 Good morning. Hi. Nice to meet you. Nice to meet you. My assistant, Harry Hilligos. Nice to meet you. Nice to meet you. Nice to meet you. Well, come in. Since they're one here. We've got, we've got, they're not here yet. They're gone now. Where's the other guys? Oh, you don't know the questions. I'm sorry. That's not a bad idea. You can move around. We're stuck once they get right here. There you go. Where are the children? Nice to meet you. Nice to meet you. Nice to meet you. Nice to meet you. Nice to meet you. Nice to meet you. Nice to meet you. Nice to meet you. Nice to meet you. Nice to meet you. They're here. They are there. They are there. Come and check. Nice to meet you. Nice to meet you. Nice to meet you. Hi. Nice to meet you. Nice to meet you. I'm there and there and there. Nice. It's a while. I have a question for you. Where do you watch the film set? I'm there. Got an issue with our transcri shout. That's a very good one. The machines don't get it all the way. We can provide you with a transcript or a tape. How about it. It's a good one. Should I say this? This is off the record? Just as you were coming in the door, I noticed that one of my ear buttons here went, wait a minute here. When it goes dead, you suddenly sound to yourself as if you're talking different down the rail or something. They only last about a week. Is that right? Well, we'd like to have you speak with us today about Ronald Reagan as manager. You've got the toughest job in the world, certainly. We'd like to ask you how you manage the presidency. We hope you'll have some practical advice that managers and American companies and government agencies might apply. Let me begin by saying, your friend Roger Smith of General Motors says that you've done a great job of focusing on the big picture without getting bogged down in the minutiae and in the details. We'd like to know which problems and issues you address personally and which you leave to subordinates. Well, I've never thought about what I do with regard to having a management style or not, but maybe part of it is dictated to me by a little plaque on my desk there that says you can accomplish it. There's no limit to what you can accomplish or do if you don't mind who gets the credit. And it is true that beyond that, I believe, first of all, that you surround yourself with the best people you can find and you delegate authority and you don't interfere as long as the responsibility and the overall policy that you've decided upon is being carried out. You don't stick your nose in there and tell them how to dot the i's and so forth and what they're doing. You only interfere if somebody isn't carrying out the responsibility in the cabinet meetings. And I guess it has been a little different. I know some members of the cabinet who have been members of other cabinets in the past have told me that there had never been such meetings. I use a system in there in which one thing I want to hear what everybody wants to say, honestly, and their views on the problems before us. I don't want, and I did this as governor to a cabinet in California and did it here, I don't want to hear anybody tell me what are the political ramifications of anything that we're talking about. That I want the decisions made on what is right or wrong, what is good or bad for the people of this country. But I encourage everybody, all the input that I can get. And this is what's led sometimes to those press stories since the walls of the building leak profusely, that they try to pretend that they're, or they say, I guess they believe it when they're saying that we're torn with dissension or something, no, we're torn with I want to know. And when I've heard all that I need to hear to make a decision, I don't take a vote. I make the decision. Then I expect every one of them, whether their views finally carry the day or not, to go forward together in carrying out the policy. I know that you do a lot of thinking about the future and speaking with people who study the future. And in your busy crowded day, how do you possibly make time to think about the future and to do what managers might call strategic plan? Well, I think that is the very essence of the job of all that you're doing, is aimed at a continuation of policy. And where those young people that come here every once in a while for one reason or another, children, you have to think of them and what you're doing and how it's going to affect the country they live in and the system under which they'll live. So I think all your planning is based on where it takes the country. Well, do you close the doors for 15 or 30 minutes every day and just look out the window and think or project forward? There are always times for that. But you know something I learned way back over the years, there's another place where a lot of things come to you very clearly. That's on the back of a horse. I have never given up riding and I do that whenever I have an opportunity and I'll be having about three weeks to do that just starting a week from now and we get to the ranch. But it didn't surprise me once when a doctor that I was going to told me that when he had a particularly worrisome, delicate operation slated for the morning he got up extra early and went out to the stable where his horse was kept in Los Angeles and went for a horseback ride and came in feeling much better equipped now to undertake that operation and I hadn't thought about it much at that time but since then I found out what he was right. But yes, there is time to do that. Mr. President, I'd like to ask you a little bit about your crisis management. What? Your crisis management. Yes. When the embassy in Beirut was bombed and the challenger exploded all your aid said you were very cool and rational. Corporate leaders face many crises too. Can you give them any advice on how to handle crises well? Well, I think it's making the decision. It's the uncertainty that I think leads to panic and upset. But in some things of that kind where the situation is so clear cut, Grenada, for example, I was supposed to be enjoying a quiet weekend of golf as a guest of George Schultz down at Augusta Country Club and awakened at about three o'clock in the morning with the news that a number of the other little island states down there in the Caribbean have come together and asked for our help and that they would be helping too but they did not have the manpower to do what needed to be done. And three o'clock in the morning and on the phone to Washington here I'd made the decision of what we'd do. And I think some of those I found are less troublesome. Some decisions of that kind where the facts are there before you and even sometimes if there's someone over here that's arguing for an opposite course the decisions that I think give you the most trouble are the ones where you sit in there at that table and you're all agreed on the goal where you want to be but there's a difference of opinion of how best to arrive at that goal and it seems that that's the one that when they've all finished expressing their viewpoints in there and discussing it and so forth that then I come back in here and sit down with that feeling of I've got to make a decision on this and because there's a little right and wrong in what everyone is saying there they've got reasons for saying won't this be a disadvantage if we go this way and so forth and those are the hardest decisions but the other one's actions such as Libby and others I don't know there the solution is pretty obvious it just takes having the nerve to do it. How do you make those hard decisions though? Pray, trust the instinct, say we'll go ahead and do something and always change it or what? Well, you said one word there I could I quote Lincoln Lincoln said he'd been driven to his knees many times in this job because there was no place else to go and he said he could not perform the duties of this job for one day if he did not feel that he could turn to one who was stronger and wiser than all others and yes I found myself doing that Mr. President you look as terrific as your pictures that led me to expect other managers in high positions sometimes seem to let the job drain them completely how do you pace yourself from day to day? Well, I have a little exercise routine up there I do at the end of the day I'm in as a long history of athletic competition all the way through school I have always been an evening shower instead of a morning shower so I don't get up in the morning early in exercise I go home from here in exercise then take my shower and contrary to what a lot of people feel without a rethink must go on in the White House every day why great many evenings most of them as a matter of fact you find Nancy and me then in pajamas and robe having dinner that early to bed but as I say it's the thing of it's the not it's the putting off of the decision that I think is wearing it's always back here and you wake up in the middle of the night with it no you have to sit down and go at everything that you've heard and I find here that usually I've made the decision if not within 24 hours certainly in the next in the second 24 it's so easy to become isolated in the presidency some of your predecessors have been said to have become isolated how do you avoid that how do you get out among the people how do you find out what really is happening of consequence in this nation and indeed the world over one thing I like people and always have but that goes with my previous life too I think most performers do too people your stock and trade there their pleasure was your success depended on their pleasure but no I think the very fact when you go to the ranch you're back in a whole different and surrounded by the people that everything from neighbors to the people that work for you and all I've never felt that I am isolated from people I grant you I can't suddenly say I'm going to run down to the drugstore any place I go anymore I'm a group and I can block traffic but here and the very fact of the people in the West Wing they're people like everybody else and they're not all top executives you get to know them and you know their problems and their troubles and I just never have felt that way and I love when we go out and like out on the road and the opportunity to be going someplace to make a speech I delight in getting outside the Beltway because there is a kind of a difference out there and I've always kept the friends in the context that go all the way back to school days Mr. President, many management experts seem to think that fostering a certain degree of conflict within an organization has good points as you mentioned before you get different points of view is there a point in your mind when creative tension turns destructive oh yes I don't believe in that kind of conflict of competition where you've got two people that are really at odds no that can get to be quite a strain if now and then you find that and I've got to work to get rid of such a thing but that's different than saying to everybody look don't hesitate don't try to guess what I may want to hear I want to hear what you want to say and so it took a little while in California it took a little while here for them to recognize that they could speak up and sometimes I sit silent and the conversation goes back and forth across that table disputing each other on points but it's that everybody could disagree without being disagreeable and I have found too that many times finally when I come back in here and make the decision I realize that you're going to be several to feel well okay their viewpoint was rejected and yet because the very next day it might be that I'm on their side what they say instead of the other I don't think any of them go away feeling any personal rejection they had their chance to say what they believed and they're satisfied you're known as a wonderful optimist but is there anything that you're hearing in those discussions now or sensing outside of the White House that has you worried a recession or perhaps an economic slowdown or what is concerning you now well all of this thing about recession or something all of the signs indicate no that is not the threat yes there are going to be some ups and downs we didn't make the gains in 85 at the level that we thought and yet then we had a fine quarter comes along so that the graft is kind of like that but as long as it's going on that upward tent now all the indicators indicate upward growth and this plus the fact of let's take unemployment the we have in these 45 months or so of recovery as of through June we had we were into almost 11 million new jobs created we created 201,000 new jobs in the month of June well no last month month of July 1,650,000 in the first seven months of this year we have 111 million people at work and it is the highest percentage of the potential workforce you know they look at talking unemployment they look at everybody between 1665 as the potential pool of employment and things of that kind we know that domestic auto sales were up this year so as long as those trends are going up there I'm not worried about that what I am worried about is the deficit not the trade deficit the government deficit I have insisted for a number of years it is structural it is built in to our government we've been running deficits now the government for more than 50 years more than half a century here and there there's a single year if you look in the past when maybe it accidentally came out even or so close to it but only a few spots here and there and then we went into a whole new thing with the great war on poverty a couple of decades back and this the goals the motives were fine compassionate and all of that but look what happened 1965 to 1980 in that 15 year period the budget increased to almost five times what it was in just 15 years the deficit increased to 38 times by 1980 what it had been before well this carried out what some of us were worrying about and campaigning against for years and that was that you couldn't go on without one day this getting out of control just as inflation if you remember during that same half century we always had a little inflation and they would tell us that it was necessary to maintain prosperity well some of us said if you keep on doing it one day it gets out of control and it did the double-digit inflation just here in the late 70s and by 1980 what is frustrating to me is that yes every year I submit a budget and every year there are individuals that are talking about I want to spend more money on this and this is my pet over here spend more no one as yet up there has faced up to except probably Graham Rudman Hollings now trying for the first time to set a goal of a balanced budget but no one has set out to say let's correct the structural flaws that now have built in ongoing inflation and this is... I could go on and lecture on the budget Mr. President a hard question to ask what is the worst managerial mistake you feel you've ever made I know it will be comparatively small the worst managerial if you had to do all over again in terms of managing I'm sure there are many things here and there and you look and say if we'd done this or that but I can't I just can't bring one to mind here of a thing not that mistakes haven't been made or situations have changed and things turned out wrong one glaring would be the terrible tragedy of our marines in Beirut now the decision was made and there was great agreement on it and the decision was made that with all those factions with their own militias and so forth that what Lebanon needed was the ability for the new president after the assassination of his brother the new president of Lebanon to be able to move out and reclaim for the official Lebanese military and all these areas that were being occupied by various factions with their own militias and that we would send in this force and it was, as I say our allies agreed with us it was four countries together that sent in forces for the same idea that we would send them in kind of behind the lines maintain order while the military and the government of Lebanon went forward to reclaim their country now the terrible part of the tragedy is it was succeeding and that's why the tragedy they didn't turn on the Americans and the French and the others there suddenly because they just didn't want us there it was the fact that they recognized that what we were seeking was going to be accomplished and this is why they termed their goal was through terrorism and so forth to get us to withdraw finally the accommodating terrorism was the result of a decision that maybe because the commanding officers didn't feel that we were in a combat situation so the moving for personal comfort to all as many of the men as they could into one building made possible that terrible tragedy Miss President you've started to address foreign policy people say that you're a very good negotiator because you have principles and because your timing is superb now recently you seem to have shifted from a strategy of tough talk to the Russians to one that's more conciliatory what made you conclude that it was time perhaps to make this subtle shift well it wasn't really subtle to me I came here believing that in years past there had been a lack of realism in our approach to the Soviet Union and we were sort of seeing them in a mirror image that if we smiled and were kind of generous and so forth they'd smile and be kind of generous I was blooded rather early with regard to communism in the motion picture industry great many people have forgotten some are too used to remember that there was a time right after the war when with so many of us gone in the service in Hollywood there are 43 gills and unions in the picture business most of them are Avavel CIO they had a thing called the Hollywood Conferences or they had an Avavel a labor council in which if one of those unions had a grievance and to the point of wanting to strike they went to the council because it could affect all those other Avavel CIO unions and so forth during the war there grew up a thing called the Hollywood Conference of Studio Unions now many of these were Avavel CIO Unions but they formed this kind of a rump and it had been taken over I'm talking now not of red baiting but I'm talking about card carrying members that their members didn't know that but that they were and they used a jurisdictional strike not a thing of wages or hours or anything there was a union there was always a rivalry between the craft unions and the stage hands it goes clear back before pictures to Broadway when a stage hand once upon a time in the theater he'd go out and fix the chairs in the theater if they needed fixing and then there was a strike and what the carpenters leading it back in those days insisted was the proscenium arch over the stage that would be the dividing line anything that needed carpenter work out in front of the proscenium arch the carpenters would do it anything backstage the stage hands would do it but when pictures came along it became the stages out there they call them stages where you make the movies and a thing developed in which you had a mill in every studio where the sets were made if this was to be duplicated they'd make this in the mill but it would be in sections and then you'd see them wheeling it on the wheels down the parts of it down to the soundstage and in it would come and then it would be assembled now the people in the mill were carpenters but the people that put it together on the set were stage hands called set erectors and they used this long-time feud this conference of studio unions to make the jurisdiction strike that no the carpenters ought to be able they should be entrusted with the job now there were only 350 set erectors in the whole motion picture industry so here was a strike to close down the motion picture industry to get 350 fellows they wouldn't make any more money they'd have any different working conditions they'd have to belong to a different union the motion picture industry I mean the actors the screen actors the ones that we faced what do we do we've got a contract with the producer we go to work do we observe these picket lines or do we go in which would be an effect on the side of the unions that are on the other side of that jurisdiction strike well I made a proposal to our guild board that we should invite both factions to sit down at a table with us and with management present and with us as the non-involved to ensure fairness see if we couldn't find a solution that would result in all the people of the motion picture business not being idle and losing their jobs well we did and we met daily and it became increasingly apparent that well to such an extent that when Pan, when Jam went on for a few months I didn't see anything new I'd been through it in Hollywood we would go home at night after a meeting and thinking boy we're meeting at 10 o'clock in the morning and we're on our way to a settlement 10 o'clock in the morning that other faction would walk in with a handful of lawyers and with 17 new demands that had never before been introduced until the day came when we the actors said to them that's all with the meetings the studio is open so far and we're going to keep them open and we don't know what you, the strikers are going to do you can get back into the business any way you want but this is all over you are only trying to shut down and it turned out we there was enough evidence and enough people who could leak to us that and weren't finally happy about what was going on that yes the target was close down the industry and then with everybody out of work the proposal would be made of one gigantic union consisting of actors, camera men, crew men everybody and guess who would control that one union well we won in the battle now I've gotten a side track here that I lost track of is that what you're doing with the Russians? is that what you're doing with the Russians? but you seem to be making more progress with them now and... realistic this is where I got side track I didn't mean to make that example it takes so much time but if you'll remember the first press conference I didn't bring it up a question was asked could we trust the Russians and I answered the question by quoting them now as time went on the press sort of diverted to where I was accusing them of being liars and sheeps and so forth but I quoted to them what the Russians themselves the Soviets have said in communism that anything is moral lying, cheating, stealing anything that furthers the socialist cause so they reserved under themselves the right to do these things and that the only immorality this is in all of their own writings immorality is anything that is inimical to the spread of socialism so I answered the question with those quotes and it sure did make the news but I wasn't going to retreat from that then it was about that same time or shortly thereafter that well in the downing of that plane that I referred to as an evil empire well we didn't we couldn't have any meetings because they kept dying on me over there the way they wanted to meet with and for months they would be in communicato you wouldn't even know what they were doing finally along came this new leader and do you get along better with them? do you get along better with them? yes and I think not because any difference he believes completely in their system I think he also believes they have grown up in their propaganda but at the same time he has big economic problems and he's realistic enough to know that he's going to make some moves to solve those problems resolve those problems and therefore we can sit down and talk to each other and I'm not sitting there saying oh gee if he smiles we want a victory okay this is again like back there in those negotiations he's got some problems that need solving we've got some problems that need solving and okay how close can we come together on something in which it'll be beneficial to both sides when do you think you can cut a deal with him? well I have to call attention to the fact that he is the first Russian leader in the history of the Soviets ever proposed reducing the number of weapons eliminating weapons they already have now that's a great milestone that says something about what their economic problem is and I think we can do business with him but it's going to be on that realistic note I find him affable completely different than many of the leaders that I've met with prior to this from their side but again I don't go with any illusions that I can convert him or talk to him or anything else he's got a system we don't like they don't like our system okay we've got to live in the world together do we want to live in the world fighting each other or do we want to live in the world at peace and I honestly think there's a basis for us being able to find agreement do you have any words of advice for American managers do you have any general words of advice for the managers of American business and the economy given that you've got the number one chief executive's job in the country and indeed in the world well yes I think it's I don't know that I should be advising them you see I've lived here under the illusion both as governor and as president that I was kind of copying them doing what the successful CEOs did well they'd like to copy you now well it's I think that you take a position and set a policy that you believe is the best way to meet your goal and get back to those three rules I said we followed in negotiations is it good for us, is it fair to the other fellow, is it fair to the customer or did I say that earlier you didn't say it earlier but we're delighted to use this was this was the guild's rule in negotiations is it fair to actors is it fair to the other fellow and is it fair to the customer we felt we could never demand something that would make a picture making so costly that they would either make a picture less good than it could be or would raise the price of admission beyond what it properly should be and we never violated those three rules and I remember an occasion when we won a point there were some independent fly-by-night producers that were victimizing actors you know actors aren't just all of a single breed as the contract player there's the individual that needs a union for working conditions and so forth and so what these fly-by-night producers were doing was taking a script and it would be getting thinner and thinner because there were a lot of actors whose salary and so forth was based on a guarantee casting officers go to ring and say hey we want you for this fellow playing the chairman of the board or whatever and it's several days well this fellow would have say a two week guarantee something of the kind but now if you had to take retakes at the end of the picture you didn't have to pay this fellow for those weeks after he had gotten his guarantee you then just paid him for the time that he was going to work on those retakes or added scenes these fellows were making the script so thin that then they were really saying it's retakes when they were doing the other half of the script and so we wanted this corrected well the good studios, the major studios they were doing this but we won the point finally the hardest one we'd bargained for but as the negotiations went on over the weeks as they always did and we'd have time in caucuses sitting around waiting for them to think about it finally the final day came the handshake the whole negotiations were settled and I said well there is one last point and the producer said what do you mean and I said 18B well they said we gave you 18B weeks ago and I said I know we're giving it back and their jaws just dropped and I said we've had time to think about it we're trying to get at anyway and they said we've just figured out that this would result in you maybe not doing retakes and added scenes that would improve the picture we would have made them too costly and we don't want to do that when we left the room the producers had called a meeting among themselves to see how they could police those others that were taking advantage of the actors very good well Mr. President do you want to stay another four years no and with all of this talk I do I strongly believe, I've come to the belief since I've been here that the 22nd amendment is wrong I think it's a violation of the people's democratic rights if they want to vote for someone we shouldn't have a rule that tells them they can't good lord we've got senators that have been there 40 years with congressmen the same thing but I have also always said and this has not been repeated enough please if you mention it I have always said any president who is promoting this or I'm not promoting it but is approving of this should make it plain it is being done for the president who will follow it no president can afford to sit in here and think of that kind and say do it for me so no I think I recognize that other people now have suddenly seen the wisdom of getting rid of that amendment but okay make it that it will apply to presidents from here on I'll go home Mr. President thank you so much I have a feeling you're still a buster to hear Mr. President thank you for your time thank you very much good to see you I hope you have a good time on the back of that board Mr. President doing that this weekend no not this weekend but next weekend we will we will try to go to the ranch because we're there for three weeks it's the same thing it's the same thing I'm sure you're going to thank you I don't want to answer there it's false sometimes people say to me gee you look so well don't you and then I pretend it's the truth and it really is and then I told the bell and when I go up a secret I say well do you know the story about the two psychiatrists do you know the story about them or the ones that Dapro they go to their offices and at the end of the day the young guys cops open the stairs and the house is slain the little boys just as dapper as he was finally they said how can you listen to them all day and look like that the little boy says he listens ha ha ha ha thank you very much thank you very much thank you very much