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Press Conference March 7, 1962

THE PRESIDENT.  Thank you.  I have two announcements.

[1.] I have today sent the following telegram to the chief executive officers of the major steel companies and to the president of the Steelworkers Union, and I quote:

"I appreciate your willingness to commence negotiations early and I share your regrets that the parties to the steel labor negotiations were unable to conclude a settlement in their negotiations of the past few weeks, despite earnestness and good will on both sides.  The present temporary recess should enable both parties to reappraise their position.  The best way to achieve a desirable settlement in the public interest is through free and responsible collective bargaining.  An early labor settlement consistent with price stability in steel would be in the public interest, as well as in the interest of the parties themselves.  The Nation as a whole I am sure shares my conviction that such an agreement would materially strengthen our economy and country.  To this end I am requesting the parties to resume collective bargaining at an early date.  I hope they will be able to meet together by next Wednesday, March 14-"

[2.] The second announcement is that I want to comment on the tariff and trade agreements which have just been concluded at Geneva with the European Common Market, the United Kingdom, and 24 other countries following the largest and most complex negotiations in history. The specific details of the agreements we reached in the negotiations will be available this afternoon.

In summary, we obtained from the Common Market and other countries tariff reductions and commitments not to increase duties on $4-3 billion worth of annual exports.  In return we granted similar concessions or gave up concessions previously accorded us on $2.9 billion of annual imports.  These agreements were very satisfactory and very important.  We obtained new concessions, both industrial and agricultural, on those very items which are most essential to the maintenance and expansion of our foreign trade, our export markets, and our effort to sell abroad to offset our balance of payments losses.

This was a good indication, moreover, that the United States and the Common Market will be able to work together and bargain together.  Due to the limited bargaining authority we had under the present law, it was necessary to breach the peril points in a number of cases to avoid a complete breakdown in negotiations and to obtain worthwhile concessions for our own businessmen and farmers, but every effort was made to restrict such breaches to items that would not have significant impact upon the American economy.

These agreements, however, are as far as we can go until new legislation is enacted.  The real opportunities offered us by the Common  Market, and to the people of Europe, and the competitive challenge it presents to our enterprise system-all this is still ahead, and will always be beyond our reach, with all of the adverse effects it will have on our economy, unless a strong trade expansion act gives our negotiators the authority they need to speak for our country in these most important matters.

[3.] Q. Mr. President, in connection with your speech last week on nuclear test resumption and the forthcoming negotiations in Geneva, do you think the American public and the public of the world is justified in attaching to the Geneva negotiations any particular hope or expectation that these negotiations will be more fruitful than similar meetings with the Russians in the past?

THE PRESIDENT.  Well, I am sure they attach hope.  Expectations is perhaps another matter. But hope should certainly be attached because these-this meeting is extremely important.  I am not making optimistic predictions about its success, but I could make pessimistic predictions about its failure.

So that we go to the conference trying to get an accord.  That is our interest.  We believe it's in the best interest of the United States, the security interests of the United States as well as the security interests, really, of the entire world.  So we just have to wait and see.  But we're going there with a genuine effort because we believe it's most desirable to reach an agreement with the Soviet Union.  Anyone who has read the history of the 20th century knows that increases of tensions, especially those which are worldwide, which engage great powers, are always dangerous, and when new and unprecedented weapons are thrown into this mix it makes anyone hopeful about Geneva, and the consequent easing of the tensions which would come from an accord.

[4.] Q. Mr. President, Mr. Khrushchev has recently stated in meetings at Moscow that this country is suffering quite a bit from a lack of food.  Now, regardless of whether they ask or not, have you considered the possibility of loaning, selling, or giving the Soviet people any of our surplus food stocks?

THE PRESIDENT.  No, we do send food to Poland, as you know, and have sent a substantial quantity to Yugoslavia.  There is no evidence that the Soviet Union has ever asked for it and my judgment is they do not want it.  I think what Mr. Khrushchev addressed himself to was how they could improve domestic production.  And therefore, in answer to your question, there has been no discussion of it, no consideration of it, and I do take some satisfaction from our difficulties which are overproduction under our free agricultural economy, even though it is a problem which has haunted good men.

[5.] Q. Mr. President, as you know, our rate of economic recovery has been very low indeed, and much less than anticipated.  What further actions do you believe the administration should take now to speed up the slow down in our recovery?

THE PRESIDENT.  Well, I think it's premature to suggest.  I can't accept all the premise of your question.  Mr. Goldberg, the Secretary of Labor, I believe this afternoon announced some figures, which said that the seasonal adjusted unemployment rate of 5.6 percent is the lowest level in 19 months and total employment which is 65,789,000 set a new all time February record.  And I think that we should wait till- let the winter go, and let's see what happens in February and March, then we can make a judgment as to whether there is a recovery.

You will recall that in August and September we had a leveling out, and then the economy took off again in October, November, and December.  In addition, there's– I saw, as a matter of fact, reading the other day in the Wall Street Journal, that profits were up for companies-22 percent, I think the highest in history.  There's our price in the last 12 months, prices only increased one-half of 1 percent, I think, which has only happened in this decade once, in 1955.

There's not an excessively high level of inventory buildup.  I think that Mr. Heller, who has spoken on this matter, who I do not consider a natural optimist-I think he's been speaking what he believes.  And therefore I think that this economy has more vitality in it than some of its premature mourners.

[6.] Q. Mr. President, now that you have seen all the available evidence in the Powers case, do you agree with Representative Vinson that Mr. Powers U-2 was shot down at 68,000 feet by a ground launched rocket?

THE PRESIDENT. Well, I think that the report of the CIA and the comments-the statements which Mr. Powers made, it seems to me, dealt with this matter.  I have no other information beyond what you have seen in those two matters.

Q. Sir, I meant that Representative Vinson said the CIA believes that he was shot down by a rocket fired from the ground.  I was wondering if you have any comment on that.

THE PRESIDENT, I don't have any comment beyond what the CIA has said and what Mr. Powers himself has said.

[7.] Q. Mr. President, could you define for us what might be acceptable at Geneva as a safeguard against secret preparations for testing, and specifically whether this would include an increase in on site inspections?

THE PRESIDENT.  Well, I think that the American negotiators at Geneva will have some suggestions to make in that area, and as this conference is going to begin in a week, I believe it would be preferable to let them make their proposals at that time.

[8.] Q. Mr. President, you have said, and I think more than once, that heads of government should not go to the summit to negotiate agreements, but only to approve agreements negotiated at a lower level.  Now it's being said and written that you are going to eat those words, and go to a summit without any agreement at a lower level.  Has your position changed, sir?

THE PRESIDENT.  Well, I'm going to have a dinner for all of the people who've written it, and we'll see who eats what. [Laughter]    let me state that I would go to the summit if-as you've stated-if some agreements had been made which could be climaxed most effectively by a summit meeting.  I've also stated at an earlier press conference if I thought a trip to the summit might avert a war or if we were faced with an extremely dangerous situation, then I think it would be appropriate to go to the summit without prior agreement.  But I think to go to the summit without having an understanding of what is going to be accomplished there, and some meeting of minds, I think disappoints rather than helps the cause, and that's why I've held the view that I do, and that's why I continue to hold it, and that's why I am looking forward to the spring.

[9.] Q. Mr. President, since a number of governments have expressed their support for either nuclear free zones in different parts of the world or for a so-called non-nuclear club- among those governments, aside from the socialist communities, there is Brazil, Ireland, and Sweden- what are your feelings, sir, about those proposals, and what would be the position of the United States Government at the Geneva disarmament conference in this respect?

THE PRESIDENT.  Well, I think there are two or three different points in the question.  I think the United States- I said at the United Nations that I thought it would be desirable to come to some agreement in regard to the transfer of nuclear weapons from one country to another.  Now, when we get into- so that's one position which the United States has already taken and indicates its support of.  Your other question was in regard to a nuclear free zone, and that, it seems to me, is a matter which must be examined.  What else will be in the zone? What other forces will be in the zone? Where will this zone be? These are matters, I think, that could-will be discussed, I imagine, along with many other matters affecting armaments at Geneva and in other conversations.

But I think that we have to see what the language is, what the proposal is, what the effect of the situation is, before I could answer that question.

In addition, I'm not convinced that this makes a- is a total solution.  If you have a missile that can carry a bomb 5,000 miles, does it really make that much-a significant difference if you don't have a bomb stationed in this area but you have it 5,000 miles behind, which can cover that area?

So, therefore, I think it's a matter which should be discussed at the appropriate place.

[10.] Q. Mr. President, this morning before the Advertising Council you dwelt with some earnestness about the great burdens the United States is carrying.  Are we safe in assuming this is another way of saying that you think some of our friends around the world should do more in the way of helping underdeveloped countries?

THE PRESIDENT.  Well, I'm hopeful they'll do more.  I know that a good many Americans are concerned, as I said this morning, about the balance of payments, and as I have stated, the balance of payments problem of the United States could be settled overnight if we withdrew our security efforts around the world.  It is the combination of the $3 billion that we spend keeping our defense forces overseas, combined with assistance we give in other ways, which provides for our dollar drain.

Now, those countries which are building up their reserves, I am hopeful will be willing and some of them have, France, for example, which has really spent a larger proportion of its national income for assistance to the former French community, really, than any country in the world.  So, some countries are.  But the United States bears a very heavy load, even in the consortiums that we go to, the United States loans frequently are soft, repayable in local currency and the loans of others may be at 3, 4, 5, 6 percent, so that this is a matter which involves us all.

Now, as Western Europe gets stronger and stronger, I'm hopeful that they will play a larger and larger role in this struggle in which we are involved.  Because the United States-the reason our gold drain has been in the last 10 years, is due to this matter.  The balance of trade has been in our favor every year, except one in the last 10 years.

It's been due also to investments abroad and some short-term capital movement.  But if we were not making the great effort we've made, really since the Marshall plan, we would have a major convulsion because there would be a concentration of gold.  Now when we are carrying this heavy load, I would hope that the free countries would work together to attempt to assign this balance evenly.

We don't-we're ready to carry it, in the United States, to the maximum of our ability, but we carry it in Berlin and Saigon, and Latin America, and Africa, and the Middle East, and Pakistan, and India, and In a good many other countries, and this is a matter which should concern all free men.

[11.] Q. Mr. President, there has been a scattering of very favorable news stories out of South Vietnam, but we don't have any overall coverage.  I wondered if you could tell us how the subterranean war is going there, because the Pentagon won't put out anything; and also if you'd want to comment on the possibility of the use of tactical nuclear or anti-personnel weapons in that area?

THE PRESIDENT.  Well, I wouldn't really-or I don't think you could make a judgment of the situation.  It's very much up and down, as you know, from day to day, and week to week, so it's impossible to draw any long-range conclusions.  And on the second matter, it's a-I'm not familiar with it, and it's a matter, really, I think, of the Defense Department, but it has not come to me.  In any case, it's a matter, really, for the Vietnamese.

[12.] Q. Mr. President, to get back to Mr.  Scherer's  question  about  payments  that other nations make.  There have been some suggestions in Congress, as alternatives to your U.N. bonds purchase plan, that part of the United States outlay be in matching funds to what other nations buy or possibly to make a loan to the U.N. instead of purchasing bonds.  Will you comment on these alternatives?

THE PRESIDENT.  Well, they're both before the Foreign Relations Committee.  I felt that the plan we sent up represented the best interest of the United States and the U.N. and was financially sound.  So I would like to stay with that.  Now I think the Foreign Relations Committee has my recommendations and knows my views, and I think they're wholly competent-a very responsible committee-and I think they are wholly competent to make a judgment.  I do hope that we can keep the U.N. moving, and they do depend upon a program of the kind I suggested.  But I think the details I would much prefer to leave to them because it is now in their hands.

[13.] Q. Mr. President, Secretary of State Rusk has said that it is entirely possible that at Geneva there will be discussions about Berlin and Southeast Asia.  Would you favor such discussions at Geneva?

THE PRESIDENT.  I think that if these matters come up and if any progress can be made on them, of course I favor them.  This is not the purpose of the disarmament conference, but anything that can ease relations or anything that could improve the situation in Berlin or in Southeast Asia, of course, ought to be talked about.  I think that's quite obvious and we shouldn't miss any opportunity.

[14.] Q. Mr. President, could you give us any ideas of the areas in which we might explore peaceful operation with the Soviet Union in the exploration of outer space? What your specific thoughts might be?

THE PRESIDENT.  Well, I've written a letter today to Chairman Khrushchev, putting forward some proposals, and I think it will be released as soon as he has received it.  But I do think it should wait till that.  But we did make some suggestions in that letter. 

[15.] Q. Mr. President this is a twofold question: In the event that there is an Algerian, independent Algerian government established, do you contemplate recognizing it? And, second, should that government request or apply f-or economic and military aid, would you grant it?

THE PRESIDENT.  Well, I think that this Matter is so sensitive and coming to such a climax now, and being handled I think with skill, I believe on both sides, that I really think that it would be the wisest course to permit the situation to develop there before we begin to discuss what our actions would be at a later date.  So that I think in the interest of the relations between the different parties involved that I will-but I will be glad to discuss that question as soon as a final solution has been reached.

[16.] Q. Mr. President, the Attorney General, when be was visiting in Japan, received many inquiries about U.S. intentions towards Okinawa, and I believe you had a Presidential body look into this question.  Can you say now what the situation is there insofar as your intentions to give them more self-government?

THE PRESIDENT.  As a matter of fact, the Attorney General said that it was really the matter which came up more in his conversations than any other matter, and is a matter of great concern to the Japanese.  There was a very responsible committee went out and made some recommendations to us, which have been considered by the Joint Chiefs and others, and we are going to have some suggestions to make to the Japanese Government on this matter, though-in the next days-though quite obviously this is a very vital base.  And from that base security is provided for a whole variety of countries in Asia.  And so that we have to balance off the defense needs and also the legitimate interests of the people of Okinawa and of Japan.  We are going to attempt to do the best we can, given those limitations, and make some suggestions very shortly.

[17.] Q. Mr. President, have you any steps in mind to take, any moves to make, if the steel companies and unions do not respond to your view?

THE PRESIDENT.  I'd put that with the France, Algeria, in the sense that I think we ought to wait till we see what happens in the negotiations.  These companies are free and the unions are free.  All we can try to do is to indicate to them the public interest which is there.  After all, the public interest is the sum of the private interests, or perhaps it's even sometimes a little more.  In fact, it is a little more.  But the Federal Government has no power in these negotiations, unless there was a strike which threatened the national health and safety, and that would be sometime late in the summer.  So all we can do is attempt to persuade the parties to go around the bargaining table and point out to them how vitally the public interest is involved.

In the first place, this is a basic industry.  We are in a period of recovery which we want to maintain.  This is going to be regarded symbolically as a test of our ability to manage our economy in a competitive world.  It will be looked on in Europe.  I think the public interest is so involved, I think there's enough community of interest between the company and the union after their '59 experience that I am hopeful they can reach an accord, and I'm hopeful when they go back in March that they will do it.  But we are limited by the Constitution and statutes and proprieties to the areas which I've discussed.  But this-I hope they work it out, because it's in their interest as well as the public.

[18.] Q. Mr. President, the Congress has been in session for about 2 months now, and has not accomplished very much.  Would you care to comment on how you feel about this present pace?

THE PRESIDENT.  Well, I must say that always in the first part of March we read about- that the Congress hasn't done much, and in fact last year at this time I think that not a single bill had been passed of any proportion-at the end of the year almost 30 bills.  Now we have taken action in four or five areas.  The higher education has passed both the House and Senate, and the conference hasn't met.  I think the conference has come to a conclusion on the manpower retraining, the pension and welfare disclosures.  The tax bill is about to come to the floor.  I think that legislation is going to come really pouring out of these committees in the next month or 2 months.  So I don't have any criticism at all of the pace of the Congress.  The test would be whether the legislation which involves not only the well-being of a good many Americans, such as medical care for the aged, but also those pieces of legislation which will help us fight the next economic turn down-whether those pieces of legislation will be passed.  And I'm hopeful that the Congress will consider those very carefully or their alternates.  But I must say I think you cannot- I think the Congress is moving ahead.  I think in some ways it's further ahead than last year, and I think we're going to get a good deal of legislation from the Congress this year.

[19.] Q. Mr. President, I know you don't want to prejudice your position in advance of Geneva, but I want to ask you this: Prospects for disarmament and/or a nuclear test ban treaty are indeed pretty dim.  What happens if those prospects don't brighten? Do we continue testing? Do the Russians continue testing, escalating the nuclear arms race, ad infinitum?

THE PRESIDENT.  I suppose that is certainly the danger, and the reason why we are attempting to get an agreement on the cessation of nuclear tests.  The reason why I said I thought it would be perfectly proper for us to discuss Berlin and Germany or South Asia is because these matters directly influence the progress of armaments.  Without the Korean War-after all, our budget went from $14 billion up to what it is now, and we ourselves have had to spend a good deal more because of Berlin and South Asia, so that I do think there is a direct relation between these political questions and armaments and disarmament.  But if we fail to get an agreement on testing, then of course, as I've said, we test.  And I presume that others will test.  And I regard that as a very risky, in the long run, procedure for the future of the human race.

On the other hand, if we do not test and others test, that has a risk.  And I made the determination that that would be the greater risk.  Now we're going to try here before the end of April, and we'll also continue trying after the tests begin, if we're unable to get agreement before then.  Because I'd much prefer a test agreement than to continue this kind of competition.

[20.] Q. Mr. President, strong forces in Congress are talking about legislative action to direct you to spend procurement funds for the B-70- I wondered if you could give us your thinking on the B-70 substantive issue, and on the power of Congress to direct you to spend money in such a way.

THE PRESIDENT.  Well, on the substantive issue, as you know, we put in funds to develop three different prototypes of the B-70.  And the-it was proposed by the Air Force that they would have 140 B-70's, which would cost $10 billion, which would be ready by 1970 or '71, and that is a large sum of money, and we have a good many manned aircraft.  We have over 640 B-52'S as well as an extensive missile armory, which is coming in: Polaris we have now, Minuteman we will have, Titan we have now, Atlas we have now.  So the question really is whether we should put that large sum of money into manned bombers which will be available in '7o and '71- That's the first point.

The second point is that, according to those who have studied it in the Defense Department, we really can't spend the money now.  A good many of the equipment-much of the equipment which would go into a B-70, some of it, first, hasn't been developed yet, and we really won't have our major flights in the B-70 till '63 and '64.  Now if it's decided in '63 and '64 that we have a strategic need for the B-70, we should then go ahead with it.  But to get the money today, when we haven't developed the prototype, seems to me to be-or at least seemed to Secretary McNamara, who has given it a good deal of study, and to General Lemnitzer, and, I think, to Admiral Anderson and the other members of the Joint Chiefs-Decker-with the exception of the Air Force, it does seem to me to be a- not the most judicious action.

Now, the Congress has a great authority and responsibility.  They know a good deal about it.  So I think that this is a matter which I hope we can talk about-the Appropriations Committee, the Armed Services Committee of both the House and the Senate, and we can get a better judgment as to what the language will be at the end.  But I hope we take a cold look at when this force will be ready, what position it's in today, whether we are prepared to go ahead with production, and what will be the use of this particular force in 1970 or '71 with all of the progress that's being made in missiles, ground-to-air missiles against planes, and in view of the fact that we are going to spend over a billion dollars equipping our present force of B-52's with Skybolts, which will extend their life and their effectiveness.  But in the final analysis, this is a matter on which I have relied very heavily on Secretary McNamara, in whom I have the greatest confidence.

[21.] Q. Mr. President, the pictures of the Attorney General's overseas trip showed him saying that he was there as the representative of the United States Government.  Now, outside of speaking to students, will you tell us what his mission really was and what he achieved?

THE PRESIDENT.  Well, I, his mission was to-as I said at the previous press conference, his particular mission and interest was to try to talk to students and to intellectuals and others who are among the future leaders of these countries and whom we have not always enjoyed, for reasons which have not always been precise to us, the happiest relations.  So I think that that stimulated his visit.  He is an official of the United States Government, and I think that those who are in official positions were anxious to talk with him and discuss their problems.  The fact of the matter is that five other Cabinet officers went to Japan last fall.  I don't know whether you-and a good many Cabinet officers, Mr. Goldberg, Mr. Hodges, have been to Africa.  I think that people who hold positions of importance in the American Government ought to travel, and they learn.  I call on them for advice as members of the Cabinet, or the Security Council, and, in addition, they tell these people that we have a very vital, moving country here.    And I think his trip was very worthwhile.

[22.] Q.  Mr. President, against the background of the Brazilian seizure of an American-owned telephone company, Congressman Adair, and I believe Senator Long, and others, have introduced legislation which would, in effect, cut off assistance from the United States to nations where American assets have been expropriated without compensation.  Would you comment on the desirability of that, and also on the impact of that seizure on America's– on the American public's support of the Alliance for Progress program?

THE PRESIDENT.  Well, now, as you know, the telephone company was seized by the governor of a province who has not always been identified particularly as a friend of the United States and we have been attempting to work out an equitable solution with the Brazilian Government.  Nobody has ever questioned the right of any government to seize property, providing the compensation is fair.  The United States is involved with the Brazilian Government in attempting to adjust this matter.  I can think of nothing more unwise than to attempt to pass a resolution at this time which puts us in a position not of disagreement with a governor of a state, who is not particularly our friend, but, instead, really, with the whole Brazilian nation, which is vital and which is a key and with which we must have the closest relations.  So that we want this matter settled.  It is in our interest and in the interest of Brazil.

Private capital is necessary in Latin America.  There isn't enough public capital to do the job.  And, therefore, we are working on it and the Brazilian Government has been responsive in attempting to work out a satisfactory solution.  President Goulart is coming here in April, and we will be discussing many matters which involve our relations.  And I must say that if you look at the map and realize the vitality of Brazil, I think that we ought to keep a sense of proportion.  We don't want to make the work of those who dislike us easy by reacting to things, which happen in a way which strengthens them and weakens the influence of the United States.

[23.] Q. Mr. President, you have suggested that the Indiana Dunes, a natural area comparable to that on Cape Cod between Nauset and North Truro, be reserved to the Nation as a national park.  It is now in danger of being destroyed by the erection of a steel mill and an artificial harbor.  Do you think there is any chance of Federal action to save this area for the Nation?

THE PRESIDENT.  Well, we made our recommendation and we'll follow and see what the Congress does with it.  It's highly controversial. But we expressed what we thought was in the best interests, with the large number of people who live in that immediate area. And we'll continue to watch it through the Congress.

NOTE: President Kennedy's twenty-sixth news conference was held in the State Department Auditorium at 3:30 o'clock on Wednesday afternoon, March 7, 1962.