 The President of the United States. Thank you very much. Well, thank you very much. And welcome to the White House if someone hasn't already said that. I'm delighted to be here. And I know that you've had briefings on social security and energy, transportation, and the budget issues. And I'd like today just a word or two in a very brief monologue about the economy and federalism, which is still very much a priority with us. I know that this last year has been painful, especially the state and local government level. And your job hasn't been made any easier by the recession and the accompanying unemployment. But here at our end, as you've probably already been told today, we didn't believe that the answer to your problems or our own is going to be another try at a quick fix and that we've had in the past. And then a couple of years later, things usually turned out to be worse than they were before. In the past 20 years, we've had two periods of sustained economic growth and in each case, inflation increased. And the result was that both of those periods were followed by a new and an even worse recession. Now, we felt that the only way to not have that same experience repeated was B, to have growth, but growth that was non-inflationary. And I think we've come a long way in that and I don't mean to suddenly stick myself way out in front as saying everything is going to be rosy day after tomorrow. We know better than that. But last year inflation from the 12.4 that we knew was down to 3.9% for all of 1982. And for the last six months, it has been at an annualized rate of less than 2%, as a matter of fact 1.4% for these six months. The economic recovery does seem to be taking shape. The index of the leading indicators went up in January at 3.6% and that was the biggest single increase in 33 years. The construction spending in January was also up at an annualized rate of 8.4% and that was the highest since 1946. Auto production is up 50% over a year ago and we've just learned of the steel industry calling 20,000 of its layoffs back to work. That can't be described as more than a start, but it is a start. Other indicators of the same kind including letters that I'm getting from independent businessmen represented in the small business community. I have just one, a man has just written me and I just answered his letter this morning. He wrote to tell me that they checked their December figures. He's in a building supply company and found they've been in business for 30 years that the last month of December was the highest month they've had in the 30 years and January was just a little bit below December but still way above anything that they'd ever known before in their business and these things are coming in increasingly. To keep this going, we know that the answer has to be a continued slowing of federal spending. Now with regard to federalism having said that we've sent our information or our legislation on that up to the Hill. It calls for four mega block grants as we're referring to them. It is not a budget balancing measure or intended to aid us in that respect. What we have in mind is that what Congress will approve for us in the 84, in those block grants we will freeze into the budget for all the way through 88. We propose to retain revenue sharing as we think it is one of the most practical things for all of you and we're going to fight hard to continue as you know we have made some gains in restoring the distortions that have taken place over recent decades including some things back, authority and autonomy at local and state levels of government that has been seized with the federal government. I remember the first vote I cast in 1932 for the New Deal and I remember that the platform upon which FDR ran that time was a platform that said that the federal government pledged to restore to local and state governments and to the individuals constitutional authority and autonomy that had been unjustly seized by the federal government so I'm going to make that vote pay off if I can. But now that's enough monologue you've had enough of that all day long maybe there's time for some questions and a little dialogue that we can have here. Yes. President, Senator John Stoffer of Pennsylvania if you know many of us in the Northeast industrial states have hit awfully hard in the unemployment situation and even though we've been trying to wrestle with our unemployment compensation problems we still have been forced to come to the federal government for some help in the form of loans the interest on those loans is a real backbreaker for us. Is there any chance that we can get some help as far as the interest is concerned on the repayment rather than let us pay the principal give us a little help on that interest. Well I don't know what the situation is there I do know that we have we have legislation right now that's before the Senate and has passed the House an entire bill that includes spending on our part for unemployment insurance and some measures that you're probably very familiar with or have been briefed on already about trying to find a way in which unemployment insurance can be used for well as options for employment instead of taking the money take it to an employer and he gets the option but the individual gets the job job relocation training and other things of that kind I must confess I haven't been in any discussions about the problem that you just named there and what it is but let me get into some discussions about that Alright Yes ma'am yes and I'm glad that they I can remember when they didn't make the questions respectful back when I was a governor but yes we are I think there's been a great deal of misinformation and I have seen news items about students in other parts of the country and I think they've been misled as to what we have done with regard to college aid we are providing aid for some five and a half million of the twelve and a half million college students in the country today what we have done and I'm sure that there are some individuals discomforted by this we found that we felt with what we could do that some of that aid was being aimed toward families that should be expected with their incomes to take care of the situation themselves we've changed that and redirected that aid toward people of lower income so I think that we are doing as much as has ever been done but it has been redirected with regard to loans and the low interest college loans that we've also done that we found out that we were providing some of those loans that when the interest rates were so high that there were families that were getting those low interest rate loans they didn't need the loan to send their sons and daughters to college but they were then reinvesting that in government bonds at a higher rate of interest in making a profit on that loan and sending their kids to college at the same time we tried to correct some things of that kind but I we've got to do more to make them understand that because I think there must be a great deal of fear among any of them that there is still as much as has ever been done for them but more of it is redirected as I say toward those of lower means Republican administration and your administration here we thought things were going to take off well of the work fair program we have an unusual ability in Land and County with casinos in getting private sector involved I spoke a rich about this but just so you might know we have been experiencing some problems getting from the state house in training with your people here in conflict and regulations and we have a very good program that's called STEP which is coinciding with your wing program but I just wanted you to be aware that even though we have the ability maybe peculiar in Land and County because our economy is growing up as other people may not it's getting started and I didn't get into the rich one but I just wanted you to be aware of that I think sometimes you don't hear these things well is this work fair in connection with able-bodied welfare recipients well I wish you well and I don't know just where your plan is or how far but we started an experiment of that kind that time the federal government would only allow us to perform it in part of the state in California when I was governor 35 out of our 58 counties but what we did first was ask local levels of government from school districts on up through city and county governments to send us lists of work that as we described it that if they had the money and the manpower they would be performing and then we looked at them to make sure that these were legitimate jobs and not dig a hole and fill it up again type of work and we approved those jobs and then when the day came they were allowed to order that the able-bodied welfare recipients had to report and they picked out the jobs where they were to go and report for assignment and work at these jobs they only had to work about 20 hour a week and the rest of the time was supposed to be devoted to looking for a job or taking job training and we assigned some of our people from our labor department as job agents we call them to take a cluster of these people as an agent would and they were his clients and to see how quickly they could get them out of that work fair and into a private enterprise job the first plus in the program were the thousands who never reported and we just stopped giving them their checks and never heard a single complaint because I'm convinced that we only know how many checks we're writing we don't know how many people are actually getting welfare and these had to be what I call paper people that they knew if they reported for that job it would be learned that they they weren't real welfare recipients this was during the 1974 recession and through that job program we funnel 76,000 welfare recipients into private enterprise jobs in the middle of a recession by the use of that I'm only giving that experience I don't know what your situation is but I'm a great believer in this I think that because those that did report I think that the bulk of welfare recipients want nothing more than to be out there independent making their own way free of the case worker and it turned out that way but well all right I guess yes ma'am then I got to come over this way I was good to say that thank you very much believe me the cabinet meetings are much more attractive but both of those people that I know are going to do a tremendous job and one of course has been in the congress the other one has been here in our administration Elizabeth Dole and has been doing a tremendous job and that's why she was moved to where she is right yes well I appreciate that I am a great believer in private initiative in the private sector and I think that's great and I'll really be watching to see what the result is on that yes I have to tell you I if Jack Block were here I'd answer that question for you I don't believe that I can give an answer here as to what it is you're comparing and what the problem is I know we've been trying to solve the dairy products problem which I know you're talking about trying to resolve that and find an answer to it for quite some time but I don't know the details this is I got that it's Congressman Jeffers and Bill that he's I will look into that and find out what that legislation is and I shall also talk to Jack Block about it well we don't think that there's any comparison between what it is we're proposing and the old CETA program for one thing in the CETA job training programs only 18% are actually going to training in our job training 70% will be going to actual training but also the jobs themselves what we've done is not create some program of jobs as some of those other programs did we looked ahead and saw that our own agencies and departments had all kinds of work construction maintenance repair and so forth built into budgets in the outgoing years and beginning in and what we've just conceived of is the idea which isn't new money at all but simply say wait a minute the time is now where we need jobs and to accelerate and move up and start doing those already approved jobs now instead of in waiting for 84 and the years beyond to do them and that's a part of the package that is up there before the senate now that we'll accelerate that work to create some employment there no I don't excuse me not in the emergency jobs bill that's now being tied up by that withholding provision there's not the there's not any public service jobs similar to CETA it is true the president's proposed last Friday a structural jobs bill which is much more far reaching and there is reports that some in congress will attempt to tack that on but that's not part of the president's package now all right you bet and the prices have been going up not consistently in one place there will still be due to the mixed up nature of that bill someone that some community that's doing just fine but in other areas well the most recent price increase in much of the country was 20% and this was under decontrol and we looked at what we did the decontrol of oil and everyone said that we were going to have $2 gallon gasoline well we decontrolled oil and we have gasoline to less than a dollar in most of the country today we think that putting in a protection clause to make sure that someone can't run wild we believe that what we're doing is going to bring the price of natural gas down there's an awful lot of natural gas in this country that is capped right now because it's uneconomic for them under the control laws to bring it out and make use of it so we are going to protect against that there was a lady right back there and after her one more question well now thank you very much I have to tell you the gender gap yes I take it seriously I'm very disturbed by it some of my best friends are women and I feel there's a little injustice done here because I think we've done better than most administrations have in that regard and I want to continue that what I need from all of you is how do we get the word around we're doing this I'm going to go back row there because they tell me I've used up my time well we had passed that as a part of the tax package and our reason for passing the withholding of interest was the fact that we have found that one of the big loopholes well I shouldn't call it a loophole that gives a wrong connotation one of the big places where people who avoid paying the tax they owe is in the area of interest and dividends and the treasury department there's just no way to have the manpower that would be required to try and plug that and track down these individuals we estimated at around $5 billion a year of taxes owed legitimately owed that are not being paid and in this time of deficits when we're trying to get these over down to a balanced budget it seemed to me that we were entitled to go after this money now I think there's been a great distortion here also on who we're asking to do this people at whose receipts are lower lower income and who interest that they may have on a savings account is lower they don't have their exempt almost everyone over age 65 is exempt and so there's really only a small percentage of people that are going to be affected by this but it's also going to include that percentage of people who are not paying the tax they owe and so we feel that this should be given a it was passed to now before it even goes into effect we delayed it of the interest of the banks and the savings and loans companies from going into effect in January and delayed it 6 months to July to give them more of a chance to gear for this and actually this whole idea that this is penalizing somehow the saver we find that the the withholding the increase in taking say some of that money away that interest money before it might compound more is something like and Rich correct me if I'm wrong but I think the figure is something like about it costs about 50 cents out of every 150 dollars something of that kind which we don't think is really a hardship on anyone now your senator is tagging this onto a bill that he feels I would not want a veto and you know what that brings me to all of you who are out there at the other levels of government were if you join me in a drive to give a president of the united states for the first time the right to line item veto we wouldn't have these problems as governor they tell me that I've used up my time I shouldn't have looked that way there's a lady there I can't say no to her before you ask the question let me just say that as governor I line item vetoed over 16 billion dollars 943 vetoes in eight years without ever having one of them overridden and that's why you know what that is that's a bill they hang something on a bill that they know you've just almost have to sign and know that if it had to stand on its own that amendment would never get by and the president doesn't have that and I'll just I'm going to take one second and then I'll get your question one second to tell a little about the experience a previous president Jerry Ford and Betty while I was still governor had Nancy and me come down to Palm Springs to dinner when they were out there and the four of us were just sitting there having dinner and Jerry was telling me some of the problems from up here and then I gave an answer on something and he said well yes but you've got line item veto and I said yes I have well he said oh boy I only had that and a quiet voice from across the table Betty said for 25 years you didn't feel that way and I must say he admitted it and said yes but I see things differently now well please and then I will I'll quit this has to be the last question I love New Hampshire the people have been very kind of me but I'll tell you I have I think I know what you mean I have an answer that I have to give to that I don't think this is the time I I think campaigns are getting longer and longer but I think if you say one thing too early that you won't then you're a lame duck if you say the other way too early then everything you try to do is tagged as being political and that's not good and I've always believed that the people kind of let you know whether you should or not and in making that decision I will remember your response here today