Nixon White House Tapes — Conversation 021-126
Date: Tuesday, March 21, 1972 at 1:03 PM
Participants: Nixon, Richard M. (President); Shultz, George P.
Recording device: White House Telephone
Source: https://www.easynixon.org/tapes/021-126

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 Do not cite it as authoritative.

[2:24:48] Hello?
[2:24:50] Hello?
[2:25:19] I guess I got you just when you got back.
[2:25:22] I just walked in from the drug bill signing.
[2:25:24] How'd you get along with the other George?
[2:25:27] Will?
[2:25:28] Are they going to walk out?
[2:25:29] I don't know.
[2:25:30] He raised questions about the general program, the price side, interest rates going up.
[2:25:36] Arthur Burns abroad saying he wants to get interest rates up and they have the strictest wage controls anywhere in the world right here.
[2:25:45] and so on and burns burns saying that is a jackass damn thing it's a terrible thing to say and it's just like it raises the same problems that butts does but in a different way who the hell is for interest rates going up except the goddamn bankers well i told him that joey had had a little discussion and i wish interest rates i wish that uh all this business i mean i know that it's and i you could see this too then hobart rowans which of course is pure burns i
[2:26:14] ...says that now the government has come around worried about the dollar and all that sort of thing.
[2:26:19] The hell with the worry about the dollar.
[2:26:20] I'm not worried about the dollar.
[2:26:21] Are you?
[2:26:24] What I told them was that, first of all, interest rates were a lot lower than they were at the start of the freeze, but I said, you just let that prime rate notch itself up a couple more times, and those bankers are going to hear from us in no uncertain terms.
[2:26:38] And I say that off of John's comments this morning about his own ideas about...
[2:26:45] calling them in and giving them hell if the interest rates start going up too much.
[2:26:49] And we talked about meat prices, food prices, and some of the things that are in the works there.
[2:26:56] John is back.
[2:26:56] John, got any plan on that one?
[2:26:59] Well, I think at wholesale, the last two or three weeks, there has been a decline in the very high cattle prices.
[2:27:09] Well, I can say something about that.
[2:27:11] Analytically, probably...
[2:27:13] that has crested although it is taking a terrific increase this month as i'm sure you've been told um he talked a lot about what's it go to what is the what a two percent increase in one month in the in the food at home component of the cpi yeah and what's the cpi generally i don't know that yet sir that'll be announced on thursday right the and then they talked a lot about the the the
[2:27:43] Resentment of having their contracts interfered with, I said, well, you know, if you have a control system, some contracts are going to get knocked down.
[2:27:52] Otherwise, there is many.
[2:27:53] Might as well not have it.
[2:27:55] That's right.
[2:27:56] You just can't go approve everything.
[2:27:57] And they sort of expressed their distaste for an economy where somebody in government tells you about your wages or prices.
[2:28:07] I said, look...
[2:28:09] There's nobody agrees with you more on that than I do, unless it's the president.
[2:28:14] However, everybody agreed, and George, you were in the forefront of saying that we had to do something.
[2:28:20] And everybody did.
[2:28:21] And everybody stood for it.
[2:28:23] Most people.
[2:28:23] And he said, well, how long is this going to last?
[2:28:25] I say this.
[2:28:27] The sooner it's over, the better, but you can't get rid of it now.
[2:28:30] The prices are going up too high, and...
[2:28:34] we have to keep the pressure on trying that i said i finally concluded by saying that that i have only uh i talked about the small firm exemption that had gone over to the pay board price commission in the normal course of events right right uh that i had really only two
[2:28:54] I didn't plead with him to stay on the board or anything of that kind at all, but just that first, the president is working hard to make this program succeed.
[2:29:05] Where we find problems with it, we try to correct them.
[2:29:09] And he wants the support of all the main sectors and wants to work with you and the labor movement in making it work.
[2:29:16] And we are going to make it work one way or another.
[2:29:21] And second...
[2:29:22] Whatever you do, the construction industry thing is working pretty well, and we think you'd be doing a disservice to your people as well as to the general thing by disrupting that.
[2:29:34] And he, I think... Well, you made as good a case as you could.
[2:29:39] We had about almost an hour of discussion.
[2:29:41] You made as good a case as you could.
[2:29:43] And he said, well, we'll be talking about it tomorrow, and so we'll see where we come there.
[2:29:49] In the meantime, we'll be getting up some...
[2:29:52] Some suggested talking points on the interest rates today.
[2:29:57] Can you do it?
[2:29:58] Can you make a public statement?
[2:29:59] Meaning?
[2:30:00] Arthur, I mean Connolly.
[2:30:02] Oh.
[2:30:05] There may come a time when we're just going to have to go after Arthur Burns.
[2:30:09] Yeah.
[2:30:09] Directly.
[2:30:10] I don't think this is the time.
[2:30:11] You don't, huh?
[2:30:12] All right.
[2:30:14] Well, the interest rate thing is totally opposed to our policy.
[2:30:18] Right, it is.
[2:30:19] And the prime rate has now gone up two notches.
[2:30:24] It's up to four and three quarters, I think.
[2:30:27] And I think if it hits five or a little over, John plans to...
[2:30:33] Call in the bankers and take the gloves off, or some such thing.
[2:30:36] Well, Arthur's in charge of the damn committee to keep interest rates down, and here he's letting them go up.
[2:30:43] That's why he ought to be taken on on that statement.
[2:30:46] You can't have the chief controllers advocate interest rates going up.
[2:30:51] Right.
[2:30:53] So, I think we've done what we can, and gracefully, that is not...
[2:30:59] I think you did it the right way.
[2:31:00] We just had an exchange of views.
[2:31:03] Right.
[2:31:04] trying to stay on all fours.
[2:31:05] He knows our position.
[2:31:06] He has a political problem, I think.
[2:31:09] They'd like to blow this thing, but if he blows it, it isn't all that bad for us either, you know.
[2:31:17] Then we're going to have to take it on and let our Democratic candidates support George Meany.
[2:31:23] I'd like him to do that.
[2:31:24] One position that I would hate to see us get maneuvered into is where we are the advocates of controls and our opponents are the advocates of freedom.
[2:31:34] and oh god i should say not that we need to be careful of yeah but we will work along on this right oh i know i don't want that i can't i know i understand i understand no you're absolutely right i just uh but i i but i'm going to say i don't think it's going to be that i don't think they can ever come out advocates of freedom hell they don't want for that they're from our controls but we'll see okay all right thank you
[2:32:10] Thank you, President.