U.S. Department of State
Other State Department Archive SitesU.S. Department of State
U.S. Department of State
U.S. Department of State
U.S. Department of State
U.S. Department of State
The State Department web site below is a permanent electronic archive of information released online from January 1, 1997 to January 20, 2001. Please see www.state.gov for current material from the Department of State. Or visit http://2001-2009.state.gov for information from that period. Archive sites are not updated, so external links may no longer function. Contact us with any questions about finding information. NOTE: External links to other Internet sites should not be construed as an endorsement of the views contained therein.
U.S. Department of State

                            THE WHITE HOUSE
                     Office of the Press Secretary
                      (San Francisco, California)
_______________________________________________________________________
For Immediate Release                                 February 26, 1999

                              REMARKS BY
                          PRESIDENT CLINTON
                          ON FOREIGN POLICY

                          Grand Hyatt Hotel
                       San Francisco, California
                           February 26, 1999

11:20 A.M. PST

THE PRESIDENT:  Thank you and good morning.  Mr. Mayor, we're delighted 
to be here in San Francisco.  We thank you for coming out to welcome 
us.  Senator Boxer, Representative Pelosi, Representative Lofgren, 
members of the California legislature who are here.  I'd like to 
especially thank two people who had a lot to do with the good things 
that have happened in the last six years in our administration, our 
former Secretary of Defense Bill Perry, and Mrs. Perry, are here; and 
General John Shalikashvili, thank you for coming.  We're delighted to 
see you.  (Applause.)

I very much appreciate this opportunity to speak with all of you, to be 
joined with Secretary Albright and Mr. Berger, to talk about America's 
role in that century to come; to talk about what we must do to realize 
the promise of this extraordinary moment in the history of the world.  
For the first time since before the rise of fascism early in this 
century, there is no overriding threat to our survival or our freedom.  
Perhaps for the first time in history, the world's leading nations are 
not engaged in a struggle with each other for security or territory.  
The world clearly is coming together.  

Since 1945, global trade has grown 15-fold, raising living standards on 
every continent.  Freedom is expanding; for the first time in history, 
more than half the world's people elect their own leaders.  Access to 
information by ordinary people the world over is literally exploding.

Because of these developments, and the dramatic increase in our own 
prosperity and confidence in this, the longest peacetime economic 
expansion in our history, the United States has the opportunity and, I 
would argue, the solemn 

responsibility to shape a more peaceful, prosperous, democratic world 
in the 21st century.

We must, however, begin this discussion with a little history and a 
little humility.  Listen to this quote by another American leader, at 
the dawn of a new century:  "The world's products are exchanged as 
never before, and with increasing transportation comes increasing 
knowledge and larger trade.  We travel greater distances in a shorter 
space of time, and with more ease, than was ever dreamed of.  The same 
important news is read, though in different languages, the same day, in 
all the world.  Isolation is no longer possible.  No nation can longer 
be indifferent to any other."

That was said by President William McKinley a hundred years ago.  What 
we now call globalization was well underway even then.  We, in fact, 
had more diplomatic posts in the world than we have today, and foreign 
investment actually played a larger role in our own economy then than 
it does today.

The optimism being expressed about the 20th century by President 
McKinley and others at that time was not all that much different from 
the hopes commonly expressed today about the 21st.  The rising global 
trade and communications did lift countless lives then, just as it does 
today.  But it did not stop the world's wealthiest nations from waging 
World War I and World War II.  It did not stop the Depression, or the 
Holocaust, or communism.  Had leading nations acted decisively then, 
perhaps these disasters might have been prevented.  But the League of 
Nations failed, and America -- well, our principal involvement in the 
world was commercial and cultural, unless and until we were attacked.

After World War II, our leaders took a different course.  Harry Truman 
came to this city and said that to change the world away from a world 
in which might makes right, "words are not enough.  We must once and 
for all prove by our acts conclusively that right has might."  He and 
his allies and their successors built a network of security alliances 
to preserve the peace, and a global financial system to preserve 
prosperity.  

Over the last six years, we have been striving to renew those 
arrangements and to create new ones for the challenges of the next 50 
years.  We have made progress, but there is so very much more to do.  
We cannot assume today that globalization alone will wash away the 
forces of destruction at the dawn of the 21st century, any more than it 
did at the dawn of the 20th century.  We cannot assume it will bring 
freedom and prosperity to ordinary citizens around the world who long 
for them.  We cannot assume it will assume it will avoid environmental 
and public health disasters.  We cannot assume that because we are now 
secure, we Americans do not need military strength or alliances, or 
that because we are prosperous, we are not vulnerable to financial 
turmoil half a world away.

The world we want to leave our children and grandchildren requires us 
to make the right choices, and some of them will be difficult.  America 
has always risen to great causes, yet we have a tendency, still, to 
believe that we can go back to minding our own business when we're 
done.  Today we must embrace the inexorable logic of globalization -- 
that everything, from the strength of our economy to the safety of our 
cities, to the health of our people, depends on events not only within 
our borders, but half a world away.  We must see the opportunities and 
the dangers of the interdependent world in which we are clearly fated 
to live.

There is still the potential for major regional wars that would 
threaten our security.  The arms race between India and Pakistan 
reminds us that the next big war could still be nuclear.  There is a 
risk that our former adversaries will not succeed in their transitions 
to freedom and free markets.  There is a danger that deadly weapons 
will fall into the hands of a terrorist group or an outlaw nation, and 
that those weapons could be chemical or biological.

There is a danger of deadly alliances among terrorists, narco-
traffickers, and organized criminal groups.  There is a danger of 
global environmental crises and the spread of deadly diseases.  There 
is a danger that global financial turmoil will undermine open markets, 
overwhelm open societies, and undercut our own prosperity.  

We must avoid both the temptation to minimize these dangers, and the 
illusion that the proper response to them is to batten down the hatches 
and protect America against the world.  The promise of our future lies 
in the world.  Therefore, we must work hard with the world -- to defeat 
the dangers we face together and to build this hopeful moment together, 
into a generation of peace, prosperity, and freedom.  Because of our 
unique position, America must lead with confidence in our strengths and 
with a clear vision of what we seek to avoid and what we seek to 
advance.

Our first challenge is to build a more peaceful 21st century world.  To 
that end, we're renewing alliances that extend the area where wars do 
not happen, and working to stop the conflicts that are claiming lives 
and threatening our interests right now.  

The century's bloodiest wars began in Europe.  That's why I've worked 
hard to build a Europe that finally is undivided, democratic and at 
peace.  We want all of Europe to have what America helped build in 
Western Europe -- a community that upholds common standards of human 
rights, where people have the confidence and security to invest in the 
future, where nations cooperate to make war unthinkable.

That is why I have pushed hard for NATO's enlargement and why we must 
keep NATO's doors open to new democratic members, so that other nations 
will have an incentive to deepen their democracies.  That is why we 
must forge a partnership between NATO and Russia, between NATO and 
Ukraine; why we are building a NATO capable not only of deterring 
aggression against its own territory, but of meeting challenges to our 
security beyond its territory -- the kind of NATO we must advance at 
the 50th Anniversary Summit in Washington this April.

We are building a stronger alliance with Japan, and renewing our 
commitment to deter aggression in Korea and intensifying our efforts 
for a genuine peace there.  I thank Secretary Perry for his efforts in 
that regard.  We also create a more peaceful world by building new 
partnerships in Asia, Africa, and Latin America.

Ten years ago we were shouting at each other across a North-South chasm 
defined by our differences.  Today, we are engaged in a new dialogue 
that speaks the language of common interests -- of trade and 
investment; of education and health; of democracies that deliver not 
corruption and despair, but progress and hope; of a common desire that 
children in all our countries will be free of the scourge of drugs.  
Through these efforts to strengthen old alliances and build new 
partnerships, we advance the prospects for peace.  However, the work of 
actually making peace is harder and often far more contentious.  

It's easy, for example, to say that we really have no interests in who 
lives in this or that valley in Bosnia, or who owns a strip of 
brushland in the Horn of Africa, or some piece of parched earth by the 
Jordan River.  But the true measure of our interests lies not in how 
small or distant these places are, or in whether we have trouble 
pronouncing their names.  The question we must ask is, what are the 
consequences to our security of letting conflicts fester and spread.  
We cannot, indeed, we should not, do everything or be everywhere.  But 
where are values and our interests are at stake, and where we can make 
a difference, we must be prepared to do so.  And we must remember that 
the real challenge of foreign policy is to deal with problems before 
they harm our national interests.

It's also easy to say that peacemaking is simply doomed, where people 
are embittered by generations of hate, where the old animosities of 
race and religion and ethnic difference raise their hoary heads.  But I 
will never forget the day that the leaders of Israel and the 
Palestinian Authority came to the White House, in September of 1993, to 
sign their peace accord.  At that moment, the question arose, and 
indeed, based on the pictures afterward, it seemed to be the main 
question, whether if, in front of the entire world, Prime Minister 
Rabin and Chairman Arafat would actually shake hands for the first 
time.  

It was an interesting and occasionally humorous discussion.  But it 
ended when Yitzhak Rabin, a soldier for a lifetime, said to me, "Mr. 
President, I have been fighting this man for a lifetime, 30 years.  I 
have buried a lot of my own people in the process.  But you do not make 
peace with your friends."

It is in our interest to be a peacemaker, not because we think we can 
make all these differences go away, but because, in over 200 years of 
hard effort here at home, and with bitter and good experiences around 
the world, we have learned that the world works better when differences 
are resolved by the force of argument rather than the force of arms.

That is why I am proud of the work we have done to support peace in 
Northern Ireland, and why we will keep pressing the leaders there to 
observe not just the letter, but the spirit of the Good Friday Accord.  
(Applause.)

It is also why I intend to use the time I have remaining in this office 
to push for a comprehensive peace in the Middle East, to encourage 
Israelis and Palestinians to reach a just and final settlement, and to 
stand by our friends for peace, such as Jordan.  The people of the 
Middle East can do it, but time is precious, and they can't afford to 
waste any more of it.  In their hearts, they know there can be no 
security or justice for any who live in that small and sacred land 
until there is security and justice for all who live there.  If they do 
their part, we must do ours.

We will also keep working with our allies to build peace in the 
Balkans.  Three years ago, we helped to end the war in Bosnia.  A lot 
of doubters then thought it would soon start again.  But Bosnia is on a 
steady path toward renewal and democracy.  We've been able to reduce 
our troops there by 75 percent as peace has taken hold, and we will 
continue to bring them home.

The biggest remaining danger to this progress has been the fighting and 
the repression in Kosovo.  Kosovo is, after all, where the violence in 
the former Yugoslavia began, over a decade ago, when they lost the 
autonomy guaranteed under Yugoslav law.  We have a clear national 
interest in ensuring that Kosovo is where this trouble ends.  If it 
continues, it almost certainly will draw in Albania and Macedonia, 
which share borders with Kosovo, and on which clashes have already 
occurred.

Potentially, it could affect our allies, Greece and Turkey.  It could 
spark tensions in Bosnia itself, jeopardizing the gains made there.  If 
the conflict continues, there will certainly be more atrocities, more 
refugees, more victims crying out for justice and seeking out revenge.

Last fall, a quarter of a million displaced people in Bosnia were 
facing cold and hunger in the hills.  Using diplomacy backed by force, 
we brought them home and slowed the fighting. 

For 17 days this month, outside Paris, we sought with our European 
partners an agreement that would end the fighting for good.  Progress 
was made toward a common understanding of Kosovo's autonomy -- progress 
that would not have happened, I want to say, but for the unity of our 
allies and the tireless leadership of our Secretary of State Madeleine 
Albright.  (Applause.)

Here's where we are.  Kosovar Albanian leaders have agreed in principle 
to a plan that would protect the rights of their people and give them 
substantial self-government.  Serbia has agreed to much, but not all, 
of the conditions of autonomy, and has so far not agreed to the 
necessity of a NATO-led international force to maintain the peace 
there.  

Serbia's leaders must now accept that only by allowing people in Kosovo 
control over their day-to-day lives -- as, after all, they have been 
promised under Yugoslav law -- it is only by doing that can they keep 
their country intact.

Both sides must return to the negotiations on March 15, with clear 
mandate for peace.  In the meantime, President Milosevic should 
understand that this is a time for restraint, not repression.  And if 
he does not, NATO is prepared to act.

Now, if there is a peace agreement that is effective, NATO must also be 
ready to deploy to Kosovo to give both sides the confidence to lay down 
their arms.  Europeans would provide the great bulk of such a force, 
roughly 85 percent.  But if there is a real peace, America must do its 
part as well.  

Kosovo is not an easy problem.  But if we don't stop the conflict now, 
it clearly will spread.  And then we will not be able to stop it, 
except at far greater cost and risk.

A second challenge we face is to bring our former adversaries, Russia 
and China, into the international system as open, prosperous, stable 
nations.  The way both countries develop in the coming century will 
have a lot to do with the future of our planet.  

For 50 years, we confronted the challenge of Russia's strength.  Today, 
we must confront the risk of a Russia weakened by the legacy of 
communism and also by its inability at the moment to maintain 
prosperity at home or control the flow of its money, weapons and 
technology across its borders.  

The dimensions of this problem are truly enormous.  Eight years after 
the Soviet collapse, the Russian people are hurting.  The economy is 
shrinking, making the future uncertain.  Yet, we have as much of a 
stake today in Russia overcoming these challenges as we did in checking 
its expansion during the Cold War.  This is not a time for complacency 
or self-fulfilling pessimism.  Let's not forget that Russia's people 
have overcome enormous obstacles before.  And just this decade, with no 
living memory of democracy or freedom to guide them, they have built a 
country more open to the world than ever; a country with a free press 
and a robust, even raucous debate; a country that should see in the 
first year of the new millennium the first peaceful democratic transfer 
of power in its 1,000-year history.  

The Russian people will decide their own future.  But we must work with 
them for the best possible outcome, with realism and with patience.  If 
Russia does what it must to make its economy work, I am ready to do 
everything I can to mobilize adequate international support for them.  
With the right framework, we will also encourage foreign investment in 
its factories, its energy fields, its people.  We will increase our 
support for small business and for the independent media.  We will work 
to continue cutting our two nations' nuclear arsenals, and help Russia 
prevent both its weapons and its expertise from falling into the wrong 
hands. 

The budget I have presented to Congress will increase funding for this 
critical threat reduction by 70 percent over the next five years.  

The question China faces is how best to assure its stability and 
progress.  Will it choose openness and engagement?  Or will it choose 
to limit the aspirations of its people without fully embracing the 
global rules of the road?  In my judgment, only the first path can 
really answer the challenges China faces. 

We cannot minimize them.  China has made incredible progress in lifting 
people out of poverty, and building a new economy.  But now its rate of 
economic growth is declining -- just as it is needed to create jobs for 
a growing, and increasingly more mobile, population.  Most of China's 
economy is still stifled by state control.  We can see in China the 
kinds of problems a society faces when it is moving away from the rule 
of fear, but is not yet rooted in the rule of law.

China's leaders know more economic reform is needed, and they know 
reform will cause more unemployment, and they know that can cause 
unrest.  At the same time, and perhaps for those reasons, they remain 
unwilling to open up their political system, to give people a peaceful 
outlet for dissent.

Now, we Americans know that dissent is not always comfortable, not 
always easy, and often raucous.  But I believe that the fact that we 
have peaceful, orderly outlets for dissentis one of the principal 
reasons we're still around here as the longest-lasting freely elected 
government in the world.  And I believe, sooner or later, China will 
have to come to understand that a society, in the world we're living in 
-- particularly a country as great and old and rich and full of 
potential as China -- simply cannot purchase stability at the expense 
of freedom.

On the other hand, we have to ask ourselves, what is the best thing to 
do to try to maximize the chance that China will take the right course, 
and that, because of that, the world will be freer, more peaceful, more 
prosperous in the 21st century?  I do not believe we can hope to bring 
change to China if we isolate China from the forces of change.  Of 
course, we have our differences, and we must press them.  But we can do 
that, and expand our cooperation, through principled and purposeful 
engagement with China, its government, and its people.

Our third great challenge is to build a future in which our people are 
safe from the dangers that arise, perhaps halfway around the world -- 
dangers from proliferation, from terrorism, from drugs, from the 
multiple catastrophes that could arise from climate change.

Each generation faces the challenges of not trying to fight the last 
war.  In our case, that means recognizing that the more likely future 
threat to our existence is not a strategic nuclear strike from Russia 
or China, but the use of weapons of mass destruction by an outlaw 
nation or a terrorist group.

In the last six years, fighting that threat has become a central 
priority of American foreign policy.  Here, too, there is much more to 
be done.  We are working to stop weapons from spreading at the source, 
as with Russia.  We are working to keep Iraq in check so that it does 
not threaten the rest of the world or its region with weapons of mass 
destruction.  We are using all the means at our disposal to deny 
terrorists safe havens, weapons, and funds.  Even if it takes years, 
terrorists must know there is no place to hide.

Recently, we tracked down the gunman who killed two of our people 
outside the CIA six years ago.  We are training and equipping our local 
fire, police and medical personnel to deal with chemical, biological 
and nuclear emergencies, and improving our public health surveillance 
system, so that if a biological weapon is released, we can detect it 
and save lives.  We are working to protect our critical computer 
systems from sabotage.

Many of these subjects are new and unfamiliar, and may be frightening.  
As I said when I gave an address in Washington not very long ago about 
what we were doing on biological and computer security and criminal 
threats, it is important that we have the right attitude about this.  
It is important that we understand that the risks are real and they 
require, therefore, neither denial, nor panic.  As long as people 
organize themselves in human societies, there will be organized forces 
of destruction who seek to take advantage of new means of destroying 
other people.  

And the whole history of conflict can be seen in part as the race of 
defensive measures to catch up with offensive capabilities.  That is 
what we're doing in dealing with the computer challenges today; that is 
what we are doing in dealing with the biological challenges today.  It 
is very important that the American people, without panic, be serious 
and deliberate about them, because it is the kind of challenge that we 
have faced repeatedly.  And as long as our country and the world is 
around, unless there is some completely unforeseen change in human 
nature, our successors will have to do the same.

We are working to develop a national missile defense system which 
could, if we decide to deploy it, be deployed against emerging 
ballistic missile threats from rogue nations.  We are bolstering the 
global agreements that curb proliferation.  That's the most important 
thing we can be doing right now.  This year, we hope to achieve an 
accord to strengthen compliance with the Convention against Biological 
Weapons.  It's a perfectly good convention, but, frankly, it has no 
teeth.  We have to give it some.  And we will ask our Senate to ratify 
the Comprehensive Test Ban Treaty to stop nations from testing nuclear 
weapons so they're constrained from developing new ones.

Again, I say:  I implore the United States Senate to ratify the 
Comprehensive Test Ban Treaty this year.  It is very important for the 
United States and the world.  (Applause.)  

Our security and our safety also depends upon doing more to protect our 
people from the scourge of drugs.  To win this fight, we must work with 
others, including and especially Mexico.  Mexico has a serious drug 
problem, increasingly affecting more of its own young people.  No one 
understands this better than President Zedillo.  He described it as the 
number one threat to his country's security, its people its democracy.  
He is working hard to establish clean government, true democracy and 
the rule of law.  He is working hard to tackle the corruption 
traffickers have wrought.  

He cannot win this battle alone, and neither can we.  In any given 
year, the narco-traffickers may spend hundreds of millions of dollars 
to try to suborn Mexican law enforcement officials, most of whom work 
for under $10,000 a year.

As I certified to Congress today, Mexico is cooperating with us in the 
battle for our lives.  And I believe the American people will be safer 
in this, as in so many other ways, if we fight drugs with Mexico, 
rather than walk away.  

Another global danger we face is climate change.  As far as we can 
tell, with all the scientific evidence available, the hottest years our 
planet has ever experienced were 1997 and 1998.  The two hottest years 
recorded in the last several -- excuse me -- nine of the ten hottest 
years recorded in the last several centuries occurred in the last 
decade.

Now, we can wait and hope and do nothing, and try to ignore what the 
vast majority of scientists tell us is a pattern that is fixed and 
continuing.  We could ignore the record-breaking temperatures, the 
floods, the storms, the droughts that have caused such misery.  Or we 
can accept that preventing the disease and destruction climate change 
can bring will be infinitely cheaper than letting future generations 
try to clean up the mess, especially when you consider that greenhouse 
gases, once emitted into the atmosphere, last and have a destructive 
environmental effect for at least a hundred years.

We took a giant step forward in 1997, when we helped to forge the Kyoto 
agreement.  Now we're working to persuade developing countries that 
they, too, can and must participate meaningfully in this effort without 
forgoing growth.  We are also trying to persuade a majority in the 
United States Congress that we can do the same thing.

The approach I have taken in America is not to rely on a whole raft of 
new regulations, and not to propose big energy taxes, but instead to 
offer tax incentives and dramatic increases in investment in new 
technologies, because we know -- we know now -- that we have the 
technological capacity to break the iron link between Industrial Age 
energy use patterns and economic growth.  You're proving it in 
California every day, with stiffer environmental standards than other 
states have.

We know that the technology is just beginning to emerge to allow us to 
have clean cars and other clean forms of transportation; to 
dramatically increase the capacity of all of our buildings to keep out 
heat and cold, and to let in more light.  We know that the conservation 
potential of what we have right now available has only just been 
scratched.  And we must convince the world, and critical decision-
makers in the United States to change their minds about a big idea -- 
namely, that the only way a country can grow is to consume more energy 
resources in a way that does more to increase global warning.

One of the most interesting conversations I had when I was in China was 
with the Environmental Minister there, who thanked me for going there 
to do an environmental event, because he was having trouble convincing 
the government that they could continue to lift the Chinese people out 
of poverty and still improve the environment.  This is a central, big 
idea that people all over the world will have to change their minds 
about before we will be open and free to embrace the technological 
advances that are lying evident all around us.  And all of you that can 
have any impact on that, I implore you to do it.  (Applause.)

Our fourth challenge is to create a world trading and financial system 
that will lift the lives of ordinary people on every continent around 
the world.  Or, as it has been stated in other places, to put a human 
face on the global economy.  Over the last six years, we've taken giant 
steps in opening the global trading system.  The United States alone 
has concluded over 270 different trade agreements.  Once again, we are 
the world's largest exporting nation.  There is a lot more to be done. 

In the first five years of my presidency, about 30 percent of our 
growth came from expanding trade.  Last year, we had a good year, but 
we didn't have much growth from expanding trade because of the terrible 
difficulties of the people in Asia, in Russia, and because of the 
slowdown in growth in Latin America, and because we did not reach out 
to seize new possibilities in Africa.  Those people are suffering more, 
and our future prospects are being constrained. 

The question is what to do about it.  Some of the folks outside who 
were protesting when I drove up were saying by their signs that they 
believe globalization is inherently bad and there's no way in the wide 
world to put a human face on the global economy.  But if you look at 
the facts of the last 30 years, hundreds of millions of people have had 
their economic prospects advanced on every continent because they have 
finally been able to find a way to express their creativity in positive 
terms, and produce goods and services that could be purchased around 
the borders of their nation.

Now, the question is, how do we deal with the evident challenges and 
problems that we face in high relief today, and seize the benefit that 
we know comes from expanding trade.  I've asked for a new round of 
global trade negotiations to expand exports of services, foreign 
products and manufacturers.  I am still determined to reach agreement 
on a free trade area of the Americas.  If it hadn't been for our 
expansion in Latin America, from Mexico all the way to the southern tip 
of South America, we would have been in much worse shape this last 
year.  

I have urged Congress to give the trade authority the President has 
traditionally had to advance our prosperity, and I've asked them to 
approve the Caribbean Basin Initiative and the Africa Growth and 
Opportunity Act because we have special responsibilities and special 
opportunities in the Caribbean and in Africa that have gone too long 
unseized.

But trade is not an end in itself.  It has to work for ordinary people; 
it has to contribute to the wealth and fairness of societies.  It has 
to reinforce the values that give meaning to life, not simply in the 
United States, but in the poorest countries, struggling to lift their 
people to their dreams.  That's why we're working to build a trading 
system that upholds the rights of workers and consumers, and helps us 
and them in other countries to protect the environment, so that 
competition among nations is a race to the top, not the bottom.  This 
year we will lead the international community to conclude a treaty to 
ban abusive child labor everywhere in the world.  (Applause.)

The gains of global economic exchange have been real and dramatic.  But 
when the tides of capital first flood emerging markets, and then 
abruptly recede; when bank failures and bankruptcies grip entire 
economies; when millions who have worked their way into the middle 
class are plunged suddenly into poverty -- the need for reform of the 
international financial system is clear.

I don't want to minimize the complexity of this challenge.  As nations 
began to trade more, and as investment rules began to permit people to 
invest in countries other than their own more, it became more and more 
necessary to facilitate the conversion of currencies.  Whenever you do 
that, you will create a market against risk, just in the transfer of 
currencies.  Whenever you do that, you will have people that are moving 
money around because they think the value of the money itself will 
change, and profit might be gained in an independent market of currency 
exchange.

It is now true that on any given day, there is $1.5 trillion of 
currency exchange in the world.  Many, many, many times more than the 
actual value of the exchange of goods and services.  And we have got to 
find a way to facilitate the movement of money -- without which trade 
and investment cannot occur -- in a way that avoids these dramatic 
cycles of boom and then bust, which have led to the collapse of 
economic activity in so many countries around the world.  

We found a way to do it in the United States after the Great 
Depression.  And thank goodness we have never again had a Great 
Depression, even though we've had good times and bad times.  That is 
the challenge facing the world financial system today.

The leading economies have got a lot of work to do.  We have to do 
everything we can -- not just the United States, but Europe and Japan -
- to spur economic growth.  Unless there is a restoration of growth, 
all the changes in the financial rules we make will not get Asia, Latin 
America, countries -- Russia -- out of their difficulties.  

We have to be ready to provide quick and decisive help to nations 
committed to sound policies.  We have to help nations build social 
safety nets so that, when they have inevitable changes in their 
economic conditions, people at least have the basic security they need 
to continue to embrace change and advance the overall welfare of 
society.

We have to encourage nations to maintain open, properly regulated 
financial systems so that decisions are shaped by informed market 
decisions and not distorted by corruption.  We also have to take 
responsible steps to reform the global financial architecture for the 
21st century.  And we'll do some more of that at the G-7 summit in 
Germany in June.  

In the meanwhile, we have to recognize that the United States has made 
a great contribution to keeping this crisis from being worse than it 
would have been by helping to get money to Brazil, to Russia, to other 
countries, and by keeping our own markets open.  If you compare, for 
example, our import patterns with those of Europe or those of Japan, 
you will see that we have far, far more open markets.  It has worked to 
make us competitive and productive.  We also have the lowest 
unemployment rate in the entire world among all advanced countries now, 
something that many people thought would never happen again.

On the other hand, we cannot let other countries' difficulties in our 
open markets become an excuse for them to violate international trade 
rules and dump products illegally on our markets.  We've had enough 
problems in America this year and last year -- in agriculture and 
aerospace, especially -- from countries that could no longer afford to 
buy products, many of which they had already offered.  Then, in the 
last several months, we've seen an enormous problem in this country in 
our steel industry because of evident dumping of products in the 
American market that violated the law.

So I want you to know what while I will do everything to keep our 
markets open, I intend while this crisis persists to do everything I 
can to enforce our trade laws.  

Yesterday, we received some evidence that our aggressive policy is 
producing some results, and I think proof that it wasn't market forces 
that led to what we saw in steel over the last year.  The new figures 
from the Commerce Department show this:  Imports of hot-rolled steel 
from countries most responsible for the surge -- Japan, Russia and 
Brazil -- have fallen by 96 percent from the record levels we saw last 
November.

That is not bad news for them, that's good news.  If American markets 
are going to stay open, we have to play by the rules.  We have to 
follow lawful economic trends, not political and economic decisions 
made to dump on the American markets in ways which hurt our economy and 
undermine our ability to buy the exports of other countries.

Our fifth challenge has to keep freedom as a top goal for the world of 
the 21st century.  Countries like South Korea and Thailand have proven 
in this financial crisis that open societies are more resilient, that 
elected governments have a legitimacy to make hard choices in hard 
times.  But if democracies over the long run aren't able to deliver for 
their people, to take them out of economic turmoil, the pendulum that 
swung so decisively toward freedom over the last few years could swing 
back, and the next century could begin as badly as this one began in 
that regard.

Therefore, beyond economics, beyond the transformation of the great 
countries to economic security -- Russia and China-- beyond many of our 
security concerns, we also have to recognize that we can have no 
greater purpose than to support the right of other people to live in 
freedom and shape their own destiny.  If that right could be 
universally exercised, virtually every goal I have outlined today would 
be advanced.

We have to keep standing by those who risk their own freedom to win it 
for others.  Today we're releasing our annual Human Rights Report:  The 
message of the Human Rights Report is often resented, but always 
respected, for its candor, its consistency for what it says about our 
country and our values.  We need to deepen democracy where it's already 
taking root by helping our partners narrow their income gaps, 
strengthen their legal institutions, and build well-educated, healthy 
societies.  

This will be an important part of the trip I take to Central America 
next week, which has prevailed against decades of civil war only to be 
crushed in the last several months by the devastating force of nature.

This year, we will see profoundly important developments in the 
potential transition to democracy in two critical countries -- 
Indonesia and Nigeria.  Both have the capacity to lift their entire 
regions if they succeed, and to swamp them in a sea of disorder if they 
fail.  In the coming year and beyond, we must make a concentrated 
effort to help them achieve what will be the world's biggest victories 
for freedom since 1989.  

Nigeria is the most populous country in Africa.  Tomorrow, it holds its 
first free presidential election, after a dictatorship that made it the 
poorest oil-rich country in the world.  We are providing support for 
the transition, and if it succeeds we have to be prepared to do more.  
Because we count on further progress, today we are also waiving the 
sanctions we imposed when its government did not cooperate in the fight 
against drugs.  

Indonesia is the fourth-largest nation and the largest Islamic country 
in the entire world.  In June, it will hold what we hope will be its 
first truly democratic election in more than 40 years.  Indonesia 
desperately needs a government that can help it overcome its economic 
crisis while maintaining the support of its people.  We are helping to 
strengthen the social safety net for its people in providing the 
largest contribution of any nation to support the coming elections.

Whether these struggles are far or near, their outcome will profoundly 
affect us.  Whether a child in Africa or Southeast Asia or Russia or 
China can grow up educated, healthy, safe, free from violence, free of 
hate, full of hope, and free to decide his or her own destiny, this 
will have a lot to do with the life our children have as they grow up.  
It will help to determine if our children go to war, have jobs, have 
clean air, have safe streets.

For our nation to be strong, we must maintain a consensus that 
seemingly distant problems can come home if they are not addressed, and 
addressed promptly.  We must recognize we cannot lift ourselves to the 
heights to which we aspire if the world is not rising with us.  I say 
again, the inexorable logic of globalization is the genuine recognition 
of interdependence.  We cannot wish into being the world we seek.  Talk 
is cheap; decisions are not.

That is why I have asked Congress to reverse the decline in defense 
spending that began in 1985, and I am hopeful and confident that we can 
get bipartisan majorities in both Houses to agree.  I hope it will also 
agree to give more support to our diplomats, and to programs that keep 
our soldiers out of war; to fund assistance programs to keep nations on 
a stable path to democracy and growth; and to finally pay both our dues 
and our debts to the United Nations.  (Applause.)  

In an interdependent world, we cannot lead if we expect to lead only on 
our own terms, and never on our own nickel.  We can't be a first-class 
power if we're only prepared to pay for steerage.

I hope all of you, as citizens, believe that we have to seize the 
responsibilities that we have today with confidence -- to keep taking 
risks for peace; to keep forging opportunities for our people, and 
seeking them for others as well; to seek to put a genuinely human face 
on the global economy; to keep faith with all those around the world 
who struggle for human rights, the rule of law, a better life; to look 
on our leadership not as a burden, but as a welcome opportunity; to 
build the future we dream for our children in these, the final days of 
the 20th century, and the coming dawn of the next.

The story of the 21st century can be quite a wonderful story.  But we 
have to write the first chapter.

Thank you very much.  (Applause.)

END: 12:10 P.M. PST