Nixon phone call with Shultz on Pay Board and George Meany

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Hello.

Hello, Mr. President.

Hi, George.

Hi.

On the subject of the pay board and what it's doing.

Yeah.

Ben Biagini, who's a member, management member of the board, as you know, called me and we made an appointment to meet as soon as he can after 6 o'clock tonight, which is about when their meeting for the day will be over.

he says that he and his group and management group have worked up a proposition which they're presenting to meanie and the labor members and i suppose the whole board but they're sort of feeling their way with with a proposition i don't know the contents of it and he wants to after having gotten a feel of the labor reaction he wants to tell me about it and

obviously get the administration's view as to whether or not it's acceptable um so i wanted to you to know this because i know you're following this very closely yeah and to see if you have any um particular way in which you think i ought to lean on this that is i can receive the information and say thank you and i'll get back to you um

We, I suppose, have a choice as to whether we're going to act reasonably tough and think the management people should be reasonably tough on the deferred increases and so on, or whether or not we sort of accept the fact that likelihood is that there are going to be these deferred increases and the sooner that gets done and behind us, the better.

I think myself that there will be a big difference between something that comes out of the pay board with the endorsement of those management members because they're a fairly strong group.

And if they agree to something, that's rather different than having, say, the labor people and most of the public members voting for it and the management people saying this is a terrible deal.

But I thought I would impose on your time and just see if you had any particular reactions to this meeting and how you think I might react.

Well, our reactions are limited because we haven't many options.

That's the problem.

Now, it's very easy to say, let's be tough.

And then the question is, what do you do if the toughness doesn't work?

Now, in my view, the

that what our goal should be is to get some kind of agreement on the part of the pay board, if we can, where the management and labor people agree, that doesn't go so totally far in accepting labor's demand that it will be universally

condemned as a cave-in to many.

Now that's really the guideline and you can judge that

probably better than most as to what will be so interpreted.

I would assume the management fellows would have a pretty good idea as to what they think is that.

My own view is that we, within that general framework, can go pretty far.

Mainly because we can huff and puff like Arthur and some of the others do about this damn thing.

Then you put it right to them and they'll say, well, we shouldn't have done that or we shouldn't do that.

I say, what would you do?

And they'd say, well...

Well, we ought to take on Meany.

But then they say, then how do we do it?

And then you remember, like I told you yesterday, what the hell do we do?

Well, it seems to me it's a pretty thin rule if you say that, well, you have a public board, public members, and the public members will put something out.

And then we proceed to take a selected part of the economy and try to enforce it.

And we put people in there and have criminal penalties and so forth.

Jesus, it's going to be universally interpreted.

I mean, let me put it this way.

A settlement with the labor members, even though that settlement will go further than most people will think was wise, is better, in my view, if you look at the hard choices, than failing to get a settlement and then having to go the other direction.

where I don't think there's a, where I think it would be, I realize, popular at the moment, popular in the sense that if we went the other direction, you'd kick labor in the tail and publicly and say, now we call upon everybody else to stand firm.

But then the question is, how do we, what sanctions do we have to back up that decision?

And they are damn few and far between as far as effectively sanctions are concerned.

Would you not agree with that?

Yeah, I agree with that.

That's the way I'd say it.

So my leaning is to try to make a deal if we can.

I must say that I would hope that some formula that would not give them everything during the freeze period.

I know the suggestion that has been made that we let's forget 71 and look at 72.

That generally makes a lot of sense.

I think that's the approach behind these things.

I think that makes a lot of sense.

But I think, George, that...

something during the freeze period.

I mean, if there's any way that it can be worked out, it should be... Well, maybe it just isn't in the cards to work anything out.

Well, we'll see what he has to say.

And if it seems to be at all reasonable, I'll say, all right, let's go ahead with that.

I suppose that you have a problem here.

Now, the other side of the coin is, what if...

what the hell is the attitude of the labor people, whether they're out to bust this thing or they're out to cooperate, I don't know.

Do you have any later reports on that?

No, sir, I don't.

Right.

But I think that if they get reasonable things, they're not anxious to bust it, at least not at this point, I wouldn't think.

We have some cards to play with them in one sense, is that

While I say we have no options, the option from their standpoint isn't all that bright either, because the public reaction will be enormously negative to labor.

And I would proceed, and I intend to make it that way.

If they don't play, I mean, the hell with the political effect.

I'm going to take them on and hard.

Now, that's just got to be understood.

It's going to be a bloody battle, and they will have drawn the sword on, frankly, on the American people, in my opinion.

I'm going to put it right to them.

And then we'll get a hell of a, we'll make them the bogeymen of this thing.

Now, that's our card.

I realize that, as I say, that's,

public relations threat which which will hurt them for a while but which down the road i don't think it's too damn good for for what happens but uh but on the other hand they don't want that i don't think they want to be in the position of being considered to be the selfish people who broke this plan that the american people so strongly supported yeah so that's that's the way i see it okay okay that gives me what i want to know good luck thank you sir

Nixon phone call with Shultz on Pay Board and George Meany

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Nixon Library Finding Aid

Also recorded on November 2, 1971

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