--major social problems were being ignored or poorly addressed by the Federal government;
--our defense posture was declining as a result of a defense budget which was continuously shrinking in real terms;
--the strength of the NATO Alliance needed to be bolstered;
--tensions between Israel and Egypt threatened another Middle East war; and
--America's resolve to oppose human rights violations was under serious question.
Over the past 48 months, clear progress has been made in solving the challenges we found in January of 1977:
--almost all of our comprehensive energy program have been enacted, and the Department of Energy has been established to administer the program; confidence in the government's integrity has been restored, and respect for the government's openness and fairness has been renewed;
--the government has been made more effective and efficient: the Civil Service system was completely reformed for the first time this century;
--14 reorganization initiatives have been proposed to the Congress, approved, and implemented;
--two new Cabinet departments have been created to consolidate and streamline the government's handling of energy and education problems;