Today we post the first half of President Ronald Reagan’s speech to the Presidential Task Force on Project Economic Justice on August 3, 1987. This is a follow-up to the extract from the strategy paper, “Project Economic Justice: A Beachhead for Regional Infrastructural Reform,” which led up to the work of the Task Force. For those interested in seeing and hearing rather than reading, here is the video of the speech:
President Ronald Reagan’s Speech on Project Economic Justice
Transcript of Speech Presented at the White House
Washington, D.C., August 3, 1987
Washington, D.C., August 3, 1987
Thank you. First and foremost, I would like to express my appreciation to Ambassador Middendorf, Norm Kurland, and the members of the Task Force for the time and effort they contributed to this project. Perhaps they could stand. Thank you.
Scientists say a perpetual motion machine is impossible. Well, considering that this task force completed its work without any appropriation from Congress, I think we ought to introduce Bill Middendorf to a few scientists.
This country’s ultimate resource is the creative talent, hard work, and entrepreneurial spirit of individuals like Bill Middendorf, and like many of you here today. The American character-and that is what we are talking about-is no accident, no fluke of nature.
It was nurtured by the political and economic liberty that has been hailed and protected by generations of Americans. It is the source of power that turned a vast wilderness into an economy that has provided more opportunity and a higher standard of living for more people than any other in the history of mankind.
Today the pivotal relationship between freedom and economic progress is becoming ever more apparent. The root cause of stagnation in the developing world, clearly, is not a lack of resources, but a lack of freedom. In Ethiopia, for example, it has been the Communist Dictatorship even more than drought that has brought about such suffering and hunger.
In so many countries, what will change despair into confidence, deprivation into plenty, stagnation into upward mobility, is a commitment to human freedom and an understanding of how that relates to the economic progress of mankind.
We see evidence of this is the great progress taking place on the Pacific rim. There, competition flourishes, the market is less controlled and the people are freer to invest and to engage in enterprise. They are more confident that they will be permitted to enjoy the fruits of their labor. Freedom of enterprise at an individual level builds countries from the bottom up. A lack of it, on the other hand, has the opposite effect.
Economist and businessman Hernando De Soto conducted an extensive study of the economy of his native Peru that confirms this. He found the greatest impediments to progress in his country are laws, regulations, and government controls that suppress the common people’s entrepreneurial activities and prevent social and economic mobility. Those trying to improve their lot are hurt the worst.
Mr. De Soto describes how it took a lawyer and three others 301 days of full-time work, dealing with 11 Government Agencies, to get through the red tape necessary to put into business one small garment-making shop in Lima, Peru. According to Mr. De Soto, when the forms and paperwork were laid end-to-end, they measured 102 feet.
One researcher working on the project then tried the same experiment in Tampa, Florida, the entire process took 3-1/2 hours.
The controls and restrictions Mr. De Soto talks about are certainly not unique to Peru. Such Government intervention is often well-intended, but, in the end, it does not serve the needs of the people, as producers or consumers.
Far too many third world countries are immobilized by the policies that smother individual initiative and drain the private sector of resources. Instead of controlling the energies of their people, lesser developed countries should be freeing up and unleashing those energies.
Andres Bello, an intellectual giant of the last century, once said: “Liberty…gives wings to the spirit of enterprise wherever it meets it, it breathes breath into it where it does not exist.”
There is no reason to believe that the citizens of most countries with struggling economies are not as bright, hard-working, and capable as those in countries which are enjoying great progress, like on the Pacific Rim. If an environment is created where enterprise can thrive and a profit can be made, investment will flow, jobs will be created, production will increase, and everybody will be better off.
Our Government’s International Programs at Treasury and A.I.D. in recent years have been molded to promote just such growth-oriented policies.
There has been a crying need, however, for creative and innovative thinking in regard to economic growth in Central America. That is where the Task Force for Project Economic Justice comes in.
We are all aware that Central America is today on the front lines of battle for human freedom. The security of our country and the stability of the hemisphere are tied to events in that volatile region. We’ve provided our friends there with the weapons and military equipment needed to counter an on-going strategic move by the Soviet Bloc- which, I might add, pumped in more than $1 billion of military and other support to its puppet regime in Nicaragua last year alone.
But don’t let anyone tell you we are relying on guns alone to carry the day. Our friends in Central America must have the weapons they need to survive, but, if they are to win, if freedom is to be secure, the Central American Democracies must have strong, growing economies. Let me reaffirm to all of you, our commitment to counter communist aggression in Central America will not diminish our efforts to meet the economic challenges that confront the people of that troubled region.
(To be continued.)