National
THE BATTALION
FRIDAY, FEBRUARY 13, 1981
Page 11
Despite Reagan economic warning
January consumers increase buying
f MANOR EAST 3 *
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FRIDAY AND SATURDAY
United Press International
WASHINGTON — Consumers
are surprising financial experts by
significantly increasing retail pur
chases despite interest rates and
uncertainty about President
Reagan’s still-secret economic
plan.
A Commerce Department re
port released Wednesday showed
retail sales for goods ranging from
cars to garden supplies rose to
$184 billion in January, a 9 percent
increase over December.
It marked the eighth straight
monthly increase. But what star
tled the experts was the size of the
jump, considering recent talk of
economic gloom and doom.
Just last week, Reagan said the
country was in “the worst econo
mic mess” since the Great De
pression and was threatened by an
“economic calamity of tremen
dous proportions.”
Next week, Reagan unveils
specifics of his plan to remedy an
economy that — despite higher
retail sales — remains in trouble.
The Commerce report showed
sales of automobiles and related
items rose 14.1 percent in Janu
ary. Excluding these purchases,
retail sales increased 3.56 per
cent.
“This definitely was stronger
than expected,” said Dave Ernst,
vice president of Evans Econo
mics, Inc., an investment counsel
ing firm.
He said a poll by his firm found
most experts anticipated an in
crease in January, but only about
half of what the Commerce De
partment found.
However, Jeff Edelman, an
analyst who follows retail trade for
the brokerage firm of Dean Witter
Reynolds, appeared unim
pressed.
“During this period of the year,
when you’re going from the big
gest month, December, to the
smallest month, January, you
quite often get quite a bit of statis
tical distortion,” he said.
Edelman said auto sales, which
fueled the overall surge in retail
sales, was due not to demand but
rebates.
Even with the increase in sales,
last month was the auto industry’s
worst January, in terms of sales,
since 1975.
U.S. automakers sold 469,832
cars, down 20.1 percent from
Reagan promises to put
Hispanics in top positions
United Press International
WASHINGTON — President Reagan promised
national Hispanic leaders Thursday he’ll soon name
five Latins to top-level administration posts — a
pledge one White House aide said should smooth
some “understandably miffed” feelings.
Speaking with reporters after a lunch hosted by
the president for leaders of 20 Hispanic organiza
tions, Raul Yzaguirre, president of the National
Council of La Raza, said Reagan is “clearing” five
Latins for sub-Cabinet appointments.
Reagan gave no details on the appointments, Yza
guirre said.
“The substantial dialogue was quite minimal, he
said of the White House lunch.
Other sources said later Latins likely will be
named to the Immigration and Naturalization Ser
vice, the Small Business Administration, and the
Commerce and Treasury departments.
Yzaguirre, one of 12 Hispanic leaders who told
Reagan in a letter last month that his failure to
appoint a Latin to the Cabinet was a “very negative
signal,” said Thursday the president now seems
“more sensitive.”
Although he said none of the lunch guests asked
Reagan why he waited so long to meet with Hispa
nics, a delay pointedly noted in last month’s letter,
Yzaguirre said Reagan “indicated his concern for
continuing access.”
Ernie Garcia, staff aide to Reagan’s public liaison
assistant, Elizabeth Dole, said Hispanics and other
special interest groups will be handled through
Dole’s office.
He said Dole “has long been trying to arrange”
Thursday’s luncheon. Garcia, who worked on
Reagan’s presidential campaign, said Hispanics have
been “understandably miffed. It’s been so long and
they hadn’t heard anything from the president.”
Garcia said Thursday’s lunch, opened briefly to
photographers, marked the start of cooperation be
tween the administration and the nation’s fastest-
growing minority.
“Not in a symbolic way, but substantially,” he
said.
But not all the guests gushed optimism. David
Montoya, president of the Mexican-American orga
nization IMAGE, said Reagan tried to reassure His
panics his administration will cut only welfare prog
rams that overlap each other.
“One example he used was the school lunch prog
ram,” Montoya said, “But I find it hard to believe
that someone who is eating a free breakfast and a free
school lunch is eating too much.”
Cabinet members accept
Reagan's sweeping budget cuts
United Press International
WASHINGTON — President
Reagan is reviewing his proposed
budget cuts with Cabinet mem
bers who thus far have voiced no
opposition — apparently having
accepted cutbacks as part of their
jobs.
White House press secretary
Jim Brady said a “spirit of consen
sus” has prevailed during meet
ings between Reagan and Cabinet
officials who have echoed his con
cern for bolstering the economy
with fiscal restraint.
Post reported the administration
has scaled back its forecast of how
much the actions to be announced
next week will benefit the eco
nomy.
It said new projections suggest
slower recovery and higher infla
tion than the optimism previously
expressed by Reagan advisers. It
quoted administration sources as
saying inflation next year is fore
cast at 7 percent to 8 percent,
rather than the 6V2 percent rate
projected earlier.
The White House has suc
ceeded in keeping media atten
tion focused on its domestic prog
ram. However, Reagan did confer
Wednesday with his top diploma
tic and military advisers on rising
tensions in Poland.
Reagan also tapped two friends
for top diplomatic positions.
William Wilson, a member of
Reagan’s “kitchen cabinet,” was
" chosen as his representative to the
Vatican, and Leonore Annenberg,
wife of millionaire publisher Wal
ter Annenberg, was named chief
of protocol.
Reagan may hear some protests
today, however, while meeting
with the heads of independent
agencies whose spending he appa
rently is determined to cut deeply
despite mounting opposition.
Among them were the chiefs of
the Appalachian Regional Com
mission, the Tennessee Valley Au
thority, the Environmental Pro
tection Agency, the Veterans
Administration, the National
Aeronautics and Space Adminis
tration, the Postal Service, the
National Science Foundation and
the Export-Import Bank.
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MIDNIGHT:
At a budget session Wednes
day, Reagan decided on final fi
gures for the Departments of
Health and Human Services,
Agriculture and Interior. Labor
and Commerce were to be re
viewed today.
The president will disclose
these and other proposed cut
backs in an address to Congress
Feb. 18.
Brady declined to say whether
any of the federal programs under
scrutiny are targeted for extinc
tion. He said Reagan’s address to
Congress will answer that ques
tion.
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Included in Reagan’s economic
package will be an annual 10 per
cent tax cut for three years.
Reagan appears to be leaning to
ward a reduction retroactive to
Jan. 1.
7:15
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EAST
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10:40
Besides examining budget
costs, Reagan today planned to go
to the Lincoln Memorial to place a
wreath at the base of the Abraham
Lincoln statue commemorating
the birthday of the Great Emanci
pator.
Later in the day, he planned a
luncheon for Hispanic leaders and
meetings with Italian Foreign
Minister Emilio Colombo and
Qais Abdul Munim alZawawi, the
foreign minister of Oman.
On Friday, Reagan is to go to
Camp David for an extended holi
day stay and to work on his speech
to Congress.
Meantime, the Washington
CHROME
AND
HOT
LEATHER
January 1980. Imported car sales
dropped even more, by 20.7 per
cent, to 170,000.
Ernst said the most significant
Commerce Department finding
was a 2.87 percent increase in
sales of durable goods. He said this
was further evidence of a resump
tion in credit purchases — a possi
ble indication of renewed consum
er confidence in the future of the
despite high interest rates.
Ernst said the figures show in
terest rates “did a lot less damage
to the credit-sensitive sectors of
the economy than was expected.”
John McGillicuddy, chairman
of Manufacturers Hanover bank,
said he expects interest rates to
remain high throughout 1981 re
gardless of what Reagan does.
economy.
A Federal Reserve Board re
port, meantime, showed Amer
icans added about $1.6 billion, or
about 6 percent, to their outstand
ing installment debt in December
Major banks have been reluc
tant to lower their prime rate to 19
percent from 1914 percent, as
Morgan Guaranty Trust and
Manufacturers Bank of Los
Angeles did Monday.
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