554–7

Conversation No. 554-7

Date: August 4, 1971
 21

NIXON PRESIDENTIAL MATERIALS STAFF

Tape Subject Log
(rev. 10/06)
Conv. No. 554-6 (cont.)


Time: 2:19 pm - 2:55 pm
Location: Oval Office

The President met with John B. Connally.

Connally’s schedule
-Forthcoming trip

President’s schedule
-Trips
-Workload
-H. R. (“Bob”) Haldeman

Unknown reading material
-Cartoon [?]

Economy
-Press conference
-Connally's assessment
-Foreign policy
-Wage and price policy
-Arthur F. Burns and George P. Shultz
-Pay increase
-Burns
-Monetary and fiscal policy
-Agreement with the President

Stephen B. Bull entered at an unknown time after 2:19 pm.

Shultz’s [?] arrival

Bull left at an unknown time before 2:55 pm.

-Duration
-Left-wing theories
-John Kenneth Galbraith
-Performance or short-term
-Need for enforcement procedures
-Bureaucracy
-Penalties
-Secretary of Labor [James D. Hodgson]
 22

NIXON PRESIDENTIAL MATERIALS STAFF

Tape Subject Log
(rev. 10/06)
Conv. No. 554-7 (cont.)


-Negotiations
-National Commission on Productivity
-Forthcoming meeting
-Enforcement
-Government action
-Connally’s line
-National Commission on Productivity
-Cooperation with Congress
-Scope
-Small and big business
-Enforcement
-Wage and price board
-Need for action
-Business
-Negative impressions
-News magazines
-Wall Street
-Consumer Price Index [CPI]
-Leading indicators
-Retail sales, silver standard, housing, construction, inventories
-Unemployment rate
-Figures
-Estimates
-Burns
-Burns
-Inflation
-International market action
-Gold window
-French action
-Impact on exchange rates
-Belgium, Netherlands
-Swiss
-Swiss proposal
-Two rate system
-Penalties
-French business
-Dollar speculation
-Dollar intake
-Switzerland, Belgium, France
-French action
-Valery Giscard D'estaing's recent speech
 23

NIXON PRESIDENTIAL MATERIALS STAFF

Tape Subject Log
(rev. 10/06)
Conv. No. 554-7 (cont.)


-Holding dollars
-Control on dollar speculation
-Stock market
-British
-Japanese
-France
-West Germany
-Dutch, Belgians
-Impact of policies on US
-International Monetary Fund [IMF]
-Domestic economy
-Psychological impression
-Figures
-Need for change
-Prognosis
-Connally's meeting with Charles W. Colson, Peter M. Flanigan, Paul W.
McCracken
-Pessimism
-Congress and media
-Negative factors
-International conditions
-Dollar's standing
-Steel settlement
-Pierre Rinfret's comments
-Investment tax credit
-Political strategy
-Memoranda’s business
-Wilbur D. Mills
-Critics
-Interest rates
-Inflation
-Money supply
-Interest rates
-Prime rate
-Meeting
-Connally and bankers
-Lockheed
-Bank of America
-[Louis B. Lundborg]
-Morgan guarantee
-American Bankers Association
 24

NIXON PRESIDENTIAL MATERIALS STAFF

Tape Subject Log
(rev. 10/06)
Conv. No. 554-7 (cont.)


-Connally’s remarks
-Interest rates
-Investment bankers
-Connally's remarks
-Turning point
-Change in attitude
-Need to face problems
-Congress
-International
-Defense
-Space
-Demobilization
-Employment
-International
-Japan
-US automobile industry
-Ford, Chevrolet, Plymouth
-Datsun, Toyota
-Germany
-Volkswagen
-Textiles
-President’s focus
-Foreign affairs
-Domestic affairs
-Business community
-Connally's recommended response
-Timing
-Japanese businessmen’s meeting
-Possible cancellation
-David M. Kennedy’s view
-Dinner with the President
-Forthcoming IMF and World Bank
-President's press conference
-Connally’s statement
-Burns
-Need to turn tide
-Connally's stampede analogy
-Lack of Congressional allies
-Democratic Congress
-Unemployment during Democratic administration
-Lack of publicity
 25

NIXON PRESIDENTIAL MATERIALS STAFF

Tape Subject Log
(rev. 10/06)
Conv. No. 554-7 (cont.)


-Placement of blame
-Michael J. Mansfield's statement
-1960's conditions
-Contact with Shultz

Reorganization
-Burns
-Federal Reserve Board [FRB]
-Fear of takeover by Treasury Department
-Ash Council
-Office of Management and Budget [OMB]
-Shultz
-Shultz’s suggestion
-Burns
-Control banker

Shultz entered at an unknown time after 2:19 pm.

Edwin S. Cohen's meeting with Connally
-Larry Woodruff and Mills
-Proposed tax program
-Tax code
-Timing
-Import tax
-Investment tax credit
-Shipping taxes
-Liberian, Panamanian, Greek ships
-Shipping tax
-Standard deduction raise
-Value-added tax
-Property tax reduction
-Depreciation on new plant equipment
-Cohen’s response
-Morale of division
-Connally's response
-Woodruff and Mills
-Similarity of views to Administration’s
-Cohen
-Previous tax bill
-Interest in preparing law
-House Ways and Means Committee
 26

NIXON PRESIDENTIAL MATERIALS STAFF

Tape Subject Log
(rev. 10/06)
Conv. No. 554-7 (cont.)


-Cohen

Manolo Sanchez entered at an unknown time after 2:19 pm.


**********************************************************************

BEGIN WITHDRAWN ITEM NO. 4
[Personal Returnable]
[Duration: 17s ]


END WITHDRAWN ITEM NO. 4

**********************************************************************


Sanchez left at an unknown time before 2:55 pm.

-Cohen
-Interest in politics
-Value-added tax

Busing
-Dallas
-John D. Ehrlichman
-President's statement [on Austin case, August 3, 1971]
-Dallas
-Press coverage
-Administration plan
-Importance
-Austin

Economy
-Connally
-Pressures for action
-Rinfret
-Tax reform
-Negative impressions
-News media
-Time, Newsweek, New York Times, Washington Post
 27

NIXON PRESIDENTIAL MATERIALS STAFF

Tape Subject Log
(rev. 10/06)
Conv. No. 554-7 (cont.)


-Reaction to President’s foreign policy initiatives
-1972 election
-Partisan split
-Foreign policy
-People’s Republic of China [PRC] initiative
-Democrats
-Psychological recession
-Unemployment
-Inflation
-Consumers
-Business community
-Attitude
-Inventories
-Publicists
-Effects
-Administration response
-Wage and price controls
-Consumers
-Negative attitude
-Time, Newsweek, Dun's, Rinfret, Fortune

Sanchez entered at an unknown time after 2:19 pm.


**********************************************************************

BEGIN WITHDRAWN ITEM NO. 5
[Personal Returnable]
[Duration: 9s ]


END WITHDRAWN ITEM NO. 5

**********************************************************************


Sanchez left at an unknown time before 2:55 pm.

Economy
-Negative impressions
-Business leaders and politicians
 28

NIXON PRESIDENTIAL MATERIALS STAFF

Tape Subject Log
(rev. 10/06)
Conv. No. 554-7 (cont.)


-Television
-Dan Rather
-Need to counteract
-Proposed administration actions
-Timing
-President’s press conference answers
-Wage and price board
-National Commission on Productivity
-Timing
-Holding action
-Congress
-Return from recess
-Budget
-Blue-collar workers
-House Resolution [HR] 1
-Symbolism
-Fiscal restraint
-Import tax, excise tax, investment tax credit
-Investment tax credit
-Percentage
-Research and development
-Budget
-Space program cutbacks
-Jobs
-Manned space flights
-Symbolism
-Cost
-Scientific value of flights
-Manned space flights
-H. R. 1
-Russell B. Long
-Wage and price freeze
-Import tax
-Inflation
-Enforcement
-Comprehensiveness
-Possible study
-Possible leaks
-Consequence
-Recommendations
-Jacob K. Javits and allies
 29

NIXON PRESIDENTIAL MATERIALS STAFF

Tape Subject Log
(rev. 10/06)
Conv. No. 554-7 (cont.)


-National Commission on Wages and Prices
-Wage and price board
-Connally’s view
-Shultz's view
-Problem of removal of freeze
-Guidelines
-Negative impressions
-Wage and price freeze
-Psychological effect
-International
-Stock Market
-Newspapers
-Chicago Tribune
-Texas
-Ohio
-Iowa
-Shultz's meeting with Senators
-Gordon L. Allott
-Colorado unemployment rate
-Budget deficit
-Administration’s response
-Psychological terms
-World War II analogy
-Press
-Ezra T. Benson
-Symbolism
-Wage and price freeze
-Impact
-Duration
-Wage and price board
-Price increases
-Timing
-Connally's recommendations
-Separate imposition on as part of package
-Political aspect
-President’s view
-Reasons for delay
-Thorough analysis
-Avoiding precipitous action
-Congress’ return
-Connally’s recommendations
 30

NIXON PRESIDENTIAL MATERIALS STAFF

Tape Subject Log
(rev. 10/06)
Conv. No. 554-7 (cont.)


-Forthcoming meetings
-Japanese visitors
-Finance ministers and central bankers
-Consultation with governments
-Closing gold window
-Confidentiality
-Peter G. Peterson
-The President, Connally, Shultz
-H. R. (“Bob”) Haldeman
-Line
-Budget
-Controls
-President's instructions to Shultz
-Treasury, Commerce Departments and FRB
-Equalization tax
-Congress
-Division of responsibility
-Office of Emergency Preparedness [OEP]
-Contingency plans
-Wage and price board
-Study proposal
-Republican request
-Testimony
-Administration
-OEP
-Bureaucracy
-Treasury Department
-Internal Revenue Service [IRS]
-Secret Service
-Banks
-Administration proposals
-Woodruff
-Excise tax
-Property tax reduction
-Budget
-Revenue sharing
-Future Congressional action
-Personal exemptions
-Investment tax credit
-Mills
-President’s bill
 31

NIXON PRESIDENTIAL MATERIALS STAFF

Tape Subject Log
(rev. 10/06)
Conv. No. 554-7 (cont.)


-Health insurance
-Tax proposals
-Health insurance
-Timing
-Strategy
-Spending delay
-Nelson A. Rockefeller
-Significance
-Connally’s metaphor
-Wage and price board
-Timing
-Freeze
-Political appeal

Connally left at an unknown time before 2:55 pm.

President’s schedule
-Burns

Economy
-Public psychology
-Burns
-Statement
-Democratic action
-August 1971
-Burns

Shultz left at 2:55 pm.