[Public Papers of the Presidents of the United States: George H. W. Bush (1992, Book I)]
[January 28, 1992]
[Pages 156-163]
[From the U.S. Government Publishing Office www.gpo.gov]



Address Before a Joint Session of the Congress on the State of the Union

January 28, 1992
Mr. Speaker and Mr. President, distinguished Members of Congress, 
honored guests, and fellow citizens:
    Thank you very much for that warm reception. You know, with the big 
buildup this address has had, I wanted to make sure it would be a big 
hit, but I couldn't convince Barbara to deliver it for me. [Laughter]
    I see the Speaker and the Vice President are laughing. They saw what 
I did in Japan, and they're just happy they're sitting behind me. 
[Laughter]
    I mean to speak tonight of big things, of big changes and the 
promises they hold, and of some big problems and how, together, we can 
solve them and move our country forward as the undisputed leader of the 
age.
    We gather tonight at a dramatic and deeply promising time in our 
history and in the history of man on Earth. For in the past 12 months, 
the world has known changes of almost Biblical proportions. And even 
now, months after the failed coup that doomed a failed system, I'm not 
sure we've absorbed

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the full impact, the full import of what happened. But communism died 
this year.
    Even as President, with the most fascinating possible vantage point, 
there were times when I was so busy managing progress and helping to 
lead change that I didn't always show the joy that was in my heart. But 
the biggest thing that has happened in the world in my life, in our 
lives, is this: By the grace of God, America won the cold war.
    I mean to speak this evening of the changes that can take place in 
our country, now that we can stop making the sacrifices we had to make 
when we had an avowed enemy that was a superpower. Now we can look 
homeward even more and move to set right what needs to be set right.
    I will speak of those things. But let me tell you something I've 
been thinking these past few months. It's a kind of rollcall of honor. 
For the cold war didn't end; it was won. And I think of those who won 
it, in places like Korea and Vietnam. And some of them didn't come back. 
Back then they were heroes, but this year they were victors.
    The long rollcall, all the G.I. Joes and Janes, all the ones who 
fought faithfully for freedom, who hit the ground and sucked the dust 
and knew their share of horror. This may seem frivolous, and I don't 
mean it so, but it's moving to me how the world saw them. The world saw 
not only their special valor but their special style: their 
rambunctious, optimistic bravery, their do-or-die unity unhampered by 
class or race or region. What a group we've put forth, for generations 
now, from the ones who wrote ``Kilroy was here'' on the walls of the 
German stalags to those who left signs in the Iraqi desert that said, 
``I saw Elvis.'' What a group of kids we've sent out into the world.
    And there's another to be singled out, though it may seem inelegant, 
and I mean a mass of people called the American taxpayer. No one ever 
thinks to thank the people who pay a country's bill or an alliance's 
bill. But for half a century now, the American people have shouldered 
the burden and paid taxes that were higher than they would have been to 
support a defense that was bigger than it would have been if imperial 
communism had never existed. But it did; doesn't anymore. And here's a 
fact I wouldn't mind the world acknowledging: The American taxpayer bore 
the brunt of the burden and deserves a hunk of the glory.
    So now, for the first time in 35 years, our strategic bombers stand 
down. No longer are they on 'round-the-clock alert. Tomorrow our 
children will go to school and study history and how plants grow. And 
they won't have, as my children did, air raid drills in which they crawl 
under their desks and cover their heads in case of nuclear war. My 
grandchildren don't have to do that and won't have the bad dreams 
children had once, in decades past. There are still threats. But the 
long, drawn-out dread is over.
    A year ago tonight, I spoke to you at a moment of high peril. 
American forces had just unleashed Operation Desert Storm. And after 40 
days in the desert skies and 4 days on the ground, the men and women of 
America's Armed Forces and our allies accomplished the goals that I 
declared and that you endorsed: We liberated Kuwait. Soon after, the 
Arab world and Israel sat down to talk seriously and comprehensively 
about peace, an historic first. And soon after that, at Christmas, the 
last American hostages came home. Our policies were vindicated.
    Much good can come from the prudent use of power. And much good can 
come of this: A world once divided into two armed camps now recognizes 
one sole and preeminent power, the United States of America. And they 
regard this with no dread. For the world trusts us with power, and the 
world is right. They trust us to be fair and restrained. They trust us 
to be on the side of decency. They trust us to do what's right.
    I use those words advisedly. A few days after the war began, I 
received a telegram from Joanne Speicher, the wife of the first pilot 
killed in the Gulf, Lieutenant Commander Scott Speicher. Even in her 
grief, she wanted me to know that some day when her children were old 
enough, she would tell them ``that their father went away to war because 
it was the right thing to do.'' And she said it all: It was the right

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thing to do.
    And we did it together. There were honest differences right here in 
this Chamber. But when the war began, you put partisanship aside, and we 
supported our troops. This is still a time for pride, but this is no 
time to boast. For problems face us, and we must stand together once 
again and solve them and not let our country down.
    Two years ago, I began planning cuts in military spending that 
reflected the changes of the new era. But now, this year, with imperial 
communism gone, that process can be accelerated. Tonight I can tell you 
of dramatic changes in our strategic nuclear force. These are actions we 
are taking on our own because they are the right thing to do. After 
completing 20 planes for which we have begun procurement, we will shut 
down further production of the B-2 bombers. We will cancel the small 
ICBM program. We will cease production of new warheads for our sea-based 
ballistic missiles. We will stop all new production of the Peacekeeper 
missile. And we will not purchase any more advanced cruise missiles.
    This weekend I will meet at Camp David with Boris Yeltsin of the 
Russian Federation. I've informed President Yeltsin that if the 
Commonwealth, the former Soviet Union, will eliminate all land-based 
multiple-warhead ballistic missiles, I will do the following: We will 
eliminate all Peacekeeper missiles. We will reduce the number of 
warheads on Minuteman missiles to one and reduce the number of warheads 
on our sea-based missiles by about one-third. And we will convert a 
substantial portion of our strategic bombers to primarily conventional 
use. President Yeltsin's early response has been very positive, and I 
expect our talks at Camp David to be fruitful.
    I want you to know that for half a century, American Presidents have 
longed to make such decisions and say such words. But even in the midst 
of celebration, we must keep caution as a friend. For the world is still 
a dangerous place. Only the dead have seen the end of conflict. And 
though yesterday's challenges are behind us, tomorrow's are being born.
    The Secretary of Defense recommended these cuts after consultation 
with the Joint Chiefs of Staff. And I make them with confidence. But do 
not misunderstand me. The reductions I have approved will save us an 
additional $50 billion over the next 5 years. By 1997, we will have cut 
defense by 30 percent since I took office. These cuts are deep, and you 
must know my resolve: This deep, and no deeper. To do less would be 
insensible to progress, but to do more would be ignorant of history. We 
must not go back to the days of ``the hollow army.'' We cannot repeat 
the mistakes made twice in this century when armistice was followed by 
recklessness and defense was purged as if the world were permanently 
safe.
    I remind you this evening that I have asked for your support in 
funding a program to protect our country from limited nuclear missile 
attack. We must have this protection because too many people in too many 
countries have access to nuclear arms. And I urge you again to pass the 
Strategic Defense Initiative, SDI.
    There are those who say that now we can turn away from the world, 
that we have no special role, no special place. But we are the United 
States of America, the leader of the West that has become the leader of 
the world. And as long as I am President, I will continue to lead in 
support of freedom everywhere, not out of arrogance, not out of 
altruism, but for the safety and security of our children. This is a 
fact: Strength in the pursuit of peace is no vice; isolationism in the 
pursuit of security is no virtue.
    And now to our troubles at home. They're not all economic; the 
primary problem is our economy. There are some good signs. Inflation, 
that thief, is down. And interest rates are down. But unemployment is 
too high, some industries are in trouble, and growth is not what it 
should be. Let me tell you right from the start and right from the 
heart, I know we're in hard times. But I know something else: This will 
not stand.
    In this Chamber, in this Chamber we can bring the same courage and 
sense of common purpose to the economy that we brought to Desert Storm. 
And we can defeat hard times together. I believe you'll help. One reason 
is that you're patriots, and you want the best for your country. And I 
believe that in your hearts you want to put partisanship aside and get 
the job done be-

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cause it's the right thing to do.
    The power of America rests in a stirring but simple idea, that 
people will do great things if only you set them free. Well, we're going 
to set the economy free. For if this age of miracles and wonders has 
taught us anything, it's that if we can change the world we can change 
America. We must encourage investment. We must make it easier for people 
to invest money and create new products, new industries, and new jobs. 
We must clear away the obstacles to growth: high taxes, high regulation, 
redtape, and yes, wasteful Government spending.
    None of this will happen with a snap of the fingers, but it will 
happen. And the test of a plan isn't whether it's called new or 
dazzling. The American people aren't impressed by gimmicks; they're 
smarter on this score than all of us in this room. The only test of a 
plan is: Is it sound, and will it work?
    We must have a short-term plan to address our immediate needs and 
heat up the economy. And then we need a longer term plan to keep 
combustion going and to guarantee our place in the world economy. There 
are certain things that a President can do without Congress, and I'm 
going to do them.
    I have, this evening, asked major Cabinet departments and Federal 
agencies to institute a 90-day moratorium on any new Federal regulations 
that could hinder growth. In those 90 days, major departments and 
agencies will carry out a top-to-bottom review of all regulations, old 
and new, to stop the ones that will hurt growth and speed up those that 
will help growth.
    Further, for the untold number of hard-working, responsible American 
workers and business men and women who've been forced to go without 
needed bank loans, the banking credit crunch must end. I won't neglect 
my responsibility for sound regulations that serve the public good, but 
regulatory overkill must be stopped. And I've instructed our Government 
regulators to stop it.
    I have directed Cabinet departments and Federal agencies to speed up 
progrowth expenditures as quickly as possible. This should put an extra 
$10 billion into the economy in the next 6 months. And our new 
transportation bill provides more than $150 billion for construction and 
maintenance projects that are vital to our growth and well-being. And 
that means jobs building roads, jobs building bridges, and jobs building 
railways.
    And I have, this evening, directed the Secretary of the Treasury to 
change the Federal tax withholding tables. With this change, millions of 
Americans from whom the Government withholds more than necessary can now 
choose to have the Government withhold less from their paychecks. 
Something tells me a number of taxpayers may take us up on this one. 
This initiative could return about $25 billion back into our economy 
over the next 12 months, money people can use to help pay for clothing, 
college, or to get a new car. Finally, working with the Federal Reserve, 
we will continue to support monetary policy that keeps both interest 
rates and inflation down.
    Now, these are the things I can do. And now, Members of Congress, 
let me tell you what you can do for your country. You must pass the 
other elements of my plan to meet our economic needs. Everyone knows 
that investment spurs recovery. I am proposing this evening a change in 
the alternative minimum tax and the creation of a new 15-percent 
investment tax allowance. This will encourage businesses to accelerate 
investment and bring people back to work.
    Real estate has led our economy out of almost all the tough times 
we've ever had. Once building starts, carpenters and plumbers work; 
people buy homes and take out mortgages. My plan would modify the 
passive loss rule for active real estate developers. And it would make 
it easier for pension plans to purchase real estate. For those Americans 
who dream of buying a first home but who can't quite afford it, my plan 
would allow first-time homebuyers to withdraw savings from IRA's without 
penalty and provide a $5,000 tax credit for the first purchase of that 
home.
    And finally, my immediate plan calls on Congress to give crucial 
help to people who own a home, to everyone who has a business or a farm 
or a single investment. This time, at this hour, I cannot take no for an

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answer. You must cut the capital gains tax on the people of our country. 
Never has an issue been more demagogued by its opponents. But the 
demagogs are wrong. They are wrong, and they know it. Sixty percent of 
the people who benefit from lower capital gains have incomes under 
$50,000. A cut in the capital gains tax increases jobs and helps just 
about everyone in our country. And so, I'm asking you to cut the capital 
gains tax to a maximum of 15.4 percent.
    I'll tell you, those of you who say, ``Oh, no, someone who's 
comfortable may benefit from that,'' you kind of remind me of the old 
definition of the Puritan who couldn't sleep at night, worrying that 
somehow, someone somewhere was out having a good time. [Laughter] The 
opponents of this measure and those who have authored various so-called 
soak-the-rich bills that are floating around this Chamber should be 
reminded of something: When they aim at the big guy, they usually hit 
the little guy. And maybe it's time that stopped.
    This, then, is my short-term plan. Your part, Members of Congress, 
requires enactment of these commonsense proposals that will have a 
strong effect on the economy without breaking the budget agreement and 
without raising tax rates.
    While my plan is being passed and kicking in, we've got to care for 
those in trouble today. I have provided for up to $4.4 billion in my 
budget to extend Federal unemployment benefits. And I ask for 
congressional action right away. And I thank the committee. [Applause] 
Well, at last.
    Let's be frank. Let's be frank. Let me level with you. I know and 
you know that my plan is unveiled in a political season. [Laughter] I 
know and you know that everything I propose will be viewed by some in 
merely partisan terms. But I ask you to know what is in my heart. And my 
aim is to increase our Nation's good. I'm doing what I think is right, 
and I am proposing what I know will help.
    I pride myself that I'm a prudent man, and I believe that patience 
is a virtue. But I understand that politics is, for some, a game and 
that sometimes the game is to stop all progress and then decry the lack 
of improvement. [Laughter] But let me tell you: Far more important than 
my political future and far more important than yours is the well-being 
of our country. Members of this Chamber are practical people, and I know 
you won't resent some practical advice. When people put their party's 
fortunes, whatever the party, whatever side of this aisle, before the 
public good, they court defeat not only for their country but for 
themselves. And they will certainly deserve it.
    I submit my plan tomorrow, and I'm asking you to pass it by March 
20th. And I ask the American people to let you know they want this 
action by March 20th. From the day after that, if it must be, the battle 
is joined. And you know, when principle is at stake I relish a good, 
fair fight.
    I said my plan has two parts, and it does. And it's the second part 
that is the heart of the matter. For it's not enough to get an immediate 
burst. We need long-term improvement in our economic position. We all 
know that the key to our economic future is to ensure that America 
continues as an economic leader of the world. We have that in our power. 
Here, then, is my long-term plan to guarantee our future.
    First, trade: We will work to break down the walls that stop world 
trade. We will work to open markets everywhere. And in our major trade 
negotiations, I will continue pushing to eliminate tariffs and subsidies 
that damage America's farmers and workers. And we'll get more good 
American jobs within our own hemisphere through the North American free 
trade agreement and through the Enterprise for the Americas Initiative.
    But changes are here, and more are coming. The workplace of the 
future will demand more highly skilled workers than ever, more people 
who are computer-literate, highly educated. We must be the world's 
leader in education. And we must revolutionize America's schools. My 
America 
2000 strategy will help us reach that goal. 
My plan will give parents more choice, 
give teachers more flexibility, and help 
communities create new American schools. 
Thirty States across the Nation have 
established America 2000 programs. Hundreds of cities and towns have 
joined in. Now Congress must join this great move-

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ment: Pass my proposals for new American schools.
    That was my second long-term proposal, and here's my third: We must 
make commonsense investments that will help us compete, long-term, in 
the marketplace. We must encourage research and development. My plan is 
to make the R&D tax credit permanent and to provide record levels of 
support, over $76 billion this year alone, for people who will explore 
the promise of emerging technologies.
    Fourth, we must do something about crime and drugs. It is time for a 
major, renewed investment in fighting violent street crime. It saps our 
strength and hurts our faith in our society and in our future together. 
Surely a tired woman on her way to work at 6 in the morning on a subway 
deserves the right to get there safely. And surely it's true that 
everyone who changes his or her life because of crime, from those afraid 
to go out at night to those afraid to walk in the parks they pay for, 
surely these people have been denied a basic civil right. It is time to 
restore it. Congress, pass my comprehensive crime bill. It is tough on 
criminals and supportive of police, and it has been languishing in these 
hallowed halls for years now. Pass it. Help your country.
    Fifth, I ask you tonight to fund our HOPE housing proposal and to 
pass my enterprise zone legislation which will get businesses into the 
inner city. We must empower the poor with the pride that comes from 
owning a home, getting a job, becoming a part of things. My plan would 
encourage real estate construction by extending tax incentives for 
mortgage revenue bonds and low-income housing. And I ask tonight for 
record expenditures for the program that helps children born into want 
move into excellence, Head Start.
    Step six, we must reform our health care system. For this, too, 
bears on whether or not we can compete in the world. American health 
costs have been exploding. This year America will spend over $800 
billion on health, and that is expected to grow to 1.6 trillion by the 
end of the decade. We simply cannot afford this. The cost of health care 
shows up not only in your family budget but in the price of everything 
we buy and everything we sell. When health coverage for a fellow on an 
assembly line costs thousands of dollars, the cost goes into the 
products he makes, and you pay the bill.
    We must make a choice. Now, some pretend we can have it both ways. 
They call it ``play or pay,'' but that expensive approach is unstable. 
It will mean higher taxes, fewer jobs, and eventually a system under 
complete Government control.
    Really, there are only two options. And we can move toward a 
nationalized system, a system which will restrict patient choice in 
picking a doctor and force the Government to ration services 
arbitrarily. And what we'll get is patients in long lines, indifferent 
service, and a huge new tax burden. Or we can reform our own private 
health care system, which still gives us, for all its flaws, the best 
quality health care in the world.
    Well, let's build on our strengths. My plan provides insurance 
security for all Americans while preserving and increasing the idea of 
choice. We make basic health insurance affordable for all low-income 
people not now covered, and we do it by providing a health insurance tax 
credit of up to $3,750 for each low-income family. And the middle class 
gets help, too. And by reforming the health insurance market, my plan 
assures that Americans will have access to basic health insurance even 
if they change jobs or develop serious health problems. We must bring 
costs under control, preserve quality, preserve choice, and reduce the 
people's nagging daily worry about health insurance. My plan, the 
details of which I'll announce very shortly, does just that.
    Seventh, we must get the Federal deficit under control. We now have, 
in law, enforceable spending caps and a requirement that we pay for the 
programs we create. There are those in Congress who would ease that 
discipline now. But I cannot let them do it, and I won't.
    My plan would freeze all domestic discretionary budget authority, 
which means no more next year than this year. I will not tamper with 
Social Security, but I would put real caps on the growth of uncontrolled 
spending. And I would also freeze Federal domestic Government 
employment. And with the help of Congress, my plan will get

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rid of 246 programs that don't deserve Federal funding. Some of them 
have noble titles, but none of them is indispensable. We can get rid of 
each and every one of them.
    You know, it's time we rediscovered a home truth the American people 
have never forgotten: This Government is too big and spends too much. 
And I call upon Congress to adopt a measure that will help put an end to 
the annual ritual of filling the budget with pork barrel appropriations. 
Every year, the press has a field day making fun of outrageous examples: 
a Lawrence Welk museum, research grants for Belgian endive. We all know 
how these things get into the budget, and maybe you need someone to help 
you say no. I know how to say it, and I know what I need to make it 
stick. Give me the same thing 43 Governors have, the line-item veto, and 
let me help you control spending.
    We must put an end to unfinanced Federal Government mandates. These 
are the requirements Congress puts on our cities, counties, and States 
without supplying the money. If Congress passes a mandate, it should be 
forced to pay for it and balance the cost with savings elsewhere. After 
all, a mandate just increases someone else's burden, and that means 
higher taxes at the State and local level.
    Step eight, Congress should enact the bold reform proposals that are 
still awaiting congressional action: bank reform, civil justice reform, 
tort reform, and my national energy strategy.
    And finally, we must strengthen the family because it is the family 
that has the greatest bearing on our future. When Barbara holds an AIDS 
baby in her arms and reads to children, she's saying to every person in 
this country: Family matters.
    And I am announcing tonight a new Commission on America's Urban 
Families. I've asked Missouri's Governor John Ashcroft to be Chairman, 
former Dallas Mayor Annette Strauss to be Cochair. You know, I had 
mayors, the leading mayors from the League of Cities, in the other day 
at the White House, and they told me something striking. They said that 
every one of them, Republican or Democrat, agreed on one thing, that the 
major cause of the problems of the cities is the dissolution of the 
family. They asked for this Commission, and they were right to ask 
because it's time to determine what we can do to keep families together, 
strong and sound.
    There's one thing we can do right away: Ease the burden of rearing a 
child. I ask you tonight to raise the personal exemption by $500 per 
child for every family. For a family with four kids, that's an increase 
of $2,000. This is a good start in the right direction, and it's what we 
can afford.
    It's time to allow families to deduct the interest they pay on 
student loans. I am asking you to do just that. And I'm asking you to 
allow people to use money from their IRA's to pay medical and education 
expenses, all without penalties.
    And I'm asking for more. Ask American parents what they dislike 
about how things are going in our country, and chances are good that 
pretty soon they'll get to welfare. Americans are the most generous 
people on Earth. But we have to go back to the insight of Franklin 
Roosevelt who, when he spoke of what became the welfare program, warned 
that it must not become ``a narcotic'' and a ``subtle destroyer'' of the 
spirit. Welfare was never meant to be a lifestyle. It was never meant to 
be a habit. It was never supposed to be passed from generation to 
generation like a legacy. It's time to replace the assumptions of the 
welfare state and help reform the welfare system.
    States throughout the country are beginning to operate with new 
assumptions that when able-bodied people receive Government assistance, 
they have responsibilities to the taxpayer: A responsibility to seek 
work, education, or job training; a responsibility to get their lives in 
order; a responsibility to hold their families together and refrain from 
having children out of wedlock; and a responsibility to obey the law. We 
are going to help this movement. Often, State reform requires waiving 
certain Federal regulations. I will act to make that process easier and 
quicker for every State that asks for our help.
    I want to add, as we make these changes, we work together to improve 
this system, that our intention is not scapegoating or finger-pointing. 
If you read the papers and

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watch TV, you know there's been a rise these days in a certain kind of 
ugliness: racist comments, anti-Semitism, an increased sense of 
division. Really, this is not us. This is not who we are. And this is 
not acceptable.
    And so, you have my plan for America. And I'm asking for big things, 
but I believe in my heart you'll do what's right.
    You know, it's kind of an American tradition to show a certain 
skepticism toward our democratic institutions. I myself have sometimes 
thought the aging process could be delayed if it had to make its way 
through Congress. [Laughter] You will deliberate, and you will discuss, 
and that is fine. But, my friends, the people cannot wait. They need 
help now.
    There's a mood among us. People are worried. There's been talk of 
decline. Someone even said our workers are lazy and uninspired. And I 
thought: Really? You go tell Neil Armstrong standing on the moon. Tell 
the men and women who put him there. Tell the American farmer who feeds 
his country and the world. Tell the men and women of Desert Storm.
    Moods come and go, but greatness endures. Ours does. And maybe for a 
moment it's good to remember what, in the dailiness of our lives, we 
forget: We are still and ever the freest nation on Earth, the kindest 
nation on Earth, the strongest nation on Earth. And we have always risen 
to the occasion. And we are going to lift this Nation out of hard times 
inch by inch and day by day, and those who would stop us had better step 
aside. Because I look at hard times, and I make this vow: This will not 
stand.
    And so, we move on together, a rising nation, the once and future 
miracle that is still, this night, the hope of the world. Thank you. God 
bless you, and God bless our beloved country. Thank you very, very much.

                    Note: The President spoke at 9:07 p.m. in the House 
                        Chamber of the Capitol. The address was 
                        broadcast live on nationwide radio and 
                        television. The Executive order of March 12 
                        establishing the National Commission on 
                        America's Urban Families is listed in Appendix E 
                        at the end of this volume.