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	JOINT MEETING OF REPUBLICAN MEN'S ASSOC. & PROFESSIONAL REPUBLICAN WOMEN'S ASSOC. March 12, 1982

I want to thank you very much for asking me tonight. It's fun to stand up in front of a group of people from home, friends and all. I sort of feel like a neophyte in politics and I know that some of you are veterans and have worked hard on some of these races. I somehow got caught up in it several years ago.

My comments tonight may be somewhat like talking to Noah about the flood, so bear with me. I can talk about the oil business pretty authoriatively and I will launch into that first. Cal said not to make that too long because these people really aren't interested in all of this, or at lease maybe not all of them are. I'll make a few comments tonight and just give you an overview as I see it because, let me tell you that the oil business is changing very rapidly of course, and those that are in it know what I'm talking about. Those that are on the edge of it haven't really felt it yet, it's changing. I won't stay with that very long and I'll get on to the Governor's race and when I get through I would appreciate any questions you might have and will be glad to stand here and answer for as long as you have questions.

In the 70's, you remember the long gasoline lines we saw. The panic in Washington was horrible. And of course, immediately the reason for the lines is pretty well understood now, was not because of the oil industry, but because our country had become so dependent on foreign crude oil. Very simply that was why we had the gasoline problem. So it was the politicians that were there at the time that had to have some reason for all this happening and naturally they would never admit they made a mistake, so we have to find somebody to lay it on. The oil companies all at once were the scapegoats. People have said, "Pickens, you were not a fraud, but the major oil companies were the ones that were doing it to us". That is not right. The major oil companies were just a victim of OPEC very simply, in fact, this country started importing about 45% of their oil, and OPEC, as far as I am concerned, did no different that what we would have done. There is no way that if somebody wants to buy your corn for $20 a bushel that you are going to say, "no, I don't think that is right, I'm just going to let you have it for $3.50". It isn't going to work that way. Let's say somebody comes around and offers you $100,000 for a house you paid only $10,000 for. You aren't going to say, "no, $25,000 will be enough". That is just not life, it's just not realistic. We got hooked on OPEC oil and we got dependent on it and they can read the Oil & Gas Journal just as well as we can. When they saw those numbers stepping right on up, there wasn't a doubt what they could do.

As we roll along into the Carter administration, of course, there was nothing accomplished in the Carter administration as far as I am concerned, not only for the oil industry, but for anything else. The Windfall Profits Tax was the sadest thing that ever happened, but it's really interesting how royalty owners didn't realize that they were caught in this same trap. We have royalty owners that couldn't believe it when Windfall Profits Taxes were paid and checks went down. They thought it was just the oil companies that were stuck.

It's interesting how things have progressed. As we go into the 80's we will see the darnedest bunch of adjustments that ever happened to the industry. You can see that right now just by looking at the stock market. You can see for instance what Wall Street thinks of oil companies' stocks. They are killing us. It's not just Mesa, but you can go right down the list. What they are telling you is that they don't have a great deal of confidence that the oil industry is going to have much of a future as far as growth is concerned. They are going to find that it's not the case. We are also finding that the root of a great part of our problems in the oil business, very simply, is the cost of finding oil. This is going up right now. Our best estimate by our company people is that finding a barrel of oil is costing $20 per barrel. That is what it is costing the industry today. Now, you have people like Charles Maxwell, who is probably known as the All American Analyst for the oil industry. Charles said we can very well see the price of oil down $20 per barrel. If you are finding oil for $20, selling for $20, but producing over a 5 to 10 year period and discounting the fact the present working barrel of oil at $20 per barrel may not be worth $10 per barrel, you are losing money going in. You are getting ready to see things here that are going to be very interesting. The business is going to get tough and hard.

Back three or four years ago if you got the business and had the deal, you could sell it, drill it, and hope it would bounce up. But if it didn't, and you made a few bucks on it, just move on and you are back to digging holes again. That stopped very, very fast.

Rigs are going down right now. I talked with Ed Morris (with Pioneer Corp) last week who is very, very close to the count of drilling rigs, and he told me that on 600 rigs operating in Williston Basin, 200 are stacked. So 1/3rd of the rigs in Williston are stacked. It was less than 2 years ago that we were frantically scratching and looking for rigs in Williston. We have 4 rigs operating up there right now and within another 90 days we will be back down to 1 rig operating in Williston. Things are changing and it is because the cost of finding oil is so high it is not the smart thing to do to continue to pour money into those projects. I am on Hughes Tool Company's board and Hughes keeps a number of rigs that operate on a day to day basis. They have 4,500 rigs average for the year. Ned Broun, the Executive Vice President was the one to keep this recount and made these predicitions. The other day I called Ned and we are now down to 3,850 rigs. The prediction by Hughes was to have 4,500 rigs operating daily in 1982 and we have already peaked and headed down. I called Ned and his secretary answered and I told her, "This is Boone Pickens" and she said, "Oh my gosh, Ned wants to talk to you". I asked, "Where is he, under his desk?" And she said, "No, but almost!" Ned picked up the phone and said, "You were right on the rig counts. Turn it off, I've had enough!" This is catching people by surprise, so you are going to see this. These problems have nothing to do with President Reagan or Governor Clements. Neither one of them have had anything to do with rigs coming down which is a real barometer for how the business is doing.

It's amusing to me that the comments that are currently being made about the oil glut on the TV. They will lead you to believe that there aren't any problems there, that there is plenty of oil. Why is anyone going to be disturbed about that? Well, the truth of that is that we have cut back consumption but we still import 35% of our oil. All we have to do is have an interruption and then we have a crisis, and I can imagine who will get blamed for that. If somebody drops a bomb on the Saudi's, and you know, that could very likely happen too if one of the other mideast countries get started over there, they could get those oil fields shut down very quick. An interruption of 90 days could be devastating to this country. I think we have about bottomed on the oil process although it could go to $20 per barrel, and that was Charlie Maxwell's figure, not mine. I think we could go on down to $28 and that's where we would feel would be the bottom. The declining prices has helped the consumer and that is good. I have had people ask me, "Aren't you just sick about the oil prices going down"? No, I'm really not that sick about it because I am more interested in our country and I am glad to see inflation come down and the price of oil coming down. does make a difference in inflation and is also helpful to the Regan Administration, just one of the few things that seem like are working for us right now. Leave no misunderstanding that the Saudi's are totally in control of the price of crude oil. They can bring it up or they can bring it down. The reason is that they have the flexability to produce 10 million barrels a day and also have the flexability to bring it all the way down, and before their economy gets into trouble, they can bring it all the way down to 4 1/2 million barrels. They have just recently announced that they are cutting back to 7 million barrels a day and their is alot of flexability between 7 and 4 1/2, so they can bring that down even further. Now, they may punish some people here by dropping this price and what it does is bring the OPEC nations in line with their thinking. They want to be sure that they have made a glut and they can now shorten it up when they get ready to. Just watch to see just what is going to happen to the oil prices by watching to see what the Saudi's are producing.

In one of the first moves the Regan administration had was to decontrol crude oil and you know the fears were something. The nonproducing state Senators and Congressmen saying, "Gosh, we are going to have $3.00 gasoline before sundown", and it is interesting because we have decontrolled and the price has actually gone down which is not totally due to decontrol, but it has been a factor in bringing it down. We have the problem now of decontrol of natural gas which we are not going to have in 1982. The industry has made it very, very clear that we are not going to have it. I think that there is a very real prospect on natural gas that you are not going to have decontrol in 1983. I think that it may be a dead issue. I think it all hinges on what happens to the Regan administration over the next few months as to wether this issue will come up in 1983. But, if we don't have decontrol in 1983, we will fase into decontrol in 1985 under the natural gas act of 1978-if we have a Republican administration. If we don't have a Republican administration, then all of the safeguards in there as the Democrats see it to cut off decontrol, can very well do it to us. I don't think there is any doubt that if you go into 1985 with a Democratic administration you are dead for decontrol. I think it is very very likely that natural gas in that case would never be decontrolled in this country.

Let me be brief and to the point that we found an oil field in the North Sea in 1976. It was a nice oil field just 14 miles off the Scottish coast up in the North Sea. and that oil field was named after my wife. Beatrice Field was the name of the field. I want to tell you something funny. We went over to the opening of the Mesa offices in Aberdeen, and that evening we had all of the local men over. I was always interested that the group that seemed to have the most prestige in that city was the Highlands and Islands Conference. I thought that was a pretty clever name for them as they did wear kilts. This old gentleman came in and had had a little bit too much to drink and fell in love with my wife. He visited with her, talked to her during the evening. We were trying to get them all out of there and it was getting pretty late and we had to go to a dinner, so I went over and stood by the elevators that opened into the lobby of our offices. Finally we got everybody out and this gentleman in the kilt came over to me and told me how nice my wife was and how he enjoyed visiting with her. As he got into the elevator he said to me, "And it was very nice to have met you too Mr. Field". We were there in 1976 and we could see what was happening to us. The government knew every move that we made. You could not have a meeting without the government sitting in on it with you. So, we got to looking at it and decided we needed to get out of this deal because it just didn't suit our personalities at all, to have this kind of surveillance. They were helping us spend our money, which annoyed me. Everything kept running the cost up. We owned 25%, Kerr McGee owned 25%, the Hunts owned 25% and the other 25% was owned in the UK by Peninsula & Oriental Steamship Company and some others. The first time we looked at the cost to develop that oil field, it was three hundred million dollars and that looked very reasonable. When we went through six hundred million dollars and we weren't even half-way through the development, I said, "That is all for me". Margaret Thatcher was just ready to be elected at that time and I was interested in their polls. They showed her 25% over the other candidate and the UK people that we had on our payroll said that it wouldn't last. What will happen is that it will narrow quickly and just watch it evaporate and probably she won't even win. Day by day she was going down in bunches, even in the last two weeks. We sold out and signed about three days before the election and Margaret Thatcher did win by a rather narrow margin. She went into that election saying that she would never tax the oil companies in the North Sea again, that they had paid enough. Since then, she has taxed them three times. Now, I don't think Margaret Thatcher is dishonest, I just think that when she stood up there and said she wouldn't tax the oil companies again, that is just exactly what she planned. But what happened was, her country got into such bad shape, and there were so many people that weren't working that had to be. hauled in that government, that it was just a case that she had to tax the only place left to tax, which was the North Sea oil. That is what they did. If you look at the situations here in our country and if we don't get control of this situation, I think the Regan administration can be tracking Margaret Thatcher right now. That very well may be the place that they have to look to is the oil & gas industry. This is one industry that they may believe they can take some more out of and that is where you could have Windfall Profits on natural gas.

Let's move to Canada in 1979. Thatcher came in and we pulled out just ahead of that. We had been in Canada since 1959 and we sold out in 79. Treadeau, back before he had the majority to do the things he has done in Canada in the last year, had shown his color. But he didn't have the majority. He lost. Joe Clarke came in, we sold out while Joe was in and he only lasted nine months-and his government fell and the Treadeau government that came back in had the majority to absolutely nationalize the oil business in Canada. So, in the UK you had the National British Oil Company and Canada had PETRO-Canada, both national oil companies. Now here we are in the United States. If in 1984 we lose, we just can't lose, not only just for the oil business, but also-for our country, but if we lose in 1984, I think you very well are going to have PETRO-USA. You will have a national oil company. I think they are lined up to go and I think that it will be so quick that we won't believe it when it happens if we lose in 1984. So, it is interesting that if they decontrol natural gas today, that it will mean twenty-eight billion dollars in government revenues without a Windfall Profits Tax. Let me just give you what that means. Every $1.00 increase for natural gas now will. give the government $.53 out of every dollar without Windfall Profits Tax. When everyone started talking about Windfall Profits Tax on natural gas, several Congressmen said, "We will put 100% Windfall Profits Tax on it". Whatever increase there was, the government would take it. Then one Senator said he thought there should be 110% Windfall Profits Tax. Then the industry said forget decontrol because it is getting so wild.

Let me get off the oil business. I may touch it as I go on, but I think the elections in our state in 82' are probably going to be the most important ones we have seen, maybe ever. I think that if we can't elect Bill Clements again the the State of Texas, it is very, very likely that we are getting the picture as to what is going to happen to us in 1984 in the Presidential election. I really believe that it is a must race.

Now, as you know, I am State Chairman for Bill Clements election this time and we are spending alot of time. I know that most of you know what kind of guy Bill is. Somebody told me one time that he was very persuasive. I don't see him that way. He just tells you what he wants you to do and expects you to do it. I've never seen anything like it. When he stood up in front of the Texas Research League in Dallas and said, I" want from everyone of you guys in this room some good, free help in Austin", he got it. He said, "I want some people that know something about data processing, some that are auditors", and went on down the list. He said, "I want them down there, I don't want them to just show up, I want them down there to work and I want them down there all week. I want people assigned to me and I'm not going to pay you a dime for them. I want a show of hands of how many people in this room will send people down to Austin to help?" I'll be darned, everybody in the room raised their hands. He got people that way. It was incredible the kind of high powered help that he got into Austin to do some of these things that needed to be done for you. Now, it is my opinion that if Bill wins, there are going to be alot of other candidates that are going to share in that victory. Of course, the bigger you can pull it off the better chance we have of bringing everybody into the picture. I thought when he first asked me to do it that "I can do it. It will just be a piece of cake." You only have three or four minutes to make up your mind when you get started into one of those conversations. You can say you will think about it, but I'm not too much for letting me think about it. When it is put up to you, if it is something you need to do, then do it. I thought, "well, it probably won't be so tough with an imcumbent and all, this thing could be a piece of cake". Well, let me tell you, I got into that thing and I'll show you what a neophyte I am. I accepted and then I started learning about politics and I started looking at the past races and past votes. Somebody says "an incumbent", and we don't know what an incumbent Republican Governor is because we never had one. When you start looking at that, we are absolutely with the short end of the deal on registered voters and everything else. We have an immediate problem when you start looking at it. I don't think anybody is afraid, but I think we are stupid if we think we can read something in that because it isn't going to be a cinch. It is interesting when you look back on Bill winning in 78. I bet you there are not 15 people here in this room that can honestly raise their hand because they thought that Bill Clements was going to win in 78. Can I have a show of hands of those that thought Bill Clements was going to win. About 15 got it. I didn't raise mine. I voted for Bill Clements. That was just about the time when we were negotiating the sell out of the North Sea in late 78 and I got back and voted and that was my contribution, my one vote. But John Hill. If we ever had a weakling for an opponent, it was John Hill. Two days before that election, he gets on the radio in Houston and said that he was going to win every county in the State. Can you imagine what that would do to somebody that might be inconvenienced to-go vote, that were goinge to vote for him? They wouldn't go vote. I heard someone-say—that when they heard him say that, they knew that John Hill was in trouble.

I hear people talk about the fact that Bill Clements spent seven million dollars in the last campaign and that it was ridiculous to spend that much money. I think that if he had probably spent $500 less than that, he would probably have lost. I think he must have spent exactly the amount of money that it took to be elected because he only won by 16,000 to 18,000 votes. One of his top advisors, Tom Reed, has one of these deals, where if you lose this county, this one, & this one then it's over with. They had the foul up in Harris county where he got a bum number that evening in Austin, so he went on to bed at 10:00. He said, "We are out of it", got upset and walked out of the room with big tears in his eyes. They woke him up the next morning and told him, "You are a winner, Tom". He couldn't believe it. It was that close that Clements did not have a victory party because they didn't know that they had won. So, when you look at the cost of these things, it is expensive. Back in 1980 we said that we can't stand any more of the other side, they are killing us, so whatever we pay in these races is cheaper than letting the other side get in and just widdle us to pieces. We decided we would rather put it in the political races. We supported Senate races all of the US. Pat Berry is sitting back there, just how many did we support Pat? 10 or 11.

I feel sincerely that Bill Clements is such an intent guy that he runs Texas like a business. That wasn't too good to say 10 years ago, because business was bad, but people now are deciding that business is not so bad. Bill concentrates and works hard along with Rita. She is a full time Governor's wife working for the State of Texas. Those people are so dedicated, so intent on their work, and they work for all Texans. I've been with them at times when they were going to relax and you thought you might be surprised at what they said, but they never once indicated to me that they have any interest other than doing a good job for Texas. When he started in 1979 there were three issues that the people of the state wanted him to agress. Education, drug abuse and crime and the growth of the State Governor. Then he went to work on them. He processes that stuff, he looks at it and is a decision maker. When things come up to him, the facts are on the table, if they aren't on the table he throws them back and lets somebody work on them. When those facts come up and they are ready to be decided on, Bill Clements can decide. That's his. whole history, to work in that environment, that you get in there and do something about what has to be done. It's interesting to me how so many people will procrastinate and especially politicians, I'm very, very critical on this. I've gone to Bill on a particular idea and'when I put it over to him and we talked about it for a minute he said that he thought it should be done. I said, "Well, there are going to be some people who aren't going to like it," and he looked at me and said, "It's best for Texas, that is what we are interested in. If they don't like it, they will just have to get to like it." And you know, you are talking about voters. Some politicians would have said, "How many aren't going to like it? How many voters are we going to offend?" He is not that way. We were at a hunting camp last year and we were sitting there having a few drinks and Chuck Pigott who is chairman of the Board of PAC-CAR from Seattle Washington, (they make the Kenworth Trucks) said, "Governor, you are a politician," and Bill said, "Stop right there, I'm not a politician, I'm in politics, now go ahead." Now Chuck is a pretty confident guy and it took him several seconds to regain his composure and come on with his questions, that I thought that is exactly the way Bill Clements sees himself. He really sees himself that way, and I've had people ask if Bill is going to run for Senate when he finishes up as Governor and to me, that is so illogical that Bill will be 68 years old then. Can you imagine a Jr. Senator from Texas when you are 68 years old? Honestly, I would not even ask Bill if he had any asperations of being a Senator. I think he would think I was cuckoo for asking that question.

I've had people ask me what this campaign is going to cost us, and before that question comes up as I am sure it will, we really don't know at this point. We are going to run a campaign that we are going to watch as closely as we can. We have a real watch dog for expenditures who is Peter O'Donnell. Some of you know Peter O'Donnell. He is a dead serious guy that watches very closely all expenditures, mine and Bum Brights and all expenditures have to cleared through Peter. Not anything can be spent without Peter O'Donnell seeing it. But we also know that we have got to win. There is no doubt that we have GOT TO WIN. There is too much at steak in this race. Now when I first went in, and again still remember that I am in the learning curve for sure, and the strategy sessions that I am in, and we have those every month, my talk time is still 1 or 2% is all I get to talk because I really don't have alot to add at this point. But I am learning. The first session, I was under 1%, but I'm doing better now and talking 2%, hopefully somebody is listening. When I was sitting in those meetings, and I thought the first thing to do was to keep the cost down, we have got to fight cost'on this deal, my feeling was, wouldn't it be great to run a tight budget, don't spend anything, we have name identification here, all of these polls look alright, but as things started unfolding and I got more familiar with how this thing was either going to be won or lost, I started to lose my enthusiam for just screwing down the budget just as tight as we could get it. I don't want to frighten you about what we think its going to cost, but we have just absolutely got to win.

The people here in this room are dedicated, I know that, there isn't any doubt that you are for Bill Clements. That is obvious. Again I am talking to Noah and the flood. We have got to elect Bill, and we have got to elect these other Republicans. It is going to be tough on all of us, and there is going to be.alot of time spent. Now, Bea & I are in there to stay for the haul and we are going to work very very hard clear through the campaign. Alot of the people that I am associated with will be hard at work. The other day I had a question asked me that Bill is cold and insensitive to things which is not so. Bill is a very sensitive person but I thought about one time that I read that Ben Hogan was talking to some sports writers after he got through playing a very serious round in the US Open. One reporter made a statementthat, "you really aren't very friendly on the golf course, you don't visit with the galleries, you don't have any funny stories to tell or anything else." Ben said, "I'll tell you how I see that. Go see a business man at his office and see how many funny stories you get from him. Go into his office to talk business, which is what you are there for, to talk business. My office is on the golf course. When I am out there that is my business, nothing funny is going on on that golf course." That's the way I see Bill. Bill is so intent on what he is doing that he comes off as a bulldog. He is into what he is doing. I think he is the first full time Governor since I can remember. Of course we went through the Dolph Briscoe deal which was absolutely a joke. He wouldn't sleep in Austin. He had to go back to Ulvalde to sleep. I'm serious. I bet he didn't sleep 10 nights in Austin when he was Governor. I don't know whether they couldn't move the bed up there or what, but he was comfortable in Ulvalde and that is where he went to sleep. That is absolutely silly. If you are going to be Governor you ought to be in Austin. Bill is there. He is working for all Texans. I have pretty well covered my points that I want to make and I have just about used up the time Cal told me to use. I would like to mention to you this deal on March 20. I am plugging for that. Bill will be here in town. It is a horrible night as I understand. There are two parties for girls that are getting married in town and it's spring break and everything that could have been wrong is wrong as far as the night. It is all keyed off of Borger's Chamber of Commerce dinner the night before. Bill is staying up here for a couple of days and he will be over at the Civic Center. We really need some tickets sold. It is going to be a shame if we go over there and have a sparce turnout for Bill. The tickets are $75 per ticket and it will be catered by Don Strange from San Antonio, and the food will be excellent and will have a bar. We are going to need some help in this. Jerry Walsh is chairman of this. I mentioned last June when some of us were down in Dallas that good government is expensive.

There is no doubt that this is expensive, but I'm telling you that the other government is disastrous. We cannot stand it. We saw our taxes cut, and they talked about how much tax they took off the rich people, but they say that is was disproportioned tax that you were paying, they cut you down on the top side bracket for sure. But they never make it quite clear that the people that go out and make the living and pay taxes or pay the disproportioned amount for those people aren't doing a darn thing. It is just incredible to me how the press and TV people continue to put this stuff out and not even ever be responsible enough to really explain how the tax cut effected all of us. It's interesting, and again we have a tough fight as Republicans always do. That's what we know and I think we get into the trenches well and we rally and fight hard and play tough. I think there is a good chance in November. Senator Baker, I don't know him, but he throws up his hands quicker than anybody I've ever seen. He's on our side? I'm talking outside tonight. I used to tell my children that the one thing they needed to do is talk inside the family, don't ever talk outside the family. You can say pretty well anything you want to inside, but very little outside. Don't show anything but a game face outside, but inside you can bellache if you want to. Howard Baker chokes quicker than anybody in that Senate. He was talking about losing 38 seats. You know, that's a good way to lose 38 seats is to start talking about predicting how many we are going to lose. Losing to me is just something that I don't go for. That is just something that you don't talk about. I just got through losing a racketball match. I thought, get up and be friendly. When I lose, I don't like it, and I don't like the guy I lost to. I'm polite, but I really don't want to be buddy, buddy with him and I really don't want to jaw with him going into the locker room. But Howard Baker, talked about losing 38 seats. I think that already says that our program has already failed. Our program hasn't failed. It's hardly in place and they are already saying that Reaganomics is the worst thing that happened to us. Nobody even knows. Every problem that we have today was an inherited problem. I know that some have come from Republican Administrations too, but we have a guy up there that is sitting concrete. This guy is going to do something. Hopefully it's going to work and I think it will. They quit talking about inflation, and we are down to 6 to 7% inflation and that isn't a factor anymore. I don't even hear that on TV. They don't even say that the President may be doing a lousy job but at least he lowered inflation. But we have inflation coming down and we have unemployment going up and interest rates aren't pulling away from us. We inherited interest rates from the Democratic Administrations that were higher than what we have today. So interest rates have pretty well stayed in, now they did drop off and they have recovered some but we know that these big deficits are a problem. I think we are going to see some trade offs on the deficits and that you are going to see that military is going to be traded on the deal and I think that you are going to see some of these intitlements cut back. I think that the President right now is convincing the American people that we are saddled with payments that nobody even realized we were hooked up to in this country, the tax payers. The factors of just inflation built in to those intitlements are just unacceptable, we can't haul it. To me that is exactly what he is going to impress on the people of this country. When he gets fully through to the responsible tax payers of this country you are going to see them break some of those committments back along with probably military we are going to see some things happen here and we are going to see at the same time some interest rates pull back and I am optomistic, all geologist are, you have to be, as many dry holes as we all drill, but I think by late summer you are going to see interest rates down to 12 to 13%. I think Bolter and the Fed well understand the situtation that even though it is a totally independent group they can't be completely out of it. Ithink you are going to see them stabalize interest rates and you are going to have interest rates at some reasonable, acceptable level. To the public that is going to be taken away as an issue. You are going to see inflation no issue - and unemployment is going to be a problem. I'm not ready to concede that we are going to lose anything in November. I hate to see these fadehards start talking about losing 38. I don't know why they would say something like that. But Howard says alot of things I don't understand. I've gone over-time so I'm open for questions.

Question: There was an article about Clements and the DOE-do you see eye to eye on this?

Answer: Let me say this, I saw the same thing you saw. I think the headlines in the Dallas paper were Clements says-DOE crazy or something like that. I have not talked to Bill and will be with him on Saturday and Sunday of this week and I'm not going to avoid the question. They told me the other day that I don't have to answer every question, but I always feel like I do. But I have not discussed that with him and I am not so sure that I'm not going to find that the Governor of Texas being totally in agreement with the President of the United States about energy may not be the best thing if you want to get something done.When you look at the Congress and Senate with as many nonproducing states as we have in the US that for the President of the US to be taking all of his advice from a state that produces as much energy as Texas does, I'm not so sure that is the best case. So, I don't know what came out of that discussion, whether anything was out of context or reported just exactly as it was said. To me though, that's Bill Clements. He said to the President, "You have no energy plan" and the President didn't answer me. I believe that's what it said in the Dallas paper. I'm sure that may be very accurate. I don't see much of an energy plan since the decontrol of oil. Apart from energy, if we are going to be left with controls on gas, actually wipe out the Department of Energy is going to get everything shifted out to commerce and interior departments and I'm not so sure that that is the best thing to happen for us. I think that if we are going to stay under and be regulated I think we are better off with a Department of Energy regulating this than we are to then have to go and start in with commerce and interior and wherever they shuffle us off to. I don't want a Department of Energy. Now I'm supposing that is what you are going to find if you talked to Bill tonight, he would say that if we are going to be regulated we have to have a Department of Energy. Right now there is no doubt that there is a move afoot to administratively decontrol certain classifications of gas. You are talking about gas between 10 & 15 thousand feet being decontrolled to a certain extent and gas & water debths over 300 feet and also they are talking about 104 gas which is the oldest gas that we have and some of it selling for as low as $.20 a thousand which is just incredible that that gas is being absolutely wasted at $.20 a thousand in some cases. I think that what's happening is that administratively we are starting to see some things happen and I think to see that fragmented into commerce & interior that it may really slow that process down.

Question: What do you see in the automobile industry and the housing where most of the unemployment is found?

Answer: There has got to be some changes in the interest rates for housing to get going and it is impossible to, get those interest rates back down unless we are going to let inflation take over again, or can get the deficit under control, because right now the government is sopping up all available cash. In the capital markets they are taking everything away to finance the government, so interest rates are causing us trouble so housing to me has got to have reduction. As far as the automobile industry is concerned Ross Perot, who heads the drug program for the State of Texas, (he is another of those volunteers as some people call him) founded DDS and is a double though guy and is pretty military and scares anybody that is in the drug business. I was with him six months ago and he said that he thinks that the biggest problem that General Motors has today very simply is all the marijuana butts on the floor of the assembly line. He said we have good solid information that one marijuana cigarette reduces your efficiency by over 25%. Until General Motors and automobile unions can get things in order and get these people headed in the right direction they are going to play some. tough competition with the Japanese. The Japanese feel privileged to work someplace and you have alot of people in General Motors that don't consider it a privilege. They feel like their total committment and loyalty is to the union and not the company. And that has got to be changed if you are going to continue to compete with some of these other automobile makers.

Thank You.