Cautious, Candid & Conciliatory

Restrained in tone, candid in content, almost Trumanesque in verbiage, Lyndon Johnson's fourth State of the Union address was a marked departure from the sagebrush grandiloquence that has infused most of his major pronouncements as President.

Only once last week, in an impromptu departure from his 13-page single-spaced text, did Johnson mention the Great Society. He invoked God just once and evoked youthful memories of poverty and the Pedernales not at all. What he did present to the 90th Congress--and a prime-hour TV audience estimated at 65 million--was a pragmatic, sometimes prosaic outline of legislative aims tempered both to the conservative climate of Capitol Hill and the economic realities of a society that is inextricably involved in a costly war abroad while deeply committed to social reform at home.

Whether describing his Administration's domestic programs or its foreign commitments, the President offered no reason for retrenchment or retreat. On the contrary, his proposals for the coming year envision a continuing if judicious expansion of past and present canons: further development of the model-cities program, extension of Medicare, strengthening of the Head Start program, new teeth in consumer protection, more national beautification, improved partnership between federal and local governments.

"Whither Tending." His major surprise--and it was a mild one--was his request for a surcharge of 6% on both corporate and individual income taxes to go into effect July 1 and last for two years, or less if the Viet Nam war ends. Beyond that, the speech was cautious and uncontroversial.

The President took his keynote theme from Lincoln: "We must ask 'where we are and whither we are tending.'" Indeed, until Johnson actually began to speak, almost no one had any notion whither he would tend. Newsmen got no hint of the President's plans during his long, sequestered sojourn at the L.B.J. ranch. At the White House, security precautions were so rigid that reporters were barricaded out of hearing range of the typing pool so that they could not eavesdrop on secretaries proofreading the speech aloud. Johnson held his options open until the eleventh hour, ordering innumerable page-by-page rewrites--mostly by outgoing Press Secretary Bill Moyers, chief writer of the speech. Not until 5 1/2 hours before he was to speak did he iron out the final dimensions of the tax hike. Even as he dressed in his White House bedroom, an hour before leaving for Capitol Hill, Johnson was scribbling new lines on his copy.

Lessons of Failure. When he entered the chamber of the House of Representatives, the assembly rose and gave him an unusually warm round of applause that lasted for nearly two minutes. As the President stood on the podium, he looked healthier than he had in many a month. His hair was a bit thinner and greyer, but an expensively tailored suit and a specially cut shirt collar helped give him a trim look. His manner was that of a man who had made up his mind to ignore outrageous slings and arrows and concentrate on the duties before him.

Johnson's speech gave surprisingly short shrift to past achievements. And, possibly in reaction to recent complaints from Democratic Governors, the President was disarmingly frank about the problems created by the avalanche of social legislation enacted under his aegis. He allowed that his Great Society "required trial and error, and it has produced both." And he averred with unwonted humility: "As we learn through success and failure, we are changing our strategy, and we are trying to improve our tactics. . . . Where there have been mistakes we will try very hard to correct them."

Modest & Esoteric. Johnson also conceded that his "greatest disappointment" in the economy had been the year's "excessive rise" in interest rates and the subsequent tightening of credit. Admittedly, there had been bright spots; and he reeled off a Johnsonian catalogue of positive statistics to prove it: unemployment at the lowest rate in 13 years, after-tax family income up nearly 5% over last year, corporate profits up more than 5%, G.N.P. up 51%, farm income up 6%. To bolster his request for a tax rise, he dispensed some revealing budget figures. Federal expenditures for fiscal 1967 (which ends June 30) will reach $126.7 billion, nearly $10 billion more than expected revenues; spending in fiscal 1968 will rise to $135 billion, causing a deficit of some $8 billion.

Many of his proposals seemed surprisingly modest and oddly esoteric for the occasion. He recommended new help for American Indians and migrant workers, research aimed at preventing massive power failures, tougher safety precautions for natural-gas pipelines, development of educational television. He urged legislation to outlaw "all wiretapping, public and private, except when the security of the nation itself is at stake." Another unexpected recommendation was Johnson's plea for an "all-out effort to combat crime." The President expounded on the subject for four fervent minutes, devoting more detail to the subject than any other single item except the war. He outlined a "Safe Streets and Crime Control Act" that would offer federal grants to local governments to help pay for statewide "master plan" crime control, new communications and alarm systems, new crime laboratories and police academies. The President also surprised Congress with a proposal to combine in a single Department of Business and Labor the interrelated and often overlapping functions of the less than potent Commerce and Labor Departments. Though the plan had enthusiastic backing from both Commerce Secretary John Connor (who coincidentally announced last week that he wants to resign anyway, some time in the next couple of months) and Labor Secretary Willard Wirtz (who has also told the President that he would like a job change), its reception on Capitol Hill was lukewarm.

"Threatened Planet." Johnson devoted the last half of his speech to a conciliatory report on foreign policy. "We are in the midst of a great transition," he said, "a transition from narrow nationalism to international partnership, from the harsh spirit of the cold war to the hopeful spirit of common humanity on a troubled and a threatened planet." He spoke hopefully about U.S.-Soviet relations: "We have avoided both the acts and the rhetoric of the cold war; when we have differed with the Soviet Union, or other nations for that matter, I tried to differ quietly and with courtesy and without venom."

He again urged Congress to pass the East-West trade bill, which it rejected last year and is even less likely to adopt in 1967. For good measure, Johnson even spoke understandingly of Red China's need for "security and friendly relations with her neighboring country." He pointedly refrained from announcing any decision to build a U.S. anti-missile system--a peaceable gesture he followed up at week's end with a message to Moscow that urged the Russians to defer deploying their own anti-missile defense in the interest of furthering world disarmament. "We have the solemn duty," said the President, "to slow down the arms race between us, if that is at all possible, in both conventional and nuclear weapons and defenses."

As for Viet Nam, Johnson neither apologized for U.S. conduct of the war nor attempted to prettify the prospects. Despite heavy pressures for a sterner stance from military and congressional advisers, the President announced no new strategies and no new commitments. "I wish I could report to you that the conflict is almost over," he said somberly. "This I cannot do. We face more cost, more loss and ``more agony."

"Mental Indigestion." When the President wound up his 75-minute speech, he was rewarded with polite applause--even though many in his audience had sat through the last half-hour in a glazed slouch or, in a few cases, deep slumber. Snapped Senate Minority Leader Ev Dirksen at a post-mortem press conference: "It was too long. It gave me mental indigestion." House Minority Leader Gerald Ford criticized the President for trying to finance both "rifles and ruffles."

In general, nonetheless, Johnson drew surprisingly little criticism. The New York Stock Exchange, which had begun a rise six days earlier, dipped quickly the morning after the speech but rallied within hours and, in a gigantic trading day, closed 8.35 points higher than it opened, and then kept up its steam all week (see U.S. BUSINESS). On Capitol Hill, key finance-committee leaders from both parties predicted that Congress would probably not rush consideration of a tax hike, since the President had not indicated that it was an emergency measure. But they were confident that an increase, if still necessary by spring, would be approved without serious trouble.

Steady Hand. Actually, the President had gone to great lengths to get a careful consensus from leading economic experts on whether he should raise taxes: he insisted on signed memos of opinion from every person he consulted, both inside and outside the Administration. All agreed that a tax boost was in order. Some non-Administration economists argued that the crimp on income could brake the business slowdown to the danger point. But Johnson also asked for an average 20% rise in Social Security benefits. It was an unexpectedly large increase that will pump some $4.1 billion into the economy and may in fact bring enough new money into the market place to offset the drain of new taxes. Politically, a fresh rush of taxes into the Treasury should give Johnson some maneuvering room with the 90th Congress when it comes time to debate Great Society spending.

If only by its circumspection, the President's address seemed to rebut speculation that he would not seek another term. Rather, Lyndon Johnson was clearly intent on showing his critics that he has a steady hand on the controls at a difficult period in U.S. history. It is, in Johnson's words, "a time of testing, a time of transition"--for himself no less than for the nation.

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