Tuesday, May 11, 1971 - 4:52pm - 4:53pm
Richard Nixon, George Shultz, John Connally
White House Telephone

President Nixon: Hello.

Operator: [Treasury] Secretary [John B. Connally].

John Connally: Yes, sir.

President Nixon: [Office of Management and Budget Director] George Shultz just got a little piece of economic news I thought you'd like to hear about. Here he is.

Connally: Great.

George Shultz: Hello.

Connally: Yes, sir.

Shultz: John, I just got the revised GNP [Gross National Product] figures that'll be released Friday. And the first quarter instead of being up 28.5 [billion dollars] it's up 30.8.

Connally: God almighty.

Shultz: So we did get up above the 30 billion mark.

Connally: Yeah, up to 30, yeah.

Shultz: And that's really, it's a 7.1 percent real increase instead of 6.5 percent.

Connally: 7.1.

Shultz: That's not the highest quarter-to-quarter increase ever. But it's in percentage terms, constant dollars, but it's damn near it. [Unclear interjection by Connally.] There were a few quarters back in the middle-60s.

Connally: Hmm. Boy, that's great.

Shultz: So that really shows that our thinking hasn't been too far off.

Connally: That is great. Gee, that's wonderful. I'm amazed at--”I thought you might get up to 29.5, maybe possibly 30. But 30.8, that's up over 2 percentage points.

Shultz: Yeah.

Connally: Well, I mean up over $2 billion.

Shultz: Yeah.

Connally: God, that's terrific.

Shultz: 2.3 billion.

Connally: 2.3 billion.

Shultz: And the good thing about it in terms of our annual estimate is, anything that goes in the first quarter, of course, will count four times, so to speak, in the averaging.

Connally: Right, right, right.

Shultz: So that it's much better to get the rise in the first quarter than the last.

Connally: Right. Gee, that's wonderful. That's just great. [Laughs.]

Shultz: OK.

Connally: I couldn't be happier, George. Thank you, sir.

Shultz: Yeah. That's Friday['s] announcement.

Connally: Sir?

Shultz: Friday is the announcement day.

Connally: Yeah, yeah. OK, bye.

Original tape courtesy of the Nixon Library. This transcript is a working draft. Please let us know if you find important errors.