In the last year, we have spent an enormous amount of effort and energy putting this nation's economic house in order...setting the stage so the United States can compete in the new, global environment. We passed the budget resolution to get control of the deficit ... signed NAFTA into law...and we have done everything possible to conclude the GATT talks on a positive note to ensure world economic growth and markets for our exports.

But all of this effort will be for naught if we do not give all of our children a world-class education.

Secretary Reily recently showed me a report that compared this nation's educational standards to those of 24 other developed countries. This report tells us that American higher education does a very good job of preparing our young people for the job market ... and that we are far ahead of the rest of the world in terms of educating women. This is the good news. The report also tells us, unfortunately, that we do just an average job when it comes to teaching reading...that we are still lagging when it comes to teaching science and math...and that we can be much more innovative when it comes to how we spend our money.

The overall message of this report is clear and urgent. If we Americans want to compete in the global economy, we have to do a better job of preparing our children. We can't be selective, we can't afford to stay with the status quo, and we can't continue to give any of our children a watered-down curriculum. I am a strong believer in raising expectation in striving for excellence, and in making sure every child gets a world-class education.

As I travel around the country, I am always moved by the energy and enthusiasm of our young people. Many of them know that the world is changing and that an education remains their best chance to make it in this society. They've gotten the message that you aren't born smart; rather you get smart by stretching your mind. A great many of our young people -- including many more minorities, which is very encouraging -- are taking the tougher courses, taking the Advanced Placement tests, and getting serious about their education. There has been an enormous leap in their expectations and aspirations. This is good progress and tells us that the school reform movement is headed in the right direction.

But there is another group of young people. This group has different expectations about life. They have already disconnected and given up hope. They take their despair and violence into our streets ... they become young teenage mothers and move into our public housing projects ... they enter our prisons as illiterates. They are our young people who have dropped out of school. So many of our school's dropouts reach the conclusion that their lives have to be short, angry, and often violent. Something has been lost in their human spirits and when they drop out of school, we often lose them for good.

So this generous gift by the Annenbergs and the continuing effort by this Administration to reform and reinvent American education is much more then just putting a few more computers into the classroom. We are putting our money and our reform efforts behind the one institution in our society -- public education -- that has the capacity to reach these young people before they give up ... to keep them connected. Public education, for all of its many problems, remains our best hope of giving these young people the leg up in life they so desperately need.

Public schools at their best -- and there are many of them -- are the one sure anchor in the lives of these young people. There are literally thousands of dedicated principals, teachers, counselors and community people who are doing the Lord's work in trying to reach these young people. But they can use our help. With the whole world stacked against them, about the last thing these people need is a watered-down curriculum. This wonderful gift by the Annenbergs is their challenge to all of us not to give up on these young people.

I believe we are up to this challenge. We can raise expectations, strive for excellence and give every child a world-class education. There is an enormous amount of good, solid legislation in the congressional pipeline next year including GOALS 2000, the re-authorization of the Elementary and Secondary Education Act, including reform of Title 1, and our Safe Schools legislation.

What is so important about the Annenberg Challenge is its very direct and supportive link to our GOALS 2000: EDUCATE AMERICA ACT which will establish for the first time "voluntary" national goals of academic excellence. GOALS 2000 will provide a "lighthouse" of challenging standards to make American education internationally competitive, and provide the seed capital to school districts across this country to reinvent themselves to meet these challenging standards The Annenberg challenge will give us new models of the first-class education needed to reach world-class standards, and the alliances and networks to make change happen.

Together, these models, alliances and networks set the stage for a second decade of school reform to reach our goal of a world-class education for every American child. This type of challenge -- and what a challenge it is -- is a challenge to all Americans in business, foundations in the public and private sector not give up on our children, but to roll up their sleeves and help us in this great reform effort.

I thank Ambassador Annenberg on behalf of the American people of this generous gift.