Remarks at a Briefing on the Budget in Concord, New Hampshire

I am extremely grateful for the fine turnout. I look forward to an opportunity to say a few words and then respond to your questions concerning the budget and its relationship not only to New Hampshire but to the country as a whole.

I brought with me a copy of the Federal budget for fiscal year 1977. In the preparation of a document of this magnitude, we have to make certain forecasts: the status of the economy, gross national product, all of the factors that go into anticipated revenues, and what we think are wise decisions as to expenditures.

We had some good news yesterday that could have a very beneficial impact on the budget. The Department of Labor announced that the unemployment figures for the month of January went from 8.3 down to 7.8, a half a percentage point reduction in 1 month, the largest reduction in unemployment percentage since 1959.

We also had in that release from the Department of Labor an indication that in that 1-month period there were 800,000 more people gainfully employed, so that it indicates that since March, at the bottom of the recession, through January, some 2,100,000 more people had been gainfully employed.

Actually, we have regained 96 percent of the job losses that took place during the depths of the recession. Now, that is not good enough--7.8 is still too high, but it certainly is on target, if not better than what we anticipated in the process of putting together this budget.

Now let me give you several very broad guidelines that we used in the preparation of the budget. I believe very strongly that we have to get a new balance in the Federal budget between the people who were the beneficiaries of some of the benefits and the taxpayers as a whole.

I believe that we also have to develop a new relationship between the Federal Government on the one hand and States and local communities on the other. This balance is vitally important if the Federal system that we believe in is to continue and grow, not only in strength but in services and the delivery of services in the best way.

The program that I think in the budget you are mostly interested in would be general revenue sharing. Under general revenue sharing, which went into effect in 1972, the total number of States and local units of government that have been beneficiaries--39,000--some $23 billion has been transferred from the Federal Treasury to States and local units of government. By the end of this calendar year, almost $30 billion in Federal funds will have gone to States and local units, with virtually no strings attached whatsoever.

In the State of New Hampshire, as of this date, Federal revenue sharing has totaled $75 million plus, and by the end of this calendar year, some $96 million will have been paid to the State, to 10 counties, to 13 cities, and to 221 townships.

Now, the program that I have recommended and recommended in 1975 is for the extension of the existing program, which expires on December 31. I have recommended a 5 3/4-year extension that involves almost $40 billion, approximately a billion dollars more over the 5-year span than under the present program.

We have added roughly $175 million a year as a growth factor. I think this is a sound program. And if some of the charts would be opened up here--this chart shows the figure of $75 million as of this date. It shows the distribution: State government, $25 million; counties, $6.6 million; municipalities, $23.7 million; and townships, $19.9 million.

Here is the distribution for the total of $96 million which will be paid or will have been paid at the end of the present legislation on December 31. And this is the figure for the program that I recommended last year to follow on to the present program, which expires on December 31.

You see it is a growth factor that I described a minute ago.

Now, here are some of the individual payments that have been made to a sample of townships, counties, cities. It also shows what would be expected with the new program that I have recommended.

Now, the thrust of this program--and this is the important point--this is Federal money that goes to States, cities, counties with no strings attached. And it shows here the kind of distribution, and it covers in the utilization, education, public works, community programs, hospitals, et cetera.

Now the interesting part about this program: We hear a great deal of complaint about the overhead. This year there will be approximately $6 billion distributed. Less than 100 Federal employees take care of it at a total cost of one-twelfth of 1 percent for the whole distribution of the Federal money. Actually, for less than $3 million, $6 billion goes back to the State, to the county, and to the cities. I think that is a pretty good record of efficiency. And you in your respective areas have virtually total jurisdiction on how you spend the money for your constituents.

I think this is a good program. I urge you to help us get the Congress to move, because the new program of 5 3/4 years of almost $40 million has to be extended.

I was talking to some mayors from the State of Ohio last week. They, under their State law, have to present their budgets or prepare their budgets by July 1. And if this law isn't extended shortly, every mayor in the State of Ohio will either have to provide more taxes to pay for services that have come from Federal revenue sharing or they will have to drop the services because they can't in Ohio, as I understand it, operate their cities in a deficit.

So, it is vitally important that we get this larger and longer program enacted into law so that you can budget in your respective communities and your State.

We appreciate any help you can give. It will be very beneficial, I think, for a good program.

Now, with those general remarks, I will be glad to answer any questions.

Q. Mr. Ford, I went to Virginia Seminary. My daughter went to Virginia Seminary and graduated last year. John Harper¹ studied under me in New Hampshire when I was director of the Episcopal Church. Nice to have you.

THE PRESIDENT. We lived for a few years in Alexandria, about a half mile from there and used to go to church services up at Immanud-On-The-Hill. You are familiar with it?

Q. That's where my daughter graduated and where I graduated. It's nice to have you in New Hampshire, and please remember me to John Harper when you see him.

THE PRESIDENT. I sure will.

Q. I don't want to talk rough, tough, and commercial, but I remind you, scriptures which you will hear in the Presbyterian Church talk more about money than anything else. [Laughter]

Now in New Hampshire, we live on sin. And we preachers, of course, are against it. For example, we have horses, we've got puppy dogs, we have lottery, and we have cigarettes, but our biggest source of tax revenue in the State of New Hampshire comes from the sale of beveraged alcohol.

Now, we as Episcopalians, think it's perfectly all right to take a drink, and we think this is one of God's great gifts, but there are some of us, Mr. President, like myself, who are alcoholics. And we are very much concerned about your budget.

I was down last week. I had my button with me when I appeared before Mr. Kennedy.² I made somewhat of a hit with some of those Democrats down there before the Senate, so I am with you.

But my problem is that your budget, which you submitted this week, cuts the alcoholism research money by $2 million; it cuts your training money by 300 percent--that is, money for kids and for training. It also is going to cut out 50 percent of your treatment money if the block grants go through.

Now, Mr. President, we can't afford to see this happen, and how can we make a believer out of you?

THE PRESIDENT. Let me indicate that under the block grant health program, we have recommended $10 billion for 15 categorical programs. This is as much money as is available for the 15 programs in the current fiscal year. What we have proposed is to take those 15 categorical grant programs, give you the same or slightly more money, and let each State decide how it wants to spend its share of that $10 billion.

Now, if in the State of New Hampshire they want to take its proportionate share of that $10 billion and put its money on the programs you have described, the State of New Hampshire could do it.

We have not cut back the dollars in the health categorical programs. We have simply said, eliminate the categorical grant programs, take the same amount of money or slightly more, and then each State can decide whether they want to put more or less money in any one of the 15 categorical areas.

There is no less money. In fact, we have promised that in fiscal year '78 we would add a half a billion dollars, in fiscal year '79 we would add another half a billion dollars, so there is a hold-harmless provision. But we think the State of New Hampshire is better qualified to make its decision on how it wants to distribute its share of the health block grant program. And I am sure with your persuasion you and your associates in this program would be very fortunate to get at least what you have gotten in the past and possibly more.

Q. Mr. President, I am Martin Gross. I am mayor of the city of Concord. I very much appreciate your comments in connection with general revenue sharing. It is a very, very important program for us here in this city. And your endorsement of its continuation is very much appreciated.

I think, frankly, you are speaking to the converted in this room about general revenue sharing. The question I have for you, sir, is where is the opposition coming from? This program makes so much sense it's almost like endorsing motherhood to say you are for general revenue sharing. But where is the opposition coming from, and how can we help combat it?

THE PRESIDENT. I can't imagine any really legitimate opposition. But bear in mind that I, in a message to the Congress last summer, recommended its extension. I thought there would be no problem. It has so much merit. But here it is January, or February now, and there hasn't been a bill reported out of either a committee or a subcommittee for its extension.

I can tell you where the opposition comes from. It is the same group, primarily, that didn't want it in the first place in 1972. There are those who like to build their own little fiefdom so that they can take credit for this program, and the net result is it's a terrible maze. But it gives to individuals or groups that have a particular interest in a certain program almost total control and jurisdiction. They want expanded categorical grant programs. They want the decisionmaking made in Washington, not in Concord.

Now, that is one group. They just want their own hand in the decisionmaking process.

The other group is an element that doesn't believe in the concept, period. They just don't think you should take Federal money and send it back to the States without any control or strings.

I think this is a very honest opinion, but I believe that the Federal tax system is more equitable than most State tax systems and that this is a way, under a well-agreed-to formula, to get the money back so you in Concord and others can make your own decision.

I have been talking with the Governors, with the county officials, and with municipal officials, trying to get them to get moving to put pressure on the Congress to get the program through.

I have asked the Vice President to take charge of that effort. And you are going to see some activity, and I think we will get it through. I don't know what your budget situation is in Concord, but if they took away that money from your budget in Concord, you would either have to raise taxes or discontinue services or programs.

And, therefore, we have to get a tremendous groundswell of public interest. And I am going to do this in New Hampshire, and we will do it elsewhere, just so the public understands what will happen in Concord and elsewhere if this program isn't extended.

Q. Mr. President, I am Rob Trowbridge. I am the chairman of the senate finance committee here in the State, and I am interested in your remarks on general revenue sharing in that, as in that capacity, I have prepared for the last 4 years--and I think most selectmen here know it--a report of where revenue sharing was spent in New Hampshire, county by county, town by town.

It is very interesting, Mr. President, that one of the big areas that the towns of New Hampshire use this money for is for general hardware rather than software, if you want to distinguish. You know, it is trucks and it is plows and it is things like that which they have difficulty with.

One of the problems with revenue sharing now--and I think this news conference goes both ways, for you to get our views as well as for us to get yours-is that there is a limitation that you have to spend the money within 2 years.

Many, many towns in New Hampshire would love to be able to put this money into capital reserve, building up to buy the plow or the truck or whatever comes down the road. And I think that when you say there are no restrictions on general revenue sharing, you might have someone look back again, because there are more restrictions than you might believe.

Frankly, I think you could be a big help not only to us but to every other State if general revenue sharing were exactly what it was meant to be: block grant--if you want to put it into savings, fine; if you want to spend it, fine. It's that kind of thing that I think would help New Hampshire the most.

THE PRESIDENT. I remember the debates on the floor of the House in 1972 when this issue was raised. And the argument on the other side was simply this: that the Federal Government was operating then and is operating today in a deficit. If the Federal Government borrows money to give it to the State or the communities and then those communities put the money in the bank and draw interest on it, makes it a little difficult to justify the program.

Here the Federal Government is borrowing money to give it to communities and States so they can put it in the bank and draw interest. That is the other side of the coin.

The basic concept is that this is for immediate needs, whether it is buying trucks for the fire department, or doing something for the police department, or any one of a number of other programs.

It would seem to me--I know this has happened in some Michigan communities-as long as they know that money is coming, they could plan on a building program. And they could finance it over a period of 2 or 3 years with this money assured as a way of paying their obligations.

Q. I suppose it is the 2-year period that is too short for that kind of planning. I think that is where you don't get the money until after the town meeting. It comes in and you have already missed a year. It is just the way it works out in New Hampshire. It doesn't allow you to do that. And that is why I think that someone ought to look back at that.

THE PRESIDENT. I recommend that you go down and testify before the House Committee on Government Operations, or go over to the Senate Finance Committee, which has jurisdiction in the Senate.

It is a very legitimate, I think, difference of opinion. I just wanted you to know what the other side of the coin is. And I listened to that debate on the floor of the House, and rightly or wrongly, that is the decision the Congress made.

Q. Mr. President, I am Selectman William Morris from the town of Gilford. I just want to let you and Rod Nessen know the skiing is great up there right now. That is Gunstock and Mt. Rowe. [Laughter]

THE PRESIDENT. Well, you know, I really learned to ski up here in New Hampshire, and after I heard about Ron's famous, or infamous, comment, I made the suggestion to him he ought to go up on Tuckerman's and somebody ought to throw him over the side of the mountain. [Laughter]

Q. Well, Mr. President, I am very pleased to hear your revenue sharing views, and I share the opinion of the last speaker regarding the limitations on the funds, the time limit. And I think something should be done about that. Also, I realize one of your problems, that the Congress is a do-nothing Congress as far as I am concerned. And a lot of people that I know, and their idea that if they haven't thought of it first, the idea isn't any good. I think a lot of your ideas are great.

THE PRESIDENT. Thank you.

Q. One of your ideas that you brought up is a fact that we should give more incentives to businesses, small and large. I believe that the incentives could be a tax credit, and I think this could be up to 50 percent for employers who would hire extra persons over and above their normal staff and over their projected growth.

This would be monitored by the IRS, would eliminate bureaucrats--more bureaucrats, and it could be administered very easily. The money would be direct, it would help the business, and it would help employment. This is the name of the game right now, I think.

THE PRESIDENT. We looked into that program, and there is a great deal of merit to it. But in analyzing it in depth, there are more administrative problems than would appear on the surface. It is something that I think we ought to take another look at because there is, in the broad sense, merit because it gets business to keep people on the payrolls rather than putting them on unemployment insurance or welfare. That is the overall approach.

But there are some pretty serious administrative problems. But I decided that rather than go that route to stimulate business and to increase employment, to recommend that there be an added investment tax credit to those companies that would move into high unemployment areas with new plants, to buy new equipment, if they would do it within the next 2 years.

We think time is of the essence. And the legislative proposal is now before the Congress, and it would accelerate the amortization schedule in effect for these companies that would move into high unemployment areas, build a plant, buy equipment, and modernize their productive facility.

We opted for that over the program you-suggested for reasons that we thought were valid. We will continue to study the suggestion you have made. It was a close call.

Q. Thank you, Mr. President. I also think that in doing this, we have to think about the cost to administrate it. That's the big thing. Most of our bureaus that we have--money doesn't get filtered down to the objectives properly, and I think that is what we have to really study.

THE PRESIDENT. I am sure you know we do have a program where the Federal Government subsidizes for a limited period of time a portion of the wages of an employee who is employed who is not qualified at the time he takes the job.

This is a way to permit the employer to hire someone who has very little skill and put him on the job so he earns both from what he gets from his employer as well as from the Government so he can take care of his family. This is another approach, somewhat like the one that you are suggesting. That is, in effect, in a somewhat limited way.

Q. Thank you, Mr. President, and good luck.

THE PRESIDENT. Thank you very much, sir. Yes.

Q. Mr. President, I am Mary Keenan from Portsmouth. Mr. President, under your recommendations under impact aid, our small city stands to lose over a quarter of a million dollars. We have many students whose parents are employed in Federal installations, who live in private housing. I would like to ask you to reconsider the inclusion of item B under your impact aid.

THE PRESIDENT. That is a long-standing area of disagreement. I am sure you are familiar with category A programs where the pupils live on a base. They are imposed on the local school district. We fully funded that program.

Q. Yes, I understand.

THE PRESIDENT. Category B is the one you described. There is a category C which Congress added which I strongly disapprove of, and they have added another one for public housing. And the net result is, in the budget for this fiscal year, there is roughly $800 million or thereabouts. Isn't there, Paul?³

Now, category B, we finally agreed, would be funded at about 70 percent, not in this next year budget, but in the existing budget. The practical problem is, how can you justify people who live in the town but work in the Federal installation and add extra money for the subsidization of the local school system?

Let me give you the grossest example. My wife and our four children lived in Alexandria, Virginia, for 17 or 18 years. Our children went to the public schools in Alexandria. I was a Federal employee. My children were counted as Government employees, and the city of Alexandria got a subsidy for each of our four children. Now, that just doesn't make sense.

Q. Well, Mr. President, we are not getting any taxes from this Federal installation, and if these children's parents were working in private industry, private industry would be paying a tax to our city. So, we justify it that way.

THE PRESIDENT. What Federal--

Q. The Portsmouth Naval Shipyard, which does employ quite a few of the parents of our children.

THE PRESIDENT. All personnel that live on the base are counted in category A.

Q. Yes, I understand that.

THE PRESIDENT. We are not going to close Portsmouth Naval Yard--

Q. Thank God for small favors.

THE PRESIDENT. --under no circumstances. And I am sure you wouldn't want it closed.

Q. Certainly not, but you can't blame me for trying, Mr. President. I am just asking. [Laughter]

THE PRESIDENT. You have almost persuaded me. [Laughter]

If we could get Members of Congress off the dole as far as impact aid is concerned--because they can afford to pay the necessary taxes to Alexandria or to Montgomery County or any of the other county school systems. It is just totally indefensible.

What it amounts to in my case--and I have used this many times because it is accurate--my taxpayers in Grand Rapids, Michigan, are helping to subsidize my school taxes in Alexandria, Virginia, and it doesn't make any sense. And that is the kind of a screwed up system that Congress has imposed under impact aid in many, many cases.

Q. Well, maybe we could compromise with a payment in lieu of taxes, Mr. President. Thank you very much.

Q. Mr. President, I am Charlie Richmond, a selectman from the town of Warner, and I have a problem. [Laughter]

I was noticing in your pretty blue book--in fact I was talking with another selectman from Hooksett, that our budget committee just wouldn't put up with a fancy publication like this. [Laughter] However, I noted happily that highway outlays are rising to $7 billion in 1977 according to your recommendations. Warner is pretty typical--l,800 people, 15 miles of State and Federal highways, 65 miles of town-maintained roads, 21 bridges, 2 of which we had to close last year.

This is my problem: We were notified by the State that we could qualify for rural road assistance and that it could be used as a 70-percent Federal match of our 30 percent for expenditures on the bridge, which we need. We have been lucky to get the Army Reserve to put in a Bailey bridge to hold us for a couple of years until we can get a permanent one up. But we were told, to qualify for the Federal funds we would have to build a $206,000 bridge to span a 47-foot stream.

The town of Andover, about 20 miles up from us, just finished a bridge designed by a registered professional engineer, designed for 20-ton loads, which is really all we need to get a fire truck across, 25 cars a day, a school bus, and a mailman. [Laughter]

What I am asking is, would it not be possible for Federal agencies to take a look at prudence in design and recognize that, doggone it, maybe we could do for $60,000 the job that needs doing. We are not looking for a Lincoln Continental we want to get across the doggoned river. [Laughter]

THE PRESIDENT. Let me ask you, is this a primary, secondary, or interstate highway?

Q. This is a Warner town road, the bridge has been there for over 200 years. This will be the fourth bridge to go in place.

THE PRESIDENT. Well, there is under the Federal program a category--I have forgotten the precise title, but let me give you what I think is a better answer.

Number one, last year I recommended an extension of the Federal aid to highway program, the abolishment of all the categorical grant programs for the Federal aid to highway program except interstate, and I recommended that 1 cent of the Federal gas tax go back to the States.

Now, unfortunately the Congress hasn't approved that. Under that program there would have been a block grant to the State of New Hampshire, which could have had greater control over the utilization of that money so that your State highway authorities, in conjunction with local authorities, could have made that decision for the specifications without having some engineer in Washington, D.C., do it.

I think that makes a lot of sense, but the Congress wouldn't buy it. I can tell you why. They like to keep their fingers on certain specific programs.

In this case, under the existing law, my impression is that I just don't see why a Federal highway engineer should draw the specifications for a town road in Warner. I just don't see by what authority they have that jurisdiction.

But let me tell you this, if you will get me the facts, write them down, give them to me, we will find out.

In all honesty, it doesn't make sense. My program would have avoided it, but we have to deal with realities.

Q. Well, I think the real point in contention is that the funds are going to the State, and the State is setting the specifications and not allowing the town to supply an adequate design by a professional engineer to qualify. This was a State amount that was quoted to us, and we can't get at the money because the State is administering it.

THE PRESIDENT. I respectfully suggest you go to Concord and ask them. [Laughter]

Q. Mr. President, when I married a native and moved to the State some 15 years ago, one of my mother's good southern friends asked her what State New Hampshire was in. [Laughter] Sometimes when I take long looks at information such as the budget packet you have given today, I wonder if many of the people in Washington know what State we are in.

I am particularly interested in the question of mass transportation. I notice in your budget, as stated by the selectman from Warner, there is a huge increase in highway taxes. There is a considerable increase, as a matter of fact, in mass transportation. I notice further, however, that most of that money seems earmarked for the expansion and betterment of the already existing mass transportation systems, particularly from Washington to Boston.

All over northern New England we have an old saying that you can't get there from here. And if you are trying to get anywhere by mass transportation in this State, it certainly is true. We have kids going to college in the western part of the State who can't get home, 90 miles away, without going to Boston to get there.

I wonder how far down the road you see administrations and Congress and the Senates waking up to the fact we need mass transportation in rural areas and trying to appropriate money to encourage cooperative, small, rural, innovative mass transportation systems?

THE PRESIDENT. Let me make one comment. There is no increase in transportation taxes. The Federal gas tax stays at 4 cents a gallon. As I indicated, I recommended it be reduced 1 cent and that 1 cent go to the States.

But anyhow, we have three basic mass transit programs. Under the Federal aid to highway program, a local community, if it wants to take its highway money off of construction for highways, it can make that decision and utilize that money on a local mass transit program.

I think they are doing that in Boston. I know they are doing it in Washington, D.C. I know they are doing it in many, many communities. They don't feel they need more highways. They feel they need more mass transit, so they have that flexibility out of the highway money.

Number two, I signed in late 1974 a new mass transit bill that provided approximately $11.2 billion over a 5-year period. Now that money is earmarked for mass transit exclusively.

If I recall accurately, there is a rural mass transit or transportation aid program. I must admit that it is funded at a far lesser level than metropolitan areas, but there is a program. And I know that some parts of the country are engaged today in rural mass transit programs, if that is the right term. Has the State of New Hampshire applied for any funds for that program?

Q. I don't know at the State level, sir, but on our city level--I am from Portsmouth--it is very hard for us to get the ear, the eye, or the attention of anyone in regional and Federal offices. Maybe it is a matter to be dealt with at the State level.

THE PRESIDENT. In the case of Portsmouth, the city of Portsmouth can take whatever money it gets from the Highway Trust Fund and utilize it for a mass transit program in the city of Portsmouth.

Now, there is another mass transit program that has been on the statute books 6 or 8 years, called UMTA [Urban Mass Transit Administration]--I can't remember what it means, but it is UMTA. [Laughter] It is funded at around $100 million a year, as I recall. Paul, is that--Well, I was too low. It is about $1.8 billion.

Now, that program, again, I think, is probably aimed at the major metropolitan areas. But there is a Federal program for rural transportation demonstration projects and otherwise. And you can go to the regional office. If they don't give you satisfaction, you call Steve McConahey⁴ on the Domestic Council staff on State and local unit relations, and we will find out what the problems are as far as your community is concerned.

Q. Mr. President, I am Patty Blanchette, State representative from New Market. You mentioned the unemployment figures which were released by the Department of Labor yesterday. I know you know what I am going to ask you.

Yesterday morning when those were released, and we all heard that 800,000 more people were gainfully employed, we agreed that it was good news also. But by the end of the day we were also hearing that those figures were inflated, because for the first time the Department had used a new system in calculating those figures. I was wondering if you care to comment on that or if this is indeed true?

THE PRESIDENT. Let me go back just a bit. Under law, periodically, a group of professional economists and statisticians take a look at how the Department of Labor accumulates its data for the purpose of releasing unemployment figures. Late in 1975, this group got together, looked at the existing system for the Department of Labor, and decided that there had to be some improvement in the collection and the analysis of that data.

And on the basis of that professional group making these recommendations, they did revise all of the unemployment figures for 1975. Some of them were higher, some of them were lower, but it was the recommendation of a group of professional economists and statisticians that had nothing to do with politics.

Now, the figure that was given to me, and I believe it is accurate, is the figure of 800,000. And this came from Mr. Shiskin, who is the head of the Bureau of Labor Statistics, and he is a thoroughly reliable, career nonprofessional (nonpartisan) person.

So, I will stick with what they told us. I think it is accurate, and the reason, if there is any variation, is the one I gave, that in a professional way, as required by law, they moved to a new system. But the fundamental facts, I think, are completely accurate.

Q. Mr. President, I am Mike O'Keefe, State representative from Portsmouth. I have become quite concerned in the last year about the plight of some of our older veterans attending college here in New Hampshire and throughout the country. I have been teaching night school for New Hampshire College, and I have several of these people in my government classes.

The reason I am concerned is that many of them, when they got out of the service, got married, started a job, and began to raise their family, and then after several years, decided that they wanted to go to college and increase their education so that they might be able to move up in their profession, or things of this nature. But they are now faced with, actually, an arbitrary cut-off date of May 31, 1976, where they will lose all educational benefits.

And I was wondering, Mr. President, if you might consider supporting legislation similar to what Congressman D'Amours of New Hampshire has put in, I believe it is House Resolution 9428, by which these veterans, as long as they are attending school and are working on a degree, would be able to continue to receive payments up and to the entitlement that they earned when they were in the military service.

THE PRESIDENT. Under existing law, a GI is entitled to receive those benefits for a 10-year period--in other words, he got out of the service and at any time from that date for the next 10 years, he can take GI educational training. I think this is a fairly decent, fair opportunity for a person. And there are many, as a matter of fact, who recommend that it ought to be cut back.

I have listened to the arguments, and I have not heard of any proposal to extend it. But the facts are, at the present time it gives a 10-year period between discharge and when the benefits expire.
How long does the Congressman want to permit it--indefinitely?

Q. No, sir, the situation is that the individual, while in the service, has picked up a certain amount of entitlement for educational benefits, I believe 36 months.

Now, many of these people, as I mentioned before, didn't go to school when they got out of the service. They got married, they raised a family and now later in life want to go to school. And many of them have a year to 2 years left to get their degrees when their entitlement runs out. What the Congressman's bill would do would allow them to continue to receive benefits until they receive their degree as long as they were within their original entitlement.

THE PRESIDENT. Well, the concept that began in World War II was that those that served in World War II in combat and had been deprived of an educational opportunity should be given an opportunity to go back to school. And there was this cutoff first at 8 years, now at 10 years.

I will take a look at it, but we did find, or have found that there were some professional students. [Laughter] And we have to look at the equity across the board, and we will take a look at it. But I am somewhat dubious that it would be extended.

Q. Thank you for your consideration.

Q. Mr. President, my name is Murray Clark. I am a representative to the General Court here in New Hampshire from the town of Lincoln up in the White Mountain region--Sherm Adams'⁵ town--where Loon Mountain and excellent skiing is also available. [Laughter] And I am sure that the State of New Hampshire would be glad to have you up at Cannon Mountain and Franconia Notch.

THE PRESIDENT. I would love to come there some day.

Q. Now to the matter. I would like to know what is your opinion on the millions of illegal aliens now in the U.S. feeding at the public trough and filling jobs that should be available to U.S. citizens?

THE PRESIDENT. We have anywhere from 6 million to 8 million illegal aliens in this country, which is roughly the total amount of unemployment in numbers in this country. It's a very serious matter. And let me tell you what we are trying to do about it.

Number one, we are working very closely in a new program with the Mexican Government. That is one point of entry where there has been this tremendous increase. The cooperation that we are developing with the Mexican Government, I think, will produce some results in stopping the flow on the one. hand.

When I was in Mexico about 18 months ago, I personally talked to President Echeverria about it.

Number two in this budget, this budget I have here, we have recommended additional employees for the Immigration and Naturalization Service so that they can do a better job of finding illegal aliens on the one hand and seeking to get them deported on the other hand.

Now, there is one other thing we are trying to do. I have favored legislation that has passed the House last year, as I recall, that makes it mandatory for an employer to ask whether a prospective employee is an illegal alien. That would be very helpful.

Unfortunately, the Senate has not approved it. But that would make the administration of this program much, much better. So, between better cooperation with Mexico primarily, through more employees to try and find illegal aliens and get them deported, and through prospective legislation, I hope we can make some significant advancements in solving the problem that you are talking about, because it does add to our unemployment, it does add in many major metropolitan communities to the welfare burden.

Those jobs ought to be available to legally--or legal immigrants or, certainly, American citizens. We are working on it as much as we can, because I recognize the difficulty.

Q. Mr. President, John Hoar, Jr. The other day you signed a bill which we have been looking for in this State concerning the railroads. I congratulate you for doing that. This encompasses certain provisions and clarifies certain provisions of the Regional Rail Reorganization Act, which we have been looking for.

We've got a bad situation in this State, being dependent on one railroad basically. That railroad, although it's not part of ConRail, is in a very tenuous condition. We are not unique in the country.

However, my question is, what do you see for the future of railroads and developing of the railroads and encouraging rail traffic, both freight and, I will put in parentheses, "passenger," because that depends a lot on the success of the freight.

THE PRESIDENT. The Congress did pass the bill that I signed last week. I recommended it. It involves $6,200 million. It provides for the rebuilding of roadbeds; it provides for the refinancing and consolidation of the New York Central, Penn Central; it provides for reorganization of the Northeast rail system.

We have an excellent Secretary of Transportation, who I talked to before I signed the bill, and he has promised to move as rapidly as possible to get the bill totally implemented.

I can't give you the precise timetable, but he understands the urgency. And I can assure you that we are going to press very vigorously. The Northeast corridor rail system must be rebuilt, must be vigorously updated with new equipment, running equipment, with roadbeds that permit the traffic to move much more rapidly, improved station facilities, rail freight yards. It is a comprehensive program. It is the first one ever approved in this country.

In addition to that, of course, we do have the Amtrak program, which is primarily--or if not primarily, exclusively aimed at passenger traffic. That program--I think if Congress would not impose on it some of the totally uneconomic lines, we could do a better job.

But we will carry out the law. And that ought to provide in the areas where it is needed and justified improved passenger traffic. The real problem in the freight traffic area is a roadbed that is not sufficiently strong, if that is the right term. In some areas of the country, freight traffic has to go at 5 miles per hour.

Q. Right here in New Hampshire. [Laughter]

THE PRESIDENT. It is uneconomic from the rail point of view, and it's not good service from the point of view of the customer. But this legislation I signed will significantly increase the roadbed improvement operation.

Q. Mr. President, I am Hilda Fleisher, a representative from Manchester. I am on the health and welfare committee, and I am concerned because there is a Federal program that is giving the State a good deal of trouble. This is title 20 of the Social Security Act, which replaces title 4-A of the Social Security Act, and it has to do with supportive services for people who are on welfare or nearly on welfare, low-income people. These are services like day care, transportation for the elderly, Meals on Wheels for the elderly, homemaker services, and so on.

As I understand it, Congress replaced title 4-A with title 20 and there were two purposes, aside from the general purposes of it, and one was that we should be accountable for the funds that are distributed, and the second is that we should broaden the group of people who may be eligible for these supportive services. They are not money payment programs. They are really supportive services.

Now, we have found that the accountability part is enormous. In fact, it is causing so much trouble that we can't expand the base at all. I am concerned as a State representative, because our welfare workers are spending as much as 85 percent of their time on paperwork, 15 percent of their time with clients.

I am concerned because I am associated with a private agency that administers a homemaker service, and I have talked to other people in agencies. Their staffs are spending so much time in the paperwork, in verifying whether someone is eligible.

If a mother comes in and has six children, 20 forms have to be filled in for each one of those children and for herself, and this is absurd.

We find that we are spending an enormous amount of time just doing paperwork, shuffling papers, at the private agency level, at the State level trying to see what happens to those papers. We've got to look at them when they come in.

I just wonder, who is accountable to us for all of this waste of our time?

THE PRESIDENT. The points you have made convinced me that we ought to approach the problem of delivering these services in a different way. And the net result is in one of the four block grant programs that I have recommended, we attack the problem that you are talking about.

Here is what we call a mess chart. [Laughter] What that shows is the 15 health service programs from the Federal Government to the local and State units of government. That shows where the money comes from, who runs it, from the Federal Government at the top and all the crosslines that end up down here with the beneficiary.

The one on the right--no, that is all the same one. We have one here on education, too. But what you are saying is best illustrated by this particular mess chart. You've got 15 categorical grant programs with all the verification, all of the applications, and the net result is you waste half of your time and a good share of your money in paper shuffling.

Now, what we propose to do is to take the money from the Federal Government and give it to the States, and with a pass-through in some cases for local units of government, and let them take the total amount of money and utilize it at the State or the local level as you in New Hampshire decide you ought to spend it. And you--or the people working in the program--are only accountable to the Federal Government in total. You don't have to apply for it except for one application.

Now, we have to get the Congress to go along with this. But it will save you money, it will save you time, and your clients will get much better service and more funding in reality.

So, I recognize the problem you are talking about. We've got to get the Congress to do this. And any help you can give us would be gratefully received.

Q. That sounds very good, but you will still be asking us to be accountable for that money and still want to know that it is going to the right people and for the right services.

THE PRESIDENT. We will give you the money for the social services program on the one hand or the health programs on the other.

Now, we have to have some understanding of where you spend it. We can't give it to the State for either social services or health and then have it go for highways. We do have to have some record-keeping, but you don't have to go through a multiplicity of applications in health--15 programs. You can make one application for a block amount, get the money, and then, at the State and local level, you make the decision. As long as we are convinced that the money is going for the overall purpose, we are not going to come looking over your shoulder and have one investigator for every one of your social workers.

It is just the opposite. Under the present system, it is totally intolerable. Paul O'Neill is the expert here on this program, but isn't the overhead about 15 to 20?--about 10 percent on this program as we look at it. And we can reduce that to what percentage, Paul?

PAUL H. O'NEILL [Deputy Director of the Office of Management and Budget]. We can get rid of 2,300 Federal employees and have about 50 left.

THE PRESIDENT. This is an interesting statistic. If Congress would go along with that, we could get rid of 2,300 Federal employees and have 50 left. So, that shows how many fewer--[laughter]--how many fewer Federal employees would be bothering you.

Q. Nevertheless, we do have some control over how that title 20 money is spent. We make a State plan and we make the decision in the State how the money is to be spent. Nevertheless, one of those 50 people in Washington, or several, would still be saying, prove to us you spent it right.

And what bothers me, Mr. President, is that there are people in Washington who are doing their darnedest to see that we do not spend that money for the services that the Congress wanted.

THE PRESIDENT. Well, I am sure that you will be less harassed with 50 employees than 2,300. [Laughter]

Q. I hope so.

THE PRESIDENT. So, at least we will make headway in that regard. Now, Paul--

DEPUTY DIRECTOR O'NEILL. We are designing the legislation at the President's direction, and we have been working with mayors and Governors and county officials. And in the draft legislation that we now have, we would require that the State do its own planning and that the State do its own auditing and that the responsible people at the State level simply certify to the Federal Government that they have met the intent of the statute. And that would be the end of it.

Q. And we would be hiring those 23,000 [2,300] people. [Laughter]

THE PRESIDENT. Let me tell you how it works with general revenue sharing. In the first year or two the Federal Government did have its own auditing procedures. But I think in most States today, the Treasury Department, the U.S. Treasury Department, has worked out with the respective States their own auditing system.

How many States? There must be 40 or more--have now worked out a system under general revenue sharing so there isn't a Federal investigator coming and checking on how general revenue sharing money is spent. And as Paul O'Neill has indicated, that is the same concept we would hope to have in this area.

Q. Mr. President, my name is Charles Pugster. I am the mayor of the city of Claremont from the other side of the State.

Your interest in skiing seems to elicit comments, and I would be remiss if I didn't bring to your attention a community-based skiing area we have in Claremont called Arrowhead. And its unique position is that the operation of this ski area is volunteer based amongst our citizens.

But coming to the question that I have, the environmental and safety legislation that is prevalent amongst us--I am not concerned with the objectives; I support the objectives of these pieces of legislation. But I am concerned with problems that are arising out of the implementation. And in particular I can go back to our own area and community. Some industries and some businesses, not just industries, the manufacturing people, have had to curtail employees and employment. Others have had to completely cease their operation simply because they were not large enough in capital to support an investment in these areas or they had to so increase the cost of their product that they became noncompetitive.

This meant losses of jobs, losses of local revenue, and a tremendous problem locally. My question is, in terms of trying to assist these small- and medium-sized commercial and manufacturing establishments throughout the whole country, what can the administration do to influence the administration of this legislation to perhaps influence immediate and total tax concessions that would provide immediate capital that they could make at least an investment into this problem area, or influence amendments to the law so that both the environmental and the safety objectives can be met? But would it be fair to these segments of the economy and pose fewer problems to us here in New Hampshire that do not have large, huge corporations that have tremendous resources?

THE PRESIDENT. Let my clarify one thing. You are talking about the Environmental Protection Agency, not about the Occupational Health and Safety organization [Administration]. You are talking about the former, the Environmental Protection Agency?

Q. Yes, we are, and some of the safety implementations are administered with a great deal more of feeling and understanding. This we can say. But still there are areas there that appear to be actually--don't make too much sense when you come right down to it.

THE PRESIDENT. In the case of the EPA, they have, in my opinion, been too inflexible in some of their decisions as to certain standards. I think we have gotten a little different objective. We have a fine person in charge of it, a man named Russell Train. I think there is a realization now, in and out of Government, that we can't make up in a few years for all the environmental evils we perpetrated on the country over a period of a hundred years.

So there is, I think, a little more flexibility on the part of EPA. If you have a specific case, I would recommend that you communicate it to us. I think there is some flexibility, if there is a hardship involving the closing of a plant and the loss of jobs. It depends on the kind of damage to the environment in each case.

On some occasions--we have just had a tragic thing happen down in Virginia. You may have read about it, this kepone, a chemical. For some reasons or another that was not promptly and adequately handled by either the State or the Federal authorities. So, you almost have to handle each case on an individual basis.

Now, as to the tax incentive, there is a provision in the Internal Revenue Code that gives to business a tax write-off up to a certain percentage for the funds they expend in improving their plant and equipment to meet EPA standards.

I know that some small companies that have a bad cash flow have not been able to utilize that, but it is available and I think it is 20 percent, as I recall. But anyhow, there is such a provision, and I think a good many companies I know have used it. But there are some, I am sure, that for economic reasons, can't finance it.

But the concept is good. Whether it can meet every particular plant's problem or not depends on the individual plant.

Q. Part of our problem, Mr. President, is not solely with the existing plant but with our problem of trying to make a turnover of jobs available as we have the ebb and flow of companies moving in and out and trying to attract new industries and new companies, that they come in and are immediately faced with this type of a problem. And this is why I address the administration part of it. And are there things we could do from the administrative part rather than through the channel of amendments, which takes a longer process?

THE PRESIDENT. We will take a look at it. But I do know, as I said a moment ago, there is, I think, a more understanding and flexible attitude today than there was, say 3 years ago.

Q. Mr. President, John McDonald, State representative from Manchester, the home of the Mcintyre ski area. [Laughter]

Mr. President, both of our New Hampshire Senators are actively pursuing legislation which would, in effect, cut one of the links in the marketing chain of the major oil companies wherein they would not be controlling oil from the wellhead to the pump. If such legislation is passed, Mr. President, would you sign this type of legislation or veto it?

THE PRESIDENT. You are talking about the proposals for divestiture?

Q. That is correct.

THE PRESIDENT. Either horizontal or vertical, and there are a number of proposals in the Congress. I think there is one that has been reported by a Senate committee or subcommittee that would provided for divestiture. I have no sympathy for the giant oil companies as such. In fact, we are being blamed because FEA and others are watching them too closely.

But anyhow, I don't think divestiture is the way to solve the problem. It seems to me that a well-managed oil company, big or small, is the best way to solve our energy problem. And to just tear them apart I don't think answers the problem.

We have, as I recall, about 10 to 15 major oil companies. They reaped a financial bonanza a year or so ago. They are having a less desirable year at the present time, but to tear them up, in my opinion, is not the best way to get them to get in and help us solve the energy problem.

So, I am against just the kind of legislation that I think you are talking about.

Q. Mr. President, Representative McLaughlin from Nashua. Would you care to comment on the U.S. Coast Guard's encroachment on the inland waters of the State of New Hampshire? [Laughter]

THE PRESIDENT. I think you are talking about problems involving Lake Winnipesaukee.

Q. Yes, sir.

THE PRESIDENT. And there is another one I cannot pronounce. Well, as I understand the history of this situation, several years ago a highway had to be built across the channel. At that time, it was decided by the Coast Guard that they had to give a permit and they determined that those were Federal waters. Now, I have never been to those lakes, so I can't describe the situation in detail, but the matter has gone personally to the Secretary of Transportation. He has written to the Governor, and he makes two suggestions for the solution.

Number one, there is a possibility of remedying the situation by the State. Instead of putting a State tax on the boats, puts a State tax on the use of ramps on the two lakes. That is one possibility.

The other possibility is for the Congress to pass legislation which is being drafted by the Department of Transportation, which excludes those two lakes from Federal jurisdiction. I am sure the Department of Transportation will be working with your Members of the House as well as the Senate. It seems to me the better way to solve the problem is to get Congress to make an exception in this case.

As I understand the geography, until they put this highway bridge across there, they were never considered navigable waters. But some bureaucrat decided that they had to grant permission under the existing highway legislation, so they granted the permit on the basis they were navigable waters. And once they are navigable waters then the Federal Government has jurisdiction and your State tax is illegal.

I think the better way to do it is one of the two alternatives recommended by Secretary Coleman to get specific legislation, which I believe can be passed without too much trouble, and it would exclude those two lakes from the category of navigable waters. If that is done by the Congress, I will sign the legislation.

Q. Mr. President, I am John Scorpo, selectman from Hudson, and I am happy to hear you are going to continue to try to expand the general revenue sharing, because that has allowed Hudson to obtain very good services without having to increase our tax rate almost 10 percent.

However, when we try to get some assistance to comply with the Water Pollution Control Act, we seem to run into all kinds of restrictions. I noticed in your proposed budget that you are recommending a 60-percent increase in sewage treatment facilities. But then as I read further down the line, you mention there is pending legislation that might reduce the Federal commitment from 333 billion down to 45 billion on a long term basis. I was wondering if you would comment on that.

THE PRESIDENT. Well, Congress 5 years ago, as I recollect, passed an $18 billion program for Federal aid to local units of government for sewage treatment plants. The law expires, I think, next year, if I recall it correctly.

Now, under the present law, you are correct that there will be $6,900 million spent on local water pollution units, which is 60 percent more than last year. And I think it is 90 percent more than 2 years ago.

Now, under the proposed law, we are recommending some changes, and one, for example, we don't think that Federal money should go into a local water treatment plant and participate in a 10-year growth factor.

Under the present law and under the present funding, the Federal Government pays for a 10-year growth factor. The Federal responsibility should be to catch up so that the local community at the present time is able to handle the sewage treatment problem up to the standards at the present time.

Now, the community ought to look down the road at the growth factor, and, when you crank that factor in that I have discussed, it does account for a significant part of the reduction in the funds that we are proposing. And there are some other modifications which we think, in the long run, are proper, now that we are going to be more or less caught up in the local communities around the country. There will still be a lot of money there, but it won't be as much because of the one or two factors that I have described. There will be money there. And we have recommended it, and I think it will be adequate to handle those communities that didn't qualify or didn't apply under the current program.

I can assure you that we believe that a Federal contribution is right, but it has to be tailored to meet the needs at the end of this law, or at the termination of this law, not just the same amount as we have had for the last 4 or 5 years.

Q. Mr. President, Costas S. Tentas, chairman of the New Hampshire State Liquor Commission. I also want to welcome you to New Hampshire. It's nice to see you again.

THE PRESIDENT. Thank you.

Q. And I want to convey to you the best regards of my counterpart in Michigan, Stan Thayer.

THE PRESIDENT. We both have monopolies.

Q. We certainly do.

THE PRESIDENT. It makes a lot of money for Michigan. I don't know about New Hampshire.

Q. More so in New Hampshire. One of the areas of concern to not only New Hampshire but all the sister-controlled States, which are 18--plus 1 county, Montgomery County in Maryland--is the amount of Federal taxes that are tied up in State funds. Our association, which is the National Alcoholic Beverage Control Association, which is based in Washington, has been reviewing and at the present time there is some $115 million tied up in all these 18 controlled States. Specifically for New Hampshire, of our $10 million inventory, we have some $6 million of excise taxes tied up.

We have been looking at it carefully with DISCUS, which is the Distilled Spirits of the United States, that if at some time will the Federal Government look quite favorably to either the deferment of taxes or possibly the return of some of these funds to the individual-controlled States and the open States?

THE PRESIDENT. Let me see if I understand the problem. When your commission or the one in Michigan buys liquor, they have to pay the Federal tax, and you have the inventory on hand until you sell it through your various channels.

Q. Which includes the Federal taxes.

THE PRESIDENT. Right. I wish I could say yes.

Q. I wish you could, too. [Laughter]

THE PRESIDENT. But we would be treating you, your State differently than we would any other wholesaler. And that is what you are, you are a wholesaler. If we treated Michigan and New Hampshire differently as a wholesaler than we treat others, I think we would have a significant number of complaints.

Q. Our proposal would be that all States be treated equally, that the deferment of taxes be made and then a creation of bonded warehouses within each respective State to monitor those taxes that are due the Federal Government.

THE PRESIDENT. You know we need a little money, too, and you are making money. [Laughter] I am sure your organization, you and Stan Thayer, will be talking to my people in the Treasury and others in the Congress, but give us a little breathing space on that, will you? Okay, two more.

Q. Mr. President, my name is Peter Shapiro, and I represent Concord in the General Court and also in the city council. We don't have any ski areas, but there is a great cross-country area in my backyard around the corner, if you want to go.

My concern is--and I think it is the concern of a lot of my friends--that education is the strength and the backbone of the country. My son, at the end of your next term, Mr. President, will be getting ready to go to college. And I am Wondering what plans you have or what programs you propose to present that will allow those people in the middle areas the ability to have their children attend college, and specifically, the private institutions as opposed to the public institutions.

THE PRESIDENT. We have a number of financial aid programs for students. The emphasis is, I must admit, primarily at what we categorize as a needy student, and under the Basic Opportunity Grant programs, BOG's, we recommended in this budget $1,100 million.

We also have several other programs. We have a work program, a work incentive program, so a student on a campus can get employment under the direction of the school or the university. We also have a student loan program, which has helped countless thousands. There are one or two other programs, but those are basically the programs. Then, in addition--and this, I think, is a very fundamental question--in the tax reduction bill that I recommended last year, which the Congress did not accept in toto, I recommended that a better tax break go to the middle-income people, because over the years--I know from being in the Congress--there has been an increasing burden put on the middle-income individual, whether he is blue collar or white collar.

And in the tax reduction proposal that I submitted with the State of the Union, the Economic Report, I reiterated that. That will help, if Congress passes it, the kind of people who are from $9,000 to $25,000 a year. It is a segment of our society that at the Federal level has gotten short shrift compared to others. And I think, fundamentally, in the long run that is the best way to handle and help the problem you are talking about, plus the individual student aid programs I have indicated.

One more.

Q. Mr. President, George Roberts, State representative from Gilmanton. In the Northeast we are particularly concerned about the cost of oil, particularly for home fuel oil, and I understand that under your budget you have a comprehensive program for independence from the foreign nations by 1985.

Could you just briefly state how the State of New Hampshire would be affected by that in that interim, and what is your position on the use of nuclear energy as a fuel substitute?

THE PRESIDENT. Let me answer the last part first. A year ago in January in my State of the Union Message, I laid out the things we had to do in order to get energy independence, and one of them was that we had to build 200 new nuclear power plants in the United States between then and 1985. The unfortunate part is that that program has slowed down for several reasons: One, financing; two, a great many lawsuits filed by environmentalists and others and some concern on the part of people that there was a safety factor.

Now, I strongly believe in a nuclear power program. We have to.

Now, in the meantime, to get over some of these questions that are being raised, I put into the budget--again, this budget--a significant increase in funding to check reliability of these power plants, and there has been some evidence where there have been breakdowns.

Two, safety. With the money that we have recommended here, I think we can improve not only reliability but safety. If that is done, I am convinced that we should move much, much faster in our nuclear power program.

We have a new nuclear regulatory agency that was split off from the Atomic Energy Commission, and that agency is supposed to be working on an accelerated basis to handle the applications and the challenges that come on individual plants.

I do not think that I should speak specifically about any particular matter that is in litigation before the Nuclear Regulatory Commission because I am advised, if I should, that it might be, under the court action, another reason for delaying this Seabrook project down here in your State.

I am strongly for nuclear energy. I think it has to be accelerated. And with the research and development, with the pressure on the NRC, and with the better financing situation, I think we are going to see more movement in nuclear power throughout the country.

Now, overall, again in January of last year I proposed a comprehensive energy program that would get us energy independence or sufficiency by 1985. It included a number of things: One, something to stimulate domestic production. Domestic production of oil and gas in the United States has been going down dramatically since 1972. We are now producing considerably less gas and oil today than we did 3 or 4 years ago. We have to give an incentive for people to go out and drill for gas and drill for oil.

In the meantime, we have to have conservation programs. We have to have programs that permit an easier transfer from oil to coal. We have to provide an incentive for insulation of homes. We have to put pressure on the automotive industry to increase the efficiency of their automobiles. And I am glad to report-it is public knowledge--that in the last 2 years, under this pressure, the automotive industry in the United States has increased their efficiency about 27 percent, and they are selling more cars because of it. They are going to have a good year this year as our economy burgeons.

Now, all of these things put together are aimed at getting us away from dependence on foreign oil. The Congress thus far has passed 4 of the 13 programs I recommended. We hope to get them to do some other things, to free up the Navy petroleum oil in California, which would give us 300,000 barrels a day more. If we can get them to move in the relaxation of some of these tests and these limits that they have imposed by law, we can, I think, move more rapidly.

We got a setback last week. The House of Representatives made a bad mistake, in my opinion, in not deregulating natural gas. It is unbelievable. It lost by 4 votes, or 202 to 196, as I recall. It is just unbelievable. All they are going to do is keep gas in the ground, and we will be buying more foreign oil.

That doesn't make any sense, but that is what they have done temporarily. We hope to find a way out of it. But I am convinced that we have made a little headway, not enough, and I am going to keep pressure on the Congress, because we have to get some of these laws changed, we have to get some new laws.

One final comment. There are some so-called exotic fuels--let me tell you, solar energy, geothermal energy, and even some more exotic than those--'m the research and development fund in this budget, I increased research and development money for solar energy by, I think, 35 percent.

It went from around $85 million a year up to $112 or $115 million in this budget. We are pushing as rapidly as we can on solar energy. We've got a considerable amount of money in here for geothermal energy. We have some for even more exotic fuels. But that is the long term. It is not going to come overnight. But with research and development money of the magnitude I have proposed, we can make significant progress, and we are going to keep after it.

Q. Thank you, Mr. President.

THE PRESIDENT. May I first thank you for being so patient and asking tough, unrehearsed questions. And I have benefited from them, and I hope it has been helpful to you.

I invite you now to go down the corridor, where there will be a reception in the gymnasium, and I would like to meet as many of you as I could personally.

Thank you very much.