This paper is a report of the proceedings and a synthesis of discussion from a conference on the state of basic skills in American education held in Racine, Wisconsin, in April 1977. The participants were national education leaders, including specialists in different curriculum areas, legislators, public school administrators, and leaders from state and national education organizations. The group was charged with analyzing requirements for the development of competence in language skills, computing, and other basics. It was asked to sort out the issues in the back-to-basics movement, which calls on educators to give greater emphasis to basic skills. The conference participants discussed the fundamentals of student development, such as fostering creativity, social and civic responsibility, economic capability, and humaneness, as well as traditional academic skills. This report concludes with a discussion of evolving policy on the basics in education. (Author)