On December 22, 1971, President Richard M. Nixon, Paul W. McCracken, and unknown person(s) met in the Oval Office of the White House from 12:31 pm to 12:43 pm. The Oval Office taping system captured this recording, which is known as Conversation 640-007 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 Do not cite this transcript as authoritative.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.
Well, Mr. President, I'm leaving.
I'm leaving you out of the sun this way.
I see.
Since I'm leaving soon and you're doing a lot of traveling, I simply wanted to come in.
And you'll be leaving then?
End of the month.
Yeah.
And I'll be gone.
And you'll be gone.
That's right.
So I wanted to... Well, it's been a very rewarding association, Paul.
I appreciate your hard work, your employment, and your honesty.
And frankly, as I say, you're leaving in time.
I agree.
Moving along.
I agree.
Oh, there's no question about this.
It seems to me the pieces of this jigsaw puzzle are pretty well in place now.
And the economy is moving up.
The price level is doing pretty well.
By the way, it's a season.
Two times.
Two times.
That's pretty good.
That's very good.
And non-food commodity prices showed no change.
So this is the food field.
So it's partially food.
Oh, services.
Services.
Service area, of course, tends to creep up.
And, of course, the international thing is, in my judgment, a great, just a great accomplishment.
You feel that way?
Oh, yes.
Yes, of course.
That's it.
We really do.
You know, I'll tell you this.
We turned the Office 15 thing.
It was indispensable that it happened.
That's what it really was.
We put the surcharge on.
And then they said, well, we, and by putting it, which was sort of halfway illegal, as I understand it, but by putting it off, it hurt them so much, they said, oh, just get rid of this.
And by getting rid of something that we shouldn't have done in the first place, we got something we needed.
Exactly.
They said, it's like the guy who comes in and says, oh, I've had a ton of hell, and it's all over their heads.
You know, he stops it himself and says, gee, that feels great.
That's absolutely right.
That's a good analogy.
And, you know, frankly, one or two of these countries, and I think Germany is my leading candidate, settle for more of an appreciation of the Deutsche Mark than, in my judgment, they may be able to live with.
which is another way of saying that within a couple of years, the dollar could well turn out to be a very hard currency.
I mean, that's for them to decide.
I think this came out really, well, just beautifully.
And I congratulate you.
Of course, the branching was indispensable, so they had those meetings.
By getting Conley to work on that, they broke the tie for the others.
But Conley did a masterful job.
I was then presiding over that group, and Barber told me, and permitted, he said, without Conley at the end of that, people would have never reached him.
He said he just wheeled, wheeled, and pushed, cajoled, and trapped him.
Oh, I'm sure this is true.
I'm sure he's a master.
Well, you can see this.
I found myself walking by the beauty dealer in Bethesda, so I dropped in to look at Opal prices.
And, frankly...
I don't think they can compete with U.S. producers now.
It's changed that much.
You see, you have, or take the Japanese cars.
You take a car that's over $2,000, it just translates out now at $2,300.
And they either have to take that much on profits or else they take it in prices.
No, I think it'll take time.
That is, it takes one to two years for trade patterns to make their adjustments.
So you can't expect miracles, but it'll happen.
Yes.
And it... Well, I was interested in your conference with Pompidou because I had had...
I had had dinner with his economic advisor in Paris, Mr. Bernard.
And the interesting thing was how, the extent to which he went out of his way to, well, to take a pro-American stance.
This was before the Congress.
This was before the Congress, yes.
And moreover,
Yes.
Well, our relations with the Europeans, despite the strains, were really on track.
Even a better way than they were before, you know, again, we had to told them that they spent just too much money.
So now we've done this.
We have now moved to a... And probably a troop for Japan, too.
Yeah.
It'll be a hard negotiation.
I'm sure you'll think about it.
It'll be good for that.
Come in.
We'll all reassure the conversation.
They're hard work.
Hour after hour after hour.
I've heard they're tough negotiators.
Yeah.
Very tough.
Japanese.
The Japanese.
The French are tough, too.
Oh, yes.
Well, they are.
The Japanese are irresponsible, legally tough.
But when they make a deal, they'll keep it.
They keep the deal, exactly.
We always remember that.
We always said on the Japanese side, we'll make a deal, but once it's done, two of a kind.
I did suggest that when I was in Tokyo, I think I mentioned this to you, that we ought to have a little more continuing relationships
a consultative relationship on economic policy with the economic planning agency there.
And that was snapped up, and I think we ought to implement that in a very low-key way.
It might be helpful.
What would you do there?
I would suggest that... Well, I would suggest that the...
I would suggest, I think, that at the outset perhaps Ezra Solomon meet with someone from the Economic Planning Agency, Mr. Kimura or whomever he would designate, to work out procedures by which perhaps every quarter or something like that there could be a meeting there or here or somewhere in between.
just to review developments.
I think half of this is probably kind of public relations.
Yeah.
Well, we might be able to get some progress on that.
Yes, yes.
They have this .
Yes.
Well, I've participated on it.
That's something different.
Too high level.
Too high level.
I mean, it has too much visibility.
We had a meeting here.
We also had a private breakfast meeting with Conley, and Arthur, and George, and I, and Pookuta, and Zuta, and Kanaka of the Ministry of the International Trade and Industry.
We did more in that two hours than we did in the two days of consultation.
Rather forthcoming.
In fact, it was there that Fukuda indicated that they might go to close to 15%.
But he never intimated that in the official meetings.
Well, you will go back to...
Do you have a house there?
We kept our house.
What?
We kept our house.
You rented it out, did you?
We rented it out to a graduate student for a nominal fee so that he would keep the loan.
Oh, that's nice.
What would you do?
Would you lecture?
Oh, yes.
Well, I'm going to have a doctoral seminar and a lecture course.
What level of students would you do?
All graduate students would be in the graduate school of business.
Yes.
But I enjoyed it.
You have a tremendous amount of heart set together.
You know, I can recall the lectures I used to hear, and what really always caught my interest were the examples from real life.
Everybody knows that.
You know, you've got so many examples from real life.
You were there.
You saw the right.
The temptation will be to become too anecdotal.
I know, but those anecdotes, people remember, that's the whole test for these anecdotes.
Well, I guess you're right.
It's the greatest teaching in the world.
That's what a parable is, I guess.
A parable.
That's right.
Prodigal son.
That's how people learn.
Well, uh,
I think we're going to have a party for the 21st, Captain.
We want you to comment on any of those that are out.
I'll let you know.
Money versus character.
How about the crickets?
Money, but for you, and a silver contract for your wife.
Well, the other, this is quite nice.
Well, thank you.
That's because you're a money man.
I'm sure that that money is worth it.
Well, and it's that money.
Whenever you have any question, tell him that you base it on your talk and throw big names around.
He's impressed with big names.
He says he's on the track.
He told me that today.
So I can't push him too hard.
But Paul, you know Arthur, he just has got to constantly be told that other people are thinking of him.
Because that could kill us this next year, could it not?
Well, if it doesn't help us.
That's right.
I mean, that's right.
That's right.
But I do think, I would say this, that I feel more optimistic about 72.
About the economy?
Yeah, yeah.
Well, then, I felt that sometimes I didn't think it was going to come around.
On employment?
No, of course.
Maybe a couple of points.
That's okay, actually, just a little.
Maybe half a point.
Well, that'd be great.
It could happen.
All right.
Thank you very much.
Thank you very much.