Toast at the State Dinner in Budapest

Well, thank you, sir, for those very warm words of welcome. And I'm delighted to have this opportunity to visit Hungary once again, to see firsthand the remarkable changes taking place here.

We live at a great moment in human affairs, an era when change is shaking the existing order. From Beijing to Budapest, from Tiananmen Square to the long delayed day of healing in Heroes Square less than a month ago, we're witnessing the expression of democratic idea whose appeal is universal, whose impact is worldwide. And here in the heart of central Europe, Hungary is at the center of change. Your nation is involved in an unprecedented experiment: a Communist system seeking to evolve towards a more open economy, towards a more open and pluralistic political system.

No one now denies that reform is the path of the future. In nation after nation, decades of experience have proven beyond any doubt the poverty of an idea: the idea that progress is the product of the state. On the contrary, progress is the product of the people. And state control simply cannot provide sustained economic growth, nor can it provide a regime the political legitimacy it needs to govern. Most of all, the state is in constant conflict with human liberty.

In Hungary today, there is a deepening consensus on the direction that reform must take, on a new model for state and society: in economics, the competitive market; in politics, pluralism and human rights.

The key to economic success is letting the market do its work, and that means an end to inefficient government intervention in the marketplace, an end to the dead weight that drags down overall economic growth. It means factories and enterprises of all kinds playing by the rules of the marketplace, according to the laws of supply and demand -- in other words, rules that work for the individual and the common good.

And economic competition has a parallel in the political sphere. Pluralism is nothing more than an open and honest competition between parties, a competition between points of view. Pluralism is what we in the West call the marketplace of ideas. The open elections that Hungary has promised will mark a great advance and allow your great nation to enjoy the benefits of pluralism. The hopeful process of Helsinki points the way to the enhancement of freedom in central Europe, to a new basis for security and cooperation in all of Europe.

All Hungarians should look to the future with confidence in what Hungary can be. This is only the beginning. I see in Hungary's future a country of hundreds of thousands of small enterprises -- sources of innovation, productivity, and prosperity. And I see in Hungary's future new voices speaking out, shaping the course of national affairs. I see a Hungary at peace with itself, a Hungary assuming its rightful place as a vital part of an emerging Europe -- a Europe whole and free.

The road ahead will be difficult. There's no denying that. But I believe in Hungary; I believe in her ability to meet and master the challenge: to make reform succeed. The key is Hungary's most precious resource -- her people. Each individual is an infinity of possibilities, and in the capacity of those individual talents lies the future of your nation. So, now let us raise our glasses: To the future of Hungarian reform; to the friendship, the genuine friendship, between the American and the Hungarian people. And thank you for this warm welcome.