The President's News Conference

THE PRESIDENT. I have two or three brief statements I'd like to make before the questions.

THE SITUATION IN IRAN

First of all, I'd like to say a few words about Iran. Over the past several months, we have observed closely the events unfolding there. Our objective has been and is a stable and independent Iran which maintains good relations with the United States of America. Our policy has been not to interfere in the internal affairs of Iran and to express our firm expectation that other nations would not do so either.

We hope that the differences that have divided the people of Iran for so many months can now be ended. As has been the case throughout this period, we have been in touch with those in control of the Government of Iran, and we stand ready to work with them. Our goals are now, as they have been for the past few months, to ensure the safety of Americans in Iran, to minimize bloodshed and violence, to ensure that Iran is militarily capable of protecting her independence and her territorial integrity, to prevent interference or intervention in the internal affairs of Iran by any outside power, and to honor the will of the Iranian people.

These have been our hopes and our goals, and our involvement there has been, as you know, minimal during the last few months.

The curtailment of Iran's energy supplies is of special interest to the people of our country and to the world. This underscores the vulnerability about which I spoke when I presented our proposal for a comprehensive energy plan to the Congress in April of 1977.

The net shortfall from the curtailment of Iran's energy production is, on a worldwide basis, about 2 million 'barrels per day and for the United States a curtailment of about one-half million barrels per day. To put this in perspective, it comprises about 2 1/2 percent of the current American consumption.

Most petroleum stocks were fairly high at the beginning of this winter season, and while we are, therefore, in no immediate danger, the stocks here and throughout the world continue to be drawn down.

I want to emphasize and support the call that Secretary Schlesinger made for voluntary conservation of oil within our Nation by all Americans. If we would honor the 55-mile-per-hour speed limit, set thermostats no higher than 65 degrees in homes and buildings, and limit discretionary driving, voluntarily, and shifting to carpools and to rapid transit systems, we could offset the current reduction in Iranian supply of oil to our country.

A prudent public response early and on a broad-scale basis will make sure that any interruption in our economic system will be minimal in the future.

INFLATION

I'd like to make a brief statement about inflation, because last month's increase in the wholesale price index emphasized again a very clear message to our Nation, that we cannot shrink from making tough decisions which are needed to bring inflation under control.

The demands of special interest groups, no matter how legitimate or benevolent, must be resisted. The Congress must hold the line on Federal spending this year. We have steadily reduced the Federal deficit over the past 2 years, and we will continue to reduce the Federal deficit further. The Congress must act as well to pass long overdue legislation to contain hospital costs.

The American people badly need relief from this punishing, excessive inflation. I said when I announced our wage-price guidelines last fall that inflation might very well get worse in the short run before it got better. The January wholesale price index obviously bears out that prediction. But we do not expect such large increases in the wholesale price index to occur in the months immediately ahead.

All available evidence indicates that the guidelines which we've established are beginning to take hold. The first major wage settlement by the Oil, Chemical and Atomic Workers and by others since then have fallen within the 7-percent guideline figure. The overwhelming majority of major corporations have pledged to comply with the voluntary guidelines, and we expect the others to follow suit.

The staff of the Council on Wage and Price Stability, now well-organized, will vigorously monitor all pricing decisions to ensure compliance. The Congress must do its part in enacting legislation that we have proposed, real wage insurance. American workers who have restrained their own wage demands deserve this protection from our Government.

For more than 10 years now, we have lived with rising inflation. Now the program that we've set in force is beginning to work, and if we all do our part, we can succeed in reducing inflation in our country step by step.

I'm determined to use the full authority of my office to make this effort succeed. And I believe the Congress and all Americans are ready to do their part.

VISIT TO MEXICO

The last comment I have is about my Mexico state visit. Two years ago, President Jose Lopez Portillo of Mexico became the first head of state to visit me at the White House. This was no accident, but a carefully considered judgment, because I wanted to demonstrate the importance which I have placed from the very beginning on our relationships with our neighbor Mexico, the neighbor which shares the North American Continent with ourselves and with Canada.

About 40 hours from now, I will depart for Mexico City to return President Lopez Portillo's visit and to renew our own personal dialog as part of the consultations and negotiations which have continued, since his visit, among our Ministers and top Government officials.

We will be discussing some very important and very difficult problems, including trade, energy, and border issues. I'm looking forward to extensive discussions of global and regional problems, as well. As you know, Mexico plays a vital role in the entire world on a number of crucial issues, such as economic development, arms restraint, and nonproliferation. These issues are very important, both to President Lopez Portillo and to me.

Inevitably, there are differences in outlook between two such diverse and important neighbors as Mexico and the United States. But these differences are dwarfed by our common concerns, our common values, and our areas of cooperation.

I view this trip above all as an opportunity to listen and to learn. I want to hear President Lopez Portillo's views, and I want to relay my own views to him. We will be working together toward an even better future relationship between our two countries.

Thank you very much.

Frank [Frank Cormier, Associated Press].

QUESTIONS

U.S. RELATIONS WITH IRAN

Q. Mr. President, do you see much realistic hope of entering into a mutually productive relationship with the new Government of Iran?

THE PRESIDENT. Yes, I see continued hope for very productive and peaceful cooperation with the Government of Iran. This has been our posture in the past, and it will continue to be our posture in the future.

In the last few hours, our Embassy has reported that the followers of designated Prime Minister Bazargan have been very helpful in ensuring the safety of Americans, and we've been consulting with them very closely. So, I believe that the people of Iran and their government will continue to be our friends and that the relationship will be helpful to us.

U.S. RELATIONS WITH TAIWAN

Q. Mr. President, you said in an interview over the weekend that a future President has the option of going to war and protecting Taiwan. Senator Jackson says you should be more restrained. My question is, would you go to war to protect Taiwan?

THE PRESIDENT. I have no intention of going to war. The relationship that we have with Taiwan is one based on mutual interest, and I wanted to point out that no future decision by myself or my successor is prevented. But our country is one that believes in peace, and I have no anticipation that there will be any requirement for war in the Western Pacific.

Q. Mr. President, on the same subject of Taiwan, two related questions. You had earlier said that no resolution by Congress was necessary and suggested that almost any resolution that might come out of Congress which would give any kind of reassurance to Taiwan might not meet with your approval. I wanted to ask you, in the first place, whether you've changed your mind in any way about that, whether there is any kind of resolution from Congress which might be accepted by you? I have in mind particularly the approach of Senators Kennedy and Cranston.

And secondly, there remains confusion resulting from your January statement that you had pursued the goal of getting from the Chinese Government a commitment for peaceful solution of the problem of Taiwan. And, as you know, that resulted in some misunderstanding, which you might like to clarify.

THE PRESIDENT. Well, to repeat what I said in the last press conference, I think we pursued the goal of getting a maximum commitment possible from China about the peaceful resolution of their differences with Taiwan successfully. We did get the maximum, in my opinion, that was possible.

I have never said that I would not accept any resolution from the Congress. I have said that I don't think a resolution is necessary, because the legislation we proposed to the Congress, in my opinion, is adequate.

I could not accept any resolution or amendment to the legislation that would contradict the commitments that we have made to the Government of China, on which is predicated our new, normal relationships. And I think that any resolution or amendment that would go as far or further with the defense commitments to Taiwan would be unacceptable.

ENERGY CONSERVATION

Q. Mr. President, you had a relatively optimistic statement about the energy shortfall a couple of minutes ago, I thought. But isn't it more likely that in fact you're going to have to go to such measures as Sunday closing of gasoline stations? And as Senator Jackson said, the price of gasoline may go up to a dollar a gallon and we'll have long lines. Wouldn't it be better to sort of warn the American people about that?

THE PRESIDENT. Well, the situation is not crucial now; it's not a crisis. But it certainly could get worse. For instance, if we experience a worldwide shortage to the extent that our sharing commitment would be triggered, this would mean an additional shortage in our country that would go from 2 1/2 percent up to 4 percent. And if the Iranian production is not restored in the next number of months, our shortage in this country could go as high as 5, 6, or 7 percent, under which circumstances we would have to take more strenuous action.

But I believe the first step is to implement fully the new legislation that we now have on the books and to encourage the American people, as we have been for the last 2 years, strictly to enforce voluntary conservation measures. One thing that's concerned me recently is the move on the part of some ill-advised State legislatures to raise the speed limit above 55, up to 65 or more. This would result in a termination of Federal funds allocated to them for highway purposes.

But I think there has to be built in the American consciousness a realization that we can accommodate these potential shortages in oil production on a worldwide basis if we carry out a shifting from oil to coal or natural gas, under some circumstances, or to solar power, other sources, and if we restrain our wastefulness in the consumption of oil as much as possible.

WELFARE SPENDING

Q. Mr. President, in your 1976 campaign, you pledged a program that would relieve the heavy burden of welfare costs on a number of States and communities.

THE PRESIDENT. Yes.

Q. Your new welfare program apparently will take effect in fiscal 1982. And yet, last year in communications with Congress—and I believe it's the administration's stand now—you still oppose emergency fiscal relief that would bridge the gap between the situation that occurred in '76 in your comprehensive program. Why is that?

THE PRESIDENT. That's not an accurate assessment. Last year, we did propose

to the Congress substantial relief to major local areas, cities and counties, through our countercyclical aid proposal, which was focused on those communities that need the aid most. This proposal passed the Senate, but we were not able to get it out of the House Rules Committee, nor voted for favorably in the House in time to pass it.

We have resubmitted legislation for countercyclical aid which is now pending in the Congress, which I hope will pass. It's included within a very tight and restrained budget.

I think it's accurate to say, also, that some of the cities that were being burdened excessively by welfare costs, under the new administration—mine, working with the State and local governments-have severely, substantially reduced their welfare expenditures. And, of course, a part of this is because the unemployment rate has dropped substantially. But if you check the amount of money now being spent by New York City on welfare with what it was 2 years ago, you'll find substantial improvements there, substantial reductions in tax burdens for local people in paying for welfare, in addition to the countercyclical and other aid we've allocated already to local governments.

Judy [Judy Woodruff, NBC News].

U.S. RELATIONS WITH IRAN

Q. Mr. President, do you think that this Government should have been better prepared for the takeover by the Khomeini forces in Iran? And, also, in retrospect, do you think it was a mistake for you to embrace the Bakhtiar government as you did?

THE PRESIDENT. Well, obviously, had we had an exact prediction of what was going to happen. It's not the policy of our Government to go into the internal affairs of another people or country and try to determine who should be their leaders. This is contrary to the philosophy of our people. I think we've tried it once in the past in Vietnam and failed abominably. I think no one in this country of any responsibility wants to do that to a country, including Iran.

We have worked with the existing government. We worked closely with the Shah when he was in his office. We have worked with Bakhtiar, who was chosen, as you know, by the Iranian Parliament in accordance with constitutional provisions. Now Mr. Bakhtiar has resigned, and Mr. Bazargan is their Prime Minister. And the Majles, the parliament, has also resigned.

We will attempt to work closely with the existing government. But we have never tried to decide or to determine for the Iranian people or any other people on Earth who their leaders ought to be or what form of government they should have since I've been in office.

Q. But why did we have to make any statements of support for the Bakhtiar government? Why couldn't we just say nothing?

THE PRESIDENT. Well, we have statements of support and recognition for 150 nations on Earth. When we establish relationships with a government or a people, this is part of the diplomatic process. And when the governments change, quite often without delay, sometimes with a few days delay until the situation is clarified, we very quickly establish relations with the new government. But this is something that's historically been the case, and it's what we have pursued in Iran and what Ave will pursue in the future.

U.S.-SOVIET RELATIONS

Q. Mr. President, when Vice Premier Deng of China was in the United States, he made a number of anti-Soviet statements. In particular, on several occasions he said that the Soviets are seeking world domination. I wonder if you agree with that statement, and if you don't, I wonder what is your view of the Soviets' global intentions?

THE PRESIDENT. I have never tried to exercise censorship on a head of state or major official who came to our country. I didn't try to tell Mr. Deng what to say when he had press conferences. I didn't try to tell him what to say when he was meeting with the Members of Congress. I did not try to write his banquet toasts for him. And I think it's accurate to say that Mr. Deng's statements in our country are certainly no more noteworthy than the statements that he's made within his own country and that he's made in other nations. The position and attitude of the Chinese towards the Soviet Union have been very apparent to all of us for many years.

We have some areas where we disagree with the assessment of the Soviet Union as expressed by Mr. Deng. Our purpose, our goal, I would say, perhaps the most important responsibility I have on my shoulders as President is to preserve peace in the world, and especially to have good, sound relationships with the Soviet Union, based on a common desire for peace, which I am sure they share. We are working now every day to try to hammer out a SALT agreement with the Soviet Union. They have negotiated in good faith. So have we. This does not mean, however, that there are not areas of contention and areas where we have peaceful competition with the Soviet Union. This is expectable, and I think it will continue for many years in the future.

I don't have any inclination to condemn the Soviets as a people or even as a government. We'll explore in every way we can a way to carry out the purposes and honor the principles of our own Nation, to compete with the Soviet Union's people and government leaders peaceably when necessary, but to seek with them as much friendship, cooperation, trade as possible under those circumstances.

VISIT TO MEXICO

Q. Mr. President, in that you're going to Mexico, I'd like to ask a question on that subject. Given their new-found oil reserves and given the fact that you want to discuss such things as illegal aliens and trade, don't they have you pretty much over a barrel—pardon the bad pun- [laughter] —on the matter of illegal aliens, which they don't consider illegal, and on their protective trade rules, if we want any of their energy?

THE PRESIDENT. That's one of the reasons for going to Mexico is to explore the possibilities for resolving these acknowledged differences of opinion between our people and theirs. My goal will be to protect the interests of my Nation and the people whom I represent, and at the same time, obviously, to deal with the Mexicans openly and fairly and to understand and to honor the sensitivities that exist within that great country.

I'm sworn by oath to enforce the laws of our Nation, including immigration laws, to stop smuggling at the border, and in many areas those goals are compatible with the desires of the Mexican people and the Mexican Government. They've cooperated with us superbly, for instance, in stopping the illicit traffic in heroin. And I believe that this is one indication of how we can cooperate.

We are very proud of the recent discoveries of oil and natural gas in Mexico. Obviously, a burgeoning, improving economic situation in Mexico will provide hundreds of thousands of new jobs that will lessen the pressure on some of them to seek employment in our country. And I want to make sure that we minimize any illegalities relating to the border, and I want to make sure that when people are in our country, whether they are here as citizens or not, that we protect their basic human rights.

Another question about energy that you asked—a decision on how much to explore, produce, and sell oil and natural gas is a decision to be made exclusively by the Mexican people. We are interested in purchasing now and perhaps in the future even more oil and natural gas from Mexico. We'll negotiate with them in good faith. We'll pay them a fair price. We'd like to have those policies be predictable on delivery dates and also on price schedules. And we'll try to be a good customer. But we have no inclination to force them to give us a special privilege nor to do anything that would be damaging to the well-being of the Mexican people.

I don't see that these statements that I've made are incompatible with going to Mexico to meet with Lopez Portillo, to talk to his Congress, to talk to his people. I think the best way to resolve differences which do exist is in a framework as I have just described to you.

POLICY MAKING PROCEDURES

Q. Mr. President, you campaigned on a platform of sunshine in government. And in the last few weeks you've been telling your advisers not to reveal what goes on in the decision making process-some of the confusion and some of the disagreement.

THE PRESIDENT. I've never told them that.

Q. Can you enlighten us as to what you have told them? Are the reports in the paper wrong about you telling them to sort of cool it on that?

THE PRESIDENT. As has always been the case with Presidents and, I guess, other executive leaders, I have to have two basic relationships with my advisers and my subordinates that sometimes are incompatible. One is, I have to have the widest possible range of advice and counsel, tough debate, sometimes even open criticism as I evolve in my own mind a basic decision to be made on an important subject for the well-being of the people of this country. Then once I make that decision—and most of the controversial decisions are very difficult ones—once I make a decision, I expect my policy to be carried out with loyalty and with enthusiasm. When I make a policy decision that might be contrary to the advice received by some subordinate, if that particular subordinate cannot carry out my policy, then the only option for them is to resign.

There have been very few instances where I have permitted a deviation from that policy. I have never told my people who work under me in the State Department, NSC, Defense, Treasury, Housing, or anything else, not to have contact with the press. I do, however, have to insist upon a degree of teamwork, once a decision is made that relates to a sensitive issue like the Middle East or like SALT negotiations or like the relationships with Iran in recent months.

That's what I have admonished them to do, to have a free expression of opinion and to let me have their individual opinions up until the time I make a decision; once I make a decision, to comply with it.

Q. So, you do not object if members of your administration talk to reporters and tell them about the differences within the administration on a policy as it is moving up towards a final decision?

THE PRESIDENT. I don't think that's always appropriate. I wouldn't want to stand here and tell you that everybody that works in the Government is free to go and express their own personal opinions through the press as a policy is being evolved. Some of these decisions are based on highly secret information, either the attitudes of a foreign leader which cannot be revealed without embarrassment or based on security matters which, if revealed, might work contrary to the best interests of our country. So, I'm not going to issue a blanket permission for anybody in government to have a free access and to express their own views to the press.

I think that the policy that I have laid out is well understood by my people who work with me, both before and during and after a decision is made. And I think that I've described it about as thoroughly as I can this morning.

ENERGY CONSERVATION

Q. Mr. President, do you think that-well, you've spoken a lot about the energy legislation that has been passed by Congress and you also talk about enforcing wage and price guidelines, as well as implementing people's own voluntary efforts to reduce energy usage in the country. But my question is, most of the people, from our standpoint here, seem to feel that we are definitely not in an energy crisis per se. They still haven't been quite convinced. And then, when you say

THE PRESIDENT. You mean the White House Press Corps or the— [laughter]

Q. No, no, I'm talking about the average American citizen.

THE PRESIDENT. Okay. You said the people here

Q. And then you talk about—well, you asked the poor people in the country about the energy crisis, and you asked whether or not they would be inclined to reduce, cut down on their usage of lights—

THE PRESIDENT. What's your question?

Q. —or adhere to the 55-minute-power—my question essentially is, how are you going to enforce implementation of voluntary understanding of the energy crisis, the situation that we are in? And how are you really going to impress upon the people to voluntarily hold back, cut back on their energy?

THE PRESIDENT. Well, one obviously persuasive factor is the rapidly increasing prices of energy, which exercises economic restraint on people's wastefulness. When a person's electric power bill or heating bill goes up in a home, they are naturally more inclined to insulate their home, to cut down the thermostat, and so forth. When the price of gasoline goes up here and in other countries, people are naturally inclined to move toward more efficient automobiles or to reduce the unnecessary use of automobiles.

In addition to that, there's a patriotic element involved. When a President or other leaders call on the American people voluntarily to join together to enhance the economic well-being of the entire Nation, that has a good receptivity among the people of our country, now and in the past.

We have passed about 90—I'd say, 65 percent of the comprehensive energy proposals that I made to the Congress. Some of those are mandated by law, that there have to be shifts away from oil to coal, to solar power, and to natural gas, and to nuclear power, in some instances. Also, there are encouragements built into the law that now give people tax reductions if they shift toward a better insulation for their homes, for instance.

And the last thing is that we have mandated more efficient automobiles, that each year, step by step, the entire automobile production industry, here and abroad, have to comply with much more strict standards on automobile efficiency.

So, a combination of all those things, voluntary, patriotism, and mandated constraints, are the sum total of our energy policy.

THE FEDERAL DEBT

Q. Mr. President, your budget advisers are projecting sizable and rapidly growing budget surpluses after fiscal '81. This is sort of an old-fashioned idea, but I'd like to ask you, have you given any thought to using some of this money to reducing the Federal debt, which is now at $800 billion?

THE PRESIDENT. Well, obviously, when you have a budget surplus, that in itself reduces the Federal debt. The surplus is used to pay off existing debt. Those projections, however, many years in the future, 4 or 5 years in the future in some instances, are predicated on a fairly stable number of Federal programs. They do include basic welfare reform and an evolution into a comprehensive health program. But what the security needs of our country might be in the future or what other social programs might be, implemented by myself or my successor as President and by the Congress, are hard to predict.

But when we do build toward a balanced budget and then a surplus, those surplus funds would inevitably go into ,.educing the Federal debt.

EGYPTIAN-ISRAELI PEACE NEGOTIATIONS

Q. Mr. President, do you anticipate that at some point in time you're going to have to call a three-way meeting between yourself, President Sadat, and Prime Minister Begin to get this Middle East peace process locked up and that that might be a natural outcome of the Foreign Ministers' meeting that's coming up?

THE PRESIDENT. I would say that the reality of having a Mideast peace settlement is one of my fondest hopes and dreams and my greatest commitment. I have probably spent more of my personal time on trying to have peace in the Middle East than any other single issue.

We made tremendous strides forward at Camp David, as you know, and we expected at that time to rapidly conclude the remaining 5 percent of the issues that had not then been resolved. That has not proven to be as easy as we thought. I think an inevitable next step is to have the Foreign Ministers of Israel and Egypt come here to meet with Secretary Vance—I might visit with them briefly-in an attitude of mutual commitment and flexibility and in a maximum state of isolation from public statements or commitments, which quite often form a very serious obstacle to progress.

If that hope is realized, there would be no need for any further summit conference. But I would guess that in this case that Mr. Khalil and Dayan would go back to Egypt and to Israel to report progress and to seek confirmation of their negotiated positions from their own government leaders, including President Sadat and Prime Minister Begin.

If that effort is not completely successful and the final peace treaty terms are not concluded, then if there's adequate evidence of flexibility and desire on the part of President Sadat and Prime Minister Begin, then I would certainly consider favorably having them here for a summit meeting.

But our hope is that the Foreign Ministers can be successful, provided they take advantage of our recommendation and routinely go back to Israel and to Egypt to seek further guidance during the negotiations themselves.

OIL PRICES

Q. Mr. President, remembering the revelations that followed the 1973 oil crisis about how the major oil companies ganged up on the American people to reap huge profits, I'd like to know what assurances can you give us in light of what's happening with the cutoff of oil from Iran and the recent announcements of curtailed deliveries by domestic companies that such is not being practiced on the American people again?

THE PRESIDENT. Well, as you know, we have very strict laws concerning the pricing and delivery of oil, both that that's imported and that that's produced and sold within our own country. The laws will change the circumstance in May, and the control of oil prices will be terminated, I think, in September of 1980 [1981] ¹. What will happen then, I don't know, but I don't have any evidence now that there is a violation of either the law or proprieties in the pricing or distribution of energy products.

1 Printed in the transcript.

MR. CORMIER. Thank you, Mr. President.

THE PRESIDENT. Thank you.