The President's News Conference

THE PRESIDENT. Good afternoon, everybody.

After the last press conference, I had an uneasy feeling that I had not adequately covered the question about energy and some foreign affairs, so I thought we would have another press conference fairly soon after that one.

NATIONAL ENERGY PLAN

About 5 months ago, in April, I spoke with the American people and with the Congress about one of the most pressing national needs--to develop a comprehensive energy policy. The reason that we have to act is not because we have crises or emergencies at this present time, but because they are imminent, and we need to begin preparing now to protect our own economic and our national security wellbeing for the future.

With every passing day, our energy problems become more severe. We have, almost unbelievably, spent $23 billion so far this year on imported oil, and we are likely to spend almost $45 billion before the year is over. This is by far more than we have ever bought before. Gasoline consumption was higher this summer than it has ever been before, and now half of the oil that we use, much of it wastefully, came from foreign countries.

No matter how hard we try to ignore it, our energy problem is not going away. There is no easy way to establish a comprehensive energy policy. No interest group or organization can be totally satisfied with every part of our plan. But the House of Representatives has met this very difficult and controversial issue courageously and has adopted almost all of the program that was proposed to them last April.

This proposal is balanced, fair, and comprehensive, and it contains incentives for adequate production and also protects the interest of consumers.

By relying on incentives rather than prohibitions and regulations, it keeps to a minimum the direct Government involvement that would otherwise be necessary to control our energy problems and which exist at the present time.

Oil producers will receive the equivalent of the world price for newly discovered oil, and between now and 1990 oil and gas profits from domestic exploration and production, under my own program, will exceed $430 billion.

We accept these incentives, knowing that they are necessary to guarantee future supplies of oil and natural gas. What we do not accept is the argument that we hear from the oil and gas companies that we need to provide incentives for wells that were drilled in 1970 or 1972, or even earlier, when oil prices were about onefourth what they are now. We do not accept windfall profits for efforts that the producers have already made and for oil and gas already discovered.

I do not support complete deregulation of natural gas prices, which would provide windfall profits without significantly increasing supply. Deregulation would cost consumers an extra $70 billion by 1985 but would increase supplies very little, if any. Gas prices have already risen by 500 percent over the last 6 years, but we are producing less natural gas than we did in 1972, 6 years ago.

Along with production incentives, the National Energy Plan also contains vital measures to conserve energy and to replace our precious oil and gas with more abundant fuels, such as coal. Let me mention quickly in closing three of the most important of these conservation measures.

Unless we pass the oil equalization tax, we will in effect continue to subsidize, with an extremely complicated Government program, imports of oil. The gas-guzzler tax is crucial because it provides a continuous economic incentive for consumers to buy and automobile makers to produce more efficient automobiles.

The large industrial users of oil and gas must be persuaded to convert to coal and to other fuels. This effort alone could account for about 40 percent of the total oil savings that we project in the energy program.

And, finally, the rate structure for electric power must be modified to discourage waste.

We are now at a turning point in establishing a comprehensive energy program. The House of Representatives has acted. The Senate is still in the process. I'd like to take this opportunity to thank the majority leader and many of the Senate leaders for their work toward resolving the difficult questions that now face the Senate. It's a difficult job, I know, and at times an unpleasant one, but the price of failing to enact a comprehensiveness energy program is just too high for our Nation.

I think the American people are expecting their Government--the Congress and the President--to establish an energy program. And I sincerely hope that the Senate will not let the American people be disappointed.

Thank you very much.

Mr. Cormier [Frank Cormier, Associated Press].

QUESTIONS

SENATE ACTION ON ENERGY

Q. Mr. President, the Senate hasn't obviously completed action, but on the basis of their votes in committee and elsewhere so far, the difference between them and the House is so marked, how do you account for it? :\re they less representative? Are they more susceptible to lobby pressures? How do you figure it?

THE PRESIDENT. Well, first of all, I'd like to point out that no final action has been taken by the Senate. And there were times several weeks ago when we were quite disappointed at the progress that had been made in the House. As the Members of the House of Representatives began to realize the enormity of the consequences of their timid action and as the Speaker and other leaders moved forward to assert their influence, the House acted responsibly after giving us a disappointing time for a few weeks.

I think the Senate is now in that posture. I think the Senate realizes that this is the major domestic legislative product that we expect this year. And for us to devote a full year of work and come out with an inconsequential or inadequate energy program is something that I don't believe the Senate will face. They have their own reputations to protect.

I think they want to act responsibly. And I think that it is obvious, in my own experience in the legislative branch in Georgia, that the focusing of the powerful lobby pressure is always on the second legislative body that has to act, the final body that has to act. So, there is a tremendous pressure on the Members of the Senate now from the lobbyists, many of whom are well-meaning people--I am not criticizing them necessarily- but I think as they hear the voice of the American people, as they realize the consequences of an absence of courageous action, then I think they will move to adopt the major parts of the program.

The last thing I'd like to say is that when the Senate acts, we still have what is in effect a third branch of government to consider and to exert its will, and that's the conference committees. And I think the House is going to be very adamant in maintaining their position. And the likelihood now is that I would be much more inclined to support the House position, which is compatible with my own.

So, we still have a long way to go. I'm not discouraged, but I think my own voice is helpful in encouraging the American people to let the Senators know what their duties are and to encourage them to act objectively. And I'm sure they will.

GENEVA CONFERENCE

Q. Mr. President, there have been a lot of confusing statements from the White House and from leaders who have seen you recently on where exactly the United States stands in terms of Palestinian--PLO participation in a Geneva peace conference, if one comes about. Can you really clarify this point?

THE PRESIDENT. I doubt it-[laughter] but I would be glad to try. What we are trying to do now is--as a first and immediate goal--is to bring all the parties in the Mideast dispute to Geneva for a conference. We are dealing with Israel directly. We are dealing directly with Lebanon, Syria, Jordan, and Egypt. We are trying to act as an intermediary between Israel and each one of those Arab countries that border their own country.

There are some differences among the Arab nations, which we are trying to resolve, concerning a unified Arab delegation or individual Arab delegations and the format which might be used to let the Palestinian views be represented.

At the same time, we have a further complicating factor in that we are joint chairmen of the Geneva conference along with the Soviet Union. So, in the call for the conference, in the negotiations preceding the format of the conference, we have to deal with the Soviet Union as well. So, on top of all that, and perhaps preeminent in my own mind, is that we are not an idle observer or bystander, we are not just an intermediary or mediator. We have a vital national interest in the ultimate peace in the Middle East.

It's obvious to me that there can be no Middle Eastern peace settlement without adequate Palestinian representation. The Arab countries maintain that the PLO is the only legitimate representative of the Palestinian interests. The Israelis say that they won't deal with the Palestinians, or certainly not the well-known PLO members, because they have been identified in the past as committed to the destruction of the nation of Israel.

So, we are trying to get an agreement between the Israelis and the Arab countries, with widely divergent views, about the format of the meeting and, also, who would be welcomed to the conference to represent the Palestinians.

This is something that is still in the negotiating stage, and I cannot predict a final outcome. We have no national position on exactly who would represent the Palestinians or exactly what form the Arab group would take in which the Palestinians would be represented. I just can't answer that question yet because the question has not been answered in my mind.

PALESTINE LIBERATION ORGANIZATION

Q. Does the United States recognize--recognize is the wrong word-but accept the PLO as a representative of the Palestinians?

THE PRESIDENT. We have pledged to the Israelis in the past, and I have confirmed the pledge, that we will not negotiate with, nor deal directly with the PLO until they adopt United Nations Resolution 242 as a basis for their involvement, which includes a recognition of the right of Israel to exist. We have let this be known to the PLO leaders through various intermediaries, through intermediaries through the United Nations, leaders in Saudi Arabia, Syria, Egypt, Jordan, and so forth. They know our position.

If the PLO should go ahead and say, "We endorse U.N. Resolution 242; we don't think it adequately addresses the Palestinian issue because it only refers to refugees and we think we have a further interest in that," that would suit us okay.

We would then begin to meet with and to work with the PLO. Obviously, they don't represent a nation. It is a group that represents, certainly, a substantial part of the Palestinians. I certainly don't think they are the exclusive representatives of the Palestinians. Obviously, there are mayors, for instance, and local officials in the West Bank area who represent Palestinians. They may or may not be members of the PLO. So, we are not trying to define an exact formula that we would prescribe for others. We are trying to find some common ground on which the Israelis and Arabs might get together to meet in Geneva.

I think, by the way, that both the groups, the Arabs and the Israelis, have come a long way. They are genuinely searching for a formula by which they can meet. They want peace. And I think they are to be congratulated already, because in the past number of years they have made very strong and provocative statements against one another, and now, to move toward an accommodation is a difficult thing for them. And we are trying not to make it any more difficult.

Q. Mr. President, what are the assurances given to the PLO in the event of accepting 242?

THE PRESIDENT. If they accept U.N. 242 and the right of Israel to exist, then we will begin discussions with the leaders of the PLO. We are not giving them any further assurance of that because we are not trying to prescribe, as I said, the status of the PLO itself in any Geneva conference. But it would give us a means to understand the special problems of the Palestinians. And as you know, many of the Israeli--some of the Israeli leaders have said that they recognize that the Palestinian question is one of the three major elements. But I can't and have no inclination to give the PLO any assurances other than we will begin to meet with them and to search for some accommodation and some reasonable approach to the Palestinian question if they adopt 242 and recognize publicly the right of Israel to exist.

RELATIONS WITH CONGRESS

Q. Mr. President, this morning a group of Republicans who came over here to meet with you reported that you told them that on certain matters you perhaps worked even more closely with them than the Democratic majority. I wonder if, noting what has been happening to some of your programs in the Congress, that you feel more comfortable with the Republicans now, and what effect do you think those words this morning will have on the eventual outcome of certain energy matters in the Senate which must, of course, receive support from the Democrats?

THE PRESIDENT. Energy was not one of the examples I used. I did point out the almost unanimous approval of the Republicans, for instance, for the AWACS sale to Iran, which I think is important and advisable, and I pointed that one out.

I also pointed out the extreme inadvisability of the Congress trying to put tight controls over our international financial institutions allotments. For instance, the Congress has said, in a very serious mistake, that we could not contribute to the World Bank or to the international regional banks if any of the money was to be used in a country that produced citrus fruits or palm oil or sugar, or if it was to be used for loans to, I think, eight different nations.

This is an unprecedented encroachment on the independence of the World Bank, and it would mean that our contribution to the World Bank could not be made. This is another item where the Republicans see the matter much more clearly, in my opinion, than do some of the Democrats.

But in general, of course, I am a very loyal Democrat. I appreciate what the Democrats have done, but in some areas the Republicans have helped me more.

I would say another example would be the reorganization effort. I think as a matter of philosophy, the moderate-to-conservative Members of the Congress and I see compatibly a need for strict Government reorganization. But this means, certainly, that many Democrats have cooperated just as well.

VICE PRESIDENT'S ROLE

Q. Mr. President, you have been underscoring of late how very important the Vice President--very important role he is playing in your administration. And I was just wondering whether the Vice President has become in actuality as well as in effect your deputy, the deputy President or assistant President?

THE PRESIDENT. I probably meet with the Vice President on a daily basis more than all the other staff members that I have combined. He brings to my own inner circle of advisers an experience in the Congress and in Washington. He, obviously, has a stature, political stature inherent in his office itself. And his wide-ranging interests, that I have welcomed and encouraged, include domestic politics, our relationships with the Congress, domestic matters like tax reform, sensitive civil matters like the Bakke case, international matters like southern Africa or the Middle East. He has a detailed knowledge of the SALT negotiations now and the history of SALT negotiations in the past.

So, there is no aspect of my own daily responsibilities as President that are not shared by the Vice President. He has a unique background in the Congress of having been both a member, simultaneously, of the Senate Finance Committee and also the Senate Budget Committee. So, here again, he's had a broad range of experience.

I would say, without derogating the other members of my staff, that there is no one who would approach him in his importance to me, his closeness to me and, also, his ability to carry out a singular assignment with my complete trust.

SALT NEGOTIATIONS

Q. Mr. President, it is said that we have modified our SALT position somewhat and, on the basis of that, we may be very near an agreement, and, on the basis of that, you may be meeting with Mr. Brezhnev in a few weeks or months. Is any or all of that true? [Laughter]

THE PRESIDENT. I will resist the temptation to comment on the accuracy or veracity of past comments made in the news media--and by you--[laughing]-I understand.

I think some of those statements are fairly accurate. We have been encouraged recently by the cooperative attitude of the Soviets. I have met several hours, on two occasions, with Foreign Minister Gromyko. And they have been fairly flexible in their attitude, and we have tried to match their cooperative stance.

There has been no decision made about a time or place for a meeting between me and Mr. Brezhnev. In fact, the meeting itself is certainly not a sure thing at all. It is, as a matter of record, his time to come to the United States, if and when a meeting does take place, and he has that permanent standing invitation which he can accept as he sees fit.

Our purpose in the SALT negotiations this year has been generally twofold: One is to reduce the overall level of nuclear armaments; and secondly, to have an assurance that there is an equivalent capability in the future to give a reasonable sense of security to both nations. And I think, at the same time, integrally with this is to let the Soviets know that we are negotiating in good faith, that we are not trying to pull a trick, .or to take unfair advantage over them.

At the same time, I recognize that progress on SALT leads to further progress on comprehensive test ban, on the matter of nonproliferation, on general reductions in armament sales around the world. And I think it would lessen tensions between us and the Soviets that have existed historically.

So, we are making some progress. An immediate agreement is not in prospect. We have narrowed down the differences to a relatively small number which could take quite a long time to resolve. Our negotiators are now going back to Geneva to try to eliminate as many of the differences as possible. So, reasonable progress has been made.

I wouldn't be too optimistic about an early settlement. And there is no plan at this time for a meeting with Mr. Brezhnev.

STEEL AND TELEVISION INDUSTRIES

Q. Mr. President, important segments of the steel and television manufacturing industries have been laying off thousands of workers recently because of foreign competition, some of which they allege is unfair. What, if anything, do you plan to do about that?

THE PRESIDENT. Well, we have already negotiated in the television industry a voluntary constraint on the Japanese, who are the major exporters to us. This was worked out this year by Robert Strauss, working even directly with Prime Minister Fukuda. I think this will alleviate the increasing imports of color televisions which were causing a problem.

The steel question is one that is obviously a highly complex question. I would not be willing to lay all the blame on imports. We have obviously some elements in the steel industry, where the plants themselves are older--they are not quite as efficient as some of the more modern plants overseas. We have a problem that the steel industry points out frequently in the compliance with fairly strict environmental quality standards, which I certainly would not change.

But I think it's fair to point out the Japanese and the West Germans have the same degree of quality constraints now on air pollution and water pollution. So, this is not an unnecessary advantage for them.

I might add quickly that we are addressing the steel industry with a multidepartmental approach. This is under the control of an Assistant Secretary [Under Secretary] in the Treasury Department, Mr. Solomon, who is an expert on the steel industry. He is working with Robert Strauss, our Special Trade Representative, and with Charles Schultze, my Council of Economic Advisers Chairman, with the Secretaries of Commerce and Labor.

Where large unemployment has been a factor with the closing of at least one steel mill, we have already moved to provide retraining and economic assistance for those workers involved. And within the next few weeks, I plan to receive the report of this group whose work was begun several weeks ago and then to meet with labor and industry leaders in the steel industry and also with Congress Members who have large steel interests in their own areas.

But we believe that the problems are chronic. I don't think any basic changes need to be made in our import laws or in the national statutes. And I think that perhaps my own involvement in it can cause some alleviation of the problem. But some of the problems are chronic.

The worldwide economic structure is not growing as rapidly as it has in the past. Ours is better off than most of the other nations'. And when the growth rate in our country drops down to 6 percent this year and many other major nations' drop to 4 percent or less, there is just not as many orders for steel. It's complicated. We are moving on it. And when I receive this report and decide what to do, I will make it public.

Charlie [Charles Mohr, New York Times].

RICHARD HELMS

Q. Mr. President, Admiral Turner of the CIA did a speech this week at Annapolis in which he said that the Attorney General would have to make a decision as to whether it would further the national interests to prosecute the case of Mr. Richard Helms, or whether it would be better to waive the case in order to save the secrets. But the Attorney General said that he was going to consult you on this.

I wonder if you can tell us your views on how you are reaching this decision as to whether certain material should be declassified for a possible trial in this case?

THE PRESIDENT. He has not consulted with me, nor given me any advice on the Helms question. I am familiar with it through reading in the press. I have no way to know yet the strength of the possible indictment or charges. I have no way to know yet the seriousness of the offense with which he will be charged (instead of "he will be charged.", the President meant "he may be charged.")¹ And I have no way to know yet the seriousness of possible damage to our own national security if massive revelations of intelligence techniques and documents are made either to ourselves or to our friends and allies.

¹ Printed in the White House Press Office transcript.

When I get all this information, then I would certainly consult with the Attorney General as to what action should be taken. I think it's a very serious thing for anyone to commit perjury (instead of "commit perjury" the President meant "commit alleged perjury") 1 before a congressional committee or anywhere else. And the matter would not in any case be treated lightly.

My understanding is that the Attorney General is now going over the data that have been presented to him. I think he will make a report to me and possibly a recommendation fairly soon. But until this moment, he has not yet done so.

I promised Marty [Martin J. Schram, Newsday].

BERT LANCE

Q. Mr. President, pardon me, I would like to go back to the subject of last week's press conference. You told us twice that you'd learned on December 1, which was just 2 days before you appointed Mr. Lance--nominated him----

THE PRESIDENT. Yes.

Q. ---that aspects of the Lance case had been referred to the Justice Department. Jody Powell has told us that you didn't know at that time, you didn't learn until much later. Who is right? Is Jody right, or are you?

THE PRESIDENT. I don't recall--I did say that in the last press conference. And when Jody asked me about it afterwards, I told him I was mistaken. I don't recall at all ever knowing that the Justice Department itself was involved in the Bert Lance overdraft or other problems last year. Bert Lance told me that he did not know that the Justice Department was involved in it until December 1. The information that I got from Bert Lance-I now know that it was November 15--was derived from Lance himself. And he states to me--and my memory confirms it--that he only referred to me the problem with the Comptroller's Office.

My guess is that on December 1 they did not specifically point out to me that the Justice Department was also involved. My memory of it is that they said that the problem that had been described to me had been resolved and that a press statement would be made then.

So, I would believe---certainly my memory confirms--that I did not know anything about the Justice Department itself anytime in 1976 and that Bert Lance did not know anything about the Justice Department being involved until the 1st of December.

If you have a followup, you can ask it.

Q. Just to follow up on that--

THE PRESIDENT. Please.

Q.---would it have made a difference to you if you had known at that time that there had been a Justice Department investigation?

THE PRESIDENT. No.

Q. Would you have delayed your appointment perhaps to see what the investigation had been about?

THE PRESIDENT. No, I doubt it because on the 1st of December when Lance himself found that the Justice Department was involved, it was also to learn that same day or the day after that the Justice Department had determined that there were no grounds for a further pursuit of the case.

WEAPONS PROGRAM S

Q. Mr. President, on the strategic arms situation.

THE PRESIDENT. Thank you.

Q. In the absence of an agreement as of next Monday, could you tell us what your attitude will be toward major American weapons systems that have been under research? For example, where do we stand now after this 5-year agreement expires on the MX missile; what is your attitude toward it? And how about on the cruise missile? During the period after the agreement expires, will you be observing any constraints, or do you think constraints ought to be reserved, for example, on the range of the cruise missile, the air-launched cruise missile?

THE PRESIDENT. We are proceeding with our research and development program on the items that you described. As you know, under the present agreement with the Soviets, there is no restraint on the mobile missiles nor on air-launched or ground- or sea-launched cruise missiles. Pending an agreement with the Soviets, we are free to proceed with those matters.

We are continuing to conduct active tests with the cruise missile. And I might say, the tests have been very successful so far. We have not proceeded that far along with the MX. We are negotiating with the Soviets on those two items for the so-called SALT II agreement. We have not completely resolved those two questions yet.

ENERGY TAXATION

Q. Mr. President, may I ask you something about your energy program? When you started talking about a wellhead tax, as I understood it, virtually all the money collected on that tax would be rebated back to consumers.

THE PRESIDENT. That's correct.

Q. Do you think, given Senator Long's attitude, that that kind of a wellhead tax is possible if you still give that tax? Or are you going to have to put part of that revenue into Government programs to spur energy exploration and development?

THE PRESIDENT. This was a matter that was debated very thoroughly among my own advisers and myself before we presented our proposal to the Congress on April 20. Our judgment was that the tax ought to be rebated directly to the American consumer. It's a fair and equitable way to dispose of that money. It would lessen greatly the American Government involvement in the oil industry. It would remove the very complicated entitlements program. And also it would not withhold large sums of money from an already kind of dormant economy.

If you gave the money immediately back in reduced payroll taxes, then the money would be circulated and you would not hold it in the reserve fund. I would have to retain some flexibility on that subject.

The thing that I don't want to do is to take the money from the American consumers in the increased price of gasoline and other products and give it as a reward to the oil companies. Now, matters that might relate to better transportation system or mass transit or better insulation of homes, combined with a tax rebate to consumers--I would consider all those as options.

Q. So, in other words, it won't all be coming back to the consumers now?

THE PRESIDENT. My preference is that it would all come back to the consumers. And as you know, that's the version that was passed by the House of Representatives. If I had my preference and could write the bill without congressional involvement, that would be my choice.

But I can't say that I would veto or fail to support any alternative. There are some alternatives that I could accept without too much reluctance.

MR. CORMIER. Thank you, Mr. President.

THE PRESIDENT. Thank you very much.