This is a transcription of this speech made for the convenience of readers and researchers. A copy of the text of this speech exists in the Senate Speech file of the John F. Kennedy Pre-Presidential Papers here at the John F. Kennedy Library.

The Democratic Party is under constant attack today as an irresponsible, spendthrift party -- a party which wants to spend too much for defense -- for education -- for housing -- and for all the pressing needs of a great and growing nation.

But the facts of the matter are that this Republican Administration has saddled upon our nation the costliest policy in our history -- the policy of high interest rates and tight money.

Let me cite a few of the costs of this irresponsible, spendthrift policy.

The first is the cost in small business failures. When money gets tight -- when interest rates climb -- the small businessman finds that he cannot obtain or cannot afford -- the capital he needs to expand, to reinvest, or to meet the current expenses of a struggling new business. As a result, in the last eight years, the rate of small business has grown to twice what it was in 1952 -- twice as many hopes broken -- twice as many jobs lost -- twice as much income erased.

Second is the cost in unbuilt private homes. Today, if you buy a $20,000 home on a thirty year mortgage your cost over the thirty year period will be $43,200. The interest cost is greater than the cost of the house itself -- and more than $9,000 of this interest is the direct result of the high interest rate policies of this Administration. And this fantastic added cost does not only mean distress for the family -- it also means economic distress for the entire construction industry. For higher priced homes mean fewer homes -- fewer homes for an expanding population desperately in need of housing.

Third is the cost of unbuilt public works. Every dollar borrowed by a city or a state costs twice as much -- in terms of increased interest -- as it did in 1952. As a result, we cannot afford to build the hospitals, the schools, the parks, the sewage systems, and the hundred other public improvements which our exploding and overcrowded cities desperately need.

Fourth is the cost to the Federal Government. High interest rates are not only paid by citizens and cities -- they must be paid by the Federal Government itself. Today we pay $9 ½ billion each year for interest on the national debt -- three billion dollars more than we paid in 1952. With this three billion dollars -- most of which is the product of this Administration’s high interest rate policy -- we could double our spending for new Polaris submarines, for aid to India and Latin America, for improving our national forests, for construction of housing and schools. But instead of using this money to meet our great national needs -- it is paid out in high interest alone -- building nothing and producing nothing.

Fifth is the cost in slowed down economic growth. It is incredible that at a time when four million men and women are unemployed -- when our economic growth is only half of what it was eight years ago -- that we would deliberately adopt a policy intended to slow down our rate of growth. But that is exactly what the high interest rate policy does -- and is intended to do. By restricting money -- by tightening credit -- we keep business from getting the capital it needs to thrive -- to expand -- and to create new jobs. There is no reason why new economic policies in 1961 could not increase our economic productivity by $50 billion -- cut unemployment in half -- and bolster purchasing power.

This costly tight money policy can -- and must -- be reversed. The techniques are available. They are well known. First, the Federal Reserve Board must overcome its reluctance to increase the supply of money. It can do this by purchasing government bills now held by financial institutions. Second, there is no reason for an inflexible reserve requirement. When we need more credit in the economy let’s permit the banks to expand credit. When we need less, we can increase the reserve requirement. Third, other techniques such as the Federal Reserve rediscount rates and open market operations should be used to control interest rates. Fourth, reduction of the national debt through sound fiscal policies will inevitably be reflected in reduced interest rates.