An Interview with Ronald Reagan

Despite daunting problems, he is comfortable with his course and his job

After nearly two years on the job, Ronald Reagan agreed to discuss his views of the presidency with TIME Senior Correspondent John F. Stacks and White House Correspondent Douglas Brew. Excerpts from the interview:

Q. As you approach the midpoint of this term as President, one of the things that everybody notices, especially compared with some of your predecessors, is that the burdens of the presidency do not seem to have got you down. You really look unchanged. Your optimism and good humor seem to be intact. Is that impression correct? Are you that pleased with the experience?

A. Well, I don't say that there aren't problems that worry me, that don't have to be solved. But I don't know, I guess I learned something when I was Governor of California for those eight years. I made a decision then, and I have repeated it now, as kind of a campaign promise to myself, that I didn't want to hear any counsel on any issue as to what might be the political ramifications of it, or how it might affect future elections or anything. And I made a promise that I would, to the best of my ability, make any decision that had to be made, on the basis of what I honestly believed was right or wrong for the people. I found then, and it continues now, that you sleep very well if you do that. I think what may happen to some people is that when they start thinking ahead and start looking at an issue and a decision as to how it is going to go over politically, that's when I think tension must mount. It must create an additional strain that shouldn't be there.

Q. Because it's impossible to know how something will work out politically?

A. No. You try to figure out in your mind what is best. That is why the hardest decision is the one that has right on both sides. But once having decided what you feel is morally right for the people and the best solution for them, then you go forward with it. This doesn't mean you won't make mistakes. You may pick wrong. But I think I found out that the people seem to understand if you do that. They can accept a mistake, and they don't jump on you for having made some political decision they disagree with.

Q. You sit here at the hub of this Government, and you have all these information-gathering capabilities and analytic capabilities at your disposal. Do you think that any of your preconceptions about problems and policies have been wrong?

A. Well, not as to basic philosophy: my belief that Government in recent years has been more a part of the problem than part of the solution in many ways. No, I haven't changed my mind in those ways. I think, yes, there are perceptions when you get in. I know that out on the mashed-potato circuit for many years, when I wasn't in office, I used to refuse to make certain criticisms--and I'm kind of grateful now--on the basis that only if you had access to all of the information that [a President] has are you qualified to come out and harshly criticize. And I have found that is true. I find myself now sometimes listening to a panel show or something, saying that they just don't understand. They don't know the why of this or that or why such a thing as they are suggesting could not be done.

Q. Is there an example that you can think of where your preconceptions coming into office have not quite matched the information you now have, maybe in economic policy or some foreign affairs questions?

A. Well, I suppose right now one of the things would be the economic question. I don't suppose that I had anticipated that there is structural unemployment and a structural part of the deficit that has nothing to do with the recession. It is extremely difficult to just say, well, if I decide to cut this budget to reduce the deficit, I can cut this spot here or there. I don't think I was prepared for how much of the budget was built hi by the original legislation, how many programs were instituted, particularly in the nondefense area, which is 70% or more of the budget, with features in them that made them automatically increase. So you look and say, wait a minute. If there were no recession, the budget would keep increasing at a rate that is higher than the normal increase in revenues, and you find that somehow you have got to find a way to make a structural change that will require the Congress agreeing not just to a cut in the budget but to actually changing the structure of a program. Now, I said this about unemployment also. It is true that if the recession ended tomorrow we would have a higher rate of unemployment than we have considered normal, but the jobs will not be there when the economy comes back because of a technological change, the whole shift in the type of jobs. That is why we can have a 10.4% unemployment rate,*and yet every Sunday have scores of pages in our metropolitan papers of help-wanted ads. What we need is a structural change in teaching and instructing, in training people to fill [these jobs]. I won't say that the jobs are entirely new, but let's say the number of them has increased. Three million of our unemployed in the past two years are not people who have lost their jobs at all. They are newcomers to the work force, for whom we have not created the new jobs they require.

Q. Some people say you have a knack for screening out information or impressions that are negative or run against what you believed beforehand. Do you think that is true?

A. No, not really. I don't say that I don't ha veto have some things explained to me, and that's why we have the kind of Cabinet operation we do, and that's why we picked the kind of people we have in the Cabinet, because of their expertise in those fields. I couldn't possibly be an expert in all of them. So I depend on them to get an explanation for me.

Q. But you don't think you are bad at getting bad news? I mean, don't you keep bad news away as a matter of self-preservation?

A. No. Maybe some have misinterpreted what I have said on a number of occasions. My own education is in economics, and I therefore feel, not that I am a master of economics but that I understand the shortcomings, some of them, of the science itself. It's an inexact science. The law requires, for example, that in our budgeting we must, for the sake of the Congress, project our budgets out five years and what the deficits or surpluses will be. I don't think any economist can.

Q. Does that mean that you simply don't believe the deficit projections that you are getting now?

A. Oh, I believe the immediate--I think for a year ahead or so, say, and I can understand the problem that has to be met. But take one example of what we have been criticized for. In February 1981, barely in office, we came in with an economic plan, much of which we have put into operation now. We based that plan on all the economic forecasts and all the indices that we had available at that time. What I am saying is that there are imponderables that no one can foresee. Now everyone points to those forecasts and says, "Oh, how optimistic you were." Yet we weren't overly optimistic, based on all the indices we had to go on. But for several months, in pulling down the great expanse of the money supply that had been created hi the last six months of 1980, it was pulled down way below the targeted growth rate, and it was held down there [by the Federal Reserve] for so many months that of course there was a scarcity of money. The high interest rates did not let up. And inflation was lowered faster than we had anticipated, even in our optimism. That alone reduced our estimated revenues, as we have seen in 1981. We didn't know we were going to get down so fast and so far. Now in one way we were overjoyed to get rid of it [inflation], because I think it's a curse that has caused the worldwide recession. All right. The deficits for the next five years out are horrendous. And we know that the immediate ones are there because those facts are going to hold. But to project out that far ignores imponderables. There are signs that indicate a change in the recessionary status. I have to say there is a possibility that this economy is not going to stay at the level we are pessimistically predicting, that it is going to improve. So what I am advocating is that we not let ourselves get so hypnotized with the deficit, serious though it may be, that we make unwise decisions that would create what we've had in the past--temporary, quick fixes for this immediate problem. We recognize that the way out of our problem today is an improved economy. Let's continue to make every decision based on not a temporary fix but on what we believe, in this economic system of ours, will improve the economy.

Q. Did you think the Fed was too tight, then, with its monetary policy last year, and do you regret generally supporting that policy?

A. It wasn't a question of supporting it. The Congress has made the Fed absolutely autonomous. All you can do is advance opinions. You can talk to them and say, "Why are we down here in a time of reces sion, holding the money supply down so far?" I can't refer to it as saying it brought on the recession, because we had this recession coming on since 1979. You have only to look at the statistics of 1980 to know that was a recession. In fact, I at one time called it a depression. Everyone wanted to scold me for it, but when I was in Flint, Mich., with unemployment at 20%, I figured that was a depression.

Q. Would you add defense or tax options into that misguided quick-fix category?

A. Let me say this. To have your eye on the deficit with regard to defense is to ignore, as some predecessors have, that the primary objective of Government must be the protection of the liberties of our people. The No. 1 priority of the Federal Government is national security. Therefore defense cannot be looked at as a part of a budgetary solution. Defense must be looked at as to what needs to be done to ensure our national security. This doesn't mean that if you can find places--and we are trying constantly, and Cap [Defense Secretary Caspar Weinberger] has been successful at it--where without reducing the rebuilding that we think has to be done, if we can find savings, fine. We will find them. We don't want to waste money, and we wouldn't do that. We shouldn't do that, even if there is no recession. But national security cannot be used, turned on or off, just to suit some problem of a deficit or balancing of a budget. And I made this clear all through the campaign. The answer to less defense spending is to persuade our potential adversary in the world to join us in a reduction of armaments that is verifiable and mutual, and this is what we are trying to do. Now if they see us abandon our effort and unilaterally give up things instead of mutually trading them away at the negotiating table, then we are that much farther removed from finding the day when we can have a legitimate reduction in arms costs.

Q. Many people on your staff have suggested that as President it is not the power to make decisions that you like most, but rather the chance to sell those decisions to the American people that really attracts you. Is that a fair assessment?

A. No, not really. I think the thing in this job is, finally, instead of just talking about issues, to be able to deal with them, to try to get something done. That is the big kick. It isn't just the communicating. That's a part of the game.

Q. One quick question, Mr. President. Will you run again in 1984?

A. Well, that's a maybe answer. You have to wait until it's closer to the time, and see.

*Figures announced Friday put November unemployment at 10.8%.

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