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Conversation: 555-009

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Start Date: 5-Aug-1971 3:23 PM

End Date: 5-Aug-1971 4:35 PM

Participants:

Nixon, Richard M. (President)Romney, George W.Connally, John B.Shultz, George P.Ehrlichman, John D.Flanigan, Peter M.McCracken, Paul W.

Recording Device: Oval Office

Full Tape Conversation Start Time: 02:26:42

Full Tape Conversation End Time: 03:37:56

555a.mp3

555b.mp3

555c.mp3

NARA Description:

On August 5, 1971, President Richard M. Nixon, George W. Romney, John B. Connally, George P. Shultz, John D. Ehrlichman, Peter M. Flanigan, and Paul W. McCracken met in the Oval Office of the White House from 3:23 pm to 4:35 pm. The Oval Office taping system captured this recording, which is known as Conversation 555-009 of the White House Tapes.

Nixon Library Finding Aid:

Conversation No. 555-9

Date: August 5, 1971
Time: 3:23 pm - 4:35 pm
Location: Oval Office

The President met with George W. Romney, John B. Connally, George P. Shultz, John D.
Ehrlichman, Peter M. Flanigan, and Paul W. McCracken.

     Press
             -Forthcoming Time story
                  -Connally quotes
                       -Wilbur D. Mills
                       -President’s interest in economy
                       -Lawrence Malkin
                       -Hedley W. Donovan
                       -Veracity
                  -Malkin
                                        26

                    NIXON PRESIDENTIAL MATERIALS STAFF

                                Tape Subject Log
                                  (rev. 10/06)
                                                                 Conv. No. 555-9 (cont.)


               -Fortune
          -Arthur F. Burns
          -Connally quote
               -Malkin
          -Time
               -Hugh S. Sidey
               -Editors
                     -People's Republic of China (PRC) announcement

Housing
    -Interest rates for mortgages
          -Interagency Meeting
          -Current rate
                -Impact on home builders
                       -Construction
          -Subsidies
          -Raising ceilings
                -Economic and political effect
          -Recommendations of working group
                -Maintain current rate
                       -Housing starts
                             -Government National Mortgage Association [GNMA]
                                   -Extension of assistance
                                          -Cost
                       -Appropriations
                             -Home Loan Bank Board [HLBB]
                             -243 Program
                       -Projected housing starts
                       -Federal Housing Administration [FHA] - Veterans Administration
                             [VA]
                       -Effects
                             -Home builders and buyers
                             -Other interest rates
                             -Consumer Price Index [CPI]
                             -Political reaction
                       -Increase of rates
                             -GNMA authorization
                                   -Discount rate
                             -Home builders view
                             -HLBB and 243 Program
                             -Effects
                           27

         NIXON PRESIDENTIAL MATERIALS STAFF

                    Tape Subject Log
                      (rev. 10/06)
                                                   Conv. No. 555-9 (cont.)


                    -Housing production
                    -Mortgage market
-Housing industry
      -Subsidies
            -Congress
            -Effect of maintaining rate
-Romney’s recommendation
-Prime and other rate
-Timing of possible action
      -Federal National Mortgage Association [FNMA], HLBB
      -Home builders
-Possible impact of increase
      -Amount of increase
      -Other interest rates
-Timing of possible action
-Amount of increase
      -Home builders
-Increase
      -Underwriting
            -Inflation
            -Congress
-Proposals
      -Effect on housing starts
-Effect of increase
      -Decline in starts
            -Relationship to subsidies
                  -HLBB, 243 Program
-Maintain current rate
      -Eugene S. Cowen’s prediction
-Housing construction
-Possible impact of increase
      -Inflation
            -Rate
-Maintain current rate
      -Cost
            -HLBB and 243 Program
-Subsidies
      -Congress
            -Employment
-Stimulating housing starts
      -Relationship to interest rates
                              28

          NIXON PRESIDENTIAL MATERIALS STAFF

                      Tape Subject Log
                        (rev. 10/06)
                                                        Conv. No. 555-9 (cont.)


     -Subsidies
-National Association of Real Estate Boards
           -Recommendation
-Mortgage
-Gene Curtis [?]
-Home builders
     -Economic health
-Recommendation on increase
-Subsidies
     -Bill
           -Employment
     -Stimulus to economy
     -Congress
           -Tax cuts
                  -Reduction of personal exemptions
-Possible actions
     -Political consideration
           -Jobs
     -Psychological impact
           -Timing
     -Impact on bankers
           -Increase in prime rate
                  -International Telephone and Telegraph [ITT] bond rate
-Maintain current rates
-Timing
-Tandem plan
-Legislative action
     -HLBB and 243 Program
-Subsidies
     -Effect on poor
-Timing of action
     -Congressional recess
-Decision
     -Reasoning
-Wage and price settlements
     -Abuse of power
           -Anti-trust
           -Congress
     -Inflation
-Maintain current rates
     -Duration
                                                  29

                             NIXON PRESIDENTIAL MATERIALS STAFF

                                         Tape Subject Log
                                           (rev. 10/06)
                                                                           Conv. No. 555-9 (cont.)


                             -Tandem plan
                             -Legislation
                       -Call to [John A. Stastny]
                             -Housing starts
                  -Discount rate

     President's schedule
          -Forthcoming Time story
                 -Shultz and Connally

Shultz, Connally, Romney, Ehrlichman, Flanigan and McCracken left at 4:16 pm.

     Press
             -Time story
                   -Malkin
                   -Sidey
                   -Negativity
             -Instructions to Shultz
                   -Statement of facts
                         -Effect on administration opponents
                               -Politicians, pollsters, editors
             -Arthur F. Burns
             -Time
                   -Connally quote
                         -Forthcoming meeting with Malkin
                         -Source
                               -Eligio de la Garza
                               -Peter G. Peterson
                                     -Wilbur D. Mills
                               -Donovan
                         -Fred R. Harris
                               -Possible resignation from Senate
                   -Henry A. Kissinger meeting with Sidey
                         -People’s Republic of China [PRC] story
                               -Distortion
                                     -Time-Life editors
                                           -Vietnam war issue
                                                 -President
                                           -Pentagon Papers
                                                 -Democrats
                                                        -John F. Kennedy
                                        30

                    NIXON PRESIDENTIAL MATERIALS STAFF

                                Tape Subject Log
                                  (rev. 10/06)
                                                                  Conv. No. 555-9 (cont.)


                                  -Anger at Administration
                                  -Henry A. Grunwald
                                  -Sidey
                                        -PRC story
                                              -Editing
                                              -Letter to Kissinger
                                  -Editorial position
           -Forthcoming story on economy
                -Instructions to Shultz
                      -Positives of economy
                      -Problems
                            -Inflation and unemployment
                      -President’s involvement in economy
                            -California
                            - Budget
                            -Use of time
                                  -Meeting with Connally
                                  -Foreign policy
                                        -PRC
                                        -Melvin R. Laird
                                        -National Security Council [NSC] meetings
                                  -Budget
     -President’s view

Economy
    -Possible Administration actions
         -Burns
               -Recommendations
                     -Wage and price board
                     -Mandatory controls and enforcement
                           -Steel industry
         -President's instructions to Shultz
               -Economic controls
         -Connally's schedule
               -Texas
               -California
         -Import tax
               -Level
         -Tax cut
               -Personal exemption
         -Investment tax credit
                                   31

                  NIXON PRESIDENTIAL MATERIALS STAFF

                            Tape Subject Log
                              (rev. 10/06)
                                                           Conv. No. 555-9 (cont.)


              -naming
         -Tax cut
              -Symbolism
                    -Budget
         -Revenue sharing
              -Deferring
         -Timing of action
              -Congress
                    -Mills
                         -House Ways and Means Committee
                                -Trip to Brussels
         -Proposed tax action
              -Railroads
              -Jobs
         -Controls
              -Removal
                    -Effect on trade
         -Possible Congressional action
              -Import tax
              -Investment tax credit
              -Controls
              -Tax cuts
                    -Exemptions
                    -Deficit tax credit
                    -Excise tax
                    -Import tax
              -Mills
                    -Credit
              -Russell B. Long
                    -Credit
                    -House Resolution [H R] 1
                         -Quid pro quo
         -Import tax
              -Devaluation of dollar
                    -Japan
              -Imposition and removal
                    -Congress
              -Bargaining chip
                    -Devaluation

Malkin
                                             32

                           NIXON PRESIDENTIAL MATERIALS STAFF

                                       Tape Subject Log
                                         (rev. 10/06)
                                                                     Conv. No. 555-9 (cont.)



Connally and Shultz left at 4:35 pm.