And that has been the American experience: to be that city upon a hill a bright jewel in the galaxy of nations that holds out to all mankind the dream of "life, liberty, and the pursuit of happiness." What has made this such a great nation? What has made people talk about the American Dream? Has it been the land? To be sure, we have been blessed by an abundance of natural resources, but in the Soviet Union we see a land mass that is much larger than our own, is equally well endowed, and yet the Russian land yields a smaller harvest of goods for its people. Today the Soviets turn to the United States for the grain they so badly need. Does our secret lie in the talent of our people? To be sure, we are blessed with one of the largest and most talented populations that the world has ever known, but in China we see a population that is four times as large as our own, whose civilization was developed far in advance of our own, and yet today their standard of living is far below our own. Our land and our people, then, have both been essential parts of the American story, but they are not the whole story. A third ingredientthe ingredient that is missing in the Soviet Union and China, the ingredient that has always made us different-has been our freedom. The early Americans streamed to these shores in search of freedomfreedom of religion, freedom of speech, freedom of the press, freedom of assembly, and freedom to seek their fortunes without fear or favor of the government. Each of these freedoms was planted firmly in our Constitutional soil; each grew and bore fruit; but each has become such a familiar part of our landscape that I now wonder whether we take them too much for granted. Those of you who have had the privilege to travel in other lands have seen how precious freedom has become in the world today. Only a tiny handful of nations now permit their citizens the liberties we enjoy here. It is no accident that in every country where people have been given a free choice between communism and democracy, they have voted for democracy. And thousands of people have gladly risked their lives in desperate attempts to escape from tyranny into freedom. There is nothing plastic or artificial about freedom, nor is there any guarantee of its permanency. As Dwight Eisenhower once said, "Freedom has its life in the hearts, the actions, and the spirits of men, and so it must be daily earned and refreshed-else like a flower cut from its lifegiving roots, it will wither and die." I worry greatly today about the survival of one of the most vital but least understood of our freedoms in America: our freedom of enterprise. The free enterprise system is the foundation of our economy, the rock upon which we have built our earthly kingdom. It is the system of free enterprise that has summoned forth the genius of our people-young men and women like you who wanted to make a difference in the world. One of our greatest inventors, Ben Franklin, was a printer's apprentice at 12, was writing and selling ballads at 15, and was publishing his own newspaper less than a decade later. Eli Whitney invented the cotton gin within a year after he graduated from college. By the age of 26, John D. Rockefeller had emerged from the obscurity of being a sales clerk to owning his own oil refinery. At the same time, 10-year-old Thomas Edison-expelled from school because his teacher thought he was retarded-was working in his own chemistry lab and by the time he was 30, had invented the phonograph. And at the age of 13, Andrew Carnegie went to work in a cotton factory-a poor immigrant from Scotland. It is the system of free enterprise that has also provided productive jobs for the great majority of workers, fulfilled basic wants, enabled people to live more satisfying lives, and enriched the human experience. The cotton gin that Eli Whitney invented not only increased our cotton exports by more than a hundred fold within less than 20 years, but it also provided inexpensive clothing to millions of people. The mass production introduced by Henry Ford gave the world a cheap form of transportation that has been crucial for our industrial progress and has provided us with personal mobility that would have seemed impossible a century ago. And the little Brownie camera that George Eastman marketed in 1895 opened the way to a whole new art form that has given us all an extra sense of understanding and joy. Nor have such advances been limited to work done by men. There have been a countless number of women whose stories are not as well known but have also been a vital part of our history-women such as Eliza Pinckney whose perfection of methods for growing the indigo plant gave the Carolinas a product that was the main staple of their economy before the Revolutionary War. Each of these men and women enjoyed and thrived on the freedom provided by our economic system. It is, indeed, the system of free enterprise that has given this country the greatest prosperity and the highest standard of living ever known to man: -In the last 15 years, poverty in this nation has been cut in half. -Our farms today are harvesting more than twice as much grain as they were a quarter of a century ago-and with far fewer people to get the job done. Each American farmer now feeds as many as 50 of his fellow citizens with one of the most nutritious diets anywhere in the world. -Our technology has made us the only nation on earth to place a man on the moon-and we've done that six times now. -Our medical science has extended average life expectancy by more than 10 years since the turn of the century. -Our technology has provided us with more leisure time-time for recreation, hobbies and for being with friends-than any society since the days of the ancient Greeks. -And our economic wealth has allowed us to give other nations over $110 billion in food and economic assistance in the last 30 years generosity that finds no parallel in world history. It is also the system of free enterprise that has fired the imagination and determination of our people. No mountain has ever been too high nor has any ocean ever been too wide to cross. To cite but one example, you may recall that a century ago the Civil War practically destroyed the country's whaling fleet, bringing a collapse to the industry that provided the major source of lighting. Within a few years the price of whale oil shot up from a few pennies to over $2 a gallon. Cries went up across the land, "We are ruined." What happended? Men with vision who had discovered a way to make kerosene began marketing kerosene lamps in place of whale oil lamps and before the end of the century two new industries-petroleum and electrical-were rapidly developing. As for whale oil lamps, -a useful reminder of how our system they were sent to the museum- It is also the system of free enterprise that has taught us never to give up, never to fall prey to the cynics, and the preachers of gloom and doom. That fine old gentleman, Thomas Edison, is said to have tried 586 experiments to find the right filament for an electric light. None of them worked. "It's a shame," his assistant told him, "to have tried 586 times and failed." "But we haven't 586 failures," Edison replied. "But, sir, we have," cried the assistant. "No," said Edison, "we now know 586 ways that won't work and won't have to be tried again." Edison would not allow himself to be defeated, and eventually, of course, he made one of those breakthroughs that has changed the course of civilization. Edison was never a quitter. To him, as he once said, "genius is one percent inspiration and 99 percent perspiration." Yet today, I submit to you that it is this same system of free enterprise the system that has given us so much-that has been placed in greater danger than at anytime in my memory. For years America has been drifting away from her moorings, lured by the false promise of those who say that the government can do the job better than the people themselves and that we can no longer trust the individual to look out for himself. We see the threat to free enterprise in the growing domination of government spending within our economy. Back in the 1920s, 12 cents out of every dollar spent in the United States was spent by the government. Today 33 cents out of every dollar is spent by the government. And if these trends continue, before the end of this century-when most of you will still be in the prime of life-the government could be spending as much as 60 cents out of every dollar. If we ever reach that dreaded day when you spend half of every day just earning money for the government, you had better have your hand on more than your wallet: you will also find that your personal and political freedoms may be stolen. As President Ford has said, "a government big enough to give us everything we want is a government big enough to take from us everything we have." Why has government spending exploded? Because, I would suggest, we have been willing to assign to the government the responsibility for solving many of the problems that people should be solving for themselves. We begin with the best of intentions but wind up with social programs that are spinning out of control. The food stamp program began as a small, $14 million experiment in 1962. By 1976, it will cost over $6.6 billion a year-a 47,000 percent increase and it is a wellknown haven for the chiselers and rip-off artists. Only a few weeks ago, a national magazine advertised a booklet that told people how to obtain food stamps even if they earned as much as $16,000 a year. So much for the spirit of self-reliance. We also see the threat to free enterprise arising in the army of government regulators that has been marshalled along the banks of the Potomac. The regulators are a little different from the traditional bureaucrat. There was a time when a story about Pope John rang for Washington as well. The Pope was asked by a visitor how many people worked in the Vatican. He thought for a moment and answered, "I would say about half." The regulators are changing that tradition in Washington: they are all working full-time, and they seem to be working overtime on the business community. Let's suppose for a moment that you lived in Chicago and borrowed some money to start a small trucking business to carry freight to Cleveland, Ohio. That seems easy enough: Cleveland is not far from Chicago. Should you then rush out and invest in a few trucks? Sorry, the first thing you should do is file a request with the Interstate Commerce Commission. That will cost you $350 in filing fees, and you'll probably need a private lawyer to boot. Well, you say, the request must be only a formality and you can get started in a few weeks time. Sorry, but the request will almost inevitably lead to legal hearings and you will have to prove that existing service to Cleveland is inadequate and that existing carriers cannot be made to provide it. The average request now takes 10 months to process and some have been known to take over three years. Protests by existing carriers often lead the ICC to give only restricted approval to requests from new carriers and, especially along well-traveled routes, to deny many requests altogether. Undaunted, you wait it out, obtain your approval, and decide that the best way to get a break on your competitors is to reduce the prices you charge to your customers. Sorry, your proposed rate reduction will probably be protested by other carriers and then suspended by the ICC. In effect, the government will force you to charge higher prices, even though you could afford to charge lower ones. Nonetheless, even with the higher rates you win a few customers with exeptionally good service, and new customers appear, asking that you carry their goods from Cleveland back to Chicago. Good, you say, your business is expanding. Sorry, the ICC won't allow it unless your original certificate specifically authorizes you to carry those products on the backhaul to Cleveland. The ICC requires instead that you drive back to Chicago with an empty truck-a practice that is still frequent even in a day of high cost energy. Despite all of these problems, you persevere and customers soon want you to carry their goods not only to Cleveland but also downstate to Columbus, Ohio. Sorry, but your ICC certificate says you can only go between Chicago and Cleveland; to drive to Columbus, you'll have to get a new certificate, and that means you'll have to start the whole process all over again-lawyers, forms, hearings, rate settings, the works. At that point, you might be justified in throwing up your hands and sending off for that pamphlet which tells you how to collect food stamps. I wish that I were exaggerating the complexities and frustrations of dealing with the government bureaucracy, but I'm sad to say that it's all true. In this and a countless number of other ways, the Government's regulatory process has become so heavy handed that it is beginning to strangle the free enterprise system in this country. Nor do regulations provide much help for consumers, for they breed inefficiency and run up operating costs-costs that reflect themselves in the tens of billions of dollars of inflated prices. Your government has proven that it is simply not equipped to replace the private business system in this country. Even Ralph Nader, the arch critic of the auto industry, once noted that, "If there is one thing worse than GM producing cars, it would be the U.S. government producing them." We can also see the threat to free enterprise in the climate of misunderstanding and hostility that now surrounds our business community. Most of our major public institutions in this country—the government, our schools and our places of worship have all declined in public esteem in recent years, but none has suffered as severe a drop as business. Young people in particular show a dismaying lack of trust in the business community: to many of your peers, profits are not properly understood as the basis for creating new jobs but as an example of human greed; corporations are thought to be raping the environment; and big oil companies are said to be conspiring against the consumer. The misconceptions that exist about business today are staggering. A recent poll conducted by George Gallup among college students found that the average estimate of business profits was 45 cents on every dollar; in reality, profits are only onetenth that amount. It's that kind of misunderstanding which has led to laws in the United States that impose a heavier tax burden on corporations than do the tax laws of almost any other major country in the world. Some two hundred years ago, when the founding fathers gathered in Philadelphia, there was a great deal of secrecy about the constitution they were drafting. As their meetings broke up, a woman rushed up to Ben Franklin and asked, "Well, Doctor, what have we got, a republic or a monarchy?" Franklin looked at her a second and then answered, "A Republic, Madam, if you can keep it." That, my friends, is the question we face today: can we keep this great free enterprise system that our forefathers helped to provide for us in the early days of our Nation? Two hundred years ago, when America fought for her independence, do you realize what that struggle was all about? Economic freedom-that was the central issue. Now, as we celebrate our Bicentennial, it is certainly ironic that economic freedom has become a central issue once again-and once again, we must fight to secure our liberties. Let us not deny that there are flaws in this system. It does not provide all of the answers to our problems and it creates problems of its own. But it has proved over and over again in history that it provides greater opportunity for career development and personal fulfillment, greater material wealth for more people, and a better guarantee of our personal and political freedoms than any other system ever known. Instead of blindly condemning the system, let us open our eyes to its faults and work to correct them. Instead of tearing down the foundations of America, let us build upon them. And instead of turning our backs and dropping out when the going is too rough for any one of us, let us unite and join forces so that we will have the strength of ten. In many ways, I find that young people are way out in front of the rest of society. You insist upon straight answers. You will no longer accept rhetoric in place of reality, promises in place of performance. If I understand the voice of the young, you are saying that our loss of faith in our ideals does not mean that the ideals have failed but that we have failed to live up to them. And a growing number of young people are beginning to recognize the grave dangers which over |