AGENDA FOR AMERICAN RENEWAL I. Introduction: The Challenge America stands at the edge of a new era, a new century. Here is my bridge to the other shore: An Agenda for American Renewal -- diagnosing the economic problems we face, setting forth the principles to guide our actions, and explaining the approach I am pursuing. Over past weeks I have been discussing some of the elements of my economic agenda. In coming weeks I will be expanding on my ideas. This document shows how the pieces fit together. It is important to step back for a moment, to take stock of where we are as a great nation in the broader sweep of history. The American people have just completed the greatest mission of all, the triumph of democratic capitalism over imperialistic communism. Mission accomplished. Throughout history, when long wars end, people have been confronted with the problems of converting to peacetime and establishing a new basis for securing peace and prosperity. In wartime, the costs of Government are always high. Domestic needs are not fully met. In times of conflict, a good nation tries to look after its poor, its sick, its elderly, its less privileged members, but not as completely as it should or would like to. Today, this year, for the first time since December l94l, the United States is not engaged in a war, hot or cold. We are a nation at peace. But being at peace with others and being at peace with ourselves are different things. The one we have achieved. The other, we can and will. The American people recognize this historical watershed. They want and deserve a peacetime system of taxation, a peacetime freedom from unnecessary intrusion into our lives, a peacetime commitment to sound money, a peacetime dedication to unfinished work and unsolved problems close to home. At the same time, Americans are aware of epic changes in the world and the economy. They sense the disquiet in many of the industrialized democracies that have been our partners in the long struggle. Our own economy has been going through some profound changes. And I understand how difficult change can be, particularly for those who feel its effects most directly. Americans sense we face an era of great opportunity, but that there are also great risks if we fail to choose wisely. We must now demonstrate our unique ability to transform anxiety into regeneration. Only in America do we have the people, the resources, the economic strength -- and especially the principles and ideals -- to pick up the challenge. For America to be safe and strong we must meet the defining challenge of the '90s: to win the economic competition -- to win the peace. The United States must be a military superpower, an export superpower, and an economic superpower. My approach is to look forward -- to open new markets, prepare our people to compete, to strengthen the American family, to save and invest -- so we can win. This future depends on economic growth, but not for the few at the expense of the many, not for the present at the expense of the future. In this country, we have always preferred an entrepreneurial capitalism that grows from the bottom up, not the top down, a capitalism that begins on Main Street and extends to Wall Street, not the other way around. Nor have we been taken in by the view my opponent prefers, that Government should accumulate capital -- by taxing it and borrowing it from the people, and investing it according to some industrial policy design. My agenda is for an inclusive America, not an exclusive America -- and certainly not a reclusive one. We will challenge the world with an international economic and trade strategy that will promote free trade arrangements east and west, north and south, to strengthen our global economic reach and complement our worldwide security presence. At the same time, we need to foster the capabilities at home that will keep us in the lead. Developed economies need developing minds. To help prepare all our children for a constantly changing workplace, I want to make radical changes in our education system. Each child should graduate with skills, self-discipline, and self-confidence. I will sharpen the competitive edge of our businesses by encouraging entrepreneurial capitalism and small business, deploying advances in R&D and technology, and reforming our legal system so it no longer puts us at a global disadvantage. My agenda promotes economic security for working men and women through job training that will ease adjustments and provide people with new capabilities for work in the face of competition and change. And I will enable families to concentrate on building for the future by giving them the means to protect themselves against today's cost of health care, and by making it easier to build tomorrow's retirement security. I want our efforts to reach out to all our citizens, leaving no one behind, because we will need the work, aspiration, and energy of each and every American. Finally, since our competitive strength and entrepreneurial spirit must flow from the private sector, I will streamline Government to meet changing needs. We can empower America to reach a grand goal: a $l0 trillion economy by the first years of the 21st Century. When President Reagan and I assumed office in 1981, the U.S. economy was about $3 trillion. We've almost doubled that over the past 12 years. So I know we can nearly double it again through sustainable real growth over the coming decade. With a $10 trillion economy, we could provide the resources, private and public, to satisfy our most ambitious social and financial requirements. We could simultaneously renew America and pay down our national debt. So now let me turn to how we can meet the challenge and reach our goal. II. The Context: Five Changes Underway in the Economy The U.S. economy has been working its way through five profound changes. They establish the context for my agenda. The first great change in our economy is ironically due to our very success in ending the Cold War. Since our superpower rival of the last half century has dropped out of the race, we are now able to do something we have all hoped for since the close of World War II -- lighten the load of the defense burden. In the short run, this adjustment has meant cutbacks and lay-offs in many industries that have depended on defense spending. We must ease this transition. But in the medium and long run, reductions in defense spending will free up many new resources for our people and economy. Second, it seems that almost every time you open the business pages you can find a story about a major U.S. corporation that is restructuring itself. Our industries are in the process of transforming themselves from old-style hierarchical organizations to so-called "flattened pyramids." This new industrial organization emphasizes a skills-based workplace, "lean production," a "just in time" inventory, and short product cycles rather than mass production. Our companies are integrating R&D, manufacturing, and marketing into a seamless web of innovation. This is a revolution as dramatic as the one when Henry Ford led the country from craft-based production to mass manufacturing early in this century. We have to make these adaptations succeed if America's industries are to keep ahead of their international competitors. Strong sales and productivity increases are the prerequisites for creating more jobs, boosting wages, and upgrading benefits. In fact, it is partly because of these changes that our annual growth in manufacturing productivity over the past 10 years was over 50% higher than in the Carter years. It's why American firms lead the world in exports. Nevertheless, these changes also have produced layoffs and relocations among both blue and white collar workers. Middle-aged breadwinners are wondering whether their company will be the next to make announcements, and they worry about their jobs, health care, and pension rights. Some are also troubled by the prospect that after sacrificing to send their kids to college --often the first generation to attend -- that these children's diplomas may not be golden tickets to security. Third, the l980s wiped away the dismal economic performance of the late '70s. We enjoyed the longest peacetime expansion in U.S. history, lasting seven and a half years. We created over 2l million jobs, more than all the new jobs in the other major industrial countries and the rest of Western Europe combined. Yet great booms produce excesses, and this time too many companies, too many financial institutions, and too many households took on too much debt. We have been paying down that debt -- and lower interest rates have helped us do it. Millions of people have refinanced homes at lower rates, reducing mortgage payments by as much as $1,200 to $1,500 a year. When companies restructured, they paid down debt, strengthened balance sheets, and positioned themselves to enjoy greater profits when stronger growth resumes. This process will leave our economy leaner and more powerful. Many firms already are. But while that debt was being paid down, people bought fewer goods, and companies put less money into new investments and jobs. The process is largely over, but it has left consumers and companies a little cautious. Fourth, we entered the '80s with a banking system designed 50 years earlier -- an incongruous relic in an era when billions of dollars can be sent around the world in a microsecond. The United States entered the l980s with some 14,000 commercial banks and 4,600 savings and loans. In comparison, Canada had about 160, and Japan had under 100. The vast majority of those small U.S. banks and S&Ls operated in a heavily controlled environment where their costs of funds were limited by ceilings on your passbook accounts. Other regulations restricted competition by imposing costs and inefficiencies on savers and borrowers. In the late '70s, this out-of-date system was buffeted by record interest and inflation rates; it was challenged by competition from new financial services. As in any other line of business, the less efficient institutions could not survive. But because our banks and S&Ls held insured deposit accounts for most hardworking Americans, the streamlining process had to be managed in a way that enabled the Government to protect your savings. In effect, the Government picked up these costs so your savings would be safe. This process, too, is nearing its end. A strong economy must have a good banking and financial system so entrepreneurs can get capital, businesses and farms can get loans, and families can buy homes and cars. We will have a more competitive and efficient financial system that will serve companies and families better. Over the next few years, the Government will actually gain revenues from the sales of billions of dollars of assets that it acquired from banks and S&Ls as it protected savers. But this process has left lenders cautious. Business borrowing rates and mortgage rates are way down, but it's still too hard for small businesses to gain access to capital and credit. We are still taxing capital too much. The final economic change is perhaps the most far-reaching of all: No nation is an island today. We are part of a global economy. To grow is to trade; to expand is to compete. One manufacturing job out of every six depends directly on our exports. One acre out of every three is sowed for sale abroad. This international economic interdependence has three implications. One, when growth slumps abroad, it drags our economy down with it. Both Western Europe (especially Germany) and Japan are going through major readjustments -- and that has contributed to our sluggishness. Two, it means that if America is going to be strong and growing in the 2lst Century, we must be ready, able, and willing to compete around the globe. We need to encourage entrepreneurial capitalism and investment at home, and at the same time ensure that our labor force remains the best in the world. Three, we need to seize opportunities to develop new markets, particularly in areas that have potential for significant growth in the future. One of the other benefits of the end of the Cold War is the extraordinary potential to expand trade and sales to hundreds of millions of potential customers who not long ago were the captives of our enemies. III. Start with Strengths In developing an agenda for the future, we should take a clear -eyed look at our strengths as well as weaknesses. Not surprisingly, the other side has conveniently skipped over our country's many strengths. Frankly, they want you to believe America is over the hill and past its prime. But they have no more right to convince you the economy is worse than it is for political advantage than I have to understate the problems. So let me just note several key facts. _ The Misery Index -- the sum of inflation and unemployment -- is down to l0.8% today, from l9.6% in l980. _ Inflation has fallen to roughly 3%, the lowest in a quarter of a century (except for 1986). _ Interest rates are at a 20 year low. Mortgage rates are now in the 8% range, half the rate President Reagan encountered in his first year. Thanks to these low rates, more people can afford to own a home today than at any time since l973. _ While unemployment is still far too high, the share of the working age population with jobs during my administration has averaged 62.2%, the highest in U.S. history. _ The United States has the highest home ownership rate of all major industrialized countries: 66% of U.S. households own their own homes, as compared with 59% in Japan and 40% in Germany. _ The U.S. sends more of its students on to higher education -- 68% -- than any other country, well above the 32% rate in Germany and 30% in Japan. And 52% of these U.S. students are women, as compared with 26% in Japan and 38% in Germany. _ With exports of $622 billion, the U.S. is the world's largest exporting nation. Exports increased by 40% during my Administration. _ We produce 25% of the world's total output with 5% of the world's population. _ The productivity of American workers is approximately 26% above those in Germany and 30% above those in Japan. I do not mean to suggest either that everything is well or that we do not need to lead and manage the changes taking place in the world and at home more actively. We do. But you can't chart the stars if you think the sky is falling. We must know our strengths before we build on them. Over the past 12 years, we increased the U.S. economy by about $2.8 trillion -- that's like creating the total size of the German economy twice over. So I know our goal of a $l0 trillion economy is attainable. We're also in a strong position internationally. But we're going to need the national adaptability and capability to keep leading our competitors. And we must have the courage of our convictions to say "no" to the wrong sort of changes for the future -- false promises based on false premises -- changes we cannot afford at this key moment in the world economic competition. IV. Guiding Principles Before outlining the specifics of my agenda, I want to set out four guiding principles. An effective strategy must be dynamic. As new problems or opportunities present themselves, we will need to make adjustments. Guiding principles will ensure we follow a consistent path and help shape our policies into the future. First, start with the basics: We are a nation of special individuals, not special interests. Individuals gain primary strength, protection, and inspiration from their families and communities, not the legal system or Government social services. People find their friends and their enjoyment in voluntary association with one another, not in some bureaucrat's paint-by-numbers dream. Individuals, families, communities. That's where we start. Second, we have to keep to the fundamentals of sound economic growth: lower tax rates, limits on Government spending, greater competition, less economic regulation, sound money, and more open trade that can free tremendous private initiative and growth. Experience has shown that these are the steps we need to take to create jobs, raise wages, spur entrepreneurs, expand capital and investment, and build businesses. Third, in the '90s Government can build on these fundamentals by offering opportunity and hope for individuals, families, and communities. There is a conservative agenda for helping people, for responding to their needs. And we've seen that these are approaches that work. We prefer a hand up to a handout. We want to empower people to make their own choices, to break away from dependency. We want to give individuals and families economic security by giving them the capital, the capabilities, and the confidence to decide for themselves. We want everyone to have a stake in society, to own property, so everyone will build something with it for themselves and our country. Whereas my opponent's approach may place a premium on redistribution and "leveling," our programs w. At the same time, we must execute our agenda more effectively with a new Congress, state and local governments, and the private sector. Our aim must be to press our policies together, as a package, to make America secure and strong. Therefore, my Agenda for American Renewal mandates action on six interconnected fronts. Because we face complex problems, no one solution will suffice. The whole of these elements will be a solution greater than the sum of its parts: _ Challenging the World: A Strategic Global Economic and Trade Policy _ Preparing Our Children for the 2lst Century Economy _ Sharpening Business' Competitive Edge: Encouraging Entrepreneurial Capitalism _ Promoting Economic Security for Working People _ Leaving No One Behind: Economic Opportunity for EverDuring the Cold War, we built a global security structure to contain and counter the Soviet Union and communist aggression. We forged military alliances across the Atlantic and Pacific that underpinned that structure. In the post-Cold War era, we need a strategic global economic and trade policy that will ensure our position as an economic and export superpower as well. We are well positioned to Mexican, and Canadian capabilities will improve our global competitiveness by enabling American firms to purchase inputs at lower costs. This will help U.S. firms to stay in the forefront of high wage, high value-added production. Our geopolitical position is also advantageous. The United States is both a Pacific and a European power; our political and security ties link us with the largest an Freedom has rolled through Eastern Europe, the former Soviet Union, and Latin America -- and the ball is now in our court. Free people and free markets develop hand in hand. People value American values. People want to buy what we have to sell. English is the language of freedom and business. Our political and economic ties are complemented by the appeal of American culture all around the world. This is a new "soft power" we can employ. Today, our movies, music, and videos are among our top-selling exports. Finally, as the primary founder and the most significant proponent of the GATT global trading system, we continue to have a strong hand as long as we use it to truly open markets, including our own. The key to America's growth, expansion, and innovation has always been our openo secure Congressional agreement to NAFTA and to complete the global trade negotiations -- the so called Uruguay Round negotiations in GATT. Our NAFTA agreement will open doors for American businesses, workers, and consumers. It will create good jobs. Nevertheless, I expect a tough fight in the Congress in early l993 because of those special interests who herd together with a protectionist purpose. The global trade negotiations, in turn, could be very close to a breakthrough if the United States continues to act as a strong world leader. There is a proposed draft text that establishes the outlines of a significant new GATT agreement. Once we assure cuts in the subsidized agricultural trade along the lines of that text -- to enable our farmers to secure their competitive advantage -- I bade, for stronger investment ties, for increased global growth. We need to start to develop a strategic network of free trade agreements {FTAs} across the Atlantic and the Pacific and in our own hemisphere. This network will stand in sharp contrast to the backward blocs of economic isolation. If we are to be a true export superpower, we cannot be tied down to one region. Instead, my intent is to use our attractive domestic market as the basis of a muscular free trade policy that will strengthen America's global economic reach and complement our worldwide security presence. By focusing on opening markets, I also believe we can reduce structural barriers to competition in North America, Western Europe, Japan, and elsewhere. Competition will encourage entrepreneurial capitalism -- at the expense of entrenched interests -- spurring even greater global growth. More specifically, I will need to secure from the Congress additional trade negotiating authority within the first half of l993. To overcome the special interests and the protectionists, I will need a mandate from the American people. If America is going to be an export and economic superpower, the U.S. President must take a strong stand on the negotiation of trade and economic agreements. The Congress will read vacillation and equivocation as weakness, and the national interest will lose out to the logrolling tradeoffs of Congressional business as usual. That's one very big issue at stake in this election. With new negotiating authority, I will pursue new trading and economic opportunities in Latin America under my Enterprise for the Americas Initiative, starting with Chile. I would also like to work towards FTAs with Poland, Hungary, and Czechoslovakia by the end of my second term. And I would explore the possibility of a connection between NAFTA and the ASEAN FTA, or AFTA. It will not take long for other countries to begin to express their interest in new trade and business ties with us. For example, leaders in Australia and Korea have already spoken of their interest in forging closer economic ties. Some see new threats, others see old enemies. I see new markets, new opportunities, new jobs. As we develop this economic and trading network for the 2lst Century, I will fight hard to promote American trading interests. For example, I am committed to a sizable Export Enhancement Program {EEP} to ensure that our farmers can go head-to-head with the European Community's subsidized agricultural exports. We know from our experience with military security that the key to economic security must be based on "Peace Through Strength" -- not unilateral disarmament. That's why I recently announced the largest quantity of wheat ever available under our EEP program -- almost 30 million metric tons to 28 customers. I will ensure that our ExIm Bank and the Overseas Private Investment Corporation (OPIC) work with teams of our ambassadors to develop trade and investment opportunities for U.S. firms. We've already begun this with the six ASEAN countries -- and it's working. I will particularly stress helping America's small businesspeople to develop trading opportunities. These companies look small -- but they trade big. I know. I started my own. And I have visited small factories all across the United States that first survived and then prospered by taking on the foreign competition. I know Americans can do it. VI. Preparing Our Children for the 2lst Century Economy In the 21st Century our greatest national resource will be our people. Materials, machines, and methods will come and go, but the American worker will remain the key to our economic security. Since the workplace of the 21st Century will be constantly changing, we need to prepare the American people to adapt to and direct the process of change. Therefore, our kids must arrive at school ready to grow, and they need schools where they will learn how to keep learning all their lives. Our New American Schools will help prepare our children to become the contributing citizens of tomorrow. Equally important, we want to enhance children's sense of self-worth, their confidence, their sense of participation in a larger community and society. This is the conservative philosophy of empowerment, helping people to help themselves. I want to do my best to help all children come into the world as truly "created equal." That's why I am more than doubling funding for a Healthy Start initiative that targets communities with high infant mortality rates. We are also increasing prenatal care, nutrition services, and substance abuse treatment for pregnant women. And I want everyone to spread the word that every parent must share the gift of good health with their children. We need to focus especially on the preschool years, so that children coming to school are healthy and curious. Funding for the Women, Infants and Children Nutrition Assistance program (WIC) has grown 258% between 1980 and 1992; my request for an additional $240 million for 1993 brings the annual cost to $2.8 billion. I have also increased funding for the Head Start program by 127% -- for a total of $2.8 billion in 1993. That includes an additional $600 million increase for next year -- an unprecedented 27% annual jump -- so that a year of Head Start will be available for every eligible four-year old whose parents want to participate. (Under my budget, almost 800,000 children will receive a year of Head Start before entering elementary school.) Child immunizations are also vital to safeguard our kids' health. Every year since 1981-82, 95% or more of the children entering elementary school have been immunized against the vaccine-preventable diseases. Now we are focusing greater attention on preschool children. My 1993 budget calls for an 18% increase in child immunization grants. I want the United States to offer opportunity and encourage excellence; we must be fully capable of competing in a global economy. Therefore, it is imperative that our educational system prepare and point the way for our children. As in the past, education should be the ladder that the child of modest means can climb to better him or her self. Our current school system is falling short of these needs -- and the poor are hurt most. Only l9 out of 66 public high schools in Chicago graduate more than half their students, and many of these graduates can barely read or write. Our educational establishment is caught in a sort of time warp, a system created for another age when the needs were not the same, children grew up differently, and adults rarely changed jobs. Money alone is not the answer -- the United States already spends more per pupil than any other country but Switzerland. And funding for the Education Department has increased 41% over my term. The answer is a radical overhaul of our educational system. If we want to change our country, we've got to change our schools. That's what my America 2000 program is all about. Our kids can't beat world class competition if they can't meet world-class standards. We are moving ahead with the development of these standards in math, science, English, history, geography, arts, and civics. Second, we need voluntary national achievement tests to measure the progress of our students. That way we can compare the performance of different schools in helping our children achieve the national standards. Third, we need to give schools the flexibility to become educational entrepreneurs -- to figure out the best ways to motivate our children, use technology, include parents, and involve new types of teachers. We will create "Education Enterprise Zones." There is no particular reason why schools have to end at 3 p.m. so that students can sit in front of the TV for five hours a day. We need to free school administrators and teachers from rules, regulations, and reports that have become a poor substitute for student achievement; we can do away with red tape once we institute a new testing system that evaluates schools not on the basis of how many forms they complete, but of how many minds they prepare. Finally, we must take school choice off the administrator's desk and put it back on the kitchen table. Choice is critical to the success of the whole, integrated overhaul of our educational system. Competition, the underlying principle for this radical reform, will not work unless we give consumers the ability to choose. Wealthy families already have this choice for their children. Many of the people that you saw at the Democratic National Convention have this choice for their children. Why shouldn't you have this choice for your children? Chicago's public school teachers -- 46% of them -- send their kids to private schools. But my opponent and his special interest supporters don't think you should have the same choice unless you are privileged enough to afford it. One of the greatest educational innovations in this country was the passage of the GI Bill after World War II. No one told my generation that a vet couldn't go to Notre Dame or Brigham Young or Baylor or Howard or Yeshiva. So I want a "GI Bill for Children" to help give lower and middle income families the means to select any school: public, private, or religious. I also want scholarships available to be spent on after-school, Saturday and summer academic programs. For those who argue that my approach will weaken the public school system, I would remind them that the first GI Bill was a tremendous boon for public universities. Or listen to Starr Parker, a small business owner actively promoting choice in the Black community, who put it this way: "The rich have choice now. When I was on welfare, there was no way I could put my child in school. It's time we stop condemning the poor to a monopoly education system." We've already made significant progress in starting this radical reform agenda. Some 44 states, and over 1700 communities, have already adopted my new national education strategy -- America 2000. Indeed, this progress offers a good example of my commitment to pursue my agenda whether or not Congress dawdles. If Congress balks, I will work with governors, state legislators, community officials, and the private sector. I hope the new Congress will not remain an apple polisher for the educational establishment and special interests that want to resist this revolution. A new system of education in this country is probably the most important ingredient over time in making America the winning economic and export superpower in the post-Cold War era. This must not only be my agenda, but yours, too. I will fight to give parents in America the right to choose the school their children will attend, but you need to help, too. After you check out of work, check into your child's homework. Talk to your child's teacher. Join your local PTA. My approach -- America 2000 - - relies on parental, business, and community involvement in creating new schools that break the mold. I put the family at the center of our society. Government must try to help families -- not replace them. When it comes to choices for our children, parents really do know best. We should increase the range of choices available to parents, and Government assistance should be targeted to those families most in need. The other side may talk about similar problems, but they are approaching them with a fundamentally different ideology. You can see the contrast not only in education, but in health care, or in the debate that took place over my child care proposal, which we fought for and managed to enact into law. The opposition prefers uniformity to variety and choice. Because they place a higher value on "leveling" society, they will tend to rely on Government bureaucracies to offer "standard service." My approach to education, child care, health care, and other topics is to rely on a diverse private sector to supply the service and to empower families to make their own choices. I don't want to pull everyone down to make them equal. I want to give everyone the tools to climb as high as they can dream. VII. Sharpening Business' Competitive Edge: Encouraging Entrepreneurial Capitalism Our ultimate success as an economic superpower is dependent on encouraging the entrepreneurial spirit of our private businesses. I call it entrepreneurial capitalism, and I saw it work when I started a small business in Texas. I also call it common sense. You allow people to keep most of what they produce, and they will produce more than they can use, the rest being capital. You invite people to risk failure by allowing them to keep the rewards of success, and they will keep trying until they succeed. When capital is taxed lightly, it becomes abundant. When it is taxed heavily, as it is now, it becomes scarce, available only to those at the top, who need it least of all. That's not what I want. Even Jesse Jackson put it this way: "Subtract capital from capitalism and all that's left is the 'ism'." If capital were abundant, labor would become scarcer. And the unemployment lines would shrink. That's what I want. So I want to cut the capital gains tax and index it for inflation. I want to create enterprise zones in inner city and rural areas. I want to make the R&D tax credit permanent. I want to provide an additional first-year depreciation allowance for purchases of property. Those are fundamentals. In addition, there are three other ways we need to sharpen the competitive edge of American business: _ strengthen small business; _ support civilian R&D linked to a research extension network; and _ reform our costly legal system. A. Strengthen Small Business Small business is the backbone of a growing economy. Small businesses create two thirds of our new jobs; they account for 39% of our GNP. I am seeking to aid small businesses by reducing costly tax and regulatory burdens, increasing access to credit, and removing barriers to competition. I have taken steps designed specifically to ease the tax burden on small businesses. For example, the IRS has proposed regulations to allow small businesses to deposit payroll taxes on a monthly basis. And it has released a ruling allowing over 16 million sole proprietors to deduct tax preparation fees as a business expense rather than as a limited itemized deduction. I want to build on these actions. For example, we are working on a Single Wage Reporting System that would permit businesses to report state and federal wage information through a single entity, thereby consolidating tax reporting requirements and reducing the burden. In coming weeks I will talk more about ways we can encourage small businesspeople and the jobs they create. On the regulatory front, I have extended for one year the freeze on paperwork and unnecessary federal regulation that I imposed last winter; the federal regulatory weight hits small businesses particularly hard. I have also instructed federal agencies to look for ways to modify existing regulations that impose a special economic burden on small business. For example, to increase access to capital for small businesses, the SEC has announced proposals to reduce and in some cases eliminate the public disclosure requirement for small companies issuing stock. Since smallneeded, I'll expand the project to other regions. We also have worked with bank regulators to base real estate values on income earning potential rather than liquidation value. We have taken steps to restructure the small business investment program, the only venture capital program in the Government. And we are developing ways to offer special financing to exporting entrepreneurs. Through its petition. My health care reforms would reduce costs for small businesses without costly Government mandates or higher taxes. Enactment of my legislation to establish uniform federal law on product liability would relieve a major competitive handicap that is keeping new products from the market, boosting insurance costs sky high, and killing jobs.