(00:00:00) Live broadcasts of the Minnesota meeting are made possible by the Twin Cities based law firm of Oppenheimer wolf and Donnelly in recognition of its 100th anniversary. Good afternoon. I'm I'm John Morrison retired chairman of Norwest Corporation and a member of the Minnesota meeting board of directors. It's a real pleasure to welcome all of you to the Minnesota meeting today. We also extend a Welcome to our radio audience throughout the Upper Midwest who are listening to this program and Minnesota Public Radio, the live broadcast is sponsored by the Oppenheimer wolf Donnelly Law Firm. I especially want to greet and welcome the guests from Miller Schroeder and from the Anoka County Chamber of Commerce. Today's speaker Alexander Haig is well known for his many years of service to this country a full General General Haig served in the military for 30 years ending his service in 1979 with a four-year post as Supreme Allied Commander of NATO He has served under three presidents in a variety of roles. Most recently as the nation's 59th Secretary of State under President Reagan. Today, we look forward to General hague's outline of what he sees is the foreign and domestic policy challenges the United States faces in the coming years during General hague's talk. Please jot down questions on the white index cards at your table and then hold them up during the question and answer session Jean King president of communicating and Jane Mara SEC executive director of the Minnesota meeting will move through the audience with microphones and approach those of you with raised cards. It's now my great pleasure to present to you General Alexander (00:01:56) Haig. Thank you very much. John first I want to thank you for that generous introduction and this wonderful group here at the meeting for your warm reception. I want you to know it's the kind I so richly (00:02:19) deserve. (00:02:22) And so infrequently received. John I think it's the second best introduction I've ever had the best was in London a month or two ago when my host failed to show and I had to introduce myself. Now I know this is a very distinguished audience all affiliated with the chamber that has sponsored this wonderful series that has had such a tremendous impact on the community the state and I must say Nationwide. In fact, I don't think I've seen so many distinguished Americans in one room since Henry Kissinger dined alone in the Great Hall of Mirrors. (00:03:08) Yeah. (00:03:11) During the recent campaign for the presidency my like the Ring of that. Some smart aleck pundit wrote In The Washington Post that politics is the only game in America where The Spectator always loses. Now, that seems a little sharply drawn and I must say however in my experience life is a game where often more often than not The Spectator will do And so your chamber movement here throughout America, especially in this region. These meeting sessions which expose you to the views of the very disciplines which comprise the Human Experience in America serve a very important role because they bring each of you out of the role of spectator and into the role of (00:04:02) participant. And (00:04:05) in my experience participants may have a setback now and then but in the long run they seldom lose. So I congratulate you for your organization and your effort here in the state of Minnesota now speaking of politics. You probably derived from my curriculum vitae that I've had trouble holding a job over the years. And it's true. I've retired five times. I think I have two more coming and as is my won't on such occasions. I was fingering through the New York Times one adds last fall. I discovered a new job opening up in Washington and 1988 and believe me the Benny's are magnificent prestigious address on Pennsylvania Avenue. Motor pool of your own air force of your (00:05:00) own (00:05:02) and in my case. I've been assured that no one will ever again Ask me who's in (00:05:07) charge. (00:05:17) Now, I make no bones about being a Republican and those of you are of democratic persuasion in the audience. I know will forgive me. But we Republicans have had a rather rough year. We witness the non deal deal with danilov near Miss at wreck Levesque and thank God it was a Miss. We had the disinformation program with Libya. And now we have the great deranian, brouhaha. Incidentally I call it a brouhaha because if you call in an affair these (00:05:52) days, (00:05:56) especially in Christian circles. It takes on rather ownerís connotations and if you call it an incident while you're of course guilty of trivializing it so I call it a brouhaha because nobody knows what a brouhaha is. But any event this sequence of events has led many Republicans to wonder whether our president who is after all the oldest living incumbent to ever occupy. The Oval Office has begun to Lost His to lose his grip. Now I want you to know I was with him the other night in Washington and this is not the case. It was at the annual Gridiron dinner sponsored by the owners managers Publishers of the American (00:06:40) Media. (00:06:43) It constitutes usually a roasting of presidents and cabinet officials and this year it went on particularly long and our president was in the audience sitting there's to be the final speaker and vital 11:20 that night. Jim Wright that heavy spending heavy taxing speaker of Our House of Representatives got to his feet to introduce the president. He said mr. President. He said I understand you stay abreast of current affairs by having everything reduced to three by five cards, which you take home with you at night and during the commercials in the television shows you riffle through the cards to stay abreast. President got up without skipping a beat. He said Jim you're wrong. He said I just love the commercials. I never miss them. He said I riffle through the cards during the (00:07:40) news. (00:07:44) Hey that said you know when it's rainy and thing happened I figured I had four options. Option one was to do to deny. I knew anything option two was to admit I knew everything. Option 3 was to admit I had known everything but it's just I had forgotten. Option 4 was all of the above so I chose it and you know he did. now The events. I've just cited. remarkable in their humor, but a source of concern in their substance and today as we look at the future of America and the wanting Monson hours of the Reagan presidency. I think it's important for us to reflect for a moment or two on where we have been in order to best assess where we might best go in the future. I like to think of the experiences of Oliver Wendell Holmes some years ago. What an advanced stage after he had retired from the bench found himself traveling on a train one (00:08:53) day (00:08:54) as the conductor came down the aisle collecting the tickets. He noticed the old fellow fumbling through his pockets unable to locate his ticket recognizing him. He went up. He said don't you worry? Mr. Justice. You don't need a ticket on this train just mail it to us when you find it the old fellow looked at and he said Son you don't understand my problem. It's not my ticket. Should I just don't remember where I'm going? now if Americans think back to the decade of the 70s when that period that former President Carter described as the great malaise. Which he attributed to fundamental failures in the character and performance of the individual citizens of this country. We think about the domestic scene characterized by double-digit runaway inflation double-digit unemployment. Declining economic growth levels constrained on the One Hand by Access Federal Regulation and on the other by a tax burden. On the corporation and the individual that made it increasingly difficult to invest in America's future. When one? perceives the American position abroad and I saw it firsthand because I lived abroad in those troubled days. America was viewed as a helpless giant a source of contempt by those who do not share our values and a source of disobey and concerned by those who do If you'll think back to that period from the disastrous conclusion of our involvement in Southeast Asia to the turn of this decade hardly a six-month period passed that we did not as a nation experienced a profound setback to our interest abroad. starting first with the fall of Angola Ethiopia Southern Amon the efforts to overtake the status quo in Northern Yemen the over running of Competency of by a Hanoi a Tibet aided and abetted and directed by the Soviet Union the Soviet interventions in Afghanistan, which continue today as I speak. The fall of the Shah of Iran and his replacement by a month mindless fundamentalist fanatic who today threatens peace and stability throughout the Middle East. The resumption once again of hyperactive Soviet directed Cuban implemented interventionism. In the internal affairs of our Central American (00:11:41) Republic's (00:11:44) now these were the manifestations of a vision of America. Which I considered to be fundamentally (00:11:53) flawed. we witnessed in (00:11:57) the turn of this decade. Lads most by the historic dialectic which has saved us from Extremes in the past and I think Visionary statecraft and effective leadership by Ronald Reagan a Renaissance of the American Spirit. The ingredients of that experience of that Renaissance I think are fundamental as we assess. The directions this nation should take in the period ahead and post Reagan America. (00:12:30) First (00:12:32) the essential ingredient of that Renaissance was that we turn to page. In that period in our history in which we seem to condemn traditional American values American institutions, even the sacred unit of the American family and our leaders for every setback that we experience. Well happily, we turned the page on that Grim period and it's once again. contemporary logic and propriety for as a nation to be proud of our values which have nourished this country through its 207 years of progress and history. To reflect favorably on the essential aspects of the American family as The Cauldron and the receptacle that transmits these values from generation to generation. To be proud of our flag. To be proud of our athletes and international competition. Yes, and even to pay respect to that grand old lady this past July 4th in New York Harbor. Now, this is an America of the Renaissance which in my view is absolutely essential if we are continue to successfully meet contemporary challenges. There is a second aspect of this Renaissance Which is far more important when it comes to the perspective of America's youth. And that is that during the same period we have turned a page on that Grim period in our history which was fed by the Grimm malthusian conclusions of the club of Rome in the early 70s, the Jimmy Carter study of the year 2000 when we told our (00:14:22) youth (00:14:23) that they were going to inherit an America that has run out of food had run out of energy and God forbid was even running out of bed space. Is it any wonder that during that trouble decade? So many of our youth became estranged from the values that nourish this country and from the families and the family circles that spawned them when we told them that their legacy As Americans would be no more than the anguishing redistribution of ever-declining assets and opportunities. What a tragic erroneous message for our future Generations. under a form of statecraft which accepts the premise that the best government is the least government. That the good of the Common Man in America is always best sustained by the unfettered unrestricted skill Ingenuity creativity and work ethic of the uncommon, man. Honor A system that supports economic growth theories rather than economic constraints theories that recognizes that the Ingenuity of free men and women in a society that gives that freedom and that independence of action primary concern. This is a society which will create new technologies biochemistry computerization robotic synthetics the whole family of largely American Created Technologies are going to provide unprecedented Economic Opportunity. To Future generations and unprecedented Improvement in the quality of life for all Americans. Now that's the message that must be given by our political leaders to our people. from our University platforms (00:16:24) from our pulposus (00:16:26) and certainly within our family Circle. because that is a recognition of the realities of the great strengths of America that have achieved so much. For Generations who have come to our Shores seeking economic Refuge political refuge and opportunity and any candidate for public office who recoils from the refurbishing and the strengthening of this Renaissance of the American (00:16:57) Spirit. (00:16:59) Must be a candidate viewed (00:17:02) with great (00:17:03) reservation. I must tell you as a republican that I was shocked the other day. I live in. McLean Virginia along the fence of the CIA and three weeks ago I Rose one morning with the helicopter hovering outside my bedroom window. I thought what in Heaven's name is if I want to Afton walked up to the street the access road to the Central Intelligence Agency and there once again in America. Or hundreds of bearded unwashed dissidents laying in the street being dragged into paddy wagons demonstrating their opposition (00:17:43) to our Central (00:17:44) Intelligence Agency, and I said to myself. Oh god, (00:17:48) let's not let that happen again in America. (00:17:52) Now these are the stakes we face as a as a nation. We are going to continue to keep this Renaissance alive only to the degree that this Administration and its successor begins to deal more effectively with a host of Unsolved challenges here at home and abroad. We have today the pervasive problem of drugs in our society 40 billions of dollars of federal state and local funds are now focused to educate to rehabilitate and to secure our borders from these illicit Goods. Let me tell you the time has come to divert some of those resources to deal with this problem at its source. Those Nations who willingly or unwillingly have been permitting the production in unprecedented volumes of illicit Goods, which are transferred to our Shores. Now most of that is taking place in Latin America today and Peru Bolivia Colombia. And most of those nations are too weak. To deal with the production and the culture that exists within their own borders and it's time. We got to helping them stamp out that problem at its source. That's what we did in the 70s and we achieve great success it drove that production from the Territory of our friends in turkey and the Golden Triangle of Southeast Asia where it's now once again, rebuilding because we took the problem to the source and that's where you have to deal with it. There's the problem of declining quality of American Education. now in a state where your pay scales for (00:19:33) teachers have kept (00:19:36) generally abreast this may not hit the same decibel. It would elsewhere in America. But we have traditionally measured the quality of American education on the volumes of federal money pumped into our institutions of Higher (00:19:52) Learning (00:19:54) and yet we know that 16 percent of the students now entering college and university level are functionally illiterate and our failures have been into grade and high schools in America and our failures to appropriately teach the basics of Education Reading Writing arithmetic and the analytical written and oral skills associated with it. The time has long (00:20:19) since come. To begin to focus on this American Tragedy (00:20:24) by beginning to certify to measure our grade in high school teachers and to reward them appropriately for their accomplishments. Just like we do others in a free market economy. There's the problems of American law and order the problems of American rust-bucket Industries declining competitiveness abroad the problem of American agriculture. And the problem of a declining American Energy (00:20:53) industry (00:20:54) and a specter of once again being vulnerable to OPEC blackmail. And how quickly we have forgotten the traumas of the 70s. But the most important single domestic challenge facing America today is a Mindless national debt, which has doubled from 1 trillion dollars in 1982 the to trillions of dollars that we are carrying today. And what are the solutions coming from? The political left in (00:21:23) America. Mr. Gekko par and his Amendment (00:21:29) which would close our borders to trade and commerce from those with whom we share values around the world and on Whose monetary resources. We today fundamentally depend as we seek to service this mounting debt, wasn't it ludicrous to see prime minister nakasone arrived in our Shores in the wake of a Get part amendment when it was our administration's objective to get him to buy 30 billions of dollars of American treasury notes to help us service our debt. And what we have happened to us as a nation with this debt, and it's servicing obligations is that we have relinquished our ability to lead in macro economic Affairs abroad because we become totally dependent on foreign Capital to service our debt. And the time to get a balance between monetary and fiscal policy in America has long since passed it's not going to be legislated. Through gramm-rudman legislations, which seek to legislate economic morality. It'll only be achieved by a partnership of responsibility between the executive and the legislative branch. how important it is to remember that we Americans are not living in an isolated economic cocoon here in America that passed with the days of Bretton Woods and Every international events subsequent thereto and it's time for America to begin to lead to use economic Summits to accomplish the solution to economic problems rather than to have just political camera opportunities and political acts grinding which we've been doing for the last five years. I know I was in on the founding of the first economic (00:23:21) Summit now, there's (00:23:23) much to be done here. These are the challenges of the future in the area of international Affairs is of course only one fundamental and unavoidable need and that's to create through astute statecraft. a code of international conduct which will at long last find the Soviet Union the other nuclear superpower accepting increasingly rule of law and peaceful change and the rejection of Bloodshed terrorism and so-called Wars of Liberation that will only be achieved by what the Russians themselves call the correlation of forces. That correlation of forces is a contemporary measurement of the total political economic moral spiritual ideological and security assets available to both sides of the given point in history. Let me tell you when it favors the West. The Soviets listen because they are as driven by self-interest as they are by ideologies. And so the real task for this nation and those who share our values around the world and the period (00:24:36) ahead. Is the achievement (00:24:40) and the continuing achievement of a correlation of forces favorable to the west and believe me that will never happen. If we as a nation abandon the Renaissance of the American (00:24:52) Spirit, which I just spoke to (00:24:55) because it is this Renaissance which will enable us through a free Kana me a market economy to American creativity and American leadership to be economically viable. politically sound ideologically and (00:25:13) spiritually whole (00:25:15) and capable in security terms. I'm very optimistic that we can do that (00:25:22) if we do not stray (00:25:23) from the course. I thank you very much and welcome your question. (00:25:40) We will have a question-and-answer session and I'm going to turn the meeting now over to Jean King who was right there and she will conduct the question answer session. (00:25:49) I believe we have a question right here. (00:25:51) Would you care to stand and then you can read it yourself? Just wait till I get the mic you better (00:25:56) what did what is your view of our role vis-à-vis Kuwait vis-à-vis Kuwait. Well, I have a long track record here in March of 1982 as Secretary of State. I sent a memorandum to President Reagan. Which involved a comprehensive approach to the Middle East involved the peace process between Israel and the Arab world, but it involved in primary content the launching of an international effort by the United States of America under the auspices of the United Nations or outside that framework. To begin to bring those oil dependent States those consumer states of OPEC products. Into a collective effort to bring that mindless conflict to a conclusion. Let me tell you we do not as a nation have the luxury of abrogating our International Leadership role. (00:26:55) We Remain (00:26:57) the most effective powerful economic political and security entity in the Free World. Now five years later and we failed incidentally, I gave a speech in Chicago and may of 82 and which that proposal was made. I don't think it ever got to the president's desk blocked by under Lanes in the White House. Here we are five years later. This paper also said that the United States must not take sides in this conflict between Iraq and Iran that here is a war in which we want no winners because both regimes are repulsive. And what have we done over the past five years first, we tilt it towards Iraq. Then we tilted towards Iran under the hostage brouhaha. And now we find ourselves about to launch into a de facto military alliance with Iraq because you know as our forces operate in that golf. There's going to have to be an intimate exchange of highly sensitive intelligence operational data between the United States forces and the Iraqi government. And now we are telling the American people that we have to do this because if it's vital to American interests as well as to the interest of our lives, but we are also reassuring the American people that we are not going to go to (00:28:22) war. The (00:28:25) bottom line of those two contradictory assertions is that we are setting ourselves up again for another humiliation and back down in the Persian Gulf. We know that Iran is not intimidated by American power my Heavens. It wasn't even intimidated by Soviet power. When fundamentalists Fanatics attack the Soviet surface ship several weeks ago before our frigate was attacked and that should have told him something. And when one of their cargo vessels was mined by Iranian forces and where their spokesmen are today, making more and more threatening noises and where it will become a test of manhood. So either if it is a matter of vital interest, then we should be telling the American people and the President should be saying we have a right and an obligation to keep those international waters open and that any government that attacks our forces is going to receive substantial and immediate retribution if we're not prepared to do that, and I'm not so sure we should be Then best we look for some other multinational solution (00:29:35) to solve this problem. I'm very nervous about it. I hope I've answered your question. Yes in this (00:29:44) morning's paper. There was an article on gal Tech corporation, which this past weeks received the president's award for exporting to Europe and Japan. I happen to know some of those people and I think they have a very strong (00:30:00) work. Ethic. Do you (00:30:02) believe that that is a problem (00:30:03) in this country now our work (00:30:06) ethic? Well, yes, of course it is. Although we've had some very very Troublesome and it's sobering experience has in recent years and that involves not only Management in America, but it involves labor in America. If you'll look over the last five years since we've been experiencing this steady decline in our balance of trade are lost niches and international markets. I think American labor has toned down his demands very very substantially. It should have only and in any event in macroeconomic terms because the inflation they had to deal with of 1980 of 13% is now almost flat. So cost of living increases have have not increased in such a way that we should be having a massive surgeon in spend are in salaries. I do worry about the tendency of American corporation to seek to close these borders to foreign competition and a minute they do to jack up their prices and their emoluments and salaries and believe me that is that escalating latter of irresponsibility that got us into this mess in the first place. So is it true that we've lost our work ethic? I don't think so. I think American workers are the most creative the most disciplined the most competitive and energetic in the world, but they must live in an environment in which the product of those efforts are rewarded either by a stake in the outcome or by sufficient wages to keep them competitive. I'm never believe that a high-paid American Workforce is ipso facto and inefficient American Workforce if that high pay is the product of incentives for greater productivity and greater achievement. It's an incentive. For the work ethic and that's what we have to structure here in America. I hope I've answered your question. (00:32:12) General (00:32:13) I had the privilege of being in France and Europe at the time that Reagan was first running and I want you to know they were didn't know much about Reagan, but they had a great respect for the what you did in NATO and a good following and help the administration. My question is we had the big Riots of the people in Germany to put the missiles in and now after ice and they're afraid they're going to take him out. Would you take a stand on (00:32:40) that? (00:32:42) Yes, and I don't want any misunderstanding. I'm an advocate for arms control a strong Advocate I participated in salt and 1 and the conclusion of the ABM Treaty both of which were premised on certain assumptions that the Soviet Union would follow in spirit and letter Reduction in the Mindless growth of the ballistic heavy weapons that are comprised of the SS 18s and 19's 24 and 25 which now enjoy a321 superiority over the United States in ground-based ballistic capability. So I want you to be sure to understand that the zero option was conceived in 1981. When I was Secretary of State by the defense department. It was then sold to the president as a vehicle for winning the propaganda war with the Soviet Union that time there was great controversy over whether or not we could modernize our theater systems with cruise and Pershing to At that time the defense department told the president that the Russians could never accept this proposal this zero option which then involved only the SS 20s in our (00:33:56) Persians and crude. (00:33:59) They also said that the Europeans would not have the gumption and the manhood to go ahead with the deployment of the Pershing twos and (00:34:08) cruises. (00:34:11) I said wrong my friends on both counts. The Europeans will have the courage to go ahead with those deployments and they did. I also said wrong about the Russian they will just when you least expect it except that zero (00:34:28) option. Why (00:34:30) because it begins a giant step towards what they have. Always sought in Western Europe first the creation of undeath uncertainties and and fissures between Western European nations and the United States and that's a giant step in that direction. It decouples (00:34:49) our deterrent (00:34:50) and secondly because the Europeans have always faced Soviet Support for a nuclear-free Zone in Central Europe. That was The Proposal of the Polish foreign minister in the late 50s and mr. Up hockey has been followed in cycles of for eight years by one neutral advocate of Soviet policies after the other the latest was Olaf Palmer and his urging for a central European nuclear-free zone. Why because the consequences of the denuclearization of Central Europe is to give the Soviet conventional superiority a dominating position through which they can continue to intimidate blackmail and continue on with the Fisher's between Europe and the United States. So I think it was a mistake. I thought it was a mistaken 81 is now a double zero option as put even a greater burden on our West German friends because we are taking out onto the second zero option the shorter Range Systems and leaving only Battlefield systems. And these Battlefield systems can be fired Only on West German East German or Czechoslovakian territory. And I tell you that would make a nation rather paranoiac and that's why Chancellor Kohl is wrestling with his very difficult dilemma, which American policy is put them in now, it doesn't mean we have to junk it. It means we have to put some additional conditions with respect to start talks verification and perhaps some progress in conventional reductions as a precondition for accepting this double zero option. I hope I've answered your question. We have a question here. (00:36:33) Yes regarding education. Would you favor a voucher system which lets parents select the educational institution and if not what other (00:36:41) method know? I'm an advocate of a voucher system or some other comparable Freedom of Choice mechanism in which the parent and the family unit can individually make its decision with comparable Federal support for the education. They choose for their children. (00:37:11) Would you please comment on your views of the National Health Care policy and Medicare (00:37:18) Medicare and health? Well, I I've looked very much at former Governor Bowens. New catastrophic health plan, which I think has very important and essential ingredient. We cannot ask America's elderly who earned a quality retirement to squander all of their life savings if they presents them with complex and costly Medical Care. I'm a great believer. However, in bringing the private sector into this important aspect of our social compact to a greater degree than heretofore because it's been our experience and case after case that the private sector spurred by competition can give better quality a cheaper cost to the American people is a very complex subject. Of course. But I think in general that. Given the Alternatives that the Bowen plan perhaps with some modifications is not only desirable but doable and should be supported. Is that the answer that you're seeking (00:38:32) yet? (00:38:38) What role do you see for for our government in economic development in what are called third world countries? Well, I'm glad you asked that. You don't. A great verifier on the strength of the private sector in America and his creativity is the recent courageous action taken by. Mr. Reed of the Citibank. I mean to tell you he stuck his neck out to do something that our Secretary of the Treasury should have had the courage and Leadership to do long before now. And that is to recognize that this third world debt in his contemporary content is never going to be repaid and for us to pretend that it's going to be is the height of sophistry. And so what did mr. Reed do in effect he cautioned. Their shareholders with some reserves for inevitable defaults. One of the banking what are the central bank's doing today with this uncollectible debt? I'll tell you what the government's been doing. The government has been putting forth proposals which increase that debt but relieve the servicing obligations and that's an endless destructive cycle for every developing state that is victimized by and we've seen it recently in Brazil where some of their own shortsightedness combined with ours to create a major crisis where they have now defaulted on all of their loans at least for the moment. Now what is the reality of this issue? I'm going to give a speech in San Francisco on Monday. And which I'm going to lay out a five-point economic get well program for America, which is going to bring in all of the aspects of the American economy our trade and monetary problems our fiscal and monetary problems here at home are restructuring problems in the context of American industry. I have lack of leadership and economic Summits. We got another one coming to Vienna and it's already dead before it happened. And this third world debt and the essence of that third world debt will be a restructuring effort which is going to happen whether the government supports it or it doesn't it's already brought Chase into the mix with Citibank. It involves two things first that most of these deaths have already been given the secondary markets where they are at for sale at about 60 cents on the (00:41:14) dollar. (00:41:17) Secondly, most of our central banks who have to answer to stockholders and and we as a nation cannot support an irresponsible solution for the third world, which means you incur debt and you don't repay. So the second aspect of this is a swamp of debt for equity. With the indebted nation and those Nations have to understand that they can no longer centrally manage and control all of the National Asset if they want to get well economically, so there's a very obvious solution which were being driven to without government support or Acumen and which would be far better done. If it were done internationally, you know, one of the great and important cash flow problems of the developing world of days already been met at least by the vision of mr. Nakasone who's offered a thirty billion dollar additional step into the developing world. If the United States were leading economically, we would urge other Western industrialized States to join us and Japan in providing such a pool of assets and we've long since learned that the IMF cannot run that business because it's a nitty-gritty dollar and cents a conditionality prone. Agency that imposes such austerity on the indebted Nations that we bring down governments that really want to help solve the problem and replace them with nationalist governments that will refuse to so we ought to put this thing in the world Bank in my view and that's also going to be in my speech. I hope I've answered your question without giving too much of my speech away. (00:42:59) General Haig could you analyze for us the sources of the one trillion dollar increase in the national debt since 1980. Why sure the sorcerer's of it? (00:43:10) Well, you know, I've sometimes rather chagrined that I sat there at the cabinet table with such gurus as David Stockman. Who never made a whimper and who five years later for big bucks on Wall Street told the president what he did wrong. And I can tell you what he did wrong because I used to go back to the state department every afternoon after these cabinet mises say my God, we're going to create the largest deficit in the history of this nation. Now there are two major macro contributors to it. The first is what I call the failure of the administration to understand the emerging interdependence of the United States rather than its independence. Since the days of Bretton Woods, we became intimately involved that meant everything we did here at home in National economics had to be viewed in the context of its impact abroad and everything had happened abroad had to be viewed in its context of its impact here II Miss judgment is what I call etiological religiosity. I didn't want you to leave without a little Hank speak. Now any logical religiosity is a term used to describe a tendency of our friends from, (00:44:28) California. (00:44:30) To latch onto simplistic schools of economic theory supply side and the Laffer Curve which are not without their virtues, but which they somehow convinced themselves that simply by deregulating our economy and returning taxes to the taxpayers oranges would be revved up to the point that the resulting revenues would meet all our social obligations here at home. But strangely while the executive branch is implementing this school of economic theory a growth School. (00:45:02) Mr. (00:45:02) Paul volcker the chairman of the FED who was terrified at 13 percent inflation began launching classic monetarism in a constraint mode Tight money and high interest to squeeze inflation out of the economy. Now the Practical consequence of a growth theory in a constraint Theory operating simultaneously is like putting your car in Full Speed Ahead and reverse at the same time. And so the hope for both schools of theory were dampened by the contradictions imposed by the other. And the real problem was that both of these schools of thought impose major hits on federal revenues if I give you back taxes, I deregulate the economy measure hits on federal revenues. If I bring inflation down, every percentage drop in inflation is a cost of billions of dollars of tax revenue in the year involved. Now that's why our Democratic friends like to keep a healthy degree of inflation. It means higher tax revenues so which they can support and fuel more Federal programs more spending now, there's a third contributor and that's a contributor that I call Modern populism. I think I've said before that the president's I've known who has succeeded best, and I've served seven not three. I started with Jack Kennedy at very close range. is Their tendency not to be able to discriminate between the kind of guy. You need to get you elected the Image Maker. And the kind of guy you need around you once you've been elected to help you govern and believe me. There are different breeds of cat and that's not critical of either. But the president's I'm known who have succeeded most were Jack Kennedy in a very brief period Dwight Eisenhower and I'll say Richard Nixon and his first term because these men reached out into our society to Academia to business (00:47:14) to experience (00:47:16) and gave them the heavy responsibilities. They were asking them to bear. This Administration didn't do that. And therefore Image Makers had high substantive Authority in the Reagan Administration. And that meant that every time the president was taking faced with a courageous act which in Edmund Burke's. Description of democracy means that you act by the dictates of your conscience and the long-term good of the American people rather than being Whiplash by the whims of contemporary mood. President should have vetoed Bill after Bill in 1981 and 82 when the Congress sent up those budget-busting provisos instead. He recoiled for fear. It would cost him popularity. He didn't do it with his Highway Bill a couple of weeks ago, but I'm afraid it was a little late. when I worked for president Jerry Ford He vetoed 65 bills in his first six months in office. Ronald Reagan has vetoed under 40 bills and over five years as chief executive. Now the other problem In fairness to the president is that the Congress has gotten very shrewd. They've learned how not to send up individual pork butt to lace it very intricately into the major bills needed to keep this government functioning. And I would have wished the president had spent as much time on getting a line item veto for the executive branch of this government last year as he spent on this tax reform bill, which was not an egalitarian move but a 30 billion dollar tax hit on American industry (00:49:00) and corporate interests (00:49:03) and with the removal of the investment tax credit. I think a major depressive on the economy at a time when we didn't need it with all of the faults of the old tax bill and it had many I hope I've answered your question. That's how we got that (00:49:18) deficit (00:49:20) and it wasn't defense spending as bad as that (00:49:23) was. I am from Nicaragua and I would like to know what will you do? What will you do in relation to the problem that Central America is facing today? (00:49:36) Well, I don't want you to take offense. (00:49:41) What (00:49:42) I was vehemently opposed to the covert program in Nicaragua. I said to the president, please do not do this and I'll tell you why and there are a host of inter lapping reasons some relatively frivolous and some rather significant the frivolous first. I said first mr. President a cop-out for you. You want to go to bed every night and tell yourself. You've done something tough against those Marxist sandinistas, but you still demand the right to wake up every morning and still be loved by the American people because you haven't theoretically disturb their tranquility. (00:50:22) Cop out. (00:50:23) Let me tell you where lives are involved and where the vital interest of the United States and this hemisphere involved. I think the American people want to be in on the take-off as well as the landing. Secondly, and I said this in a very frivolous way I said, mr. President covert is a contradiction in terms in your (00:50:46) White House. (00:50:49) I never got back to the state department before one of the so-called triumvirate hadn't leaked everything to the Press with a self-serving twist. Now that's bad. It's begun to stop because most of the triumvirate is gone, but that was their style of government. Now the real reasons, you know, it was a flirtation with a repetition of the misjudgments of Vietnam because a covert program by its very nature. Brings with it a built-in incentive for the other side to immediately repair the damage and a face you with escalating levels of violence, which we Americans are not very good at coping with especially our legislature. That's exactly what happened when the contras began to achieve some success in came the mi-24 helicopters from the Soviet Union through Cuba devastated the contras drove them back into sanctuary in neighboring states where too many of them remain hunkered down today waiting for the next hundred (00:51:52) million. (00:51:54) And finally, let me tell you this in this is the important aspect. America should be an advocate of rule of (00:52:00) law. rule of law (00:52:06) When we start proclaiming the right? to determine what kinds of regimes are Central American neighbors are entitled to have Are we not adopting a Brezhnev Doctrine of our own for this hemisphere? Do we not / create contradictions that make it in a society such as America increasingly difficult to justify and understand just what it is. We are about in Central America. You know, I'm going to make an outrageous statement. I don't think we Americans would give a damn. if Nicaragua where Marxist and I chose it freely by the choice of the Nicaraguan people and we wouldn't have a right for a point of view. Facts are I say that very comfortably because I think the Nicaraguan people would throw the Marxist out tomorrow if it were not for the Cuban Soviet East European and Asian Marxist domination of that tortured country and people now what gives Central America its strategic Dimension Marxism in Nicaragua, not at all. Violation of international law by the Soviet Union and Cuba and intervention by those countries into the internal affairs of our Central American neighbors and by God, we have a right and an obligation to insist they butt out. But that means we have a corresponding obligation to but out ourselves. Now some of you won't like the next step. Because if we are Advocates of rule of law. doesn't that mean that we have an obligation as well as a right to use all of the assets available to this nation political moral economic and if need be security to reinforce rule of law in this Hemisphere and that meant getting a lot tougher on mr. Cooper. Mr. Castro, you know, I never had a meeting with gromyko that I didn't raise this issue and finally in February of 82 and Geneva. He said to me hang all they ever hear from you is Cuba Cuba Cuba. He said from now on Cuba is your (00:54:28) problem. (00:54:32) Not insignificant. I went to the president. I said my goodness. We have it. They've cut Castro loose on this issue now is the time to get tough with Cuba. No, Cuban leader would contemplate for 30 seconds a military Showdown with the United States when they preside over a little island 11 million people no bigger than greater Los Angeles County a hundred miles from our shore. (00:55:03) The (00:55:03) problem is we haven't maintained credible consistent persistent advocacy of rule of law. And that must be the centerpiece of American foreign policy as we approach the turn of the century. I hope I've answered your question. (00:55:22) Mr. Haig considering the letter and spirit of the Boland Amendment and the efforts of the Reagan Administration to circumvent it. Do you feel that the power of the executive branch of government is being undermined or weakened by the request of Congress to become more informed and involved in these decisions and actions. Yes or no? (00:55:53) You know, it's important to remember that this struggle between the legislature and the executive has been a historic ones who have to history of our Republic and it is much as anything has been a victim of the great dialectic we've lurched from, you know, a vicar ship to use that dirty word in A legislature back to a vicar ship in the executive branch dependent on a number of unpredictable things the most recent experience the most recent Miss management or or just the mechanistic dialectic in which we America seemed to Lurch from one set of attitudes to another and cycles of four or eight years now. The decade of the 70s was a very Troublesome one in that regard with the all of the ambiguities and contradictions associated with Vietnam double decked by Watergate and we had a very strong surge of influence into the legislature now incidentally, I have to believe it will work either way and we need not be too traumatized by that reality. I prefer it to be more in line with what our founding fathers recommended in the Constitution. And that is that the executive chief executive has responsibility for the conduct of foreign policy. The Congress has the obligation to provide the means to conduct that policy and to ratify agreements and treaties Associated there with now having said that when mr. Reagan came in he came in on such a wave of reaction to the difficulties and failures of the 70s that he thought a seized freedom of action and like so many presents. Unfortunately. He's perceived as some areas to include irangate have abused it. So we're now seeing the painting. I'm going back the other way and every congressman and Senators on the tube every day telling the president how to suck eggs in the Persian Gulf and they're entitled to do that. I don't want that to sound too frivolous. It's been my experience that the Congress has several flaws in its functioning when it comes to foreign policy one is it tends to legislate permanent solutions to Temporary (00:58:14) problems, (00:58:16) and that's a very severe handicap on what I call American reliability consistency and predictability in the context of foreign policy. Secondly, it has become Sawed of less so in recent months and I hope far less. So in the future a one-man one-vote organization. What we used to do in the early days when I served with President Johnson and and Kennedy and even the early days of Richard Nixon and Lyndon Johnson, we could bring in the leaders of the committee's on a vexing issue like the Persian Gulf and sit them down at the table and hammer out a consensus, which is really the real essence of the presidency and his relationship with the (00:59:06) Congress. (00:59:08) Today is one man. One vote. You poor guy makes a commitment for his committee goes back and Joe Blow from Your Boykin is out there making his own Farm policy and the more outrageously undisciplined. He is the more attention he gets from the media. So we've got to have greater discipline. We've got to recognize you can't legislate foreign policy morality any more than you can legislate economic morality or Morality In general. Human Ingenuity is too vast. That's what happened with the Boland Amendment human Ingenuity got to circumvent it. That's what happened. The gramm-rudman. No sooner. Did they sign the bill and they broke every single fiscal guideline in that bill. Human Ingenuity, the answer is a partnership of responsibility continuous respected communication the strengthening of the leadership on the hill. So the committee chairman aren't charged once again of their committees. I think a reduction in the 20-some Thousand staff people on that Hill which tend to dominate the judgment and the obligations to know the problem of many of our legislators. I've seen go into committees and in comes the note and the guy looks at me reading it. What does he say? Oh, then he asked the note what the note told him and I some staff Sharpie. Dangerous, so we have faults on both sides, but the one answer is partnership of responsibility. Hope I've answered your now I've gone very long and I know many of you have livings to me and I want to conclude whether or not observation because somebody told me when I came in here, I had a reputation of being an anti-russian. And I would be very upset if I left the you had that illusion. So I want to tell you a little vignette. In 1970 as date aunt was being born. And the first visit from mr. Brezhnev to Washington for the first summit with Nixon was approaching we got a letter actually a wire from Moscow. Mr. Brezhnev requested permission to bring the head of the Soviet Secret Service in his traveling party. Now that wasn't the KGB which on drop-off was running at the time, but this was the Sinister arm of Soviet intelligence the old dog poo that does all the Dirty Work the British had a similar request. They said we won't have that hideous fellow in the British Isles. But we were welcoming they toss and we said bring them right along. I went out to Andrews Air Force Base with hair. Dr. Kissinger off. The Russian plane came. Mr. Brezhnev The Smiling lovable affable. Mr. Gromyko. Then the most Sinister looking guy you ever (01:02:05) saw (01:02:07) sure enough. It was our hero and he was the personification of his responsibilities under his arm. He had a black leather valise that was clearly empty. It was flat as a dime. I said oh (01:02:23) this guy's here to (01:02:24) steal every paper. The president has we were going to Camp David where it's very informal. I got the head of White House Secret Service in I said Buster I said you're to get up before he does. You don't take one eye off that man through the entire day after he goes to bed you report to me personally exactly what he stole every night. This bloodshot. I'd character would come into my Hooch at Camp David. It's a general I got up before he did. He went to the Village. He went shopping. He took us on a bath. He went to the meeting. He did steal any papers every day that bag got fatter by the last day of the visit. We were in San Clemente. And we had to take the party to El Toro Air Base to send them home and I can tell you that bag was so full. You could see it throbbing as fate would have it our hero started up the Gangplank of the Russian plane. He accidentally bang the bag on the railing it burst open all of its contents on the runway boy. I knew we had him. I ran over six Secret Service guys reaching for their heaters, you know what it was crayons and coloring books for his (01:03:43) children. (01:03:45) That night the chief of Secret Service came to me. He said Hague you are a phonetic is that I've never spent such a week in my life. I said, yeah, if you cut open those crayons you two found him fill with microfilm now get back to (01:04:02) work General Alexander Haig former Secretary of State speaking at Minnesota meeting today the formal topic of his address before we got to the question and answer session challenges for the future American foreign and domestic policy lie broadcasts of the Minnesota meeting are made possible by the Twin Cities based law firm of Oppenheimer wolf and Donnelly in recognition of its 100th anniversary. On behalf of Minnesota meeting. I'd like to present to you the Minnesota peace pipe. I got the message. This was created by a Minnesota artist by the name of Robert Rose bear. And as you know, the peace pipe is a symbol of the human bonds. We must maintain in order to maintain. Peace. Thank you again. (01:05:06) All right, let me leave with one observation. Don't be vague vote for hey, shake a leg for Hague. Don't bother with Dolan Dolan. It's only pineapple juice Hagen eggs The Real McCoy. (01:05:34) Thank you for coming the next Minnesota meeting is on June 9th. It will feature Robert Malott chairman of FMC corporation whose speech is entitled. Today's trade agenda chasing markets are chasing votes. Thank you very much.