Statement About the Nation's Economy

NOWHERE in the United States does the goal of a new prosperity--full employment without inflation and without war-mean more than here in California, America's largest State and one whose economy, as a State, actually ranks ahead of all but a few of the nations of the world. Californians can take satisfaction in our steady progress toward the new prosperity-progress in which they share fully.

One of the best measures of our robust national economic health is the fact that the growth rate of our total goods and services produced (gross national product) --9.4 percent per annum in the second quarter of this year leads the world today. Employment is at an all-time high, with 82 million workers now on the job, 9.6 million more than a year ago. The rate of inflation has been cut from 4.4 percent a year ago to only 2.9 percent today.

Most important, as a result of these gains, the real wage of the average American worker has finally climbed off the inflationary treadmill of the 1960's, registering a gain of more than 4 percent in the past year alone. This means $200 in new purchasing power for the average wage earner--the equivalent of two extra weekly paychecks in a year.

Since 1969, we have succeeded in moving the U.S. economy from a wartime to a peacetime basis with a minimum of disruption. The rate of unemployment, while still too high, continues to move downward.

In California, for example, unemployment has declined statewide from 7.1 percent in August 1971, to 5.8 percent in August 1972. Here in Los Angeles, the progress against unemployment has been even more marked from 6.9 percent in August 1971, to 5.5 percent in August 1972. This has meant an increase of 63,000 jobs in Los Angeles alone in one year. And the job situation in Los Angeles should continue to grow stronger, provided that the Nation continues on the path of sound economic policies, with our defense maintained at realistic and effective levels.

California has become one of the world's great research centers. Future economic growth in this country, with more and better jobs, requires that the United States strengthen its research and technological capacities. This is one reason why this Administration's budgets in the past 3 years have greatly increased the allocation of Federal funds to research and development. My budget for fiscal year 1973, for example, recommended an increase of more than $1 billion for research and development in the Department of Defense budget alone. The National Aeronautics and Space Administration and the Atomic Energy Commission have intensified their efforts to utilize the technological advancements developed under their programs. Overall, there has been a 65-percent increase since 1969 in R & D investment for all purposes other than defense and space. These obligations amount to $5.4 billion in 1973.

The new economic policy which I initiated in August 1971 has played a role in the achievement of America's heartening economic resurgence.

But the real driving force has been the talents and the energies of America's workers--the millions who seek nothing more from their Government than a favorable economic climate for their job skills, unmatched now or at any other time by any other society.

These are the people who know that the economic greatness of America was built by the incentives and rewards of work, and who believe that it is a continued dedication to work and earnings that will keep America great.

The goal of my Administration is not more welfare, but more work--more dignity, more self-respect, more opportunity. We have fought for 3 years to reform the welfare mess without help from those who now seem to point to it with confused criticism.

We say the Government should set policies which tax the working man and woman at a minimum, protect their purchasing power at a maximum, and ensure job access for everyone. Only then can every American raise his family's living standard to the highest point his skills and dedication will permit.