Bill Moyers Journal; 511; A Texas Notebook

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Bill Moyers' Journal

"A Texas Notebook”

April 10, 1980

JIM NUGENT: Now I do not believe anything I hear him say. I've seen him lie and misrepresent so much that I prefer to check it and deal with facts.

BILL MOYERS [off camera]: He's called you an agitator.

JIM HIGHTOWER: I am an agitator. That's what I told the press right back. Agitator's that centerpost in a washing machine that gets the dirt out and that's what I'm gonna do in my campaign.

Prof. CLIFTON GRUBBS: Dr. Grubbs pollution, atomic warfare, population explosion, alienation. Can't handle it. I said, ‘No, get up, get up, boy, get a shave, get a bath. Go to the library and write me an essay on the fourteenth century. I want to know all about the Black Plague and the Hundred Years War and stop feeling sorry for yourself. This world owes you absolutely nothing, son.'

MOYERS: From deep in the heart of Texas, we have two reports in this hour, both I think with national interest. One is about politics and energy, and the importance in this election year of paying attention to candidates in your own backyard. And the other is about the possibility of an economic ‘Apocalypse Now,' according to a volcanic professor named Clifton Madison Grubbs.

I'm Bill Moyers.

MOYERS: When I was a youngster in Texas, thinking about a career in politics, the editor of an iconoclastic weekly newspaper said to me, 'If you want to be a real power in this state, boy, try to get a seat on the Texas Railroad Commission.' The Railroad Commission was an American forerunner of OPEC, controlling the rate of flow of price of the oil and gas which powered this country's postwar prosperity. Some of the men now running OPEC in the Persian Gulf and South America were in training in those days at the Commission's offices in the capital city of Austin. Our first report is about the race this year for one of the three seats on the Commission a race between the incumbent, Jim Nugent, and the challenger, Jim Hightower. It's an important story in its own right and because it reminds us that our preoccupation with Presidential politics in 1980 should not blind us to all those other races in each of the fifty states that may effect our lives as much and even more than the contest for the White House. Politics Texas Style begins the way all politics begins. With someone who holds an office and someone else who wants it.

Politics Texas Style

HIGHTOWER: He owned stock in Exxon and Southern Union Gas and the Southern and Pacific Railroad. Dozens of other companies that he now says he regulates. Now Nugent says 'don't worry about that cause I got shares of that -corporate ties. I gave some of that stock to my wife, and I gave some to my daughter and we put some in a blind trust and we even sold some of those stocks. I'm no longer a corporate man.' Well, I'll just tell you a snake story. I grew up in Grayson County, up in the farming area, and I had uncles who'd take me out in the springtime around the stock tanks. And there would be snakeskins laying on the ground where the snakes in springtime had shed their skins. Just as Nugent has shed his corporate ties. But I had an uncle always warn me, don't be fooled. Cause back over there in the woods there's still a snake somewhere.

NUGENT: I think of him as, oh, perhaps a left wing radical. He's perhaps as radical in the statements and viewpoints that I've heard him express of anybody I've seen on the political scene in years.

HIGHTOWER: I'll tell you what's radical is rising people's utility rates by 300% in the last ten years. And then doubling that by these add-on costs. That's radical. He ought to go out there and talk to some of the senior citizens in this state. He ought to go talk to the farmers who've had oil spilled on their land and his commission won't go do anything about it. He ought to go talk to some of those independent truckers who can't get a permit, can't get into the free enterprise system cause they won't give 'em a permit. He ought to go talk to them. They think he's radical.

NUGENT: Well, he wants the office that I presently hold and he wants to throw up as many stories and as much smoke screen as he can and he's not inhibited by the truth and he's doing his best to get himself elected.

MOYERS: This building in Austin, Texas is headquarters for the Texas Railroad Commission. Don't let the name fool you. It has little to do with trains. The Texas Railroad Commission is one of the most important powerful regulatory agencies in America. It regulates the production of every oil and gas well in Texas, and that's a bunch. It regulates strip mining, and Texas sits on some of the largest reserves in the nation of coal and lignite. It regulates gas utility rates. And it regulates intrastate truck and railroad rates. That's no small agenda. And it makes the three men who sit on that Commission more powerful in ways than governors and Senators. Usually, the establishment in most of whom don't know what the Texas decides who's going to sit on the Railroad Commission and voters Commission actually does ratify the choice of the powers that be.

MOYERS: This year someone has upset the apple cart or, more aptly, perhaps, thrown a switch that threatens to derail the way Texans run their Railroad Commission.

MOYERS [to Hightower]: Why do you want in that building?

HIGHTOWER: Because this is the office that has more power than any other office in the State of Texas to help people.

MOYERS:One source of that power is the Lone Star state's history of oil and politics. Since the 1850s, they've drilled over 600,000 wells down here. Production has recently been declining, but Texas still pumps more oil than any state in the Union — nearly a billion barrels last year. And in the decades ahead, by one estimate, Texas will provide the United States with one-third of our energy. It's so rich in reserves that for years excess natural gas was burned off, flared, just to get rid of it. When I was growing up in East Texas we were taught that the first rule of arithmetic is one plus one equals two, while the first rule of politics is oil plus gas equals a majority in Austin. It's a the Texas Railroad formidable complex of power. So formidable, say critics, that the agency which regulates it Commission- has become instead a servant of it. But this year the power of the establishment has a challenger.

HIGHTOWER [at the podium]: I am Jim Hightower. I was originally from Grayson County up in Dennison, Texas. Went to school at North Texas State University. Worked three years as legislative assistant to Ralph Yarborough when he was United States Senator in Washington. Have been editor of the Texas Observer for the last three years. And it was as editor of this statewide publication that I began to look at this little office called the Texas Railroad Commission and begin to understand that it is the most powerful office that we have in Texas. But what I'm trying to do is to rally what I call the 'gougees' of the State of Texas. Those of use who pay the bills. We have not in my lifetime had a consumer advocate on the Texas Railroad Commission. Not one. Yet we're the majority — the working people, the family farmers, small business people, poor people, old people · we're the majority. Yet we don't have a single voice. Today I got the endorsement of the State AFL-CIO. On Friday I expect to get the endorsement of the United Auto Workers who are meeting. I've had the endorsement the support of the leadership of the Texas Farmers Union and of the American Agriculture Movement. I'll get the support of the Mexican- American Democrats who will be endorsing on March 15th. I'm the candidate of those of you who don't own an oil well. And I'm the candidate of those of you who feel gouged. And you're the ones I want to represent. I'm taking not a dime from the companies I would regulate.

“Jim Hightower, he's a good 'ole boy..."] RADIO ANNOUNCER [on the car radio]: We're pleased to have with us in our KTEA studios Mr. Jim Hightower, Democrat for Texas Railroad Commissioner. Jim, what do you think qualifies you to be Texas Railroad Com- missioner?

HIGHTOWER: Well, what qualifies me is that for the first time an outsider will be on the inside. This Commission is owned by the companies it's supposed to be regulating.

RADIO ANNOUNCER: You kind of consider yourself in other words a consumer advocate for the people on the Board.

HIGHTOWER: That's exactly what I will be.

RADIO ANNOUNCER: You're not gonna run from the back of a railroad, are you?

HIGHTOWER: No, I'm not gonna do it.

RADIO ANNOUNCER: Okay, Jim Hightower. Thank you very much. We appreciate your visiting with us today.

HIGHTOWER: Thank you. Appreciate this chance.

RADIO ANNOUNCER: All right, sir.

[Jim Nugent political commercial]

NARRATOR: Since Jim Nugent has been our Texas Railroad Commissioner, he's built a record of fighting to assure adequate supplies of energy for all Texans, while demanding that energy prices be held as low as possible for consumers. Jim Nugent almost twenty years of service to Texans. A family man who has a deep commitment to the future of our state. A man who does his homework, then fights for the rights of all Texans. In the May 3rd Democratic primary, let's vote to return Jim Nugent a Railroad Commissioner for Texans.

MOYERS: What's at stake in this campaign, Mr. Commissioner? Your opponent says the real issue is economic democracy — whether or not the people are getting a fair shake?

NUGENT: There have been so many statements made by him that were directly opposite the truth of the facts that are relatively easy to look up that I've just quit trying to answer any of his accusations and gone about running my own campaign. I have a graduate degree in engineering. I got a BSME from the University of Texas. I also went to A&M for a while. I worked in industry. I have a law degree. I've practiced law for thirty years in a small West Texas town. And I served in the Legislature for eighteen years. I was Speaker Pro Tem in the House of Representatives when I resigned and took this job. I have the engineering background, the legal background and the political background, all of which I think are essential and a part of the qualifications for acting as a Commissioner.

MOYERS: When I was growing up, the oil companies in Texas were heroes. Now they're the scapegoats. How do you account for that?

NUGENT: I don't really know how to account for that. As you know, I've been on the Railroad Commission just a little over a year. I have noticed that the press does make them a scapegoat. And it's somewhat hard to determine except that everybody is pinched by the energy shortage. Everybody's pinched by the increasing prices. And I think they're the most readily available target.

MOYERS: Do you think that the Railroad Commission has become a scapegoat in this present campaign?

NUGENT: Oh, I doubt that. I don't think that there's enough interest in the race at the present time for there to be a scapegoat attached to the Commission.

MOYERS: What about the charge that the Commissioners operate by rules that are stacked against the consumers with the result that only industry representatives are allowed into the

process?

NUGENT: That is not correct. We have cities, we have individuals, we have all sorts who take part in our process. As I told you, the hearings examiner is actually a court downstairs. And parties can appear on either side as they would in a normal courtroom under reasonable laws of evidence and present their case and have them ruled on. So we do have an immediate involvement in the citizens of the State of Texas at this time.

[Interior, Texas Railroad Commission chambers]

VOICE: First item on the agenda will be docket 1877 presented by Jim Klute.

KLUTE: There have been wells drilled at regular locations on this lease that have been dry holes. They ask for this permit to prevent confiscation to an offset lease which has already produced 1.15 million barrels. It's my recommendation that this permit be granted.

COMMISSIONER Is there objection?

NUGENT: This grant would be the same distance from the leaseline as the two that have already been drilled?

KLUTE: Yes, sir.

NUGENT: I have no objection.

MOYERS]: To understand why the three members of the Texas Railroad Commission are so powerful, you need only drop by any Monday they're conducting public business. They decide how much oil and gas can be pumped out of any well in Texas. How much will be used, how much conserved. They act on pollution standards. Regulate the use of oil and gas pipelines. Arbitrate disputes over natural gas utility rates. And, in scores of decisions, affect ordinary citizens all across the board. Small wonder that the powers that be in Texas have always sought to influence the choice of Commissioners. It's done Texas style. Although Commissioners are elected, retiring members almost always resign before the election so that the Governor appoints a successor who will have the head start as running as an incumbent.

MOYERS: Why do they call it the Railroad Commission?

HIGHTOWER: Because they want to hide it. It's a name that confuses people. If you call it the Railroad Commission, people don't know that it regulates their utility bills. In fact, there was a piece of legislation in the last session of the Legislation here in Texas to change the name to the Energy and Transportation Commission of Texas and the three incumbent commissioners went up there and lobbied against that bill and killed it in the committee.

MOYERS: Why?

HIGHTOWER: Because they want to hide behind the name. They don't want the people to know. Their ability to get elected is based on their anonymity. That people don't know what the Commission is and they don't know who they are.

MOYERS: I've heard you in the course of several speeches refer to yourself as a 'populist.' What is a populist?

HIGHTOWER: That's a I think it's a distrust of concentration of power. It's like my daddy up in Dennison, Texas would say, if too few people get all the money and power in their hands, they're gonna use that against the rest of us. And our experience has shown that that's true.

MOYERS: Are you anti business?

HIGHTOWER: No, not a bit. In fact I'm for more business than most of these conglomerates are for. I want real competition. I come from a small business family and that's what I believe in. I believe competition will work. I want competition in the energy industry.

HIGHTOWER: I been, as you know, running a grass roots campaign around Texas. I've just come back from Runnels County where I went to see first hand some of the abuses that farmers in those areas and ranchers are suffering because the Railroad Commission will not take action against oil companies out there. Hundreds of acres of pasture and farmland are being ruined by oil leaks from the Soco Gathering System and by saltwater leaks from Exxon injection wells. More than 100,000 barrels of oil flowed in two to three weeks out of this pipeline leak. This is water from that underground water table. It is oil. There's nothing there but oil. This is a rag that we dipped in it yesterday in front of television cameras out there to show that in fact the oil is quite abundant in there. There are towns and small towns in Gaines County that have had their underground water supply so polluted by exactly this type of oil company pollution that they now have had to give up their underground water supply and switched to bottled water in the area. The Railroad Commissioners are hidden over here in this building. They don't get out among the people. They don't know about these things. And the reason that they don't is because they have direct conflicts of interest. These are the kind of ties that produce these kinds of results for the people of Texas.

[Interior, conference hall — meeting of the Texas A.FL.-C.I.O.]

NUGENT [at the podium]: If you want to know why your food, your rent, your clothing dollars don't buy what they used to, why the inflation rate is galloping along at 18% per year, and why foreign madmen can treat America as a joke, look only to oil imports and the dollars spent for them. These are the facts. Four years ago the Railroad Commission granted gas utilities 69% of the rates that they asked for. During my first year, we granted them only 35%. My opponent has tried to twist these figures into something they are not. He is wrong and I think the facts easily demonstrate it.

HIGHTOWER [at the podium]: He's been campaigning and he's here today. But you haven't seen him before today in your central labor halls. That's because he's been in the petroleum clubs in Houston and Dallas doing his campaigning. [applause] I need your help in these next eight or nine weeks. I reach out my hand to you. I look forward to winning with you on May the 3rd. Thank you very much. [standing ovation]

HIGHTOWER: That's what surprised Nugent, I know, about my campaign. I mean, he figured I was gonna get the beansprout eaters, and a narrow band of liberals and that's all I was gonna have. But I started my campaign with farmers and the building construction trade unions and the old yellow dog democrats of East Texas which is what I come out of.

NUGENT: Let me introduce myself. I'm Jim Nugent, Trade Railroad Commissioner. How are you, Prissy? John, nice to see you. You're not that senator from Jasper?

MOYERS: Jim Nugent flies his own plane across the vast precincts of Texas in pursuit of the voters. This day he stops to politic among oil and gas folk at the opening of a new pipeline built by one of Texas' wildcat producers, Clayton Williams.

NUGENT: I sure hope you all can see your way to help me in the politics. Get them votes out and get 'em to the polls.

OIL MAN: Well, when you came out to Midland I was with Ed Thompson and that bunch.

NUGENT [about a campaign pamphlet]: That sort of tells you the history of where I come from, what I'm doing, what I hope to accomplish, and where we might go.

OIL MAN: Absolutely, we're behind you 100%.

NUGENT: Well, as you get a chance, put a good word in.

WILLIAMS: We can move faster. And the main thing we have is adventurous wildcatter spirit. We're trying to make a buck. We're trying to find an oilfield. We're trying to get ahead. And we're like the pioneers, in a way. In fact, a wildcatter is a pioneer. We're explorers.

MOYERS: What's your answer to the charges that the people like you are making a lot of money out of the fact that the Arabs have sent the price of oil rocketing?

WILLIAMS: That's the system we live in. If somebody will pay $40 a barrel and I have it, I'll keep selling it to him at $40 until they won't buy it at $40. If they don't buy it at $40, I might sell it at $35 or whatever it takes until I quit drilling.

NUGENT: Good to see you.

OIL MAN: Feeling real good?

NUGENT: Yeah, if politicking ever goes good, it's going good for me, yeah.

OIL MAN: Nice to be with you.

WILLIAMS [at the podium]: I want to introduce one of our Railroad Commissioners to speak a few words to us. After he enlightens you with some of the things they're doing right and where they're correcting some of the things that were in the past wrong, we're gonna go over and we're actually gonna open this valve and this is not a show and you'll hear the valve open. I hope we can get it done. In the meantime, the Honorable Jim Nugent, Railroad Commissioner of Texas. Let's give him a hand. [Applause]

NUGENT [at the podium]: Thank you. It's a pleasure to be here with you all today. It's always a privilege for me to go somewhere where somebody's building and adding to this country and helping, and certainly this gas and oilfield here in Central Texas is one of the greatest things that's happened to the State of Texas and to y'all in particular. We want you to drill as many wells as you can. Build all the pipelines that you can. Get it to the surface so we can use it. And you can get the economic benefit from it. And there's one other thing I want. I'm running for re-election and when you come to the polls on May the 4th I'd appreciate your help.

NUGENT [joining them]: Are we supposed to get out here and help turn this damn thing?

]

MOYERS: Commissioner, I have to talk about money because your opponent keeps raising it in his speeches. Have you received any contributions from oilmen or oil lawyers?

NUGENT: I'm sure I have.

MOYERS: What do you think about that?

NUGENT: I've taken donations from any citizen in the state that wanted to participate in the political process.

MOYERS: Wouldn't it just simply be better, Mr. Commissioner, not to take any money who had anything to do with the Commission so as to avoid the charge of undue influence?

NUGENT: No, I don't think so. You see the minerals in the State of Texas are owned by the individual property owners. And at least an eighth to a quarter of all oil and gas in Texas is owned by individuals. Why should they be denied from participating in the political process?

MOYERS: I know that he has raised some money in Washington and New York. What do you think about raising money in places like Washington and New York for a campaign for the Railroad Commission in Texas?

NUGENT: Well, I think that's more of a conflict than the one you tried to raise for me in taking money for my race from citizens of Texas. I understand he's had two fundraisers in Washington, one in New York and some elsewhere up in New England. And I think for the people up there to contribute as heavily as some of his supporters say they have to a Texas race raises a serious question about whether he's gonna be representing the consumers in Texas or the consumers in the Northeast.

MOYERS: What about the specific allegation that Mr. Hightower has made that the 'state's private utilities are allowed the highest rate of return in the nation. At the same time Texas homeowners are saddled with the highest gas prices in the country?'

NUGENT [referring to notebook]: Well, let me give you the facts. Last year in 1979 the rate of return allowed gas utilities in the State of Texas on a fair value rate basis was 6.1%. If you will go to the listings of the average residential gas prices paid by all of the states in the United States you will find that the State of Texas is the 25th. It's average rate for a million btu's is $2.57.

MOYERS: Twenty-fifth out of 50?

NUGENT: Yes, sir.

HIGHTOWER: He's kind of like that six-foot man who tried to wade the creek that had an average depth of five feet and drowned in the process. There are rates being paid in Texas, including in this city, Austin, that are the highest in the country. See, he's just talking about the rates, too. This is the kind of trickery he gets into. It's not the basic rate. It's the add-on of the advertising charges, the retroactive rates that he sponsored, policy. The legal fees that they pass on. The fuel adjustment costs all of which about doubles our utility bill. So the ultimate bill that people are paying in Texas in many cities in this state are the highest that they are in the country. And the utilities are enjoying the highest rate of profit. Now, it's not just he plays another little game and this is a problem with this commission. They'll say, for example, Lone Star Gas is a utility and it needs a higher rate of return because we've looked at their books. The problem is they don't look at the parent corporation's books. Lone Star is owned by something called Insearch, and Insearch is enjoying, according to Business Week magazine, an extraordinary rate of profit, extraordinary rate of return on their investment. But these commissioners over here won't get into Insearch's books. They play a shell game. Hide that pea under Lone Star's shell without lifting up and looking under Insearch's shell.

MOYERS: He says he can't be bought by $16,000 contribution from the oil industry?

HIGHTOWER: We analyzed the latest filing that he made with the Secretary of State of his campaign contribution through his officeholder account. Every single contribution of $100 or more came from an individual or a company that is regulated by the Texas Railroad Commission. Every one of them. Secondly, it's not a question of whether he bought on a single vote. It's a question of the seat is bought by those companies. They put up the money to finance his campaign and they buy the seat. They never have to go ask him for a vote. 'Cause his views, his political and economic views are the same as those companies. So they don't ever have to go ask him. They've got his vote without asking.

[Interior, United Auto Workers meeting]

NUGENT: Let me tell you where we are. The real war that's going on in energy right now is one dealing with jobs. Jobs either in Texas or jobs in the northeastern part of the United States. And we got two candidates that represent different viewpoints here. I represent the Texas viewpoint. And I think I represent the Texas consumer. My campaign is being financed and it's being run in the State of Texas. My opponents campaign is being financed out of New York City and Washington and the northeastern part of the United States. Let me tell you why that's critical. You're paying more right here under the federal law for your average cost of natural gas than they pay in the northeastern part of the United States for Texas natural gas shipped up there. And you know what? The northeastern part of the United States has not allowed a well to be drilled up there in less than ten years of applications and lawsuits. They have not allowed a refinery to be built on the East Coast in fifteen to twenty years. They have preferred to use their vote, their money and their power to rig the rules and treat Texas as a colony. Take our natural resources at less than fair market value for their benefit and their factories and their jobs. And in my opinion they are now trying to buy themselves a seat on the Railroad Commission so they can further that transfer of our natural resources to the northeastern part of the United States. I was interested in being told yesterday that my opponent came before you and stated that when I went on the Railroad Commission I had an income of $38,000 a month from oil and gas and other interests. Now that poses a very personal problem for me right now. My wife has heard that also. And she inquired of me this morning- She inquired of me this morning why we were having to run a household on about $1000 a month when I had that kind of income and I had to set down and explain to her that in politics a fellow who's trying to get in an office will lie a little bit every now and then. I've never had $38,000 a month, or a year, income from oil and gas. I don't own any oil and gas. I have not owned any since the time I took this office. I sold what smallholdings I had so that there would be no conflict of interest when I became a railroad commissioner. SPEAKER [from the floor]: You referred to 50% of the oil coming in from OPEC and you said that the reason that our oil is going up is cause OPEC has raised the price. And you said our oil that belongs to us. Is us Shell, Texaco and the other major oil companies in this country? Is that who 'us' is?

NUGENT: No. Us is the citizens of the State of Texas. More than an eighth, and approaching a quarter of all oil and gas produced in Texas is owned by the individuals who own the land. It's not owned by the oil companies. It's not owned by the drillers or the wildcatters. It's owned by the property owners. And that's part of us.

SPEAKER: Any other questions for Mr. Nugent? Mr. Nugent, we appreciate your coming.

HIGHTOWER: What he's worried about is I'm getting money. Period. He knows I'm gonna run a serious campaign at him. He's been used to running name recognition that all the moneyed establishment has in Texas. Running big money campaigns against terribly underfinanced opponents. I'm able to go in Texas and out of Texas and raise money against him. First of all, there's always been out of state money in Texas races, including Railroad Commission races, and including Mr. Nugent's race. He's already taken money from out of state. Those people who come to my parties to give me $25, I can't do anything for them. I can't give them a drilling permit or a trucking permit or a stripmining permit. Or I can't raise their rates. What I can do is to try to fight for a better kind of government down here and provide some leadership down here that'll change the way all government works nationally. I can blaze a trail down here, I hope—

MOYERS: What do you mean by that?

HIGHTOWER: Well I want to show you can run against the moneyed establishment in a state like Texas. That's when you've got to give hot speeches. You can't turn them out if you don't turn them on and that's what I'm trying to do. Get them fired up and say to them, direct, 'here's where I stand.' The other side's not afraid to say where they stand. But our politicians, progressive sort of politicians in the state, have been scared for the last ten years. They say you've got to run moderate, sort of don't rock the boat campaigns. I don't believe that. I believe you plant the flag and go right at 'em.

[Interior, UAW meeting hall]

HIGHTOWER: Most of you already know the issues. But I'm saying to the people of Texas that you don't have to believe me and you certainly ought not to be believing him. All you got to do is look at one fact. And that is your monthly utility bill. How many of you had a 30% increase in your wages or your income even in a single year in the last ten years? None of you did. But the utility that you're paying your money to has gotten that from the Texas Railroad Commission. Gasoline prices are going to $2 a gallon. The Railroad Commission is siding with Exxon and Mobil and Gulf against our interests. I've got a campaign slogan I've been using that says 'enough is enough.' Enough of this. But it's better in Spanish. I got a poster here. In Spanish, ‘enough is enough' translates to yo basta. Stop it! [applause] It's like old Huey Long used to say, if you want ham, you got to get out in the smokehouse And we're gonna reach up there for one of the sweetest hams in Texas politics. The Railroad Commission. And we're gonna slice a third of it off. And we're gonna give that third to the people for a change. That's the chance that we got in 1980. I appreciate your help in this. The United Auto Workers have been very generous to me. I need more from you, though. And that's why I'm here today. I warn you, I'm coming back for more. I need some money from you. From your Union. I need your help back in your communities. I need some of those signs made. I need some word of mouth work done. We got to get a hard campaign going in this state cause we got a chance to do it. I need your own money. I want $5 from each of you. Or the price of a gallon of gasoline, whichever is higher. [applause] We've got to do this ourselves. They're not gonna finance it for us. That's what I'm going out to the people for. We're gonna plant the flag and let them know where we stand. We're gonna raise the issues. And where I stand is pretty clear. I'm saying to the people if you own some utility stock then Nugent is your boy. If you're an executive of the Exxon Corporation, then you get with my opponent 'cause he'll do your bidding. But if you don't own any utility stock, if you're not an executive sipping martinis up there in the suite at Exxon Headquarters, then you want to be voting for me. And if you're mad about your utility bill, if you're mad every time you pull up to the pump and fed up to here with that whole process, then you ought to try to sneak into that polling booth not once but vote for me twice if you can get away with it on May 3rd.

Thank you.

[Hightower, mingling with the crowd, beckoning with his hat for campaign contributions]

SPEAKER [from the podium]: I start it all by puttin' my five in.

HIGHTOWER: That's worth another trip to the podium. Single dollar bills. I'll take it myself. [laughs] Usually— People's money. I love it. Give five now, we get the prices down. [laughing] Here we go, friends. It's gettin' fuller and fuller. Thank you very much. Thank you Jesus.

[Exterior, Texas Railroad Commission]

MOYERS: If you win, you'll still be a minority on there, won't you?

HIGHTOWER: Well, I will. But the major difference is not the difference that I'll make inside. It's the difference that the constituency who elects me will make. For the first time not just oilmen are gonna go in that front door, Not just utility company lawyers. Not just executives of the major trucking companies of the state. But this building there. is gonna be surrounded by consumers, small business people, family farmers, old people, poor people, working people. For the first time they're gonna know what that is. And they're gonna hold not only me accountable but those other two turkeys, too, are gonna have to be responsive for the first time to this new constituency. And I think that's gonna be a very sobering thought to them when they make some decisions. So we're gonna win a few battles in there.

MOYERS: If he is a left wing radical, what do you think it would mean to the energy policies as they are affected by the Commission?

NUGENT: I don't even have to answer that. I don't think he's gonna win.

MOYERS: There's almost no major political issue from White House to State House that doesn't come down to economics. To the question of who gets what, how and at what price. Yet so inscrutable has that subject been made for most of us, that economics has been called 'the dismal science.' Well, I know of one place where it is not dismal in the classrooms of a certain professor at my alma mater, the University of Texas. While I was in Texas to report on politics, I stopped by for a refresher course in economics from Clifton Madison Grubbs.

CLIFTON MADISON GRUBBS [at the blackboard]: ...because people don't know what to do. So, extremely, high rates of inflation — the effective trade What you get down here on the bottom is social chaos. So, basically all you could talk about here would be something say on the order of six months. That's about all. Maybe seven months. Maybe eight months. Why? Why? Why? Why can't you have permanent wage and price controls? Because the American economy is too complex.

MOYERS: Cliff Grubbs is a third generation Texan educated at Harvard and the University of Texas, where he now directs the freshman economics program that teaches 9000 students a year. When the Danforth Foundation honored him with its National Teaching Award, one of eight awards that he's received for excellence in teaching, the citation called him a 'volcanic man, boiling underneath with concern for students.' We spent some time with Grubbs attending a lecture, walking around the campus with him, and interviewing him in the classroom where his students number over 500. When my wife and I were students here in the 50s, America was a land of bountiful promise, economics the study of plenty. Things have changed.

Cliff Grubbs, professor of economics and director of the freshman economics program that teaches 9,000 students a year at the University of Texas at Austin, has won more awards for teaching excellence than can here be recited.

GRUBBS [on the phone]: This is Cliff Grubbs, Director of Freshman Economics. Dean? It's Cliff. I want some of that red tape cut over there. I can't run this organization over here if I can't get ammunition over here and have to fight through all these damn forms. Well, no, no. I'm not mad. No. I'm sorry? All right.

MOYERS: What is the dilemma of teaching university students today about economics?

GRUBBS: The troubles, the frustrations, the disintegration of economic policy in the United States. The rate of inflation in the United States. The long-term question of petroleum in the United States. All this. All of the issues at least many of them the issues now troubling the American people come to focus in economics. They come to focus in economics. And it is increasingly difficult to teach into that.

MOYERS: Economists have been wrong so often in the last several years, how can students any longer take at face value what they read in the economics textbooks?

GRUBBS: Not too much. Not too much. Economists Take inflation, for example. Economists have no- There's no way to stop inflation in the United States. There's no way to stop it. With certain policies that we do not have right now, it can be controlled. But one of the problems that the economist has in the United States today is, the economists of the Joint Economic Committee in the Federal Reserve System, is that there's no such thing as an economic decision any more. Every decision made is economic and political and many of the things that economists would like for the federal government to do simply are not politically possible to be done. But part of the difficulty in the case of the economics profession has been a preoccupation with modelbuilding in the profession for the last twenty-five or thirty years. And the more distressing the times become, the stronger the fetal reaction becomes among the economic theorists particularly the mathematical economists to get back into the womb of the mathematical model - that you cleanse the model with mathematics. It's voodoo of a sort. To some extent, mathematical models in economics are dolls and adults play with them. And there has been a great deal of that in the profession of economics during the past twenty-five or thirty years. And the times have simply caught up with it.

GRUBBS [to his students]: The threat of wage and price controls produces inflation. And this is why you have the curious situation today of the President of the United States writing letters to corporations saying, 'we don't propose to do it.' Well, they may have to do it.

GRUBBS: A few weeks ago, there was a prediction that came out of the Joint Economic Committee that if now you would cut taxes by $11 billion and federal spending by $11 billion simultaneously, now in 1980, that by 1989 the inflation rate would be down 4 points. That is not even fifth rate astrology. That is embarrassing. Just imagine it, now. Nine years down the line. Here comes this 4% solution. It's sort of like Philo's little angels sailing through Pythagorean space lighting nine years down the line. That is embarrassing. To what level of mediocrity is it proposed that my profession descend? I would very much wish that my profession would cease and desist on predictions of that nature. They're foolish.

[Interior, Grubbs' classroom]

GRUBBS: Direct credit controls. Why aren't they used? One reason they are not used is because they are mean. They work. [laughs] They work. If we want to cut down on consumer spending, why in God's name do it by driving the rate of interest up to 20%?

GRUBBS: The story of capitalism has always been for the past 150 years putting the goods on line. The reason why capitalism didn't succumb to the arguments of Marxists is because it delivered the goods. Capitalism produced, and how productivity, technology, substitution of human power by machine power. And at any given time if any difficulty came along we'd call upon the machines, we'd call upon the technology, more productivity, pushing more and more and more. It just won't work. It won't work. The energy is not out there. This society here, this great society. I don't know- 5, 6% of the population of this globe using maybe a third of its energy. That can't continue. That's going to be taken away. A large part of it is going to be taken away. And it is not a question of the American people making sacrifices whether they care to make them or not. It's gonna be taken away from us.

MOYERS: How the devil then are we going to get through this wrenching experience?

GRUBBS: Well, one could respond to that by saying we're not. That's it.

MOYERS: But that what be unrealistic, because we do.

GRUBBS: We are going to come to it. One can―-

MOYERS: At what price? Bill of Rights?

GRUBBS: Well, this is the question. This is the haunting question. Let's go ahead and take the nightmare for a minute.

GRUBBS: Let's suppose that the Straits of Hormuz are shut. The big tankers sunk. Somebody puts up 50-caliber machine guns to stop the whole thing. It's only twenty miles wide in the channel. Suppose it's cut. Suppose that all foreign oil coming into the United States is interdicted. Suppose it is cut off. And let's just say permanently. Now what would happen? What would happen? We could operate the American economy on about 30% less oil than we are using right now and still keep going with civilization. But the consequence would be 30 months -30 months of social chaos and anarchy while you were trying to redirect the economy. Unemployment, God, I don't know. People blowing up supermarkets, ripping off package stores. People out of work. That's right, chaos. But I think we could get through it. I think that the economy could be restructured so that after about thirty months we could come out on the other side. Question, though, the deadly question, is what would be left of the Bill of Rights?

GRUBBS: Twenty-two, twenty-three million unemployed. Right? You would be facing terror, anarchy, riot. Certainly. But good god, that's not the death of a civilization. A civilization can endure an enormous amount of ruin. Your question, and it's the haunting one. If you draw the ultimate scenario, what we come down to, what we come down to is the Bill of Rights and also, in my own assessment of the situation, my nightmare racism.

MOYERS: That's what happened in Germany in the twenties.

GRUBBS: I don't think you can draw a parallel.

MOYERS: I know it-Not parallels. But when they hit their crunch, they didn't just survive. They didn't just make it. They didn't just come through it. They came through it at enormous human costs.

GRUBBS: Indeed. This is a deadly period. Let's look at some of the other deadly periods in the history of the world. Far more deadly than this. But it is a period that we are going through and it is not a question of what sacrifices were going to be made. It's just a question of how much is going to be taken away from us and how quickly is it going to be taken away from us.

GRUBBS: Fellow buys a washing machine and brings it home. You've stabbed the poor bastard, you've stabbed him maybe with 22, 23, 24% interest rate. Why? There would be another way to cut down on the buying of washing machines. Very simple. Very simple. Just simply say that when you buy it you're gonna have to put a large amount down on it. Say 20 or 25%. Also when you pay it out it has to be paid out say in eighteen months. That'll cut down on the purchases of washing machines. And automobiles. And television sets. And all sorts of appliances if that is what we want to do.

MOYERS: If I understand what you're saying, it's that we can't stop inflation because the political decisions necessary to do so would be too unpopular.

GRUBBS: It's not only just the unpopularity of the decisions. If one were resolved to stop inflation in the United States, let us say within the next eighteen months, if that were the only issue, would they do it? We could through monetary and fiscal policy induce a grave, serious, deep depression in the United States. Those things can be engineered nowadays. Suppose that we had one on the order of the magnitude of the 1930s with about 25% of the civilian labor force unemployed. That would stop inflation, but it would produce social insurrection. That's the issue of inflation. Inflation to some extent is a symptom of a departing value system. During the 30s- How could we get by with 25% unemployment during the 1930s? Because most of the people believed that the depression was caused by God. There was also a feeling a long feeling throughout history that the common man and woman can expect unemployment. It's the normal lot, the normal fate. That's no longer believed. Whenever you have a very serious depression you would rip off 25% of the people on the bottom. And the people on the bottom now won't tolerate it. They don't believe that God put them on the bottom, thank heavens. To the extent that the capitalism and older, older― Since capitalism's never had an inherent problem of inflation. And one of the reasons was simply that. That you would get into very deep recessions and depressions and it would bring the price level down. To some extent that's part of the issue now. But you can't use that now, because what is involved now is the very continuity of the western capitalist governments.

MOYERS [pointing to article]: You wrote a stirring essay which came to my attention recently called 'The Failure of the Great Society,' and you talk about some of the characteristics of Rome at the time of its decline. The growth of the massive democracy that slowly drained the life of the economy. A federal tax system that penalized incentive and institutionalized corruption. You talk about a welfare system that became a form of riot insurance in the cities. You talk about the ranks in the military being slowly filled by minority groups and the poor who had no economic stake in defending the older regime. Those sound hauntingly correspondent.

GRUBBS: Yes.

MOYERS: Even though you say there are differences between the Roman Empire and the United States in 1980---

GRUBBS: Vast.

MOYERS: —there are sufficient signs to cause you concern about the health and direction of our society. Is that correct?

GRUBBS: Oh yes. Oh yes. I think anyone would be a complete fool not to be alarmed about the present course of the United States. A complete fool. I think that any thinking man and woman is genuinely concerned about this culture. The only point that I would add is I do not think that there is any cause for a high requiem about the death of this culture. Certainly the future is deadly. Certainly it is deadly. But in the name of heaven why the requiem? Why the funeral music? I would rather argue that what you do is that you teach it just like you see it. But at the same time you don't convey the wholly inadmissible inference that the United States is finished. That the Western world is done. That is incurable nonsense. We have come to the end of an age in the West. For the first time in 700 years the Western world is no longer master of its own fate. And it comes home is a class like this. You do not have to teach or cultivate despair or cynicism. It is out there. You can cut it with a knife.

GRUBBS: Let me give you an example of what I mean. Oh, I guess it was a couple of years ago. I went over to the university bookstore. I don't know. To get something. And my god, there was one of my students lying on his side, sticking up a hand holding pencils, muttering some type of strange eastern incantation. I said, 'boy, what are you doing down there?' 'Oh, Dr. Grubbs' in this part of the country they call professors doctors 'Dr. Grubbs, pollution, atomic warfare, population explosion, alienation. Can't handle it.' I said, 'No, get up, boy, get up. Get a shave, get a bath. Go to the library and write me an essay on the fourteenth century. I want to know all about the Black Plague and the Hundred Years Wars, and stop feeling sorry for yourself. This world owes you absolutely nothing. son.' A couple of weeks later, he's in class. You cannot lend celebrity to self-indulgence. And this is what so much of it is indulgence- I have no patience with all of these sophisticated intellectual rot in this area which is so appealing to many academic types. I think there is a tendency among many very able eastern intellectual scholars to conclude that the world is what they see. It may not be- Let me give you an example of what a man— I've never met him - Robert Heilbroner — but I love him very much.

MOYERS: "Era of Limits." May- Is there hope for- He opens that book of his, 'is there hope for man?'

GRUBBS: "The Human Prospect." And he says, in effect, there is none.

MOYERS: But Heilbroner's thesis is based upon, you know, the lobster. The fact that a lobster when he gets into a trap doesn't know it's in a trap so it goes a little further, falls more into the trap, and the more it travels, the more entrapped it becomes. And his thesis is that we don't know we're in a trap. We're consuming our resources faster that we can find new ones. We are in an age of limits. Good night, you know when I was here in the fifties, it was a time of inexhaustible promise. There were no limits to anything. Now everybody's talking about limits. Where do you come out on that?

GRUBBS: I don't think they'll come through legislation. I think they will come through fits and starts of anger where you have a situation in Washington today where every day the Congress meets in an atmosphere of crisis. I think it will come. Ultimately, however, if you look down the line with it, what will bring us out of this certainly we must cut down on what we are using, and will. But to infer from all this 'it's finished'— that isn't true. We're going to go through some mean times. That's all. What was the high noon? What was the great achievement of the western peoples in world history? You begin to reflect on it for a minute. Western peoples have been no more creative than the Greeks were in their hour and time. They've been no more martial than the Romans. We are no more religious than the Arabs. Westerners are certainly no more reflective than the Buddhists. Westerners cannot endure more suffering than the Slavs. And, for that matter, Western people are no more curious than Babylonians, who began to chart the planets about 4000 years ago. What has distinguished the Western peoples in world history is that during the 17th century they invented more mathematics and science than had been invented during the entire preceding history of the human race. Certainly if we go on, and I would argue that we are going on, within the 21st century there will be a transformation a human transformation - on the order of magnitude of the emergence of civilization in the 4th millennium B.C., the world enlightenment of the 6th century B.C., and the Western scientific triumphs of the 17th century. These are the great hinges of history when human imagination was just projected into new dimensions and another one's coming.

MOYERS: If my daughter comes to the University of Texas next year and sits in your freshman economics class, what are you going to teach her as a survival for the '80s, the '90s?

GRUBBS: Over the course's four months, you slowly build a commitment to survival, a sort of toughness. 'Well, heavens above, things are going to be bad out there. I'm not going to have my car, my hi-fi set.' So what? So what? You slowly begin to talk that way. You cannot come right down on it. You have to piece it in with other things. And then, too. Then, too. There's a lot of Jehovah in my teaching. I don't mind telling people that I believe in a Supreme Being and it upsets them so much. I don't mind telling my students that I love the United States, and many of them are just profoundly upset by it. But, they'll have a guy in front of you, [sic] who does. Now, in teaching, you will succeed in it if you win the respect of your students. They will begin to listen to you. You can only do it if you give them every ounce of your energy when you walk into that room. It is all on the line.

MOYERS: I have a friend who, hearing that I was to call upon the provocative and controversial Dr. Grubbs, asked me seriously, 'would you really want your daughter to be taught by that man?' The answer is not only yes - I'd even like to be a freshman again myself. Cliff Grubbs wrote a short essay not long ago, the one I mentioned in the interview. It appeared in The Texas Observer and was titled The Failure of the Great Society. We'll attach it to the transcript of this hour.

I'm Bill Moyers. Good night.

APPENDIX

The failure of the great society

By Cliff Grubbs

Austin

Just when the decline of the great society passed the point of no return is difficult to say. Despair and hope; decay and revitalization these dialectical twins are always intimately interlaced during the closing years of a social epoch. Maybe if only a few important things had gone differently, the final outcome would have taken a somewhat different turn.

During its high noon the great society could boast one of the most powerful economic and military organizations the world had ever known. Its army was the best equipped in history. Its navies controlled the seas. And its average standard of living was for a time the highest in the world. There seemed to be nothing the great society could not do, no idea too bold to try, no technological project beyond the genius of its engineers.

How did it all come apart? What produced the failure of the great society? How did it happen?

Some writers believe the decline of the great society actually began with the growth of a massive bureacracy that slowly drained the life of the economy. Laws, regulations, price and wage controls- there seemed to be no end to it

- slowly strangled the economic colossus and produced a plague of administrators and lawyers.

Others have laid the blame on the federal tax system. They say that taxable economic production was penalized and that political corruption, malfeasance in high office, and tax evasion among the upper classes were institutionalized.

Conversely, it is also said that the tax burden on business activity began to choke the profit margin, the social engine of economic growth. The demands of the military, public works, the welfare system, and the massive bureaucracy itself eventually absorbed the lion's share of the national product.

Adopting a somewhat longer point of view, other writers say the older capitalist spirit was more gradually eroded by war, uncertainty, and a depletion of natural resources. Still others hold that the die was finally cast by runaway inflation and economic stagflation.

Of course, very strict wage and price controls were eventually imposed by the state, and much of the private sector was nationalized. But all that proved to be an economic failure. The farmers and the union members revolted and, in time, yet more severe measures were imposed by the state. Even the welfare system for the poor eventually became a form of riot insurance in the cities.

Of course, by this time the well-to-do had already abandoned the cities, building homes and villas in the suburbs where they dug swimming pools and surrounded themselves with consumer luxuries (and often guards).

Among the educated classes there was also a flight from public service, a retreat from responsibility and worry. Sensing the brief span of their own years and their personal inability to change the outcome, the educated, the gifted, and the hopeful gradually abandoned the sinking ship. So the incompetent, the lazy, and the uncivil servants began to swell the ranks of the bureaucracy.

Nor did the ranks of the once powerful military organization escape the widening disintegration of the older political order. Returning from lost or indecisive wars, the soldiers were no longer cheered as in older times; while the generals, facing enemies on every front, could not bring decisive power to bear at any point. The ranks of the military were slowly filled by minority groups and the poor who had no economic stake in defending the older regime. Meanwhile, outside the great society, testing the colossus, probing its national resolve, striking on one frontier and then another, the enemies of the great society slowly began to realize that it was rotting from within.

Not that the generals and the diplomats failed to do what they could abroad. Subsidies, bribes, and annual tributes were paid to strong men and petty rulers in ransom of their temporary favors. An older enemy was pitted against a newer one; alliances and pacts were formed; assassinations were planned. Every instrument of modern diplomacy was used. But none of it worked in the end.

The internal exhaustion of its natural resources; the revolt of its military clients and economic colonies: the spread of internal disorder and the murder of its own leaders all that over a course of years proved to be too much for the great society.

Maybe the big athletic games in the stadiums filled with cheering citizens were the last victories of the older patriotic order. Maybe what the older regime had lost in power it tried to relive through the games. However that may or may not be. the older creative elites were gone and the common person had no respect for their social counterfeit. An epoch was finished.

So, weary and disillusioned like the rest, uncertain about the future, and intellectually tired, many thinkers of the great society abandoned their older gods and turned toward a new Eastern religious cult teaching peace on earth and good will toward the barbarians. . .

This short sketch of the decline of the Roman Empire covers a period of about 250 years, roughly from the death of Marcus Aurelius to the invasion of Rome by the Goths in the year 410. The Diocletian period of price and wage controls. nationalization, and suppression of the farmers and the unions falls about halfway between Marcus and the Goths. Some of the human reactions described above reached their extreme forms during the terminal devastation after 410. However, as late as the year 372, the year the Huns crossed the Volga, eventually pushing the Goths before them toward Rome, there were 175 holidays a year in the city: 64 at the circus, ten replete with gladiatorial contests, and the rest with shows, fun, and the theaters. It could never be said that the original consumers failed in their duty toward modern writers who see the ghost of Rome in the "next 25 years" for the United States.

But let us hope not. Let us rather hope that amidst the real crises which now lie ahead of this great society, we can still preserve the essential propositions of the human estate. Let us hope that we can move on toward a workable, multi-racial society in which many of the cruelties of this one have been overcome. Let us trust that amidst the social torment of the next 25 years, we can seed a creative period in American history that out of the anger will come a greater wisdom of ourselves.

7.