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Mr. President, Mr. Speaker, members of the United States Congress, I return as a former

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President of the Senate and a former member of this great House. And now, as

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President, it is my privilege to report to you on the State of the Union. Tonight, I

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come not to speak about the state of the government, not to detail every new

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initiative we planned for the coming year, nor describe every line in the

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budget. I'm here to speak to you and to the American people about the state of

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the Union about our world, the changes we've seen, the challenges we face, and

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what that means for America. There are singular moments in history, dates that

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divide all that goes before from all that comes after, and many of us in this

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chamber have lived much of our lives in a world whose fundamental features were

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were defined in 1945.

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And the events of that year decreed the shape of nations,

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the pace of progress, freedom or oppression

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for millions of people around the world.

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1945 provided the common frame of reference,

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the compass points of the post-war era

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we've relied upon to understand ourselves.

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And that was our world until now.

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The events of the year just ended.

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The revolution of 89 had been a chain reaction, changes

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so striking that it marks the beginning of a new era

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in the world's affairs.

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Think back.

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Think back just 12 short months ago

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to the world we knew as 1989 began.

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One year, one year ago, the people of Panama lived in fear under the thumb of a dictator.

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Today, democracy is restored. Panama is free.

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Operation Just Cause has achieved its objective, and the number of military personnel in Panama

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is now very close to what it was before the operation began.

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And tonight I am announcing that well before the end of February, the additional numbers

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of American troops, the brave men and women of our armed forces who made this mission

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a success, will be back home.

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A year ago in Poland, Lachawentza declared that he was ready to open a dialogue with

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with the communist rulers of that country.

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And today, with the future of a free Poland in their own hands,

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members of Solidarity lead the Polish government.

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And a year ago,

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the freedoms playwright,

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Václav Havel,

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languished as a prisoner in Prague.

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And today, it's Václav Havel, president of Czechoslovakia.

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And one year ago, Eric Honaker of East Germany claimed history as his guide,

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and he predicted the Berlin Wall would last another hundred years.

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And today, less than one year later, it's the wall that's history.

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Remarkable events.

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Remarkable events.

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Events that fulfill the long-held hopes of the American people.

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Events that validate the long-standing goals of American policy,

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a policy based on a single shining principle, the cause of freedom.

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America, not just the nation, but an idea, alive in the minds of people everywhere.

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As this new world takes shape, America stands at the center of a widening circle of freedom,

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today, tomorrow, and into the next century.

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Our nation is the enduring dream of every immigrant who ever set foot on these shores

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and the millions still struggling to be free.

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This nation, this idea called America,

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was and always will be a new world, our new world.

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At a workers' rally in a place called Brani,

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on the outskirts of Prague,

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the idea called America is alive.

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A worker, dressed in grimy overalls,

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rises to speak at the factory gates,

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And he begins his speech to his fellow citizens with these words, words of a distant revolution.

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We hold these truths to be self-evident, that all men are created equal, that they are endowed by their creator with certain unalienable rights, and that among these are life, liberty, and the pursuit of happiness.

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It's no secret that here at home, freedom's door opened long ago.

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The cornerstones of this free society have already been set in place.

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Democracy, competition, opportunity, private investment, stewardship, and of course, leadership.

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And our challenge today is to take this democratic system of ours, a system second to none, and

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make it better.

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a better America, where there's a job for everyone who wants one,

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where women working outside the home can be confident their children are in safe and loving care,

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and where government works to expand child care alternatives for parents.

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where we reconcile the needs of a clean environment and a strong economy,

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where Made in the USA is recognized around the world as the symbol of quality and progress,

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and where every one of us enjoys the same opportunities

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to live, to work, and to contribute to society

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and where, for the first time, the American mainstream

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includes all of our disabled citizens.

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where everyone has a roof over his head

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and where the homeless get the help they need to live in dignity,

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where our schools challenge and support our kids and our teachers,

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and where all of them make the grade.

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where every street, every city, every school, and every child is drug-free.

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And finally, where no American is forgotten, our hearts go out to our hostages,

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our hostages who are ceaselessly on our minds

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and in our efforts.

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That's part of the future.

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We want to see the future we can make for ourselves but dreams alone won get us there We need to extend our horizon commit to the long view

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and our mission for the future starts today.

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In the tough competitive markets around the world,

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America faces the great challenges and great opportunities.

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And we know that we can succeed in the global economic arena of the 90s,

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But to meet that challenge, we must make some fundamental changes, some crucial investment in ourselves.

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Yes, we are going to invest in America.

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This administration is determined to encourage the creation of capital, capital of all kinds, physical capital.

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Everything from our farms and factories to our workshops and production lines.

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all that is needed to produce and deliver quality goods and quality services.

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Intellectual capital, the source of ideas that spark tomorrow's products,

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and of course our human capital, the talented workforce that we'll need to compete in the global market.

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Let me tell you, if we ignore human capital, if we lose the spirit of American ingenuity,

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the spirit that is the hallmark of the American worker, that would be bad.

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The American worker is the most productive worker in the world.

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We need to save more.

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We need to expand the pool of capital for new investments that need more jobs and more

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growth.

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And that's the idea behind a new initiative I call the Family Savings Plan, which I will

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send to Congress tomorrow.

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We need to cut the tax on capital gains, encourage...

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I encourage risk takers, especially those in our small businesses, to take those steps

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that translate into economic reward, jobs, and a better life for all of us.

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We'll do what it takes to invest in America's future.

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The budget commitment is there.

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The money is there.

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It's there for research and development, R&D, a record high.

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It's there for our housing initiative, HOPE, H-O-P-E,

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to help everyone from first-time homebuyers to the homeless.

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The money's there to keep our kids drug-free 70% more than when I took office in 1989.

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It's there for space exploration, and it's there for education,

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Another record high.

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And one more thing.

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Last fall at the Education Summit,

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the governors and I agreed to look for ways to help make sure that our kids are ready to learn.

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The very first day they walk into the classroom,

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And I've made good on that commitment by proposing a record increase in funds,

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an extra half a billion dollars for something near and dear to all of us.

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Head start.

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Education is the one investment that means more for our future

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because it means the most for our children.

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Real improvement in our schools is not simply a matter of spending more.

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It's a matter of asking more, expecting more of our schools,

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our teachers, of our kids, of our parents, and ourselves.

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And that's why tonight I am announcing America's education goals,

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Goals developed with enormous cooperation from the nation's governors.

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And if I might, I'd like to say I'm very pleased that Governor Gardner, Governor Clinton, Governor Branstad, Governor Campbell,

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all of whom were very key in these discussions, these deliberations, are with us here tonight.

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By the year 2000, every child must start school ready to learn.

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The United States must increase the high school graduation rate to no less than 90%.

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And we are going to make sure our school's diplomas mean something.

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In critical subjects, at the 4th, 8th, and 12th grades, we must assess our students' performance.

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By the year 2000, U.S. students must be the first in the world in math and science achievement.

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Every American adult must be a skilled, literate worker and citizen.

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Every school must offer the kind of disciplined environment that makes it possible for our

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kids to learn.

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And every school in America must be drug free.

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Ambitious aims, of course.

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Easy to do.

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Far from it.

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But the future's at stake.

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The nation will not accept anything less than excellence in education.

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These investments will keep America competitive.

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And I know this about the American people.

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We welcome competition.

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We'll match our ingenuity, our energy, our experience, and technology, our spirit and

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enterprise against anyone.

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But let the competition be free, but let it also be fair.

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America is ready.

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We really mean it.

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And since we're serious about being ready to meet that

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challenge, we're getting our own house in order.

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We have made real progress.

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Seven years ago, the federal deficit

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was 6% of our gross national product, 6%.

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In the new budget I sent up two days ago,

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the deficit is down to 1% of gross national product.

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That budget brings federal spending under control.

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It meets the Graham-Rudman target.

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It brings that deficit down further

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and balances the budget by 1993 with no new taxes.

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Let me tell you.

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There's still more than enough federal spending.

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For most of us trillion is still a lot of money Once the budget is balanced we can operate the way every family must when it has bills to pay

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We won't leave it to our children and our grandchildren.

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Once it's balanced, we will start paying off the national debt.

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And there's something more.

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If there's something more we owe the generations of the future, stewardship, the safekeeping

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of America's precious environmental inheritance, is just one sign of how serious we are.

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We will elevate the Environmental Protection Agency to cabinet rank.

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Not more bureaucracy, not more red tape, but the certainty that here at home and especially

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in our dealings with other nations, environmental issues have the status they deserve.

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This year's budget provides over $2 billion in new spending to protect our environment.

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with over $1 billion for global change research

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and a new initiative I call America the Beautiful

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to expand our national parks and wildlife preserves

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and improve recreational facilities on public lands

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and something else,

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something that will help keep this country clean

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from our forest land to the inner cities

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and keep America beautiful for generations to come.

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the money to plant a billion trees a year.

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And tonight, let me say again to all the members of the Congress,

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the American people did not send us here to bicker.

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There is work to do, and they sent us here to get it done.

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And once again, in the spirit of cooperation, I offer my hand to all of you, and let's work together to do the will of the people.

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Clean air, child care, the Educational Excellence Act, crime and drugs, it's time to act.

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The Farm Bill, transportation policy, product liability reform, enterprise zones, it's time to act together.

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And there's one thing I hope we will be able to agree on.

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It's about our commitments.

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And I'm talking about Social Security.

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To every American out there on Social Security,

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to every American supporting that system today,

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and to everyone counting on it when they retire,

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we made a promise to you, and we are going to keep it.

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We rescued the system in 1983, and it's sound again.

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Bipartisan arrangement.

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Our budget fully funds today's benefits,

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and it assures that future benefits will be funded as well.

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And the last thing we need to do is mess around with Social Security.

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There's one more problem we need to address.

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We must give careful consideration to the recommendations of the health care studies underway now.

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And that's why tonight I'm asking Dr. Sullivan, Lou Sullivan, Secretary of Health and Human Services,

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to lead a domestic policy council review of recommendations on the quality, accessibility, and cost of our nation's health care system.

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I am committed to bring the staggering costs of health care under control.

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The state of the government does indeed depend on many of us in this very chamber, but the

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But the state of the union depends on all Americans.

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We must maintain the democratic decency that makes a nation out of millions of individuals.

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And I've been appalled at the recent mail bombings across this country.

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Every one of us must confront and condemn racism, anti-Semitism, bigotry, and hate.

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not next week, not tomorrow, but right now, every single one of us.

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State of the Union.

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The State of the Union depends on whether we help our neighbor claim the problems of

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our community as our own.

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We've got to step forward when there's trouble, lend a hand, be what I call a point of light

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to a stranger in need.

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We've got to take the time after a busy day to sit down and read with our kids, help them

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with their homework, pass along the values we learned as children, and that's how we

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sustain the State of the Union.

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Every effort is important.

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It all adds up.

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It's doing the things that give democracy meaning.

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It all adds up to who we are and who we will be.

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Let me say that so long as we remember the American idea, so long as we live up to the

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American ideal, the State of the Union will remain sound and strong.

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And to those who worry that we've lost our way, well, I want you to listen to parts of

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a letter written by James Markwell, Private First Class James Markwell, a 20-year-old

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Army medic of the 1st Battalion, 75th Rangers.

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It's dated December 18th, the night before our armed forces went into action in Panama.

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It's a letter servicemen write and hope will never be sent.

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And sadly, Private Markwell's mother did receive this letter.

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She passed it along to me out there in Cincinnati.

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And here's some of what he wrote.

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I've never been afraid of death, but I know he is waiting at the corner.

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I've been trained to kill and to save, and so is everyone else.

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I am frightened what lays beyond the fog,

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and yet do not mourn for me.

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Revel in the life that I have died to give you.

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But most of all, don't forget the Army was my choice,

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something that I wanted to do.

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Remember, I joined the Army to serve my country

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and ensure that you are free to do what you want

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and live your lives freely."

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Let me add that Private Markwell was among the first

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to see battle in Panama and one of the first to fall.

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But he knew what he believed in.

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He carried the idea we call America in his heart.

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I began tonight speaking about the changes

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we've seen this past year.

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There is a new world of challenges and opportunities

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before us.

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And there's a need for leadership that only America can provide.

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Nearly 40 years ago, in his last address to the Congress,

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President Harry Truman predicted such a time would come.

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He said, as our world grows stronger, more united,

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more attractive to men on both sides of the Iron Curtain,

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then inevitably there will come a time of change

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within the communist world.

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Today, that change is taking place.

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For more than 40 years, America and its allies

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held communism in check and ensured that democracy would continue to exist And today with communism crumbling our aim must be to ensure democracy advance

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to take the lead in forging peace and freedom's best hope,

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a great and growing commonwealth of free nations.

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And to the Congress and to all Americans,

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I say it is time to acclaim a new consensus

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at home and abroad,

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A common vision of the peaceful world we want to see.

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Here in our own hemisphere, it is time for all the peoples of the Americas,

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north and south, to live in freedom.

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In the Far East and Africa,

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It's time for the full flowering of free governments and free markets that have served as the engine of progress.

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It's time to offer our hand to the emerging democracies of Eastern Europe

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so that continent, for too long a continent divided, can see a future whole and free.

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It's time to build on our new relationship with the Soviet Union,

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to endorse and encourage a peaceful process of internal change toward democracy and economic opportunity.

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We're in a period of great transition, great hope, and yet great uncertainty.

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We recognize that the Soviet military threat in Europe is diminishing,

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but we see little change in Soviet strategic modernization.

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And therefore, we must sustain our own strategic offense modernization and the Strategic Defense

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Initiative.

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But the time is right to move forward on a conventional arms control agreement to move

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us to more appropriate levels of military forces in Europe, a coherent defense program

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that ensures the U.S. will continue to be a catalyst for peaceful change in Europe.

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And I've consulted with leaders of NATO.

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In fact, I spoke by phone with President Gorbachev just today.

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And I agree with our European allies that an American military presence in Europe is

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essential and that it should not be tied solely to the Soviet military presence in Eastern

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Europe.

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But our troop levels can still be lower.

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And so tonight I am announcing a major new step for a further reduction in U.S. and Soviet

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manpower in Central and Eastern Europe to 195,000 on each side.

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This number, this level reflects the advice of our senior military advisors.

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It's designed to protect American and European interests and sustain NATO's defense strategy.

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A swift conclusion to our arms control talks, conventional, chemical, and strategic, must

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now be our goal.

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And that time has come.

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Still, we must recognize an unfortunate fact.

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In many regions of the world tonight, the reality is conflict, not peace.

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Enduring animosities and opposing interests remain.

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And thus, the cause of peace must be served by an America strong enough and sure enough

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to defend our interests and our ideals.

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It's this American idea that for the past four decades helped inspire this revolution

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of 89.

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And here at home and in the world, there is history in the making, history to be made.

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Six months ago, early in this season of change, I stood at the gates of the Gdansk shipyard

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in Poland at the monument to the fallen workers of solidarity.

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It's a monument of simple majesty.

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Three tall crosses rise up from the stones, and atop each cross, an anchor, an ancient

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symbol of hope.

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The anchor in our world today is freedom, holding us steady in times of change, a symbol

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of hope to all the world.

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And freedom is at the very heart of the idea that is America.

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Giving life to the idea depends on every one of us.

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Our anchor has always been faith and family.

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In the last few days of this past momentous year, our family was blessed once more celebrating

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the joy of life when a little boy became our 12th grandchild.

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And I held the little guy for the first time.

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The troubles at home and abroad seem manageable

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and totally in perspective.

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And now I know, now I know.

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I know you're probably thinking, well,

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that's just a grandfather talking.

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Well, maybe you're right.

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But I've met a lot of children this past year

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across this country, as all of you have,

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everywhere from the Far East to Eastern Europe.

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And all kids are unique, and yet all kids are alike.

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The budding young environmentalists I met this month

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who joined me in exploring the Florida Everglades,

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the Little Leaguers I played catch with in Poland,

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ready to go from Warsaw to the World Series,

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and even the kids who are ill or alone.

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And God bless those border babies born addicted to drugs and AIDS and coping with problems no child should have to face.

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But you know, when it comes to hope and the future, every kid is the same.

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Full of dreams, ready to take on the world, all special.

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Because they are the very future of freedom.

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And to them belongs this new world I've been speaking about.

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And so tonight I'm going to ask something of every one of you.

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Let me start with my generation, with the grandparents out there.

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You are our living link to the past.

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Tell your grandchildren the story of struggles waged at home and abroad, of sacrifices freely

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made for freedom's sake, and tell them your own story as well, because every American

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has a story to tell.

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And parents, your children look to you for direction and guidance.

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Tell them of faith and family.

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Tell them we are one nation under God.

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Teach them that of all the many gifts they can receive, liberty is their most precious

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legacy.

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And of all the gifts they can give, the greatest, the greatest is helping others.

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And to the children and young people out there tonight, with you rests our hope.

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All that America will mean in the years and decades ahead.

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your vision on a new century, your century, on dreams we cannot see, on the destiny that

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is yours and yours alone. And finally, let all Americans, all of us together here in

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this chamber, the symbolic center of democracy, affirm our allegiance to this idea we call

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America, and let us remember that the state of the Union depends on each and every one

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of us. God bless all of you and may God bless this great nation, the United States of America.