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1976/02/10 - Economic Policy Board
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1976/02/10 - Economic Policy Board
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James Cannon's Meetings Files
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The original documents are located in Box 56, folder "1976/02/10 - Economic Policy Board"
of the James M. Cannon Files at the Gerald R. Ford Presidential Library.
Copyright Notice
The copyright law of the United States (Title 17, United States Code) governs the making of
photocopies or other reproductions of copyrighted material. Gerald Ford donated to the United
States of America his copyrights in all of his unpublished writings in National Archives collections.
Works prepared by U.S. Government employees as part of their official duties are in the public
domain. The copyrights to materials written by other individuals or organizations are presumed to
remain with them. If you think any of the information displayed in the PDF is subject to a valid
copyright claim, please contact the Gerald R. Ford Presidential Library.
Digitized from Box 56 of the James M. Cannon Files at the Gerald R. Ford Presidential Library
EPB/ERC EXECUTIVE COMMITTEE MEETING
AGENDA
8:30 a.m.
Roosevelt Room
February 10, 1976
PRINCIPALS ONLY
1. Establishment of Labor Negotiations
Seidman
Committee
FEA
2. Clean Air Act Amendments
3. Report on Project Independence
FEA
4. Alaskan OCS
FEA
EPB/ERC EXECUTIVE COMMITTEE MEETING
AGENDA
8:30 a.m.
Roosevelt Room
February 10, 1976
PRINCIPALS ONLY
1.
Establishment of Labor Negotiations
Seidman
Committee
2. Clean Air Act Amendments
FEA
3. Report on Project Independence
FEA
4. Alaskan OCS
FEA
THE WHITE HOUSE
WASHINGTON
February 3, 1976
MEMORANDUM FOR THE ECONOMIC POLICY BOARD
EXECUTIVE COMMITTEE
FROM: :
L. WILLIAM SEIDMAN fros
SUBJECT:
Establishing an Economic Policy Board
Labor Negotiations Committee
Recent discussions at Economic Policy Board Executive
Committee meetings have highlighted the importance of
a large number of labor contract negotiations during
1976. There is a need to focus responsibility for
monitoring and developing recommended Administration
policy with regard to these negotiations.
The Food Deputies Group has successfully performed this
function on agricultural policy issues and a similar
group to monitor labor negotiations could be extremely
useful.
Recommendation: That the Economic Policy Board Executive
Committee establish a Labor Negotiations Committee to
monitor and develop recommendations for Administration
policy. The Committee will be chaired by the Department
of Labor and will include representatives from the Depart-
ment of Labor, the Department of Commerce, the Council
on Wage and Price Stability, the Council of Economic Advis-
ers, and the Federal Mediation and Conciliation Service.
The Committee will provide biweekly reports on labor
negotiation developments to the EPB Executive Committee.
THE WHITE HOUSE
WASHINGTON
February 9, 1976
FOR. ECONOMIC POLICY BOARD
EXECUTIVE COMMITTEE
The attached paper (s) will be discussed at the
Wednesday, February 11, 1976 EPB Executive Com-
mittee meeting.
Attachment
COUNCIL OF ECONOMIC ADVISERS
WASHINGTON
ALAN GREENSPAN, CHAIRMAN
PAUL W. MACAVOY
BURTON G. MALKIEL
February 6, 1976
MEMORANDUM FOR THE EPB -- EXECUTIVE COMMITTEE
FROM: Paul W. MacAvoy
Pame may
SUBJECT: Food Deputies Report No. 37
1. 1976 Crop Prospects
The USDA report on planting intentions for 1976 crops as of January 1
shows intended acreage of reported crops up 2.8 million acres (1 percent)
from 1975 plantings. The 1975 plantings were at the highest level since
1956.
Increased acreages are indicated for feed grains of 3.0 million acres
and wheat of 2.1 million acres. Corn accounts for 2.9 million acres
of the feed grain increase. Soybean acres planned are down 3.7
million acres. Reallocation of soybean acreage to corn and cotton
has been encouraged by recent relative price changes.
With last year's yield, corn production would be about 6.1 billion
bushels, about a 6 percent increase over the 1975 crop. For wheat,
there would be a similar increase except for the effects of weather
conditions. Despite increased planting the wheat crop could well be
smaller in 1976 than in 1975. The USDA estimate is that while 1976
planted acreage of winter wheat is 1.0 million acres higher than in
1975, harvested acreage will be 1.6 million acres less. The implied
percentage of wheat acreage planted but not harvested is 13 percent
for 1976, compared to 7 percent in 1975. Some of the abandoned
acreage could be planted to sorghum or other crops this spring.
The problem with wheat is the continuing drought and lack of snow cover
in parts of the winter wheat area. In its report based on December 1
conditions, USDA estimated winter wheat production for 1976 at 9 percent
REVOLUTION
AMERICAN
BICENTENNIAL
1776-1976
-2-
below 1975 despite a 2 percent increase in planted acreage. The
continuation of dry conditions since December 1 should have increased
the crop shortfall. However, the USDA December report may have been
too pessimistic given conditions at that time. One indication of this
is that the market did not react to the December report even though the
estimates were generally a surprise to the private trade.
There is extreme uncertainty in any yield projections at this time.
Precipitation by the end of February in the dry areas could restore
expected yields perhaps above USDA's estimates as of December 1.
However, events in the next several weeks will be critical. If
there were no rain or snow cover by the end of February the total
loss from conditions in the last few months could be 10 percent
of the wheat crop compared to the situation if yields were at last
year's levels. The uncertainty of this prediction should be emphasized.
2. Exports of Corn and Wheat
Export commitments to the U.S.S.R. were increased by 312,000 metric
tons of corn, bringing total 1975/76 commitments of feed grains and
wheat to the Soviets to 13.4 million metric tons. The increase
apparently results from inability to fill a previously existing sale
with Argentine corn, because of reduced Argentine corn production
prospects. Further such shifts are likely, perhaps 1 million tons
according to some in the grain trade.
Grain export commitments to Eastern Europe have increased by about
300,000 metric tons during the past two weeks, and now total 5.9
million tons for 1975/76.
Exports of corn and soybeans continue at levels which will exceed
the USDA projections of marketing-year totals if continued at rates
so far experienced. Exports of wheat, however, continue to run behind
the rate necessary to reach forecast exports.
The USDA has reviewed estimates of grain shipments to the U.S.S.R. from
all sources. It is now estimated that such shipments totaled 13.7
million metric tons for the 7-month June 1975 to January 1976 period.
Based on the monthly rate of shipments since October, 27 million tons
of grain could be imported by the Soviets in the July 1975-June 1976
year. With Soviet purchases for shipment in this period now estimated
at slightly above 25 million tons, they could buy an additional 2 or
3 million tons of 1975 crop grain.
If the outlook for the 1976 U.S. wheat harvest continues to deteriorate,
there will be an increased incentive for wheat importers to make contem-
plated purchases from the United States out of the 1975 crop rather than
-3-
waiting for the 1976 harvest. Thus, an expected shortfall in the 1976
harvest would tend to increase 1975 crop demand and price, and reduce
stocks of wheat carried out of the 1975/76 crop year. USDA now forecasts
1975/76 ending stocks at about 11.7 million metric tons, up 2.8 million
tons from the 1974/75 carryover. In this case, a 2.8 million ton short-
fall (about 5 percent of last year's total wheat production) could be
absorbed from carryover stocks by letting 1975/76 ending stocks return
to 1974/75 levels. (The 1974/75 ending stocks were not minimum levels,
since 1973/74 ending stocks, at 6.7 million tons, were lower still by
2.2 million tons.)
3. Agricultural Prices
The USDA index of prices received by farmers declined by one-half of
1 percent from December 15 to January 15, but the index on January 15
was 8 percent above a year earlier. For the year-to-year change,
livestock and livestock products were up 21 percent, while crops
declined 6 percent. The index of prices paid by farmers for
commodities, interest, taxes, and wages was up 1 percent for the
month ending January 15 and up 5-1/2 percent from a year earlier.
In the period since January 15, cattle and hog prices fell sharply but
have come back in the past few days, although they are still below
January 15 levels. The reduced cattle inventory estimate probably
helped strengthen prices in recent days, especially for COWS.
The farm price of wheat as of January 15 was 17 percent below a year
earlier. May futures prices of wheat were in the $3.58 range as of
February 4, slightly below the level of December 1, 1975. Apparently
the continuing adverse weather in the winter wheat area has been
offset by demand weakness, especially export demand.
For corn, the January 15 farm price was 21 percent below a year earlier.
The futures price of May corn was $2.73 as of February 4, down from the
$2.85 area as of the beginning of December.
ONLY
MINUTES OF THE
ECONOMIC POLICY BOARD
EXECUTIVE COMMITTEE MEETING
February 9, 1976
Attendees:
Messrs. Simon, Seidman, Lynn, Greenspan, Richardson,
Robinson, Dunn, Cannon, Zarb, Gorog, Porter, Wolf,
Goldstein, Penner, Kasputys, Hormats, Areena, Wood
1. Services and the Multilateral Trade Negotiations
The Executive Committee reviewed a letter from the Special
Representative for Trade Negotiations recommending establish-
ment of an interagency task force study to: (1) review international
issues of significance to U.S. service industries and describe and
assess the effectiveness of existing international forums on these
topics; (2) identify the problems faced by the U.S. service indus-
tries in international commerce not adequately covered at the pres-
ent time; and (3) consider solutions for these problems and how the
multilateral trade negotiations should relate to these solutions.
Decision
The Executive Committee approved creation of a Task Force on
Services and the Multilateral Trade Negotiations under the auspices
of CIEP. The Department of Commerce will chair the interagency
task force.
2. Roles of State and STR
The Executive Committee briefly reviewed a memorandum on the
roles of the Department of State and the Office of the Special Repre-
sentative for Trade Negotiations which is attached at Tab A.
Decision
The Executive Committee approved the procedural arrangements
outlined in the memorandum
EYES ONLY
DY ES ONL
2
3.
Status of Tax Initiatives
The Executive Committee reviewed the legislative status of the
President's tax initiatives, including his proposals for deepened
tax cuts, broadened stock ownership, accelerated depreciation
for construction of new plants and equipment, estate tax relief
for family farms and businesses, a Social Security tax increase,
and corporate integration. The discussion focused on the timing
of and form for submitting the accelerated depreciation initiative
and the deepened tax cut, the kinds of jobs likely to be created
by the accelerated depreciation bill and the kinds of jobs likely
to be created by H.R. 5247, and the need for a special session
on the details of the Administration's tax policy.
Decision
The Executive Committee will hold a special session on tax policy
Saturday, February 21, at 9:00 a.m. in the Roosevelt Room.
Treasury will distribute briefing materials for the special session
on Tuesday, February 17.
The Executive Committee approved recommending that the Admin-
istration send its accelerated depreciation bill to the Congress
before a Presidential veto of H.R. 5247
EYES ONL V
RBP
THE WHITE HOUSE
WASHINGTON
February 6, 1976
MEMORANDUM FOR ECONOMIC POLICY BOARD
EXECUTIVE COMMITTEE
FROM:
L. WILLIAM SEIDMAN gws
SUBJECT:
Roles of Department of State and
Office of the Special Representative
for Trade Negotiations
A series of meetings with representatives of the Department of
State and the Special Representative for Trade Negotiations
have resulted in the following delineation of roles between
the Department of State and STR:
1. Commodity Policy Development and Strategy
U.S. Government commodity policy will be developed through
the Economic Policy Board and the National Security Council.
The Assistant Secretary level EPB/NSC Task Force on Com-
modity Policy will report to the EPB/NSC on a biweekly
basis and will include representatives from:
The Department of State
The Department of the Treasury
The Department of Commerce
The Council of Economic Advisers
The Office of Management and Budget
The Council on International Economic Policy
The Special Representative for Trade Negotiations
The Assistant to the President for National Security Affairs
The Assistant to the President for Economic Affairs
Strategy for implementing commodity policy in the Conference
on International Economic Cooperation (CIEC) will be developed
through the CIEC Coordinating Committee and its four subcom-
mittees. The Office of the Special Representative for Trade
Negotiations will have membership on the CIEC Coordinating
Committee. The CIEC Coordinating Committee will report to the
EPB Executive Committee on a regular basis.
Interagency differences on commodity policy and strategy will
be considered by the EPB/NSC.
2
2. OECD
Representatives of the Department of State and the Office
of the Special Representative for Trade Negotiations will
serve as Joint Chairmen of the United States delegation
to the OECD Trade Policy Committee and as Joint Chairmen
of the United States delegation to all ad hoc OECD com-
mittees relating to trade.
3. STR Membership on Economic Policy Board
The Economic Policy Board will recommend that the President
designate the Special Trade Representative for Trade
Negotiations as a member of the Economic Policy Board.
The Special Representative for Trade Negotiations is
invited to attend EPB Executive Committee meetings when
commodity or trade policy issues are considered.
The Special Representative for Trade Negotiations, as
Chairman of the Trade Policy Committee, will report on
trade policy issues periodically to the EPB Executive
Committee.
The above procedural arrangements have been reviewed by the
White House Counsel's Office, the Department of State, and the
Office of the Special Representative for Trade Negotiations
and have been found in compliance with the Trade Act of 1974.