Dayton, Ohio Remarks and a Question-and-Answer Session at a Townhall Meeting.

THE PRESIDENT. Senator Metzenbaum, Mayor lira McGee, Congressman Tony Hall, Paula Macllwaine, Treasurer Joe Shump:

It's really an honor for me to be here with you in Miami Valley, Montgomery County, Dayton. I've only been here a few minutes, but I think I can already agree with your city's motto, and it's right on the mark. It's "Great in Dayton." There's no question about that.

Yours is a great city, a dynamic city. It's vibrant and alive with new construction and new ideas and new vigor and a new zest and confidence in the future. It's typical of the life and the attitude of more than 220 million Americans, who are blessed by God with one of the greatest opportunities for freedom and the preservation of life and to guarantee to our children that they'll have even a better life than we've had. Your downtown restoration effort shows that you can be proud not only of what you've done already but what you expect to accomplish in the months and the years ahead.

It's a privilege for me to come here as President to answer your questions and to share your views about our Nation's future. I have no idea at all what the questions will be. But when this session is over about an hour from now, I will have learned a lot about you and your community, and I hope you will have learned a lot about me and the rest of the Nation.

This is a good place for a President to come. You are builders; you are workers; you're people who know how to get a job done. And I'm glad to come to the birthplace of aviation, because it proves down through history that you've known what innovation and technical progress and also courage means—you see a problem, you're not afraid to tackle it head-on, and our country needs that kind of spirit.

CAMPAIGN ISSUES

As you know, we face some historic tests right now. We discussed this in the car on the way here from Air Force One with some of your officials, Mayor McGee and others, about how our Nation has been able and willing to face difficult questions down through the ages, questions and problems much more serious than the ones we face now—a Great Depression, social shock that swept through this Nation when we eliminated racial discrimination, the First World War, the Second World War, Vietnam, Watergate. We've had those tests of our Nation, much more serious than any problem we face today, and when our people were united and understood what the problem was, we've never failed to solve any problem.

And we've kept high the principles and ideals on which our Nation was founded and on which it still rests. We've never abandoned those ideals. And the other thing is that we've come here from all over the world. Our people came here as immigrants, found freedom—for some it took a long time, but never abandoned hope—to worship as we please. And we, in that process, honor each individual person as a precious son or daughter of God.

We've made a lot of progress even against the tremendous test or challenge of the energy crisis. Last year the price of oil went up 190 percent. It rose more in price in 1 year than the price of oil had increased since it was first discovered back in the 1800's. But our country has weathered that shock. And this year we'll produce more American coal than any other year in the history of our Nation. We'll be producing more and using more of the coal from Ohio, even the high-sulphur coal, to develop clean fuels. It'll be used in the years ahead. And I'm determined to see OPEC oil in the future replaced as a major energy source by Ohio coal.

And finally, before I take the first question, let me say that having come through this first 3 1/2 years of my administration, working with Congress to forge a good, sound energy policy, we've laid the groundwork or the foundation or the base for an exciting new technological revolution in this country, when the American working people, men and women, already the most productive workers on Earth, will now have new investments, new tools, new factories, to keep them at the forefront in the years ahead. What our Nation does will provide an example for the rest of the world. And I want to be sure that 10 years from now, 20 years from now, the end of this century, that American workers will be the most productive, the best paid, the most united, the most free, and the most idealistic workers on Earth. That's my goal. With your help, we'll reach that goal together.

And now we have 54 minutes left for questions. I'll take the first one.

QUESTIONS

TAX CREDIT FOR COLLEGE EDUCATION

Q. Hi, Mr. President, welcome to Dayton.

THE PRESIDENT. I feel welcome. Thank you.

Q. My name is Lou Ann Clingman. And I'm a senior at Fernwell High School, and I'm an advanced high school student at Miami University. And my first question for you this afternoon is: I'm entering college full-time next year, and I was wondering if you're going to give the families of college students a tax credit next year?

THE PRESIDENT. I'll be glad to answer. No. [Laughter] But let me explain. Since I've been in office just 3 1/2 years, there have been very few goals that I have accomplished absolutely. One of them is that I wanted to make sure that every young person in our Nation who was mentally able to do college work could get a full college education no matter how poor the family might be. And I can guarantee you, that when you get ready to go to college, no matter what the financial condition of your family might be, you will be financially able to go to college, through grants or loans or work-study programs. There's no reason anymore in this country after the great work that the Congress has done in the last 3 1/2 years for any young person to be deprived of a college education because of economic circumstances.

So, we've done that, it's a great achievement and I think that we'll build on it.

Q. Good afternoon, Mr. President, and happy birthday to you.

THE PRESIDENT. Thank you very much. It was yesterday, but thank you. I heard "Happy Birthday" sung so many times yesterday, I almost turned against it. But then I got home and Amy had practiced on her violin all week, and she surprised me last night by playing "Happy Birthday" on the violin. It sounded beautiful once again. So, thank you very much.

MINORITY EMPLOYMENT PROGRAMS

Q. My name is Howard T. Smith, and I'm a resident of the city of Dayton, Ohio. Before I ask my question, I'd like to say, Mr. President, I attended your Inauguration in January of 1977, and I intend to be present at your Inauguration ceremony in January of 1981.

THE PRESIDENT. Thank you. So far, that's my favorite question. [Laughter]

Q. I've read recently that one of five black families receives public assistance. In addition, black youth are traditionally hardest hit in periods of recession. Mr. President, what new programs are you proposing to help blacks find jobs?

THE PRESIDENT. I might say that four times as many white families receive public assistance as do black families, but you're absolutely right in your basic question that the minority citizens of our country still suffer most from any sort of economic problems that we have—and by minority citizens I'm going to stretch the definition a little bit by including women, because women are still cheated in this country as are the black people as well. For equal work women only get paid 59 cents out of every dollar that men get, and that's black women and white women as well.

But to answer your specific question, we've been able in the last 3 1/2 years, in spite of all these economic shocks that I've described, to make good progress on employment. We've had a net increase of 8 1/2 million jobs. About 400,000 more people are at work in Ohio today than there were in January when you attended that first Inauguration. As a matter of fact, about 1.3 million more black people are at work today than there were in January of 1977. That's not enough, because we still have a lot of people unemployed.

In the last 4 months or so the unemployment rate has not increased. It's been about 7.7, 7.8 percent. We're doing the best we can to get it down. We've tried to channel opportunities for minorities in this country to places outside of government jobs, that the taxpayers have to finance, into permanent jobs in the private free enterprise system. For instance, I've been very eager to see black ownership of some radio and television stations, because in the past, because of discrimination, they've been excluded from that. We've tripled the number of black-owned or -controlled stations in the last 2 years.

I've also been very eager to see that when the Government has local development funds spent for public works or when the Government buys things like file cabinets or uniforms or stationery and so forth, that a certain portion of those expenditures-and you help pay the taxes-go to minority-owned businesses. That's been a very fruitful pursuit, and we've more than tripled the purchases from black-owned companies. And we've had about 15 percent of our total public works channeled into minority-owned businesses, that's helped. Another thing that we're doing now is trying to increase the so-called countercyclical aid to communities where the unemployment rate is high. We have a billion dollar program that I believe the Congress will pass before it adjourns this year.

And the last point I want to make is this. No, I want to make two more points quickly. One is that we've tried to protect as best we could the downtown urban areas which were deteriorating so rapidly 3 or 4 years ago. It's good for the suburbs to build up, that's inevitable, but while they do that, I don't want to see downtown Dayton or downtown Atlanta or downtown Washington, D.C., go down and become a ghetto area. So, we in all of our programs, housing, transportation, we've tried to defend them.

And the last thing is that we have before the Congress now, that I believe will be passed, a $2 billion program for youth employment. This program will tie together for the first time the Labor Department and the Education Department to make sure that when a young person gets out of high school or out of a junior college or out of vocational technical school, that his or her talents are matched with the particular jobs available in that community. We've never done this before. This will be a 50-percent increase in youth employment programs, keeping intact what we've already got. A lot of these jobs will be channeled to minority youth, of course, and this will be a very helpful, additional boon to what we've done already.

So, those are some of the programs very hurriedly that we're working on, many of them already established and very helpful; the record already very good; the future looks much brighter.

Q. Thank you very much.

THE PRESIDENT. Thank you, Howard Smith.

CHEMICAL WARFARE

Q. Mr. President, I'm Harlan Hullinger, and I'd like to know what your current position and future policy is on chemical warfare and whether you intend to make it a part of your defense policy or if you had some intention of stopping funding of the current facility proposal before Congress?

THE PRESIDENT. What we've done, as you know, ever since the First World War, is taken the leadership as a nation in trying to eliminate the threat of chemical warfare from the arsenals or policies of the nations of the world. We have ongoing negotiations with the Soviet Union even now to outlaw chemical warfare. We have indications that they've used chemical warfare against the Afghan people and also that the Vietnamese have used Soviet chemicals against the poor people of Cambodia. We have reserve supplies of some chemicals on hand, because we've got to keep those in order to induce the Soviets to join with us in the elimination of this threat.

The present proposal, which I think is ill-advised by the Congress, is to move immediately toward the production of so-called binary chemicals that can be used against human beings. The binary approach is a good one, in that you have two different chemicals that are not mixed until they're actually used, so that if you were to spill them at some storage place, say, an Air Force base in our country, nobody would be injured. Only it's when you mix them would they be used. And eventually we'll replace our existing limited stockpiles of old-fashioned, already mixed, and very dangerous chemicals with the binary chemicals that are not dangerous until the time of war comes.

So, that's the combination that we'll use to move to a modern small supply of chemicals of a binary nature that are not dangerous in storage, but to continue to work with the Soviet Union and all nations to eliminate the threat of chemical warfare altogether.

Q. Thank you.

THE PRESIDENT. Thank you very much, Harlan.

You can see the breadth of the questions that we get in a townhall meeting. I had no idea I was going to get that question. I'm glad I was familiar with the answer. [Laughter] I've been studying it lately.

FEDERAL ASSISTANCE TO STATES

Q. Good afternoon, President Carter. My name is Gene Hawk, and I live and work here in Dayton, Ohio. For the past 3 years, the State of Ohio has received approximately 75 cents back from the Federal Government for every dollar it pays in Federal taxes. This ratio is about the same for most of Midwestern industrial States, while in the South, the situation is just the opposite. They receive more aid than they pay in. My question is: Why are the tax dollars from Ohio and other industrial States allowed to drain into the South when we have been hit the hardest by the recession?

THE PRESIDENT. That's a good question. I'm afraid your question is going to get more applause than my answer. But let me try to explain it. It's not something new, as you know.

Ever since 1913 when a constitutional amendment was passed authorizing income tax, the policy of our Nation—all Presidents, Democratic and Republican; all Congresses, Democratic and Republican majorities—has been to collect for the Federal revenues money depending upon the wealth or income of an American citizen no matter where that citizen might live.

Rich people pay more taxes than poor people to the Federal Government. In State and local governments that's not necessarily the case, because local governments are primarily financed, in many States, by sales tax, and the poor people pay just as much sales tax on a loaf of bread as a rich person. It's a lot higher percentage of their income, of course.

And then the Congress, through its laws, that have to be signed by a President, send those moneys that are collected from the income tax to communities and to services as they are needed, to defend our Nation through the military-and a lot of the military bases are located in the South; you have an outstanding military base here in Dayton—to build highway systems; to help with education, primarily designed for the more deprived children and the poorer children, just to supplement what the local and State governments can do; to rebuild cities by matching funds, as we are doing with your urban development program; and of course, to pay unemployment compensation when people are temporarily out of work, as is the case with many people here in Dayton. I was in Flint, Michigan, yesterday.

So, the programs that Congress passes to spend money is designed primarily to defend our country; to provide uniform transportation services, say, with the Interstate Highway System; and to meet pockets of need that vary from one community to another, whether they're in the North or South, East or West; and also to meet transient needs until the State and local governments can catch up with a general trend, like controlling pollution or building up an energy program.

I would guess that in the future this policy will continue. If Ohio had a very low income level, then you would pay much less money to the Federal Government than you got back. If you had a lot of poverty and a lot of deprivation in Ohio, you would get a lot more money back than you paid in, because you wouldn't have much income tax, fight? And the poor people would get more welfare payments, more unemployment compensation. So, what has happened in the past is a measurement of the progress and wealth, or income, of the States involved.

I'm from the South, as you know. Georgia's a very progressive State, making a lot of progress, not nearly up to the income level of Ohio yet. But it's equalizing, the trend. And eventually I believe that Ohio will get back about what it pays in.

I might say that just since I've been in office, the average income of a family in Ohio has gone up 36 percent in less than 4 years. You're still making a lot of progress, and your employment in Ohio has gone up 10 percent, in this entire State-as I said earlier, more than 400,000 jobs.

So, to answer your question, I don't think it's going to change, that policy. I don't think it ought to change. But the reason for it is that on the average, Ohio families have a higher level of income, and they pay income tax based on how much they have coming in and the moneys that the Federal Government pays out for social programs go to those that have very low incomes. So far, you have more low-income families on the average in the South, but I believe it's equalizing.

Did I explain it so you could understand it?

Q. Yes, you did.

THE PRESIDENT. You may not like the answer, but that's accurate, I believe.

Thank you very much.

TAX POLICIES

Q. Hi. My name is Amy Bechtel, and I'm a senior at Centerville High School. And I've been studying economics and government a lot, and Ronald Reagan has proposed to cause more tax cuts with particular emphasis on big business. This is, I think, in order to stimulate growth of business and consequently increase employment and put money back into the economy. My question is: Do you feel that this is a productive way to check inflation and help the U.S. economy?

THE PRESIDENT. No, that's one of the worst proposals that I have ever heard of and one of the most inflationary things that's ever been suggested for presentation to the Congress. Let me explain why.

The so-called Reagan-Kemp-Roth proposal is what you're referring to. Only 10 percent of the benefits of that proposal would go to stimulate new investments in business and new tools and the modernization of American production plants. Ninety percent would go to personal income tax reductions, primarily for the rich people. For instance, a family that makes $200,000 a year under Reagan's proposal would get 35 times more tax benefits than a family that makes $20,000 a year. You'd have a heavy channeling of benefits or tax moneys into the pockets of the rich families and very little going to business that would help them invest in new plants and provide more jobs for the American workers.

Business Week, which is a very conservative magazine, has disavowed any support of Reagan's proposal. Former President Ford, a Republican who supports Reagan for President, has said he could not support Reagan's proposal. Those are not exactly biased analysts. I think one of the closest political observers to Reagan is his own Vice-Presidential running mate, George Bush. George Bush said that the Reagan-Kemp-Roth proposal would create inflation rates in this country of over 30 percent, and George Bush said the best way he could think of to describe it was "voodoo economics."

So, it's not just me as a Democrat who thinks this is a ridiculous proposal. It would be extremely damaging to the working families of this country, would deprive them of an opportunity for jobs, and would saddle them with enormous inflationary pressures, and the rich families would benefit tremendously.

We have proposed, on the other hand, that we not have any tax cuts during an election year. I think it's the wrong time for the Congress to consider it, because there's too much politics involved. But our proposal would be very cautious in nature and designed, with 50 percent of the total benefits going to stimulate jobs and to create new investments in the steel industry, the automobile industry, and associated ones like the ones that produce tires, and at this same time we would add some personal reductions, but very few. The only two that amount to anything much is to have an income tax credit beginning next year that would just offset the increase in social security payments to keep the social security system sound. That ought to be done. And the other thing that we are proposing is that we should eliminate the so-called marriage penalty. Now if a husband and wife live together and both work, they have to pay a lot higher income taxes than if a man and woman are living together not being married when they both work, and I don't think that's right to preserving the sanctity of marriage. So, we want to eliminate that marriage penalty. That's one other point.

And I think that's the best brief description I could make of the so-called Reagan-Kemp-Roth proposal.

This same foolish idea was put forward in 1978 in the election when Members of Congress were running for reelection, and before the election time was over almost all the Republican candidates who had earlier endorsed it said, "It's like a millstone around our neck, because once people look at it and see what it does, it's not a politically attractive proposal." Other than that it's okay. [Laughter]

THE MIDDLE EAST

Q. Good afternoon, Mr. President.

THE PRESIDENT. Good afternoon.

Q. My name is Tony Mann, and I'm from Dayton, Ohio. My question is, with the conflict and terrorism continuing in the Middle East, what new measures are the United States now taking or planning to take to bring stability and lasting peace to that area of the world?

THE PRESIDENT. Our security is directly related to stability in the Middle East and particularly to the preservation of the existence and the freedom and, hopefully, the peace of Israel.

One of the most exciting times of my administration so far has been when President Sadat, Prime Minister Begin, and I forged the Camp David accords, followed up by a treaty between Egypt, that's by far the most powerful and influential Arab nation, and her neighbor, Israel. And now, of course, they have normal commerce, the borders are open, the tourists go to and from Israel and Egypt, they have ambassadors in both countries. Instead of confronting each other across barbed wire with machine gun bullets and tanks, they confront each other now with negotiating. This is a very fine development and, I think, helps to stabilize the western part of the Mideast area, that is, the part that borders on the Mediterranean.

The other part of the so-called Mideast—I think you might want to extend it to the Persian Gulf; I won't try to make geographical definitions here—is still a very troubling part of the world. The revolution in Iran has not yet been replaced with a stable, coherent government. The Iranians have had a very difficult time in putting together their own government. They have finally got a parliament elected—they call it a Majles-they've got a speaker of the parliament, they've got a Prime Minister, and a President now, they're putting together a cabinet. And we believe that when they get a government intact that the country might be more stable. But that process has been interrupted, as you know, by the attack on Iran by Iraq.

So far, we have been instrumental in confining that conflict to just those two nations and trying to discourage [encourage]¹ both those countries to sit down and negotiate their differences. We can get along without oil from Iran and Iraq, but we cannot get along without oil, ourselves or the rest of the world, from the rest of the Persian Gulf region. The United Arab Emirates, Kuwait, and Saudi Arabia ship about 12 million barrels of oil every day out of the Straits of Hormuz, and we will use whatever means is required to keep the Straits of Hormuz open.

¹ White House correction.

In the meantime, we want to prevent any further disturbance that might precipitate a Soviet involvement in Iran or Iraq. We use our alliances with France and Australia and Great Britain and other western countries, plus our friendship with Saudi Arabia, with Pakistan, and other Moslem countries, to dampen down any conflict there. In the future we'll continue these policies.

One of the things that we will do after the election is to go ahead with another summit meeting between myself and President Sadat and Prime Minister Begin, to followup on further progress toward a comprehensive Mideast peace.

In the meantime we are working with the King of Jordan, trying to stabilize the situation in Lebanon, hoping that later the Syrians will come into a peaceful relationship with Israel, and a resolution of the Palestinian question, which all three of us want to see done. That's a quick summary of the circumstances in the Mideast Persian Gulf region and what we have in mind for the future.

THE FEDERAL BUDGET

Q. Good afternoon, Mr. President. My name is Steve Schier, and I teach politics at Wittenberg University in Springfield, Ohio. I was surprised to learn this week that you and I have the same birthday. So, I wish you a happy birthday.

THE PRESIDENT. Same to you.

Q. My question is this: The congressional budget process in recent days has gone off the rails. Taxing and spending limits have been deferred for final resolution until after the election. The problem of controlling annual budget spending is compounded by the fact that an estimated 75-80 percent of annual spending is uncontrollable—entitlements, multi-year contracts. Can you promise to discipline Congress to eventually balance the budget, and at what cost to Government programs should the budget be balanced? Finally, could you compare yours and Ronald Reagan's proposals for eventually bringing the budget into balance?

THE PRESIDENT. Yes. I'll be glad to.

You're right in the analysis of what the Congress has done the last few days. But one of the greatest steps forward that I know the Congress has taken in my lifetime has been the development of the budget process—the formation of the Budget Committees and the self-imposed discipline on the Congress that formerly just did not exist. Now the Budget Committees set overall limits of spending, as you know, in different areas of American life, and then the Appropriations Committees, that formerly had unlimited authority, have to comply with those limits. So, it's a very good improvement in responsibility and predictability about the Government process.

The Congress has done a yeoman's job this year, in my judgment, in trying to bring about a balanced budget. It's easy to use "if's"—but if we had 6-percent unemployment in 1982 fiscal year, in this year that started yesterday, 1981 fiscal year, then we would have a balanced budget. What has caused the budget to be unbalanced is the increased unemployment compensations that are being made to workers who are out of jobs, particularly in areas relating to automobiles and a few other industries, but that's the main one. We cannot abandon those workers, and I have asked the Congress to extend unemployment compensation another 13 weeks when their present authorization expires. We have, I think, a good prospect to continue this discipline on spending in the future.

There are two things that will make it hard to carry out the goal that you described, no matter who the President might be: One is my commitment that during the next 5 years, counting the year that just started, we will have a continual, predictable, adequate increase in real-dollar expenditures for defense capability. For the 8 years before I became President, out of 7 of those years we had a decrease in spending for defense under the Republican administration. We've had a steady predictable increase built in that'll continue. And the other thing is that we have a very serious problem with the meeting of needs of the constituent groups because of inflation. Social security, for instance, must be kept sound.

When I was campaigning in 19'76, there was an imminent prospect of a failure or bankruptcy of the social security system. We've put it back on its feet, and it will be kept sound. One of the provisions for social security, though, is as the inflation rate goes up for retired people, their social security payments go up enough to compensate for inflation, because those payments are low enough so they're already very restraining. So, with those built-in guarantees of certain groups of people, like social security recipients, that they can have a stable and predictably good life in the future, and the need for a strong defense, it's not going to be easy to have a balanced budget. That's still my goal, and I believe the Congress shares that goal.

Last March we had a balanced budget committed. We did not anticipate the downturn in the economic situation of the entire world brought about by OPEC price increases and the increase in welfare payments and unemployment compensation payments that go along with it. And of course, when you get more people unemployed and those unemployment compensation payments go up, you also get less income tax being paid by those same people who have formerly paid interest into the Federal revenue chest.

I made the answer awhile ago to Ann Bechtel over here about the Reagan-Kemp-Roth proposal. My total economic proposal, that I outlined so briefly, is anti-inflationary in nature. The replacement of social security payments by tax credits has an anti-inflationary impact. Reagan's proposal is highly inflationary in nature, and if his proposal is put into effect, I see no possible way that the deficits could be less than $100 billion a year by 1985. But I think my proposal is much better designed to meet the needs of our people to have equity in the income tax system, to have discipline on the Congress, and work toward a balanced budget.

FEDERAL SUPPORT FOR EDUCATION

Q. Mr. President, my name is Terence Walton, and I'm a 10th-grade DE student at Patterson Co-op. And I'd first like to bring you greetings from the distributive education department and everyone at Patterson. Now, first of all, if Ronald Reagan were here I'd ask him why he isn't striking like all the rest of the actors, but I'd like to ask you: Do you have any plans for allocating additional funds for vocational education or education in general in the coming years?

THE PRESIDENT. Yes. Just since I've been in office we have done two things basically—three things for education that are very notable. One is, we have created the new Department of Education, because formerly education was buried under health and welfare, and there was no way for a local school board, a teacher or a parent or a Governor who is interested in better education in a community or State to find who in Washington was directly responsible for education. So, now we've got a new Department of Education, a new Secretary of Education, a highly qualified woman, and that's one step in the right direction.

Another one is what I described earlier about the guarantee that any young person who finishes high school without regard to economics can go to college and find a way to finance it. All they've got to do is qualify to do college work.

And the third thing is that we've increased substantially our commitment in Federal money for education. In just this brief first 3 years we've increased Federal money going to education by 73 percent, an enormous increase. At the same time I've been very careful to leave control of the school system at the local level. I don't think the Federal Government ought to get involved in the curriculum or the hiring of teachers or how to handle education as it relates to the student teacher. But we do provide assistance in general for those who live in very poor areas or near a military base, where the taxes are not paid and the students are there, or problems of that kind—on vocational education of all kinds, distributive education would be included. We have had substantial increases, and we will continue that trend upward in the commitment of Federal funds for that need.

One very important connective part is the youth act that I described earlier in answer to one of the questions about minority employment. This $2 billion that we'll put into youth employment will be a 50-percent increase in the next 2 years. It'll provide literally hundreds of thousands of jobs for young people like you at the junior and senior high school level or perhaps a little bit older, who in the past have not been able to get a job.

The good thing about this for taxpayers is that these jobs will not be in government jobs. They'll be in private employment, where a young person can go to work there and for the first few weeks the government will help pay part of the salary until that young person goes through a training program and then can handle the full job himself or herself. And if they need a special remedial course in high school, say, like in mathematics, then they'll get that remedial course at night while they hold a full-time job in a local business opportunity.

So, that will be a tremendous, $2 billion increase above and beyond what we've already done, specifically designed for youth education and employment that would tie directly to the program that you're in.

MILITARY PERSONNEL AND ENLISTMENT

Q. Good afternoon, sir. I'm Major Paul Davis from Wright-Patterson Air Force Base, and I'm a firm believer in a strong and smart military as a deterrent to conflict. In your recent signing of the military pay increases you offered some inducement for the all-volunteer force, and while it is a step, it certainly doesn't go all the way to help us recruit and retain the topnotch people that we need in tomorrow's military. What additional inducements are you going to offer in your next administration to help us?

THE PRESIDENT. We've had several appropriations bills that I have signed since I've been in office, amounting to more than $2 billion in increased pay and benefits for military people. The last one, the so-called Nunn-Warner bill, was just signed recently, and that's the one to which you refer. It primarily increases pay in general. It also provides more housing allowance and also helps with transportation allowance, and, I believe, in addition will help encourage people to reenlist, particularly at the mid-skill level among petty officers who in the past have not done so.

I'm committed to the volunteer military force. The registration for the draft which I supported strongly does not lead to a draft. It's just the registration of young people 18 and 19 years old so that we'll know where they are, and if we do have to mobilize our forces it can be done expeditiously. It'll save us 90 to 100 days. One of the things that we've done in that registration in which about 95 percent of the young people signed up on time, was to have a block on the form that they fill 'out if they want to get more information about a career in the military forces. Fifteen percent of all those who signed up said they would like to get information about a career in the military forces. That will help us with recruitment. That's part of the answer to your question.

Another thing is that we are trying to explore ways now to extend the time that military personnel are assigned to one particular location, to minimize how much time they have to spend going to and from training courses, of schools, and going to a new assignment. I think a more stable assignment of military people will help to let their lives be better and to tie them more closely with the civilian community around them.

I was in the Navy for 11 years, 7 years after I finished at Annapolis, and spent the last part of my life in submarines. A lot of that time was at sea. We have had some very long, extended cruises for some of our ships in the Indian Ocean, as you know, since the hostages were captured by Iran, but in general we're trying also to explore ways where the families of military people, men or women, can be both closer to them, assigned to the same place where the military persons are assigned, and to let that rotation from unpopular or unpleasant foreign stations be more rapid.

That's the combination of a few things that we'll do in the future, and I think there's a general trend upward in the number of women who are volunteering for the military forces. We see a great opportunity there for good careers for women and, of course, only the actual combat roles are excluded for women's service now. And I think this will open up opportunities for Americans that didn't have it before, and this is a very fine chance for me to put in a plug for that.

Thank you very much, Major. I'm glad to talk to you.

Q. Thank you, sir.

REGISTRATION AND THE DRAFT

Q. Good afternoon, Mr. President. My name is Mary Turner, and my home is here in Dayton, Ohio. My question is about the young men 18 and over that are now registered for the draft and are attending college.

THE PRESIDENT. Yes.

Q. I would like to know, if and when the time should come that they would be called to duty to defend this country, how long would they have to attend college, would they be able to finish the year, and when they come back, would they be able to attend college under some kind of education program like the last bill of rights for GI's?

THE PRESIDENT. Mary, let me answer. That's a good question and it's probably on a lot of people's minds.

First of all, there is not going to be any draft imposed anytime in the future. I hope we will never see the reimposition of the draft. The only circumstances under which we could have draft of young people would be if our national security was in danger, that we had to defend ourselves, and even then the Congress would have to pass a new law setting up authorization for young people to be drafted. That's one part of the question. So, you need not worry about some unforeseen threat to our Nation that we're going to have any draft at all. We're going to continue with the volunteer military forces.

Secondly, if we ever do have another draft, I am not in favor of excluding college students. I want them to be drafted along with everybody else, because in the past, quite often the children of the poorer families were the ones that were drafted, and anybody that could scrape up enough money to put their young men in college avoided the draft. I think if we do have another threat to our national security serious enough to have the draft, we will not have a college exclusion, as far as I'm concerned.

And the third thing is that we will continue the GI bill benefits, certainly, if that should ever come to pass. It's not going to come to pass. We won't give college students special privileges. If it should come to pass, then we will certainly have GI privileges and other benefits for veterans as we have had in the past.

INFLATION

Q. Good afternoon, Mr. President. My name is Johnnie Pope, and welcome to Dayton.

THE PRESIDENT. Thank you, Johnnie.

Q. My first question is: Does Federal deficits contribute to inflation? Also, if reelected, what's your long-range plan to combat inflation?

THE PRESIDENT. Fine. Yes, Federal deficits do contribute to inflation. I don't think there's any doubt about it. The Federal deficit size is one of the major factors in the attitude of people. The financial community, the business community, the average family, all of their attitudes are influenced by how big the Federal deficit is.

When I was running for President in 1976, the Federal deficit was 4¼ percent of our gross national product; that is, it was 4¼ percent of everything this Nation produced. Now, we've cut that deficit down to about a third as much of our gross national product, and we're still making progress to bring it down.

Other things are much more inflationary in nature than just the Federal deficit. How much money is available in the community—by the community I mean the whole Nation—is a very serious cause of inflation. If you have a lot of money available floating around for a given amount of bread and clothes and automobiles and refrigerators, then people tend, in effect, to bid against each other and force the price of those products up. One cause of a lot of money floating around is people don't save the money. And Americans need to save more of their money in order to reduce the amount of inflationary pressure there.

Another factor, of course, is the price of goods over which we have no control. The biggest cause of inflation right now has been—the biggest single cause has been the explosion in the price of OPEC oil, where they, as I said earlier, more than doubled the price of oil in 1 year. So, that kind of price forced on us is a very important cause of inflation.

What we've done there and what we'll continue to do in the future is to hold down the Federal deficits, try to encourage people to invest in new plants and new tools, and also to save their money so that it can be loaned to people to buy new houses and so forth, and to cut down our dependence on imported oil.

We've passed now legislation to set up a very good national energy policy—the first time we've ever had one in our history—and we're saving energy and not wasting it anymore and producing more American energy, not only producing more coal than any year in history, but we also have more oil wells and natural gas wells being drilled this year than any year in history. So, as we cut down on the amount of oil we bring into this country, we control inflation. We'll continue that in the future. This day and every day in 1980 we're buying 2 million barrels of oil less than we were the first year I was in office. We're making good progress there.

So, those are the kind of things that we're doing now and in the future to hold down inflation.

Q. Thank you, sir.

THE PRESIDENT. Thank you. Good question.

NATIONAL SECURITY

Q. Good afternoon, Mr. President. I'm Dave Ponitz, and I live in Centerville. Being 13 and being aware of this summer's registration for the draft and its direct effect on me, I wonder if you intend to reinstate the draft or anything similar in the foreseeable future?

THE PRESIDENT. Okay. David, by the time you get to be 18 or 19, I believe that we will still have a nation militarily strong enough and with a philosophy of commitment to peace that will prevent the need for draft. Our country is the strongest on Earth. Militarily, economically, politically, we're the strongest nation on Earth. Our influence is greater than that of any other nation. Our moral and ethical standards, I believe, are unequaled anywhere on Earth. The American people are committed to peace, and I believe that that will continue.

This election will help to shape those attitudes for the future. One of the elements of maintaining peace, in my judgment, is the control of nuclear weapons. Ever since Harry Truman was President back in 1948-1952, every President, Democrats or Republicans—Eisenhower, Nixon, Ford, Johnson, Kennedy—have favored negotiating with the Soviet Union an agreement to have equal nuclear weapon arsenals to limit how many weapons we can both have and, over a period of time, to lower those levels.

We have concluded the SALT II treaty. Ford and Nixon began the negotiations. I concluded them. Yesterday I read an article where Governor Reagan said that we should abandon the SALT II treaty and use a nuclear arms race as a new card to play against the Soviet Union to try to induce them to lower their commitment to nuclear weapons. This is the kind of thought or proposal that is very serious in its consequences. If the American people get the idea, which is mistaken, that a nuclear arms race on our side is going to cause the Soviets to quit building nuclear weapons on their side, they are silly, because we would not let the Soviets build theirs up to a high level and then have us hide in a closet and say, "Okay, go ahead and take over." And there's no way that we or the Soviet Union would negotiate for future arms control, nuclear weapons, if both sides were madly building as many nuclear weapons as the nation could support.

Also, this kind of talk or proposal directly violates the commitments that our Nation has made in the past to our allies around the world and to countries that don't have nuclear weapons. And it's a very serious matter to depart from a national commitment to peace and the control of weapons and propose a departure from that policy.

I believe the American people have sound judgment. And I believe the American people want to see nuclear arms controlled, and I don't believe the American people want to see a nuclear arms race begun by this country that might aggravate an already dangerous situation. And I believe that the American people are going to make the right judgment in 5 weeks that will continue us on the path to nuclear arms control and therefore to peace, and I believe that's what's going to happen. So, I don't think you have to worry.

Q. Mr. President, my name is Harlan Louis, and I go to school at Northmont Junior High.

THE PRESIDENT. What's your first name?

Q. Harlan.

THE PRESIDENT. Harlan. Thank you.

Q. Again, I'd like to wish you a very happy birthday.

THE PRESIDENT. Thank you.

PRESIDENTIAL CANDIDATES

Q. I would like to know—just suppose that you could not or you wouldn't run for President. Who would you rather become President, John Anderson or Ronald Reagan? [Laughter]

THE PRESIDENT. Well, during every townhall meeting I try to pick out one question that I don't answer. [Laughter] I believe the country would prefer a Democratic President, and if I could not run and could not be elected, at this moment my choice would be Fritz Mondale.

You'd make a good news reporter. [Laughter]

Q. Thank you.

THE PRESIDENT. What are you going to do when you finish school?

Q. I'm planning on being an attorney.

THE PRESIDENT. Oh, you'd be a good lawyer. I hope if I ever get into a lawsuit you're not on the other side. [Laughter]

Thank you, Harlan, very much.

VIEWS ON THE PRESIDENCY

Q. My name is Ken Day, and I'm a resident of Dayton, Ohio, and I'm a senior at Northridge High School. My question is: There have been predictions that every 20 years or election years ending in zero, the President dies in office. Are you concerned about this?

THE PRESIDENT. I've seen those predictions. I'm willing to take the chance. I don't say that in a silly way but even if I knew I would die in office if I were a President, I would still run for the office, because I think it's the most exciting and challenging and important position in the free world.

It's the highest elective office in the world; it's the office that's revered by the American people. For anybody in politics, you know, it's the ultimate achievement. The American people have given me an honor that I never dreamed of when I was your age, and I think it would be worth it even if I knew that it would end in some kind of tragedy.

The Presidency is a special job; it's a lonely job. You know, when you're elected President you're the only one that has authority to represent everyone in this Nation. The decisions that come to my desk are the most difficult and complicated that anybody gets. The ones that come to the Oval Office are the ones that can't be solved in your own family or in the city hall or country courthouse or in the Governor's office or State legislature; if they can't solve the questions there they come to me. It's a very serious challenge, but also a very exciting opportunity. Also you have good advisers; I've got an outstanding Cabinet. The Congress and I have had remarkably good cooperation in this first 3 1/2 or so years.

We've been able to keep our Nation at peace. We've been able to keeping it move forward. And I'd like to continue those policies that we've established. It's been a long time since this country had a President who served two full terms. Eisenhower, who was elected in 1952—28 years ago—was the last President who served two terms. And I think it would be beneficial to our Nation to have a President who was experienced, who knew the job, who was dealing with a nation's problems in a period of transition and trial; when the rest of the world was looking to us for leadership, to continue to keep stability and progress moving as we've already established.

So for all those reasons, I'm not afraid. If I knew it was going to happen, I would go ahead and be President and do the best I could till the last day I could.

Q. Thank you.

THE PRESIDENT. One more question.

WHITE-COLLAR UNEMPLOYMENT

Q. Good afternoon, Mr. President. My name is Jeff Pace, and I am a public information officer for DAVEST, the Dayton Volunteer Employment Service Team. The Carter administration has made strides into the reemployment of unemployed Americans who wish to be reemployed. However, the bulk of the administration's energies has seemingly been toward the labor market. My question to you is: What programs are you initiating to reemploy the unemployed white-collar professional?

THE PRESIDENT. It is hard to provide special programs for the white-collar professional because of the lack of concentration of that particular group of employees in a certain location; also, because of the fact that the white-collar profession, most of them, has a fairly high educational level, and is comparatively mobile in that, if a certain class of jobs, say an insurance auditor or a certified public accountant job, should be lost in a certain community, they can find ready employment in a different community.

I don't have any plans to provide a resettlement or a retraining program for those who have lost their jobs specifically in the white-collar, executive, professional level. But in the military there's a very fine opportunity. We're not employing people in the Government service right now; we're trying to cut down on the total number of employees. But I think that there is an opportunity for college training with Federal assistance for those who need to be retrained for a different kind of career. And that college training with loans and grants, work-study programs are available to adults beyond the normal college age if they should require retraining for a different kind of profession.

I haven't answered your question well. It's a difficult question. I've really not thought it through as I should have; I haven't gotten his question before. But I think in our Nation with the employment force growing rapidly that someone who's qualified to do the kind of work you described will not have a permanent disability on a job.

You might be interested in knowing, for instance, that last month alone, even though we've had some problems with unemployment, we added about a half a million jobs—I think 470,000 jobs—in this country, and even in the automobile industry, each week for the last 6 weeks, we've added back about 4,000 automobile workers. So, I think the recession has bottomed out, and although I haven't answered your question adequately for you, with that narrow definition of employee, the prospects in my judgment to minimize the damage from the recession is much less [better] ² than it was a few weeks ago.

Thank you very much.

² White House correction.

Let me add another point. I don't have time for another question, I'm sorry.

I'm really sorry. Let me say this in closing. It's very helpful for me to come here to meet with you in an exciting community where you obviously have been in the forefront of American progress, and you've always been both eager and qualified to meet changing times. In a modern technological world there's no way to avoid change. We wouldn't want to stop change if we could. And every time we've had a shocking change, in most cases we've benefited from it. Our space program has added enormously to the breadth of benefits of American life in medicine, in science, and so forth.

When we changed many years ago from oil [wood]³ to coal and later from coal to oil, American life was benefited with electricity for even rural homes and so forth. Now we are faced with the time of changing away from dependence on imported oil to a dependence on American energy and American ingenuity and American ability to conserve energy of all kinds that can give us an exciting life in the future. The OPEC Arab nations all put together only have about 6 percent of the world's energy reserves—6 percent. The United States by itself has 24 percent of all the energy reserves on Earth, and ours are not just oil and gas—we've got a lot of that—but ours are geothermal supplies and shale oil and coal and tar sands, almost every kind of energy you can imagine.

³ White House correction.

I see in the future an exciting opportunity for Americans to have a better life, a life with families stronger, a life of more leisure and enjoyable time, a life with a higher quality of air and water and land, a life with greater freedom, a life with more equality of opportunity among Americans who are different from one another, a life where discrimination is eliminated, a life of more trust of government in itself, and a closer relationship between the average citizen and the people who are our elected officials. I see an America even stronger in the future than we've been in the past, with more friends around the world like the 1 billion new friends that we've just added recently in the People's Republic of China. And I see America using that strength for the maintenance of peace and the enhancement of human rights among all people on Earth.

This is the kind of future that we face. We don't face a future of which we need to be afraid or which we need to dread; it'll be an enjoyable, exciting, dynamic future. It's typical of what Americans have always demanded, always expected, and always had. And I would believe that my little daughter, Amy, who will be 13 this month and my granddaughter, Sarah, who is almost 2, will have a much better life in the future than I've experienced in my own. And we've already got, just the folks sitting here, the best life in the greatest nation of Earth.

Thank you very much.