Messages to Congress & Letter to Speaker of the House, March 10, 1981

Message to the Congress Transmitting Fiscal Year 1982 Budget Revisions

March 10, 1981

To the Congress of the United States:

On February 18, I spoke to a Joint Session of Congress about the economic crisis facing America. I pledged then to take the action necessary to alleviate the grievous economic plight of our people. The plan I outlined will stop runaway inflation and revitalize our economy if given a chance. There is nothing but politics-as-usual standing in the way of lower inflation, increased productivity, and a return to prosperity.

Our program for economic recovery does not rely upon complex theories or elaborate Government programs. Instead, it recognizes basic economic facts of life and, as humanely as possible, it will move America back toward economic sanity. The principles are easily understood, but it will take determination to apply them. Nevertheless, if inflation and unemployment are to be curtailed, we must act.

First, we must cut the growth of Government spending.

Second, we must cut tax rates so that once again work will be rewarded and savings encouraged.

Third, we must carefully remove the tentacles of excessive Government regulation which are strangling our economy.

Fourth, while recognizing the independence of the Institution, we must work with the Federal Reserve Board to develop a monetary policy that will rationally control the money supply.

Fifth, we must move, surely and predictably, toward a balanced budget.

The budget reform plan announced on February 18 includes 83 major cuts resulting in $34.8 billion outlay savings for 1982, with greater future savings. With this message, over 200 additional reductions are proposed. An additional $13.8 billion in savings are now planned. Further, I am proposing changes in user charges and off-budget payments that will bring total fiscal savings to $55.9 billion. This compares with $49.1 billion in fiscal savings announced on February 18.

In terms of appropriations and other budget authority that will affect future spending, we are proposing elimination of $67 billion in 1982 and over $475 billion in the period 1981 to 1986.

These cuts sound like enormous sums -- and they are -- until one considers the overwhelming size of the total budget. Even with these cuts, the 1982 budget will total $695.3 billion, an increase of 6.1 percent over 1981.

The budget reductions we are proposing will, undoubtedly, face stiff opposition from those who are tied to maintaining the status quo. But today's status quo is nothing more than economic stagnation coupled with high inflation. Dramatic change is needed or the situation will simply get worse, resulting in even more suffering and misery, and possibly the destruction of traditional American values.

While recognizing the need for bold action, we have ensured that the impact of spending reductions will be shared widely and fairly by different groups and the various regions of the country. Also, we have, as pledged, maintained this society's basic social safety net, protecting programs for the elderly and others who rely on Government for their very existence.

Budget cuts alone, however, will not turn this economy around. Our package includes a proposal to reduce substantially the presonal income tax rates levied on our people and to accelerate the recovery of business with capital investment. These rate reductions are essential to restoring strength and growth to the economy by reducing the existing tax barriers that discourage work, saving, and investment. Individuals are the ultimate source of all savings and investment. Lasting economic progress, which is our goal, depends on our success in encouraging people to involve themselves in this kind of productive behavior.

Our tax proposal will, if enacted, have an immediate impact on the economic vitality of the Nation, where even a slight improvement can produce dramatic results. For example, a 2 percent increase in economic growth will add $60 billion to our gross national product in one year alone. That $60 billion adds to the State and local tax base, to the purchasing power of the American family, and to the resources available for investment.

When considering the economic recovery package, I urge the Members of Congress to remember that last November the American people's message was loud and clear. The mandate for change, expressed by the American people, was not my mandate; it was our mandate. Together we must remember that our primary responsibility is to the Nation as a whole and that there is nothing more important than putting America's economic house in order.

The next steps are up to Congress. It has not been easy for my Administration to prepare this revised budget. I am aware that it will not be easy for the Congress to act upon it. I pledge my full cooperation. It is essential that, together, we succeed in again making this Nation a land whose expanding economy offers an opportunity for all to better themselves, a land where productive behavior is rewarded, a land where one need not fear that economic forces beyond one's control will, through inflation, destroy a lifetime of savings.

Ronald Reagan

The White House,

March 10, 1981.

Note: The message is printed in the report entitled ``Fiscal Year 1982 Budget Revisions, March 1981 -- Executive Office of the President, Office of Management and Budget'' (Government Printing Office, 159 pages).

The message was signed by the President on March 9 for transmittal to the Congress on March 10.

Message to the Congress Reporting Budget Rescissions and Deferrals

March 10, 1981

To the Congress of the United States:

In accordance with the Impoundment Control Act of 1974, I herewith propose 3 new rescissions of budget authority previously provided by the Congress, totalling $128.0 million. In addition, I am reporting 24 new deferrals totalling $825.5 million, and revisions to five previously reported deferrals increasing the amount deferred by $876.4 million.

The rescission proposals affect programs of the Department of the Interior and the National Consumer Cooperative Bank. The deferrals affect Appalachian regional development programs, programs in the Departments of Commerce, Defense, Education, Energy, Housing and Urban Development, Justice, Labor, and Transportation, as well as the Veterans Administration, the General Services Administration, and the Small Business Administration.

The details of each rescission proposal and deferral are contained in the attached reports.

Ronald Reagan

The White House,

March 10, 1981.

Note: The message was signed by the President on March 9 for transmittal to the Congress on March 10.

The attachments detailing the rescissions and deferrals are printed in the Federal Register of March 13, 1981.

Letter to the Speaker of the House Transmitting Proposed Supplemental Appropriations and Amendments

March 10, 1981

Sir:

I ask the Congress to consider proposed supplemental appropriations and amendments to pending supplemental appropriations for the fiscal year 1981 in the amount of $4,980,298,000 for program purposes, and reductions in the requests to cover the October 1980 Federal pay raise totalling $67,608,000; amendments reducing requests for appropriations for fiscal year 1982 by $22,134,673,463; and an amendment reducing a request for an advance appropriation for the fiscal year 1984 by $77,000,000.

These requests are part of my Economic Recovery Program.

The details of these proposals are set forth in the enclosed letter from the Director of the Office of Management and Budget. I concur with his comments and observations.

Respectfully,

Ronald Reagan

Note: The letter was signed by the President on March 9 for transmittal to Thomas P. O'Neill, Jr., Speaker of the House of Representatives, on March 10.