But let us turn briefly to the international arena.  America’s leadership in the world came to us because of our own strength and because of the values which guide us as a society:  free elections, a free press, freedom of religious choice, free trade unions, and above all, freedom for the individual and rejection of the arbitrary power of the state.  These values are the bedrock of our strength.  They unite us in a stewardship of peace and freedom with our allies and friends in NATO, in Asia, in Latin America, and elsewhere.  They are also the values which in the recent past some among us had begun to doubt and view with a cynical eye.

Fortunately, we and our allies have rediscovered the strength of our common democratic values, and we’re applying them as a cornerstone of a comprehensive strategy for peace with freedom.  In London last year, I announced the commitment of the United States to developing the infrastructure of democracy throughout the world.  We intend to pursue this democratic initiative vigorously.  The future belongs not to governments and ideologies which oppress their peoples, but to democratic systems of self-government which encourage individual initiative and guarantee personal freedom.

But our strategy for peace with freedom must also be based on strength—­economic strength and military strength.  A strong American economy is essential to the well-being and security of our friends and allies.  The restoration of a strong, healthy American economy has been and remains one of the central pillars of our foreign policy.  The progress I’ve been able to report to you tonight will, I know, be as warmly welcomed by the rest of the world as it is by the American people.

We must also recognize that our own economic well-being is inextricably linked to the world economy.  We export over 20 percent of our industrial production, and 40 percent of our farmland produces for export.  We will continue to work closely with the industrialized democracies of Europe and Japan and with the International Monetary Fund to ensure it has adequate resources to help bring the world economy back to strong, noninflationary growth.

As the leader of the West and as a country that has become great and rich because of economic freedom, America must be an unrelenting advocate of free trade.  As some nations are tempted to turn to protectionism, our strategy cannot be to follow them, but to lead the way toward freer trade.  To this end, in May of this year America will host an economic summit meeting in Williamsburg, Virginia.

As we begin our third year, we have put in place a defense program that redeems the neglect of the past decade.  We have developed a realistic military strategy to deter threats to peace and to protect freedom if deterrence fails.  Our Armed Forces are finally properly paid; after years of neglect are well trained and becoming better equipped and supplied.  And the American uniform is once again worn with pride.  Most of the major systems needed for modernizing our defenses are already underway, and we will be addressing one key system, the MX missile, in consultation with the Congress in a few months.