The Presidency: State of the Union

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Every few words were underlined for emphasis. Notations in the text said "Pause," "Look right," and "Look left." And like the onetime high school elocution teacher that he is, President Johnson delivered his first State of the Union message in a style that had oratorical flourish without sounding strident.

The President's aim was to convince Congress that his Administration will be frugal. As he revealed the big surprises of his speech, he stared straight out at such economy-minded legislators as Virginia's Senator Harry Byrd and House Republican Leader Charles Halleck. The fiscal 1965 budget that Johnson will send to Congress next week, he said slowly and stressing every word, will "call for total expenditures of $97.9 billion—compared to $98.4 billion for the current year, a reduction of more than $500 million. It will call for new obligational authority of $103.8 billion —a reduction of more than $4 billion below last year's request of $107.9 billion. It will cut our deficit in half, from $10 billion to $4.9 billion."

All this depended, of course, on revenue gains expected from the economic growth to be spurred by the tax-cut bill still pending before Congress. "That tax bill," said the President, "has been thoroughly discussed for a year. Now we need action. The new budget clearly allows it."

The Cutbacks. The budget had been Johnson's chief preoccupation since taking office. On Sunday, Nov. 24, just two days after he succeeded President Kennedy, he held the first of countless conferences with Budget Director Kermit Gordon. Several days later, the White House let it be known that because of built-in spending increases—about half of them required by legislation passed last year—it would be all but impossible to get next year's budget much below $103 billion. As late as New Year's Eve, while at his Texas ranch, the President indicated to reporters that his budget probably would come to about $100 billion.

Where did the extra savings come from? The biggest whack, totaling about $1 billion, was in Defense Department spending, owing mostly to Defense Secretary McNamara's campaign for better procurement practices, the shutdown of unneeded military bases, etc. Civilian employment in the Defense Department will go down by 17,000 to 990,000; but because of increases elsewhere, total federal employment will only be cut by 1,200.

The Atomic Energy Commission also gets hit. Said the President in his speech: "We are cutting back on our production of enriched uranium by 25%, shutting down four plutonium piles." It is widely agreed that the U.S. has enough enriched uranium to suit any foreseeable purpose. Still, one argument against such a cutback was that it would mean job losses in places where plants were closed. The President answered that one by telling aides, "We're not going to produce atom bombs as a WPA project."

The Attack. While many other departments and agencies will lose money under the new budget, others inevitably will gain. Among these is the National Aeronautics and Space Administration, which will go up by $50 million to $4.5 billion—and even that is not what NASA Director James Webb wants in his effort to get to the moon by 1970.