Nancy and I -- I'm sure you know how thrilling this is for us to be back here in home territory. I once said that the roots go very deep in the blue-black soil of Illinois prairies. We're delighted to be here, and I thank you for that fine welcome.

Somebody did quite a research job, though, to find a picture of me in the Dixon YMCA band. [Laughter] This should lay to rest the rumor that photography had yet to be invented when I was that age. [Laughter]

Seriously, I recall those days with pleasure. Dixon, a small town and back then the entire community got behind projects like the YMCA Band. My family didn't have any extra money, so I've always been grateful for the wonderful time such programs provided me.

Something I didn't understand as a kid was the part our neighbors and other good folks in Dixon played in that band -- the mechanic down the street, the shopkeeper, the telephone man. They realized that they had to do their part if our little town was to be a decent place. So, they got involved, and they contributed the money. And when they didn't have that, they gave of their time so the kids in our town would have a YMCA band. The gentleman in the dark coat up there was the teacher, and he was the one who conceived the idea and literally, single-handedly brought it before the town. And there weren't school bands in those days, and so that was the band.

But that's the kind of spirit America stood for back in those days. It's the kind of spirit that all of you stand for today. Come to think of it, that band was my first real experience in entertainment. [Laughter]

I remember one day when we went to a nearby, even smaller town for Memorial Day to lead the parade, and a gentleman, who was the parade marshal on a white horse, as we started, galloped back down the line to make sure everyone was joining in and coming along. And we were leading. And I was the drum major and waving my baton, and suddenly I thought the music was sounding fainter. [Laughter] And I looked over my shoulder and found that he'd come back up to the head of the parade in time to get the band turned at the corner. I was going down the street all by myself. [Laughter] So, I cut across corners and got in front of them again. I'm still trying to do that with the Congress. [Laughter]

But I might have been too young to express my appreciation to all my good neighbors back then, but not now. So, if you will, I hope you'll accept the thanks from me, not only for what the YMCA provided in Dixon but for all those many young people, most of whom you'll never know, but all of whom will live happier and healthier lives because of the efforts that you're putting forth to make this the kind of city, the kind of country that we believe it should be. And if one of the kids you're helping along grows up to be President some day, I can assure you that he'll think back and realize how much he owes to good people like you.

The character of the American people is our country's most precious asset, and, like any asset, it should never be taken for granted. In the months preceding the 1980 election the values of which I'm speaking and the viability of some of our most cherished institutions, I believe, were under attack as never before. Inflation, high taxes, and economic instability were taking a heavy toll on things which most Americans had always taken for granted.

Our savings rate slipped to the lowest level of any major industrialized nation. Instead of long-run, job-producing investment, money was being channeled into inflation hedges and tax shelters that made little contribution to the economic strength of the country. The quick deal and the fast buck were rapidly becoming the order of the day.

Inflation was ripping our country apart. Federal taxes were draining the potential for growth and progress out of the private sector. Interest rates, as we know, shot sky high to 21\1/2\ percent in December of 1980. This is what we confronted upon entering office 16 months ago.

Our people cried out for a change of direction. Above all, if we were to recapture the spirit of vigor, optimism, and brotherhood that was once the hallmark of our country, America needed to change attitudes.

One of the most damaging attitudes which had developed, one that may be at the heart of our other problems, was the habit of turning to government to solve every problem. It caused unprecedented government growth that threatened our very way of life and brought the harmful side-effects I've just described. Over the last decade Federal spending tripled at the same time that defense spending decreased in constant dollars. Federal social spending increased over the last three decades eight times more than prices.

Some of the programs established during that spending binge remind me of the preacher who had come to a small hamlet about a hundred miles from his own hometown to preach at a revival meeting. And driving into the village he noticed a man from his own community, a fellow that was rather known for his drinking, who was sitting on the front steps of the general store. And he stopped his car and he asked the drinker why he was so far from home and was told that beer was 5 cents a bottle cheaper there. Well, when the minister pointed out the cost of travel back and forth, the price for a hotel room, the beer drinker retorted, ``I'm not stupid, Reverend. I just sit here and drink till I show a profit.'' [Laughter] Well, some of the government programs of the last 20 years were ill-conceived, too costly, and turned out to be no better for the poor than that bargain beer.

Inflation and economic dislocation resulting from uncontrolled spending and the taxation needed to pay the bill hurt everyone. And the figures back this up. If inflation had kept running at the rate it was prior to -- or during 1980, a family of four on a fixed income of $15,000 would be over $1,000 poorer in purchasing power today. The effect would be the same as having that $15,000 income reduced to $14,000. Or put another way, by lowering inflation we gave them a thousand-dollar raise.

In January of 1980, the Consumer Price Index was increasing at an annual rate of 18 percent. That would have more than doubled prices in 5 years and devastated our economy. Two years later, in January of 1982, the Consumer Price Index went up at a rate of only 3\1/2\ percent. And in March it actually fell for the first time in nearly 17 years. It would have been no favor to the poor, or anyone else, to permit inflation to continue ravaging our country.

How many of you remember that it wasn't so long ago that voices of gloom and doom were suggesting it would take a decade to bring inflation under control? There was an unprecedented feeling of pessimism sweeping across the country. For the first time you could hear the refrain that America's best days are behind us. Well, don't you believe it.

This negative thinking is similar to that found in a letter from a high school teacher recently published by a newspaper columnist. ``Since 1967,'' the letter says, ``I have watched sloppy, indolent, sassy, unmotivated students virtually sleepwalk through school. I won't go into detail about the lack of respect for authority or the students that I have seen stoned, spaced out, still drunk on Monday morning. More than once, I've been tempted to accept the label `teacher burnout' and change jobs.''

But then something happened to dramatically alter this teacher's entire perspective. She works in Fort Wayne, Indiana. And a few months ago they suffered the worst flooding in 69 years. And she writes, ``Like thousands of others I went downtown to help, and what did I see? Hundreds of students whom I'd written off as lazy, irresponsible. They had come as volunteers to work in the sandbag lines, haul rubble and trash, help evacuate the elderly and stranded, do whatever needed to be done. Some were even ready to risk their lives if necessary.'' All those kids had needed, the teacher concluded, was a sense of purpose, and now they had one.

Well, I was in Fort Wayne during that flooding, and I can testify to what this teacher is saying. The same is true of young people all across America, and not just the young people either. But I could tell you, a few years ago was something I wanted to see on a billboard. We were having a problem in California. Unnatural high tides abetted by storms were destroying beautiful beach homes along the beach, and the television was covering, around the clock, the battle to save these homes -- sandbag lines again. And it was about 2 o'clock in the morning, and there was a young teenager just in swimming trunks, and at 2 o'clock in the morning in California you can freeze to death. He was wet, he was obviously tired, and one of the commentators of the TV station stopped him as he's hauling another sandbag, asked him did he live in one. No, he didn't live in any of those homes. Why was he doing it? And the answer is what should have been on a billboard. He stopped for a minute, kind of puzzled himself, and then he said, ``Well, I guess maybe it's the first time we've ever felt needed.''

We ought to be able to do better for them than that. Anyone who writes off Americans is making a tragic error. More often than not our citizens are simply waiting to be asked. And that's one of the reasons why back in October we created a Presidential task force on private action -- on private sector initiatives. There are still too many people on the sidelines waiting for a chance to get into the game.

This task force is designed to serve as a catalyst for people-helping and community-building projects. It's not designed to replace government. The Federal Government will continue playing a significant role.

Federal social spending is still increasing, although admittedly at a less rapid pace than before. The Department of Health and Human Services, for example, will have a budget of $274.2 billion in 1983, when we get that budget passed -- and we're going to get it passed. Now, that's an 8-percent or $20 billion increase over 1982. That's $56 billion more than the defense budget. The HHS budget is, in fact, larger than the entire budget of any country in the world except the United States and the Soviet Union.

But while maintaining government's commitment to the poor, we want to see if it isn't possible to motivate our people as individuals, as members of churches and clubs, as representatives of corporations, as members of unions, and as concerned citizens, to do what they can to make this a better country. How? By working together in partnership to meet community needs.

This theme of building partnerships is one of the major goals of the task force, and I understand this effort is now running at full throttle. One of the earliest pioneers of this spirit was Benjamin Franklin, a wise old man of the American Revolution. ``For my part,'' he is reported to have said, ``when I am employed in serving and understanding others, I do not look upon myself as offering favors, but rather as paying debts. I have received many kindnesses from my fellow men. I can only return those to their fellow men. And so let good offices go round and round, for mankind is all of a family.''

Well, Franklin was more than a man of words. He was also a man of deeds. As early as 1727, with a small group of his Philadelphia friends, he formed a mutual improvement society called the Junto. And within a few years, they founded a subscription library for their community -- the first of many projects.

This was truly a New World, and with it came this new spirit of personal responsibility, unleashing creativity and energy that astounded the world. In the 1830's Alexis de Tocqueville, a young French intellectual, traveled through our new country recording his observations in his book, ``Democracy in America.'' The American way of life captured his imagination, especially the vitality with which our forefathers went about solving problems. You know, there's something strange in the United States, he wrote. He said, when individuals see a problem, they walk across the street to a friend or a neighbor, and they tell them of the problem. And they talk about it, and pretty soon a committee is formed. And the next thing you know, they're solving the problem. And then he added to his fellow Frenchmen, you won't believe this but not a single bureaucrat was involved.

De Tocqueville noted that ``wherever, at the head of some new undertaking, you see the government in France, or a man of rank in England, in the United States you will be sure to find an association.'' Well, the Young Men's Christian Association, although born in England, is exemplary of this tradition that has been so vital to our freedom and well-being.

The YMCA right here in Chicago is a tremendous example of what can be accomplished. Since 1858, through good times and bad, you've been serving the needs of the people of this city. The first job-placement service in Chicago was launched by this YMCA when it was only 2 years old, back in 1860. In the latter part of the last century when new immigrants needed a helping hand, the Chicago Y offered Americanization and English classes, not only in its centers but also in south Chicago steelmills. Later, the national Y loaned six of its professionals -- two from Chicago -- to help establish the Boy Scouts of America. And I can remember how, at the beginning of World War II, the Y joined with five other agencies to establish the USO. The Chicago Y became the home away from home for thousands of American soldiers and sailors.

Today, the YMCA represents the largest voluntary human service agency in the country, a public-private partnership that should serve as a model for others. I understand you've got over 1,100 full-time staffers, over 3,100 part-timers, and more than 10,000 volunteers.

The Y has played an indispensable role in this city. Your current undertaking demonstrates that the Y is ready to meet the challenges of the future. Aimed at strengthening your city's neighborhoods and offering much-needed services to Chicago's urban population, this program represents the kind of private-sector partnership our task force hopes to spread to other communities. I applaud your commitment and good citizenship. Your presence is testimony that Chicago can still show the rest of us how to make a large city work.

Our Task Force on Private Sector Initiatives is aimed at promoting just this kind of direct action. It's headed by Bill Verity, former chairman of the board of Armco Steel, and a man who knows how to get things done. We set out 6 months ago to systematically build upon the tradition of voluntary action that I've spoken about today. The progress, so far, has been impressive.

In the last few months I've met with more than a hundred leaders of the largest national business organizations and trade associations, leaders from a hundred of the largest religious organizations, and leaders from a hundred of the largest service and fraternal organizations to see what can be done to strengthen the efforts being made and to encourage others to get involved.

For our part we've instructed the head of every department and agency in the Federal Government to appoint a personal representative to determine what can be done to promote private-sector action and to report the findings to our task force and to the White House. I'm happy to say that we've had tremendous cooperation at the Federal level, and there's been significant progress made at the State level as well.

Over 20 Governors are working with our task force and have taken steps to establish private-sector task forces in their own States. And today Governor Thompson informed me that he is announcing today the creation of his own Illinois Statewide Task Force on Private Sector Initiatives.

We're discovering heartwarming dedication among our citizens all over the country. The AFL-CIO is a good example. They've demonstrated leadership not only during labor negotiations but also in organizing a host of worthwhile community projects. The AFL-CIO has a network of 310 full-time labor community service representatives working to address local needs in 196 cities. Some of these representatives are heavily involved in assisting those who've lost jobs because of the current recession.

Working people have always demonstrated tremendous responsibility. Approximately 68 percent of the United Way budget is contributed by individual workers. One third of all blood donated to the Red Cross comes from union members. And the Scouts tell me that union members represent 25 percent of the leadership of the Boy Scouts of America.

And business is doing its part, too. From all areas of the Nation our task force is collecting information about corporations taking the initiative. The success of this effort today is due in large degree to the contributions of numerous businesses large and small. To be safe, I'll refrain from naming names, because I know there just isn't time to acknowledge each of you. But if one person deserves applause for his efforts today, it's your chairman of the board of managers, Edward S. Donnell.

And corporations don't necessarily have to contribute money. Of the 10 senior staff members on the task force, 9 of them are loaned executives whose time is being volunteered by their employers. And this summer, as in the past, many corporations will be taking the lead in providing summer jobs in the private sector for disadvantaged youths. John Filer, chairman of the National Alliance for Business and a member of the task force, tells me that private industry, despite our current economic problems, this summer will provide more jobs to needy kids than ever before.

Let me give you just one splendid example of management and union working together. Members of the International Union of Operating Engineers in Philadelphia heard that the Easter Seal Rehabilitation Center badly needed some specialized equipment for severely disabled children. They went to their employer, the Rohm and Haas Company, and together they cranked out the needed devices professionally, built for strength and safety. It's estimated that 2,000 children will benefit from the efforts of these volunteers.

America's churches have also been in the forefront of service to the less fortunate. Christ told his disciples that ``as ye do unto the least of my brethren, so you do unto me.'' The message was clear; you serve God by serving those in need. As late as 1935, in the middle of the Great Depression, a substantial portion of all charity was sponsored by religious institutions.

Now, you might think this is just my interpretation, but in the parable of the Good Samaritan, the Samaritan -- and I think this is the meaning -- didn't run into town to look for a government caseworker to help the injured pilgrim. He acted directly to do what he could to help, himself. We think it'll be good for the soul of this country to encourage people to help one another, to get involved, to take personal responsibility for the well-being of their community and neighbors, instead of always leaving this to the bureaucracy.

American churches demonstrated this as they rushed forward to aid the throng of refugees entering this country after the Vietnam tragedy. Five religious organizations were responsible for settling two-thirds of the Indochinese refugees who entered the United States.

Americans have always been ready to help those in need -- whatever country they come from. We can be proud that our citizens through private voluntary organizations like CARE, World Vision, and many other humanitarian associations, have helped eliminate suffering -- feeding the hungry and treating the sick in every corner of the world.

The list goes on and on. The service clubs -- Kiwanis, Lions, Rotary, Jaycees, and others -- all have a history of community support. And Bill Verity tells me that they're doing even more in response to the challenge of our task force, and they're doing it more efficiently and effectively than the Federal Government ever could.

I just wish those who are pessimistic about the future of America could see an overview of this surge of creative and humanitarian action. We believe it should be recognized, encouraged, and promoted. And that's why we established the President's Volunteer Action Awards and brought this year's recipients to the White House.

One of those given the award was a man named Bill Sample. Bill was a Philadelphia policeman assigned to a local children's hospital. He saw the desperation -- financial and emotional -- of those with seriously ill children. Originally he did what he could out of his own pocket, and then he established the Sunshine Foundation to get others involved. The Foundation helps with expenses and, whenever possible, fulfills the child's dream -- sending the little boy or girl to Disneyland or on a boat trip down the Mississippi. Today the Sunshine Foundation depends on 200 volunteers working in 7 chapters in 3 States. And whoever said that cops don't have a heart?

A major goal of the task force is to get the word out about good people like Bill Sample. Unfortunately, the news media, by and large, has been missing the biggest news story of the year: the surge of creative, innovative, problemsolving activity at the local level.

I recently met with representatives of 30 of the country's largest broadcasting groups and told them how one station, KAKE - TV, in Wichita, Kansas, was able to play a leading role in its own community. The news teams of KAKE focused in on some local problems and then called other cities to find ways that they were able, by enlisting support from private-sector and partnership efforts, to tackle those problems. And after hearing about what KAKE had accomplished, the broadcasters enthusiastically endorsed the concept and told me their stations would try to emulate the effort in their own communities.

In short, there's much to be done. And while no one is capable of doing everything, everyone is capable of doing something.

I'd like to close with this thought. During the campaign I talked about family, neighborhood, work, peace, and freedom. And it wasn't just campaign rhetoric. And I say to you in utmost sincerity, it's time for us to return to some of these basic beliefs.

It won't be easy; it'll take commitment, hard work, and perseverance. But how great the results can be. And you in Chicago know the importance of neighborhoods. You were once known as the city of neighborhoods. Well, this project today is a wonderful display of community spirit and support for something that you believe in. Fundamentals like this, which have played such a significant role, cannot be replaced whole-horse by Federal programs and paid bureaucracy.

Thomas Jefferson, the author of liberty, the father of our freedom, once wrote, ``I deem it the duty of every man to devote a certain portion of his income for charitable purposes; and that it is his further duty to see it so applied as to do the most good of which it is capable.'' Jefferson knew well the relationship between the responsibility of which we speak today and the freedom of our people.

Another great American, Dwight Eisenhower, saw this when he quoted that young Frenchman, de Tocqueville's line: ``America is great because America is good. And if America ever ceases to be good, America will cease to be great.''

All of us are aware of the reservoir of goodness which lies waiting to be tapped. Let's make it our job -- everyone's job -- to encourage our fellow citizens to do those good works which need to be done. With the help of God we can and we will keep America the great and the free nation that it is.

Thank you again for what you're doing and for your presence here today. God bless you.

Note: The President spoke at 1:27 p.m. in the International Ballroom at the Conrad Hilton Hotel. Prior to his remarks, he attended a reception for luncheon headtable guests at the hotel.