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This file contains material relating to the Domestic Council Review Group on Regulatory Reform and President Ford's meetings with regulatory commissioners.
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Regulatory Reform (6)
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Regulatory Reform (6)
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This file contains material relating to the Domestic Council Review Group on Regulatory Reform and President Ford's meetings with regulatory commissioners.
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James M. Cannon Files (Ford Administration)
James Cannon's Issues Files
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Aeronautics, Commercial
Antitrust law
Government regulation
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The original documents are located in Box 29, folder "Regulatory Reform (6)" 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States of America his copyrights in all of his unpublished writings in National Archives collections.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 29 of the James M. Cannon Files at the Gerald R. Ford Presidential Library
THE WHITE HOUSE
WASHINGTON
August 4, 1975
MEMORANDUM FOR:
PAUL O'NEILL
FROM:
Regulatory Jun Reform
JIM CANNON
SUBJECT:
State and Local Involvement in
Since the Domestic Council has the responsibility for
the Regulatory Reform Review Group and for intergovern-
mental relations, it seems it would be best that we have
the responsibility for coordinating the reform efforts
with state and local governments.
CC: Cavanaugh
Falk
R. FCRD (TERKEY
THE WHITE HOUSE
WASHINGTON
August 27, 1975
MEMORANDUM FOR:
JIM CANNON
THROUGH:
JIM CAVANAUGHT #
FROM:
SUBJECT:
Regulatory Reform in Recent
PAUL LEACH Perform
Presidential Speech
The attached speech starting at page 4 contains regulatory
reform language which the Review Group influenced.
The importance of this speech is described in the attached
Wall Street Journal article.
THOUgHT THIS MIGHT BE OF INTEREST To YOU,
THE WALL STREET JOURNAL Pg. 3
AUG 26 1975
Ford Backs Corporate Tax Breaks, Vows
would "eliminate most of these anticompeti-
tive practices," and that "the remainder of
these practices, now immunized from the
To Stop 'Anticompetitive' Regulation
antitrust laws, are undergoing intensive re-
view." He said his administration will study
"the whole range of government-sanctioned
By a WALL STREET JOURNAL Staff Reporter
giving stockholders a tax credit for some
monopoly," from small franchises protected
Some items in this folder were not digitized because it contains copyrighted
materials. Please contact the Gerald R. Ford Presidential Library for access to
these materials.
25,
OFFICE OF THE WHITE HOUSE PRESS SECRETARY
(Chicago, Illinois)
THE WHITE HOUSE
See page 4 it seq
REMARKS OF THE PRESIDENT
TO THE
AMERICAN HARDWARE
MANUFACTURER'S ASSOCIATION
McCORMICK PLACE
9:37 A.M. CDT
Cardinal Cody, Mr. Spencer, distinguished
guests, ladies and gentlemen:
It is a very special pleasure and privilege for
me to be here this morning and to pay tribute to the American
hardware industry and to kick off Hardware Week in the
City of Chicago.
Yours is an industry that has taken American
ingenuity and coupled it with some of the most effective
merchandising techniques known to mortal man.
That may seem like some exaggeration, but a hard-
ware store is the only business I know of where you can
go to buy a 10 cent carriage bolt and come out with a can
of paint, a new, improved screwdriver, 50 pounds of charcoal
brickets, a bicycle repair kit, ten minutes of free
advice, 12 picture hooks, six fuses and a lawnmower, and
then have to go back because you forgot the 10 cent
carriage bolt you went to buy there in the first place.
(Laughter)
I have been a typical homeowner most of my
life, and my wife Betty knows it. She says that sending
me to a hardware store is the nearest thing she knows to
playing chicken with our life savings. (Laughter)
Nevertheless, on behalf of all of us "do-it-
yourselfers," let me thank all of you here for making
possible the wonder of wonders -- the neighborhood hard-
ware imporium, more affectionately known as the world's
only candy store for grown-ups. (Laughter)
MORE
Page 2
In your business, you constantly seek out those
new ideas that are so important to a great country, and so do
we in this country. In fact, no nation or society in history
has done more to encourage invention, innovation and
initiative.
The explosion of American ideas began 200
year ago with our Declaration of Independence. A century
ago a tide of industrial progress started to sweep over
America, sewing machines revolutionized the clothing
industry. Electricity made life brighter and more prosperous.
Automobileassembly lines put us on wheels. The telegraph
and telephone -- later movies, radio and television -- linked
the people of this vast Nation closer and closer together.
In our generation, America has split the atom and
conquered space. Americans never shirked from challenge.
Courage, originality, opportunity and optimism are national
traits.
This has been the spirit of America for the past
two centuries -- a spirit of ideas and individuality. It
was and is the spirit of private enterprise -- churning
ahead in a free, competitive system fueled by private savings
and investment. We need to recall these basic facts about
America, about ourselves as a people and about our way of
life.
No nation has invested more than we have in
humanity and science. No nation has taken greater risks or
experimented as much for progress. As a result, no nation
has earned such rewards as the United States.
Today America is again called upon to invest,
to risk, to experiment in the name of progress. But
unfortunately, we have reached a watershed. A decision
must be made. The question, put simply, is precisely
this: how do we finance both the investment needed for
economic growth and essential programs needed to solve our
human problems?
Today we are faced with a problem of creating
new jobs in numbers greater than ever before in America.
Although unemployment is far too high, nevertheless we
should not forget that 85 millions in this great country
are at work and that is about 1.2 million more than just
last March.
By 1980, we must create another 14 million jobs
to meet the needs of our expanding population. This is our
objective, and it will require substantial economic progress.
As always, economic progress depends on our ability
as a Nation to foster capital investment and increase
the productivity of our workers. The share of our
gross national product committed to the private sector
investment must increase significantly over the next few years
if we are to reach our economic potential. Some, for
example, estimate that total investment requirements could
reach as high as $4 trillion.
MORE
Page 3
However, as our need for capital grows, the
abilities of industry to generate necessary funds is
declining. This is essentially because inflation has
eroded corporate balance sheets and because our national
tax laws fail to stimulate such investment.
In short, our financial ability to increase
production is declining. This decline is curtailing
needed growth in jobs and income and undermining our
ability to compete internationally.
I am very confident once this becomes clear to
the American people they will understand America's need
for tax policies that will help to channel sufficient
resources into the expansion of productive capacity.
At today's level of economic activity, no shortage
of industrial facilities exist, but our Nation's economic
machine is not now running at top speed. In the
future, we have every reason to expect it will, but we
must now not permit bottlenecks and shortages to reappear
as the economy gains momentum.
We must not condemn our fellow citizens to
unemployment because the modern tools needed to compete
in world markets are lacking.
Capital, as all of you know, is vital to all
segments of our economy to expand agricultural production,
to develop domestic resources of energy and raw material,
reducing our dependence on oil imports and to preserve and
to improve our economy.
This Administration has proposed reforms to the
Congress to stimulate through what some call capital forma-
tion through tax incentives, but I prefer to use the term
"job creation" because that is what the proposals would do
as a practical matter.
If adopted, they would provide the funds to
expand America's industry capability to create jobs, for
one thing, by reducing the double taxation on dividends.
As expected, these proposals have raised an
outcry from some Members of Congress who oppose them and,
as a person who was in the Congress for a number of years,
I understand these voices.
The Congress, in this case, as in others, has
come up with no alternatives. We have got to push them
to action here, as well as elsewhere. America cannot put
its faith in wishing wells. We must do something about
expanding our sources of capital to create jobs, and we
must do it right now.
MORE
I ask the Congress to join with me in this
commitment to our Nation's future, to increase jobs,
income and full economic recovery.
Let us expand the size of our economic pie
rather than simply redistributing the pieces of a much
smaller piece of pie.
By itself, however, additional capital cannot
revitalize the American economy and our free market
system. We must also take steps to help restore the
vitality of the marketplace and effective competition is
the way to do it.
Too often in the past our Government has
stifled that competition in the name of economic regula-
tion to the detriment of the consumer. For that reason,
my Administration -- with strong support of the Congress
in this instance -- is seeking fundamental reform of economic
regulation in the United States.
The problem is simply this: In many industries,
transportation, energy, communication, as well as others,
Federal regulatory commissions have actually, thwarted
competition. The bureaucratic monopolies have tackled
business and conflicting policies and red tape far, far
too long.
The record is clear. They have burdened the
consumer with the cost of misdirected regulation.
Although I am greatly encouraged by widespread
backing for regulatory reform, I also recognize we still
have a long, long way to go to achieve it. With the
continued support, which is very evident, with the support
of you, as well as your industry, we will reverse the
trend of the last few decades.
We will establish as national policy this basic
fact of economic life, that Government regulation is not
an effective substitute for vigorous American competition
in the marketplace.
Having said this, let me add that some -- and
let me qualify it by saying some -- regulations are
necessary and appropriate; for instance, involving health,
safety and the environment.
But the reforms that we seek would eliminate
the impractical, the unnecessary and the obsolete.
As part of this effort to insure that we have a strong
economic system, we must maintain an anti-trust policy
which validates our commitment to competitive markets.
MORE
rage J
If we reduce Government regulation of business,
we must make certain and positive that our anti-trust
laws are vigorously enforced.
Competition, when freed of Government regulation
and supported by anti-trust laws, is the driving force of
our economy. It will drive costs down to their minimum
and assure prices based on these legitimate costs.
Yet, such steps cover only a part of the over-
all problem. It is much more difficult to deal with areas
that anti-trust laws do not touch, these other regulated
and legal monopolies and the Government sanctioned cartels.
For instance, various industry rate bureaus
and self-regulatory agencies -- transportation rate
bureaus, shipping conferences, stock exchanges and
professional associations -- now seem to operate in a
congenial cost-plus environment.
This is simply because Government once decided
they need not, or cannot, compete.
They are allowed to fix prices and divide
markets under the regulatory cloak, free from anti-trust
enforcement.
An essential element of regulatory reform legis-
lation I have already sent or will send to Congress will
eliminate most of these anticompetitive practices. The
remainder of these practices, now immunized from anti-
trust laws, are undergoing intense review in the Executive
Branch of the Government.
In short, this Administration will look at the
whole range of Government sanctioned monopoly -- from the
small franchises protected by Federal regulations, which
rule out competition, all the way to Government-endorsed
cartels involving entire industries.
We must recognize this: Over the years Govern-
ment has done as much to create and perpetuate monopoly
as it has done to control or eliminate it. As a result,
this Nation has become accustomed to certain forms of
monopoly. Some are regarded as beneficial, some not.
If an industry combines to raise prices, it
violates our anti-trust laws, but no laws are violated
if an industry can get the Federal Government to build
trade barriers, to increase support prices for the goods
or services that it produces, or to police against potential
competitors or pricecutters.
MORE
Page 6
It is sad but true -- too often the Government
walks with the industry along the road to monopoly.
The end result of such special treatment
provides special benefits for a few, but powerful, groups
in the economy at the expense of the taxpayer and the
consumer.
Let me emphasize this is not -- and never will
be -- and Administration of special interests. This is
an Administration of public interest, and always will be
just that.
Therefore, we will not permit the continuation of
monopoly privilege, which is not in the public interest.
It is my job and your job to open the American marketplace
to all comers.
Ultimately, the vital reforms will be viewed
as they should be -- as a pocketbook issue. Government
regulation and restrictions now cost consumers billions
and billions of dollars each year. We must be concerned
about the cost of monopoly however it is imposed and
for what reasons.
We must be sure that regulatory reform and anti-
trust actions go hand in hand with incentives to spark
capital investment to create new jobs and new competition.
This is what I firmly believe is needed to revive the
American economic dream.
Before I close, let me share one thought with
you. It concerns a subject that affects the lives and
the pocketbooks of every American -- the runaway growth
of the Federal Government itself.
One of the goals I have set for myself as
President is to cut big Government down to size -- and we
can do it this way -- to make it more manageable, more
responsive, more efficient and less costly. I want to put
an end to the mountain of paperwork and the quicksand of
regulation which big Government makes every businessman
cope with.
Do you have any idea how many different Federal
forms Washington sends out and asks you to fill out?
Would you believe it is over 5,000 -- 5,000 Federal forms
to keep Washington at work and businessmen from their work.
Believe me -- and obviously you agree -- this is
not the way this great Nation was built over a 200-year
span. I can vividly recall how my father started a small
family factory back in, of all years, 1929. In those dire
economic circumstances, everybody pitched in.
My speciality -- and it didn't require much skill --
was mixing the paint and labeling cans. But, my father was
always out there selling the merchandise and doing what makes
sense for the business, not what makes sense for the
bureaucrats.
The Ford Paint and Varnish Company survived the
depression. And I have wondered if it would have if my
father had had to fill out all of today's forms and
applications and those thousands and thousands of questionaires,
and at the same time, cope with a patchwork of rules and
regulations which face today's businessmen.
My objective is to get the Federal Government
as far out of your business, out of your lives, out of
your pocketbooks and out of your hair as I possibly can.
To this end, within three weeks after I came into
the Office of the Presidency last August, I directed the
heads of all Federal Government, departments and agencies
to reduce the personnel for whom they had requested funds
for the remainder of the fiscal year by 40,000.
Actually, I can report to you today that their
performance exceeded my directive. We ended fiscal year
1975 on June 30 of this year with a reduction or a cutback
of 52,000 Federal employees under the planned levels of
a year ago.
As far as those 5,000 Government forms, I can
tell you this: several months ago I directed Jim Lynn,
the Director of the Office of Management and Budget, to
examine, to analyze, to evaluate and then throw out as many
of these timewasters as he possibly can. And I am going to
personally monitor it.
To put it very simply, I want to see the American
businessman pushing merchandise, not pencils.
You don't need a lot of bureaucrats looking over
your shoulder and telling you how to run your life or how
to run your business. We are a people who declared our
independence 200 years ago, and we are not about to lose it
now to paper shufflers and computers.
Let's take the shackles off American businessmen.
That is the only kind of hardware I don't approve of.
Thank you very much.
END
(AT 10:02 A.M. CDT)
MEETING ON REGULATORY REFORM
Leach, Dunham, MacAvoy
Friday, September 26, 1975
5:15 p.m.
Mr. Cannon's Office
is
FORD
0
THE WHITE HOUSE
WASHINGTON
Oct. 20, 1975
Put original of this memo
be forthcoming for your
signature.
Rod Hills thought you might
like an advance copy to
review in the meantime.
PLs File
p
THE WHITE HOUSE
WASHINGTON
October 20, 1975
MEMORANDUM FOR THE PRESIDENT
THROUGH:
PHILIP BUCHEN
JAMES CANNON
RICHARD CHENEY
FROM:
RODERICK HILLS
In our meeting in your office with Secretary Coleman before the
announcement of the airline bill and at the subsequent Cabinet
meeting, we had a brief opportunity to discuss the current status
of the Regulatory Reform Task Force. However, my view and
that of Messrs. Buchen and Cannon is that you should have the
oppor tunity to review in more detail the future direction of the
regulatory reform program.
Moreover, it is important, both for the energy and morale of the
Task Force, that its future efforts be encouraged by you.
For the past six months, various parts of the Administration have
been trying to develop and implement a comprehensive and credible
program of regulatory reform. Principal responsibility for
formulating and coordinating Administration policy in this area
has rested with the Domestic Council Review Group on Regulatory
Reform. For your information, I am attaching at Tab A a memo-
randum to the Economic Policy Board in July, outlining the
composition of the review group and its approach to the program.
This memorandum seems to have been well received, but it has
not been formally accepted, even though a request for such an
endorsement was made in September.
I have also attached at Tab B brief summaries of some of our
regular Wednesday afternoon meetings to give you more precise
information as to the nature of the effort thus far.
-2-
I feel it is critically important, for the morale of the individuals
leading this effort and the credibility of the program, that you
meet to discuss your priorities and develop an understanding of
your long term objectives with representatives of the group.
Submission of the air bill last week was well received both on
the Hill and in the press. This initiative has brought an added
enthusiasm to the Review Group's efforts. It is important now
to continue the momentum by obtaining a fresh sense of your
priorities.
Although Phil Buchen is moving quickly to select my successor,
in the interim, it would be helpful if we could schedule a 30-minute
session with you and key Task Force members from CEA, the
Domestic Council and OMB.
I would, of course, very much appreciate attending such a meeting
if it can be arranged in a fashion suitable for your schedule before
I leave. However, Paul MacAvoy can certainly adequately represent
the effort to date.
FORD
/
THE WHITE HOUSE
WASHINGTON
July 16, 1975
MEMORANDUM FOR:
ECONOMIC POLICY BOARD
FROM:
ROD HILLS RH
SUBJECT:
Domestic Council Review
Group on Regulatory Reform
The President has given the Domestic Council responsibility
for coordination of his regulatory reform effort. To this
end, the Domestic Council has established a Review Group on
Regulatory Reform to serve in the coordinating role. Included
in this Review Group are:
Member
Working Representatives
Counsel's Office
Rod Hills
Domestic Council
Paul Leach
Lynn May
Council of Economic
Paul MacAvoy
Advisers
Office of Management
Cal Collier
and Budget
Stan Morris
Department of Justice
Jon Rose
Council on Wage and
George Eads
Price Stability
Jim Cannon has designated me as Executive Director of this
Group and Paul MacAvoy and I will serve as principal spokesmen.
Paul Leach is the Domestic Council staff person with primary
responsibility for staff coordination.
Where appropriate, other Executive departments and agencies
and White House staff will be involved. Major economic
regulation initiatives will be presented to the Economic
Policy Board.
It is anticipated that all staff resources necessary to achieve
the President's regulatory reform objectives will be provided
by the White House staff groups and Executive departments and
agencies.
-2-
The principal goal of the Group is to achieve tangible reform
in the next year reduction of Commission activities where
unnecessary and improvements in the efficiency of operation
where there is a strong rationale for continued regulation.
To deliver on the President's goals, we must have concrete
results this year. A secondary goal for 1975 is to have
results and a second year program by the time of the State
of the Union Address.
The attached draft of an Agenda for the July 18 Review Group
meeting provides a brief picture of where this effort is
going during 1975.
DOMESTIC COUNCIL REVIEW GROUP ON REGULATORY REFORM
Meeting Agenda - July 18, 1975
I.
Legislative Activity (with primary responsibility)
A. Legislation Before the Congress
1. Railroad Revitalization Legislation submitted. House
Commerce Committee is holding
hearings. Some legislation
possible this session.
OMB & DOT
2. Natural Gas
Continue to push for de-
regulation of natural gas.
Speedy congressional action
unlikely. OMB & FEA
3. Financial Institutions
Legislation submitted, but
some legislative action likely
in this Congress. OMB &
Treasury
4. Fair Trade
Legislation submitted. Push
for repeal, which should
happen in 1975, and take
credit with signing ceremony.
OMB & Justice
B. Legislation Being Developed
1. Trucking
Send bill to Congress by
August with Presidential
message and press briefings.
OMB & DOT
2. Airlines
Send bill to Congress by
September with Presidential
message and press briefings.
OMB & DOT
3. Robinson-Patman
Finish proposed bill by
August. Send to Hill with
Presidential message and
press briefings. OMB &
Justice
-2-
4.Cable T,V.
Develop and consider leg-
islation by September.
Domestic Council & OTP
C. New Areas to be Considered
There are a variety of new areas where a policy review
might be undertaken. These range from (a) a major over-
haul or abolition of existing agencies, e.g., the FMC,
(b) determination of the long-term regulatory role of
FEA, (c) development of effective anti-trust policy
particularly with respect to the Clayton and Federal
Trade Commission Acts to (d) creation of incentives
rather than use of the rule-making approach to health,
safety and environmental regulations.
II.
Follow-Up to the Regulatory Summit
1. Presidential letter to Commissioners sending transcript
of July 10 meeting and asking for:
- Specific plan to reduce delays
- Description of economic analysis activities
2. Follow-up with continual contacts at both Commissioner
and staff levels to see that internal reform effort
continues.
3. Encourage Congressional committees to hold oversight
hearings on delays in each Agency.
4. With Justice making major contribution, set up group
to propose changes in the procedures of the Agencies.
Changes can be internal or legislated.
5. Closely control Commission appointments. Develop list
of acceptable candidates and committed deregulators.
6. Establish group to work with Independent Agencies in
improving economic analysis.
7. Push FPC to allow interstate shipment of natural gas
which is purchased by industrial firms in the intrastate
(unregulated) market.
-3-
III.
Regulation by Executive Departments and Agencies
1. Presidential effort to get Cabinet (and other) officers
committed to reform. Announce meetings between Review
Group and Cabinet officers to obtain specific 1975
reform objectives.
2. Develop a full catalog of agencies: Their respon-
sibilities, weaknesses and opportunities for improve-
ment.
3. Target several "dependent" agencies where the Review
Group can concentrate its efforts.
4. Examine and assist FEA task force efforts to remove
bottlenecks in development of new energy projects.
IV.
Congress
1. Presidential letter to 24 Members to report on Independent
Commissions meeting. Draft completed.
2. Continue contacts with Congressional regulatory reform
group and their staff.
3. Schedule another meeting with Members after Labor Day.
4. Closely monitor legislative strategy on all regulatory
reform bills to insure White House coordination.
V.
Speeches and Other Events
1. Develop speech for President to give consumers on the
impact of regulation on consumer costs, then schedule.
2. Develop speech for President to give to a "special
interest group" in which he talks tough on the need for
regulatory reform, then schedule.
3. See that Paul Theis has materials necessary to keep
regulatory reform in a variety of Presidential speeches.
4. See that a group of spokesmen for the Administration
begin to emphasize regulatory reform in speeches.
FORD is 93RA70 LIBRARY
-4-
VI.
Press
1.
See that President is continually briefed on status
of regulatory reform and has talking points for
interviews.
2. Work with Press Office to educate general and
specialized press about the Presidential effort.
3. Monitor press reports and editorials. Reply where
necessary.
VII.
State and Local Regulatory Reform
1. Finalize State and local task force on regulatory
reform.
2. Articulate Presidential interest in this area.
VIII. Organization and Management of Effort
1. Set priorities for activities and assign responsibilities.
2. Insure availability of staff resources needed to achieve
President's objectives.
3. Provide for regular coordinating meeting.
4. Develop routine status report.
1. Trans ortation misl
Efforts to recolve the merger/
an ust 43 is in the air bill were discussed.
Justice has oh a Union package which will be
discussed with the Secreting and the Attorney General
as soon as possible. A first drunt of the Presidential
message has bach completed and work on the analysis, fact
sheet, section-by-section and indiation impact statement
are proceeding. Legislative clearance will be completed
by 9/12. Stan Morris reported that DOT testimony at the
Senate rail hearings went well. He mentioned that plans
were going forward for the meetings with industry and the
unions on the truck bill. DOT's summary table of the
backup analysis on that bill is due this week.
2. Robinson-Patman. Johnathan Rose announced that Justice
is working on plans for piblic hearings while at the same
time pursuing Hill Judiciary Committee contacts encouraging
them to initiate action on Robinson-Patman. Justice has
met with Under Secretary Baker from Commerce regarding a
possible 4-city schedule for public hearings. It was
suggested that consideration be given to holding broader
hearings on predatory pricing problems under the auspices
of CWPS. This might help to avoid the pro-business image
and could produce more useful information.
3. Inflation Impact. Stan Morris reported that HUD and FEA
are the only agencies which are not now in compliance with
the Executive Order and A-107.
4. Dependent Agency Review. Paul Leach is meeting with Joe
Wright of USDA tomorrow to set up the meeting with
Secretary Butz. Others to attend the Butz session include
Paul MacAvoy and Jim Mitchell. Paul Leach mentioned that
USDA has set up their. own internal reform group. George Eads
mentioned CWPS was considering a second review of marketing
orders which should be discussed in the meeting with USDA.
Justice will contact FTC (Michael Lynch) to get a report
on Capper-Volstead by 9/19.
Meeting with DOT deferred until the transportation
legislation is farther along. Papers on EPA and HEW will
be completed. Scheduling of those meetings will be done
by 9/19.
BERALD FORD LIBRARY
5. Cable TV. Lynn Nav noxt
afternoon (9/16) 201 or in
the cable issues
recommended scheduling meetings with industry people
as soon as possible.
6. Postal Service. It. was announced that a joint Domestic
Council/Cla memo recommending a Low-log budget review
type study of the Postal Service will be sent to the
President today if possible.
7. State/Local Task Force. Stan Morris reported that
Jim Falk has talked to Governor Hoel and that announce-
ment of the task force is ready, pending an exchange of
letters between Governor Ray and the President.
8. Press Plan/Speeches. Margaret Earl reported that the
Press Office has outlined a schedule of events to
accompany submission of the air bill. It will be
submitted for Ron Nessen's approval. The Press Office
can be ready to go on 48 hours notice. Also, they are
working with Bill Baroody's staff to design ways to
attract consumer attention to the bill.
9. Follow-on Presidential Meeting with Congressmen. It was
agreed we should plan to hold a session with the 24
Congressional representatives to discuss the full range
of Administration-sponsored or supported legislation.
Paul Leach will develop an agenda and schedule by next
week.
FORD is GERALD LIBRARY
SUMMARY
OF
NUETING
17
THE ROOSTWENT ROOM
1. Rail Bill. John Snow reported that both House and
Senate SubCommittees have held hearings on the Adminis-
tration's rail bill and each has drafted a substitute
bill. Both Committees seem to have accepted the concept
of the need for regulatory reform (particularly on the
ability of carriers to act independently from the ICC)
but neither Committee appears to be as critical of rate
bureau procedures as is the Administration. Both Com-
mittees are discussing restructuring provisions, however,
the locus of reorganization authorities and financial
assistance differs, and the House bill would make $2.6
billion in grants available, in addition to loan guarantee
privileges. Though the ATA has voted not to support the
rail bill, trucking opposition to date has been less
than expected. Severe and potentially harmful opposition
is coming from barge carriers, who compete more directly
with rails on large shipments of bulk goods. DOT is
working to head off such opposition. A bill is expected
to be reported to the full House Committee before the
Columbus Day Recess.
2. Truck Bill. Stan Morris indicated that DCRG members will
meet early next week to finalize the strategy to be
adopted in dealing with industry and union representatives
on the proposed truck bill. At issue is the strength of
the Administration's argument and what compromises, if
any, the President will order prior to submitting a bill
to Congress.
3. Air Bill. Stan Morris reported a meeting on 9/18 between
Secretary Coleman and Attorney General Levi to try to
reach a final position on mergers and inter-carrier
agreements. If a solution is reached, the air bill could
go to Congress by 9/25. If not, a Presidential memo will
have to be drafted, asking for a decision on the issues.
LIBRARY BERALD = FORD
2
4. Robinson-Patman. Jon Rose indicated some Senate staff
willingness for Senator Hart to submit a repeal bill,
without his personal commitment to chair hearings or
endorse the measure. (Senator Mathias might be an
alternative.) Rep. Seiberling has indicated support
for a reform bill, but opposes repeal. Justice is
continuing to prepare for four regional hearings, and
is open to discussion on the OMB paper suggesting a
larger antitrust agenda for such hearings.
5. Regulatory Costs and NSF Study. Stan Morris recounted
the origins of the $2,000 per family cost figure,
explained the Moss Committee/GAO response, and indicated
NSF's interest in a 12 month study of regulatory costs
and benefits. (He distributed the NSF prospectus for
comment.) After some discussion on how the Adminis-
tration should respond to the Moss press release, it
was agreed Stan Morris-and Margaret Earl would meet
with Bill Greener to get à decision on the appropriate
strategy to adopt.
6. Inflation Impact. Stan Morris reported that a status
report on the program had been given to the EPB. There
is some EPB concern for the potential of slowing down
important government activities- a response is being
prepared. Inflation Impact workshops between agencies
and OMB/CWPS will be held this fall.
7. Dependent Agencies. Paul Leach, Stan Morris, and
Lynn May reported that a meeting with USDA is scheduled
Yor 9/22; DOT to be scheduled as soon as possible; EPA
and HEW papers from OMB due 9/19, and will be circulated
for comment; a first paper from Labor has been received
and follow-up meetings with Labor staff to be held week
of 9/22, and a meeting with FEA will be scheduled as soon
as the new General Counsel assumes his duties.
8. Cable TV. Lynn May indicated continuing differences
between Justice and OTP. He will schedule meetings with
industry and Congressional personnel. An options paper
will be ready for the EPB within one month.
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9. Coordination. Paul Leach will circulate for comment
a discussion paper dealing with cloirence of Presidential
speeches, DCRG public appearances and press interviews.
10. State and Local. Jim Falk will deliver a Presidential
letter to Governor Ray on Sunday, after which announce-
ment of the State/Local task force should be imminent.
CWPS is holding staff discussions to help set up the
group's agenda.
LIBRARY GERALD FORD
SUMMARY OF DOMESTIC COUNCIL REVIEW
GROUP MEETING
WEDNESDAY, SEPTEMBER 24
THE ROOSEVELT ROOM
1. Truck Bill. Meetings between DCRG members and repre-
sentatives of the Teamsters Union and the trucking
industry will be scheduled for the week of September 30.
The President does not plan to attend these. It was
suggested that, if possible, the Administration should
structure these as listening sessions and hopefully
achieve some interaction between labor, industry and
the Administration. The views of concerned constit-
uencies will be incorporated into a memo to the
President laying out the DCRG's recommendations for
legislation.
2. Air Bill. DOT and Justice met with the EPB on 9/24 to
reach a final compromise on the merger standard to be
proposed in the air bill. It was agreed that the present
standard would be grandfathered for 30 months, but that
subsequent proceedings would be judged on a test patterned
after the processes and criteria used in the Bank Merger
Act. Final language is being prepared. The President
will meet with Secretary Coleman and submit the bill to
Congress late in the week of 9/30 or early the following
week.
3. Rail Bill. Although House and Senate Committees seem
likely to act favorably on some degree of reform for the
railroads, the House Committee is debating a multibillion
dollar grant and loan/guarantee package which would be
unacceptable to the Administration. It was agreed that
the DCRG ought to begin developing a strategy for com-
promising issues with Congress, by first determining what
elements of the President's bill could be candidates for
negotiation with the committees.
4. Maritime Task Force. A status report on the work of the
Maritime Task Force. was presented. Preliminary reports
will be submitted to DCRG by the end of October, a final
set of recommendations by December 17. It was agreed not
BERRID FORD LIBRART
2
to invite the FMC to participate in this stage of the
group's work, but that a more finished product and/or
legislative suggestions would undoubtedly go to the
FMC later for their comment. It was generally agreed
that the Task Force should continue to focus its
attention on FMC regulation, and defer, for the time
being at least, investigation into promotional programs
or issues such as oil cargo preference.
5. Robinson-Patman. Without a clear commitment from the
House or Senate Committees to conduct hearings, Justice
is now moving to set up regional hearings on R-P in four
major cities. The Commerce Department will assist in
making arrangements. Though no firm dates have been set,
most agreed that, if possible, the hearings should be held
during October so as not to conflict with the Vice President's
schedule of hearings on domestic issues.
6. McCarran-Ferguson. Justice has asked several States for
more information on their insurance regulations and will
be ready with a memo for the EPB within two weeks. There
was some discussion whether McCarran-Ferguson and possibly
agricultural marketing orders should be given to a State/
local Task Force as issues on which it should dwell.
7. State-Local Task Force. CWPS' participation in the work
of the Task Force is still undetermined, and firm arrange-
ments between the Domestic Council and Governor Ray have
not been concluded. A major unresolved issue is whether
the group, once constituted, should be given a package of
pre-studied issues (e.g., McCarran-Ferguson) on which to
deliberate, or whether the Task Force should try to work
through the selection and study of its own issues.
8. Kennedy-Hart Competitive Test Legislation. S. 2028 calls
for the incorporation of specific competitive tests against
which regulatory agencies would have to measure their
decisions. The Senate Committee may ask the GAO to do
some preliminary investigations of present agency practices
in conjunction with hearings on the bill. DCRG members
generally feel the concept of such a test is worthwhile,
but that different language would have to be written for
FORD & 938870 LIBRARY
3
each agency. This would involve several Congressional
Committees, and the likelihood of enrollment of such a
bill is considered very small at this time.
9. USDA. DCRG members met with Secretary Butz on 9/23.
USDA will be concentrating on reforms in marketing
orders and the procedures used for health/safety
inspections. It was suggested that the Justice Depart-
ment share its findings on marketing orders with USDA
in order to maximize the probabilities of achieving some
useful restructuring.
10. Cable TV. The House Subcommittee on Communications is
planning major hearings after January 1. The Committee
has requested Administration views. There was some
discussion of the viability of a strategy to interest
broadcasters in changes in licensing requirements in
exchange for some support on cable issues. Meetings
with industry representatives will be held--a decision
memo to the EPB will be prepared within a month.
11. Postal Rates. Paul MacAvoy reported that he disagreed
with the memo to Rumsfeld on the private express statutes
and indicated he would pursue the issue.
12. DCRG Coordination. Discussion on the DCRG coordination
memo produced agreement that Paul Leach would be
responsible for getting DCRG added as a part of the
clearance net on Presidential material on regulatory
reform. Leach will subsequently ask for and incorporate
individual views into one DCRG position. It was agreed
that a schedule of DCRG speaking engagements would be
useful. Lynn May will be responsible for maintaining it.
Margaret Earl will provide more information on desirable
events at which DCRG members might want to speak.
Appearances before Trade Associations and the NAM Con-
ference in New York during December are high priority.
LIBRARY GERALD R. FORD
SUMMARY OF DOMESTIC COUNCIL REVIEW
GROUP MEETING
WEDNESDAY, OCTOBER 1
THE ROOSEVELT ROOM
1. Truck Bill. It was reported that a meeting had been
held with The Teamsters Union on September 30 and a
meeting was scheduled with some trucking executives on
October 2. DOT will provide copies of the legislation
for them to review with comments due back in ten days.
Also, George Eads reported that the FEA analysis of
the energy consequences of the truck bill has some
strange assumptions. It was recommended that the
draft analysis be studied by CEA, OMB, CWPS and DOT.
2. Air Bill. The plans for submitting an air bill might
be running into snags because the staff secretary was
unwilling to staff the memo without a final printed
bill which wouldn't be available until the end of the
week.
3. Robinson-Patman. A meeting was held with CWPS, Commerce
and Justice to discuss the prospects of public hearings.
CWPS wanted Justice to take the lead and others believed
that CWPS would be a better forum. Mr. MacAvoy recom-
mended that Jon Rose begin doing the initial staff work
with CWPS assistance.
4. EIA. It was recommended that aspects of the EIA proposal
should be examined because they dealt with delay in
regulatory actions in the energy area.
5. Cable TV. It was reported that House hearings were
scheduled for early next year regardless of whether the
Administration submitted legislation. Some interest
appeared to be growing in the Senate also. A series of
meetings has been scheduled with interested industry
representatives to discuss alternative approaches to
the cable issue.
6. Dependent Agency Reviews. Meeting with DOT, DOL and USDA
have been held. The Domestic Council was to schedule
similar sessions with EPA and HEW. The need for follow-up
with FEA was also encouraged.
FORD is GERALD LIBRARY
7. Coordination. The press office will pull together
a list of good ideas for speeches and initial events,
including regional media briefings. These will be
reviewed by the DCRG and a plan will be developed.
8. Anti-Trust Immunities Review. A meeting has been
scheduled of the Anti-Trust Immunities Task Force for
Tuesday, October 7. Principal subject of discussion
will be reforming McCarran-Ferguson.
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SUMMARY OF DOMESTIC COUNCIL REVIEW
GROUP MEETING
WEDNESDAY, OCTOBER 8
THE ROOSEVELT ROOM
1. Broadcast Reforms. The Office of Telecommunications
Policy (OTP) briefed DCRG members on the status of two
reform initiatives. OTP is drafting legislation which
will clarify the FCC's authority to open up the largest
radio markets for greater competition between stations.
FCC is considering an experiment to test certain
deregulation steps, and OTP has encouraged the Commission
to expand the size and scope of the test. Secondly, OTP
is working to draw up a paper detailing specific dif-
ferences between it and the Justice Department over the
nature of cable TV legislation.
2. Progress on Administrative Reforms in the Commissions.
OMB staff reported on administrative improvements underway
in four commissions (ICC, CAB, FCC, FPC) and presented a
quick overview on the remaining six. Detailed status
papers were distributed to DCRG members. Each Commission
has been asked to report to the President in writing by
December 31 on the steps taken and planned to implement
the four point program discussed at the July 10 White House
meeting.
3. Truck Bill. The President has shown continuing interest
in having the truck bill sent to Congress. Comments from
the unions and industry are expected the week of October 13.
A final status report (together with any necessary
decisions) will be sent to the President for his action
the week of October 20. Submission to Congress targeted
for October 29.
4. Air Bill. The Air Bill was submitted by the President
on October 8. The Administration is working to line up
sponsors to introduce the bill when Congress reconvenes
after the Columbus Day Recess.
5. Robinson-Patman. "Justice and CWPS have met several times
to discuss plans for public hearings on the proposed
Robinson-Patman reforms. One session is planned for
FORD & 07/170 LIBRARY
2
Washington, but no firm dates have been set for that
hearing or others throughout the country. The House
Small Business Committee has expressed strong interest
in seeing any data the Administration has developed on
the actual costs to the economy of the existing R-P laws
and their enforcement.
6. Antitrust Immunities. The Administration's Antitrust
Immunities Task Force has scheduled a meeting for
October 9 to discuss positions on insurance reforms,
changes in the Capper-Volstead Act which now exempts
farm cooperatives, and other business. It was reported
that Secretary Morton plans some field hearings on
regulatory reform later this fall. The Justice Depart-
ment is talking with the Kennedy School of Government at
Harvard about a study of the effects of health and safety
regulations. A Washington conference on milk cooperatives
and their marketing orders is being organized by
Eleanor Haas for December 4 and 5.*
7. Executive Departments and Agencies. At the Cabinet
meeting on October 8, the President reaffirmed his
interest in having all the Executive Agencies achieve
substantial regulatory reforms. A meeting between DCRG
members and HEW is scheduled for October 15. EPA and
FEA meetings have yet to be set. There was a strong
feeling that the meetings should include a discussion of
the agencies' compliance with the inflation impact
procedures.
8. Maritime Issues. The FMC has written to the President
requesting him to exercise his authority to stay or annul
an ICC ruling which would subject all intermodal through
rates to filing and supervision by the ICC. OMB will
work with the White House Counsel's Office to help prepare
position and response papers.
9. Cable TV. DCRG members are scheduled to meet separately
with representatives of the Cable Operators, Broadcasters,
and Motion Picture Producers to discuss the Administration's
plans for cable TV legislation.
*Ms. Haas, formerly with the Consumer Federation of
America, is now associated with the Community Nutrition
Institute in Washington.
GERALD FORD LIBRARY
Summary of Domestic Council Review Group Meeting
Wednesday, October 15, 1975
The Roosevelt Room
1. Milk Co-ops. Bill Lilly reported on CWPS' review of the
effect of regulation on milk prices. He mentioned some
encouraging work by an economist now at FTC refuting
previous USDA studies. Since Justice, FTC and USDA are
also interested in this area CWPS will develop a plan
to coordinate these efforts. They will also summarize
the work done to date. Due 10/29.
2. Financial Institutions Act. Steve Gardner, Deputy
Secretary of the Treasury, reported on the status of
congressional action on FIA. The Senate Banking, Housing
and Urban Affairs Committee unanimously reported out a
bill which contains many of the Administration's proposed
reforms. Treasury expects floor action later this month.
On the House side, they expect Reuss to hold hearings
in February and March and committee action on a bill in
April. There was brief discussion over some of the
specifics such as the proposed 1 1/2 year Treasury study
regarding interest on demand deposits.
3. Truck Bill. Stan Morris announced we are now shooting
for submission of the bill on October 28 or 29. He mentioned
that comments were being prepared by the Teamsters and
trucking firm executives who attended the recent White
House briefings. In general, they oppose various parts
of the bill but appear to accept the fact that the
Administration is committed to its submission.
4. Fair Trade. The Senate Judiciary Committee has still
not considered the fair trade repeal legislation. It
appears that other events continue to crowd it off their
calendar. However, Senator Hruska is urging its considera-
tion as soon as possible.
5. Robinson-Patman/Predatory Pricing. The Domestic Council
has agreed to sponsor a hearing and the Justice Department
is compiling a proposed witness list. The remaining
questions are timing--either early December or in January--
and who pays for the expenses incurred. A meeting will be
scheduled with Paul MacAvoy and OMB later this week to agree
on final plans and identify the economic experts to be
asked to prepare materials.
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6. McCarran-Ferguson. Justice is drafting legislation to
remove antitrust immunity for the insurance industry and
apply the Sherman Act to private premium or commission
rate fixing activities. It will not rule out maximum
rate authority for the States. Once developed, the proposal
will be put through the normal legislative clearance
process and scheduled for EPB discussion to determine
whether informal briefings should be held with industry
representatives. Draft due in two weeks.
7. Cable T.V. A meeting with broadcast industry represen-
tatives to discuss issues on cable legislation--pay cable
and retransmission--is scheduled for Thursday, October 16,
1:30 in the Roosevelt Room. A separate session with the
motion picture industry is set for Monday, October 20.
8. Dependent Agencies. Paul Leach and Paul MacAvoy
reported on the meeting with Secretary Mathews of HEW.
Still to be scheduled are EPA and FEA.
9. Speeches and Press. Margaret Earl handed out a list of
possible speaking engagements and asked for volunteers.
She also mentioned that Domestic Councils' Fact Sheet
on regulatory reform had been printed and sent as an
Editor's mailing along with the air bill materials. The
Press Office plans a similar distribution to White House
staff and sub-cabinet officials.
10. Other.
-- Stan Morris mentioned that there is a good possibil-
ity that ACA legislation will be sent to the White
House in November.
-- Sid Jones reported Treasury's position on the S.E.C.
Rule 394 action-that this is "not the time to
change 394".
2.
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MEETING WITH DUNHAM AND LEACH
ON REGULATORY REVIEW GROUP
Tuesday, September 2, 1975
3:30 p.m.
Mr. Cannon's Office
FORD i LIBRARY GERALD
Regulatory
THE WHITE HOUSE
Refrid
WASHINGTON
ACTION
October 29, 1975
MEMORANDUM FOR:
JIM CANNON
FROM:
PAUL LEACH Parl
SUBJECT:
Regulatory Reform Letter
to Coleman, Butz, Mathews,
Vrey Dunlop and Train
Attached is a draft letter to the five key Executive
Department and Agency heads.
boto
cobinet
FORD is LIBRARY GERALD
TO:
William T. Coleman, Secretary of Transportation
F. David Mathews, Secretary of Health, Education
and Welfare
Earl L. Butz, Secretary of Agriculture
John T. Dunlop, Secretary of Labor
Russell E. Train, Administrator, Environmental
Protection Agency
Dear
on out 8
As you know, I am seriously concerned with the growing
problems posed by regulation in our society. To emphasize
this concern, I met on July 10 with the Commissioners of the
ten Independent Regulatory Commissions. Subsequently at
several cabinet meetings, I have indicated that I also
expect regulatory improvements within the Executive
Departments and Agencies.
So that my concern over regulatory reform will lead to
specific, continuing improvements in your Department
(Agency), I asked several members of the Domestic Council
Review Group on Regulatory Reform to meet with you to
discuss the opportunities for reform within your Department
(Agency). I understand that meetings have taken place
and that you will be continuing to work with the Regulatory
Reform Review Group as your Department (Agency) pursues
reform initiatives over the coming months.
-2-
Now that you have started a substantial reform effort,
I would like you to provide me with a written report on
your reform goals and plans. Specifically, by December 1
I would like to know what your Department (Agency) has
done and plans to do:
-- To reduce regulatory delays;
-- To improve the use of benefit/cost
analysis in regulatory decision making;
-- To respond to valid consumer concerns; and
-- To eliminate outdated or unwise regulation.
Needless to say, I am not asking you to dismantle necessary
health and safety regulation, but rather to improve the
substance and process of regulation. In this first
and later reports, I will be most interested to learn of
your efforts to deal with this problem which is also of
serious concern to the Congress and the American people.
Sincerely,
GERALD R. FORD