Conversation 097-002

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I'm trying to get it.

I need to talk to the mayor.

I'm trying to get the name of it.

Good.

It's scary to put a hold on it.

I need someone to put a hold on it.

You want to be there to vote for us?

You're either going to do that or you're just going to retire from that role.

That's a good thing.

Demanding that let's see if this beer raises in this beer.

The Washington Post said this morning they were funding this.

Well, they asked for it, but it wasn't written on it.

It was written down on the table.

Oh, yeah.

I read that.

In other words, I said to the attorney, I've got a few bucks over the bed on me, and she just won't be able to get it out of her hands.

I haven't thought about it, and so have I.

So he didn't really have a mind to memorize them anyway.

He could never get to the truth of this thing.

Anderson hasn't really had a quick account of it.

He put it to one side and said, oh, it's like, it's the ones we're pre-existing on.

They...

They had, instead of Chinese and the SS and the ITT, if anybody over there ever brought up the point that, you know, if they did make a deal, or if they made the last deal ever known to man, I mean, they'd have been better off if they'd given Hartford up the chicken.

The stock market, as I recall, went down 7 points the day after, and within a week it went down 12 points.

I know this is not the right...

I understand that I can't see, and I don't understand, I don't know, what Auburn means to $100,000 that we were bidding for the Democratic Convention.

We can't get the goddamn state chairman to turn the letter over to us.

But I think I see a copy of it.

State to state.

We talked this morning because everybody is going off for Easter.

I'm not supposed to go off for Easter.

I'm taking account of where we are.

First, Mr. President, this card will obviously be something to be desired.

We've got so many legislative proposals that are presently in the Commission that it's hard to see on a chart one the flow of legislation and where it stands.

But I think it's generally from the chart here that there is, as of the midpoint between the opening of the second section of the Constitution, the break for 4th of July or 7th, so that we don't have to mention

There is a great mass of legislative proposals which the administration has submitted to the Congress Board, which is supporting what they're in.

The various committees of a relatively small number of bills are in Congress at the present time.

Looking very quickly over on the right-hand side, in the planning stage within the administration, no bills remain.

The last item of planning, of course, went into the student transportation moratorium after the Equal Educational Opportunities Act, which has now been introduced, are in proper committees of the Nelson Senate.

The second box over here in the case with an overview of the Congress that we've had some accomplishments to date.

In fact, we're at about the 20-yard line with a number of very important measures presented by the President.

Acted most favorably by the Congress.

The Constitutional Action Office for Drug Abuse, the bill, Revenue Act of 71, Economic Stabilization Act, extension of the drafts, movement towards an all-volunteer army, represents a lot of accomplishments to date, but quite obviously a great deal remains to be done

With the fairly limited time that remains, it seems to me, for this Congress to write the kind of record that we hope to go right.

In the 12-week period between the return of the House of Representatives to let it work on April 10th, and the adjournment for 4th of July, what obviously we're going to be,

...to move a great amount of legislation.

And that is the reporting period from April 10th to June 29th or June 30th.

And the major emphasis must be the place we hope on.

A number of critical items that the President has spoken about to the Congress...

Outlined as great goals in the State of the Union Address in 1971, reviewed in the State of the Union Address in 1972.

And I think they have good prospects for success.

Only five weeks probably will be spent, perhaps a little less than that, between the end of the Democratic National Convention and the start of the Republican National Convention.

The prospects for any legislative work after are...

The first of September, very slight indeed.

The president has offered a number of critical proposals which are in stage of development now and open for the Congress that we open this meeting and develop a technique to accelerate.

We of course are pleased with the general revenue sharing bill.

Here is the bill that will move out of the place it needs to be of the House of Representatives during the first week now of the Easter recess.

Chairman Mills advises Mr. President that April 11th and 12th will be the final action of the House Waste Management Committee on the General Residence Sharing Bill, and he hopes that that will be...

program for consideration passed in the House before the end of April.

We continue to believe that prospects for the favorable consideration of general revenue sharing in the House and the Senate are good.

The second proposal that has been a key element in your program has been welfare reform.

HR1 has

We are in hopes that HR1 can move through the Senate Committee on Finance before the end of April.

The various special revenue-sharing bills that form an integral part of your revenue-sharing proposal are present.

The bits and pieces of special revenue-sharing have been included in various bills that have been moving.

The Senate passed a housing bill that includes elements of supporting your special revenue-sharing programs in urban development.

Rural development proposals have moved more favorably in the Senate through our way of thinking than in the House.

Chairman Polk in the House has not been sympathetic to your proposals for rural, especially resident sharing, but there has been a rural development bill passed in the House, H.R.

12931, and we hope that with the more favorable aspects of the Senate passed bill.

The manpower bill is perhaps the best

for success in special revenue sharing before the end of this Congress.

In law enforcement, special revenue sharing, where Congressman Richard Klopp is so knowledgeable, I think it's unlikely that with the most recent provisions in the Law Enforcement Assistance Administration we'd see action this year on law enforcement and special revenue sharing.

Holding to your reorganization proposal, Mr. President, we remain hopeful that one of those four basic proposals, the Department of Community Development, will be terribly impacted upon in this Congress.

We need the chances where natural resources and human resources are supplied and supported as part of economic affairs.

We've been encouraged to

by a very recent discussion we had with Chairman Wilbur Mills, moving out of the health proposal, that Chairman Mills, after completion of general revenue sharing in committee on April 11th and 12th, will consider your pension proposal submitted to the Congress in late 1971.

And it's anticipated in the Press Barber Conference this year.

Thank you.

tell us whether this information is something anticipated, which means we would favorably consider mentioning legislation in a relatively short period of time, perhaps ten days or two weeks, and following that action by the way that it needs to be, Chairman Mills tells us that he will work intensively on the mandated employer-employee health insurance coverage proposal.

The...

One of the two proposals that are a critical part of your program.

Progress on the Health Maintenance Organizations Bill is less likely than on the National Health Insurance Partnership Act.

Wolverham continues to feel that the House can move on the National Health Insurance Partnership Act before it concludes for the Democratic National Convention.

I hope that's not too optimistic in your point of view.

Mr. President, the House is now debating, will accept, will be debating amendments today to the Water Pollution Control Act.

Proposing a general debate with the conclusion that

I believe it has bipartisan support, whether it will be the Maynard Amendment or the Rhodes Amendment, I'm not sure yet.

But would you take a minute and tell us about the importance of this amendment?

I think it is significant.

It has to do with some...

The way this bill came out of the public works committee, Mr. President, as contract authority for $18.5 billion worth of grants,

which goes to states on a formative basis.

It's similar in form to the provisions of the law which we now have.

It does change its form a little somewhat, and of course the magnitude is much larger, much greater.

The present bill operates under the traditional appropriating authority, and for the

Your budget to the Office of Management now asks for certain sums of money, and the appropriation process provides that or more.

For the last several years, the appropriate committees have provided more than the budget, because we felt that in downtown, if we hadn't done it, we were going to lose momentum on the way out to the floor.

So we were somewhat at a loss in Omaha, and it felt necessary to go to the Contractors' Order.

In fact, we feel that it's not necessary, and it's quite destructive, because this would mean, of course, that no committee of Congress would...

going to the meetings of the subcommittee, temptation to time to read with the members of the subcommittee on the importance of this whole effort to the overall welfare of the country from Congress.

So I'm sure that George is going to mount quite a charge on it.

He will offer the amendment and I hope it will succeed.

Now the amendment doesn't provide for the ordinary type of appropriations.

It provides for funding a year in advance so that the cities and municipalities and states can have a figure a year in advance as to how much they can spend.

And we think with that leeway, they will be able to operate an efficient program without the usual fear and wonderment about what Congress might do as far as incorporation is concerned.

The mining has been, gentlemen, I thought it was likely to be very close.

I think it will be very close.

Some of the members of the Public Works Committee are having second thoughts, and realizing that it would be much better to take the minimum amendment.

But other than that, we voted the bill out, so we're going to fight for it.

And I also mentioned to the members of the Senate that probably if we do prevail in the House, you're going to have a terrible fight in the conference to try to hold the House in position.

I don't know if we can or not, but this is at least the opening.

I don't know if we can practice that to save the appropriations process.

John, can I ask this?

Is George McMahon willing to make the commitment that from fiscal 73 and fiscal 74 he will put in the full amount of

If he doesn't make that commitment, he should forget the amendment.

Well, I'm satisfied that he will make that commitment, Jerry.

As you know, this used to be the public works of the committee, and we made that commitment as members of the public works of the committee.

I agree with you, without that commitment, the amendment would fail.

But the thing that would be preserved would be the congressional oversight of the program.

Thank you for that.

It's not that much money, it just makes a mockery of the whole budget process, not only from the president's standpoint, but from the congressional standpoint.

So it seems to me it's a matter of great importance.

George May, I've talked with George May a lot about it, and we're in support of what he's doing, although we're not making any commitments about the president's 74, or 75, or 75 budget.

Could I ask a question there, sir?

In this contract report, doesn't ONG have any control whatsoever?

We have control, it's a little more tenuous, but only in the sense that the agency reports to the president, so presumably they are at least somewhat responsive to what he wants.

On the other hand, the legislation that's being written

seems to be designed to cut that administrator off as much as possible from any executive branch authority.

Would you agree with me also that the implications of this for future legislation...

It are rather frightening with all of this movement for full funding of education and other things like this.

I can imagine that this would be a formula that most people would try to adopt in the future to get away from their appropriations cut down by appropriations.

Right, and there's something we'll talk a little bit about, the fight on inflation, and the concern about the budget in that regard.

A this and a multiplication of this would mean that there wouldn't be any to manage, either from the congressional standpoint or the executive standpoint, to try to manage the government's finances, which would lead us to disaster.

It's present in addition to the water bill, there is a favorable movement on any of the other items of your environmental package.

It's stuck in Congress where it's been since September, but progress is being made on pesticides, noise pollution, and other bills.

I think there is also significant development, particularly from Senators, I think Senator Donahue is particularly familiar with attitudes that are developing towards your Gripping Strikes Prevention Act, largely depending upon what may happen when they dock strike from the west coast and what decisions are made.

I hear, at least from senators and congressmen, an increasing interest and support for legislation along the lines of the American Strike Prevention Act.

I think it's important for us to remember that the House Subcommittee voted by a vote of 6-5, in which the Harvey proposal was defeated.

It was not a defeat where the administration's proposal was for a strike prevention, although there were elements of the Harvey bill that patterned the parallel elements.

But I sense, and I trust this is an accurate assessment, that there is a development movement

of support or legislation to provide a mechanism to prevent or terminate work-savages in the transportation field.

Senator Packwood of Oregon is working on this, as is Peter Dominick, and as are others.

And this is an important item in the legislative program that I'd like to see treated favorably, at least in the summer.

Thank you.

I'd like to ask Secretary Richardson to tell us briefly about the status of the Equalization Opportunities Act since we've had a big point of argument.

Thank you.

I think I should begin by saying that we have good reason to be grateful for the early opportunities that the House and committees for education and labor have.

have given us to be heard on these proposals.

I had the privilege of testifying four straight hours on Friday as a Senate side, and Mark said four and a half hours yesterday were ten, and soon have passed two.

Before the full Health Committee on Education and Labour,

I'm sure all you know, the feeling you have is repelling attacks from many different directions as to the soundness and defensibility of the proposal you're charged with speaking for.

And I think I can tell you after...

The interrelationships among the basis for the concept of the president's proposals in this area of dealing with the limitations of transportation and the support of equal educational opportunity are solid proposals.

I instead say that I haven't been hit by anything from any direction, and this seems to me

He's capable of a reasonably convincing response to anybody who wants to listen.

That's an important qualification, of course, because at this particular season, there are a lot of people up there.

Peter was there this day on the same side.

who not only don't want to listen, but who are really seeking only to score whatever kind of division points they can to the extent of the administration, no matter how awkward I was over the last 15 years or so, and I must say I have never seen that.

as an outrageous example of demagoguery.

I just can't believe something.

And of course, the press is really already interested in New England.

I really am suffering.

And of course, the press is really interested in picking up whatever they can get.

That way, it's the most colorful and outrageous thing.

So I don't think that what we've been saying has come through the media.

But I think it had made it as bad in the committee as they had listened.

I think this was particularly true in the House yesterday, which certainly turned out in a pretty hostile vein, but afterwards came up and said that he thought that we had maybe, after all, a pretty solid series of proposals,

You tell, spoke the other day in terms of seeing what you might be able to work out, and what that means.

But it's like taking a very few minutes to identify since Clark thought that it might be useful to you during the recess and in terms of people and whatever speech or talks you might be giving.

to know how we're handling the most common kinds of questions that are raised about this program.

On the educational side, the two questions that come up most often are, what do you mean new money, and why not use the Contemporary Education Authority under Title I of the Alumni and Senior Education Act?

I have some questions.

memoranda here which were prepared really for my use in response to questions.

But I'll pass them out on both of these things.

They're a little bit technical, but at the same time they give you an adequate answer to these things.

I would just say very summarily that after the new money, and no school system has had the benefit of the

program which we call the Emergency School Program, which is now a conference.

It called for 500 million dollars in fiscal 1972, a billion dollars in fiscal 1973, and the president has indicated that we would seek to make that billion dollar authority apply in two or three years.

And because of the delay in the enactment of the Emergency School Assistance Act, the cycle from 1972 is being shoved over into fiscal 73, so that we will actually have available in fiscal 73 a total of 50 and a half new money.

This would be combined with the money school systems are getting now under Title I.

There would be no change in Title I, no change in the method of distribution of money under Title I.

But through combining with the Title I money, money under the American School Aid Act, we can achieve an efficient total sum to produce at least $300 for each poor child in a school where there are children from economically disadvantaged backgrounds, that is, white or black or brown.

And one of the memoranda you have explains how this sum is derived.

We estimate that there are 3.6 million such.

The amount of money that is available through the combination of these acts is enough to produce not only the $300, but to increase that amount for schools that have very high concentrations for children, more than 30%.

And to increase the amount for as high as $400 in schools with 80% or more poor children.

So, the fact is that although we hear a lot about this is a pittance or a drop in the bucket or why don't you dump in five billion dollars into Title I, there is enough money here to produce the impact that the president identified in...

in achieving equality of education under 174, this barring the most severely disadvantaged circumstances.

Now that leads to the next point, which is, do you think the 300 million dollars would make any difference?

I mean, 300 dollars for a child, or 400 dollars?

Now, haven't you been saying that Title I isn't very effective and that compensatory education doesn't really work?

Yes, that is.

The Title I money has been spread by an arc to a tree, basically, in fact.

In the first place, it has not been concentrated in the schools where the largest numbers of disadvantaged children are.

In the second place,

Between 34-40% of this amount has gone for things other than basic education purposes.

For capital outlay, for compensatory physical education, and other non-basic purposes.

The $300 we're talking about here would have to go 75% to basic education.

And we have compiled the results of recent studies which show that there is a threshold at which compensatory education does make a difference.

and rate educational achievement.

That threshold is around $300, and I'm talking about $300 as a statutory number, but as an average for the use of this money.

As to the question why not use Title I, you have a memorandum that claims that rather fully.

The more compelling answer is that, as Tyler Watt has written, the only authority for concentrating funds on compensatory education for particularly disadvantaged children provides in effect that only 15% of total appropriations can be used for that purpose.

So that in order to produce the equivalent of the $900 million of compensatory education that we can achieve through combining

Title I and the Emergency School Assistance Act, it would require more than $7 billion in appropriations for Title I.

Our present appropriations request is about $1.5 billion.

That would mean adding $5.5 billion to the budget in order to produce the same compensatory education impact that we can achieve with the money already in the budget for Title I and the Emergency School Aid Act.

There are other reasons I would like you to remember as you ask.

The other kinds of questions we get, I won't review them.

They cover, of course, the issue of constitutionality, the question of what...

School desegregation plans will be reopened under the provisions for reopening in the mail once the congressional invitations on busing have gone into effect.

And what has this mean in terms of our continued support for the desegregation objectives of the American School Aid Act itself?

Just to say briefly that on the constitutional side,

I think the most effective points there are as to the moratorium, that this is in aid of the jurisdiction of the Congress to reach a resolution on the merits of the very complex issues that have concerned so many people.

Congress is in effect doing with respect to the protection of its own jurisdiction to reach

I think there are two important points.

One is that

The weight of constitutional analysis favors the proposition that Congress can deal with remedies, and that busing is a remedy for the right to equal educational opportunities.

Further, that the Supreme Court's decisions, particularly in Swan, have left open a gray area between what a judge may do

the exercise of inequity power, as in Charles Mecklenburg, and what a court must do.

And in that gray area, the Congress has authority under Section 5 of the 14th Amendment to establish clear, comprehensible, consistent, and fair limits applicable to everybody.

On the question of reopening, the reopening, of course, would be possible

for any district under an order that goes beyond whatever these fair uniform limits eventually are established to be by congressional language.

It would be done only on motion of the school board.

It would mean they would have to keep reopening.

They could say that rather than have...

bus routes to be drawn, or school and town zones to be drawn, they'd rather have the situation as it is, but they could in order to achieve uniformity, and the answer to the southerners would say, well, you're bringing the situation as it applies to the north and the moratorium, and we have to live with everything that has been done up to now.

The answer to that is...

There can obviously be no readjustment of actions in the South until the Congress has established substantive limits on busing.

And you can't do that until you have enacted the permanent legislation.

And the freeze is applied to everybody until the Congress has the chance to do that and goes off as soon as the legislation comes into effect.

On the final point, desegregation,

We are seeking the Emergency School Aid Act as the vehicle for the provision of compensatory education in combination with Title I.

There will still be money to assist the general problems arising out of the desegregation process, which before was...

as identified as reasons for seeking this legislation in the first place, and in the allocation of funds for compensatory education and these other purposes.

A priority would still go to communities that are coping with the problems of carrying out desegregation plans, whether legally required or voluntarily undertaken.

That's it, Mr. Secretary.

I think I know our committee pretty well at this point, and it is my guess that if they buy a compensatory education at all, they'll come up with a Mondale bill, not the president's bill.

They'll come up with a compensatory education which will add an additional two and a half to five billion dollars on the president's programs.

My guess is that if it comes out that way, it will also probably pass the Senate.

So I think from a budget point of view, and a political point of view, we've got to take a look at that.

Because if the president's put it over a decision where he has to beat the old bill, which has the face of parents being similar to his, it's going to be a very difficult situation.

Mr. Secretary, could I supplement what Peter has said?

I'm fearful in the House, based on what I've heard and what I've read, that the House Committee, unless there was a change based on your testimony yesterday, that they'll do almost exactly the same.

They're talking in terms of a $5 billion package of Title I.

and then throw in a lot of these other extra things, libraries, et cetera, et cetera.

And it'll be in a package, and it'll be a combination of Senate bill and House bill of education.

We'll have the superficial appearance of carrying out what you recommended.

At the same time, just add tremendous amounts of money that won't have any focus in

...efforts to do what you're trying to do in this particular area.

This is a real danger, and unless you undercut them yesterday, I know this is what the real pro-education people were talking about in the House.

Jerry, what you're saying is that if the concept survives, there'll be a big price tag on it.

That's the way it looks to me, too, I believe.

I think that's a good summary of a few.

And one other observation, Clark and I met with some of the people that are on the conference on higher ed and emergency school aid.

I think they're going to make an honest effort to try and come up in a conference report with something that will state the proceedings, or the moratorium,

Now, this is one of a difficult situation parliamentary-wise, but what I have to say about it is they will take the Bloomfield Amendment, which saves proceedings, but doesn't really go to the guts of what you need

Out of the Committee on the Judiciary, I would like to have Dick Paul comment on that.

The Brookfield Amendment is the state of the proceedings now in process.

It doesn't offer any hope for the right of reopening.

And that can only come from your committee.

So, your committee is holding hearings on April 11th as well, on the president's proposal.

But I'm concerned that...

Those will be perfunctory claims and won't result in legislation, so we'll end up with what the conference does, and that will be half a loaf on the course side of the proposition.

I have no question that Jerry has taken the prospect to matter.

The chairman needs to erect a facade, and he will announce that he will hear the president's proposals in conjunction with our continuing hearings on the prostitute's defense, and we should be invited to testify to that question.

But knowing the staff and the organization of the staff, I can tell you that they do not need to move.

These are the more tormented parts.

Parts item two of the substance is big.

May I digress just a moment, please?

One comment and one suggestion.

I noticed that the Secretary in catching the Constitutional credit for the legislation omitted any reference to Article 3 in the Constitution.

I've been attempting to...

You wrote chapter 5 of the 14th Amendment and Article 3.

Did you omit it purposely?

Have you abandoned that basis?

No, that is really only purely an expression.

You have a pretty good memorandum written by Professor Bork and Professor Wright.

That leads me to my next point, and this is probably a suggestion.

That Constitution is an accident, and it's a far-fetched joke.

And I think it could be entirely improved when you stand upon this tactical impact.

If it dealt with the Constitution, the power to reopen a court decree, there is no question but that a court decree can be made.

And yet, and there is ample controversy for that proposition.

Again, I suggest in Harry's senator case,

In that case, you apply the law as it is today.

In that case, the law changed between the time the trial court had entered its opinion and the time the indictment court had ruled on the facts.

And that's wrong.

And we need to undergird that power, and we're going to sell this package to the southern contingent in Congress.

Now, one final point, if I may, about the study of contingent requirements.

They're not really impressed, I think, with the clause entitled to which permits decrees to be reopened.

Because, they say, that power to reopen applies only in cases involving de facto segregation.

And that the decrees that are now pending, those that have been entered,

I've been asked what was the applicability of the reopening proceedings.

And I've said that it hasn't been possible to reach a determination in detail of this, and of course you need to know the ultimate limitations of the act will eventually be.

But I've said that a rough estimate of the outside number of affected districts is the number in which as a result of proceedings, private litigation or justice or H.E.W.

action,

There have been entered orders since swan, and this was a total of about 95 to 100 districts.

The actual number would seem to be less than this, for various reasons, including a conclusion that aggregate busing had not actually been increased, and so on.

I don't know where the idea could have arisen.

I think that's part of the front part of the road.

That hasn't come up, has it?

No, it didn't.

And if you'll look at the second section preceding the section which authorized the reopening, I can't recall, I think the reopening section 502.

Okay, well, after I look at that, I'd be glad to hear this.

There, this is a question of jurisdiction to reopen.

We've simply said that in all these cases, the court has retained jurisdiction.

Outstanding orders are in effect.

The opportunity to reopen would have existed anyway if there were grounds for reopening.

But the legislative jurisdiction would be to establish grounds for reopening because it would establish...

Uniform rules that anybody could take could be uniformly absurd.

I think we ought to remember on the Senate side, I don't have a peace reaction to this, that when the Constituent Bill is referred, it would go, of course, to up and coming welfare, but there is a movement on which I'm supportive.

We sent a russ grant to have a joint reference, or a subsequent reference, in this case, to the Judiciary Committee.

I think Pete will agree that his committee is going to have an entirely different attitude toward this bill from the majority of the Judiciary, and therefore this is really what both committees ought to have a chance to look at.

Absolutely, the...

The fact, however, I think will not be very terribly different from the point I made before, which is the funding of this thing will be presumably under the Labor and Public Welfare, but this deals with the education.

This area, I presume, will be taking care of the reopening cases, the rules for gravities and so forth, busses and so on, and things of that kind.

So I wouldn't technically be dealing with the authorization for the money he spent.

Mr. President, getting back to the legislative situation, as I understand it, the crucial battle will be to get this program adopted under the Equal Educational Opportunity Act, taken out of Title I of ESEA, because of the effect which you've stated here, a random era of, which would be necessary, if you've got 800 or 700 some million dollars for education,

Right, children, out of Title I, because of the formulas, I understand at least, you would have to appropriate $7 billion in order to derive that much for that purpose.

And that, of course, is a beautiful vehicle for the people who want to unbalance the budget and get more... Full funding people.

Full funding people would just love this.

So, isn't it a fair statement to say that the battle which must be won legislatively is to get it out of Title I and into another act?

Well, of course, three pieces would propose to use...

Title I money, anyway, so far as it goes to schools where 30% or more poor children are, we figure about $430 million out of the total billion and a half.

Title I money is going to those schools now.

And we would supplement that under the emergency school aid money, under the bill now in cost, for which we have already sought appropriation.

The problem is, because this is a period where we're fighting among many fronts, sort of like a

having a bunch of pooping Indians circling around and around the camp, and you never know what side the next attack has to be repelled from.

And there are the people who want more money and less money, and this act and that act.

It's very hard really to figure out all the possible consequences.

But from the point of view of the administration, as good a result as any would be

The Labour Public Welfare Committee and the Education and Labour Committee both adhere to the position that there is existing authority to deal with compensatory education under Title 1, and you don't need to do legislation for that.

Meanwhile, it's not very easy to get out of the emergency school, ladies and gentlemen.

We have the appropriation request for this, and we go forward, whether or not with any amendment to it, to combine these amounts for compensatory education.

Then, we would have to seek, via the judiciary committees, to get the moratorium and the limitations, so that, really, we don't have to have any labor public welfare, education, labor, new legislation,

It would be useful to have the broadening of the Registry-Lade bill to include districts where there are poor children, but where the problem is not the problem of racial isolation.

This is what we've said from the seat.

Well, then aren't you likely to get legislation in this sense, whether it's water or not?

I don't know.

They went out on one side of the mountain.

They said we don't need any legislation.

The way you hear from this was the constant refraining sent aside.

And this is because Kirk and Sue in the house died.

You know, we just want to get two and a half billion dollars more for the entire world.

Whether out of judiciary or by attachment to the Congress.

I wouldn't make any sort of explanation that you just made in the hearing of any of those people because they're likely to interpret what you just said just in that vein.

No, what I said though, Dickie, is that

We don't have to have action on by education and labor.

We can get Title II from the judiciary.

I don't think you can get... Well, it may take some fallback and re-looting, because I don't think you're going to get...

I think it would be very difficult to expect that the History of Slavery Committee as president comes to lead it.

I agree with you that we don't want to do that.

But I don't think anything we've said or anything we've done would support the idea.

I was simply addressing the point that

The Education, Labor and Public Welfare Committees may not take the course of reporting out a new money bill on top of existing authority.

I ask the majority that they take the position that they have authority already.

In the second bill, it referred to the Committee on Education and Labor, and we tried to...

Divide it up and get a part of it sent over to the judiciary, and Lou Dexter refuses to make such a reference.

In that bill, do we have the necessary authorities in Title I, as you're speaking, plus these other, is Section 406 in that?

I think it is.

No, it's not, too.

It is.

If you could get the...

If you have Title I and the emergency school aid together, then the vital remaining convenience would be the moratorium and the limitation provision on busing.

Title II.

The problem is how to get...

We have had...

from the Department of Justice and from the Domestic Council, as Congressman Paul has indicated, some legal breaks, one by former Solicitor General Archibald Cox, and it developed...

and by Wexler and one that Congressman Paul referred to specifically that needs to be explained.

Congressman Paul and I talked on the telephone yesterday about the need to develop and reshape that principal piece.

Last Saturday, copies of each of these were sent to all Republicans on education and labor, labor and public welfare and judiciary as well as

We will work together with Congressman Paul and such staff members on how to do that are favorable to this point of view and to your program.

Let's talk about what can be done this year.

Is there any chance that a constitutional amendment could get a 230 majority in this session of the United States Senate?

Well, sir, I think we pretty well ran that around today.

We've got another senator, Senator Hogan, who needs a constitutional amendment to the very majority of United States Senators.

Yes, we're talking.

Do you think so, Bob?

No.

So, talking about the Congress in Montana, which I know is a way to do a complete night, this is the best case you can put it.

I'm talking about if I were a House member, you know what I'm saying, about the Congress in Montana.

But if you're ever put to us and say you think that's going to do anything about busing, you've got to say no.

Not this year, not next year, not probably for two or three years.

So where does that leave us?

At least it's the legislative group.

It's a rocky road because of our condition.

Now, as I understand it, you do not believe, you say that at the present time, there is no chance that the Judiciary Committee would have a moratorium this year.

Is that what you're saying?

In other words, we've got to go the route of paying the blackmail to the education.

And I qualify that only to this extent, Mr. President.

If the membership of the House becomes convinced and challenged

I don't think the Judiciary Committee, but the Senate itself, the moratorium has issued

I would be inclined to think, yes, we've worked the terms out as judges have given us the key to it in the last meeting.

But you're talking now about hanging it on, the kind of clothes that Congress wears.

Well, the President does, but I think we can hang it on.

Now wait, that means the price tag again, is that right, Peter?

That's correct.

We can hang it on a conference, you're talking about a $5 billion...

No, but now, I want to clarify this moment.

What is in conference is the emergency school aid bill, and this can't be compromised.

What else?

You could take the comments, the present comments, which does not involve a hearing problem, and put a screen moratorium on that, and that could be worked out as the best device.

Yes, because the problem that you have is getting the balance right.

At this point, particularly the power to reopen, that power to reopen cannot be attained through one of two devices.

The best way to do it, the better way to do it,

Frankly, it's true, judiciary.

But you're saying, well, did you get judiciary?

Well, I'm confident we did.

I think our judiciary committee would probably do something with a substantive bill, but I don't think the labor committee would.

Yeah.

Mr. President, my concern is whether or not the conference on this higher education bill can actually agree on a moratorium that's proposed by the president.

I don't think there's anything we can do to the Senate bill or the House bill that goes that far.

It only talks in terms of staying appealed.

It doesn't affect...

I don't think so.

I don't think you're going to get a moratorium.

The reason, Bob, the reason that I thought you could do it is because you see that when he was sitting here

They can go, if they need to, they can go back to rules.

It's what they've done in Secretary Group 1's order.

But I think it's still, if you look at the part of the House Committee members, that they can do this without Secretary Group 1's order, because the Brookfield Amendment...

Well, as Bob said, it doesn't apply to a court order, all court orders, but only to situations under appeal.

At the same time, it's permanent.

And so that they could argue that A,

You can achieve the effect of a stay in every situation by appealing.

And if the school board or the other defendant against the order doesn't like the order, presumably they will appeal.

So that in substance it doesn't have that much of a difference.

In fact, it is permanent.

And so you can compromise, in effect, between a permanent piece of legislation...

taking a stay applicable to oral appeals, by substituting temporary moratorium applicable to oral audits, to be some sort of argument like that.

This is possible, it doesn't.

And I think there seems to be a fair amount of indications that part of the country, you would know better, but the indications I get are that they will try.

As far as I can say, I'm down for a candidate if we try to do this, and if we're successful in Congress against their rejection, I think we're over the top.

On the ground, just beyond the scope of Congress.

So I think we'll have a fighting step, son.

I don't think we're able to vote.

I could be decided when I vote, son.

I don't think we're able to vote.

I'm not sure which way to go, that might work.

Even if you get this result in the cut, you end up in half the load.

of what you actually propose, Mr. President.

This is where I think the political ramifications necessitate further discussion and ingenuity in how we can get something out of the Education and Labor Committee and out of the Committee of the Judiciary.

We're going to end up with something that protects us, basically, although there are some exceptions, nor still results in discrimination against us.

That's just about the way it is.

I don't think that's good politically.

Mr. President,

Let's assume that the strategy of fixing it at a right conference succeeds.

You haven't won yet.

I doubt that the arresting ticket will give you the votes necessary to report a rule waiving force of order.

I think the Congress has done so.

You could not get any rules.

It would be subject to a form of order on the court, raised by any government.

Well, the first question is, what is the exception to the point of order?

How big is the point of order?

The first question is, what is the exception to the point of order?

Most seem to think it moves after the truth.

I agree on that.

I don't know why you think that the rule of one sort wouldn't succeed, because the only question involved would be whether or not you agreed with the proposition.

If you agreed with the proposition, you would vote for the rule of one sort.

Well, John has hit the head point much more than I have.

I think that's my goal, and I'm grateful for that.

I don't think it would have that much difficulty.

I think we could even, sometimes we could take the bill away from the scholars committee.

There's an answer right there.

We've got enough commerce, we've got enough help, we've got enough weight, so I think we might be able to get the votes to take it away.

I think that's the only way we're going to get the lead on it.

We've got to build up the groundswell now where the judiciary is sitting and procrastinating so that we can make the same arguments we made on the duck strike bill that action is needed and you can't tolerate

The cut and a half part back to education and labor.

I don't know how we can change that, but of course the rules today, the rule on that is putting the facts together.

He did the black box, of course, and put the busking thing behind.

He was planning on trying to take the gun from that one away, and by the way, it was the resolution pending before he was going to take it away from the commissioner.

So he had to do too many things.

He wanted to put that aside, which he graciously did.

But he could get a good fight against General Wade, and he could give us all a good fight to get a rule on him.

And he's not running against it.

I think he's going to get his voice on some of these matters.

He's going to wrestle it this term, just as a courtesy to him on a few of these stuff.

That's just my guess.

Thank you.

We have to face reality.

I well understand all of this issue.

We'll have to persist in the constitutional amendment.

I think, however, in terms of facing what can be done now, we all realize we have to try to understand the truth.

And that's why we came down on this side at the present time.

Now, it may be the point that Jake makes, and Jerry backs up, that the moratorium on...

Stopping future busing orders is going to affect the whole country.

For example, rather than having a state like Texas, we'll have a few others.

Tennessee and Tennessee and other states where there are cases coming up with a moratorium.

Second point is that they should fix it.

If we can get the moratorium alone, we ought to try to get, if we can get, we should try to get, of course, both, but this is just better than nothing.

The second point is that one thing we do have is the intervention.

We've already begun that, and we just happen to think Michigan is one of the first states in which to intervene, and there will be others.

Christian will be one night, so let's hope for Christian.

I've seen it in a few other states, but the intervention will have its effect too.

That's helpful.

Now with regard to the legislation itself, the best of both worlds, the judiciary rules, you don't get it all.

As far as compensatory education is concerned,

We do know that the present approach is inadequate.

It's a scattergun, shotgun approach, and it has not proven itself.

We believe that there is strong evidence to indicate that the critical mass approach, where $300 per pupil or more, is zero in the end.

might do have some effect.

It is not conclusive, but there is more of an indication that it might have an effect.

There is an indication that it might not, and you have to try something.

So, for that reason, we have gone along that line.

But on the other hand, since it is experimental,

The idea of coughing up five to ten billion dollars for something of concern, and throwing the money down a raffle, proves that it doesn't supposedly find that putting a thousand dollars extra per child has no effect on black children in the ghetto.

That would be another horrible...

great society kind of program we would be funding before we knew this was going to work.

In other words, two and a half billion dollars in consummation.

That's what we, in effect, are asking.

Two and a half billion for four years.

That's in effect what we're asking.

The other point I would make, however, is that there isn't any question today but that our southern friends are totally in error and this is their fault.

They're arrogant, assuming that the reopening provision

of the legislation applied only to de facto cases and not to deterring cases.

It applies to all cases.

I understand the whole thing.

I know this is the case.

There will have to be a meeting set up with the southern congressmen and senators in which that has to be, in which they can be around at this table and that must be laid out on constitutional problems and everything will have to be done so that they clearly understand all cases can't be real.

In other words,

which ordered busing going beyond the standards set in the new legislation and being re-opened, period.

That's what it means.

And I think if they understand that, that will be helpful.

But if I can go back.

First, the constitutional amendment is a good talking point, but from a realistic standpoint, let's face it, it isn't going to do anything about it.

So if you want to do something about it, we have to pour the coal on in terms of getting that moratorium first.

That has to be, and that will serve...

This is the best of both worlds, but if we consider to be accepting nothing to be wrong, we ought to stop at any place that we can, or then stop at any place that we can't.

Third, let's go down the road the other way.

Mr. President, this is one other aspect of the constitutional amendment, which is not really something we want to talk about, but...

Forteen states can block constitutional amendments.

If the Senate's Eastman point of view is against that constitutional amendment, there won't be the fourteen states.

If the Janet Swandell point of view is against it, there won't be fourteen additional states.

So you are, in my opinion, going to get three-fourths of the states, unless the amendment is partially acceptable to each of those two different groups.

That's right.

In other words, apart from the Senate, but it seems to me that the Constitutional Amendment is clearly, you've got a pretty clear signal from the vote you've had on the Scott-Mansfield.

Yes, and the reason I think the Congress can do anything to define the rules is... On the moratorium.

On the moratorium.

That does not say...

There are people on Bob's side, there are people on the Scott-Mansfield side, and there are people all the way over on the Jarvis-Mondale side who...

Some of them we can get to approve a conference.

I didn't even get to vote on one of them.

Let's just close the call by saying that there isn't any good answer here.

Basically, it's a loser.

We have one side with other people that we don't manage.

On one side we can go far enough, on the other side we can go too far.

We all want to make better.

What we were trying to do was to find an answer that would be effective now.

And in many cases, we possibly could attack by being infected, something that we could get through.

We've offered that, and I think you can count the situation that the folks you'll find in that case.

The second point I would make, and I want to say one word more about the moratorium,

The moratorium has a flaw in it, because it does not adequately set up the single standard for North and South, something that I think is very important.

It is right, for example, that in the South, that approximately 40% of all black children go to majority white schools, and in the North, 25% of all black children go to majority white schools.

So that gives the lie to the Democrats all over the city.

or Virginia, or all the rest.

I mean, they'd be looking at their own state rather than down south.

The problem is mainly a northern problem now, rather than a southern problem, despite all the sanctimonious talk that you hear.

The point is, too, that nevertheless, looking at bustling and stuff, looking at the effect it has, I'm just reading this part of the situation in Buffalo, and that town is torn apart.

...part by the possibility of a busing order.

You, Bob, you, Griffin, Jerry Ford, told me about the... ...and it tears apart...

Now, the responsible, and I know the people in this room, they're as great as what we're going to do.

You may differ somewhat from us.

The responsible man to do now is not going to have between now and this election if we can avoid busting orders by the store all over this country to prepare community after community in part to the extent that we can stop this poisonous thing that does stop it.

Because, let me say, you've got a lot of political judges around this country.

A lot of judges, you've got one jackass up there near stage, you know, who's going to go along with the Justice Department.

Now why?

They know what they're doing.

That Richmond judge, you know, he was doing that for political purposes.

They know it's going to embarrass the administration.

They know that as far as the average person is concerned, he doesn't think, well, who do these judges know that was appointed by Kennedy or Johnson?

It's us.

It's all ours.

So I can't emphasize too strongly that we've got to get that moratorium.

And get it first because it's right, and second because we've got to stop having these orders come down.

And it will be, let me say too, the passage of that moratorium.

This is something that we have to talk greatly about.

But it will, as an expression of opinion by the Congress,

have a very subtle effect of out-questioning, maybe not too subtle of that, on future decisions by courts across this country.

judges follow them, just get up there and read the constitution, and sit up and say, well, the constitution says this and that, whatever I believe I can do.

The judges are political.

That's the way they are.

They're cute, but I can't name them, too.

All right, well, that's enough.

We'll go on to the next.

Mr. President, the appropriation process, quite well, as you know, votes are...

The Senate and House Appropriations Committees indicated to you at the opening of the year that they were going to endeavor to move all the appropriations bills by the 4th of July.

That schedule on the movement of the appropriations committees is being adhered to, and that's a very bright spot in terms of the movement.

And I can say one other thing.

We're not going to talk about the politics of this thing.

There is politics.

Which you would have to think of.

We haven't really made the best of it.

I understand that.

On the other hand, let me say that if you can get the moratorium up, and get house measures...

And those Senate members that have come up, including the presidential candidates, should vote against it.

That's fine.

They just have it out cold turkey there, even though it's inadequate.

But up or down, let them decide how they're going to vote on this thing.

Because then, the vote will be more against bussing.

So don't understand that I'm on your side.

I don't like this double standard stuff that I see north and south, and we're trying to change it, and our legislation does try to change it.

But we've got to get across to your southern colleagues the fact that we're getting at it.

Let's get as much as we can, as quick as we can, start at the moratorium, and then try to get the truth, the technique, the actual truth,

President, that winds up our review of the legislation.

I would hope that the members do go to their various states and districts, and we would develop some grounds for support for the proposals that you've discussed, and we've discussed here this morning, as well as revenue sharing and welfare reform.

These are key, and I see them as real possibilities this year.

It includes the legislative party law and the schedule.

I would simply hold one other line.

It's very difficult for the incumbent members of the House to take.

You might start thinking about the Congress is not going out for 12 days.

Thank you very much.

Now that the Senate and House are going out, we have approximately 11 weeks before the Democratic Convention, but only 9 weeks before the Democratic platform begins to meet in Miami.

And that first is supposed to be 5 weeks or so between the two conventions on the Congress and the Senate.

But at the present time, it appears to me quite likely that this will be the Congress which probably in all the election years in history talked more and did less than any Congress in history.

And I think it's about time that some of that groundwork be laid because they're yakking and they're investigating all the things which go on.

I understand that the...

I have serious doubts on most of those things at the moment.

As to what you're going to get out of the Congress, you've got to try.

You've got the appropriations, of course.

In terms of the programs, the administration programs we have, it seems to me quite clear that the

The present tactic for demonstrating leadership, assuming they have tactics, and maybe they're just going that way, that perhaps is out of control, perhaps Albert Voss can't control it, Mike can't control it, you know what I mean, it's too early to talk about it.

But the dead result is that by the time we get to our convention and into the campaign,

We may have to look at the record of the Democratic Congress stand for it on, with regard to what it can do, as far as what we got.

Of course, there's some things that we may have had, but have this in mind, if you will, because that foundation must be laid down.

I think, Mr. President, it's very amusing that, on the Democratic side, they do a possible rump session with more horror than we do, with a lot of reasons not to want a rump session.

Those are things that people want.

And if this Congress doesn't produce, those are very legitimate issues all over the country.

And if we talk about us trying to help get these through, show cooperation,

I hope we pass them.

If we do, we can all take credit.

If they don't, we've got the political betterment.

Jerry, do you?

Yes, please.

I'm not sure I hope we pass, but I think from a political standpoint, you're correct.

I don't think any of these issues are going to reelect the president, but we pass them.

If we pass them, I think if we don't pass them, we've got a much better opportunity to condemn all the Democrats.

I think we've got to keep all the Senate presidential candidates beating the fire.

Now, on busing and everything else, I think we have to do really, to see where we're at in the Wisconsin primary.

Well, let me say that I actually can't make the decision on what he was referring to in the rump session, but he well remembers as Celeste...

the fact that he rubs such a drone called Lee, Pauline, and so on, that was a stupid thing.

It was very smart.

It's very, very good.

And Jerry, I know all of you, Bob Wilson, the rest of the AOC, all of us in the company, you know, we're not going to be out there.

Remember, they got more than we did.

So, it's very much in the interest of the party that is in the minority in the House at this time to have

They're members tied down here campaigning.

I mean, in the Congress.

That is the other.

So we just have that in mind, too, in case we can't make that critical decision.

Is that me, Bob?

Bob!

I'm going to miss the rest of us.

Thanks.

And we ought to answer, ought to answer calls for tax reform, saying here's one right available to you.

Sure.

Now, that we've been pushing on.

President, we've got Herbst and...

Right, that's George Schultz.

If you would tell us, talk to us about the economy at that time, we've got a wide, we've got a preparatory meeting, we've got to get some counsel on that, taking them on, passing on Congress.

Mm-hmm.

Mr. President, ladies and gentlemen, I found the Advertising Council much more docile yesterday in listening to our story about the economy than they have been in previous years.

I think there are two points to make.

The first is that since August 15th of last year, we have been conducting the most forceful, comprehensive, open-minded, and determined work

...programmed by a government to solve the economic problems of the country that any government has ever carried on.

I elaborated on this in a speech which Barbara Conable has done enough to put in the congressional record, and I will not say more about it, except that it is a historically quite valid statement, and I say if you want to get some good material about the economic side, it's an excellent speech by Barbara Conable, and it's an excellent speech that I want to make with this viewer.

And I was certain.

Good forest analogies.

That's right.

And the most respect in this forest program was the very determined and smooth transition that was made last week from phase two to phase two minus four.

Now the second point just to tell you about our program is that it's working.

At the beginning of the year, our forecast of the economy can be summarized in three numbers.

We forecast a $100 billion increase in the GDP.

We forecast that the unemployment rate at the end of the year will get down to the neighborhood of 5%.

And we forecast that the inflation rate at the end of the year will not exceed 2-3%.

I would say that our confidence in these forecasts is not greater than when we first made them, and some of the most respected forecasters in the private sector are now exceeding, and have now revised their forecasts and are exceeding ours.

There's a long list of things that I would go through very quickly to support our growing confidence.

We have had two months, January and February, of really extraordinary new housing records of housing starts.

This has been partly supported by the behavior of interest rates.

Since the new program was launched in August, mortgage rates have come down by about half of one point, half a percent point.

And they are still declining.

Since the first of the year, business plans for flash equipment expenditures have increased to the point where they now forecast an increase of expenditures of 10.5% from 1971 to 1972, whereas the actual increase from 1970 to 1971 was 1.9%.

In January and February, we had an extraordinarily high new orders in place for flash equipment expenditures.

Retest fails that had been lagging show signs of picking up in March, and two major indexes of consumer confidence, the Settlinger Index and the University of Michigan Survey, have risen very sharply in recent months, and now show consumer confidence at the highest level since the spring of 1969.

From December to February,

The unemployment rate declined from 6% to 5.7%, which is a faster rate decline than we expected for the year as a whole.

There was some tendency by Mr. O'Brien and others to belittle this number because it was seasonally adjusted, and I suggested that if you would like to agree from now on to use all these unadjusted figures, we might go along with that, because in August, September, October, and November, the unadjusted figures will be lower, for unemployment will be lower than the adjusted figures.

However, we do live basically in a seasonally adjusted world, and that's the reason.

Now, with respect to inflation, we've had a good deal of talk in the last week particularly, and a number of statements to the effect that the inflation problem is not being handled by the new program.

Probably the simplest number to look at is that in the six months since the new program started,

The consumer price index rose at an annual rate of 3.3%, whereas in the six months before the program, the index rose at an annual rate of 4.1%.

If you look at commodities other than food, and I'll talk about food in a moment, the increase in the six months since the new program started was at an annual rate of 9-10-1%, whereas it had been at an annual rate of 3-9% the six months before the freeze started.

Mr. Buchwald had some fun with me this morning for saying that we could look at the consumer price index excluding food.

I think that's a top in private growth between the fourth and fifth course of his lunch at San Francisco.

Now, with respect to inflation, we've had a good deal of talk in the last week particularly, and a number of statements to the effect that the inflation problem is not being handled by the new program.

Probably the simplest number to look at is that in the six months since the new program started, the consumer price index rose at an annual rate of 3.3%.

For the new program, the...

...4.1%.

If you look at commodities other than food, and I'll talk about food in a moment, the increase of the 6 months since the new program started was at an annual rate of 9.1%, whereas it had been at an annual rate of 3.7% the 6 months before the freeze started.

Mr. Buchwald had some fun with me this morning for saying that we could look at the consumer price index excluding food.

I think that's a call that probably grows between the 4th and 5th course of his lunch at San Susi.

But in any case, the reason for saying that we can look at the numbers excluding food is that food does follow a pattern of its own.

It has a life of its own.

It's very volatile.

The prices are very volatile, as you all know, and we have reason to think that...

The price of food will not rise nearly so rapidly in the rest of the year, prices of hogs have been coming down, and wholesale prices of soy steers have been coming down, and this points to a leveling out of seed prices in stores in the future.

We have some recent evidence in February and March of a watch of

of retail margins for meat, and Secretary Connolly has invited 12 of the leading chain stores to meet with him in his office tomorrow afternoon for a little talk on that subject.

Some people, including Senator Humphrey, have made a big point of the fact that the rate of increase of meat

The consumer price index in the three months after the freeze was 4.9% annual rate, and the colds have got the same rate, evidently unfair to the volatile prices, and was largely due to the food price increase.

But also, as we had forecast, there was a considerable bulge in wages, and in those same three months when the

Well, there are really two important measures of the significance of the program for working people.

One is that in the six months since the program started, real weekly earnings, real, that is real, adjusted for cost of living,

After tax rose at an annual rate of 5.6%, whereas in the previous six months they rose at an annual rate of only 1.2%.

And probably even more important, this program has for one of its main objectives, enabling us to push the economy up more rapidly by expansion.

And to increase employment.

And since the program started from August to February, we've got the latest figures we have, total employment increased by 1.1 million.

So for those workers, this program has been great.

And we haven't had a very reduced number unemployed by about 200, but they're confident we will continue to reduce the unemployment rate.

So I think we have a very strong story.

It's a story that's a little hard to get through the media curtains, but let's keep it coming.

What was that...

Real weekly wage figures the six months before are 1.2%.

I'm going to change the description.

Well, I have some figures which are about three days out of date.

I was going to send them to Forty to ask for a fact sheet set that would be up to date for today.

I do have a handout which does include the latest CPI.

I also have copies of a little thing.

A summary that I wrote a couple weeks ago, a shorter version of which appeared in the New York Times, where they left out my final sentence, that we must not allow the frustrations of many years to enslave us to a new law, which might be called O'Brien's Law, that no good news is possible.

Laughter

Mr. President, I think we make a mistake by talking about the manual.

since August has gone up 1.4%.

And our economic arguments ought to be based on August always, because that's when the program began.

And if you say that the cost of living since the beginning of this program has gone up 1.4%, it has a lot of impact on people.

Humphrey was saying the other day on television that

He's got 5% since then.

What are you talking about?

It's an annualized rate.

The annualized rate isn't even that high, but... Well, I think we need to pick up on it.

The part that I did, I was curious.

George, you've always done a couple of practices.

The real wage is gone.

That is, the increase in real wages.

We had a period of about 0.67, 0.71, where all wages increased.

There was no real increase in wages.

It's very dynamic as well.

It's independent.

I mean, if you ask the distributional power system, overall, you can generally make that statement that there's hardly any or no increase in real wages.

But,

The incidental thing about the last six months, there's been a real increase in real wages.

Right, George?

Yes, sir.

A long period of very little change has broken out now for the first time.

Talk about the back of the heart.

We've got these wonderful wage increases.

67, 68.

But it was no real increase in wages, because price increases they've done.

Now we have finally stopped that.

And looking at the 3 million wage earners, and since the August 15th vote, we've had a very substantial increase in real wages.

Is that correct?

President, I thought for the first time that we will get that one page.

That's very important.

And also, the Republican Senate.

The Republican Senate.

Yeah, they're going to be studying it.

Yeah, we'll be studying it tonight.

We'll have time to get it out.

This would be a... Yeah, something where you just get those numbers.

I use it for...

I have a few of those.

I have them right off there.

And I suggest one line, which I think is very important to take, with regard to food prices.

You can't get into the business of defending high food prices.

You can't get into the business also of, on the other side of the coin, of saying, well, it's because the farmer is essential.

The line, which is very simple, is that only a third of the cost is basically...

But the housewife takes him to the supermarket or the grocery store or goes to the farmer.

And so it is not that third that really causes a rise in food prices.

It's the two thirds.

Farm income was too low.

Good.

But the real culprits here are not the farmers.

The farmers should be made to see.

The culprits are the middlemen and the retailers.

Not him.

Oh, you say some of them are out there too.

That's all right.

They deserve it.

Because their profit margins have gone up.

That's why Connolly's having a meeting.

He's inviting them.

But the invitation is to command performance, I think.

Sure.

But I think we've got to be on the side that we don't like high food prices.

We're against them, but we're going after them too.

But obviously we can't control barn prices for reasons that they're so subject to fluctuation.

Don't put us in a position where we're just offending the high food prices.

George, I want to say that I'll also have to wait for it, and it's going to work out.

When does the next unemployment figure come?

I think the main thing is, as the president said in his statement, running the plane is everybody's job.

George B. walked off the job, and not very many people walked off with him.

He took his head belt, and I hope that Christian Leonard would cock off with it.

Some of the presidential candidates walked off, particularly Hubert Humphrey.

But the team is going to stay on the board.

The construction union, members of the construction industry section of the committee, and the overwhelming response around the country in terms of editorials or policies or one thing or another of that sort, is in support of making the program work.

Now, a transition was made.

We had considered the possibility all along that the labor people might walk off the board, so it was not as though it was a shocking thing.

A transition was made.

The concept of a tri-part science wage board, which is what we wanted to have, which I think has served a purpose in setting the 5.5% standard and getting some acceptance of that and so forth, was a way of that to an all-public board.

We do have a labor member on the board, Frank Fitzsimmons of the Tangers, and a

without adequate participation by the labor members is just demonstrably wrong on its face when you look at the actions of the board in the first place.

I think most people have had criticisms of the wage stabilization effort.

It's been much too lenient.

But beyond that, just in terms of votes, they've had 54 sort of main decisions they've voted on.

36 times labor has voted in agreement with the majorities.

In 13 of the cases, that's 25%, they voted against.

They abstained four times, split once.

But on five of the eight major issues that were identified, they were on the winning side.

So they have participated, and they have gotten their way, and I think in the eyes of many people, they've gotten their way more often than was a good idea.

The long short case,

West Coast Longshore case was the one that at least provided the occasion for their walk-off.

That was a case where the agreement called for a 20.6% increase in the first year.

The payboard allowed, because of productivity, because of the fact that they had gotten behind the cost of living on a five-year contract, allowed 14.9%, which is miles above

The gentleman said, but this cut it back significantly from the level that they agreed to, and all the later people voted against that.

I might say that we have let it be known that the administration intends to support the payboard's decision, and we haven't heard anything from the West Coast.

We have continued to work on it.

Just what kind of response they'll have remains to be seen, even though our position hasn't been quiet but resolved, and we're here when it needs to be.

Now, I think that one of the interesting things here has to do with the crippling strike tax, and Bob mentioned, well, is it better to have it passed or not passed?

Well, we like to have it passed because it's constructive legislation, but it's very apparent

that one of the principal reasons why there is a strike on the west coast right now is that labor people fear that if they again shut down the coast, if they again shut down the transportation system, that there is going to be a real rock and soft piece of legislation being approached, and they don't want it.

So I think the more the possibility of that act is talked about,

The more nervous they are, and the more unlikely it is that we're going to have a big upset here.

So that act is playing its part, whether it's passed or not, is kind of a stringent and important thing.

Just on the background of the wage stabilization price program,

Of course the cases that you read about are the ones that are big requests for major exceptions of one kind or another.

And the routine work of the price commission and the pay board is little noticed.

So if you ask yourself, of all of the ways change,

That must be reported to the board, pre-notified to the board before they can be approved.

What is a, so to speak, weighted average of the amount?

It comes out to be slightly less than 5%.

So you read about the long term, and you read about aerospace and so forth, but just take the run of the mill,

average it all in, and it's slightly less than 5%.

So that is a significant reduction from the problem that we have been having, and I think it suggests that this process was having an impact, and a constructive impact.

On the price side, in terms of all applicable sales, as you take company proposals, and that's what the Price Commission ruled,

and compare the amount of increase with the total sales of that company.

The price increase is approved down to 1.6%.

So, there is an area of application there.

Herb has covered the consumer's price index.

I wouldn't go over that, but I think the message here is, in terms of the economic stabilization program, that...

It has been a working mechanism.

It has been achieving results.

It has set forward standards in its processing cases.

And we had this challenge of the labor people.

It was met quickly.

And the court has reconstituted its business, its rules and regulations.

Our, in fact, whole thing is proceeding.

One further point.

That is, I think, quite a valid point, and sort of a favorite of mine, which I think is a good thing for us.

We have put this stabilization program into a situation where we had a lot of room for expansion of the economy before you ran into the kind of very tight

Markets that would pull wages and prices up from the demand side.

That being the case, it's possible to have a strong expansion without regenerating demand inflation.

And a strong expansion almost guarantees a strong improvement in productivity.

Now we're having, as Herb said, a strong expansion.

We will have a strong improvement in productivity.

And that, operating against an average wage change of, let's say, 5% or so, we get the productivity change of 4%, the labor cost is in hand.

And just keeping a little damper on this thing,

It's quite possible to have a strong expansion, a strong rise in employment, a decline in unemployment, and more state in crisis through the way this mechanism operates.

So I think we're sitting in a good position.

The mechanism that's put in place seems to be...

operating pretty well, and the price has responded, has responded in part to the control mechanism, it's also responded to the underlying processes that are at work, and which are favoring a successful operation of the program, both in terms of the inflation, and in terms, in many ways, more important, the expansion of the economy.

I think you could say it this way, George, to the...

Controls in deep time will not work if you are going against the tide over any period of time.

Controls in deep time will work if you happen, as we are in the present time, to be going with the tide.

Because if we were in a period when you had a high demand inflation as well as a...

On the other side, no amount of control would be able to just pop up, bust out your all over the place.

Right.

I think that's the reason why we have to keep our eye on things like what John Rose was talking about.

If we wind up having created a situation where a year from now the budget is hopelessly out of control, and we won't have gotten the economy to expand and so forth, we won't be able to contain the inflation and we'll have to go through another very painful experience.

The only way is to keep our heads about us now and not allow things like that bypassing of the appropriations committee to take place.

The controls mechanism will be affected at this period.

But at the later period, the traditional forces and conventional forces of the fiscal policy will have a massive effect.

And in fact, that's the reason the decisions we make now on this fiscal side can have an enormous effect next year, and when all the controls in the world won't be able to stop them.

You are inviting some of these budget items?

Well, we are expanding.

We proposed a budget that has plenty of deficit.

But at the same time, we have to realize that that's built for the times.

And when the expansion goes forward, we get a little bit further along.

Can I suggest one point before we break up with regard to this whole matter?

It's to be on the right side of the issue.

People are never satisfied with the prices that are going to be stored.

Prices are always too high.

It's always hard to keep the budget as long as possible.

The main thing is to be fighting it.

Fighting it, and of course being effective, as some people would like to be also.

But we think this year will be a year when we're effective.

But even where we're effective, it appears we're on the wrong side.

You're dead politically.

We've got to be fighting the rise in the cost of living, whether it's food prices or anything else.

We've also got to be fighting the battle against unemployment, and not...

to sit back and say, well, it's a little better than it was, and so forth.

So that's the position I want to be in.

With regard to the rise in the cost of living, we come back to the confrontation.

Without putting it in personal terms, I think we should realize that there is no necessity for any of you who

You have to go back and actually you have to make an appeal to union members to the extent that you can, and to workers.

Many of them have sympathy with union members, just an empathy, because they are all wage earners in that cut.

There's no reason why you can't be totally on their side, and yet totally against me, because basically the idea that here is a man, a powerful man, but who's out of step with his members,

I'll accept with the country.

I'll accept with what this nation needs.

I think this is a part of the point.

It's the sendlinger who does the economic polling, has indicated that since this last week, it's 75% overall of the people, including the majority of union members, is dying with the president and not with me on this particular matter.

The point that I make is this, that I don't think any of you should be afraid, from a political standpoint, to take on those who have been so irresponsible to, as a matter of fact, walk off the job of fighting inflation.

and take on those candidates who say, we'll walk off, we'll throw up our hands, we won't do it.

Because in this instance, they're out of step with their owners.

People want to come out.

In order for that, however, to sail, you have to knock down the arguments of the Humphreys and others that the program hasn't worked.

It has worked.

Because you compare it to the first six months before, and you see a substantial cut in the rise and loss of living.

And going ahead, we believe that that's going to be the situation in the future.

I think that the nationwide has said, it isn't just making it work, but we have to be on the right side of the issue.

We're fighting it, and the others are obstructing it.

For political reasons, for partisan reasons, for whatever reasons, or for selfish reasons.

And I think certainly on the longshoremen, if you need a scapegoat, there's a lot better scapegoats than the farmers, as far as the longshoremen are concerned.

I think we just gladly say that a 20% wage increase for west coast longshoremen is too much.

The payboard was right, meaning it was wrong.

Correct.

And you've got a very powerful issue there, I think, in terms of audience reactions, you might use it.

Mr. President.

Yes, sir.

I don't know how many plots John Connolly doesn't want us to date, but he made a beautiful statement.

He said, of course, we hate to see Mr. Dean leave the table.

The only meeting he intended was the first one when his own pay increase was up.

He didn't just pull the rug out of the window.

Wouldn't it be possible that one of the reasons food prices are up is because of the wages of the people who work in the processor?

In other words, is the organizer or the partner responsible for this work?

Well, I would imagine they continue to increase particularly.

We have got this to the point where we're ready to talk about it, because it's not quite that solid, but the general...

The impression you get from looking at figures is the margins have grown a little as the volume has grown.

Profits have gone up quite a lot, mostly in the whole middle band area.

And that does give an area to work in.

At the same time, underlying it is the basic raw agricultural product price.

And that has had a rise, but it has...

The rest of it stays the way it is.

Weird.

and it really hurt you in a certain situation, because she was one little common story, because you're talking about chicken farmers, and people about chicken farmers, I guess around John Williamson here, but John was pointing out that he was down in Texas, and he always goes around, he's a skilled politician, and I'm talking to one of my neighbors there, and he said he raised chickens,

Sells eggs.

I says, what do you get for 400 cents?

Well, he says, I sell them above the, and above a dollar.

A dollar?

Or three dozen?

He says, you can get you about 30 cents of that from the accident.

You know, a few days later, she says, Pierre Hotel.

And I ordered two eggs.

You know, no bacon, nothing.

I just wanted two eggs for breakfast.

It just cost me $5.

Because that's $30 a dozen.

He says, not $30 a dozen to the farmer, $30 a dozen to the Pierre Hotel.

That's too much of a difference.

There's a little man in there somewhere.

Thank you.

I agree.

When you go through the agonizing, you get those Bill Timmons, and you get the Bill Timmons at Clark.