Nixon White House Tapes › Tape 273 › Conversation 273-044
Nixon alone in his EOB office on New Economic Policy and Wage-price freeze
Sunday, August 15, 1971 · 5:43 PM–7:14 PM ET · Old Executive Office Building · 14 min
AI Summary
President Richard Nixon met with staff to rehearse a major televised address titled "The Challenge of Peace," which outlined his administration's shift toward a "New Economic Policy." The speech detailed significant fiscal initiatives, including job creation incentives, tax cuts, and a temporary wage-price freeze to combat inflation. Furthermore, Nixon articulated his strategy to stabilize the U.S. dollar, emphasizing the need for international economic cooperation and a transition from post-war aid to shared global financial responsibility.
- New Economic Policy
- Wage-price freeze
- Job creation
- U.S. dollar stabilization
- Fiscal policy
- Presidential speeches
Audio
This clip was extracted from the full tape recording by Easy Nixon.
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Position in tape: 04:12:51 – 04:27:24
part C, 8:52
273a.mp3
273b.mp3
273c.mp3
NARA Description
On August 15, 1971, President Richard M. Nixon met in the President's office in the Old Executive Office Building at an unknown time between 5:43 pm and 7:14 pm. The Old Executive Office Building taping system captured this recording, which is known as Conversation 273-044 of the White House Tapes.
Nixon Library Finding Aid
Conversation No. 273-44 Date: August 15, 1971 Time: Unknown between 5:43 pm and 7:14 pm Location: Executive Office Building The President rehearsed a speech entitled "The Challenge of Peace". [See Public Papers of the Presidents, Richard M. Nixon, 1971, pp. 886-891]
Transcript (AI-generated)
This transcript was generated automatically by AI (WhisperX) and has not been reviewed for accuracy. Names and numbers are often wrong; speakers are not identified. Do not cite it as authoritative — verify against the audio and the finding aid.
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Well, let's see.
It must be a very small question.
Yeah.
This will be right back.
Because they were such jerks.
All right.
Well, this will have to be about, well, if there's something important for something, you know, that I, it's a little hard to change.
All right.
Well, it's important.
I understand.
Thank you.
Thank you, Dr. Tejo.
I don't know what to say.
— 1 min 37 s with no transcribed speech —
I addressed the nation a number of times over the past two years on the problems of ending the war.
Because of the progress we have made for achieving that goal, this Sunday is an appropriate time for us to turn our attention to the jobs of peace.
After the day, it was the best opportunity in this century to achieve two of its greatest ideas.
To bring about a generation of peace, and to create a good prosperity without war.
This not only requires bold leadership ready to take bold action, it calls for the greatness of the great people.
Starting without war requires action on three fronts.
For our better jobs, we must stop the rise of the cost of living.
We must protect the dollar from the impacts of international monetary speculation.
We are going to take that action, not in a big, not half-hearted, not in peaceful fashion.
We are going to move forward with a new prosperity without war as we've been to great people, all together, and along for our time.
The time has come for a new economic policy for the United States.
Its targets are unemployment, inflation, and international speculation.
Here's how we're going to attack it.
First, we're going to sell you good jobs.
We all know why we have unemployment now.
Too many of the Marines' workers have been released from the armed forces and defense plans because of our success in winding down the war in Vietnam.
Putting those people back to work is one of the challenges of peace.
We have got to make progress.
We have begun to make progress.
Our employment rate today is below the average in the four peacetime years of the 1960s.
If we can, we must do better.
The time has come for American industry, which has produced more jobs and higher real wages than any other industrial system in history, to embark on a bold program of new investment in production for peace.
To give that system a powerful new stimulus, I shall ask the Congress to consider as its first priority the enactment of the Job Development Act of 1971.
I propose to provide the strongest short-term incentive in our history to invest in new machinery and equipment that will create new jobs for Americans.
A 10% job development credit for one year effective as of today with a 5% credit after August 15, 1972.
This tax credit for investment in new equipment will not only generate new jobs, it will raise productivity and make our goods more competitive in the years ahead.
I propose to repeal the 7% excise tax on automobiles effective today.
This will mean a reduction in prices of about $200 per car.
I shall insist that the American auto industry pass this tax reduction off to its nearly 8 billion customers who are buying automobiles in this year.
Lower prices will mean that more people will be able to afford new cars, and every additional 100,000 cars sold means 25,000 new jobs.
I propose to speed up the personal income tax exemptions scheduled for January 1, 1973 to January 1, 1972.
so that taxpayers can deduct an extra $50 for each exemption one year earlier than planned.
This increase in consumer spending power will provide a strong boost to the economy in general and for the planet in particular.
I recommend it.
taken together and drawn from the economy, which has taken place in the first half of this year, will move us strongly forward, for a goal this nation has not reached since 1956, prosperity with full employment and peace.
Looking to the future, I directed the Secretary of Trade to recommend to the Congress in January new tax proposals for stimulating research and development of new industries and new technologies to help provide the 20 million new jobs that America needs for the young people who will be coming into the job market in the next decade.
To offset the loss of revenue from these tax cuts which directly stimulate new jobs, I have ordered a $4.7 billion cut in federal spending.
Tax cuts to regulated employment must be matched by spending cuts divided by inflation through shrink inflation.
To check the rise in the cost of government, I have ordered postponement of pay raises and a 5% cut in government personnel.
I have ordered a 10% cut in borrowing and denominated.
In addition, since the Congress has already delayed action on two of the great initiatives of this administration, I will ask Congress to amend my proposals to postpone the implementation of revenue sharing for three months and welfare reform for one year.
This way, I am reordering our budget priorities to concentrate more on achieving full employment.
The second indispensable element of the new prosperity is to stop the rise in the cost of living.
One of the cruelest legacies of the artificial prosperity produced by war is inflation.
Confession robs everyone.
The 20 million who are retired and living on fixed incomes are particularly hard hit.
All men find it harder than ever to balance the balance of money.
And 80 million wage earners have been on a treadmill.
For example, in the four or four years between 1965 and 1969, their wage increases were completely eaten up by price increases.
Their paychecks were higher, but they were no better off.
We have made progress against the rise in the cost of labor.
From the high price of 6% a year in 1969, the rise in consumer prices has been cut to 4% in the first half of 1971.
But just as in our fight against unemployment, we can and must do that.
The time has come for decisive action to break the vicious circle and spiral through our prices and costs.
I am today ordering a freeze on all prices and wages throughout the United States for a period of less than 60 to 90 days.
I called on corporations to extend that wage-price treaty to all evidence.
I have today appointed a cost-overlay counsel in the department.
I directed this counsel to work with leaders of labor and business to set up the proper mechanism for achieving continued price and wage stability after the nine-day freeze is over.
Let me emphasize the characteristics of this action.
It is time to vote.
To put the strong figures of American economy into a permanent straitjacket would lock in unfairness and stifle the expansion of our free enterprise system.
Second, while the wage price freeze will be backed by government sanctions if necessary, it will not be accompanied by the establishment of a huge price control bureaucracy.
I am relying on the voluntary cooperation of all Americans, workers, employers, and consumers, to make the streets work.
Working together, we will break the back of inflation, and we will do it without the mandatory wage and price controls that crush economic and personal freedom.
The third indispensable element in building new prosperity is closely related to creating new jobs, called inflation.
We must protect the position of the American dollar as a pillar of monetary stability throughout the world.
In the past seven years, there has been an average of one international monetary crisis every year.
Who gains from these crises?
Not the working man, not the investment, not the real producers of wealth.
The gainers are the international monetary speculators.
Because they thrive on prices, they earn truly.
In recent weeks, the speculators have been waging an all-out war on the American dollar.
The strength of a nation's currency is based on the strength of that nation's economy, and the American economy is by far the strongest in the world.
Accordingly, I have directed the Secretary of the Treasury to take the action necessary to defend the dollar against the speculation.
I have directed the Secretary of the Commonwealth to suspend temporarily the convertibility of the dollar into gold or other reserve assets, except in amounts and conditions determined to be in the interest of monetary stability and in the best interests of the United States.
Let me lay to rest for a minute.
If you want to buy a foreign car or take a trip abroad, market conditions may cause your government to buy slightly less.
But if you are among the overwhelming majority who buy American-made products in America, your dollar will be worth just as much tomorrow as it is today.
The effect of this action will be to stabilize the dollar.
This action will not last many frames in the international market.
But our primary concern is with American workers with fair competition around work.
To our friends abroad, including the many responsible members of the international banking community who are dedicated to stability and global trade, I give this assurance.
The United States has always been and will continue to be a forward-looking, trustworthy, and straight department.
When the unfair treatment is ended, the import tax will end as well.
As a result of these actions, the product of American labor will be more competitive, and the unfair act that some of our foreign competition has had will be removed.
This is the major reason why our trade balance has eroded for the past 15 years.
At the end of World War II, the economies of the major industrial nations of Europe and Asia were frustrated.
To help them get on their feet, to protect their freedom, the United States provided $143 billion in foreign aid.
That was the right thing for us to do.
Today, largely of our own, they have regained their vitality and become strong competitors.
Since they're economically strong, the time has come for them to bear their fair share of the burden of defending freedom around the world.
Also recorded on August 15, 1971
- 273-035 5:43 PM · 18 sec — President Richard M. Nixon and Rose Mary Woods met in the President's office in the Old Executive Office Building at an unknown time between 5:43 pm and 7:14 pm.
- 273-036 5:43 PM · 48 sec — President Richard M. Nixon and Manolo Sanchez met in the President's office in the Old Executive Office Building at an unknown time between 5:43 pm and 7:14 pm.
- 273-037 5:43 PM · 43 sec — President Richard M. Nixon and Rose Mary Woods met in the President's office in the Old Executive Office Building at an unknown time between 5:43 pm and 7:14 pm.
- 273-038 5:43 PM · 23 sec — President Richard M. Nixon and Manolo Sanchez met in the President's office in the Old Executive Office Building at an unknown time between 5:43 pm and 7:14 pm.
- 273-039 5:43 PM · 38 sec — President Richard M. Nixon, Rose Mary Woods, and Manolo Sanchez met in the President's office in the Old Executive Office Building at an unknown time between 5:43 pm and 7:14 pm.
- 273-040 5:43 PM · 13 sec — President Richard M. Nixon and the White House operator met in the President's office in the Old Executive Office Building at an unknown time between 5:43 pm and 7:14 pm.
- 273-041 5:43 PM · 7 min — President Richard M. Nixon, William L. Safire, and Rose Mary Woods met in the President's office in the Old Executive Office Building at an unknown time between 5:43 pm and 7:14 pm.
- 273-042 5:43 PM · 53 sec — President Richard M. Nixon and unknown person(s) met in the President's office in the Old Executive Office Building at an unknown time between 5:43 pm and 7:14 pm.
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Cite this conversation
Conversation 273-044, August 15, 1971. White House Tapes, Richard Nixon Presidential Library and Museum, National Archives. Audio and AI transcript via Easy Nixon, https://www.easynixon.org/tapes/273-044 (accessed November 2, 2026).