Conversation 538-008

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Well, that's an approximate time.

We'll have a report from the Kraken on this background stuff.

We'll have a report from that.

from the Western Europeans on their quota.

We'll have a statement from Jim Hudson about their readiness to help with mediation and so on.

Peter Flanagan will be in the meeting.

And as he sees Jim is about to complete his report, he'll come on in and let you know that they're ready.

And then we thought after, when you come in, you probably want to shake their hands.

And then the press is invited to come and take pictures after you sit down.

And then they leave and you make your remarks.

And the thought was that you would just make your remarks and then leave.

And that would be the end of the meeting.

There wouldn't be any discussion.

Thank you.

I'm wondering after looking at the thing how we don't have to, what we want to have come out, what do we want to say?

What I mean is, what do we want them to say?

What do we want us to say?

It's what is said about this meeting rather than the fact that the meeting is going to have to come out at all.

You know, get them all, get them settled eventually.

But the question is, what do we want to have said about the meeting?

That will sort of orient what I want to say.

Yes, whatever we want to do.

We don't want us to believe that we're not here to work.

We just want to work.

We don't need to start this.

And that is basically the national interest.

You can't get a worse thing than a strike.

I think it's important.

Well, I think that they are not the...

This industry is...

Well, I think the

thing that seems to me would be most helpful to have come out of the meeting substantively is that you recognize and you hope they recognize that they have a problem to a degree they feel the problem the most but the whole country has a say in the vitality and strength of our steel industry over a period of time they so

You recognize they're getting ready to start their negotiations about an immediate situation, and you're trying to tell them exactly what to do in that situation.

Except that they should realize they're negotiating against the background of this long-term problem.

And somehow, out of their negotiations, you hope that there will be some constructive thinking and some

effort to figure out whatever wage settlement they make, how they are going to deal with that problem.

Now, beyond that, it seems to me you could say we're willing to help.

We are trying to negotiate this quota agreement in their interests.

But it is a short-term proposition.

And the point is, during the time

allowed by such a quota agreement can constructive steps be taken to make them more competitive in world markets and to produce a situation where the u.s firms that use steel are not put at a disadvantage in world markets

In other words, I think there's a big element here of saying that if what we have is a quota system that raises U.S. prices of steel above foreign prices, well, all that means is that all the auto companies and all the people that use steel in their products are priced out of world markets too because their materials prices get so much higher.

So there's a really, they're cutting their own market down and somehow

the constructive thing is to is to get our our costs in line productivity is something to uh in a word i think worth using productivity hasn't improved much in the last five years in the steel industry plenty reasons for that but somehow between labor and management there's there ought to be some thoughts on that subject i think

in the interest of equity, but we don't seem to be giving a lecture that buttresses management's posture at the bargaining table, that it's well to point out, too, that you're aware that real wages in the steel industry have not increased over the past three or four years, and have, while high, haven't risen as much as...

in money terms as the average for manufacturing.

Well, you can really say productivity, that this industry is below par in productivity, below par in increase in real rates, and below par in profits.

All three.

And making the statement as over the last five years.

Five years, that's right.

And they're changing those things, and that those things are all tied together.

And I think some of this initial business on the mountain top is very good for everybody.

Yeah, it probably helps them.

Yeah, it helps.

I think it's a good thing.

What is it that they, uh... No, there's some...

uh the uh

With regard to the unemployment figure, do I understand that taking the BLS statement, are they in effect saying that the 5.6 figure is wrong, or that the 6.2 figure was wrong, or that both are wrong?

The question is not in effect.

They are saying that the drop does mean anything.

That's what their statement says.

Which one is wrong?

Are they saying that they are wrong, indicating that it is now 5.6, or that they were wrong in saying it was 6.2?

I think that's the thing I'm trying to figure out.

And if so, why don't they up and say it?

See how they get that?

I think, in a way, both figures, according to them, are wrong.

But there are two different reasons.

One has to do exclusively with the 5.6.

namely that the week that they took the survey was earlier than usual, and therefore the kids weren't out of school, and the seasonal surge in the labor force hadn't occurred yet, and yet they allowed for it in their seasonal adjustment factors, because the seasonal adjustment factors are just like so.

That is one allegation.

by the same token, if the seasonals are not right for this year and are wrong for this particular month, they're also wrong for all the other months because they have to balance out to 100.

You've got some cases where you adjust up and some cases you balance out.

In your analysis, though, as far as the overall situation,

that there was some, not as much as 6.6, that's the point, but there was some improvement in the employment situation.

Yes, sir.

Something slightly improved.

Well, I think that the, that there had been improvement in the employment situation since the first of the year.

Yes, that's the point.

Not every month, I agree.

It happened to show up because of the way of the service.

Do you think what has happened is that the unemployment basically has, may have popped out

the first year, it doesn't mean it won't jiggle up and down in the summer, but if you look at the charts that you've had, three to six months after an up year, employment actually inevitably reflects, and I'm not gonna ask one other thing, do we have a retail sales figure yet for June, or when will we get it in 15 days?

Well, we have various testers, indicators and estimates for the first three weeks of June, and they look pretty good.

And furthermore,

You see all sorts of things like, for instance, the story in the papers in the New York Times this morning, the financial page, basically reporting on the buyers in the garment industry and how they've come in and they're buying heavily.

And this looks like the biggest summer in a long while instead of that and that kind of thing.

You just get those little bits and pieces later.

You know who the buyers are, too.

I learned from Matt all over the country, sure, of coming in to buy this.

But at the present time, George, they're not.

whatever problems there may be with seasonal adjustments

The problem affects the teenagers only.

This business of leaving school.

Only the teenagers.

As far as the adults are concerned, adults 25 and over, unemployment declined.

As far as married men supporting families are concerned, they collect that.

Unemployment declined in this past month from 3.3 to 3.1%.

Now that is really significant.

And we know that.

You better be on the spot for it.