 Ladies and gentlemen, the President of the United States. Well, please be seated. Thank you all, and welcome to the White House. I'm delighted we could have a few moments together today, and I'm anxious to get to your questions. At first, I thought I'd begin by giving you a little report on two stories that have been coming over the wires, and what those of you in the newsroom would call developing stories that will be, I hope, a source of increasing focus and interest. The first issue has to do with the yearly battle of the budget. Now, I know that's not the sort of story that readers turn to first or that always make the evening news, but I mention it because I believe the budget battle will eventually emerge not as a parochial argument, but as a larger issue, and it will be will we return to the days of unrestricted federal spending? Will a specter of high taxes and inflation and even higher trade deficit haunt us once again? As all of you know, the Congress decided a year and a half ago to get uncharacteristically serious about deficit spending, and they adopted the Graham-Rudman Hollings resolution which would gradually shrink the federal deficit, and by 1991, give us and brace yourselves for this, a balanced budget. When Graham-Rudman Hollings was first enacted, there were all sorts of pious declarations from Congress about living up to its yearly deficit targets. However, I have to tell you that that commitment to Graham-Rudman Hollings is rapidly disintegrating. The House continues to pass spending bills, like the Highway Authorizations Bill that I had to veto recently. As I said at the time, I hadn't seen so much lard since I handed out blue ribbons at the Iowa State Fair. Over in the Senate, a legislative procedure was recently adopted that makes it far easier to override the budget deficit and spending limits. Congress is back to doing what comes natural, playing to the special interests and failing to meet its budget responsibilities. If the budget, if the Congress continues on this course, we'll go to the American people and make our case. And as this battle heats up, I think it's going to be increasingly understood that the Congressional budget process itself, with its missed deadlines and its gigantic catch-all spending bills, is fatally flawed. The executive branch must be given new powers to reach into those pork-barrel spending bills and cut out the waste. And that means giving the president what the governors of 43 states have, the line item veto, or better yet, enhanced rescission authority. I've noticed that everywhere I go, in any audience, I've mentioned that line item veto and it gets a strong reaction. Whoever would have thought a few years ago that line item veto would be an applause line. I think the public is increasingly aware of the problem in the Congress and the need to do something about it. And that's why I think you're also going to see increasing support for the balanced budget amendment. Unlike Graham Rudman Hollings, it would make a balanced budget in the 1990s a matter of the Constitution and not just a law. We need that amendment, but there's another twist to the budget problem that you should know about. As I said in what it's called, let's cut defense. As I said in my radio address on Saturday, defense spending is always the first thing to be sacrificed, canceled or delayed. Even while the boondogles sail through untouched. Despite all the progress that we've made in rebuilding our nation's defenses, the Congress now wants to reverse course. For two years in a row, it has cut defense appropriations below previous levels in real terms. The current fiscal year, 1987, but a defense budget is actually 6 percent less than the one Congress itself approved for 1985. But even now, we hear voices saying that the fiscal year 1988 defense budget should be taken even lower. Now, this isn't only irresponsible from the standpoint of our national security. It also goes to the heart of our bargaining credibility with the Soviets. At the very moment when vitally important arms reduction treaties are on the table in Geneva. Some in the Congress want to take on responsibilities that are not theirs. And I refer here to the business of conducting arms negotiations. This is the second point that I wanted to make. Several amendments have been offered in the Congress such as those dealing with nuclear testing and SDI that would undermine our negotiating positions in Geneva and tie my hands in the conduct of a vital part of our foreign policy. Not to mention the fact it would give the Soviets negotiating victories that they can't win at the bargaining table. These trends are dangerous and if they continue will become the focus of a major national debate. I bring all of this to you for a simple reason. The Congress is a large amorphous institution. It can't be held as accountable as an individual can. But those in the Congress have a duty to report to the folks back home on where they stand on these issues. And I think you would agree that no one plays a more vital role than you in asking them about these issues and their stand on them. And with that said, let's make it a dialogue instead of a monologue. All right. This president Bill Sharp from WCIC in Charleston, South Carolina. Mr. President, to those people who might say your presidency and you have been mortally wounded by the Iran contraaffair, how would you answer those people? Well, sometimes before I've used a line from an old Scottish ballad to the effect that, yes, I've been wounded, I'll lie me down and rest a bit and then I'll fight again. There's my W.S.M. radio in Nashville, my general manager says I can't go home unless you move it around. Oh, boy. Please. I'm Ronald Reagan. Before I'm in Nashville, I listened to Radio 650 W.S.M., the 50,000-watt blowtorch of the South. All right. What's that? Well, I thought they were all quiet. Well, the last part was the only place where you started to laugh. I listened to Radio 650 W.S.M., the 50,000-watt blowtorch of the South. Well, it's just like being back at WHO. Incidentally, on that short answer that I gave you on Mortally Wounded, I have to say that I get out around quite a bit in the country and the audiences range from blue-collar workers in a factory as they did just a few days ago to students and their families at a graduation ceremony. And I haven't seen any evidences that I've been mortally wounded, nor do the people seem to be unhappy about what we've been doing here. Let me kind of ... All right. Mr. President, Mr. McFarlane has explained that he briefed dozens of times regarding the activities that were going on regarding contra-age. And that you have ... He said that you were not aware of any of the nuances of the things that were going on. In one of his testimonies, what action have you taken to make sure that your directors, that the NSC will not be involved in implementing such operations? What actions will you take to see those directors as part of that? Well, we have taken actions in that. And I know that Frank Carlucci has made a number of changes there in the NSC. But I think something that's going on in all of these investigations that could also lead to your question is this linking of Iran and contra-age. And it is ... They've seemed to try to portray me as claiming to be uninformed about everything. No, in the Iranian situation in which they representative of their government, not the Homeini, we were not doing business with him at all. We were doing business with people that could have gotten shot if exposed as dealing with us. And they were thinking in terms of what might be a future Iranian government in view of the health of the Homeini and so forth. And they wanted to make a contact to see if we couldn't discuss how we could have better relations. I immediately took them up on that. We've been for months and months. Here's a matter of fact, trying to find ways to bring an end to that brutal war there that's killed a million people so far. And they were the ones that brought up the subject of arms for them to see it, first of all to enhance their stature, but also to prove that they were talking to representatives that could reach up to the top of our government. In return for that, because we had put Iran on the no trade list due to their support of terrorists, our answer to that was, well, they could do something. We told them about we couldn't do business for that reason. They replied that they were opposed also to support of terrorism. Well, we said there's a way to prove it. Maybe you would like to use your influence with the Hezbollah, which has a kind of philosophical relationship with Iran, to get our people back, our hostages. And so this is what happened in that situation. When the news leaked, it was kept covert to protect the lives of those people we were dealing with. When the news leaked and it suddenly burst all over the world, we were very concerned about that. But out of that, for the first time, we learned that we had not been informed, that our representatives somehow there was more money than the 12 million dollars that we received, and that some of that money was deposited in an account that it was reported funneled aid to the countries. Now, this was all new. I am still waiting to find out the final details of where did that extra money come from, who did it belong to, and where did it go. Now, the Iranian situation, or I mean the Contra situation, and I'm going to start calling them freedom fighters. Contra was a term of derogation imposed on them by the Sandinistas. These are people who are fighting for democracy and freedom in their country. And here, there's no question about my being informed. I've known what's going on there. As a matter of fact, for quite a long time now, a matter of years, I have been publicly speaking of the necessity of the American people to support our program of aid to those freedom fighters down there in order to prevent their being established of Soviet beach head here in the Western Hemisphere, in addition to the one we already have in Cuba. And to suggest that I am just finding out or that things are being exposed that I didn't know about, no. Yes, I was kept briefed on that. As a matter of fact, I was very definitely involved in the decisions about support to the freedom fighters. My idea to begin with. But now, yes. President Norr mentioned the WJCT Jacksonville, Florida. It seems to be a subject of discussion this time recently and I'd like to hear from women kind of simple enough whether it be colorizing a great black-and-white class that's been treated like a bent-on debon, a mid-rock scene, a lot of you feel about it. Well, I can understand the artistic argument that people are raised because of an art form that did deal in black-and-white photography and I think now and then when you see some of those golden oldies you're amazed again at the great beauty that could be produced in that. So I can understand their artistic resentment of this change, this artificial coloring of the movies. On the other hand, I can understand the business problems of those who invested the money and who own the films and who know now that there isn't a market for black-and-white. So frankly, I just question whether this is a problem to be settled by government in any way. The gentleman there stood up, no, here. Then I'll move back there. I'm having some trouble remembering that, but then I want to tell you that there were so many things going on and so many reports and some of this was during the time that I was laid up in the hospital and so forth. I don't recall ever anything being suggested in the line of ransom. I do know that we were constantly receiving ideas and exploring ways in which we could try to get our hostages back and I believe this is a definite responsibility of the government and we should do that. But it's possible that what we're talking about was the use of money to pay people and hire individuals who could affect the rescue of our people there and I've never thought of that as ransom. But again, I'm having some trouble just as Bud had some trouble himself with some of the questions that were asked him. There was an awful lot going on and it's awful easy to be a little short of memory. Yes, but I would suggest that never would it be termed ransom because that from the very first, we will not pay a ransom to kidnappers because it's only going to cause more taking of hostages. Mr. President, John Gruett from WXIATV Atlanta. Congressman Ed Jenkins has raised some questions about contributions Taiwan made to the Contra Freedom Fighters Fund. He's raised questions because it was a trade bill pending then that would have been damaging to Taiwan. It was a bill that you later vetoed. Are you concerned about questions this may raise about pressure implied or otherwise on Taiwan to make a contribution to the Contras? Anyone that would tie things like that together, they're just, it's totally dishonest. No, there's never been any such thing. I have known I have not myself directly ever engaged in soliciting from other countries but I know that this wasn't even prohibited by the Boland Amendment. As a matter of fact, it's specified that under the Secretary of State we should encourage such support to the Freedom Fighters in Nicaragua. The opposition, it hasn't been just the Soviet Union whose help has been in the billions, counted in the billions. Other communist countries, Libya, the PLO, all of these we're aware have been providing help and support to the Sandinistas, to that communist government there. And so there was nothing wrong, and I don't see anything wrong with other countries that share our feeling about democracy, even though this is in this hemisphere, would come to the aid of these Freedom Fighters just as we have come to the aid of causes similar to this, not only in the Western Hemisphere but in other countries in Asia and Europe as well, in Africa. And so this, I don't see any tie of that kind at all. And I see nothing wrong also with the joining in by volunteer groups and individuals, citizens here in our own country of helping out in that cause. I'd like to call attention to the fact that in speaking to the British Parliament several years ago, I called attention to the fact that only the communist blocs seemed to be busy in trying to further spread their philosophy to other countries. And I suggested that we of the democracies should have some plans of doing that, and such a thing was organized because we have been the democratic nations of the world together trying to help democracy. Mr. President, I don't mean to contradict your earlier answer to the gentleman's question regarding your feeling of a national pulse, but in the last six months, public opinion surveys have indicated a significant drop in terms of public support of both you and your policies in all frankness and candor service. How would you respond to that, and how do you account for that? Well, our own poster, who I think is the best in the business, has been with us for years, has found that my approval rating stays at 53. It is true that there have been peaks in which it has shot up higher than that, but 53 happens to be the same rating in the sixth year of the presidency of a two-term president, Dwight Eisenhower, had that rating, and it is the only time in the history of ratings that in the sixth year of a two-term presidency has a president had that higher rating. That's the highest. But also I think it's the way the questions are asked. For example, I know a question in a poll that revealed a great majority didn't believe that I had told all the truth to the people, but someone was smart enough to ask a poll of that kind another question. How many of them thought it was all right if they weren't hearing the truth? And a huge majority of that majority that thought I wasn't said they believed there were things that a president shouldn't be forced to tell the people while they were going on. I have been telling the truth. I told the truth when I went before the press and before the leadership of both houses of the Congress when the first hint came that there was more money than the $12 million as I spoke a moment ago. Telling about that, I told everything that I knew in both instances, and I am still waiting as are others to find out some of those answers because I had not been informed of anything or any extra money and so forth. But I also know, too, that a recent question has just been taken by a poster. And a lot depends on how the questions are worded. And this one, speaking of the freedom fighters in Nicaragua, asked would the people, do the people believe, and would they support opposition to the establishment of a Soviet beachhead here in the western hemisphere and 80% said yes, they would advocate support for resistance to such a thing. I'm going to take young ladies' question there and then this, I'm over time now, I guess. Sally Fitz, WSVN in Miami. What priority, with all this going on, what priority are you going to give your battle with Congress to get more funding for the freedom fighters in Nicaragua? Oh, we're going to keep on with that and I'm going to keep on taking my case to the people. I have a philosophy about legislatures. It came to my mind while I was governor and that was that you don't necessarily make them see the light, you make them feel the heat. So if it's necessary to go to the people and tell the people what our purpose is and win their support, then I still recall a speaker of one house of the state legislature in California coming into my office on the subject of welfare reform one day. It's one of my happiest memories in public life. He walked in with both hands above his head and he said stop those cards and letters. Well, anyway, thank you all very much. I'm sorry we can't go on and I always regret the hands that were up and that I couldn't get to. Thank you all, God bless you. Okay, ladies and gentlemen, I just want to say thank you.