Anti-Inflation Program Remarks at a White House Briefing lot Civic Leaders.

Alfred Kahn and I lately go from one meeting to another, each one better than the one before. And I'm very grateful that you all would come here, literally from all over our country, to meet with me and others in reconfirming our commitment to a common and very important goal.

Other than maintaining the security of our Nation, I don't anticipate having any greater responsibility next year and in the months preceding that than to control inflation in our country. And I think in many ways, our success in this effort will directly affect the security of our country.

We have taken some first steps in some areas, some bold steps in other areas, made some commitments which I intend to keep—some of those under my direct influence, some where I need many partners to guarantee success. This effort is not going to be easy. It has eluded success for many years under all kinds of political leadership, under many different philosophies expressed in economics. And I'm determined not to fail, with your help.

We've had now too high an inflation rate for the last 10 years or more. In the last part of 1977 we had remarkable success, which is possibly a statistical aberration or because of a confluence of beneficial factors that came during that 6-month period. But the general thrust, the general tenor of our economic system has been with too high a rate of inflation.

I'm now preparing the 1980 fiscal year budget. I haven't had a pleasant session yet. [Laughter] And I haven't even met with my agency leaders, nor Cabinet members. I've been meeting with my own staff and the directors of the Office of Management and Budget.

The choices that I have to make are very narrow in their scope, very difficult, and every day's session demonstrates vividly that some very benevolent and needy special interest group or some powerful political force is not going to be pleased with the budget decisions that I am already making in a tentative form. I think, however, that each one of those interest groups, no matter how diverse they might be in character, will be benefited by controlling inflation more than they would with a few million dollars' or hundreds of millions of dollars' extra allocation in the 1980 fiscal year budget.

We've already made some progress. In 1975 the Federal deficit was 4 1/2 percent of our gross national product. In 1980, calendar year, the Federal deficit will be 1 percent of our gross national product. And the progress that we are making is steady. It's tenacious. It's a deep commitment. We have decided to hold down Federal Government employment. I think we've had good response from the administrators of our Government.

I met with about 1,200 of the key leaders in the Federal Government this week to let them realize that when we have limited dollars, limited personnel, we have to make each dollar and each person and their influence be more effective. You can't educate a child with waste, with corruption, nor inefficiency. You can't feed a hungry person with waste, corruption, or inefficiency. You can't build a highway or guarantee housing construction with waste, corruption, or inefficiency.

We have a new Inspectors General bill which will continue our struggle against illegalities, improprieties, and corruption in government. This has not been a pleasant nor an easy task. Some of our efforts have been highly publicized—in the General Services Administration, Small Business Administration, and others. But we are eagerly moving now, not only to detect and reveal and to punish those who are violating proprieties of administration but also to stop illegal practices in their tracks and to make sure that every administrator, no matter how subordinate he or she might be, is equally as dedicated as the President or the administrator of a major agency or the Attorney General.

The prevention of corruption and waste is much more effective a way to address it than to let it happen and then punish those who were guilty.

We have now a good basis for an energy policy. We're trying to cut down present and future imports of oil. I think you will see a substantial improvement in 1979 of our balance-of-trade deficit. We are laying the groundwork for even greater success in the future.

We've got an excellent interrelationship with our major trading partners. Our growth rate will be sustained at a moderate level, not as high as it has been in the last few years, but on the same basis, roughly, as our major trading allies, who have had a much slower growth rate in the past.

We have had to address much more closely the proprieties of government and also the priorities of government, what our obligations are, what is proper and decent and fair on the one hand, and in addressing limited resources for the benefit of all to make sure that we put the emphasis on those that are most important.

We've had superb response from the business leaders of our country. I think labor leaders in general have held back with more understandable reticence. They need to be sure that I, as President, and my administration, the Congress, and the business leaders on price standards, will be forthcoming and cooperative before labor can make a long-term 2- , 3-year contractual commitment on the income of their own members. I understand this. We anticipated this. It's not a very serious problem for us. And the first responsibility is on my shoulders.

Each one of you in this room is a leader. Your voice is heard, your influence is felt, your actions are observed by either dozens of other leaders or by hundreds or perhaps even thousands of other leaders.

As you understand from my own key staff members, including Alfred Kahn, what our purposes are, what the bounds are of our activities, what our limitations are, what our problems are, I hope that you will leave here not just having acquiesced in a dormant fashion in complying with our requests and our standards, but leave here as one who is fervently committed to making this program succeed. Use the same degree of enthusiasm, innovation, and leadership in carrying our country toward a more stable and effective and prosperous future as you do in your own particular responsibilities in a business or profession or even your own family life. It would be a serious waste of your time to come here and only be convinced to go home and keep that conviction to yourself. But there is no one here who doesn't have at least a hundred or two hundred or a thousand people perhaps that look to you for guidance and for leadership and who at least share with you the responsibilities of an exalted place in the free enterprise system of our country.

And I hope that you will take the time to compose a personal letter or to make a list of those that you might call on the phone or to take an opportunity to speak to a civic group or professional group on your own initiative and outline the problems that I face as President with limited legal and constitutional authority and how a partnership must be formed to make the anti-inflation fight successful.

I don't intend to fail in this effort. I think in the past I have not been able to address many of the problems adequately. A year and a half ago, as I traveled around the Nation, as pollsters conducted opinion polls, the number one issue was unemployment. Now there's an overwhelming concern about inflation. One of the reasons, obviously, is that we have made great progress in eliminating unemployment or reducing it. We've added almost 7 million net new jobs. We've cut the unemployment rate down now well below 6 percent. I hope we can hold it at that level.

But inflation is the burning issue in the minds of the American people. It is the burning political issue in the country. And I don't have to convince a Congress, all of whose Members have just experienced an election process, that the American people are genuinely concerned about management, efficiency, waste, corruption, inflation, deficits. The Congress is convinced about that.

And I hope that I can avoid any vetoes next year by assuring that as the Congress considers the evolution of legislation, as they consider the evolution of a budget for 1980, they will be partners with me in the fullest sense in holding down inflation.

I might repeat one of the first comments I made, in closing, and that is that I never want to cheat those in our country who are most in need. The responsibility for meeting their needs is an everpresent burden on any President. And I am convinced as well that the ones who suffer most from uncontrolled or excessive inflation are those who are most vulnerable.

Almost everyone in this room has educational and professional and economic advantages, which gives you some flexibility in your choices for a life's work or alternatives for a life's income. But those who are relatively illiterate or uneducated, who are not mobile because of family or other constraints, those who have finished their productive life's earning work and now live on fixed incomes, those are the very ones who are most vulnerable to inflation and who need protection most. And I think the combination of controlling inflation and meeting the legitimate needs of our people, although not an easy task to resolve, that task is certainly feasible.

In closing, I want to thank you for being here. I have a great confidence in our country. What gives me that confidence is its innate strength. And although all of us are legitimately and properly concerned with transient needs and transient questions and transient challenges, there's an underlying strength in the United States of America that gives us all encouragement and all resolve for the future.

Militarily, we're the greatest, strongest nation on Earth. Politically, we're the greatest nation on Earth. Our system of economics, based on the individuality of human beings and an innate freedom and competition, is the greatest, I think, on Earth. And we have productivity, in spite of a slow rate of growth in productivity, that is tremendous. Natural resources, we are blessed in every possible way.

So, that underlying strength of our country and its people gives us courage to know that victory is available to us if we only do our part. I'll do my part, and I know that I can depend on you to help me. We are partners in this effort. And I don't intend to fail, with your help.

Thank you very much.