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The Conservative Caucus,Inc. National Headquartars ^50 Maple Avenue East, Vienna, 22180 (703) 393-15:

HOWARD PHILLIPS' REMARKS AT THE HAYDEN-FONDA PRESS CONFERENCE, SANTA MONICA, , iVlAY 24, 1982.

Good morning. My name is Howard Phillips. I am National Director of The Conservative Caucus, which is a non-partisan, grass roots lobbying organization, with roughly 400,000 supporters throughout the United States. We have been involved over the years in a number of issues. For example, in 1977 and 1978, we helped organize the nationwide campaign against ratification of the Carter-Torrijos Surrender Treaty. In 1979 and 1980 we led the nationwide, fifty state campaign against ratification of Salt II.

Currently, we are focusing considerable emphasis on a campaign which we call "Defunding the Left." We agree with Thomas Jefferson that it is sinful and tyrannical to compel a man to furnish funds for the propagation of ideas which he disbelieves and abhors. We believe that the principle incorporated in the First Amendment which says that Congress shall make no law respecting an establishment of religion and which has been interpreted to mean that religious faiths ought not be subsidized, carries with it the implicit understanding that political faiths, likewise, ought not be subsidized.

But, the fact of the matter is that, since the early 1960s, when many programs of the Great Society were instituted, literally billions of dollars in Federal funds have been used to underwrite the activities of organizations which have political axes to grind. In his State of the Union message earlier this year. President Reagan pointed out that, whereas in 1960 some $7 billion from the Federal treasury went to subsidize categorical grant programs, that number was in the neighborhood of $100 billion by the time he took office. In 1960 you had something under 200 different types of categorical grant programs, but today you have more than 500 such programs.

We are here in Santa Monica today because some of the groups which have, over the years, received funding from the Federal treasury, at taxpayer expense, and which fall into this category of political activism, are groups which have been allied with Tom Hayden and Jane Fonda: groups like the Laurel Springs Institute, groups like the Citizen/Labor Energy Coalition and a number of others.

Board of Directors Executive Director Director of Research Publications Howard Philhos Cdair.-ran F .Andy fdessirg. Jr and Publications Senate Issues Yearaook Peter J. Thomas, Secretary 3uS3" E, Prri ijtps Senaie Reoon Lawrence J. Straw. Jr. Treasurer Administrative Vice Chairman 3rass Roots Richard Derham Charles Orndor'f National Security Task Force Member s Reocrt J A.an ivtacKay 3rig Sen A'bion Knight. JSA Re' Ar.njat Reoort Field Coordinator Co'iser.'dtr.'e Manifesto National Director Monroe Thomas HO'/rard Philips Page 2

We believe that it is wrong for groups of this kind, whether or not they are associated with Tom Hayden and Jane Fonda, to receive funding. We think it is wrong for politically active groups, whether they are liberal or conservative, to receive political funding. We object to the fact, for example, that the Department of Education, in 1981, extended an additional several hundred thousand dollars worth of funding to the Rev. Jesse Jackson through Operation PUSH-EXCEL. We would be just as critical if it were the case, which it is not, that Federal funds were going to underwrite the Rev. Jerry Falwell or his .

At a time when President Reagan has proposed the largest budget deficits in the history of our republic, deficits which, in the opinion of Rudolph Penner of the American Enterprise Institute could, over the next four years, reach some $875 billion, it is important to rally the American people in support of cuts in non-defense spending so that they do not reach the flawed conclusion that the only way to balance the budget is by raising taxes.

President Reagan will be in tomorrow evening, as you know, and I hope that he will, while he is here, perhaps from your accounts, perhaps from the accounts of other Californians upset about the ways in which Federal funds have been used, determine to make a change in the policy of his Administration.

Just this past Friday I met briefly with David Stockman, the Director of the Office of Management and Budget, to express my concern about a memorandum which David Stockman issued for heads of Federal departments and agencies on April 26, 1982. A copy of that memorandum is attached to the press release which is in the press kit.

If you read the fine print in that memorandum, while it includes some language which we support, the bottom line is, "political advocacy groups may continue to receive grant and contract awards." We think this is an outrage. We think that President Reagan should personally intervene to do something about it and we think that there are some specific steps which any Administration ought to be called upon to take by the American public to deal with this problem. The first very simple step is for the President to require each department head and cabinet secretary to name a key person in each department and agency who has final responsibility for sign-off on discretionery grants and contracts. Second, a training program should be instituted so that people in the Reagan Administration are able to deal with the procedures and regulations that have been developed and locked-in over a period, in some cases, of 18 or 20 years. We Page 3

believe it is important for tbe communications officials of each department and agency to bring to public attention the facts about how this money is being used.

We think the President should encourage men like Senator Orrin Hatch, the Chairman of the Labor and Human Resources Committee in the U.S. Senate, and Senator William Roth of Delaware, the Chairman of the Government Operations Committee, to hold oversight hearings, calling attention to the inappropriate uses of public funds.

We think that the Freedom of Information Act should be extended so that non-profit organizations which receive Federal grants and/or contracts are subject to the provisions of the Freedom of Information Act, which in many cases, is not now the case. We think that, wherever possible. Federal dollars, so long as categorical programs of this kind remain, should be issued by contract rather than by grant. We think there should be standardized government grant and contract procedures government-wide and we think there should be cross-referencing, so that people in the Department of Health and Human Services, for example, will know when a particular grant recipient is also applying for money from the Department of Education or the Department of Housing and Urban Development.

We think as a matter of course, members of Congress should be given detailed information about the grants and contracts going into their Congressional Districts. We want to avoid the kind of situation which has occurred in the past where grants going to one organization have been laundered through to other organizations. One example of this is the Youth Project, which during the reign of Miss Marge Tabankin at the ACTION agency, received funds, some of which were delegated to the Institute for Policy Studies.

So, that is basically our message this morning. While we have a concern for and a strong disagreement with the many organizations that receive Federal funds, we also have a disagreement with the Reagan Administration which has failed to take the actions available to it to correct the situation, which is an outrage and a national disgrace.

I'd be pleased to answer your questions.

QUESTION;

Would you please tell me what your group thinks should be subsidized, outside of defense spending - military spending?

HOWARD PHILLIPS:

Well, you can make a case for subsidizing a whole variety of Page 4 things. I think it is easier to narrow the issue by saying that there is a distinction to be drawn, as the Supreme Court has done, with respect to aid to parochial schools in the area of education, between funding hardware on the one hand and, on the other hand, funding the propagation of ideas. There is something very wrong when you cannot control political decision making in a free society, either through the market place of ideas or at the ballot box. When members of Congress delegate policy setting functions to people in the judiciary and the bureaucracy, they are denying the rights of citizens who expect to be able to hold those members of Congress accountable for their votes.

QUESTION;

Could you give me examples of what your group would be in favor of subsidizing, outside of military spending?

HOWARD PHILLIPS:

Well, for example, we believe that the Federal government does have a responsibility, as set forth in the Constitution, to provide for the common defense, promote domestic tranquility, provide for the general welfare, etc. By and large, the purpose of the Federal government is limited to those functions specifically assigned to it, with the rest remaining to the states. We think welfare is not a proper Federal function. We think that defense is. We think that in some cases, in terms of Federal enclaves, there are certain types of construction expenditures which would be appropriate. But, by and large, we would say that the burden of proof would be on the Federal government to argue that an area of expenditure is appropriate, rather than on the citizenry to argue that it is not.

QUESTION:

Do you feel that all the groups listed in this magazine, the 30 liberal groups, and those others that do probably receive Federal funding are inappropriate for such?

HOWARD PHILLIPS;

Indeed, we do, because they have a politically activist character. For example, one of the organizations which has received considerable funding during the Reagan Administration is the National Organization for Women Legal Defense Fund. During the Carter Administration NOW-LDF received something like $160,000. During the Reagan Administration, their funding was complimented by an additional $435,000 in new obligational authority. Now, the National Organization for Women has a perfect right to advance its views about the role of women in society, but they do not have a right to require taxpayers to Page 5 subsidize fheir particular viewpoint any more than has a right to require taxpapers to subsidize the activities of her organization.

QUESTION;

Mr. Phillips, we have a list here of 175 groups that you describe as Left-wing and have gotten Federal tax dollars, at least once in the last five years. On this list are the American Bar Association, the Audubon Society, and the League of Women Voters, among others. Now, what is your real target here? Are you complaining about what the Reagan Administration is doing to continue what you think is the wrong policy? Is your target Tom Hayden? What's the connection? We haven't heard yet how Tom Hayden benefits from these 175 plus organizations that get Federal money.

HOWARD PHILLIPS:

Well, I would be happy to spell that out in some detail. Let me first of all say that, while we endorse what is in the Conservative Digest, it is published by a separate organization, Viguerie Communications. Our organization did do a considerable amount of research for it, but not all of it. That is Point One.

Point Two. With respect to organizations such as the American Bar Association, the League of Women Voters, and the Audubon Society, those are organizations which do have political axes to grind. They are advocating public policy changes. For example, the American Bar Association has taken a very strong stand in support of forced busing decisions. It has taken stands on a whole variety of issues that are beyond the normal bailiwick of legal professionalism. They have involved themselves in many areas of the political process. Likewise, the League of Women Voters has taken stands on issues ranging from ERA to the Salt II treaties. The Audubon Society has taken a position strongly critical of many of the policies being favored by Interior Secretary Jim Watt.

Over the years, a number of organizations associated with Tom Hayden and Jane Fonda have received Federal funding. We do not pretend to know all the details. We know some of them. For example, the Center for New Corporate Priorities received CETA funding in 1978 of some $126,000. This progrsun at the time was run by Mayor Goldway of Santa Monica, who, of course,was chairman of Mr. Hayden's 1976 Senate campaign.

The Citizen Labor Energy Coalition, an organization on whose board of directors Mr. Hayden is personally represented, has, over the years, received a number of grants. For example, they received a grant on May 29, 1981, most recently. The aggregate Page 6 funding that we have identified for the Citizen Labor Energy Coalition over the last several years, comes to about $287,000.

An organization called the Center for Coiranunity Change, which has worked very closely with a number of the leaders of the Campaign for Economic Democracy, received on December 1, 1981, from the Department of Labor, $275,000.

By the way, that is CLEC funding. Citizen Labor Energy Coalition which was, in one case, from the National Endowment for the Arts, but they have also received money from the Department of Energy, the Community Services Administration, and other groups.

The Department of Justice during the Carter Administration gave Communitas, an Ocean Park, California program with which many of you are familiar, headed by Jim Conn, at the time treasurer of Santa Monicans for Renters' Rights, received $334,761. We have records of more than $200,000 having gone to the Laurel Springs Institute, and there are a variety of other groups.

The reason we focus on the funding of groups which have been associated with Tom Hayden, Jane Fonda, and the Campaign for Economic Democracy is that, very simply, Jane Fonda, by her support of this nation's enemies in the very early 1970s, Tom Hayden, by virtue of his conviction in the Chicago Seven case, achieved a degree of national notoriety which symbolizes the concerns that many Americans have. Santa Monica has, itself, achieved a degree of national notoriety as a result of the political successes of the Campaign for Economic Development here in Santa Monica.

But, to get to the bottom of your question, today, as much as we disagree with Hayden and Fonda, they get A for effort. The fact of the matter is that the funding of organizations of this sort can be cut back, in many cases, by administrative discretion on the part of the Reagan Administration. In other cases, legislation will be required, but, in all cases, leadership is necessary.

The principle point I am making, and it is spelled out in our press release, is that the Reagan Administration has not provided the degree of leadership which the people who voted for it in 1980 have a right to expect on this issue.

QUESTION; In your statement you pointed specifically to the statement by Stockman that political advocacy groups may continue to receive grant and contract awards, but you seem to slough over the part that the categories under which they will grant these funds to those parties who are most effective in fulfilling statutory Page 7 purposes. Well, if they are effective in fulfilling statutory purposes, laws passed by the Congress, then why do you point to that last?

HOWARD PHILLIPS;

Because that is the major loophole. First of all, in some cases we disagree with the statutory purposes and hope the President will provide leadership in seeking to- change them. But the fact of the matter is, that even where the statutory purposes may be sound, the people have a right to have leadership coming from organizations not involved in the political arena.

The Washington Post wrote an editorial on this subject on April 26, 1982, in which they said, referring to this edition of the Conservative Digest, "We agree that there is something disturbing about organizations that strongly advocate positions many sensible people find politically or morally repugnant, acting at the same time as administrators of government programs. It is easy to believe that the advocacy groups employees will sometimes proselytize the programs beneficiaries in ways we would consider inappropriate, though not unheard of, for a civil servant. Advocacy organizations might also want to ask themselves whether they risk compromising their own purposes by accepting government money and whether they want to assume the inevitable risk that it might be withdrawn suddenly for legitimate political reasons."

So, just as I think it would be inappropriate for the government to fund the Republican party or the Democratic party to run a health care center or a halfway house because they have political axes to grind and it inevitably puts them in a service role which gives them political power (it is the kind of service role which big city political machines over the years have used similarly), it is inappropriate for ideological advocacy groups to play that kind of role.

They are not, in all cases, partisan, although the Campaign for Economic Democracy is a notable example of an ideological which has also resorted directly to ballot box activity. There are a number of such advocacy groups which have not, even there. In terras of putting them in a position to lobby for their particular objectives, we think it is inconsistent with the civil liberties guarantees of the First Amendment.

QUESTION;

You're not suggesting that the Campaign for Economic Democracy ? (inaudible)

HOWARD PHILLIPS: Page 8

Not directly, although there is considerable evidence that CETA workers, who were funded in this area during the Carter Administration, devoted considerable amounts of their time to work for the Campaign for Economic Democracy and its objectives.

QUESTION;

Mr. Phillips, what's the significance of the timing of your appearance here today? This is two weeks before an election in which Mr. Hayden is a candidate. Are you attempting to intervene in this election? Do you, does The Conservative Caucus, support some other candidate? Why are we hearing about this today. May 24th?

HOWARD PHILLIPS:

Well, there are various reasons why we are doing it. The principal reason is that in early May, I received a copy of the David Stockman memorandum which was a very lukewarm, weak-kneed response to a series of discussions which I have been having for more than the past year with Ed Meese, Jim Baker, Lyn Nofziger, David Stockman, Ed Harper, on one occasion the President, himself, about the need to do something about the funding of the Left.

After our organization did considerable research for the benefit of the White House and prepared detailed recommendations on what needed to be done, it became evident, as a result of this memorandum and the failure to accompany this memorandum with other actions, that the Administration is not moving in a forthright, expeditious, or high priority manner to deal with the issue. That is one reason.

The second reason was this was the first day I could fit into my schedule, after having received the memorandum, to do it. Then, we also learned that tomorrow. President Reagan would be in California and since the President is very often carefully surrounded in Washington, D.C., we thought it might be easier to get his attention here.

One interesting anecdote with respect to getting this information to the President, relates to a meeting which I had, I believe it was last December, with Lyn Nofziger who was formerly Assistant to the President for Political Affairs, at which I presented him an extensive research memorandum prepared by members of my staff, outlining some of the kinds of funding which continued to proceed during the Reagan Administration even though it had been in office for nearly a year.

Mr. Nofziger was quite upset about it. He went in to see the President and the President asked for a copy of the memorandum and Nofziger refused to give it to him because he said that he Page 9 was following standard procedure of routing all papers through Dick Darman who is the President's paper control man. I merely cite that to illustrate the fact that the President is, to a large degree, insulated from acting on what I believe are his personal instincts to take corrective action, because he has a staff which, in the domestic area, favors a policy of non-confrontation and detente with his liberal adversaries in much the same way that Secretary Haig seems to be pursuing a policy of detente vis-a-vis the and foreign policy.

QUESTION;

Do you expect to meet with the President while he is here?

HOWARD PHILLIPS:

No, sir. But I do expect to make this as much of a political issue as possible in his home state of California. We are spending some $77,000 on this campaign. This may not seem like a lot, but it will, in our opinion, accomplish a great deal to bring this to public attention.

One of the things we will be doing is sending to the state of California alone, nearly 100,000 pieces of mail to conservatives on this issue. One of the admonitions that we are making to them is to let the White House know how they feel about fundings of this kind. I believe that because California is President Reagan's home state, it will have more of an impact than if the campaign was simply diffused about the country. We will be doing some mailing around the country, but our heavy mailing on this will be in the state of California.

QUESTION:

Over what period of time?

HOWARD PHILLIPS;

It will be over a period of at least several months. Perhaps longer. It will continue as long as is necessary to inspire action on the part of the President and his appointees.

QUESTION:

How are you funded and can you tell me what politicians in California support or endorse the kind of policy changes that you are asking for now?

HOWARD PHILLIPS;

Well, I cannot tell you which politicians in California would endorse, specifically, each of the recommendations which I have Page 10 shared with you this morning. However, we do have a number of California political figures with whom we have worked closely. One of them is Congressman Bob Dornan. We have also worked closely with and have had as members of our Advisory Board, such individuals as John Rousselot, Norm Shumway, Dave Dreier, and a whole variety of others. I'm looking for a copy of our Annual Report, if I can find it, which has all of their names. I will be happy to share that with you.

In terms of our funding, our organization is funded almost entirely, not entirely, but almost entirely by direct mail. We have an annual budget of some $3 million a year and that budget is raised, with the exception of perhaps $20,000 or $30,000, from direct mail solicitations.

QUESTION;

Where does the rest come from?

HOWARD PHILLIPS:

The rest comes from individual contributions. I hope to solicit some today. I will be visiting with various people around the state of California.

QUESTION:

Can you tell us what corporations or people are funding...?

HOWARD PHILLIPS:

None that would be particularly noteworthy to you. One of them is the Papa Gino Corporation in Massachusetts, which runs a chain of Italian restaurants. The Adolph Coors Company is one which has been supportive of The Conservative Caucus and its work over the years, but I am not aware of any other major corporations. Those are the only two which have made contributions which, in the aggregate would exceed $5,000.

QUESTION:

Did your answer to the earlier question imply that your appearance here today is not intended to have any impact on Tom Hayden's assembly?

HOWARD PHILLIPS:

Well, from what I know of the District, the gentleman against whom he is running has basically the same opinions that he has on such issues as rent control and other issues, but is campaigning on the fact that he is not Tom Hayden. I am not familiar with the Republican candidate to Tom Hayden. My Page 11 understanding is that Mr. Hayden is the favorite in the race. I cannot say that I applaud his political success.

I have known Mr. Hayden since 1960 when he was editor of the student newspaper at the University of Michigan and I was president of the Student Council at Harvard and we debated each other at that time and his views at that time were quite obnoxious to me, and I am sure they are equally obnoxious to me on this occasion. But, we are not here for the purpose of influencing his race. If we had had that in mind, we would have encouraged a candidate to enter that would have done much more than organize a press conference.

Our purpose is to influence the policies of the Reagan Administration and to cause them to understand that the George Bush strategy of consensus politics is not what sustained in the political wilderness over the years, nor the policy which brought him to victory in the New Hampshire primary. It was a policy of frankly raising issues, dealing with them forthrightly, a policy, not of appeasing one's adversaries, but of mobilizing one's supporters, a policy of telling the American people, from the standpoint of what needs to be done, what a policy is, rather than in terms of what may seem, in the short-run, to be politically possible.

I think the American people would rally behind a policy of eliminating funds to political activist groups, as long as it is even-handed and does not simply single out groups of the Left, but which as a general rule, says we do not want to fund politically active organizations, whether they are liberal or conservative.

So far, the liberals have been very successful in keeping alive their organizations during the Reagan Administration and unless the Federal funding for those organizations is eliminated root and branch, after President Reagan is gone, when another liberal Democratic administration, at some point down the road, occupies the White House, they will be able to build back up very quickly the kinds of fundings to which they became accustomed during the heydays of Sam Brown and Marge Tabankin at the ACTION agency and the Jimmy Carter presidency in general.

QUESTION;

For the purposes of your figures, how do you define Groups Allied with Hayden and Fonda?

HOWARD PHILLIPS:

Well, let me answer that by example, if I may. Organizations that have - Page 12

QUESTION;

Is it possible for you to give a broad description of you define...?

HOWARD PHILLIPS:

Certainly. Groups allied with Tom Hayden and Jane Fonda, are groups in which they have either played a direct, personal role or role of cooperation on issues of common concern. For example, the Citizen Labor Energy Coalition, in addition to having Tom Hayden on its board, is a group which shares the Hayden/Fonda viewpoint on nuclear energy.

The Laurel Springs Institute, which was purchased by Tom Hayden and Jane Fonda in 1977, is an organization which has trained community organizers over the years and, from looking at the attendance list, I see that, if you will forgive me for mentioning your name, that Mary Humboldt, who has been a leader of the Laurel Springs Institute or a director of that, is here today. Well, she was a CED fund raiser in 1978. She organized the CED chapter in Oakland. She was active in the Hayden campaign in Orange County in 1975 and 1976. She worked in Americans Against the in London in 1972 and 1973. I would say that is certainly an organization that could be fairly said to be allied with Tom Hayden and Jane Fonda.

QUESTION:

You also include the Sierra Club?

HOWARD PHILLIPS:

Yes. The Sierra Club and the Friends of the Earth are in there by virtue of the activities they have shared with Tom Hayden and Jane Fonda on issues like solar power and nuclear energy. In some cases, it has been by association through the Western Sun Program in which Mr. Hayden played a key role. One of the lobbyists for the Friends of the Earth is a CED activist by the name of Mark Vanderveldon. There have been active associations in each of these cases-

QUESTION;

You seem to be criticizing a great deal many of the people who are advising and running the President's program. Have you talked to the President about who you think should replace these people or who these people are who should be replaced?

HOWARD PHILLIPS;

I'm not sure the President would place a high priority on my Page 13

recommendations in that area. I have not communicated my views directly to him, because I have not had the opportunity to do so. I have in a more general way, through regular public...TAPE ENDED HERE.

SIDE TWO OF TAPE PICKED UP WITH:

...as was demonstrated in his able management of the Ford campaign in 1976 against Ronald Reagan and the Bush campaign in 1980. There are reasons why he supported Ford and Bush over President Reagan, and those are manifest in his mode of operation, in his selection of personnel. Dave Gergen is chief spokesman for the President, Dick Darman is the fellow who controls the paper flow.

I think the President needs a major shake-up and I think that when you look at his foreign policy and see him overturning his positions of a lifetime, with respect to Taiwan, for example. When you see his Administration, on the prompting of such people as David Rockefeller and the Gulf Oil Corporation, moving towards a normalization of relations with pro-Soviet Angola while Cuban troops remain.

When you see his State Department in Latin America talking about the possibility of resuming aid to the Sandinistas, and even guaranteeing the safety of their regime from external threat. Clearly, it is not his foreign policy.

In the domestic area, a man who, over the years has been identified with fiscal prudence, for him to propose budget deficits which could reach $875 billion is, I think, the result of his being almost uniformly surrounded by people who do not share the premises and beliefs on which he campaigned.

QUESTION:

How do you explain the acceptance of the people who are against his policies with...inaudible..?

HOWARD PHILLIPS:

Well, newsmen frequently say, "Aren't you really dodging the issue, blaming the staff rather than blaming President Reagan?" The conclusion must be drawn that the President is ultimately responsible for these decisions and I think I understand why he is doing it. I think his strategy is that in order to move the country, he has got to do it by consensus, by, in effect, detente with his adversaries rather than through a strategy of political confrontation.

But, I believe that, unless the President confronts all of those elements in the academic world, in the media, in the business t'Jt Page 14

community, in the bureaucracy, in the banking community, which disagree with the policies of change which he proposed, he will simply be an instrument for carrying forward those policies and, while he may purchase short-term personal acceptance or popularity, in the long-term his presidency will not have been the historic watershed which the times so clearly require, (not the L,A. Times, but the times in which we live).

Are there any further questions? If not, I thank you very much for coming.

By the way, one of the other groups that has, over the years, received Federal funding is a group called Nine to Five, which is an office workers union which Mrs. Hayden had something to do with.

QUESTION

How long have these mailings been going on?

HOWARD PHILLIPS

They just began about a week ago.

QUESTION

Have some of them been mailed here in California?

HOWARD PHILLIPS

Oh, yes. If you wil hold on a second, I will give you the exact number so far.

QUESTION

How long has this project existed?

HOWARD PHILLIPS;

We started planning the project, oh, I guess in early April or late March and it really has just begun to get under way. On May 17, 10,000 Hayden-Fonda packages were mailed. Of those, 2,000 were California. On June 5, 60,000 were mailed. Of those, 27,000 were California. Perhaps earler, on May 26, in other words, in two days, 60,000 were mailed, of wliich 27,000 were California. Assuming that is correct, we will mail to a total of 400,000 with an additional 65,000 of those being in California.

QUESTION;

Will these be spread all over California, according to...