I speak for those whose voices are too seldom heard, the thousands of Hoosiers who go to work, pay their taxes, obey the laws, and save for the future.

Tonight, I speak for Indiana's middle class, those who feel threatened by economic uncertainty, abandoned by ineffective government, and alarmed by family and social decay. Too many fear the American Dream is slipping away. Too many walk an economic treadmill to nowhere, working harder and longer to take home less and less.

They feel that government no longer works for them or cares about their concerns. They feel overtaxed by a government that underperforms, fear a government that creates problems not solutions, delivers excuses not results.

They know there is something dramatically wrong when the middle class' standard of living declines while the size of government grows.

This evening, I give voice to their concerns and embrace their cause.

We must stop government from doing more harm than good. We must fight higher taxes, excessive spending and bigger bureaucracy.

We must do all these things -- and more.

We must not only say what we are against but what we are for. We must make government work for middle class families again, make it a positive force, and instrument for opportunity, growth and constructive change.

So let us honor the values of our middle class, address their concerns and create opportunity for everyone willing to work hard, play by the rules, and take responsibility for their own lives.

Let us build a government that is not only off our backs but on our side. Let us recreate a government that is both smaller and more just.

Let us insist upon a government that not only does no harm but a government that once again becomes a force for positive change and the greater good.

With your help, we have already begun.
 

Fiscal Responsibility: Protecting the Middle Class

Few things are more threatening to the middle class than busted budgets, debt and deficits.

In Washington, fiscal irresponsibility has bankrupted the nation. Higher taxes. Lower services. A legacy of debt that threatens our children's standard of living.

We have taken a different path, tightened our belts and forced government to do what Hoosier families must do every day: live within our means.

Since 1989, I have ordered $2.2 billion in spending cuts to protect middle class Hoosiers.

During the last two years alone, we have made the largest spending cuts in state history, $685 million.

We have stood up to the special interests, and the Medicaid monster which threatened to devour our budget has at least temporarily been tamed.

The number of state workers, excluding the state prison system, is actually lower today than it was six years ago, and state spending has increased less than personal incomes have grown, enabling middle class families and workers to keep more of their hard - earned pay.

The result of this strong fiscal discipline is a balanced budget with no deficit, and a balanced budget with no deficit means that taxes, once again, will not be increased.

For the federal government and many states this record would be remarkable. For Indiana, it is nothing new.

From 1989 to 1994, 48 states -- every state in the union but two -- raised income, sales, corporate or gas taxes. We in Indiana did not.

And if as I propose, we hold the line against taxes during the next two years, this will mark the first eight - year period since 1957 -- 40 years -- without a major tax increase.

I salute the bipartisan determination in the House and in the Senate, and the commitment of Speaker Mannweiler, President Pro Tem Garton, and Leaders Hellmann and Gregg to keep this record of fiscal integrity intact.
 

Cutting Auto Excise Taxes: Help for the Middle Class

With taxes in check and big government under control, we have put state government back on the side of our middle class.

Now, we must do more.

In 1990, with bipartisan support, I signed into law the first uniform cut in Indiana's auto excise tax since 1969.

It was a good idea. Hoosier motorists suffer license plate shock when they must pay hundreds of dollars in fees for even the most modest car.

The lottery allowed us to reduce that burden. Unfortunately, the national recession which ravaged the country from 1990 - 1993 cut state revenues by $1.1 billion creating painful choices to balance our budget: raise taxes, cut education funding, or temporarily suspend the new tax cut. Faced with these choices, the new tax cut was deferred.

Thankfully, the economy is stronger, revenue is up, and our aggressive spending cuts have balanced the budget.

A cut in auto excise taxes is possible once again.

This tax cut will go back into place January 1, 1996, with our budget still balanced and other pressing needs met, and will return $106 million annually to hard - pressed Hoosier motorists.
 

Property Tax Controls: Safeguarding the Middle Class

Unfortunately, there is another local tax that concerns Hoosier homeowners: the local property tax. This tax -- used by local government for a variety of local needs -- has been rising for years. if left unchecked, such increases will threaten the American dream of home ownership, a hallmark of our middle class.

The time to slow the growth of property taxes has come.

I propose cutting the projected increase in property taxes by $600 million over the next five years. To achieve this, I urge several specific steps.

- First, i propose making all new school construction subject to taxpayer approval. Schools will get all the new construction they need, but only at a price that taxpayers can afford. This step should reduce school construction costs by between 20 and 30 percent and plug a loophole which has hemorrhaged property tax dollars for years.

Second, I propose ending the dramatic rise in property taxes which takes place during years of reassessment. This step will save taxpayers nearly $100 million next year alone.

Third, I propose limiting the annual increase in transportation spending to 5 percent. Transportation costs have been rising nearly triple the rate of inflation, a pace we can no longer afford.

Last year, a bipartisan effort to control property taxes died on the final session day. We must not fail again. We mst slow the escalating tax burden on Hoosier homeowners by controlling property taxes in this session of the general Assembly.
 

Creating Good Jobs: Economic Opportunity for the Middle Class

This strong fiscal foundation is essential to addressing the concerns that trouble our middle class most: an eroding standard of living and increasing pessimism about our economic future.

Even with two parents working, the mortgage, car payment, child care, and college costs are harder to meet. There is growing concern that ours may be the first generation of Americans to have a lower standard of living than our parents.

We cannot let that happen, and there is no reason we should.

We have started by making sure that government gets the basics right: balances our budget, and keeps taxes low.

But our middle class expects government to do more than stand helplessly by while the battle for our economic future rages. Working Hoosiers expect aggressive action to foster opportunity and good - paying jobs, action to make us masters of our fate and put us back in control.

Thanks to your help and the able work of Lieutenant governor Frank O'Bannon, action has begun.

Last year I asked you to enact my EDGE initiative, a package of tax incentives for business to create good paying jobs.

With bipartisan support, you did.

I pledged that it would be a powerful engine for opportunity, growth, and good jobs. Without question, it has.

In just the last year, this step has helped create 3,534 good jobs, capital investment of $802 million and payrolls of $83 million a year.

That is more than 3,500 people who get up in the morning, go to work and make a living in good jobs. That is $83 million to individuals for work, not welfare. That is good jobs for Indianapolis, South Bend, Butler, north Vernor, Hammond, Portland, Evansville, Gas City, Franklin, Terre haute, Seymour, with many, many more still to come.

And that is not all.

Just last month we announced the addition of 1200 jobs to what is already among the largest job - creating projects in the nation, the United Airlines maintenance facility in indianapolis. These jobs pay more than $45,000 a year with full benefits. These are the kind of jobs around which you can raise a family, build a home and save for the future.

And there is even more.

During the past year an additional 50,000 new jobs were created across Indiana. State government did not sit on its hands, it was there to help.

We provided grants to train 12,000 workers for new  jobs and retrain 37,000 to keep existing ones.

These efforts show government at its best: helping people help themselves, creating opportunity, fostering economic growth. together with a vital private sector, we have helped forge an economy that is the envy of many states.

But with interest rates rising, the memory of the last recession still vivid, and economists predicting an economic slowdown next year we cannot be complacent.

I ask that we make the training and infrastructure investments to create and save 23,000 jobs for working men and women across Indiana.

I ask that we increase fob training assistance by $5 million and increase our investment in road repairs, sewer improvements, airport construction, port development, and other job creating infrastructure by $80 million.

This effort will help create middle class jobs today and lay a solid foundation for growth tomorrow. It will lessen the chances for recession caused by rising interest rates, and send a loud and clear signal that Indiana is open for business, open for jobs, open for investment open for growth. It will say that we do  not intend to merely wish for a better future, but are willing to roll up our sleeves and do what it takes on the middle class behalf to get the job done.

Next year when the economy slows Hoosier families will ask us, "What are you doing to help?"

This is the answer.

I ask that, together, we close the economic trap door through with too many workers have fallen and instead build an avenue of opportunity leading to higher wages, better jobs, and true hope for a more prosperous tomorrow.
 

Health Care Security for the Middle Class

Unfortunately, too may middle class families' hopes for a better tomorrow are endangered by uncertainty over health care today.

For an increasing number, changing jobs, previous illness or divorce means that coverage is not available when it is needed most.

It is time we acted to make health care more secure for our middle class.

I ask:

- That we shorten the time coverage can be denied for preexisting conditions.

- That no gap in coverage exists when an insured employee changes jobs;

and

- That the state establish a system of continuing insurance for all who lose coverage and can afford to pay premiums.

Let us act to protect middle class health insurance. Let us create security where now there is doubt.
 

Welfare Reform: Individual Responsibility, Middle Class Opportunity

While we foster health care security and good jobs for our middle class, we must also remember those who have fallen behind: those on welfare and other public support.

Welfare as we know t has failed. It has failed those on the rolls and those who pay the bills.

Welfare was never meant to become a permanent way of life lasting from one generation to the next. It was intended to be a temporary condition enabling those stuck by misfortune to get back on their feet. Unfortunately, welfare has fostered a culture of dependency, stifling initiative, diminishing work.

Dramatic changes in Indiana's welfare system have begun.

Starting this month, Indiana is implementing the most aggressive welfare reforms in the nation, emphasizing work, personal responsibility, and self sufficiency. This will promote the best interests of taxpayers and recipients alike.

Specifically:
-Welfare recipients are required to accept jobs.

- Training will prepare them for work.

Benefits will end after two years.

- Welfare mothers will no longer be paid extra money for having additional children.
 

School attendance by children on welfare is required.

- Immunization for children on welfare is required.

- And welfare recipients who defraud welfare or Medicaid are permanently banned.

These changes and many more will shift the focus of welfare from giving recipients benefits to getting them jobs. The result: opportunity and incentives for recipients, saving for taxpayers. During the next seven years 37,000 people will move off welfare and into work, cutting the welfare rolls almost in half, saving $140 million.

Some have criticized our effort saying that jobs do not exist. But this is simply not true. Many entry level jobs go begging today. The Department of Workforce Development estimates that 29,000 unskilled jobs are available right now, 450 were advertised Sunday in our state's largest newspaper and more than 15000 are needed by one restaurant chain alone.

Of course others argue that these are entry level or minimum wage jobs and are not good enough. I cannot disagree more.

There is nothing wrong with working in a grocery store. There is nothing wrong with working in a restaurant. There is nothing wrong with working in a gas station or as a maid. Thousands of tax paying citizens do these jobs every day. They may not be glamorous, but they represent honorable, dignified work and the first step toward a better life.

To those who say changing welfare is unfair to children, I say welfare is worse. It is tragic when kids grow up in homes where no one works, and that is what this effort will change.

And as we change welfare, we need to held fathers accountable, too. It is not right to bring a child into the world and then walk away.

It costs taxpayers too. Hoosiers would save $175 million this year alone if all parents supported their children. Just the top 92 deadbeats owe $3.7 million in delinquent support. One "deadbeat dad" has fathered 12 children with eight different women. His companions and kids are supported by welfare not him, costing taxpayers $56,000 last year.

To stop this flagrant irresponsibility, I propose:

- Aggressively intercepting state tax refunds and applying them to delinquent child support.

- Expanding automatic wage withholding to accomplish the same.

- Suspending driver licenses until support is paid; and

- Reporting delinquents to credit agencies.

I urge you to adopt these steps to change welfare and encourage child support and to enact the bipartisan proposal to do even more.
 

Fighting Crime: Physical Security for the Middle Class

Unfortunately, while we honor middle class values of work, opportunity and playing by the rules, there are some who do not. I speak of the alarming occurrence of mindless, violent crime.

Crime's real cost is not reflected in cold numbers or sterile facts. It is in the faces of victims. Those who have been robbed, seen a loved one shot or an innocent violated. It is felt in the diminished quality of our lives: when our homes are not secure, our kids are not safe, when fear walks our streets and stalks our lives.

The middle class's lost sense of security is not just economic. There has been a loss of physical security, too.

So we must act to fulfill one of government's most basic duties: ensuring our safety.

I ask that we establish "truth in sentencing" for those convicted of the most violent crimes and require that at least 85 percent of such sentences be served. I ask that we authorize pre - trial detention for dangerous felons and require that they be tried within a hundred days of arrest.

When judges and juries impose tough sentences, we must enforce them. When dangerous criminals threaten society, we must get them off our streets.

Now I realize that our continuing war against crime will require more prison space, and I say this with no joy in my heart. No one enjoys building prisons. But it is an unfortunate fact of life.

Tough laws without the means of enforcement are meaningless. Dangerous criminals will only laugh their way back to our streets.

I know some disagree. They say drug dealers and habitual drunk drivers are not dangerous and should be freed. Try telling that to a family whose loved one is addicted or the Churubusco family whose child was run down by a drunk behind the wheel.

I know still others favor expanding work release. But as you vote remember this: no system is perfect. Mistakes will be made. Is that a risk we should run? I do not think so.

And so I ask for the authority to build a new prison to protect the public and keep those who are truly dangerous off our streets.

But even tougher than the problem of adult crime is the explosion of juvenile lawlessness.

What ever happened to childhood? It is shocking when 13, 14, 15 year olds commit brutal, senseless crimes once reserved for adults.

Today, some 15 year olds are still kids; others sadly are not. Violence without remorse or even the slightest respect for others deserves only one response, regardless of age.

Time behind bars.

Over the last six years jail capacity for juvenile criminals has increased 60 percent.

Average jail time for juvenile offenders is up 75 percent.

And we will soon open Indiana's first boot camp to give nonviolent juvenile offenders the discipline, education and values they need to get back on the right path and stay there.

But for truly hardened offenders our system of juvenile justice too often lacks the appropriate tools. to correct this, I ask that judges be empowered to impose tough sentences similar to those for adults on juveniles who have committed the most serious crimes: murder, rape, robbery, criminal gang activity and more.

Young thugs who commit these offenses may be juvenile, but the crimes they commit are not. We mst shut the revolving door on juvenile crime once and for all.
 

Improving education: Our Children's Opportunity to be Middle Class

The steps I have outlined tonight will go a long way toward addressing the challenges we face.

But these concerns did not arise overnight and cannot be solved that way. There are no easy answers or quick fixes. It will take long - term solutions to achieve lasting results.

For our children to have a better standard of living, for them to achieve economic security, for them to inherit, as did we, the strongest, most confident nation on earth, it will require one thing above all else: lasting, fundamental improvement in the quality of their education.

To achieve this, strong action is needed. Along with Dr. Suellen Reed, our outstanding Superintendent of Public Instruction, strong action is what I propose.

First, I call for restoring order, safety and discipline to Indiana schools. Learning cannot take place in schools that are drug ridden, classrooms that are unsafe, or an environment that is undisciplined. An atmosphere of order and respect is essential. And so I propose:

- Permanently removing any student caught with weapons or illegal drugs:

- Allowing school officials to summarily suspend a student charged with a violent crime off school grounds;

- Streamlining disciplinary procedures for expelling disruptive students; and,

- Establishing a Safe Schools Fund to finance steps to keep weapons and drugs out of our schools

Second, I call for a comprehensive system of achievement exams based upon high academic standards, exams that will tell us how our kids are doing in the basics: reading writing, and math.

today, 40 percent of our kids do not meet even minimum standards and we pass them anyway!

It is not their fault that we promote them from grade to grade and even hand out high school diplomas when they cannot read or write. It is not their fault that the first time they discover something is wrong is when they apply for a job and are told, "You can't work here."

It is time for us to be honest with our children and honest with ourselves. We must set academic standards that reflect what the real world demands and tell our kids if they need to do better while they still can.

We need exams that require reading and writing, not just multiple choice. A system that helps our kids to think and solve problems, not just memorize facts.

That is what this program will do.

Third, I call for helping every child who needs to do better. Currently, we do not.

Last year 160,000 - 160,000 - Hoosier kids did not meet even basic academic standards and we did nothing about it.

That is a prescription for disaster.

The kids we do not educate today will fill the jail cells, welfare rolls, and dead end jobs of tomorrow. When they leave school they do not disappear, but without a decent education tier hopes and opportunities do.

And so I propose that every student who needs help gets it. this will mean longer school days for some and work during the summer for others.

It will mean alternative schools for kids who can make the grade but need a different setting to get there.

It will mean intensive teacher training 8,000 teachers a year, with an emphasis on reading, writing, and math -- to make our classroom educators the best they can be.

It means technology grants for schools to help our teachers teach, our kids learn and prepare for the good jobs of tomorrow.

It means accountability and it means results.

Students will get help but to graduate must learn what they need to know. And as we help kids in early grades, remedial costs will go down and funding requirements too.

I know some will argue that this is asking too much, that we spend a lot on our schools, and they should simply do better. But just telling our schools, teachers and kids, "Heal thyself," without more will  not work. Only dramatic change and the means to achieve it will ensure that results and our kids' futures improve.

Still others will say that more money alone is the answer. Well, we tried that approach, and it has failed. We cannot afford more of the same, only better will do.

Finally, some will say, Let us put all this off for a while, let us wait." Unfortunately, our kids' futures will not.

Gathered around me are the faces of Indiana's future, our children. It is for us to determine whether in the years to come they will be faces of hope or of fear.

Next year too many will leave school unprepared to get decent jobs, go to college or succeed in life.

To those who would wait I ask: ar you prepared to tell these children, "I am sorry. You had your chance. We are not ready yet. It is too late for you." I am not.

How long will we choose the comfort of complacency at our children's expense?

How long will the ease of denial keep us from facing hard truths?

A year? A decade? Or more?

Every year we wait, every year we lack the courage to act, their consequences and future costs grow.

The hour of decision has come.

So let us insist upon schools that are safe and secure.

Let us insist upon high academic standards that prepare kids for life.

Let us insist upon helping every child learn what they need to know and insist that they do.

Let us make our schools creators of hope, opportunity and a strong middle class once again.

And let us remember the words of scripture to "not be weary in well - doing, for in due season we shall reap if we ain't not."

Thank you and God bless us all.