On November 24, 1971, President Richard M. Nixon, John D. Ehrlichman, John B. Connally, and George P. Shultz met in the Oval Office of the White House at an unknown time between 3:35 pm and 4:06 pm. The Oval Office taping system captured this recording, which is known as Conversation 624-029 of the White House Tapes.
Transcript (AI-Generated)This transcript was generated automatically by AI and has not been reviewed for accuracy. Do not cite this transcript as authoritative. Consult the Finding Aid above for verified information.
This is how we can get through here and on over.
So, you've got time.
Can I ask your office?
Yes, sir.
Talk about it.
Table and colors, my best condition.
What do you do with your time?
What I want to ask, one thing I want to ask, if you want, would it be helpful at all, or do you think it would be wise, if, to have it in Iran, do you require that they look it up, or do you think it would be better?
Well, Mr. President, I think he's in proper shape.
Frankly, I don't think a memorandum would help us.
Yes, I think we're going to have to tell him.
I'm sure he didn't see the fight.
One of the reasons that I had him go on the safety department was to him.
Right.
Correct.
But we don't know.
In fact, if we don't, we're just going to have a hard time.
I think your, I think his point about having something, having a positive note come out of it, you can't do it.
But I have confidence in him.
Well, that's what he argues.
Oh, this is another one.
Before we, what the hell?
That picture, Ziegler, I mean, oh my God, I,
It really wasn't.
He came to me and pulled out a quick market service story in which Ziegler, yesterday or this morning, was asked whether or not the subject of the discussion between Burns, the president, and me was going to deal with market requirements on the stock exchange.
And Ziegler, obviously, replied, no.
And for her to just hit the ceiling.
And he said, now we were prepared to do that today, but now I'm not going to do it.
This puts us totally in a completely embarrassing position.
And the president said, well, why should you even say that?
I got so shocked, I didn't know how to do it.
And he said, well, he said, why should you even know anything about what happened to the table?
He said, I don't mind talking to you about it, but Sagan's not supposed to know either about what happened to the bed.
I said, you're right.
He said, this makes it impossible for me to do it.
But I said, well, suppose, I said, well, now look out here.
I suppose he, suppose he had said, uh, yes.
I said, now that he said no, you would have gone up and said yes after a period.
I thought that would have been it, but it didn't.
No, no.
He said, well, he should have said that, uh, I cannot discuss anything that was going on in terms of what was heard.
That's what I can't.
Now what, Sager came to a totally appropriate answer, didn't he?
Sager could have said, well, I don't know what they're going to discuss.
But on the other hand, I'm sure he came quick off the top of something.
The reporter said, Sager probably doesn't know what the hell the Washington requirement is anymore than I do.
But he said, but it is so that he said he's going to discuss the Washington requirements.
We said, no.
Well, how would, because he knew we were going to discuss the International Monetary Fund.
But now he doesn't.
I have to go almost straight ahead and hit him.
I hope it's so unfair that we went through that this morning.
Right.
That's true.
And I didn't mention it because they never, John Roe, just incredible.
And he said, he said, well, Ziegler, Ziegler's got no place to talk about the Fed.
He should have said that the Fed's an independent agency, and we have nothing to do with it, and I don't know anything about it.
And the president thought, I said, well, he said no.
which means that you cannot go to where you want to, which are any part of the intellectuals, not independent.
And I said, which is also hard, when he said no, which means that the White House is not for sure if you want to go to where they are.
That's right.
See?
But he said, well, we're not that good.
Yeah.
That we might.
Period.
And he was looking for an excuse.
That's right.
The one thing I think we ought to have some more talk about is, before you go, John, is to get something that feels about the advantage that you've pointed out.
So is my Walmart account, and your Walmart account.
What do we have to decide now?
Do we have to study now?
Yes, sir, I think so.
The problem is there's so much to do to get this thing in shape.
There's so many bugs to come out that we pretty clearly didn't need to know.
We didn't want us to go forward at this point.
Now, that doesn't say we can't back off from the nature of things.
But you have to make a study.
Well, I have to.
Otherwise, we could decide to reduce it.
Well, I just...
And you're saying the whole thing about I just don't want to do it.
Yes, sir.
Now, that will end up being around.
It's already seeking out some.
Oh, sure.
And the fact that you marched up to it, marched away, and then it's already in.
That's not particularly.
We marched up to it last year.
That's right.
This year, much more.
But he put the case very briefly so that John and I, as you presently see it, as I mark those little options, as to what we're looking at here.
Well, first of all, we're looking at value-added tax on a one-of-two basis, either at a 2% or 3% or 4% basis.
The proceeds of that going to the localities, or to the states, excuse me, to be distributed to localities on a per capita basis, per school child.
The states not qualified for the money unless they agree to eliminate real estate tax for education in the states.
same thing through localities, or it's a matter of local options.
Real estate tax support of education.
Well, the primary incentive.
Because real estate is limited to just the real estate side.
Oh, I beg your pardon.
That's right.
That's right.
Residential property.
Residential property.
Okay.
And where agriculture is involved, that would mean carving out a home place on a large piece of land.
Like a homestead, right?
Exactly that.
Taxing your balances as business.
than the distribution to the locality.
Well, first of all, distribution to the state formula, which is proportionate to the state's present allocation of its resources to education.
Now, there's another way to go, isn't there, Arnie?
And that is there should be a program that's just countrywide.
But frankly, we have targeted our key states.
We collected the formula that benefits them, and that's the reason why we loaned the way we had.
The repayment to the citizen comes in the form of a lowering of his real estate taxes, which we propose to be mandatory.
Now, I think that there's an argument that George first made to me early on that I think Eddie is now making out, but I'm not so sure George is still on this.
I know Peter's lying in the fields.
We should not tell the localities that they can't levy the real estate tax.
That we should leave a local option to say, here comes this money by revenue sharing.
And that is antithetical to the philosophy of revenue sharing.
To say to the locality, you must remove the real estate tax.
which is over to education.
The reason that we have it this way, we've had it, we've agonized over this.
We now think that the political goodies in this lie in the direction of tangible, visible removal of real estate taxes associated with the president.
Otherwise, we're going to have, we just have all the business of our local law to progress.
And we have to first recognize how it's going to happen.
with all of our local options, you can talk to your building and base and say, well, this will provide, should provide at some stage, you could never sell.
Because I know these things.
You know these things.
Well, and our problem here is when we go to the communities and talk about recognition, people say, well, I've had people do one of the other things, but you don't release the first thing you've had in this thing.
These folks in our local department are really wrong.
And that's the argument you get.
Uh, now, uh, well, the argument, the Biden-Johnson decision, if you were to apply that this morning, would you say that if a new tax were a substitution for an old tax, you might leave it?
And that's what I think this has to be, or I don't think we can consider it.
I don't think you can consider it at all.
The first thing you now have is, as we've discussed this morning, you now have a budget that will be about as simple as a fund.
But you really don't need a tax.
And you ought not to have a tax.
It's a matter of general proposition in the election year unless it by itself has some particular appeal.
And the only appeal that a tax can have is a substitution.
for the existing tax.
It's less popular.
Now, you're not going to get the tax.
That's your ending point, and I think it carries a great deal away from me, is that you really ought to use this idea, not as a submission to Congress, but as material and an idea for a speech and for the campaign.
Don't put it into the form of the way it needs to
where Wilbert controls hearings and structures hearings the way he wants to, and it affects the state that you try to preempt the sales tax.
He'll call it the layman's sales tax.
It'll preempt the states and their sales taxes, build up a lot of opposition from them, and he's going to go over it.
He'll conduct hearings almost as far as he can use it for the proper kind of purposes against you.
And the thing to do with it is to lost you.
Watch it when you get to the school report or hand it over to some other key, whatever.
Watch it.
Watch it.
Here's a possible that you could watch it.
You've got to figure this, John.
Just a thought.
You may have a point here.
Looking at it in a co-political way, first of all, the greatest mistake you can ever make in politics is because you have to make speech, do something that is wrong.
now now this and that's what we always do in the first time like we had a big speech and so we had a big environmental program and then we had a big speech so we then we had an irreverence now we've got to have a stage and so we've got to have something to do so we go to this i understand i i put it in this worst side we probably should have gone with the environment but we should have gone to a certain extent we removed both of the content
And it's insane, but the fact that he had a speech today, well, what are we going to do for, for painting this year?
Now we are, in my view, I don't feel we should make that mistake this year, this early.
I'm just arguing this case, but here's the reason.
I remember the great excitement at the time we put out, uh, the new American Revolution.
By that we kept people excited for about four months.
and reorganization.
It was a damn good program, but since then we've had one hell of a time, because the Congress has talked all around it.
I remember the very great excitement that we had on the environmental program, about the state is good, the quality of life, what we're going to do about the water and the air and all the rest of the things out here in the backyard.
It lasted two months.
And then, as far as our program is concerned, and other things came along, it may be that what we should do
with this committee, if we consider to go, is to put it much closer to the election, to say on the 1st of May that, just as we get toward the end, before they can have it, that might appear on the 1st of June, particularly for a broken school thing, about a month before the Democratic convention, come out with this new proposal, a proposal for a
vision of taxes.
By that time, of course, we will have seen that the Congress has not done a lot of the thing.
Now, that's another way to go and then present the whole program as a substance, as a way to practically lead to a substitution of this kind of tax.
Having said that, if we consider it as a good issue, the issue will be very substantially
debased by the way Mills and all will handle it.
And also, it will be very far away from November to advocate for January.
That's the political argument we're going to be having.
Now, the political argument, there's another argument in this way.
I don't know what the hell else we can have for a centerpiece for next year's State of the Union.
And maybe, maybe we, maybe we must look for a centerpiece.
Maybe that's too early for one.
Maybe you could go with the other things we have, you know, I mean, your, your, your, your, your, your, your, your, your, your, your, your, your,
a presentation that needs a centerpiece.
It might not even be literally that statement.
You know, it's a very, uh, like, it's a perfect minute.
Where are we going?
Making the, making the new economic policy.
That's right.
You've got to start a foreign policy.
That's the point.
It's like foreign policy.
We've got to do domestic policy.
That's right.
Hold that kind of thing.
Go ahead and get a nice, monetary thing settled by the end.
Kind of go ahead and talk about it.
Well, if this sequence is possible, if you understand it, or if you can back all of that up, or if you can lower it, or if you can do what you can do, I haven't seen no catch to John.
I'm racing the curtain a little bit on this guy.
The Secretary of the Territory has some very, very interesting ideas of these things.
And what I would do is either I would press conference or John would press conference.
Probably preferably him.
He would go to the press conference.
He would say that what happened to the tax department.
He said, it's very much, we haven't had, we're waiting for the school report and so forth.
A very exciting thing.
A very, we will ask the recommendation to mention the president in the spring.
So, remember I said earlier, the president said he would have some tax department versus here.
But the one thing about the tax thing, too, John, do they think the tax rate is bad?
And putting it in the budget is totally not credible in the budget.
It just isn't credible.
That's right.
It is not going to pass.
Bill Rebels will just knock it out of the way.
You see, take good friends of ours, like Joe Ossoff, you know, he's a real pleasure to talk to.
And he was right.
You see, he gets right.
He thinks this year.
But I think what we can do would be to pave the way for this.
The Congress will never do it.
And you know, you don't see Bill come up with this kind of approach.
Not until he's out of that birth control position.
You know, that's right.
Well, it isn't really what appeals to his constituents, you know.
You see, the property tax group, basically, let's face it, are the thoughtful people.
Frankly, they're responsible people.
And the kind of people that, frankly, live in government housing and rent and so forth, vote Democratic in the big cities of the North.
Right?
Maybe he's got a point.
Maybe he's got a point.
And also, I think we could, John, yeah, but it's very, well, I think the further one is, he should have been a pastor in January.
to hang everything fresh three years on.
They're going to get back into the place.
They're going to get back into all business taxis.
They're going to have four different libraries.
I just wonder if we should have a basketball next year.
That's my point.
And I wonder, too, if it doesn't pose this problem, John.
You know how I've been thinking about this.
I like the excitement of it.
in terms of much more drastic change.
I frankly think the corporate tax is too high.
I think the income tax is too high.
I'd like to get a lot of that pulled over to value-added people, too.
I think it's a way to erase it by one perception, but probably the point that you make is that if we go on this now, I think we may not do it as well as we do it there.
I think we could get it then ready after having traveled.
I don't know how to do it before, I think, but I did it after I got back from Russia.
That'll be about the first of June.
By the middle of June, we'll need something.
We'll need a kicker on the domestic side.
I will take a major domestic speech at that time.
And at that time, I'll offer this exciting proposal.
It may be toward the end of the Congress.
It may be too late for the Congress to act.
And then you may have some heavy deficits, too, which is one of the things that you propose.
You have a little bit of a Congress action, and you cover it all up with this.
That's another way to put it.
How are they doing?
Right at the end of the year, 60 days, a little less than 60 days from the convention.
And what?
And...
I'm trying to see this in relation to the campaign.
You mentioned a campaign issue.
Do you really want to do tax as a campaign to your economy?
Sure, I didn't have a lot of time for explanation, but all the other election top shelves broke down.
Do you really want to pick up this burden at that point?
Well, of course you do, John.
put in your platform that you want to repeal property taxes on residences throughout the county.
Then when you get asked how you're going to do that, just say, without substitution, I'd like to seriously consider it by any means.
It's just such an important comment through the back door.
But make the first wish to repeal the property tax.
Make that your position.
and the divided added text as a means of repeating.
Supposing we reversed our usual format here and took the presence of our confidence on this almost immediately.
and said there's a lot of work to be done in this, and the process is going on, and the president's very interested in it, and sometime next spring, if we don't see our target as being a state of the union, but we have great hopes for this, bringing down real estate taxes, and we more or less stand out.
The other thing is just have people thinking about it and get them adjusted to it and ready to go.
So that, what I would like to see, rather than having
What I would like to say, I think we're getting closer to the fact, closer to what we've done.
I think what John and I are going to do, we can't just all do that.
And I think what John is going to do is to cover this.
in Haiti, and rather than having it just be written in as much damn columns, you ought to cover it in the, uh, in the, uh, in the, uh, in the, uh, in the, uh, in the, uh, in the, uh, in the, uh, in the, uh, in the, uh, in the, uh, in the, uh, in the, uh, in the, uh, in the, uh, in the, uh, in the, uh,
I think it's well to get it out and get it discussed.
I agree with you.
And also, if it gets discussed, we get pissed off too much.
We turn it.
Sure.
See?
They might have to test the water rather than spring it in June.
And that's fine.
We've got it back on our hands.
What do you think, Jim?
I think it's fine.
It's a trial of a little therapy, see?
I mean, I got close to all the geniuses.
I wonder, at this point, if we
First, we have a hell of a lot of initiatives that are there.
People say we really don't need them.
Second, I think that just looking at the little package you've got where they are, maybe we ought to cut some of that up and make it what it is, but make it a state of the union.
But we don't have to go out every time and go to China.
And you see, I'm not sure that the country at this time, looking at it from a domestic standpoint, John, needs that kind of shock of infinity.
I agree.
The country needs this.
It needs polls.
It needs to be against the status quo.
It needs to be against the status quo.
But there is something to be said for a need for some calm and some certainty.
and not some idea that every time we turn around, here's some bold little program.
You see my point?
We may need it, but the countries that we took an awful lot to on this last year, it's hard for them to turn around.
It's going to be worth it to do this, and no problem at all.
It's a state union.
It can't be a, it ain't literally a state union, but any emphasis on the strong points
what you've already advocated here, make it economic policy, make it that kind of thing, and then just come along in the normal course of events with special messages to the Congress touching on certain subjects.
Yeah.
That you want to advocate in this new session of Congress.
Right.
And without a law, without a federal pact.
Yeah.
Then, when McElroy is ready in February or March, let him come in and make a presentation to the cabinet on his commission's findings.
Right.
And then let the secretary take off from there.
Right.
Respond to that with the value added story.
And then by the time we get to June, and you get back, you're kind of in place.
We've already got about half a dozen charges in the air here.
We've got a value add, we've got a school problem, we've got the real estate tax problem, and we can be grabbing speeches on that, and you can be stirring up a lot of attention tonight.
And then you can bring all together a speech in June.
you get back and say, here's this McElroy report, here's this good work by the territory, and this is the way I'm going to put this all together.
And it will be fought.
And then just let it lie.
You could say this is something that ought to be debated in the country, and...
Well, I'll tell you, the whole repeal of taxes is better than having them repealed.
If they have already had them repealed, they'll at least get something out of the state.
Sure, sure.
And if they think you're the only guy that's going to repeal the taxes on their home, they'd better re-election.
Well, that would have been more frank and more political than the fact that you've already done it.
We could get a hell of a lot of people to do it.
Well, you realize, look, that real estate, a lot of people would do on this.
Oh, yeah.
Lead education people would have to be with us over there, George, over here.
But you can go and speak to those groups.
Oh, my good, I should have it, which is a tremendous deal with them.
Yeah, well, they can also see that.
It speaks material for appearances before the homeowners and real estate types, before the educators, before the governors, before the agent, the municipal, the agent.
You name the group, you've got some here that you've talked to.
The blue-collar people.
I think you're right.
I don't think you should go off.
I guess you're going to substitute for that.
Now, we've been on partner.
for a background for all this kind of stuff.
We have to set a line.
And we can be fairly serious about it.
The work is all done.
The research has been done.
The president knows what he's talking about.
That's about time with that.
Well, now, that would be after the McElroy Commission.
I said it's very hard to do.
Uh, and, uh, we say it's all backed up, we talk about it with us, yet, yet looking at our immediate problem, between now and the first of the year, you're going to get questions about it.
John's got questions.
I think the way to handle that is to say, the package is under consideration, and you'll have recommendations to make in the spring.
Right?
That's our action.
You say the same thing.
And they'll say, what about that?
Well, that's one of the ones to get considered.
A lot of work to get done.
A lot of work.
We have a bunch of work.
That's good advice, John.
I think it's best, George, for you, but I just have an uneasy feeling that John has convinced me, in one sense, when we see what Wilbur did to us on revenue sharing.
Oh, God.
You know, we were real better at revenue sharing than every organization for two and a half good programs that were.
And we're going to get ready to pass around that next week.
All right.
It's coming up.
Oh, yes, sir.
We may get pulled in down here.
I was just up on the hill.
Our brother was here.
We'll get it out of the area.
We'll get it out of the area.
We'll get it out of the area.
We'll get it out of the area.
And, uh, he's already got just a very general democracy.
No, it is a very general democracy.
It's a little combination of special and general.
And he's got the, he's got the public interest groups, the states, the cities, and the counties to drive this through the House.
But they have not committed to stick with it through the Senate.
And so they're going to screw him in the Senate.
I doubt he's just going to screw us in the House.
But he'll go to the executive session, probably, as soon as we get done with the tax code.
You know, I showed you the idea, unless they're having some potential hole, or will return Wesley.
I've no question about that.
He got too much, you know.
And if you say that this, you know, on the surface, didn't have a three-month right, it went down.
But believe me, I know.
But, uh, this has been a line that's been out of the country.
And I understand, I believe, as much as I, you know, talk about the environment, I realize that it's, amongst certain constituents, very important.
I do know the issues that John has as a successful politician.
You don't want to make your best speech to us.
Well, would you say that we still have that effect?
Yeah.
Yeah.