, we will propose measures needed to carry out the recommendations of that study. We will also continue with the strong dam safety inspection program which was initiated late last year to make sure our dams, public or private, are safe. Alaska Lands Last year, I sent Congress a proposal for use of Federal lands in Alaska. This proposal will protect 92 million acres for the public, will create or expand 13 national parks and reserves, 13 national wildlife refuges, and will confer wild and scenic river status on 33 waterways. I hope Congress will adopt these measures, which are needed this year to preserve the unique natural treasures of Alaska and, at the same time, permit the orderly development of Alaskan resources. Redwood National Park Redwood National Park contains some of the Nation's largest and oldest trees. Last year, to protect these trees from destruction by commercial logging at the edges of the Park, legislation was proposed to expand its boundaries. We will press for Congressional action on this bill in 1978. National Heritage Program We will shortly be proposing a Federal-State program to preserve unique elements of our natural and cultural heritage. This program, modeled after successful ones in several states, will be administered by the Department of the Interior. Although many of the necessary steps can be taken administratively, we will seek some new legislative authority in 1978. Federal Compliance with Environmental Laws My Administration is committed to the principle that the Federal government must set a good example of compliance with those environmental laws and regulations which have been established for the private sector. So far, unfortunately, the Federal record has been found wanting. My 1979 budget includes money to bring Federal facilities into compliance with existing environmental laws and regulations. Federal Reclamation In 1977, we began a thorough review of the 1902 Reclamation Act. After the study has been completed and reviewed this year, I will propose to Congress any changes needed to modernize the law. Mining Law Reform Last year the Administration proposed legislation to replace the archaic 1872 Mining Law with a modern leasing system for publicly-owned mineral resources. The 1872 system has resulted in withdrawal of large areas of land from mineral exploration as the only tool for environmental protection. The Administration's proposal would establish a balanced system where the public interests in mineral development, environmental protection and revenue to the U.S. Treasury will all be accomplished. Special provisions would minimize burdens on small operators and provide incentives for exploration. Oil Spills Last year I proposed to Congress legislation which would establish strict liability standards for oil tanker spills and would improve regulations aimed at preventing future oil spills. That legislation is still needed. SCIENCE AND TECHNOLOGY The health of American science and technology and the creation of new knowledge is important to our economic well-being, to our national security, to our ability to help solve pressing national problems in such areas as energy, environment, health, natural resources. I am recommending a program of real growth of scientific research and other steps that will strengthen the Nation's research centers and encourage a new surge of technological innovation by American industry. The budget increase of 11% for basic research will lead to improved opportunities for young scientists and engineers, and upgraded scientific equipment in the Nation's research centers. I am determined to maintain our Nation's leadership role in science and technology. We will continue America's progress in the field of space exploration with continued development of the space shuttle system and procurement of four shuttle orbiters for operations from both East and West coasts, development of a spacecraft to study for the first time the polar regions of the Sun, and increased outlays for demonstrations of the practical applications of space-based systems and development of space technology. FOREIGN AFFAIRS A year ago I set five goals for United States foreign policy in the late 1970's and early 1980's: to reassert America's moral leadership; to strengthen our traditional ties with friends and allies; to work toward a more just international system; to promote regional reconciliation; and to preserve peace through preparedness and arms control. These goals continue to underlie my agenda for 1978. MORAL LEADERSHIP During the past year, we have placed American foreign policy on a new course consistent with the values and highest ideals of the American people. We are trying to limit the worldwide sale of arms; we are trying to prevent nuclear explosives—and the ability to make them—from spreading to more countries; we are building .a new relationship with the developing countries, and we are promoting human rights throughout the world. Human Rights Virtually everywhere, human rights have become an important issue—especially -in countries where they are systematically violated. There has been real progress, and for that the United States can take some credit. We have taken the lead among Western nations at the Belgrade Review Conference on Security and Cooperation in Europe. Working closely with our Allies, and with neutral and non-aligned nations, our delegation—led by Ambassador Arthur Goldberg—has conducted a thorough review of implementation of the Helsinki Final Act, in all its aspects. We have made clear the United States is committed to the full implementation of the Final Act in this and other areas. We will seek a further Review Conference in two years; meanwhile, we will press for better implementation of the Helsinki Final Act. Non-Proliferation We must not ignore the enormous dangers posed by the unrestrained spread of nuclear weapons technology. We recognize the benefits of commercial nuclear power, but we also must acknowledge the risks. We believe that all countries can enjoy the benefits, while the risks are minimized, by developing safer technologies and creating new institutions to manage and safeguard all phases of the nuclear fuel cycle. Meanwhile, we have decided to postpone a premature commitment to technologies we cannot yet safely manage on a commercial scale; and we are seeking to persuade others that there are sound economic and energy reasons for them to do likewise. Arms Sales The world is threatened by the spiraling increase in trade of conventional arms. Not only do these arms increase the likelihood of conflict, they also divert resources from other human needs. It will not be easy to slow this spiral. We will begin to cut back on our own sales in recognition of the fact that, as the world's principal seller, we have a duty to take the first step. But we know that our efforts can only succeed if other major arms suppliers and recipients cooperate. TIES WITH FRIENDS AND ALLIES The energy crisis has underscored the reality of interdependence among nations and the need for a stable international financial and trading system. Our own actions reflect the belief that consultations with traditional friends and dialogue with developing nations are the only way that the United States can provide the economic and political leadership which the world expects of us. Working with the Allies During the past year, the United States restored our traditional friends and allies to the center of our foreign policy. Within days after his inauguration, the Vice President visited Brussels, Rome, Bonn, Paris, Reykjavik, and Tokyo. I met frequently in Washington with European and Japanese leaders. I participated in the Economic Summit in London, the 1977 NATO Summit, and a Four-Power Summit with leaders of Britain, Germany, and France. At the beginning of 1978, I visited France and Belgium—and while in Brussels, made the first visit by an American President to the headquarters of the European Community. We have also consulted with our European Allies on such diverse subjects as SALT, MBFR, the Middle East, Africa, human rights, the Belgrade Conference, energy, nonproliferation, the global economy, and North-South relations. We will intensify these efforts this year, expanding the list to include close consultations with the Allies on major arms control issues. On May 30-31, we will host a NATO Summit in Washington, and we are also planning another Economic Summit this year. We have shown in our dealings with Japan that close allies can find solutions to shared problems. Early in the year, we were concerned about nuclear reprocessing in Japan, but through flexibility and goodwill on both sides a suitable accommodation was reached on the building of a nuclear reprocessing plant there. Most recently, we reached agreement with the Japanese on ways to deal with their large current account surplus. Our trade and economic talks are another example of constructive action. International Economic Cooperation We are working to improve and extend the international economic system, to strengthen international economic institutions, and to ensure that international economic competition takes place in an orderly fashion. We will seek to improve cooperation among nations in the IMF, the GATT, the World Bank, the OECD, and other international organizations which have enabled us to maintain an open, liberal, trade and payments system. The American economy remains strong. Our competitive position in international trade is excellent. In 1977 our merchandise exports exceeded imports (except for oil) by a large amount. Our inflation rate is among the lowest in the industrial world. But our balance of trade and payments incurred a large and worrisome deficit. There were two main causes: —In 1977, $45 billion flowed out to pay for imported oil. This wiped out what would otherwise have been a trade surplus. —The demand here for foreign goods was much greater than the demand for American goods abroad. In 1977, American GNP increased roughly twice as fast in real terms as the GNP of our main trading partners. Against this background, the exchange rate of the dollar declined relative to the currencies of Japan, Germany, Switzerland, and other European countries. These developments led to disorderly conditions in the exchange markets. In December I made clear that the United States would intervene to counter these disorders, and we have done so. To assure the integrity of the dollar we must act now: —We need a healthy and growing United States economy, with adequate investment, a prudent budget, and declining inflation. This will make us more competitive and more attractive to foreign investors. —We need to conserve energy and develop alternative sources of supply. This will reduce our dependence on imported oil, and cut the outflow of dollars. —We need to see a more vigorous world economy. Stronger growth, particularly in countries like Germany, Japan, Switzerland, and the Netherland, can help reduce our own deficits and bring stability to international payments. Factors already at work will reduce our trade deficit. Economic activity in Europe and elsewhere should rise. Our oil imports should level off this year. The effect of new exchange rates that have already occurred will, when their full effect is realized, improve our trade balance by several billions of dollars. While our trade and payments deficit in 1978 will be large, our external position should show some improvement. We must also augment our capacity to deal with possible strains and pressures by strengthening our international trade and monetary system. I urge the Congress to act promptly to approve United States participation in the IMF's Supplementary Financing Facility. The trading nations of the world are engaged in negotiations to reduce barriers and improve the international trading system by a reciprocal and balanced opening of markets. Freer trade will enable us all to use the world's resources more efficiently and will contribute to economic growth. We will also attempt to strengthen the rules that have regulated international trade during the last 30 years. International competition must take place within a framework of agreed rules that are recognized as appropriate and fair. THE DEVELOPING COUNTRIES One of the most critical issues facing the United States is our economic and political relationship with developing countries. Our economy has become visibly dependent on the developing world for supplies and markets. North-South Dialogue Throughout 1975 and 1976 the United States and other developed countries worked with a group of developing nations in the Conference of International Economic Cooperations (CIEC). That "North-South Dialogue" reached agreement on some issues in June 1977, but there remain a number of unresolved questions. The United States will continue to consult and negotiate with developing countries on questions like commodity price stabilization, technology, and a common fund for international buffer stocks. We will pursue the North-South dialogue in the months ahead, confident that the developed nations and the developing nations can agree upon measures that will let all nations participate more fully in the management of the world economy. Africa Our relations with Africa involve energy, human rights, economic development, and the North-South dialogue. The Maputo and Lagos Conferences demonstrated that African countries can discuss difficult problems with us, to mutual advantage. Our relations with Nigeria have improved dramatically. The Administration's FY 79 budget substantially increases development assistance to Africa, including continued support for the African Development Fund, and other programs to help African governments meet their people's basic human needs. The growth of African regional institutions like the Sahel Development Fund is important to African development. Latin-America/Caribbean The Administration's approach to Latin America and the Caribbean recognizes this region's diversity. We have placed great importance on the protection and defense of human rights, on halting the proliferation of nuclear weapons capabilities, on restraining conventional arms sales, on contributing to the settlement of disputes, and on engaging Latin governments in global economic negotiations. We are now seeking Senate ratification of Protocol I of the Treaty of Tlatelolco, and the American Convention on Human Rights. Through the Caribbean Group, we are trying to promote regional development. And we intend to help several nations develop alternative energy sources. Panama General Torrijos and I signed the two Panama Canal Treaties on September 9 [7], 1977. These treaties meet the legitimate interests of Panama and the United States and guarantee our permanent right to protect and defend the Canal. They will contribute importantly to regional stability. Asia The United States has sought to underline our desire for a close relationship with the developing countries of Asia through my visit to that continent and through regular contacts with the member countries of the Association of Southeast Asian Nations. We welcome the cooperation with ASEAN of the developed countries of the region, such as Japan and Australia. PROMOTING REGIONAL RECONCILIATION The greatest danger to world peace and stability is not war among the great powers, but war among small nations. During the past year, the United States has helped to promote productive negotiations in two troubled regions: the Middle East and Southern Africa. We have also tried to settle conflicts in the Horn of Africa and on Cyprus. And we have negotiated two Panama Canal Treaties that will enhance our country's relations with all the nations of Latin America. The Middle East In an effort to break with the rigid approaches of the past and bring about an overall peace settlement, I have looked to three basic principles: normalization of political, economic and cultural relations through peace treaties; withdrawal of armed forces from occupied territory to recognized and secure borders and the establishment of effective security measures; and a resolution of the Palestinian question. Significant progress toward peace in the Middle East was made last year; we particularly applaud President Sadat's courageous initiative, reciprocated by Prime Minister Begin, in launching direct negotiations. The United States will continue this year to encourage all parties to resolve this deep-seated conflict. Southern Africa The entering Administration inherited problems in Rhodesia, Namibia, and South Africa. —With the British, the United States launched new Rhodesian discussions last year. The Anglo-American Plan of September 1 sets forth fair and workable principles for majority rule: a transition period leading to free elections, a UN presence, a constitution with a judicially protected bill of rights, and a Zimbabwe Development Fund. —The five-power Contact Group, in which the United States participates, has held discussions with South Africa and with the Southwest Africa Peoples Organization and other interested parties on an internationally acceptable settlement for an independent Namibia under majority rule. This effort has produced wide agreement, including provisions for a substantial UN presence. —The United States has told the South African Prime Minister that unless his nation begins a progressive transformation toward full political participation for all its people, our relations will suffer. We supported a Union Nations arms embargo on South Africa, prohibited "gray area" sales, and began a review of us/ South African economic relations. The Horn of Africa Arms supplied by the Soviet Union now fuel both sides of a conflict in the Horn of Africa between Somalia and Ethiopia. There is a danger that the Soviet Union and Cuba will commit their own soldiers in this conflict, transforming it from a local war to a confrontation with broader strategic implications. We deplore the fact that disagreements in this region have grown—with the assistance of outside powers—into bloody conflict. We have made clear to both sides that we will supply no arms for aggressive purposes. We will not recognize forcible changes in boundaries. We want to see the fighting end and the parties move from the battlefield to the negotiating table. Cyprus We hope that the groundwork was laid in 1977 for a permanent settlement in Cyprus and we are encouraging movement in that direction. PRESERVING PEACE During the past year, the Administration has assessed the threats to our own and our Allies' security, as well as our collective strength to combat these threats. We have sought to promote responsible arms control efforts and to reduce competition in arms. Recognizing that a strong defense is the foundation of our security, we have made certain that our defense spending will be sufficient and used to maximum effect. Arms Control The fundamental purposes of our arms limitations efforts are to promote our own national security and to strengthen international stability, thereby enhancing the prospects for peace everywhere. —We are trying to move the Strategic Arms Limitation Talks toward more ambitious objectives. We want to reduce, not just contain, the competition in the number of strategic weapons possessed by the United States and the Soviet Union, and to limit qualitative improvements in weapons which merely raise the risks to all of us. Precisely because of our determination to obtain both of these objectives negotiations have been difficult and prolonged. However, I am confident that the agreement that we will present to the Congress will meet them. —We have also made solid progress toward an objective that the United States has pursued for many years: a comprehensive treaty banning all nuclear explosions. This treaty will be open to all nations of the world. It will be a major step toward reduced reliance on these weapons and toward halting their further spread in the world. —At the same time we are seeking arms limitations agreements with the Soviet Union that will contribute to security and stability in various regions of the world. In Europe we and our NATO Allies are seeking a mutual and balanced force reductions agreement that will achieve greater stability and balance at lower levels of forces. In the Indian Ocean, where neither we nor the Soviet Union has yet deployed military power on a large scale, we are working for an agreement to prevent a major military competition. —For the first time, we have begun to negotiate with the Soviet Union the outlines of a treaty banning chemical warfare. —An essential element of American security is the maintenance of stability in the Western Pacific, where the United States plays a major role in maintaining a balance of power. We are seeking to readjust our military presence in Korea by reducing our ground forces on the Peninsula and undertaking compensatory measures to ensure that an adequate balance of forces remain. We are talking with the Filipino government about the future of our military bases there. —We are continuing the process of normalization of our relations with the People's Republic of China within the framework of the Shanghai Communiqué. —In the last year, we have sought to halt the worldwide spread of nuclear weapons capacity. Nearly 40 nations have joined with us in an effort to find nuclear power sources that cannot be readily used for building nuclear weapons. Defense Posture/Budget The defense budget that I am recommending to Congress will fulfill our most pressing defense needs. I am requesting increases in defense spending that more than compensate for inflation. They are needed to maintain an adequate military balance in the face of continued Soviet military efforts. —As we negotiate with the Soviets over strategic arms, we are continuing to preserve essential equivalence in strategic nuclear strength. Here our technological advantage over the Soviet Union is most apparent. We are building cruise missiles, which together with upgraded B-52s will assure the capability of this element of our Triad. We are continuing to develop the M-X missile system in case we need to deploy them. In this budget, I am requesting funds for continued increase in our Trident submarine force, which is our most important strategic program because submarines are so hard for any enemy to destroy. —With our NATO Allies we are trying to improve the initial combat capability of NATO forces. We will improve the readiness of critical combat units, enhance American capability to send ground and tactical air forces reinforcements, and increase our permanent forces there. To lay the foundation for future improvements, the budget I propose requests 18% increases in the procurement of equipment for the Army. The United States is not taking these steps alone; we are participating in a mutual effort. —The importance of sea forces to United States national security is undisputed. The Navy receives the largest share of the defense budget, and I am requesting funds to continue its modernization. But, we need to examine the appropriate size and mix of United States naval forces in the future. Therefore, I have deferred spending for new aircraft carriers until a current Defense Department study is completed early this year. While we maintain our naval strength, we should have the capability to deploy rapidly a light but effective combat force worldwide, if necessary, without overseas base support. To this end, I am requesting funds for a vigorous airlift enhancement program. In these and other ways, we are seeking to develop a foreign policy which is wider in scope; a foreign policy which recognizes global diversity; and a foreign policy which builds a more just and stable international system. JIMMY CARTER 
The White House, 
January 19, 1978.
Tonight's State of the Union Address concentrates on this year's highest priorities—a strong energy bill; a coordinated economic program of job creation, tax reduction, tax reform and anti-inflation measures; making the government more effective and efficient; maintaining the peace through a strong national defense; and ratifying both the Panama Canal Treaties and, if completed, the SALT II treaty. It is important that the Congress and the Nation also understand what our other important initiatives and goals will be for 1978. I am therefore sending to Congress this separate, more detailed State of the Union Message, which describes Administration priorities in the areas not fully covered in the Address. DOMESTIC AFFAIRS A number of serious domestic problems faced the Nation when I took office one year ago. The economy had not yet fully recovered from the recession; our country had no sound energy policy; the Federal government was operating inefficiently and ineffectively in many areas; concerns about the openness and integrity of our government remained in the aftermath of Watergate; and many of our most pressing social problems had not been addressed. In 1977, my Administration did not solve all of those problems. But Congress joined us in tackling many of these issues, and together we made progress. Now that a year has passed, I believe we are a more confident people, with more trust in our institutions. We are a country on the move again, prepared to address our problems with boldness and confidence, at home and abroad. We have reasserted our concern for the problems of people here at home and reaffirmed our position of moral leadership in the world. This year, my domestic goals will continue to reflect those concerns that guided my actions in 1977: restoring economic prosperity; meeting our Nation's human needs; making the government more efficient and more responsive; and developing and protecting our natural resources. RESTORING ECONOMIC PROSPERITY I am devoting a substantial part of my State of the Union Address to the need for a comprehensive economic program, and I will devote the bulk of my Economic Report to Congress, to be delivered tomorrow, to a complete description of my Administration's economic goals and objectives. In this Message, therefore, I will not repeat those statements but I want to set forth briefly the key elements of those proposals: —a $23 billion income tax cut in 1979, with $17 billion going to individuals and their families and $6 billion going to businesses; —a tax reform program designed to make our tax laws fairer and simpler; —an anti-inflation program, designed to reduce annual increases in wages and prices, with the cooperation of labor and business and with the Federal government setting an example; reductions of $2 billion in excise and payroll taxes will also make a contribution to reducing inflation; —an extension of the funding for 725,000 public service (CETA) jobs, and a $700 million increase in spending for our youth employment efforts; —a major new $400 million private sector jobs initiative, designed primarily to encourage businesses to hire unemployed minorities and youth. I plan to work very closely with Congress to secure prompt action on these economic proposals. Their adoption will help achieve the kind of economic prosperity for our Nation that all of us want. Along with a sound energy bill, enactment of these economic proposals will be my highest domestic priority for 1978. ENERGY There can be no higher priority than prompt enactment of comprehensive energy legislation along the lines submitted to the Congress last spring. Huge oil price increases in 1973-74 contributed to the double-digit inflation of 1974, and to the worst recession in 40 years. These price hikes were also the principal because of our foreign trade deficit, which has contributed to the weakness of the dollar abroad. Unless we act now, our energy problems will rapidly get worse. Failure to act will fuel inflation, erode the value of the dollar, render us vulnerable to disruptions in our oil supply, and limit our economic progress in the years to come. I am confident that the Congress will respond to the Nation's clear need, by enacting responsible and balanced energy legislation early this year. EMPLOYMENT Last year we made considerable progress in our efforts to reduce unemployment. The unemployment rate decreased from 7.8% to 6.4%. During the year, 4.1 million new jobs were created. Unemployment fell by 1.1 million workers. The actions we took as part of our $21 billion economic stimulus package substantially helped us achieve these favorable results. In 1978, the Administration will continue its efforts to reduce unemployment still further and to increase employment opportunities for all Americans. As part of the budget I will propose: —additional funds to increase youth programs 260% above the 1976 level, providing $2.3 billion in outlays and 450,000 man-years of employment and training for young workers; —a $400 million private sector employment program focused on youth and other disadvantaged workers and aimed at mobilizing private industry to work with government in finding jobs. It will be implemented through business councils established throughout the country; —maintenance of the 725,000 CETA jobs through 1979, while tying them in future years to national unemployment rates; beginning of a demonstration program for the jobs component of the Better Jobs and Income Program. Humphrey-Hawkins Legislation The Administration will seek passage of the Humphrey-Hawkins Full Employment and Balanced Growth Act. This Act will help the Administration and the Congress in planning our efforts to reduce unemployment and to create jobs, while maintaining reasonable price stability. Its enactment would serve as a living memorial to the late Senator Hubert Humphrey. Private Sector Jobs The Administration plans a major $400 million effort to involve business and labor in the training and hiring of the hard-core unemployed. The program will closely tie the Federal employment system with the private sector, through the use of business councils. I am confident that the private sector will respond positively to the call to help the Nation solve one of its most serious problems the employment of our youth and minorities. INFLATION Although inflation is lower now than in the recent past, we still must do more to keep it down. The steps my Administration will take include: —incentives for business investment, contained in our tax proposals, which will increase productive investment, and thereby help us hold down prices and costs; —reduction in excise and unemployment taxes, proposed in the new budget; —continuing reductions in needlessly complex Federal regulations. We have established a high-level interagency committee to review the effects of regulation in our economy, and we will continue our efforts for regulatory reform in the airline industry and elsewhere; —a special effort to hold down the soaring costs of health care, through enactment of the Hospital Cost Containment Act. But the government cannot solve this problem alone especially once business, labor, and consumers have accel)ted inflation as a fact of life, and adjusted their behavior accordingly. I have therefore asked business and labor to undertake, voluntarily, a new program to reduce inflation. I will ask each industry to aim for smaller price and wage increases in 1978 than it averaged over the last two years. As a major employer the Federal government should take the lead in this effort. Voluntary cooperation is one way—perhaps the only way—to reduce inflation without unacceptable government interference and coercion. URBAN ASSISTANCE AND COMMUNITY DEVELOPMENT The Administration and Congress took major steps last year to meet the needs of our cities. We increased funding for Community Development Block Grants by $2.7 billion over three years, and provided an alternative formula for allocating funds that was more responsive to the needs of distressed urban areas. Next year we will recommend an increase of $150 million over the 1978 level for the Community Development Block Grant program. We enacted a new program of Urban Development Action Grants at an annual level of $400 million, and extended and expanded Anti-Recession Fiscal Assistance (ARFA). I am proposing that the ARFA program, which expires September 30, 1978, be extended. We are evaluating possible revisions in programs and funding, and will make our recommendations to the Congress within two months. The Administration is also studying closely the possible need for extended Federal lending to New York City. The current legislation expires on June 30, 1978. We are committed, along with the State and City, to preserving the City's solvency. If such extended lending is necessary for that purpose, we will propose it. However, all the interested parties must contribute to a permanent solution. This spring I will submit to Congress a message outlining this Administration's urban policy, based on the work of the Urban and Regional Policy Group, chaired by the Secretary of Housing and Urban Development. It will be designed to make existing Federal programs more effective, and will involve new initiatives and resources to address our urban needs. The long-standing problems of our cities are structural in nature and cannot be corrected by short-term or one-time efforts. This Administration is committed to a long-term and continuing effort to meet stubborn problems and changing needs. Our urban policy proposals will: —build a more effective partnership between the Federal government, State and local governments, the private sector, neighborhood groups and concerned citizens; —be sufficiently flexible to meet the diverse needs of our urban areas and to respond to particular problems of distressed areas; —address the fiscal needs of hardpressed urban governments, as well as the economic and social needs of city residents; —improve the urban physical environment and strengthen urban communities; —use Federal assistance to stimulate job-creating investments by the private sector and to encourage innovative actions by the State and local governments. AGRICULTURE AND RURAL DEVELOPMENT Decent farm income and a strong family farm system are vital to our national economic stability and strength. For too long farm prices for many commodities have been severely depressed. Working with the Congress in the past year, we have adopted new programs and policies designed to strengthen farm income and to ensure abundant, reasonably priced food for consumers. Partially as a result of these policies and programs, farm prices are now improving. Nevertheless, we cannot be satisfied with the economic condition of many American farmers today. We will continue to monitor our agricultural economy and to work with Congressional and farm leaders to make certain that Federal programs and policies are carried out effectively. Food and Agriculture Act In the past year we have worked with the Congress to enact a new comprehensive Food and Agriculture Act, which will protect producers and consumers. We have also exercised set-aside authority for wheat and feed grains, which will protect farm income. This year we expect to pay farmers $7.3 billion for all price support programs. The new farm bill which became effective October 1, 1977, achieves long-needed changes in our agricultural policies, including: —minimal governmental intervention in markets and in the decisions farmers make; —price support loans for major commodities that permit us to remain competitive in world markets; —a grain reserve designed to remove excess products from the market and hold them until supplies are short; —income support levels based on cost- of-production. Grain Reserve Last year we initiated a plan to place 30-35 million metric tons of food and feed grains in reserve. Establishing this reserve will add further strength and stability to the market and provide a hedge against export control on grain. Most of this grain will be owned and controlled by farmers. To strengthen farmer control of the grain and to help keep the grain out of government ownership, terms of the farmer storage facility loan program were liberalized. In 1978, the Administration will propose an international emergency grain reserve of up to 6 million metric tons to help us meet our food aid commitments abroad. Agricultural Disaster and Drought Aid Because of the record droughts in 1977, I worked with Congress to pass an $844 million Emergency Drought Assistance Program. This year we will ask Congress to eliminate the many inconsistencies and inequities in existing disaster aid programs, and we will continue to give high priority to addressing the effects of the drought, which has begun to abate. We are taking other steps to improve life in rural America. I recently signed a law to encourage better delivery of health services in rural communities. We will continue to expand the assignment of the National Health Service Corps' doctors, dentists and other health professionals to underserved rural areas. We will shortly be announcing methods to improve the effectiveness of rural housing programs with greater emphasis on home ownership for rural Americans. Agricultural Exports I want to increase our agricultural exports. To do so we need competitive prices, high quality products, and reserve supplies to meet all contingencies. We must remove unnecessary barriers to exports. And we must have an affirmative export policy. In 1977, the Administration more than doubled (to $1.7 billion) the short-term export credit program, increased Soviet grain purchase authorization to 15 millions tons, developed a risk assurance program, and expanded efforts to develop export markets around the world. This year we will continue these efforts, especially to reduce barriers to agricultural trade. Sugar To stabilize world sugar prices and to protect domestic sugar-producers, we negotiated an international sugar agreement this year with the major sugar producing countries. We will seek Congressional ratification of the agreement early in 1978. The sugar program required by the 1977 Food and Agricultural Act will protect the domestic sugar industry in the meantime. Rural Development and Credit Policy In fiscal year 1977, the Farmers Home Administration provided nearly $7 billion in loans in four areas: farming, housing, community facilities and business and industrial development. We expect to provide at least $1 billion more in the current fiscal year. SMALL BUSINESS This Administration took several steps in 1977 to strengthen small business. The Small Business Administration expanded its financial and management assistance to these firms and developed an advocacy program to represent small business interests before all Federal departments and agencies. In 1978, we will continue efforts to support small business through tax cuts and special tax incentives, reduced regulations and other programmatic reforms, and expanded SBA loan authority. MEETING OUR NATION'S HUMAN NEEDS This Administration's constant concern has been with meeting the human needs of all Americans. Over the past year, we have moved on a number of fronts to make certain our citizens will be well housed, better educated, and properly cared for when they are in need. This year we will pursue our current initiatives in these areas and launch new ones. HEALTH This past year we were very active in the effort to improve the health of our citizens and to restrain skyrocketing health care costs, through: —Establishment of a Mental Health Commission to help develop a national mental health program. The Commission will issue its final report later this year, and I expect to carefully consider the Commission's findings. —A campaign to immunize the more than 20 million children not yet protected against communicable childhood diseases. —Reorganization of part of HEW to allow more efficient delivery of Medicare/Medicaid services. The cost savings from the reorganizations will be realized more fully this year. —Signing legislation to attack fraud and abuse in Medicare/Medicaid programs. —Signing legislation to make Medicare/Medicaid reimbursement available to physician extenders in rural clinics. The beneficial effects of that bill will be felt in our Nation's rural areas for the first time this year. In 1978, the Administration will continue these and other efforts to bring us better and less costly health care. Hospital Cost Containment One of my main legislative goals for this year is the Hospital Cost Containment Bill. That bill, which would save hospital users more than $7 billion in the first two years after enactment, is our principal weapon in the effort to decrease health care costs, which now double every five years. National Health Insurance I will submit to Congress later this year a National Health Insurance proposal. While Congress will not have the time to complete action on this proposal in 1978, it is important to begin the national debate on the many complex issues involved in National Health Insurance. National Health Insurance will not solve all our health problems. A sensible national health policy also requires more effective delivery of preventive services, better nutrition, vigorous abatement of environmental and occupational threats to health, and efforts to change individual lifestyles that endanger health. But National Health Insurance is a crucial step. It will protect our people from ruinous medical bills and provide each citizen with better access to sound and balanced health insurance coverage. Medicaid Improvements for Children Last year I proposed the Child Health Assessment Program to improve the early and preventive screening, diagnosis and treatment program for lower-income children under Medicaid. The Administration will press for enactment of this measure, and will urge its expansion to make an additional 1.7 million lower-income children eligible. Teenage Pregnancy Proposal I will propose legislation to establish networks of community based services to prevent unwanted adolescent pregnancies. We need and will urge expansion of existing family planning services to reach an additional 280,000 teenagers. Drug Abuse Drug Abuse threatens the health and safety of our children, here and abroad. We will continue the efforts begun last year to make our drug abuse prevention and control programs more effective and efficient. World Health This year I will present a strategy for working directly with other nations and through international organizations to raise the standards of health and nutrition around the world. EDUCATION Last year the Congress adopted with our cooperation a 15% increase in education funding—the largest increase since enactment of the Elementary and Secondary Education Act. This year we will continue to demonstrate our commitment to improving the Nation's education programs. HEW's education budget expenditures will be increased by 14%, with the most significant increases coming in education of the disadvantaged, assistance to State programs for education of the handicapped, and college student financial aid. The Administration will also work with the Congress for the creation of a separate Cabinet-level Department of Education, and for legislation to replace and reform expiring Federal education acts. These legislative proposals will concentrate on: —increasing basic literacy; —ensuring that students are prepared for jobs; —supporting post-secondary education and lifelong learning; and, —strengthening the partnership between Federal, State, and local governments. To augment existing programs, I will propose legislation to help low and middle-income families meet rising college tuition costs, and will also support a significant expansion of student aid programs. INCOME ASSISTANCE Over the past year we have made many far-reaching improvements in the programs that provide income assistance to the needy. My Administration will continue to assign great importance to this area in 1978. Welfare Reform I proposed last year a reform of the Nation's welfare system, through the Better Jobs and Income Act. This Act would fundamentally reform current programs to assist the poor by: —consolidating the Aid to Families with Dependent Children, Supplemental Security Income and Food Stamps programs into a single consolidated cash assistance program that provides a basic nationally uniform Federal benefit; —improving efforts to find jobs for the poor in the private sector, and creating up to 1.4 million public service jobs for heads of families who cannot be placed in unsubsidized employment; and —improving work incentives by expanding the Earned Income Tax Credit. We will work actively with the Congress in the coming year to pass the Better Jobs and Income Act, and we will provide in this year's budget for pilot employment programs so we will be ready to implement the welfare reform program. Family and Children My Administration will continue its strong commitment to strengthening the American family and to expanding programs for children. The Administration will propose this year that the school breakfast program be made mandatory in schools with high concentrations of needy children. Further, we will propose a major expansion in special supplemental food programs for women, infants, and children. Among other major actions in 1978 will be: —convening a White House Conference on Families; —pressing for enactment of our proposed reforms in foster care programs including new financial assistance to aid in the adoption of hard-to-place children; —more than doubling the budget outlays for child welfare services, with an emphasis on services that help keep families together; —continuing $200 million in special funding for day care under Title XX of the Social Security Act. We will also depend upon the revitalized Community Services Administration to develop new approaches to assist the poor. THE ELDERLY Last year saw the enactment of Social Security financing legislation that will assure the system's financial integrity into the next century. This year the Administration will continue to work for strengthened legislation against unwarranted age discrimination in the Federal and private sector. We will propose legislation to extend and strengthen the Older Americans Act and we will seek a 13% increase in funding for programs providing daily meals to the elderly, raising the total of daily meals served to 385,000. In addition, the Administration will work to assure that the contributions of older Americans are sought in our efforts to meet national needs. HOUSING Last year we made progress toward our national goal of a decent home in a suitable environment for every American family. 1977 was a good year for housing, generally, with total new starts exceeding two million. And we have renewed the Federal government's commitment to housing for the needy. Early last year, the Administration proposed major new initiatives to meet the housing needs of low- and moderate-income Americans—initiatives which are central to our urban development strategy. We had about 118,000 starts under section 8 and public housing subsidized programs in 1977. We look forward to another 30 percent increase in subsidized housing starts in these programs for 1978, and 92,000 starts in the Assisted Housing Rehabilitation Loan Programs. We will reassess our national housing needs and goals and our current housing and credit policies designed to meet those needs. In 1978, the Administration will strengthen its commitment to meet the housing needs of all communities with a variety of expanded programs and new initiatives: —Rental housing assistance to an additional 400,000 low-income families, and help to enable an additional 50,000 moderate-income families to own their own homes. The total number of families receiving housing assistance will increase from 2.6 million in 1977 to 3.1 million in 1979. —More funds for the rehabilitation loan program under section 312, with an expansion of existing programs for substantial renovations and the creation of a new moderate rehabilitation program under section 8. —A major new operating subsidy program for 1979. This new program, coupled with improved management controls and the monitoring of troubled projects, is intended to reduce the inventory of defaulted projects and aid in restoring distressed urban areas. The Department of Housing and Urban Development has made substantial progress in 1977 in reducing the stock of defaulted projects. This new program will give the Department additional tools. Outlays for this program are estimated to total $52 million in 1979. —A Federal financing mechanism for assisted housing projects through use of the GNMA Tandem program. —A targeted GNMA Tandem program which will provide subsidies designed to bring middle-income families back to the cities. —Targeting of rural housing programs to lower-income residents, including a special program to help very poor families own their own homes. —Continuing high levels of production of housing for the elderly and handicapped. TRANSPORTATION This year we will build on the efforts we made last year to strengthen the Nation's transportation system by decreasing consumer costs, pursuing increased energy efficiency, and improving safety: —negotiation of a new US-UK bilateral air services agreement; —approval of new international air routes from a number of American cities; —requiring passive restraint systems on all new automobiles by 1984; —setting new fuel efficiency standards for 1981-1984 model automobiles; —beginning work on the Northeast Corridor Railroad Improvement Program; —passing an all-cargo airline deregulation bill. We will also continue our policy of increasing competition and reducing airfares in international flights, and pursue additional bilateral agreements. Consumers have already benefited from reduced international fares and improved service. Highway and Transit Programs We will soon propose a comprehensive highway and transit program, which will provide more than $45 billion in total authorizations in the 1979-1982 period. The program will give states and localities more flexibility in planning and programming their highway and transit funding, by reducing the number of narrow, categorical accounts and by using consolidated accounts for a wider range of potential transportation projects. In addition, we will make funding of transportation programs more uniform and give localities more control over highway and mass transit funds in large urban areas. Highway Safety The Administration will propose legislation to strengthen ore' efforts for highway safety and to reduce restrictions on the states' use of Federal highway safety grant funds. That legislation will earmark funds for the Department of Transportation to support important highway safety projects, such as the 55 mile per hour speed limit program. Inland Waterway User Fees Users of Federal inland waterways should pay fees which will pay a substantial part of the cost of constructing, operating and maintaining those waterways. My Administration will continue to work closely with Congress toward passage of a bill that will, for the first time, establish inland waterway user fees. Aircraft Noise Abatement My Administration will again seek passage of legislation to control aircraft noise. No-Fault Automobile Insurance We continue to support legislation to establish Federal minimum standards for no-fault automobile insurance. VETERANS In 1977, we took a number of steps to make certain that the country continues to meet the special needs of our millions of veterans. Legislation was passed to increase compensation benefits for service connected disabilities, benefits under the G.I. Bill, and veterans pension benefits. Millions of veterans will feel the effects of these increases this year. In 1978, we will further improve our veterans programs by: —initiating a government-wide review of the problems of Vietnam veterans and the means by which current programs can be made more effective in meeting their needs; —beginning new programs to deal with problems of alcohol, drug abuse and psychological readjustment; —proposing increased benefits for service-connected disabilities, and improvements in the veterans pension program; —continuing special employment programs for Vietnam-era veterans. ARTS AND HUMANITIES Americans are increasingly aware that the arts and humanities preserve and transmit our heritage, enrich our lives, and contribute significantly to the social and economic well-being of our Nation. This Administration is committed to fostering the highest standards of creativity and scholarship in an open partnership between public and private sectors—and we believe that the products of this commitment must be available to the many Americans who wish to share in them. This year's substantial increases in the budgets for the Arts and Humanities Endowments demonstrate my strong belief in the value of these programs. MAKING THE GOVERNMENT MORE EFFICIENT AND MORE RESPONSIVE GOVERNMENT EMPLOYEES Civil Service Reform The Civil Service System is too often a bureaucratic maze which stifles the initiative of our dedicated Government employees while inadequately protecting their rights. Our 2.8 million civil servants are governed by outdated rules and institutions that keep them from being as efficient as they would like to be. No one is more frustrated by this system than hard-working public servants. Therefore, one of my major priorities in 1978 will be to ensure passage of the first comprehensive reform of the system since its creation nearly a century ago—reforms developed with the direct involvement of civil servants. Early this year, Congress will receive legislation and a reorganization plan to: —restructure the institutions that run the Civil Service; —increase safeguards against abuses of official power; —provide greater incentives for managers to improve the Government's efficiency and responsiveness; —reduce the system's red tape and delays; —speed the procedures for dealing with employee grievances and disciplinary actions; —make equal employment opportunities more effective. Last year the Administration acted to protect Federal employees from the loss of a job due to reorganization. Such protection will be maintained. Hatch Act Reform I will continue to support reform of the Hatch Act, which would restore the right of most Civil Service employees to participate in the political process. Part-time and Flexi-time Employment To help obtain Federal jobs for the elderly, the handicapped, women, and others with family responsibilities, all Federal agencies will carry forward renewed efforts to increase part-time and flexi-time employment opportunities. REORGANIZATION, MANAGEMENT AND REGULATORY REFORM The Government Reorganization Project will keep working to make the Government more responsive and efficient. Last year we combined parts of 11 agencies into one Department of Energy, streamlined the Executive Office of the President and reduced the White House Staff, and proposed the abolition of nearly 500 advisory committees and small agencies. In addition to the upcoming Civil Service and education reform efforts, we will soon submit proposals: —to restructure our equal employment programs to provide better protection for the rights of minorities and women, and to ease the burden of compliance on State and local government as well as business; —to improve the administration of justice; and —to reorganize our disaster assistance programs. Additional studies are under way in many other areas, and several of these will result in reorganization proposals later this year. Efforts to improve Federal cash management continue. We are also vigorously pursuing the effort begun last year to reduce the burden of outdated, ineffective, and nitpicking regulations. For example, the Department of Health, Education, and Welfare eliminated 5% of their regulations, the Federal Trade Commission rescinded 111 outdated sets of rules on trade practices and both the Civil Aeronautics Board and the Interstate Commerce Commission have moved to allow more competition, which has led to lower prices. In 1978, we will continue these efforts. Worker Health and Safety The Occupational Health and Safety Administration has already slashed its paperwork requirements by 50% and eliminated 1,100 unnecessary regulations, while improving its capacity to protect workers. This spring the Task Force on Worker Safety will make further recommendations to increase protection for workers and minimize employer cost. Airline Regulatory Reform Last year, I signed legislation deregulating all cargo air transportation. This year, I will continue to work for passage of the airline regulatory reform bill for passengers. That bill will allow air carriers to compete through lower fares, new services, and new markets, without excessive government interference or disruption of service to small communities. Trucking Regulatory Reform Forty years of tight government controls have not done enough to bring us competitive prices, good service, and efficient use of fuel. We will consider measures to bring more competition into the motor carrier area. Drugs We will propose legislation to reform regulation of the drug industry, which will protect the consumer and make regulations fairer and less burdensome. Regulatory Process Early in 1978, I will issue an Executive Order to improve the regulatory process. This Order will require officials responsible for regulations to sign them; assure .that policy-level officials are fully involved in the process; require that regulations be written in plain English; make it easier for the public to participate in the process; increase coordination between agencies with overlapping responsibilities; require a closer look at the cost of regulations before they are issued; and require "sunset" reviews of existing regulations. I have also set up an interagency committee to help regulatory agencies review the economic effects of major regulations, so that we can be sure that the costs of each proposed regulation have been fully considered. In this way we will be able to identify the least costly means of achieving our regulatory goals. Paperwork Reduction In 1977, my Administration decreased by 12% the paperwork burden that the Government imposes on the people. This was done by eliminating, consolidating, simplifying, and decreasing the frequency of reports. That savings is the equivalent of 50,000 full-time workers filling out Federal forms for a full year. All departments and agencies are currently setting goals for further substantial reductions in 1978. All reporting requirements associated with grant-in-aid programs will be subject to "sunset" review and ended unless they are found necessary. In addition, we are reviewing the recommendations of the Commission on Federal Paperwork. LABOR LAW REFORM Last year we proposed legislation to reform our Nation's labor laws, in order to streamline the conduct of elections for employee representation and strengthen the enforcement powers of the National Labor Relations Board. We will work closely with Congress to ensure early passage of this bill, which is one of my highest legislative goals this year. ELECTION REFORM Last year, I supported proposals to make our elections fairer and more honest. These included public financing of Congressional campaigns, amendments to the Federal Election Campaign Act and other election reforms. The Administration will continue to support Congressional action on these measures. CONSUMER REFORM We have taken many actions to benefit consumers by reducing the costs and improving the quality and safety of products. But one consumer initiative merits separate emphasis—the creation of the Office of Consumer Representation. We supported legislation last year to create such an Office, so that the interests of consumers could be represented in one government agency. The Office would not require additional government employees or expenditures since it would merely consolidate the consumer offices that already exist throughout the government. I am strongly committed to this legislation, and regard its enactment as one of the year's primary legislative priorities. PUBLIC BROADCASTING REFORM I proposed legislation last year to strengthen the public broadcasting service by providing increased long-term Federal support, insulation from political pressure, better coordination among the national organizations that run public broadcasting, and more opportunity for citizens to participate at the local level. My Administration will work with Congress this year to pass these reforms. OPENNESS AND INTEGRITY One of our primary goals is to make certain that the government's ethical standards are high, and that they are fully observed. And we must ensure that our government is open and responsive to the American people. Last year, I took steps in that direction by requiring that the senior officials of my Administration publicly disclose their income and assets and pledge not to do business with their agencies for two years after leaving government service. To increase the government's openness, we took steps to make certain that the as well as the letter of the Freedom of Information Act was observed. And we tried to bring the Presidency to the people with citizen forums and discussion panels throughout the country. This year, we will continue these efforts, concentrating our primary attention on these areas: Lobby Reform The Administration will press for legislation requiring registration of lobbyists and thorough public disclosure of their lobbying activities. This long-overdue legislation will help reestablish confidence and trust in government. Ethics I applaud the strong ethical codes adopted last year by the House and Senate. I believe those codes and the standards established for my Administration's officials should be made law, so that they will clearly apply to public officials in the future. I urge Congress to pass the Public Officials Integrity Act this year. Classification We are completing a study of classification systems for government documents and I will shortly issue an Executive Order designed to eliminate improper and unnecessary classification and to ensure that documents are declassified more rapidly. JUSTICE Civil Rights and Equal Opportunity All Americans have fundamental civil rights requiring government protection., and all must be afforded equal opportunities to participate as full members in our society. In 1977, this principle guided my Administration in numerous areas, and I plan to make certain that this year our efforts on behalf of civil rights and equal opportunities continue unabated. Our Nation's concern for human rights must be heard as clearly at home as abroad. Educational Opportunities In 1977, my Administration vigorously attacked educational discrimination on the elementary, secondary and higher education levels. A major suit was pursued to ensure non-discrimination at the university level. At the same time, we recognized and reaffirmed the importance of affirmative action programs to ensure equal opportunities at educational institutions through our brief in the Bakke case. Our efforts to eliminate discrimination and promote affirmative action programs, relying on flexible goals rather than on quotas, will continue in full force. Handicapped HEW issued regulations and guidelines to implement legislation guaranteeing equal access to programs receiving financial assistance from HEW. This year the other Cabinet Departments will issue similar regulations, so that the rights of handicapped Americans will begin to be fully observed. We are providing a $50 million loan fund to States and institutions to enable them to comply with these regulations and to eliminate barriers which prevent access by our handicapped citizens to federally assisted programs and activities. We are proposing a major increase in funding under the Education of all Handicapped Children Act. Equal Opportunity This past year the Administration reaffirmed Executive Order 11375, which prohibits discrimination on the basis of sex in Federal employment. In addition, I voluntarily placed the Executive Office of the President under Title VII of the Civil Rights Act. This year, as part of our effort to eliminate sex discrimination in unemployment and education, I will continue to urge the ratification of the Equal Rights Amendment to the Constitution. This past year the Equal Employment Opportunity Commission was reorganized to increase its efficiency. As a result, the Commission made substantial progress on reducing its backlog of complaints. With the more than 40% increase in funding that will be proposed in the 1979 budget, the EEOC will be able to further reduce its backlog. Early this year I will propose to Congress a reorganization plan concerning equal opportunity enforcement which will strengthen the EEOC. Anti-Foreign Boycott I strongly supported, and signed, legislation to prohibit American participation in secondary economic boycotts by foreign countries. That law will be strictly enforced by my Administration this year through the regulations just issued by the Department of Commerce. Minority Business Last year, we started a number of programs to make more opportunities available for minority-owned businesses. That effort will be continued and strengthened this year: —We are half way toward our two year goal of $2 billion in Federal purchases of services and goods from minority-owned firms. We will reach that goal by the end of the year. —We will raise the goal for Federal deposits in minority-owned banks above the 1977 level of $100 billion. —We will continue to enforce the $400 million minority business set-aside provision in the local public works act, and may exceed that target. —We will continue to implement the minority business set-aside policy established for contracts let in the North- east Corridor Railroad Improvement Program. Undocumented Aliens Last year, I proposed legislation to impose sanctions on employers who hire undocumented aliens and to change the legal status of the many undocumented aliens now residing in this country. That legislation would afford undocumented aliens residing here continuously since before 1970 the opportunity to apply for permanent resident status. It would create a new five-year temporary resident status for those undocumented aliens who resided here continuously from 1970 to January 1, 1977. I want to work with Congress this year toward passage of an undocumented aliens bill, for this social and economic problem can no longer be ignored. Native Americans The Administration has acted consistently to uphold its trusteeship responsibility to Native Americans. We also have elevated the post of Commissioner of Indian Affairs to the level of Assistant Secretary of Interior. In 1978, the Administration will review Federal Native American policy and will step up efforts to help Indian tribes assess and manage their natural resources. LEGAL AND JUDICIAL REFORM Last year, my Administration began a number of major efforts to improve our Nation's legal and judicial system, and we intend to pursue those and related efforts fully this year. Criminal Code Reform We have worked closely with members of Congress to develop a proposed revision of the Nation's Criminal Code. That revision will codify in one part of the YOU.S. Code all Federal crime laws and will reform many outdated and inconsistent criminal laws. My Administration will work closely with Congress this year to seek passage of the first complete codification of the Nation's criminal laws. Judicial Reform The Federal judicial system has suffered for many years from an inadequate number of judges, and we will continue to work with Congress on an Omnibus Judgeship Bill to correct this problem. We will also continue our efforts to use our judges more effectively, through legislation which we have proposed to expand significantly the authority of magistrates, to increase the use of arbitration, and to tighten Federal jurisdiction. We will work this year to complete Congressional action on these bills. Wiretap Reform Last year we proposed legislation reforming our approach to electronic surveillance for foreign intelligence purposes, and affording greater protection to our citizens. Essentially, that legislation would require the government to obtain a court order before beginning any foreign intelligence wiretaps in this country. My Administration supports early passage of this much needed legislation. Anti-trust Enforcement and Competition Our Nation's anti-trust laws must be vigorously enforced. Therefore, I recently established a Presidential Commission to review Federal anti-trust enforcement, and to make its recommendations this year. Last year, we initiated a new program, administered by the Department of Justice, to provide grant funds to State Attorneys General in order to strengthen anti-trust enforcement at the State level. We expect to see the results of this program this year. By reducing government regulation, we can increase competition and thereby lower consumer costs. This year we will continue our deregulatory efforts in the legislative and administrative areas in order to reduce anti-competitive practices and abuses. Crime Reduction and Criminal Justice This past year the Reorganization Project and the Justice Department have been developing proposals to reorganize and to improve our Nation's criminal justice system, in order to strengthen enforcement and ensure equal justice. This year I will be sending a Message to Congress on criminal justice and crime reduction. My Message will include proposals to: —reorganize the Federal Law Enforcement Assistance Administration; —improve our criminal research efforts; —develop better law enforcement methods against organized crime, white collar crime, drug abuse, and public corruption; and —develop minimum standards for Federal correctional institutions. FBI and Intelligence Agencies' Charters I plan to issue a comprehensive Executive Order to govern the intelligence activities of the FBI, CIA, NSA and the Defense Department. That Executive Order will be the basis for the Administration's recommendations on legislative charters governing the activities of the FBI and various intelligence agencies. Privacy The Privacy Protection Study Committee recently proposed an extensive list of new legislative and regulatory safeguards. My Administration is analyzing these recent proposals and will develop this year a program to ensure that personal privacy is adequately protected. District of Columbia We proposed last year a series of reforms, including full voting representation in Congress, designed to give the residents of the District significantly greater control over their local affairs. My Administration will continue to work for the passage of those reforms this year. DEVELOPING AND PROTECTING OUR NATURAL RESOURCES ENERGY National Energy Policy In April 1977, I proposed to the Nation a comprehensive national energy policy. That policy is based on three principles, which will continue to guide our progress in 1978: —we must learn to use energy more efficiently and more carefully, through conservation measures, including retrofitting our buildings, factories and homes; —we must shift from oil and natural gas, which are becoming more scarce, to coal and renewable sources of energy which we have in abundance; —we must provide fair prices to producers of energy, so as to encourage development of new supplies without permitting windfall profits. The debate on this comprehensive policy has been long and arduous. A number of difficult, contentious issues remain to be settled. I am confident, however, that the Congress recognizes the seriousness of our energy problem and will act expeditiously on this program early this year. Securing passage of an acceptable energy bill—one which is fair to consumers, provides needed energy savings, and is prudent from a fiscal and budgetary standpoint—will continue as our highest and most urgent national priority in 1978. Energy Statutes and Actions We have already begun to lay a strong foundation for implementation of a national energy policy. In 1977 we took steps to put in place important policies and structural reforms needed to meet our energy goals: —Creation of a new Department of Energy which combines, for the first time, major governmental functions of energy research, regulation, pricing policy, information collection and dissemination, and overall policy development. Without a strong organization, we would not hope to implement a comprehensive national policy. —Congress has approved our proposed route for a pipeline to bring natural gas from the North Slope of Alaska to the lower 48 states. —Passage of the Emergency Natural Gas Act to cope with the hardships of last winter's freeze and assure that high priority gas users were not cut off during supply emergencies. —Funding of more than $4 billion to store the first 500 million barrels of oil in a strategic petroleum reserve. We have already begun to fill that reserve, and we remain committed to a 1 billion barrel strategic reserve by 1985. Outer Continental Shelf Legislation Legislation to improve the management of the Outer Continental Shelf for oil and gas development is a major item of unfinished business pending before Congress. Prompt passage is necessary so that we can have the benefit of the new law as we move to open more offshore areas to development and production. This bill mandates long-needed reforms in the leasing program to provide for the necessary development of offshore oil and gas while enhancing competition among oil companies, assuring that the public receives a fair return for the sale of the public's oil and gas resources, and protecting our marine and coastal resources. Nuclear Energy The United States has also advanced a policy to prevent the proliferation of nuclear weapons around the world. An International Nuclear Fuel Cycle Evaluation has been established with wide international participation to examine alternatives to existing proliferation-prone technologies. In addition, legislation was proposed last year to establish better controls on export of nuclear fuels and technologies. We will work with Congress to secure passage of that legislation early in 1978. Our commitment to preventing the spread of nuclear weapons has led us to reorient our own domestic nuclear policies. I have deferred indefinitely the commercial reprocessing of spent nuclear fuel and plutonium recycling. The Clinch River Plant itself would waste more than $2 billion while teaching us little that we do not already know, or cannot learn from our existing nuclear research and development program. I have recommended that the Clinch River Breeder Project be stopped, because it represents a premature and unwise commitment to commercialization of technology that we do not now need. However, we intend to continue to develop the nuclear energy the Nation needs. We will continue to move forward with a major research program on breeder technology. We will begin to implement our program for government management of spent fuel from nuclear reactors. In 1978, my Administration will work towards a policy for safe, permanent disposal of nuclear wastes. In 1978 and beyond, we will carry on a vigorous nuclear research and development program designed to give us safe technologies that will reduce the danger of nuclear proliferation and will be environmentally responsible. We will also seek to improve the current system of licensing nuclear power reactors in order to cut bureaucratic delays, while firmly maintaining and strengthening health, safety and environmental requirements. I will propose nuclear licensing legislation to the Congress this year. ENVIRONMENT One of my deepest personal commitments is to a clean, healthy environment for all of our citizens. Last May, I outlined this Administration's environmental priorities and policies in a comprehensive Environmental Message. Working closely with the Congress, we have made good progress on many of the measures contained in that Message; it will continue to guide our administrative and legislative actions in 1978. Overall, we will: —increase our environmental outlays by more than 10%, and provide the new staff resources necessary to ensure that the Nation's environmental laws are obeyed; —determine the best way of enforcing the landmark environmental statutes enacted in 1977, taking considerations of science and public policy into account; —pursue several important initiatives, including a National Heritage program and designation of national interest lands in Alaska, to manage our precious natural resources better and to preserve our heritage. Environmental Statutes In 1977, we worked closely with Congress to enact three of the most significant environmental statutes in recent years: —The Surface Mining Control and Reclamation Act establishes a joint Federal-State program to make sure we use economically and environmentally sound strip-mining practices. It also sets up a fund to reclaim lands which have been ravaged by uncontrolled, careless mining, and provides clear, stable policy direction for operators. —The Clean Air Act Amendments establish strict but achievable standards for auto emissions and ensure continued progress in reducing pollution from stationary air pollution sources. —The Clean Water Act authorizes many of our most important water cleanup programs and will protect our Nation's wetlands without unnecessary Federal requirements. The Act also reforms the sewage treatment construction grant program and gives strong emphasis to the control of toxic chemicals in our environment. We will provide the leadership and the funding necessary to carry out these new laws. Water Policy In 1977, an effort was begun to ensure that Federal programs and policies provide sound and fair management of our limited and valuable water resources. We. began a complete review of Federal water policy, which will be completed this year. After close consultation with the Congress, the States, and the public, we will propose measures needed to carry out the recommendations of that study. We will also continue with the strong dam safety inspection program which was initiated late last year to make sure our dams, public or private, are safe. Alaska Lands Last year, I sent Congress a proposal for use of Federal lands in Alaska. This proposal will protect 92 million acres for the public, will create or expand 13 national parks and reserves, 13 national wildlife refuges, and will confer wild and scenic river status on 33 waterways. I hope Congress will adopt these measures, which are needed this year to preserve the unique natural treasures of Alaska and, at the same time, permit the orderly development of Alaskan resources. Redwood National Park Redwood National Park contains some of the Nation's largest and oldest trees. Last year, to protect these trees from destruction by commercial logging at the edges of the Park, legislation was proposed to expand its boundaries. We will press for Congressional action on this bill in 1978. National Heritage Program We will shortly be proposing a Federal-State program to preserve unique elements of our natural and cultural heritage. This program, modeled after successful ones in several states, will be administered by the Department of the Interior. Although many of the necessary steps can be taken administratively, we will seek some new legislative authority in 1978. Federal Compliance with Environmental Laws My Administration is committed to the principle that the Federal government must set a good example of compliance with those environmental laws and regulations which have been established for the private sector. So far, unfortunately, the Federal record has been found wanting. My 1979 budget includes money to bring Federal facilities into compliance with existing environmental laws and regulations. Federal Reclamation In 1977, we began a thorough review of the 1902 Reclamation Act. After the study has been completed and reviewed this year, I will propose to Congress any changes needed to modernize the law. Mining Law Reform Last year the Administration proposed legislation to replace the archaic 1872 Mining Law with a modern leasing system for publicly-owned mineral resources. The 1872 system has resulted in withdrawal of large areas of land from mineral exploration as the only tool for environmental protection. The Administration's proposal would establish a balanced system where the public interests in mineral development, environmental protection and revenue to the YOU.S. Treasury will all be accomplished. Special provisions would minimize burdens on small operators and provide incentives for exploration. Oil Spills Last year I proposed to Congress legislation which would establish strict liability standards for oil tanker spills and would improve regulations aimed at preventing future oil spills. That legislation is still needed. SCIENCE AND TECHNOLOGY The health of American science and technology and the creation of new knowledge is important to our economic well-being, to our national security, to our ability to help solve pressing national problems in such areas as energy, environment, health, natural resources. I am recommending a program of real growth of scientific research and other steps that will strengthen the Nation's research centers and encourage a new surge of technological innovation by American industry. The budget increase of 11% for basic research will lead to improved opportunities for young scientists and engineers, and upgraded scientific equipment in the Nation's research centers. I am determined to maintain our Nation's leadership role in science and technology. We will continue America's progress in the field of space exploration with continued development of the space shuttle system and procurement of four shuttle orbiters for operations from both East and West coasts, development of a spacecraft to study for the first time the polar regions of the Sun, and increased outlays for demonstrations of the practical applications of space-based systems and development of space technology. FOREIGN AFFAIRS A year ago I set five goals for United States foreign policy in the late 1970's and early 1980's: to reassert America's moral leadership; to strengthen our traditional ties with friends and allies; to work toward a more just international system; to promote regional reconciliation; and to preserve peace through preparedness and arms control. These goals continue to underlie my agenda for 1978. MORAL LEADERSHIP During the past year, we have placed American foreign policy on a new course consistent with the values and highest ideals of the American people. We are trying to limit the worldwide sale of arms; we are trying to prevent nuclear explosives—and the ability to make them—from spreading to more countries; we are building .a new relationship with the developing countries, and we are promoting human rights throughout the world. Human Rights Virtually everywhere, human rights have become an important issue—especially -in countries where they are systematically violated. There has been real progress, and for that the United States can take some credit. We have taken the lead among Western nations at the Belgrade Review Conference on Security and Cooperation in Europe. Working closely with our Allies, and with neutral and non-aligned nations, our delegation—led by Ambassador Arthur Goldberg—has conducted a thorough review of implementation of the Helsinki Final Act, in all its aspects. We have made clear the United States is committed to the full implementation of the Final Act in this and other areas. We will seek a further Review Conference in two years; meanwhile, we will press for better implementation of the Helsinki Final Act. Non-Proliferation We must not ignore the enormous dangers posed by the unrestrained spread of nuclear weapons technology. We recognize the benefits of commercial nuclear power, but we also must acknowledge the risks. We believe that all countries can enjoy the benefits, while the risks are minimized, by developing safer technologies and creating new institutions to manage and safeguard all phases of the nuclear fuel cycle. Meanwhile, we have decided to postpone a premature commitment to technologies we cannot yet safely manage on a commercial scale; and we are seeking to persuade others that there are sound economic and energy reasons for them to do likewise. Arms Sales The world is threatened by the spiraling increase in trade of conventional arms. Not only do these arms increase the likelihood of conflict, they also divert resources from other human needs. It will not be easy to slow this spiral. We will begin to cut back on our own sales in recognition of the fact that, as the world's principal seller, we have a duty to take the first step. But we know that our efforts can only succeed if other major arms suppliers and recipients cooperate. TIES WITH FRIENDS AND ALLIES The energy crisis has underscored the reality of interdependence among nations and the need for a stable international financial and trading system. Our own actions reflect the belief that consultations with traditional friends and dialogue with developing nations are the only way that the United States can provide the economic and political leadership which the world expects of us. Working with the Allies During the past year, the United States restored our traditional friends and allies to the center of our foreign policy. Within days after his inauguration, the Vice President visited Brussels, Rome, Bonn, Paris, Reykjavik, and Tokyo. I met frequently in Washington with European and Japanese leaders. I participated in the Economic Summit in London, the 1977 NATO Summit, and a Four-Power Summit with leaders of Britain, Germany, and France. At the beginning of 1978, I visited France and Belgium—and while in Brussels, made the first visit by an American President to the headquarters of the European Community. We have also consulted with our European Allies on such diverse subjects as SALT, MBFR, the Middle East, Africa, human rights, the Belgrade Conference, energy, nonproliferation, the global economy, and North-South relations. We will intensify these efforts this year, expanding the list to include close consultations with the Allies on major arms control issues. On May 30-31, we will host a NATO Summit in Washington, and we are also planning another Economic Summit this year. We have shown in our dealings with Japan that close allies can find solutions to shared problems. Early in the year, we were concerned about nuclear reprocessing in Japan, but through flexibility and goodwill on both sides a suitable accommodation was reached on the building of a nuclear reprocessing plant there. Most recently, we reached agreement with the Japanese on ways to deal with their large current account surplus. Our trade and economic talks are another example of constructive action. International Economic Cooperation We are working to improve and extend the international economic system, to strengthen international economic institutions, and to ensure that international economic competition takes place in an orderly fashion. We will seek to improve cooperation among nations in the IMF, the GATT, the World Bank, the OECD, and other international organizations which have enabled us to maintain an open, liberal, trade and payments system. The American economy remains strong. Our competitive position in international trade is excellent. In 1977 our merchandise exports exceeded imports (except for oil) by a large amount. Our inflation rate is among the lowest in the industrial world. But our balance of trade and payments incurred a large and worrisome deficit. There were two main causes: —In 1977, $45 billion flowed out to pay for imported oil. This wiped out what would otherwise have been a trade surplus. —The demand here for foreign goods was much greater than the demand for American goods abroad. In 1977, American GNP increased roughly twice as fast in real terms as the GNP of our main trading partners. Against this background, the exchange rate of the dollar declined relative to the currencies of Japan, Germany, Switzerland, and other European countries. These developments led to disorderly conditions in the exchange markets. In December I made clear that the United States would intervene to counter these disorders, and we have done so. To assure the integrity of the dollar we must act now: —We need a healthy and growing United States economy, with adequate investment, a prudent budget, and declining inflation. This will make us more competitive and more attractive to foreign investors. —We need to conserve energy and develop alternative sources of supply. This will reduce our dependence on imported oil, and cut the outflow of dollars. —We need to see a more vigorous world economy. Stronger growth, particularly in countries like Germany, Japan, Switzerland, and the Netherland, can help reduce our own deficits and bring stability to international payments. Factors already at work will reduce our trade deficit. Economic activity in Europe and elsewhere should rise. Our oil imports should level off this year. The effect of new exchange rates that have already occurred will, when their full effect is realized, improve our trade balance by several billions of dollars. While our trade and payments deficit in 1978 will be large, our external position should show some improvement. We must also augment our capacity to deal with possible strains and pressures by strengthening our international trade and monetary system. I urge the Congress to act promptly to approve United States participation in the IMF's Supplementary Financing Facility. The trading nations of the world are engaged in negotiations to reduce barriers and improve the international trading system by a reciprocal and balanced opening of markets. Freer trade will enable us all to use the world's resources more efficiently and will contribute to economic growth. We will also attempt to strengthen the rules that have regulated international trade during the last 30 years. International competition must take place within a framework of agreed rules that are recognized as appropriate and fair. THE DEVELOPING COUNTRIES One of the most critical issues facing the United States is our economic and political relationship with developing countries. Our economy has become visibly dependent on the developing world for supplies and markets. North-South Dialogue Throughout 1975 and 1976 the United States and other developed countries worked with a group of developing nations in the Conference of International Economic Cooperations (CIEC). That "North-South Dialogue" reached agreement on some issues in June 1977, but there remain a number of unresolved questions. The United States will continue to consult and negotiate with developing countries on questions like commodity price stabilization, technology, and a common fund for international buffer stocks. We will pursue the North-South dialogue in the months ahead, confident that the developed nations and the developing nations can agree upon measures that will let all nations participate more fully in the management of the world economy. Africa Our relations with Africa involve energy, human rights, economic development, and the North-South dialogue. The Maputo and Lagos Conferences demonstrated that African countries can discuss difficult problems with us, to mutual advantage. Our relations with Nigeria have improved dramatically. The Administration's FY 79 budget substantially increases development assistance to Africa, including continued support for the African Development Fund, and other programs to help African governments meet their people's basic human needs. The growth of African regional institutions like the Sahel Development Fund is important to African development. Latin-America/Caribbean The Administration's approach to Latin America and the Caribbean recognizes this region's diversity. We have placed great importance on the protection and defense of human rights, on halting the proliferation of nuclear weapons capabilities, on restraining conventional arms sales, on contributing to the settlement of disputes, and on engaging Latin governments in global economic negotiations. We are now seeking Senate ratification of Protocol I of the Treaty of Tlatelolco, and the American Convention on Human Rights. Through the Caribbean Group, we are trying to promote regional development. And we intend to help several nations develop alternative energy sources. Panama General Torrijos and I signed the two Panama Canal Treaties on September 9 [7], 1977. These treaties meet the legitimate interests of Panama and the United States and guarantee our permanent right to protect and defend the Canal. They will contribute importantly to regional stability. Asia The United States has sought to underline our desire for a close relationship with the developing countries of Asia through my visit to that continent and through regular contacts with the member countries of the Association of Southeast Asian Nations. We welcome the cooperation with ASEAN of the developed countries of the region, such as Japan and Australia. PROMOTING REGIONAL RECONCILIATION The greatest danger to world peace and stability is not war among the great powers, but war among small nations. During the past year, the United States has helped to promote productive negotiations in two troubled regions: the Middle East and Southern Africa. We have also tried to settle conflicts in the Horn of Africa and on Cyprus. And we have negotiated two Panama Canal Treaties that will enhance our country's relations with all the nations of Latin America. The Middle East In an effort to break with the rigid approaches of the past and bring about an overall peace settlement, I have looked to three basic principles: normalization of political, economic and cultural relations through peace treaties; withdrawal of armed forces from occupied territory to recognized and secure borders and the establishment of effective security measures; and a resolution of the Palestinian question. Significant progress toward peace in the Middle East was made last year; we particularly applaud President Sadat's courageous initiative, reciprocated by Prime Minister Begin, in launching direct negotiations. The United States will continue this year to encourage all parties to resolve this deep-seated conflict. Southern Africa The entering Administration inherited problems in Rhodesia, Namibia, and South Africa. —With the British, the United States launched new Rhodesian discussions last year. The Anglo-American Plan of September 1 sets forth fair and workable principles for majority rule: a transition period leading to free elections, a UN presence, a constitution with a judicially protected bill of rights, and a Zimbabwe Development Fund. —The five-power Contact Group, in which the United States participates, has held discussions with South Africa and with the Southwest Africa Peoples Organization and other interested parties on an internationally acceptable settlement for an independent Namibia under majority rule. This effort has produced wide agreement, including provisions for a substantial UN presence. —The United States has told the South African Prime Minister that unless his nation begins a progressive transformation toward full political participation for all its people, our relations will suffer. We supported a Union Nations arms embargo on South Africa, prohibited "gray area" sales, and began a review of us/ South African economic relations. The Horn of Africa Arms supplied by the Soviet Union now fuel both sides of a conflict in the Horn of Africa between Somalia and Ethiopia. There is a danger that the Soviet Union and Cuba will commit their own soldiers in this conflict, transforming it from a local war to a confrontation with broader strategic implications. We deplore the fact that disagreements in this region have grown—with the assistance of outside powers—into bloody conflict. We have made clear to both sides that we will supply no arms for aggressive purposes. We will not recognize forcible changes in boundaries. We want to see the fighting end and the parties move from the battlefield to the negotiating table. Cyprus We hope that the groundwork was laid in 1977 for a permanent settlement in Cyprus and we are encouraging movement in that direction. PRESERVING PEACE During the past year, the Administration has assessed the threats to our own and our Allies' security, as well as our collective strength to combat these threats. We have sought to promote responsible arms control efforts and to reduce competition in arms. Recognizing that a strong defense is the foundation of our security, we have made certain that our defense spending will be sufficient and used to maximum effect. Arms Control The fundamental purposes of our arms limitations efforts are to promote our own national security and to strengthen international stability, thereby enhancing the prospects for peace everywhere. —We are trying to move the Strategic Arms Limitation Talks toward more ambitious objectives. We want to reduce, not just contain, the competition in the number of strategic weapons possessed by the United States and the Soviet Union, and to limit qualitative improvements in weapons which merely raise the risks to all of us. Precisely because of our determination to obtain both of these objectives negotiations have been difficult and prolonged. However, I am confident that the agreement that we will present to the Congress will meet them. —We have also made solid progress toward an objective that the United States has pursued for many years: a comprehensive treaty banning all nuclear explosions. This treaty will be open to all nations of the world. It will be a major step toward reduced reliance on these weapons and toward halting their further spread in the world. —At the same time we are seeking arms limitations agreements with the Soviet Union that will contribute to security and stability in various regions of the world. In Europe we and our NATO Allies are seeking a mutual and balanced force reductions agreement that will achieve greater stability and balance at lower levels of forces. In the Indian Ocean, where neither we nor the Soviet Union has yet deployed military power on a large scale, we are working for an agreement to prevent a major military competition. —For the first time, we have begun to negotiate with the Soviet Union the outlines of a treaty banning chemical warfare. —An essential element of American security is the maintenance of stability in the Western Pacific, where the United States plays a major role in maintaining a balance of power. We are seeking to readjust our military presence in Korea by reducing our ground forces on the Peninsula and undertaking compensatory measures to ensure that an adequate balance of forces remain. We are talking with the Filipino government about the future of our military bases there. —We are continuing the process of normalization of our relations with the People's Republic of China within the framework of the Shanghai Communiqué. —In the last year, we have sought to halt the worldwide spread of nuclear weapons capacity. Nearly 40 nations have joined with us in an effort to find nuclear power sources that cannot be readily used for building nuclear weapons. Defense Posture/Budget The defense budget that I am recommending to Congress will fulfill our most pressing defense needs. I am requesting increases in defense spending that more than compensate for inflation. They are needed to maintain an adequate military balance in the face of continued Soviet military efforts. —As we negotiate with the Soviets over strategic arms, we are continuing to preserve essential equivalence in strategic nuclear strength. Here our technological advantage over the Soviet Union is most apparent. We are building cruise missiles, which together with upgraded B-52s will assure the capability of this element of our Triad. We are continuing to develop the M-X missile system in case we need to deploy them. In this budget, I am requesting funds for continued increase in our Trident submarine force, which is our most important strategic program because submarines are so hard for any enemy to destroy. —With our NATO Allies we are trying to improve the initial combat capability of NATO forces. We will improve the readiness of critical combat units, enhance American capability to send ground and tactical air forces reinforcements, and increase our permanent forces there. To lay the foundation for future improvements, the budget I propose requests 18% increases in the procurement of equipment for the Army. The United States is not taking these steps alone; we are participating in a mutual effort. —The importance of sea forces to United States national security is undisputed. The Navy receives the largest share of the defense budget, and I am requesting funds to continue its modernization. But, we need to examine the appropriate size and mix of United States naval forces in the future. Therefore, I have deferred spending for new aircraft carriers until a current Defense Department study is completed early this year. While we maintain our naval strength, we should have the capability to deploy rapidly a light but effective combat force worldwide, if necessary, without overseas base support. To this end, I am requesting funds for a vigorous airlift enhancement program. In these and other ways, we are seeking to develop a foreign policy which is wider in scope; a foreign policy which recognizes global diversity; and a foreign policy which builds a more just and stable international system. JIMMY CARTER The White House, January 19, 1978.
tonight state of the union address concentrates on this year highest strong energy bill a coordinated economic program of job creation tax reduction tax reform and measures making the government more effective and efficient maintaining the peace through a strong national defense and ratifying both the panama canal treaties and if completed the salt ii treaty it is important that the congress and the nation also understand what our other important initiatives and goals will be for 1978 i am therefore sending to congress this separate more detailed state of the union message which describes administration priorities in the areas not fully covered in the address domestic affairs a number of serious domestic problems faced the nation when i took office one year ago the economy had not yet fully recovered from the recession our country had no sound energy policy the federal government was operating inefficiently and ineffectively in many areas concerns about the openness and integrity of our government remained in the aftermath of watergate and many of our most pressing social problems had not been addressed in 1977 my administration did not solve all of those problems but congress joined us in tackling many of these issues and together we made progress now that a year has passed i believe we are a more confident people with more trust in our institutions we are a country on the move again prepared to address our problems with boldness and confidence at home and abroad we have reasserted our concern for the problems of people here at home and reaffirmed our position of moral leadership in the world this year my domestic goals will continue to reflect those concerns that guided my actions in 1977 restoring economic prosperity meeting our nation human needs making the government more efficient and more responsive and developing and protecting our natural resources restoring economic prosperity i am devoting a substantial part of my state of the union address to the need for a comprehensive economic program and i will devote the bulk of my economic report to congress to be delivered tomorrow to a complete description of my administration economic goals and objectives in this message therefore i will not repeat those statements but i want to set forth briefly the key elements of those proposals 23 billion income tax cut in 1979 with 17 billion going to individuals and their families and 6 billion going to businesses tax reform program designed to make our tax laws fairer and simpler program designed to reduce annual increases in wages and prices with the cooperation of labor and business and with the federal government setting an example reductions of 2 billion in excise and payroll taxes will also make a contribution to reducing inflation extension of the funding for public service ceta jobs and a 700 million increase in spending for our youth employment efforts major new 400 million private sector jobs initiative designed primarily to encourage businesses to hire unemployed minorities and youth i plan to work very closely with congress to secure prompt action on these economic proposals their adoption will help achieve the kind of economic prosperity for our nation that all of us want along with a sound energy bill enactment of these economic proposals will be my highest domestic priority for 1978 energy there can be no higher priority than prompt enactment of comprehensive energy legislation along the lines submitted to the congress last spring huge oil price increases in contributed to the inflation of 1974 and to the worst recession in 40 years these price hikes were also the principal because of our foreign trade deficit which has contributed to the weakness of the dollar abroad unless we act now our energy problems will rapidly get worse failure to act will fuel inflation erode the value of the dollar render us vulnerable to disruptions in our oil supply and limit our economic progress in the years to come i am confident that the congress will respond to the nation clear need by enacting responsible and balanced energy legislation early this year employment last year we made considerable progress in our efforts to reduce unemployment the unemployment rate decreased from to during the year million new jobs were created unemployment fell by million workers the actions we took as part of our 21 billion economic stimulus package substantially helped us achieve these favorable results in 1978 the administration will continue its efforts to reduce unemployment still further and to increase employment opportunities for all americans as part of the budget i will propose funds to increase youth programs 260 above the 1976 level providing billion in outlays and of employment and training for young workers 400 million private sector employment program focused on youth and other disadvantaged workers and aimed at mobilizing private industry to work with government in finding jobs it will be implemented through business councils established throughout the country of the ceta jobs through 1979 while tying them in future years to national unemployment rates beginning of a demonstration program for the jobs component of the better jobs and income program legislation the administration will seek passage of the full employment and balanced growth act this act will help the administration and the congress in planning our efforts to reduce unemployment and to create jobs while maintaining reasonable price stability its enactment would serve as a living memorial to the late senator hubert humphrey private sector jobs the administration plans a major 400 million effort to involve business and labor in the training and hiring of the unemployed the program will closely tie the federal employment system with the private sector through the use of business councils i am confident that the private sector will respond positively to the call to help the nation solve one of its most serious problems the employment of our youth and minorities inflation although inflation is lower now than in the recent past we still must do more to keep it down the steps my administration will take include for business investment contained in our tax proposals which will increase productive investment and thereby help us hold down prices and costs in excise and unemployment taxes proposed in the new budget reductions in needlessly complex federal regulations we have established a interagency committee to review the effects of regulation in our economy and we will continue our efforts for regulatory reform in the airline industry and elsewhere special effort to hold down the soaring costs of health care through enactment of the hospital cost containment act but the government can not solve this problem alone especially once business labor and consumers have accel ted inflation as a fact of life and adjusted their behavior accordingly i have therefore asked business and labor to undertake voluntarily a new program to reduce inflation i will ask each industry to aim for smaller price and wage increases in 1978 than it averaged over the last two years as a major employer the federal government should take the lead in this effort voluntary cooperation is one the only reduce inflation without unacceptable government interference and coercion urban assistance and community development the administration and congress took major steps last year to meet the needs of our cities we increased funding for community development block grants by billion over three years and provided an alternative formula for allocating funds that was more responsive to the needs of distressed urban areas next year we will recommend an increase of 150 million over the 1978 level for the community development block grant program we enacted a new program of urban development action grants at an annual level of 400 million and extended and expanded fiscal assistance arfa i am proposing that the arfa program which expires september 30 1978 be extended we are evaluating possible revisions in programs and funding and will make our recommendations to the congress within two months the administration is also studying closely the possible need for extended federal lending to new york city the current legislation expires on june 30 1978 we are committed along with the state and city to preserving the city solvency if such extended lending is necessary for that purpose we will propose it however all the interested parties must contribute to a permanent solution this spring i will submit to congress a message outlining this administration urban policy based on the work of the urban and regional policy group chaired by the secretary of housing and urban development it will be designed to make existing federal programs more effective and will involve new initiatives and resources to address our urban needs the problems of our cities are structural in nature and can not be corrected by or efforts this administration is committed to a and continuing effort to meet stubborn problems and changing needs our urban policy proposals will a more effective partnership between the federal government state and local governments the private sector neighborhood groups and concerned citizens sufficiently flexible to meet the diverse needs of our urban areas and to respond to particular problems of distressed areas the fiscal needs of hardpressed urban governments as well as the economic and social needs of city residents the urban physical environment and strengthen urban communities federal assistance to stimulate investments by the private sector and to encourage innovative actions by the state and local governments agriculture and rural development decent farm income and a strong family farm system are vital to our national economic stability and strength for too long farm prices for many commodities have been severely depressed working with the congress in the past year we have adopted new programs and policies designed to strengthen farm income and to ensure abundant reasonably priced food for consumers partially as a result of these policies and programs farm prices are now improving nevertheless we can not be satisfied with the economic condition of many american farmers today we will continue to monitor our agricultural economy and to work with congressional and farm leaders to make certain that federal programs and policies are carried out effectively food and agriculture act in the past year we have worked with the congress to enact a new comprehensive food and agriculture act which will protect producers and consumers we have also exercised authority for wheat and feed grains which will protect farm income this year we expect to pay farmers billion for all price support programs the new farm bill which became effective october 1 1977 achieves changes in our agricultural policies including governmental intervention in markets and in the decisions farmers make support loans for major commodities that permit us to remain competitive in world markets grain reserve designed to remove excess products from the market and hold them until supplies are short support levels based on grain reserve last year we initiated a plan to place million metric tons of food and feed grains in reserve establishing this reserve will add further strength and stability to the market and provide a hedge against export control on grain most of this grain will be owned and controlled by farmers to strengthen farmer control of the grain and to help keep the grain out of government ownership terms of the farmer storage facility loan program were liberalized in 1978 the administration will propose an international emergency grain reserve of up to 6 million metric tons to help us meet our food aid commitments abroad agricultural disaster and drought aid because of the record droughts in 1977 i worked with congress to pass an 844 million emergency drought assistance program this year we will ask congress to eliminate the many inconsistencies and inequities in existing disaster aid programs and we will continue to give high priority to addressing the effects of the drought which has begun to abate we are taking other steps to improve life in rural america i recently signed a law to encourage better delivery of health services in rural communities we will continue to expand the assignment of the national health service corps doctors dentists and other health professionals to underserved rural areas we will shortly be announcing methods to improve the effectiveness of rural housing programs with greater emphasis on home ownership for rural americans agricultural exports i want to increase our agricultural exports to do so we need competitive prices high quality products and reserve supplies to meet all contingencies we must remove unnecessary barriers to exports and we must have an affirmative export policy in 1977 the administration more than doubled to billion the export credit program increased soviet grain purchase authorization to 15 millions tons developed a risk assurance program and expanded efforts to develop export markets around the world this year we will continue these efforts especially to reduce barriers to agricultural trade sugar to stabilize world sugar prices and to protect domestic we negotiated an international sugar agreement this year with the major sugar producing countries we will seek congressional ratification of the agreement early in 1978 the sugar program required by the 1977 food and agricultural act will protect the domestic sugar industry in the meantime rural development and credit policy in fiscal year 1977 the farmers home administration provided nearly 7 billion in loans in four areas farming housing community facilities and business and industrial development we expect to provide at least 1 billion more in the current fiscal year small business this administration took several steps in 1977 to strengthen small business the small business administration expanded its financial and management assistance to these firms and developed an advocacy program to represent small business interests before all federal departments and agencies in 1978 we will continue efforts to support small business through tax cuts and special tax incentives reduced regulations and other programmatic reforms and expanded sba loan authority meeting our nation human needs this administration constant concern has been with meeting the human needs of all americans over the past year we have moved on a number of fronts to make certain our citizens will be well housed better educated and properly cared for when they are in need this year we will pursue our current initiatives in these areas and launch new ones health this past year we were very active in the effort to improve the health of our citizens and to restrain skyrocketing health care costs through of a mental health commission to help develop a national mental health program the commission will issue its final report later this year and i expect to carefully consider the commission findings campaign to immunize the more than 20 million children not yet protected against communicable childhood diseases of part of hew to allow more efficient delivery of services the cost savings from the reorganizations will be realized more fully this year legislation to attack fraud and abuse in programs legislation to make reimbursement available to physician extenders in rural clinics the beneficial effects of that bill will be felt in our nation rural areas for the first time this year in 1978 the administration will continue these and other efforts to bring us better and less costly health care hospital cost containment one of my main legislative goals for this year is the hospital cost containment bill that bill which would save hospital users more than 7 billion in the first two years after enactment is our principal weapon in the effort to decrease health care costs which now double every five years national health insurance i will submit to congress later this year a national health insurance proposal while congress will not have the time to complete action on this proposal in 1978 it is important to begin the national debate on the many complex issues involved in national health insurance national health insurance will not solve all our health problems a sensible national health policy also requires more effective delivery of preventive services better nutrition vigorous abatement of environmental and occupational threats to health and efforts to change individual lifestyles that endanger health but national health insurance is a crucial step it will protect our people from ruinous medical bills and provide each citizen with better access to sound and balanced health insurance coverage medicaid improvements for children last year i proposed the child health assessment program to improve the early and preventive screening diagnosis and treatment program for children under medicaid the administration will press for enactment of this measure and will urge its expansion to make an additional million children eligible teenage pregnancy proposal i will propose legislation to establish networks of community based services to prevent unwanted adolescent pregnancies we need and will urge expansion of existing family planning services to reach an additional teenagers drug abuse drug abuse threatens the health and safety of our children here and abroad we will continue the efforts begun last year to make our drug abuse prevention and control programs more effective and efficient world health this year i will present a strategy for working directly with other nations and through international organizations to raise the standards of health and nutrition around the world education last year the congress adopted with our cooperation a 15 increase in education largest increase since enactment of the elementary and secondary education act this year we will continue to demonstrate our commitment to improving the nation education programs hew education budget expenditures will be increased by 14 with the most significant increases coming in education of the disadvantaged assistance to state programs for education of the handicapped and college student financial aid the administration will also work with the congress for the creation of a separate department of education and for legislation to replace and reform expiring federal education acts these legislative proposals will concentrate on basic literacy that students are prepared for jobs education and lifelong learning and the partnership between federal state and local governments to augment existing programs i will propose legislation to help low and families meet rising college tuition costs and will also support a significant expansion of student aid programs income assistance over the past year we have made many improvements in the programs that provide income assistance to the needy my administration will continue to assign great importance to this area in 1978 welfare reform i proposed last year a reform of the nation welfare system through the better jobs and income act this act would fundamentally reform current programs to assist the poor by the aid to families with dependent children supplemental security income and food stamps programs into a single consolidated cash assistance program that provides a basic nationally uniform federal benefit efforts to find jobs for the poor in the private sector and creating up to million public service jobs for heads of families who can not be placed in unsubsidized employment and work incentives by expanding the earned income tax credit we will work actively with the congress in the coming year to pass the better jobs and income act and we will provide in this year budget for pilot employment programs so we will be ready to implement the welfare reform program family and children my administration will continue its strong commitment to strengthening the american family and to expanding programs for children the administration will propose this year that the school breakfast program be made mandatory in schools with high concentrations of needy children further we will propose a major expansion in special supplemental food programs for women infants and children among other major actions in 1978 will be a white house conference on families for enactment of our proposed reforms in foster care programs including new financial assistance to aid in the adoption of children than doubling the budget outlays for child welfare services with an emphasis on services that help keep families together 200 million in special funding for day care under title xx of the social security act we will also depend upon the revitalized community services administration to develop new approaches to assist the poor the elderly last year saw the enactment of social security financing legislation that will assure the system financial integrity into the next century this year the administration will continue to work for strengthened legislation against unwarranted age discrimination in the federal and private sector we will propose legislation to extend and strengthen the older americans act and we will seek a 13 increase in funding for programs providing daily meals to the elderly raising the total of daily meals served to in addition the administration will work to assure that the contributions of older americans are sought in our efforts to meet national needs housing last year we made progress toward our national goal of a decent home in a suitable environment for every american family 1977 was a good year for housing generally with total new starts exceeding two million and we have renewed the federal government commitment to housing for the needy early last year the administration proposed major new initiatives to meet the housing needs of and which are central to our urban development strategy we had about starts under section 8 and public housing subsidized programs in 1977 we look forward to another 30 percent increase in subsidized housing starts in these programs for 1978 and starts in the assisted housing rehabilitation loan programs we will reassess our national housing needs and goals and our current housing and credit policies designed to meet those needs in 1978 the administration will strengthen its commitment to meet the housing needs of all communities with a variety of expanded programs and new initiatives housing assistance to an additional families and help to enable an additional families to own their own homes the total number of families receiving housing assistance will increase from million in 1977 to million in 1979 funds for the rehabilitation loan program under section 312 with an expansion of existing programs for substantial renovations and the creation of a new moderate rehabilitation program under section 8 major new operating subsidy program for 1979 this new program coupled with improved management controls and the monitoring of troubled projects is intended to reduce the inventory of defaulted projects and aid in restoring distressed urban areas the department of housing and urban development has made substantial progress in 1977 in reducing the stock of defaulted projects this new program will give the department additional tools outlays for this program are estimated to total 52 million in 1979 federal financing mechanism for assisted housing projects through use of the gnma tandem program targeted gnma tandem program which will provide subsidies designed to bring families back to the cities of rural housing programs to residents including a special program to help very poor families own their own homes high levels of production of housing for the elderly and handicapped transportation this year we will build on the efforts we made last year to strengthen the nation transportation system by decreasing consumer costs pursuing increased energy efficiency and improving safety of a new bilateral air services agreement of new international air routes from a number of american cities passive restraint systems on all new automobiles by 1984 new fuel efficiency standards for model automobiles work on the northeast corridor railroad improvement program an airline deregulation bill we will also continue our policy of increasing competition and reducing airfares in international flights and pursue additional bilateral agreements consumers have already benefited from reduced international fares and improved service highway and transit programs we will soon propose a comprehensive highway and transit program which will provide more than 45 billion in total authorizations in the period the program will give states and localities more flexibility in planning and programming their highway and transit funding by reducing the number of narrow categorical accounts and by using consolidated accounts for a wider range of potential transportation projects in addition we will make funding of transportation programs more uniform and give localities more control over highway and mass transit funds in large urban areas highway safety the administration will propose legislation to strengthen ore efforts for highway safety and to reduce restrictions on the states use of federal highway safety grant funds that legislation will earmark funds for the department of transportation to support important highway safety projects such as the 55 mile per hour speed limit program inland waterway user fees users of federal inland waterways should pay fees which will pay a substantial part of the cost of constructing operating and maintaining those waterways my administration will continue to work closely with congress toward passage of a bill that will for the first time establish inland waterway user fees aircraft noise abatement my administration will again seek passage of legislation to control aircraft noise automobile insurance we continue to support legislation to establish federal minimum standards for automobile insurance veterans in 1977 we took a number of steps to make certain that the country continues to meet the special needs of our millions of veterans legislation was passed to increase compensation benefits for service connected disabilities benefits under the bill and veterans pension benefits millions of veterans will feel the effects of these increases this year in 1978 we will further improve our veterans programs by a review of the problems of vietnam veterans and the means by which current programs can be made more effective in meeting their needs new programs to deal with problems of alcohol drug abuse and psychological readjustment increased benefits for disabilities and improvements in the veterans pension program special employment programs for veterans arts and humanities americans are increasingly aware that the arts and humanities preserve and transmit our heritage enrich our lives and contribute significantly to the social and economic of our nation this administration is committed to fostering the highest standards of creativity and scholarship in an open partnership between public and private we believe that the products of this commitment must be available to the many americans who wish to share in them this year substantial increases in the budgets for the arts and humanities endowments demonstrate my strong belief in the value of these programs making the government more efficient and more responsive government employees civil service reform the civil service system is too often a bureaucratic maze which stifles the initiative of our dedicated government employees while inadequately protecting their rights our million civil servants are governed by outdated rules and institutions that keep them from being as efficient as they would like to be no one is more frustrated by this system than public servants therefore one of my major priorities in 1978 will be to ensure passage of the first comprehensive reform of the system since its creation nearly a century developed with the direct involvement of civil servants early this year congress will receive legislation and a reorganization plan to the institutions that run the civil service safeguards against abuses of official power greater incentives for managers to improve the government efficiency and responsiveness the system red tape and delays the procedures for dealing with employee grievances and disciplinary actions equal employment opportunities more effective last year the administration acted to protect federal employees from the loss of a job due to reorganization such protection will be maintained hatch act reform i will continue to support reform of the hatch act which would restore the right of most civil service employees to participate in the political process and employment to help obtain federal jobs for the elderly the handicapped women and others with family responsibilities all federal agencies will carry forward renewed efforts to increase and employment opportunities reorganization management and regulatory reform the government reorganization project will keep working to make the government more responsive and efficient last year we combined parts of 11 agencies into one department of energy streamlined the executive office of the president and reduced the white house staff and proposed the abolition of nearly 500 advisory committees and small agencies in addition to the upcoming civil service and education reform efforts we will soon submit proposals restructure our equal employment programs to provide better protection for the rights of minorities and women and to ease the burden of compliance on state and local government as well as business improve the administration of justice and reorganize our disaster assistance programs additional studies are under way in many other areas and several of these will result in reorganization proposals later this year efforts to improve federal cash management continue we are also vigorously pursuing the effort begun last year to reduce the burden of outdated ineffective and nitpicking regulations for example the department of health education and welfare eliminated 5 of their regulations the federal trade commission rescinded 111 outdated sets of rules on trade practices and both the civil aeronautics board and the interstate commerce commission have moved to allow more competition which has led to lower prices in 1978 we will continue these efforts worker health and safety the occupational health and safety administration has already slashed its paperwork requirements by 50 and eliminated unnecessary regulations while improving its capacity to protect workers this spring the task force on worker safety will make further recommendations to increase protection for workers and minimize employer cost airline regulatory reform last year i signed legislation deregulating all cargo air transportation this year i will continue to work for passage of the airline regulatory reform bill for passengers that bill will allow air carriers to compete through lower fares new services and new markets without excessive government interference or disruption of service to small communities trucking regulatory reform forty years of tight government controls have not done enough to bring us competitive prices good service and efficient use of fuel we will consider measures to bring more competition into the motor carrier area drugs we will propose legislation to reform regulation of the drug industry which will protect the consumer and make regulations fairer and less burdensome regulatory process early in 1978 i will issue an executive order to improve the regulatory process this order will require officials responsible for regulations to sign them assure officials are fully involved in the process require that regulations be written in plain english make it easier for the public to participate in the process increase coordination between agencies with overlapping responsibilities require a closer look at the cost of regulations before they are issued and require sunset reviews of existing regulations i have also set up an interagency committee to help regulatory agencies review the economic effects of major regulations so that we can be sure that the costs of each proposed regulation have been fully considered in this way we will be able to identify the least costly means of achieving our regulatory goals paperwork reduction in 1977 my administration decreased by 12 the paperwork burden that the government imposes on the people this was done by eliminating consolidating simplifying and decreasing the frequency of reports that savings is the equivalent of workers filling out federal forms for a full year all departments and agencies are currently setting goals for further substantial reductions in 1978 all reporting requirements associated with programs will be subject to sunset review and ended unless they are found necessary in addition we are reviewing the recommendations of the commission on federal paperwork labor law reform last year we proposed legislation to reform our nation labor laws in order to streamline the conduct of elections for employee representation and strengthen the enforcement powers of the national labor relations board we will work closely with congress to ensure early passage of this bill which is one of my highest legislative goals this year election reform last year i supported proposals to make our elections fairer and more honest these included public financing of congressional campaigns amendments to the federal election campaign act and other election reforms the administration will continue to support congressional action on these measures consumer reform we have taken many actions to benefit consumers by reducing the costs and improving the quality and safety of products but one consumer initiative merits separate creation of the office of consumer representation we supported legislation last year to create such an office so that the interests of consumers could be represented in one government agency the office would not require additional government employees or expenditures since it would merely consolidate the consumer offices that already exist throughout the government i am strongly committed to this legislation and regard its enactment as one of the year primary legislative priorities public broadcasting reform i proposed legislation last year to strengthen the public broadcasting service by providing increased federal support insulation from political pressure better coordination among the national organizations that run public broadcasting and more opportunity for citizens to participate at the local level my administration will work with congress this year to pass these reforms openness and integrity one of our primary goals is to make certain that the government ethical standards are high and that they are fully observed and we must ensure that our government is open and responsive to the american people last year i took steps in that direction by requiring that the senior officials of my administration publicly disclose their income and assets and pledge not to do business with their agencies for two years after leaving government service to increase the government openness we took steps to make certain that the as well as the letter of the freedom of information act was observed and we tried to bring the presidency to the people with citizen forums and discussion panels throughout the country this year we will continue these efforts concentrating our primary attention on these areas lobby reform the administration will press for legislation requiring registration of lobbyists and thorough public disclosure of their lobbying activities this legislation will help reestablish confidence and trust in government ethics i applaud the strong ethical codes adopted last year by the house and senate i believe those codes and the standards established for my administration officials should be made law so that they will clearly apply to public officials in the future i urge congress to pass the public officials integrity act this year classification we are completing a study of classification systems for government documents and i will shortly issue an executive order designed to eliminate improper and unnecessary classification and to ensure that documents are declassified more rapidly justice civil rights and equal opportunity all americans have fundamental civil rights requiring government and all must be afforded equal opportunities to participate as full members in our society in 1977 this principle guided my administration in numerous areas and i plan to make certain that this year our efforts on behalf of civil rights and equal opportunities continue unabated our nation concern for human rights must be heard as clearly at home as abroad educational opportunities in 1977 my administration vigorously attacked educational discrimination on the elementary secondary and higher education levels a major suit was pursued to ensure at the university level at the same time we recognized and reaffirmed the importance of affirmative action programs to ensure equal opportunities at educational institutions through our brief in the bakke case our efforts to eliminate discrimination and promote affirmative action programs relying on flexible goals rather than on quotas will continue in full force handicapped hew issued regulations and guidelines to implement legislation guaranteeing equal access to programs receiving financial assistance from hew this year the other cabinet departments will issue similar regulations so that the rights of handicapped americans will begin to be fully observed we are providing a 50 million loan fund to states and institutions to enable them to comply with these regulations and to eliminate barriers which prevent access by our handicapped citizens to federally assisted programs and activities we are proposing a major increase in funding under the education of all handicapped children act equal opportunity this past year the administration reaffirmed executive order 11375 which prohibits discrimination on the basis of sex in federal employment in addition i voluntarily placed the executive office of the president under title vii of the civil rights act this year as part of our effort to eliminate sex discrimination in unemployment and education i will continue to urge the ratification of the equal rights amendment to the constitution this past year the equal employment opportunity commission was reorganized to increase its efficiency as a result the commission made substantial progress on reducing its backlog of complaints with the more than 40 increase in funding that will be proposed in the 1979 budget the eeoc will be able to further reduce its backlog early this year i will propose to congress a reorganization plan concerning equal opportunity enforcement which will strengthen the eeoc boycott i strongly supported and signed legislation to prohibit american participation in secondary economic boycotts by foreign countries that law will be strictly enforced by my administration this year through the regulations just issued by the department of commerce minority business last year we started a number of programs to make more opportunities available for businesses that effort will be continued and strengthened this year are half way toward our two year goal of 2 billion in federal purchases of services and goods from firms we will reach that goal by the end of the year will raise the goal for federal deposits in banks above the 1977 level of 100 billion will continue to enforce the 400 million minority business provision in the local public works act and may exceed that target will continue to implement the minority business policy established for contracts let in the east corridor railroad improvement program undocumented aliens last year i proposed legislation to impose sanctions on employers who hire undocumented aliens and to change the legal status of the many undocumented aliens now residing in this country that legislation would afford undocumented aliens residing here continuously since before 1970 the opportunity to apply for permanent resident status it would create a new temporary resident status for those undocumented aliens who resided here continuously from 1970 to january 1 1977 i want to work with congress this year toward passage of an undocumented aliens bill for this social and economic problem can no longer be ignored native americans the administration has acted consistently to uphold its trusteeship responsibility to native americans we also have elevated the post of commissioner of indian affairs to the level of assistant secretary of interior in 1978 the administration will review federal native american policy and will step up efforts to help indian tribes assess and manage their natural resources legal and judicial reform last year my administration began a number of major efforts to improve our nation legal and judicial system and we intend to pursue those and related efforts fully this year criminal code reform we have worked closely with members of congress to develop a proposed revision of the nation criminal code that revision will codify in one part of the code all federal crime laws and will reform many outdated and inconsistent criminal laws my administration will work closely with congress this year to seek passage of the first complete codification of the nation criminal laws judicial reform the federal judicial system has suffered for many years from an inadequate number of judges and we will continue to work with congress on an omnibus judgeship bill to correct this problem we will also continue our efforts to use our judges more effectively through legislation which we have proposed to expand significantly the authority of magistrates to increase the use of arbitration and to tighten federal jurisdiction we will work this year to complete congressional action on these bills wiretap reform last year we proposed legislation reforming our approach to electronic surveillance for foreign intelligence purposes and affording greater protection to our citizens essentially that legislation would require the government to obtain a court order before beginning any foreign intelligence wiretaps in this country my administration supports early passage of this much needed legislation enforcement and competition our nation laws must be vigorously enforced therefore i recently established a presidential commission to review federal enforcement and to make its recommendations this year last year we initiated a new program administered by the department of justice to provide grant funds to state attorneys general in order to strengthen enforcement at the state level we expect to see the results of this program this year by reducing government regulation we can increase competition and thereby lower consumer costs this year we will continue our deregulatory efforts in the legislative and administrative areas in order to reduce practices and abuses crime reduction and criminal justice this past year the reorganization project and the justice department have been developing proposals to reorganize and to improve our nation criminal justice system in order to strengthen enforcement and ensure equal justice this year i will be sending a message to congress on criminal justice and crime reduction my message will include proposals to the federal law enforcement assistance administration our criminal research efforts better law enforcement methods against organized crime white collar crime drug abuse and public corruption and minimum standards for federal correctional institutions fbi and intelligence agencies charters i plan to issue a comprehensive executive order to govern the intelligence activities of the fbi cia nsa and the defense department that executive order will be the basis for the administration recommendations on legislative charters governing the activities of the fbi and various intelligence agencies privacy the privacy protection study committee recently proposed an extensive list of new legislative and regulatory safeguards my administration is analyzing these recent proposals and will develop this year a program to ensure that personal privacy is adequately protected district of columbia we proposed last year a series of reforms including full voting representation in congress designed to give the residents of the district significantly greater control over their local affairs my administration will continue to work for the passage of those reforms this year developing and protecting our natural resources energy national energy policy in april 1977 i proposed to the nation a comprehensive national energy policy that policy is based on three principles which will continue to guide our progress in 1978 must learn to use energy more efficiently and more carefully through conservation measures including retrofitting our buildings factories and homes must shift from oil and natural gas which are becoming more scarce to coal and renewable sources of energy which we have in abundance must provide fair prices to producers of energy so as to encourage development of new supplies without permitting windfall profits the debate on this comprehensive policy has been long and arduous a number of difficult contentious issues remain to be settled i am confident however that the congress recognizes the seriousness of our energy problem and will act expeditiously on this program early this year securing passage of an acceptable energy which is fair to consumers provides needed energy savings and is prudent from a fiscal and budgetary continue as our highest and most urgent national priority in 1978 energy statutes and actions we have already begun to lay a strong foundation for implementation of a national energy policy in 1977 we took steps to put in place important policies and structural reforms needed to meet our energy goals of a new department of energy which combines for the first time major governmental functions of energy research regulation pricing policy information collection and dissemination and overall policy development without a strong organization we would not hope to implement a comprehensive national policy has approved our proposed route for a pipeline to bring natural gas from the north slope of alaska to the lower 48 states of the emergency natural gas act to cope with the hardships of last winter freeze and assure that high priority gas users were not cut off during supply emergencies of more than 4 billion to store the first 500 million barrels of oil in a strategic petroleum reserve we have already begun to fill that reserve and we remain committed to a 1 billion barrel strategic reserve by 1985 outer continental shelf legislation legislation to improve the management of the outer continental shelf for oil and gas development is a major item of unfinished business pending before congress prompt passage is necessary so that we can have the benefit of the new law as we move to open more offshore areas to development and production this bill mandates reforms in the leasing program to provide for the necessary development of offshore oil and gas while enhancing competition among oil companies assuring that the public receives a fair return for the sale of the public oil and gas resources and protecting our marine and coastal resources nuclear energy the united states has also advanced a policy to prevent the proliferation of nuclear weapons around the world an international nuclear fuel cycle evaluation has been established with wide international participation to examine alternatives to existing technologies in addition legislation was proposed last year to establish better controls on export of nuclear fuels and technologies we will work with congress to secure passage of that legislation early in 1978 our commitment to preventing the spread of nuclear weapons has led us to reorient our own domestic nuclear policies i have deferred indefinitely the commercial reprocessing of spent nuclear fuel and plutonium recycling the clinch river plant itself would waste more than 2 billion while teaching us little that we do not already know or can not learn from our existing nuclear research and development program i have recommended that the clinch river breeder project be stopped because it represents a premature and unwise commitment to commercialization of technology that we do not now need however we intend to continue to develop the nuclear energy the nation needs we will continue to move forward with a major research program on breeder technology we will begin to implement our program for government management of spent fuel from nuclear reactors in 1978 my administration will work towards a policy for safe permanent disposal of nuclear wastes in 1978 and beyond we will carry on a vigorous nuclear research and development program designed to give us safe technologies that will reduce the danger of nuclear proliferation and will be environmentally responsible we will also seek to improve the current system of licensing nuclear power reactors in order to cut bureaucratic delays while firmly maintaining and strengthening health safety and environmental requirements i will propose nuclear licensing legislation to the congress this year environment one of my deepest personal commitments is to a clean healthy environment for all of our citizens last may i outlined this administration environmental priorities and policies in a comprehensive environmental message working closely with the congress we have made good progress on many of the measures contained in that message it will continue to guide our administrative and legislative actions in 1978 overall we will our environmental outlays by more than 10 and provide the new staff resources necessary to ensure that the nation environmental laws are obeyed the best way of enforcing the landmark environmental statutes enacted in 1977 taking considerations of science and public policy into account several important initiatives including a national heritage program and designation of national interest lands in alaska to manage our precious natural resources better and to preserve our heritage environmental statutes in 1977 we worked closely with congress to enact three of the most significant environmental statutes in recent years surface mining control and reclamation act establishes a joint program to make sure we use economically and environmentally sound practices it also sets up a fund to reclaim lands which have been ravaged by uncontrolled careless mining and provides clear stable policy direction for operators clean air act amendments establish strict but achievable standards for auto emissions and ensure continued progress in reducing pollution from stationary air pollution sources clean water act authorizes many of our most important water cleanup programs and will protect our nation wetlands without unnecessary federal requirements the act also reforms the sewage treatment construction grant program and gives strong emphasis to the control of toxic chemicals in our environment we will provide the leadership and the funding necessary to carry out these new laws water policy in 1977 an effort was begun to ensure that federal programs and policies provide sound and fair management of our limited and valuable water resources we began a complete review of federal water policy which will be completed this year after close consultation with the congress the states and the public we will propose measures needed to carry out the recommendations of that study we will also continue with the strong dam safety inspection program which was initiated late last year to make sure our dams public or private are safe alaska lands last year i sent congress a proposal for use of federal lands in alaska this proposal will protect 92 million acres for the public will create or expand 13 national parks and reserves 13 national wildlife refuges and will confer wild and scenic river status on 33 waterways i hope congress will adopt these measures which are needed this year to preserve the unique natural treasures of alaska and at the same time permit the orderly development of alaskan resources redwood national park redwood national park contains some of the nation largest and oldest trees last year to protect these trees from destruction by commercial logging at the edges of the park legislation was proposed to expand its boundaries we will press for congressional action on this bill in 1978 national heritage program we will shortly be proposing a program to preserve unique elements of our natural and cultural heritage this program modeled after successful ones in several states will be administered by the department of the interior although many of the necessary steps can be taken administratively we will seek some new legislative authority in 1978 federal compliance with environmental laws my administration is committed to the principle that the federal government must set a good example of compliance with those environmental laws and regulations which have been established for the private sector so far unfortunately the federal record has been found wanting my 1979 budget includes money to bring federal facilities into compliance with existing environmental laws and regulations federal reclamation in 1977 we began a thorough review of the 1902 reclamation act after the study has been completed and reviewed this year i will propose to congress any changes needed to modernize the law mining law reform last year the administration proposed legislation to replace the archaic 1872 mining law with a modern leasing system for mineral resources the 1872 system has resulted in withdrawal of large areas of land from mineral exploration as the only tool for environmental protection the administration proposal would establish a balanced system where the public interests in mineral development environmental protection and revenue to the treasury will all be accomplished special provisions would minimize burdens on small operators and provide incentives for exploration oil spills last year i proposed to congress legislation which would establish strict liability standards for oil tanker spills and would improve regulations aimed at preventing future oil spills that legislation is still needed science and technology the health of american science and technology and the creation of new knowledge is important to our economic to our national security to our ability to help solve pressing national problems in such areas as energy environment health natural resources i am recommending a program of real growth of scientific research and other steps that will strengthen the nation research centers and encourage a new surge of technological innovation by american industry the budget increase of 11 for basic research will lead to improved opportunities for young scientists and engineers and upgraded scientific equipment in the nation research centers i am determined to maintain our nation leadership role in science and technology we will continue america progress in the field of space exploration with continued development of the space shuttle system and procurement of four shuttle orbiters for operations from both east and west coasts development of a spacecraft to study for the first time the polar regions of the sun and increased outlays for demonstrations of the practical applications of systems and development of space technology foreign affairs a year ago i set five goals for united states foreign policy in the late 1970 and early 1980 to reassert america moral leadership to strengthen our traditional ties with friends and allies to work toward a more just international system to promote regional reconciliation and to preserve peace through preparedness and arms control these goals continue to underlie my agenda for 1978 moral leadership during the past year we have placed american foreign policy on a new course consistent with the values and highest ideals of the american people we are trying to limit the worldwide sale of arms we are trying to prevent nuclear the ability to make spreading to more countries we are building new relationship with the developing countries and we are promoting human rights throughout the world human rights virtually everywhere human rights have become an important countries where they are systematically violated there has been real progress and for that the united states can take some credit we have taken the lead among western nations at the belgrade review conference on security and cooperation in europe working closely with our allies and with neutral and nations our by ambassador arthur conducted a thorough review of implementation of the helsinki final act in all its aspects we have made clear the united states is committed to the full implementation of the final act in this and other areas we will seek a further review conference in two years meanwhile we will press for better implementation of the helsinki final act we must not ignore the enormous dangers posed by the unrestrained spread of nuclear weapons technology we recognize the benefits of commercial nuclear power but we also must acknowledge the risks we believe that all countries can enjoy the benefits while the risks are minimized by developing safer technologies and creating new institutions to manage and safeguard all phases of the nuclear fuel cycle meanwhile we have decided to postpone a premature commitment to technologies we can not yet safely manage on a commercial scale and we are seeking to persuade others that there are sound economic and energy reasons for them to do likewise arms sales the world is threatened by the spiraling increase in trade of conventional arms not only do these arms increase the likelihood of conflict they also divert resources from other human needs it will not be easy to slow this spiral we will begin to cut back on our own sales in recognition of the fact that as the world principal seller we have a duty to take the first step but we know that our efforts can only succeed if other major arms suppliers and recipients cooperate ties with friends and allies the energy crisis has underscored the reality of interdependence among nations and the need for a stable international financial and trading system our own actions reflect the belief that consultations with traditional friends and dialogue with developing nations are the only way that the united states can provide the economic and political leadership which the world expects of us working with the allies during the past year the united states restored our traditional friends and allies to the center of our foreign policy within days after his inauguration the vice president visited brussels rome bonn paris reykjavik and tokyo i met frequently in washington with european and japanese leaders i participated in the economic summit in london the 1977 nato summit and a summit with leaders of britain germany and france at the beginning of 1978 i visited france and while in brussels made the first visit by an american president to the headquarters of the european community we have also consulted with our european allies on such diverse subjects as salt mbfr the middle east africa human rights the belgrade conference energy nonproliferation the global economy and relations we will intensify these efforts this year expanding the list to include close consultations with the allies on major arms control issues on may we will host a nato summit in washington and we are also planning another economic summit this year we have shown in our dealings with japan that close allies can find solutions to shared problems early in the year we were concerned about nuclear reprocessing in japan but through flexibility and goodwill on both sides a suitable accommodation was reached on the building of a nuclear reprocessing plant there most recently we reached agreement with the japanese on ways to deal with their large current account surplus our trade and economic talks are another example of constructive action international economic cooperation we are working to improve and extend the international economic system to strengthen international economic institutions and to ensure that international economic competition takes place in an orderly fashion we will seek to improve cooperation among nations in the imf the gatt the world bank the oecd and other international organizations which have enabled us to maintain an open liberal trade and payments system the american economy remains strong our competitive position in international trade is excellent in 1977 our merchandise exports exceeded imports except for oil by a large amount our inflation rate is among the lowest in the industrial world but our balance of trade and payments incurred a large and worrisome deficit there were two main causes 1977 45 billion flowed out to pay for imported oil this wiped out what would otherwise have been a trade surplus demand here for foreign goods was much greater than the demand for american goods abroad in 1977 american gnp increased roughly twice as fast in real terms as the gnp of our main trading partners against this background the exchange rate of the dollar declined relative to the currencies of japan germany switzerland and other european countries these developments led to disorderly conditions in the exchange markets in december i made clear that the united states would intervene to counter these disorders and we have done so to assure the integrity of the dollar we must act now need a healthy and growing united states economy with adequate investment a prudent budget and declining inflation this will make us more competitive and more attractive to foreign investors need to conserve energy and develop alternative sources of supply this will reduce our dependence on imported oil and cut the outflow of dollars need to see a more vigorous world economy stronger growth particularly in countries like germany japan switzerland and the netherland can help reduce our own deficits and bring stability to international payments factors already at work will reduce our trade deficit economic activity in europe and elsewhere should rise our oil imports should level off this year the effect of new exchange rates that have already occurred will when their full effect is realized improve our trade balance by several billions of dollars while our trade and payments deficit in 1978 will be large our external position should show some improvement we must also augment our capacity to deal with possible strains and pressures by strengthening our international trade and monetary system i urge the congress to act promptly to approve united states participation in the imf supplementary financing facility the trading nations of the world are engaged in negotiations to reduce barriers and improve the international trading system by a reciprocal and balanced opening of markets freer trade will enable us all to use the world resources more efficiently and will contribute to economic growth we will also attempt to strengthen the rules that have regulated international trade during the last 30 years international competition must take place within a framework of agreed rules that are recognized as appropriate and fair the developing countries one of the most critical issues facing the united states is our economic and political relationship with developing countries our economy has become visibly dependent on the developing world for supplies and markets dialogue throughout 1975 and 1976 the united states and other developed countries worked with a group of developing nations in the conference of international economic cooperations ciec that dialogue reached agreement on some issues in june 1977 but there remain a number of unresolved questions the united states will continue to consult and negotiate with developing countries on questions like commodity price stabilization technology and a common fund for international buffer stocks we will pursue the dialogue in the months ahead confident that the developed nations and the developing nations can agree upon measures that will let all nations participate more fully in the management of the world economy africa our relations with africa involve energy human rights economic development and the dialogue the maputo and lagos conferences demonstrated that african countries can discuss difficult problems with us to mutual advantage our relations with nigeria have improved dramatically the administration fy 79 budget substantially increases development assistance to africa including continued support for the african development fund and other programs to help african governments meet their people basic human needs the growth of african regional institutions like the sahel development fund is important to african development the administration approach to latin america and the caribbean recognizes this region diversity we have placed great importance on the protection and defense of human rights on halting the proliferation of nuclear weapons capabilities on restraining conventional arms sales on contributing to the settlement of disputes and on engaging latin governments in global economic negotiations we are now seeking senate ratification of protocol i of the treaty of tlatelolco and the american convention on human rights through the caribbean group we are trying to promote regional development and we intend to help several nations develop alternative energy sources panama general torrijos and i signed the two panama canal treaties on september 9 7 1977 these treaties meet the legitimate interests of panama and the united states and guarantee our permanent right to protect and defend the canal they will contribute importantly to regional stability asia the united states has sought to underline our desire for a close relationship with the developing countries of asia through my visit to that continent and through regular contacts with the member countries of the association of southeast asian nations we welcome the cooperation with asean of the developed countries of the region such as japan and australia promoting regional reconciliation the greatest danger to world peace and stability is not war among the great powers but war among small nations during the past year the united states has helped to promote productive negotiations in two troubled regions the middle east and southern africa we have also tried to settle conflicts in the horn of africa and on cyprus and we have negotiated two panama canal treaties that will enhance our country relations with all the nations of latin america the middle east in an effort to break with the rigid approaches of the past and bring about an overall peace settlement i have looked to three basic principles normalization of political economic and cultural relations through peace treaties withdrawal of armed forces from occupied territory to recognized and secure borders and the establishment of effective security measures and a resolution of the palestinian question significant progress toward peace in the middle east was made last year we particularly applaud president sadat courageous initiative reciprocated by prime minister begin in launching direct negotiations the united states will continue this year to encourage all parties to resolve this conflict southern africa the entering administration inherited problems in rhodesia namibia and south africa the british the united states launched new rhodesian discussions last year the plan of september 1 sets forth fair and workable principles for majority rule a transition period leading to free elections a un presence a constitution with a judicially protected bill of rights and a zimbabwe development fund contact group in which the united states participates has held discussions with south africa and with the southwest africa peoples organization and other interested parties on an internationally acceptable settlement for an independent namibia under majority rule this effort has produced wide agreement including provisions for a substantial un presence united states has told the south african prime minister that unless his nation begins a progressive transformation toward full political participation for all its people our relations will suffer we supported a union nations arms embargo on south africa prohibited gray area sales and began a review of south african economic relations the horn of africa arms supplied by the soviet union now fuel both sides of a conflict in the horn of africa between somalia and ethiopia there is a danger that the soviet union and cuba will commit their own soldiers in this conflict transforming it from a local war to a confrontation with broader strategic implications we deplore the fact that disagreements in this region have the assistance of outside bloody conflict we have made clear to both sides that we will supply no arms for aggressive purposes we will not recognize forcible changes in boundaries we want to see the fighting end and the parties move from the battlefield to the negotiating table cyprus we hope that the groundwork was laid in 1977 for a permanent settlement in cyprus and we are encouraging movement in that direction preserving peace during the past year the administration has assessed the threats to our own and our allies security as well as our collective strength to combat these threats we have sought to promote responsible arms control efforts and to reduce competition in arms recognizing that a strong defense is the foundation of our security we have made certain that our defense spending will be sufficient and used to maximum effect arms control the fundamental purposes of our arms limitations efforts are to promote our own national security and to strengthen international stability thereby enhancing the prospects for peace everywhere are trying to move the strategic arms limitation talks toward more ambitious objectives we want to reduce not just contain the competition in the number of strategic weapons possessed by the united states and the soviet union and to limit qualitative improvements in weapons which merely raise the risks to all of us precisely because of our determination to obtain both of these objectives negotiations have been difficult and prolonged however i am confident that the agreement that we will present to the congress will meet them have also made solid progress toward an objective that the united states has pursued for many years a comprehensive treaty banning all nuclear explosions this treaty will be open to all nations of the world it will be a major step toward reduced reliance on these weapons and toward halting their further spread in the world the same time we are seeking arms limitations agreements with the soviet union that will contribute to security and stability in various regions of the world in europe we and our nato allies are seeking a mutual and balanced force reductions agreement that will achieve greater stability and balance at lower levels of forces in the indian ocean where neither we nor the soviet union has yet deployed military power on a large scale we are working for an agreement to prevent a major military competition the first time we have begun to negotiate with the soviet union the outlines of a treaty banning chemical warfare essential element of american security is the maintenance of stability in the western pacific where the united states plays a major role in maintaining a balance of power we are seeking to readjust our military presence in korea by reducing our ground forces on the peninsula and undertaking compensatory measures to ensure that an adequate balance of forces remain we are talking with the filipino government about the future of our military bases there are continuing the process of normalization of our relations with the people republic of china within the framework of the shanghai communiqué the last year we have sought to halt the worldwide spread of nuclear weapons capacity nearly 40 nations have joined with us in an effort to find nuclear power sources that can not be readily used for building nuclear weapons defense the defense budget that i am recommending to congress will fulfill our most pressing defense needs i am requesting increases in defense spending that more than compensate for inflation they are needed to maintain an adequate military balance in the face of continued soviet military efforts we negotiate with the soviets over strategic arms we are continuing to preserve essential equivalence in strategic nuclear strength here our technological advantage over the soviet union is most apparent we are building cruise missiles which together with upgraded will assure the capability of this element of our triad we are continuing to develop the missile system in case we need to deploy them in this budget i am requesting funds for continued increase in our trident submarine force which is our most important strategic program because submarines are so hard for any enemy to destroy our nato allies we are trying to improve the initial combat capability of nato forces we will improve the readiness of critical combat units enhance american capability to send ground and tactical air forces reinforcements and increase our permanent forces there to lay the foundation for future improvements the budget i propose requests 18 increases in the procurement of equipment for the army the united states is not taking these steps alone we are participating in a mutual effort importance of sea forces to united states national security is undisputed the navy receives the largest share of the defense budget and i am requesting funds to continue its modernization but we need to examine the appropriate size and mix of united states naval forces in the future therefore i have deferred spending for new aircraft carriers until a current defense department study is completed early this year while we maintain our naval strength we should have the capability to deploy rapidly a light but effective combat force worldwide if necessary without overseas base support to this end i am requesting funds for a vigorous airlift enhancement program in these and other ways we are seeking to develop a foreign policy which is wider in scope a foreign policy which recognizes global diversity and a foreign policy which builds a more just and stable international system jimmy carter the white house january 19 1978
tonight state union address concentrates year highest strong energy bill coordinated economic program job creation tax reduction tax reform measures making government effective efficient maintaining peace strong national defense ratifying panama canal treaties completed salt ii treaty important congress nation also understand important initiatives goals 1978 therefore sending congress separate detailed state union message describes administration priorities areas fully covered address domestic affairs number serious domestic problems faced nation took office one year ago economy yet fully recovered recession country sound energy policy federal government operating inefficiently ineffectively many areas concerns openness integrity government remained aftermath watergate many pressing social problems addressed 1977 administration solve problems congress joined us tackling many issues together made progress year passed believe confident people trust institutions country move prepared address problems boldness confidence home abroad reasserted concern problems people home reaffirmed position moral leadership world year domestic goals continue reflect concerns guided actions 1977 restoring economic prosperity meeting nation human needs making government efficient responsive developing protecting natural resources restoring economic prosperity devoting substantial part state union address need comprehensive economic program devote bulk economic report congress delivered tomorrow complete description administration economic goals objectives message therefore repeat statements want set forth briefly key elements proposals 23 billion income tax cut 1979 17 billion going individuals families 6 billion going businesses tax reform program designed make tax laws fairer simpler program designed reduce annual increases wages prices cooperation labor business federal government setting example reductions 2 billion excise payroll taxes also make contribution reducing inflation extension funding public service ceta jobs 700 million increase spending youth employment efforts major new 400 million private sector jobs initiative designed primarily encourage businesses hire unemployed minorities youth plan work closely congress secure prompt action economic proposals adoption help achieve kind economic prosperity nation us want along sound energy bill enactment economic proposals highest domestic priority 1978 energy higher priority prompt enactment comprehensive energy legislation along lines submitted congress last spring huge oil price increases contributed inflation 1974 worst recession 40 years price hikes also principal foreign trade deficit contributed weakness dollar abroad unless act energy problems rapidly get worse failure act fuel inflation erode value dollar render us vulnerable disruptions oil supply limit economic progress years come confident congress respond nation clear need enacting responsible balanced energy legislation early year employment last year made considerable progress efforts reduce unemployment unemployment rate decreased year million new jobs created unemployment fell million workers actions took part 21 billion economic stimulus package substantially helped us achieve favorable results 1978 administration continue efforts reduce unemployment still increase employment opportunities americans part budget propose funds increase youth programs 260 1976 level providing billion outlays employment training young workers 400 million private sector employment program focused youth disadvantaged workers aimed mobilizing private industry work government finding jobs implemented business councils established throughout country ceta jobs 1979 tying future years national unemployment rates beginning demonstration program jobs component better jobs income program legislation administration seek passage full employment balanced growth act act help administration congress planning efforts reduce unemployment create jobs maintaining reasonable price stability enactment would serve living memorial late senator hubert humphrey private sector jobs administration plans major 400 million effort involve business labor training hiring unemployed program closely tie federal employment system private sector use business councils confident private sector respond positively call help nation solve one serious problems employment youth minorities inflation although inflation lower recent past still must keep steps administration take include business investment contained tax proposals increase productive investment thereby help us hold prices costs excise unemployment taxes proposed new budget reductions needlessly complex federal regulations established interagency committee review effects regulation economy continue efforts regulatory reform airline industry elsewhere special effort hold soaring costs health care enactment hospital cost containment act government solve problem alone especially business labor consumers accel ted inflation fact life adjusted behavior accordingly therefore asked business labor undertake voluntarily new program reduce inflation ask industry aim smaller price wage increases 1978 averaged last two years major employer federal government take lead effort voluntary cooperation one reduce inflation without unacceptable government interference coercion urban assistance community development administration congress took major steps last year meet needs cities increased funding community development block grants billion three years provided alternative formula allocating funds responsive needs distressed urban areas next year recommend increase 150 million 1978 level community development block grant program enacted new program urban development action grants annual level 400 million extended expanded fiscal assistance arfa proposing arfa program expires september 30 1978 extended evaluating possible revisions programs funding make recommendations congress within two months administration also studying closely possible need extended federal lending new york city current legislation expires june 30 1978 committed along state city preserving city solvency extended lending necessary purpose propose however interested parties must contribute permanent solution spring submit congress message outlining administration urban policy based work urban regional policy group chaired secretary housing urban development designed make existing federal programs effective involve new initiatives resources address urban needs problems cities structural nature corrected efforts administration committed continuing effort meet stubborn problems changing needs urban policy proposals effective partnership federal government state local governments private sector neighborhood groups concerned citizens sufficiently flexible meet diverse needs urban areas respond particular problems distressed areas fiscal needs hardpressed urban governments well economic social needs city residents urban physical environment strengthen urban communities federal assistance stimulate investments private sector encourage innovative actions state local governments agriculture rural development decent farm income strong family farm system vital national economic stability strength long farm prices many commodities severely depressed working congress past year adopted new programs policies designed strengthen farm income ensure abundant reasonably priced food consumers partially result policies programs farm prices improving nevertheless satisfied economic condition many american farmers today continue monitor agricultural economy work congressional farm leaders make certain federal programs policies carried effectively food agriculture act past year worked congress enact new comprehensive food agriculture act protect producers consumers also exercised authority wheat feed grains protect farm income year expect pay farmers billion price support programs new farm bill became effective october 1 1977 achieves changes agricultural policies including governmental intervention markets decisions farmers make support loans major commodities permit us remain competitive world markets grain reserve designed remove excess products market hold supplies short support levels based grain reserve last year initiated plan place million metric tons food feed grains reserve establishing reserve add strength stability market provide hedge export control grain grain owned controlled farmers strengthen farmer control grain help keep grain government ownership terms farmer storage facility loan program liberalized 1978 administration propose international emergency grain reserve 6 million metric tons help us meet food aid commitments abroad agricultural disaster drought aid record droughts 1977 worked congress pass 844 million emergency drought assistance program year ask congress eliminate many inconsistencies inequities existing disaster aid programs continue give high priority addressing effects drought begun abate taking steps improve life rural america recently signed law encourage better delivery health services rural communities continue expand assignment national health service corps doctors dentists health professionals underserved rural areas shortly announcing methods improve effectiveness rural housing programs greater emphasis home ownership rural americans agricultural exports want increase agricultural exports need competitive prices high quality products reserve supplies meet contingencies must remove unnecessary barriers exports must affirmative export policy 1977 administration doubled billion export credit program increased soviet grain purchase authorization 15 millions tons developed risk assurance program expanded efforts develop export markets around world year continue efforts especially reduce barriers agricultural trade sugar stabilize world sugar prices protect domestic negotiated international sugar agreement year major sugar producing countries seek congressional ratification agreement early 1978 sugar program required 1977 food agricultural act protect domestic sugar industry meantime rural development credit policy fiscal year 1977 farmers home administration provided nearly 7 billion loans four areas farming housing community facilities business industrial development expect provide least 1 billion current fiscal year small business administration took several steps 1977 strengthen small business small business administration expanded financial management assistance firms developed advocacy program represent small business interests federal departments agencies 1978 continue efforts support small business tax cuts special tax incentives reduced regulations programmatic reforms expanded sba loan authority meeting nation human needs administration constant concern meeting human needs americans past year moved number fronts make certain citizens well housed better educated properly cared need year pursue current initiatives areas launch new ones health past year active effort improve health citizens restrain skyrocketing health care costs mental health commission help develop national mental health program commission issue final report later year expect carefully consider commission findings campaign immunize 20 million children yet protected communicable childhood diseases part hew allow efficient delivery services cost savings reorganizations realized fully year legislation attack fraud abuse programs legislation make reimbursement available physician extenders rural clinics beneficial effects bill felt nation rural areas first time year 1978 administration continue efforts bring us better less costly health care hospital cost containment one main legislative goals year hospital cost containment bill bill would save hospital users 7 billion first two years enactment principal weapon effort decrease health care costs double every five years national health insurance submit congress later year national health insurance proposal congress time complete action proposal 1978 important begin national debate many complex issues involved national health insurance national health insurance solve health problems sensible national health policy also requires effective delivery preventive services better nutrition vigorous abatement environmental occupational threats health efforts change individual lifestyles endanger health national health insurance crucial step protect people ruinous medical bills provide citizen better access sound balanced health insurance coverage medicaid improvements children last year proposed child health assessment program improve early preventive screening diagnosis treatment program children medicaid administration press enactment measure urge expansion make additional million children eligible teenage pregnancy proposal propose legislation establish networks community based services prevent unwanted adolescent pregnancies need urge expansion existing family planning services reach additional teenagers drug abuse drug abuse threatens health safety children abroad continue efforts begun last year make drug abuse prevention control programs effective efficient world health year present strategy working directly nations international organizations raise standards health nutrition around world education last year congress adopted cooperation 15 increase education largest increase since enactment elementary secondary education act year continue demonstrate commitment improving nation education programs hew education budget expenditures increased 14 significant increases coming education disadvantaged assistance state programs education handicapped college student financial aid administration also work congress creation separate department education legislation replace reform expiring federal education acts legislative proposals concentrate basic literacy students prepared jobs education lifelong learning partnership federal state local governments augment existing programs propose legislation help low families meet rising college tuition costs also support significant expansion student aid programs income assistance past year made many improvements programs provide income assistance needy administration continue assign great importance area 1978 welfare reform proposed last year reform nation welfare system better jobs income act act would fundamentally reform current programs assist poor aid families dependent children supplemental security income food stamps programs single consolidated cash assistance program provides basic nationally uniform federal benefit efforts find jobs poor private sector creating million public service jobs heads families placed unsubsidized employment work incentives expanding earned income tax credit work actively congress coming year pass better jobs income act provide year budget pilot employment programs ready implement welfare reform program family children administration continue strong commitment strengthening american family expanding programs children administration propose year school breakfast program made mandatory schools high concentrations needy children propose major expansion special supplemental food programs women infants children among major actions 1978 white house conference families enactment proposed reforms foster care programs including new financial assistance aid adoption children doubling budget outlays child welfare services emphasis services help keep families together 200 million special funding day care title xx social security act also depend upon revitalized community services administration develop new approaches assist poor elderly last year saw enactment social security financing legislation assure system financial integrity next century year administration continue work strengthened legislation unwarranted age discrimination federal private sector propose legislation extend strengthen older americans act seek 13 increase funding programs providing daily meals elderly raising total daily meals served addition administration work assure contributions older americans sought efforts meet national needs housing last year made progress toward national goal decent home suitable environment every american family 1977 good year housing generally total new starts exceeding two million renewed federal government commitment housing needy early last year administration proposed major new initiatives meet housing needs central urban development strategy starts section 8 public housing subsidized programs 1977 look forward another 30 percent increase subsidized housing starts programs 1978 starts assisted housing rehabilitation loan programs reassess national housing needs goals current housing credit policies designed meet needs 1978 administration strengthen commitment meet housing needs communities variety expanded programs new initiatives housing assistance additional families help enable additional families homes total number families receiving housing assistance increase million 1977 million 1979 funds rehabilitation loan program section 312 expansion existing programs substantial renovations creation new moderate rehabilitation program section 8 major new operating subsidy program 1979 new program coupled improved management controls monitoring troubled projects intended reduce inventory defaulted projects aid restoring distressed urban areas department housing urban development made substantial progress 1977 reducing stock defaulted projects new program give department additional tools outlays program estimated total 52 million 1979 federal financing mechanism assisted housing projects use gnma tandem program targeted gnma tandem program provide subsidies designed bring families back cities rural housing programs residents including special program help poor families homes high levels production housing elderly handicapped transportation year build efforts made last year strengthen nation transportation system decreasing consumer costs pursuing increased energy efficiency improving safety new bilateral air services agreement new international air routes number american cities passive restraint systems new automobiles 1984 new fuel efficiency standards model automobiles work northeast corridor railroad improvement program airline deregulation bill also continue policy increasing competition reducing airfares international flights pursue additional bilateral agreements consumers already benefited reduced international fares improved service highway transit programs soon propose comprehensive highway transit program provide 45 billion total authorizations period program give states localities flexibility planning programming highway transit funding reducing number narrow categorical accounts using consolidated accounts wider range potential transportation projects addition make funding transportation programs uniform give localities control highway mass transit funds large urban areas highway safety administration propose legislation strengthen ore efforts highway safety reduce restrictions states use federal highway safety grant funds legislation earmark funds department transportation support important highway safety projects 55 mile per hour speed limit program inland waterway user fees users federal inland waterways pay fees pay substantial part cost constructing operating maintaining waterways administration continue work closely congress toward passage bill first time establish inland waterway user fees aircraft noise abatement administration seek passage legislation control aircraft noise automobile insurance continue support legislation establish federal minimum standards automobile insurance veterans 1977 took number steps make certain country continues meet special needs millions veterans legislation passed increase compensation benefits service connected disabilities benefits bill veterans pension benefits millions veterans feel effects increases year 1978 improve veterans programs review problems vietnam veterans means current programs made effective meeting needs new programs deal problems alcohol drug abuse psychological readjustment increased benefits disabilities improvements veterans pension program special employment programs veterans arts humanities americans increasingly aware arts humanities preserve transmit heritage enrich lives contribute significantly social economic nation administration committed fostering highest standards creativity scholarship open partnership public private believe products commitment must available many americans wish share year substantial increases budgets arts humanities endowments demonstrate strong belief value programs making government efficient responsive government employees civil service reform civil service system often bureaucratic maze stifles initiative dedicated government employees inadequately protecting rights million civil servants governed outdated rules institutions keep efficient would like one frustrated system public servants therefore one major priorities 1978 ensure passage first comprehensive reform system since creation nearly century developed direct involvement civil servants early year congress receive legislation reorganization plan institutions run civil service safeguards abuses official power greater incentives managers improve government efficiency responsiveness system red tape delays procedures dealing employee grievances disciplinary actions equal employment opportunities effective last year administration acted protect federal employees loss job due reorganization protection maintained hatch act reform continue support reform hatch act would restore right civil service employees participate political process employment help obtain federal jobs elderly handicapped women others family responsibilities federal agencies carry forward renewed efforts increase employment opportunities reorganization management regulatory reform government reorganization project keep working make government responsive efficient last year combined parts 11 agencies one department energy streamlined executive office president reduced white house staff proposed abolition nearly 500 advisory committees small agencies addition upcoming civil service education reform efforts soon submit proposals restructure equal employment programs provide better protection rights minorities women ease burden compliance state local government well business improve administration justice reorganize disaster assistance programs additional studies way many areas several result reorganization proposals later year efforts improve federal cash management continue also vigorously pursuing effort begun last year reduce burden outdated ineffective nitpicking regulations example department health education welfare eliminated 5 regulations federal trade commission rescinded 111 outdated sets rules trade practices civil aeronautics board interstate commerce commission moved allow competition led lower prices 1978 continue efforts worker health safety occupational health safety administration already slashed paperwork requirements 50 eliminated unnecessary regulations improving capacity protect workers spring task force worker safety make recommendations increase protection workers minimize employer cost airline regulatory reform last year signed legislation deregulating cargo air transportation year continue work passage airline regulatory reform bill passengers bill allow air carriers compete lower fares new services new markets without excessive government interference disruption service small communities trucking regulatory reform forty years tight government controls done enough bring us competitive prices good service efficient use fuel consider measures bring competition motor carrier area drugs propose legislation reform regulation drug industry protect consumer make regulations fairer less burdensome regulatory process early 1978 issue executive order improve regulatory process order require officials responsible regulations sign assure officials fully involved process require regulations written plain english make easier public participate process increase coordination agencies overlapping responsibilities require closer look cost regulations issued require sunset reviews existing regulations also set interagency committee help regulatory agencies review economic effects major regulations sure costs proposed regulation fully considered way able identify least costly means achieving regulatory goals paperwork reduction 1977 administration decreased 12 paperwork burden government imposes people done eliminating consolidating simplifying decreasing frequency reports savings equivalent workers filling federal forms full year departments agencies currently setting goals substantial reductions 1978 reporting requirements associated programs subject sunset review ended unless found necessary addition reviewing recommendations commission federal paperwork labor law reform last year proposed legislation reform nation labor laws order streamline conduct elections employee representation strengthen enforcement powers national labor relations board work closely congress ensure early passage bill one highest legislative goals year election reform last year supported proposals make elections fairer honest included public financing congressional campaigns amendments federal election campaign act election reforms administration continue support congressional action measures consumer reform taken many actions benefit consumers reducing costs improving quality safety products one consumer initiative merits separate creation office consumer representation supported legislation last year create office interests consumers could represented one government agency office would require additional government employees expenditures since would merely consolidate consumer offices already exist throughout government strongly committed legislation regard enactment one year primary legislative priorities public broadcasting reform proposed legislation last year strengthen public broadcasting service providing increased federal support insulation political pressure better coordination among national organizations run public broadcasting opportunity citizens participate local level administration work congress year pass reforms openness integrity one primary goals make certain government ethical standards high fully observed must ensure government open responsive american people last year took steps direction requiring senior officials administration publicly disclose income assets pledge business agencies two years leaving government service increase government openness took steps make certain well letter freedom information act observed tried bring presidency people citizen forums discussion panels throughout country year continue efforts concentrating primary attention areas lobby reform administration press legislation requiring registration lobbyists thorough public disclosure lobbying activities legislation help reestablish confidence trust government ethics applaud strong ethical codes adopted last year house senate believe codes standards established administration officials made law clearly apply public officials future urge congress pass public officials integrity act year classification completing study classification systems government documents shortly issue executive order designed eliminate improper unnecessary classification ensure documents declassified rapidly justice civil rights equal opportunity americans fundamental civil rights requiring government must afforded equal opportunities participate full members society 1977 principle guided administration numerous areas plan make certain year efforts behalf civil rights equal opportunities continue unabated nation concern human rights must heard clearly home abroad educational opportunities 1977 administration vigorously attacked educational discrimination elementary secondary higher education levels major suit pursued ensure university level time recognized reaffirmed importance affirmative action programs ensure equal opportunities educational institutions brief bakke case efforts eliminate discrimination promote affirmative action programs relying flexible goals rather quotas continue full force handicapped hew issued regulations guidelines implement legislation guaranteeing equal access programs receiving financial assistance hew year cabinet departments issue similar regulations rights handicapped americans begin fully observed providing 50 million loan fund states institutions enable comply regulations eliminate barriers prevent access handicapped citizens federally assisted programs activities proposing major increase funding education handicapped children act equal opportunity past year administration reaffirmed executive order 11375 prohibits discrimination basis sex federal employment addition voluntarily placed executive office president title vii civil rights act year part effort eliminate sex discrimination unemployment education continue urge ratification equal rights amendment constitution past year equal employment opportunity commission reorganized increase efficiency result commission made substantial progress reducing backlog complaints 40 increase funding proposed 1979 budget eeoc able reduce backlog early year propose congress reorganization plan concerning equal opportunity enforcement strengthen eeoc boycott strongly supported signed legislation prohibit american participation secondary economic boycotts foreign countries law strictly enforced administration year regulations issued department commerce minority business last year started number programs make opportunities available businesses effort continued strengthened year half way toward two year goal 2 billion federal purchases services goods firms reach goal end year raise goal federal deposits banks 1977 level 100 billion continue enforce 400 million minority business provision local public works act may exceed target continue implement minority business policy established contracts let east corridor railroad improvement program undocumented aliens last year proposed legislation impose sanctions employers hire undocumented aliens change legal status many undocumented aliens residing country legislation would afford undocumented aliens residing continuously since 1970 opportunity apply permanent resident status would create new temporary resident status undocumented aliens resided continuously 1970 january 1 1977 want work congress year toward passage undocumented aliens bill social economic problem longer ignored native americans administration acted consistently uphold trusteeship responsibility native americans also elevated post commissioner indian affairs level assistant secretary interior 1978 administration review federal native american policy step efforts help indian tribes assess manage natural resources legal judicial reform last year administration began number major efforts improve nation legal judicial system intend pursue related efforts fully year criminal code reform worked closely members congress develop proposed revision nation criminal code revision codify one part code federal crime laws reform many outdated inconsistent criminal laws administration work closely congress year seek passage first complete codification nation criminal laws judicial reform federal judicial system suffered many years inadequate number judges continue work congress omnibus judgeship bill correct problem also continue efforts use judges effectively legislation proposed expand significantly authority magistrates increase use arbitration tighten federal jurisdiction work year complete congressional action bills wiretap reform last year proposed legislation reforming approach electronic surveillance foreign intelligence purposes affording greater protection citizens essentially legislation would require government obtain court order beginning foreign intelligence wiretaps country administration supports early passage much needed legislation enforcement competition nation laws must vigorously enforced therefore recently established presidential commission review federal enforcement make recommendations year last year initiated new program administered department justice provide grant funds state attorneys general order strengthen enforcement state level expect see results program year reducing government regulation increase competition thereby lower consumer costs year continue deregulatory efforts legislative administrative areas order reduce practices abuses crime reduction criminal justice past year reorganization project justice department developing proposals reorganize improve nation criminal justice system order strengthen enforcement ensure equal justice year sending message congress criminal justice crime reduction message include proposals federal law enforcement assistance administration criminal research efforts better law enforcement methods organized crime white collar crime drug abuse public corruption minimum standards federal correctional institutions fbi intelligence agencies charters plan issue comprehensive executive order govern intelligence activities fbi cia nsa defense department executive order basis administration recommendations legislative charters governing activities fbi various intelligence agencies privacy privacy protection study committee recently proposed extensive list new legislative regulatory safeguards administration analyzing recent proposals develop year program ensure personal privacy adequately protected district columbia proposed last year series reforms including full voting representation congress designed give residents district significantly greater control local affairs administration continue work passage reforms year developing protecting natural resources energy national energy policy april 1977 proposed nation comprehensive national energy policy policy based three principles continue guide progress 1978 must learn use energy efficiently carefully conservation measures including retrofitting buildings factories homes must shift oil natural gas becoming scarce coal renewable sources energy abundance must provide fair prices producers energy encourage development new supplies without permitting windfall profits debate comprehensive policy long arduous number difficult contentious issues remain settled confident however congress recognizes seriousness energy problem act expeditiously program early year securing passage acceptable energy fair consumers provides needed energy savings prudent fiscal budgetary continue highest urgent national priority 1978 energy statutes actions already begun lay strong foundation implementation national energy policy 1977 took steps put place important policies structural reforms needed meet energy goals new department energy combines first time major governmental functions energy research regulation pricing policy information collection dissemination overall policy development without strong organization would hope implement comprehensive national policy approved proposed route pipeline bring natural gas north slope alaska lower 48 states emergency natural gas act cope hardships last winter freeze assure high priority gas users cut supply emergencies 4 billion store first 500 million barrels oil strategic petroleum reserve already begun fill reserve remain committed 1 billion barrel strategic reserve 1985 outer continental shelf legislation legislation improve management outer continental shelf oil gas development major item unfinished business pending congress prompt passage necessary benefit new law move open offshore areas development production bill mandates reforms leasing program provide necessary development offshore oil gas enhancing competition among oil companies assuring public receives fair return sale public oil gas resources protecting marine coastal resources nuclear energy united states also advanced policy prevent proliferation nuclear weapons around world international nuclear fuel cycle evaluation established wide international participation examine alternatives existing technologies addition legislation proposed last year establish better controls export nuclear fuels technologies work congress secure passage legislation early 1978 commitment preventing spread nuclear weapons led us reorient domestic nuclear policies deferred indefinitely commercial reprocessing spent nuclear fuel plutonium recycling clinch river plant would waste 2 billion teaching us little already know learn existing nuclear research development program recommended clinch river breeder project stopped represents premature unwise commitment commercialization technology need however intend continue develop nuclear energy nation needs continue move forward major research program breeder technology begin implement program government management spent fuel nuclear reactors 1978 administration work towards policy safe permanent disposal nuclear wastes 1978 beyond carry vigorous nuclear research development program designed give us safe technologies reduce danger nuclear proliferation environmentally responsible also seek improve current system licensing nuclear power reactors order cut bureaucratic delays firmly maintaining strengthening health safety environmental requirements propose nuclear licensing legislation congress year environment one deepest personal commitments clean healthy environment citizens last may outlined administration environmental priorities policies comprehensive environmental message working closely congress made good progress many measures contained message continue guide administrative legislative actions 1978 overall environmental outlays 10 provide new staff resources necessary ensure nation environmental laws obeyed best way enforcing landmark environmental statutes enacted 1977 taking considerations science public policy account several important initiatives including national heritage program designation national interest lands alaska manage precious natural resources better preserve heritage environmental statutes 1977 worked closely congress enact three significant environmental statutes recent years surface mining control reclamation act establishes joint program make sure use economically environmentally sound practices also sets fund reclaim lands ravaged uncontrolled careless mining provides clear stable policy direction operators clean air act amendments establish strict achievable standards auto emissions ensure continued progress reducing pollution stationary air pollution sources clean water act authorizes many important water cleanup programs protect nation wetlands without unnecessary federal requirements act also reforms sewage treatment construction grant program gives strong emphasis control toxic chemicals environment provide leadership funding necessary carry new laws water policy 1977 effort begun ensure federal programs policies provide sound fair management limited valuable water resources began complete review federal water policy completed year close consultation congress states public propose measures needed carry recommendations study also continue strong dam safety inspection program initiated late last year make sure dams public private safe alaska lands last year sent congress proposal use federal lands alaska proposal protect 92 million acres public create expand 13 national parks reserves 13 national wildlife refuges confer wild scenic river status 33 waterways hope congress adopt measures needed year preserve unique natural treasures alaska time permit orderly development alaskan resources redwood national park redwood national park contains nation largest oldest trees last year protect trees destruction commercial logging edges park legislation proposed expand boundaries press congressional action bill 1978 national heritage program shortly proposing program preserve unique elements natural cultural heritage program modeled successful ones several states administered department interior although many necessary steps taken administratively seek new legislative authority 1978 federal compliance environmental laws administration committed principle federal government must set good example compliance environmental laws regulations established private sector far unfortunately federal record found wanting 1979 budget includes money bring federal facilities compliance existing environmental laws regulations federal reclamation 1977 began thorough review 1902 reclamation act study completed reviewed year propose congress changes needed modernize law mining law reform last year administration proposed legislation replace archaic 1872 mining law modern leasing system mineral resources 1872 system resulted withdrawal large areas land mineral exploration tool environmental protection administration proposal would establish balanced system public interests mineral development environmental protection revenue treasury accomplished special provisions would minimize burdens small operators provide incentives exploration oil spills last year proposed congress legislation would establish strict liability standards oil tanker spills would improve regulations aimed preventing future oil spills legislation still needed science technology health american science technology creation new knowledge important economic national security ability help solve pressing national problems areas energy environment health natural resources recommending program real growth scientific research steps strengthen nation research centers encourage new surge technological innovation american industry budget increase 11 basic research lead improved opportunities young scientists engineers upgraded scientific equipment nation research centers determined maintain nation leadership role science technology continue america progress field space exploration continued development space shuttle system procurement four shuttle orbiters operations east west coasts development spacecraft study first time polar regions sun increased outlays demonstrations practical applications systems development space technology foreign affairs year ago set five goals united states foreign policy late 1970 early 1980 reassert america moral leadership strengthen traditional ties friends allies work toward international system promote regional reconciliation preserve peace preparedness arms control goals continue underlie agenda 1978 moral leadership past year placed american foreign policy new course consistent values highest ideals american people trying limit worldwide sale arms trying prevent nuclear ability make spreading countries building new relationship developing countries promoting human rights throughout world human rights virtually everywhere human rights become important countries systematically violated real progress united states take credit taken lead among western nations belgrade review conference security cooperation europe working closely allies neutral nations ambassador arthur conducted thorough review implementation helsinki final act aspects made clear united states committed full implementation final act areas seek review conference two years meanwhile press better implementation helsinki final act must ignore enormous dangers posed unrestrained spread nuclear weapons technology recognize benefits commercial nuclear power also must acknowledge risks believe countries enjoy benefits risks minimized developing safer technologies creating new institutions manage safeguard phases nuclear fuel cycle meanwhile decided postpone premature commitment technologies yet safely manage commercial scale seeking persuade others sound economic energy reasons likewise arms sales world threatened spiraling increase trade conventional arms arms increase likelihood conflict also divert resources human needs easy slow spiral begin cut back sales recognition fact world principal seller duty take first step know efforts succeed major arms suppliers recipients cooperate ties friends allies energy crisis underscored reality interdependence among nations need stable international financial trading system actions reflect belief consultations traditional friends dialogue developing nations way united states provide economic political leadership world expects us working allies past year united states restored traditional friends allies center foreign policy within days inauguration vice president visited brussels rome bonn paris reykjavik tokyo met frequently washington european japanese leaders participated economic summit london 1977 nato summit summit leaders britain germany france beginning 1978 visited france brussels made first visit american president headquarters european community also consulted european allies diverse subjects salt mbfr middle east africa human rights belgrade conference energy nonproliferation global economy relations intensify efforts year expanding list include close consultations allies major arms control issues may host nato summit washington also planning another economic summit year shown dealings japan close allies find solutions shared problems early year concerned nuclear reprocessing japan flexibility goodwill sides suitable accommodation reached building nuclear reprocessing plant recently reached agreement japanese ways deal large current account surplus trade economic talks another example constructive action international economic cooperation working improve extend international economic system strengthen international economic institutions ensure international economic competition takes place orderly fashion seek improve cooperation among nations imf gatt world bank oecd international organizations enabled us maintain open liberal trade payments system american economy remains strong competitive position international trade excellent 1977 merchandise exports exceeded imports except oil large amount inflation rate among lowest industrial world balance trade payments incurred large worrisome deficit two main causes 1977 45 billion flowed pay imported oil wiped would otherwise trade surplus demand foreign goods much greater demand american goods abroad 1977 american gnp increased roughly twice fast real terms gnp main trading partners background exchange rate dollar declined relative currencies japan germany switzerland european countries developments led disorderly conditions exchange markets december made clear united states would intervene counter disorders done assure integrity dollar must act need healthy growing united states economy adequate investment prudent budget declining inflation make us competitive attractive foreign investors need conserve energy develop alternative sources supply reduce dependence imported oil cut outflow dollars need see vigorous world economy stronger growth particularly countries like germany japan switzerland netherland help reduce deficits bring stability international payments factors already work reduce trade deficit economic activity europe elsewhere rise oil imports level year effect new exchange rates already occurred full effect realized improve trade balance several billions dollars trade payments deficit 1978 large external position show improvement must also augment capacity deal possible strains pressures strengthening international trade monetary system urge congress act promptly approve united states participation imf supplementary financing facility trading nations world engaged negotiations reduce barriers improve international trading system reciprocal balanced opening markets freer trade enable us use world resources efficiently contribute economic growth also attempt strengthen rules regulated international trade last 30 years international competition must take place within framework agreed rules recognized appropriate fair developing countries one critical issues facing united states economic political relationship developing countries economy become visibly dependent developing world supplies markets dialogue throughout 1975 1976 united states developed countries worked group developing nations conference international economic cooperations ciec dialogue reached agreement issues june 1977 remain number unresolved questions united states continue consult negotiate developing countries questions like commodity price stabilization technology common fund international buffer stocks pursue dialogue months ahead confident developed nations developing nations agree upon measures let nations participate fully management world economy africa relations africa involve energy human rights economic development dialogue maputo lagos conferences demonstrated african countries discuss difficult problems us mutual advantage relations nigeria improved dramatically administration fy 79 budget substantially increases development assistance africa including continued support african development fund programs help african governments meet people basic human needs growth african regional institutions like sahel development fund important african development administration approach latin america caribbean recognizes region diversity placed great importance protection defense human rights halting proliferation nuclear weapons capabilities restraining conventional arms sales contributing settlement disputes engaging latin governments global economic negotiations seeking senate ratification protocol treaty tlatelolco american convention human rights caribbean group trying promote regional development intend help several nations develop alternative energy sources panama general torrijos signed two panama canal treaties september 9 7 1977 treaties meet legitimate interests panama united states guarantee permanent right protect defend canal contribute importantly regional stability asia united states sought underline desire close relationship developing countries asia visit continent regular contacts member countries association southeast asian nations welcome cooperation asean developed countries region japan australia promoting regional reconciliation greatest danger world peace stability war among great powers war among small nations past year united states helped promote productive negotiations two troubled regions middle east southern africa also tried settle conflicts horn africa cyprus negotiated two panama canal treaties enhance country relations nations latin america middle east effort break rigid approaches past bring overall peace settlement looked three basic principles normalization political economic cultural relations peace treaties withdrawal armed forces occupied territory recognized secure borders establishment effective security measures resolution palestinian question significant progress toward peace middle east made last year particularly applaud president sadat courageous initiative reciprocated prime minister begin launching direct negotiations united states continue year encourage parties resolve conflict southern africa entering administration inherited problems rhodesia namibia south africa british united states launched new rhodesian discussions last year plan september 1 sets forth fair workable principles majority rule transition period leading free elections un presence constitution judicially protected bill rights zimbabwe development fund contact group united states participates held discussions south africa southwest africa peoples organization interested parties internationally acceptable settlement independent namibia majority rule effort produced wide agreement including provisions substantial un presence united states told south african prime minister unless nation begins progressive transformation toward full political participation people relations suffer supported union nations arms embargo south africa prohibited gray area sales began review south african economic relations horn africa arms supplied soviet union fuel sides conflict horn africa somalia ethiopia danger soviet union cuba commit soldiers conflict transforming local war confrontation broader strategic implications deplore fact disagreements region assistance outside bloody conflict made clear sides supply arms aggressive purposes recognize forcible changes boundaries want see fighting end parties move battlefield negotiating table cyprus hope groundwork laid 1977 permanent settlement cyprus encouraging movement direction preserving peace past year administration assessed threats allies security well collective strength combat threats sought promote responsible arms control efforts reduce competition arms recognizing strong defense foundation security made certain defense spending sufficient used maximum effect arms control fundamental purposes arms limitations efforts promote national security strengthen international stability thereby enhancing prospects peace everywhere trying move strategic arms limitation talks toward ambitious objectives want reduce contain competition number strategic weapons possessed united states soviet union limit qualitative improvements weapons merely raise risks us precisely determination obtain objectives negotiations difficult prolonged however confident agreement present congress meet also made solid progress toward objective united states pursued many years comprehensive treaty banning nuclear explosions treaty open nations world major step toward reduced reliance weapons toward halting spread world time seeking arms limitations agreements soviet union contribute security stability various regions world europe nato allies seeking mutual balanced force reductions agreement achieve greater stability balance lower levels forces indian ocean neither soviet union yet deployed military power large scale working agreement prevent major military competition first time begun negotiate soviet union outlines treaty banning chemical warfare essential element american security maintenance stability western pacific united states plays major role maintaining balance power seeking readjust military presence korea reducing ground forces peninsula undertaking compensatory measures ensure adequate balance forces remain talking filipino government future military bases continuing process normalization relations people republic china within framework shanghai communiqué last year sought halt worldwide spread nuclear weapons capacity nearly 40 nations joined us effort find nuclear power sources readily used building nuclear weapons defense defense budget recommending congress fulfill pressing defense needs requesting increases defense spending compensate inflation needed maintain adequate military balance face continued soviet military efforts negotiate soviets strategic arms continuing preserve essential equivalence strategic nuclear strength technological advantage soviet union apparent building cruise missiles together upgraded assure capability element triad continuing develop missile system case need deploy budget requesting funds continued increase trident submarine force important strategic program submarines hard enemy destroy nato allies trying improve initial combat capability nato forces improve readiness critical combat units enhance american capability send ground tactical air forces reinforcements increase permanent forces lay foundation future improvements budget propose requests 18 increases procurement equipment army united states taking steps alone participating mutual effort importance sea forces united states national security undisputed navy receives largest share defense budget requesting funds continue modernization need examine appropriate size mix united states naval forces future therefore deferred spending new aircraft carriers current defense department study completed early year maintain naval strength capability deploy rapidly light effective combat force worldwide necessary without overseas base support end requesting funds vigorous airlift enhancement program ways seeking develop foreign policy wider scope foreign policy recognizes global diversity foreign policy builds stable international system jimmy carter white house january 19 1978
tonight state union address concentrate year high strong energy bill coordinate economic program job creation tax reduction tax reform measure make government effective efficient maintain peace strong national defense ratify panama canal treaty complete salt ii treaty important congress nation also understand important initiative goal 1978 therefore send congress separate detail state union message describe administration priority area fully cover address domestic affair number serious domestic problem face nation take office one year ago economy yet fully recover recession country sound energy policy federal government operate inefficiently ineffectively many area concern openness integrity government remain aftermath watergate many press social problem address 1977 administration solve problem congress join u tackle many issue together make progress year pass believe confident people trust institution country move prepared address problem boldness confidence home abroad reassert concern problem people home reaffirm position moral leadership world year domestic goal continue reflect concern guide action 1977 restore economic prosperity meeting nation human need make government efficient responsive develop protect natural resource restore economic prosperity devote substantial part state union address need comprehensive economic program devote bulk economic report congress deliver tomorrow complete description administration economic goal objective message therefore repeat statement want set forth briefly key element proposal 23 billion income tax cut 1979 17 billion go individual family 6 billion go business tax reform program design make tax law fairer simple program design reduce annual increase wage price cooperation labor business federal government set example reduction 2 billion excise payroll tax also make contribution reduce inflation extension fund public service ceta job 700 million increase spending youth employment effort major new 400 million private sector job initiative design primarily encourage business hire unemployed minority youth plan work closely congress secure prompt action economic proposal adoption help achieve kind economic prosperity nation u want along sound energy bill enactment economic proposal high domestic priority 1978 energy high priority prompt enactment comprehensive energy legislation along line submit congress last spring huge oil price increase contribute inflation 1974 bad recession 40 year price hike also principal foreign trade deficit contribute weakness dollar abroad unless act energy problem rapidly get bad failure act fuel inflation erode value dollar render u vulnerable disruption oil supply limit economic progress year come confident congress respond nation clear need enact responsible balance energy legislation early year employment last year make considerable progress effort reduce unemployment unemployment rate decrease year million new job create unemployment fell million worker action take part 21 billion economic stimulus package substantially help u achieve favorable result 1978 administration continue effort reduce unemployment still increase employment opportunity americans part budget propose fund increase youth program 260 1976 level provide billion outlays employment training young worker 400 million private sector employment program focus youth disadvantaged worker aim mobilize private industry work government find job implement business council establish throughout country ceta job 1979 tie future year national unemployment rate begin demonstration program job component good job income program legislation administration seek passage full employment balance growth act act help administration congress plan effort reduce unemployment create job maintain reasonable price stability enactment would serve live memorial late senator hubert humphrey private sector job administration plan major 400 million effort involve business labor training hire unemployed program closely tie federal employment system private sector use business council confident private sector respond positively call help nation solve one serious problem employment youth minority inflation although inflation lower recent past still must keep step administration take include business investment contain tax proposal increase productive investment thereby help u hold price cost excise unemployment tax propose new budget reduction needlessly complex federal regulation establish interagency committee review effect regulation economy continue effort regulatory reform airline industry elsewhere special effort hold soar cost health care enactment hospital cost containment act government solve problem alone especially business labor consumer accel ted inflation fact life adjust behavior accordingly therefore ask business labor undertake voluntarily new program reduce inflation ask industry aim small price wage increase 1978 average last two year major employer federal government take lead effort voluntary cooperation one reduce inflation without unacceptable government interference coercion urban assistance community development administration congress take major step last year meet needs city increase fund community development block grant billion three year provide alternative formula allocate fund responsive need distressed urban area next year recommend increase 150 million 1978 level community development block grant program enact new program urban development action grant annual level 400 million extend expanded fiscal assistance arfa propose arfa program expire september 30 1978 extend evaluate possible revision program fund make recommendation congress within two month administration also study closely possible need extend federal lending new york city current legislation expire june 30 1978 commit along state city preserve city solvency extend lending necessary purpose propose however interested party must contribute permanent solution spring submit congress message outline administration urban policy base work urban regional policy group chair secretary housing urban development design make exist federal program effective involve new initiative resource address urban need problem city structural nature correct effort administration commit continue effort meet stubborn problem change need urban policy proposal effective partnership federal government state local government private sector neighborhood group concerned citizen sufficiently flexible meet diverse need urban area respond particular problem distress area fiscal need hardpressed urban government well economic social need city resident urban physical environment strengthen urban community federal assistance stimulate investment private sector encourage innovative action state local government agriculture rural development decent farm income strong family farm system vital national economic stability strength long farm price many commodity severely depress work congress past year adopt new program policy design strengthen farm income ensure abundant reasonably price food consumer partially result policy program farm price improve nevertheless satisfied economic condition many american farmer today continue monitor agricultural economy work congressional farm leader make certain federal program policy carry effectively food agriculture act past year work congress enact new comprehensive food agriculture act protect producer consumer also exercise authority wheat feed grain protect farm income year expect pay farmer billion price support program new farm bill become effective october 1 1977 achieves change agricultural policy include governmental intervention market decision farmer make support loan major commodity permit u remain competitive world market grain reserve design remove excess product market hold supply short support level base grain reserve last year initiate plan place million metric ton food feed grain reserve establish reserve add strength stability market provide hedge export control grain grain own controlled farmer strengthen farmer control grain help keep grain government ownership term farmer storage facility loan program liberalize 1978 administration propose international emergency grain reserve 6 million metric ton help u meet food aid commitment abroad agricultural disaster drought aid record drought 1977 work congress pas 844 million emergency drought assistance program year ask congress eliminate many inconsistency inequity exist disaster aid program continue give high priority address effect drought begin abate take step improve life rural america recently sign law encourage well delivery health service rural community continue expand assignment national health service corp doctor dentists health professional underserved rural area shortly announce method improve effectiveness rural housing program great emphasis home ownership rural americans agricultural export want increase agricultural export need competitive price high quality product reserve supply meet contingency must remove unnecessary barrier export must affirmative export policy 1977 administration double billion export credit program increase soviet grain purchase authorization 15 million ton develop risk assurance program expand effort develop export market around world year continue effort especially reduce barrier agricultural trade sugar stabilize world sugar price protect domestic negotiated international sugar agreement year major sugar produce country seek congressional ratification agreement early 1978 sugar program require 1977 food agricultural act protect domestic sugar industry meantime rural development credit policy fiscal year 1977 farmer home administration provide nearly 7 billion loan four area farm housing community facility business industrial development expect provide least 1 billion current fiscal year small business administration take several step 1977 strengthen small business small business administration expand financial management assistance firm develop advocacy program represent small business interest federal department agency 1978 continue effort support small business tax cut special tax incentive reduce regulation programmatic reform expand sba loan authority meeting nation human need administration constant concern meeting human need american past year move number front make certain citizen well house well educate properly care need year pursue current initiative area launch new one health past year active effort improve health citizen restrain skyrocket health care cost mental health commission help develop national mental health program commission issue final report later year expect carefully consider commission finding campaign immunize 20 million child yet protect communicable childhood disease part hew allow efficient delivery service cost saving reorganization realize fully year legislation attack fraud abuse program legislation make reimbursement available physician extenders rural clinic beneficial effect bill felt nation rural area first time year 1978 administration continue effort bring u good less costly health care hospital cost containment one main legislative goal year hospital cost containment bill bill would save hospital user 7 billion first two year enactment principal weapon effort decrease health care cost double every five year national health insurance submit congress later year national health insurance proposal congress time complete action proposal 1978 important begin national debate many complex issue involve national health insurance national health insurance solve health problem sensible national health policy also require effective delivery preventive service good nutrition vigorous abatement environmental occupational threat health effort change individual lifestyle endanger health national health insurance crucial step protect people ruinous medical bill provide citizen good access sound balance health insurance coverage medicaid improvement child last year propose child health assessment program improve early preventive screening diagnosis treatment program child medicaid administration press enactment measure urge expansion make additional million child eligible teenage pregnancy proposal propose legislation establish network community base service prevent unwanted adolescent pregnancy need urge expansion exist family planning service reach additional teenager drug abuse drug abuse threaten health safety child abroad continue effort begin last year make drug abuse prevention control program effective efficient world health year present strategy work directly nation international organization raise standard health nutrition around world education last year congress adopt cooperation 15 increase education large increase since enactment elementary secondary education act year continue demonstrate commitment improve nation education program hew education budget expenditure increase 14 significant increase come education disadvantage assistance state program education handicap college student financial aid administration also work congress creation separate department education legislation replace reform expire federal education act legislative proposal concentrate basic literacy student prepare job education lifelong learn partnership federal state local government augment exist program propose legislation help low family meet rise college tuition cost also support significant expansion student aid program income assistance past year make many improvement program provide income assistance needy administration continue assign great importance area 1978 welfare reform propose last year reform nation welfare system well job income act act would fundamentally reform current program assist poor aid family dependent child supplemental security income food stamp program single consolidated cash assistance program provide basic nationally uniform federal benefit effort find job poor private sector create million public service job head family place unsubsidized employment work incentive expand earn income tax credit work actively congress coming year pas well job income act provide year budget pilot employment program ready implement welfare reform program family child administration continue strong commitment strengthen american family expand program child administration propose year school breakfast program make mandatory school high concentration needy child propose major expansion special supplemental food program woman infant child among major action 1978 white house conference family enactment propose reform foster care program include new financial assistance aid adoption child double budget outlay child welfare service emphasis service help keep family together 200 million special funding day care title xx social security act also depend upon revitalize community service administration develop new approach assist poor elderly last year saw enactment social security finance legislation assure system financial integrity next century year administration continue work strengthen legislation unwarranted age discrimination federal private sector propose legislation extend strengthen old american act seek 13 increase funding program provide daily meal elderly raise total daily meal serve addition administration work assure contribution old american seek effort meet national need housing last year make progress toward national goal decent home suitable environment every american family 1977 good year housing generally total new start exceed two million renew federal government commitment housing needy early last year administration propose major new initiative meet housing need central urban development strategy start section 8 public housing subsidize program 1977 look forward another 30 percent increase subsidize housing start program 1978 start assist housing rehabilitation loan program reassess national housing need goal current housing credit policy design meet need 1978 administration strengthen commitment meet housing need community variety expand program new initiative housing assistance additional family help enable additional family home total number family receive housing assistance increase million 1977 million 1979 fund rehabilitation loan program section 312 expansion exist program substantial renovation creation new moderate rehabilitation program section 8 major new operate subsidy program 1979 new program couple improved management control monitor troubled project intend reduce inventory default project aid restore distressed urban area department housing urban development make substantial progress 1977 reduce stock default project new program give department additional tool outlays program estimate total 52 million 1979 federal financing mechanism assist housing project use gnma tandem program target gnma tandem program provide subsidy design bring family back city rural housing program resident include special program help poor family home high level production housing elderly handicap transportation year build effort make last year strengthen nation transportation system decrease consumer cost pursue increase energy efficiency improve safety new bilateral air service agreement new international air route number american city passive restraint system new automobile 1984 new fuel efficiency standard model automobile work northeast corridor railroad improvement program airline deregulation bill also continue policy increase competition reduce airfare international flight pursue additional bilateral agreement consumer already benefit reduced international fare improve service highway transit program soon propose comprehensive highway transit program provide 45 billion total authorization period program give state locality flexibility plan program highway transit funding reduce number narrow categorical account use consolidated account wider range potential transportation project addition make funding transportation program uniform give locality control highway mass transit fund large urban area highway safety administration propose legislation strengthen ore effort highway safety reduce restriction state use federal highway safety grant fund legislation earmark fund department transportation support important highway safety project 55 mile per hour speed limit program inland waterway user fee user federal inland waterway pay fee pay substantial part cost construct operate maintain waterways administration continue work closely congress toward passage bill first time establish inland waterway user fee aircraft noise abatement administration seek passage legislation control aircraft noise automobile insurance continue support legislation establish federal minimum standard automobile insurance veteran 1977 take number step make certain country continue meet special need million veteran legislation pass increase compensation benefit service connect disability benefit bill veterans pension benefit million veteran feel effect increase year 1978 improve veteran program review problem vietnam veteran mean current program make effective meeting need new program deal problem alcohol drug abuse psychological readjustment increase benefit disability improvement veteran pension program special employment program veteran art humanity american increasingly aware art humanity preserve transmit heritage enrich live contribute significantly social economic nation administration commit foster high standard creativity scholarship open partnership public private believe product commitment must available many american wish share year substantial increase budget art humanity endowment demonstrate strong belief value program make government efficient responsive government employee civil service reform civil service system often bureaucratic maze stifle initiative dedicated government employee inadequately protect right million civil servant govern outdated rule institution keep efficient would like one frustrated system public servant therefore one major priority 1978 ensure passage first comprehensive reform system since creation nearly century develop direct involvement civil servant early year congress receive legislation reorganization plan institution run civil service safeguard abuse official power great incentive manager improve government efficiency responsiveness system red tape delay procedure deal employee grievance disciplinary action equal employment opportunity effective last year administration act protect federal employee loss job due reorganization protection maintain hatch act reform continue support reform hatch act would restore right civil service employee participate political process employment help obtain federal job elderly handicap woman others family responsibilities federal agency carry forward renew effort increase employment opportunity reorganization management regulatory reform government reorganization project keep work make government responsive efficient last year combine part 11 agency one department energy streamline executive office president reduce white house staff propose abolition nearly 500 advisory committee small agency addition upcoming civil service education reform effort soon submit proposal restructure equal employment program provide good protection right minority woman ease burden compliance state local government well business improve administration justice reorganize disaster assistance program additional study way many area several result reorganization proposal later year effort improve federal cash management continue also vigorously pursue effort begin last year reduce burden outdated ineffective nitpicking regulation example department health education welfare eliminate 5 regulation federal trade commission rescind 111 outdated set rule trade practice civil aeronautics board interstate commerce commission move allow competition lead low price 1978 continue effort worker health safety occupational health safety administration already slash paperwork requirement 50 eliminate unnecessary regulation improve capacity protect worker spring task force worker safety make recommendation increase protection worker minimize employer cost airline regulatory reform last year sign legislation deregulate cargo air transportation year continue work passage airline regulatory reform bill passenger bill allow air carrier compete low fare new service new market without excessive government interference disruption service small community truck regulatory reform forty year tight government control do enough bring u competitive price good service efficient use fuel consider measure bring competition motor carrier area drug propose legislation reform regulation drug industry protect consumer make regulation fair less burdensome regulatory process early 1978 issue executive order improve regulatory process order require official responsible regulation sign assure official fully involved process require regulation write plain english make easy public participate process increase coordination agency overlap responsibility require close look cost regulation issue require sunset review exist regulation also set interagency committee help regulatory agency review economic effect major regulation sure cost propose regulation fully consider way able identify least costly mean achieve regulatory goal paperwork reduction 1977 administration decrease 12 paperwork burden government imposes people do eliminate consolidate simplify decrease frequency report saving equivalent worker fill federal form full year department agency currently set goal substantial reduction 1978 reporting requirement associate program subject sunset review end unless find necessary addition review recommendation commission federal paperwork labor law reform last year propose legislation reform nation labor law order streamline conduct election employee representation strengthen enforcement power national labor relation board work closely congress ensure early passage bill one high legislative goal year election reform last year support proposal make election fair honest include public financing congressional campaign amendments federal election campaign act election reform administration continue support congressional action measure consumer reform take many action benefit consumer reduce cost improve quality safety product one consumer initiative merit separate creation office consumer representation support legislation last year create office interest consumer could represent one government agency office would require additional government employee expenditure since would merely consolidate consumer office already exist throughout government strongly commit legislation regard enactment one year primary legislative priority public broadcast reform propose legislation last year strengthen public broadcasting service provide increased federal support insulation political pressure good coordination among national organization run public broadcasting opportunity citizen participate local level administration work congress year pas reform openness integrity one primary goal make certain government ethical standard high fully observe must ensure government open responsive american people last year take step direction require senior official administration publicly disclose income asset pledge business agency two year leave government service increase government openness take step make certain well letter freedom information act observe tried bring presidency people citizen forums discussion panel throughout country year continue effort concentrate primary attention area lobby reform administration press legislation require registration lobbyist thorough public disclosure lobbying activity legislation help reestablish confidence trust government ethic applaud strong ethical code adopt last year house senate believe cod standard establish administration official make law clearly apply public official future urge congress pass public official integrity act year classification complete study classification system government document shortly issue executive order design eliminate improper unnecessary classification ensure document declassify rapidly justice civil right equal opportunity americans fundamental civil right require government must afford equal opportunity participate full member society 1977 principle guide administration numerous area plan make certain year effort behalf civil right equal opportunity continue unabated nation concern human right must hear clearly home abroad educational opportunity 1977 administration vigorously attack educational discrimination elementary secondary high education level major suit pursue ensure university level time recognize reaffirmed importance affirmative action program ensure equal opportunity educational institution brief bakke case effort eliminate discrimination promote affirmative action program rely flexible goal rather quota continue full force handicap hew issue regulation guideline implement legislation guarantee equal access program receive financial assistance hew year cabinet department issue similar regulation right handicap american begin fully observe provide 50 million loan fund state institution enable comply regulation eliminate barrier prevent access handicap citizen federally assisted program activity propose major increase fund education handicap child act equal opportunity past year administration reaffirm executive order 11375 prohibits discrimination basis sex federal employment addition voluntarily place executive office president title vii civil right act year part effort eliminate sex discrimination unemployment education continue urge ratification equal right amendment constitution past year equal employment opportunity commission reorganize increase efficiency result commission make substantial progress reduce backlog complaint 40 increase funding proposed 1979 budget eeoc able reduce backlog early year propose congress reorganization plan concern equal opportunity enforcement strengthen eeoc boycott strongly support signed legislation prohibit american participation secondary economic boycott foreign country law strictly enforce administration year regulation issue department commerce minority business last year start number program make opportunity available business effort continue strengthened year half way toward two year goal 2 billion federal purchase service good firm reach goal end year raise goal federal deposit bank 1977 level 100 billion continue enforce 400 million minority business provision local public work act may exceed target continue implement minority business policy establish contract let east corridor railroad improvement program undocumented alien last year propose legislation impose sanction employer hire undocumented alien change legal status many undocumented alien reside country legislation would afford undocumented alien reside continuously since 1970 opportunity apply permanent resident status would create new temporary resident status undocumented alien reside continuously 1970 january 1 1977 want work congress year toward passage undocumented alien bill social economic problem longer ignore native american administration act consistently uphold trusteeship responsibility native american also elevate post commissioner indian affair level assistant secretary interior 1978 administration review federal native american policy step effort help indian tribe assess manage natural resource legal judicial reform last year administration begin number major effort improve nation legal judicial system intend pursue relate effort fully year criminal code reform work closely member congress develop propose revision nation criminal code revision codify one part code federal crime law reform many outdated inconsistent criminal law administration work closely congress year seek passage first complete codification nation criminal law judicial reform federal judicial system suffer many year inadequate number judge continue work congress omnibus judgeship bill correct problem also continue effort use judge effectively legislation propose expand significantly authority magistrate increase use arbitration tighten federal jurisdiction work year complete congressional action bill wiretap reform last year propose legislation reform approach electronic surveillance foreign intelligence purpose afford great protection citizen essentially legislation would require government obtain court order begin foreign intelligence wiretap country administration support early passage much need legislation enforcement competition nation law must vigorously enforce therefore recently establish presidential commission review federal enforcement make recommendation year last year initiate new program administer department justice provide grant fund state attorney general order strengthen enforcement state level expect see result program year reduce government regulation increase competition thereby low consumer cost year continue deregulatory effort legislative administrative area order reduce practice abuse crime reduction criminal justice past year reorganization project justice department develop proposal reorganize improve nation criminal justice system order strengthen enforcement ensure equal justice year send message congress criminal justice crime reduction message include proposal federal law enforcement assistance administration criminal research effort well law enforcement method organize crime white collar crime drug abuse public corruption minimum standard federal correctional institution fbi intelligence agency charter plan issue comprehensive executive order govern intelligence activity fbi cia nsa defense department executive order basis administration recommendation legislative charter govern activity fbi various intelligence agency privacy privacy protection study committee recently propose extensive list new legislative regulatory safeguard administration analyze recent proposal develop year program ensure personal privacy adequately protect district columbia propose last year series reform include full voting representation congress design give resident district significantly great control local affair administration continue work passage reform year develop protect natural resource energy national energy policy april 1977 propose nation comprehensive national energy policy policy base three principle continue guide progress 1978 must learn use energy efficiently carefully conservation measure include retrofit building factory home must shift oil natural gas become scarce coal renewable source energy abundance must provide fair price producer energy encourage development new supply without permit windfall profit debate comprehensive policy long arduous number difficult contentious issue remain settled confident however congress recognize seriousness energy problem act expeditiously program early year secure passage acceptable energy fair consumer provide need energy saving prudent fiscal budgetary continue high urgent national priority 1978 energy statute action already begin lay strong foundation implementation national energy policy 1977 take step put place important policy structural reform need meet energy goal new department energy combine first time major governmental function energy research regulation pricing policy information collection dissemination overall policy development without strong organization would hope implement comprehensive national policy approve propose route pipeline bring natural gas north slope alaska low 48 state emergency natural gas act cope hardship last winter freeze assure high priority gas user cut supply emergency 4 billion store first 500 million barrel oil strategic petroleum reserve already begin fill reserve remain committed 1 billion barrel strategic reserve 1985 outer continental shelf legislation legislation improve management outer continental shelf oil gas development major item unfinished business pending congress prompt passage necessary benefit new law move open offshore area development production bill mandate reform lease program provide necessary development offshore oil gas enhance competition among oil company assure public receives fair return sale public oil gas resource protect marine coastal resource nuclear energy united state also advance policy prevent proliferation nuclear weapon around world international nuclear fuel cycle evaluation establish wide international participation examine alternative exist technology addition legislation propose last year establish good control export nuclear fuel technology work congress secure passage legislation early 1978 commitment prevent spread nuclear weapon lead u reorient domestic nuclear policy defer indefinitely commercial reprocess spent nuclear fuel plutonium recycle clinch river plant would waste 2 billion teach u little already know learn exist nuclear research development program recommend clinch river breeder project stop represent premature unwise commitment commercialization technology need however intend continue develop nuclear energy nation need continue move forward major research program breeder technology begin implement program government management spend fuel nuclear reactor 1978 administration work towards policy safe permanent disposal nuclear waste 1978 beyond carry vigorous nuclear research development program design give u safe technology reduce danger nuclear proliferation environmentally responsible also seek improve current system license nuclear power reactor order cut bureaucratic delay firmly maintain strengthen health safety environmental requirement propose nuclear licensing legislation congress year environment one deep personal commitment clean healthy environment citizen last may outline administration environmental priority policy comprehensive environmental message work closely congress make good progress many measure contain message continue guide administrative legislative action 1978 overall environmental outlay 10 provide new staff resource necessary ensure nation environmental law obey best way enforce landmark environmental statute enact 1977 take consideration science public policy account several important initiative include national heritage program designation national interest land alaska manage precious natural resource well preserve heritage environmental statute 1977 work closely congress enact three significant environmental statute recent year surface mine control reclamation act establishes joint program make sure use economically environmentally sound practice also set fund reclaim land ravage uncontrolled careless mining provide clear stable policy direction operator clean air act amendment establish strict achievable standard auto emission ensure continue progress reduce pollution stationary air pollution source clean water act authorize many important water cleanup program protect nation wetland without unnecessary federal requirement act also reform sewage treatment construction grant program give strong emphasis control toxic chemical environment provide leadership funding necessary carry new law water policy 1977 effort begin ensure federal program policy provide sound fair management limit valuable water resource begin complete review federal water policy complete year close consultation congress state public propose measure need carry recommendation study also continue strong dam safety inspection program initiate late last year make sure dam public private safe alaska land last year send congress proposal use federal land alaska proposal protect 92 million acre public create expand 13 national park reserve 13 national wildlife refuge confer wild scenic river status 33 waterway hope congress adopt measure need year preserve unique natural treasure alaska time permit orderly development alaskan resource redwood national park redwood national park contain nation large old tree last year protect tree destruction commercial logging edge park legislation propose expand boundaries press congressional action bill 1978 national heritage program shortly propose program preserve unique element natural cultural heritage program model successful one several state administer department interior although many necessary step take administratively seek new legislative authority 1978 federal compliance environmental law administration commit principle federal government must set good example compliance environmental law regulation establish private sector far unfortunately federal record find want 1979 budget include money bring federal facility compliance exist environmental law regulation federal reclamation 1977 begin thorough review 1902 reclamation act study complete reviewed year propose congress change need modernize law mining law reform last year administration propose legislation replace archaic 1872 mining law modern lease system mineral resource 1872 system result withdrawal large area land mineral exploration tool environmental protection administration proposal would establish balanced system public interest mineral development environmental protection revenue treasury accomplish special provision would minimize burden small operator provide incentive exploration oil spill last year propose congress legislation would establish strict liability standard oil tanker spill would improve regulation aim preventing future oil spill legislation still need science technology health american science technology creation new knowledge important economic national security ability help solve press national problem area energy environment health natural resource recommend program real growth scientific research step strengthen nation research center encourage new surge technological innovation american industry budget increase 11 basic research lead improve opportunity young scientist engineer upgrade scientific equipment nation research center determine maintain nation leadership role science technology continue america progress field space exploration continue development space shuttle system procurement four shuttle orbiter operation east west coast development spacecraft study first time polar region sun increase outlay demonstration practical application system development space technology foreign affair year ago set five goal united state foreign policy late 1970 early 1980 reassert america moral leadership strengthen traditional tie friends ally work toward international system promote regional reconciliation preserve peace preparedness arm control goal continue underlie agenda 1978 moral leadership past year place american foreign policy new course consistent value high ideal american people try limit worldwide sale arm try prevent nuclear ability make spread country build new relationship develop country promote human right throughout world human right virtually everywhere human right become important country systematically violate real progress united state take credit take lead among western nation belgrade review conference security cooperation europe work closely allies neutral nation ambassador arthur conduct thorough review implementation helsinki final act aspect make clear united state commit full implementation final act area seek review conference two year meanwhile press good implementation helsinki final act must ignore enormous danger pose unrestrained spread nuclear weapon technology recognize benefit commercial nuclear power also must acknowledge risk believe country enjoy benefit risk minimize develop safe technology create new institution manage safeguard phase nuclear fuel cycle meanwhile decide postpone premature commitment technology yet safely manage commercial scale seek persuade others sound economic energy reason likewise arm sale world threaten spiral increase trade conventional arm arm increase likelihood conflict also divert resource human need easy slow spiral begin cut back sale recognition fact world principal seller duty take first step know effort succeed major arm supplier recipient cooperate tie friends ally energy crisis underscored reality interdependence among nation need stable international financial trading system action reflect belief consultation traditional friend dialogue develop nation way united state provide economic political leadership world expect u work ally past year united state restore traditional friend ally center foreign policy within day inauguration vice president visit brussels rome bonn paris reykjavik tokyo meet frequently washington european japanese leader participate economic summit london 1977 nato summit summit leader britain germany france begin 1978 visited france brussels make first visit american president headquarters european community also consult european ally diverse subject salt mbfr middle east africa human right belgrade conference energy nonproliferation global economy relation intensify effort year expand list include close consultation ally major arm control issue may host nato summit washington also plan another economic summit year show dealing japan close ally find solution share problem early year concern nuclear reprocess japan flexibility goodwill side suitable accommodation reach building nuclear reprocessing plant recently reach agreement japanese way deal large current account surplus trade economic talk another example constructive action international economic cooperation work improve extend international economic system strengthen international economic institution ensure international economic competition take place orderly fashion seek improve cooperation among nation imf gatt world bank oecd international organization enable u maintain open liberal trade payment system american economy remain strong competitive position international trade excellent 1977 merchandise export exceed import except oil large amount inflation rate among low industrial world balance trade payment incur large worrisome deficit two main cause 1977 45 billion flow pay import oil wipe would otherwise trade surplus demand foreign good much great demand american good abroad 1977 american gnp increase roughly twice fast real term gnp main trading partner background exchange rate dollar decline relative currency japan germany switzerland european country development lead disorderly condition exchange market december make clear united state would intervene counter disorder do assure integrity dollar must act need healthy grow united state economy adequate investment prudent budget decline inflation make u competitive attractive foreign investor need conserve energy develop alternative source supply reduce dependence import oil cut outflow dollar need see vigorous world economy strong growth particularly country like germany japan switzerland netherland help reduce deficit bring stability international payment factor already work reduce trade deficit economic activity europe elsewhere rise oil import level year effect new exchange rate already occur full effect realize improve trade balance several billion dollar trade payment deficit 1978 large external position show improvement must also augment capacity deal possible strain pressure strengthen international trade monetary system urge congress act promptly approve united state participation imf supplementary financing facility trading nation world engage negotiation reduce barrier improve international trading system reciprocal balance open market freer trade enable u use world resource efficiently contribute economic growth also attempt strengthen rule regulate international trade last 30 year international competition must take place within framework agree rule recognize appropriate fair develop country one critical issue face united state economic political relationship develop country economy become visibly dependent develop world supply market dialogue throughout 1975 1976 united state develop country work group develop nation conference international economic cooperation ciec dialogue reach agreement issue june 1977 remain number unresolved question united state continue consult negotiate develop country question like commodity price stabilization technology common fund international buffer stock pursue dialogue month ahead confident develop nation develop nation agree upon measure let nation participate fully management world economy africa relation africa involve energy human right economic development dialogue maputo lagos conference demonstrate african country discuss difficult problem u mutual advantage relation nigeria improve dramatically administration fy 79 budget substantially increase development assistance africa include continued support african development fund program help african government meet people basic human need growth african regional institution like sahel development fund important african development administration approach latin america caribbean recognize region diversity place great importance protection defense human right halt proliferation nuclear weapon capability restrain conventional arm sale contribute settlement dispute engage latin government global economic negotiation seek senate ratification protocol treaty tlatelolco american convention human right caribbean group try promote regional development intend help several nation develop alternative energy source panama general torrijos sign two panama canal treaty september 9 7 1977 treaty meet legitimate interest panama united state guarantee permanent right protect defend canal contribute importantly regional stability asia united state seek underline desire close relationship develop country asia visit continent regular contact member country association southeast asian nation welcome cooperation asean develop country region japan australia promote regional reconciliation great danger world peace stability war among great power war among small nation past year united state help promote productive negotiation two troubled region middle east southern africa also try settle conflict horn africa cyprus negotiate two panama canal treaty enhance country relation nation latin america middle east effort break rigid approach past bring overall peace settlement look three basic principle normalization political economic cultural relation peace treaty withdrawal armed force occupy territory recognize secure border establishment effective security measure resolution palestinian question significant progress toward peace middle east make last year particularly applaud president sadat courageous initiative reciprocate prime minister begin launch direct negotiation united state continue year encourage party resolve conflict southern africa enter administration inherit problem rhodesia namibia south africa british united state launch new rhodesian discussion last year plan september 1 set forth fair workable principle majority rule transition period lead free election un presence constitution judicially protect bill right zimbabwe development fund contact group unite state participates hold discussion south africa southwest africa people organization interested party internationally acceptable settlement independent namibia majority rule effort produce wide agreement include provision substantial un presence unite state tell south african prime minister unless nation begin progressive transformation toward full political participation people relation suffer support union nation arm embargo south africa prohibit gray area sale begin review south african economic relation horn africa arm supply soviet union fuel side conflict horn africa somalia ethiopia danger soviet union cuba commit soldier conflict transform local war confrontation broad strategic implication deplore fact disagreement region assistance outside bloody conflict make clear side supply arm aggressive purpose recognize forcible change boundary want see fight end party move battlefield negotiate table cyprus hope groundwork laid 1977 permanent settlement cyprus encourage movement direction preserve peace past year administration assess threat ally security well collective strength combat threat seek promote responsible arm control effort reduce competition arm recognize strong defense foundation security make certain defense spending sufficient use maximum effect arm control fundamental purpose arm limitation effort promote national security strengthen international stability thereby enhance prospect peace everywhere try move strategic arm limitation talk toward ambitious objective want reduce contain competition number strategic weapon possess united state soviet union limit qualitative improvement weapon merely raise risk u precisely determination obtain objective negotiation difficult prolong however confident agreement present congress meet also make solid progress toward objective united state pursue many year comprehensive treaty ban nuclear explosion treaty open nation world major step toward reduce reliance weapon toward halt spread world time seek arm limitation agreement soviet union contribute security stability various region world europe nato ally seek mutual balance force reduction agreement achieve great stability balance low level force indian ocean neither soviet union yet deploy military power large scale work agreement prevent major military competition first time begin negotiate soviet union outline treaty ban chemical warfare essential element american security maintenance stability western pacific united state play major role maintain balance power seek readjust military presence korea reduce ground force peninsula undertake compensatory measure ensure adequate balance force remain talk filipino government future military base continue process normalization relation people republic china within framework shanghai communiqué last year seek halt worldwide spread nuclear weapon capacity nearly 40 nation join u effort find nuclear power source readily use build nuclear weapon defense defense budget recommend congress fulfill press defense need request increase defense spending compensate inflation need maintain adequate military balance face continue soviet military effort negotiate soviet strategic arm continue preserve essential equivalence strategic nuclear strength technological advantage soviet union apparent build cruise missile together upgraded assure capability element triad continue develop missile system case need deploy budget requesting fund continue increase trident submarine force important strategic program submarine hard enemy destroy nato ally try improve initial combat capability nato force improve readiness critical combat unit enhance american capability send ground tactical air force reinforcement increase permanent force lay foundation future improvement budget propose request 18 increase procurement equipment army united state take step alone participate mutual effort importance sea force united state national security undisputed navy receives large share defense budget requesting fund continue modernization need examine appropriate size mix united state naval force future therefore deferred spending new aircraft carrier current defense department study complete early year maintain naval strength capability deploy rapidly light effective combat force worldwide necessary without overseas base support end request fund vigorous airlift enhancement program way seek develop foreign policy wider scope foreign policy recognize global diversity foreign policy build stable international system jimmy carter white house january 19 1978