Nixon, Mansfield & Scott on International Monetary Policy

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John Burns.

So we'll wait.

We'll wait until a couple of others get here before we have a question.

All right, well, I'll take a little bit of Robert.

After the speaker, and then me, after, is that all I see?

What I think so is that probably

over half the time was spent on matters other than the ones we're going to discuss today.

This is a very far-reaching talk.

Pompidou, you know, has been to Russia and has been to Congress in Paris, and it would be a very valuable insight into his evaluation of Soviet-era views on our policy in general.

I in turn, of course, talk in a considerable length about European problems, bilateral problems, and with regard to the issue of peace in Moscow.

So in that respect, I would say it's the best meeting that has probably occurred in America, Mr. President, for a long time.

Our relationship is great.

You don't like it.

It's not good.

It's the best part of it, mostly.

Perhaps because of what they've done, but we've gradually, we've gradually, we've gradually, we've gradually, we've gradually, we've gradually, we've gradually, we've gradually, we've gradually, we've gradually,

No, I have to say, it's fair to understand that the French-speaking community is extremely valuable.

I thought so.

I thought so for both of us.

It was the most broad-based conversation.

And I congratulate the French-speaking community for improving this time.

A fundamental to our relationship to the French is the matter of the international monetary situation on which we did reach agreement with the French.

John will explain the technical factors for that and what the agreement does mean and what it does not mean.

I would like to put the decision in order.

If you recall, on August 15th, we discussed the idea there, that I refer to the fact that this policy was not simply, and the new policy has been tried, was not simply a policy to stop the rise of the president.

That's the last step to make the play.

but that actually it was a three-layered school.

You had first, we had to move on the inflation front.

Second, we had to move on the job front, that's where the tax came in.

And third, we had to move in here to the monetary fund, to get fair treatment for the dollar and the little money.

And the latter, of course, would also bear very heavily on the job fund, and the long run, not the short run.

Now, I think we can say that our goal on the price line, in phase one and now phase two, it is to see.

I think we can say, as a result of the action of Congress, passing the tax bill,

I think it is probably fair to say

at this time, and that is on the international monetary front.

Because in terms of jobs, for instance,

And that will be a major impact in this intercept.

We had to restore the competitive position of American goods in rural markets.

That meant we had to get a fairer realignment of exchange rates.

In terms of the short run, because first it's hard to understand the rest of this, and of course it's difficult.

With regard to that, I will not get into too much of the Mexican factors.

Let me say that we have three goals.

As we look at the situation in regard to the past, Paul is informing me that we have had seven major monetary crises in the last ten years.

Seven major.

I know that we have had three during the past three years, but before that we had four.

Err...

It became indispensable that we got a new monetary system.

We had a new approach.

We had a mic that pulled.

We had a situation where, no matter how strong the dollar went, that it would relieve us from other currencies around, that it caused fluctuation in monetary markets.

And also, we were getting into positions where other currencies were being revalued at the expense of the dollar, whereas we were standing where we were, and they didn't let me.

That's why we moved on the 15th.

We moved from very, very tough medicine.

We moved from drinking, therefore, to, as you know, less dollar flow.

We moved also, saying that we had to get a better understanding with regard to burden sharing, and that we had to get some understanding with regard to trade, with particularly Europeans and the Japanese.

Now, that's what has happened on those fronts.

But Berger said he had to make sure that the last meeting, the European agreed for the billion dollar report, and our boss had agreed with the German, which was the best we could have, and that we had it correctly expected.

The second, with regard to trade, and one of the essential parts of the agreement with Pompidou, is that now the Franks are going to support our position as to be the common market for Boris Johnson.

The third, with regard to re-evaluation, in other words, the...

With the monetary system, we have reached an understanding of the franc system as to what the relationship should be between the dollar and the franc.

There is still, I should say, a lot of hard bargaining to be done, just as there was a lot of hard bargaining to be done with the franc.

John Connolly will have a meeting with a group of ten this weekend.

And then, of course, we have, to the extent that there are things to be bottomed up with the British, and the Germans, for me, and the Chinese, and the other things that are scheduled.

But all in all, I would say that at this point, the French motorism was, in this past World War II, it was a breakthrough, after we feel very, very good about it.

Robert, how are you?

You should never have seen this.

I deliberately, I deliberately filibustered about a subject I know nothing about.

Now, anybody here seen this word again?

Now, it's essential to manage this understanding.

Of course, it's the actions of Congress.

John, what that means, what the price of gold means, what the valuation means.

I will sum it up by saying that

Actually, the first reaction of the unsubstituted to this is devaluation of the dollar.

And when people mention devaluation of the dollar, they think, oh my God, prices are going to go up.

On the contrary, it does not mean that at all.

It does mean if you travel for one, it does mean if you buy, if you purchase many ones and so forth, that your dollar will buy a little less.

But for the 95% of the Americans who buy America and live in America, then nothing changes at all.

It's what we're really talking about, is getting fair treatment for the dollar abroad.

And that means more jobs for Americans, not extra jobs.

We'll continue something here.

Now, having stated it in that unspecified way, I'm going to present John Connelly, one of the people who gives us leaders.

Well, Mr. President, gentlemen, I will first disavow

that I'm an expert in this field at all.

I have acquired some little knowledge about it.

I've had enough to hold my own with Dr. Burns, to help Paul, to help with Cindy, negotiations that we did, and let me go back to the wrong meetings, because I think that's where serious negotiations first begin.

In the long weeks, we were confronted with a hard-line position, enunciated by the British, based, it seems, upon the entire European community.

The group of states, plus themselves, which we have left behind now, the group of southern states, that had to be more firmly discussed.

There was no hope for any settlement, whatever, unless the United States contributed to

at the Rome meeting.

It was obvious not to that point that

The European community had not taken seriously, or if they had, they had not responded in a serious manner.

To our request, we had to add up some changes in trade, in trade matters.

In fact, you ran it, John, against a total brick wall on trade, and the fact that...

And also, they actually said, I want to report it to the press and after the result.

I don't think I'm afraid about her either.

They said, we can further, they don't think they were willing to discuss what's possible with re-evacuation and on an attack.

That's correct.

That's all.

And they just said, if you will re-evacuate, then we will consider some of these other matters.

And we responded by simply saying that it is an inherent assumption that there can be no international settlement unless we agree to devalue the dollar in terms of the price of gold.

Then it also must be an inherent assumption on your part that there will be no international settlement unless two other things happen.

Unless, number one,

We get some trade concessions, and number two, that we get a realignment that holds some promise for giving us easier to deny balance payments.

I said, now that much is true.

And at that time, they were saying that the United States had to devalue the dollar by 5%.

We took the position then that we were not prepared to...

to commit Steve Adler to dollar, that we could not agree to King's price goal, and I was not authorized.

The only thing that I basically could not commit to was King's price goal, and that was a recommendation which the president had to make, and he did not make that decision, and if he had made the decision, all he could do is recommend to the Congress.

But I said, I can assure you of one thing, and this is what it takes in all sincerity, that the president will never recommend to the Congress the price of gold he gains, unless and until we can go to the Congress and say that, number one, we have got some help on burden sharing, and number two, we have got some help on trade.

This broke out into a four-hour discussion.

They said, well, we're not here prepared to talk about it.

We didn't know this was the right period to turn.

And we said, it's a matter of serious discernment.

The president said it.

He suspended the convertibility of the dollar.

We said it the next day at a press conference.

We said it at every single public conference we've had since that time.

The trade was essential element in this package.

And we said, now we want to know, and it got to be quite an intensive four-hour discussion, and almost was one of the embarrassing, where we said, we want to know whether or not you're willing to commit your representatives to the European community here and now.

So we were met with a hard line on their part.

And without going into too many details, let me, you guys, have all been in lots of bargaining.

And lots of negotiations, one kind or another.

And I assure you, it's not the easiest type of negotiation.

When you're sitting there with 10 nations represented, and you have to...

You were in an adversarial position with respect to every one of them, and every one of them speaking with the same objective in mind, and they hit you from one side and they hit you from another.

So, yes, we came out of it with a, how long we've been, with somewhat of a tough stance and a hard stance, and we made no apologies for it, because you can stand off nine nations.

When they're all putting pressure on you, the mere sound of their own voice convinces them that they have the security of numbers, and that they must be persuaded that we're alone.

So we did try to hold our own in these negotiations.

But central to the whole discussion, there was a current...

That France was probably the key, and we don't want the public to say that they were the key, because this tends to reflect on the creation of the nation.

The truth of the matter is that France was in a key position for a number of reasons.

First, because they had very little trade with us.

...from the flow of currencies.

They don't want to take dollars, they don't take dollars.

They still let them in.

They control their entire banking system in a unique fashion.

So they're almost impervious to international monetary movements if they want to be.

So, plus, they have very ideological commitments to gold.

It's been a matter of centuries, wasn't it?

So, they had a fixation back then.

First, they didn't overcome it.

They won't overcome it.

So, they were sitting in a very key position.

The Germans won't accept it.

Other nations won't accept it.

But all of them were interrelated, which you all know.

The Japanese were settled, but they were settled in the European community.

The Germans want to settle, but they want to know what their relationship to the French is going to be.

They want to settle with us.

We have no problem if we could just settle with them.

But they have twice as much trade with the French as they do with us.

So, the remarked relationship to the French is much more important to them than the remarked relationship to the dollar.

The same is true of the account search, and the same is true of the attack of the barrel.

So it was absolutely essential.

that we recognize that there were three elements.

First, the key element of the European community was France.

Canada is a separate problem.

Japan is a separate problem.

Canada would not move and may not yet move.

They still won't move.

They have yet agreed to become a part of the explosive national settlement.

Japan is not going to move until she knows what the European community is doing.

Because she wants to pierce that European community to a greater extent than she

We take 30% of their world trade.

Europe, which is basically as big a market as ours, takes 5%.

And the reason they take 5% is because they won't let the Japanese products in.

They all talk about what great free traders they are.

And they're not free traders.

They have divisions and barriers erected against the Japanese as well as against us.

So we're trying, in the process of getting this realigned,

to break down some of these trade barriers if we can.

And we don't kid ourselves.

We know where the money is.

The money is in the realignment.

But we took the position, we insistently take the position, that we're not going to settle for what we know is an absurdly insufficient realignment.

And let the world think we settled the problem.

And we took the position that 5% was an insufficient, half an insufficient realignment.

We weren't going to do that.

So, Paul Volker, in the vetting meeting just prior to Rome, hit them with 11% weed average reliant, which, on our calculations, would result in a...

The improvement in our dollars was payments for about, on the high side, frankly, about $9 billion, which is a lot of money.

Now, they said this was too much.

They couldn't do that at all.

The French were very quiet.

You run into all kinds of problems, and if you let me switch the comments, then one of the problems we have is knowing how much authority the various ministers of finance have.

It so happens in France that you start to say that the finance minister is the leader of one of the parties in France.

who has a great aspiration to be president.

And the president wants to do what's on him as a rival.

They're not even the same party.

So he obviously doesn't want to start the same, get too much credit for anything.

So this company, it's our negotiations.

So the president felt that if we really were going to try to solve this problem, and we, again, the president felt that we

We cannot only be either political or military leaders in the free world, we also have to recognize that the leadership extends to the economic front, because we are the largest trading nation.

Our TNP comes in each year, our increase, and TNP creates a new president, a new president, every year.

Next year, most economists will agree that, heard you and Paul correctly, if you think I'm wrong, most people will agree that we'll have the increased GDP of approximately 100 million dollars next year.

This is the total of the GDP of Great Britain, the basis of the total of France.

And when we're confronted with problems where we compare rats and horses, because they both have four feet,

Great Britain, for instance, said in Rome that they were crying.

We're in terrible shape.

We've got a terrible depression.

We've got high unemployment.

We just can't give.

If you go, if anybody more than 5%, we'll have to go there with you.

And the French and Italians say the same thing.

The week after we got home, Great Britain announced that this year their policy payment surplus would be $3 billion.

The largest in the history of the United Kingdom.

And in terms of our equivalent, that would mean that we would have, if we were as good a state as they were in our balance of payments, we would have a surplus of $33 billion.

And we're looking at $11 billion next year.

So, this puts in perspective the problem that we have.

So these were the things that led up to the president's feeling that when he met with Congress, that if we were going to really try to get it covered, frankly, we've gone further than any of the other countries have in spite of their public utterances.

They're stand-up politicians.

They're better than we are because they play their politics as the press.

Because we're the largest nation in the world, we don't bear to live with it.

We had to take it.

So they accused us of being the instructions.

And yet we've been more outpoured.

We've been pushing this stuff much harder than any other country has.

But we were afraid, the president was, and it's incorporated to Pompidou without a basic understanding.

that we probably would have lost our chance to negotiate and we would have suffered.

So as a result of a day and a half of very tough bargaining, the French have essentially agreed to the following.

They have never given any indication that they would permit us to devalue more than 5.5% and for them to stay still.

and not be valued with us.

It's very clear now that they will go beyond that, depending on what other countries do.

They will go considerably beyond that.

This is of the process of negotiation of competence.

They have always maintained that they want no widening of the margins.

Let me explain that.

Most of them sure know, but under the present IMF setup,

We may say that

In this period of uncertainty, that there should be wider bands, some have talked about 3%, during the 9-up meeting year, we talked about 3% up and 3% down, like here's your swing of 6%, which is a very substantial amount.

The French have been far, far away opposed to it.

are very, very dedicated to fixing changes with practically no margins at all.

They only like 1%, very frankly.

And they have consistently said that under no circumstances will they go beyond 1.75.

Well, they went 1.75 down, and they said that's far too much.

But it's resorting to the medium and the authority.

They won't go beyond that.

No question.

And what should...

will again depend on what the total settlement is.

The French have been the strongest nation in the community with respect to the protection of trade and policy in the common market.

On Saturday, last Saturday, just prior to our departure here, they took a position in the European community.

Two months.

After hours and hours of debate, he refused to let the European Community Department of Representatives talk to us about trade matters.

He refused to.

Although the five nations agreed to open negotiations with him, to me, the French were intractable on that point.

So, when the President met with Pompidou, he said, in fact, there can be no settlement unless you want to talk trade with us.

And as an upshot, the French have agreed to talk trade with us.

And they have instructed.

Their people have been communicating carries to some indication.

Now we have not specified, we do not want to specify precise trade items, because this always does build up back pressure all over Europe.

But we have a list of specific items.

We can talk to them about that.

They understand what those are.

And they're some of the toughest things that they have to deal with because some of them are right here in the middle of Asian countries.

But they have agreed to instruct their permanent representatives to give them a mandate to immediately begin negotiations.

And they understand that these trade negotiations are an integral part

of this whole trade.

Now, we separately have been carrying on trade negotiations with Canada.

Intensive negotiations.

We had a team over the weekend, when we were going to the Azores, we had a team in Hawaii, talking to the Japanese, and we were carrying on extensive trade negotiations with the Japanese, and each of these groups, we almost characterized them as three groups, Japan, Canada, and the European community.

We're going to carry on separate negotiations as far as trade matters are concerned.

As it is, it is very important for us.

It has to be out there in time for the first stage.

What they're trying to do, all these countries are trying to get us to move just in the field of real animals.

Forget trade, forget burden sales.

Now the president's already won a major victory, he told you he was going to go, by gaining the best offset agreement he's ever had, by gaining the scenario forces to agree to put up a billion dollars a year, more than they've been putting up for their own, for our common defense in Europe.

Now we've got trade.

And we stood on that, and we also said, and I must say to you and all candidates, we used it as a bargaining lesson.

Because we said, we're not, the president's not going to recommend a change in Congress without some trade.

Unless we go there and say, here's what we need to do the burden sharing and trade.

And we don't think they're passionate.

So that's the posture that we're in.

This is the posture that we're in right today, if you're considering returning.

We think that having broken ground with the French, that this sets up where we possibly can get a resolution to solve that issue.

We have some indication the Japanese actually wanted that before the premier soccer league was mentioned.

Let me ask you something.

Are you going to have to have congressional action to follow in this?

Yes, sir.

No, not next week.

Why don't you say why you did tell them a little, why some of the thoughts of the person that suggested that they should act now.

There's been some suggestion of Congressman Royce and others that said we ought to pass a resolution right now.

Well, assuming that you could, and assuming this reflected the will of the congressman,

We can do a question, and we ought to do that right now, because frankly, we take away one of the big parking levers that we have for these folks.

We're staying good, and we're staying good, unless we go up and say to y'all that we've been given a break.

I understand that we're being completely frank and honest with you.

that we are going to have to have progressive action.

We hope it stops being that there's no partisanship in it at all, that we're going to make the very best deal we can make using every device, every maneuver, every lever that we have.

And the time is going to come when we will have to have progressive action, and we would want it as soon as it is possible, simply because

We've got a very difficult technical problem of how you affect a realignment without the orthodontist.

I think Mary said that the question came up first, and so...

Every viewer sitting in, you might quite often be directed in front of that problem.

And the way we get at it, basically, is just quite often on the trade thing.

And it becomes emblematic when Congress has a problem.

Yes, yes, yes.

I mean, when we do send it to President W. on the United States of America change, and it does go through the proceed,

He didn't want to be associated with the trade thing.

He seemed to be blackmailed into the trade thing.

The president said that his problem was that he couldn't go to Congress.

Men have to put a blind check without being able to go to Congress.

We all can't go to Congress.

He would have to tell you.

Everything else would have to go to Congress.

and put before them the recommendations of speedy action and total kindness.

And then you would undertake to do that much that you could not ask for it.

Well, the truth of the matter is that we trust ourselves more than we trust them.

They want us to be back, and then they'll talk to us about trade, but we won't deal with them.

We won't know where we're going to trade the pork.

We finally take a step to get back in the box.

It's not just a question of trust, but they give it up, each of these nations have given up a great deal to this European common market.

So they high-five and go to that individual, and they say, well, we can't deal with that.

That's not a European community process.

Those European communities, they say, well, we can't do anything.

We have a mandate from all the countries.

And they run you around and stuff all day long.

And it's extremely difficult to get all you... You could end up on a train very frankly.

So we don't want to give them love.

I said approximately 9 million dollars, but since we make a point of this, now let me, there are estimates that for every percentage point in this wage marriage realignment system,

We pick up from 500 to 800 million.

None of us sold the ship.

We think it's a little less than 850.

Georgia, I'm not sure what his position is.

Arthur, folks in Ted have a position.

But it's in the range, I would say, that I would call history.

That's what I'm saying.

I would say 800 is an outside figure, although there are one or two people who think that it's not the outside figure.

We think that it's gross.

The, uh, could I, could I ask, could I say something that I think is very important, that we can even all believe that, well, apart from, apart from the legislation, that we should be fine with that.

It's very important to avoid the imagination.

As to who won and who lost.

As you know, the first story is very, very French.

And the second story is very American.

Let me just say this.

We got a very good deal.

Let me also say, Pompidou, in terms of his problem, got a very good deal.

There isn't anything in this Q&A that we have created where if one completely whips the other, and Pompidou is deterred, then the end of the year is time, it is amen.

He said, I said, well, I said, John, what is worse, I was sitting in the office, and Henry was there to do the discussion, and then John would be meeting with the president, and I said, you know, the secretary, the treasurer doesn't like to be alive, but he decides to be alive on the day of the weekend, so I think, of course, what the things are, is that what John says, and so it's a good thing.

But I think you really think it's been an unpredictable surrender for us.

We're both, but I think you say one word about how important it is for us to, frankly, work together.

— 1 min 10 s with no transcribed speech —

that almost everything in the secondary treasury is set out to get, we are very close to get it.

But the price of gold, we must emphasize, I think we'll hear this, this is part of the great question, the price of gold to a tax minister.

or to a French political leader, while it is serious to us.

So that is the theology of a political leader.

It says the same word about what the French do, ever since the...

The goal is...

Det var svært svært svært svært svært svært svært.

So this is the political requirement that when we do that, and therefore it is important, depending on that, that we don't characterize ourselves as American tribes or American states, but we still need that cooperation.

It was one against nine.

It really was.

And frankly, we had to do now.

Mr. President, we did have to.

We had to take this to the Senate.

It had not been for Dr. Burns who sat at these meetings and said, along with the other senators, thanks, Governor, for the nation, and all voters.

We sat there, and we got called over to the Senate because I'm chairman of the U.S. Senate, and I said I want to maintain some objectivity as chairman, and we had a call over to speak to the U.S. Senate.

At large, it was a call over about learning where we are in terms of the negotiations.

But I would say that the problem is, let's show you what we have to get to, so that you can see why it's an emergency.

You see, we didn't have to make a deal.

We didn't have to.

We think that our long-term interests are better served by some stability in the international economy, but our option was not to make a deal with Europe.

And that's of course to pick off the others, right?

Maybe we look at Canada, maybe we look at Japan, although it would be very unlikely we may look at Japan because Europe would give them the future more than we can because they have so little under their belt.

But our alternative was, which we had over the last, we just needed a float.

That was a great idea.

We became in a lot of instability.

It would also mean that it would pose problems for them.

So populism had also made no change in the price of gold.

So far as populism is concerned, he's able to go back and say, look, the Americans were in this position, but they weren't building it.

And if we hadn't moved on this, we wouldn't have got a retreat from the price of gold.

That being a fair statement, the opposite.

But he used that argument.

And we, incidentally, we're considering that.

If we haven't ever gotten, if we have not gotten, but we haven't gotten yet, we've got to make a deal.

with the group that had an order over the next two or three weeks to wrap it all up.

But if we had not had this option, there would have been no incentive for the French to take it.

It's a little trade with us to make it go along.

The others have some incentive to drive, and these have some incentive because the surcharge affects them so much.

But here's the difference.

The vertical trade is a spring level affected by the surcharge.

So, it's not cold and violent.

So it helps us make the less part of the bargain.

And equally importantly, I think we all need to start something to get rid of it.

Without being specific.

Break.

They have great strength with the Italians and with others.

They agreed to help us with all the irritated communities, not alone, but on the face of realignment.

This is why I think this is a good chance that we can get.

They want to trade for realignment.

It's just the toughest, I believe it's the toughest kind of bargaining.

If they give a great deal on realignment, then they want to cut out on trade.

If they give on trade, they want to cut out on realignment.

So we're just trying to get everything we can get.

Only the assumptions that whatever we get is probably not going to be enough.

Because, again, we go back into a private tax position, and other countries have a pretty good move, either in revaluation or devaluation, that is denied the United States because of the tax.

So we're trying, we know, that whatever we get now is about all we're going to pay for.

That is why we've had to hold out for a much higher number than 5%.

I was at the present, I would, if there were no questions, or even before there were questions, I would sure like to get some expression from the leaders in here about how we ought to proceed, and whether or not they would take away the attitude, or whether they would indicate some support for you in January, and what I actually had in mind.

Because this is absolutely crucial to us.

Mr. President, can I ask the Secretary, what kind of legislation is it?

Is it relatively simple, or is it complex?

We treat birds, birds, birds.

Here's what we would anticipate the readers to do.

The way the play will work out, you'll have a meeting with the group, and possibly have an arrangement to have it worked out in that time, or we could hold it.

It might take some time to wrap it up.

It's all a school thing.

We've got it on the weekend.

Assuming that the group of 10, who are finance ministers, do not want to wait until there are meetings at the high political level, they might want to do that, but we don't think they will.

We would then have a number, but we were thinking about in terms of how much the prices will be raised.

And then we would ask Congress to buy any change for all of us, specifically to ask Congress for approval after... Well, there's more than one way of doing it.

It's a straightforward way.

You just ask Congress specifically for authority to propose a change in the bar value of the dollar in terms of gold in the IMF.

And that's provided for in the Brentwoods Act.

It's a very simple act to say, here's the new change in the price of gold that you may propose to the IMF.

Uh-huh.

We can do it another way, but we maintain that we're not going to do it that way.

We can do it through the IMF itself, subject to later ratification by the Congress, but we think that we're not going to presume on the Congress' powers unless the IMF does it, subject to ratification by the Congress.

We just take the position that we want a frontal approach, but we're at it through the Congress, and it also helps with our bargaining.

Mr. President, may I ask a question?

The authority we would give, would give the president the flexibility to do it, it wouldn't be automatic.

Would there be flexibility in terms of amount, or would it be a specific amount?

It would be a specific amount if it was time, but you're going to run into a long one, so don't fix it.

But we will have a specific number of others.

And that's why I'm here with you.

I've run into this thing where I've been.

I've said that I'd be willing to increase the price of gold in order to get properly aligned with the currency of the world.

And these older people, I ran into them at New York University when I graduated in 1912, and when I...

I know you don't know what to say to him, but...

Honestly, it's just that person, which is in the church.

I've been there since 1934, and we've been there since 1912.

I don't see any game trail, but I've found it's easier to do it.

It's 5%, whatever it is, it's less dollars, calories, the price of gold.

That's the reason that we have resisted, frankly, the idea which has been expressed by some members of the Congress.

Whether to give them discretionary authority to do it, you see what I mean, which puts them in a position to make the decision, and then ask the Congress for approval of the deal, which in other words, as I say to you, which will remove the uncertainty.

Is that, if I were correct, John, if I were to state what the machine does, that's absolutely correct.

But we would like to know, and you do know, that it's a very great matter for the President to speak for the country, in effect, basically.

We have to remember that we've been around this track before.

The first thing I say is that I am in the reaction part of the conversation.

Extraordinarily good.

It's been good, but actually, everything that I've read is disseminated from the Senate to the House.

There's been conditions of all the satisfactory relations that have been tried there.

I think that the leaders should say, in fact, let's just play it out.

If the leaders, if you believe what Carson Cooper said, that if they decided that you got a part in the tech trade, the tech trade is going to conduct these very sensitive negotiations over the weekend,

And we hope that the satisfactory settlement is made, and you believe that there will be bipartisan support of the Congress for the years where they're going to be.

That's really how that's going to be over at that time.

So, yeah, thank you.

I've had a word of criticism so far.

But it's because it's too much competition.

President, I feel it's the most generalized of all the recommendations.

Royce and James.

Well, they're all here today.

So, I hope I don't have any questions.

I don't know what they were saying.

How did they tell you this?

They came to the office.

One of them was whistling

Overland, I'm talking about, was the road in Franklin.

The road, there were two footbikers, and they were playing weed.

That was the same thing that you've got biker centers in.

A lot of times, that was the light.

The light, they sucked us.

So that's kind of pretty much, that's what they did.

That's what they did.

That's the market.

I think that's the market.

I think it was, they raised the price of gold.

They would pay for gold, but...

We still have not gotten our price up to what is about the world price.

We'll still be under there.

World price is over $40.

We're not talking about that in the world price.

They thought that we had to give them that.

Our objective is to increase the price of foreign currencies in terms of gold.

We want to be 11% advantage.

Now, when you get down to 5%, they can reduce the appreciation of other currencies in terms of the dollar.

Now by going higher, we can get a higher rate of appreciation.

You know, when they say 5% they're not just trying to do us a favor.

They're trying to tend down the appreciation of foreign currencies in terms of dollars.

In general terms, that would give us a correction of about 4 billion dollars.

in our ballot space, and that led us to figure out about 40, the 5%, as opposed to the 9% we're talking about.

Because we weren't talking about doing exactly what we would do on the other side.

They were talking about doing more.

We are not asking, let me say to the leaders, I think, and I must say, and I guess Mike, you were both pointed out, that members of Congress have been very helpful in what you have said all along, and pretty much what you said after this, and I think you're going to look into it.

But I can only say that as far as what we have agreed with Funk to do, it is something I can give you an assurance that all of you will approve.

Now, all we, what we really want to do today is to say that we can, is to have some expression of confidence in the Secretary of Creation as he negotiates

This is one of the things, because you can't do development, but it's something where it has to be done, or it's sort of up or down.

It's almost, I think it would be fair to say it's somewhat in the category of let it be.

I mean, you can't go on and put on codicils, or what do you call them?

It wouldn't work.

Because we are, when you get down, believe me, it's been an eye-opener to me.

I think you can follow up on that.

I don't know how you can do that.

If you're reading down the very fine points, you're talking about a quarter of a point here, and a half of a point here.

You're talking about the bands.

We've got to be in a position that is, the Congress doesn't say anything.

Because we can't go back to ten days.

If we have a prolonged debate about it in Congress, all it's going to do is develop wild kind of speculation worldwide in all the money markets in the world.

That would happen, wouldn't it, if, say, you succeed this weekend and you make your announcement, and then Congress has to act a month later?

This is one of the technical problems we have here.

No doubt about it.

What we're saying is that only the fact that most of the major currencies in the world are pouring in, and if we get it either, if we cut it either,

I think we know what we're going back to, and no one's down to earth.

But that's possible, because most of them are floating.

France is not, but they've got such controls that they won't be affected too much no matter where they go.

Well, does that mean that there shouldn't be much leak time between me and us?

Absolutely.

The time has come.

That's what I'm asking you.

It smells better.

But we may want to announce them.

You know, if you get the group of territory, as far as any announcements, it will go out like that.

As a matter of fact, I would not let you say that my standard that we have with pumpkin, of course, is very specific.

We will not put it out.

But who knows whether that number will get out, or those numbers.

We won't put it out, because I frankly thought we would have won it, and I don't think we would.

But it's very close to, you know, Secretary of State, Secretary of State, and so on.

I guess the entire video that you made, Bill,

I don't think I'm overstating.

When I say that I don't mean everything that we want, but it is a very good deal.

Would you care to tell us about it?

Absolutely.

Now, one way we can do it is to get the Congress to do what we prefer.

We can technically do it.

If we make it equal, go on and let the IMF

to effect to placing the new race structure study to ratification from the congress that we do it and that's one way to go is by the law of resolution could you do it in the federal period that's what I'm getting at

The other advantage of that is that our trains, whatever they are, are not delayed 30 days.

Because the trains have to take time.

You know, we've been making this a novel train that's been affected for six months.

So the pressure we can get, I think that's about it.

If you go this way, Mr. President, you offset the possibility of some pressures developing against Congress in the next place, because you've got it in operation.

This is another huge question.

We're still submitting it to the Congress.

Yeah, right there.

Let's see if you can answer it.

I agree with the goal and the emotional nature of this country.

And anything that's done that will generate pressure on Congress will be a disturbing factor.

And the more that's minimized, I think, the better.

Well, do you agree, right, with the use of this international program as a device?

That has some feel.

It also has some attention.

It gives time to generate opposition.

And distrust.

I know it is this versus doing nothing.

Oh yes, that is indeed.

If I had something, I had to.

And so here it is, operation.

Yeah.

And he could wait in that period.

See the benefits of trade.

There's one other thing, right?

There's one other thing that it would do.

What she suggested earlier.

In that 30-day period, all the fears that people had, when they raised the price of gold, it couldn't be dispelled.

That's what happened.

I understand a lot of it is about dragging money on board.

There are a lot of folks who feel that way.

It grows about memories as you go off the gold standard.

We've probably been talking about that for years, but it's necessary.

Because Mike and I have been talking, and we both feel that I have had to say, that's not the right way to manage our business.

Then we have a specific proposal to validate things easier, and that's very easy for me to say.

What you still have, aren't you, is the idea that you talked about, is that in the 30 days after you're 18, potential times may be an announcement that you're going to pursue a course with a specific thing.

I want to make two points, John, at this point.

We may not solve it this weekend.

We will not have another meeting until the chances are after the first of these premieres stop.

But we are going to solve it at 15.

And when you say that we're not solving it this weekend, let me say it.

To reassure the members of the leadership here, that we have broken the law, and the solution is now certain.

I mean, you may not get it done this weekend, because it's so complicated, but take a look at the trade thing.

It may be on that.

We won't do anything on that until we get to Moscow, right?

I'm sure that's right.

So there's another reason.

I'm moving out of that place.

Bye.

It's the best way to do it.

Thank you very much.

I think the people would be a very big surprise if you didn't have to serve them for a little bit.

Yeah, yeah.

I understand what you're talking about.

It's a fact.

The amount of money in legal tender today is, we have about $50,000 today.

Right.

As long as that's funny, we'll pay you again.

We're going to test you on the dollar.

We've got to get that lost.

We've got to do anything for all of us to realize that all of this is talking about the dollar.

I mean, the world.

What we're getting here is spare treatment for the money.

I've got no doubts about the dollar.

We're doing better than they are.

We've probably been present.

It's fair to say we have now less inflation than any major destination.

Thank you.

Let me ask you one question.

Sure.

What we're talking about is using IMF as a temporary law.

Correct.

We're still coming to the Congress.

Yes.

We're still trying to build.

We're trying to build.

We're basically currency committees.

I think that's correct.

Is that right?

Yes.

— 2 min 3 s with no transcribed speech —

A big problem is the last you might mention, the question of whether it interested people if we wanted to agree on the timeline or not.

I suppose that would be a problem right now.

I can tell you that the tax resolution has a lot more in it.

I like our previous attitude, this is occasionally how we started to pass everything, it's time to go home and increase the pressure on us as well

Mr. President, have you made any decision on the money you would give the State of the Union?

Well, I think around the 20th century.

I suppose the tenant has that step-up data on the house?

Yes, yes, and that house didn't do it.

That doesn't count.

Gentlemen, I want to say and express a great deal to tell you, you know, before the meeting today I was trying to think of some of the gadgets we could give you.

Although I understand that is the bad word.

Hopefully it didn't work for him.

We promised you had virtually everything that we expect to have around here in the meadows.

But I did find something that I've been pretty bored to have.

This is a very unusual thing.

It's a presidential money flip.

Ha ha ha ha!

I'm going to say it over.

You've already got one.

Give it to that guy that's trying to attack you.

It's all good.

It's funny.

It's still going to be worth as much to me.

I'm going to say it over.

What are the comments that would please be careful not to give away any position with respect to how this will be handled through the IMF?

That's right.

What would you like us to say?

I've got all four of them.

Basically, I would hope that you just say that the President is impressed with you on the status of all the negotiations, and what he's learned, and if there's some hope for

Thank you very much.

Nixon, Mansfield & Scott on International Monetary Policy

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Also recorded on December 15, 1971

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Nixon, Mansfield & Scott on International Monetary Policy

AI Summary

Audio

NARA Description

Nixon Library Finding Aid

Transcript (AI-generated)

Also recorded on December 15, 1971

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