Excerpts from President Reagan's speech last night:

Shortly after taking office, I came before you to map out a . . . plan for national economic recovery . . . . We have made strong, encouraging progress. . . .

Yet, in recent weeks we've begun to hear a chorus of other voices protesting that we haven't had full economic recovery. These are the same voices that were raised against our program when it was first presented to Congress. Now that the first part of it has been passed, they declare it hasn't worked. Well it hasn't--it doesn't start until one week from today.

There have been some bright spots in our economic performance these past few months . . . .But let me be the first to say that our problems won't suddenly disappear next week, next month or next year. We are just starting down a road that I believe will lead us out of the economic swamp we've been in for so long . . . .

Our immediate challenge is to hold down the deficit in the fiscal year that begins next week. A number of threats are now appearing that will drive the deficit upward if we fail to act. For example, in the euphoria just after our budget bill was approved this summer, we didn't point out immediately that while we did get most of what we'd asked for, most isn't all. Some of the savings in our proposal were not approved; and since then, the Congress had taken actions that could add even more to the cost of government.

The result is that without further reductions, our deficit for 1982 will be increased by some $16 billion. The estimated deficit for '83 will be increased proportionately. And without further cuts, we can't achieve our goal of a balanced budget by 1984. . . .

Last week, I met with the Cabinet to take up this matter. . . . Our government must return to the tradition of living within our means and must do it now. We asked ourselves two questions--and answered them: "If not us--who? If not now--when?" . . . .

. . . We propose to dismantle two Cabinet departments--Energy and Education. . . . We do not need an Energy Department to solve our basic energy problem: as long as we let the forces of the marketplace work without undue interference, the ingenuity of consumers, businesses, producers and inventors will do that for us.

Similarly, education is the principal responsibility of local school systems, teachers, parents, citizen boards and state governments. By eliminating the Department of Education less than two years after it was created, we can not only reduce the budget but ensure that local needs and preferences--rather than the wishes of Washington--determine the education of our children. . . .

. . .I intend to forward to Congress this fall a new package of entitlement and welfare reform measures--outside Social Security--to save nearly $27 billion over the next three years . . . . Many of these programs may have come from a good heart, but not all have come from a clear head. . . .

We can be compassionate about human needs without being complacent about budget extravagance . . . .

None of these steps will be easy. We are going through a period of difficult and painful readjustment. I know that we are asking for sacrifices from virtually all of you. But there is no alternative. Some of those who oppose this plan have participated over the years in the extravagance that has brought us inflation, unemployment, high interest rates and an intolerable debt.

I grant they were well intentioned but their costly reforms didn't eliminate poverty or raise welfare recipients from dependence to self-sufficiency, independence and dignity. Yet in their objections to what we've proposed they offer only what we know has been tried before and failed . . . .

. . . I'd like to turn to another subject which I know has many of you very concerned and even frightened . . . .

The Social Security retirement fund has been paying out billions of dollars more each year than it takes in and it could run out of money before the end of 1982 unless something is done . . . .

I am asking the Congress to restore the minimum benefit for current beneficiaries with low incomes. It was never our intention to take this support away from those who truly need it . . . .

Let me point out our feet were never embedded in concrete on our original proposal. We hoped it could be a starting point for a bipartisan solution to the problem . . . . But the majority leadership in the House of Representatives has refused to join in any such cooperative effort.

I therefore am asking . . . for restoration of the minimum payment and for interfund borrowing as a temporary measure to give us time to seek a permanent solution.

I know that we are asking for economies in many areas and programs that were started with the best of intentions and a dedication to a worthwhile cause or purpose. But I know also that some of those programs have not succeeded in their purpose . . . .

This does not mean we should discontinue trying to help where help is needed. Government must continue to do its share, but I ask all of you as private citizens to join this effort, too . . . .

I believe the spirit of volunteerism still lives in America. We see examples of it on every hand--the community charity drive, support of hospitals and all manner of nonprofit institutions, the rallying around when disaster or tragedy strikes.

The truth is we've let government take away many things we once considered were really ours to do voluntarily out of the goodness of our hearts and a sense of community pride and neighborliness.

I believe many of you want to do those things again, want to be involved if only someone will ask you or offer the opportunity. Well, we intend to make that offer . . . .