On June 13, 1973, President Richard M. Nixon met in the President's office in the Old Executive Office Building at an unknown time between 5:40 pm and 6:54 pm. The Old Executive Office Building taping system captured this recording, which is known as Conversation 445-030 of the White House Tapes.
Transcript (AI-Generated)This transcript was generated automatically by AI and has not been reviewed for accuracy. Do not cite this transcript as authoritative. Consult the Finding Aid above for verified information.
Good evening.
I want to tell you tonight about some strong actions I have ordered today with regard to the American economy.
Actions which will be important to you in terms of the wages you earn and the prices you pay.
But first, since we have been hearing so much in the past few months about what is wrong with the American economy, let us look at some of the things that are right about our economy.
We can be proud that the American economy is by far the greatest, the strongest, the most productive economy in the world.
It gives us the highest standard of living in the world.
We are in the middle of one of the biggest booms in the history.
More Americans have jobs today than ever before.
The average worker is earning more than ever before.
Your income might buy more today than ever before.
In August 1971, I announced the new economic policy.
Since then, the nation's output has increased by a phenomenal 11.
a rapid growth in any comparable period in the past 21 years.
One-half billion new civilian jobs have been created, more than in any comparable period in our history.
At the same time, we offer Catholic disposable income.
That means what you have left to spend, after taxes and after inflation, has been risen by 7.5%.
This means that in terms of what your money will actually buy in the past year and a half,
your income has increased by the equivalent of four weeks' pay.
Now, when we consider these facts, we can see that in terms of jobs, of income, of growth, we are enjoying one of the best earnings in our history.
We had every reason to be optimistic about the future, but there's one great problem that rightly concerns every one of us.
This is rising prices, and especially rising food prices.
By the end of last year, we had brought the rate of inflation down to 3.4%, which is the lowest rate of inflation of any industrial nation in the world.
But now prices are going up at unacceptably high rates.
The greatest part of this increase is due to rising food prices.
This has been caused in large nature by increased demand, and all are wrong.
By crop failures abroad, I saw the worst weather for crops and livestock here in America that we have ever experienced.
Whatever the reasons,
Every American family is confronted today with a real and pressing problem of rising prices.
I am excited that the time has come to take strong and effective action to deal with this problem.
Infected immediately, therefore, I am ordering a freeze on prices.
This freeze will hold prices at levels no higher than those charged during the first eight days a week.
It will cover all prices paid by consumers.
The only prices not covered will be those of unprocessed agricultural products at the farm level and range.
Wages, interest, and dividends will remain under their present control system during the brief.
The reason I have decided not to freeze wages is that wage settlements reached under the rules of Phase 3 have not been a significant cause of the rise in prices.
As long as wage settlements continue to be responsible and non-inflationary,
A wage freeze will not be imposed.
The freeze will last for a maximum of 60 days.
This time will be used to develop and put in place a new and more effective system of controls which will follow the freeze.
This new Phase 4 set of controls will be designed to contain the forces that have sent prices so rapidly upward in the past several months.
It will involve higher standards, more mandatory compliance as a procedure than the phase 3.
it will recognize the need for wages and prices to be treated consistently with one eye.
In addition to food prices, I have received reports from various parts of the country lately of many instances of sharp increases in the price of gasoline.
Therefore, I have specifically directed the Coastal Living Council to develop new phase four measures that will stabilize both food prices and the price of gasoline at the local service station.
In announcing these actions, there is one point I want to emphasize to everyone listening to me tonight.
The baseboard that follows the breeze will not be designed to get us permanently into a controlled economy.
On the contrary, it will be designed as a better way to get us out of a controlled economy, to return as quickly as possible to the free market system.
We are not going to put this great American economy into a straitjacket.
We're not going to control the boom in a way that would lead to a bust.
We're not going to follow the advice of those who have proposed actions that would lead inevitably to a permanent system of wage and price controls.
Such actions would bring good headlines tomorrow and bad headings six months from now.
For every American man, headaches and turns, a brash new black market and eventually a recession leading tomorrow and then.
It is your prosperity, Mr. Speaker.
It is your job.
The actions I have directed today are designed to deal with the rise in the cost of living without jeopardizing your prosperity or your jobs.
Because the key to curbing food prices lies in increasing certain supplies, I have not reasoned the price of unprocessed agricultural products at the farm level.
This would reduce supplies instead of increasing them, and would eventually result in even higher prices for the foods you buy at the supermarket.
Beginning in 1972, we embarked on the comprehensive field program for increasing food supply.
Among many other measures, this has included pulling up 14 million more acres for crop production.
In the months ahead, as these new crops are harvested, they will help hold prices down.
But unfortunately, this is not yet helping in terms of the prices you pay at the supermarket today.
One of the major reasons for the rise in food prices in the home is that there is now an unprecedented demand
for the products of America's farmers.
Over the long run, increased food exports will be a vital factor in raising farm income, in improving our balance of payment, and in supporting America's position of leadership in the world.
In the short term, however, when we have shortages and sharply rising prices of food at home, I have made this basic decision.
In allocating the products of America's farmers between markets abroad
and those at home, we must put the American consumer first.
Therefore, I decided to build a system for export controls on food products.
A system designed to hold the price of animal feedstuffs and other grains in the American market to levels that will make it possible to produce egg and meat and milk at prices.
I shall ask the Congress on an urgent basis to give me the new and more flexible authority needed to impose such assistance.
In exercising such authority, this will be my policy.
We will keep the export commitments we've made as a nation.
We shall consult with other countries to seek their cooperation in resolving the worldwide problem of rising food prices.
But we will not let foreign sales price meat and savor eggs.
but we will not let foreign sales price meat and eggs off the American table.
I'm taking another action today to stop the rise in the customer.
I have ordered the Internal Revenue Service to begin immediately a thoroughgoing audit of the most of the companies, which have raised their prices more than 1.5% above their January season.
The purpose of the audit will be to find out whether these increases were justified by rising costs.
If they were not,
prices will be rolled back.
The battle against inflation is every time today.
I told you what the administration will do.
There's also a vital role for the Congress, as I explained to the congressional leadership a few moments ago.
The most important single thing the Congress can do in holding down the cost of living is to hold down the cost of government.
For my part, I shall continue to beat those spending bills that we cannot afford, no matter how low those are in their name.
These budget budgets become long.
The money will come out of your pocket.
Either in higher taxes, higher prices, or both.
There are several specific recommendations I already made in the Congress that will be important to note down prices in the future.
I again urge quick action on all these proposals.
Congress should give the President authority to reduce tariffs in selected cases in order to increase supplies of goods and to hold down their prices.
This action will help on such scarce items as meat,
In particular, the tariff on imported meat should be removed completely.
Congress should provide authority to dispose of more surplus commodity sales at governmentstop.com.
Congress should let us go ahead quickly with the Alaska pipeline so that we can combat the shortage of oil and gas.
I have also sent to the Congress a major new set of proposals on energy.
Spelling out new actions, I believe, are necessary to help us meet our energy needs and thereby lessen pressure on fuel prices.
In this consideration, through the Farm Commission, it is vital that the Congress put high production ahead of high prices, so that farm prosperity will not be at the cost of higher prices for the consumer.
If the Congress sends me a farm bill or any other bill that I consider inflationary, I shall be able to do that.
Beyond what the administration can do and what the Congress can do, there's also a great deal you can do.
The next 50 days can decide the question.
The question of whether we shall have a continuous inflation that leads to recession, or whether we deal responsibly with our present problem, and so go forward with a vigorous prosperity and a swift return to a free market.
You can help by giving your senators and congressmen your support when they make the difficult decisions to hold back on unnecessary spending.
given help by saying no to those who would impose a permanent system of control on this great productive economy of ours.
But there be no mistake.
If our economy is to remain dynamic, we must never suffer the temptation of a man that in the long run controls could be a substitute for a free economy or permit us to escape the need for discipline in fiscal and monetary policy.
We must not let controls become an art of kindness.
we must not become a victim.
There are all sorts of seemingly simple gifts that would give the appearance or offer the promise of controlling the planet, but that would carry a dangerous risk of bringing on a recession that would not be effective in holding down a crisis.
Rigid, permanent controls always look better on paper than they do in practice.
We must never go down that road, which could lead to economic disasters.
We have very much to be thankful for in America tonight.
We are the best clothed, best fed, best housed people in the world, the enemies of every nation.
This year, for the first time in 12 years, we are at peace in Vietnam, and our courageous prisoners of war have returned to their homes.
This year, for the first time in a generation, no American is being drafted for the armed service.
This year,
find our prospects brighter than any time in the modern era for a lasting peace and for the abundant prosperity such a peace can make possible.
Next Monday, I will be at the summit here in Washington with General Secretary Bresciano of the Soviet Union.
Based on the month's preparatory work that has been done for this meeting, based on the extensive consultation and correspondence we have had, I can comfortably predict tonight that all of our meetings will come major new progress
toward reducing both the burden of honor and the danger of war, and toward a better and more rewarding relationship between the world's two most powerful nations.
Today in America, we have a magnificent opportunity.
We hold the future, our future, in our own hands.
By standing together, by working together, by joining in bold yet sensible policies to meet our temporary problems without sacrificing our last stream of strength
We cannot change what America has not had since President Eisenhower was in this office.
Full prosperity, without war, and without aggression.
This is a great goal, and a goal that together we can reach.
Thank you, and good night.