 Associated Press Radio, Mutual News, National Public Radio, RKO Radio Networks, Sheridan Broadcasting Network, and United Press International. Mr. President, thank you for allowing us to join you today. Well, thank you for the pleasure and the opportunity. Participants in today's program are Frank Cezno of Associated Press, Bill Groody of Mutual News, Ted Clark of National Public Radio, Joey Walt of RKO Radio Networks, and Bob Ellison of Sheridan Broadcasting Network, and Jean Gibbons of United Press International. We'll begin our questioning with Frank Cezno of AP Radio. Mr. President, with the lame duck Congress in rather noisy session, our gaze inevitably falls on Capitol Hill. Technically, many government agencies are out of cash today because there's still no stopgap funding authority. Now, you've threatened to veto the so-called continuing resolution if it contains what you've called pork barrel jobs bills. The fact of the matter is the Senate has voted $1.2 billion to that aim, the House $5.4 billion. The estimate is you'll get a compromise that contains somewhere in the area of about $2 billion. Isn't that the bottom line that you're going to be able to accept, in light of the trouble you've had with this lame duck session, are you going to take Senator Hatfield's suggestion and take the $2 billion in run, or are you going to stand and fight? Well, obviously I have to wait and see what comes down to me and what's in front of me before I actually say veto the other way, but I have to tell you this. I cannot sign that bill. I will have to veto if it contains these various amounts that have been suggested because in truth, these aren't job-creating bills. The 5.4, for example, that was introduced in the House, I think that a great many congressmen, in fact some of them openly admitted, were calling it a free vote in which they could apparently vote for a job bill knowing that I would veto it and that they wouldn't have to live with it. Actually, that 5.4 is not a job-creation bill. It is a pork barrel and filled with all sorts of projects, many of which wouldn't create employment at all and many which wouldn't create employment. Well, one in particular wouldn't even be effective until 1985. That's not going to help the unemployed today. But also, many of those would, whatever work they would create, would be at a tremendous cost. For example, in the Bureau of Reclamation Project that has been included in there, it would cost $49,000 for every job that would be created. In the General Services Administration element that's in there, that would be $25,000 per job. And as I say, there's another one, a billion dollar program that wouldn't begin until 1985. So I just think the answer to recovery has to be, or to unemployment, I should say, is recovery. And anything that adds to the deficit and delays, economic recovery, is going to set us back far more than any temporary job. The military bill, the Pentagon asked for less than half of the amount that they've added in this bill in the House for military residence construction. So there's half of that that wouldn't even be spent. Well, now you seem to have made up your mind already. You say, if those figures that I mentioned are the figures that actually reach your desk, you would have to veto. What is there to study then? Well, the thing is, if it contains the things that are originally there, if on the other hand, they come down with some addition to this that is in another area that you look at and say, well, there is a value to this. And while I would prefer that we not increase the budgeting, I would have to look and see, does the value offset the risk of adding this to the deficit? But when I was talking here, I was talking of the things that we presently know are there. You know, a couple of an orange and an apple went into the conference committee, it might come out a pair. Mr. President, the continuing resolution will probably also contain the MX proposal. And you've just appointed a commission to look into the basing options for MX. I was wondering, giving the complexity of that task, is it realistic to expect them to report by March 1st, or could that date somehow be slipped? I think it is because of all the study and research that has gone into this before. This whole thing came about. We asked originally for money to begin the process of building the MX. We don't even have an assembly line for building missiles. That was done away with previous administration. And we asked for the right to put the first ones off the line into Minutemen silos while we continued to study a basing plan. The Congress denied us the right to do this, the ability to do it. And so we continued study and the dense-pack basing mode, and it may still turn out to be the one that has the least warts. There's something wrong with every system. But I was required to come up by December 1st, having selected a basing mode. And this was the best one that we had on hand. So there was no opportunity to consult with them or for them to have access to all the study and the research that had gone on. We hope now in these few months that we can present everything. And if some of our scientists come up with a new and improved mode, we'll take a good look at that one. Are you willing to accept whatever the commission comes up with? Well, it would depend on whether there was other agreement with the commission, too. And by that, I mean the expertise of our own military people who were going to have to use these weapons if they're ever used. And let me add here, unless there's misunderstanding of that line, the real purpose of those missiles is to never be used. We're trying to create a deterrent that will prevent there ever being a need for the moral war. Mr. President, I'd like to follow up on Bill Grootie's question here. You have spoken about a window of vulnerability. And you've said that the United States, in terms of defenses, is inferior to the Soviet Union in many areas. My question is, looking at US defenses overall, would you trade American forces for Soviet forces? Obviously, the answer would be, as it's been for many military men. No, because of my faith in America and in the young men and women of America who are in our armed forces. But I still have to say that to continue as we had been in the previous decade and the last several years, leaving those fine young men and women with tools incapable of doing the job, endangering their lives by lack of training, because we were denied the fuel through budgetary restrictions to fly airplanes as often as they should. On any given day, when we came into office here, only half the airplanes in our air force could be flown because of lack of spare parts. Only half the ships could leave harbor for lack not only of spare parts, but of a complete crew. So what we're trying to do is make sure, and we have made remarkable progress. There is an esprit de corps in our military today and a pride in the uniform that I think would bring a glow to every American's heart if they were as aware of it as I of necessity am. And so the answer would be no in that one way. But if you ask me, is there still a will to a vulnerability? Do they have a superiority and firepower and so forth? The answer is an unqualified yes. You can't help but look at the NATO line with more than 300 triple warhead missiles in immediate range aimed at the targets of all of Europe, the Middle East, and Northern Africa. And we have none in that theater is a valid comparison. But, Mr. President, we also do have submarine missiles in the area which would serve an intermediate missile function. And they have submarines and submarine missiles. And a part of the threat is not only what's on hand, it is that at the moment their rate of increase in their weapons compared to ours. In the last 15 years, I think they added some 60 submarines, nuclear submarines, but we were adding none. Just one last follow-up question. We are adding the Trident submarine, though. Are we not at this point? Yes. And they're adding one that's bigger and carries more missiles. Mr. President, what if this commission that you're going to appoint comes back to you and says the Mx may not be such a good idea? After all, let's have a modification of the Trident or some other variation on the missile. Would you be willing to accept that kind of recommendation? Well, we'd certainly look at it. It would be difficult for me to think that we could, knowing the length of time that it takes to get something researched, tested fully, and then into operation, even with this Mx and with all of the work that's been done so far. That system won't begin to be installed until 1986, won't be operational. So for logistical reasons, you would be inclined to stand firm on the Mx as a system. Yes. Let me just say, though, unless you think I have a closed mind. If a miracle happened and someone came along with something that could be implemented better and sooner, obviously, we'd choose that. Mr. President, I'd like to move to a different area. In Boston, during the period of budget cutting, the First US Circuit Court of Appeals ruled that white police officers and firefighters be laid off rather than blacks and Hispanics with less seniority. This was done to preserve or to maintain minority percentages. Why did your administration ask the Supreme Court to strike down the lower court's order? We did it because, number one, in the law itself, it says that hiring or firing cannot be on a basis of race. And secondly, that the federal courts have no authority to come in with regard to overthrowing seniority. There is a third reason. I'm old enough to remember when quota systems and so forth were used not to end discrimination, but actually to legitimize it. And the precedent that would be set, if this policy, which is embodied in law in all of seniority and layoffs, is used in this instance, admittedly, to try to keep a better balance, which we're all in favor of in public employment in that area. But if that precedent is set, that seniority is meaningless and that purpose, someday you could find an administration that wants to turn it around and use it to go back to what we hopefully have gotten rid of in this country, a discrimination against minorities. Well, there could be or there could have been other options. Let's say, for example, some sort of proportional layoff system, which I understand the U.S. Civil Rights Commission had recommended, but why shouldn't affirmative action supporters view this voluntary entry, your administration's voluntary entry into the case, as an attack on affirmative action? Well, maybe some of them will, because an image has been created of me. I know that I do not support these anti-discrimination measures. The record, in the other hand, proves the reverse. As the governor of California, I appointed more minority members to executive and policy-making positions in the state government than all the previous governors in the history of California put together. Here, we have already, and we haven't been here two years yet, we have 130 members of the black community in top executive positions, beginning with Sam Pierce, a very capable member of our cabinet, and to assistant cabinet members, and this includes, and then added to that, we're doing the same thing with regard to women, and we're doing the same thing with regard to Hispanics. The most recent Hispanic employee is one I'm very proud of, Everett Alvarez, who has the record of having been held in captivity the longest as a POW in Vietnam, and he is the deputy administrator of the Veterans Administration, but we are record there, but also, if you look at the Justice Department and the Equal Employment Opportunities Commission, you will find that we've broken all records in the history of the national government with regard to hearings on violations of civil rights, on trials, and on successful convictions of violations of those civil rights. So I think our record, and incidentally just yesterday, I signed a paper with a group of minority small business people that is going to increase the amount of procurement that the federal government buys from minority-owned businesses. Mr. President, I'd like to turn from affairs of state to a matter of pure politics. Some of your fellow Republicans would dearly love to run for your job two years, hence should you decide to give it up, and the more time they have to get organized, the better off they're likely to be, would you tell us now, sir, what your intentions are in 84, or at least give us a timetable on when you will be announcing a decision? Well, I assume that such a decision will have to be made sometime next year, but I think it is too early now, and as I've said, as to whether I've made a decision or not, I've always said I think the people kind of have a way of letting you know which way that decision should go. But to make that decision too early, or to make it public too early, is to do one of two things. One way you're going to become a lame duck and have no authority to do anything you're trying to do, or the other way, you're going to open yourself to the opposition charges that everything you do is political based at the next election. And I have over and over again told my staff and told our cabinet that I don't want to hear the political ramifications of any issue that comes before us, I want to decide it on the basis of what's right or wrong for the people. I get the impression from afar that the job may have lost some of its appeal, especially for Mrs. Reagan as a result of the assassination attempt. Is that true? Well, I know that this was quite a traumatic experience for her. I also know that, you know, the government, the first lady gets an employee free. They have her just about as busy as they have me. But no, she's made no decision either. She and I are together on this. But I have to tell you, frankly, I have enjoyed the opportunity of dealing with the problems that are before us. I think we've made great progress in a definite turn in government and turning away from some of the things that have brought on the very economic crisis we're suffering from. And it has its drawbacks, of course. You kind of live in like a bird in a gilded cage and I sometimes look out the window at Pennsylvania Avenue and wonder what it would be like to be able to just walk down the street to the corner drugstore and look at the magazines. I can't do that anymore. Let's pause here briefly to remind you that you are listening to a conversation with President Reagan. Our participants today are Frank Cezno of the Associated Press, Bill Groody of Mutual News, Ted Clark of National Public Radio, Joey Walt of RKO Radio Networks, Bob Ellison of Sheridan Broadcasting Network and Gene Gibbons of United Press International. We continue our questioning with Frank Cezno of AP Radio. Mr. President, I'd like to pick up, actually, on what you just said about being a bird in a gilded cage. How does a president know? How do you know what is going through people's minds and what is happening, especially vis-a-vis all the very high levels of unemployment we have now? You can't walk down to the corner drugstore to buy a magazine. How can you know what it's like to be unemployed? Well, you, the bird in a gilded cage referred, I think, to our own use of leisure here in the White House and the security problems that entail my going anyplace. But you aren't that separated from the world. First of all, the people that are all around you, the people that are a part of your daily activity, right here in government, including those various security forces. But when I go to the ranch, some time out there, I'm right back with the neighbors and the people that work there and it's as if this had never happened. But of course you do. And as to an understanding of unemployment, that's another advantage of my age. I was seeking my first job in the very depths of the Great Depression in 1932. I have seen all the tragedy that brought, including in my own family and my father. And I don't know any other way to describe this other than that you do go out and you, like in campaigning, when you go out regardless of the security, you were there again with the people only on the street but in the meetings and you just aren't separated from them. Let's carry on with the unemployment thing, if I may, on a political level, on a philosophical level. What is the need for government to appear to be doing something? And by this I'm talking about jobs bills or some sort of lead initiative effort to get people back to work. Economically, of course, your position is well stated but philosophically and psychologically for the nation a sense of going someplace, doing something, activity. Yes, and you've used the word psychology. There is a great psychology that is a part of a recession, both for good or bad. And I have to tell you that right now I think the media has overemphasized the bad for whatever reason but generally in a sense that psychologically has not been of help. The sense of doing something, this has been what's wrong in the several recessions that have taken place since World War II and the artificial quick fixes of government, rushing in with supposed job program and so forth. And it is every time it has been a temporary quick fix. And every time there has been seemingly an improvement except that inflation goes up and each time at the end of the so-called recession unemployment remains higher than it was before the previous recession until we finally reached the point that we are now, the worst of all the recessions. But the things that the government has done, we know that it was the high interest rates over a long period of time and that began back in 1980, reached 21.5% in the prime. Those high interest rates that started shutting down the automobile plants because people could no longer afford to buy cars and pay the interest on the installments. This then spread to steel and glass and rubber and all the associated industry. At the same time, another base industry that usually is the first one to mark recovery, housing, no one could afford a mortgage at the rates that were being charged. But we have now brought, first of all, inflation as a basic cause of those high interest rates. We've brought inflation down from 12.4% to less than 5% now. And following it down in the last several months particularly has come interest rates down to less than half or about half of what they were. And I think they're going to continue to go lower. And both of these have now resulted in the housing industry being today about 27% better than it was a year ago. The housing starts. Sale of new houses is up 45% in the last six months. And permits for housing are higher than either one of those two figures. Now this is going to have to be seen out there. The trouble is things like that aren't being as visible. Now we have done some other things. We have asked for and obtained passage of a bill, a training bill. And this training bill is a little different than some we've had in the past. It's going to be implemented at the community level in keeping with industrial leaders and local political leaders at the community level to create or to train for the jobs that are going begging in those communities. Every Sunday in the metropolitan areas pick up the Sunday paper and look at the number of help-wanted ads. Here are employers begging for employees taking ads out for them at a time of the highest unemployment that we've known since the war. And the reason those employees aren't available is lack of skills and training for those particular jobs. Mr. President, if I could return to events on Capitol Hill for just a few moments. It looks like the Senate will take up the five-cent a gallon gasoline user tax to fund highway construction, probably tomorrow. And I was wondering once debate gets underway, do you plan to get actively involved to break the filibuster and get that through? Well, I've been trying to help already and I would try to help some more because I think it is ridiculous for a minority to stand in the way of this bill, which has a great emergency context to it. And only in addition, as a sideline benefit, would create as many jobs as the Democrats claim their $5.4 billion pork barrel would create. The emergency situation is the number of bridges in this country that is so risky today that school buses stop and make the children walk across the bridge before they take the bus across. The highways that are so deteriorated that many of our business firms are adding to the cost of the things you buy because they have to reroute it costs of millions of dollars a year, their trucks, to avoid stretches of highway and bad bridges and so forth that would cause them problems. Ted. Mr. President, there are reports that the Bulgarian Secret Service and perhaps even the Soviet KGB were involved in the attempt to assassinate Pope John Paul last year. Do you believe that's possible? Well, I don't think I should express a personal belief on this now. I do think that since an investigation is going forward on this, I think it's a little delicate to for a head of state to give an opinion one way or the other. But you would rule it out or you don't rule it out? No, I just say I'm going to wait and see what the investigation brings. Mr. President, your Social Security Commission seems unwilling to get off the dime and make a recommendation of what should be done to save this system that's on the verge of collapse. Now, you're the one man the country has elected to be a leader and this is one of the most pressing problems we're facing. What are you going to do? Well, I'm going to wait to see what they come in with. Those people who have suggested that I should interfere now and put some pressure on the Commission are ignoring the fact that it was after the issue of Social Security had been made a political football and not by us by the leadership in the House and became such a political football in the last election that I then said the only answer to this is since they seem reluctant to deal with the emergency situation in Social Security is a bipartisan commission. So the Speaker of the House is appointed members, the minority leader of the Senate is appointed members, I have appointed members with the hope that they can come in with a recommendation that recognizes a bipartisan viewpoint so that we can approach the answer to this in a bipartisan manner and not again as a political contest. For me to stick my nose in and try to tell them what to do, we've had reports from them, we know what they're discussing and we know that there are some varying views in there but even if they will come back with let's say alternatives, a couple of alternatives so that at least you can then sit down and say all right, let's find a meeting ground between these two alternatives but to keep it out of politics and again at the same time, let me take advantage of you and say to the senior citizens listening in, no one is trying to take their benefits away from them or cut them back. That was one of the musts that I gave to my appointees. I said the people presently dependent on social security must know they're going to continue to get their checks. Well, their deadline is running out. Are you convinced they're gonna come back to you with a recommendation? I'm hopeful that they are. I know where they stand because I say I've had reports. I know where their differences lie and they're not all that great. They really aren't. Mr. President, South Africa, how long will you pursue your policy of constructive engagement to bring about independence for Namibia, particularly in view of last week's rate into the SOTA? Well, we let them know our unhappiness about that, but we have made progress and we've made progress with both factions there and with the other frontline states in Africa and we're going to continue and do our best to settle that peacefully. Mr. President, you have King Hussein of Jordan coming in here next week. He's been described as the lynchpin in your Middle East peace initiative because of your proposal for the Palestinian entity. What do you think are the prospects of bringing him on board the Camp David process at this point? King Hussein is not only a very intelligent and responsible leader, but I think that he is very sensitive to all of the problems that are involved and very sincerely desirous of peace in the Middle East and a resolution to this problem. And I think that he will be cooperative and I think we can count on him for that, but the main thing right now that we have Ambassador Habib and Draper working on in the Middle East is to get what now constitute armies of occupation, the PLO, the Syrians and the Israelis out of Lebanon and let the Jamile government have the sovereignty of their own country. I call them armies of occupation because there was a time in which Lebanon with all of its troubles and its divisions did have to welcome them in an effort to create order, but now that government has had enough confidence to ask them to leave for them to continue to stay against the will of Lebanon, makes them technically armies of occupation and we're working on that. That is the first step and then we move to the peace process involving the Palestinian problem, Israel and guaranteeing the security of Israel's borders. There's a report today, sir, that you have told President Jamile of Lebanon that the US will guarantee the withdrawal of all foreign forces by the end of February. Any truth to that? There no, there is none. We've set no date, no timetable, but I will say this, Ambassador Habib will be reporting to me Monday, but when I sent him on this most recent trip over there, I told him that no longer are we talking about a peace plan, we're now talking about action, a plan for action, let's get it done and let's get the forces withdrawn so that we can proceed with the other steps. I see we've run out of time, Mr. President. Thank you and Merry Christmas. Well, thank all of you and Merry Christmas to you and to all listening in. You have been listening to a conversation with President Reagan. We'd like to thank President Reagan for allowing us this half hour of his valuable time and thanks too to our participants today. Frank Cesno of the Associated Press, Bill Grootie of Mutual News, Ted Clark of National Public Radio, Joey Walt of RKO Radio Networks, Bob Ellison of Sheridan Broadcasting Network and Jean Gibbons of the United Press International. From the Roosevelt Room of the White House in Washington, good afternoon.