Mr. Speaker, Mr. Vice President, Members of Congress, honored guests, my fellow Americans:

Tonight, I have the honor of reporting on the State of the Union.

Let me begin by saluting the new Speaker of the House, and thanking him for extending invitations to two special guests who are sitting in the gallery with Mrs. Hastert. Lyn Gibson and Wei Ling Chestnut are the widows of the two brave Capitol Police Officers who gave their lives to defend freedom’s house.

I stand before you to report that America has created the longest peacetime economic expansion in our history—with nearly 18 million new jobs, wages rising at more than twice the rate of inflation, the highest homeownership in history, the smallest welfare rolls in 30 years—and the lowest peacetime unemployment since 1957.

For the first time in three decades, the budget is balanced. From a deficit of $290 billion in 1992, we had a surplus of $70 billion last year. We are on course for budget surpluses for the next 25 years.

Violent crime is the lowest in a quarter century. Our environment is the cleanest in a quarter century.

America is a strong force for peace from Northern Ireland, to Bosnia, to the Middle East.

Thanks to the pioneering leadership of Vice President Gore, we have a government for the Information Age. Once again, our government is a progressive instrument of the common good, rooted in our oldest values: opportunity, responsibility, community. A modern government, devoted to fiscal responsibility and determined to give our people the tools they need to make the most of their own lives. A 21st Century government for 21st Century America.

My fellow Americans, I stand before you to report that the state of our union is strong.

America is working again. The promise of our future is limitless. But we cannot realize that promise if we allow the hum of our prosperity to lull us into complacency. How we fare as a nation far into the 21st Century depends upon what we do as a nation today.

So with our budget surplus growing, our economy expanding, our confidence rising, now is the moment for this generation to meet our historic responsibility to the 21st Century. Let’s get to work.

Our fiscal discipline gives us an unsurpassed opportunity to address a remarkable new challenge: the aging of America.

With the number of elderly Americans set to double by 2030, the Baby Boom will become a Senior Boom.

So first and above all, we must save Social Security for the 21st Century.

Early in this century, being old meant being poor. When President Roosevelt created Social Security, thousands wrote to thank him for eliminating what one woman called the "stark terror of penniless, helpless old age." Even today, without Social Security, half our nation’s elderly would be forced into poverty.

Today, Social Security is strong. But by 2013, payroll taxes will no longer be sufficient to cover monthly payments. And by 2032, the Trust Fund will be exhausted, and Social Security will be unable to pay out the full benefits older Americans have been promised.

The best way to keep Social Security a rock-solid guarantee is not to make drastic cuts in benefits; not to raise payroll tax rates; and not to drain resources from Social Security in the name of saving it.

Instead, I propose that we make the historic decision to invest the surplus to save Social Security.

Specifically, I propose that we commit sixty percent of the budget surplus for the next 15 years to Social Security, investing a small portion in the private sector just as any private or state government pension would do. This will earn a higher return and keep Social Security sound for 55 years.

But we must aim higher. We should put Social Security on a sound footing for the next 75 years. And we should reduce poverty among elderly women, who are nearly twice as likely to be poor as other seniors—and we should eliminate the limits on what seniors on Social Security can earn.

These changes will require difficult but fully achievable choices. They must be made on a bipartisan basis. They should be made this year. I reach out my hand to those of you of both parties in both houses and ask you to join me in saying: We will Save Social Security now.

Last year, we wisely reserved all of the surplus until we knew what it would take to save Social Security. Again, I say, we should not spend any of it until after Social Security is truly saved. First things first.

Second, once we have saved Social Security, we must fulfill our obligation to save and improve Medicare. Already, we have extended the life of Medicare by 10 years—but we should extend it for at least another decade. Tonight I propose that we use one out of every six dollars in the surplus over the next 15 years to guarantee the soundness of Medicare until the year 2020.

But again, we should aim higher. We must be willing to work in a bipartisan way and look at new ideas, including the upcoming report of the bipartisan Medicare commission. If we work together, we can secure Medicare for the next two decades and cover seniors’ greatest need—affordable prescription drugs.

Third, we must help all Americans, from their first day on the job, to save, to invest, to create wealth. From its beginning, Americans have supplemented Social Security with private pensions and savings. Yet today, millions of people retire with little to live on other than Social Security. Americans living longer than ever must save more than ever.

Therefore, in addition to saving Social Security and Medicare, I propose a new pension initiative for retirement security in the 21st Century. I propose that we use 11 percent of the surplus to establish Universal Savings Accounts—USA Accounts —to give all Americans the means to save. With these new accounts, Americans can invest as they choose, and receive funds to match a portion of their savings, with extra help for those least able to save.

USA Accounts will help all Americans to share in our nation’s wealth, and to enjoy a more secure retirement.

Fourth, we must invest in long-term care. I propose a tax credit of $1,000 for the aged, ailing or disabled and the families who care for them. Long-term care will become a bigger and bigger challenge with the aging of America—and we must help our families deal with it.

I was born in 1946, the first year of the Baby Boom. I can tell you: Our generation is determined not to let our growing old place an intolerable burden on our children and their ability to raise our grandchildren. Our economic success and fiscal discipline now give us the opportunity to lift that burden.

Saving Social Security and Medicare is the right way to use the surplus. If we do so, we will still have the resources to meet urgent national needs in education and defense. And this plan is fiscally sound. And listen to this: By saving the money we need to save Social Security and Medicare, then within fifteen years we will achieve the lowest level of publicly held debt since 1917.

With these four measures—saving Social Security, strengthening Medicare, establishing USA Accounts, and supporting long-term care—we can begin to meet our generation’s historic responsibility to establish true security for 21st Century seniors.