Conversation 113-002

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Well, I'm sorry.

Welcome to the first formal leadership meeting of the Republicans at the

We have our subject today, and it's one that we'd like to get out of the way as soon as possible.

Because I've offered those captions, and it's usually boring, controversial, and miserable, and it's just not supposed to be.

So, it's a subject that we first, I think, has the primary responsibility to accomplish, of course, and support and responsibility.

I'll simply start it out by saying that at the present time, as you know, last year we didn't want to fight and try to end it.

We didn't want to steal it.

But we did apply that to ourselves.

So for 1973, as the pledge agreed to go, and that's why we had to go up.

We had a budget of $250 million.

The budget for 1974 would be a billion dollars higher and that's quite a chunk.

That's only 20 million dollars less than it would be if the Congress had its way and all the departments had their way.

We decided we've got to keep the budget for 1974 at that number.

That's 168 million dollars.

And we've also even projected it for 1975 as the webinar will show, which adds another $18 or $19 billion for that year, all to Big Jump.

What I'm gonna say now is,

something that was heard here first time.

He's going to be here for a second.

We have a five-part economic report.

We didn't have time.

We're going to get more questions to deal with you folks than we are.

Five-part, so they'll get some of the economic stuff.

The economy for this year looks very good.

It's been a very good year.

It's going to be that things will go on.

It's a very good year in 73, and a very good year in 74.

I would say more than passing interest.

The major credit of that economy is overspending on the budget.

If we bust the total climate budget,

either higher taxes, or higher prices, or both, and a different economy.

That's why we've got to hold 250 for this year and 268 for next year.

And that is why this means that whether it's economy for this year, or whether it's moving on some programs that many people have very strong expectations for next year,

We are fighting this battle.

In other words, putting it quite directly.

I hope that some members of this leadership, as well as even more in the bipartisan leadership, raise individual items like this on agriculture and education.

sewer system, whatever happens and so forth and so on.

I don't like it.

I mean, it's much more pleasant to just work.

But the most important thing I have to bear in mind is that I have a responsibility, and all of you do have a responsibility, too, in a sense.

But I have it only.

So look at the whole budget.

Each of you must represent a special interest, but I look at the whole budget.

As I look at the whole budget, I realize that the choices that I have to make every time I approve spending more than the limits that we have now imposed on ourselves, 250 for this year or 268 for next year, I am in effect approving the tax increase.

So what anyone wants to add to this question,

And we had our first preliminary meeting on this table in the cabin.

And I said, fine.

But anyone wants to add to this budget, remember, you're asking me and you yourselves are asking for a tax increase.

That's it, cold turkey.

So if we do this, I understand all of you have got to ask for this.

You say, don't count this and add here and add there and so forth and so on.

But there's no other choice.

250 is at the outer limits for 73.

268 is at the outer limits for 74.

We stretch it just as far as we can.

And we've got the full employment revenues up there just as high as we possibly can.

And so we maintain that credibility.

But the question we have is not whether or not you want something for limestone, not whether or not you want something for REA, but the question is, do you want REA or do you want a tax increase?

That's what it is.

So that's the issue I'm looking at.

So somebody else would be for limestone.

I'm looking at some tax increase.

I just want to lay it out right now so we all understand.

I totally understand how many of you have got to come in and advocate for those things.

But when I have to go to the veto or to the pound, it's going to be in the, I'm going to do it in the name of the school district.

And those of you who work for YMU or REA or for impacted school area, you're going to be for those things if you are.

So that's the way we have it.

When I always start with the ratings and bills and moderators and don't let what I say keep you from talking about what you ought to add to the budget and what you'll add to the budget.

If anybody has any opinions or suggestions that they're not in power, I want you to say what kind of attack you recommend.

Mr. President, I would have said you're always going to be at the table on both cabinet meetings in the year.

All right, I think it'd be helpful, Mr. President, before we get to 74, to review where we are in 73 in Kettburg, I think, compared to that.

Mr. President, Vice President Tillman, the... Oh, whoa.

These are the standard ones.

You can't have a budget rating without these charts.

The actual over 72 is where we came in with revenues at 208 and expenditures at just under 232.

For 73,

This is the way we are now revising the 73 budget, and that's what we were going to talk about here first.

But I then have an opportunity for questions on it.

And that one came in at 225 of the revenues that held this embodiment through the year.

And expenditures are now recommended at 249.8, just under the 250 limit.

That still leaves us with just about a $25 billion actual deficit.

It reduces the full employment deficit down to about $3 billion.

It's the second year of a full employment deficit in roughly that range, and everyone feels that that is right about on the edge of an inflation-producing kind of deficit, but $24 billion actually is.

that we are talking about and that are recommended and that actually will be made under the recent founding actions of the board.

And that still leaves a $25 billion actual deficit.

More 1973, 74 will take up a minute, but we're coming in at the 12th.

It's our actual episode and full of 1,000.

Just while we're on this chart, the percentage of the outlays with the federal government budget outlays is pretty constant.

It's actually slowing down a little bit as the GNP rises.

So that there's still roughly 20, 19, 20%, 21% range of that.

But state and local government are now taking over 34%.

So that when you add the totals together, so that when you add it all together,

And this is a real justification for just everything the president has said.

When you take it all together, government at all levels is now over 34% of the total gross national product.

And there are a lot of people who feel that when you get over 40, you don't really have a capitalistic, free enterprise incentive system anymore.

Well, that's the general reduction on the whole thing.

A couple of technical points.

We will have the chart, but we'll have the budget itself to you today.

And in addition, we'll have a book of charts like this.

We'll have all of the charts that are here and a great many more.

But may I say that we'll talk to this before.

The budget document is 370 pages long.

Uh, but the charts, uh, we want to discuss, but they are some of the best we've ever seen.

I will, I demand the charts, not the documents.

The chart book will have all that.

In addition, in the back of the chart book, there will be all the numbers.

When you see numbers or charts like this, then the exact figures will all be in the back.

It's the same with this.

and so on, and that will be here.

Can you read those green figures off?

The expenditures in 1972, actually, were $231.9.

The budget for 73 as revised today is $249.8, just under $250, and for 1974 is $268.7.

$268.7 is the number.

And frankly, Kev, I think that we ought to round that off at 2.69.

I don't mean an hour from now.

But 2.69 is what I am going to request a Monday night radio broadcast, which I will mail to all of you.

It's not very long.

It's very simple.

It takes all the scuffling to do, and it translates into English.

But the fight is that the 269 is the ceiling to make the Congressional vote overall.

I never explained it.

The national number last year was 215 or 274.

It's 269.

And that, it gets it done.

It's an indication that it really isn't.

it's all that austere there's been an 18 billion dollar increase from 72 to 73 a 19 billion dollar increase from 73 to 74 almost all of it mandated and as we'll get them on a great deal more would be mandated if these reductions weren't yet would you just repeat

The difference each year of the outlay is over, you see.

Yes, sir.

The deficit in 1973 was 23 million.

The deficit this year is just under 25 million.

And the deficit in 1974 will be 12 million.

And a couple of quick technical points.

We will get these books that are actual, that's just not full of action yet.

The 1974 budget will be a full employment balance.

These two were full employment deficits in the neighborhood of three to three and a half billion.

And our approach has been that the full employment deficits for any long period of time and any substantial amount is bound to be inflationary.

It always worked in the past.

uh all this material as everybody knows is embargoed until noon on monday when the budget is formally transmitted and uh we will get the uh the folks as i say about the public today now the next thing on 73 budget

This is an indication of how fast the thing actually can go.

A year ago today, or a year ago yesterday, the President sent to the Congress the 73 budget, which was $246 billion.

By June, when we started, when we completed our spring previews and the work on the next, on the 74 budget, preliminary work,

That had jumped to $250 billion, and we knew from the examination of the bills pending in the Congress and the likely vote of the Macklin and so on that it would probably go to about $260 to $261 if nothing were done.

And it was at that point that we were ready to determine that we simply had to hold it to $250 because if we didn't, we would then have a $35, $36 billion actual deficit and a full employment deficit of about $14 billion.

which I think anybody would agree would be completely equationary and would have required more tax.

So right in this period, and we saw what was happening, the determination was made to try to stay at 250, and the ceiling was requested in that amount, again, the initial ceiling having been requested earlier.

When Congress did adjourn, I think October 27, it was just over, just in that range of $261 billion was the spending that had been voted.

And so the actions taken in the impoundments and in the reductions in the legislation that's requested,

We'll bring that down to just under $250 billion.

But it's an interesting example of how fast this thing goes when you just look at separate pieces.

And as the President said, you don't have an opportunity to look at the overall effect of individual votes.

So the bunch of strain transfer, what happens without any worry about reductions, gets it right up into the 261 range.

Now this is an example, and we'll pick this up again, but I just say one thing there.

Do you remember during the period of September, October,

The administration is being dishonest.

They are correct.

Had we not insisted on it, we would have had to have a tax increase.

And it's because we cut her back to $250,000 that there's not going to be any tax increase requested this year, as Campbell showed.

Provided we stay at this.

But in fairness to that, they know that these guys, the numbers of what was coming up as well as we did.

And we were looking at one.

We had limited a choice, either hold it to $250,000 or ask for a $10 million tax increase.

And that's why we did, for the first time, a very complete look at the budget in 1975, as well as 74.

In many ways, this document is almost two budgets instead of one.

And it's really three in one sense, because we made so many reductions and changes in 1973.

But when you look at what happens, if you just let this alone, if instead of moving back to 250, we let it stay at 261,

Then instead of reducing the deficit from 24 to 12 billion for 1974, we would have had this 11 billion growing to 19 billion when you add in pay and price increases and the other upward pressures that are on all these programs.

So we would have had outlays of 288.

and a deficit in excess of $35 billion for 1974.

And we would have sailed right on up to $12 billion in 1975.

Now, these aren't new programs.

These are just the additions that an $11 billion addition in 1973

reduces when you project it out without any additions, just a continuation of what these extra things mean in that year.

So by cutting back about $11 billion this year, they get to $250 billion.

We remove that, and we remove that, and we are able to keep in a $12 billion deficit in 1974, and very close to, if not right at, actual balance in 1975.

We will have, on our projections, a very small full employment surplus then because we expect to be just about at full employment in that year.

But as far as we can tell, we will be very close to actual dollars.

We will have removed all of the inflationary and tax requiring pressures by this action date in this year.

So there is a lot more to it than just the outlays this year.

Actually, as you'll see, and I'll go through these reductions in a minute, some of the specific ones,

You don't get all of that saving this year, but the time to start saving money in this kind of a system is three years ago.

And you have to start sometime.

So by starting now, by hauling this down to 250, which is going to change your undertaking, you get all of those dividends in the outer years if you consider as dividends the elimination of the need for a tax increase and the elimination of tremendous inflationary pressures on the economy.

Now, I can go through very quickly some of the major reductions and terminations.

And we have these laid out at about a six-page table in the budget document without any attempt to conceal anything or hide anything or phrase it differently.

And there are pretty good justifications for almost all of these.

Yeah, if I ever censored that 24 video, I guess George still wouldn't ask.

It's true that the tax increase was not...

If we were to ask for $24 billion more in taxes, how much would that be in terms of tax percent?

Well, we collect on the income tax about $100 billion right now.

So you've got to know it would go up a little bit in the next few years, 20% say.

So what we're really looking at is 20% increase in income taxes are holding the line.

There are two or three major areas of reduction.

And when you realize that starting as we head into the fiscal year, about all you can look at in a budget of $2.3 billion, to find any room at all where you can make any reductions is approximately $40 billion.

You have to make all your reductions within a set of boundary lines about $40 billion wide.

And from that, we made actual programmatic reductions of about $6.5 billion.

And the balance are things that involve shifts from year to year, sales of more assets, taking in sales from stockpiles, and things of that kind to get us into this $11 billion range.

so that you do have somewhat more of what appears to be a range of specific programs when you start later in the fiscal year.

And another reason, that's another reason really for considering not just 74, but a very detailed look at 75, so to see what those boundary lines are if we want to avoid taxes in those years.

Some of these reductions will require major legislation, those will be fixed too.

And they will not get as much off-place savings in 73, but they will in 74 and 75.

And these would be to eliminate and change some of the federal financing provisions in Medicaid and Medicare, get some cost sharing in so that we can discourage

over-utilization, which is one of the things that has caused so much there, and to get some changes within the pension letter for the Veterans Administration so that you have much more emphasis on need rather than on just automatic payment.

A lot of the other items for the reductions have been made.

There will be, just running through these very quickly, substantial reductions in foreign economic assistance in the sense that we are going to get amounts brought back much sooner, repayments, than would otherwise be the case.

In agriculture, there will be reductions that are possible now because of the increase in

farm income and the lack of need for export subsidy.

So that we can in those two areas get about $656 million outlay savings this year.

And by substituting regular loan assistance for emergency loans in some of the counties.

where the program had gotten pretty well out of hand, additional savings can be made.

This is a very difficult question area.

What it is really is to eliminate the extremely liberalized loan provisions in areas that have been administratively declared an emergency situation.

You have now still the opportunity to get loans.

Most of these are in areas where the so-called emergency or the declaration of emergency was in effect for over 60 days.

and a great many of the applications were already in the process and this is an attempt to try to eliminate some of the abuses that were encountered in one of the emergencies uh some years ago in los angeles earthquake where you had contractors placing ads in newspapers uh urging people to come in and get a free government loan with forgiveness under five thousand dollars because there were

If they had any cracks in their plaster, this was a good way to start getting them fixed, and we had an enormous increase in those loans as a result of that.

There are some hardship situations here, and we're making every effort to try to amend them together in a way that will eliminate real hardship situations, or where sometimes one will connect with seven.

But that is one.

The other one is the rural electrification loans, where we've been having 2% of the money for a very long time.

Eighty percent of that money goes to non-farm purposes.

Non-farm purposes.

Eighty percent.

Suburban developments, country clubs, recreational areas, things of that kind.

So there's plenty of economic justification for eliminating the two percent.

But as all of the members know, as I know, long experience is one of the most vicious lobbies you'll ever run into.

matched only by the REAP, which is the Rural Environmental Program.

And that lobby is also very tough.

And again, that program is one in which applicants for the program are paid to pursue practices that most of them are doing anyway or would do anyway.

And the limestone industry as the president indicated is the bigger beneficiary of that.

Agriculture is not the only one.

A lot of reductions.

It spread very well across the whole government.

And the health insurance for $3.1 billion in outlay savings to 73.

Agriculture, $1.2 billion.

The transportation, $300 million.

Just running through some of the numbers here quickly.

Environmental Protection Agency, $300 million.

and others up to a total of $6.5 billion.

And that is the actual programmatic reduction necessary to bring us down to the $2.5 billion.

I think perhaps, Mr. President, the best thing would be to see if there's specific questions rather than go into any more detail on $7.3 billion.

But I just say one thing, John, before your question.

I don't get the idea, though, that everything is cut.

For example, energy is up by about 20%.

Fire is up by, there's no savers, they spend it, so it's hard to cry.

I just like crying.

We have all of those at 74.

These are all pollution, things like that.

So there are quite a few things that are up, but things that we want to get rid of.

Because after all, this $18 billion increase is not necessarily good.

all just growth and cost.

Go ahead.

Any?

As thought has been given in making these cuts, the difference between those expenditures that tend to be economic stimulus and those that are more like static expenditures.

For example, in my state, we were threatened with closing down aircraft plants because the FAA was short on funds and couldn't put the inspectors in to certify the aircraft.

well of course the government would lose more in tax revenue in a situation like that than he would say that but i'm not done like they expected this is the kind of thing i wanted oh i think so john this book which i haven't wanted to burden anyone with is the economic and programmatic justification of all the reductions that are made and we have been through it very

very carefully to be sure that what we were recommending for reductions or impounding were programs very good at White Coat.

The point that I raised, John, when we had the cat breathing on her side, I said, when I look here, we had a very good year this year.

And one of the reasons you've never been here is that our budget was basically an expansionary budget at home.

And of course, I recall very well how in 1937, we were very responsible in cutting the budget.

We had one caliber recession in 58.

and we did the same thing in 59, and we had a little recession right in October of 1960.

So the question is, George, if you would say a word in that context, looking at this budget from the 2.3 on the broader aspect,

Do you consider the budget in 1974 enough to keep the economy moving at the rate we want it to move, or is it going to cool the economy?

That we do not want.

Well, that's the fundamental point these fellows have to be reassured on.

These two budgets, which are being described as very tight, have in them after all a $25 billion deficit for fiscal 73, and about half that amount

In fiscal 74, we expect to be very close to full employment by the time 1974, fiscal 74 is over.

So that while we had the idea in the early stages of the administration that we should have a very tight fiscal and monetary policy in the interest of cooling things off some, that worked.

Perhaps they got cooled off a little more than we wanted.

We then said,

That's exactly what that was about.

The Fed's monetary policy has been

probably excessively expansive, although we don't want to get too much down the other way.

But assuming we've got an expansive monetary policy and an expansive budget policy, it's bound to go up.

The monetary policy, we're going to continue to watch that.

This isn't just a budget, it's fixed economy up.

Right.

Well, the point I wanted to make was that in the 68, 69 period,

stringent fiscal and monetary policy work fundamental we turned that around and uh the president's acceptance large deficits and the fed did loosen up a lot on the money supply and that work has been expanded and we've had a reduction in the way of inflation as it's been expanded now we've come to the testing time however

When we get toward full employment, and we can't just relax and say, a deficit will help expand the economy, a deficit, as we get to full employment, will, as it did in 1967 and 68, explode us into another inflationary binge.

So we must hold hard on this, and these budgets are still expansionary.

I think, Mr. President, it is an interesting fact that in the history of the efforts of countries in the Western world,

to have full prosperity in peacetime with reasonably stable prices.

There is a correlation between the extent to which those countries have used incomes policies of various kinds and the rate of inflation they've experienced.

That is, the more they have used incomes policies, the more their inflation rate has been.

It's a very direct quarreling.

And it's easy to see why that is.

And I think it clearly is because, as people say, now that we have this wage price system, whatever it is, we can be relaxed about the budget.

And the wage price system will take care of the problem.

And the absolutely unambiguous experience is that when the fundamentals go out of control, the wage price system

Even in small countries with very homogeneous populations, there's labor and management all able to work cooperatively and whatnot.

They can't hold them.

So it is just extremely important to maintain this budget stance and to keep a reasonable control on these expenditures.

Mr. President, one of the people on Capitol Hill, one of the Democrats particularly, is the legal writer and columnist, the executive assistant to my person, my mother's, too.

I'd like to turn it down, but who's being accountable?

I'll take the time to address that subject for a few minutes.

It might be a little hard to say, but unless Eric's here to catch up on his speech, he's going to have to burn out the news today.

Thank you.

Well, Mr. President, let me just say that I need to get this.

Talking about the REA, I think you're going to sign off on the final analysis that the REA wasn't going to take too much money.

They don't like it, but I don't think they're going to.

That's not going to be too big a hurdle.

Well, I think the thing that John concerns me just a little at that point, which when I saw the 38, I flagged it right away.

What about this?

They say, well, 80% of them are not foreign persons.

That convinces me.

I mean, I don't see why the countries love them.

Jock put me in those clouds without having to have a ranch.

Raising mistresses or whatever the hell it is.

Oh, sir.

I don't see Jock.

It's not you that has the heart.

I'm sorry.

Jock's got the heart.

All right, Mr. Mike, Mr. President, Mr. Vice President, and gentlemen, you would think that

Over a period of 200 years, it's been a matter of raising controversy that there would be an abundance of judicial decision and determination so that for a lawyer to talk about the legal justifications in common would be just like a foreign book of law.

Strictly enough, there's only one decision of record, and that was in 1838.

And that was somebody who wanted to implement a contract

in the Post Office Department that was specific.

Other than that, there's no judicial decision.

And I think that the reason for that is probably plain, and that is that presidents have always empowered you.

They've always had to, and they always will.

And that, taking into account the nature of the presidency, the Congress, their separateness, and also their mutual dependence, it's been

Ultimately, a political question.

Quite frankly, there are two cases in federal district courts right now for the first time in 200 years that in a way is litigating this issue.

If those cases proceed, and I'm inclined to doubt that they won't just because they're going to exhaust themselves, we probably will not have those finally determined by the Supreme Court of the United States.

President Jackson.

It was utilized and arched by President Roosevelt, refined by President Truman, President Eisenhower to some extent, but significantly President Kennedy and President Johnson.

President Johnson's entitlement of the Highway Trust Funds.

If there was ever a fund created by the Congress, set aside out of monies collected for a specific purpose, with a specific mandate, I don't think we could pick out one that would be more in point than the Highway Trust Funds.

I really doubt taking into account the

the specific nature of specific legislation and the overall responsibility of the President, if the Congress really could mandate the spending of a particular dollar under all circumstances.

When you take a look at any, even if they use the magic word shall, and put that in relationship to let's say the debt ceiling limit,

or the Anti-Deficiency Act, or the Constitutional Obligations of the President against foreign relations or defense,

even indeed the obligation of a bureaucrat and the executive branch of the government to see to it that monies are properly spent, that is to say that there are resources available to people, machines, the means by which you get the job done, or you throw the money away, and if a bureaucrat throws it away, he goes to jail.

And when you compare the whole

legislative structure in its generic form in a general way and put that alongside of any specific piece of legislation that would on its face appear to mandate that a particular amount of money be spent.

I think that there is the greatest difficulty in coming up with a situation that would absolutely mandate spending on the president.

In addition to that, presidents have, in more recent times, particularly as a result of the impact of World War I and World War II, found it not only necessary but absolutely imperative that money should be accounted so that the executive could have some general control over the economy, finance, inflation.

the main responsibility, constitutionally, of the President as distinct from the constitutional authority and duty of the Congress to raise money.

You're really in a situation, so far as lawyers are concerned, which is a field day for them, because no matter what side of the question you want to be on, constitutionally, your guess is just as good as anybody else.

But I submit to you, gentlemen, and thank you, Mr. President,

that this matter probably will never be the subject matter of definitive constitutional law by the Supreme Court, because it's essentially a political matter, and it always has been, and the political nature of it derives really from the separate but nevertheless mutually interdependent function of the executive on the one hand and the Congress on the other.

I recall one incident when you were the jury, Josh, and you were called to Texas.

I remember the 70s in the Air Force, and we were on the other side.

And all of us were trying to get Truman to spend the money.

We raised all of it.

And so that one was 40 to be in the Dove, and he was for it.

You overrode the veto.

What?

You overrode the veto.

But what happened on that one then?

He didn't spend the money.

Even with that, he didn't spend the money.

Would it be helpful, Mr. President?

That's the one, if I could say, that's what I'd say right now.

I think he was wrong to do that from a national defense standpoint.

He had an election every four years.

Nevertheless, from a constitutional standpoint, he was in the

The whole world was reversed.

Republicans, we say Republicans draw the best men, combined with many Democrats, who was drawing the best people.

Drawing them together.

Say, my golly, spend the money.

And Truman said, I won't do it.

The buck stops here.

And nothing happened.

I told him, Kenny, likewise.

Just don't crush those things off for me now.

Mr. President, it would be helpful if we could have a talking paper.

Going back to Truman and have illustration A, illustration B.

Could I suggest, what you said today is that very victim is free and so forth.

Could I suggest in terms of a talking paper, the fallout you learned previously?

make it concise on a couple pages so you know they could just read it quickly and get it to mind.

I'll try to read it.

I would particularly get the Truman one because virtually all of us remember that.

We've been around a bit and most have read about it.

And it was a perfect point.

We were on the other side.

He looked out.

I mean he empowered.

And not a damn thing that he said.

Right.

You know, as a clear example of the other side.

Now, we're inbound in Mexico.

But isn't it true that the strongest point of the government campaign last year was that he was going to impact defense money?

He would not.

Oh, yeah.

Oh, sure.

It depends on who you're accounting.

That's right.

It depends that you don't impound something for subsidizing associate professors at MIT to work on defense contracts when they're...

We're going to stop that nasty stuff too.

They supported the county, Mr. President.

Mr. President, I think it's more important than the legal argument here because the general public, they don't think it's a good thing.

Mr. President, I think it's a good thing.

A lot of the boys were caught short.

They were out on the cutting edge in the accounting game, and they would like to be supported in the administration.

So we need to be armed with that kind of thing to talk to our constituents.

The White House doesn't really care about the leadership.

Mr. President, on that line, if I had one word, I think that John is exactly right.

The problem is to bring a whole precedent.

But the public doesn't.

That doesn't mean anything to them.

I get a lot of letters about this matter of Congress reasserting its role in government and recapturing the powers.

I just sent out a report on that, hundreds of thousands of them.

It simply said that Congress won.

had been passing on to the president, we didn't pass your bill.

It finds up to me.

He passed two bills.

We didn't have courage enough to hold them down.

We knew they were too much, and we received passes and sent them up to the president.

And Haskins got X percentage, where he saw fit.

That's the ATW bill, as most colleagues might have said.

Sure, certainly.

you were cut the first time and two years later we sent it out and you vetoed it.

Nevertheless, that was Congress asked the president to cut and then complain and say he has no right to.

And then I went on to say that the president can't levy a tax.

He asked for one, he can't levy one, although the president can be asked for that power, which wasn't given to him.

The president can't exceed the debt that he can ask for to be raised.

Only Congress can raise it.

And if with a debt limit and no power of tax and Congress proceeds to send up a budget and there's not enough money to pay it,

Uh, how can you reproach the president for not spending money he hasn't got?

What do you think?

Well, my report led the way, and I said...

Send all copies of yours to, uh, of your newsletter to, uh, who you get in all of them.

Uh, yeah, send it all.

I, uh, I read it.

I read it.

and get that kind of language, that very simple kind of language, but please circulate and send it also to your colleagues.

Coming off the statement that George Schultz made about the problems involved in

the necessity of getting one of these budgets down and the problem is you have such a difficult time

And so you do have a very little place in order to take it down, and you no longer need the stimulation.

That is one of the .

Now let's show one of the reasons, one of the other ways we've been simulating in addition to expenditures, we have been simulating by reducing taxes.

And the individual income tax has been reduced by just about $25 billion a year over what it would have been if the rates in 1969 had stayed in effect.

So there has been that degree of reduction in individual income taxes since the

since 69.

It isn't all one way because the payroll taxes have gone up.

Payroll taxes have gone up about 20 million, so there's been a net reduction, or will by the end of this fiscal year, there's been a net reduction in taxes of about 5 billion.

But the benefits have increased enormously in Social Security, about 21 billion over the period of benefit scale that was in effect then.

So that is one of the other stimulating aspects to the budget.

This is the rather familiar story now to everyone except the press, and that is that the priorities have changed very drastically.

The human resources expenditures, this is in dollars over here, have gone from about 60 billion

up to close to 131 million by the end of 75.

This is projected out to 1975.

Defense stays just about level in dollars, very little change at all.

And in percentage, defense is going way down.

It's under 30% now.

And human resources are about 47%.

of the total budget so the change there is a very dramatic complete reversal and it is illustrative of the different priorities that we now have this is a little further explanation of the defense i'll play 75 76 74.8 these are almost level figures

And they will count in 1974 about $4 billion.

But all of that is pay and price increases.

All of that is the amount associated with the all-volunteer armed force and the other pay increases that have been had in the military.

plus the additional .

There's no increase in activity at all.

It represented that.

As a matter of fact, there's a rather substantial decrease in the number of men that will be in the ranks.

And you can see that here.

Here, in 1968, there were 3.5 billion military personnel.

This year, in 1974, the president is requesting funds for 2.2 billion.

Now, in a very steady decline.

But this line shows the average pay and allowances.

for each person in the military, uniformed personnel.

And that's gone from $5,500 average to $10,000 a year average.

And that's where the increase has come.

in the cost of military personnel.

We have another chart that isn't blown up, but will be in the chart book.

That's right.

The payroll costs in the military now run just about 58%.

And the interesting figure we have here, it's in the chart book, I didn't have it blown up.

How much will a billion dollars pay for?

In 1964, a billion dollars would pay for 219,000 men.

In 1974, a billion dollars gets 100,000 men.

And that's the difference that has occurred in terms of inflation.

And that's why, although there's sharper depth to the fence, we stayed just about level, rather than having this big piece of land that everyone can handle.

Let me just point to you and John, if you aren't sure.

That is why any comparison of basically a dollar or a ruble, the way you want to translate it, of the amount we spend or percentage of GNP or whatever we have between ourselves and the Soviet Union is totally irrelevant.

because when they put, say, $70 billion, shall we say, equivalent into defense, if they put $70 billion into defense, my guess is the amount of their personnel cost is much less because their hardware is much more.

They're buying more hardware.

We're buying more men.

We pay more for the men.

In other words, their men come cheaper.

As a matter of fact, they have a bigger, because of their greater emphasis on land forces, they have

but their costs for men are infinitely less than ours.

So this poses, when we talk about this defense thing, and this is where I'm not going to argue the other side.

God knows we've done it.

We'd like to keep it as low as we can, but you have to have enough.

You have to have enough in order to bargain.

As we go into the second round of assault talks, arresting, and M.D.M.R.

and so on, we also have to have enough before our own defense.

And at the present time, we see that number 58%.

All the cost of going to the first county.

You aren't buying a whole lot of hardware.

You're buying a lot, but not as much.

And Roy, of course, one of the bigs even though he's going to be now on the budget side of the state, we're going to get Roy Ash.

It's a real problem.

Yes, because if you make these comparisons and we go down a lot there, how much you look at our stuff, how much we've done, so forth and so on.

But you've got a huge outlay of men, women, and so forth in the Army.

Of course, you're not getting much of the other side.

Mr. President, I think we have to accept this is a price we're paying for an all-volunteer Army, sir.

Yes, it is.

Of course, let me say, I would be hopeful that none of you fall through the canvases and so forth this year.

The all-volunteer Army not having a draft doesn't mean anything to you?

Not a bad point then, besides.

It's about the same because we're reducing manpower.

If you have to pay the same amount, you have fewer trips.

And if you have more, why doesn't that choose up enormously?

But that $4 billion increase between 1973 and 1974 is almost entirely associated with the increased manpower costs, even though the manpower itself is dropping a bit.

Now, these next set of charts will show, illustrate the President's point that

Everything is down or cut.

These are all the things that increased, and they're all on the human resources, environmental protection area, national resources area, because the defenses we saw stayed just about low.

This is an age of the elderly, and this has had a long, steady increase ever since the president came in.

And we'll continue on that path in 1974.

The Social Security is a big chunk of that.

Medicare, other benefits are also keeping pace.

So that's now $63 billion.

And that's what a jump of over 57 in 1973 is.

Here's another increase, the food assistance.

Tremendous jump in this, starting in 1969, 1970.

Food stamps and school lunch programs primarily.

And you can see they just go just about straight up on the chart.

And they are now over $4 billion.

200% increase in children receiving free or reduced price school lunches.

65% increase in areas participating in the food stamp program.

They're leveling out a little bit, and that is again an illustrative of what really happens.

The headlines talk about budget slashes.

What happens is you have a small reduction in the expected rate of interest, and that's about all you can really do in some of these areas.

Foodstaff is leveling off, yes sir.

It's right in that range now.

You can see the rate of increase has gone right straight up like that, and it is recommended for a continuation of the existing program.

One of the reasons is that practically every area in the country that can conceivably qualify is already in it.

So there's, as you know, a major effort made by the Department of Agriculture and by others to get a hundred things started.

to go out and, frankly, find areas where we can give them ways and create where they weren't there.

We've done both.

So there it is.

And now we've got to get to do something.

And also, you've got to remember this, too, as the economy has become

I guess without bringing up an unpleasant subject which we are not willing to talk about yet, when you look at the whole problem of welfare reform, you're either going to have to do something about welfare reform at some point,

Or you're going to continue to have some necessary demands.

Four billion dollars.

Instead of when we came in, maybe it was about a billion.

How much?

Sixty-eight.

Sixty-eight?

Under a billion.

We have boosted up that much.

That's up.

We've added four billion dollars to this program.

Okay.

Everybody's feeding the hungry and the poor and so forth.

But you see,

Wouldn't it be better, this is just a big question, but wouldn't it be better thinking of our philosophy to have a program rather than handing out these things, which, of course, might be the same thing, but it would be much better to have a program in which you can take care of those things.

they had decided that it would be better than giving up on the same person.

I think the great shortfall in the public exposition of our side has been

that we are not particularly hammered away at the fact that this administration has done more in all of these fields than any previous administration.

And if we hammer the categories of charity, we can help to drown this democratic cry more and more and more.

My answer is that is just what we did as far as the people can stand it.

We have been, the problem we have as Republicans, and most of us, of course, as Republicans, along with some Democrats, as basically what we would call intelligent conservatives, the problem we have is that we put the emphasis, we always do, on the economy growing, the private sector, and on responsible budget policies.

In other words, we talk about the fact that, to the extent that our Democratic friends

that they sometimes spend less and we spend more and we spend less.

And the reason is that basically that we see the needs.

We deal with needs.

We deal with them very generously and we have.

But on the other hand, deep down, all around the table, particularly the more united audiences we generally talk to,

We have people that sit there and they are too keen on some of this stuff.

They're more interested in balancing the budget.

They're more interested in no new taxes.

They're more interested in seeing that the private sector

is not stuck, as much money as it sucks out of it, that it doesn't continue to grow.

So when it comes to you, to this whole, to the earth, the point you have made of generosity and the food stamp things, and the civil rights program and all that sort of thing, a lot of our Republicans just aren't about to get out and brag about those things.

Is that true?

The more we agree, the more hopes we have.

Right.

First is, I think,

We understand exactly what you're saying.

The way you do the thing is very important.

On emergency aid, for instance, if there are abuses of government, I hope to move against the abuses and not just shut it off for all people, whether or not they were intended to be covered by the act.

That's one of the problems we haven't met, and I suspect there have been some serious abuses that have come in.

Second thing is, I think it's also important what you call it.

The Democrats are talking in terms of impoundment,

And therefore, it's difficult for them to see why deferred expense means a saving next year.

They think of it as simply making the snowball bigger next year.

And I think we've got to talk more in terms of cuts and less in terms of impoundment to counter this talk that you're just following the manipulative role here to get a better result this year.

Well, I think there is a point to be made there because they're talking all in terms of impoundment.

The third thing is...

I think that's what it means to most people and that's what they're talking about.

And the third point is I think there's very clearly a sound majority out there that's concerned about inflation and that we've got to talk to to keep the special interest from nibbling on this.

All the talk is about how the poor REA people are being starved and the school children are being starved.

Somehow, you know, you've got increasing credibility as a tough president who does what's necessary.

And the American people support you in that.

They want to see that the government, somebody, does what's necessary.

So I think you've got to talk to them a lot about this, just as you talk to them about what's necessary in the Vietnam War, because you do have people who support you on that.

The only problem is that they don't hear this talk.

They allow themselves, again, to block off areas of concern in the special interest areas, and we wind up being nibbled to death.

I think the president is under pressure.

The greatest point that he has made, and he has said good, the Democrats talk about using the word impound.

And we let ourselves use that word impound.

Now, the man on the street says, if you impound something, you've got it.

This is the money that you're hoarding.

Actually, you know, impounding because there's nothing there to impound.

You're simply not spending money you haven't got.

You're cutting the budget.

You're cutting it.

So that somewhere you have to...

I think there's a way to change that.

I think you're absolutely right.

Mr. President, this has been a, Senator's actually right, it's been a democratic word.

The first time it crossed up was in some of these reporting requirements.

You have to report all impounded funds.

it's never uh it's never been a word we've used but it is now gotten into the public vocabulary i agree i think we can can uh simply refer to them as what is the best word budget savings what about those things as a highway trust fund though when you start saying you're going to cut something that's been put in trust it's a little lucky

That money just continues in the fund, and it is just not spent.

But that's been the situation while President Johnson was the first one to do that.

The trouble with the word savings is that again, the connotation is that there's money to savings.

And the fact is, obviously, we don't have any.

We're cutting .

I think what we simply say is this.

We have cut.

We have cut the budgets that the Congress has sent to us back to $250 million in order to avoid a tax increase and in order to avoid a price increase.

That's really what you get.

Now restraint is always a good word because it means you're holding back something excessive.

And Mr. President, may I just mention the other side of it?

If you say you're cutting particular programs, the connotation is that you're against those programs.

Now, the Democrats are going to beat us to death because they're going to say, oh, the Republicans are against education, they're against this, they're against that.

And I think the image we should try to get is that

We're not against these programs.

We're for fiscal sanity.

We're against inflation.

We're in favor of trying to get the housewifes billed.

Our issue must be in the box that the spenders are for a tax that is right and therefore a price increase.

I try to put it this way and I think I say the greatest threat

to 1973 being the best year ever in America is busting the budget.

That's the greatest threat.

It threatens your job, it threatens you with higher taxes, and it threatens you with higher prices.

We're going to fight that battle now and beat that threat.

And if the issue is fought on the basis of whether we're going to have higher taxes, higher prices, and more unemployment,

Which all of this will lead to, as it did in 1968, if the issue is we're going to have limestone for this group, and we're going to have our A&T bones for this group, and we're going to have a passion area for this group, and so forth and so on.

I just don't think we're going to get in the position to argue each step by step.

What taxes do you want to add in order to pay for those $250 you want to add?

What tax increases do they recommend?

Then it puts that in the box, the spenders of

tax increase or a price increase.

Mr. President, could I add this?

That is that you asked the Congress in the last session to share this responsibility with the Senate State Insurance.

And although we didn't end up passing the bill, both houses agreed that $250 billion was the right figure.

Congress could have had a lot to say about this by not needing more than $250 billion available to be spent.

And if they had done that, it wouldn't have left to you the choice and the decision to make.

We're not bad.

Obviously, Congress has got some work to do.

Well, Mr. President, we've started on that.

I don't know how far we'll get.

We do have that committee, joint committee, and it is talking sensibly at this point.

Another spending ceiling will be requested in the amount of the 74 budget, so there will be an opportunity right from the beginning to get into that.

Bill, I've got several more of these.

These are all upward trends.

Every one of these.

This is Medicare Veterans Hospital admissions and outpatient visits.

This is additional funds for civil rights activities, minority assistance, and enforcement.

Both going up very steadily.

And when you see those figures, it isn't all just for, shall we say, enforcement.

Well, a lot of them is that.

What is that top number?

3.2 billion.

And let's just take a look.

People are interested in the civil rights image, and I would trust some are.

1970, you got 1.1.

Now it's 3.2.

So we don't care about civil rights?

How can they argue that?

Right?

Right.

Yes, sir.

No, these are all parts of this $18, $19 billion increase.

And these are all in these fields where we continually get counted as not caring.

Every one of them, the veterans, the food assistance, here's the reduction of crime.

May I interrupt there just a minute?

That minority assistance, can you have a footnote to identify that?

Yes.

It is in the chart book.

It is broken down as to what all of these are and the exact dollar amounts and everything.

That's at the back of this chart book.

And it is pretty useful.

Here's the environment.

Bear in mind with this, this tremendous account right up here, pollution control in the basement.

That's a signal of the reduced tollways that the president's authorized under the Clean Water Act.

If the full amount were there, it would be completely off the table.

You'd have to have another chart all the way up to the top on that kind of scale.

So that, again, if you could just look at the rate of entrance when we came in,

Well under a billion, about just under 500 billion.

Now it's over two and a half billion.

And that again is in a field where the other side really claims to have a monopoly.

Here is in agriculture, farm income almost straight up, tremendous increase.

We're now able, as a result of this, to allow the private company, in a sense, to take over and withdraw some of the price support.

And some of this inventory, this tremendous storage bill we used to have, is way down as a result of that.

And here, on urban transportation, again, the free city increase, slowing down a little bit, but still an increase, over 200 million dollars additional this year.

And here is the reason why we feel it's quite impossible now to stop and look at the housing program rather than just continue them.

The standard housing, people living in standard units and standard housing has gone way up.

Substandard housing has gone way down.

And the amount of federally subsidized housing has been

going out quite subtly all this time, 1.2 billion units in 1970 and more now, will still spend out well over $3 billion before the housing program, even though there is to be a temporary suspension while we look at it.

Now this is again an answer to mayors and governors and others.

who may think that because of general revenue sharing, we've trimmed down everything else.

I do not.

We have added the $7 billion, $6 billion general revenue sharing, but the others are also.

So that you have now grants to certain local governments that are in excess of $45 billion, and no slowing down as a result of general revenue sharing.

That is laid on top of all the rest.

Is that because it's so complicated ?

I'd be glad, I know, Captain, to really ask you to agree with any members of the House, certainly the Senate, on this, you know, you've got some of this fairly quite complicated.

I forget, but you have a receiving right.

Yes, we do, and we also have the books that will go up today, and I think...

It not only has these illustrations, but it's got the actual dollars and the breakdown in the back.

And of course, all the other formal budget documents will come up.

We have the budget brief again that tells the story in much shorter terms.

And we also have the special analyses and the huge appendix.

And we'll be glad to deal with specific questions in any way that would be most helpful to you.

Mr. President, can we have the official photograph now, you think?

I don't think you ought to say, or stress, that revenue change, in addition to all that we've been given before, because that's the whole premise of revenue, by and large, is an interaction and a substitution.

I agree with you.

Our goal, of course, is to

and take some of these things for reference to them, take some of these things out of them so that comes with your making is the reference you're supposed to carry.

Well, in 74, we will be recommending special revenue sharing, 400, and they will consolidate.

I have a team sergeant's driver election.

I can slung your hair, John.

That's horrible.

Your hair goes away.

Slung your hair.

All right, gentlemen, I'm set.

All right, one more.

I think that's what you're trying to do with the original radio speeches.

I'll be doing a number of things.

You see, we use various devices.

I at first thought that I would do the television on Sunday.

But the Vietnam Settlement this week and the Vietnam Settlement last Saturday just put so much out on that television and then people said, hold on, what is it?

We'll go radio on Sunday and then we first will have a follow-up after the battle is joined.

for two or three weeks, or something like that.

That way we can come back with policy.

Of course, we'll also use the .

But I use every device that's there as public support.

But even though that was a closeout, that was very, I was trying to do a comment .

It does seem, in the more simple terms of Bill and others' suggestion, I mean, I don't use the word council, for example, because I don't know if the town meeting is where I put the other things.

But I know you're trying, I know that, I know that it's more important than always, but you've got to go through these documents, more important than sort of the general concepts.

First, this is a very generous book.

It's a very generous budget with a television deficit.

A deficit in terms of what most of us used to think were deficits, not in terms of board funding.

It's a very generous budget.

And second, as far as those cuts that are made, every one there's a reason for.

And the reason in most instances, they are programs that either haven't worked or programs that no longer are necessary for them to be justified as compared to the other needs.

And third,

we have to remember is that this is not a battle between the Congress and the President.

It should not be looked at that way.

It should be a battle between Congress and the President fighting together.

I don't know any congressman or senator who ran on the platform of raising taxes.

Not one.

I ran on a platform of no increase in taxes, right?

All of you did if you ran this year.

So what we're really talking about, this is a no tax increase budget, and it's a no price increase budget, and it's a continued new prosperity budget.

It's for more jobs.

no higher taxes, and to stop the rise in prices.

To me, it doesn't mean we're going to stop the rise in prices, but at least no further increase in the rise in prices, if you want to be more specific.

But if we can keep the bet, if we can keep the game pretty much on that, if we can keep the debate on the basis that, well, yes, this is winning,

I haven't been asked myself for these individual programs here, but I think you've got to constantly be on the offensive and say, all right, that's a pretty good program.

Let's concede that for the moment.

Let's concede that.

But the real question is, as a member of the House, as a member of the Senate, you've got to think of the whole country.

You've got to think of every individual in this country, not just those special interests that are going to be, that's the way I cast it, those soldiers, because every budget cut that we

and does help some special interests.

But let's take it back to the school year.

I know this is what John and Mary talked about in Texas, in Dallas, which is pretty good.

But at the present time, you showed your community that doesn't want a federal installation in Iowa's money.

Unless, of course, it's trying for something like that for people who are scared to be faculty.

But I kind of speak to a general sign that communities now want better institutions because they need more jobs, they need more payrolls, and they need everything and better schools and the rest.

At the present time, in fact, schools need money.

500 million dollars a year, about 90% of that, about 90% of that, if probably not more, goes to the richest school districts in this country.

Now that's making sense.

We'll probably lose this, I'm going to be quite candid, we'll probably lose this because the educators are being all over us.

but is it doesn't it make sense to use the 500 billion dollars in education dollars for general education purposes for schools rather than for them is the time to fight that bullet now there was a time during the war i know there was a time when you load in a lot of a lot of transients and the rest of the system property residents

They'd come and pour into this ground.

They put a terrible burden on the school district.

So they had to build a new gym.

They had to hire more teachers and all the rest of them to help them.

We all understood that.

I've always supported it.

But in this instance, it's one of those programs that now, as we move into

Another thing that's a good line I would say, this is what you would probably call it.

I would call it, and to make two points here in a subtle way, that every sense of the word

This is a true peacetime budget.

That makes the point that we're spending more for human resources than we are for military resources.

It's something which some people agree with, but nevertheless make the point that it's a peacetime.

And it's also a budget which is designed to continue in the prosperity.

I would also, in terms of frightening people a bit,

point out that your prosperity, your job, your taxes, your family budgets, your prices are drowned by

If the federal budget is busted, it really will threaten the prosperity.

It risks the price increase.

It will bring, lead to eventually a tax increase.

And of course, it risks what exists for prosperity.

It risks more unemployment.

So really the question is, bust the budget, fine.

It'll satisfy a special interest.

Hold on to the budget, what are you going to do?

You're going to satisfy millions of Americans who pay taxes.

They don't want any more taxes.

You're going to satisfy billions of Americans who want to hold the line on prices.

And you're going to satisfy millions of Americans who want a seceded economy and continue to move up sound.

and their jobs and their prosperity.

That's what the prosperity movement is.

Yeah, you can say that again for the first time in 10 years.

That's a rather significant time.

This is the first time any president has met with leaders.

We can't really say that until tomorrow.

Tomorrow at 7 o'clock, what you can say, this is a rather historic moment as a matter of fact.

It's the first time in 10 years that the President has said in this chair meeting with his leaders, could say, gentlemen, we're meeting at a time of peace and prosperity.

We used to say that back in 55, 56 last year.

Now you can say it again.

Oh, it doesn't mean it's all that easy.

Peace is fragile.

It's always fragile.

and prosperity was not the way.

and it starts various forces into the out of line and the food price thing and so forth and so on.

Therefore, we have to take off some important cheese and that raises a lot of Wisconsin and cattle and that raises a lot of through the west and so forth and so on.

On the other hand, why do we do that?

Well, there are a lot of cheese producers and a lot of cattle producers, but a hell of a lot more people that need cheese and buy it from cattle and produce it.

We've got to think of them too.

That's really what we're getting at.

And the farmers, let me say, let's say one thing about the farmers, because I'm not.

I all, I know, and all of you know, that that's the Republican heartland.

And it proved itself again to be the Republican heartland.

Now, not only in the north, not only in the Midwest, and in South State Illinois, and in the center of California, but in the South, it's our heartland.

And therefore, while there are only about 5 million of them, of course there are 25, perhaps 5% of them, perhaps 25, a third of perhaps the country thinks in terms of farms and so forth and so on.

We don't want to do anything that they're not part of it, but let's look at the farm of the day.

Let's look at, really look real close with our opening of the new market to the Soviet Union, with our new deal with Japan, with our exports to Western Europe and the rest.

The farmers have never added to the good.

That's what we ought to emphasize.

Right, Dustin?

Right.

Would you like to be growing wheat?

$100.60 in the bush.

Right.

And why is it?

That is one of the dividends of the new Warren policy that we have.

Who opens this up for us?

Let's open it up.

I don't say that out loud.

I just say it.

I know that's the stuff, and I know that on an individual basis that you, and I would hope that the leaders when they take the front on this would fight and fight and do it.

It's quite a game.

As far as your members are concerned, you're going to have a lot of them, and particularly guys that are going to come up that will say, listen, look, you're there and you're aware.

We understand that sort of thing.

But what you have to do there is to simply say, you've got to look at the whole picture.

Don't put it in terms of, I don't know, if you need to put it in terms of, well, that's the board and the president and all that sort of thing.

Because basically, there are just lots of members of the House of Senators, Republicans, Democrats, who think they do better by going their own way, not supporting each other.

I wouldn't put it that way.

But I put it this way.

The only way you appeal to anybody, and that includes the Republican Congressman, the Senator, as well as the Democratic Congressman, is his self-interest.

And his self-interest, in the long run, is going to be better served by being against higher taxes or higher prices

than it is by being for one of these programs that we're talking about.

That's my view.

That's the only way you can ever talk.

It works.

Once in a while, it would help, though, if some of the budget figures were cast in political terms to be illustrated.

Well, you make that impact, Dave, because of the various districts, which you did, like Montgomery County.

Why don't we say, we're taking $500 million out of the African suburbs and putting it into a special program supported by William County School of Education.

We are going to increase that funding.

As sure as the world, you have to put your money there.

Well, in March, there was a March bill that I didn't put in quite as directly.

I'll send you a copy of it.

But what I had is, I made that very point.

I said, this goes to the richest districts.

And I did that $500 million better to use for other educational arts, which is where they need it.

And that's really true.

Because we're not against education, we're for it.

It's like, as I said, it's, well, it's a, it's a, there's going to be someone who's going to just raise hell with me.

So I'll raise right here in the morning.

All this is embargoed for a while because I, we're going to have, hell, let's have it Monday rather than Saturday.

Now, the point is that, you know how much we get in higher education.

It's shameful.

Utterly shameful.

For a reason.

that we are subsidizing higher education primarily through defense funds.

The Department of Defense, now where does it go?

It goes to the university or the college or whatever.

And the university and the college, what do they do?

Well, they jack up the salaries for their associate professors and instructors and the rest, and also give them expenses so they can march on Washington and protest against defense funds.

except where it comes to help their salaries.

I haven't heard one of the Ivy League residents come in here and say, look, won't you cut back on our defense money?

Oh, they want the money.

Oh, we need that.

Oh, you will cluster.

But what should be done?

Should we just cut it out?

Not help parents?

Hold on.

You know what we ought to do?

Help the students.

That's what we're doing.

The money is going to the students.

They're going to get it.

Every college president in this country who gets the lunch is going to raise hell and I will be the fellow to stand up and say, all right, kids, if you want the money, get the students in there, let them take it, but get the business of subsidizing universities, et cetera, and then have them be so magically irresponsible

that they, or even the biologists, they believe, take certain kinds of defense activities because it's morally abhorrent.

And others, they take them and do them badly.

Well, that's going to change.

Our activity, payroll, was civil college.

I was shocked to see that 90% of the professors' faculty were subsidized either by the federal, state, or the government.

Writing essays, and so on.

90%.

That's Einstein and Nagel.

Well, I feel that we are all, basically, we want to remember higher education as one of the great assets of this country.

Shall we say, my view, I know it's not religion, but in my view it's consistent with our philosophy.

Our philosophy was supposed to find, in other words, it is a philosophy based on why do we need education?

Why, for example, go to the educational institution, and they all don't get it.

There are a lot of don'ts.

Why not the student, unless the student is traveling, which will be the only schools in the country.

Rather than have that determined by government, by who they subsidize.

President, I have a hang-up on this, so don't take my word for it.

We've got some here.

Say, okay, we just don't agree.

President, I spent my year of reading, and I know I'm too late for another one.

Yes, I have one point that I want to make.

You know we had the office and he did a splendid job.

We wanted to keep him here, but for personal reasons he had to return to South Carolina, although he will be available for a part-time basis to do assistance in some of our political activities.

Thank you.

you

The economy's good, we're making our emissions.

That's the reason, another reason, may I say to all of you that we'll have to take some lumps to the limit with this.

And it'll be tough.

And we may get some beetles over the rim.

Believe me, if I get the beetles, we have to come.

But let me say, if I take the lumps this year, we're trying to build the basis for a good economy next year, in 74, and this year as well.

the economic predictions, which Stein will cover with the bipartisan leaders.

Now, economic projections.

George, your projection is that 73 and 74 can be very good years if we have a sound fiscal policy from the debt and wage law.

Is that a fair statement?

Yes, sir.

We have not tried to project 74 because that's too far.

And this year as well.

The economic predictions, which Stein and his stuff will cover with the bipartisan leaders, and we'll do a little bit of that.

We can't do it now.

economic projections.

George, your projection is that 73 and 74 can be very good years.

If we have a stock system of policies and the debt plays ball, is that a fair statement?

Yes, sir.

We have not tried to project 74 because that's too far away.

I was just saying when we were discussing the idea of pounding and cuts and so forth,

Of course, some of this money does stay there and can be used, so that if we see in the early 74 that there is a, looks like the economy might stag a little bit, then we'll take that money and we'll spend it.

That is, we would appreciate that whole thing.

This is the time to keep that belt tight so we can have a good year in 74 and beyond that.

But if they have a mic, don't eat these things.

Alright, we'll see you at the next channel.

Oh, that's alright.

you

This will be here for that.

Well, I think you can move it closer to the table.

It's probably better.

It's awful.

I think it's horrible to be on something else.

Well, I don't know any other way to... We can play it down there.

Yeah.

We can put it over there.

All right.

Let me get the order.

We can move it over there.

It's awful heavy for all the music.

Just wanted to add one question.

Yes, do you want the drink to go?

No, the sun is just coming through.

All right, so.

Fairly close to the table.

Right there.

Another problem with this is,

The president sits here and can't see.

So, maybe, how, if we got it out here, where we can at least face up to it.

Yeah, that's why it's always on the other side.

There we are.

Well, I wonder how big of a .

Well, at 1110, if you're right in the middle of it.

Well, we can start with it here and then have somebody take it back to this corner.

Let's get it back here then.

Yeah, there we are.

I can work around it.

Come on in.

Get this chair out of the way.

I can get this over here.

All right.

Thanks a lot.

One more question.

I got that on.

Let's see how it went.

Talk about it.

Are you going to do this thing?

Yes.

Is that where you want me?

Yep.

Okay, where do you know what happened?

I think that's probably the best thing, is to get over there and he's gonna play to that side of the table.

What we got on the meter?

I just plugged the cord along there that way.

this is

You think we'll be long enough, Pat?

That's what I'm worried about, yeah.