When the Congress approves, the Federal Government will be able to provide a substantial percentage of the cost:

—90 percent of the cost of developing the State and local plans, master plans, to combat crime in their area;

—60 percent of the cost of training new tactical units, developing instant communications and special alarm systems, and introducing the latest equipment and techniques so that they can become weapons in the war on crime;

—50 percent of the cost of building crime laboratories and police academy-type centers so that our citizens can be protected by the best trained and served by the best equipped police to be found anywhere. We will also recommend new methods to prevent juvenile delinquents from becoming adult delinquents. We will seek new partnerships with States and cities in order to deal with this hideous narcotics problem. And we will recommend strict controls on the sale of firearms.

At the heart of this attack on crime must be the conviction that a free America—as Abraham Lincoln once said—must "let reverence for the laws . . . become the political religion of the Nation."

Our country's laws must be respected. Order must be maintained. And I will support—with all the constitutional powers the President possesses—our Nation's law enforcement officials in their attempt to control the crime and the violence that tear the fabric of our communities.

Many of these priority proposals will be built on foundations that have already been laid. Some will necessarily be small at first, but "every beginning is a consequence." If we postpone this urgent work now, it will simply have to be done later, and later we will pay a much higher price.

Our fourth objective is prosperity, to keep our economy moving ahead, moving ahead steadily and safely.

We have now enjoyed 6 years of unprecedented and rewarding prosperity. Last year, in 1966:

—Wages were the highest in history—and the unemployment rate, announced yesterday, reached the lowest point in 13 years;

—Total after-tax income of American families rose nearly 5 percent;

—Corporate profits after taxes rose a little more than 5 percent;

—Our gross national product advanced 5.5 percent, to about $740 billion;

—Income per farm went up 6 percent.

Now we have been greatly concerned because consumer prices rose 4.5 percent over the 18 months since we decided to send troops to Vietnam. This was more than we had expected—and the Government tried to do everything that we knew how to do to hold it down. Yet we were not as successful as we wished to be. In the 18 months after we entered World War II, prices rose not 4.5 percent, but 13.5 percent. In the first 18 months after Korea, after the conflict broke out there, prices rose not 4.5 percent, but 11 percent. During those two periods we had OPA price control that the Congress gave us and War Labor Board wage controls.

Since Vietnam we have not asked for those controls and we have tried to avoid imposing them. We believe that we have done better, but we make no pretense of having been successful or doing as well as we wished.

Our greatest disappointment in the economy during 1966 was the excessive rise in interest rates and the tightening of credit. They imposed very severe and very unfair burdens on our home buyers and on our home builders, and all those associated with the home industry.

Last January, and again last September, I recommended fiscal and moderate tax measures to try to restrain the unbalanced pace of economic expansion. Legislatively and administratively we took several billions out of the economy. With these measures, in both instances, the Congress approved most of the recommendations rather promptly.

As 1966 ended, price stability was seemingly being restored. Wholesale prices are lower tonight than they were in August. So are retail food prices. Monetary conditions are also easing. Most interest rates have retreated from their earlier peaks. More money now seems to be available.

Given the cooperation of the Federal Reserve System, which I so earnestly seek, I am confident that this movement can continue. I pledge the American people that I will do everything in a President's power to lower interest rates and to ease money in this country. The Federal Home Loan Bank Board tomorrow morning will announce that it will make immediately available to savings and loan associations an additional $1 billion, and will lower from 6 percent to 5 3/4 percent the interest rate charged on those loans.

We shall continue on a sensible course of fiscal and budgetary policy that we believe will keep our economy growing without new inflationary spirals; that will finance responsibly the needs of our men in Vietnam and the progress of our people at home; that will support a significant improvement in our export surplus, and will press forward toward easier credit and toward lower interest rates.

I recommend to the Congress a surcharge of 6 percent on both corporate and individual income taxes—to last for 2 years or for so long as the unusual expenditures associated with our efforts in Vietnam continue. I will promptly recommend an earlier termination date if a reduction in these expenditures permits it. This surcharge will raise revenues by some $4.5 billion in the first year. For example, a person whose tax payment, the tax he owes, is $1,000, will pay, under this proposal, an extra $60 over the 12-month period, or $5 a month. The overwhelming majority of Americans who pay taxes today are below that figure and they will pay substantially less than $5 a month. Married couples with two children, with incomes up to $5,000 per year, will be exempt from this tax—as will single people with an income of up to $1,900 a year.

Now if Americans today still paid the income and excise tax rates in effect when I came into the Presidency, in the year 1964, their annual taxes would have been over $20 billion more than at present tax rates. So this proposal is that while we have this problem and this emergency in Vietnam, while we are trying to meet the needs of our people at home, your Government asks for slightly more than one-fourth of that tax cut each year in order to try to hold our budget deficit in fiscal 1968 within prudent limits and to give our country and to give our fighting men the help they need in this hour of trial.

For fiscal 1967, we estimate the budget expenditures to be $126.7 billion and revenues of $117 billion. That will leave us a deficit this year of $9.7 billion.

For fiscal 1968, we estimate budget expenditures of $135 billion. And with the tax measures recommended, and a continuing strong economy, we estimate revenues will be $126.9 billion. The deficit then will be $8.1 billion.

I will very soon forward all of my recommendations to the Congress. Yours is the responsibility to discuss and to debate them—to approve or modify or reject them.

I welcome your views, as I have welcomed working with you for 30 years as a colleague and as Vice President and President.

I should like to say to the Members of the opposition—whose numbers, if I am not mistaken, seem to have increased somewhat—that the genius of the American political system has always been best expressed through creative debate that offers choices and reasonable alternatives. Throughout our history, great Republicans and Democrats have seemed to understand this. So let there be light and reason in our relations. That is the way to a responsible session and a responsive government.

Let us be remembered as a President and a Congress who tried to improve the quality of life for every American—not just the rich, not just the poor, but every man, woman, and child in this great Nation of ours.

We all go to school—to good schools or bad schools. We all take air into our lungs—clean air or polluted air. We all drink water—pure water or polluted water. We all face sickness someday, and some more often than we wish, and old age as well. We all have a stake in this Great Society—in its economic growth, in reduction of civil strife—a great stake in good government.

We just must not arrest the pace of progress we have established in this country in these years. Our children's children will pay the price if we are not wise enough, and courageous enough, and determined enough to stand up and meet the Nation's needs as well as we can in the time allotted us. III.

Abroad, as at home, there is also risk in change. But abroad, as at home, there is a greater risk in standing still. No part of our foreign policy is so sacred that it ever remains beyond review. We shall be flexible where conditions in the world change—and where man's efforts can change them for the better.

We are in the midst of a great transition—a transition from narrow nationalism to international partnership; from the harsh spirit of the cold war to the hopeful spirit of common humanity on a troubled and a threatened planet.

In Latin America, the American chiefs of state will be meeting very shortly to give our hemispheric policies new direction.

We have come a long way in this hemisphere since the inter-American effort in economic and social development was launched by the conference at Bogota in 1960 under the leadership of President Eisenhower. The Alliance for Progress moved dramatically forward under President Kennedy. There is new confidence that the voice of the people is being heard; that the dignity of the individual is stronger than ever in this hemisphere, and we are facing up to and meeting many of the hemispheric problems together. In this hemisphere that reform under democracy can be made to happen—because it has happened. So together, I think, we must now move to strike down the barriers to full cooperation among the American nations, and to free the energies and the resources of two great continents on behalf of all of our citizens.

Africa stands at an earlier stage of development than Latin America. It has yet to develop the transportation, communications, agriculture, and, above all, the trained men and women without which growth is impossible. There, too, the job will best be done if the nations and peoples of Africa cooperate on a regional basis. More and more our programs for Africa are going to be directed toward self-help.

The future of Africa is shadowed by unsolved racial conflicts. Our policy will continue to reflect our basic commitments as a people to support those who are prepared to work towards cooperation and harmony between races, and to help those who demand change but reject the fool's gold of violence.

In the Middle East the spirit of good will toward all, unfortunately, has not yet taken hold. An already tortured peace seems to be constantly threatened. We shall try to use our influence to increase the possibilities of improved relations among the nations of that region. We are working hard at that task.

In the great subcontinent of South Asia live more than a sixth of the earth's population. Over the years we—and others—have invested very heavily in capital and food for the economic development of India and Pakistan.

We are not prepared to see our assistance wasted, however, in conflict. It must strengthen their capacity to help themselves. It must help these two nations—both our friends—to overcome poverty, to emerge as self-reliant leaders, and find terms for reconciliation and cooperation.

In Western Europe we shall maintain in NATO an integrated common defense. But we also look forward to the time when greater security can be achieved through measures of arms control and disarmament, and through other forms of practical agreement.

We are shaping a new future of enlarged partnership in nuclear affairs, in economic and technical cooperation, in trade negotiations, in political consultation, and in working together with the governments and peoples of Eastern Europe and the Soviet Union.

The emerging spirit of confidence is precisely what we hoped to achieve when we went to work a generation ago to put our shoulder to the wheel and try to help rebuild Europe. We faced new challenges and opportunities then and there—and we faced also some dangers. But I believe that the peoples on both sides of the Atlantic, as well as both sides of this Chamber, wanted to face them together.

Our relations with the Soviet Union and Eastern Europe are also in transition. We have avoided both the acts and the rhetoric of the cold war. When we have differed with the Soviet Union, or other nations, for that matter, I have tried to differ quietly and with courtesy, and without venom.

Our objective is not to continue the cold war, but to end it.

We have reached an agreement at the United Nations on the peaceful uses of outer space.

We have agreed to open direct air flights with the Soviet Union.

We have removed more than 400 nonstrategic items from export control.

We are determined that the Export-Import Bank can allow commercial credits to Poland, Hungary, Bulgaria, and Czechoslovakia, as well as to Romania and Yugoslavia.

We have entered into a cultural agreement with the Soviet Union for another 2 years.

We have agreed with Bulgaria and Hungary to upgrade our legations to embassies.

We have started discussions with international agencies on ways of increasing contacts with Eastern European countries.

This administration has taken these steps even as duty compelled us to fulfill and execute alliances and treaty obligations throughout the world that were entered into before I became President.

So tonight I now ask and urge this Congress to help our foreign and our commercial trade policies by passing an East-West trade bill and by approving our consular convention with the Soviet Union.

The Soviet Union has in the past year increased its long-range missile capabilities. It has begun to place near Moscow a limited antimissile defense. My first responsibility to our people is to assure that no nation can ever find it rational to launch a nuclear attack or to use its nuclear power as a credible threat against us or against our allies.

I would emphasize that that is why an important link between Russia and the United States is in our common interest, in arms control and in disarmament. We have the solemn duty to slow down the arms race between us, if that is at all possible, in both conventional and nuclear weapons and defenses. I thought we were making some progress in that direction the first few months I was in office. I realize that any additional race would impose on our peoples, and on all mankind, for that matter, an additional waste of resources with no gain in security to either side.

I expect in the days ahead to closely consult and seek the advice of the Congress about the possibilities of international agreements bearing directly upon this problem.

Next to the pursuit of peace, the really greatest challenge to the human family is the race between food supply and population increase. That race tonight is being lost.

The time for rhetoric has clearly passed. The time for concerted action is here and we must get on with the job.

We believe that three principles must prevail if our policy is to succeed:

First, the developing nations must give highest priority to food production, including the use of technology and the capital of private enterprise.

Second, nations with food deficits must put more of their resources into voluntary family planning programs.

And third, the developed nations must all assist other nations to avoid starvation in the short run and to move rapidly towards the ability to feed themselves.

Every member of the world community now bears a direct responsibility to help bring our most basic human account into balance. IV.

I come now finally to Southeast Asia—and to Vietnam in particular. Soon I will submit to the Congress a detailed report on that situation. Tonight I want to just review the essential points as briefly as I can.

We are in Vietnam because the United States of America and our allies are committed by the SEATO Treaty to "act to meet the common danger" of aggression in Southeast Asia.

We are in Vietnam because an international agreement signed by the United States, North Vietnam, and others in 1962 is being systematically violated by the Communists. That violation threatens the independence of all the small nations in Southeast Asia, and threatens the peace of the entire region and perhaps the world.

We are there because the people of South Vietnam have as much right to remain non-Communist—if that is what they choose—as North Vietnam has to remain Communist.

We are there because the Congress has pledged by solemn vote to take all necessary measures to prevent further aggression.

No better words could describe our present course than those once spoken by the great Thomas Jefferson:

"It is the melancholy law of human societies to be compelled sometimes to choose a great evil in order to ward off a greater."

We have chosen to fight a limited war in Vietnam in an attempt to prevent a larger war—a war almost certain to follow, I believe, if the Communists succeed in overrunning and taking over South Vietnam by aggression and by force. I believe, and I am supported by some authority, that if they are not checked now the world can expect to pay a greater price to check them later.

That is what our statesmen said when they debated this treaty, and that is why it was ratified 82 to 1 by the Senate many years ago.

You will remember that we stood in Western Europe 20 years ago. Is there anyone in this Chamber tonight who doubts that the course of freedom was not changed for the better because of the courage of that stand?

Sixteen years ago we and others stopped another kind of aggression—this time it was in Korea. Imagine how different Asia might be today if we had failed to act when the Communist army of North Korea marched south. The Asia of tomorrow will be far different because we have said in Vietnam, as we said 16 years ago in Korea: "This far and no further."

I think I reveal no secret when I tell you that we are dealing with a stubborn adversary who is committed to the use of force and terror to settle political questions.

I wish I could report to you that the conflict is almost over. This I cannot do. We face more cost, more loss, and more agony. For the end is not yet. I cannot promise you that it will come this year—or come next year. Our adversary still believes, I think, tonight, that he can go on fighting longer than we can, and longer than we and our allies will be prepared to stand up and resist.

Our men in that area—there are nearly 500,000 now—have borne well "the burden and the heat of the day." Their efforts have deprived the Communist enemy of the victory that he sought and that he expected a year ago. We have steadily frustrated his main forces. General Westmoreland reports that the enemy can no longer succeed on the battlefield.

So I must say to you that our pressure must be sustained—and will be sustained—until he realizes that the war he started is costing him more than he can ever gain.

I know of no strategy more likely to attain that end than the strategy of "accumulating slowly, but inexorably, every kind of material resource"—of "laboriously teaching troops the very elements of their trade." That, and patience—and I mean a great deal of patience.

Our South Vietnamese allies are also being tested tonight. Because they must provide real security to the people living in the countryside. And this means reducing the terrorism and the armed attacks which kidnaped and killed 26,900 civilians in the last 32 months, to levels where they can be successfully controlled by the regular South Vietnamese security forces. It means bringing to the villagers an effective civilian government that they can respect, and that they can rely upon and that they can participate in, and that they can have a personal stake in. We hope that government is now beginning to emerge.

While I cannot report the desired progress in the pacification effort, the very distinguished and able Ambassador, Henry Cabot Lodge, reports that South Vietnam is turning to this task with a new sense of urgency. We can help, but only they can win this part of the war. Their task is to build and protect a new life in each rural province.

One result of our stand in Vietnam is already clear.

It is this: The peoples of Asia now know that the door to independence is not going to be slammed shut. They know that it is possible for them to choose their own national destinies—without coercion.

The performance of our men in Vietnam—backed by the American people—has created a feeling of confidence and unity among the independent nations of Asia and the Pacific. I saw it in their faces in the 19 days that I spent in their homes and in their countries. Fear of external Communist conquest in many Asian nations is already subsiding—and with this, the spirit of hope is rising. For the first time in history, a common outlook and common institutions are already emerging.

This forward movement is rooted in the ambitions and the interests of Asian nations themselves. It was precisely this movement that we hoped to accelerate when I spoke at Johns Hopkins in Baltimore in April 1965, and I pledged "a much more massive effort to improve the life of man" in that part of the world, in the hope that we could take some of the funds that we were spending on bullets and bombs and spend it on schools and production.

Twenty months later our efforts have produced a new reality: The doors of the billion dollar Asian Development Bank that I recommended to the Congress, and you endorsed almost unanimously, I am proud to tell you are already open. Asians are engaged tonight in regional efforts in a dozen new directions. Their hopes are high. Their faith is strong. Their confidence is deep.

And even as the war continues, we shall play our part in carrying forward this constructive historic development. As recommended by the Eugene Black mission, and if other nations will join us, I will seek a special authorization from the Congress of $200 million for East Asian regional programs.

We are eager to turn our resources to peace. Our efforts in behalf of humanity I think need not be restricted by any parallel or by any boundary line. The moment that peace comes, as I pledged in Baltimore, I will ask the Congress for funds to join in an international program of reconstruction and development for all the people of Vietnam—and their deserving neighbors who wish our help.

We shall continue to hope for a reconciliation between the people of Mainland China and the world community—including working together in all the tasks of arms control, security, and progress on which the fate of the Chinese people, like their fellow men elsewhere, depends.

We would be the first to welcome a China which decided to respect her neighbors' rights. We would be the first to applaud her were she to apply her great energies and intelligence to improving the welfare of her people. And we have no intention of trying to deny her legitimate needs for security and friendly relations with her neighboring countries.

Our hope that all of this will someday happen rests on the conviction that we, the American people and our allies, will and are going to see Vietnam through to an honorable peace.

We will support all appropriate initiatives by the United Nations, and others, which can bring the several parties together for unconditional discussions of peace—anywhere, any time. And we will continue to take every possible initiative ourselves to constantly probe for peace.

Until such efforts succeed, or until the infiltration ceases, or until the conflict subsides, I think the course of wisdom for this country is that we just must firmly pursue our present course. We will stand firm in Vietnam.

I think you know that our fighting men there tonight bear the heaviest burden of all. With their lives they serve their Nation. We must give them nothing less than our full support—and we have given them that—nothing less than the determination that Americans have always given their fighting men. Whatever our sacrifice here, even if it is more than $5 a month, it is small compared to their own.

How long it will take I cannot prophesy. I only know that the will of the American people, I think, is tonight being tested.

Whether we can fight a war of limited objectives over a period of time, and keep alive the hope of independence and stability for people other than ourselves; whether we can continue to act with restraint when the temptation to "get it over with" is inviting but dangerous; whether we can accept the necessity of choosing "a great evil in order to ward off a greater"; whether we can do these without arousing the hatreds and the passions that are ordinarily loosed in time of war—on all these questions so much turns.

The answers will determine not only where we are, but "whither we are tending."

A time of testing—yes. And a time of transition. The transition is sometimes slow; sometimes unpopular; almost always very painful; and often quite dangerous.

But we have lived with danger for a long time before, and we shall live with it for a long time yet to come. We know that "man is born unto trouble." We also know that this Nation was not forged and did not survive and grow and prosper without a great deal of sacrifice from a great many men.

For all the disorders that we must deal with, and all the frustrations that concern us, and all the anxieties that we are called upon to resolve, for all the issues we must face with the agony that attends them, let us remember that "those who expect to reap the blessings of freedom must, like men, undergo the fatigues of supporting it."

But let us also count not only our burdens but our blessings—for they are many.

And let us give thanks to the One who governs us all.

Let us draw encouragement from the signs of hope—for they, too, are many.

Let us remember that we have been tested before and America has never been found wanting.

So with your understanding, I would hope your confidence, and your support, we are going to persist—and we are going to succeed.

***

State of the Union Address Lyndon B. Johnson January 17, 1968

Mr. Speaker, Mr. President, Members of the Congress, and my fellow Americans:

I was thinking as I was walking down the aisle tonight of what Sam Rayburn told me many years ago: The Congress always extends a very warm welcome to the President—as he comes in.

Thank all of you very, very much.

I have come once again to this Chamber—the home of our democracy—to give you, as the Constitution requires, "Information of the State of the Union."

I report to you that our country is challenged, at home and abroad:

—that it is our will that is being tried, not our strength; our sense of purpose, not our ability to achieve a better America;

—that we have the strength to meet our every challenge; the physical strength to hold the course of decency and compassion at home; and the moral strength to support the cause of peace in the world.

And I report to you that I believe, with abiding conviction, that this people—nurtured by their deep faith, tutored by their hard lessons, moved by their high aspirations—have the will to meet the trials that these times impose.

Since I reported to you last January:

—Three elections have been held in Vietnam—in the midst of war and under the constant threat of violence.

—A President, a Vice President, a House and Senate, and village officials have been chosen by popular, contested ballot.

—The enemy has been defeated in battle after battle.

—The number of South Vietnamese living in areas under Government protection tonight has grown by more than a million since January of last year.

These are all marks of progress. Yet:

—The enemy continues to pour men and material across frontiers and into battle, despite his continuous heavy losses.

—He continues to hope that America's will to persevere can be broken. Well—he is wrong. America will persevere. Our patience and our perseverance will match our power. Aggression will never prevail.

But our goal is peace—and peace at the earliest possible moment.

Right now we are exploring the meaning of Hanoi's recent statement. There is no mystery about the questions which must be answered before the bombing is stopped.

We believe that any talks should follow the San Antonio formula that I stated last September, which said:

—The bombing would stop immediately if talks would take place promptly and with reasonable hopes that they would be productive.

—And the other side must not take advantage of our restraint as they have in the past. This Nation simply cannot accept anything less without jeopardizing the lives of our men and of our allies.

If a basis for peace talks can be established on the San Antonio foundations—and it is my hope and my prayer that they can—we would consult with our allies and with the other side to see if a complete cessation of hostilities—a really true cease-fire—could be made the first order of business. I will report at the earliest possible moment the results of these explorations to the American people.

I have just recently returned from a very fruitful visit and talks with His Holiness the Pope and I share his hope—as he expressed it earlier today—that both sides will extend themselves in an effort to bring an end to the war in Vietnam. I have today assured him that we and our allies will do our full part to bring this about.

Since I spoke to you last January, other events have occurred that have major consequences for world peace.

—The Kennedy Round achieved the greatest reduction in tariff barriers in all the history of trade negotiations.

—The nations of Latin America at Punta del Este resolved to move toward economic integration.

—In Asia, the nations from Korea and Japan to Indonesia and Singapore worked behind America's shield to strengthen their economies and to broaden their political cooperation.

—In Africa, from which the distinguished Vice President has just returned, he reports to me that there is a spirit of regional cooperation that is beginning to take hold in very practical ways.

These events we all welcomed. Yet since I last reported to you, we and the world have been confronted by a number of crises:

—During the Arab-Israeli war last June, the hot line between Washington and Moscow was used for the first time in our history. A cease-fire was achieved without a major power confrontation.

Now the nations of the Middle East have the opportunity to cooperate with Ambassador Jarring's U.N. mission and they have the responsibility to find the terms of living together in stable peace and dignity, and we shall do all in our power to help them achieve that result.

—Not far from this scene of conflict, a crisis flared on Cyprus involving two peoples who are America's friends: Greece and Turkey. Our very able representative, Mr. Cyrus Vance, and others helped to ease this tension.

—Turmoil continues on the mainland of China after a year of violent disruption. The radical extremism of their Government has isolated the Chinese people behind their own borders. The United States, however, remains willing to permit the travel of journalists to both our countries; to undertake cultural and educational exchanges; and to talk about the exchange of basic food crop materials.

Since I spoke to you last, the United States and the Soviet Union have taken several important steps toward the goal of international cooperation.

As you will remember, I met with Chairman Kosygin at Glassboro and we achieved if not accord, at least a clearer understanding of our respective positions after 2 days of meeting.

Because we believe the nuclear danger must be narrowed, we have worked with the Soviet Union and with other nations to reach an agreement that will halt the spread of nuclear weapons. On the basis of communications from Ambassador Fisher in Geneva this afternoon, I am encouraged to believe that a draft treaty can be laid before the conference in Geneva in the very near future. I hope to be able to present that treaty to the Senate this year for the Senate's approval.

We achieved, in 1967, a consular treaty with the Soviets, the first commercial air agreement between the two countries, and a treaty banning weapons in outer space. We shall sign, and submit to the Senate shortly, a new treaty with the Soviets and with others for the protection of astronauts.

Serious differences still remain between us, yet in these relations, we have made some progress since Vienna, the Berlin Wall, and the Cuban missile crisis.

But despite this progress, we must maintain a military force that is capable of deterring any threat to this Nation's security, whatever the mode of aggression. Our choices must not be confined to total war—or to total acquiescence.

We have such a military force today. We shall maintain it.

I wish—with all of my heart—that the expenditures that are necessary to build and to protect our power could all be devoted to the programs of peace. But until world conditions permit, and until peace is assured, America's might—and America's bravest sons who wear our Nation's uniform—must continue to stand guard for all of us—as they gallantly do tonight in Vietnam and other places in the world.

Yet neither great weapons nor individual courage can provide the conditions of peace.

For two decades America has committed itself against the tyranny of want and ignorance in the world that threatens the peace. We shall sustain that commitment. This year I shall propose:

—That we launch, with other nations, an exploration of the ocean depths to tap its wealth, and its energy, and its abundance.

—That we contribute our fair share to a major expansion of the International Development Association, and to increase the resources of the Asian Development Bank.

—That we adopt a prudent aid program, rooted in the principle of self-help.

—That we renew and extend the food for freedom program.

Our food programs have already helped millions avoid the horrors of famine.

But unless the rapid growth of population in developing countries is slowed, the gap between rich and poor will widen steadily.

Governments in the developing countries must take such facts into consideration. We in the United States are prepared to help assist them in those efforts.

But we must also improve the lives of children already born in the villages and towns and cities on this earth. They can be taught by great teachers through space communications and the miracle of satellite television—and we are going to bring to bear every resource of mind and technology to help make this dream come true.

Let me speak now about some matters here at home.

Tonight our Nation is accomplishing more for its people than has ever been accomplished before. Americans are prosperous as men have never been in recorded history. Yet there is in the land a certain restlessness—a questioning.

The total of our Nation's annual production is now above $800 billion. For 83 months this Nation has been on a steady upward trend of growth.

All about them, most American families can see the evidence of growing abundance: higher paychecks, humming factories, new cars moving down new highways. More and more families own their own homes, equipped with more than 70 million television sets.

A new college is founded every week. Today more than half of the high school graduates go on to college.

There are hundreds of thousands of fathers and mothers who never completed grammar school—who will see their children graduate from college.

Why, then, this restlessness?

Because when a great ship cuts through the sea, the waters are always stirred and troubled.

And our ship is moving. It is moving through troubled and new waters; it is moving toward new and better shores.

We ask now, not how can we achieve abundance?—but how shall we use our abundance? Not, is there abundance enough for all?—but, how can all share in our abundance?

While we have accomplished much, much remains for us to meet and much remains for us to master.

—In some areas, the jobless rate is still three or four times the national average.

—Violence has shown its face in some of our cities.

—Crime increases on our streets.

—Income for farm workers remains far behind that for urban workers; and parity for our farmers who produce our food is still just a hope—not an achievement.

—New housing construction is far less than we need—to assure decent shelter for every family.

—Hospital and medical costs are high, and they are rising.

—Many rivers—and the air in many cities—remain badly polluted. And our citizens suffer from breathing that air.

We have lived with conditions like these for many, many years. But much that we once accepted as inevitable, we now find absolutely intolerable.

In our cities last summer, we saw how wide is the gulf for some Americans between the promise and the reality of our society.

We know that we cannot change all of this in a day. It represents the bitter consequences of more than three centuries.

But the issue is not whether we can change this; the issue is whether we will change this.

Well, I know we can. And I believe we will.

This then is the work we should do in the months that are ahead of us in this Congress.

The first essential is more jobs, useful jobs for tens of thousands who can become productive and can pay their own way.

Our economy has created 7 1/2 million new jobs in the past 4 years. It is adding more than a million and a half new jobs this year.

Through programs passed by the Congress, job training is being given tonight to more than a million Americans in this country.

This year, the time has come when we must get to those who are last in line—the hard-core unemployed—the hardest to reach.

Employment officials estimate that 500,000 of these persons are now unemployed in the major cities of America. Our objective is to place these 500,000 in private industry jobs within the next 3 years.

To do this, I propose a $2. 1 billion manpower program in the coming fiscal year—a 25 percent increase over the current year. Most of this increase will be used to start a new partnership between government and private industry to train and to hire the hard-core unemployed persons. I know of no task before us of more importance to us, to the country, or to our future.

Another essential is to rebuild our cities.

Last year the Congress authorized $662 million for the Model Cities program. I requested the full amount of that authorization to help meet the crisis in the cities of America. But the Congress appropriated only $312 million—less than half.

This year I urge the Congress to honor my request for model cities funds to rebuild the centers of American cities by granting us the full amount that you in the Congress authorized—$1 billion.

The next essential is more housing—and more housing now.

Surely a nation that can go to the moon can place a decent home within the reach of its families.

Therefore we must call together the resources of industry and labor, to start building 300,000 housing units for low- and middle-income families next year—that is three times more than this year. We must make it possible for thousands of families to become homeowners, not rent-payers.

I propose, for the consideration of this Congress, a 10-year campaign to build 6 million new housing units for low and middle-income families. Six million units in the next 10 years. We have built 530,000 the last 10 years.

Better health for our children—all of our children—is essential if we are to have a better America.

Last year, Medicare, Medicaid, and other new programs that you passed in the Congress brought better health to more than 25 million Americans.

American medicine—with the very strong support and cooperation of public resources—has produced a phenomenal decline in the death rate from many of the dread diseases.

But it is a shocking fact that, in saving the lives of babies, America ranks 15th among the nations of the world. And among children, crippling defects are often discovered too late for any corrective action. This is a tragedy that Americans can, and Americans should, prevent.

I shall, therefore, propose to the Congress a child health program to provide, over the next 5 years, for families unable to afford it—access to health services from prenatal care of the mother through the child's first year.

When we do that you will find it is the best investment we ever made because we will get these diseases in their infancy and we will find a cure in a great many instances that we can never find by overcrowding our hospitals when they are grown.

Now when we act to advance the consumer's cause I think we help every American.

Last year, with very little fanfare the Congress and the executive branch moved in that field.

We enacted the Wholesome Meat Act, the Flammable Fabrics Act, the Product Safety Commission, and a law to improve clinical laboratories.

And now, I think, the time has come to complete our unfinished work. The Senate has already passed the truth-in-lending bill, the fire safety bill, and the pipeline safety laws.

Tonight I plead with the House to immediately act upon these measures and I hope take favorable action upon all of them. I call upon the Congress to enact, without delay, the remainder of the 12 vital consumer protection laws that I submitted to the Congress last year.

I also urge final action on a measure that is already passed by the House to guard against fraud and manipulation in the Nation's commodity exchange market.

These measures are a pledge to our people—to keep them safe in their homes and at work, and to give them a fair deal in the marketplace.

And I think we must do more. I propose:

—New powers for the Federal Trade Commission to stop those who defraud and who swindle our public.

—New safeguards to insure the quality of fish and poultry, and the safety of our community water supplies.

—A major study of automobile insurance.

—Protection against hazardous radiation from television sets and other electronic equipment.

And to give the consumer a stronger voice, I plan to appoint a consumer counsel in the Justice Department—a lawyer for the American consumer—to work directly under the Attorney General, to serve the President's Special Assistant for Consumer Affairs, and to serve the consumers of this land.

This Congress—Democrats and Republicans—can earn the thanks of history. We can make this truly a new day for the American consumer, and by giving him this protection we can live in history as the consumer-conscious Congress.

So let us get on with the work. Let us act soon.

We, at every level of the government, State, local, Federal, know that the American people have had enough of rising crime and lawlessness in this country.

They recognize that law enforcement is first the duty of local police and local government.

They recognize that the frontline headquarters against crime is in the home, the church, the city hall and the county courthouse and the statehouse—not in the far-removed National Capital of Washington.

But the people also recognize that the National Government can and the National Government should help the cities and the States in their war on crime to the full extent of its resources and its constitutional authority. And this we shall do.

This does not mean a national police force. It does mean help and financial support:

—to develop State and local master plans to combat crime,

—to provide better training and better pay for police, and

—to bring the most advanced technology to the war on crime in every city and every county in America.

There is no more urgent business before this Congress than to pass the Safe Streets Act this year that I proposed last year. That law will provide these required funds. They are so critically needed that I have doubled my request under this act to $100 million in fiscal 1969.

And I urge the Congress to stop the trade in mail-order murder, to stop it this year by adopting a proper gun control law.

This year, I will propose a Drug Control Act to provide stricter penalties for those who traffic in LSD and other dangerous drugs with our people.

I will ask for more vigorous enforcement of all of our drug laws by increasing the number of Federal drug and narcotics control officials by more than 30 percent. The time has come to stop the sale of slavery to the young. I also request you to give us funds to add immediately 100 assistant United States attorneys throughout the land to help prosecute our criminal laws. We have increased our judiciary by 40 percent and we have increased our prosecutors by 16 percent. The dockets are full of cases because we don't have assistant district attorneys to go before the Federal judge and handle them. We start these young lawyers at $8,200 a year. And the docket is clogged because we don't have authority to hire more of them.

I ask the Congress for authority to hire 100 more. These young men will give special attention to this drug abuse, too.

Finally, I ask you to add 100 FBI agents to strengthen law enforcement in the Nation and to protect the individual rights of every citizen.

A moment ago I spoke of despair and frustrated hopes in the cities where the fires of disorder burned last summer. We can—and in time we will—change that despair into confidence, and change those frustrations into achievements. But violence will never bring progress.

We can make progress only by attacking the causes of violence and only where there is civil order founded on justice.

Today we are helping local officials improve their capacity to deal promptly with disorders.

Those who preach disorder and those who preach violence must know that local authorities are able to resist them swiftly, to resist them sternly, and to resist them decisively.

I shall recommend other actions:

—To raise the farmers' income by establishing a security commodity reserve that will protect the market from price-depressing stocks and protect the consumer from food scarcity.

—I shall recommend programs to help farmers bargain more effectively for fair prices.

—I shall recommend programs for new air safety measures.

—Measures to stem the rising costs of medical care.

—Legislation to encourage our returning veterans to devote themselves to careers in community service such as teaching, and being firemen, and joining our police force, and our law enforcement officials.

—I shall recommend programs to strengthen and finance our anti-pollution efforts.

—Fully funding all of the $2.18 billion poverty program that you in the Congress had just authorized in order to bring opportunity to those who have been left far behind.

—I shall recommend an Educational Opportunity Act to speed up our drive to break down the financial barriers that are separating our young people from college.

I shall also urge the Congress to act on several other vital pending bills—especially the civil rights measures—fair jury trials, protection of Federal rights, enforcement of equal employment opportunity, and fair housing.

The unfinished work of the first session must be completed—the Higher Education Act, the Juvenile Delinquency Act, conservation measures to save the redwoods of California, and to preserve the wonders of our scenic rivers, the Highway Beautification Act—and all the other measures for a cleaner, and for a better, and for a more beautiful America.

Next month we'll begin our 8th year of uninterrupted prosperity. The economic outlook for this year is one of steady growth—if we are vigilant.

True, there are some clouds on the horizon. Prices are rising. Interest rates have passed the peak of 1966; and if there is continued inaction on the tax bill, they will climb even higher.

I warn the Congress and the Nation tonight that this failure to act on the tax bill will sweep us into an accelerating spiral of price increases, a slump in homebuilding, and a continuing erosion of the American dollar.

This would be a tragedy for every American family. And I predict that if this happens, they will all let us know about it.

We—those of us in the executive branch, in the Congress, and the leaders of labor and business—must do everything we can to prevent that kind of misfortune.

Under the new budget, the expenditures for 1969 will increase by $10.4 billion. Receipts will increase by $22.3 billion including the added tax revenues. Virtually all of this expenditure increase represents the mandatory cost of our defense efforts, $3 billion; increased interest, almost $1 billion; or mandatory payments under laws passed by Congress—such as those provided in the Social Security Act that you passed in 1967, and to Medicare and Medicaid beneficiaries, veterans, and farmers, of about $4 1/2 billion; and the additional $1 billion 600 million next year for the pay increases that you passed in military and civilian pay. That makes up the $10 billion that is added to the budget. With few exceptions, very few, we are holding the fiscal 1969 budget to last year's level, outside of those mandatory and required increases.

A Presidential commission composed of distinguished congressional fiscal leaders and other prominent Americans recommended this year that we adopt a new budget approach. I am carrying out their recommendations in this year's budget. This budget, therefore, for the first time accurately covers all Federal expenditures and all Federal receipts, including for the first time in one budget $47 billion from the social security, Medicare, highway, and other trust funds.

The fiscal 1969 budget has expenditures of approximately $186 billion, with total estimated revenues, including the tax bill, of about $178 billion.

If the Congress enacts the tax increase, we will reduce the budget deficit by some $12 billion. The war in Vietnam is costing us about $25 billion and we are asking for about $12 billion in taxes—and if we get that $12 billion tax bill we will reduce the deficit from about $20 billion in 1968 to about $8 billion in 1969.

Now, this is a tight budget. It follows the reduction that I made in cooperation with the Congress—a reduction made after you had reviewed every appropriations bill and reduced the appropriations by some $5 or $6 billion and expenditures by $1.5 billion. We conferred together and I recommended to the Congress and you subsequently approved taking 2 percent from payrolls and 10 percent from controllable expenditures. We therefore reduced appropriations almost $10 billion last session and expenditures over $4 billion. Now, that was in the budget last year.

I ask the Congress to recognize that there are certain selected programs that meet the Nation's most urgent needs and they have increased. We have insisted that decreases in very desirable but less urgent programs be made before we would approve any increases. So I ask the Congress tonight:

—to hold its appropriations to the budget requests, and

—to act responsibly early this year by enacting the tax surcharge which for the average American individual amounts to about a penny out of each dollar's income.

This tax increase would yield about half of the $23 billion per year that we returned to the people in the tax reduction bills of 1964 and 1965.

This must be a temporary measure, which expires in less than 2 years. Congress can repeal it sooner if the need has passed. But Congress can never repeal inflation.

The leaders of American business and the leaders of American labor—those who really have power over wages and prices—must act responsibly, and in their Nation's interest by keeping increases in line with productivity. If our recognized leaders do not do this, they and those for whom they speak and all of us are going to suffer very serious consequences.

On January 1st, I outlined a program to reduce our balance of payments deficit sharply this year. We will ask the Congress to help carry out those parts of the program which require legislation. We must restore equilibrium to our balance of payments.

We must also strengthen the international monetary system. We have assured the world that America's full gold stock stands behind our commitment to maintain the price of gold at $35 an ounce. We must back this commitment by legislating now to free our gold reserves.

Americans, traveling more than any other people in history, took $4 billion out of their country last year in travel costs. We must try to reduce the travel deficit that we have of more than $2 billion. We are hoping that we can reduce it by $500 million—without unduly penalizing the travel of teachers, students, business people who have essential and necessary travel, or people who have relatives abroad whom they want to see. Even with this reduction of $500 million, the American people will still be traveling more overseas than they did in 1967, 1966, or 1965 or any other year in their history.

If we act together as I hope we can, I believe we can continue our economic expansion which has already broken all past records. And I hope that we can continue that expansion in the days ahead.

Each of these questions I have discussed with you tonight is a question of policy for our people. Therefore, each of them should be—and doubtless will be—debated by candidates for public office this year.

I hope those debates will be marked by new proposals and by a seriousness that matches the gravity of the questions themselves.

These are not appropriate subjects for narrow partisan oratory. They go to the heart of what we Americans are all about—all of us, Democrats and Republicans.

Tonight I have spoken of some of the goals I should like to see America reach. Many of them can be achieved this year—others by the time we celebrate our Nation's 200th birthday—the bicentennial of our independence.

Several of these goals are going to be very hard to reach. But the State of our Union will be much stronger 8 years from now on our 200th birthday if we resolve to reach these goals now. They are more important—much more important—than the identity of the party or the President who will then be in office.

These goals are what the fighting and our alliances are really meant to protect.

Can we achieve these goals?

Of course we can—if we will.

If ever there was a people who sought more than mere abundance, it is our people.

If ever there was a nation that was capable of solving its problems, it is this Nation.

If ever there were a time to know the pride and the excitement and the hope of being an American—it is this time.

So this, my friends, is the State of our Union: seeking, building, tested many times in this past year—and always equal to the test.

Thank you and good night.

***

State of the Union Address Lyndon B. Johnson January 14, 1969

Mr. Speaker, Mr. President, Members of the Congress and my fellow Americans:

For the sixth and the last time, I present to the Congress my assessment of the State of the Union.

I shall speak to you tonight about challenge and opportunity—and about the commitments that all of us have made together that will, if we carry them out, give America our best chance to achieve the kind of great society that we all want. Every President lives, not only with what is, but with what has been and what could be.

Most of the great events in his Presidency are part of a larger sequence extending back through several years and extending back through several other administrations.

Urban unrest, poverty, pressures on welfare, education of our people, law enforcement and law and order, the continuing crisis in the Middle East, the conflict in Vietnam, the dangers of nuclear war, the great difficulties of dealing with the Communist powers, all have this much in common: They and their causes—the causes that gave rise to them—all of these have existed with us for many years. Several Presidents have already sought to try to deal with them. One or more Presidents will try to resolve them or try to contain them in the years that are ahead of us.

But if the Nation's problems are continuing, so are this great Nation's assets:

—our economy,

—the democratic system,

—our sense of exploration, symbolized most recently by the wonderful flight of the Apollo 8, in which all Americans took great pride,

—the good commonsense and sound judgment of the American people, and

—their essential love of justice.

We must not ignore our problems. But .neither should we ignore our strengths. Those strengths are available to sustain a President of either party—to support his progressive efforts both at home and overseas.

Unfortunately, the departure of an administration does not mean the end of the problems that this administration has faced. The effort to meet the problems must go on, year after year, if the momentum that we have all mounted together in these past years is not to be lost.

Although the struggle for progressive change is continuous, there are times when a watershed is reached—when there is—if not really a break with the past—at least the fulfillment of many of its oldest hopes, and a stepping forth into a new environment, to seek new goals. I think the past 5 years have been such a time.

We have finished a major part of the old agenda.

Some of the laws that we wrote have already, in front of our eyes, taken on the flesh of achievement.

Medicare that we were unable to pass for so many years is now a part of American life.

Voting rights and the voting booth that we debated so long back in the riffles, and the doors to public service, are open at last to all Americans regardless of their color.

Schools and school children all over America tonight are receiving Federal assistance to go to good schools.

Preschool education—Head Start—is already here to stay and, I think, so are the Federal programs that tonight are keeping more than a million and a half of the cream of our young people in the colleges and the universities of this country.

Part of the American earth—not only in description on a map, but in the reality of our shores, our hills, our parks, our forests, and our mountains—has been permanently set aside for the American public and for their benefit. And there is more that will be set aside before this administration ends.

Five million Americans have been trained for jobs in new Federal programs.

I think it is most important that we all realize tonight that this Nation is close to full employment—with less unemployment than we have had at any time in almost 20 years. That is not in theory; that is in fact. Tonight, the unemployment rate is down to 3.3 percent. The number of jobs has grown more than 8 1/2 million in the last 5 years. That is more than in all the preceding 12 years.

These achievements completed the full cycle, from idea to enactment and, finally, to a place in the lives of citizens all across this country.

I wish it were possible to say that everything that this Congress and the administration achieved during this period had already completed that cycle. But a great deal of what we have committed needs additional funding to become a tangible realization.

Yet the very existence of these commitments—these promises to the American people, made by this Congress and by the executive branch of the Government—are achievements in themselves, and failure to carry through on our commitments would be a tragedy for this Nation.

This much is certain: No one man or group of men made these commitments alone. Congress and the executive branch, with their checks and balances, reasoned together and finally wrote them into the law of the land. They now have all the moral force that the American political system can summon when it acts as one.

They express America's common determination to achieve goals. They imply action.

In most cases, you have already begun that action—but it is not fully completed, of course.

Let me speak for a moment about these commitments. I am going to speak in the language which the Congress itself spoke when it passed these measures. I am going to quote from your words.

In 1966, Congress declared that "improving the quality of urban life is the most critical domestic problem facing the United States." Two years later it affirmed the historic goal of "a decent home . . . for every American family." That is your language.

Now to meet these commitments, we must increase our support for the model cities program, where blueprints of change are already being prepared in more than 150 American cities.

To achieve the goals of the Housing Act of 1968 that you have already passed, we should begin this year more than 500,000 homes for needy families in the coming fiscal year. Funds are provided in the new budget to do just this. This is almost 10 times—10 times—the average rate of the past 10 years.

Our cities and our towns are being pressed for funds to meet the needs of their growing populations. So I believe an urban development bank should be created by the Congress. This bank could obtain resources through the issuance of taxable bonds and it could then lend these resources at reduced rates to the communities throughout the land for schools, hospitals, parks, and other public facilities.

Since we enacted the Social Security Act back in 1935, Congress has recognized the necessity to "make more adequate provision for aged persons . . . through maternal and child welfare . . . and public health." Those are the words of the Congress—"more adequate."

The time has come, I think, to make it more adequate. I believe we should increase social security benefits, and I am so recommending tonight.

I am suggesting that there should be an overall increase in benefits of at least 13 percent. Those who receive only the minimum of $55 should get $80 a month.

Our Nation, too, is rightfully proud of our medical advances. But we should remember that our country ranks 15th among the nations of the world in its infant mortality rate.

I think we should assure decent medical care for every expectant mother and for their children during the first year of their life in the United States of America.

I think we should protect our children and their families from the costs of catastrophic illness.

As we pass on from medicine, I think nothing is clearer to the Congress than the commitment that the Congress made to end poverty. Congress expressed it well, I think, in 1964, when they said: "It is the policy of the United States to eliminate the paradox of poverty in the midst of plenty in this nation."

This is the richest nation in the world. The antipoverty program has had many achievements. It also has some failures. But we must not cripple it after only 3 years of trying to solve the human problems that have been with us and have been building up among us for generations.

I believe the Congress this year will want to improve the administration of the poverty program by reorganizing portions of it and transferring them to other agencies. I believe, though, it will want to continue, until we have broken the back of poverty, the efforts we are now making throughout this land.

I believe, and I hope the next administration—I believe they believe—that the key to success in this effort is jobs. It is work for people who want to work.

In the budget for fiscal 1970, I shall recommend a total of $3.5 billion for our job training program, and that is five times as much as we spent in 1964 trying to prepare Americans where they can work to earn their own living.

The Nation's commitment in the field of civil rights began with the Declaration of Independence. They were extended by the 13th, 14th, and 15th amendments. They have been powerfully strengthened by the enactment of three far-reaching civil rights laws within the past 5 years, that this Congress, in its wisdom, passed.

On January 1 of this year, the Fair Housing Act of 1968 covered over 20 million American homes and apartments. The prohibition against racial discrimination in that act should be remembered and it should be vigorously enforced throughout this land.

I believe we should also extend the vital provisions of the Voting Rights Act for another 5 years.

In the Safe Streets Act of 1968, Congress determined "To assist state and local governments in reducing the incidence of crime."

This year I am proposing that the Congress provide the full $300 million that the Congress last year authorized to do just that.

I hope the Congress will put the money where the authorization is.

I believe this is an essential contribution to justice and to public order in the United States. I hope these grants can be made to the States and they can be used effectively to reduce the crime rate in this country.

But all of this is only a small part of the total effort that must be made—I think chiefly by the local governments throughout the Nation—if we expect to reduce the toll of crime that we all detest.

Frankly, as I leave the Office of the Presidency, one of my greatest disappointments is our failure to secure passage of a licensing and registration act for firearms. I think if we had passed that act, it would have reduced the incidence of crime. I believe that the Congress should adopt such a law, and I hope that it will at a not too distant date.

In order to meet our long-standing commitment to make government as efficient as possible, I believe that we should reorganize our postal system along the lines of the Kappel[1] report.

[Footnote 1: Frederick R. Kappel, Chairman of the Commission on Executive, Legislative and Judicial Salaries.]

I hope we can all agree that public service should never impose an unreasonable financial sacrifice on able men and women who want to serve their country.

I believe that the recommendations of the Commission on Executive, Legislative and Judicial Salaries are generally sound. Later this week, I shall submit a special message which I reviewed with the leadership this evening containing a proposal that has been reduced and has modified the Commission's recommendation to some extent on the congressional salaries.

For Members of Congress, I will recommend the basic compensation not of the $50,000 unanimously recommended by the Kappel Commission and the other distinguished Members, but I shall reduce that $50,000 to $42,500. I will suggest that Congress appropriate a very small additional allowance for official expenses, so that Members will not be required to use their salary increase for essential official business.

I would have submitted the Commission's recommendations, except the advice that I received from the leadership—and you usually are consulted about matters that affect the Congress—was that the Congress would not accept the $50,000 recommendation, and if I expected my recommendation to be seriously considered, I should make substantial reductions. That is the only reason I didn't go along with the Kappel report.

In 1967 I recommended to the Congress a fair and impartial random selection system for the draft. I submit it again tonight for your most respectful consideration.

I know that all of us recognize that most of the things we do to meet all of these commitments I talk about will cost money. If we maintain the strong rate of growth that we have had in this country for the past 8 years, I think we shall generate the resources that we need to meet these commitments.

We have already been able to increase our support for major social programs—although we have heard a lot about not being able to do anything on the home front because of Vietnam; but we have been able in the last 5 years to increase our commitments for such things as health and education from $30 billion in 1964 to $68 billion in the coming fiscal year. That is more than double. That is more than it has ever been increased in the 188 years of this Republic, notwithstanding Vietnam.

We must continue to budget our resources and budget them responsibly in a way that will preserve our prosperity and will strengthen our dollar.

Greater revenues and the reduced Federal spending required by Congress last year have changed the budgetary picture dramatically since last January when we made our estimates. At that time, you will remember that we estimated we would have a deficit of $8 billion. Well, I am glad to report to you tonight that the fiscal year ending June 30, 1969, this June, we are going to have not a deficit, but we are going to have a $2.4 billion surplus.

You will receive the budget tomorrow. The budget for the next fiscal year, that begins July 1—which you will want to examine very carefully in the days ahead—will provide a $3.4 billion surplus.

This budget anticipates the extension of the surtax that Congress enacted last year. I have communicated with the President-elect, Mr. Nixon, in connection with this policy of continuing the surtax for the time being.

I want to tell you that both of us want to see it removed just as soon as circumstances will permit, but the President-elect has told me that he has concluded that until his administration, and this Congress, can examine the appropriation bills, and each item in the budget, and can ascertain that the facts justify permitting the surtax to expire or to be reduced, he, Mr. Nixon, will support my recommendation that the surtax be continued.

Americans, I believe, are united in the hope that the Paris talks will bring an early peace to Vietnam. And if our hopes for an early settlement of the war are realized, then our military expenditures can be reduced and very substantial savings can be made to be used for other desirable purposes, as the Congress may determine.

In any event, I think it is imperative that we do all that we responsibly can to resist inflation while maintaining our prosperity. I think all Americans know that our prosperity is broad and it is deep, and it has brought record profits, the highest in our history, and record wages.

Our gross national product has grown more in the last 5 years than any other period in our Nation's history. Our wages have been the highest. Our profits have been the best. This prosperity has enabled millions to escape the poverty that they would have otherwise had the last few years.

I think also you will be very glad to hear that the Secretary of the Treasury informs me tonight that in 1968 in our balance of payments we have achieved a surplus. It appears that we have, in fact, done better this year than we have done in any year in this regard since the year 1957.

The quest for a durable peace, I think, has absorbed every administration since the end of World War II. It has required us to seek a limitation of arms races not only among the superpowers, but among the smaller nations as well. We have joined in the test ban treaty of 1963, the outer space treaty of 1967, and the treaty against the spread of nuclear weapons in 1968.

This latter agreement—the nonproliferation treaty—is now pending in the Senate and it has been pending there since last July. In my opinion, delay in ratifying it is not going to be helpful to the cause of peace. America took the lead in negotiating this treaty and America should now take steps to have it approved at the earliest possible date.

Until a way can be found to scale down the level of arms among the superpowers, mankind cannot view the future without fear and great apprehension. So, I believe that we should resume the talks with the Soviet Union about limiting offensive and defensive missile systems. I think they would already have been resumed except for Czechoslovakia and our election this year.

It was more than 20 years ago that we embarked on a program of trying to aid the developing nations. We knew then that we could not live in good conscience as a rich enclave on an earth that was seething in misery.

During these years there have been great advances made under our program, particularly against want and hunger, although we are disappointed at the appropriations last year. We thought they were woefully inadequate. This year I am asking for adequate funds for economic assistance in the hope that we can further peace throughout the world.

I think we must continue to support efforts in regional cooperation. Among those efforts, that of Western Europe has a very special place in America's concern.

The only course that is going to permit Europe to play the great world role that its resources permit is to go forward to unity. I think America remains ready to work with a united Europe, to work as a partner on the basis of equality.

For the future, the quest for peace, I believe, requires:

—that we maintain the liberal trade policies that have helped us become the leading nation in world trade,

—that we strengthen the international monetary system as an instrument of world prosperity, and

—that we seek areas of agreement with the Soviet Union where the interests of both nations and the interests of world peace are properly served.

The strained relationship between us and the world's leading Communist power has not ended—especially in the light of the brutal invasion of Czechoslovakia. But totalitarianism is no less odious to us because we are able to reach some accommodation that reduces the danger of world catastrophe.

What we do, we do in the interest of peace in the world. We earnestly hope that time will bring a Russia that is less afraid of diversity and individual freedom.

The quest for peace tonight continues in Vietnam, and in the Paris talks.

I regret more than any of you know that it has not been possible to restore peace to South Vietnam.

The prospects, I think, for peace are better today than at any time since North Vietnam began its invasion with its regular forces more than 4 years ago.

The free nations of Asia know what they were not sure of at that time: that America cares about their freedom, and it also cares about America's own vital interests in Asia and throughout the Pacific.

The North Vietnamese know that they cannot achieve their aggressive purposes by force. There may be hard fighting before a settlement is reached; but, I can assure you, it will yield no victory to the Communist cause.

I cannot speak to you tonight about Vietnam without paying a very personal tribute to the men who have carried the battle out there for all of us. I have been honored to be their Commander in Chief. The Nation owes them its unstinting support while the battle continues—and its enduring gratitude when their service is done.

Finally, the quest for stable peace in the Middle East goes on in many capitals tonight. America fully supports the unanimous resolution of the U.N. Security Council which points the way. There must be a settlement of the armed hostility that exists in that region of the world today. It is a threat not only to Israel and to all the Arab States, but it is a threat to every one of us and to the entire world as well.

Now, my friends in Congress, I want to conclude with a few very personal words to you.

I rejected and rejected and then finally accepted the congressional leadership's invitation to come here to speak this farewell to you in person tonight.

I did that for two reasons. One was philosophical. I wanted to give you my judgment, as I saw it, on some of the issues before our Nation, as I view them, before I leave.

The other was just pure sentimental. Most all of my life as a public official has been spent here in this building. For 38 years—since I worked on that gallery as a doorkeeper in the House of Representatives—I have known these halls, and I have known most of the men pretty well who walked them.

I know the questions that you face. I know the conflicts that you endure. I know the ideals that you seek to serve.

I left here first to become Vice President, and then to become, in a moment of tragedy, the President of the United States.

My term of office has been marked by a series of challenges, both at home and throughout the world.

In meeting some of these challenges, the Nation has found a new confidence. In meeting others, it knew turbulence and doubt, and fear and hate.

Throughout this time, I have been sustained by my faith in representative democracy—a faith that I had learned here in this Capitol Building as an employee and as a Congressman and as a Senator.

I believe deeply in the ultimate purposes of this Nation—described by the Constitution, tempered by history, embodied in progressive laws, and given life by men and women that have been elected to serve their fellow citizens.

Now for 5 most demanding years in the White House, I have been strengthened by the counsel and the cooperation of two great former Presidents, Harry S. Truman and Dwight David Eisenhower. I have been guided by the memory of my pleasant and close association with the beloved John F. Kennedy, and with our greatest modern legislator, Speaker Sam Rayburn.

I have been assisted by my friend every step of the way, Vice President Hubert Humphrey. I am so grateful that I have been supported daily by the loyalty of Speaker McCormack and Majority Leader Albert.

I have benefited from the wisdom of Senator Mike Mansfield, and I am sure that I have avoided many dangerous pitfalls by the good commonsense counsel of the President Pro Tem of the Senate, Senator Richard Brevard Russell.

I have received the most generous cooperation from the leaders of the Republican Party in the Congress of the United States, Senator Dirksen and Congressman Gerald Ford, the Minority Leader.

No President should ask for more, although I did upon occasions. But few Presidents have ever been blessed with so much.

President-elect Nixon, in the days ahead, is going to need your understanding, just as I did. And he is entitled to have it. I hope every Member will remember that the burdens he will bear as our President, will be borne for all of us. Each of us should try not to increase these burdens for the sake of narrow personal or partisan advantage.

Now, it is time to leave. I hope it may be said, a hundred years from now, that by working together we helped to make our country more just, more just for all of its people, as well as to insure and guarantee the blessings of liberty for all of our posterity.

That is what I hope. But I believe that at least it will be said that we tried.

THE END