Presidential Radio Address - 15 October 1983
My fellow Americans:
I know I court trouble when I dispute experts who specialize in spotting storm clouds and preaching doom and gloom. But at the risk of being the skunk that invades their garden party, I must warn them: Some very good news is sneaking up on you. The quality of American life is improving again. "Quality of life"—that's a term often used but seldom defined. Certainly our standard of living is part of it, and one good measure of that is purchasing power.
Just a few years ago, double-digit inflation was bleeding our purchasing power. Record price increases, interest rates, and taxation punished the thrifty, impoverished the needy, and discouraged entrepreneurs. When an economy goes haywire, confidence is destroyed. Well, today the tables have been turned. Double-digit inflation is gone, and confidence is coming back.
In 1980 the U.S. ranked only 10th among 20 industrial nations in per capita income. By the end of 1982, we'd climbed all the way up to third place. Our stronger dollar has increased purchasing power. Real wages are up. And inflation is down to 2.6 percent.
Sometimes when we shop we don't realize how much inflation has dropped, because prices are still going up. But they're going up much more slowly than before. If food prices had kept rising as fast the last 2 years as the 2 years before we took office, a loaf of bread would cost 7 cents more than it does today, a half gallon of milk 18 cents more, a pound of hamburger 60 cents more, and a gallon of gas 97 cents more.
The prime interest rate has been cut nearly in half, so costs of business, mortgage, education, and car loans have dropped. The Federal income tax on a typical working family is $700 less than if our tax program had not been passed. With parents, students, entrepreneurs, workers, and consumers feeling more secure, opportunities for jobs are expanding. Our work force in September rose by nearly 400,000 to 101.9 million—the highest level in American history. And the trend will continue.
Quality of life is not just more jobs, it's also better jobs. And we're seeing better opportunities opening up for all Americans. Women, for example, filled more than half of all the new jobs in managerial, professional, and technical fields between 1980 and 1982. The number of women-owned businesses is growing five times faster than men's. The future looks brighter. To get a peek at what tomorrow's jobs and products may be, look at the venture capital industry. This is where high-powered capital is invested and much of the technological revolution is taking place.
During the first 9 months of 1983, the venture industry raised about $2% billion-nearly three times more than in all of 1980. The General Accounting Office has already estimated that previous venture investments of some $209 million in the sample of 72 companies directly generated 130,000 jobs during the decade of the seventies. Well, if $209 million of venture capital generated 130,000 jobs in 10 years, imagine how many jobs $21/2 billion will create during the next year. And like interest that compounds, growth and opportunities create more growth and more opportunities.
Capital spending by business, a key source of higher productivity and new jobs, helped propel the economy forward in the third quarter. Much of the increase in spending went for products of high technology like computers and word processors.
We're witnessing an industrial renaissance, and this is only act one. It's being nourished by incentives from lower tax rates, starting with the 1978 capital gains tax reduction, passed, incidentally, over the objections of the last administration, and followed by our own more sweeping tax cut program in 1981.
Our program to create opportunity and bring big government under control, the subsequent decline in inflation and interest rates, and prospects for robust growth have all led to another basic change: Americans' confidence in their institutions is turning up after nearly two decades of decline. A 1982 survey by the University of Michigan found people more likely to say they trusted the government to do what is right.
Looking beyond the economy, we see more evidence that the quality of life is improving. Life expectancy reached a record high last year, climbing to 74.5 years. Infant mortality declined to an all-time low with only 11.2 deaths per 1,000 live births. And the number of divorces dropped for the first time since 1962. Serious crime dropped 3 percent, the first measurable decline since 1977. Quality education, an American tradition—but one neglected for years—will be restored, thanks to leadership in Washington and vigorous action by your families at the grassroots.
Good things are happening in America. Confidence is returning. Our quality of life is improving because your voices, voices of common sense, are finally getting through. Believe me, it wasn't Washington experts who said government is too big, taxes are too high, criminals are coddled, education's basics are neglected, and values of family and faith are being undermined. That was your message; you made reforms possible.
With your help, we'll make even more progress, because I'll be the first to admit much more progress needs to be made. We're on a new road for America, a far better road, filled with hope and opportunities. Our critics may never be satisfied with anything we do, but I can only say those who created the worst economic mess in postwar history should be the last people crying wolf 1,000 days into this administration, when so many trends that were headed the wrong way are headed back in the right direction.
Thanks for listening, and God bless you.