 Everything got quiet all of a sudden. Well, good afternoon and thank you all very much. I'm delighted to have all of you here, and I understand that you've received extensive briefings from secretaries Hodel and Regan and Dole and Weinberger, so you've already had an earful. And I'll just add that I believe our economy is moving forward with strength and confidence. We've surmounted recession, built a recovery and put America on the threshold of a lasting economic expansion. I'm sure you've got all of that in the briefings that you've had so far. In 1981, we inherited an economy that nearly, well, it was nearly ruined by a nightmare of double digit inflation, record interest rates, and over-regulation and taxation. And we set out to change course dramatically, and I think that we have started this in another direction. The growth of federal spending has been cut more than in half, and across the board, tax rate reductions are providing new incentives for production, savings and risk-taking, and deregulation of basic industries like banking and energy is sparking new competition. In addition, in the cutting of that, we're eliminating a great many of those regulations under the chairmanship of George Bush and his task force. Some amazing things have occurred. We estimate that we have reduced on the part of local governments and private individuals the amount of paperwork by some 300 million man-hours a year. And I've always wanted to see what would happen sometime if we and government just shut the doors and quietly slipped away to see who'd miss us. But one example sums up the difference between the old policies of government pump priming and our approach that is based on trusting people. Last year, we were asked to support a $3.5 billion program that was meant to create make-work jobs for 300,000 people. And we resisted that, and that program didn't go into effect. We thought that economic recovery could do the job better. And so far in the last 14 months, we have averaged putting more than 300,000 people to work every month. There are now 4 million more workers on the jobs than there were a little more than a year ago. I believe that we're beginning an industrial renaissance which most experts never saw coming. It started with the 1978 capital gains tax reduction that was passed over the objections of many in government at that time. And it was then made greater by our own tax cut program in 1981. Incentives laid the seeds for the great growth in venture capital which helped set off the revolution in high technology. Sunrise industries from computers to fiber optics are creating a world of new opportunities. And as our knowledge expands, business investment has stimulated a modernized older industries with the newer technologies. We've seen the venture capital industry raised four times as much capital, 1983 as it did in 1980. And we've seen real fixed business investment increase by a 13% rate last year, the fastest of any recovery in the past 30 years. And we've seen funds raised in equity markets zoomed from 17 billion in 1982 to 36 billion in 1983 and that is another record. Potential for growth, new opportunities will be infinite if we marshal the power of incentives and human knowledge and transform our economy and reach toward our next frontier, which is space. This is why I take a very hard line to those who in the name of reducing deficits would raise taxes and risk sabotaging the recovery. Believing we can make more money available for individuals and businesses to borrow in the credit markets by taxing more money away from individuals and businesses is believing in what never was and never will be. The central problem our critics refuse to address is not the deficit alone, but government's total burden on the economy because whether government borrows or increases taxes to meet the deficit problem, it'll be taking the same amount of money from the private sector. The solution is to reduce that burden by bringing down government spending to a level where it cannot interfere with the economy's ability to grow. So we're pushing a constitutional amendment, mandating a balanced federal budget, a line item veto to prevent pork barrel projects from slipping through as amendments to otherwise needed legislation, and speedy consideration of the Grace Commissions recommendations to reduce billions of dollars in wasteful spending and subsidies. We have those 2,478, I believe it is, recommendations from the Grace Committee, and we are now studying those as to how they can be implemented and whether they will take legislation or not. And incidentally, this line item veto, I speak from experience as Governor of California, I had it as do 43 governors today, and I in my eight years out there vetoed 943 spending items inserted into the budget after it had gone back to the legislature, and I had the right to veto them out. And when they had to face those particular items, all isolated, not part of a budget, and vote yes or no on them, I was never overwritten on a single veto. I want line item veto as a president. And finally, we want to combine all these things we're talking about with another key reform, tax simplification to make our economy the undisputed leader for innovation, growth, and opportunity. We can make taxes more fair, easier to understand, and we can greatly increase incentives by bringing personal tax rates down. If we can reduce personal tax rates, as dramatically as we've reduced capital gains taxes, the underground economy will shrink, the whole world will be the path to our door, and no one will be able to hold America back. The real question America must face is not if we should work toward a balanced budget, but how? We can balance up by raising taxes to accommodate higher and higher spending, but risk locking ourselves into economic bondage, or we can balance down by reducing spending growth and tax rates and permit our economy to break free. I believe that balancing down and breaking free is the true path toward declining deficits and an opportunity society, one that will offer a brighter future to all Americans. So I've gone on long enough and perhaps longer than I should, but some of you perhaps have a question, yes? Now I have to say, yes, we've kept in very close touch and they are increasing the money supply within the bounds of the approach that they've set, the upper and lower limits and right now it's about midway in there, and that path is commensurate with the growth in the economy. All we ask of them, and of course all we can do is ask because it is an independent agency, but all we ask is a money supply commensurate with our economic growth and one that will not re-inspire inflation to take off. For my question, is there a possibility that this year we will see a summit meeting with the new Communist Party leader, Chernyenko, and yourself? Well, let me say, this is one I can't really answer for you because relationships are very delicately balanced in so many ways, but let me say that I am supportive of the idea and we are in communication, we are in negotiations of a number of things since this change to see if we cannot enhance the relationship between our two countries. We've made it very plain to them that we know neither one of us will ever agree with the other's political philosophy, but we have to live in the world together and we are the two nations that could guarantee peace to the world if we'll only get down to the business of doing it. Well, we're believers in an open market and yet with regard to high technology, we have tried to set guidelines and rules that will keep us from giving away high technology that can then be used to strengthen possible adversaries against us and that is particularly true with regard to the other superpower, but that is all that we're trying to accomplish with that and to the best of our ability to retain a free fair and open market. No, wait a minute. This was on the merger and I didn't get the last part. Well, since I know that this is a legal matter now and that it's being decided and I have tried to keep quiet on it, but I don't mind telling you, I do not believe that such a merger would reduce competition to the point that it would constitute monopoly at all. Where we're headed with regard to foreign policy in Central America, I hope we're headed directly down the line that was laid down by that bipartisan commission after they went down there for six months and studied the entire situation. I am very fearful of the attitude of some in Congress who can't see that that is in our best interest to see that we solve some of the economic and social problems of our Latin American neighbors to eliminate those societies that are based on extreme wealth and then extreme poverty with no chance and opportunity for a middle class in between. And at the same time, to bring that about and those reforms about, we've got to give them security. You can't institute economic reforms when the government in charge and the people are having their head shot off at rebels that are inspired by the Soviet Union and by Cuba. And we can use all the help we can get because those people in Congress that are trying to tell us that somehow we have no responsibility, no reason for being there and if they can't look at the map and see what another Cuba geared to expansion down there in right here in our continent, what that means to us, one of our congressmen came back from talking to some of the Nicaraguan government officials. He had gone down there opposed to our viewpoint. He came back the other way around and he told us that one of the officials in the Nicaraguan government had said to them, said to him, don't be surprised if in a year and a half you see us at the Arizona border. Now, huh? Oh, Mike Golly, I didn't think anyone would remember that. I wish Mac Baldritch were here. This has to do with our machinery and sales overseas and now. Well, the only thing that I know about the restraint on export licenses has to do again with that same security matter of anything that would affect our national security by being in the wrong hands. That curbs getting a license. I don't know of any difficulty with anything beyond that. Yes, I think we're thinking back now to when with our European allies we were trying very hard to convince them that becoming customers and virtually totally dependent for energy on the Soviet Union was a rather dangerous way to be and so this was one of the reasons why we were trying to discourage their partnership or their patronage of that proposed pipeline in the Soviet Union. Then as we went on with the summits and we finally were able to convince them to quit providing things and subsidizing purchase price and so forth with the Soviet Union and there was a relaxing and we have the creation of COCOM and the GATT treaties and all and there was a relaxing of that but there are still, I know in our own cabinet discussions there are still some items that we believe are detrimental to us to our security in that entire field. I'm being told I can only have one more and I'm sorry. Well, this was one of the things we got some agreement on with them in what's called COCOM that finally, and this was where we relaxed when they agreed that there would be restraints on their part also. Now maybe they're not as complete as we would like but we can take complaints to this body now that we formed with them and hopefully we can act as allies together and our relationship in that regard is far better than it was a few years ago when we were arguing about the pipeline. That's all I can do. You have another appointment. Well, I have to, I've just got to tell you one little experience here since the press, that fell as ours since the press, the other kinds of press isn't covering this thing. Not that I would resent this but when I'm mentioning the summits that we've had and these have proven to be quite an experience, the seven countries plus the head of the European Common Market that come together and last year we came together at Williamsburg, this wonderful village of ours that has been restored to what it was like in colonial times. First meeting was to have dinner on the first evening in the British governor's colonial residence there and so I was all set. I was hoping with what I thought would be kind of a leveler and I was going to say to Margaret Thatcher, Margaret, you know if one of your predecessors had been a little more clever you would be hosting this gathering. And gentlemen, never underestimate the ladies. I started with my line. I said, Margaret, if one of your predecessors had been a little more clever she says I know I would have been hosting this gathering. So I'll mind my tongue when I get to London for the summit this in June. Alright, well thank you all for being here. It's been a great place.