Lyndon B. Johnson photo

The President's News Conference

September 22, 1966

THE PRESIDENT. [1.] We had a Cabinet meeting this morning. I reviewed with them the legislative program and the fiscal policy program that I think you are generally familiar with, but to remind you--

THE LEGISLATIVE PROGRAM

I outlined to them that the Senate committee had this morning voted unanimously to report out the transportation bill. That bill has passed the House. We would expect early action on it in the Senate.

The House Interstate and Foreign Commerce Committee reported the truth-in-packing bill.

The House Banking and Currency Committee reported the savings and loan regulation bill, which we consider a very important item. It has passed the Senate. We want to take it up in the House as early as we can.

They are working on the tax bill, and we would hope for action during the day.

The Senate Appropriations Committee reported the Labor-HEW bill with an amount for our Teacher Corps in it, which is very important to us. We would hope for early action.

So much for the legislative program.

CONTROL OF EXPENDITURES AND BORROWING;

FISCAL POLICY GENERALLY

[2.] I reviewed with the Cabinet the very vital importance of not only each Secretary, but each Under Secretary, Comptroller, Budget Officer, controlling all the expenditures he could and watching very carefully for any low priority items so that as these appropriations bills come to them they will be in a position to review them very--scrutinizingly.

I had an off-the-record meeting last week with the Cabinet, with all of the comptrollers, with all of the budget officers, and went into detail with them. This morning I reiterated what I had said and gave them some new directions in that respect so far as placing orders is concerned, so far as filling vacancies is concerned, so far as allowing overtime is concerned, so far as making purchases of new equipment is concerned, and matters of that kind.

As we say on the farm, "Maybe we ought to try to get by with some baling wire, patch things up," to get by during this particular period when there is such pressure on our economy.

Second, I urged them to counsel with their affiliated agencies--the Secretary of Agriculture, for instance, with the Federal Land Bank, the Intermediate Credit Bank, Farm Credit Administration, REA, and others-to counsel with those agencies on the necessity of trying to keep their allocations at a minimum and still meet the needs; to ask them to bear in mind that we are going to have a good deal of rollover in securities. But we do not want to go on the securities market for any new money where it can be avoided.

We will have a rollover of some $47 billion-high $40 billions--$47 or $48 billion between now and the first of the year. There will be needs for new money that will run several additional billions. But we want to keep that at a very minimum because Governors are watching their bond programs, mayors are watching theirs, public agencies are watching theirs. We are trying to encourage private investors to watch theirs because the economy is running at a very high rate.

Unemployment has come down rather miraculously, and this is a very tight period. So I asked them to avoid overtime, to avoid procurement orders, to avoid floating new securities, and to encourage those associated with them to do likewise--if it is HUD, it may be with the mayors, the housing people, and others; if it is the Justice Department, it may be just talking to bond attorneys; if it is Agriculture, I have given you those agencies; if it is Commerce, it may be the cooperation you receive on roads and things of that nature in their field, particularly with the business field.

There was a general discussion along that line. Now that is all known to you. I don't want to reiterate it. I will be glad to answer any questions on it. I have said to Bill that I don't care--I don't want you to feel I am giving you more information than you want to take. At the same time, it looks like when I talk with you after these Cabinet meetings, you say it is a snow job if I tell you what has happened. If I don't tell you, you say your feelings are hurt because you say we won't let you in on the knowledge.

I feel like Hobart Taylor's little boy 1 did one time when he was writing a paper for school. He told his daddy he was studying Finland and he said, "Won't you help me get some material on Finland?"

1 Hobart Taylor III, son of Hobart Taylor, Jr., a Director of the Export-Import Bank of Washington.

And when he came home that night, Hobart stopped at the library and filled a briefcase full of material on Finland--all the pictures and the drawings and books, and everything. He gave them to his little boy, and his little boy looked at him. He said, "Well, what do you think about it, son?"

His little boy said, "Well, Daddy, that is really more information than I want on Finland."

It may be that you have more information than you want this morning. But Mr. Schultze is prepared to review with you, to the extent that you may desire it, the information that he presented to the Cabinet that he thinks would be helpful to you. It involves, primarily, the very strong determination that this administration has, and has always had, to control expenditures very rigidly and to see that our estimates to the Congress held up just as nearly as we can make them do so.

RECENT BUDGET ESTIMATES

[3.] Each year our estimates on deficits have been less than we said they would be. That has happened for 3 years. Now, of course, we have great difficulty in light of the Vietnam expenditures and in light of the pressures from a burgeoning economy. Everybody has more income. Prices are higher, and so forth.

But he will relate that to you. Do you have the chart available here on our deficits?

MR. SCHULTZE. Yes, sir.

[At this point a chart was displayed, with the following figures on budget deficits for three successive fiscal years]

Fiscal year 1964: Billions

January 1963 estimate $11.9

January 1964 estimate 10.0

Actual deficit 8. 2

Fiscal year 1965:

January 1964 estimate 4.9

January 1965 estimate 6.3

Actual deficit 3.4

Fiscal year 1966:

January 1965 estimate 5.3

January 1966 estimate 6. 4

Actual deficit 2.3

THE PRESIDENT. I will leave you with that and go on to another appointment. But this story has never been covered. This is where the press--I don't think--has been credible. We have announced it, but it has never gotten over to the people.

I went around to 30 Congressmen the other night and asked them and didn't get an accurate guess from any of them. I don't get it from the newspapermen that I've talked to, whom I have asked.

When we came into office [pointing to the chart] this was the budget in January of 1963. I came in, in November. There was the deficit, just a little under the $12.4 billion that President Eisenhower had, which represented the high one in peacetime. By the end of the year, as a result of the practice of the Cabinet and the others through expenditure control and other things, it was $8.2 billion.

In fiscal 1965 we cut it pretty thin at $4.9 billion. We had some of our Vietnam move-up here. We closed down on everything and held it as much as we could. We wound up with $3.4 billion.

So we went from $11.9 billion to $10 billion to $8.2 billion, to $4.9 billion, to $6 billion, to $3.4 billion. This is actual. This is finished. This is fait accompli; this is not conversation.

This is $5.3 billion in 1966, that's our present fiscal year that just ended June 30th. It has moved up from January to $6.4. Of course, this is 18 months ahead of time. The end result is $2.3 billion.

You see some increase in Vietnam because we did take delivery on a good many items, $1 ½ billion worth, or else you couldn't have a balance here. We took delivery in the last few weeks of June on things that we could accelerate. We wanted to accelerate them for Vietnam, so we paid for $1½ billion out of that so that item could be balanced.

Now next year will be a different story. But there it is for 3 years. We are trying to add a fourth year without things being too bad. That is what we did in our Cabinet meeting.

I will take any questions on this or any other subject that you may have before Mr. Schultze goes ahead.

QUESTIONS

EXTENT OF REFINANCING BY THE GOVERNMENT

[4.] Q. Mr. President, you are going out of the securities market and going into the Treasury bill financing. Do you know roughly how much that is going to affect the deficit?

THE PRESIDENT. We are not doing that. That is a "When are you going to stop beating your wife?" question. We haven't stopped beating it; we never did start. We are not going out of the securities market. We are going to be in it to the tune of some $50-odd billion, a portion of which will be taken by trust funds, as they always have been.

Q. May I follow that up?

THE PRESIDENT. Yes.

Q. When you mentioned $55 billion the other day, some of the Wall Street boys went to calculating and said that means you must be looking for about $8 billion in new money.

I gather from what you said this morning that is too high.

THE PRESIDENT. I would say several billion dollars--we can't tell. We are trying, as you see, to get each man to be as careful as he can on what money he has. But we would guess it is going to run somewhere above 50. It depends on how much new money we have to have.

The point I am making is I am talking to all of them to keep them at a minimum. If you tell your family you want to hold down expenses and not go to a show I think sometimes you mis-estimate a little.

So we can't be precise. Roughly we have a high 40 rollover and we have indications of demands for several additional billion, which, I would guess, would run somewhere in the five to seven or eight range.

But we are going to try to curtail those any way we can, and I think we will be rather effective with it.

Q. Just for clarity purposes, by "rollover" you mean refinancing?

THE PRESIDENT. Yes.

THE ATTORNEY GENERAL VACANCY

[5.] Q. Sir, are you considering the Secretary of Agriculture as a possible replacement for the Attorney General?

THE PRESIDENT. No.

Q. Mr. President, can you tell us when you may make the announcement on the Attorney General?

THE PRESIDENT. No. I will tell you the moment I know. But the thing you must understand is that we don't like to keep these things a secret. Just as soon as we make a decision, I will try to announce it to you. Don't let them go around. There are frequently personal reasons why a man has to check with his university to see if this can happen, and so forth.

But the day will come when regularly employed speculators will find out that their speculations are just pure speculation and nothing else, because we don't appoint men on that basis.

In the old days when you could leak that Mr. So-and-so was scheduled for an appointment, then if he was not appointed somebody would be criticized--they are gone. They have been since November 1963, at least. I don't know how long before that.

As Chuck 2 says, some Minnesota radio station says that the Attorney General has definitely been appointed. We haven't discussed it with the Secretary of Agriculture. We don't plan to.

2 Charles W. Bailey 2d, Minneapolis Star and Tribune, Des Moines Register and Tribune.

I am considering several different people for the Attorney Generalship. I have talked to Mr. Katzenbach about it and some others about it but no reporters. I would say, generally speaking, you can count their speculations as totally unreliable--uninformed.

Q. It was in the New York Times, too, Mr. President, this morning.

THE PRESIDENT. I don't want to pick out any individual paper, but I have observed it can be in error sometime. [Laughter]

The point I want to make to you--when you see on the ticker that Oshkosh says that Bob Pierpoint may be Chairman of the Joint Chiefs of Staff, you don't necessarily need to give much credence to it, because the very fact that it is on there is the best indication that it is not likely to happen. [Laughter] Are there any other questions?

Q. Robert C. Pierpoint, CBS News: Yes, sir.

Mr. President, I am glad I am not going to be Chairman of the Joint Chiefs.

AMBASSADOR GOLDBERG'S U.N. SPEECH

[6.] Q. Ambassador Goldberg 3 is making a very important speech before the United Nations today. We have not been able to read it all yet. But I wonder if you could tell us whether this is an offer to halt the bombing for a while, which we expect the Vietnamese will have to answer before there will be a pause, or whether the pause will depend on some other action?

THE PRESIDENT. No, I would think that the best thing for you to do, Bob, is read the speech and make your own interpretations. I have read it. But I think until you have, that would be the best way to handle it.

3 Arthur J. Goldberg, U.S. Representative to the United Nations.

Q. Could I ask another question on it?

THE PRESIDENT. Yes.

Q. Does it represent an important new initiative on the part of this Government?

THE PRESIDENT. You will have to make that evaluation of it. I approve of what the Ambassador says. I think it is good for him to say it.

We are very anxious, as you well know, to do anything and everything we can through every forum we can, to try to promote peace in the world. I think that is what he is trying to do. He has my full approval and the Secretary of State's approval.

Are there any other questions?

Reporter: Thank you, sir.

Note: President Johnson's seventy-fifth news conference was held in the Cabinet Room at the White House at 12:25 p.m. on Thursday, September 22, 1966. Following his departure from the Cabinet Room, the Budget Director continued the news conference. The complete text is printed in the Weekly Compilation of Presidential Documents (vol. 2, p. 1334).

Lyndon B. Johnson, The President's News Conference Online by Gerhard Peters and John T. Woolley, The American Presidency Project https://www.presidency.ucsb.edu/node/238560

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