Address to an Audience of Small Businessmen and Women in Birmingham, Alabama
This morning, I particularly want to talk about a subject that's important to me. And that is the small businessman in our nation. It is an extremely great honor for me to have John Sparkman here with us—a great Senator, a great leader, a candidate of our own party in 1952 for Vice President, and this man has also, as you know, been a leader in the Senate, as a chairman of the Small Business Committee. He's now gone to the Foreign Affairs Committee, but his leadership in this field makes it extremely valuable for me to have him on the platform with me.
We haven't had a fanner in the White House since Thomas Jefferson. We haven't had a small businessman in the White House since Hany Truman. And so we're going to bring a lot of good things to the White House after this election.
I think it's good to point out my own background—very briefly—to lay the groundwork for my credentials in speaking on this subject
I came home from the Navy in the winter of 1953. I moved into the government housing project to live. I started a small business, a continuation of what my father had done selling fertilizer. We reorganized, and my mother and I became partners together. The first year was 1954. Those of you who are farmers remember 1954. It was the worst drought year the South has ever seen in recorded history. We had a crop failure. And although I sold about 3,000 tons of fertilizer, and should have made about $9,000 gross profit, my profit was less than $300. I didn't make enough money to pay my house rent in the government housing project
The next year my wife went to work. That made two of us in the business. In the third year, I hired my first employee. But I had to struggle then, as a professional Naval officer, to learn about accounts receivable, to learn about balancing budgets, to learn about payroll, and to learn about government red tape and paperwork which at that time was practically nothing compared to what it is now.
In a few years, I was still struggling. And I went to the Small Business Administration for a loan to build an office building which I needed, and to build a cotton gin, and to make an investment in better handling equipment for peanuts. And at that time I was proud of the Small Business Administration. It was honest; it was open; it was well oiganized; it had a very close, very intimate relationship with the private lending institutions of our area. I believe that 90 percent of my loan came from the local bank. But the SBA guaranteed the loan and put up 10 percent of the money.
Later, year by year, top business executives, on a volunteer basis, would come down to Plains, and they would go through Carter's warehouse. I opened my books to them. And they said, "Jimmy, this is something I think you'd better watch. Here's an area where you can save money. This is something that you ought to quit doing."
And I felt that I had a partnership between those who knew about business and those who were willing to lend me the money and myself as an embryonic businessman. That's all changed now.
We don't have a Small Business Administration of which we can be truly proud. In the last few years we've had I don't know how many indictments and twenty convictions in the Small Business Administration. And the organizational structure of the agency is deteriorated along with a lot of other aspects of government.
This Republican Administration has given us a lot of new things. The first $200 billion budget. The first $300 billion budget. The first $400 billion budget. We're now spending over a billion dollars a day, and our deficit is a billion dollars a week.
In the last eight years we've seen the number of bankruptcies more than double. From 15,000 in 1969 to over 30,000 this past year. We've seen interest rates go up 50 percent. We've seen unemployment go up more than 100 percent. We've seen the deficits, the unbalanced budgets, increase grossly. Harry Truman for 7 years had an average surplus over $2 billion. Johnson/Kennedy (including the deficit of the Vietnam War) had an average deficit of less than $7 billion. Under Nixon and Ford, this Republican Administration, the average deficit has been more than $24 billion a year. And the last two deficits, recommended by the President, have averaged over $50 billion a year. This, as I said earlier, is a billion dollars every week. We go further in debt. This is the kind of improper management that really grates on the consciousness of a businessman.
Now my professional training is in engineering, science, my career training has been in planning, in managing a business, in running a farm. I produce certified seed on my farm—mostly peanuts. And I process peanuts now, starting this past year, for the market. I know what it means to meet a payroll. I know what it means not to waste my own money. I know what it means to have balanced budgets. I know what it means as a governor not to waste the taxpayers' money.
I have never known an unbalanced budget—in my business, on my farm, as Governor of Georgia. And I've set a goal for myself, which I intend to meet: that before my administration is over, the budget of the United States will be balanced.
I've learned some other things. Whenever there is a choice between government performing functions, and the private sector performing the functions, I believe in the private sector having the responsibility. Whenever there is a choice between the federal government doing something or the state and local governments doing the same function, I believe it's best to place the responsibility and the authority as near as possible to the individual private citizen.
I believe in a maximum openness in government My government is your government And whenever it is wrapped in secrecy, and the people are excluded from the process of making decisions, that's when we make our serious mistakes in foreign affairs, as Senator Sparkman so well knows, and in domestic affairs. You can go back the last number of years, whenever we've had a serious mistake, it has been because the American people have not been part of the process of making the decisions and carrying them out So maximum openness in government and a maximum personal privacy of our citizens is a good commitment to which we need to return. We need to have confidence in ourselves. Our nation's strong—economically—strongest nation on earth. Richard Nixon didn't hurt our system of government Watergate didn't hurt our system of government. The Vietnamese-Cambodian war didn't hurt our system of government. The CIA revelations haven't hurt our system of government Even the gross mismanagement of programs like the Medicaid and SBA programs haven't hurt our system erf government It's still a basis on which we can predicate answers to complicated questions, bind ourselves together and face the future with confidence. We ought to remember that The greatest thing which we have and which we can depend on in the future is the American people. We still have within us the same intelligence, the same ability, the same patriotism, the same of brotherhood, the same commitment to the work ethic, the same belief in personal freedom, the same high moral character that we've always had.
And that's a tremendous resource that's waiting to be tapped. And next January, it's going to be tapped again. And you can depend on that.
Now what can we do specifically to help small businessmen and women? We've got a lot more women in this country who have now decided to go into their own professional careers. In not just education, but in medicine, law, and also in business. So what can we do to help diem? First of all, we need to have more private investment participation in loans for the new starting business. This has gone backwards in recent years. We need to have more equity capital and not debt financing. The trend here has been absolutely terrible. We've gone more and more to a debt financing of business establishments and business expansion instead of letting business finance their own improvements with equity. We need to have more top business executives volunteer to work in government. Now when I was elected governor, we reorganized the structure of government We put in good electronic data processing, good personnel management, good transportation systems. We cut down red tape, eliminated paperwork as much as we could. And the ones on whom I called to help me with that were the top business executives. I have told you already how they came into my own small business in Plains to give me advice. That's an important resource that our country ought to tap.
I might add one other thing. It's not fair to blame the business community for the mistakes that government makes. The business community is as honest as any farmer or any preacher, if we can understand that the government treats us fairly. Now if there is an excusing by government of the violation of the law of business, quite often this grows on itself. It ought to be competitive. If business becomes involved in illegalities, and improprieties of government, but business is basically honest, more so than they're given credit for and one thing a President can do is to help restore the stature and the approval and the public support and the confidence in the business community.
It's a cheap shot when elected public officials blame the business community for the economic, social and political problems of our country.
Another thing that we must do is to increase the chance for small businesses to compete for government contracts. The Republican Administration has paid lip service to small businesses and big service to big businesses, and that's got to be changed too in the next administration.
We need to increase the opportunity for sales of products produced in small business. Most very large businesses have their own built-in organization—legal staff, lobbyists, overseas sales mechanisms and outlets. But small businesspersons, like myself—I'm sure most of you are bigger than I am in business—have a very difficult time understanding how to sell our products overseas. It's a tremendous market. We now export, for instance, in agriculture alone, $24 billion of our products every year. When I was Governor of Georgia, I joined in a hot competition with Governor Wallace and Governor West in South Carolina and Governor Askew in Florida because in the Southeast, one of the major responsibilities on the shoulders of a governor is to increase job opportunities by bringing in new industry and by selling the products we produce. While I was governor, we established and we maintained trade offices all over the world. We now have full-time trade offices just for Georgia, in places like Sao Paulo, Brazil; Toronto, Canada; Bonn, Germany; Brussels, Belgium; two in Japan, Great Britain, and so forth. Just to have a focal point in foreign countries so that a business person large or small can make arrangements there to make a trip to Great Britain or a trip to Common Market countries or a trip to South America, or a trip to Japan, and have the arrangements made to meet with the top leaders to sell products there and to get increased investments in our state.
When I went to these foreign countries, like for instance Brazil, a tremendous potential market for our products, there would be hot competition. The Japanese, the Germans, the Chinese and small places like Bulgaria, the French and others would be there. And they would have government, business, labor, and agriculture representatives in a trade mission and they would sit down with the leaden in Brazil and say, this is the product we have to offer, this is the delivery date that we can meet, this is the quality of our products, this is the cost of them, this is the interest rate we'll chaige, this is the repayment schedule. And if they could offer a good package, they'd sign a contract right there. I went down with business and labor and agriculture leaders of Georgia. And when I tried to get an answer from Washington, on a specific trade deal, I never could find which department to go to. It's absolutely impossible. Is it Agriculture? Is it Commerce? Is it Treasury? Is it State? Is it Defense? Nobody knows. We need to have the same kind of commitment to overseas trade to put our people back to work on a nationwide basis as the southern states have done in the last number of yean to overcome the aftermath of the war between the states a hundred yean ago.
The world is waiting for good, top quality products that our nation can produce. But quite often they wait in vain because of the bureaucratic mess that we have in Washington, and that needs to be straightened out as well.
I just want to mention a couple of other things that are specific. We need to have tough enforcement of the antitrust laws. Our system of private enterprise must be preserved. And when the government does anything to lessen competition it hurts us all. It hurts the small businessman, it hurts big business, and particularly it hurts consumers. Tough enforcement of the antitrust laws is mandatory. Now the Republican Administration has stood in the way of the enforcement Mr. McLaren, under President Nixon, resigned, and recently the top Assistant Attorney General under this administration has also quit in disgust because of a lack of enforcement or commitment to tighter antitrust policies that have been proposed to the Congress. We need to break up the sweetheart arrangement between regulatory agencies and industries being regulated. Regulation on business is almost unbelievable. In 1975 alone, the 82 regulatory agencies in Washington put out 45,000 pages of regulations. Now a big business organization can take care of that perhaps because they can have a superb full-time CPA staff and secretarial pools and attorneys. But a small businessman can't deal with those regulations, without a great deal of hardship and many obstacles placed in his or her way to success. The tax laws are a disgrace to the human race, and they have got to be reformed completely to give us a fair deal from our own government. Quite often businesses will take an action that's contrary to their long terms best interest just to get a one year's credit under the tax laws. I happen to be mainly a farmer and in the processing of farm products. But a very wealthy dweller—a lawyer, a doctor and so forth— who wants to have a deliberate loss to benefit from tax shelters can come in and buy the farm next to mine, deliberately lose the investment, make a great deal of profit off of it, and provide unwanted competition with the rest of us. As you know, the same thing applies under the tax shelter programs, in the area of oil drilling, or any other aspect of our lives. So the tax program has got to be revised to remove this unwanted intrusion into the business community, and the decision making process.
We also need tough, competent, business like management of the government itself. We now have over 2,900 agencies, departments, bureaus, and commissions in Washington. They need to be cut back drastically to make sure we eliminate confusion, overlapping and waste. We need to install also zero-based budgeting which means that every year you reassess every program in the executive budget. You eliminate obsolete programs, you reveal and eliminate overlapping in the agencies, and you establish priorities that spend your next year's money where the money's needed to be spent next year—not where it was supposed to be spent 50 years ago. And we need a sunset law to review every major department, regulatory agencies included, at least every five years—initiated by the Senate and the House. So zero-based budgeting, tough competent management, sunset laws by the Congress, will help weed out those obsolescent agencies that create most of the unnecessary paperwork and red tape. That's going to come next year, as well.
The last point I want to mention is this. We need to have more cooperation among the different entities in our society. Between governments at all levels—business, industry, labor, agriculture, education and science, and others. There is no way now to tell what the government is going to do next. I don't favor the government planning for the private sector in our society. But the government ought to let us know what the government is going to do next so that we can make our plans accordingly. Now, I need to know 15 months ahead of time what agriculture policies are going to be in existence—on acreage allotments, target prices, reserve supplies, exports, imports, I don't have the slightest idea what Mr. Butz is going to do next. That's typical of the kind of administration we've got in Washington, and although I've got a lot of priorities when I get to the White House, I think the first one is going to be to send Mr. Butz back where he came from and have a good agriculture policy. So farmers and the business people of our country don't want a handout. We believe in work. We don't believe in welfare. We want to be sure we have a competitive area in which to operate.
We don't want special favors. We want some predictability about it. We do not want to have the rug pulled out from under our feet after we make a commitment that can't be reversed. Now cooperation ought to extend between the White House and the Congress. I believe that I can cooperate as President with Democratic and Republican congressional leaders. This has been done in the past. There's a constitutional delineation of responsibility. It's time for the White House and the Congress to cooperate for a change, with mutual respect for a change. I know that the Congress is inherently incapable of leadership. You can't expect 535 different people to lead this country. Our founding fathers never thought that that would happen. No matter how strong the individual Members of Congress are, there's only one person that can speak with a clear voice to the American people. There's only one person that can set a standard of ethics and morality and commitment. There's only one person that can call on the American people to make a sacrifice when necessary and explain the purpose of that sacrifice. There's only one person that can answer complicated questions or propose bold programs to deal with our needs. There's only one person that can insure cooperation and unity within our complicated nation. There's only one person that can harness the tremendous resources of our country to support a strong defense and understandable foreign policy.
And that person is the President In our absence of that leadership, there is no leadership. We have no leadership now. Our country is drifting. I can't recall a single thing that our incumbent President has done in the two year period that indicates a capability for leadership.
Our nation cries out for clear statements of where we are, and where we hope to be. And this depends upon a close relationship between the White House and Congress, but also between the President and the people. Now I've run my campaign that way all my political life. I started out 21 months ago without any built-in organization, I didn't have very much money; I came from the small town of Plains, not a major media center. Plains was not a major media center at that time—I didn't hold public office, not many people knew who I was. But I and my family and a few other supporters began going from one front living room to another, only 4 or 5 people would come in, and from one labor hall to another. Maybe 10 or 12 people would come. We went to farmers markets, to livestock sale bams, county court houses, city halls, shopping centers, factory shift lines, barbershops, beauty parlors, restaurants, shaking hands, talking a little bit, listening more. And we built up an organizational structure quite often with people who had never been before involved in politics. It's a close relationship between me and the people of our nation.
And I feel secure in my political campaign and even with the prospect of the awesome responsibility of President, because of that relationship with the people. I don't know all the answers. I'm just an average American like you. I got involved in politics almost by accident. But I enjoy the public service.
But I believe the fact that I have been an engineer, and a scientist, and a farmer, and a businessman, and a local school board member, state senator, a. governor, and have campaigned throughout the country, will stand me in good stead if I get to the White House.
But the greatest source of confidence and strength that I have is the fact that the people with their experience and intelligence, with their commitment to our country, with their high moral character, is where I get my support, and my advice, and my counsel, and my criticism. If I can keep that close relationship, and tap that tremendous resource—it's what our nation is—then I think I can have a good administration next year.
I owe special interests nothing. I owe the people everything. And I'm going to keep it that way. If you think it's time for a change in Washington, I hope you'll help me. I think it's time for a change for the better.
Thank you very much.
Jimmy Carter, Address to an Audience of Small Businessmen and Women in Birmingham, Alabama Online by Gerhard Peters and John T. Woolley, The American Presidency Project https://www.presidency.ucsb.edu/node/347665