Unemployment is up, inflation has risen, housing prices have stalled, and bankruptcies are at a record high. The price of oil is through the roof, we are on dangerous territory with Iran, and the great communist nation on the other side of the world is on our heels. Meanwhile, the President of the United States still doesn’t understand why Americans will not simply pull themselves out of their funk.

Welcome to the year 1980.

The resemblance between 1980 and 2012 doesn’t stop at economic conditions and foreign troubles. The year 1980 was also when citizens went to the polls to answer a fundamental question: Should Americans still govern themselves?

Ronald Reagan was elected because he understood that this was the main issue. He answered this question without reserve: Trust the people.

On this day in 1981, Ronald Reagan stood on the steps of the Capitol and delivered his first inaugural address to the American people. He declared:

From time to time we’ve been tempted to believe that society has become too complex to be managed by self-rule, that government by an elite group is superior to government for, by, and of the people. But if no one among us is capable of governing himself, then who among us has the capacity to govern someone else?

Reagan used his inaugural address to affirm his trust in the American people. Instead of relying on government to fix the American recession, he knew that “government is the problem.” Reagan took great care to emphasize the achievements and responsibility of “‘We the people.’ This breed called Americans.” He struck at the heart of the progressive–liberal conceit: “It is time to check and reverse the growth of government which shows signs of having grown beyond the consent of the governed.”

Reagan connected his trust in American exceptionalism to the attitude of ordinary citizens in his moving quotation from the diary of a hitherto obscure American casualty of World War I, Martin Treptow, who wrote “I will fight cheerfully and do my utmost, as if the issue of the whole struggle depended on me alone.”

Reagan also recalled the achievements of the American Founders, in particular their confidence in self-government and individual freedom. The new President presented himself as a follower of the Constitution. “Our government,” he emphasized, “has no power except that granted it by the people.”

For an America beset by economic woes and a vacillating foreign policy, Reagan’s first inaugural address was a necessary reminder that only “We the People,” exercising freedom, can revive America. This message is even more pertinent today.