Ask the Scholar
Document scope · 1 page
Scholar
Ask about this object, its catalog metadata, its source description, or the page inventory.
For page-specific OCR and visual context, open one of the page chats.
Scholar Source Context
Document identity
localId
118564138
label
Transcripts - 10/04/1973, 10/16/1973, 11/15/1973
core
doc
dtoType
document
citationUrl
pageCount
1
Source metadata
id
118564138
contentType
document
title
Transcripts - 10/04/1973, 10/16/1973, 11/15/1973
citationUrl
identifierLocal
840
collections
Ronald Reagan's Governor's Papers of the Press Unit
Press Conference Files
thumbnailUrl
largeImageUrl
imageCount
1
hasImages
yes
source
import
hasTranscription
no
Source extras
naId
118564138
coverageEndDate
logicalDate
1975-12-31
year
1975
coverageStartDate
logicalDate
1967-01-01
year
1967
levelOfDescription
fileUnit
recordType
description
ocrSource
nara-archive
Single page context
seq
1
pageIndex
0
type
document
mediaId
8232fea0c4494d01
ocrText
Ronald Reagan Presidential Library
Digital Library Collections
This is a PDF of a folder from our textual
collections.
Collection: Reagan, Ronald: Gubernatorial Papers,
1966-74: Press Unit
Folder Title: Press Conference Transcripts -
10/04/1973, 10/16/1973, 11/15/1973
Box: P04
To see more digitized collections visit:
https://reaganlibrary.gov/archives/digital-library
To see all Ronald Reagan Presidential Library
inventories visit:
https://reaganlibrary.gov/document-collection
Contact a reference archivist at:
[email protected]
Citation Guidelines: https://reaganlibrary.gov/citing
PRESS CONFERENCE OF GOVERNOR RONALD REAGAN
HELD OCTOBER 4, 1973
Reported by
Beverly Toms, CSR
(This rough transcript of the Governor's press conference
is furnished to the members of the Capitol Press Corps for their
convenience only. Because of the need to get it to the press as
rapidly as possible after the conference, no corrections are made
and there is no guaranty of absolute accuracy.)
o00
GOVERNOR REAGAN: Welcome downstairs. Yes, Bob.
o
Governor, Mr. Flournoy said that if the Attorney General rules
that the sales tax revenue -- the uncollected sales tax revenue is
not to be counted as '73-74 revenue -- revenue, that he will feel
compelled to oppose the initiative. What will you do if that is
the Attorney General's opinion?
A
Well, if that shoul d take place I'll sit down with my legal
advisers here and figure out what it is that we want do to. I
still believe that our intent is clear. I sent such a letter of
intent and -- even so, I think the figures of today reveal that
even if that happened it would not be the great Qalamity. It might
make for an austere budget, but it certainly would not reduce to an
unacceptable level the present services. But I don't think it is
going to happen. And I think our position is very solid and I
think today's hearing -- the thing that should be made clear, and
that I hope will once and for all, is that it's been proven that under
the limitation and under this plan we have adequate money to fund the
services that are expected of state government.
Q
To pursue that just one point further, Governor, in the
discussions upstairs this morning, I don't know if you've been
apprised of that at this point, but the Legislative Analyst again
says, O. K., assuming the presumptions of the administration are
correct insofar as the revenues are concerned, that a projection of
current expenditures in the next year -- considering inflation and
those other factors that cause them to grow, but the continuation of
present levels will still leave 185 -- if I remember the figure
correctly --
A
163.
0
$103 million short.
-1-
A
All right. Again, I just have to go on the record. Now
just up until this morning his figure was $620 million dollars.
Well now suddenly his figure is $163 million. We said he was wrong
on the $620 million and he was wrong. We say he's wrong on the
$163 million. We say it is going to be about a $17 million dollars
surplus instead of a $163 million dollar deficit figure. And I
would think that some place along the line we would have established
enough credit by being right when he's been wrong that someone would
begin to suspect that we know what we are doing. He hasn't been right'
yet. He's been proven wrong every time. He now admits it is not
$620.
He now says it is $163 million.
0
No, sir.
A
No, sir, that's not quite true. He doesn't admit that.
He's saying if your presumption -- he says your presumptions are
wrong and he still says it is $620 or whatever.
A
All right.
0
But if you are right it is still $163.
ZX
He isn't really saying $620 becausehis office notified us the
other day that they themselves admitted to a $253 million dollar
mistake, so it is now $370 instead of $620. We can play this
numbers game again and I don't see why we should get into it. The
plain truth of the matter is that und er the limitation we can put a
limitation on government's unrestrained ability to tax and still
meet all of the services and responsibilities of government. And
I think frankly that what they would like to have us do is engage
in this picking back and forth on numbers of their choosing. First
of all, the gentleman has admitted that he's also left out of his
reckonings $460 million dollars of federal revenue sharing that
does not have to be onsidered under the limitation that is available
over, on top of the $550 to $600 million dollars that we say we have.
I'm not going to get into that argument with Mr. Post. Either
onhis nit-picking figures, because again -- not just on this, but
going all the way back he has been wrong in every contest that he's
had with us on figures.
O
You mentioned a surplus of, I think $600 million dollars.
What is the surplus?
A
Surplus?
0
A couple minutes ago.
A
If I used the word, I shouldn't have used that. I meant
money over and above the present spending available for addition
to the budget next year. And this is not counting some -- by next
year it will be $460 million dollars in federal revenue sharing.
ED GRAY: I was just going to say that he says it would
be $163 million dollar deficit. The Department of Finance says that
he's $180 million dollars wrong, and that it will actually be a
$17 million dollar surplus.
0
Governor Brown, Secretary of State -- I'm sorry, Secretary
of State Brown --
(Laughter)
A
And I hope -- I hope you were using two Browns with those
titles you gave me.
Q
O. K. That gentleman in a statement earlier this week said
that your own Finance Department had prepared a report estimating
the special election costs at 25.9 million, as compared to your
previous estimates in press conferences of six and a half million.
Is there any truth to that or not?
A
Mr. Brown is as wrong about that as he was about those
arrowheads on the banks of the American River. No. Any report
out of our -- I think he's referring to a letter in which the
Director of Finance was explaining how the others were arriving at
that figure. And while they were arriving at it was trying to
charge the state up analyzing -- he was analyzing the position of
local government and their position is that if everybody declares
a holiday on November 6 for all the local employees in the state
that they then want to charge the state for the salaries of those
employees on holiday. Number one, we do not believe that that
comes within the law, but number two, we believe that legally the
local government entities have the power to not grant that holiday
if they choose not to.
with
Ω
Governor, the blue pencil availability on budgets of the
Governor, why do you need this limitation?
A
I'veheard that auestion before. I'veheard that it's been
asked this morning in the hearing also. That why, if a Governor
can veto and blue pencil, why do we need any limitation, isn't that
enough. And the strange thing is that the man - not you, the
man who's making the most of that question has been a leader in the
legislature in sending down to my desk billions of dollars in legis-
lation and legislative inspired appropriations that I have vetoed.
-3-
And he has lead the attempt to override those vetoes and sometimes
has come close. The reason we need this limitation is not the fact
that the budget is now 9.3 billion dollars in spite of all our
proven economies and the fact that I have vetoed almost two and a
half billion dollars in added spending -- spending added by the
legislature, but that the budget without cut, squeeze and trim and
vetoes would be in excess of 12 billion dollars. Now I -- since
the gentleman aspires to sit in my seat some day, is he suggesting
to us that then he would suddenly change his feathers and he would --
he would begin vetoing instead of passing all of these spending
measures? He knows as well as I do that in the interchange, in
the checks and balances of the Executive and the Legislative branch
that you cannot tobally veto everything that comes down. In these
756 bills that they sent down to us in the last 48 hours, going
through these bills I have vetoed $253 million dollars in additional
spending that would have been added to the present budget, and which
would have become $353 million dollars by next year.
Now, again, he definitely had a leadership hand in sending
that spending down to my desk. Butat the same time, as I say, in
this interchange that takes place, in our systems of checks and
balances, I have signed $77 billion dollars -- million dollars worth
of additional spending.
o
Why didn't you veto the budget down to the 7 per cent
level that you wanted the expenditures held?
A
Well, because to do this just on the basis of choosing
spending that you can veto out is to try and achieve in one year
what we are counting on 15 years to do.
Q
Well, you didn't take 7 years to get down there, have you?
A
What?
0
Have you taken 7 years to try to get down to the level that
you would like expenditures held?
A
No, I have spent 7 years here in keeping the budget from
being in excess of 12 billion dollars.
Q
Governor, do you think it is fair for you to be painting a
picture, what you seem to be doing, of the legislature is a spend-
thrift organization and you are not? Irmean is that -- is that
fair to do?
A
I think it is definitely fair. I think it is fair under the
these circumstances, that the philosophical difference that has been
between us for thes_ last several years, just ppens to be one in
which there is a belief on the other side in government taking more
money. They have used as substantiation for their position now such
economists as Galbreath, who has said that the public sector should
take more money from the private sector because the private sector
does not spend this money wisely, and only government can buy for
the people the things they won't buy for themselves. And I happen
to have come into office with a different philosophy. I've had a
different philosophy for a number of years, and I've made no secret
of it. I set out from the first, and promised the people, even
when we had to have that giant tax increase, I said I consider this
tax increase temporarily and as quickly as we can begin to make
government more efficient, we are going to try to return this to the
people and the funny thing is we have. Actually, up until now, in
cuts of various kinds, in rebates of various kind, we have given
back to the people over a billion dollars. And that's not counting
the present giant surplus. When we first began to show a surplus
we began giving it back to the people. A ten per cent rebate;
a 20 per cent rebate; the cutting down of the inventory tax; the cuts
,
in bridge tolls, 11 times that they have been cut; the cut in licens-
ing fees for many of the self-regulating industries and professions;
the giving of additional breaks to senior citizens in property tax;
the cutting of thetax to give a double credit to renters, long
before Senate -- that was before Senate Bill 90. All of these
things are attempts to get back to where we were before the 1967
tax increase. And it's keeping a promise, but I think it is safe
to say that yes, when the legislature has sent .me in all but one --
in every one but one budget they have sent me back those budgets
with a billion dollars added to it in spending, and I have blue-
pencilled a billion dollars out. But we proved to ourselves over
the years -- the reason I never asked for such a thing as this at
first, never thought of it, didn't think of it this time, a task
force did -- was we believed honestby that we could by cutting
and making gobernment more efficient -- that we could eventually
get government down and reduce the percentage of the people's
earnings that was being taken in taxes. Wed we finally had to come
tothe conclusion it won't work that way. So we turned to a task
force and they turned to some of the greatest economists in the
country, scoresoof them, not just four or five of a particular
-5-
viewpoint -- and these economists came up with this proposal and
said that the only solution they believed -- not only here, they are
talking about the tax strucgure nationwide -- of the whole country,
including local government, they said the only way that we are ever
going to lickthis problem, cure inflation and keep from having a
great big economic disaster, is to reduce the percentage of the
people's earnings. Now, a lot of the confus -- let me continue the
lexture here. A lot of the confusion is because somehow, very
frankly, in the telling of this story we have been unable or you've
been unable or unwilling to -- make it plain that we are not talking
about reducing dollars that government has to spend. Government's
going to have more dollars every year. We are aiming at reducing
the share -- the percentage of the people's earnings that government
takes. And doing it in such a wayas to not disrupt government
to not suddenly have to curtail services and cut back on things
that government should be doing, but to take advantage of the fact
that every year the people's earnings increase at a rate of about
seven and a half per cent a year. And that if we can keep govern-
ment's increase within that framework so that it isn't increasing
faster, but for twenty years the -- the state government has been
increasing ten per cent a year. This is what we are trying to cure.
We don't mind government going up. That percentage each year,
that reflects the increase in -- in the total earnings of the State
of California.
Q
Well, Governor, do you -- do you have any figures on what the
percentage of the State's share of taxes has increased during your
seven years compared with the increase in earnings?
A
It has increased. It had to increase.
Q
I mean by what percentage?
A
Actually I think that the percentage of taxation when I
became Governor was less than what we want to achieve in 15 years.
But that is not quite telling the whole story, if youstop there.
If you take in what was state 'government's spending when I first
became governor, it was higher than the tax base. That was the
problem. They had finagled the books. And as I have said many
times, and you know I have reported this, they were spending more
than government was taking in. And they had stalled off the
necessary tax increase until after the election. And so we were
the ones that had to put it into effect.
O
But you say hat over the long run the cate's:takechascbeen
increasing more than personal income. What has it been during
your administration?
A
About the same. Same average. As I say, for about
twenty years, including ours.
O
It's been ten per cent a year?
A
Yes. Yes, now part of that -- I've got to be honest and
say part of this -- this should be recognized, is that one of the
things that Mr. Moretti says is his greatest achievement as a legis-
lature -- legislator, Senate Bill 90, the property tax reform bill.
We did that deliberately knowing that we would be increasing the
state budget by a billion dollars because that was a plain case in
which we lowered the tax burden of the people in one place and
transferred that tax to a broad-based state tax. So what it -- had
formerly shown up in local budgets and tax figures now was transferred
to the state.
Q
That's true of all the other the tax rebates and
property tax refunds.
A
Not all the rebates, no. No, when we gave back the ten
per cent and the 20 per cent, when we gave back and reduced license
fees, when we cut tolls over -- that is a cut.
0
- would shopw up in a budget.
A
No, when we gave the renter relief, that is on our --
that's out of our income tax.
O
Governor, I've got two questions. One is, I may have mis-
heard you, but you said two and a half billion dollars in vetoes
that you've -
A
Vetoes and blue-pencillings.
o
And then later you said a billion dollars. Is it a billion
of blue pencils?
A
Well, a billion . it works out, as I understand it, from
the figures, roughly I blue-pencilled about a billion out of budgets
and I vetoed about a billion three out of legislation.
(media)
0
O. K. The second question is, you said we may be unwilling
to report accurately your initiative. Do you have any real com-
plaints with the coverage of this and if you do, would you elaborate.
A
No, maybe I shouldn't have said that. I -- I get a little
irked at times by the manner of campaigning against this particular
program. And I'll apologize, I shouldn't have said that to you.
Let me just say we have been unable to get through our message to
the people that we are not seeking to reduce in dollar amounts the
budgets that California will have in the future, having the budgets
godown from the present locale. We admit frankly the budgets are
going to continue to go up. Every year is going to be a record
budget. We are simply seeking to reduce the perdentage of your
earnings that we take in taxation.
Q
Why do you -- you haven't been able to get the point
across
--
A
What?
O
Why do you suppose you haven't been able to get the point
across?
A
I would love to have the counsel and advice of any of you
gentlemen who deal with the communications media to tell us how
we can --
O
Governor, instead of anwering all these questions here, why
(tas)
don't you debate the issue?
A
What?
Q
Why don't you debate any of the members of the other side?
A
Because I don't think that would bear any fruit. A legiti-
mate debate on this -- you don't have to debate someone face to
face in this. You appear before the same forums, they have
appeared before ours. Even last week they stacked a few people in
our audience. I have done question and answer with audiences to
state what this problem situation does. Now what would happen in
a debate? They would make their same charges, just as Mr. Post
has done this morning before the committee. And they'd say,
"Tain't so." Well, the audience would be left choosing, well,
who are you going to believe, which is the same position they are
in now. I claim, however, that we do have figures to substantiate
our claims and projections. What I would like to ask the other
side is will they tell us that 45 cents out of the dollar is -- do
they think that is too much or not too much for government to take?
And if they don't think it is too much, will they tell us at what
point it will beame too much; at what point will they decide that
government's ability to tax must be limited. And if so, will they
then tell us how would they go about that. Other than the way that
we are choosing to go
Q
Why don't you ask them that?
A
I have repeatedly.
0
Governor, the $600 million dollars figure that came out
today, Mr. Orr tells us this morning, rests on three assumptions.
Now those three assumptions are debated and rebuttal perhaps, and
so far your administration doesn't even have an Attorney General's
opinion tosay that your assumptions would hold. Now the question
is, doesn't that require a -- quite an act of faith on the part of a
yew voter?
A
Well, no, since the yes voter is not giving any power away.
He holds the power within his own hands. The voters can vote any
time they want to, to spend money over and above the limit for any-
thing that they think is desirable.
Q
I'm sorry, the point is, suppose those three assumptions
ultimately fall. A voter --
A
I don't know just what three assumptions he made in there.
I know that we --
Q
It deals with revenue base. Vern Orr --
A
All right, he deals with the revenue base. Now, first of
all, we think we are on very solid ground. Our own legal advisers
think we are on very solid ground. First of all, we are the
proponents and we use the tax base income and sales to return 720
million dollars in surplus. Now we put into the initiative that
the rebating by way of the income tax cannot be considered an erosion
of the revenue base. The only -- and Bob, you wrogethis in an
article the other day, and I wanted to look forward to meeting you to
say that you found the -- why did we not put into the initiative
the same provision about the sales tax, using the sales tax. But
we couldn't. Because we wae doing that at a time when the sales
tax was slated to go up on July 1. We are talking about a
November 6 election, and that's why the sales tax rebate portion
had to be passed by the legislature. If we were going to try to
delay its imposition on July 1. And so we couldn't put it on the
initiative. But we wrote the letter of intent just as we put
this in the initiati e, we considered that the use of the sales tax
was no different than the income tax. And we think that this is
so logical, so right, and that the proponents having expressed
their intent that this is normally what is taken. Now, let me
point something else out. The legislature could resolve this issue
at any time they wanted to. The legislature could make one -- pass
one simple bill that would take this out of the area of argument
-9-
and there would no longer be any controversy except that they
evidently want to use this as a weapon against the passage of the
initiative. And yet if the initiative passed and they thought that
there was going to be an erosion of the revenue base, they'd be the
first ones then to want to put that revenue base back where it was.
Now the simple change, all they have to do is pass a piece
of legislation and say that the sales tax penny that we are replacing
is the local government's share, of the sales tax. Their penny.
And they have that power any time they want to. But this has become
for them a weapon to try and confuse the people into voting against
this initiative.
0
Governor, you said your legal advisers
support your
position on the revenue base. Have you sought an opinon from the
Attorney General's office?
A
Informally. We spoke to the Attorney General. He's --
you know, the Attorney General -- others -- like the legislature
asked for a legal opinion and we spoke to him because -- the Attorney
General is the Governor's lawyer. And we spoke tohim about this.
We knew that he was going Sorward on this and studying it.
We
didn't formalize it. We had spoken to our lawyer and he was look-
ing into it. Then the other two requests were made, formal requests,
there was no need for us to FROM to addours to it. We had already
spoken and said we need to know --
O
And what did they tell you?
A
What?
C
What didthey tell you?
A
They are working on it. We are going to have an answer
in about a week. By the 12th.
ED MEESE: You know lawyers, they are not very quick.
Q
Governor, you have said --
Q
Governor, aren't you going to be in trouble trying to get
a yes vote when there is so much fonfusion over this blame thing?
A
Well, Square, the plain truth of tle matter is the fellows
upstairs who are against this made it plain at the beginning that
this is what they were going to do. They said, if we can confuse
the people enough they will stay away fromthe polls or vote no.
And this is what they are trying to do. And this is why I'm not going
Alan
to get into that number picking game with Allen Post. I
think
Allen
Post's testimony and that of some of his staff in several of the
committee meetings put down verbatim and ana. zed reveals,
frankly, they don't know what they are talking about.
0
Can we go on to another subject, Governor?
A
Wait a minute, we have a visitor in here.
Q
As someone from out of state, this is a little Confusing, but
(tas)
did you say earlier that the task force that worked out the plan
had been gathered from all around the country?
A
Yes.
O
And that the same formula that you believe will work in
California ought to work in other states, ought to be applicable
nationwide?
A
Although I'm not sure that every state requires -- there
are some states that have -- are very low taxing and the difference
between how much they support their local governments -- no two states
are the same. Your big industrial states, like California and
New York and so forth, have a pateern developed where much of their
taxing or tax revenues are returned or redistributed to the cities
and the counties in their state. Inour state it is two-thirds of
our budget.goes back to local gobernment, and our state also
happens to be one of the highest tax paying states. The Economic
Council in Washington has said that last year the total share of
government was -- of the people's dollar was 43 and a half cents.
Now that's the national áverage. But because some of those states
are lower, when you come to California it is a little higher than
that, it is 44.7, and so I would not -- some states may not need
this. I know that a number of states are making inquiry of us.
Some states have put this on the agenda for constitutional revision
conventions they are holding. One state has ordered its legisla-
ture to -- committee of the legislature to come here and study this
for their problems. But when I say nationwide, certainly you
wouldn't pick out some -- let's say more or less rural state that
has not burdened its people this much.
0
Are there states that would not need it?
A
There could --
2
Would not benefit by it?
A
I'd -- I wouldn't be -- I wouldn't want to be in a position
ofmaking a blanket indictment that all 50 states are --- are taxing
to the excess that I think we are.
2
I see.
Thank you.
-11-
0
Governor, before I go on to another subject I'd like to
answer a question. You wanted to know why you can't get your
(tax)
story across.
A
Yup.
O
Well I tell you why, frankly, maybe it is very important,
but it is also a very dull story to most people. They won't go
beyond one paragraph in a newspaper, beyond one minute on a radio or
three minutes on television. O. K., now can I ask my question?
A
Yeah.
I mean do you agree? It ismost people don't care.
A
Well, the only thing that I think is exciting about it is
that for the first time in history we have actually promised the
people something that can begin instantly, begin a series of tax
reductions. You know, you won't wait 15 years for the tax reduc-
tion. For example, if this is voted in the first year probably
the -- the seven and a half per cent income tax cut will take care
of that first reduction, but by the second year you are accumulating
another surplus. Each year a surplus is accumulated which cannot
be spent in any way except giving it back to the people. Now, we
know that in five years those would total enough for a full one
cent cut in the sales tax or 25 per cent cut in the income tax.
But you don't have to wait five years. As you accumulate - after
this first year some surplus, you can then project and say, cut
the sales tax a half a cent. In about two years --and in another
two years you can go the other half, and you've got the cent. You
can keep on going because in ten years under this limitation you
can cut the sales tax by two cents or cut the income tax 60 per
cent. If you wanted to use the sales tax, you could keep on going
and about every two years you could have another half cent cut in
the sales tax asyou go on down through the 15. At the end of the
time you would have had a total cut in the tax burden, not the
income tax, not just the sales tax, in the total burden of taxation,
you would have had -- you will have achieved about a 20 per cent
reduction.
0
Can I ask my question now? That was my statement. Do
youthink the gasoline dealers in California should be given an
increase in their gasoline price?
A
I've been so busy trying to give the people a decrease
Ihaven't paid as much attention tothat as I should. I think that
we are going to hav to face the day very quic 1y when we let the
market settle that. I think the -- the inflation problem in the --
Q
But the market didn't settle the wholesale price.
A
What?
Q
The market did not settle the wholesale price.
A
Well, I haven't followed, as I say, all the details of
this, what the controversy is about, but I just don't think you
can ask any level of business to sell a product and take a loss.
Q
That's what the government is asking.
A
Well, you perhaps know more about it. This seems to be
what they are protesting and, as I say, I haven't - I haven't had
time to be reading on this.
O
Governor, on another subject. Can you explain why you
signed the Moscone conflict of interest bill, disclosure act, when
you yourself have refused to disclose your own financial statement?
A
Oh, no, he did what I have always believed is a proper kind
of disclosure act. He did not - he did not pass a bill that said
that everyone has to lay out his entire record and everything that
he owns and possessed to government. He only said that above
certain amounts you had to state if you had above that amount in
anything that might constitute a conflict of interest. And I have
always agreed with that. I'vealways sai d that should be the kind
of disclosure law. Whatever you set the figure at. If you think
that someone owning more than $10,000 of a certain business or --
O r tax would constitute a conflict of interest, then you have to
state that you have more than that amount, if you have it.
You don't have to state how much more, youjust say, "I have more
than that amount." Then decision can be made as to whether you
should be prevented from participating in any decisions affecting
that business. No, I was -- I was satisfied with the terms of
this.
Q
And regarding your own -- can you explain your own refusal
to issue a more detailed statement on that?
A
Because I still don't agree with the setting the precedent
that any segment of our society has to come in and do what we fought
a Revolution for. As you all have a right to be safe in your
books and records, which is what the Declaration of Independent was
all about. And I don't see any conflict in this kind of a -- in
-13-
this kind of a measure. But previously they were demanding
such statements as total statements of everything that you owned
and I thought, and I still think, it would drive a great many men
out of government. We have seen in Washington where the -- the
State of Washington, where they had a man, when such a thing was
passed up there, that thisman had been giving at a dollar a year
his services to government for a long time as a kind of a civic
contribution. And faced with this disclosure he said, "I'm a
business man, I won't do it. And so they are going to have to get
someone else. And I bet they don't get someone as clever.
Q
Governor, according to the Board of Pharmacy, you vetoed
a bill carried by Assemblyman Ingals that would have transferred
the possibility for a two-year old drug surveillance program from
the board to the Bureau of Narcotics Enforcement.
A
Yeah.
The Executive Secretary of the board said he figures that
perhaps there was some mixup there in the last flurry of signing and
vetoing legislation and figured you may have made a mistake. Have
you heard from them or -
A
No, we don't, and he's right, there is a possibility of
what
that.
This problem of/the two-year session was supposed to cure
has not been cured. They handed down 756 bills in 48 hours. This
particular measure, the program -- this control measure has just
started and even though the board itself was willing to relinquish
this and advocated changing it over, we felt that where it has just
started we would keep it at least until we can see how it is working
and what's going to happen in the Pharmacy Board instead of trans-
ferring it to the Justice Department.
o
Governor, along those lines. Are there bills that you
vetoed this time around that you perhaps may not have had you had
further time to study them? And if so, could you name one?
A
You -- let me -- you can't pick them out, but let me just
say you live with that under such a thing as we have been through.
Noe once upon a time -- we always had the big rush of bills, we
had 30 days. Suddenly, under their changes of rules, it was to
eliminate the rush of bills, we had the rush of bills and only 12
days in which to studythem and you found yourself ++ in the past --
let me just give you an example. In the past you'd come to some
bills sometimes and the whole -- the staff, the department heads, the
cabinet, were all their in meetings on these various bills -- and
-14-
and they are not easy, in many of them you can find right and wrong
in all of them, and you -- it is a large gray area. And many times
we would have the leisure to say after we debated if we weren't
satisfied with the outcome of the debate -- say let's put this one
aside, let's come back to this again Tuesday and we'd go on with other
bills. Andsometimes you'd find that your mind had changed from
leaning toward sign or veto the other way. We didn't have that
luxury this time. So yes, I think all of us live with the thought
not only ofveto, but of sign. Did we sign bills that if we had
had a longer time we might not have signed? We did our best.
I can't think of anything right now that I would say to you we made
a mistake on that one. But as I say, it is just a fear that you
live with. When you are handed that kind of -- and the fact
that those 756 bills were not getting any consideration on the floor.
You didn't have hearings and debate to refer to, as part of the
evidence on them. When you had the situation of a legislator
warking up and down the corridors trying to solicit votes for his
bill, and he had to tell him his bill had already beenpassed two
hours before, you have an indication therewas a little confusion
going on up there.
Q
Governor, you've been relatively vigorous in supporting
Vice-President Agnew in his time of troubles. Do you think that
the President could be more vigorous in his support of Mr. Agnew,
as some Republicans apparently feel?
A
Well, no, I thought -- I think we have bothbeen about the
same.
I have just repeatedly said I have always known him, thought
of him as a man of integrity and honor, and have simply said, as
the President did, he'd been accused -- nothing but accused, and he
certainly has the right to -- the presumption of innocence until
proven guilty.
o
Governor, back on the initiative. Do you think if it
passes it will diminish legislative discretion as far as spending
goes?
A
No. We have taken none of the legislative prerogative
away from them. We have put into the Constitution something that
I think is inherently written, the spirit of the constitution.
And I think the only reason itwas overlooked was because many years
ago it was not a problem, taxation, in this little beginning
country of ours. And up until just -- relatively the last few
years it becomes. so burdensome that it became on economic footor
in our whole enterp se system. The thing whether a government
can take virtually half of the people's earnings. And what we
have said in the constitution is just as the constitution gives us
the right to tell government it cannot confiscate our property
without due process of law, that we are saying part of that property
is the fruit of our toil. And that we demand a right above a
certain level to say that government must get our permission for the
spending of that money. That -- with all the confusion that very
simply is all this is. And that's what could have been on the
ballots if we could have depended on the legislature to implement
it.
We had indicates that they wouldn't. So we had to put it into
the complicated language of making it a full constitutional amend-
ment, closing all the loopholes, plugging all the places where
one might try in the future to get around it. The legislature
has the ability to change the tax structure, to make the tax
structure fall more heavily on one segment of society than the
other if it chose, to close anything they findmay be a loophole
so long as the level of taxes do not go above that limitation, and
the legislature has lost nothing. We have to one extent we have
limited them, and yet it is within keeping of present legislative
customs. Having done this we said that we felt that it should
require a two-thirds majority vote for all taxes instead of just
part of the tax burden. And to whatever extent this may limit
them, but that is in keeping with the fact that they now require
themselves a two-thirds vote to appropriate money. They require
a two-thirds vote to pass the budget.
So we have said it will
take two-thirds vote to change the tax.
SQUIRE: Any more questions?
Q
Yes, Governor,
The unlimited power to tax and spend is
a -- is sort of a fundamental legislative prerogative. Some
people say that's what we fought the Revolution for or the Revolu-
tion was fought for.
(Laughter)
A
No, it would seem to me if you -- ifyou look at it, we
fought the Revolution, which was a philosophical revolution, not
the usual kind of throw the rascals out -- we fought a Revolution
that for the first time in history really said that the people are
the source of all governmental power and thatgovernment can have no
power except that power granted by the people. And down through
-16-
the years we have amended the constitution a great many times,
when we found areas in which we thought that the people needed to
reassert this right and to make a decision. That's why we have
provision in our law for changing the constitution. It isn't that
we are doing some horrendous thing that has never been done. The
legislature puts constitutional initiatives on the ballot all the
time, and in this instance we are simply returning to the people
the right to say there is a limit above which you cannot go without
our permission in taxing us, and we are saying that because the --
now we have reached a point of real critical danger. We have
reached a point where government is taxing at a level that no govern-
ment has ever beenable to survive.
SQUIRE: Any more questions?
Q
Government survived at higher levels of taxation in Europe.
A
Not very long. Governments that have reached the history --
if you go back we will go through history, and I was -- at the
present, because I don't know how long it will last - if you go
back through history you will find that about 25 per cent of
people's earnings taxing governments had begun to crumble, and by
the time they reached a third they have collapsed, and the society --
the civilizations they represent have disappeared.
O
To carry the revolutionary theory one step forward, are
you saying the people are being taxed without representation?
A
No. They elect the representatives. I am saying that
this -- we have got to decide something now, whether we really
believe in government by the people. We have got to decide whether
we believe that we can entrust to government unlimited power in any
numberof fields and in particular this one, or whether we will
remind ourselves that government can do only those things which we
permit it to do, and it cannot do anything that we have not specific-
ally allowed it to do. The constitution spells out that everything
that is not granted to government remains in the hands of the people.
Q
Governor, you deleted $60,000 from the new judgeship bill.
A
What?
2
The new judgeship bill in Shasta County, the Superior Court.
Would that be the policy of your administration for any new future
judgeships, to not support the county in -- you know, they are
having SB 90 problems.
-17-
A
I'm going t have to ask for help becau this is one I'm
trying to remember the situation with regard to.
ED MEESE: It didn't delete $60,000. It deleted $53,000
out of $60,000 that was appropriated on the basis that new judge-
ships when they are approved by the local Grand Jury and the local
Board of Supervisors are not an increased level of service or a new
program under SB 90, but are merely a work load increase. On that
basis we left in the bill the regular appropriate for status
historically made for judges.
o
Governor, Mrs. Helen Bentley, Chairman of the Federal
Maritime Commission has criticized you for not appointing any women
to policy-making pesitions during your sevenyears in office.
What is your repponse to that?
A
Well, have you met the young lady that is the head of our
Rehabilitation Services? I think we have -- I don't think Miss
Bentley -- perhaps if she'd come in here and I'd be very happy to have
Ned Hutchinson provide her with a list of what we have done. When
we came into government we were surprised at the lack of minority
distribution, not only where women are concerned, but with regard
to ethnic and ratial groups. Again, among our employees.
And we set out to rectify this and we have made quite significant
gains. And we made them under one great difficulty. It wouldn't
have been so hard to even this up if we were still hiring an
additional 5500 employees a year, as has been going on for the
previous several years. We set out to hold the line. So we recti-
fied these imbalancesand raised the percentage at the same time that
we have held the total numberof employess virtually even with what
we had seven years ago. And this does curtail some of the things
you want to do. But I think you will find that we have made a
great many appointments e- she would find a great many appointments,
not only in our staff, but here in various departments of government.
And another thing that she perhaps doesn't understand is that
California has a commission form of government. We have a great
many commissions and she would find that there is a pretty sizable
sprinkling of the fair sex among those commissions, but I think
that the answer to that is to have Ned Hutchinson send her a letter.
O
Has there been one department head or one cabinet member?
A
We don't have a woman cabinet member, but we also reduced
the cabinet from 8 to 4,
Q
In the department you have about 40 department heads.
-18-
Department Directors.
A
Well, I know we have the one, this young lady --
ED MEESE: Deputy Director.
A
She is Chief Deputy Director of Rehabilitation.
0
Governor, on another subject, Los Angeles gas dealers are
closing tonight, apparently for three days. Now you are certainly
familiar with the problem in Los Angeles, where you live by vehicle.
Bearing in mind what Bernice asked you earlier, what is your
(gas
Beaction to this technique used by dealers in closing down,
especially in a comjunity like Los Angeles?
A
Well, I hesitate to answer because, as I say, in these
last few days which I've beencommuting back and forth, I haven't
evenhad time to keep up with Peanuts. I - I just -- I'm not
familiar enough with where the argument lies now. And so I
answered in the broad sense here. I still believe in a marketplace
and believe that no one should be asked to sell something at a loss.
Q
There are a couple of cameras rolling there in the back,
Governor.
A
All right.
C
Governor, about a week and a half ago, after you signed the
death penalty bill, you told a group of high school students right
here in theroom, I believe, you thought thise might be a time to
bend our thoughts to more humane means of executing people. Is
that just an idle comment or do youintend to pursue that thing?
If so, how do you perceive the best way to do it is?
A
It was somewhere in between. It wasn't-as those of you
who were in the room know, we were having kind of a philosophical
discussion. The young people were disturbed, as I was, at their
age -- I was against capital punishment what this reinstatement
was, the rights and was it a deterrent and so forth. And in a
general discussion I told them -- I recalled the history from
capital punishment, and from the time that man finally outgrew tor-
turing other men history indicated that efforts in every civilimation
had been made to make the manner of execution more humane. And
I -- I simply voiced the idea that we shouldn't think that that
has ended. That the world has moved on in many ways, and that
it has been believed that the most instantaneous death possible
has been either the electric chair or the gas chamber, and that is
what we mean by humane. Instantaneous as nearly as possible.
And I said perhaps h
should persist and carry
now that further
study. Now I remarked this to our own people. I didn't demand
or set up a task force to study it. I said is this something -
isn't there something that we perhaps should look at, and see is there
a better way. Had we moved on to where there is a better way than
the gas chamber.
2
Is anybody looking at that now formally?
A
I think so, yes.
or
Who?
A
Well, I would think Dr. Brian, some place the Department
of Corrections.
o
Governor, now that the legislative year is over could you
single out the most -- the greatest legislative victory for you this
year and also the greatest disappointment as far as your administra-
tion is concerned?
A
Well, I was disappointed that the legislature wouldn't
be broad-minded enough to put this initiative on the ballot as they
could have without making us go to the -- tothe petition signing
way. Because it didn't mean they had to agree with it. They
calld still oppose it and fight it. I've signed a number of things
that they have sent down to me to go on the ballot that I later
campaigned against, but I said I recognize the right of the people
tovote on this. So I will make it possible. I'll sign it and
make it possible. The greatest - greatest break I can think of,
just offhand, in legislation, was the fact that they finally decided
that they could suspend the sales tax one penny for six months and
give back $400 million dollars in income tax rebate. That we
didn't spend $720, we are giving it back to the people.
SQUIRE: Thank you, Governor.
000
-20-
10/16
PRESS CONFERENCE OF GOVERNOR RONALD REAGAN
HELD OCTOBER 16, 1973
Repar ted by
Beverly D. Toms, CSR
(This rough transcript of the Governor's press
conference is furnished to the members of the Capitol Press Corps
for their convenience only. Because of the need to get it to the
press as rapidly as possible after the conference, no corrections
are made and there is no gauranty of absolute accuracy.)
GOVERNOR REAGAN: Good morning. We have some
visitors with us here, the University of California Berkeley
journalism class, and instructors, Stanley Sesser (phonetics) and
Richard Reinhardt. Happy to have you here. Everybody now be
on your guard. I have today -- I have an opening statement, I
have a letter that I would like to read to you.
(Whereupon Governor Reagan read press release No. 537.)
o
Governor, how to the businessman who receives your letter
to determine whether there's been a violation of law? (Proposition
A
We are asking our emmissions - this letter of ours is
going to our commissions, and our superintendents of banking.
or
Wouldn't that be a subject for the Attorney General?
A
Well, then maybe we will take it to the Attorney General
if they determine this.
o
You say "further attempts to utilize corrupt practices and
intimidation. Are you therefore -- their further attempts, now
what does that mean? Are you directly accusing someone of corrupt
practices and intimidation? Or just to investigate?
A
Where are you?
o
Your last sentence.
A
Well, I'm telling ours that we want this investigated,
whether this is true, and we want any further dissemination of false
information by the Assebly leadership, any further attempts to
utilize corrupt practices and intimidation can be prevented if
they should be ruled that they are corrupt practices. Certainly
they are intimidation. They have been so labeled by the recipients
of the letters.
Q
You also say that the spurious reasoning of the legislative
analyst has now been shown to be incorrect. Do you -- does that
-1-
mean you have the At-orney General's opinion on whether the state
revenue --
A
We are talking about the testimony by the Finance
Director. And again I rely on our - on our figures.
Q
Well, there is still a difference of agreement. But how
has one person been shown to be correct and the other not correct so
far?
A
Well, Bob, I think that it is very apparent. We, as the
proponents, of the measure, have stated what we intend the base of
revenue to be. It is our proposal. Our measure. And we have
stated what is the revenue base that is to be used in computing the
reductions intaxes over the coming years, for government spending.
And we have given the figures that refute his figures that we are
going to have to cut spending $620 million dollars, and have stated
that we are going ahead with budgeting to -- based on the potential
of raising the budget as much as $600 million dollars, in the coming
year.
Q
Governor, in spite:of of what you state to be the revenue
base, isn't the revenue base ultimately up to the -- the commission
on economic estimates, whatever it is?
A
Yes, I think --
MR. ORR: It could well be, that may beone of the things
that the Attorney General will rule.
A
Yes.
Q
Governor, do you have any firm basis to believe that
there might have been a violation of the law by the per son who wrote
this letter?
A
We wouldn't have sent this letter if we didn't believe -
Ω
Can you state what your basis --
A
What?
Q
Could you state what your basis is for that belief?
A
The basis; to pick out of the clear air and send to these
specific organizations a letter that suggest to them that if this
measure passes on the ballot the legislature might find it necessary
to cut the budget for all the regulations -- state regulations of
their particular industries, and thus further indicating that this
would then leave such regulation in the hands of the federal
government in Washington, which I'm quite sure none of these particu-
lar industries would enjoy or look forward to.
Q
I don't understand what state law has been violated.
-2-
ED MEESE: There's several code sections, Governor.
I'll be glad to talk with anybody after who wants to get the exact
provisions.
A
See my lawyer.
Q
Well, Governor, you are making the statement, do you know
what laws are being violated?
A
Yes, I've been told about them, but I think rather than
to enumerate -- I can't enumerate them off the top of my head right
here, but the code numbers and the numbers can be given to you.
Q
Governor, why didn't you go right to the Attorney Goneral
if you believe the law has been violated?
A
Because we are turning this over to the proper agencies
to find out first of all how many of these letters were sent to
what all financial institutions. How widespread was the mailing.
Q
Governor, when you send these letters - I presume your
own regulatory agencies in determining how many businesses have
received this kind of information, would they not in turn be sending
a letter of their own and would not those letters presumably --
conceivably be considered cumpaigning on the other side of the issue?
A
I don't think it is campaigning. We are trying to find
out how many have received these. What's campaigning. I don't
they
think WIS are going to put a pamphlet in their letter that extols
Proposition 1.
Q
Wouldn't you be surprised if they didn't explain that the
first letter was inaccurate and wrong?
A
I don't know how they are going to go about it. They
might even pick up the telephone and call.
o
Speaking of which, what's the difference between an Assembly
committee doing this and the Governor or the Committee telling
people that their taxes are going to be raised if Proposition 1
does not pass? I mean I don't quite see the ethical difference
here.
A
Well, I think there is a very great ethical difference.
Those who are opposing this and saying that Proposition 1 is un-
necessary are the same ones who would have had a budget in excess
of $12 billion dollars now had it not been for the governor's vetoes.
As a matter of fact, those same individuals sent down to my desk
$253 million dollars in spending which would have necessitated an
immediate tax increase had I not vetoed them just within the last
few weeks.
0
Yes, but that -- Governor, isn't that difference in
political philosophy, which is certainly an acceptable - rather
than a -
A
But he's suggesting -
Q
- criminal law --
A
He's suggesting that in some way it is false or dishonest
of me to suggest that there can be tax increases if we do not have
some form of limitation, when the historic pattern going all the way
back reveals that there will and have been and there are continuing
efforts now to increase spending to the point that tax increases
would be necessary. I think I'm stating a fact.
Q
Agreed. I don't think anybody could argue with the fact
that taxes have gone up and perhaps will continue to go up, but
isn't -- aren't there two valid political positions or phisosophical
positions or whatever you want to call them, on an issue such as
this?
A
oh, Tom.
Q
There are those people who like it and those people who
don't.
And if they don't like it and campaign against it are
they necessarily --
A
No, Tom, you just made my case. I would have no objec-
tion - I'd argue with them, but I'd have no objection if our
opponents would meet us out in the open on what is their basic
philosophical disagreement with Proposition 1. And basically
their disagreement is they don't think taxes are too high, they
don't intend to hold taxes down. They want more taxes for more
government spending. And this, in private discussions, they have
openly admitted. But when they speak to the public they say,
"8h, we are against high taxes, too, but we don't think this will
work." The real reason they are against Proposition 1 is they know
it will work.
Q
Governor, yesterday you finally agreed to have a semi-
debate with the Speaker and today you are attacking the obscure
Assembly committee chairman. Are you panicky on the prospects of
Proposition 1?
A
No. If you were referring to the -- to the fact that
the Speaker and I are going to appear on the Advocates program the
end of this month, no, I know that program. I'm familiar with it.
I not only have seen it a number of occasions, I've been on it
before. And when it was brought to our attention -- as a matter
of fact, they came to us and said they wanted to do an Advocates
program on Proposition 1, which surprised me somewhat because
Advocates is a natio. wide program, and asked if I would be one
of the four witnesses. Knowing the format I said yes, and at
that time I - I said, "Have you thought about the other witnesses?"
"And could I suggest the Speaker of the Assembly," because knowing
the format I was perfectly willing to be on thas program, in fact
look forward to being on with him, and they told me they had already
thought of that and were inviting him. And I accepted on that
basis. Because the format, contrary to what Ithink they had in
mind as a debate -- the format of the Advocates permits questioning
and cross-examination of the four witnesses within a ffamework in
which I think facts can be brought out which wouldn't just be brought
out with a dual presentation of -- our case for and the case that
so far they have made public against.
0
In other words you won't go out further, for example,
on a debate where you and Speaker and say a panel of newsmen asked
some questions? You don't consider that an open debate like you
just said?
A
I told you, I've never closed the door on such formats
here and I don't know what the committee is - is talking about in that
regard. I'll review each one of them when it is presented. My
objection up until now was I was not going to help get audience for
those who were simply going to go and give the same attempted
confusion that has characterized the campaign so far; The same
charges of - and predictions of what they say might happen if
this Proposition passes instead of dealing factually with what
is inthe program. And so I'll deal with each one. I thought the
Advocates gave us a very good chance for that kind of an exchange.
Q
Governor, part of the campaign in behalf of Proposition 1
has been that by placing a limit on revenues and expenditures it
will cause the government in the future to - the legislature and
the governor, to reassess priorities and re-adjust priorities,
perhaps as this thing gradually winds down over the years.
What do you see at this time -- I think some of the voters would
probably like to know -- what do you see as a possible reassessment
of priority? How - what do you think should be reassessed as far
as priorities in spending are concerned?
A
Well, Tom, I think to get into those specifics -- I
wouldn't know or wouldn't be able to predict. But what I can say
-5-
(Prop.
is that I think what we are talking about is to base every
spending proposal on the idea of its worth to the people. Is it
worth the cost and if it is one that necessitates going above that
limitation in taxes, then the people would have to be asked with
regard to their approval or disapproval of it, as against the pattern
that is developed of log rolling. In other words, the priorities
are not chosen today. If you have got two spending measures here,
the whole legislative process has evolved in the "you scratch my
"
back and I'll scratch yours and we will have both spending measures,
and this is how government has grown without any attempt to assess,
arethey really necessary. And are they of benefit to the state
as a whole or to all of the people.
Q
Let me put it this way, do you think that the spending
program that exists today -- that the priorities are just accurate
and the way they should be, or do you think they should be readjusted
somewhat?
A
Well, I think they are due to cut, squeeze and trim
down through the years. I think they are closer to that than at
any time I can recall in California. But I'm not going to tell you
that it is all perfect. There are undoubtedly programs that are still
maintained on the basis of - of just political realities and
political power. I'm never going to be satisfied that no matter how
till
much cut and squeeze and trim we do XX all ofthe fat is necessarily
out of the things we are doing. There are two ways that you reduce
spending. One of them is to totally eliminate programs as being
unnecessary or not worth the price, and the other one is to say,
well, we are satisfied with the programs but we believe they can be
run fore efficiently and more economically. That is basically
what we have been doing over these --- these many years. I no uld
think that in the years ahead, in establishing priorities, they not
only would compare new spending proposals to each other, but I would
think that the legislature would be far more in keeping with what
a legislature should do. The representative government would be
strengthened in that they would find themselves reviewing programs
that are presently in effect. Things that have been adopted in
the past, and weighing them against probably new ideas of spending
and saying, is this worth continuing? Are we getting the benefit?
It would subject them to a cost analysis that -- I think would be
-6-
beneficial to the people.
Q
Governor, by your own figures your proposal will cut
$18 billion dollars a year out of a future budget. Now, with a
cut of that magnitude you must have some vague idea of what areas
you want to trim down on.
A
No, and this is the thing that the opposition ignores,
and that I'm afraid too many people are ignoring. There is a
fail safe system built into Proposition that government cannot
fall below the present level of government services adjusted upward
for growth and inflation. How, this does not mean that a legisla-
ture will continue to say everything we are now doing just be done at
this present level. They may ven well determine that some program
is no longer needed. But that money is then available under this
program for spreading around for other for whatever else they
want to do. Under our projections we believe, and I think we are
very sound in this because I think wehave been conservative in all
our figures as we were in welfure reform and all the other things
in which we were proven right
we believe that about three-fourths
of the mo ney available for the increase of the budget each year is all :
that is required to maintain the present level of services, and take
care of the work load increase. That one-fourthcf the additional money
each year for the budget, roughly one-fourth will constitute money
available for new spending if they should so - the legislature
should so choose. That it will be available for new programs
and new ideas.
O
New subject, Governor.
a
No, no, Governor. Have you run into recent --
A
I have a hand ahead of you back here then.
o
I wanted to go to another subject.
A
He wanted to go to another subject. I'll take the
genteeman over here.
Q
Governor, have you run any polls on Prop. 1 and how are
you doing?
A
Have we run any polls on Prop. 1?
2
Yes.
A
I thinkthe committee has been having some tracking surveys.
repeatedly
I've said 6-I think it is a neck and neck race. No question about
that, we are campaigning as hard as we can.
Q
Are you behind then?
-7-
A
No, I don' think so.
Q
Are you ahead?
A
I still think we are ahead. But it is -- it is a close
race, and I have predicted this from the very first. I said when
the tax spending and special interest groups start rolling, when you
stop to Think that the two high-spending lobbying groups in Sacramento
are the California Teachers Association and the California State
Employees Association, and those two have contributed a couple
of hundred thousand dollars, according to the reports, to this
campaign to defeat this - no one can be sanquine and sit back and
think this is a shoe-in.
Q
Governor, are you saying then that you have lost ground
over the past few months?
A
No, only in the sense that --- only in the sense that
yes, if you could have voted on this the first day it was proposed,
1 ike so many things I'm quite sure there would have been no question
about how it would have come out. I think it is running and continuing
just exactly as I -- as I thought that it would against strong
opposition. Those who sup at the public trough do not look lightly
upon efforts to reduce the amount of sustenance in that trough.
Q
Governor, you describe that the Assembly committee -- well,
you used the words, blatantly started a false and strident campaign.
Why should those words not apply to your comment yesterday, the
economic situation in this country is bordering on the condition that
led to Nazi Germany.
A
What was wrong with that? I used it as an example
in talking about inflation and I talked about inflation -- what.
coul d happen if inflation ran its course and nothing was done to halt
it. And I cited the example the most recent modern example
we have was Germany, not Nazi Germany -- it was Germany after World
War I, and I remember as a boy myself having 50,000 marks, notes,
as souveniers. That -- not that I was in Germany, but they --
the money was -- newsreels showed the Germans carrying their money
in a basket to go to market to buy a meal.
0
Were you implying that could happen here?
A
And I said that ultimately that kind of inflatio n and
that breakdown in the economic system led to Adolph Hitler. Now
the whole history of inflation in the world, unless you fight it
and curb it, is that inflation is cumulative and it begins to
mount as it started to in this country, and it becomes runaway.
-8-
A
Now, efforts are being made certainly
Washingtor
and
we are trying to make one here that will curb the principal cause
of inflation, which is government spending. And it is less -
inflation how, hopefully, the sign is in American is lower than it
was at its peak a couple of years ago. So some of the efforts
must be bearing some fruit, perhaps not as much and as fast as
we'd like. But you walk a verythin line between fighting off
inflation and not going over the other way into the kind of disaster
that we had in this country in 1929.
I don't think that the re
was anything strident in pointing out an example of what unrestrained
inflation can do. As a matter of fact, many ofus have beenpointing
that out for a number of years, when the government in Washington
was deliberately adopting a plan of planned inflation on the
belief that it would produce prosperity. It does for a while,
then the hangover sets in.
Ω
Governor, you are equating government spending with
inflation. I think from
and Galbreath, they would equate
federal deficit spending to inflation. And Califomia is not in
that deficit spending position.
A
No, but California is a part of the governmental structure
that is now taking almost hafl of the -- of the workers' earnings
to pay for the cost of government. And I can't do anything from
this point at -- about the federal government, other than maybe set
an example here in our own state level, as we did in welfare reform.
So we are going to try to reduce our share of it, because state
spending - you may not call it deficit because technically we
cannot go into debt and have a deficit budget. But state spending
must be brought under control when state spending is going up ten
per cent a year and the people's wages are only increasing seven and
a half per cent a year.
0
Governor, concerning your memark that you were unable
to do anything about feder al spending under the present circumstances,
the Wall Street Journal this morning carried a story on your campaign
for the passage of the proposition.
A
I read it.
or
It quotes one of your -- an unidentified member of your
staff, an aide, I think it is, quotes as saying this is -- is a
dress rehearsal for the campaign you hope to make in 1976 for the
-9-
presidency.
A
No, Tom, I will bet a million dollars that they can't find
that unidentified aide. I have read about unidentified aides and
I've never been able to find one of my unidentified aides who said
any of those things. I think it must be the -- just one of the
most commonly used ploys in stories of this kind. I read it, I
was happy about the favorable things they said about Proposition 1.
But I expected them, of course, to -- do the other. I don't know
anything I can do that isn't supposed to be tied into the election
of '76.
Q
Well, are you happy about the faborable things they said
about the other?
A
I'm happy about the favorable things they said about
Proposition 1.
0
Governor, do youthink that the principle in Proposition 1
can be applied at the federal level to the federal budget?
A
Yes, I think if anyone would analyze Proposition 1, it
is not a radical new departure from the government al philosophy of
this country. It is not a distortion of the relationship between
the branches of government. It is a use of the constitution for
what the constitution was intended to do. And that is the
constitution is a curb on governmental powers and we -- in the past
we have a great many amendments, both to the state and to the federal
constitution -- when government has apparently strayed and gone
too far or to an excess, the people have then passed amendments.
Now, to put a limitation on taxes and to claim that that is somehow
misusing the constitution, is to ignore the fact that in order to
have some taxes we had to amend the constitution. The government
can only do those things specified in the constitution. So in
order to have an income tax we had to have an amendment that created
an income tax. Now, the weakness of that amendment was, and
there was fighting to obtain this, and they were overruled in the
U. S. Senate -- there was a battle to put the income tax amendment
into effect, but to put a limit on the ultimate amount of workers'
earnings that it could take. As a matter of fact, the Senator
who led that fight was laughed out of politics in 1913, because
he said that if you have an income tax without a limitation on the
constitution it is possible that one day a government of the United
States might take as much as ten per cent of what a man earns.
And
-10-
this was so ridiculous that this was considered to be blatant and
strident and an exaggeration and he was literally laughed out of
public office.
O
Who was that?
Q
But given the responsibility --
A
I can't remember his name. I got it.
Q
Given the responsitities that the federal government has
today, trying to combat inflation and meeting crises all over the
world -- this procedurally or mechanically you think -- the principle
of the initiative could work at the federal level?
A
Well, I know that right now they at e trying to make a
reduction in the percentage that the federal government is taking.
And they are trying to do it - as we tried to do it, by cut, squeeze
and trim. Perhaps as they go on with this it cold lead to whether
this exact form of a federal constitutional amendment - but to some
limitation. Now, hasn't one of our Democratic Senators introduced
a bill which would limit the federal budget to revenues which would
in effect be that the - while it would not be reducing the present
level, would be saying government spending would have to be reduced
back. So there is a great deal of thinking going on. I myself have
proposed a constitutional amendment at the federal level that would
be extremely simple, but that might have an effect on curbing
spending, and that is if the - if any Congressman or Senator who
introduced a spending measure had to ingroduce a revenue measure to
pay for it, a tax at the same time, it might cut down on the number
of spending measures that were proposed.
o
I'm still trying to change the subject. I want to ask
you what your reaction was to Agnew's speech last night.
A
Well, I -- I was very moved by it. I think this whole
thing is a very great tragedy. He stated his case and proclaimed
once again his innocence. And I, for one, knowing the man, having
known him as a governmt as he was before this office, and in his
present office -- I found that -- a great deal sincerity in what he
said.
0
Governor --
0
Governor, many people in this country feel perhaps the
Vice-President did get off too easy. They feel if the common man,
if you will, had been in his position the penalty would have been
much more severe. How do you address yourself to that position?
A
Well, no trial was held. No guilt has beenproven with
regard to the charge. of fraud and so forth, and the government
chose not to prosecute on that basis. Now, I don't think you can
have any opinion one way or theother.
C
Governor, do you think the American people believe Spiro
Agnew and his explanation?
A
You'd have to ask them.
0
Governor, do youbelieve him?
A
What?
Q
Do you believe him?
A
I would say this, I'm going to simply say that in regard
to the charges that were brought against him by the Justice Depart-
ment, there has been no proof of guilt and th erefore under our
constitution he must be presumed innocent until proven guilty.
0
Do you presume him innocent then?
A
What?
Q
Do you presume he's innocent?
A
I think all of us have to, that's the constitution.
ED MEESE: I assume you meant other than the charge to
which he pleaded no contest?
GOVERNOR REAGAN: Yes, other than that.
0
Why do you think he pleaded guilty to that charge?
A
What?
Why do you think he pleaded guilty?
A
I don't know.
Q
Governor, in part of the speech Mr. Agnew referred to the
bribe brokers, I think he called them. The implication was this was
a standard pre-Watergate part of doing business with government.
Now, I don't find that the case out here, do you?
A
No, I don't. As a matter of fact, I'm glad you said that
because -- and I wish particularly a lot of our young people would
realize that I don't think there is a state quite like ours in the
union. Andit goes back to the great reformer, Hiram Johnson, and I
think California is probably the cleanest state, has the greatest
safeguards for the people of any state in the union. Under our
system no --I understand that in many states, in Maryland particularly,
elected office holders do have a great deal to say with regard to
the letting of contracts that are not submitted to bid. In
California thère is a very low financial limit that is placed and
only below that amount can work be contracted for without submission
to bid, I just - I know I, myself, have never - have never been
involved in, nor had a voice in these seven yeas in any thing of
that kind, in any letting of contracts. There are any number of
ways in which things that are commonplace in the rest of the country
would just be unacceptable or impossible in California. We are a --
we are a very puritan state in that regard.
2
Governor, have you ever had anybody come to you in an
effort to influence you in that fashion?
A
Never in the seven years.
Q
Governor, the Vice-Presidnt - former Vice-President's
statement, notwithstanding, he agreed that the government should
publicize the 40 pages of charges against him, which included bribery
and extortion and kickbacks, from contractors. He stipulated
to that. Now, if he was innocent, or if you put your self in his
place, I'm not suggesting that at all, of course -
(Laughter)
Q
-- would you have agreed to the publication of those 40
pages of charges?
A
Well, I -- there is no way I can answer that. I can't
comment and speculate on this, not knowing what the entire situation
was or pressures were on him to do that. I don't know what was at
stake or what was at issue.
Q
Another subject.
Q
No. Still on the Vice - Do you think Gerry Ford is a for-
midable presidential mandidate for '76 --
A
Well, Gerry Ford, Weether he's a formidable presidential
candidate or he seems to have taken himself out of that consideration
and he has repeated this so often, so emphatically, that I assume
that unless and until he changes his mind he has to be considered
as not a candidate.
Q
Well, if the office seeks the man, as you often say --
A
Well, and this could then lead to a change of his mind.
It is verypossible. I keep remembering back when I said
emphatically and absolutely that I would never consider running for
public office of any kind, and here I am. And I wish sometimes I
was some place else.
Q
If he changes his mind is he a formidable candidate?
A
What?
Q
If he changes his mind is he formidable candidate?
-14-
A
Sure, he's got a find record and a go man
and
he
played on the line.
Q
I suppose that answers my question. Your statement
Friday on the President's nomination in relation to Mr. Ford seemed
lukewarm at best, you were pleased with the president's action and
he acted wisely. You didn't mention in there Mr. Ford's name and
any of his qualifications, and I thought that would indicate you
felt the President could have made a better choice.
A
No, not at all, I repeat that I think the President acted
wisely and I ampleased with his choice. Very pleased, but you
have got to remember, also, that there was quite an entourage of
your colleagues waiting at the foot of the driveway and I was among
them less than five minutes after the end of the broadcast, and the
announcement. So obviously I did not sit down to -- to write a
volume or to consider my words other than to give the reaction
they were waiting for and let them go home to dinner.
O
Thank you.
Q
Governor, a number of the Congressmen who will be examining
Mr. Ford for his confirmation say that he should bring his income
tax records along with other records, and I believe he's indicated
he's willing to do that. Had you been in that position would you
have been willing to discl ose your income tax records?
A
I don't know, it depends on certain things. He's
talking about his own colleages. I don't think there's:been any
evidence that he's talking about making them public -- a matter of
public record or anything. So whatever prompted his decisionto do
that, why I respect it and that's certainly his right. Voluntarily,
I've got nothing to hide in mine, but I am opposed to the principle,
as I said before, that in order to hold any kind of appointment or
public office that someone must give up those constitutional protec-
tions as to privacy, that belong bo other people. I do believe
in the legislation, I signed that there should be a protection
for the public against conflict of interest. So that anyone who has
anything that might be a conflict of interest so stipulates.
0
Governor, were you contacted by any representative of the
White House or the President concerning your availability for the
job?
A
Nope.
Q
What do you think of that?
-14-
(Laughter)
Q
What do you make of that? We all had youas Vice-President.
A
I know, I'm the only one that didn't.
Q
Does it surprise you that you were not?
A
No.
O
Did they send you a copy of the contingency speech announc-
ing your nomination?
A
I read that. Maybe that's true. I don't know, but
I-- I nevef for a moment thought that USE I just - as I say, I'm
pleased with what he did. I thought it was a wise decision and I
thought it was the way to go.
O
Did you submit a list of recommendations or have any --
A
Nope?
Q
How about Mr. Luce, I understand he made some recommenda-
tion.
A
Well, every State Chairman was --- was approached about
this and I guess every State Chairman sent in a - their recommenda-
tions, their list. State Charimen were contacted. I'm trying to
think of -- I know that the Congress was also, as we all know, was
publicized that they were, but -
Q
You didn't talk with Mr. Luce about his list?
A
No, never had a word withhim.
Ω
Governor, did youngprove of the shipping of arms to Israel?
A
What -- do I approve of what?
Q
Of the shipping of arms to Israel.
A
Well, here is a very touch and I hage to comment or
speculate on -- we know what's at issue there. I think --- this
(middle East)
administration has made it plain that they want a peaceful, settlement
that is fair to both sides, want a ceasefire ifpossible and a resolu-
tion of this. But at the same time, again, the thin line that must
be walked is Russia's intervention and its shipping of arms to one
side. And I think that unless you are privy to all of the facts and
all of the intelligence information there that you can't comment
on the right or wrong, whatthe administration is doing. I have
confidence in this administration which has done more to settle world
divisions and has brought us closer to a worldwide de tente than
any administration in the last half century, is behaving with wisdom
and on the basis of the facts as they are and I'm content to do that
without trying to inject any opinion. I think that I could also say
I thinkthat this administration has been the best griend that Israel
has ever had on the world scene.
PRESS C ERENCE OF GOVERNOR RONALD REAGAN
HELD NOVEMBER 15, 1973
Reported by
Beverly D. Toms, CSR
(This rough transcript of the Governor's press conference
is furnished to the members of the Capitol Press Corps. for their
convenience only. Because of the need to get it to the prees as
rapidly as possible after the conference, no corrections were made
and there is no guaranty of absolute accuracy.)
---0)
GOVERNOR REAGAN: First of all, we have visitors today
from Hayward State Journalism class, from Hayward State. Glad to
have you here. And the other openingannouncement I have to the
effect that I'm sure you all know about now, since you -- you follow
the news, that we are saying goodbye to Ed Gray. You won't have
him to kick around anymore.
(Laughter)
o
or vice versa.
o
What was his name? What's his name?
A
We are going to miss Ed very much. I think you all
agree.
He's done a great job, but he's going back out into the
private sector, back out into civilian life and this is something
that I always greet with mixed emotions when fellows in our staff
do it. I hate to lose him, but on the other hands I'm -- we
never try to get the kind of people who wanted a career in govern-
ment in the first place. And we haven't. So, Ed, we wish you
well.
O
Governor, if you could conduct a Prop. 1 campaign all
over again now, would youdebate Bob Moretti?
A
Well, I tell you, that's a question I probably would be
asking myself for the rest of my life. But the decisimwas made,
it was -- it was made under a circumstance that what he obviously was
doing was proposing a campaign gimmick, a ploy and I wasn't about
to go along with it.
In the last few days, however, when they were
so successful with implanting that one outright falsehood about
the property taxes, yes, this would have been a way to counter that.
And this is the thing that I will always think about and remember
because it was a falsehood. He knew it was a falsehood and so did
-1-
the others who were repeating it. Proposition 1 specifically made
it more difficult, not less difficulty, for local government to raise
taxes.
Q
Governor, on Proposition 1, the only City Council which :
endorsed Proposition 1 is now filing a million dollar claim in over-
time and pay andother costs because of the special election. Are
you going to support them in their claim?
A
Well, I support the idea, have now from the bery beginning,
I said that I thought the state should pick up the actual cost that
could be attributed to this special election on Proposition 1. Now
whether their figure is right or not, that I think should be subject
to scruting and study. And I think in all of those various
areas of the state where there were regular elections going on,
that here we should make -- take great care to insure that we would
only be talking of what added expense resulted in Proposition 1.
If these figures and claims are being based on the holiday to
employees, I think it is time that this subject be opened up
right now. First of all, cording to our und erstanding of the
law, local entities did not have to give holidays in the election.
They have the right to determine that themselves and the state
employees get holidays. But I think it is time that we booked at
that. No one else gets a holiday on an election day. The polls
are open long enough for anyone to vote, regardless of their type'
of work, and I don't see why government shoul d be providing a
holiday on an election day.
o
Governor, on Prop, 1, could you give us your reaction
to the statement by State Senator H. L. Richardson who said --
who's announced the initiative campaign as, "Grossly mismanaged by
Reagan's top employees. His only good characteristic was making
a drink."
A
Well, sometimes, Bill, in his disappointment gets a little
verbose and a little careless with his use of words, so I won't
comment on it. He'll get the acid out of his system pretty soon and
settle back down to normal.
o
Governor, on your statement relative to holidays, does
that mean that in your view the state ought hot to pay those por-
tions of the election costs that are to be chalked up to extra
heliday pay?
-2-
A
To local governments, no, because according to our
interpretation of thel they didn't have to give thbse holidays.
a
Well, are you encouraging other cities then to also file
claims for the part of the election costs they think were incurred
because Proposition 1 was on the ballot?
A
Well, my position is very clear from the very first.
I
said that out of the surplus I saw no reason why the state shouldn't
be willing to pick up this tab.
O
Do you have any idea how much it is going to cost?
A
Well, according to our figures, we figure that the cost
of the special election was what, about seven and a half million
dollars?
VERNE ORR: Around six and a half -- seven million
dollars.
A
Six and a half, seven million dollars.
o
So that's the top that you'll permit?
MR. ORR: That's an estimate. If the claims are
legitimate in terms of our definition, and are higher than that,
we will certainly pay it. That's not a ceiling on it. But
that's the amount of claims we think will come in.
O
Was that figure seven and a half or six and a half?
VERNE ORR: We had six and a half.
A
I'm sorry, six and a half.
0
Governor, if you had to do it over do you think you waild
have waited for the regular election in June instead of a special --
A
No, I think our reasoning was correct and I'd like to point
out to you we did attain, even with Proposition 1 going down to
defeat, Proposition 1 delivered a lot of money to the people just
by being there. And that was the $800 million dollar surplus.
If there's anybody in this room that believes you had a prayer of
getting that surplus given back to the People without Proposition 1
you are being very naive about the legislature. They have made
it veryplain to us they weren't giving back a dime. But when it
looked like it was part of the bait that might make Proposition 1
more attractive, they came back from their summer recess and decided
that the lesser of two evils was giving the money back to the people.
So you are getting $320 million dollars back by way of sales tax;
$400
you are getting over/million dollars back by way of the income tax
and at the bottom of the scale, as a result of this, families with
-3-
incomes of $8,000 or less are now forgiven any income tax. They pay
no income tax. Not just the rebate, but ongoing.
0
Governor, how would you attack the campaign for the propo-
sition differently than you did in retrospect?
A
How would we -- listen, we just didn't have the resources
to outshout the use of public funds. There was no way that we could
raise enough money to match the literature that was being taken home
by children in school districts. That was being printed at taxpayers'
expense as school printing. A great variety of brochures and
pamphlets, all of which echoed the propaganda of the opposition.
There wasn't any way that we didn't have -- we couldn't match the
staff -- legisaltive staff that was turned over to this task.
Q
Governor, are you saying that your campaign did not repre-
sent any use of public funds at ald?
A
I don't see where it did.
O
Well, you get on T. V. and you are paid by the state, and
yougive your viewpoint; Moratti gets on T. V., he's paid by the
state, he gives his viewpoints, some public funds were used on both
sides, isn't that correct?
A
Oh, I'm not criticizing that. I am talking about
mailings -- direct mailings from government to departments of
government telling them what would happen to their budgets. I'm
talking about mailings to the Highway Patrol telling them that
2,000 Highway Patrolmen would be laid off. I'm talking about
a man stopping me on the street with a letter, telling me the lack
of care for his child that would -- would follow the passage of
Proposition 1. I'm talking about this printing of literally
millions of leaflets out of the school budget of Los Angeles to
be delivered by school children and even using them on school time
to stuff the envelopes. A number of things in which government
was actually employed.
0
Governor, bew subject --
O
Governor, one more question, sir, if I may. It seemed
at the beginning of the campaign, when it all started, that the
opposition was saying that they were going to find a tough time
beating you. Are you saying now it just turned out to be the
opposite?
A
of course it didn't, they knew it all the time.
O
Governor, ew subject.
Q
Same one. I'd like him to answer the question, please.
A
I did. I said they knew it. They knew that their charges
that we were rolling in wealth, they had to know that those -- those
charges were unfounded, that we couldn't begin to compare with the
whole establishment of government that was organized to stop this.
O
Governor -
Q
Governor, same subject. Governor, can you tell us how you
think the -- the defeat of Proposition 1$ has perhaps increased
the potency of Bob Moretti's gubernatorial campaign within his own
party?
A
Well, it made him much better known than he was. He
started the campaign with about a three per cent name identification.
I understand that's gone up considerably. I myself would hate
to run for office on the basis that I denied the people a tax cut.
We are going to continue in trying to get something of this kind
because we think that a tax limitation is inevitable. It will
either come this way with the people sitting down and trying to head
off a calamity or it will come after the calamity has struck. And
so we are going to continue to try and maybe we will be able to
find some ways to do away with some of the vulnerable points that
we had in this. But who -- we believe the People of California,
the working men and women are paying too much for the cost of
government, and we are going to continue to try to do something
about it. We think people want their taxes reduced.
Q
Governor, what are you going to tell the Republican
Governors this coming week-end about the reasons why Proposition 1
was defeated?
A
What's that?
Q
What are you going to tell the Republican Governors this
week-end about why Proposition 1 was defeated?
A
Well, if anybody asks me there, I'm probably going to
tell them what we have already found out from the surveys, that
about 70 per cent of the people that voted no thought they were
voting against the property tax increase.
2
The State Employees Association today asked for a 10.8
per cent average pay raise for 1974. Does that fit into the frame-
work of the kind of Proposition 1 style budget that you are thinking
of for 1974?
A
I haven't had a chance to talk to Verne about that, but we
are still trying to get them all of the pay raise that we wanted to
give them last year, or for this year.
O
That includes 4 and a half per cent that they say was cut
out of last year's raise.
A
Well, we are still trying to get it to them.
MR. ORR: We want it put in before we even finalize
our figures for next year.
0
Could you say if that kind of figure is completely out of
line or is it within the ballpark or what?
MR. MEESE: This is much too early to even talk about
the budget.
A
I can't say anything at all about it because this is the
first that it's even been brought to my attention. All I know, we
are engaged in a fight trying to get them the balance of what we
tried to raise them this present year.
e
Governor --
A
Did you --
O
No, I think we are probably -- I'd be accused of beating
a dead horse on Prop. 1.
O
Governor, are you going to support any resolution to
support the President in Nashville or wherever the Governor's
conference is?
A
We, I think in Nashville, probably all of the governors
there -- or it is in Memphis, the Republican Governors are probably
going to wait, the President is coming to meet with the governors.
0
Governor, are you calling a special session of the
legislature to deal with the energy crisis?
A
Not at this -- not at this point. If that should become
necessary, based on something requiring leglslation -- so far we
have just begun, as you know, getting the reports back from our
group on the Energy Council. And there is only one proposal
that could not be administered -- could not be put into effect
administratively, and that would have to do with the lowering of
the speed limit statewide to that suggested figure of 50 miles an
hour. And that -- that would require legislation and we are not
prepared yet on that to know what recommendation we want to make.
Q
Governor, what do you think of the 50 mile an hour speed
limit?
A
Well, as I say, we are not in a position -- there are --
there are figures ano I've spoken with Secretary Brenniger and
with former Governor Dayman (phonetics) who was with him on this.
They themselves admit that they have had input that show that there
is a potential of it being counterproductive. And so we are
going to continue to -- to meet on this. And I think that before
you would get around to calling a special session you would --
right now thesubcommittee's dealing with thes e problems, could
hold hearings and that would be the first step anyway, and become a
part of this, and we have been in touch with our legislative
leadership on this -- this subject.
Q
Governor, what is the intention of your -- the council?
How much authority do they have in terms of allocation programs
and easing the fuel crisis?
A
Well, they are going to recommend back to the administra-
tion, to the cabinet, and we will do as we usually do with policy
matters. The cabinet and the appropriate department heads, the
staff and myself, we will ment and we will get all the input we
can and we will make decisions.
Q
When you vetoed the bill creating an energy commission
this was your answer to that, if I remember correctly?
A
Uh-huh.
Q
Why haven't you appointed the kinds of people that would
have been included on that commission, members of the public at
large, attorneys, ecologists? Speaking directly of the people
you have on that council now.
A
I appointed the kind of people I thought could get the job
done.
o
Governor, on the speed limit question. Didn't the
President say that he would suggest to the governors that they
consider this action and isn't really the first step for you to make
a proposal to the legislature that they could then study?
A
Well, as I say, we are in the position right now, we have
got to understand first ourselves what proposal we want to make to
the legislature.
Q
When will you make such a proposal?
A
Well, when we are satisfied that we have all the informa-
tion that can make a decision on this. There arestill unknown
factors. There are facts and figures that we need to know, as to
whether this would be, as I say, effective or whether it would be
-7-
counter-productive
O
Governor, ten days from now, unless the federal Cost. of
Living Council changes its mind, an order is going to take effect
preventing the state of California from offering its surplus
royalty oils to the highest bidder, thereby depriving the state of
something like nine million dollars a year in added revenues. Does
your administration plan to get involved with the Cost of Living
Council to persuade them to change their mind?
A
Well, this has just come to my attention. I don't think
that figure is right about nine million dollars.
MR. ORR: Nine million, I believe, in three years.
It is three to four million, Bob.
A
This is a situation where the law says we can take our money
in oil royalties, the state can take it incash or it can take it in
kind, take it in oil, and up until now there's never been any reason
to take it in anything except cash because the price was always the
same. Now, however, the state was faced with the possibility that
it could sell the oil at a higher price than the contract called
for in cash, and so the state chose oil. And now the Cost of
Living Council has said that we can't charge that higher price for
it. This is as far as I have gotten, and that I know of the whole
situation now. So again you are a sking me a little ahead of time
as to what I know. I want to study this. We are -- we certainly
want to cooperate in trying to hold downprices and curb inflation.
But we also are interested in the state's getting the most that it
can get.
0
The people want to buy this oil are outfits like Powerline,
that sell gas at a nickle or so a gallon less than Union and Texaco
and the others, so there is no -- appears to be no rise in prices
facing the consumer.
A
Well, these are --
O
It is motivation --
A
These are all the facts that we have got to find out
before we see what action we want to take with the --- with the
Price Control Council.
Q
Governor, do you think President Nixon should resign?
Q
Whatwas that?
A
Here we go again. I am not going to comment on this at
a time when this now is before thecourt, when he has offered all of
his
-8-
his memoranda and ta S and whatever elee to the ourt. And when
he is meeting with not only the legislators but party leaders and
is coming to meet with us. I'm not going to talk now. In a few
days I'll be in a meeting with the President.
O
Does that mean that you think he might -- there might
be a reason for him to resign?
A
No, no. I'm just trying to avoid commenting. If I
answer one question the hands go up like flowers in the spring.
Or
Why won't you comment?
A
What?
o
Why won't you comment?
A
Just because, as I just said, it is before the courts,
before the judge now. It's made -- he's announced his intention
to lay everything, all records and memoranda before thecourt.
He is meeting with us personally to talk to us and I just -- I'm
not gging to talk now on the basis of only knowing what I read in
the papers.
Q
Back to the 50 mile an hour limit, have you personally
tried traveling at 50 miles an hour, and if so, did you find it in-
convenient?
A
No, but I can -- I know that -- while I'm not an expert
in this subject, I know that in the transportation -- such as the'
truck lines, that provide so many of the necessities, I know that
their cars, their motos are geared to a maximum fuel use or a
minimum fuel use at a higher speed. And I want to know that we
are not going to be -- say, doing something counter-productive.
There may be alternatives to this. Now we are not opposed as we
have evidenced by lowering at least the five miles we can
administratively. We are not opposed tolowering the speed. I've
had a great many years of a particular almost daily drive at 50
miles an hour in private life, and I know exactly what it is and
it was very convenient. It happened to be a 45 mile speed zone.
But I also found out that my --my speedometer was five miles off,
that when I sat here -- right there at 50, I was doing 45, and
every day I used to drive about 23 miles out and 23 miles back
at that speed, and I found it very comfortable. I evenhad time to
look at a seagull or two.
2
Governor, would yougo for Flournoy's suggestion to lower ---
go from a big car to a smaller car? Would you follow that yourself,
as he has done?
-9-
A
Well, my c..n situation is onein which 1 don't dictate
the manner in which I travel. That's determined for me by
security. And it is a -- a number of facets involved. Now, what-
ever they decide to do is fine with me. Actually I -- right now
in the car I'm riding in, I think it is aboutthe same mileage that
the average automobile gets. With all of the smog appliances on it.
I checked that out and found that out. I'm in the car about
twenty minutes a day most of the: time. Ten minutes here and ten
minutes home, and that's it.
O
Would you consider any kind of executive order for other
departments under your command to come down to smaller cars?
A
Well, here again we haven't had the meeting that I've been
telling you about where we are going to discuss all these proposals.
O
Governor, you said that your energy council will report
back to the cabinet. That would imply that it is going to take
some time. The Lieutenant Governor said the crisis is real and it
is here now. Who's going to take care of problems in the meantime?
A
I don't think that the time you are talking about is
going to delay the actual implementation date for some of these
things. Such as if you decide to lower the speed limit, which is
going to require legislation. I think the -- I'm kind of amused
at some of the voices that are crying now in the wilderness, because
it seems to me it was only a few weeks ago that much of our legis-
lative leadership was complaining that this was all invented, that
there wasn't really any energy crisis, it was all a plot to exploit
the people. And I remember alsothat I sort of was coldly
received when I said I believed it was for real. Well, I had evidence
for saying -- based upon which I made that statement. It is for
real. There is no question about it, and I think if -- I could
make an appeal and -- to the people of California in every facet
right now, not just in driving, we can start without waiting. I
think everyone of us in our homes, with the use of li ghts, the
thermostat seeings, all of these things which have to be voluntary,
you can't have a government agency running around turning people's
lights off or seeing whether they got two T.V. sets in operation or
not -- but I think if the people would recognize that they can
minimize the impact, when this really hits in the next few months,
by conserving right now that if A suddenly the burden here in
-10-
Sacramento on SMUD
electric power, if that
rden is lessened
it is going to minimize the impact when things really get tight
later on, and so you would appeal to everybody. We are doing it
in our homes, and I think everyone can. It is -- we have all
been in the habit -- I know in our house we have been in thehabit of
you turn the lights on, come dark and you leave them on whether you
are in that room or not. I think all of us have to start Flipping
the switch when weleave the room.
0
Governor, do you think that's possible, though, the sort
of private conservation without the state actually doing pretty
dramatic --
A
Oh, we are going to do things that have to be done at the
state level, but as I say, there are many things the people can do
that there is no way to enforce. It has to be voluntary. Setting
down your thermostat has to be voluntary. You can't have police-
men knocking on everybody's door every day and asking them what
temperature is your living room. The people are going to have to
be willing to do it and I thinkthat the people of this country,
if they are appealed to and recognize that it is for their own good,
can take a great many of these steps.
O
I was thinking of like something along the lines of
Oregon, the ban on outdoor advertising.
A
I think these are things that we still have to -- that
will be a part of our delibemations. Things that we -- where
we can enforce it, yes. And we are -- we are going to deal with
those.
Governor, would you favor the short term reduction or
relaxation of our environmental or pollution regulations to combat the
(energy)
crisis?
A
Yes, I think on a selective basis. That we are going to
have to -- my own personal view is that we are going to have to do
some things of that kind. When I say selective, I think in areas
where the penalty won't be too great, I think there are areas like
the Los Angeles Basin where you are going to have to give real
consideration as to whether you can do anything. We have begun to
gain in that battle there. Tons of pollutants in the air are
less in the average day than they were in the past. It is hard
to convince people when you are looking at that smoly that it is true,
but it is. And with the geographic and climatic condition that
makes smog a problem in that basin, you'd have to think twice about
-11-
whether you woild relax it there. But I can think out in other parts
of our state where some short term letting up on that wouldn't be
harmful at all.
0
Governor, if a voluntary program to control emergy
consumption doesn't work, you said that you wouldn't like to see po-
licemen walking into people's houses, but isn't that what would
happen if a voluntary program doesn't work and what legislation --
what kind of action would you then foresee taking in order to
enforce?
A
Well, I used that as a kind of a far-out example because
it is a far-out example. Obviously government doesn't have the
manpower to check on everbody's homes. and find -- and find out whether
they are doing things of this kind. I would think that when you
come down basically to the problem I happen to be one who believes
that it is going to be based on rationing. When you have got a
limited supply and you have got real needs that have to be met,
including the heating of homes, I think that a rationing program
that can be laid out as fair to all people is - is going to be the
ultimate answer and then you don't have to police it because then
the individual's got his own incentive for saving.
O
Will the state control -- if there is a rationing program
such as in a heating oil or something like that, do you foresee the
state controlling it or the federal government controlling it?
A
Oh, I don't know. The President has indicated that much
of this he thinks should take place at a -- at a state level. And
I would think, though, that rationing would have to be as it was
in wartime, nationwide.
O
How about gasoline rationing?
A
What?
0
Do you favor gasoline rationing?
A
Well, I think that we are coming tothat. I
think
everyone calls it a last resort, but again I think that it beats
all the proposals for trying to do it by using tax sanctions as
a - taxation as a sanction. We did it in World War II, and I
think it comes down to being the fairness -- the fairest.
Q
Governor, it seems to be a lot of confusion over whether
the state or federal Government is going to find diesel fuel for buses
and trucks. On the immediate basis, just where is that confusion
going to be cleared up?
=12-
A
Well,
let' hope for once between us.
Obviously each level
of government, it does what it can, and then it has to make sure
that it is not going to be - that certain areas are not going to
be pre-empted by the echelon of government above them, so we on the
stat e level are going to explore what we can do statewide and what
is our responsibility.
ED MEESE:
Governor, could I add to that at one point,
is that we have a joint state-federal office of fuel allocation
set up now to handle this thing. It is a federal program in
which the states have been asked to cooperate and so it is a joint
program that's going on here, which the state makes recommendations
to the dederal government which under the federal law has the last
say.
O
Governor, when you refused to comment on the question of
whetter President Nixon should resign or not, it seems to me to be a
rather significant backing away from the administration, or at least
many people are going to interpret it that way. Have you been
burned previously --
A
No.
O
-- by your defense of President Nixon and Spiro Agnew?
A
No, not at all, and what I was trying to do, I thought I
made clear was if anyone is trying to take this or read anything
into my not commenting, they are just kind of violating the facts.
I'm trying to say that -- to retain my position of not discussing
this subject in view of the present circumstances. I can't answer
one -- it is like taking the fifth, I can't answer one and then
refuse to answer another one. No, I have not changed my position
at all. If you can take that as an answer to the question you are
trying to get at.
Q
Governor, what is that position? One of support? If
the President asked you to join his counter-offensive, so-called,
on Watergate, will you?
A
Well, again you are asking a question that --
0
Well, your position has been one of support, so therefore
will you step up?
A
And as I say, I have not changed my position.
0
You are still insupport then of President Nixon?
A
I haven't changed myposition.
O
The President's talking about it, he's talking about it
publicly, he's talking about it with members of Congress. If he
bisa the +++
Republican Governors what they think he ought to do to recapture the
confidence of the people, what would you tell him?
A
I'll bet you a lot of us would have some suggestions for
him.
O
Do you -- I mean would you --
A
Depending on what he had to say to us. You know he --
he might reveal in his remarks something that I've thought of he's
already thought of.
0
What have you ghouth of?
(Laughter)
O
Governor --
O
Governor, can you answer it? Have you thought of some-
thing specifically that you haven't told us about?
A
Not that I can answer right now. Did you -- you had your
hand up several times.
O
That was -- what dcyou think your Presidential chances are
if Gerry Ford is confirmed?
A
I've - -
(Laughter)
A
I've never thought about me ever having any presidential
chances.
Q
Well, Governor, the gallup is predicting a 1976 showdown
between yourself and Senator Kennedy.
Do you think you'll be able
to resist that kind of a challenge?
A
This is a great place to say no comment.
Q
Could you beat Kennedy?
ED MEESE: Good place to say no comment.
A
Ed says that's a great phace to say no comment. I could 5
have asked at which game.
Ω
As to President Nixon, his popularity in gallup polls has
fallen steadily over the last year and a half. Do you think the
people's dissatisfaction in California with Nixon's performance in
the Watergate affair was in any way involved with thedefeat of
Proposition 1 in the sense that they associated you with Nixon on
a national level?
A
Oh, no. I don't think there was any evidence of that.
I think -- I think if anything there is a -- Watergate has created
in many people's finds just a distrust of anything governmental and
-14-
anyone connected wit government. But in that use, since the
people on the other side were government, too, it was ld have worked
both ways to their -- totheir disadvantage as well as to ours.
That, to me, is the -- is the fall=off or the fall-out from
Watergate. No, I think the opposition, as I say, they were very
successful in planting an idea.
O
Governor, on the same subject, can you react to Secretary
of State Brown's comments charged that your freeze on construction
of new state office buildings has resulted in the state paying about
$21 million dollars a year in rent to private landlords and the freeze
being the worst kind of false economy?
A
Well, I cauld repeat again that biblical reference of --
that I did once before, he is still multiplieth words without know -
ledge. Our construction freeze has been a pretty selective thing.
As a matter of fact, as a result of what we have done here with
holding down the size of government, the entire Master Plan for how
much office space provision we must have for employees here in
the Sacramento Capitol complex by the year 2000 has been, if I
remember the figures correctly, just about cut in half. Because
wehave halted the vast increase in the size of government, and
had we just gone into implementing the Master Plan we'd have a lot
of empty buildings because we have the same numberof employees now
that we had seven year S ago in state government, and no other
government, to my knowledge, can make that claim, including no
local government in California, because in these seven years local
government has added around 350,000 new employees.
VOICE: Thank you, Governor.
000
-15-