Conversation 500-030

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Come right ahead.

All right.

We're just doing the first test.

All right.

That's it.

I promise you.

Oh, you're going to take pictures?

Oh, that's fine.

I never get pictures of business after here, so I heard that's a good idea.

We thought you'd come in here to do a little more accounting.

All right.

How are you?

Nice to see you again.

Nice to see you.

We've already been talking.

Don't you have a song playing in here?

Yeah, I hear the station with the headgear.

Where's my son at, Marshall?

I don't think so.

I don't think he's here.

He's here.

Welcome Jack, what would your destination be?

I would like to support the command line.

Oh yes.

Oh, I heard about the boat.

Oh yes, I heard about it.

I heard about it.

Well, this is everybody.

Let's see.

I'll move over here to this again, so we can all see.

Well, you know, you may be the ranking man, so here.

Let's see.

I always tell the wearer's assistant to stare at the top of their head.

That's good for campers and canes.

Oh, we can't wait to be able to... Oh, we can't wait.

This is a carrot.

He said, I saw it.

Say it to me, huh?

I hope it's not all too serious, but I can't hear it.

Please.

Well, I wanted to tell you that we... That I, as a matter of fact, had suggested this...

This...

I would want to say that I suggested...

that there are such common interests and a lot of problems, and eventually, sometimes they come to your editorial meetings, and this is what you do.

You do get the same, the same sets of, uh, of, uh, direction, dissipation, as far as our dissipation, as far as what's going on.

And you do a state of forethought here.

The breathing could go on for an entire day, another day, another day, another day, another day, another day, another day, another day, another day, another day.

We're going to have Paul Cracker and Peter Peterson and Morris Stanton.

Morris Stanton.

Good.

Well, that'll be an offer.

And you'll have to do a little bit of jewelry.

You'll have to play too and all that.

It'd be a good chance to get a degree.

Good.

Or here.

Or the Kitter House.

I'll do it this year.

Okay.

I think you can.

I say that, uh, that, uh,

The most

could be the most important briefing we have had in the domestic field since I've been here.

Beyond the balance of payments and trade policies and quotas, et cetera, everything related to that, it really goes to the fundamental question of what do you want the United States to be five years from now, 10 years from now?

What can we be looking at the world in which we live?

And if I say,

the political, military, and so on.

Japan tried to get one number out of the air at that time.

As a matter of fact, even by 1950, Japan was producing.

In 1947, the Bureau of the Dead, he was starting a, he was an MSC in the shared district.

He doesn't often agree with me, but he always says here, we talk about these things,

He is a very strong supporter of the view of foreign policy, but he urged the Canada Senate to talk about why organized labor's attitude toward trade had changed.

After all, in 1947, who could compete with us?

Not the Europeans, not the Japanese.

Nobody thought of that at that time.

And today, the situation is very radically changed.

who still talks in terms of this organization's long queue of competitive policy, that there are enormous pressures from some of these memory units.

The piece of briefing, I think, is something that we in the administration need to hear.

It's also something where we would have to explore

It goes far beyond the recent dollar crisis.

It goes to the United States and the world.

Affiliate them to World War II, million dollars in aid, and so forth.

We've got a very important country trade policy.

Major shares are in the regime that's concerned.

Totally for the Japanese.

Totally for our security.

and for the Germans, as far as they had any at all, and primarily for the Europeans.

And under these circumstances, Simon, the country of Simon, that, uh, came to turn inward, to turn inward on trade, to turn inward on aid, in all of its aspects, not just military, but economic as well, to, uh, turn inward in support of these problems, these questions.

Not because I have reached such conclusions myself, because I have not.

I used to think that back in the time I was vice president, attitudes have always totally changed with regard to people in prison.

Steel people, they change.

Not only will people change, they're concerned about the fact

or that these cars will be sold to the West Coast this month.

And American cars.

Not to mention, now that doesn't mean there aren't still problems thoroughly with the business council or the IBM people, the computer people, et cetera, et cetera, who say, ah, we must do this.

The business community changing.

Now that reflected in the Congress.

So what does this mean?

But we must do, instead of becoming basically the captive of those events that have been, and I think the more we, the urgent message is building the wall around this country, turning it to, what we must do.

The problem is in those areas where the United States can compete, perhaps

one of the ones that makes it hard to look at how much the United States is, uh, uh, uh, uh, uh, uh, uh, uh, uh, uh, uh, uh, uh, uh, uh, uh, uh, uh, uh, uh, uh, uh, uh, uh, uh,

Mr. President, you mentioned the dollar crisis.

Does the administration have any new programs to deal with it, so that the flare-up that we recently had might not be repeated?

Or do you have any programs to try to get the balance of payments down to a more, say, tolerable level?

Well, you know, I think at first, when you talk about the dollar crisis, and I suggest all of you

I thought that economists and the administration, the economists of the Fed, the economists of the Treasury, the economists of the Council of Economic Advisers, all have varying views about what caused it.

It's certainly a crisis of a mark.

A mark more than it is of a dollar.

You have to understand that if the Germans do not have a highly inflationary situation, a situation in which the numbers do not reflect as much as actually is the case, the case of the Russians never reflected as completely as ours.

Nevertheless, the Germans have a highly inflationary situation.

Therefore, but...

this jerry-bill, and I would use the term visage without knowing too much about it.

Now, every time one of these occurs,

uh, there's many suggestions that have been made around here, a lot of the other international lines that are not, you know, that didn't reflect the words of the Times or none of them.

And, uh, uh, the current position, I mean, right, right, so, uh, you know, most of the papers say that, and so, uh, at the present time, to answer your question quite candidly, I do not, we, I do not believe that, uh,

that the purpose would be served by having an international conference, an attempt to establish some new method for dealing with this problem in the future.

I think, and I don't think I can apologize about this, I think that in the next few weeks, this problem, I'm speaking now, and it will only come when there is cooperation by all concerned

because all were playing their own games for their own purposes.

The Japanese were playing for their own purposes.

They don't understand about the game.

The Japanese, the Germans, et cetera, et cetera.

Then, it was saying that on an orderly basis, that the other countries involved, the possibility of some change, but until we develop, we develop within our own financial community, within our own administration,

What we want, we had better very well not go to any national conference.

That's why I completely rejected the advice that some gave around here on this crisis period and reached a state of mind.

I rushed over to Europe to have a conference.

I said, not now.

I said, what do we want to come out and nobody knew.

Well, we'll talk to them.

So are we going to have the Dutch and the Swiss and the Belgians and the Germans and so forth?

Tell us what we're going to do.

I think we have to determine why anything we think, and there must be something, is a better solution, is a better system for the president.

And once that is determined, then a conference, properly planned, well in advance, it would seem to me, would be very much in order.

I just don't think you can go on crisis after crisis.

That's my opinion.

But we are not yet clear about that.

With regard to the second part of the problem, with regard to the part that is specifically our fault, for example, the suggestion our interest rates are too low compared to European rates, and that brings, of course, the outflow of capital from the dollar from the United States.

And if you look, of course, at the war of caters, a big part of that bundle was, of course, the outflow

are attracting interest rates abroad.

But on the other hand, the idea that because this situation doesn't exist, that now what the federal, and I now get to sort of state territory, but I couldn't agree more strongly with John Thomas' emphasis that the states cannot tailor

his economic policies any more than the Germans have in its crisis to the fluctuations of the international monetary market.

We have our own domestic economy due to the incentives.

At the present time, the economy is moving, as some would hope.

But the debate, fortunately, is not about whether, but only how much.

And that's a very nice thing to be arguing about.

But I certainly do not subscribe to the idea that because there are some problems on the international trade field, that now this is the time for the United States to take a step in the problem line, raising our interest rates, frankly, for the cold water of the deep upper threshold.

uh, uh, 20, what was this month?

Maybe 900,000.

They're still up for that.

Of course, you know, Harvey Drake's his president.

I do not feel that, I do not feel that I, that this is the proper, uh, ticket.

Looking at it from a long-term standpoint, we have to recognize, in this country, this goes back to the Phoenix Supreme Court, it's fixed.

After that, we become non-competitive in a great number of fields.

We're becoming non-competitive, for example, in steel.

Two years ago, we had 50% of the world's steel market.

Now we've had 99.2%.

There's this layer of everybody concerned that there must be, if you're going to deal with a long-term standpoint, that there must be differences on productivity, on markets and products,

I'm wondering in the light of the

Well, the unhappy position of the dollar is not a critical one.

And at the anticipation given, he thought to re-appraising its foreign earnings or its foreign grant policies via the Equal Income Bank, via the Inter-American Adulting Bank, which is an appropriation of what Congress now, a very sizable amount of money for that, via the World Bank.

As you say, things have changed in 20 years.

I wonder, have you thought that perhaps our posture toward the International Lending Agency would very largely operate on American dollars?

What not to change as well?

Well, we've been expanding the process of the situation.

And I'll let George comment a little on the export.

It's worth paying for your license.

It's a huge deal.

So I think it's been a help in our exporting.

I don't think it's been a...

I'd like to take the example you mentioned and land them to our advantage to help a purchase that stimulates our exports under these circumstances.

Well, one good reason is if I were a stockholder of Trans World Airlines, or American Airlines, which had to pay 11% of the market last week, I think I might be a little upset.

And sometimes it is borrowing seven, or seven and a half, or eight, the exported book back very big.

It is certainly below market.

Well, there's always a balance in these things, but one of our problems in trade is to stimulate our exports, and this is one way of doing it, just to say.

And of course, you know, we had a rare disturbance in a very difficult situation.

But this, of course, is not a genuine export.

This is money that we take out of the treasury to buy airplanes.

Now, this may be called Boeing or Seattle.

I'm not against that necessarily.

But in terms of simulating genuine export, in terms of balance sheet, shall we say, it seems to me we wind up exactly where we were before.

A dollar goes out and a dollar comes back in.

Well, I think that the XM subsidy is small in relationship to the total deal, very small.

And it's helpful in getting people to think about exporting as much as anything else.

And Henry Carnes has done a marvelous job of getting around, particularly in this country, and stimulating that.

We have quite a little debate going on about the trade statistics.

The suggestion is made, in effect, always made this way, that all exports that have any kind of government subsidy in them ought to be excluded from our exports.

It's a very ridiculous suggestion when you think about it.

It comes about by way of trying to dramatize the fact that we send some things abroad that are practically 100% subsidized by some of our food programs.

But the deal that you mentioned of sending 707s abroad is a deal that has some government subsidy in it, but it's very, very small.

Crack is one of the ways people compete.

It's one of the ways the Japanese have it.

One of the things that's happened to me, of course, we get from R&C, there's another side of this, too.

We've got our American producers, and Ernst will give you a hearing sometimes, an enthusiastic follow.

He makes it up to four of us, as a matter of fact.

He's more dedicated than they are to me.

I know, I know.

He's a charge, really.

A charge to be very effective, because he's trying to keep everything going.

But basically, if you talk to American producers,

potential exporters.

They were telling me over and over again that they had a devil of a time competing because the Japanese particularly belonged.

They're tough, they're tough anyway.

They always nod.

Nevertheless, the Japanese and our European friends

have a number of, every kind of device that they use for the purpose of subsidizing America.

The Germans and the French.

You know what the French are doing with Latin America and Africa and so forth and so on.

They're doing a lot.

Of course, you take even, of course, this is where you get to a very, very sensitive issue.

But the French are in the arms business pretty good now for the rest of the time.

Larry was talking to me the other day.

that the French, this involves American foreign policy, this involves a situation where arms are going to be purchased, we're not talking about the Middle East or something like that, we're talking about the Latin American countries, the Latin American countries, the rest, arms are going to be purchased.

So what happens is that the French, for example, in Barcelona, go ahead and sell the arms, let go of the Russians, they go ahead and sell them.

The other point is that they go ahead and sell them on a,

on a subsidized basis, and this gives them an enormous foreign policy cloud, as far as the American foreign policy is concerned, that we should look to whether or not it is in our interest to allow countries, particularly in this hemisphere, to come to that, if it's going to be done anyway.

So that brings me to another question.

Mr. President, the kind of solutions that you're talking about, better productivity, more competitiveness, are really long-term and are dealing with some very different .

Do you have any plans for taking short-term action against inflation and the dollar problem, which of course is .

Let's talk about the inflation problem first.

We mentioned the economy a moment ago.

I, uh, pointed out that, uh, it's still a major problem.

On the other side of the coin, we have a major problem with climate change.

As you expand your economy through an expansionary budget, through a lighter, through a more liberal monetary policy, what's your problem?

There's several things.

One,

we are going to hold just as firmly as we can, despite the congressional attempts to hold the right to send people on our budget.

Now, I know many, many do not support it, or do not agree with the concept of any of it.

I would prefer to call it the full-capacity budget.

Now, yeah, look, what is full-capacity?

So people say, well, let's just say full-capacity.

Yeah, for me,

If I could spend a moment on that.

I basically come from a school that has traditionally believed that a balanced budget is generally beneficial and is generally desirable.

However, I remember well during the Eisenhower administration that we ran a very significant deficit in 1958.

And we did it quite deliberately because 1958 was a year of recession.

And so I've always felt

and if so, read the medications long before I came to this office.

That when the economy is not in full capacity, government then has an obligation to exceed the budget.

But when it does reach full capacity, that government has a common obligation to, at that time, run surplus.

In other words, it balances something.

We use it a lot in terms of cyclical balance, for example.

I think the concept of the full capacity budget, the full employment budget, is something that my son, because it is so, this is just a blank

It is not at all.

If we were to write a check for deficit spending, we wouldn't save both of us, but we would spend.

We would take the health program at some center and put up an $8-6 billion and say, well, we're not going to make $8-6 billion.

We put the limitation, of course, on full capacity, but the taxes were reduced to full capacity.

Because unless some limitations put on government, you are going to have a highly inflationary budget policy.

So in terms of inflation, we will continue to resist those types of programs that will be on that budget.

It will be hard.

It will require details.

They will come.

That's the question I was asking.

Your question?

In terms of the...

often raises the wage price higher than the present time wage price.

And we have an answer for that with the front-handed orders.

We're going to merge labor and the first half.

We do have some thought to those of ours.

We believe that we can temper those increases.

probably get them down to five or six percent.

It's going to happen, but at least they can be tender than that, maybe a fifty to a hundred percent.

And that will be a help.

But insofar as an entry in the waging price barrel in terms of going all the way in terms of waging price controls is my view that there is really no middle ground.

I would like to believe that there was.

I would like to think we could do it the hard way.

And I just, I, I'm not however pessimistic about it.

While I think the banking problem is serious, I am not as pessimistic about it as some are because I know our budget policies are going to be responsible.

I know that our monetary policies and our firms will be responsible.

And we're not going to have them.

And why have this worry that we have?

in 1968, where at full capacity, when the economy was at its operating full capacity, we ran a $28 billion deficit.

And the Fed had a monetary policy that was totally irresponsible.

So I...

But you do rule out...

Wage and price control.

Totally.

Do you actually do anything with the steel negotiations which make people very concerned about them?

Well, I am certainly concerned about them.

In a sense, you know, you try to save people.

I must say that I don't have a great confidence to say that you have to be effective.

Unless you can bang it up or something.

But I...

I would not like to express any, uh, any, uh, thoughts on that score this time.

I'd actually like to reflect on, uh, the, uh, situation.

I don't know what else to say about it.

I think, uh, the real problem, as, uh, you've said and others in the administration have, is that it's a very tough, uh, situation.

The parties are in, the industry is suffering.

It's, uh, profitable.

compared with others, they only have 2.5%, as both of you told them over this, 2.5% profit, the lowest of any major industry last year.

And here they are, you know, with this huge wage increase and this cost to figure it out.

So why do you even see the industry struggle?

Why do they raise prices?

Of course, you know, we tried it once.

We rolled it back some.

But there are reasons, you're right, really.

The Secretary is not in a position to be

At the same time, the Indian is coming into it with a big head of steam, comparative increases, and also the catch-up notion which has merit to it.

And I think we can look forward to a conspiring situation.

Somehow or other, I would hope that the parties could find something constructive to lead them toward

for controlling their costs and at the same time dealing with the wage problems they have.

I think it comes right back to what the president was talking about earlier, the productivity of the industry and what can be done about it.

And one of the things was,

The most puzzling about the steel industry, I think, is the fact that they've had some big increases in investment over the years.

Excuse me.

Big increases in investment.

And, of course, a lot of the equipment recently in the steel industry.

And yet, when you look at their productivity figures, it doesn't seem to show up in the way you would expect it would.

And there's something there that

needs to be gotten at, and I wouldn't be at all surprised by where it lies.

You have rules in the labor relationships, and we all know how difficult it is to dig into that area.

But somehow or other, it seems to me, the answer to their problem lies in that field, and I would hope they could talk about it, although I don't know.

Well, I think we all, in May 1959, most of you were around that year.

Remember, I was involved with the election of the Senate after the steel strike.

That's the last time.

That's part of their problem.

It's able, you know, he's a little boy in downtown, succeeded with Dolly.

They didn't want to be the company man.

They wanted a little strike.

So they're going to have one.

At least they're talking about it.

But I remember in 59,

I didn't understand it as well then as I did now.

But I thought the PR game was all about the numbers.

You know, you've got those numbers, you know, you've got to know these fractions about this and that.

And I said, well, what does that amount to?

But Roger Bob said, there's a person from Alabama, $30, $40 million, you know, one half of the real problem that he had.

But Bob, a contract clipper, was there to go share.

And that would have settled for it.

The whole industry would settle for it one way or another.

workers.

And they didn't do a damn thing.

Just promised to talk about it.

The thing that's true is that I mean, the railroad negotiations, the railroad, there are plenty of issues with workers.

In fact, I think, I think throughout American labor today, and I would say this to me, you were sitting here earlier, the major problem is they're on one is to grab the boot with the problem of workers.

They feel that they're losing control of, uh,

I love the, uh, the, uh, you see, you look at that, you look at the, uh, you look at the number you've had now, you know, 50, 50, 50 percent, 50.

But I didn't talk to major contractors like .

He said, we can get into the work rule problem.

We can solve this.

But it's the work rule problem that I think, and George, one of the reasons we set up the Productivity Council is taking time to the very fact that the labor union leaders are still in it.

It's almost a miracle that there's some law and so forth.

the American labor unions have got to frankly face up to the workgroup problem.

And of course, once they do, I think it's a competitive decision to change.

It's part of the reason, it's part of the reason, one of the reasons why I am so excited about the Peterson Report, which will be followed up for your information.

My major speech on the series on attachment to speech is really to educate the American people, the American people in all sectors, including the Congress, labor, and management, to face up to the problem of where we are.

We may be at the end of the era.

I mean, that's what I'm concerned about.

I'm really worried.

We talk about, I mean, we can all argue about the SST, which we'll go down to tomorrow, because we've slowly decided we prefer to have the termination process take the risk, blah, blah.

So they'll take the next 747s until the SST will do not everything else.

So as the SST goes, and we recoil moving into other fields, there's an addition of development over your power.

to share what it might do for the environment, the United States going to be making.

This question, the question came to us, who's going to be first?

I think that, many think that, too.

But agree with this, this country, this country has had a long tradition, particularly the business community, and whatever shared a lot of feeling about, we can do anything better and

We have made it better and made it cheaper in other great places.

That tireless is now running out because there are others all the same.

Others all the same.

Joyful people with spirit truths.

They want a subsidy of all because the Japanese do in that way.

It's the two nations, the two nations, the Germans and the Japanese, both without nuclear defenses.

And they can never, if we repeat those, never have because they were banished from World War II.

The Japanese, the English people, the Haitians, I told them 25 years ago that the Chinese will replace them, not simply because of their numbers, but because in Europe, whatever we think, our people, the perfection that they have, the British, the French, the Italian, the Spanish, the Reds, who are the people in Europe?

The Germans.

They have been, and they will continue to be, a most dynamic group of people in our country.

Here they are, two lost, two defeated nations, now, from an economic standpoint.

really first-class competitors in the United States, and they're just going to, they're going to beat us unless we get hungry in some areas.

They're going to say, all right, we don't do that as well as the Japanese, so we're going to let them do that.

SSP, well, we don't want to get the skin cancer, we've got the environmental problem, so who wants to go, what business, why do the businessmen want to go to Paris?

three hours faster to get there and make it take half his time.

Of course, what they fail to realize about our SSC, the SSC becomes important work.

Ten years from now, we'll look back and wonder why we needed to do it.

It's because, even in the period of the last 30 years of this century, we're just going to need to get rid of a specific single difference, apply the total, and if you've taken that,

It also makes a great deal of difference in flying down to VA.

But it hasn't changed.

So that goes on.

And then we move into other areas.

Automobiles.

Well, the Japanese, they can make them cheaper.

Natural cars.

For example, I recently had a GM and Ford at Chrysler.

And they don't know the airbag that somebody wants to hang on the car.

Seatbelts, you put on the seatbelts, they hang around, the buttons go off, you know, and you have a whole lot of fun.

Anyway, these pulses, do you realize that every time we put one of those new devices on one of our cars, we become less competitive.

It's required for foreign cars, too.

And, of course, it all comes home.

When they put them on, it costs them much less.

in terms of because of labor costs.

When we look at the problems of environment, the problems of safety and the rest of it, while we all are worried about wanting progress in these areas, we have to weigh those decisions in the light of the competitive position that we have over the last year.

I do not know.

If I were a SEAL, let me put it this way, if I were a SEAL worker, I'm still here.

I'll be here for you.

given they are often compelling arguments.

You know, there are less people working in the field today than there were 20 years ago.

Less people.

Now, the union has a few more members, because it's far beyond being natural.

But what does that prove?

And here you are, in this industry, this is because of automation.

It's just the very fact that

We are both.

Now, what's the future of that industry?

What's the future?

George talked about the steel industry.

They've done a lot of modernization, right?

But they tell me that the best plant still is in Germany or Japan.

Certainly, they're fully comparable, but they

And that would lower labor costs.

So we're out of the game.

Mr. President, what's the answer to the problem you posed as to how we're to regain or reset our traditional economic superiority as a nation?

Well, first of all, this is where I think we all come in.

It's an enormous problem of educating the American people

They got to, what I fear is, I don't mean to do, I'm quite confident about the future.

I just think, I don't think, I just can't believe that this country is near the end of a great period.

And of course we've got, as we all know, I mentioned a few problems.

We've got some areas where, well, computers or that, the rest.

You can see what the Russians really want from us.

They want to sell us.

They're loyal to us.

We frankly didn't.

And we just assumed it was going to go on and continue to go on.

And we now are error of the trade.

And we may not find that they can go on.

And the United States may forget military security.

Maybe people ought to get out of that business.

So that's something that people will debate and say.

Here, everybody says, well, the United States will be first, even I.

And of course, we're still on our way.

We're still bigger than the other people together.

But when you come down to it, that position can change unless the American people look at the situation, face the facts, and then decide we want to do some things.

And that will be reflected in the decisions that are made, the decisions that are made at the bargaining table, the decisions that are made at the Congress.

Take, for example, total

The total, I mean, without being critical of the Congress in any partisan sense, because Republicans, many kids are as bad as my Democratic friends and some of our best supporters in this state who happen to be some of our best Democrats, plan against the legislature to put more balance in the labor-management relationship.

It doesn't have a chance of a snowball.

Well, there you have it later today.

And if it did, it would be worse.

And we have to go back to the land grant.

I think the people down in Hartman, the labor committee, both the House and the Senate, is that irresponsible.

So no way.

I have to get it.

Take, for example, the desperate need for the passage of just that little simple piece of legislation in the transportation field.

Most of you have forgotten that we introduced it.

It provided for, basically, so-called compulsory arbitration.

Not really, but in that field, it came as close to that as you can come.

And we may have to go that close in order to have some kind of possible solution to avoid this.

It's not the railroads, it's the docks, the trucking, it's the whole business, you see.

For a year and a half, that legislation did not even pass a hearing on it.

Why?

It's because the Congress reflects the country, not the people.

At the present time, they just don't feel it's politically popular to take this issue on.

Political antennae tell me that that can change if the American people become aware of the fact that we are becoming non-competitive in the world, and particularly if it begins to affect jobs, as it will.

Now, you're going to begin to talk about this public disservice, actually, but I want to do it, I want to do it, and we can't get it too late.

Uh, the reasons I want Pete tonight to, uh, some of you who've heard, who've heard part of the reason, I hope you won't mind hearing it again.

I want to hear it again to, to comprehend it.

But, uh, it is necessary to lay the foundation.

Let me, let me tell you what I think would be a mistake.

My business friends come in and ask me, I don't know what's wrong with me.

They just want to raise hell with you.

It doesn't work.

because many of them have problems too.

The American business community needs to get a job.

A lot of this management is lousy.

And it's exciting that the schools they've gone to, they've turned out to be very sorry operators.

And when you look at the labor community generally, there's a bunch of thugs and rugs and so forth running there.

That's just not true.

I mean, there's

I've asked the decent people on both sides, plenty to fall on both.

Perhaps because labor is oriented to getting more, and the great tradition of Samuel Connors, it appears to be more of the culprit here.

But what needs to be done here?

is to present this not even as a background.

American labor, and only 25% of all workers in the United States belong to labor unions.

You know, it's true that that 25% affects the balance of settlements.

I do not agree with this.

Compared with Britain, our problem is infinitely less difficult.

We at least have some countries.

But nevertheless, we live in a low labor-management relationship.

I think you're going to get a change there, a change in the Congress, and a change in attitude, only as the American people become more concerned with where we're going.

Let's go back to the time.

Remember when we passed that party in 1947?

It was passed.

I was in the Congress.

I was on the leader.

It was passed.

It was passed over to children's people.

It would never have passed unless the country at that time was ready for a labor management bill.

It was necessary.

Now, at this point, what is needed in the labor management field, I'm not prepared to say, but what I am prepared to say is that I know that not only the labor management people,

But in business in general, in terms of our competitive position in the world, productivity, et cetera, all of these areas, there needs to be a lot of soul searching as to where we go from here.

For example, John Connolly mentioned something in the data that we've been discussing here.

Did I trust?

No.

Yeah, we took care of a few.

But what I was going to say, Senator, we have got, in terms of the antitrust laws,

that because the business is big, it's bad.

The idea that the rules and regulations of the Sherman Act, which we're going to go back about 80 years to the police, the philosophy of that applies to the world in which we live today.

And it does mean that in some instances, we're certainly in an ancient competition.

We're out of our minds unless we have one or two strong competitions.

rather than since it can't compete in how we're going to keep which areas, both at home, in terms of our national position, and also some at home, we've got to examine the antitrust laws.

And we are in the early research to examine the antitrust laws to see what really will make us more attentive, and not just have a bunch of the trust busters

go out because the letter of law said this, bust somebody else.

We're not allowing this merger or that one or the others.

And that doesn't mean all mergers are good.

The experience of some of the inquirers would indicate that they aren't.

But it certainly means that today some mergers are absolutely necessary and even ones that

that we have previously thought, technically, of our island in law.

At least that's my opinion.

You will.

I'll put it this way.

George, before you go on, George, tell me just also, you, in our last quadrant, I mean, because we're all very superstitious, you know, what was it that you said about antitrust in this?

You see, George, as you know from the University of Chicago, there are all three traders out there, and I thought they were all even trustworthy.

But you took a good kind of lock on those.

It's kind of weird for a competition.

So I thought, how do you find out that a merger can be helpful in a competition?

Is there something nice in places where that acquisition promotes competition by making a smaller company a little bit more powerful in the marketplace, so that I think

The assumption that all acquisitions or all purchases or what-not are anti-competitive is just not in accord with the facts.

Not that there aren't some that can be anti-competitive.

But if you look at our history and try to trace out what's happened to the vertical integration or horizontal integration, we have a very dark conflict of account.

The case that either has grown in any particular way

over the last 30 or 40 years or over the last 10.

But I think the main point that the sort of planned assumption that acquisitions are always anti-competitive is just not incurred in the facts at all.

Let me say this.

What I would hope that, and I don't want to put too much of a burden on Peterson's report, but what I would hope that he would do and what he was doing already in his department is this.

It would force us at this critical time in our economic history to re-evaluate our trade policy.

That's obvious.

To re-evaluate our...

labor management policy, to re-evaluate antitrust policy, to add, looking at another area, and I hope you will ask me about this tonight, to take a hard look as to whether or not there should not be heavy work subsidies.

It's a bad news to me, too.

I don't choose to be a pastor, except for farmers.

But anyway, that's different, of course.

There is a difference.

But whether in the field of R&D, where Dean says that he would guess at the present time the total R&D of American history, I can't believe this number can be so small.

It's between 10 to 12 billion.

Here's NASA's review.

Suppose you were to bump R&D, I mean, I understand, government and private, or a case might be, let me use one example.

You all heard about desalination, and everybody, and all of you know, of course, that no breakthrough has been done, none probable, but we'll be sure none will ever come.

But one thing that everybody is certain of is that

as we develop a greater reactor, and at least not only a clean source of power, but a cheaper source of power to create a nuclear reactor.

Which at the cost of the energy now, that then we are going to have to site new water, we'll call it, not clean water, but new water, which would be

Now, that's probably 10 years away, maybe 15 years away.

At the present time, we've got a desubstantialization program.

We have an office of what they call saline waters.

And I said, where is that program?

It was set up in 1952.

You know where they got it?

Over at the Department of the Interior.

They certainly aren't going to nurture much because the Department of Interior is dead, you know, and all that sort of thing.

Here's what we've got.

Well, they've got a lot of nice value we're working on.

I know some of them.

So I asked this question.

I said, how much are we spending?

I mean, no.

I said, where are we in the office?

And the fellow in the head of the office was very good.

We're probably the first in the world here.

I said, well, where are we in terms of application?

He said, we're waiting on it.

He said, the reason is that the Japanese, of course, the British, I think you're the Germans, yeah.

But anyway, the name, the country you're in, you're over here with the Russians, it's not.

All of them have moved to apply, in the basis of their research, to the big plants.

You see, it's the size of the plants.

They've gone, as a result, in various parts of the world, where plants are built, where there's some deserteries.

Now, rather than being hermitized, there are other plants.

Why not all of us?

Well, because under our policy, at the present time, we have a

that the government will contribute 50%, will take 50% of the risk.

But a private company, if it wants to get this, it's going to take 50%.

Now, any of you who have stock in a private company that's going to go in the business of making, you know, converting salt water to mines, what are you going to do with this?

Can you be sure it's going to make it to the grid?

Now, let's look at the highway program.

The highway, the federal government is 9 to 10.

And what is more important, more highways or more water?

But you live in Texas, Oklahoma, or Washington, they use more water.

Southern California as well.

What am I suggesting here?

What I am suggesting is, and can I raise this not as an opinion, policy is not the right thing to do.

We have got to take a hard vote to see whether or not we want to be in the law business.

And if we do, we've got to take the research that we have, and we're going to, and government is going to have to put a lot more in on the subsidy side for the application for this science.

Working, instead of always through a private, I promise you, we can, because they can run a hell of a lot better than it.

I think they've done their part.

The last one, TVA.

You didn't hear that, did you?

The highway trust fund for most of it.

The highway trust fund for a part of it or a second or something.

That's what they'd like to actually say, Mr. President.

Yes, yes, yes.

There are a variety of ways.

Now, let's come to one of them.

We have nothing to suggest at the present time, because this year it will be to begin with the way that it is in the House, not because it's intended to be, but because most of the legislation is there.

It will have welfare, it has welfare reform, it will pass.

Replicated in some form past this Congress.

Then comes the help bill.

There will be some help bill passed in the next Congress.

And I'm alive.

And he said, well, what about tax?

Well, we got so much.

This is no year to have any more tax on this thing.

So many people are suggesting, people who come in, even the most afro under our name, that's where tax is going to be reformed.

I'm not saying another.

But I personally am not satisfied with the last tax reform bill.

I don't say that in derogation of the Congress.

I simply say that in terms of the future of this country and all these things we've been talking about, we've got to take a very hard look at the tax system at this time.

And the harder that tax system,

I indicated that rather than hatching and adding and subtracting here, taking the poor off, for example, or the alamas and so forth, and there were some good proposals in the last tax bill, and many others that I know were bad.

But nevertheless, it's still the same system.

Now, where do we go from here?

There's a lot of ideas that are growing.

But it seems to me that we must take a look at our tax system insofar as it affects, again, the competitive position of the United States of the world.

And maybe we'll have to use the tax system much more imaginatively and boldly than we have previously.

Now, you get the hell out of it.

You know, there are purists.

And the purists, I remember my professor of taxation at the University of Los Angeles, Charles Adams, wrote a book on it.

He said, how scary is the tax system for social purposes?

Well, of course, the tax system is pretty good for that, too.

And you make a suggestion, for example, why have the tax credit to parents and others who

for the tuitions to send their kids to school.

It's a very good idea.

I've always been for it.

Apart from the cost, they're guessing because they say that you're really doing something there, and all you've got to do is direct something to demonstrate my concern, my point.

I think the government needs to have the tax system.

I'm not prepared to say on which end I can better suggest, but I think the tax system

It's a integral part of this whole pattern that must be removed, that as we see, as we look at antitrust, as we look from the killing to the normal rest, and has that responsibility.

Question.

Considering the pressures upon you and this government now in the field of trade, and considering what you see for our necessity to be very pleased on what our trade policy should be in these years immediately ahead, and more than that, perhaps you'd like to comment more on the role of the U.S. economy in the world in the decade ahead.

Well, in the field of trade, I've encountered all problems.

I can get an

or as a Republican, you should pattern.

I hate to believe, well, I have a very good pattern.

I lean to free trade rather than protecting school.

I'm always supportive of several trades, et cetera, et cetera.

I still do.

I lean to it for the reasons that

are not really based on the extent as they are on the fact that I am concerned about two things.

I think that the United States of America, the American people, if we do journey, if we do build up these walls around us, then we are not going

I can't compete.

I just want to go out in this country that is very, very important to America.

People have to compete.

And I think that that is important to the standpoint of the peace movement.

I'm prepared to do it now, but this is the right time.

At the time, particularly, I had a pretty thorough story on the East-West trade recently.

I subscribed to most of the ideas.

In my view,

Well, of trade between East and West, due to the fact that they do not have any, any, any, any trade devices for national monitor.

You know, so everything is in terms of transactions.

If you look at the national monitor situation, I think the Russians have addressed some things that will have to do.

But I believe that in the long haul, in the long haul, the world is going to be held up safer

all of us, if we have a world in which we have a great agreement and a great amount of trade and combinations for it by the end of that proposition.

Then you come to this immediate proposition.

You're all aware of my position on textiles.

That is a temporary and, I believe, necessary position for us to take.

and uh it's temporary it is necessary for the reason that the japanese very frankly have some of the sun here in three different occasions are adopting a policy that is two for them one for us hell go to japan try to get in uh uh

talking to Jim Roach.

They're trying to buy a sticky little plant over there that makes lousy trucks that are competitive, I don't know, something else.

And so the Japanese said, maybe we'll let you own 20%.

Maybe 30%.

Maybe 30% or something in between.

The Japanese block us out as far as investment is concerned.

They have various ways to keep us out in terms of our own exports to Japan.

And yet, here we are.

All of them, and they sent it in here.

Now, observe.

A Japan which is oriented toward the west, toward the United States, is absolutely essential to peace in the Pacific.

A Japan that became disenchanted with us and moved either independently or in the other direction.

opposed to an armistice for a piece of much greater Chinese for the next 10 to 15 years, due to the fact that they're a hell of a lot further ahead.

And anyone knows this.

So therefore, we've got to handle the situation in a way that does not alienate them.

That's why we talk to them.

We try to be reasonable and all the rest.

But there are hardly any partners in the world

I knew this as a lawyer when I used to have to deal with them from the yard.

I know it now.

And, being the hard partners that they are, uh, dealing with tax deals, this is one area where we've been a partner hard with them.

And the quid pro quo, they're, they're, um, they're an open-up sum to us.

I'll be used to continue with a little chapter versus because I'm putting, basically, in charge of the tax deal.

And, uh, we're going to start.

So,

I can say that my view of the future as far as trade is concerned, as long as I am here, I will opt against the police.

I will opt for a liberal trade policy.

The Japanese and Texaco problem is a special one.

I have to deal with that for the U.S. commitment.

U.S. officials say looking down 10 years would be a concern.

I don't know where I can see that far.

I would not want, by erasing these problems, to indicate a varied attitude with regard to that position.

Because having talked about how strong all these other countries have been, I've had most of them.

And we can have things some comfort in this.

We have our educational system.

Again, I can't explain it.

Our science is this essential.

Our school, educating people, we've got all the experience we have.

The States at this time fails to maintain a panicked position.

It would be

certain, most inexcusable failure that has happened in recent world history.

We just have all the luck going for us.

And as much as these other places have going for them, they've got a number of very, very serious problems.

They have very great liabilities.

And so, uh, I, uh, and I would start to oppose this by saying, this question answered by saying,

The reason I deal so strongly on a liberal trade policy and a liberal investment policy is because they're, of course, two of a kind.

Long term, once we get rid of the war and get some sort of settlement on arms and other things, all these things are going to come very soon.

They will have to look into China, as you know, and work on that.

In a political field, it will be so long term.

Long term, this constant...

I think it would be very helpful in terms of peace in the world.

Even though we must remember that those nations in Western Europe that twice in this century have caused 10 million deaths in their wars were all trading with each other before the damn wars came.

So that's all right.

I still believe in trade for that.

Modern trade.

Modern.

The second thing, the second reason is

But I feel that this country, this country, the American people, will actually cease to be a great people if we do not face up to the responsibility to compete with the rest of the world.

President, you've got an engagement that you have to... Oh, I think you also have to get to that break.

Where is the Decatur House?

It's across Lafayette Park in the new... On the end of the...

Yes, sir.

I don't know about it.

I'm lying.

I think you do the fact that we've done it since you've been so candid.

We really had to make this all completely off the record because it... President's looked a long way at the end of these things.

That's really...

Well, what I'd like to suggest is that if you, uh, you know, I apparently would agree with some things that would be coming to your question earlier.

But, uh, the main thing I believe that all of you is this.

There's one thing I, I heard in a foreign policy area.

He took a lot of his, you know, perspectives along, and I'll get around to this and that, but he doesn't say, we're in the West, or not the West, we're in America.

are terribly efficient people.

That's one of our great strengths.

That's where we get things.

And we are people that seldom, we seldom can keep vision very long.

I mean, they say, well, it's quick.

What we need here in this area is to do something that is really rather, runs contrary to the American character.

in our whole background, very practical, pragmatic people reacting to the situation around us in our great free enterprise system, you know, that's brought us along.

And really, you never come to a point in our history when it was necessary in times past, and I believe it is, for us to take a longer view.

But it is necessary, and World War II did not occur, probably.

But World War II hasn't occurred.

It didn't look necessary earlier.

It hasn't occurred.

And all of our majors and masters have been left prostitutes.

Now, 25 years later, here we all are.

And the question is, where are we going to be?

We have to have a look at it and start thinking about it.

And that's where I get back to the immediate problem is what's going to happen to development.

And so we can take a few cheap shots at it.

Well, it's having their National Monetary Conference, or let's raise the price of gold, or let's raise interest rates.

Have the Fed tighten up and raise interest rates.

And the main thing is to save the dollar.

The hell with unemployment in the United States.

Well, to me, those are the wrong approaches.

I can understand.

I know that those who deal with the international military can say, well, the administration doesn't understand.

I don't care about this.

We understand it very much.

We care very much.

But to me, what is most important is a strong, healthy, inherent economy.

We're going to see that that's not the best of our ability.

And I think the better is dealing with a new international monetary setup, which, as I said, should be, under no circumstances, should be entertaining any kind of a conference until we get our own Dutch girl, and then we find out what we want to have come out, because we will determine.

And unless we do have our own Dutch girl, it is difficult.

And second, to the broader question, I think it is so important, right,

For us, instead of thinking in terms of, well, if we're going to have a quote on contextual finance, see if we'll find that.

I've got a lot of moments.

Look at our trade policy.

Look at our labor relations policy.

Look at our tax policy.

Look at our antitrust policy.

They're all in a bag.

One great big problem.

Rather than committee by committee, crisis by crisis.

Is that the kind of thinking that we're trying to do in the administration?

I don't want to give you the impression that I thought it all through myself, but as somebody said, I know all the questions, and I don't have any answers.

Thank you.

Thank you very much.

Well, I think most of you who were here before me, I always had a little present here.

golfers and your wives are, so I'd like to join the golf party.

That's the presidential golf ball.

I don't think there's

It's got a seal on it.

There you are.

Now let's see.

We've got one of them.

Let's see.

Both of you.

These are, uh, these are, these are red box, actually.

We're going to pick them up here.

We're going to spend some consumption on them for the court.

But anyway, I'm going to hand them over to you.

They're the presidential companies.

This is a seal that you see here on the map.

It doesn't have my name on it, so I'll leave it right there.

All right.

Go up here.

Hey, uh, I had a very good story that I told when I, when I, when I met you, sir.

I met you, sir.

who came in and talked to me about the, they were concerned about our policy toward Israel.

And I would say, look, I was hanging with Mrs. Meyer, and I said, the main thing is trust.

And I said, she trusts me, she knows that our religious people are going to maintain the balance in that part of the world.

And when they left, they were actually retreating in representation of the people of the world's greatest peace.

All right.

You get one, too?

All right.

There you are.

That's where the ladies are going to be out there.

I don't know whether she's a snag or not.

Whether I'm a snag or she's a snag.

What they're going to do is they're going to plant white flowers in the garden.

People would sit here and the ceremony would take place and they'd walk down the aisle side.

Oh, I mean, the kids these days always figure out something new here.

The other White House weddings always took place in the East Room.

So Trisha's at the aisle.

She's very quiet, very composed child.

She's a child.

She says, look at that.

She looks very much like her.

But she's like, well, I've got to do something different.

So she hasn't done it.

Rose hasn't done it.

This should be beautiful.

You better issue me a thank you for what I've seen this morning.

Scott, you're going to give those Democrats the blitz, I'm afraid.

Well, thank you.

Thank you.

Well, it's a pleasure to see you.

And you'll enjoy the kitchener house, I hope.

Incidentally, call us when it's over.

I don't know if we should have bought the dam, but...

Thank you.

All these gliders are the same.

They don't know what they own.

That's right.