Yet there is much we can do--and must do. The proposals I bring before you are numerous and varied. They arise from the host of special opportunities and dangers which have become increasingly clear in recent months. Taken together, I believe that they can mark another step forward in our effort as a people. I am here to ask the help of this Congress and the nation in approving these necessary measures.
II. ECONOMIC AND SOCIAL PROGRESS AT HOME
The first and basic task confronting this nation this year was to turn recession into recovery. An affirmative anti-recession program, initiated with your cooperation, supported the natural forces in the private sector; and our economy is now enjoying renewed confidence and energy. The recession has been halted. Recovery is under way.
But the task of abating unemployment and achieving a full use of our resources does remain a serious challenge for us all. Large-scale unemployment during a recession is bad enough, but large-scale unemployment during a period of prosperity would be intolerable.
I am therefore transmitting to the Congress a new Manpower Development and Training program, to train or retrain several hundred thousand workers, particularly in those areas where we have seen chronic unemployment as a result of technological factors in new occupational skills over a four-year period, in order to replace those skills made obsolete by automation and industrial change with the new skills which the new processes demand.
It should be a satisfaction to us all that we have made great strides in restoring world confidence in the dollar, halting the outflow of gold and improving our balance of payments. During the last two months, our gold stocks actually increased by seventeen million dollars, compared to a loss of 635 million dollars during the last two months of 1960. We must maintain this progress--and this will require the cooperation and restraint of everyone. As recovery progresses, there will be temptations to seek unjustified price and wage increases. These we cannot afford. They will only handicap our efforts to compete abroad and to achieve full recovery here at home. Labor and management must--and I am confident that they will--pursue responsible wage and price policies in these critical times. I look to the President's Advisory Committee on Labor Management Policy to give a strong lead in this direction.
Moreover, if the budget deficit now increased by the needs of our security is to be held within manageable proportions, it will be necessary to hold tightly to prudent fiscal standards; and I request the cooperation of the Congress in this regard--to refrain from adding funds or programs, desirable as they may be, to the Budget--to end the postal deficit, as my predecessor also recommended, through increased rates--a deficit incidentally, this year, which exceeds the fiscal 1962 cost of all the space and defense measures that I am submitting today--to provide full pay-as-you-go highway financing--and to close those tax loopholes earlier specified. Our security and progress cannot be cheaply purchased; and their price must be found in what we all forego as well as what we all must pay.
III. ECONOMIC AND SOCIAL PROGRESS ABROAD
I stress the strength of our economy because it is essential to the strength of our nation. And what is true in our case is true in the case of other countries. Their strength in the struggle for freedom depends on the strength of their economic and their social progress.
We would be badly mistaken to consider their problems in military terms alone. For no amount of arms and armies can help stabilize those governments which are unable or unwilling to achieve social and economic reform and development. Military pacts cannot help nations whose social injustice and economic chaos invite insurgency and penetration and subversion. The most skillful counter-guerrilla efforts cannot succeed where the local population is too caught up in its own misery to be concerned about the advance of communism.
But for those who share this view, we stand ready now, as we have in the past, to provide generously of our skills, and our capital, and our food to assist the peoples of the less-developed nations to reach their goals in freedom--to help them before they are engulfed in crisis.
This is also our great opportunity in 1961. If we grasp it, then subversion to prevent its success is exposed as an unjustifiable attempt to keep these nations from either being free or equal. But if we do not pursue it, and if they do not pursue it, the bankruptcy of unstable governments, one by one, and of unfilled hopes will surely lead to a series of totalitarian receiverships.
