Interview With the President Remarks and a Question-and-Answer Session With Editors and News Directors.

THE PRESIDENT I'll have to apologize for interrupting your meeting. [Laughter]

As we've done on many occasions with groups like this, I generally outline, just in a few minutes, what particular responsibilities I have today, as an example, and then spend all the time we have possible answering your questions.

ADMINISTRATION POLICIES

The major emphasis that we are placing on domestic affairs is to control inflation. And on a daily basis almost—even more—I meet with special groups who come here to the White House for briefings about the parameters of our effort, the degree of possibility for success, what role they can play in making our anti-inflation effort successful, and letting them know what I have done in the past and will do concerning budgets, stabilizing of the dollar, reducing the deficit, establishment of priorities in Government spending, administration, rooting out corruption and waste, as well.

Yesterday I sent out, for instance, a very strong. and specific request to the 500 largest business leaders in the Nation. And we are making the same kind of effort with others around the country.

I'm spending a good bit of time each week putting the preliminary decisions down concerning the 1980 fiscal year budget. Following those general discussions with OMB, Office of Management and Budget, then I will meet specifically with the agency heads to go over their appeals, and I'll listen to specific proposals.

We've got a personnel hiring freeze still on. When vacancies occur, they can only fill half the vacancies. That will be maintained until we reach a certain level and then will be modified as I deem it necessary.

In international affairs we are conducting our share of the Mideast negotiations. I met yesterday with Vice President Mubarak from Egypt. After that he met with Defense Minister Weizman of Israel. Weizman has now gone back to Israel, and Mubarak will be going back to Egypt tomorrow. I think this entire process has been much more time-consuming and difficult than I had anticipated, after Camp David had resolved, as Mr. Mubarak said yesterday, 90 percent of all the issues that separate Egypt from Israel.

In a nonpublicized way—not a secret way, but a nonpublicized way—we are continuing our discussions with the Soviet Union on a wide range of subjects, SALT seeing the most important of all.

And we are also engaged in pursuing our own Nation's influence in Rhodesia, in Namibia, trying to bring' about a settlement of the disputes in Nicaragua. We are actively engaged in all of those.

These are some of the kinds of questions that come before me on a daily basis.

I think we've made good success in the last 2 years. The 95th Congress record, I thought, was superb. We have gotten additional good information in the last 24 hours about net farm income going up substantially. The rate of farm exports has been growing regularly. And we've got, I think, in general, a good record there. Unemployment has gone down. We do not anticipate a recession next year. We'll be doing the best we can to have a balanced improvement in the economic situation in our country.

I think it might be best now to answer your questions. And following this, I have a very important meeting with my daughter, Amy, and with Mickey Mouse. [Laughter]

It's Mickey Mouse's 50th birthday, as you may have heard.

QUESTIONS

RESULTS OF THE ELECTION

Q. Mr. President, does the conservative trend in last week's election concern you about your legislative proposals you are planning for the next year?

THE PRESIDENT. I'm not sure that that's an accurate description. The trend is much less noticeable than was originally thought. There were some Senators defeated who were considered to be liberal. But I think, in balance, the Congress attitude has not substantially changed. And as you know, out of 435 Members in the House, only 12 seats shifted toward the Republicans, which was, I'm sure, a disappointment to them.

I think, however, that liberals and conservatives, Democrats and Republicans, got a clear message from the electorate-during the campaign, primarily, not just the results of the campaign—that tight budget constraints are in order, control of inflation is the top priority among poor people and also those who are more affluent, and that waste and corruption in government must be rooted out, and an administrative capability and efficiency has to be demonstrated.

So, I think this has been obvious to us. It was obvious to me when I ran for President in the response of audiences and the kinds of questions that I got. And I emphasized this, as you know, in my own campaign platform commitments. But I think that message has come through loud and clear without regard to the political spectrum placement.

VISIT TO MEXICO

Q. Mr. President, your next visit to Mexico is the oil issue or illegals' entrance on the agenda?

THE PRESIDENT. We have not yet worked out an agenda with President Lopez Portillo. But I don't have any doubt that both those items would be on the agenda, among probably 15 or 20 other things.

Q. Did you hear about the steel wall on the border to stop the illegal entrance into the United States? There is a tremendous protest from Mexican Americans, Spanish leaders.

THE PRESIDENT. You mean the fence that was

Q. Yes.

THE PRESIDENT. Yes, that was a serious mistake. It was something that I never knew about until I read about it in the newspaper. But any sort of fencing device that would injure people is certainly contrary to my own inclinations.

EMPLOYMENT AND TRAINING PROGRAMS

Q. Continuing on the text of the Mexico border, it seems like down through the years, we've been pouring billions and billions and billions of Federal aid through multitudes of governmental programs into the border. It's seeming to do little more than sustain the status quo of poverty. Isn't it about time for some new approaches to ending double-digit unemployment and three generation chains of dependency? In other words, doesn't anybody know that what's being done down there is not working?

THE PRESIDENT. The first state visit I had after I became President was from President Lopez Portillo. And Secretary of State Vance, my own wife, and the Vice President have all visited Mexico already. We are deeply aware of a need for closer working relationships between our country and Mexico in a broad range of things.

Q. I'm not talking about Mexico. I am talking about our situation along the border, those of us who live on the border.

THE PRESIDENT. Yes, well, I didn't understand your question. Perhaps you could rephrase it.

Q. Well, it seems like all the money is going just to maintain the status quo, that is not very profitable.

THE PRESIDENT. What kind of money?

Q. CETA money, this kind of program money, welfare money.

THE PRESIDENT. Well, I think that situation probably can be assessed critically throughout the Nation. All of these programs were designed by Congress and ultimately approved by me or my predecessors, with a genuine attempt to focus the aid and to focus the training in jobs where it's most needed.

As you know, in the CETA program, in particular, the basic decisions are made at the local level of government. When I was Governor, I was personally the chairman of the CETA committee in Georgia. Other Governors didn't do that; some do. But the basic decisions on who gets jobs, who gets training, and what responsibilities are placed on those who receive Federal benefits are made by mayors, by private groups, by benevolent organizations, nonprofit groups, by county officials, and Governors. And the Federal Government responsibility is to assure that the laws are not violated.

We have had, since I've been in office, a massive examination or monitoring of the allocation of CETA funds to make sure that illegalities were rooted out. These have been very embarrassing, as you noticed, to several large municipal administrations throughout the country—I think most of them are Democratic; it hadn't been partisan in nature at all.

But the Congress, in this most recent session, has tightened up greatly on the CETA law, and I think that any abuses that have been obvious in the past will be much less likely in the future. That's always a problem with welfare, any kind of aid or education.

OIL PRICE INCREASE AND INFLATION

Q. Mr. President, what would a 10-percent increase in OPEC prices do to your anti-inflation plans?

THE PRESIDENT. It would not help at all. [Laughter]

Q. How far would it set it back?

THE PRESIDENT. Well, Secretary Blumenthal is now on a trip to visit with some of the leaders among the OPEC nations. I think the best way that we can prevent an excessive increase in price, whatever it might be, is to prove to those nations that there will be a stable dollar-because they get paid in dollars for oil; that our own leadership, mine in this country and ours throughout the world, will be to stabilize the value of all currencies, that is, to hold down inflation; and also that we are shifting as strongly as possible away from an overdependence on imported oil, which means that a limited supply will meet the needs of those who cannot go to other sources of oil, gas, coal, alternate energy sources.

But I think that in the past 2 years, certainly since I've been in office, the OPEC leaders—Saudi Arabia, Iran, and others—have been very responsible. Most of their foreign holdings are tied to either property or bonds, where inflation hurts them substantially with their net monetary resources.

And we'll do all we can, in addition to what I've already done, to hold down inflation and to stabilize the value of the dollar. And we'll convince them that any unwarranted increase in OPEC prices would have a destabilizing effect on inflation, not only in our country but throughout the world.

FARM SET-ASIDE PROGRAMS

Q. Mr. President, a lot of farmers in Iowa, where I'm from, and I think elsewhere were disappointed that you waited as long as you did to announce the feed grain program and were disappointed in its contents. Could you tell us whether you waited specifically until the election was over to make that announcement, and why you decided against a somewhat more generous program that would have had larger set-asides and higher payments?

THE PRESIDENT. No, I didn't wait until after the election. The normal time for me to make that announcement was November 15.

Q. I understood that to be the deadline, sir.

THE PRESIDENT. Well, it was. But last year, I think you know, we made the announcement after Christmas.

There was a need for us to get the November figures on crop production and grain supplies on hand, which came in the day before I made the announcement, which was last week. And those results did influence my decision. I waited until then. Mr. Hjort ¹ came over to meet with me and my advisers, and we set the standards.

¹ Howard W. Hjort, Director, Economics, Policy Analysis and Budget, Department of Agriculture.

I think that what we established as feed grain regulations and the price level is the best one that I can devise. But there is no way to satisfy the needs of everyone or the desires of everyone or the demands of every interest group, even from us farmers, and I am a farmer familiar with the needs.

We do have a very high level of feed grains on hand, but we are trying as hard as we can to increase our exports and to have stabilized prices. And as I'd like to remind you, farm net income has gone up 25 percent. We will probably export $27 billion in farm supplies this year to other countries. I think we've made very good success in the roughly 1 year that we've had a new agricultural program at hand.

I don't have anything about which to apologize on the feed grain program itself nor the date that it was issued. I think it's been issued in adequate time to plan for next spring's planting, which will come probably no earlier in any part of the country than early March. So, the farmers have adequate time to prepare for next year's planting.

ANTI-INFLATION PROGRAM

Q. Mr. President, today NBC and the Associated Press released the results of their latest poll, which is on the economy and inflation. The poll was taken earlier in the week. Relative to the economy, only 13 percent of those questioned said they felt the economy would get better in the next year; 53 percent said they thought it would get worse. On inflation, 58 percent said that would get worse. What does this tell you about your effort in the anti-inflation program and the work that's ahead?

THE PRESIDENT. It proves how necessary it is. You know, the American people are genuinely concerned about the future of the economy; so am I. And it's not only a burning political issue—which is of secondary importance, but an important thing—but it also is important for me, as President, to make sure I have a prosperous and a strong and secure nation that I lead.

There is no doubt that the number one concern of the American people at this point is inflation. A year and a half ago, the number one concern of the American people was unemployment. And the reason that we have shifted that legitimate concern of the American people is because we've had remarkable and unanticipated success in putting people back to work. We've had a net increase, as you know, of about 7 million jobs since the Congress acted early in 1977.

But I share that concern with them. And many economists have even predicted that we're going to have a recession or depression next year. We don't think we will.

But the best way to prevent a recession is to make sure that our anti-inflation program is effective. I'm dedicated to it. I'll do everything I can, within the legal constraints placed on me as President, to succeed in this effort. And I don't think we'll have a recession. And I am not going to impose any mandatory wage and price controls. Between those two parameters, which are not incompatible, I think we will be successful enough so that the genuine concerns of the American people are not realized.

U.S. TRADE BALANCE

Q. Mr. President, one of the factors, of course, in inflation is our balance of payments vis-a-vis foreign governments. Recently, Dr. Peter Krogh, who is the dean of the Foreign Service School at Georgetown University, said in a speech that he was talking to an American businessman who said that he can't compete with the Japanese; they've got two governments working for them—theirs and ours. And by that he meant that our Government was not doing enough to help in our export programs. Do you have anything to add to that or comment upon that?

THE PRESIDENT. No. I think that we will have a substantial reduction in 1979 in our balance-of-trade deficit; some have estimated a 30- or 35-percent reduction. Our adverse trade balance this year is in the neighborhood of $30 billion. The prime cause of it is $45 billion worth of oil imports.

Under Secretary Kreps, the Commerce Secretary, under my own leadership, we and my whole administration has tried to encourage exports of American products. And they have been increasing.

I just mentioned agricultural exports as an example, since it has already been raised. Last year, in 1977, we had a very low average price for agricultural products. But we still set all-time record in export volume in dollars, $24 billion; this year we'll pass $27 billion.

I just signed a new agricultural export bill, while I was in Kansas recently, that will let us make short-term loans for those who'll buy agricultural products. It authorizes the establishment of trade offices in nations that are potential customers, to let them know about the offer, the excellent products that we have to sell.

I think we're doing everything we can within legal bounds to encourage export sales. The final responsibility, however, is on the producers of those products, in a competitive world market, to sell their own goods. And I don't know, the gentleman to whom you refer, but some people say if you put a total barrier against imports, we can have a better chance to sell our exports. That's obviously a fallacious argument. Open trade opportunities are much better for both sides. But in literally dozens of cases every month, I have people, who want to have every possibility to sell their own products, come and ask me to erect trade barriers or tariffs or quotas that would prevent any competition from coming in and challenging them. But Americans benefit greatly from open trade.

And Bob Strauss is now negotiating in Europe for a multilateral trade negotiation agreement, which I think will help. But we're doing all we can to improve exports and to cut down on unnecessary imports, like excessive oil purchases.

WAGE AND PRICE CONTROLS

Q. Mr. President, Senator Nelson of Wisconsin 2 weeks ago suggested that your voluntary wage-price control program would not work and that it be substituted with a mandatory program for the told 400 companies and unions. Why would that not work?

THE PRESIDENT. I don't know of any case where mandatory price and wage controls have ever worked.

I have said that I have no intention of asking the Congress for that authority, which I do not have under the law, nor to impose wage and price controls in a mandatory way—even if I had the authority except in time of national emergency, when I thought the security of our Nation was endangered. And that's a pretty tight constraint, which I don't ever anticipate occurring while I'm in office.

Even if I asked the Congress for mandatory controls, I don't think we could get 10 percent to support it. It's an idle debate. And as long as I'm in the White House, I have no intention of mandatory price and wage controls.

Q. Even on a limited basis?

THE PRESIDENT. No. We are monitoring the prices of those 400 top producers of goods in our country—500, as a matter of fact. And if they should exceed our voluntary price guidelines, we have some fairly effective measures to use to encourage compliance.

We've asked them to restrict their price increases to one-half percent below the increases they've experienced the last 2 years, and we're getting a very good response from the business community in this early stage. It's not apparent yet, because the details of the standards, which are so very complicated, have not yet been completely devised nor promulgated.

But I think mandatory wage and price controls would be ill-advised. I see no prospect of them being imposed in our country.

EMPLOYMENT AND TRAINING PROGRAMS

Q. With the high unemployment among black teenagers in this country, is the administration going to offer any kind of incentive for the private sector to bear some of the costs of on-the-job training oriented programs?

THE PRESIDENT. Yes. We have more than doubled both the public service job possibilities and also the encouragement of private employment, with Government incentives of all kinds—tax breaks, a sharing of costs of hiring new people and training programs on the job—in the private sector.

We've also had good success from the business leaders—the National Association of Businessmen and others—in putting into effect their own voluntary programs, where the Government is only slightly involved.

We've made some progress. I think the reduction of unemployment has made it possible now to focus more and more on the chronically unemployed—those who are most difficult to employ and the first ones to be fired if things go the wrong way. And as you know, the primary group that has not yet been helped is the young group, minorities in particular.

I think that we have not backed off at all from the level, the very high level of Federal job opportunities and encouragement of private job opportunities that we initiated at the beginning of our employment drive 15 or 18 months ago. Even in spite of inflation, that emphasis is still being maintained.

TEXTILE INDUSTRY

Q. I come from a highly textile part of the country, and they're concerned over the textile tariff bill that you vetoed. What was your particular problem with it, your main objection?

THE PRESIDENT. I think it was completely counterproductive as far as helping the textile industry itself. What it did, in effect, was say that in the multilateral trade negotiations, which opens up increased opportunities for trade in textile and all other products, that we could not even discuss or negotiate on the subject of textiles. /tad that bill been signed into law, the entire effort on multilateral trade negotiations would have broken down.

We've had very good response from the labor unions who represent textile workers, because of the veto. And as you know, in certain areas where textiles are involved, we have negotiate¢t bilateral agreements with individual nations to hold down the level of their textile shipments to us.

But I'm deeply concerned. We have about 60, 65,000 textile jobs in Georgia. And I know in South Carolina and North Carolina—and others have a similar, even more greater dependence.

But I just don't think the bill was advisable at all and, in my opinion, would ultimately hurt the textile industry as badly as it would other industries in our country.

MR. WURFEL. Thank you, sir.

THE PRESIDENT. Thank all of you. I would like, if you don't have any objection, to get a photograph with each one of you. [Laughter] That'll take 2 or 3 minutes. But—yes?

CYPRUS NEGOTIATIONS

Q. I'd like to ask you, Mr. President, on the Cyprus issue, do you feel that there has been any progress after lifting the embargo?

THE PRESIDENT. Yes, there has been progress; there has been progress

Q. Can you be more detailed?

THE PRESIDENT. No. I think this is something' that ought to be handled very privately among the leaders involved.

As you know, both in Greece and Turkey, among the Turkish Cypriots and the Greek Cypriots, they really prefer to negotiate with one another without our country being involved directly. And when a third party is required to organize or to enhance the discussions, almost everyone agrees that it ought to be the United Nations, rather than us.

So, although progress has been made, compared to what it was before the embargo was lifted, I'm not at liberty to discuss the status of the negotiations.

If you all would just come by, and we will get a photograph made.

I want to thank you again for being with us. I didn't thank you at the beginning, but it's very helpful to me to have you come to the White House and meet with my own staff and ask me your good questions.