Conversation 531-016

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Hello, how are you?

How are you, how are you?

Sit over here.

But I was, uh, suddenly, I was talking about that, uh, team meeting for policy.

I was, uh, I was, uh, talking to John about your letter.

Did you see the copy of it?

I sent it to John.

Yeah.

And, uh, it, uh,

Because of which, as I understand, you're set for it, of course, I'm sure.

I think we should talk about, as I understand, the first phase situation, beginning withdrawal, and then going from there to a wage price order, and going from there to a wage price freeze next year, each decision being made in line.

The other question, of course, is the question on the tax front.

What are you expressing on that at this point?

Your primary concern is on the inflation front, in other words, rather than the other.

No.

All right.

I believe, Mr. President, rightly or wrongly, but I believe it firmly and I've looked at it up and down, that you've got to get at the inflation problem to get this economy going.

That's what I meant, but I was looking at the...

In other words, I am uncertain whether any fiscal simulation can do any good at this thing.

Well, that's the reason I asked, is that you did not address yourself through the taxing in here.

In one phrase.

In my old primary phrase.

Yeah, only in one phrase.

But the tour of the... And of course, as you know, the life of one of our council members is that we should... Well, what about this?

Let me ask you this.

To what extent did you...

Yeah, that's one phrase.

That's off of page nine.

Yeah, I saw that, yeah.

Perhaps leave elbow room.

And I put in perhaps, then, deliberately.

Well, let me get out of this thing.

First of all, in terms of spending, you don't believe there should be any margin to increase.

to accelerate the personal exemption thing?

Two or three months ago, I would have said yes.

Because one of your memoranda had indicated that.

Two or three months ago, I thought that.

How about the corporate tax?

What is your position on that at this point?

As far as I'm concerned, I don't see how you can do it.

But what about...

I was.

What about what we're doing on the...

Decrease the increase.

Has that been announced, Jim?

You announced it.

The hearings have been held.

We have finally completed all of the hearings, the analysis of the hearings.

Very minor changes have been made, Mr. President, that changed no substance at all.

We heard everybody.

We have notified them.

In effect, it's in focus.

We've notified the Congress.

I talked to Sam earlier.

There's been a question of constitutionality of it, and I don't believe he now will.

I think it's, we may have had to face a lawsuit from Common Call, from later people, but they're, after reading it, they say that the Treasury lawyers, and in turn, a lot of the Treasury lawyers did the outstanding job.

I think I should have been the questioner before.

either the constitutionality of it or other things.

What is that amount?

And so it's done.

What is the amount?

It's about three billion dollars a year.

Starting with 19.

Well, starting now.

Starting this year.

And they estimate over a decade in this decade, which I don't particularly like.

There are figures that use papers to try to embarrass you and try to show how much we're giving away.

They put a price tag of $39 billion in my ballpark during this decade.

I think any time we can get taxes out better, it'll...

But I mean, if anything, we can put anything into what I would call the job producing society rather than...

The advantage they get is in terms of the equipment that they buy.

And the equipment and the machinery that they buy.

And this in turn creates jobs.

That's the whole question.

That's right.

I don't know if you can see it.

It's like this.

And this field, we've crossed that bridge.

That's done.

And you're done.

You're done.

Oh, no, as a matter of fact, if there weren't a way of doing it, I'd reestablish the investment tax.

But I don't see how you can do that, but also doing something up in the way of the personal income tax, and then... You can't, but we have to face the reality.

No, no tax legislation is taking action.

Well, he told me that he would get going immediately on the investment tax credit of the administration, put it up to the Congress.

Now, this was about, oh, two, three months ago.

And I haven't seen him since.

He may say that now, but now he's got everything, Shaq.

And now he's got presidential ambition.

And he's got all the help he needs.

Well, I think that basically his plate is full.

He could no longer pass a little bit of Congress.

He has a chance of getting through without a terrible Christmas.

He can fly.

And I don't know, too.

We know.

Next year, it might be in Missouri.

You and I in particular.

You and I and John should have the understanding.

I told the cabinet of the economic policy this morning that what I expect in the future with regard to the administration's statements on economic policy, et cetera,

You told them that here at the Quadriad meeting.

In the morning, in the morning, we meet the full cabinet, which there are other people who are obviously going to register to do the same thing.

In the meantime, the thing that we have to get, we have to understand, is that we have the recurring call, which runs through the administration,

and that we have a special problem, which comes from your relationship.

In other words, if we speak with many voices, that creates uncertainty.

In other words, every time anybody goes out and says, well, we are reexamining our policies, and we may do this, and I advise them this, and I think this, or I do that, whatever the case might be, that itself creates uncertainty.

It also gives you how you decided to do something,

destroys it, but it doesn't cause any impact.

So we have laid out a very hard line.

The problem we have in your case is a different one, actually, which we all recognize.

Your position is independent, and you do express independent views, which, of course, you have in your position and your right to do.

The problem we have, as I see it, is that because you are a close friend

and counselor and the rest, and no one would be able to do that.

Basically, you're in a very different relationship with me.

And Judge DeMarkin was an angry vice president.

I mean, what the hell is that?

I mean, Judge DeMarkin was a nice stockbroker.

I mean, he ran the stock exchange and then came down and did a very honest job as head of the Fed.

But he didn't advise Eisenhower or Johnson or Kennedy or so forth on other policies.

I mean, nobody ever thought that he was, that he was, you know, had that kind of position.

In your case, certainly not.

The real problem we've got with the RCNR through this is I didn't see how we could have had John be a non-exposure.

He did get a key license.

I'm sure he did get another key.

Everybody has a key license.

So he's going to give me advice.

He can write me all the time.

I'm going to write him a record that had his place in the history of security, and I'll take it.

I mean, I'll take the advice that you're accepting now.

And members of the cabinet can do that, and I urge them to.

I mean, there's a lot of issues there.

or Romney or Spence, et cetera, et cetera, and the old Senator Miranda and the like.

But if John sends in and finally my person can make the decision, right now we're making decisions, preliminary decisions on the budget.

But the difficulty is that if once that I do decide that if John steps up and gets something, then if a story comes out,

from you that indicates a different view, or that you're advocating a different position, then no matter, there's no way we can really cut it, no way we can really explain it, that will satisfy the sophisticates of this point.

They'll say, well, the administration is really uncertain because

full-spread economic advice and so forth.

It agrees with the decisions that he's made.

Now, in this view, let me say this first, that I, as I've said before, I then, this time again, this is very important, and it's right and straight with you about it.

Now, of course, on the other hand, I am the only one, and this is what we have, I am the only one that has to do that.

It's not me I'm responsible.

The rest of you can all be responsible in the history books, but if this policy succeeds, it can be credited not for everybody.

If it fails, those who gave bad advice, those who gave good advice are going to look like heroes, but I wouldn't have.

And so it really, the advisor, the advisor is in a perfect position.

The advisor can give his advice.

If the policy succeeds, fine.

Because if the advisor does not follow, the policy succeeds, everybody forgets.

It's like we used to say in Congress, Joe Hart used to say, don't ever worry about voting against the bill of chances.

So in this case, you could be against it.

But if the policy succeeds, and the advice is given, it's different.

Nobody worries about giving them better.

If the policy fails, and the advice is given, it's different.

Then the advisor is able to actually in the future displace the story from the card.

Well, if you only follow that advice, you're not going to get off.

So what I really have to do, as I'm sure you understand, I have to take the responsibility.

I've got to make the decision.

I've got to listen to all the advisors, and I do listen to them.

I read everything that comes in here, absolutely everything, probably more than anybody I ever sat in here, because I read fast, and I similarly did fast.

And I have to decide.

I have decided that we should not change our policy at this time.

Now, by that, let me put it one way.

one exception.

As far as drawbacks, I've been asked to be on the 6th and it's going to be a good session.

I've got all set.

I've got the labor people, I've got the management people, I've got the charts up there about imports and so forth and so on.

We're going to hit each one of them on a selective basis.

As a matter of fact,

John is where we're working on the major settlements, as you know.

And he's one of them.

When I visit the Productivity Council, as I, of course, will be speaking to the problem, I will be speaking to the problem in question.

Second, with regard to our effective policy, which, of course, we will have to deal with tomorrow, I mean to the one that

And this is not addressed the way he writes them.

It addresses something else.

If I've got to meet through a bill for exonerating public works, it is worth a damn for the present problem.

I've got a signing on it.

It would be great to read it, but nevertheless, one that addresses itself specifically for employment in the present time because it addresses itself for teenage and general and all that sort of stuff.

A temporary bill for...

for jobs and so forth, which is hard and a lot of what we want to know about us, not what we want.

So I'll veto what I'm signing.

I'll veto the one on the ground that would be a questioner.

And it's because of that, on the ground one, the company would be a questioner, but it would not address itself in an immediate problem.

The client would be a questioner.

And later on, when we were over the hump in the client signing, that would not be popular.

The veto, I think, would be sustained.

And that will be an opportunity to speak to the problem of inflation.

I will speak to it then.

I will speak to it in the following sessions.

And I will speak to it in terms of another very tough bill that's coming up, blue-collar rates.

One thing that you did, and Paul, let me say that on that, we haven't got it yet.

We shall see how it comes out.

It's just that we don't want to stand about to beat together because we want to try to beat them before whenever we can.

But one thing you say makes a great deal of sense, and that is that the upward pull of federal salaries in terms of government employees generally pushing it up, the main pull is the pull of the federal salary.

The Post Office is going to have another unconstitutional increase with the family.

We do want them to be on the side of the administration, but we don't want them to do as good a job as they can.

But we're going to have to face it in terms of blue collar workers, special, which I vetoed last year.

So I'll be doing that.

There again, speaking to the wage price, on the ground, you cannot kick up the federal scale

which has gone up 25 percent.

You talk about deflection periods.

Federal employees have gone up just as much as deflection periods over the last few years.

So we're getting at that.

On the other hand, I am not going to go the line, and this is said with all due deference to the recommendations, which I think are, as I said, I read everything.

I take it very much to heart.

But I'm not going to go on the wage price board.

And I'm not going to go on the wage price freeze.

I don't mean to.

I'm not going to say never.

I'm not going to say that.

But I've got to indicate to Arthur now that right now this is what we're going to do and then stick to it.

Because otherwise you're going to have an uncertainty around.

Well, he doesn't know what he's doing.

He's tough.

He's unclear.

So, just to summarize what we're going to do, Chavo, yes, maybe we won't call it that, but it'll be tough.

We're going to play the tough one.

Sandy, another thing we're going to do is, you're not going to like it, I don't think, and maybe you will, I don't know, but I may have to do something with regard to warning courts.

I can't do it.

You're going to work on that.

Now, that at first would be a place, right?

Could be.

All right.

But, John, and before we mention

strong feelings, but, because I've asked you for a list, but we've got a hell of a problem here, a political problem that I didn't, I didn't, Congress never passed a court bill.

And if I were sitting here, I'd vote for it.

I think I would too, this month, I mean, last month, announced today, and we have a second month in a row, and we have a negative balance of trade, which I don't, I mean, of course I do, but this is, but the problem we've got, Arthur, really gets down to this.

I can't really keep the discipline, and I am going to insist on discipline in economic policy, within the cabinet and the cabinet committee of the rest.

And John is not going to be able to do this, John.

I understand.

When I say he's the spokesperson, I mean I'm not going to speak.

But I can't go to the well as he can.

He'll keep going to the well a couple times a week.

I can't do it once a month.

Like I can go on national television prime time only once a month.

And I'll do a wage price thing.

I'll veto a bill.

I'll do so-and-so.

But I'm going to be spending an enormous amount of time in the economic field between now and the end of the year when we get to the budget thing, where we have a real problem.

The budget at 73 is going to be one hell of a problem.

We worked on it for two days yesterday, two full days at Camp David.

And as John will tell you, we're going to make some awful tough decisions on that.

I think the announcement of that budget is going to be salutary if we come out the way that I presently intend to.

Right, John?

We shall see.

But now, the critical thing is that, getting back to your point, is that when you say something that is at variance with what I say or what John Connolly says,

And the others are typically unapparent, believe me, or they aren't going to be in the government.

They'll be out just like that.

They're unapparent to lie.

Not to me in their private conversation.

They're there to say anything they want, from one extreme to another.

And I've got all the extreme represented.

I've got the lazy, fair people, and I've got the people who have wage and price controls, and I listen to them all.

But we cannot control a thing publicly and appear to be speaking by one administration.

are in the position.

You and the people in your shop.

And it's more you, basically, because you're the ones.

You have an enormous reputation.

You have great influence in the Congress.

You can't even speak to anybody in the press or in the rest of it, but it's going to be reported.

And they'll say, well, Dr. Arthur Burns is the president.

Now, let me just differentiate between two different things.

Monetary policy, that's something where, of course,

No matter what kind of counselor or so forth you've got to call them and you see, we'll indicate privately what we do.

But publicly, we're going to try to maintain the proper relation.

But when we move into these areas, well, should we have wage and price control?

Should we have a tax cut or a tax increase?

Should we have a budget cut or a budget increase?

Should we have a new economic policy and all the rest?

It seems to me that we'll be in an impossible position

if you present those things publicly, if I have made a decision as I have in this instance to move in another direction, because if I make a decision to move in another direction, it will simply be an indication that

And they'll inevitably say, not just the head of the Federal Reserve, but Dr. Hartman Burns, the president's friend, close counselor, and so forth, disagrees with this and believes that we should be under economic policy.

That's really the way it is.

Now, John, I think that's the concern that I expressed to you.

Well, but I don't know.

No, I think you're absolutely right, simply because of the position you put your finger on it.

Obviously, I'm not making it possible.

I think

I'm going to say what your policy is.

I'm going to try to articulate your policy as best I can in the forums that are available to me.

I think you stated it perfectly well that Arthur occupies a unique position in this town and in this country.

And to the extent that he takes a contrary position to what you do, it creates a great

a great concern and a confusion that reminds a great many people.

And I just, I just have to pick up.

I've read it at least three or four times.

Except for the secret documents.

But I happened to be here this week, and I'm sure you haven't seen it for years.

I don't hear, I don't know whether you've seen this or not, but there's more on the page, economic malaise, trying to pay some answers on the way.

And he gets down, and he says, seven, six months ago, a pest, his heart had burned.

About nine, he was inspired by that one program, the address of Capernaum College.

And he said, the heart of the plant.

The advocacy department is growing constantly, and Dr. Burns himself is now even more strong than the paper.

Some sources are now going further than Dr. Burns.

In 2015, there were about five articles of this kind in the paper, and the truth of the matter is that you have a rapport with the press, and you have it with the Congress, and whatever you say carries a tremendous weight, and the President

So, I think what is stated in different ways, and I think the President stated it very well, but I think he's just asking and saying, you can ask and say, some new cooperation, at least in these areas that are not directly concerned and related to the Fed itself, but in effect asking to support the policy which he's already adopted and laid down.

I don't agree with you, John.

And, uh, I've got to make my position clear, Mr. President.

I don't agree at all.

Well, gentlemen, I will explain my position.

Now, first of all, Mr. President, the, uh, you and I had a very intimate talk just before you went off to Tom Dewitt's, you know, remember that?

Mm-hmm.

Yeah.

And, uh,

You and I reached an understanding there.

Now, I want you to know that I've not gone one inch beyond that understanding.

Whatever new thoughts I've had about economic policy, you see, I put before you, I put before others in the government, I put before some of my colleagues, but by no means all,

of the Federal Reserve Board, those whom I can trust, and I have not spoken publicly.

Now, you see, here is my problem.

How does this kind of stuff get out there?

Oh, heavens, I made that speech, I made that speech last December.

I've testified and refers to a speech I made in December.

Now, that speech has been very widely quoted and referred to over the country.

Now, I'm called upon to testify frequently.

I'm going up there Wednesday to testify again by the Joint Economic Committee.

I can't be strong on my own credibility and remain in this government.

I've taken certain positions.

If I thought they were wrong, I would honestly say, well, I've had a change of heart.

Well, I haven't had a change of heart.

Now, I will have to address myself to the subject of wage and price policy again when I testify on Wednesday.

I have no choice.

Now, I'm an economist of some reputation, as I think you know.

I've testified before these congressional committees for the past 20 or 25 years.

I've got to act in Canada, or I'm of no use to you or to this country or to this government or to my family or to myself.

I'm not a member of the cabinet.

I am the head of an independent agency.

I am an economist who has established his reputation for plain speaking on economic issues.

I can't act any differently.

Now, you take this letter that I've written to you.

That's not going anywhere, you see.

But what I've already said about income's policy, I can't go back on it.

Now there's going to be a hearing very soon before the Senate Banking Committee.

Never have dozen bills up there.

Calling for ways in which review boards.

Coxmeyer wants Sparkman to set a hearing.

Sparkman undoubtedly will.

I'll have to testify.

I've been told so.

And how can I go back on everything that I've said?

I can't.

And I won't.

You should justify that I am not going to support it.

What's that?

You would have to, if you're asked, you've got to say that I'm not going to support it.

Well, I...

I should be very clear.

Well, I don't want to support that.

Because we've got to have a clear understanding.

I don't want to do it except when you give me permission.

Yeah, well, you have permission.

As a matter of fact, it's very important.

You can't go up on it because you see it's

No, no.

You see, when you give me...

I never want to quote you because I could just embarrass you.

You tell me what you want me to say about your own views, and of course I will.

But you will not support me.

Of course I'll say that.

Well, Walter, I think to take the contrary position, number one, as you well know, you don't always have to go when you're planning to testify.

Number two, when you do go, you can frequently say, now, this is a matter that I have some opinions about that's trying to affect a couple in the province of my authority and responsibility.

Well, not to throw it out there, but... Now, if you insist that you have to do it, then I think you would understand the president taking the position that he's going to make it abundantly clear that you

Oh, I don't.

I don't.

Well, actually... Well, actually...

The...

I didn't know that, and I doubt if that's true.

Some people may think that.

No, that's true, Arthur.

That's the way it is.

No question.

Well, how can I speak for the administration on income policy when I've been talking about it for a year and a half?

And when Kennedy and others in the administration have made it clear that I was not speaking for the president or for the administration.

Your voice is heard loud and clear.

Well, I will say this, that you've been very effective with you.

That's right.

You just keep people talking about it, and you keep generating that heat for it.

I think you couldn't be more wrong.

I think what is driving this country is events.

It's not my voice.

And I want to make a forecast, Mr. President, I think sooner or later we'll have to move to incomes policy, not because I've advised you or because John advised you or anybody else, but because the events will drive us in that direction.

Well, Arthur, I've got people that predict a hell of a lot worse than that.

I think we ought to go to wage and price controls right away.

See, the whole point is this.

Look, who's got the responsibility?

I have.

Of course you have.

I have.

But don't overlook one thing, you see.

In my own way, nobody has tried harder to help you.

I understand.

Now, you think, and this hurts me, but we must be frank with one another.

You think I'm injuring you and your policy by what I've done?

No, I'm only in the sense of the uncertainty that it creates.

Well, all that I can say is I, in my judgment, I'm the best friend you have in this area.

Enough.

Well, I understand how you feel about your policy, and I know how strongly you feel about it, and I also know how effective you are in selling it.

And I must say, I've looked it over, and I've considered it, and I am not taking that position.

I thoroughly respect that.

Who knows who is right?

I thoroughly respect that.

I have to live with it.

And God bless you.

Now we all have to live with the decision.

But I think what we have to do then is to have a clear understanding that you are representing your own views, that you are not speaking for the administration.

And I would hope that those...

that in statements in this field, it could be recognized that there is a really great danger, as far as policy is concerned, not whether it's right or wrong, but whether there is one.

And at this point, the question as to whether there is one

He's ready at this point to have more than one voice speaking out.

Now, there's going to be more voices from the administration, I can assure you.

They're going to pipe down.

They're not going to say anything on him.

Well, I think you're entirely right.

And John Connolly will make that one thing clear when he goes out and talks to the press tomorrow after 10 p.m. Yeah, 9.30, what time is it?

Oh, I... Oh, yeah, I'm not going to testify.

Thank God, I'm good.

I'm not sure that that would be a viable way of working it out.

I think it's going to cause difficulties.

But I think John has put his finger on it.

It's going to appear, I think you have to realize, it's going to appear that there's a major split between the president and the chairman.

I think that's unfortunate, Mr. President, and I'll do my best to try to prevent that from happening.

Bill Martin, you know, used to be able to do that, but it didn't make a hell of a lot of difference.

He was always out to...

You know, he'd get out and say, the budget's too high or the budget's too low.

You should have thought it was too high.

And he'd make about a couple of speeches a year and have a hell of an impact.

But nobody really, everybody expected him to do it.

In your case, a major split, I think, was very unfortunate.

You can see what I mean.

Well, I'm going to try my darndest to avoid them, Mr. President.

But I cannot possibly, you see, I cannot possibly act out of character.

I cannot possibly, when I testify on Wednesday, you see, take a position on income policy other than that which I have taken and which I firmly believe.

Now, I go much further in this letter than I've gone in public or than I intend to go in public.

That's something else again.

Now, maybe I shouldn't have done this in the first place.

I think that's debatable.

But I've done it, and now I have to live with it.

Well, Arthur, without...

I've got to act in turn.

Without putting words in your mouth, I think you said a moment ago that you are not for mandatory wage and price controls now.

I'm not.

Well, you'll be given an opportunity to say that if you have to testify on Wednesday.

If they ask me... A statement to that effect would help.

If they ask me that, I will say that in the plainest of language.

That'd be helpful.

Because, you know, a person may be born someday under some circumstances.

They may hope not.

I hope not.

You never know what's going to happen a year from now.

But my point is that he, Arthur, would not now recommend wasting tax controls.

But when he says, I'm for it.

Institute of Income Policy.

No one is quite sure what this means.

Well, I spelled it out in my Pepperdine speech in a dozen propositions.

Well, I know, but you're not for installing it now.

Well, I wasn't for installing it.

That's correct.

No, I'm not.

No, I will.

I will dissociate myself from mandatory control.

That's my question.

I'm sure it will, and the opportunity to say it will certainly be available.

And I think this is part of what we're concerned with, because in the first place, no one is quite sure.

In your case, they do know what you mean by incomes policies.

They go back and read your prepadine speech, but for the most part, when the columnists use it, they just talk about the income policy and don't define it.

Well, this means that to some it means a wage price board.

They don't know what that means.

And to others it means wage and price control is mandatory or otherwise.

But they don't know what that means because they haven't been found out.

So that there's a general confusion in the minds of people.

Truth of the matter is, you're not an afferent in a position of wage and price control.

That's correct.

So if you set that, I think it would go a long way toward a court clear of the error.

And that's what I'm saying.

Well, let me say this.

Why don't we leave this?

It's good to have this talk.

John, we've got this worked out in the administration.

It's clear now that I don't think there's any question.

Second, I think it would be very helpful if you and John, on matters that I'd like to probably have him up there right after you, that have a

very candid understandings to first what we're going to do, what we've decided, and try to work out, to view as much as possible, the differences that would be blown up by our critics into major break between Burns and administration.

That's what they're going to talk about.

You and I had a meeting just before you went off to the Tom Dewey funeral.

We talked about the gossip around the White House and so forth about monetary policy and so on.

And I told you then, you see, that I will certainly over the next few months, I will not say anything, break any new ground in economic policy.

Let's have a period of peace.

Let's have unity.

And I respect that completely.

Now when people keep on writing, you see,

They keep on writing on the basis of what I've said before, and which I have repeated, but I haven't broken new ground.

Even though I have in my own mind, but I haven't broken new ground publicly.

And I have no intention to.

Does this represent your best statement at this point?

It does, Mr. President, and all that I can say to you is... That's an investment tax credit, isn't it?

to feel that that's not realistic to get at.

You see, the problem is not serious.

I gave you a set of tables.

And I wrote you that letter.

I had already stated my position, but I wanted to analyze.

I wanted to analyze the changes that have taken place in our economy.

Well, I appreciate that.

This summarizes what you said.

It's a very good job.

Now, in my judgment as president, we've been living in a fool's paradise, thinking that we are making advances in the fight against inflation.

interpreting every little improvement as if it were a significant improvement, ignoring the setbacks or minimizing them.

If you look at the record objectively and comprehensively, and you've got to know how to do that, and not many do, I think there's only one conclusion, the one I put before you.

Now, what you do about it, well, that's God's realm or the presence realm, you see.

That's right.

God's realm, yes.

Well, he's not communicating very clearly.

Well, I'm helping you, even though you don't know it, my friend.

Oh, no, I'm not.

We're not complaining about you, Sony.

There's nothing to do with that.

Well...

It's simply this.

What are you talking about?

You have the impression you wouldn't have brought this up, let's be perfectly frank.

Oh, I brought it up with the whole candidate.

No.

You have the impression that I've been doing talking of a kind that is embarrassing to you.

And I'm not denying that.

What I'm saying, the talking that I've done, is not in ground.

Well, shall we leave it at that?

John, you've got to, as I say, as we get to San Clemente, we're really going to be hammering out some stuff.

I think it would be very helpful to be candid when I veto those.

For example, when you ask about, you see an action that takes as much guts as that, you might say a word about that, too.

Oh, boy.

Now, you were there when I talked to the President's courage and unit.

You were sitting right there.

I've done it on every occasion that I could capture.

What we're trying to do is basically we're fighting a constant battle, I guess, with the financial press.

And they have a hell of a time trying to probe here and there and every place.

I think we understand the situation.

There's one thing more that I...

Very, very persuasive.

Yeah, and particularly, as I said, because curiously enough, on that way to push government employees, or that one who we've got in front of us, I don't know what we can do about it.

Those comparabilities run too far.

We're going to try to turn it back and pray for people.

Mr. Rosen, I want to talk frankly.

Well, one thing more.

I'm not going to put words into your mouth, but you've said, meaning what you've said is, I ought to be talking about monetary policy and stop talking about everything else.

You've said the same thing.

Nothing goes worse, but that's what you're getting at.

It's impossible.

Look at the way, you see.

It's impossible, particularly for me.

As an old economist who's been testifying before this committee, who has written, you see, a shelf full of books that they keep quoting, you see, can't do it.

Now, John, when you testify, they ask you questions about monetary policy.

You don't like it.

What you find, you just have to deal with it.

They ask me questions about everything under the sun, you see.

And the only failure...

where I can really stay part of his military policy.

I'd be acting out a character if we talked about that.

So it's difficult for me to carry that out.

Well, it is difficult.

Now, I think about the best you can do.

You obviously can't do it.

It can't be what you've already said.

I know it.

I think the most you can say is, now, gentlemen, you all know my views.

I've testified here many times, and I don't think it's hard to give some purpose to me to recount what we've given to you today.

And I'm not trying to articulate this administration's economic policy or something of that kind.

That's all.

You can't go back on what you've said.

You can't be true to yourself.

I will certainly try to make it clear.

that I always speak for myself or for my board, and what my statement should not be interpreted as the administration's statements, and I can go on and say I know the president reputes this or that view as an income policy.

I can say that now.

And if they ask me on Wednesday, I will.

Well, as a matter of fact, you won't have to.

Wait, have you done that?

Because I don't want to say that you're a mediator before.

Well, you say it tomorrow, and then I can repeat it on if they ask.

He doesn't say it tomorrow.

Well, he's not going to say what we're going to do.

I would hope that I would say what we're going to do without saying that I'm going to be disposed of as president.

I don't think I'm going to be if she comes to me.

If someone has to come to me, whether it's a lawmaker, it should or should not come to me.

No, that's right.

I'll take that.

I'll take that because it's me that's coming to me.

I don't know how that ends here.

Oh, yes, about the inspection of substance and the policy, I'll certainly make clear that, yes, that what we are proceeding on, yes, certainly, yes, on a certain line, yes, and then you see, you can say, as you will note from the Secretary's statement yesterday, that the President has made his decisions to go forward on a certain ground, on a certain line, and it does not include an incomes policy.

I mean,

That's such a broad term.

It doesn't include a wage and price agreement.

A wage and price agreement.

That's right.

The President is proceeding in other ways.

But I think you could say he is working at the problem.

In other ways.

He's working at it to direct action where major wage price settlements are involved.

You're working at it all so true.

When you talk about incomes, the wage price for it basically is jaw-bone except that you lay it out.

Lockheed is a major income policy position.

It's jaw-bone in individual industrial cases.

That's what a William Rice Review Board comes to.

Well, we will be doing something.

We may be doing more than that.

We may be doing that in major, well, we will be doing that in major settlements.

So we may not be as far apart as you think.

What I'm getting at is that I want to keep the option to know which ones to keep.

That's the real point.

But it was Steele, that's for sure.

I can tell you that now.

Of course, you know, if you did...

I want you to say Steele, because I'm going to call him.

You say you do want me or do not?

Don't mention it.

All right, I won't.

For the reason that we haven't told them yet.

But we're going to call the steel people in Tuesday morning, and I'm going to get them out.

That'll be the first.

And the next one will be, we'll pick them off one by one.

So sometimes I'll do it, sometimes he'll do it.

There are ways.

Well, anyway, you guys got to get to work.

Three, two...

I just want to be sure that we have an understanding, Arthur, so that we can...

I've got everybody else...

I understand your position is different, but you and John are the key to this now.

I want your relationship to be extremely close.

Extremely close.

And then we can avoid this thing.

And incidentally, we're aware of the fact, we're aware of the fact that the press will take any hand with the thing and blow it up.

You will testify and they'll hold that up.

But we've got to.

I'm going to be speaking out as a great deal more about it because we're now in a period in between.

Congress will be out in August and have a lot of chance then.

So we'll hear some more from him.

But you just, whenever you've got news, send it in.

And they'll kind of go with it.

I want it.

Straight, just straight from the shoulder.

I don't want you to be great with it.

Yes, you do.

Say the same thing.

Mike, we have no news.

All right.

Okay, I agree.

Bye.

Thank you, John.