Department of the Treasury Remarks and a Question-and-Answer Session With Department Employees

SECRETARY BLUMENTHAL. Mr. President, ladies and gentlemen:

Mr. President, I guess I don't need to begin by saying we're glad to see you. [Laughter]

We're meeting you in the largest room in this building, the Cash Room. And you can see that we have gone one better on what history tells us happened at the time of the Inauguration of President Grant, when the whole Inaugural Ball--the entire one--took place in this room. That compares to the six ballrooms that your Inaugural Ball took place in.

We're delighted to see you. We're your closest neighbor.

I was extended a cordial welcome when I came, by the many people in the Treasury who are eager to work with you and with us to do a good job.

We're just across West Executive Avenue, and you've shown us that it's only a few feet. We're very happy to have you here.

THE PRESIDENT. Thank you. I'm glad to be here. Thank you very much.

Well, I'm very glad to be here, Mike. You are my closest neighbor, as you know. A lot of my people in Georgia always felt that if I came to this building, it would probably be because of income tax evasion or something like that. [Laughter]

I would imagine that standing on this stage are more Georgians than there were at U.S. Grant's Inauguration in this room, right after the Civil War. We had about 60,000 people who came to the Inauguration Balls this time, and many of them were my close and personal friends whom we had met and gotten to know during the long, tedious, laborious but enjoyable and openly successful campaign.

I don't think many Presidents have taken the time to come and meet with the key employees and leaders of our Government. And I consider it a great honor to be able to come and meet with you for a few minutes.

One of the major successes that I have already realized is a choice of a superb Cabinet. I had an opportunity, as you know, to select a Secretary of Treasury from literally thousands of people who were well qualified. And there is no doubt in my mind that I chose the best person in the United States to be your leader. I have complete confidence in him, and I am deeply grateful that Mike Blumenthal was willing to come and work with you and with me to make the Treasury Department successful. And I'm sure he'll succeed, along with us.

ADMINISTRATION POLICIES

There is literally no department in Government which touches more people in a more sensitive way than does yours. I think you know that a lot of the attitudes that people form about public administration and leadership and about the attitude of their own Government toward them is derived from the Treasury Department.

This is so important to me, because in the last few years our country has been deeply embarrassed. There has been an impression that swept the Nation that our Government was neither competent nor honest nor had sound judgment, and that's because of the mistakes of a very few people who were in leadership positions. The consummation of the Vietnam war, the revelations that the CIA and sometimes the FBI violated the law, and the Watergate revelations really shook the people of this Nation and helped to destroy their good relationships and opinion of the Federal Government.

But at the same time, there remained within the hearts and minds of Americans an unshakable patriotism and an unshakable hope and belief that all those serious mistakes could be repaired, that difficult questions could be answered, and that we would approach the future with a renewed commitment to common principles that have bound our lives together.

I have been lucky enough to be elected leader of this great country. I'm no better than any of you. I'm sure there are many people in this room who are better qualified than I am in many ways. I've got a lot to learn. I've only been on the job now about 3 weeks. Some of you have been here for years.

I was introduced yesterday at the Commerce Department by Dr. John Taylor, who had been on the job since 1929--48 years. But I share with you an equal responsibility to represent the people of our country well. And whether I succeed or fail depends on you and whether or not we can form a partnership that's tangible and continuing and mutually respectful.

I think the country is ready for some substantial changes. I want to be sure that every one of those changes is an improvement. There is no way that I can sit in relative isolation in the White House and decide what's best for our people in the Treasury Department. You've been here. You've seen the mistakes. You've seen the achievements.

The things that are good and proper and efficient and effective ought to be preserved and enhanced. The things that may have been equally adopted for 15 or 20 years, which can be improved, we want to improve them. And if there are things that ought not to be here at all, we want to eliminate them.

We hope to get authority very shortly to reorganize the structure of Government in broad generic terms--transportation, electronic data processing, printing, personnel management, on the one hand-internal reorganization within departments like your own and, in addition, the shifting of major responsibilities among departments.

I want to be very, very thorough and very, very careful. I don't want to make any mistakes. And the best way to insure that that hope is realized is to use your advice and your counsel and your suggestions and your criticisms.

You need not have any fear of the prospective changes that might be brought forward. No one will be discharged in the entire Federal Government as a result of reorganization. No one in the Federal Government will lose seniority or pay status. We might very well find it necessary on occasion--it would be rare, I think, relating to the Treasury Department-to transfer people from one job to another. If that should occur, any training required would be fitted in with your own capabilities and, obviously, would be paid for by the Government.

We are now embarked on some very substantial analyses to make Government better. We've already introduced a brief economic stimulus package, equally balanced between 1977 and 1978.

We are following that up with a very comprehensive energy policy. Our Nation is the only one that's developed on Earth that doesn't have some comprehensive energy policy. By the 20th of April, we will have completed that study and we will submit to the Congress then, legislation to implement our recommendations. Formed today, with former President Ford and Vice President Mondale as chairmen, will be an organization designed to save energy. And serving in that group will be members of my Cabinet, key Members of Congress, and representatives from different groups around the Government. In addition, we hope to set up State functions in all 50 States to hold down the waste of energy.

By the 1st of May, we will have a comprehensive study completed on welfare reform. And later on this year, under the leadership of Mike Blumenthal, we will have a comprehensive analysis completed on income tax reform.

We don't want to do things in a haphazard way, but the country is ready for some reanalysis so that we can say what needs to be kept and what needs to be changed for the better. Obviously, anything we do will be carefully scrutinized by the public and by Congress. That's the way it ought to be.

But I'd like to conclude my statements by saying this: I hope that you will participate in an active way, that you will help overcome the weaknesses or shortcomings that might be apparent to you in my leadership or in the leadership of Mike Blumenthal and others. It's a time for a maximum degree of cooperation and harmony.

And as you deal with your clients, the people of your country, whether it might be in revenue sharing, or whether it might be in enforcement of the laws that relate to drugs, or whether it might be in Secret Service protection, or whether it might be in Treasury, or whether it might be in overall international trade agreements-no matter what it is, I hope that you will always remember, as I will try to do, that we are not bosses of anyone; we're the servants of the American people.

And I hope that I can exemplify this attitude in such a way that it might inspire you to do the same thing. I've tried to eliminate some of the artificial trappings and respect that's openly paid to me. I feel that the Office of Presidency is substantial enough and has an adequate amount of respect already.

But I want all of us to take the demeanor of a government as it should be in a democratic society. We're servants, not bosses. And to the extent we can recognize whom we serve--the people of our country--in a fair way and an enlightened way, I think we will be all-successful.

I have a few minutes now. If you have any questions, I'll try to answer them. If I can't answer them, I'll let Mike Blumenthal answer them.

QUESTIONS

DEPARTMENT VISITS

Q. Mr. President, I work at Customs. I would like to know when you are coming to Customs, because we don't have a chance to see you.

THE PRESIDENT. Let me say this: I doubt if the people in Customs have seen very many Secretaries of the Treasury. Let me let Mike Blumenthal come and get acquainted first, and then later on, I'll try to come.

When I got elected Governor of Georgia, I had a similar desire to meet with the people who work in the government, so I went over to our revenue commissioner's office. And I was going through from one office to another, and there was a very old gentleman there who had obviously been there 20 or 30 years. I shook hands with him and I said "Have you ever met a Governor before?" He said, "I've never even met a revenue commissioner before." [Laughter]

I want you all to insist that Mike Blumenthal come, and I'll come when I can.

GOVERNMENT REORGANIZATION

Q. In your plan for government reorganization, do you foresee any changing of the law for the Treasury Department? Specifically, do you see us taking on any new responsibilities or losing any old ones?

THE PRESIDENT. I can't answer that question yet. What we will do, first of all, is get the authorizing legislation and then start an analysis. The staff work will be done by the Office of Management and Budget, primarily. I'll probably appoint someone directly to represent me as a coordinator of the entire process. But nothing would be done, obviously, without the full participation of you who are involved, working through Mike Blumenthal, before a change was made.

But I can't answer your question about specific changes that might ultimately be recommended to the Congress.

What I'm asking for is the same authority that was given to all the Presidents from Franklin Roosevelt, in the early thirties, right on up through Richard Nixon. And we've introduced a bill now that I think will get rapid passage in the Senate and, I think, without delay get approval in the House that will restore that authority.

What it does mean, in effect, is that I can present to the Congress a reorganization plan whenever I develop one on a specific subject. And if the Congress doesn't veto that plan in either House in 60 days, it automatically goes into effect.

The only change that I'm requiring or requesting, compared to the previous authority, is that while the bill or plan is still in committee, I would have the right to amend that proposal before it gets on the floor. In the past, once it was submitted to Congress, no amendments were permitted. But with that one exception, it will be the same as the authority given to Richard Nixon, for instance, when he came in office in 1969.

I can't answer your question about specific changes yet.

FEDERAL REGULATIONS; TAX REFORM

Q. Mr. President, I read in the paper that you are asking the Cabinet members to read their regulations before they issue them. I think it might be interesting to see if the Cabinet would fill out the new short forms on income tax regulations.

THE PRESIDENT. I've noticed, as a peanut farmer, that the 1040 gets simpler and simpler every year. And I've just hired my second CPA to help me fill it out. [Laughter]

I think that you will see that if our economic stimulus package proposal goes through, giving a standard deduction of $2,800 to every family, that it will be indeed much simpler. And we have some plans already that we almost proposed to Congress that would be included in a comprehensive income tax reform that I hope to make it very simple. But after this year, if the Congress adopts just this first-step proposal, 75 percent of all the taxpayers of our Nation will be able to fill out by themselves the income tax return, which will be a big step forward.

I know that my request to the Cabinet officers to read all the regulations that are issued is a very, very onerous task. I also know that my request that the ones who are responsible for writing the regulation sign it might create some problem. But I want to make sure that the regulations that come out of the Federal Government, first of all, are necessary; secondly, are brief as possible; third, are worded in plain and simple English and, also, accurately represent the policies of the Secretary or the member of Cabinet or my own administration.

Now, if it takes all weekend for the Secretary of Treasury to read those regulations, I'd like for him to do it--[laughter]--not on a permanent basis. But I think it's very important that the Secretaries of HEW and HUD and Transportation and Treasury actually read those regulations for awhile to see the enormous volume that comes out. And then, I think, they'll be able to call a meeting of those who are responsible for writing the regulations and say, "Look, why can't we cut down on some of this volume? Why can't we simplify the language, and why can't we leave more responsibility and judgment up to our field workers to exercise common sense?"

Now, I'm going to be doing the same thing at the White House level. I've already spent a good bit of time studying the overall procedure by which Government regulations are issued. And I've already had a meeting with the members of the Government Operations Committee in the Congress to start working out some changes in the law that might reduce the onerous requirement for the writing of regulations.

I never dictate a letter. Almost all of my memoranda are written on one side of one sheet of a 5- by 8-inch pad. I can write it very quickly, send it out, and it's done. I hope that every person in the Federal Government not will quit dictating--[laughter]--but will try to abbreviate the enormous volume of paperwork.

And I would also hope--to close out a long answer to a very good question-that in the reports required from people around the country on basic data, that we might have several of our departments get together and share the preparation of requisite forms, so that a businessman who does have to submit information about his own affairs could fill out one form and let HUD and HEW and EDA and Transportation and others share the information that comes in on that form.

But I'm determined to accomplish this before I go out of office. If I do, my administration will have been successful, even if I don't do anything else.

GOVERNMENT RESPONSIVENESS

Q. Mr. President, your intention to get a handle on the Federal Government and make it more responsive to the average citizen--as a part of that process of getting a handle on it, there are literally thousands of Government workers who are not in the supergrade status, so to speak, or the higher levels of Government, who feel that they want to make this type of responsive contribution for the citizenry, and yet we are--the proverbial word--weighed down so heavily by the mass of bureaucracy. As part of your intention to get a handle on Government, will there be new types of programs that will allow this, what I like to refer to---or .really don't like to refer to it as such--but it is a wasteland of power and energy. And we want to contribute, but how do we get out of that boxed-in feeling?

THE PRESIDENT. Let me answer very quickly. When I became Governor of Georgia, I ran on a platform, similar to my Presidential platform, of reorganizing the Georgia government. I thought that the civil service workers would be my major obstacle in reorganizing the government.

When I got in office, we turned to the civil servants, who were by far the most knowledgeable people, for help. And they were involved in the initial stages of the preparation of proposals for improvements. They became my strongest supporters, because every one of you in this room--even much more than Mike Blumenthal and Jimmy Carter--are devoting your whole life to your professions in serving the American people in Government.

You've just got one life to live on Earth, and I know you want to do a good job. And to be constrained from giving good service by unnecessary paperwork, regulations, complexity of assignment, a lack of specificity about who has responsibility for a job, the multiple division of responsibility for the same function among many agencies--those things sap away the ability that you have to do a good job.

So, reorganization is a kind of a--not a good word, perhaps; I wish there was a better word---but I think it ought to originate with you.

And any time any of my Cabinet officers bypass the civil servants, at whatever grade in that process, they will be violating my own instructions and making a very serious mistake. It will also be a sacrificial or suicidal mistake, because unless we have your support and your participation and your advice, we're not going to succeed in making a change, even if we want to. But I would like for it to come from you, up through your superiors, ultimately to me.

The other thing we are going to do is this: The 1979 fiscal year budget will be prepared using zero-based budgeting. This is a procedure that I used in Georgia for 4- years. It's simple and it works. It puts every function--whether it's been here 50 years, 5 years, or the first time next year--on the same basis. You don't just analyze the new proposals for next year; you analyze all the functions that have been there for a long time. That's important.

But the second thing is this: It lets the people deep within the department, the supervisors, maybe, of just 8 or 10 people, prepare an analysis of what you are doing, how many people you have working for you, how much money you are spending, the ultimate service that you are supposed to be delivering, and your own suggestions on how your performance might be improved.

Now, this would result in tremendous savings, obviously. It would give you an automatic way to express a pent-up hope for more efficient delivery of services that you might have had for 5 or 10 years, and it will let your superiors know that you are striving to do a good job. Ordinarily in government--I know State government; I'll just speak for it--if somebody does have a good idea, they are very afraid to propose that idea because they might be rocking the boat or changing the status quo and they feel that they might suffer.

But if there is a standard report, a budgeting form, which is one side of one sheet of paper--that's all--you can fill it out with a ballpoint pen, you don't even have to type it, and those contributory, beneficial suggestions work their way up to the top. And then your department heads arrange those suggestions in an order of priority. We start at the top and fund down as far as we can. It will make sure that the money that is allocated to you goes further, and it also makes sure that you have a voice in the preparation of the next year's budget.

Those kinds of changes help to weld together in a cohesive way the newest and most junior employee with the Cabinet officer who's the head of your Department, and ultimately to me.

So, I'll do everything I can to make sure that we do have a way to make your own lives more meaningful, to make your own Department more effective. And my success or failure, as I say, depends almost directly on how much you trust me, how much I trust you, and how closely we are tied together in a common purpose that can't be severed.

And I believe we have the hope among the American people that we succeed. There is a good sense of new confidence and good will that exists around our Nation now toward all of us. And I just want to be sure that in no way we ever betray that hope and betray that confidence.

Thank you very much.