June 6, 1987 I'm speaking to you from one of the most beautiful cities in the world, Venice, Italy, where I'll be meeting soon with the other leaders of the seven largest industrialized countries of the free world. It's time for our yearly summit conference on international economic issues. Now, all of this -- foreign leaders talking economics in the city of canals and gondolas -- may sound a bit distant from your daily concerns, but take it from me, the issues we'll be discussing next week directly affect your lives and your future. That's because continued economic expansion and growth throughout the world is crucial to our prosperity at home.
When I attended my first summit back in Ottawa in 1981, the global economy was in grave danger. We had inflation running at 10 percent in industrialized countries, not to mention high interest rates, excessive tax burdens, and too much government everywhere. Worse than all of this, there was no clear consensus among world leaders about how to set ourselves back on the road to recovery. In the 6 years since that conference, the United States has made tremendous progress. With the American economy leading the way, we showed what can be achieved with economic policies based on less government and more personal freedom. As we reduced the taxes, cut inflation, and brought down interest rates, we demonstrated that economic growth can be vigorous and sustained. So, too, the world leaders in Venice next week can look back on a solid record of accomplishment. Today inflation remains low, while interest rates are moderate, and prospects are favorable for growth to continue for a fifth year. So, you see, we did find that consensus for economic renewal and growth, a consensus that relied not on government but the dynamism of free peoples.
But there are challenges ahead, and what we do next week to meet those challenges will have a direct impact on all Americans. Those of you who listen to these broadcasts will know, for example, how often I've stressed the threat that high tariffs and other trade barriers pose to economic progress. Some of us who lived through the hard times of the 1930's can tell you about that danger. When one nation decides to erect these barriers, it leads inevitably to retaliation by other nations. Soon the trade war is underway. Markets shrink all over the world, and the result is economic slowdown and the loss of millions of jobs. That's why a summit conference with our major trading partners can be helpful. It's a chance to reaffirm our belief in free and fair trade, talk over the problems of protectionist legislation, and help provide a climate for the free flow of goods and commerce. It also gives us a chance to talk over other issues, like our goal of extending prosperity to the developing nations of the world. Right now the international community is helping these developing nations deal with the serious problem of heavy debt burdens. And just as this summit is helpful in coordinating our trade policies and our efforts to help spread prosperity to the rest of the world, our discussions in Venice will permit us to address such diverse topics as agricultural problems, terrorism, drug abuse, and the AIDS epidemic.
So, too, the relationship between the free nations of the world and the Soviet bloc will be much on our minds. You probably know, for example, some very serious negotiations on arms reductions are reaching a critical stage. These negotiations affect our allies, so it's essential that we maintain our commitment to their security as well as our own. We also need to reaffirm our pledge to a strong defense while exerting pressure on the Soviets for progress in such areas as regional conflicts, like Afghanistan, and human rights.
So, the agenda next week is a full one. But certainly one source of encouragement is our record of accomplishment not only for the past few years but during the past four decades. Forty years ago this week, then-Secretary of State George Marshall announced an economic recovery plan for the European nations devastated by World War II. The plan was not a giveaway program; it was instead an incentive-oriented effort to get European nations to work together and build a new prosperity, a prosperity built on self-help and mutual love of freedom. It's this same idea of freedom which has kept much of the world at peace for four decades and brought rising standards of living to the average person. That's what we'll be seeking to advance further in Venice. Our goal now is, together, to build on this record of growth and opportunity for the future, as we've done in the past.
Until next week, thanks for listening, and God bless you.
Note: The President's address was recorded on June 5 at the Villa Condulmer in Mogliano, Italy, and was broadcast at 12:06 p.m. on June 6.