Ronald Reagan Second Gubernatorial Inaugural Address

January 4, 1971

Lieutenant Governor Reinecke, our fellow constitutional officers, leaders and members of the senate and assembly - my fellow Californians:

Remembering our last meeting here under these same circumstances and in spite of the general belief that pain cannot be re-lived in memory, I recalled the cold of that day 4 years ago and decided that cold’s ability to shrink and contract should be applied to my remarks. We will soon be indoors and thawed out!

I do not know whether time has a faster pace in Sacramento than elsewhere but these four years have gone by more swiftly that they did when I marked a four-year term as the period from Freshman to Senior. And yet in this four-year span we have plumbed the ocean depths and reached out to the stars. We have lived for extended periods on the ocean’s floor and have walked on the surface of the moon. In fact I have been up in the air a few times myself and once or twice sought advice about living under water.

But it is almost a cliché to remark that we live in a time of accelerating change. Events once measured against a lifetime are compressed into a decade or even a year. Space and time and distance have been both stretched and shrunk and yesterday is but a preview of tomorrow.

Yet with all the change, some things remain the same. Our goal, for example, of promoting the well being of our people within a more just and perfect union – you will note I said promote not provide.

On that day four years ago, I asked that we set foot on a path leading toward a Creative Society. We have traveled that road since and with all my heart I believe we should continue. It turns away from increasing reliance on government and leads toward renewed respects for – and greater reliance on – the collective genius and common sense of the people.

It is not always an easy path because, by design, it demands as much from those who elect, as it does from those who are elected. This is of course the very reason it is a good road to follow. When those who are governed do too little, those who govern can – and often will – do too much.

When we first set foot on that path I expressed a belief that the most meaningful words in our Constitution are three in number, contained in the phrase, “We the people.” Those of us who faced you from these historic steps then, and we today who have been elected to constitutional office or legislative position, are in that three word phrase. We are of the people, chosen by them to see that no permanent structure of state government ever encroaches upon freedom or assumes a power beyond that freely granted by the people.

We have just gone through the ritual of election. By mandate of the people the power to govern will be shared. Control of the Legislature rests with representatives of one party and most of the constitutional officers and executive branch are of the other. To conclude pessimistically – as some have – that little progress can come from such a situation is to deny the value of the two-party system which has served us so well. Those who mournfully predict there will be little constructive action during this session of the Legislature do an injustice.

Now I do not mean to suggest there will not be certain differences of opinion and even some spirited debate in the days ahead. But I have no doubt that together we can conduct the people’s business in a constructive and effective way. In the first place, the people of California sent us here to do just that. And in the second place, our situation with regard to the division of power and authority is little different than it has been for these past four years and together we have accomplished much in those years.

Unhindered by party lines, one of the great engineering feats of all time, the California Water Project, is nearing completion. We have continued to add to our network of modern high speed highways and freeways and with every added mile we have saved the lives of our citizens.

While traffic fatality rates climb in the rest of the nation, ours continues to decline.

Our state has shown the way in environmental protection. Much remains to be done of course, but we are meeting the challenge. Legislation needed in the fight against air and water pollution has been provided and we are united determination to preserve the magic beauty of California.

With the entire nation plagued by runaway crime rates and bulging prisons, our major California cities report a reduction in crimes of violence.

Our rehabilitation policies and improved parole system are attracting nationwide attention. Fewer parolees are being returned to prison than at any time in our history and our prison population is lower than at any time since 1963.

It is the same in mental health where the number of hospitalized mentally ill patients is half what it was four years ago.

Since the tax increase of 1967, more than 40 pieces of legislation have been passed easing the tax burden. More than 5 percent of the annual budget is money returned directly to the homeowner.

The Creative Society has demonstrated its ability to reduce the size of government. The cost of actually administering state government has increased less than the increase in inflation alone. At the start of the fiscal year, there were fewer full-time employees than there were four years ago, and the press reported the other day what may be a first in the history of government – a great reduction in the annual accumulation of paper to be filed and stored.

All of this has been accomplished neither because of, nor in spite of, partisanship which explains my optimism that progress will continue.

This brief re-cap was not intended to gloss over or minimize the very real problems confronting the people and government of California. Still unsolved is the absolute necessity of sizeably reducing the tax burden of home owners.

This is complicated by the state’s fiscal situation. A subject which cries for more light and less heat. So far, too many explanations and interpretations have been couched in the rhetoric of campaign oratory. Confusion has led to uncertainty and fear. There is cause for neither.

One week from tomorrow I will appear before a joint meeting of the state legislature, the Senate and Assembly combined, to discuss in some detail and make public the full extent of our money problems. In the meantime some clarification here and now is appropriate.

The group of economists and business experts, who for 25 years have been forecasting revenues and expenditures upon which state budget are based, revised their estimate of expected tax revenues downward last June as a result of the general slow-down in the economy. There have been two revisions since – in late November and mid-December – further reducing estimated revenues.

This slump in tax revenues, however, is not our greatest problem. It just aggravated a situation that has been growing worse year after year. Welfare costs have been increasing more than three times as fast as revenue and in this present year have escalated at an even faster rate. Californians do not have to worry about proving their generosity and compassion for their less fortunate neighbors. On a per capita basis, we spend more than double the national average for welfare. In spite of this, we must face the fact that welfare has failed in its purpose. For the truly destitute among us it is a tragic failure. It has done little or nothing to eliminate the cause of dependency and it has spread itself so thin that in spite of its overwhelming extravagance, many whose need is the greatest are provided less than a minimum subsistence.

Under the aid to dependent children program, incentives are offered to encourage mothers to take employment. There can be no quarrel with this unless we look closely at how the incentive and complex regulations actually apply. A recent survey of 3 counties, representing 48% of the welfare caseload in California (Monterey, Los Angeles and San Diego Counties), showed the earnings or outside income of employed recipients averages $346 a month and the average grant from welfare, added to those earning, is $186 – for a total average of $532 a month. However, the survey also disclosed mothers of dependent children who have no outside income receive average grants of $207 – only $21 more than the grant to those with outside income in order to increase our ability to help the totally dependent.

Mandated by statute and federal regulation, welfare has proliferated and grown into a Leviathan of unsupportable dimensions. We have economized and even stripped essential public services to feed its appetite. Now the economic downturn has brought us to the moment of truth we have avoided for too long a time.

It has already been suggested that we meet this situation by simply adding to the taxpayers’ heavy load. That of course is an easy out – for everyone but the taxpayer who already pays too much for government.

I’m inclined to believe you didn’t send us here to find easy answers. A tax increase – even under the illusion that it would be a temporary expedient – will not resolve this problem. In the first place, temporary taxes have a way of outliving the problems that caused their birth. Government may protest that it never gets the money it needs, but it always manages to find a need for the money it gets.

Simply meeting this problem by finding additional funds, or passing it on to another level of government, is truly a temporary solution. Unless and until we face up to, and effect complete reform of welfare, we will face a tax increase next year, the year after, and the year after that – on into the future as far as we can see. There is no limit to the potential growth of the present welfare structure, short of total redistribution of the earnings of all who earn and produce.

We are faced with a choice. We can be depressed by a seeming fiscal crisis, or we can recognize this as the opportunity it really is. Let those who will wring their hands and cry doom. They will not be typical of our people.

We have a chance to do what might otherwise never have been done. Over the years we’ve talked about welfare, studied welfare, applied alterations and streamlined it’s administration where possible, but we’ve avoided facing up to it’s lack of a goal. Seneca said, “He who knows no port to sail for, finds no winds favorable.”

In the coming meeting with the legislature eight days from now, I shall propose restructuring welfare – to eliminate waste and the impropriety of subsidizing those whose greed is greater than their need. The present confusion must be replaced with a program designed to save, rather than destroy, California’s greatest resources – its people – a program that will maximize human dignity and salvage the destitute.

Here in California nearly a million children are growing up in the stultifying atmosphere of programs that reward people for not working, programs that separate families and doom these children to repeat the cycle in their own adulthood.

I believe we can change this. There is no greater challenge facing the state or nation. Why shouldn’t California take this “giant stride for mankind?” If not us – who? If not now – when?

In recent months a few in our midst have raised the haunting spectre of panic and depression. It is time we inoculated ourselves against the contagion of fear they would spread

The national government has embarked on a campaign to slow an inflation which has threatened our economy. There has been an understandable cooling off in the marketplace and a loss of earnings and employment. I do not minimize the anguish of the man of woman whose vocation or career has been interrupted. Everything possible must be done to alleviate their distress and shorten the period of economic dislocation.

But let us measure our strength. Let those who would play upon our fears ‘til we develop “an over the hill to the poorhouse” psychosis look at this way of life we call California as it really is.

If this state were a nation, it would rank among the top half-dozen economic giants of the world.

Our gross product will top one hundred billion dollars this year. We will earn more and spend more than any people anywhere in the world.

Eighty-four percent of us live in cities of more than 25,000. Yet we lead then nation in agricultural wealth.

We are young, with a median age of 30 – just inside that no-man’s land between the generations.

Our educational level is higher. We have a higher percentage of professionals and skilled technicians, and more than double our share of scholars and scientists.

In the decade which we embark upon today, the average family income will go from a little over $13,000 to more than $18,000 per year.

If all 20 million of us wanted to live elsewhere, we would find 100 people willing to trade places with each one of us.

Those who whine of a sick society aren’t talking about us. Our young people seek a cause in which they can invest their idealism, their youth and their strength. And we have such a cause. But we must prove to them our own faith and belief, that ours is the most innovative state in the union; that we have a history of accepting change – indeed of making change happen.

For, as Mark Twain once said: “The easy and slothful didn’t come to California. They stayed home.”

It is time to ignore those who are obsessed with what is wrong. Concentrate our attention on what is right – on how great is our power and potential, and how little we have to fear.

As I told a group of your fellow citizens who visited this capitol last fall, if California’s problems and California’s people were put in a ring together, it would have to be declared a mis-match.

We owe our humble thanks to a God who has blessed us possibly more than we deserve. Let us, in our stewardship of all He has given us, at least try to match His bounty – try as men to match his mountains.