Harry S. Truman photo

The President's News Conference on the Budget

January 13, 1951

THE PRESIDENT. [1.] I want to call your attention particularly to this memo sheet, which sets out as nearly as possible what the budget totals are, and how they are allocated; and there is a statement on the second sheet which explains the situation as well as it can be explained.

The budget this year is larger by a great many billions of dollars, on account of the fact of the defense program that we are trying to implement both here and abroad. The expenditures for local government have been decreased about $1,100 million--as you will see on this sheet--and we are making further efforts to eliminate what we consider unnecessary expenditures. But when a person goes to work and makes wild statements about how many billions of dollars you can take out of the budget, you can be morally certain that he knows nothing about the figures in the budget. [Laughter]

If you remember last year, we published a small summary of the budget, and explained exactly where the funds came from, and where they went. We will have that same booklet out in about 2 weeks, for your information and guidance.

I don't mind people being honestly against what I may believe to be the right thing, but I would like for them, when they discuss the thing, to at least know half as much about it as I do.

Now, if you want to ask any questions, I will be glad to try to answer them.

[2.] Q. Mr. President, on page M26 (p. 76),1 about the middle of the page, third paragraph down, you say, "In addition, the Department of Defense is constructing additional plants and facilities to produce military items not ordinarily produced by private firms for the civilian market." I am wondering if you would elaborate on that, to indicate what type of materials and what type of plants that refers to?

1Page references in parentheses, throughout this news conference, indicate where the subjects referred to may be found in the Budget Message as printed herein (Item 13); all other references correspond to the page numbers in the Budget as published in House Document 17 (82d Cong., 1st sess.).

THE PRESIDENT. That refers principally to the expansion of plants that will have to produce this defense supply. The Defense itself, under the general defense appropriation, has authority to create whatever production is necessary to meet the emergency. That is what that means.

[3.] Q. Mr. President, before we get started on this, on M7 (p. 63) that chart recommended new obligational authority for 1952. Will you not explain just what that is?

Director Lawton: It is the appropriations and other authorities to incur obligations and to enter into contracts, to issue orders that are provided in this budget, and in the legislation proposed under the budget for each agency of Government. It is the authority for the military to order airplanes. It is the authority for the Internal Revenue Bureau to hire personnel to collect taxes-that kind of authority. The difference between that and expenditures is the difference between placing an order and getting delivery on that material later on, at whatever period it comes off the line and payment is made out of the Treasury for that material. It is the difference between ordering a thing and receiving and paying for it--which may, in the case of some types of equipment, be as much as 18 months to 2 years.

THE PRESIDENT. It is that same old argument between the anticipated budget and the cash budget.

Q. Let's not get into that.

THE PRESIDENT. I thought maybe I could get you on that. [Laughter]

Q. I would like to know how you figure this--I do not understand how you make a commitment for, say, fiscal year 1953 as well as 1954 ?

Director Lawton: You are making commitments in 1952 for some goods that may be delivered in 1953 or 1954, and paid for.

Q. And paid for?

Director Lawton: When delivered.

Q. How do you figure it, because I cannot understand why you have got interest the same amount?

Director Lawton: Interest is a purely cash appropriation. It is an indefinite appropriation of as much as may be necessary. There is no fixed amount set beforehand. It is set by basic law, that you pay whatever interest is due on bonds, and it is a cash expenditure again--interest upon cash. You don't have to get an advance appropriation for interest.

Secretary Snyder: That estimate is on conditions as they are right now.

Director Lawton: That's right.

Q. What I am trying to figure is, we are making expenditures of 71.6 in fiscal 1952. Those are actual cash expenditures?

Director Lawton: Cash out of the Treasury, yes, sir.

Q. Now, during 1952 we will commit ourselves for $94 billion more, is that correct?

Director Lawton: Not more. You will commit yourself for $94 billion, out of which will be paid out--represented by the $71 billion. The 71 billion represents commitments made in prior years and in the current year. And there are tables in the budget that will show the distinction between the amount of cash out of current appropriations and out of prior year appropriations.

Q. Commit some 70 billion more ?

Secretary Snyder: Not necessarily.

THE PRESIDENT. That is an estimate.

Q. How much do we commit?

Director Lawton: The carryover will be nearly 60 billion.

Q. Is that where you get your 140 in the Economic Message?

Director Lawton: The 140 in the Economic Message are the items shown in here for the 1951 and 1952 obligations, and if you take that memo tablet, it is just about the total of the major national security programs that is shown in the first two columns.

Q. This is the total of new appropriations in the 1952 fiscal year; that is, the $94 billion?

Director Lawton: 94 billion is the total new obligational authority, whether it comes from appropriations or borrowing authority, such as the Export-Import Bank provisions in here, or anything else--anything that can authorize the Government to make commitments.

Q. Are there many in the new 1952 bill? Director Lawton: Many that the Congress will have to be obligated in the 1952 bill.

Q. Is that carryover from the 1951 to 1952?

Director Lawton: No, at the end of 1952.

Q. At the end of 1952.

Director Lawton: It says in 1951 and 1952 some 1951 funds will still carry over some expenditures into 1952--longtime procurement.

Q. What is the total of that carryover ?

Director Lawton: About 60.

Q. Paid in subsequent years?

Director Lawton: In subsequent years.

Q. Ten billion, nine in supplementals in sight for the remainder of this fiscal year, as I gather?

Director Lawton: That's right.

THE PRESIDENT. That's correct.

Q. That carryover, then, that reduces actual expenditures below what is given here ?

Director Lawton: No, sir.

THE PRESIDENT. No, that is in addition

Director Lawton: That is in addition, yes.

Q. Where is that 60 billion shown ?

Director Lawton: It is a sum that you would have to get from taking the obligational authority, shown in the table in the budget, and deducting from it the expenditures in the 2 years.

THE PRESIDENT. That is a good exercise in arithmetic for you.

Q. How much ?

Q. What shows the 60 billions ?

THE PRESIDENT. It doesn't show it as a separate figure. You have got to take the authorizations and figure out how much are going to be paid for in 1951 and 1952. Then, what is left of it will go into this 60 billion.

Director Lawton: Just as an example, the obligational authority in 1951 is $87 1/2 billion, present and proposed. You will spend in 1951, 47, which leaves a 40 billion carry-over to start with.

Q. I get it.

Q. How much of the 71.6 for spending will require congressional action by appropriations for obligations ?

THE PRESIDENT. All of it will. All the authority either has or will be authorized by the Congress.

Q. Yes, sir.

THE PRESIDENT. Can't spend money without an authorization.

Secretary Snyder: He meant this year.

Q. How much more will Congress have to--

THE PRESIDENT. Maybe I didn't understand your question. Ask that again.

Q. I know some part of that 71.6 is covered by past congressional action, but I wonder how much of it is dependent upon future congressional action ?

Director Lawton: I would think that approximately half of it, at least, will be out of 1952 appropriations.

Q. Half has to be authorized ?


Director Lawton: At least. I can give you that exact figure, if you will call later on. It is in here--in the tables.

Q. Mr. President, since this carryover at the end of fiscal 1952 will be approximately 60 billion, can we figure, then, that the budget in 1953 and 1954 will be substantially higher, cashwise, than this 71 billion?

THE PRESIDENT. I imagine that they will be. That is cash now. I don't know that it is in the authorization because we can't tell how the developments will work out. That is anybody's guess.

[4.] Q. Mr. President, I found in this budget last night, but I cannot locate it now, what appeared to me to be a third deficiency appropriation of $10 billion. Is that correct?

THE PRESIDENT. That is correct. It is in there.

[5.] Q. Mr. President, on page M17 (p. 70), under stockpiling, you indicate that you will ask for an additional supplemental appropriation of $820 million for the current fiscal year?

THE PRESIDENT. That is for 1952--1952.

Q. Oh! Then on page 266, under Strategic and Critical Materials, you talk about asking for a supplemental of about a billion dollars. The question is, are those references to the same request, or are they separate requests ?

THE PRESIDENT. I will have to look and see. The billion, so I am informed by the Budget Director, are supplementals that went into this last session, and the 800 goes to the 1952.

Q. Well, now, is that--

THE PRESIDENT. Give this fellow a chance, he has been trying to get up for 10 minutes.

[6.] Q. On page M49 (p. 94), it says, "No other loans will be made under this program," referring to the loans to educational institutions, "until the outlook for college enrollment shows a clear need for such housing." Yet I think there is 36 million in the budget for 1952 for that purpose. Will you explain that difference?

THE PRESIDENT. You will have to ask that question again.

Q. In your message on page M49 (p. 94), at the top, in regard to those loans for educational institutions for housing, it says, "No other loans will be made under this program until the outlook for college enrollment shows a clear need for such housing."

THE PRESIDENT. That means just what it says.

Q. 36 million for this purpose ?

Mr. Staats: It will be necessary to have funds under this program for defense programs, but it is limited strictly to that.

Q. That is what it is for?

THE PRESIDENT. Strictly for defense.

[7.] Q. Is the third deficiency included in the expenditures for fiscal 1951?

THE PRESIDENT. Those amounts that are going to be spent in 1951 are included.

Q. What I am trying to do, sir, is locate that 10 billion third deficiency in these tables on defense spending.

Director Lawton: That is new obligational authority. There will be very little of it that will be spent. They will be--the orders will be placed before the end of this fiscal year, but very few if any deliveries will be made out of that fund.

Q. What will the actual amount of the appropriation be ?

Director Lawton: The appropriation will be 10 for that purpose.

Q. We have now about 43--which I believe is correct--for defense purposes, now appropriated for this fiscal year?

Director Lawton: For the military.

Q. Yes. I am talking about defense--43 billion now appropriated for defense purposes?--

Director Lawton: Yes--yes.

Q.--for this fiscal year? Then there will be a third deficiency, making that--

Director Lawton: It will be up in the--54.181--that is the figure in this table.

THE PRESIDENT. 54.181--it's on that memo sheet.

Director Lawton: It is included in that. That is the difference between the present appropriations and what we have shown here as the amount that will be appropriated during the fiscal year.

[ 8. ] Q. Revenue estimates--personal income --

Secretary Snyder: May I answer that? The revenue figure that is used in the Budget Message is calculated on the basis of an annual average income to the individual of $245 billion per annum.

Q. What is it now?

Secretary Snyder: The November figure--that is the latest official figure we had--was running a little over $232 billion per annum.

Q. Mr. Secretary, is that a calendar or fiscal year estimate ?

Secretary Snyder: That is the estimate that the Department of Commerce puts out every month, you know, but it is for the calendar year, yes.

Q. Mr. Snyder, what was the estimate for the budget in the calendar year?

Secretary Snyder: 221, I believe it was.

THE PRESIDENT. 221 is correct.

[9.] Q. Mr. President, you spoke of taxes several times in the message. Can you say whether it is the idea that the new taxes should take effect at the start of this fiscal year?

THE PRESIDENT. Well, that is a matter for the Congress to decide. I hope that they will take a position as soon as they possibly can.

Q. Could that possibly mean that you might recommend starting as of the first of the calendar year?

THE PRESIDENT. I shall recommend that they start as quickly as the Congress will agree to have it done. I hope it will be the first of the year.

[10.] Q. Mr. President, referring to receipts, on the very first page (p. 61), it shows estimated receipts for 1951 about 44 billion, and that estimated receipts for 1952 are 55 billion. That shows an increase of about 11 billion. Now, the new taxes that we have had since then were approximately $5 billion on personal income, and an estimated 3 billions on excess profits, which would make 8 billion. I presume that this is because of inflation and expansion in the--

Secretary Snyder: No, increased income.

THE PRESIDENT. Increased income, not inflation.

Q. I was about to add that. The Secretary didn't give me a chance.

THE PRESIDENT. The receipts go up automatically every year after income.

Secretary Snyder: With the rate of increase and the anticipated defense burden of spending that comes from.

Q. Getting back to the receipts, where it says 40 billion, the increase would be 7 billion, is that right ?

Secretary Snyder: It is a conservative estimate, we think.

Q. Mr. President--

THE PRESIDENT. [ 11. ] Give Joe Fox2 a chance. What is it, Joe ?

2 Joseph A. Fox of the Washington Evening Star.

Q. On M11 (p. 66), Mr. President, is it correct to assume that the new tax figure will be 16.5?

THE PRESIDENT. What's that, Joe?

Q. On M11--I say is it correct--

THE PRESIDENT. I know what you are talking about. I will answer that question in my tax message, Joe. [Laughter]

[12.] Q. Mr. President, you said a minute ago that you hoped that taxes would take effect the first of the year. Did you mean retroactively to the first--1951 ?

THE PRESIDENT. The excess profits tax was a retroactive tax--December 1st or first of the year, if I remember correctly. It is a precedent that can be followed.

Q. I would like to know, do you want the tax to take effect on January 1st?

THE PRESIDENT. Yes, I would like to have it take effect on January 1st. That is perfectly plain.

Q. Does that apply to the individual plan?

THE PRESIDENT. That applies to anything that is made, I hope.

[13.] Q. Mr. President, is there anything in here for added interest on bonds that aren't used that are not turned in, to encourage people not to sell their bonds?

Secretary Snyder: Well that--number one--Congress will have to act on that, and issue an order for the extension period. That is what you are referring to, on maturing bonds--the E-bonds that begin to mature in May. This year, there will be, I believe, 1,100 million of E-bonds that will mature in the calendar year 1951. If we should decide to ask for an automatic extension of these bonds, we will have to go to Congress to get that authority. There is no figure in here to cover that interest that will be involved there. It is "bottomed" on maintaining the outstanding date, so if they are on those bonds it will be on some others, don't you see? So it actually is covered in here on the basis of our present indebtedness.

Q. Has that decision been made?

Secretary Snyder: Not yet.

[14.] Q. Mr. President, I would like to ask you a question that I think the so called economy bloc in Congress will ask you. On page M6 (p. 62), you say, about this budget, "It reflects reductions in other expenditures, in order to divert a maximum of resources to the overriding requirements of national security." I assume you mean nondefense spending? Now, in this little pamphlet here, in the middle of the page, total major fixed and other charges for 1952, it shows a reduction of 3.21 billion--total 1.82. Is that what you claim you are reducing?

THE PRESIDENT. Turn back to the first page, and you will see right in the middle of the page exactly what I am claiming. It is 1,082 million--that is correct.

Q. That is what I wanted to be sure of, that being the difference between the 20 billion and the 21.66, is that it?

Q. Where does that go?

Q. Where is that figure ?

THE PRESIDENT. In the center of this sheet.

Secretary Snyder: You have to learn arithmetic. Subtract the right figure from the left, and there it is.

THE PRESIDENT. Right in the center of this mimeographed page it's a little bit different-you will find a figure over in the right-hand corner of 19,084 million. Next to that, you will find 20 billion, 166. If you subtract that figure from that figure, you will get the figure I gave you.

[15.] Q. On page M41 (p. 88), right in the middle of the page, "To avoid the unnecessary accumulation and loss of perishable agricultural commodities, legislation is needed to permit direct payments to producers, in lieu of market price supports to Government purchases." Is that the Brannan farm plan ?

THE PRESIDENT. That is the Brannan plan. That states it very clearly. It took you a long time to dig that one out! [Laughter]

[16.] Q. I would like to ask if--it isn't in this budget--you said you were going to cut back on nonessentials. It seems to me that you have got everything in here that you have asked for before, perhaps ?

THE PRESIDENT. 11 1/2 billion is set out there as having been cut out of this budget, in asking for appropriations for the things that are not directly considered necessary for defense.

Q. Can you pinpoint those?

THE PRESIDENT. Yes, I will pinpoint them for you--133 items. If you will ask the Budget, I will make a list of them. Forty percent of the items in the budget have been cut back--forty-two percent.

Secretary Snyder: Forty-two percent and 135 items, isn't that it?

THE PRESIDENT. Forty-two percent and 135 items. And you can have a list of those items from the Budget.

Q. That totals a billion, .08?

THE PRESIDENT. That's right.

Q. Can you give us an example right now ?

THE PRESIDENT. I can't think right off. I will give you a list, and then you will have it, then there won't be any inaccuracies in the total. I can't memorize all those things, because I had to pass on every single item individually. A stack of papers that high-[ indicating ]--I will let you go through them, if you like. [laughter]

[17.] Q. I would like to get back to Joe Fox's question, on page M6 (p. 62).

THE PRESIDENT. Yes, I know where it is.

Q. "I shall shortly recommend an increase in tax revenues, in the conviction that we must attain a balanced budget to provide a sound financial basis for what may be an extended period of very high defense expenditures." Now isn't it inescapable that you have to ask for 16 billion plus?

THE PRESIDENT. Not necessarily. It may be for 20 plus before we get through.

Q. You mean you may ask for 20 plus?

THE PRESIDENT. I am going to ask whatever it takes. I can't set that figure until the Treasury finds out exactly what it will be, then I will ask for it.

Q. Down 16, but it may be more?

THE PRESIDENT. According to this budget, it would.

Q. I would like to know what the administration's policy is?

THE PRESIDENT. I am going to tell you in the message. I am not going to tell you this morning.

Q. That has not been decided ?

THE PRESIDENT. No, the figure has not been decided. But I have made it perfectly plain that I don't see any sense in increasing the Federal national debt when we have got a prosperous country such as we have now, and we ought to pay as we go. I have always thought that. I thought that in World War II.

Q. You have insisted on a pay-as-we-go policy, paying for this program out of current revenues ?

THE PRESIDENT. That is as far as we can, yes.

Q. Whatever it is, the policy still stands to pay for the whole program out of current revenue ?

THE PRESIDENT. That is my policy--always has been.

Q. That might result in an increase in taxation of 60 percent?

THE PRESIDENT. I can't give you the figure, but I will give it to you very carefully when I write this message.

Q. Assuming everything going up in proportion, that would be what it would be.

THE PRESIDENT. Well, you make your figure from the figures that are before you.

Q. In view of the uncertainty as to military programs, and the rate of military procurement, it is possible that if procurement does not move as rapidly as is planned, the request might be less that 60?

THE PRESIDENT. That is correct. That is the reason I cannot give you the exact figure now, but I am going to try to give you as nearly an accurate figure as I can.

Q. Can you give us a range ?

THE PRESIDENT, No, I won't. You make your own range. You have got the figures there before you.

[18.] Q. Mr. President, at your press conference the other day, you said you might ask for legislation on food prices. You didn't say the Brannan plan. Now, is it the Brannan plan?

THE PRESIDENT, It has no connection with that at all--it has no connection with that at all. This is the consumer food price that I am talking about.

Q. Doesn't the Brannan plan include keeping prices low to consumers ?

THE PRESIDENT. Yes, it does, but that has nothing to do with price control matters. That is a matter that will require legislation. It was purposely examined by this last Congress.

Q. That is different from food subsidies?

THE PRESIDENT. Yes--entirely different.

Q. Is your food subsidy in here?

THE PRESIDENT. No, it is not.

[19.] Q. Do you expect to revise these figures, including the military figure, before you send up those facts?

THE PRESIDENT. No, I do not. No, I do not.

Q. 16.5?

THE PRESIDENT. No, I do not intend to do any revising. This budget is going up just as it is, but we have got to examine the whole situation as thoroughly and completely as we can, and then go up there with an intelligent message, and try to get action on it. That is the object.

[20.] Q. Mr. President, would you comment on the statement of such Senators as George and Millikin, that tax increases of the magnitude you propose would wreck the economy ?

THE PRESIDENT. I don't agree with them, that's all the comment I will make. I think this economy can stand what we are doing here. I wouldn't make the statements I do if I didn't believe that. And I have every assurance from the people on whom I rely for information, that that is the case.

[21.] Q. Mr. President, do you plan to submit a special message on taxes outlining your recommendations ?


Q. Can you say approximately when that will go up?

THE PRESIDENT. As soon as we can get it ready. I hope within the next 30 days.

[22.] Q. Mr. President, does the fact that the budget contains no inclusion of expenditures for farm subsidies and food subsidies mean that we won't have food subsidies in order to keep down the cost of living?

THE PRESIDENT. Not necessarily--not necessarily.

[23.] Q. Mr. President, I would like to ask Mr. Lawton, if I may, about those 135 items. Do you have them mimeographed and available in printed form ?

Director Lawton: No. They are in the tables here, but we haven't got it mimeographed yet. We can identify the particular items.

THE PRESIDENT. We will try and have them all put together and mimeographed for you at a later date, but we can't do it between now and Monday.

[24.] Q. Mr. President, getting back to the balanced budget, you are arriving at your 20 billion figure by anticipating 1952 estimated deficits?

THE PRESIDENT. This budget is based on an anticipated deficit of 16.1 or 2, I forget what the figure is.

Q. A deficit of 16.5 for 1952? Is that where you arrive at your 20 billion figure?

THE PRESIDENT. No, I said it might be anywhere between 16 and 20. I am not going on record on that. I will give you that in the message. You can ask all those questions you want all the way around, and I will answer them in exactly the same way.

Q. Mr. President, depending on how that third supplemental appropriation breakdown is expended in 1951 and 1952, isn't it possible that the deficit for fiscal 1952 will be larger than 16.5 billion?

THE PRESIDENT. I don't think so. These estimates have been very carefully made.

Director Lawton: If you will look at page A15, it indicates how much of 1952 expenditures are out of 1952 authorizations, and how much out of prior years--the same for 1951. It's the total at the bottom.

Q. I don't have that here.

Secretary Snyder: It's in the green book.

Director Lawton: Page A15.

THE PRESIDENT. It's in the green book. The last total on the table.

[25.] Q. Mr. President, in view of the fact that on page 65 you do not show any new appropriations for the ECA, does that indicate that that will be wound up for 1950 current fiscal, June 30th?

THE PRESIDENT. No, they will not. Those appropriations are shown as a defense item-international affairs. You will find it under international affairs.

Q. Has there been any decision whether ECA will be continued beyond June 30th?

THE PRESIDENT. It will have to be continued beyond June 30 positively. We had hoped to wind it up on June 30, but conditions are entirely different now from what they were at the time we were trying to wind it up. 1952--what I am talking about is the date in this budget. It is supposed to be wound up at the end of fiscal 1952.

Q. There has been some question as to whether or not it might be wound up on June 30 this year?

THE PRESIDENT. Never was any question on that; 1952 is when it was intended to be wound up. I think I set that date myself.

[26.] Q. Mr. President, on page M53 (p. 97), Social Security, Welfare, and Health, I don't find health insurance in there. Has that been dropped for the time being?

THE PRESIDENT. No, it has not. It's on page M56 (p. 100).

Q. That is the old national health insurance program ?

THE PRESIDENT. Yes. You will find it on page M56. Better watch out, you may get a speech out of me on that. [Laughter]

[27.] Q. Mr. President, do I understand that regardless of any future authorization or obligations, $70 billion is all that the Government expects in the next fiscal year, regardless of any future authorization?


Q. What could happen to increase that figure?

THE PRESIDENT. It is based on this budget. Can't tell what emergency may come along.

Q. Short of any emergency, sir?

THE PRESIDENT. It is based on the budget here, as nearly as we can figure it out. That is what the budget is for--the best guesses we can make.

[28.] Q. Mr. President, I got a little confused about which June 30th you were talking about on ECA ?

THE PRESIDENT. June 30, 1952.

Q. ECA would be continued beyond June 30, 1951 ?


[29.] Q. Mr. President, while we are on the New Deal, let's get it all straight.


Q. Fair Deal--I mean Fair Deal.

THE PRESIDENT. What is it?

Q. On page M30 (p. 80), "I again recommend that the Congress enact legislation to establish a Federal Fair Employment Practice Commission to prevent discrimination in industry." Are you going to do any more about it than what is down in here?

THE PRESIDENT. Of course I am. I wouldn't put it in there if I wasn't going to do something about it. I don't talk through my hat.

[30.] Q. Mr. President, in trying to pin down the 6 billion to pay taxes, if you have a $60 billion carryover into 1952, and you carry military expenses continuing it at the rate into the year of 40 billion, you could have a budget approaching $100 billion for military--mainly for military--a 1953 budget of around $100 billion.

THE PRESIDENT. We will see what that looks like when we get to that point. Then we will talk about it at that time.

[31.] Q. You said that that would be pay-as-you-go?

THE PRESIDENT. I am hoping that that will be a pay-as-you-go. That is what I am working for.

Q. Didn't you estimate a $55 billion cost in your Economic Report?

Director Lawton: That was the spending rate.

THE PRESIDENT. The Budget Director said it was the spending rate as of the end of the year, 1951--calendar 1951.

[32.] Q. Mr. President, under the heading Proposals, I believe you are repeating the $300 million aid to education. That was not enacted in the last Congress?

THE PRESIDENT. That is correct--that is correct.

[33.] Q. Then on page M31 (p. 80), revision of unemployment insurance, is that also a repetition of your message request of a year ago--or 2 years ago, I have forgotten which--for extension of unemployment insurance--expansion of it?

THE PRESIDENT. Yes. Yes, expansion of it. It is practically the same request as was made 2 years ago, and last year.

The Budget Director calls the attention to the fact that it is all set out in my message of last April. 3

3 The President's special message to the Congress on the unemployment insurance system (see 1950 volume, this series, Item 84).

Q. The April message?

THE PRESIDENT. Yes. That part which has not been enacted is what we are talking about here.

Q. Will there be specific messages on these items of new legislation ?

THE PRESIDENT. Well, we are always writing letters and telephoning. I don't know whether you would call it a special message or not. There will be some special messages, but not on every item in the request, because some of them will be taken care of without that.

[34.] Q. Mr. President, may I ask one question about that third supplemental-10 billion. Do we know exactly how much, if any, of that will be expended in 1951, how much is included in the $47 billion expenditure figure for fiscal 1951 ?

Director Lawton: Very little of it.

[35.] Q. Mr. President, running through your method in the explanation of the various functions, there is new emphasis on our contributions towards defense. Does that mean that these various functions are going to take on a new turn, or is that simply more or less the things that they have been doing?

THE PRESIDENT. No, it means just exactly what it says.

It is very difficult to decide just exactly what is entirely defense and what is not. I imagine that there are some people who would class the White House as unnecessary to the defense effort, and you can go right down through all the rest of the agencies. Those agencies that are set out here, and are justified as making a contribution to the defense effort, are doing just that, or we wouldn't say so. Tax collection is another one. Do you think tax collection is essential to the national defense? You can take a dozen different things. And, of course, those things have to be collected, or you wouldn't have any national defense, if you want to go around and justify it. But that is what we are referring to in that part of the message.

[36.] Q. Mr. President, I would like to ask this question of Director Lawton. On pages M60-M61 (pp. 102, 103), the Budget recently did estimate what the cost of gratuitous insurance as against National Service Life Insurance would have been over the past 10 years--between 1940 and 1949--had it been put into effect during the past war. I was wondering if there had been any estimates made on what the cost to the Federal Government would be on a current basis, if this recommended legislation is enacted?

Director Lawton: We have not made it on an annual basis. We made the estimate, which was given to the committee considering it, which was about 800 million in savings. The General Accounting Office made an independent estimate and they came out with 788 million; and the committee estimate, I believe, is somewhat higher. That was over the 10-year period. It depends on the number of people that would be in the Armed Forces, and the number of casualties.

[37.] Q. How much of that is defense and how much is nondefense?

Director Lawton: 12 billion, 4 includes the--all of the extensions of military and economic aid, of course, and the expansion of defense production.

Q. Can you break that down between those items and the nondefense items?

Director Lawton: They are all indicated in each of these headings which ones they are.

Q. What page is that?

Director Lawton: In each of the individual sections--in each table--proposed legislation is separately set forth.

[38.] Q. Mr. President, on page M51 (p. 96)--this is rather a small item--the budget includes expenditures of $106 million for the fiscal year for buildings and current operating expenses. Is that schools ? I wonder if Mr. Lawton could tell us how much of that 106 is capital outlay for buildings, and how much is operating expenses?

Director Lawton: I cannot give you that figure. I don't have it right here.

[39.] Q. May I ask a question about this military budget? You said you were not setting out the details of the $60 billion at the present time. Will that only come to light when the defense people from the Pentagon go up before the Appropriations Committee, or will you send a special message ?

THE PRESIDENT. When they have those figures in detailed arrangement, so they can furnish them to me--there is some delay on that--they will be available just as quickly as they can be.

Q. They will be available ?

THE PRESIDENT. Supplemental budget, so the Budget Director tells me.

Secretary Snyder: You are talking about for 1952 now?

Q. I am talking about funds for 1952 for the military--the complete military budget.

Secretary Snyder: He is not talking about the supplementals. He is talking about the 1952 estimates here. They will be apparent when they go up with the appropriations.

Director Lawton: Same detail as would be set up in this budget for later submission.

Q. Could you give us a rough estimate of the portion of the military budget that will go for hardware, equipment such as airplanes, and so forth?

THE PRESIDENT. The Budget Director says he cannot answer that question until he gets the details from the Pentagon.

[40.] Q. Mr. President, can you give an idea as to the rough timing of the tax message? When is it going up?

THE PRESIDENT. I hope it will be sometime within the next 30 days. It may take longer than that. Depends altogether on how fast the experts work.

Q. Sir, this is the last chance you will have of getting a retroactive tax ?

THE PRESIDENT. I understand that very well.

Q. The Ways and Means Committee is going to start hearings on the 6th of February.

THE PRESIDENT. Sixth of February, yes.

Q. Yes, sir.

THE PRESIDENT. I hope so. I will tell you what the Secretary of the Treasury was saying to me. They are working on a renegotiation act this week. They will continue work on it next week, and as soon as he gets it ready then they are going to start hearings on the tax bill, and the Secretary says we are going to try to have the tax message ready, so we won't be delayed.

[41.] Q. Mr. President, in connection with your interest in the pay-as-you-go policy, have you had any advice as to how high a budget the Federal Government could sustain and still expect to pay for it?

THE PRESIDENT. No, I have not. No, I have not.

[42.] Q. On the 10 billion, 9 figure for international security is there any breakdown, Mr. President, on that figure as to how much would be for European military aid ?

Director Lawton: The bulk of it would be.

Q. What page are you talking about?

Q. Page M7 (p. 63), the table there of the new obligatory authority for the 1952 fiscal year, it's the second figure following the 60 billion.

THE PRESIDENT. The Budget Director informs me that it has not yet been broken down between military and economic, but it will be. It depends on how much material we will have to supply, and how much they can supply themselves. And that will have to be worked out as we go along. General Eisenhower can give us some idea, when he gets back.

[43.] Q. Mr. President, if you were writing this budget, what would you call this, a $94 billion or a $71 billion budget?

THE PRESIDENT. I would call it a $71 billion budget, which I have just done. This is my budget. I signed it. What is in that is what I am saying.

[44.] Q. Mr. President, on page M52 (p. 96)--

THE PRESIDENT. M52? All right.

Q. Two questions I would like to ask there. One is in reference to the coverage on social security. Does that statement regarding the millions of people still uncovered mean that you will plan a special message asking for extension of H.R. 6000? 4

THE PRESIDENT. The message of last April covers that situation, and it is still what I want.

Q. And the next sentence, which says, "Pension and insurance plans for special groups should supplement social security benefits, as industry pensions already do, for several million workers." Would you fine what you mean by "special groups"?

THE PRESIDENT. The Railroad Retirement Act is one special group in particular, and there are all sorts of pension plans in the employ of both State and Federal Governments. That is principally what is referred to.

[45.] Q. Mr. President, did you ask for a specific amount in this budget to pay for the Brannan plan?


Q. Have you any idea what it might cost?


[46.] Q. Mr. President, on page M57 (p. 99), I find a very interesting observation,

4 H.R. 6000, as enacted, is the Social Security Act Amendments of 1950, Public Law 734 (64 Stat. 477). speaking of veterans, "Before many years, nearly all the population may be veterans, or the dependents of veterans," and the subsequent paragraph--if I read it right--means that someday we are going to be, if we keep on increasing military forces, we are all going to be taking in each other's wash.

THE PRESIDENT. That is correct. If you will just sit down and analyze the situation, the present rate of increase will be 49 million people, veterans or dependents, inside the next 3 or 4 years.

[47.] Q. Mr. President, on this sheet, you have opposite Federal National Mortgage Association, for 1952, a minus sign. Does that mean that the Federal National Mortgage Association does not start taking in money?

Director Lawton: Liquidation.

THE PRESIDENT. The sale of mortgages.

[48.] Q. Mr. President, in my reference to the statement about pension and insurance plans for special groups, which supplements social security benefits, as industry pensions already do have several million workers, are you referring to the fact that the General Motors plan and the Ford plan increases the social security billing in part to take care of the cost ?

THE PRESIDENT. A great many of the big industries, Standard Oil Co. of New Jersey, Standard Oil Co. of Indiana, all had pension plans.

Q. You think that Government pensions and railroad worker pensions should likewise be increased, is that the idea?

THE PRESIDENT. No, no. The idea is that the Government approach to the thing should be equal for everybody. Then if they have an additional pension, that is just their good luck.

Q. You are not referring, then, to persons who are not covered by pensions in any way, shape, or form, you are referring to those who are covered, but who have not had an adjustment in the rate, through collective bargaining or some other way in the last--

THE PRESIDENT. No, that has no connection with it whatever. What I am trying to do is to get everybody fairly and equitably covered under the Social Security Act. Then, if they happen to have these pensions, they are just that much better off for it.

Q. I don't follow that.

THE PRESIDENT. We don't want to take their pensions away from them, because most of them made contributions to these pensions and they are entitled to them; but the idea that I have in mind is to cover them all under social security. Then if they have pensions on top of that, why that is their good luck.

Q. Oh, I see.

[49.] Q. Mr. President, are you considering a national sales tax?

THE PRESIDENT. Every sort of tax that will be necessary to raise revenue undoubtedly will be considered by the experts. I am not considering any kind of special tax myself personally.

[50.] Q. Mr. President, on page M7 (p. 63), that basic table there, I notice the agricultural budget expenditure went down from 2 billion, 784 to 986 million, and they are going up to 1 billion, 429. Would you explain why that is ?

THE PRESIDENT. We sold $680 million worth of cotton, that is what makes the difference.

[51.] Q. Mr. President, I would like to ask a question about M59 (p. 102), on the GI bill. You give a warning there, that the reenactment of the GI bill the way it was in World War II would mean a perpetuating of some of the difficulties and the features of that bill. Are you planning to recommend any legislation to cover--set up any standby legislation--that is, a standby bill, in the event we should get into a general war, or would you wait?

THE PRESIDENT. What we have in mind is a GI bill of rights, in the case you refer to, without some of the difficulties we had to contend with in the other that we have had experience with. There were several things in that bill that turned out to be rackets, and some of them are being investigated now for fraud. There is no use going ahead with something that you have had experience with which you know won't work, and I want to see an equitable bill of rights for those people who serve under the present emergency.

Q. People in Korea now are not covered?

THE PRESIDENT. Yes--they are not covered. They ought to be--they ought to be. They are fighting just as hard as anybody did-and harder, I think.

[52.] Q. One more question, please. On page M61 (p. 103), what do you attribute the value of some 212--no--yes--212 billion-million-in veterans life insurance dividends by fiscal '51 and fiscal '52?

Director Lawton: That is the lag in the payment of these dividends which have been worked on this year. It's the distribution between the 2 years of the actual cash outgo for this current year's dividend.

Q. It is not an increase ?

Q. Same dividends are being paid?

Director Lawton: This year's dividend is going to be at the tail end of the year, and it will be somewhat distributed this year-some of the actual checks will go out in July or August. When they begin on June 30th, it draws down from one fiscal year to the other in the actual issuance of checks.

[53.] Q. Mr. President, there is a statement on page 740 in the big book, regarding postal rates, in which you want to reduce the deficit from $521 million to 160. Is there any--through legislation--is there any way that you can indicate some of the ways in which that rate increase will be handled at the present time ?

THE PRESIDENT. Yes, the Postmaster General is working on a program right now that will meet that very situation, and as soon as he has it ready I will give you the figure. The 160 million refers to the Government's use of the postal service. That is the reason it runs to below 160 million because the Government has to pay its share as well as anybody else. That also includes airmail subsidies.

[54.] Q. Mr. President, you mentioned the fact that those who contributed to old age insurance were entitled to get the money, was that what you said?

THE PRESIDENT. Yes, that is correct.

Q. Are you aware that if they get as much as $50 on the outside--they may never get a nickel on what they have contributed ?

THE PRESIDENT. No, I was not aware of it--I am not aware of it.

Q. There is considerable complaint about that in the congressional mail. And it is said that that might keep older people out of the war labor market.

THE PRESIDENT. I don't think so, May.5 They are as patriotic as we are. I hadn't heard that complaint, to tell you the truth.

5Mrs. May Craig of the Portland (Maine) Press Herald.

Q. It was only as much as $15, but now if they earn $50 a month, they would not get all the insurance to which they have contributed.

THE PRESIDENT. Well, I will have to take a look at that.

Q. Will you do that?


Q. It's in the mail.

THE PRESIDENT. May, are you anticipating having that held against you? [Laughter]

Q. No.

[55.] Q. Mr. President, on page M27 (p. 78), toward the bottom, "I am recommending a further extension of rent control authority, with provision for recontrol when necessary to protect tenants in defense areas against exorbitant rent increases." My city and State happen to be among those that have been decontrolled by action of the State general assembly, and I wonder if you could elaborate for me on how you believe this "where necessary" should operate, and how would that be determined?

THE PRESIDENT. Particularly in defense areas, where increased population in defense areas will soon be. That is particularly what it refers to, and where the rent groups will immediately go to work.

Q. May I ask about Norfolk, for example, where I suppose there will be again a pretty hefty increase in rents? You would determine when rent controls should be reimposed in Norfolk under the legislation you have in mind ?

THE PRESIDENT. Well, we will have--I think the Housing Expediter would be the man to make the decision, after a survey.

Q. The authority, then, would be vested in the Housing Expediter to recontrol?

THE PRESIDENT. It should be. It should be.

Q. To protect tenants in defense areas, not tenants in other areas ?

THE PRESIDENT. I would like to see them all protected, but I was using that as a horrible example.

Reporter: Thank you, Mr. President.

Note: President Truman's two hundred and fifty-first news conference was held in the State Department Auditorium at 10 o'clock on Saturday morning, January 13, 1951. The President was assisted in presenting information on the budget by Secretary of the Treasury John W. Snyder and by Frederick J. Lawton, Director of the Bureau of the Budget, and Elmer B. Staats, Assistant Director.

Harry S Truman, The President's News Conference on the Budget Online by Gerhard Peters and John T. Woolley, The American Presidency Project https://www.presidency.ucsb.edu/node/231149

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