White House Encounter

A try at building support

A procession of limousines crammed the White House driveway last Friday, as 50 of the most powerful leaders of U.S. business accepted an invitation for an off-the-record exchange of views with ranking Administration officials. Among them were the chiefs of Exxon, General Electric, Du Pont, Merrill Lynch, National Steel, B.F. Goodrich and Boeing. The Administration was engaged in one of the most ambitious public relations campaigns to be aimed at the business community since Lyndon Johnson's day. The goals: to build support for Carter's tax package and to reassure business leaders, who have been unimpressed with the President's handling of the economy, that the Administration wants them as allies. Similar meetings are being held with leaders of labor, blacks and other groups.

When the business leaders took seats in the State Dining Room, Commerce Secretary Juanita Kreps conceded that the Administration had been criticized for its inability to communicate with the business community, its lack of a program on which businessmen could base their plans, and its disregard for the private sector. But, she added, "we have made substantial progress in all three areas."

Treasury Secretary W. Michael Blumenthal chided the businessmen for so solidly opposing the President's tax bill. In reply, some of the guests asked why, at a time of record trade deficits, the Administration was seeking to end the provision deferring taxes on some export profits and earnings abroad. Blumenthal argued that other offending proposals--notably the recision of tax advantages for capital gains--had been eliminated. He urged the businessmen to support the provisions they approved of rather than oppose the entire bill. But when he said the economy was doing well in all respects except the stock market, one guest cried: "In effect we are in liquidation! How can you say we are doing all that well?" The mood became even chillier when discussion turned to Carter's energy program. "It was about as intense and hostile as anything I have ever observed," said one participant. Charles Schultze, chairman of the President's Council of Economic Advisers, put the blame for the delays in passing the energy bill "at the other end of Pennsylvania Avenue" -- meaning the Senate. Protested one business leader: "The problem is right here."

Jimmy Carter popped into the 2 1/2-hour session for only five minutes. As he spoke, a helicopter settled on the South Lawn of the White House to whisk him and Rosalynn to Camp David for the week end; parts of his remarks were drowned out by the roar of the rotors. He urged the businessmen to support the Panama Canal treaty. Commented Eastern Air Lines Chairman Frank Borman, who would have hoped for more forthright pronouncements on energy: 'Tm all for the treaty." White House encounter sessions may be important in establishing communication between the Administration and business. Some corporate chiefs say that relations have improved lately because Carter and his Cabinet are beginning to listen to them. William Hewitt, the chairman of Deere & Co. (farm equipment), reflected on last week's Administration spokesmen: ";They said nothing new, but there is no disadvantage in that." Added Roger Birk, president of Merrill Lynch: "Such communication is a positive thing, and it does help business confidence."

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