 Good afternoon. I have a statement which I'm being handed out, but I will read it for the sound media. All the information that we have confirms that the imposition of martial law in Poland has led to the arrest and confinement in prisons and detention camps of thousands of Polish trade union leaders and intellectuals. Factories are being seized by security forces, workers beaten. These acts make plain there's been a sharp reversal of the movement toward a freer society that has been underway in Poland for the past year and a half. Coercion and violation of human rights on a massive scale have taken the place of negotiation and compromise. All of this is in gross violation of the Helsinki pact to which Poland is a signatory. It would be naive to think this could happen without the full knowledge and the support of the Soviet Union. We're not naive. We view the current situation in Poland in the gravest of terms, particularly the increasing use of force against an unarmed population and violations of the basic civil rights of the Polish people. Violence invites violence and threatens to plunge Poland into chaos. We call upon all free people to join in urging the government of Poland to reestablish conditions that will make constructive negotiations and compromise possible. Certainly it will be impossible for us to continue trying to help Poland solve its economic problems while martial law is imposed on the people of Poland, thousands are imprisoned and the legal rights of free trade unions previously granted by the government are now denied. We've always been ready to do our share to assist Poland in overcoming its economic difficulties. But only if the Polish people are permitted to resolve their own problems free of internal coercion and outside intervention. Our nation was born in resistance to arbitrary power and has been repeatedly enriched by immigrants from Poland and other great nations of Europe. So we feel a special kinship with the Polish people in their struggle against Soviet opposition to their reforms. The Polish nation speaking through solidarity has provided one of the brightest, bravest moments of modern history. The people of Poland are giving us an imperishable example of courage and devotion to the values of freedom in the face of relentless opposition. Left to themselves, the Polish people would enjoy a new birth of freedom. But there are those who oppose the idea of freedom, who are intolerant of national independence and hostile to the European values of democracy and the rule of law. Two December's ago, freedom was lost in Afghanistan. This Christmas, it's at stake in Poland. But the torch of liberty is hot. It warms those who hold it high. It burns those who try to extinguish it. Now, first question will come from Jim Gerstenstang of the Associated Press. Mr. President, with the apparent, near words, Soviet involvement, how will this affect our relations both with Poland and with the Soviet Union, including trade and arms talks? Well, Jim, you're getting into the area there that I just don't feel that I can discuss. The area of initiatives and options that might be available as conditions develop that we may not be able to foresee. So I just am not going to answer questions or discuss what those initiatives might be or what our reaction might be. If I could follow up, have you made it clear to the Soviet Union how there might be some impact? Well, I think not only we, but our allies in Western Europe have made it very plain how seriously we will consider Russian intervention there. The repressions in other areas of the world. In recent days, the newspapers have been filled with reports of repressions by the Israelis and the occupied zones against the people there, even killing children, shooting and killing children. And annexing the Golden Heights. My question is very simply, how can the American taxpayer in good conscience continue to support aid to Israel with arms and money under those circumstances? Well, Helen, we have no observation or information, I should say, on any violence or anything that's taken that's been happening there. We have registered our disagreement and the fact that we do deplore this unilateral action by Israel, which has increased the difficulty of seeking peace in the Middle East under the terms of the UN resolutions 242 and 338. And we continue to address them with the idea, hopefully, that this action can be ameliorated. Mr. President, following up Helen Thomas' question, they're concerning the Israeli action on the Golden Heights. Mr. President, did you get any indications whatsoever from the Israelis that they were about to annex the Golden Heights before indeed they very quickly took that action? And secondly, Mr. President, I was wondering what effect you felt this unilateral annexation will have on the Camp David peace process and your hopes for peace in that part of the world? Well, I partially answered that with regard to the difficulties now with 242 and 338. We were caught by surprise. This was done without any notification to us. But apparently, other than a few hours interruption, the peace process is going forward. Egypt and Israel are continuing to work on the subject of autonomy. And we still continue to be optimistic about the Middle East, although we recognize that difficulties can arise. Doesn't it make your job a little more difficult in trying to bring the parties there together? Yes, but then I've come to the conclusion that there is a worldwide plot to make my job more difficult in almost any day that I go to the office. Yes, it is. It introduces a factor that has complicated things. Mr. President? Mr. President? Mr. President? By the way, yes. President Blacks perceive you as resurrecting states' rights through your block grant programs without any guideline and as being against affirmative action and you're wanting to prove intent in the Boarding Rights Act. They see all of this as a setback to civil rights. Now, doesn't this hurt the Republican Party as well as hurting Black Air with the evidence in the Virginia election? Well, thank you very much. I have to say that I think this may be an impression that some are trying to give because they're in disagreement with many of our policies, but I can assure you that this administration is dedicated and devoted to the principle of civil rights. And in spite of the fact that I do believe in returning more to our system of federalism, recognizing that there are functions that can be better performed at the state and local level, I recognize also that one of the prime responsibilities of the federal government is to assure that not one single citizen in this country can be denied his or her constitutional rights without the federal government coming in and guaranteeing those rights. I just follow up on that. You know, Blacks fought very hard and long to overthrow states' rights. I'm from Virginia. We had a pretty tough time. And now in your Boarding Rights Act, you are asking to prove intent. And when the government testified before the African Affairs Committee on the investment proposal, it said that while the intent of this bill may be good, we cannot accept the effect. So why is it in some instances you're accepting the effect in disregarding intent and then vice versa? No, we believe that the intent was a useful thing in that bill because there have been communities in areas of the country who have proven without question that their total adherence to voting rights for all their people and yet the difficulty of them then escaping the provisions of the law, which impose a burden on them, are still denied. Effect could, to use that instead of intent, the effect rule could lead to the type of thing in which effect could be judged if there was some disproportion in the number of public officials who were elected at any governmental level and so forth. And we don't think that that was what the bill intended or that that would be a fair test. You could come down to where all of society had to have an actual quota system. Sam? President, there are reports today of killings in Poland and more violence. What do you think the people of Poland should do? Should they acquiesce quietly to this martial law? Should they resist it? And if they resist it, what help will the United States give them? Well, again, Sam, you're getting into the area that I've said I cannot discuss of what our initiatives might be, what our options might be. I don't think those should be discussed in advance of any need for action. We have the report also, but we have no confirmation as yet with regard to today's violence and we're waiting to get that confirmation. Aren't we letting the Russians get away with it? With each passing day, aren't they solidifying their position? And in fact, there's nothing we can do about it. No, we're not letting them get away with it. And I thought that I indicated that in my remarks. But again, you are leading in another way into the area that I just don't feel would be proper for me to discuss. Mr. President, Jimmy Carter said that when he was in office, he also was the subject of perceived death threats from Libya, but he thought it was unwise to discuss it publicly. Could you tell us your reasoning behind making the charge public? And secondly, sir, can you say, can you comment on the concern of some people that your dialogue with Colonel Gaddafi has resulted largely in enhancing his stature in the world? Well, I haven't had any dialogue with Mr. Gaddafi and we did not make it public. The news claiming leaks from unidentified sources made it public at a time when we had held this entire matter confidential and secret for a long time because we believed that we had a better opportunity of apprehending any terrorists or terrorist squads if it was not made public. And so we're sorry that it was. And for anyone to suggest, as has been suggested lately, that we had some reason for making this public, we don't put that shoe on. And as a matter of fact, we made an effort at one point to call in some leaders in the media and ask for their cooperation in restraint and talk on this. And that then became the story on the news for that evening. Yes, ma'am. Mr. President, can you say at this point, despite the fact that you can't comment about the investigation, whether you think it would be proper as a matter of principle for your labor secretary to take an administrative leave if a special prosecutor is appointed? And secondly, whether you have sought some assurances from him that these allegations are not true? The matter of appointing a special prosecutor under the present act is one that does not connote guilt or any evidence of wrongdoing. And therefore, only under such circumstances as that maybe an individual would find they would not have time to perform their duties. And that is not true in the case of Secretary Donovan. I see no reason why they should step down while such a review is going forward. And yes, I have had assurances that there is no ground to these charges. You've had assurances from the Secretary that there are no grounds to these charges? Yes, yes. On the Golan Heights, do you believe that the Golan Heights should be returned to Syria given Syria's record of bombarding the Israeli farms for so many years? Well, now you're getting into the area of what is trying to be settled in the talks under 242 and 338 and the peacemaking talks regarding all of the territory that might be held. And therefore, that's not proper for me to comment on this. This is the very matter that's being negotiated. The following up, sir, your own opinion, did you ever object to the Arab legions occupation of the West Bank or the shelling of the Israeli farms? Well, you're going back a long way and it's hard for me to remember what my position was. I know where I was during the Six-Day War. I was in the Hollywood Bowl at a mass meeting in support of Israel. And at that time, there were only two political figures or office holders there that I recall, former Senator George Murphy, then a Senator, and myself as Governor of California. During your campaign, you didn't use many dips or maybes, but you said that you would balance the budget by 1983, possibly by 1982. Now, with deficits of $100 billion that's possibly in store for the coming years, why shouldn't the American people judge your campaign promises as harshly as they did that of your predecessor? But because in the first place, I said what was our goal, not a promise. But when I first announced my economic plan, and this is when those dates were used, was in September of 1980 during the campaign, the deterioration in the economy was so great between September and January that taking office, we had to revise our own estimates and our own figures and plan. And I have confidence in our plan that it is the right solution to the present problem. But again, like so many, we were caught while we always said that the economy would be sluggish and soft for the balance of the year and into 1982. We did not foresee a recession, and I don't think anyone else did, but we also did not foresee the interest rates remaining at the extremely high level for as long as they did. And may I point out, those interest rates did not just get high under our administration. They were up at that pitch before we got here, higher than they've ever been since the war between the states. And in the brief time that our program has been in effect, I have to point out that there's every evidence that we are on the right track. Now, I will be the first to tell you that I think it's highly unlikely that the budget could be now in these new circumstances, could be balanced by 1984, which was our goal, the target that we were aiming at. Difficult because when you start predicting figures, a change of one percentage point in the unemployment rate can result in $25 billion either way, depending whether it's up or down in your estimated figures for a deficit. But the evidence that our program is succeeding is the fact that since September, the interest rates have come down, some six or six and a half points. Inflation has come down to single digit when it had averaged 14, or it had averaged around 14 or better at the time that we took office. And we have cut the rate of increase in the cost of government just about in half. Now, we believe that these are signs, the control of interest rates, or the bringing them down, the reducing of the percentage of gross national product that the government is taking out of the private sector. All of these things, we think, are on the path of what will cure this recession, can't do it instantly, you can't undo in 11 weeks what it took several decades to create. But this is not a case of a broken promise. This is a case of circumstances beyond our control, whose foundation has been laid over the last several decades. If you get back to a question on the Libya hit squad. Yesterday, Senator Baker said that the chances of an assassination attempt upon you by this hit squad have been diminished. Wonder, sir, is that true? And secondly, is this hit squad still on the loose? Well, I understand that words come out from the senator's office that he did not have any intelligence information that would give rise to such a statement or such an assumption. Now, maybe he was giving an opinion and believed that things were cooling down a little bit. I think it would be very foolish of us to relax any of the security measures. And I can only tell all of you that our information on this entire matter has come from not one but several widespread sources and we have complete confidence in it and that the threat was real. Mr. President, I don't want to really just re-ask the same question, but I think it's something that is on the public's mind. What prospect do you see that the Soviet Union could become involved militarily in Poland and that consequently the United States could have to have some kind of military involvement too? Should we be relaxed about it or concerned about it? We aren't concerned about it. And beyond that, again, I can't say as to initiatives and we have no unmistakable terms with our allies, have at the Soviet Union know how the free world would view and how seriously we would take any overt interference or military interference in Poland. I'll ask the young lady. Mr. President, you said that you didn't see any reason for Secretary Donovan to step down after special prosecutor's name because the appointment of a special prosecutor doesn't necessarily mean that he's guilty. But I'm wondering, sir, that it's not only Secretary Donovan who's under investigation by the Justice Department, but also the CIA director, Mr. Casey, and your national security advisor, Mr. Allen. And I'm wondering that regardless of whether eventually we find out these minutes engaged in any wrongdoing or not, if you think that the fact that you're not taking action to disassociate them from your administration is going to hurt your administration or hurt your ability to lead them? I believe in the fairness of the American people. And I believe that in recent years there's been a very dangerous tendency in this country for some to jump to the conclusion that accusation meant guilt and conviction. And I think at its high time, we recognize that any individual is innocent until proven guilty of any wrongdoing and that's what we're going to do. I think that I cheated over here. I had recognized you and someone else took the place and I kind of nodded that you'd be next and I forgot about that. If you're sitting on Poland, I was wondering if you can imply that there'll be no more food shipments or other aid to Poland until martial law ends. Is that the intent? Well, I can only say with regard to that and again, we're getting dangerously close to initiatives. We have suspended the shipments that we were going to make because those were intended and we've had quite a record of humanitarian aid to the people of Poland. We would like to continue that, but under the present circumstances, we cannot go forward with that if it can be used by the government as a measure to further oppress and control the people of Poland. So we've suspended such shipments. There has been a report recently that that so-called Libyan assassination squad was not really under the sponsorship of Mr. Kaddafi, but that they were Shiite Muslims who themselves were opposed to Mr. Kaddafi. And secondly, that the U.S. government paid the informers, or at least one of them, a quarter of a million dollars for his information. Can you confirm those reports and are you still determined to go ahead with the evacuation of American citizens from Libya? We, I cannot confirm, I know nothing of anything of the kind that you said or that they are not the terrorist groups that we were led to believe they were. I, as I said, I'm confident of our information. I don't know anything about anyone being paid or not. And the last part of your question was, oh, the American people, here again, I regret very much the disrupting of their lives. And I know that they probably had the greatest relationship with the people of Libya, their own friends and neighbors that surrounded them and the fellow workers. But also, our information was such that it would have been irresponsible for us to not think forward to a possible hazard for them. And as this situation developed, and we didn't have any choice, the only choice that we had was that if we didn't do what we have done, there could have come a moment in which you all would have been asking me, why were we so irresponsible? Yes. President, during the campaign and in the early months in office, you used harsh, even strident terms to criticize the Soviet Union's policies and positions on any number of issues. But last month, you turned statesman in your message to the Russians about negotiating deployment of missiles. And last week, you intentionally used words about the situation of Poland that wouldn't rouse the Russian bear, so to speak. Should these all durations be interpreted as a change in tactics? Or should they be interpreted as a softening in your policy towards Moscow? No, and if I may remind you in the first press conference that I held over across the street in the executive office building, I did not volunteer any information about the Soviet Union. I was asked a question, and I answered the question to the best of my ability. And I think you will find that the teachings of Marxist Leninism confirm what I said. And at that time, what I spelled out was that they recognize as immoral only those things which would delay or interfere with the spread of socialism and that otherwise anything that further socialism is moral. Now, I didn't set out to talk harshly about them. I just told the truth and it's what Harry Truman said it was once, once with some people when they hear the truth. Mr. Dugan, some of the supply side economists have been saying lately that budget deficits don't matter. At least the size of the budget deficit doesn't matter. Some of your age refer to you as the supply side mole in the White House. I'm wondering if you agree that the size of the federal deficit doesn't really matter to an economic recovery. And how large a deficit are you willing to swallow in the fiscal 83 budget? Again, and I think that those economists who were quoted as saying that what they were trying to explain was that not that a deficit is all right and not that we shouldn't continue a program to eventually get us back, as I've said, within our means. But the important thing is whether you are following a program, consistent program, that will get us there. Not whether changing conditions such as we've had now with this recession have delayed the day by which you can do this. You have two lines that must converge. And they are the line of increase of government spending, the line of normal increase in government revenues, an increase that is regulated by the growth of the economy, increase in prosperity, not by increasing the rates. And we are embarked and the figures indicate that we are achieving this even though we've had a cut in the tax rates. It is that cut which is going to stimulate the productivity. And I think what they're pointing out is you can balance the budget by robbing the people, by imposing a punitive tax system on the people which maybe once will give you the benefits you want but then you will also find you've torpedoed your economy and you go right back into recession and lack of productivity and so forth because of what you're doing. The only proper way to balance the budget is through control of government spending which we haven't had for some 30 odd years or more and increasing prosperity and productivity for all. And that's what our program is aimed to do and I have every confidence it is going to do it. Mr. President, the gentleman. Yeah, Mr. President, back to your statement about the recession and circumstances beyond your control. I'm from Buffalo where the unemployment rate is even higher than the national average because of steel and autos. I'd like to ask you about something under your control. The people there most concerned now in the cold months about the prospect of decontrol of natural gas and estimates that it could double, triple or even quadruple their fuel bills in the winter. I'm wondering if in light of the recession that you might reconsider the idea of decontrolling natural gas. But we haven't made a decision on that as yet but let me also point out that everybody seemed to think the same thing would happen to the price of gasoline if we decontrolled oil. We decontrolled oil and the only increase that took place and that was temporary was one because of a, at the same time a current increase in OPEC oil prices and it only amounted to a few cents. Now I happen to believe in accelerating the decontrol of natural gas. It is scheduled to be decontrolled a few years down the road. I think that there might be advantages in accelerating that. I also find it difficult to believe that the price would double or triple or quadruple because the price that the retail buyer of natural gas pays. Only 15% of that has to do with the gas itself. The rest of that bill, and I think you'll find these figures are correct, is made up of the processing, the transportation, the delivery of the gas to the house and that would not be affected by a change in the well head price of the gas. Just to follow up, you say there's some advantages in accelerating, what are they to the consumers? In the long run to the consumer they're the same thing they were with regard to oil. That you stimulate the production of natural gas to the point that competition then, which has always been the thing that brings prices down, that competition enters the arena and with a greater supply competing for customers the price comes down. Now the gentleman right there and then the young lady behind. Thank you Mr. President. Speaking about natural gas, if you do accelerate the decontrol, do you plan to go with options? Your advisors are now discussing to tax it and possibly raising any other taxes to help balance the budget or at least hold down spending. Second part to that, and you now promise the American people and the American businesses that they, their tax cuts they just got will not be pulled back or somehow delayed. I sure can promise the American people that. And I think you all should know that I have met with some of the leading managers of investment firms in the United States. I have met with our Council of Economic Advisors that crosses the spectrum. Milton Friedman and George Schultz, Arthur Burns returned from Germany briefly for this, Alan Greenspan, Arthur Laffer, Paul McCracken, any number I should stop because I know I won't name them all. And I apologize to them for that. All of them are of a single mind with me. We stick with our tax program. We go forward with the reduction in tax rates and I have no plans for increasing taxes in any way. Everybody has a follow-up. Well, on the oil decontrol tax, do you now state that you will not increase or impose a tax on decontrol natural gas? I'm saying that I, my consideration of the decontrol of natural gas is on decontrol only. President, it's a season to be jolly and I wonder if you might reconsider hiring the air controllers to get travel in this country back on online. You did let them go back to work for the federal government and it seems a bit ludicrous that they can't go into their own trained field. Would you reconsider? I think that the conduct or the plan that we've had and what we have done is correct. There is a law that those who are fired under some kind of a cloud cannot seek federal employment for three years. We did ask for the waiver on that. We thought that was unnecessary, the pressure that they should not have and that was waived. With regard to any of them coming back, I think our first obligation is to those who stayed in the towers and who have kept the planes flying. But a number of the controllers have under the civil service regulations appealed their firing and I suppose it is possible that some may win their appeals and thus would go back. So that is the procedure and other than that, why I can't comment. Him and then I'll take you. He would always point it to him. I must have the worst aimed finger in the world. That's because mama taught me not to point. Mr. President, can you say unequivocally that if Richard Allen is cleared in the investigation by the Justice Department that he will be rehired or reappointed to his position and are you considering changing the role of your national security advisor so that the reports he gives you on foreign policy as well as those from the State Department come directly to you instead of being filtered through your big three? Well, the answer to the first question is that I can't and won't answer while an investigation is in process. I'm not going to comment anyway on that. On the second, it's not just a particular department. At about this stage, when you're new here and have put together an administration and it's been a very busy one and I must say a most successful one with regard to what we have obtained virtually all of our campaign promises have been kept with regard to cutting spending, lowering tax rates, eliminating useless regulations. For the first time in a few decades putting into operation a strategic defense program that I think is adequate to our needs, all of these things including last night's farm bill we have managed to do. And at the same time, I think you come to a pause like this where you review your processes and see where not only just one agency or department but all of them, where you can facilitate things, where you can perhaps loosen something that might have been a bottleneck. I still haven't found an answer to leaks but this is a, this kind of