FROM THE OFFICE OF PUBLIC AFFAIRS

Good morning.

In the past year and a half, we’ve seen some tough times for the American economy.  We've suffered through a bursting stock market bubble, terrorist attacks on New York and Washington, and discoveries of corporate fraud.  We were wrestling with recession when President Bush entered office, and it took the better part of a year to shake it off, even as its consequences have lingered.  People have lost jobs, and retirement accounts are hurting.  Economic security is on all our minds.

Through all of this turmoil and hardship, the American consumer has continued to bolster our economy and American businesses have continued to innovate and improve productivity to prepare themselves for the next surge forward.  The extraordinary flexibility of our economic system and the spirit of those who work within it are key reasons for the brevity of the recession, and the steady march of our recovery.

American innovation – good ideas put to work – drives our productivity, creates jobs, and raises our standard of living.  I have seen many examples, as I have traveled to meet workers and visit businesses across the United States, of new ideas being put into practice to boost productivity, modernize communities, and create prosperity.

In Washington, we are working hard to support your efforts.  From the beginning of his Administration, President Bush has embraced economic freedom and individual accountability as the foundation for continuing prosperity.  His economic plan creates jobs, improves education and expands opportunities to save and invest.

First, the President's historic tax relief program last summer reduced taxes for the average family of four by $1,040 a year, and put cash in consumers’ pockets when we needed it most: last August and September.  Then in March, he signed the Job Creation Act to stimulate investment in our economy - a second major accomplishment.

 By the end of 2002, these two tax relief programs will have allowed the private sector to create an additional one million jobs with resources that would otherwise have gone to

Washington.

Our third victory for the economy has been new standards for corporate accountability.  These ensure that people saving for their future can get accurate information for sound investment decisions.  We are holding corporations accountable for telling the truth to investors and employees, so Americans can save for college tuitions and comfortable retirements with greater confidence.  I am confident the worst is behind us for corporate scandals – call them what you will, but I can’t believe any CEO still standing would be stupid enough to falsely certify their books.  Not when jail time is the certain consequence.

And the most recent major accomplishment for our nation's prosperity is winning Trade Promotion Authority, which the President will use to open international markets to US exports, creating jobs here at home. 

Today, key economic fundamentals such as inflation, real wages, productivity, interest rates, business profits, and the housing sector are all strong because of the resilience and determination of the American people, and the flexibility of our banks and financial institutions.   I am confident that we will return to 3 to 3.5% growth rates by the end of this year, and that growth will create jobs and renew our prosperity. But to a lot of folks out there watching, it doesn't feel like a recovery yet.  And the President won't be satisfied until everyone who wants a job has a job.  He's advancing the rest of his economic agenda to strengthen the recovery.

For nearly a year the President has been asking Congress to enact terrorism risk insurance.  Today, over $15 billion in construction projects are not going forward because of the lack of terrorism risk insurance.  Finishing this legislation is the single thing we could do in Washington to create jobs in the short run. We also need President Bush's Homeland Security plan, because the physical security of our nation is essential to prosperity.  The brief economic freeze immediately following September 11 demonstrated that reality all too well.  We are working with Congress to complete the new Department of Homeland Security, which would better organize and deploy our resources toward preventing further attacks.

We'll also work with Congress to restrain wasteful government spending, because overspending in Washington burdens our economy with higher debts and taxes.  And the President has called on Congress to protect individuals' control over their 401(k) holdings without undue constraints from employers.  Your retirement nest egg is yours alone - you earned it, and you should have full legal rights to control it.

The President’s concern for the health of our recovery led him to ask the courts to intervene in a labor dispute and reopen the ports on the west coast.  By some estimates, the port closures were costing the US economy as much as $2 billion a day.

 Plants were closing and workers were being sent home because important supplies were held up by the port closures.  We won’t know for some time the full effects on our economy of this 10-day disruption.  What we do know is that our economic recovery is crucial to the prosperity of all Americans, and the President acted decisively to prevent the recovery from being derailed.

As we emerge from the turbulence of last year's recession, we're gaining new perspective on the recent past, and we're applying that perspective to the decade still beginning.  In short, we are facing our problems, dealing with them as a nation, and moving forward.

The question for our new era is not whether we can or should continue the economic success we enjoyed in the 1990s.  The question is how leaders of business and government should incorporate the best aspects of the 90s - growth, productivity, and innovation - into the emerging decade, while actively working to make this new era a time of both personal responsibility and public integrity.  How can we reaffirm the link between value and values, and restore public confidence in American enterprise?  In my view, the answer is simple: honesty and accountability.  With leadership that respects and promotes these values, everything is possible.  Without it, nothing is possible.  That is as true for American corporations as it is for American government.  In my experience, the example from the top becomes the model for everyone below.

In the economic domain, I believe the connection between creating value and affirming values in American business has always been strong.  Far away from the headlines, most business leaders, from mom and pop shop-owners to corporate chiefs, have always treated their shareholders and employees with honesty and fairness.  Today, however, doing your job with competence is not enough.  Leaders must stand up and set an example not just for their employees, but for the general public as well.  Honesty in business is the new patriotism.  There is nothing better business leaders can do for this country right now than restore faith in the system that has made it great. The President's leadership at home and abroad is smoothing our road to recovery, and increasing the prospects for peace and prosperity around the world.  We will continue to pursue our vision, in which Americans have the greatest possible opportunity to live the lives we dream of: pursuing our chosen professions, owning a home, raising our children to be happy and successful, engaging in our communities, and attaining financial independence. 

Thank you.