The American economy is pre-eminent -- but we cannot afford to be complacent. In a dynamic world economy, we are seeing new competitors like China and India. This creates uncertainty, which makes it easier to feed people's fears. And so we are seeing some old temptations return. Protectionists want to escape competition, pretending that we can keep our high standard of living while walling off our economy. Others say that the government needs to take a larger role in directing the economy, centralizing more power in Washington and increasing taxes. We hear claims that immigrants are somehow bad for the economy -- even though this economy could not function without them. All these are forms of economic retreat, and they lead in the same direction -- toward a stagnant and second-rate economy.
Tonight I will set out a better path -- an agenda for a Nation that competes with confidence -- an agenda that will raise standards of living and generate new jobs. Americans should not fear our economic future, because we intend to shape it.
Keeping America competitive begins with keeping our economy growing. And our economy grows when Americans have more of their own money to spend, save, and invest. In the last five years, the tax relief you passed has left 880 billion dollars in the hands of American workers, investors, small businesses, and families -- and they have used it to help produce more than four years of uninterrupted economic growth. Yet the tax relief is set to expire in the next few years. If we do nothing, American families will face a massive tax increase they do not expect and will not welcome.
Because America needs more than a temporary expansion, we need more than temporary tax relief. I urge the Congress to act responsibly, and make the tax cuts permanent.
Keeping America competitive requires us to be good stewards of tax dollars. Every year of my presidency, we have reduced the growth of non-security discretionary spending -- and last year you passed bills that cut this spending. This year my budget will cut it again, and reduce or eliminate more than 140 programs that are performing poorly or not fulfilling essential priorities. By passing these reforms, we will save the American taxpayer another 14 billion dollars next year -- and stay on track to cut the deficit in half by 2009. I am pleased that Members of Congress are working on earmark reform -- because the Federal budget has too many special interest projects. And we can tackle this problem together, if you pass the line-item veto.
We must also confront the larger challenge of mandatory spending, or entitlements. This year, the first of about 78 million Baby Boomers turn 60, including two of my Dad's favorite people -- me, and President Bill Clinton. This milestone is more than a personal crisis -- it is a national challenge. The retirement of the Baby Boom generation will put unprecedented strains on the Federal government. By 2030, spending for Social Security, Medicare, and Medicaid alone will be almost 60 percent of the entire Federal budget. And that will present future Congresses with impossible choices -- staggering tax increases, immense deficits, or deep cuts in every category of spending.
Congress did not act last year on my proposal to save Social Security, yet the rising cost of entitlements is a problem that is not going away -- and with every year we fail to act, the situation gets worse. So tonight, I ask you to join me in creating a commission to examine the full impact of Baby Boom retirements on Social Security, Medicare, and Medicaid. This commission should include Members of Congress of both parties, and offer bipartisan answers. We need to put aside partisan politics, work together, and get this problem solved.
Keeping America competitive requires us to open more markets for all that Americans make and grow. One out of every five factory jobs in America is related to global trade, and we want people everywhere to buy American. With open markets and a level playing field, no one can out-produce or out-compete the American worker.
Keeping America competitive requires an immigration system that upholds our laws, reflects our values, and serves the interests of our economy. Our Nation needs orderly and secure borders. To meet this goal, we must have stronger immigration enforcement and border protection. And we must have a rational, humane guest worker program that rejects amnesty ... allows temporary jobs for people who seek them legally ... and reduces smuggling and crime at the border.
Keeping America competitive requires affordable health care. Our government has a responsibility to help provide health care for the poor and the elderly, and we are meeting that responsibility. For all Americans, we must confront the rising cost of care ... strengthen the doctor-patient relationship ... and help people afford the insurance coverage they need. We will make wider use of electronic records and other health information technology, to help control costs and reduce dangerous medical errors. We will strengthen Health Savings Accounts -- by making sure individuals and small business employees can buy insurance with the same advantages that people working for big businesses now get. We will do more to make this coverage portable, so workers can switch jobs without having to worry about losing their health insurance. And because lawsuits are driving many good doctors out of practice -- leaving women in nearly 1,500 American counties without a single OB-GYN -- I ask the Congress to pass medical liability reform this year.