As I said this week in South Carolina, one word captures the difference between today and 1980: Hope. Hope is being reborn in America. We've been through some mighty rough waters during these first 2\1/2\ years, no doubt about that. But confidence is making a comeback. America is getting stronger. We're on a new road, a far better road, and we're not going back to the mess from before. And let's make sure that people remember that.

Indeed, a real mess was dumped in our laps. When we arrived in Washington, we felt a little like Noah must have felt the morning he left the Ark to begin all over again. And we've been fighting an uphill battle ever since to reduce Washington's hammerlock on our economy and our people. But we're making progress.

You know, I asked two questions during the last campaign, and you'll probably be hearing them thrown back at you in the months ahead. Are you better off today than you were before? Do you feel America is more secure today than it was? Well, I welcome those questions, and I hope you do too, because as I said this week in South Carolina, I think it's now time we held our heads high and made our case to the people. Yes, we're better off than before and, yes, America is more secure today than in 1980.

We've got a recovery train going, and rather than whine and complain, our critics should get on board and help us keep America moving forward. Why are we better off? Because 2.6-percent inflation over the last 12 months is one heck of a lot better than the 12.4 percent that we inherited; because an 11-percent prime interest rate is a big improvement over a 21\1/2\-percent prime rate; and because permitting the middle-income family to keep $700 more of the money it earns is better than the big, built-in tax increases condoned by the last administration.

Do you remember what the experts warned? They warned that if our plan passed, double-digit inflation was here to stay for the rest of the decade. They told us interest rates were sure to rise to 25 or 30 percent, and they said by decontrolling oil we would send the price of gas at the pump soaring. Well, they were dead wrong. Just as they have been so often in the past.

The truth is, America's future is looking better every day. For the first time in many years, America has the opportunity for a lasting, noninflationary economic expansion, and that's a lot better prospect than we faced in 1980.

Let's tell the truth about our critics. They sob enough about deficits to fill an ocean. But it's an ocean of crocodile tears. What they're after is a blank check for higher taxes, more spending, and greater control over the people's lives. They say they plan to talk about fairness. Well, fine, let them. Because those who gave America runaway spending, double-digit inflation, record interest rates, huge tax increases, too much regulation, credit controls, no growth, and excuses about malaise, are the last people who should be giving sermonettes about fairness and compassion. Families living on a fixed income of $10,000 at the start of 1979 saw the worth of that income drop to less than $8,000 by the end of 1980. In other words, inflation, which for years had been part of deliberate government planning, robbed them of $2,000.

That's not my idea of fairness. Perhaps that worst poverty is the poverty of their arguments. Thanks to the progress of our economic recovery program, real wages for the American worker have increased for the first time in 3 years. But you know, there's an easier way you can tell our critics are wrong and that our plan is working: They don't call it Reaganomics anymore.

That brings me to another point. We're making America safer for your families by rebuilding a military force that will bring peace through strength. Here, too, we have something important to remind the people. Our military forces had been dangerously neglected before we came in. In 1980 we had planes that couldn't fly, ships that couldn't sail, and troops that couldn't wait to get into civilian clothes. Our major weapons programs were being eliminated or delayed, and America was falling behind. But in Washington, the leadership lectured us on our inordinate fear of communism. Well, the savage Soviet attack against the unarmed Korean airliner is a reminder. We live in a dangerous world with cruel people who reject our ideals and who disregard individual rights and the value of human life. It is my duty as President, and all of our duties as citizens, to keep this nation's defenses second to none so America can remain strong, free, and at peace.

We are also pursuing arms control, and for the first time in history the Soviets are negotiating reductions of nuclear weapons, not just limits on their growth. We've undertaken the most sweeping proposals for mutual and verifiable arms reductions since nuclear weapons became a threat. In our search for peace, we have more major negotiations underway with the Soviets than any administration in history. In strategic nuclear forces and in measures to build confidence and trust, in intermediate-range nuclear forces and in conventional forces, we want to lessen the danger to ourselves and our children. We remain flexible in our bargaining. But as Commander in Chief, I have an obligation to protect this country, and I will not let political expediency influence these crucial negotiations.

I'll be the first to acknowledge that we still have a long way to go. Unemployment is still much too high, but that, too, is headed in the right direction. Two million jobs have been created since last December, and all indications point to more strength developing in the job market. In the meantime, we're doing everything we can to stimulate jobs.

Come October 1st, the Job Training Partnership Act will be in full force. It's designed to train more than a million Americans a year for productive, self-sustaining jobs in the private sector. We've also introduced another pro-jobs bill, the National Innovation and Productivity Act of 1983. This bill would encourage companies to work together on joint research and development projects to stimulate new products, new technology, and more jobs.

In that same spirit, we gave approval to a New England group of eight firms -- it's known as Small Business Technology Groups, Inc. -- to join forces to scout for high-tech government contracts, primarily in defense.

So, as I said, I think we can hold our heads high. You're the people who can spread that message, because no one has worked harder and given more from the heart for the cause that unites us than you. Our greatest challenges are to maintain control of the Senate and increase our numbers in the House. If we can do that, we can check the big spenders, keep America strong, and keep her moving forward on a road that's bold and filled with opportunity.

Let us remain united and true to the Republican vision of progress, a vision that begins with the people and their families, churches, synagogues, schools, and neighborhoods. We don't ask them to trust us. We say trust yourselves, trust the values that made us a good and loving people.

You are the key. So, I just want to thank you with all my heart for all your support. And I urge you as strongly as I can, keep doing what you do best so we can preserve freedom, prosperity, and hope in America.

Thank you so much, and God bless you all. And now I believe I'm supposed to take some questions.

Mr. Rollins. Yes, you are, Mr. President. I think there's nobody more fitting than George Clark, who is our 1976 Reagan chairman, who led the GOP delegation with 20 delegates that were pledged to you in 1976. He's been the party chairman in New York since 1981. He was the Brooklyn County chairman for 10 years prior to that, and he's a dear friend of both of ours.

George?

U.S. Marines in Lebanon

Q. Thanks, Ed. Hi, Mr. President. It's nice to see you, and please give our best regards to Nancy.

Mr. President, I have a two-part question. Number one, what is the role of our marines in Lebanon, and is there a time limit as to when they'll be home?

The President. Well, George, first of all, hello, and I'm delighted to have a chance even in this way to talk to you for a little bit.

Our role is what it was when we first sent them in as a part of the multinational force. As you recall, Lebanon, beginning back several years ago, had kind of come apart. The Syrians had moved in on one side. And then with the northern border of Israel violated by PLO attacks that were shelling and sending rockets across the border and killing innocent civilians, they had moved into Lebanon.

We, as you know, a year ago submitted a plan for peace in all of the Middle East and we set out with an effort to persuade the more moderate Arab States to recognize Israel's right to exist and then to come together and, in effect, create more Egypts, more nations that would sign peace treaties with Israel.

But first we had to restore the order in Lebanon or see it restored. You will recall that Israel, in its own defense, had moved all the way up to Beirut; the shelling was going on; Syrians were coming in from the other side; and there were several factions that over these several years in Lebanon had created militias, armies of their own, and were fighting each other. Well, the idea was that the multinational force would move in to be a stabilizing force as we persuaded the other nations to get out -- the PLO, the Syrians, the Israelis to get out of Lebanon. And then as a new government of Lebanon would attempt to regain control over its own borders and its own land, the multinational force would be there, as I say, as a kind of stabilizing force to help maintain order.

This is still the mission. Now, what happened was that Israel announced its intention to withdraw. The PLO, as you know, was ushered out of Lebanon. Then the Syrians -- who had said that when everyone would withdraw, they'd be a part of it, they would withdraw -- they reneged. And the Syrians stayed in. And there's no question but that they're influenced by the Soviet Union, which has put people in there, and weapons systems, and is urging them to support, and they are supporting, some of those internal Lebanese factions.

But we're there with the idea of maintaining order while the Lebanese Army -- which we in this same interim period have helped train, and it is an excellent force -- tries to restore the order, the internal order. Now they've been reinfiltrated by PLO that have come back in. The Syrians, as I say, are encouraging these groups and even supporting them with supplies and, we believe, sometimes manpower.

The one thing that has changed is the violence has struck at all of the multinational force. There have been casualties among all the nations that are involved there, including four marines killed and a number wounded. And we've given orders, and our allies in that force have given orders to their people, to defend themselves. And so we've been doing that. Now, as to a time certain for getting out, I don't know that anyone knows that. But at the same time, we do have very heavy diplomatic efforts going forward, with our representatives there trying to bring about a cease-fire in the internal conflict and then turn our attention to the Syrians and the others getting out of Lebanon.

There is some reason -- we have seemed several times to be on the verge of a ceasefire which would be the beginning of success in those diplomatic efforts. And I believe it is essential for the entire Middle East situation that we continue there. We've asked the Congress, or negotiated with the Congress for, I think, we have a bipartisan agreement on a longer period of time that is guaranteed if needed that they will be there, but they will be taken out the first minute that there is no longer a need for them to be there.

Mr. Rollins. Mr. President, our next question comes from the national committeewoman from Pennsylvania, Elsie Hillman. Elsie was very active in your 1980 campaign, and she was also the first woman county chairman of Allegheny County in Pennsylvania.

Elsie?

Allied Response to the Soviet Attack on a Korean Civilian Airliner

Q. Good afternoon. How do you do, Mr. President? We want to know how you feel about the frustration or the lack of willingness on the part of some of the member nations of the Atlantic alliance to support strong sanctions against the Soviets as a result of the tragic downing of the Korean airliner and, further, if there is further action planned by our government?

The President. Well, Elsie, I have to answer the first part of that question with mixed emotions, because never have the bulk of our allies in NATO been more united than they are today. And they have been in full support. Some of the things that people have suggested we should be doing about the Soviet Union are already agreed upon and have been done long before this tragic shootdown of all those innocent people; that is, with regard to high technology, we obtained last July agreement with our allies that we are all united in not delivering any high technology to the Soviet Union.

Last spring, we reached agreement with them on ending any more favored treatment with regard to interest rates in their trade with the Western World. So those things that some people are talking about today have already been done.

We are going to watch for, and continue in every effort that we can think of that might be effective in bringing them to the realization that this must never happen again, and bringing them to the admission of the wrong they've done and that compensation should be provided for the families of those who were victims.

So, we are in a measured way looking for every opportunity to do things. The mixed emotions come about because a few of our allies did not go along with us on some of the things that we're doing, particularly right now with regard to cutting off air traffic to the Soviet Union.

Mr. Rollins. Unfortunately, Mr. President, this will have to be our last question because Sandra Day O'Connor, your appointment to the Supreme Court, is waiting to have lunch with you.

The next questioner is Ed DiPrete. Ed is the mayor of Cranston in Rhode Island. He is the only Republican mayor in the State. He was first elected in 1978, and the last time he got 83 percent of the vote in 1982.

Administration Policies Toward the Poor

Q. Mr. President, what is your response to those who would say that this administration has been unfair to the poor?

The President. Mr. Mayor, thank you for asking that question. I'm sorry that I went so long on George's answer that I'm afraid I shut some of you off.

I think that whole talk about fairness with regard to our administration was begun and founded in or based in political demagoguery. Certainly, there are no facts to substantiate it. What could be worse for the people of lower income, what could be worse, as I pointed out in my remarks, that, say, someone who had $5,000 fixed income in 1979, at the beginning of the year of '79, and by the end of the year 1980, in just 2 years, that was only worth $4,000 in purchasing power? That's a pretty big blow.

We have set out and, as I have pointed out in my remarks, been pretty successful in reducing that double-digit inflation and bringing it down to where it is. For the first time, people's real income is actually increasing. Now, this has to benefit the people at the lower income level more than anyone else, because they were the ones that were suffering the most from this continued depreciation of the dollars that they had. And we're going to continue with that kind of a recovery.

Our tax program, they've said, ``Oh, this benefited the rich.'' They can't substantiate that. It was across the board, the same percentage cut. Had it not been across the board and the same percentage cut, then that tax cut would have further increased the progressivity of the tax structure. My belief is that those on the other side of the aisle who want to increase progressivity of, say, the income tax, should have the courage to stand up and propose that. They shouldn't try to sneak it in by an unbalanced reduction. We wanted it to be fair, across the board.

But many other things have been done. I know that some of this is based on our budget cuts, and we've never gotten all that we asked in that regard, and we're still going to try for more. They're necessary if we are to reduce the deficits that are looming on the horizon. But what they fail to mention is that we are feeding more people who need help in nutrition than ever before in history. We're feeding more school children with free school lunches -- some 10 million of them. We're buying meals for about 50 million people. We're supporting housing for 10 million people.

In all of these, the figures are up to the highest point they've ever been in our nation's history. What they are distorting is the fact that in all of these areas of help, we discovered that the way the programs were being administered, there were many people who were receiving help from their fellow citizens who didn't deserve it because their incomes were as high, and in some instances higher, than many of their fellow citizens who were supporting them through their tax dollars.

So, we redirected the effort toward the truly needy. This was even true in our education programs, in providing grants and loans for students to get college educations. We found there were people getting those loans who could well afford to send their sons and daughters to college and who were reinvesting that loan at a low interest rate in government paper paying a higher interest rate and making a profit on the whole deal.

We changed that. And as I say, we redirected all of this aid, including food stamps. We found more than 800,000 people getting food stamps who had no legitimate or moral reason to be getting them. But we have increased the total number of people that are getting food stamps and the total number of dollars that we're spending on those food stamps -- all redirected to people at the lower earning level.

So, they don't have a leg to stand on on any charge of fairness. What they should be defending is, how could they call it fair to have gone along with their deliberate, planned inflation and their deficit spending? You know, with their sobbing about the prospective deficits now, are we to forget how they used to tell us that the national debt didn't matter because we owed it to ourselves and that deficit spending was necessary to maintain prosperity? Well, by the time we got here there wasn't much prosperity. Now I campaigned in cities in this country where the unemployment rate then was 20 percent, and the present recession was just a worsening of the recession that was already underway. And that was hurting people unfairly.

Mr. Rollins. Thank you, Mr. President.

Q. Mr. President, we are thankful that you have spent a few moments with us today. And as I discussed with you when I chatted with you from Scottsdale in the Western States Conference about a week ago, the message here from the Northeast Republicans is the same, and that is, ``Four More in '84,'' Mr. President.

The President. You understand why I don't respond to that answer right now, but we'll be talking about that before too long.

Note: The President spoke at 12:10 p.m. from the Diplomatic Reception Room at the White House to participants in the conference, which was held at the Mayflower Hotel.

Edward J. Rollins is Assistant to the President for Political Affairs.