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I have a proposal for this revenue-sharing ceremony.

I want to get your personal desires before we go ahead with it.

We assume it will be short, in the White House, indoors, and large.

Standing crowd or sitting crowd, you think?

We can get more in.

If it's standing.

Well, I have to shake hands with all of them.

That's all right.

We can have it stand, yes.

What about the vice president?

You ought to introduce him as one of the fighters for this.

You'll single out maybe four or five people for a special mention.

And he'd be one of them.

Yeah, which ones?

The Congress, which ones?

Well, you pick out a citizen, everybody in this room, but just for example, let me mention three or four people.

You've got to mention Rockefeller.

You've got to mention Rockefeller as the governor.

You won't have any trouble with that.

You mentioned a couple of citizens who've taken a leading part in this.

Why don't you give me a list?

Sure.

I'll mention the vice president and the role of the vice president.

Right.

Now, what I would do, what I would like to do is have them all standing there.

And I should walk in, probably with the vice president.

Yeah, the vice president.

We walk in.

And I'll stand and speak.

And they have all cheers.

Some of these people will be coming from long distances, and I thought I'd check and see if we could afford giving a pen to everybody who attends as they go out.

There are a couple of innovations here, and I'm going to try to see which thing.

For one thing, it is historical.

It sits better for somebody else to say that than for you to say it.

What do you think about having a historian, a friendly historian?

They've given me the name of a fellow in Columbia named Moore.

Richard B. Morris, American historian, who's prepared to say in a very few words how historic this is for television.

Well, I'm not going to do that.

All right.

I mean, that would be our alternative.

We could have some congressman or somebody say some nice things about you.

But here would be a way of getting a fellow to do this.

And without your having to introduce him.

Yes.

Yeah.

I have a feeling that putting on a story would not be good for the regular press, but I don't think it would make a total difference.

All right, that's it.

That's it.

I think Ross Rockwell was a good idea.

And he has been a hell of a puncher for it, you know.

Right.

Because he was the chairman of Congress at one point.

Yep, yep.

Again.

The governor's been fighting for this.

It's the first administration to try to arm the media like that.

Prepare the remarks for him and let him speak for it.

Yep.

Why don't you have me do that?

Great point.

Now, for bipartisan touch, you know, Joe Peckman and Walter Heller are both McGovern economists now.

But there isn't any question about the fact that they were the forerunners.

They, I think, showed a revenue-sharing idea to Johnson.

Not McGovern economists.

I'd have a Democrat for us, but I wouldn't have any McGovern economists there.

It's not that bipartisan.

He wasn't there for the vote anyway.

Okay?

And they suggest that...

I don't mind them being invited, but I don't want them to participate in the sermon.

Ah, okay, to invite them.

Yeah.

Okay.

Did they support him during his period of time?

They did.

And he's not invited, of course.

Oh, no question.

No question.

But if you...

But for bipartisan, I just don't know.

I think...

I think just...

I don't see any necessity for anybody to talk about it.

All right.

Or if you know it.

Let's see, I will mention bipartisanship myself.

I'll mention Wilbur Mills.

That'll be the bipartisan feeling.

And Rockefeller, I can say that, and I will have him speak as representing the states and cities, a man who's been very active in this cause for many, many years, Governor Rockefeller.

He's got to be the senior governor.

He is.

Oh, he's the senior governor.

Yeah.

And I sit down and sign.

Wouldn't that be a job?

I'll mention that.

I'll mention that in Rockport and cover the history.

In fact, how about letting him just start the ceremony?

You walk in, and you sit down at the table up on the dais.

He goes to the rostrum.

He says, Mr. President, Mr. Vice President.

He starts in.

That wouldn't work, because I have to be the host of the thing.

And I think it would be better

I can just say that it's been weird.

And it's awkward to get him on.

My view is that probably the best thing

And then I've got a real list here of apostles.

And they're mostly...

a while back with everybody in the administration who had worked on revenue sharing.

And for some reason, the picture didn't ever come out.

It was a defective film.

So they were asking.

And a lot of these people, like Murray Wiedenbaum, for instance, are coming in for this, who are now no longer with the government.

They'd like to save the photograph a few minutes before the ceremony with those people who were in the administration, who worked on it.

So we'll run you by a set.

Thank you.

Other than that...

I talked to John Colley yesterday about taxation.

And his thinking runs very much along the line of yours and what you were expressing the other day.

He is not keen on raising the minimum tax.

He says he thinks it would be a mistake to get into a social rich posture at this time.

It's too much .

And everybody else.

Oh, Ron would very much like to sit in the tax meeting like he did the other day.

The other thing that he was very interested in was this idea that is so developing of using the fiscal dividend and the taxes.

I am excited, and I excited myself, that no way you could put that raising the minimum tax.

No way there's no savings for the raising tax.

Let's just not buy into that trouble.

I think we have to get out of this with this easy, most painless thing, so I'm sure that we're doing something.

I've written a hell of a tough letter to the Post, which I think will run in the next day or so, blasting Rowan and taking our position on taxes and moving it.

Well, there's the idea that we are going to see the action.

There's a lot.

And I know there's

We'll continue.

He went out and really laid it out here.

But it's right.

I'll put you right there next to the hole.

What do you mean?

I don't think so.

Well, since we've had the last time, we've had a chance to think about these connections a little bit.

I want to start with you.

Ice pop.

Manila's?

I don't know.

And Coca-Cola.

Manila's back on iced tea with a pineapple.

He said.

I don't know.

Well, that'd be ice.

Until we see you ask questions to the sun, we've tried to say what, if you had to do it, what would you give up?

That's right.

Federal revenues rise more rapidly

to achieve the objectives that you're after.

And the risk of driving everybody up to the wall and having some numbers.

So I just take one.

And I'll tell you what .

Just one for everybody?

Yes, that's all yours.

Well, let's be sure that everybody .

Let's just turn to page two, because I think we probably want to get higher than the $10,000 to $20,000 range of income.

This table has to do with the property tax.

Suppose that you said

you change those numbers.

And if you want to change the $500 maximum to a greater amount or a lesser amount, you change the numbers.

But this would give you, this looks like a reasonable thing and gives you an idea of the orders of magnitude.

Now, if you were to put that in,

You say 50% credit, George.

How many percent of the 500?

Well, one could propose something and say, I'm going to starve the older people.

And the first people who are going to get this are those 65 and over.

And you could, in other words, have a drug.

Line B shows you the orders of magnitude if you said that it's available 100% for people over 65.

And it's available in the sense of a 50% credit for others so that if a person has

For those over 65.

The income is between $15,000 and $25,000 when tax saving diminishes from $500 to $0 and becomes $0.

For those over 65, if they have a property tax of $500, they have a protection of $500.

If you're below 65, you have an income gradient.

But you would phase out between $15,000 and $29,000.

For those under 65.

For those over 65?

Under 65.

Are you on line A?

I'm on line A. I'm on table 65.

under B applies to those under 65.

But you can apply the same thing above if you want.

I don't think this is a matter.

It doesn't make a lot of difference over 65.

Do we have any idea how this relates to people over 65, how much property tax they typically pay in these brackets?

We have that.

We don't have that today.

If they're over 65, that's a lot of dough, I mean.

That's a lot of credit.

Say something about the why.

You could do it that way.

And these tables are figured out.

the credit approach for the deduction.

And if you wanted to do some things by way of simplification of the tax system, one idea is to take certain

And then change your standard deduction in some appropriate fashion.

And eliminate all the other stuff as deductions.

And that would be a great simplification of taxes.

And you could do it in a way, you could figure it out so that you broke even.

You could figure it out so

above the $500 in place, is that obviously an open question.

In effect, what the deduction approach does is the wealthy person

What you do is create an invitation to drink the federal treasury, because all the locality has to do is raise its property tax.

The credit system, the federal government

property tax, of course, doesn't have this drawback to it.

It has other drawbacks to it.

It's more complicated, but it is a way of getting around that.

The 0.2 under E shows you what happens if you add renters.

And the assumption for the amount of rent is that 25% of your rent is property tax.

very conceptually.

There's no way to argue that you shouldn't be as forthcoming as people who rent, people who owe, because they're paying it directly.

There's a rather tricky argument

there would be some amount of imputed property tax that you would be refunding to them, and it would just be an administrative nightmare to try to figure that out.

If we were to follow this approach and to do something with the standard deduction, my preference would be to try to handle the renter problem within the framework of the standard deduction, which would probably be helping them as well with the deduction.

They do take, but it has to be.

with a table like this.

Because I know that if we're going to do this, we should leave it between the landlords and the tenants.

Forgive us.

Well, there's a biting sensitivity to this business that passed through to the ringer, though.

Every time you get into this subject, this is what people want to talk about, is how do you get to the town?

Well, so that's a real problem.

And you can see that you can add to the problem.

And so this shows you, anyway,

He's around, yeah.

Now, if you turn to page three, you see the other side of it.

If you return to your 1969 proposals and apply that to individuals,

then you'd have line 2B.

That would be the amount of revenue that would generate.

Now, I would have to say, and I think there's a lot of good political sense that something's going to be done to doing that, because you can say you're returning to your original proposal, which Congress didn't enact, and this is the way to get equity and so forth.

It is extremely complicated, and in addition

Sure, the Congress reacted to the convocation of the system.

I can't.

If you asked me to explain it to you in the two minutes, I couldn't.

I wouldn't be able to do it.

I sat down with the head of our tax group this morning.

I said, all right.

It explains to me that he couldn't do it.

It's the minimum tax.

The minimum tax.

Go back and think about it.

Come back in an hour.

I just say, well, because he's a taxpayer, George.

There is that anyway, and you could do that.

Your instructions, you know, cop out, and that's the ones that they send out to the taxpayers.

Well, they're trying to do what they have.

I think there's a terrific interplay between the two elements.

You could, however, you want to just take the system as it exists and just say, all right, I'm going to double the rate.

That is in line with the rate structure.

with the internal structure of what was done.

And you can see on line one, A and B, and then the total, what you would get out of that.

Now, having said that, the purpose of the minimum tax

one you could propose something that would yield income that was practically the equivalent of the old age property tax deduction so you could be proposing a wash there in more or less in terms of the budget and the stance as far as the budget is concerned now let's shift down to the

Federal revenue grows each year with the tax of personal income tax, the TAG of the federal government, grows each year with the rate sale constant.

And there are five reasons that you can exhaust that growth in terms of five reasons.

One is that the labor force and the population and everything grows, so it's bigger in that sense.

Another is

that you have inflation.

So people get higher wages, and they pay more tax.

And there are two parts to that.

Part of that is just proportional.

In other words, if I was paying a 20% tax before inflation, my wages go up, and 20% of that increase is paid in.

And it's just proportional.

It's up and down together.

But actually, the federal revenue goes up more than proportionately, because

rising income moves people from one bracket to the next bracket.

And so it raises the effective tax rate.

And so when you think of those things as two parts, there's the proportional part of inflation, tax increase, and there's the progressivity part.

Then the fourth reason is the rise of real per capita income.

the way we have been talking was, and this was coming back to the little treatment idea that we talked about, periodically,

By giving you this five-way split, what I'm suggesting is that there's a possibility of taking the inflation progressivity that way, but the real per capita progressivity

any tax increase, you're proposing this property tax program.

And where are you going to get the money?

Where are you going to get the money out of this progressivity effect?

That you can identify and calculate.

all this money was in there, and it's all used up, and more than used up, and nobody quite sees where they're gonna get the money, so people would say, well, all that means is that you're gonna have to save it somewhere else in the budget, or else you're gonna have to raise the taxes somewhere else, and that's true.

And I suppose, at least I would judge, I understand what people were gonna say.

Congress has historically brought this right back down to town.

You can see how those numbers have built up.

Without a doubt, you could have dealt with it in the first place.

No, certainly not.

Line one is just the progressivity dividend, what we call it.

It's a different story, right?

It's more stubborn than good.

Until tomorrow, I don't have a third problem.

But that's what I did.

Or you look up above at your presumption rate, and you can make those deductions.

In other words, if you started at 73, so we have zero, that changes.

I think the point that you can get from this, if I can just try to close the circle here, is that there is a way to describe certain kinds of revenue and to plot out a program on property tax changes that can be made to fit together.

years from now, so there has to be a program and a plan.

Yeah, but if you're talking about the swing, 74 is 2, 3, 3, 1.

Where do you get the gravity of 76?

You're talking about 7, 9, 12.

But it is, I think it is a presentable argument

the dilemma of how you can say that we're not going to increase taxes and we are going to do something about property taxes.

We start small.

We help the older people.

There is a tax simplification program that we can describe to you that could be worked out.

This is all on the credit approach.

Obviously, the same dollars could be generated

a lot of attractions to the grant approach because whereas this approach leaves the property tax intact the property you don't get rid of the property tax if you do anything you tend to stimulate the use of it because the but you do take the burden of it away from the individuals you're worried about

One, we're going to

approaches to say, well, first, recognize the amount of the gain that's illusory.

That's just due to inflation.

by a 48% rate.

if you were to buy this kind of thing.

We have the short form ready to announce in early October.

There are lots of other ideas beginning to kick up their heads.

Special tax return for people over 65.

They have special things about their income

Thank you.

Well, I think since we met the last time, I'm thinking about the basic political problem.

And I don't think there's any way that we can now present any, even though we did not increase the overall take.

When you talk about tax increases,

I don't believe it.

Now, when you get into these things like the deductions and the loopholes and all the rest, we know that most of those arguments are malicious and mean or illusory.

They're there for a purpose.

Now, if it is true here, then probably the time is right.

But at this time, for the amount of money you're going to get out of it, I don't think it's playing any good.

Well, then, for the amount of money you're going to get out of it, I'm going to say, well, we're doing this because we're going to get the interest.

But I think that the way that it would play, tax increase.

If it plays tax increase, there's a hell of a lot of people

scared that are not going to be affected.

That's what I'm concerned about.

I think there needs to be

Thank you, Mr. President.

I'm sure that there are.

I'm sure there are, because that's what the tax lawyers are all sitting there thinking about.

And that's what they're doing all the time.

The lawyers are like what, George?

What are you talking about?

Well, the area that people talk about are the farm areas, cattle areas, deep lots, and that kind of thing.

The housing development.

Not necessarily the low-income housing type thing, but just any kind of housing.

What else is a favorite?

Well, let's take a look.

If we're back here, Jeff, start out with basic groups.

Why are they there?

Let's look at it.

people invest in.

They don't go anywhere near the farm.

And I think in that area, as I understand it anyway, and I don't claim to be an expert on this, but I understand a lot of the

Yes, the General Caffey game.

I take it from a standpoint of, I think, I'll put it this way, from a political standpoint, what we're going to do.

And also there's some hellish big contributors on both sides.

And also, there's some hellish big contributors on both sides here, too.

That's a lot of money.

But I just don't see how we can do it, that's my thought.

I don't believe that we should bite the equity bullet if the cost is going to be a story of the effect we

change in the level of tax action, change in the structure of tax action.

The argument would be the structural level of tax action.

I think that's really what I have felt.

I don't know how long you could get away with it.

Frank, you ought to change the structure.

There ought to be a simpler way to get at this.

It's an animal income tax.

That's why you felt, three or two years ago, the value of something going to have a system.

We know that now.

and we're moving in a certain direction.

We haven't said we're going to do it.

That's why the...

and some expenditure reduction.

You say, well, that's not going to be better than that.

Not there again.

Not this year.

Therefore, you either have to go to some increasing tax elsewhere at the average level

That doesn't do it this way, Mr. President.

You can take your table on the top of the page straight, just to identify.

Without the increase.

Without the tax increase.

You can just say you're going to hit the elderly in 1974.

You've got that.

I think there is this argument to be made, that periodically, like everybody, Congress has, in effect, taken the progress of the dividend.

And it's for that reason that the

64, 69, 70 on tax changes.

So in that sense, you could say that

I'd say we start the next fiscal year with property tax relief.

This will cost a million dollars.

We'll expand that in later years.

Partly through expenditure cuts that we expect to make, and partly through tax reforms that we are now working on, and that in due course will be announced to the Congress.

The tax reforms will be a word.

The tax reforms are supposed to be a video interpretive of the tax increases.

Well, with the...

to make this decision mr president came to the board saying i think you already have

But not tax increase.

Say tax reform.

No, we're increasing the level of tax reform, meaning the structure.

I don't know.

I'm not specific.

I guess you can't touch it indefinitely.

I heard in your five-year projections, you protect revenues.

Do you include this so-called productivity factor in your particular revenues?

You know, let me tell you a little history.

In October 1968, the Enoch Powell, this maverick of the conservative party in Britain, gave an address at a conservative rally.

And it was one of the finest things I've ever heard.

And there he explained a plan under which taxes in Britain would be reduced by 50%.

And he proceeded to explain in very reasonable terms

pretty convincing fashion that Britain would be no worse off and perhaps really better off.

I don't think any of us have to ask the question.

When we do it, at least the problem is not.

Why not?

Because we lack the will.

So, you know, you've got all these programs that march out into the future.

If the will were there, here we come.

When I testified the last time,

Oh!

Oh, you want to get it?

You want to get it?

Let me say a word on this just so we can get a little of it.

I have no illusions about how dead difficult it is to cut because I know how much is controllable and how much is uncontrollable.

I also know that in the fence area,

It would be unsatisfying.

Looking at other areas, we have been here for three years, but we haven't done really a very good job at coming back from the region.

We haven't done very well.

One of the reasons we haven't done very well is that when we first came here, we had 43%

We didn't get out of this huge colossus of education, which is just dogging us up, eating us up alive.

But he's got an anti-hunger problem we don't have.

Well, the anti-hunger thing, we always brag about tripling the number of food stamps, and I think that's one of the worst things we've done.

We've gone up and down the line.

I'm just referring.

I mean, I know that.

say, well, but you didn't do that thing now.

What can you do then?

What can you do now?

Well, at the present time, one thing that we are being, I trust, very careful of is making any promises about what we're going to do in terms of big spending programs in the future.

We've got it all there in place.

Extremely hard to find.

But I do know this, that in this election, we may not win either House or Congress.

We might win one.

I think you should have heard from me.

never gotten in the first place.

OEO, Community Action, much of the area we know, a lot of the stuff in transportation, a lot of this has simply got to come down.

Now, having said all this, I only say this to point out that if that should be totally honest and giving advice, that, well, look, you can't go out there and say, well, we're going to get some money out of it.

that we are going to have to be able to play a stronger hand in terms of fiscal responsibility than we have in the last four.

Because in the last four, we couldn't dare.

We didn't dare to cut the community action.

We didn't dare fail to pour in money into this and that and the other problem, because we're here.

We have arrived in the city.

Now we can, I trust, dare to do something

but i think let's stand in front of the executive we'll have a chance to move in a more conservative way so maybe you can find that

I think maybe you can be negative about that, but I'm still concerned about making the commitment before you see more of it.

Yeah, that's awesome.

I agree.

I'm concerned about our $1 billion.

That's right.

Yeah, when you project it down the line, I agree.

I think that actually what we've got, what we have to do, what we have to do is to think in terms of a very limited beginning.

We're going to start with this, and then we're going to have to do our best to cut back expenses and so forth to get more money so that we can have this.

But that's going to be our first priority, sort of along those lines.

How would you handle it, John?

Well, I think that's exactly right.

I don't know.

It's a little over 65.

I mean, I don't know about that much money over the next five years.

So if I pay you $400 million, we'll always put it in.

1978, if you get 100% credit, then those over 65 never talk about being born in the United States.

I think the question there is, when the president can remind himself to the over 65 age group, thinking beyond 1975.

He could say that.

No.

Yeah.

I think he has to.

Yes.

You have to hold the hope out that we're going to go to others.

Because let's also, let's also.

We have to, we cannot lock ourselves in the position either where we cannot attack you for it.

Like we've got to attack.

There is a difference.

Well, can I suggest that we try to...

I wouldn't like to move off the progress of anything.

That's a tricky thing.

Let me put it this way.

We have some sort of restraint.

just say, well, we're going to try to save money and this and that.

You may not.

But if you say, well, this is committed, that means you do the trick.

Well, that's very funny.

A lot of people also have to come up

Oh, yeah.

Good.

Great.

Check out welfare today.

Yes.

He said welfare is dead in this session, and he doesn't want to impose on the House and the next Congress that it was too bitter, too tough a fight.

He doesn't see it on the agenda.

You tell me if you want to tell me.

What I was going to say, to indicate the kind of thinking we've got to start doing in our own minds here, Nelson was in, he's got, as you would imagine, he would have some very far-reaching ideas about what we ought to do domestically in this country in four years and so forth and so on.

Much of it did not deal with problems in the program.

Much of it had to do with restructuring.

The really big question that we're going to have to direct our attention to is what we want to do with the mandate we hold together.

Whether we just want to go along

molded it to our way, not what I'm not completely, but we have begun to.

In the domestic field, you would have to say we really have.

Now, that's not our fault.

It isn't our fault.

When I say it's not our fault, we didn't have the votes.

The Congress wouldn't go along.

We finally got a revenue check.

I assume that's a good idea.

I don't know.

I don't even want to let that go, George.

I'm giving all that money away.

Now, you're not so glad, aren't you?

should be toward a great new, for the first, government activity, new government programs, whether it should be a shift away from some of those, a very hard re-examination.

CBS put on a series of programs.

They put these damn programs on.

And they convinced the Congress and a bunch of people that a lot of people were starving.

And a lot of those people, the politicians were big.

The politicians and journalists were right under it.

And then they came in.

And then, of course, I did a stupid thing.

They said, appoint a commission.

Every time you appoint a commission, it's stupid.

So we appointed a commission.

They had a commission.

They had a conference.

No, they had a conference.

It was a bill of mayor.

They all came.

Oh, nice job.

Wonderful.

He wants to give me a lot of money.

So as a result, we are spending about $90 million a year or something.

I don't know what the figure is.

It's an awful lot of money.

On food stamps, people are buying booze and women or whatever the hell they do with food stamps.

Instead of giving them wheat or whatever it was.

But nevertheless, my point is that you can take food stamps and say, up to a certain point, it may be a good idea if you're given a commodity.

But, you know, just to dash those things off there, you know, the way we are in LA, at least we're all doing the wrong things because we couldn't get our leadership here.

But now we're going to have the opportunity to do it.

living by $50,000 or $5,000 a year or something like that.

I'm sure that all, basically, my liberal friends will be in here.

And I think we've got to go a little bit more seriously to talk to them.

Right?

Must have been doing something, right?

I was going to say, Mr. President, if you're not going to out-promise

You take the health program.

That's the major part of its deficit.

Sixty million dollars.

We're just not going to have anything like that.

I just don't believe it.

That's all there is to it.

And there's a, and I think that we've got, our own health program, unfortunately, has cost a very modest amount.

But I have some doubts, unfortunately.

Well, anyway, we digress.

Coming back to this, could I ask that we go back to the drawing?

Second, let's talk about a modest buy-in for the elderly, like you have on your chart there, and looking toward

and what time frame.

It's phony to the informed and to the economist and to the wage and means community.

It's not phony to the American taxpayer.

The thing about it is this.

If you could make, basically, Herb, the way I like to do it is to make it in terms of a pledge.

What you're saying is, look, be honest.

I tend to like the approach to say, look, we're going to have to have a billion dollars next year in 1974 for the first

You've got to cut it.

You've got to cut your other spending.

You can't pay your charge.

Because you haven't got that money to spend.

So you can't take that to protect your revenue.

I don't think we want to accept a personal income tax system that projects ever-increasing, ever-increasing taxation on American people.

That's what the...

I think that the law school professor I had in taxation

They have a strong view of it as a personal traditional tax.

And at that period of the 30s, they thought it was a mistake to use the income tax system for the purpose of achieving social change.

You want to achieve social change, achieve it, but don't use the tax system for it.

But now we've crossed that bridge.

That's why the system is so screwed up, right?

Now, I personally would favor, I would personally prefer grants to all these.

I decided that I'd go through this on a means.

Maybe I'll change it.

Well, I'd say, well, if you won't tax me tomorrow, I'm ready to go back.

would change the tone of the society in a fundamental way.

That is a strategic shift that has to be going on.

I think we'll hear from you.

Well, let's proceed a little more on this.

But again, the greatest of it is just you're working up working papers and so forth and so on.

No decisions have been made.

So we're not going to go on this thing any other way.

Yes.

Well, I'm in Paraguay.

I'm trying to read.

We'd like to have the 65, the property tax.

65, that's practically done in terms of what you would do.

That's all I need.

I just need to have something to make of it, to have a gesture of good faith on the property tax.

I don't think the simplification will probably .

Your form is an actuality.

We will have the short form this year.

And we can fit the announcement of that any time you want.

It has been published and commented on.

If you could go, if you could get something ready, I mean, I shouldn't be just totally over-courting people, but if you could have ideas, perhaps these are left by an idea of a special form for older people, bigger brand, that could have one element.

They can't afford accounts and all the rest.

Yeah, I agree.

That's right.

No, that's right.

That's right.

And put on your glasses when you do it.

The other thing is that on this other one, though, I want to get something that I can do that will show a gesture of good faith.

Do you read, John?

Yes, I do.

Provided you see it.

It's not raised.

It's raised in taxes.

Here's our purchase.

We can get that ready for you, and I'll get that over here.

How does that sound to you, John?

I think you ought to also spell out your long-range goal.

Oh, yeah, I agree.

Give some indication of how you intend to get to it.

No, I didn't intend to stop.

I would say you should include the $50 and then take the program.

So then say, here's how we've been working out here.

That's right.

I'm not impressed, frankly, by Herb's sophisticated objection.

I don't think the average

pocket was getting picked, and that we're going to feed it back to him.

What I want him to do, what I want him to do, I want him to line one and see what he can do with it.

See that?

Line one on page two.

Page three.

Get that line one.

There it is.

See what you can do with it.

That's all right.

There it is.

I just...

I think Businessweek and the Journal of CPAs and the American Economists Association may all not agree.

But let's say the folks, I would think.

I think it's the other way around.

That's a chance point.

And that's part of what I said.

I said, it's the time frame in which you say it.

And I just had two weeks before the election, or three weeks before the election, the time, the opinion record, all that time to make an opinion.

And you hit me.

That's all I said.

I don't think we have so sophisticated a progressivity and all that sort of thing.

But if you could just the fact that you're saying and looking ahead, we are in effect putting a restraint on our, we're in effect saying we're not going to spend these revenues.

They are going back to the taxpayers.

That I think makes a little sense.

May I also suggest

talking about something that's going back to the taxpayer as opposed to a major tax .

That's a very good suggestion, that you don't do this in the context of saying, here's a part of my tax reform or program.

Well, that you do it in a speech to the old folks.

You say, here's what I'm going to propose to the Congress.

You do it as a, you put it in the context of doing something for old people, not that this is a part

portion of which is going to be allocated

That constituency of ours is a hell of a lot of that 15 now, right?

The difference in cost.

Look at these people.

Look at these machines.

give this 100% to a 65-year-old.

It will average out the average factor over 65 years of age and get this benefit, whether it's an owner or a runner, or the spot.

He's joining us, he's joining out this way for the 65 group, and he's going to do something that's going to expand for others later on.

In the future years, I don't understand.

I know you say that this year just won't talk about those 65, but I don't know.

It's all going back to the first year.

But then I understood what the President wanted to say.

A hundred times.

Both of them would go forward some days.

So in particular, these two chiropractors.

How much do you want to use?

How do you want to go on?

But as far as working patients, is this a reasonable way?

I think 65 is high if we can afford to come down on age.

It's a natural for the story.

You've got people going in at 62 now, social security.

I think we'll have to look at the numbers and see what the costs are for different agencies.

Everybody probably thinks, oh, retirement's due at 65.

I think so.

Maybe that's business people's job.

Business professional.

I had an awful lot of work with people that retired at 60.

And then maybe they retired at 40.

I don't know.

You can think of it.

They go in and eat people.

You can talk about assistance.

It gets a little complicated.

Why don't we talk to our partner clients and people of that kind and find out how, who they are, or what people think about this subject.

Let me try that.

I don't, you know, I'm supposed to see how many people are involved.

That would be very interesting, right?

How many people are involved?

Well, that can be a little deceptive.

I mean, I'm not 65 years.

That's what they both weighed.

What I think, in another way of saying it, is that we should do the minimum.

We should get the credit, because Congress is going to raise you.

Another thing about taking this small bite is that it seemed to me the credit approach is the only way you could really focus on people 65.

It's a beautiful device, doing that.

Whether the credit approach or the grant approach is ultimately the best one for the large job, I think, is an open question.

But this doesn't commit you to one.

At the same time, it's clear to you now that the most egregious problem can be treated expeditiously by the Congress when they come in January, and that's this way.

In the meantime, the ACR go ahead with their study of the Serrano problem and the interrelationship of various levels of taxation and all that kind of thing.

And in the new Congress, after the deliberate study has been done,

here's an identifiable problem and an identifiable solution leading to this general result.

This fits in with John's suggestion about the kind of lawyers.

Absolutely.

Because it's very clear from McElroy, ACIR, government studies,

It's nice to give a talk.

You know what you did at the convention the night before?

You talked into those young people.

You'd better give a talk like that to the young people.

Have you planned one?

To the old people.

We're talking now about the old people.

I'm saying something you'd want to give another kind of talk to the young people.

The Republicans talked to the old.

That's right.

Go ahead.

Go ahead, sir.

If you say it, you knock the cops right out of the front of the ACI.

I'm not saying, I'm not asking, what would you say?

I have a question.

Herb said, can we say that?

Oh, I'm sorry.

I think we're talking about two different things.

Herb said, can we say that?

I said, in the public, did he respond?

Yes, I don't think he'll say it in the public.

I think he'll say it within the

We have a lot of people working hard on the question of taxes.

And I'm trying to get more and more focused.

And if we stop spending time on value-added, we can spend time on other things.

Well, I don't think you should say that publicly, of course, because you've never said publicly other than you've considered it an awful lot of times.

Why make it more appropriate?

I'm getting confused.

The position now is

no increase in taxes.

Therefore, what implication?

The logic of it means there's no new taxes coming along.

But I wouldn't say anything about value added as such, but if the question comes along, I don't see any of this case hanging.

Could I suggest a way of getting at this to the same result would be to have the chairman of the ACIR in and take a progress report from

and let him go out and say something.

Well, why do you want to say that?

Because that's the story of my life.

I don't want to see the president damned.

I think we have a tax of perpetuity.

No, that's not what I mean to say at all.

Well, you don't want to have a secret tax plan.

That's the first part.

Well, but you've got a secret tax plan.

I didn't accuse you.

You still have a secret tax plan.

You can't get away from a secret tax plan.

They'll say you have one, but you do not.

I don't see any advantage.

What do you think about that?

We're not going to get some of this.

That's what we have right here.

You get some of this, John Kennedy, all of this stuff, where he's going around saying, the president's got a national sales tax on his team.

Just wait until after the election.

He's going to hit you with it.

All right.

Okay.

That is said and denied.

That's all.

And just say, they raised their own straw man, so they can knock him down.

If you don't want to buy that tax, you've got to come up and say you've got another tax.

That's their secret plan.

The United States said time and again that there will be no increase in taxes as far as the president is concerned.

I just, I don't know if this is doing any great harm, except you made a point for a year of just saying, it's one of many different plans we're talking about.

So now I want to single it out.

Make a big reduction.

I said, what are we talking about?

The CP agenda of the ACIR will come anyway.

I do it just normal course of things.

Otherwise, we hang ourselves because we've been saving for a year.

But, you know, it's just one of many things.

Sure, we thought about it.

Sure, we studied all kind of taxes.

But I don't think we can get out and say now we're through with that.

That was it.

Now, on the question of this equity subject to the tax preferences and all that stuff, there is this approach of a massive change in those and reducing the rate of taxation.

That gets a lot of discussion.

And really, the alternative approach

where they are to serve whatever purposes they serve.

And John was bringing out that you try to cap the whole thing off in terms of tax avoidance with the minimum tax.

And so we're kind of riding both these horses in our work.

And I had earlier the feeling that you would move us in the direction of working hard on the minimum tax, trying to make it simpler and figuring out things.

Yeah, well, I don't want to.

I just want to say we will do that.

You have said in the press conference that you were going to have a tax reform before the end of the year.

So that's the deadline that I'm trying to work out the material that you look at.

But you've got to think of what will be happening in the Congress.

You will have tax reform discussions in the Congress.

I don't know.

You've got to be prepared.

whether or not the president would supply them or against them.

This or that reform, we've got to work on it.

We should simply have to work on every tax bracket because the mills are committed to over-increasing the tax bracket.

We've got to have a position on every single one for now.

I'd be willing to look at it until later on and see what other adjustments and reforms and so forth.

Does the notion of

Well, there's a whole thing that's a defensive action.

I don't see all that.

If it becomes such an issue, I don't think not in the campaign.

But I'm thinking as far as the Congress is concerned, what do you think, John, is there going to be that much of a problem?

My own feeling is that

that I would have that prepared as a defensive maneuver in case they'd start to screw around with my own group.

Because actually, I'm not going to advocate any change to capital gains in this campaign.

He has.

I have.

We'll just fight it out on the ground.

Well, the best answer to that is, if I'm going to suggest he didn't do it, I don't know what you're going to say.

I'm not willing to change the tax rate of a man out here who did it by himself.

by another.

I just think he ought to have had the advantage of capital gain on that home where he worked.

Because of the Spanish requirements, he moved.

They had to have all the people who accumulated securities with their own wage.

Now, I just think on that basis as a political employee, just saying we're studying it though, we're going to work on this, you know.

I just drop it out of your scope.

However, there is an impression or an expectation that the president will have.

Well, who created the impression?

In the opposition.

Yeah, well, we had one earlier this year.

We had been talking about attacks.

Right.

It's a bad, bad attack that we got from the prime minister.

Well, we didn't have any .

It's been voted out.

It was the one, two times.

for the rest of them.

Don't you handle that sufficiently by saying the president has said it time and again that he's opposed to any increase in the level of power?

But you see the value of that would not be the level of power.

It would be the value of structure of power.

The other thing is that you give the press, you give the press not an increase in this, not an increase in

top of anybody's list of speculation that the ACIR were having real troubles figuring out how such a tax could be inaugurated without insuring local sales taxes, without seriously impairing the ability of local government to raise revenues.

So it just, in the nature of things, people shouldn't get out too far on a limb and speculate about it.

I think they then ran this administration cools on value-added tax headline.

That's fine.

So that's kind of where we are.

And I think that's the perfect question.

I didn't mean to raise that question.

I was thinking about our own internal work.

Well, I think we've got an idea.

So I don't know if it's too precise.

It's not a precise subject.

We don't want to be too precise.

I have one more unrelated subject.

The bill is retroactive to January 1st.

And we are now through the first quarter of the fiscal year 1973.

payments for time periods after July 1st, there is a certain amount of paperwork to be done between the federal government and the recipients of the grants, and they have to be certified in one thing or another.

And so our thinking in the Treasury is that we should move it head fast to pay that six-month

and to take the next six months in a fight that will come next January.

Now, one could argue that because of all the certifications

could argue that we should distribute 3 quarters of revenue

to take the six-month buy-in.

And I might say, taking it that way, rather than three quarters, nine months' worth, will put us in a lot better position in financial markets.

And we wouldn't have to raise as much money.

And we are trying to lay off these markets so that we don't get interest rates going up too fast, one thing or another.

I don't believe that the six and nine months makes much difference.

We've got the six.

They all know they're worth it.

some $10 bills or something.

Right.

Well, thank you.

That was a long session.

Very helpful.

I want to talk to you before I go.

Thank you.