Nixon White House Tapes — Conversation 014-154
Date: Wednesday, November 17, 1971 at 1:27 PM
Participants: Bull, Stephen B.; White House operator; Ehrlichman, John D.; Nixon, Richard M. (President)
Recording device: White House Telephone
Source: https://www.easynixon.org/tapes/014-154

This transcript was generated automatically by AI (WhisperX) and has not been reviewed for accuracy. Do not cite it as authoritative.

[0:00] Thank you.
[0:21] Coming right on, sir.
[0:22] Thank you.
[0:26] Is this the president's line here?
[0:28] Hello?
[0:29] John, Steve Bolt.
[0:30] Can you talk on the telephone to the president?
[0:32] Yeah.
[0:32] Okay, let me ask him to pick up just one moment, please.
[0:44] Hello?
[0:45] Yes, sir.
[0:46] Hi, John.
[0:47] I just need to let you know that we have been trying to help Ogilvy and that the price is just too high.
[0:57] I see.
[0:57] And we're going to have to cut them loose.
[1:00] We've been working very intensively at this with Percy and Ogilvy.
[1:04] Percy wants us to move H.R.
[1:08] 1 back up either 20 or 25 percent closer.
[1:14] In other words, the first year cost of H.R.
[1:18] 1 would be 20 or 25 percent higher.
[1:20] And he wants an administration commitment to support his amendment to H.R.
[1:24] 1 to that effect.
[1:26] It's about a billion dollars as a price of not putting in his amendment to funnel a lot of early money to Illinois as an amendment to the tax bill.
[1:39] You mean he has an amendment to the tax bill?
[1:42] Right, which he's holding over our heads.
[1:45] We've been trying to come up with money for Illinois on the sly, on the side, to keep him from putting this thing in.
[1:53] And we have found as much as Ogilvy said he wanted, but the ante keeps going up every time we get close.
[2:02] We've finally gotten to the point where we just can't go any higher.
[2:06] All right.
[2:06] And so... Are you going to give him that much or not?
[2:09] Well, we won't give him anything under these conditions because if Percy puts the damn amendment in, we're going to need every nickel we can lay our hands on in case it passes.
[2:19] So what does the amendment do?
[2:21] Is that the one that provides for a takeover of everything above 125%?
[2:25] Yes, sir, and immediately.
[2:28] You see, we would be immediately subsidizing the states...
[2:32] for their current welfare cost to the tune of 125%.
[2:35] And it's an open-ended thing because they control the eligibility.
[2:42] How much would it cost, his amendment?
[2:44] Well, his amendment cost us about $2.8 billion, as near as we can figure.
[2:48] My God, is it going to pass?
[2:49] Well, there's a lot of pressure up now because Ogilvy has gotten a lot of governors behind it.
[2:55] In other words, it's a substitute for revenue.
[2:57] Sure, and for welfare reform, perhaps.
[3:01] Yeah.
[3:02] Well, what position does the House take on it?
[3:07] What about Mills and his group?
[3:09] Well, the chances are Mills will not stand in the way of this.
[3:12] He would see it as the answer to his prayer, in a way.
[3:15] Well, the chances are then you aren't going to be able to defeat it, isn't that correct?
[3:21] I think that's correct.
[3:26] We can't veto the tax bill, John.
[3:28] Well, then the alternative would be to make a commitment to Percy that we would support his amendment later if and when Long brings out H.R.
[3:38] 1.
[3:39] And then behind the scenes, maybe we could screw him by just making sure it never came out.
[3:45] What is his amendment, in effect?
[3:47] Well, his amendment is to start the benefits under H.R.
[3:51] 1 sooner.
[3:52] In other words, he'd go up the same kind of a thing, 120 or 125 percent of current costs immediately, pending the effective date of H.R.
[4:03] 1.
[4:03] Yeah, but H.R.
[4:04] 1 would have to pass.
[4:05] That's right.
[4:06] That's right.
[4:08] I would not be concerned about that.
[4:10] Okay.
[4:11] On the ground that, frankly, I don't think H.R.
[4:13] 1 is going to...
[4:15] Make it.
[4:16] Going to make it.
[4:18] Well, all right, then why don't we play that game?
[4:21] Fine.
[4:21] I mean, I think looking at it very realistically, I don't think you're going to be able to, I mean, if
[4:28] If this amendment passes, I mean, I cannot be in a position, John, of vetoing the tax bill.
[4:33] I see.
[4:34] Because everything else is in it.
[4:35] Is that what the recommendation would be, to veto it if the amendment's in it?
[4:39] No, I think there's a lot of loose talk to that effect that's bouncing around because it's getting higher and higher.
[4:46] They lost revenues.
[4:47] Yes, I understand.
[4:49] But you and I know that it may be one of those things where we have to grin and bear it.
[4:54] I understand.
[4:54] With the idea that maybe it's...
[4:56] Let's face it.
[4:57] It may be the way we get the stimulus that we were going to get through revenue sharing.
[5:03] Yeah.
[5:03] Right?
[5:03] Yeah.
[5:05] And it's out there in the consumer's pocket.
[5:07] And this is down the tube.
[5:10] Oh, I think, well, so you come down to this.
[5:14] But what does it gain then to commit this to Percy?
[5:17] He'll give up on his amendment?
[5:18] That's right.
[5:19] And he says he's got his co-sponsors lined up to join him.
[5:25] Mm-hmm.
[5:25] Mm-hmm.
[5:26] But then what happens if he gives up on the amendment?
[5:29] That all that we do by giving up by going with Percy is to move up the effective date of H.R.
[5:35] 1 in effect?
[5:36] In effect.
[5:37] We don't change any principles?
[5:39] No.
[5:40] I'd do it.
[5:41] Okay.
[5:41] Okay.
[5:42] Good.
[5:42] Let's try.
[5:43] Don't you think so?
[5:44] Well, as we talk it out, I can see that.
[5:47] Right.
[5:47] I think that's where we are.
[5:49] Let's be quite realistic.
[5:52] We cannot veto the tax bill.
[5:54] I mean, I just can't do that because of other things, the auto exercises and the investment tax credit.
[6:00] Those two things are in it, right?
[6:01] Right.
[6:02] Now, with those two things in it, even with all this crap that's in it, we probably aren't going to be able to veto it.
[6:07] Yeah, I see that.
[6:08] Under those circumstances, I think we ought to get out a terrible provision.
[6:15] I mean...
[6:16] I mean, this thing would be terrible.
[6:18] Yeah, it would be a one-year raid on the Treasury.
[6:20] One-year raid on the Treasury and the rest.
[6:24] And looking at it from Ogilvy's standpoint, of course, do you really believe Percy means what he says, that he would do that?
[6:34] I think he would.
[6:35] I think he's gotten himself into an impossible situation because he's held himself out to... To be responsible in all the rest.
[6:42] Yeah, yeah.
[6:44] And now...
[6:45] Well, now I think he feels that his bluff's being called, and he's got to go forward with this thing.
[6:51] See, he's got Ogilvy looking down his throat, and Ogilvy's got 40 governors behind him.
[6:57] Yeah.
[6:58] And I have no doubt but what Percy is hearing from every governor in the United States except Rockefeller, and Rockefeller's told him to go to hell.
[7:04] It's a bad idea.
[7:06] Why does he say that?
[7:07] Well, because he can see it'll take all the steam out of revenue sharing.
[7:10] Is that it?
[7:11] Sure.
[7:12] He called me this morning to tell me this.
[7:13] I see this.
[7:14] So he's not for Percy's Amendment?
[7:15] No.
[7:17] He's taking a much more long-headed view.
[7:19] How would Rockefeller tell you?
[7:21] Well, of course, so do I.
[7:22] This goddamn thing is the wrong way to do it.
[7:24] Sure.
[7:25] On the other hand, so therefore we ought to try to beat the amendment.
[7:29] and pay what price we have to pay, don't you think?
[7:32] Well, if we go to war on the amendment, we'll probably get rolled.
[7:37] Even with Percy changing?
[7:40] Oh, if Percy changes, there won't be an amendment.
[7:44] That's what I mean.
[7:44] That's right.
[7:45] That's right.
[7:46] We ought to head it off.
[7:47] That's what I mean by beating it.
[7:48] Pay what price we need to not to have an amendment.
[7:51] I read you.
[7:53] Because the alternative is to have the amendment.
[7:56] And then what's...
[8:00] and then pay the price, and then let's see what happens to HR1.
[8:03] Yeah, yeah, yeah.
[8:05] Nothing may happen to it.
[8:06] Okay.
[8:07] Or do we feel something may?
[8:10] Well, I don't know.
[8:11] Long is playing a very mysterious game on this, and nobody really knows where he is.
[8:16] Well, if it happens, it happens, and just moving it up some, it's just not going to make something that's already bad a little worse.
[8:22] Yeah, it'll be a very bad bird in the hand.
[8:25] Yeah.
[8:26] Okay, well, I'll...
[8:28] But isn't it worse, John, to confront this thing of having what you call this one-time rate on the Treasury?
[8:33] Yes.
[8:33] Yeah, it's very...
[8:34] Which is bad business.
[8:35] It isn't helpful.
[8:37] It's intolerable.
[8:38] It's intolerable in terms of the revenue-sharing thing and...
[8:41] It just bails out governors and so forth.
[8:44] Do you think so?
[8:45] Right.
[8:45] That's my feeling.
[8:47] All right, sir.
[8:47] Well, that's where we'll go.
[8:48] Reagan's against it, too.
[8:50] Oh, is that so?
[8:50] Yeah, he said he was against it.
[8:52] That's interesting.
[8:53] Mainly because he's open-ended, as he puts it.
[8:56] That's his argument.
[8:57] He's against it on principle.
[8:58] Oh, he's right on it.
[9:00] Okay.
[9:00] All right, thank you.