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	TBP SPEECH "PETROLEUM & POLITICS 1982" REPUBLICAN MEN'S ASSOCIATION AND PROFESSIONAL REPUBLICAN WOMEN'S ASSOCIATION CENTENNIAL ROOM FIRST NATIONAL BANK AMARILLO, TEXAS MARCH 11, 1982

THURSDAY, 7:30 P.M.

I. INTRODUCTION - I WANT TO THANK CAL ELLIS FOR INVITING ME TO SPEAK WITH YOU TONIGHT.

A. SPEAKING TO A GROUP OF REPUBLICANS IS SOMETHING I ESPECIALLY LIKE TO D0. HOWEVER, I FEEL LIKE THE PREACHER WHO PREACHES TO THE CHOIR.

B. CAL HAS ASKED ME TO SPEAK ABOUT "PETROLEUM AND POLITICS-1982".

1. I WILL GIVE YOU A BRIEF REVIEW OF THE PETROLEUM BUSINESS AS I CURRENTLY SEE IT, THEN I WILL TURN TO TEXAS POLITICS WITH PARTICULAR EMPHASIS ON THE GOVERNOR'S RACE.
2. FOLLOWING MY REMARKS, I WILL BE PLEASED TO ANSWER QUESTIONS.

II. NOW LET'S TAKE A LOOK AT THE PETROLEUM INDUSTRY.

A. THE PETROLEUM INDUSTRY MAY BE CHARACTERIZED AS AN INDUSTRY THAT HAS ALWAYS HAD TO MAKE ADJUSTMENTS.

1. THE AMERICAN PEOPLE BECAME PAINFULLY AWARE OF THIS FACT DURING THE 1970'S AS THEY SAT IN LONG LINES AT GASOLINE STATIONS...DUE TO THE SO-CALLED "GAS SHORTAGES" CREATED BY A DISTURBANCE IN THE SUPPLY OF CRUDE OIL FROM OPEC NATIONS.
2. OIL COMPANIES AND INDIVIDUAL ROYALTY OWNERS ALIKE WERE HIT WITH THE "WINDFALL PROFITS TAX" BY THE CARTER ADMINISTRATION—ANOTHER ATTEMPT BY BIG GOVERNMENT TO PERPETUATE ITSELF.

B. WE ARE GOING TO SEE EVEN MORE ADJUSTMENTS. IN THE PETROLEUM BUSINESS DURING THE 1980'S.

1. OIL AND GAS COMPANIES ARE HAVING A DIFFICULT TIME RIGHT NOW—LOOK AT THE STOCK MARKET—THE COSTS OF FINDING OIL ARE INCREASING; QUALIFIED SERVICE PERSONNEL ARE FEW AND FAR BETWEEN.

C. THESE PROBLEMS HAVE NOTHING TO DO WITH ANYTHING THAT PRESIDENT REAGAN OR GOVERNOR CLEMENTS HAVE DONE.

D. OIL AND GAS COMPANIES ARE BEGINNING TO UNDERSTAND THAT THEY ARE MANAGERS OF DEPLETABLE ASSETS,(I.E. RESERVES) AND THE CONTINUED REPLACEMENT. OF PRODUCTION IS ESSENTIAL TO THE MAINTENANCE AND GROWTH OF THE SHAREHOLDERS INVESTMENT. THEREFORE, THE OPTIMUM RESERVE BASE FOR ANY SIZE COMPANY IS ONE WHICH CAN BE REPLACED ANNUALLY.

1. THIS IS BECOMING INCREASINGLY DIFFICULT FOR MANY COMPANIES TO DO.
2. I BELIEVE WE WILL SEE MORE SELLOUTS AND TAKEOVERS IN THE INDUSTRY INVOLVING THOSE COMPANIES THAT ARE UNABLE TO REPLACE THEIR RESERVES.

E. IT'S AMUSING TO ME THE COMMENTS THAT ARE CURRENTLY BEING MADE ABOUT THE OIL GLUT—WHEN WE ARE STILL IMPORTING 35% OF OUR OIL.

1. I BELIEVE WE WILL SEE THE PRICE OF OIL BOTTOM OUT SOON.
2. THE DECLINING PRICES HAVE HELPED THE CONSUMER AND HAVE BEEN HELPFUL TO THE REAGAN ADMINISTRATION IN DEALING WITH THE PROBLEMS OF INFLATION.
3. BUT, LET THERE BE NO MISUNDERSTANDING—THE SAUDIS ARE IN CONTROL OF OPEC PRICES.

F. PRESIDENT REAGAN RECOGNIZE[D] THE [HANDWRITTEN ADDITION: NEGATIVE] AFFECTS {STRICKEN TEXT: BIG} [HANDWRITTEN ADDITION: OF] GOVERNMENT [HANDWRITTEN ADDITION: INTERFERENCE WITH] THE OIL BUSINESS.

1. IN ONE OF HIS FIRST MOVES TO "GET GOVERNMENT OFF THE BACKS OF AMERICANS," PRESIDENT REAGAN DECONTROLLED THE PRICING OF CRUDE OIL.
2. THE FEARS OF MANY WHO THOUGHT DECONTROL WOULD HURT THE CONSUMER HAVE NOW FADED WITH THE DECLINE IN GASOLINE PRICES.

G. WE BELIEVE THAT DECONTROL OF NATURAL GAS WILL ALSO BENEFIT THE AMERICAN CONSUMER AND HELP OUR COUNTRY ACHIEVE ITS GOAL OF ENERGY INDEPENDENCE.

1. ALTHOUGH WE DO NOT EXPECT DECONTROL OF NATURAL GAS THIS YEAR, WE {STRICKEN TEXT: DO} [HANDWRITTEN ADDITION: IF AND WHEN IT COMES] EXPECT A WINDFALL PROFITS TAX TO ACCOMPANY THIS ACTION—EVEN THOUGH PRESIDENT REAGAN HAS STATED THAT THIS IS NOT HIS PLAN.
2. CONSIDER THIS...EVEN WITHOUT A WINDFALL PROFITS TAX ON NATURAL GAS, THE GOVERNMENT WOULD RECEIVE $28 BILLION A YEAR IN ADDITIONAL REVENUES FROM OTHER TAXES RESULTING FROM DECONTROL (53 CENTS ON THE DOLLAR).

{STRICKEN TEXT: II. THE CHANGES THAT PRESIDENT REAGAN HAS PROPOSED FOR THE OIL AND GAS BUSINESS WILL GIVE NEW LIFE AND VITALITY TO ONE OF THE NATION'S MOST IMPORTANT ASSETS AN AGGRESSIVE OIL AND GAS INDUSTRY.} [HANDWRITTEN ADDITION: THATCHER, TRUDEAU]

III. NOW, LET'S TURN TO POLITICS.

A. THE ELECTIONS OF 1982 WILL BE MOST IMPORTANT TO US—AT ALL LEVELS—LOCAL. STATE AND NATIONAL.

B. WE SHOULD DO ALL THAT WE CAN TO ELECT REPUBLICANS AT EACH LEVEL.

C. WHILE I AM INTERESTED IN ALL RACES, AS STATE CHAIRMAN OF THE CLEMENTS CAMPAIGN, MOST OF MY TIME AND EFFORTS ARE BEING DIRECTED TOWARD THE GUBERNATORIAL RACE.

D. IT IS MY OPINION THAT IF BILL CLEMENTS WINS, OTHER REPUBLICAN CANDIDATES WILL SHARE IN THE VICTORY.

E. AND IT IS VITAL THAT BILL CLEMENTS WIN—I BELIEVE A LOSS TO THE DEMOCRATS IN TEXAS IN 1982 WILL CONSIDERABLY HELP THE DEMOCRATS ELECT A PRESIDENT IN 1984.

F. REGARDLESS OF THE OPPONENT, WHETHER IT BE MARK WHITE, BUDDY TEMPLE, OR BOB ARMSTRONG, WE ANTICIPATE A HARD FOUGHT CAMPAIGN.

G. BILL CLEMENTS SURPRISED THE DEMOCRATS IN 1978. THEY ARE WORKING TOGETHER THIS YEAR TO ELIMINATE THEIR MISTAKES OF '78. THEY ARE COLLECTIVELY FOCUSING, ON ONLY ONE THING-THE DEFEAT. OF BILL CLEMENTS (BUT THIS WILL PROBABLY CHANGE AS THE DEMOCRATIC PRIMARY HEATS UP).

H. AS THE FIRST REPUBLICAN GOVERNOR IN TEXAS SINCE RECONSTRUCTION DAYS, I BELIEVE BILL CLEMENTS IS THE BEST GOVERNOR OUR STATE HAS EVER HAD—AT LEAST DURING MY LIFETIME.

I. LET'S LOOK AT HIS RECORD...A RECORD OF A MAN WHO CARES FOR ALL TEXANS.

J. WHEN BILL TOOK OFFICE AS GOVERNOR IN JANUARY, 1979. THERE WERE THREE ISSUES THAT THE PEOPLE OF TEXAS WERE MOST CONCERNED ABOUT:

1. EDUCATION
2. DRUG ABUSE AND CRIME
3. GROWTH OF STATE GOVERNMENT

K. TO ADDRESS THESE AND OTHER ISSUES, GOVERNOR CLEMENTS BROUGHT A BUSINESS-LIKE APPROACH TO GOVERNMENT.

1. HE HAS BEEN VERY EFFECTIVE IN BRINGING INTO GOVERNMENT AS VOLUNTEERS, SUCCESSFUL BUSINESSMEN WHO STUDY PROBLEMS AND OFFER SOUND SOLUTIONS [HANDWRITTEN ADDITION: AT NO COST TO THE GOVT]. THIS HAS BEEN DONE THROUGH HIS MANAGEMENT EFFECTIVENESS PROGRAM.
2. BY ORIGINATING THE TEXAS 2000 COMMISSION. GOVERNOR CLEMENTS ENGINEERED A LONGRANGE PLANNING STUDY FOR TEXAS, AS A RESULT, THE STATE OF TEXAS, FOR THE FIRST TIME IN ITS HISTORY HAS A LONGRANGE PLAN THAT ADDRESSES FUTURE NEEDS OF A GROWING TEXAS—PROBLEMS WITH HOUSING, SCHOOLS, TEACHERS, TELEPHONES, WATER, POWER AND OTHER NECESSITIES THAT WILL BE NEEDED BY THE 21 OR 22 MILLION TEXANS LIVING IN OUR STATE BY THE YEAR 2000.

L. WHAT DID GOVERNOR CLEMENTS DO ABOUT RUNAWAY GROWTH IN STATE GOVERNMENT? WELL, THROUGH EFFECTIVE MANAGEMENT PROGRAMS HE STOPPED THE GROWTH OF STATE GOVERNMENT DEAD IN ITS TRACKS—FOR THE FIRST TIME IN 30 YEARS.

M. IN THE AREA OF CRIME. GOVERNOR CLEMENTS ESTABLISHED A WAR ON DRUGS COMMITTEE (H. ROSS PEROT) AND INTRODUCED THE TOUGHEST ANTI-CRIME LEGISLATIVE PACKAGE IN HISTORY. THE LEGISLATURE RESPONDED BY PASSING 14 OF THE GOVERNOR'S 16 KEY ELEMENTS. {STRICKEN TEXT: THESE BILLS PROVIDE}

1. {STRICKEN TEXT: FINE AND PENALTIES UP TO $1 MILLION—BASED ON THE QUANTITY OF NARCOTICS IN POSSESSION.}
2. {STRICKEN TEXT: AN INCREASED ECONOMIC RISK FOR DRUG TRAFFICKERS BECAUSE INVESTMENTS BY DRUG DEALERS IN OTHER ENTERPRISES CAN BE FORFEITED.} [HANDWRITTEN ADDITION: THESE LAWS WILL BE A MAJOR TOOL TO COMBAT THE GROWING DRUG TRAFFIC WHICH NOW AMOUNTS TO $3 BILLION ANNUALLY IN TEXAS]
3. {STRICKEN TEXT: TOUGHER PUNISHMENT FOR ADULT WHO PROVIDE DRUGS TO MINORS.}
4. {STRICKEN TEXT: AUTOMATIC REVOCATION OF THE LICENSES OF PHARMACISTS AND PHYSICIANS WHO ARE CONVICTED OF DRUG VIOLATIONS.}
5. {STRICKEN TEXT: THE OUTLAWING IF "HEAD SHOPS" WHICH DISPENSE DRUG USER PARAPHERNALIA.}
6. {STRICKEN TEXT: INCREASED PENALTIES FOR AGGRAVATED RAPE.}
7. {STRICKEN TEXT: INTRODUCTION OF ORAL CONFESSIONS AT FELONY TRIALS.}
8. {STRICKEN TEXT: UP TO $25 MILLION ANUALLY TO FUND THE CRIMINAL JUSTICE DIVISION.}
9. {STRICKEN TEXT: A SEPARATE JUVENILE PROBATION COMMISSION TO ADMINISTER A QUALITY STATE-WIDE PROBATION SYSTEM FOR YOUNG OFFENDERS.}
10. {STRICKEN TEXT: STRONGER CONTROLS OVER THE OFTEN ABUSED BAIL BOND SYSTEM.}

N. THE THIRD AREA OF MOST CONCERN TO TEXANS WHEN GOVERNOR CLEMENTS ASSUMED OFFICE WAS EDUCATION. BILL CLEMENTS FORMED A BLUE RIBBON TASK FORCE Off EDUCATION AND INTRODUCED A COMPREHENSIVE PACKAGE OF LEGISLATION DEALING WITH EDUCATION. RESULTING LEGISLATION WILL:

1. RETURN THE TEXAS CLASSROOM TO THE BASICS OF READING, WRITING, ARITHMETIC AND DISCIPLINE.
2. REQUIRE TEACHERS TO PASS COMPETENCY TESTS.
3. SET UP ALTERNATIVE LEARNING OR GUIDANCE CENTERS FOR DISRUPTIVE STUDENTS.
4. ESTABLISH A PILOT PROGRAM TO ENCOURAGE LOCAL DISTRICTS TO USE SUMMER SCHOOLS TO ASSIST STUDENTS WHO FALL BELOW GRADE LEVEL AND TO PROVIDE SPECIAL AID TO STUDENTS WHO HAVE DIFFICULTY WITH THE ENGLISH LANGUAGE.
5. DIRECT A STUDY TO DETERMINE THE KIND OF VOCATIONAL TRAINING NEEDED TO FILL THE THOUSANDS OF JOBS AVAILABLE IN BUSINESS AND INDUSTRY.
6. DESPITE THE VOCAL ARGUMENTS FROM THE TEXAS STATE TEACHERS ASSOCIATION, AN ORGANIZATION INTERESTED IN THE UNIONIZATION OF TEACHERS, BILL CLEMENTS ESTABLISHED A SOLID RECORD IN THE FIELD OF EDUCATION.

O. DESPITE THIS RECORD OF ACHIEVEMENT, REELECTION WILL BE DIFFICULT.

1. WE CANNOT LET THIS RACE BE A RACE BETWEEN A REPUBLICAN AND A DEMOCRAT.
2. BECAUSE OF OUR NUMBERS, WE MUST PERSUADE INDEPENDENTS AND CONSERVATIVE DEMOCRATS TO SUPPORT BILL CLEMENTS.
3. (COMPARE THE DEMOCRATIC CANDIDATES WITH A MAN WHO HAS MADE IT ON HIS OWN IN BUSINESS, HAS BEEN SUCCESSFUL AND IS NOW APPLYING SUCCESSFUL BUSINESS PRACTICES TO GOVERNMENT).

IV. IN CONCLUSION.

A. I WANT TO ACKNOWLEDGE YOU FOR YOUR COMMITMENT TO BECOME INVOLVED. IN POLITICAL AFFAIRS THROUGH YOUR RESPECTIVE ORGANIZATIONS.

B. WE MUST WORK HARD AND WORK TOGETHER TO ELECT PEOPLE WHO SHARE OUR COMMON BELIEFS. [HANDWRITTEN ADDITION: CONGRESS]

C. I WANT TO ENCOURAGE YOU TO CONTINUE TO WORK FOR ALL REPUBLICAN CANDIDATES. AND BE VISIBLE IN YOUR SUPPORT FOR GOVERNOR CLEMENTS.

D. BILL CLEMENTS APPROACHES HIS JOB AS GOVERNOR AS A BUSINESS MANAGER WHO IS SERIOUS ABOUT THE FUTURE OF TEXAS. [HANDWRITTEN ADDITION: BEN HOGAN]

E. HE IS A LIVING EXAMPLE OF THE FREE ENTERPRISE SYSTEM—WHAT AMERICA IS ALL ABOUT. HAVING BEEN SUCCESSFUL IN BUSINESS, HE IS NOW PUTTING HIS TALENTS AND ENERGIES BACK INTO THE SYSTEM FOR THE BENEFIT OF ALL TEXANS.

V. THANK YOU FOR YOUR ATTENTION. NOW I WILL BE PLEASED TO ANSWER YOUR QUESTIONS.