I understand that you have prepared a statement for the Japanese people that perhaps you would like to make right now. Please, Mr. President.

The President. Well, thank you very much. And may I say how delighted Nancy and I are to be back in Japan. The last time we visited Japan was 1978 at the invitation of one of your Diet Members, Shintaro Ishihara. I was also here in 1971, when I had the pleasure of seeing Kyoto, your beautiful, ancient capital city.

There is so much in Japan's history and culture that impresses us. Americans are full of admiration for the Japanese people, the warmth of your ways, your spirit of initiative and teamwork, and your strong traditions of devotion to family, education, and progress.

You have brought great development and prosperity to your country. We know that the struggle for better living was often difficult in earlier days. But endurance, tenacity, and sheer hard work -- qualities which I understand are beautifully portrayed in your popular TV drama, ``Oshin'' -- have brought your nation great economic success.

Recently I received a letter from Masayasu Okumura, principal of the Nishisawa School in Akita Prefecture, which I understand is very far from Tokyo. Mr. Okumura invited Nancy and me to visit his country school and his 27 students. Mr. Okumura, I wanted to drop in on your school and talk with your students, but our stay in Japan this week has been too short. We wish we had time to meet more people and see more of your beautiful country, including such places as Kyoto, Hokkaido, Hiroshima, Nara, and Nagasaki.

But we depart tomorrow, confident that our relations are strong and good. As I have said to the Diet today, we may live thousands of miles apart, but we're neighbors, friends, and partners, bound by a community of interests and shared values. Michitaro Matsusaki, one of Japan's earlier diplomats, said to Commodore Perry in 1854 what millions of us feel today: Japan and America, all the same heart.

Our countries enjoy great prosperity. We live in free and open societies. But much of the world lives in poverty, dominated by dictators unwilling to let people live in peace and freedom. That's why our relationship is so important. Japan and America shoulder global responsibilities, but with every responsibility comes opportunity.

We can share with the world our secrets of economic growth and human progress. We can offer the sunlight of democracy to people everywhere who dream of escaping the darkness of tyranny to decide their own destinies.

Japan and America are nations of the future, builders of tomorrow, and together we can build a brighter tomorrow. We can make this world a much safer, more secure, and prosperous place. I know with all my heart that if we have faith to believe in each other, to trust in the talent and goodness of the hard-working people in our great cities and small towns, then, yes, we will make our partnership grow, and together there is nothing Japan and America cannot do.

And now, I'd be delighted to answer some questions that you may have for me.

The President's Hobbies

Q. Thank you very much, Mr. President.

Q. Mr. President, listening to your statement, like many other people I find that you are indeed a great communicator. I say this not because you said very kind words about our famous city of drama, but because I think that your personal style on television is more relaxed and informal than that of many other politicians. That is why, with your approval, Mr. President, I would like to conduct this interview in a very informal way so that the Japanese people can get a clearer view of your personality.

Since your arrival, Mr. President, Japanese people have been following very closely your visit. And yesterday we saw that you enjoyed a lot about our demonstration of Yabusame at Meiji Shrine. What did you think of that typical traditional Japanese sport? And if I may ask, apart from horse riding, what are your personal hobbies, Mr. President?

The President. Well, horseback riding is certainly one, and all the things that go with having a ranch. I do a lot of the work whenever I have the opportunity to get there that has to be done around a ranch. As a matter of fact, just this summer we had a number of days at the ranch, and I managed to build, with the help of two friends, build about 400 more feet of fence that we built out of telephone poles. [Laughter] And it can get a little back breaking, but I enjoy that.

Someone once asked me when I was ever going to have the ranch finished, and I said I hope never, because I enjoy that. But there are other things, of course. I enjoy reading. I enjoy athletics of other kinds. And now, thanks to the generosity of your Prime Minister since his last visit there -- while I don't get to play golf very often, I will now be playing it with a brand new set of golf clubs which he presented to me.

Views on Visit to Japan

Q. Well, you have now completed almost all the events of your very full schedule for Japan. Yesterday you gave us your official view of the visit, but I wonder if you could give us now a more personal view of this visit?

The President. Well, yes, I'm very pleased with what has taken place here. First of all the warmth of the reception from all your people, and I mean not just the people of diplomacy and government that I had dealings with, but your people there on the streets and their showing of hospitality and friendship has been very heartwarming. But I have always believed that we only get in trouble when we're talking about each other instead of to each other. And since we've had an opportunity here to not only speak with your Diet but then to meet with your Prime Minister and others -- and, of course, I have been greatly honored to have been received by His Imperial Majesty, your Emperor -- I think that we have established a human kind of bond, not just one that is framed in diplomacy, but an understanding of each other as people. And I think that the world needs more of this.

Q. Mr. President, I would like you to know, in the first place, that many of my compatriots will be surprised and very happily so at the inclusion of Hiroshima and Nagasaki on the list of the places that you'd like to visit or you wish you could visit. And to this end, of course, you'll have to be a young -- [inaudible] -- sagacious man so that you'll be able to fulfill your and our common desire in this regard. Now, are you going to be one? Are you going to be a sagacious man?

The President. Well, I'm certainly going to try. This is too dangerous a world to just be careless with words or deeds. And if ever there was a need for the world to work toward peace and to work out of the dangerous situation that we're in, that time is now.

East-West Relations

Q. On a more, a little more serious note, Mr. President, my question is exactly related to this point. And that is, because of the experience that we in Japan went through, we are very genuine in hoping even for a very minimum, limited progress in the arms control talks which are currently underway. And just as it took another Republican President with very conservative credentials to effect a rapprochement very successfully with China, there are Japanese who hope that, perhaps, your hard-line policy may lead to the relaxation of East-West tensions. And in light of these hopes and expectations, Mr. President, could you comment on these talks? And, also, I would appreciate it a great deal if you would give us your assessment of the current state of and, perhaps, future prospects for U.S.-Soviet relations, particularly in the arms control area.

The President. Well, now, if all of your question -- you prefaced it with remarks about the People's Republic of China. Yes, we're working very hard to improve relations there and establish trust and friendship. And I think we've made great progress. I know there is a question that is raised sometimes with regard to our friends on Taiwan -- the Republic of China. And I have to say, there, that I have repeatedly said to the leaders of the People's Republic of China that they must understand that we will not throw over one friend in order to make another. And I would think that that would be reassuring to them, that they, then, might not be thrown over at some time in the future.

U.S.-Soviet Relations

But with regard to the Soviet Union -- and you mentioned my hard line. And that is -- I know I'm described that way a great deal. [Laughter] What is being called a hard line, I think, is realism. I had some experience with Communists -- not of the Soviet kind, but domestic, in our own country, some years ago when I was president of a labor union there.

And I feel that we have to be realistic with the Soviet Union. It is not good for us, as some in the past have, to think, well, they're just like us and surely we can appeal to, say, their kindliness or their better nature. No. I think they're very materialistic. They're very realistic. They have some aggressive and expansionist aims in the world. And I believe that, yes, you can negotiate with them; yes, you can talk to them. But it must be on the basis of recognizing them as the way they are and then presenting the proposals in such a way that they can see that it is to their advantage to be less hostile in the world and to try and get along with the rest of the nations of the world. And if this is hard-line, then I'm hard-line.

But it is important because of, also, your opening remarks with reference to the great nuclear forces in the world. We are going to stay at that negotiating table. We won't walk away from it. We're going to stay there trying, not as we have in the past to set some limits or ceilings on how many more missiles would be built, how much more growth they could take in those weapons, we want a reduction in the numbers. But really and practically, when we start down that road, and if we can get cooperation from them in reducing them, we should then continue down that road to their total elimination.

Many years ago, after he became President, Dwight Eisenhower, as President, wrote a letter to a noted publisher in our country. And he said in that letter that we had to face the fact that weapons were being developed in which we could no longer see a war that would end in victory or defeat as we had always known it. But the weapons were such that it would end in the destruction of human kind. And, as he said, when we reach that moment, then let us have the intelligence to sit down at a table and negotiate our problems before we destroy the world.

I see it also in another way that he didn't mention. Once upon a time, we had rules of warfare. War is an ugly thing, but we had rules in which we made sure that soldiers fought soldiers, but they did not victimize civilians. That was civilized. Today we've lost something of civilization in that the very weapons we're talking about are designed to destroy civilians by the millions. And let us at least get back to where we once were -- that if we talk war at all, we talk it in a way in which there could be victory or defeat and in which civilians have some measure of protection.

Q. Thank you very much, Mr. President.

Arms Control and Reduction

Q. Mr. President, you referred to the current situation as being very dangerous. And in recent months we have witnessed one act of violence after another -- the assassination of Mr. Aquino in the Philippines, and the shooting down of the Korean Airlines passenger jet, the terrorist bombing in Rangoon, and again in the bombing in Lebanon, Beirut, and the regional conflicts that persist at many different parts of the world, including the Middle East and the Caribbean. I think we certainly live in a very dangerous world, and your administration has advocated very strongly for building more effective defense capabilities of the United States and of its allies.

Now my question is, Mr. President, my question is that the kind of danger that the world faces today would be minimized if the United States and its partners, including Japan, become stronger militarily?

The President. Yes, and this is part of that realism that I meant. I once did a lot of negotiating across a table as a labor leader on behalf of a union, and I think I know and understand the give and take of negotiations. But for a number of years now, recently, we have sat at the table in meetings with the Soviet leaders who have engaged in the biggest military buildup in the history of mankind. And they sat on their side of the table looking at us and knowing that unilaterally we were disarming without getting anything in return. They didn't have to give up anything. They saw themselves get stronger in relation to all of us as we, ourselves, made ourselves weaker.

I think realistically to negotiate arms reductions they have to see that there is a choice. Either they join in those arms reductions, or they then have to face the fact that we are going to turn our industrial might to building the strength that would be needed to deter them from ever starting a war.

Wars don't start because a nation is -- they don't start them when they are weak; they start them when they think they're stronger than someone else. And it is very dangerous to let them see that they have a great margin of superiority over the rest of us. There's nothing to prevent them from then becoming aggressive and starting a war.

Now, if they know that they cannot match us -- and when I say us, I mean our allies and Japan and the United States -- they cannot match us if we are determined to build up our defenses. So they then face the fact that as we build them up, they might then find themselves weaker than we are.

It was all summed up in a cartoon in one of our papers. This was before the death of Leonid Brezhnev. Brezhnev was portrayed talking to a Russian general, and he was saying to the general, ``I liked the arms race better when we were the only ones in it.'' [Laughter]

Q. Let me just follow up my question. Some of the dangers that I refer to do not take place only in the context of the confrontation between the United States and the Soviet Union. I think some of the regional conflicts have indigenous roots for that. And I just wonder if we are not having the kind of crises and dangers that don't lend themselves to the military solutions, which might call for some other approach to solving these problems and thereby reducing the tension in the world as a whole.

The President. Well, if I understand your question correctly, what we're talking about is -- you mentioned the Middle East. Once upon a time, nations like our own with oceans around us, we could have a defensive army on our own land, we could have coastal artillery batteries, and we knew that if a war came to us, it would come to our shores and we would defend our shores. Today there are strategic points in various places in the world. The Middle East is one. Could the allies, Western Europe, could Japan stand by and see the Middle East come into the hands of someone who would deny the oil of the Middle East to the industrialized world? Could we see that energy supply shut off without knowing that it would bring absolute ruin to our countries?

There are other areas. More than half of the minerals that the United States needs for its own industries comes from spots all over the world. Well, an aggressor nation, a nation that maybe has designs on other nations, recognizes that also. We have to look and see where are those strategic spots which we cannot afford to let fall.

With the problem of Cuba in the Mediterranean -- in the Caribbean, we have to recognize that more than half of all of our shipping of those necessities we must have come through the Caribbean. It wasn't an accident that back in the First World War that the German submarine packs took up their places there. We know that the strategic waterways of the world -- the Soviet Union has now built up the greatest navy in the world, and the biggest part of that navy is here in the Pacific, in the vicinity of your own country. But they know, as anyone must know in world strategy, that there are a limited number of choke points, sea passages that are essential to your livelihood and to ours. You can start with the Panama Canal and the Suez Canal, but then the Straits of Gibraltar, but then right here in the passages that lead to your own island, the Malacca and the Makassar Straits. There are a total of no more than 16 in the whole world. And a nation that could dominate those narrow passages and shut them off to our shipping could secure victory without firing a shot at any of us.

The American Economy

Q. Let us turn to an economic issue.

Q. Mr. President, the American economy has been rapidly improving, we hear, yet unemployment is still high. Could you tell us what you believe will happen to the American domestic economy in the coming year and whether the improvement of the American economy, domestic economy will help to resolve remaining trade problems between the United States and Japan?

The President. Well, the American economy is improving. This recession that we've just been going through is the eighth that we've known in the last 40 or so years. And each time in the past our government has resorted to what I call a quick fix. It has artificially stimulated the money supply; it has stimulated government spending, increased taxes on the people which reduced their incentive to produce. And yes, there would be seeming recovery from the recession which would last about 2 or 3 years because it was artificial, and then we would be into another recession. And each time the recession was deeper and worse than the one before.

Well, we embarked on an economic program that was based on reducing government spending to leave a greater share of the earnings of the people in the hands of the people. We not only reduced the spending, we reduced taxes. And it was set out to be a lasting and real recovery.

When we started in 1981 our recession was about -- roughly 12\1/2\ percent. People were saying that it couldn't be eliminated in less than 10 years. Our interest rates were more than double what they are now. Our program, once put into effect, and as the tax cuts did have the effect we hoped they would have on the ability of people to purchase but also the incentive of their being allowed to keep more of the money they earned -- the inflation for the last year has been running at about 2\1/2\ percent or so, down from the 12.4. The interest rates, as I said, have been halved. We have a long way to go. The last thing to recover will be unemployment. But even there, last month our unemployment dropped to a rate that in our own optimistic predictions we had said would not happen until the end of 1984. And here it is in 1983, down to what we'd predicted that far ahead.

We've come down from a very high unemployment rate to 8.7 percent. And I think that we're on the road to a solid recovery. I'll tell you, when our political opponents were claiming that our plan wouldn't work, they named it Reaganomics. [Laughter] And lately, they haven't been calling it Reaganomics anymore. I assume, because it's working. [Laughter]

But what it will do for the rest of the world and our own relationship, I think that our country -- I think your country, largely -- certainly between the two of us, we do affect the world's economy. The world has been in recession. And I think that the United States and Japan and, certainly, with us together, we can help bring back and bring out of recession the rest of the industrial world.

Trade With Japan

Q. Mr. President, you said that -- in the National Diet this morning -- that you have vigorously opposed the quick fix of protectionism in America. But there remains the danger of protectionist legislation to restrict Japanese imports to the United States. Do you believe such anticompetitive legislation will be passed? And in regard to this, what do you think of the steps which Japan has been taking to further open up its own markets?

The President. We heartily approve. And one of the things that we've been discussing are some of the points of difference that still remain between our two marketplaces. And I have pointed to the danger of those in our Congress who, because of the unemployment, think the answer could be protectionism. Well, I think that protectionism destroys everything we want. I believe in free trade and fair trade. And yet, the pressure on them as legislators to adopt these bills, these measures -- I am opposed to them -- and yet, as I say, I know they're under that pressure. And they're tempted. And they're talking of this. There probably have been 40 bills that have been brought up and proposed, all of which would have some elements in them of protectionism.

But as I described it in the speech to the Diet this morning, protectionism is -- that's the case of one fellow shooting a hole in the bottom of the boat, and then the other fellow answers by shooting another hole in the boat. Well, you don't get well; you get wet. And I don't want us to start shooting holes in the bottom of the boat.

U.S.-Japan Cultural Exchanges

Q. Well, Mr. President, unfortunately time is running out. And that will be our last question.

I understand you have a strong interest in increasing personal contacts between the Japanese and the Americans.

The President. Yes.

Q. Do you have any idea, specific idea how this could be accomplished?

The President. Well, yes. I think we can increase our student exchange. Almost 14,000 of your fine young people are in our country now. We would like to see more of ours coming here. There is talk now of the Association of Japanese and American Businessmen in using private funds, having an American House in Tokyo as we have a Japanese House in New York, both designed for more cultural exchange, more things such as student exchange and all. And I believe, again, that's another example of people talking to each other instead of about each other.

Q. Well, Mr. President, I'm awfully sorry, but that's all the time we had. And I thank you very much on behalf of all these participants.

The President. Well, thank all of you for the opportunity. I'm sorry the time went by so fast. Maybe my answers were too long. [Laughter]

Note: The interview began at 6:22 p.m. in the Shairan-No-Ma Room at the Akasaka Palace.