Remarks at the Electronic Industries Association's Government-Industry Dinner
Thank you for that warm welcome. I'm glad Pete was listening. I thought he thought I said a thousand pints of Lite -- [laughter] -- and that's why -- [applause]. I'm delighted to be here, Chairman Little and President McCloskey. And I loved the invocation by Peter's brother. I want to greet the distinguished Members of Congress that are here tonight: I see Jerry Lewis over here and, of course, our distinguished majority leader, Tom Foley; Larry Welch, member of the Joint Chiefs; and, of course, one down from Pete, my colleague in the White House, our head of the National Security Council, Brent Scowcroft. And on my right, affectionately known as the Silver Fox.
I'm speaking before the olives, before the celery, and here's why: This is the most relaxed I've seen Barbara since our dog got pregnant. [Laughter] And we've got to go back to the White House. And I said to her, "Are you coming with me to Texas tomorrow morning?" She said, "No. What do you mean? Millie is expecting." So, you'll excuse us if we hit-and-run here. But I did want to say how pleased I am to be back with the members of the Electronic Industries Association, all you distinguished guests. Thank you, Pete, for the introduction.
Bishop Fulton Sheen once said: "The proud man counts his newspaper clippings; the humble man counts his blessings." Well, I am proud indeed to address this annual dinner. But let me confess: Tonight, flanked by colleagues and friends, and many of you all who I've known over the years, I am more grateful for my blessings.
And let me first congratulate the man with whom Bar and I just met, this year's EIA Medal of Honor recipient, Sid Topol. And I want also to say a word about this organization, the oldest and largest exploring the new horizons of America's technological future. Today, nearly 2 million Americans work in your industry. You're leading America's newest industrial revolution. You're helping us outwork and outperform the competitors around the world. And tonight we meet as neighbors and fellow businessmen, and our goal is a fairer, more productive, and ennobling life, not merely in our time but for the generations to come.
A more ennobling life can mean many things. It means education and opportunity. It means a nation of responsive citizens not only willing but eager to share, and it means the economic development which makes this sharing possible. For prosperity depends on growth, and growth depends on freedom. My friends, the freedom to dare, to risk, to defy the odds forms the heart of free enterprise, just as free enterprise is central to the American dream.
Freedom can give our kids a better land than we ourselves inherited. But to preserve it, we've got to protect it. And that's why I've proposed two major goals for objectives to build a better America: First, reduce that deficit; second, invest in America's future. And to round them out, address the problems of the present; the problems that cannot wait. And last, but not least: No new taxes!
And, yes, America faces immediate problems, problems like ocean dumping, the homeless, illiteracy. And, yes, I pledge to you we will address them now, not somewhere down the line. But as we do, let's move beyond the immediate. For today America is prosperous and at peace. And to be sure, there are enormous challenges, many opportunities presented by changes that are favorable to democracy, to liberty, to free markets, favorable to the principles this country has always stood for. And therefore, let's recognize that we stand at a special moment in our history. It's a moment not for complacency, not to sit back and reflect upon what's been, but to reflect on what might be. And it's an opportunity to look into the future and plan for it so that America's place and the well-being of her people are ensured for generations to come. We must remember the American tradition as we invest for the future of our own children.
My four objectives will allow America to honor that heritage and seize her moment. And together they will solidify economic freedom. They will expand that freedom. But above all, they will empower more people, more fully, to partake of the American dream. Reducing the deficit will free our children from interest debt which haunts their future. Investing in that future will prepare us as a people for a new century and its challenges. Focusing on urgent priorities will free government to marshal its resources. And no new taxes reflects that innately American quality, good old-fashioned common sense. These four objectives will build on the progress of the last 8 years. They will build a better America, and they will reaffirm our strengths, diffuse ticking time bombs, and reorient us as a nation. Above all, they form a new approach which looks to tomorrow, not just to today.
As President, I'm committed to this new approach. And that is why last month I proposed an agenda to cut the Federal deficit; help ensure our financial future; and thus enhance business' ability to plan, expand, and build. And I proposed to cut that deficit not by increasing the tax burden on the American people but by controlling spending and continuing economic growth so that as more people are working, revenues will rise as tax rates remain the same.
Next year alone, thanks to economic growth, Federal tax revenues will rise by more than $80 billion -- more than $80 billion, even with no new taxes. And my plan will use that new revenue to slash the Federal deficit by more than 40 percent, in keeping with the Gramm-Rudman targets, bringing the deficit literally below the target.
And as you know, we've begun the budget process. The administration has acted. And now, in fairness, we are acting in a good bipartisan spirit on Capitol Hill to get action. Our task is to keep the economy going and growing. And only then can we create the investment that's so crucial to America to increase new jobs, to unlock new markets and, yes, to unleash new technologies. In a sense, this is typically American. For we're restless; we're never satisfied. We look to the next week and next year, not to the year 2000. Government's role challenges to harness that ambition by looking beyond a day.
Last year a large survey of CEO's revealed that, while American business leaders are inherently optimistic, they believe -- in this poll by nine to one -- that we're too short-term oriented. My plan speaks to the long-term and to a stable business climate. It says that to remain competitive we've got to look beyond the next quarterly statement. It says yes to America's standard of living and to her standing in the world.
For instance, let me address the investment that will result from cutting the maximum rate on capital gains. My plan supports reducing it to 15 percent on long-held assets. And moreover, it effectively eliminates the capital gains tax on people making less than $20,000. In 1978 this organization, following the leadership of my late departed friend, Bill Steiger, worked to reduce the capital gains tax. Well, today we've got to fight that battle all over again. We need the capital gains tax differential. Restoring the capital gains differential will lift revenues, help savings, and free American businesses without distorting world markets. Consider on the one hand, those competitors who tax capital gains punitively. By punishing risk takers, they stifle opportunity. Less opportunity means less capital to invest. Less capital, in turn, makes countries less competitive. It's a vicious cycle, a bit of a catch-22, and above all, an economic dead end.
On the other hand, keep in mind that some of the most successful economies of the Pacific rim -- Hong Kong, Singapore, Republic of Korea -- exempt capital gains from taxes. And our second biggest trading partner, Japan, scarcely taxed during her meteoric rise. As businessmen, you know this economic history. You know its lessons are clear. And like me, you hear a lot about competitiveness these days. Nothing can make America more competitive than restoring this differential. America's entrepreneurs should not have to run an uphill race against the rest of the world.
Tonight I challenge the Congress to join with me and level that playing field. I ask it to expand the marketplace and assist development. I urge it to increase competitiveness and link reward and risk. And the way you do that, once again, is by lowering the tax rate on capital gains.
My friends, the Treasury estimates that this cut in capital gains -- restoring that differential -- will add $4.8 billion to the revenue side of the ledger in fiscal year 1990. So, let us use it to expand economic freedom and help people help themselves. And let us build upon the over 19 1/2 million new jobs created in this country since November of 1982 -- five times the number created in Japan.
Accordingly, my plan to build a better America recommends a permanent extension of the research and experimentation tax credit. It'll increase domestic research by multinationals and end the uncertainty of expiring temporary rules. And by adopting Federal enterprise zones, it'll help those untouched by the economic recovery. Enterprise zones are a pioneering initiative to create a number of federally targeted zones or areas in these economically distressed communities. By providing tax breaks in the relief from regulation, these zones foster a climate where businesses are founded and existing businesses expanded. Enterprise zones, like lowering the tax on capital gains, will invest in America's future.
And so will other investments. Investments, for instance, in education or the environment, in our children and in space. As a Texan, I know firsthand the role of space exploration. I know of your industry's involvement, your role in its success. My plans allocate an increase of $2.4 billion for the space program. This is as much an investment in our technological future as it is a reaffirmation of our national character. It supports affordable access to space through the National Aero-Space Plane Program and nine space shuttle flights by 1990. It funds space station Freedom, planned for operation in the mid-1990's. And I'll also elevate the status of the President's Science Adviser.
You cannot look into the next century without emphasizing the importance of science. All the unexplored frontiers are not in space. Many are found closer to home, as we seek to push back the frontiers of human knowledge. Toward that end, let us invest in the superconducting supercollider -- a bold new experiment fusing science, technology, and education. And let us expand the work which will leverage America's technological prowess in such areas as microcomputers and automative electronics, bioprocessing, and then this high-definition TV. And because science is critical, as I have said, I intend to double the National Science Foundation budget. These investments are not some riverboat gamble in a distant future but a steadfast way to ensure the future.
And yet, my friends, remember that future is going to depend above all on our most precious resource -- America's children. We've got to make sure that the kids are educated, the very definition of long-term investment in America's future. And that's why I want Congress to create a $500 million program to award merit schools. I intend to create special Presidential awards in every State. I urge expanded use of magnet schools, giving parents and students freedom of choice. And I propose a program to spur alternative certification, allowing talented Americans from every field, especially science and math, to teach in America's classrooms. It is simply a shame that the brightest among you men and women here tonight, coming out of science, wanting to give of yourselves to teach the kids, couldn't qualify because you didn't have the required number of formal education degrees. It is time we take a new look and permit those who want to give of themselves to teach in our public schools.
And you can't talk about a better America without worrying about the dangers of drugs. We propose the YES program, or Youth Entering Service, to involve our kids in the communities. My friends, our children can make the 21st century a new American century. So, let's help them, guide them. And let us understand that we are one community -- proud, united, and unafraid of the future.
A quote is attributed to Albert Einstein saying: "Everything that is really great and inspiring is created by individuals who labor in freedom." For more than 200 years, Americans have invested their labor, their talent, their compassion, and their vision to preserve freedom, to seize the moment and sustain our way of life. And I ask you, with America's tomorrow at stake, can we do anything less today?
God bless you all. Thank you very much for letting Barbara and me come to this outstanding dinner. We are very grateful to you. And God bless the United States of America. Thank you very much.
Note: The President spoke at 8:16 p.m. in the Grand Ballroom at the J.W. Marriott Hotel. He was introduced by Peter F. McCloskey, president of the association. Rev. Joseph M. McCloskey delivered the invocation. In his remarks, the President referred to William G. Little, chairman of the board of the association; Representative Jerry Lewis of California; and the late Representative William A. Steiger of Wisconsin.
George Bush, Remarks at the Electronic Industries Association's Government-Industry Dinner Online by Gerhard Peters and John T. Woolley, The American Presidency Project https://www.presidency.ucsb.edu/node/248684