This is an extraordinary time, and this room is an extraordinary place to be because of it. Local activism is animating our communities. The American people are rejecting the old forces of divisiveness and extremism. We enjoy, as a nation, an unprecedented growth, prosperity and peace. This is what historians call an "open moment" -- a time of limitless possibility; a time when we can grow stronger together as a nation.

And the American people have shown their ringing support for the course we have mapped out together -- from the rough waters of 1992, to the expansive horizons of the present and the bright prospect of the near-future.

Let's look back on the past six years, and on the remarkable leadership of President Clinton. Together with the DLC and the American electorate, we did what we promised -- and that promise was ambitious. We began by inventing a new and vibrant politics of the center -- a politics that moved not left or right, but forward. A politics that allowed us to begin the most important work of our lifetimes: redeeming the very idea of self-government -- and using it as a force for good in the lives of the American people.

We balanced the budget -- and with a revitalized economy, we made record investments in education, job training, and the cutting-edge research that is the heart of innovation and growth.

We demanded responsibility from those on welfare -- and instead of spending that money on welfare checks, we dramatically expanded opportunity, so millions could say goodbye to welfare, and take their proud places in our workforce.

We enacted tough new punishment to get gangs, guns, and drugs off our streets -- but we invested just as much in prevention and treatment, for we are a nation of both laws and compassion.

It feels so good to say, on behalf of the American people: thank you, DLC, for so many of the ideas and the vision that have moved this nation forward.

I come before you today to issue a new challenge. Six years ago, we moved politics forward -- beyond left and right. Today, let us move politics not only farther forward, but also upward, to a higher place -- to a place far beyond the false divisions and dichotomies of the past.

For the great insight of our time is the fact of our mutuality, our connection to one other. The old ways that didn't work saw only separate, competing entities. This tired, destructive thinking saw the world in terms of conflict -- irreconcilable opposites: the individual versus the family; labor versus capital; white versus black; religious versus secular; work versus family; old values versus new opportunities; America versus the rest of the world.

In this "us versus them" thinking of the recent past, a vision of the common good struggles mightily -- often futilely -- to transcend the whole.

But transcend we must. It is only when we have built the strongest of foundations that we can raise the highest of banners.

Today, I challenge America to raise that banner -- raise that banner with a new "practical idealism" for the 21st Century. By strengthening the bond between progressive goals and responsible governance -- by leading boldly from this new and dynamic center -- we can strengthen the bonds between us all, and we can affirm our proudest potential: jobs and opportunity, safe streets, strong communities, and a clean environment; equality of opportunity and fundamental fairness, global strength and security.

Some now say that what we need is "compassionate conservatism." They call for opportunity, combined with responsibility. Hmmm... I wonder where that came from? It sounds familiar.

Let us be clear: we welcome all who truly want to join us in this vital center. But there is a difference between using the rhetoric of the center, and actually governing from the center.

There is a difference between using the right language, and seeing the right connections between new policies and progress -- between talking about compassion, and actually putting your highest ideals into practice.

Compassion is more than a pretty word: it is the highest of all disciplines. Compassion means reserving the surplus until we save Social Security first, so that all Americans have the retirement they deserve -- not going back to the risky tax schemes and economic upheaval of the 80's. Compassion means ensuring that all our children, even the children of middle-class families who can't afford private school, have a first-class education, in a first-class school where excellence is the standard -- not draining away the dollars from our public schools. Compassion means more police on the beat, and fewer guns on the street -- not an agenda that's written by the gun lobby, lock, stock, and barrel.

And compassion means understanding that whatever your personal view of abortion, women must have the right to make that personal choice for themselves, in the privacy of their own consciences. Compassion also means seeing the connections between a happy baby and a productive worker -- and between a well-planned, walkable suburb and rising home values that protect a family's biggest investment.

We welcome the apparent suggestion by some Republicans that they want to move their party to the center -- that they want to fashion their own new centrist philosophy. But we know that there is a long road between rhetoric and results. For six years now, the wisdom of our approach has been born out by the fruits of our work.

America needs something better than compassionate conservatism -- we need an approach that will take this country forward, not backward; and not only forward, but also upward. An approach that recognizes the limits imposed by fiscal discipline, but reaches for limitless new possibilities in our economy, in our schools, in our environment. An approach that applies the values of the past to the amazing opportunities of the future. America needs a new practical idealism for the 21st Century.

The Republicans seem always to be pulled backward before they can translate their rhetoric into policies their party can actually support. Listening to a so-called compassionate conservative speak from the podium of a Republican National Convention reminds me of nothing so much as Theodoric of York -- the delightful character from the Middle Ages, once played by Steve Martin on the old Saturday Night Live. After indulging in the most grotesque and primitive practices in medicine or the law -- applying leeches to bleed the sick, or dunking witches in vats of oil -- Theodoric would pause for a sudden blinding insight, and question whether we need a new, enlightened approach -- whether due process of law, or the scientific method, or the rule of reason. And after musing poetically about the possibilities of the future, he'd admit: "Naaah."

That is so often the reaction of the real Republican Party to the rhetoric of so-called compassionate conservatives.

You know, we have seen what wisdom comes when we allow our values to bridge the old dichotomies. Between the old polarities of the welfare state and laissez-faire lie the tools of empowerment. Empowerment is based on the idea that all people deserve equal opportunity -- that all people, whether rich or poor, have the right to judge what they need, and have the right to identify and work toward their dreams.

And there is no greater expression of empowerment than education. Now more than ever, in this Information Age, we see that knowledge and learning can bridge our greatest divides. With smaller class sizes and highly-trained teachers; with libraries and classrooms that are connected to the Information Superhighway, eventually right down to the last desk; with more choice and competition in our public schools, and with challenging classes that teach responsibility as well as reading, writing, and arithmetic -- we can succeed together, and unleash the potential within every child, every classroom, and every workplace.

As we move from the politics of our past to the higher politics of our future, we must examine the new false choices that need to be overcome if we are to fulfill our deepest values. For too long, there was an us versus them mentality that pitted labor against capital, capital against labor. Now, when we look closely, we see that business leaders who invest in training and education become more competitive. And when labor works with management to clear away outdated work rules, and become more innovative and productive, they strengthen their own future.

Even beyond the workplace, a strong economy is built on our connections. Neither labor nor capital could succeed without the fiscal discipline that has fueled today's prosperity -- and we could not have balanced the budget without the investments in education, in research and development, in new technology that have given us strong and steady growth. Now that we have balanced the budget, we should balance it every single year. We should see the connection between opening new markets to sell our products around the world, and full family bank balances here at home. We should see the connection between reinventing government, to make it work better and cost less in this fast-moving economy, and freeing the resources we need for 21st Century investments -- such as the Next Generation Internet, which will again spawn whole new industries undreamed of only a few years ago.

Beyond the old polarities of family versus the individual lies the new wisdom of how to balance and integrate the two. We are all connected as family. At times, our own party diminished and even disparaged the role family can play. By contrast, we now honor the healing power families can bring to their loved ones. We respect the fulfillment of love that family brings.

That is why Tipper and I have sought to restore that healing connection through the Family Policy Conferences we hold each summer in Nashville; this summer will be our eighth, focussing on the connection between families and communities.

The negative old conventional wisdom saw family-friendly policies as a drain on the bottom line; it was kids versus profits. Now we know that good policies that support families in the workplace are good for business too; governing from that wisdom creates a win-win situation -- particularly for working moms, whose schedules became a battleground. And we now know businesses that respect and accommodate their workers' responsibilities to their families have less absenteeism and turnover and higher longevity and profits.

And after all, one of our highest ideals is an America in which it should not be so hard to be a good, strong family; one in which parents and children have the most precious of commodities -- time with one another; in which women and men are not faced with the bitter choice between being a good worker and a good nurturer. We now know just how important it is to have that time to nurture our babies; new research, after all, has taught us that the first three years are indeed critical to a child's brain development, and can have a lifelong impact on a child's intellectual and emotional well-being.

In a two-paycheck or time-off family, families need flexibility if they are going to stay strong and resilient. In a Beavis and Butthead world, parents need control over the onslaught of violence and degradation coming at kids over the airwaves. Families need policies that support fathers' taking care of their children from birth to adulthood -- and for the deadbeat dads who don't, policies that force them to pay what they owe.

Some people talk a lot about family, only to idealize it. Republicans serenaded mom and apple pie, even as they twice vetoed Family and Medical Leave Act -- leaving mom to struggle without security when a baby needed her care. We see that it is too damn hard right now to pay the bills, juggle day care, and spend time with your kids; and instead of just sentimentalizing a family that no longer exists, we are giving the support you need to the families you really are. Child development policies, day care, Family and Medical Leave: your kids need the best and we intend to help you provide it. Together, we put their needs at the very top, supported by everything else.

As we who are in our fifties now know, our pressing family needs don't end with our children. We are the first generation to have more parents than children; the needs of our elderly parents are powerfully on our minds. Many feel alone with the duty they want to show their elderly parents. So many Americans have told me about their helpless grief at not being able to afford a home health visitor for a frail mother or father; home health aides can cost two hundred dollars a day. Many are thinking daily of their homebound parents far away, who may be living alone, who risk a fall or a fracture with no one to look out for them.

We need policies that honor and support the dignity of caring for an elderly or disabled family member. We need to do more to connect the generations -- by helping young people to reach out to our senior citizens as mentors, as care givers, and as friends. Because the values we should be able to show our parents are filial love, fully grown: duty, kindness, gratitude, and tenderness -- befitting the gifts they gave, all our lives, to us.

Not long from now, when my generation of Baby Boomers starts to retire, we will have the fewest-ever wage-earners for each person drawing Social Security -- two workers for every retiree, down from more than three today, and down from five a generation ago. Can we even doubt that those young workers have a stake in the Social Security system that they will be paying for -- or that those retirees should be concerned when our children are learning in overcrowded classrooms, and 40 percent of them don't read as well as they should? To paraphrase my friend Governor-elect Gray Davis, I don't know about you, but when I retire, I don't want the two workers supporting my pension to be in that bottom 40 percent. We have an obligation to invest in their education and lifelong learning today.

Beyond the old polarities of individual choice and national government lie the subtle connections that are the matrix of community.

Just look at how our failure to honor our connectedness almost destroyed the American landscape: the panorama of sprawl outside so many of our cities -- the chaotic, ill-planned development that makes it impossible for neighbors to greet one another on a sidewalk, makes us use up a quart of gasoline to buy a quart milk; makes it hard for kids to walk to school or for children to have anywhere safe to play outside. This is a vivid manifestation of how badly things go awry when we refuse to look at the whole picture. This style of growth is not the American way -- the American tradition of building is the very architecture of community. From the open village greens of our beautiful old New England towns, where our forebears in the Eighteenth Century gathered to debate the news of the day or simply to watch their kids play and pass the time of day with their neighbors, to the mixed-use development of New York's Lower East Side where families could watch out for each other's kids while securing a firm foot on the economic ladder.

Things only went off track within the last few decades; the sprawl that breaks our hearts and separates us from one another, and our homes from the environment around them, doesn't have to be that way. We can support this movement: many communities from coast to coast and in between -- working with developers, working closely with homebuilders -- are recreating an architecture of community, so that your precious time can be spent after work with your kids or your spouse or your friends, rather than stuck in traffic, where the freedom of the open road can explode into commuting-induced road rage. Drivers in our nation's capital spend an average of two full work-weeks per year idling in traffic! People move out to the suburbs to make their lives and seek their dream, only to too often find that they are playing leapfrog with bulldozers, longing for the meadow that used to be the children's paradise at the end of the street. Instead of parks and playgrounds and open spaces, they find some appalling neon nightmare defacing their once-nurturing neighborhood.

You deserve livable communities, comfortable suburbs, vibrant cities, and green spaces all around and in between. And you can have them. You deserve an approach that connects the clean environment we deserve with the thriving economy we demand -- by realizing that polluted lakes and streams, dirty air, and abandoned "brownfields" in our central cities are economic opportunities -- chances to create jobs by cleaning up our precious resources. You deserve cities that are alive with new investment and jobs -- where we build up our rich urban assets, rather than just cataloging neglect and decay. You deserve them -- and you can have them.

You deserve communities that are safe, policed by well-trained community police officers who walk the sidewalks and establish relationships with every shop owner and every parent. You deserve a criminal justice system that takes repeat offenders off the streets for good and that promises swift and certain punishment to those who violate our laws. And you deserve an anti- crime strategy that is built on prevention, as well as punishment. We all know that the best way to take violence off our streets is to give our children safe, supervised places to learn and play when parents are still at work.

Safety means a new respect for privacy, and new ways to protect it, at a time when your credit card number, your Social Security number, and even your identity can be stolen when you make a simple purchase at the drugstore.

In order to safeguard our future and prepare for the opportunities that await us, we must also look over the horizon, and remember our unique place as Americans in the world.

Though many of the dangers we face are new, the truth we learned earlier in this century from FDR is as true today as then: "our own well-being is dependent on the well-being of other nations, far away... We have learned to be citizens of the world, members of the human community."

Today, more and more families and businesses have a stake in the financial markets that stretch to every corridor on our globe. But you only need to earn a paycheck to feel the storm clouds of the global economic crisis hanging overhead. More than ever before, we are all connected through commerce and trade. Protectionism is little more than protection from billions of new consumers who can buy our products. Isolationism merely isolates us from the leverage we need to push for tough financial reforms, and for the international solutions that can make our world economy as strong as our own economy. And let us not forget that through our vigorous engagement of free markets, we have advanced fundamental freedoms and fairness around the world -- from labor rights and environmental protection, to market-based solutions to global warming, to international coalitions against terrorists and rogue states, to the democracy and self-government that we hope will find its way to Malaysia, to Cuba, even to China in the century ahead.

And if, as we are beginning to realize, we truly are all connected, then America is at the forefront of turning that insight into lasting good, and we must shoulder our responsibilities. America is still the one indispensable nation. Our military strength and economic security are the foundation of every freedom we enjoy -- every alliance we sustain -- and every healing gesture we extend.

We need to stop pretending -- any of us -- that America has an option to withdraw from the world. We don't. Our future is in the world. Our only choice is to move forward and upward -- to accept our responsibilities and discharge them with honor, with dedication, with skill -- and with practical idealism.

We can take heart in the knowledge that so much of the world, eager to escape the brutalities and injustices of the past, is eager now to put our ideals into practice. Our future depends upon their success. And that is why the policies and the progress that we advocate here today can strengthen the greatest connection we know: that of our humanity. As Gandhi said: "we must become the change we wish to see in the world." At the dawn of a new century, we have a chance to do just that.

We choose our Americas. From today, we can choose an America in the year 2100 that is stable, prosperous, equitable and at peace, because we will have moved to the highest ground from which to govern. Or we can choose an America in 2100 that is still plagued by false divisions, conflicts, and instabilities that should be relegated to the attic of the past. Let us choose the future that is built on the insight of our mutuality: mutual respect, mutual responsibility, mutual civility, and, in regards to the weakest among us, mutual kindness and care. As it is written in the scripture: "If one part suffers, every part suffers with it; if one part is honored, every part rejoices with it." Let us choose that future for your children -- and mine; and for all their brothers and sisters around this country and around this small, irreplaceable world. Thank you.