January 24, 1975

Defense Sec Schlesinger, responding to questions after speech at NYC Econ Club, says US has ample supplies to sustain Israeli fighting forces should 5th Middle East war begin, while maintaining US forces' combat readiness; explains US arms production was escalated when large‐scale supplying of Israel in '73 disclosed Amer arms production deficiencies and aroused concern within service branches; Defense Dept responded by granting Army auth to increase tank production from 40 units per mo to 103 (M)

Pres Ford, in TV int, says on Jan 23 that if his plans for imposing energy taxes are rejected, he will accept arbitrary allocation of petroleum products instead (S)

Pres Ford, in NBC‐TV int, says US would not rule out use of force if faced with ‘strangulation’ by oil‐producing countries; is asked by John Chancellor about Earl C Ravenal article in New Republic stating that 3 Army divs are being readied to be sent to Middle East, a rept which Chancellor says Pentagon has confirmed; Ford declines comment; Major Gen Winant Sidle later says there are no such plans (S)

Pres Ford signs proclamation increasing fee on imported oil by $3 a bbl over 3 mo period beginning Feb 1; Dem members of House and Sen charge action is abuse of Pres power; Ford and Treas Sec Simon defend speed with which fees will be imposed; House Ways and Means Com prepares bill prohibiting any change in oil import fee for 90 days and is expected to attach it to bill increasing statutory debt limit, which must be passed by Feb 18; Repr Bill Archer believes House would override veto if one is attempted; Sen Kennedy has enlisted 50 co‐sponsors for bill prohibiting imposition of import fee for 60 days; Reprs William J Green and James C Corman of Ways and Means charge Ford action violates trade act; Corman draws from Simon admission that Treas began on Jan 4 the required investigation of consequences of fee; 1st accts in press of decision to raise fee appeared just 6 days later, and Ford formally announced decision just 9 days later; Ford illus signing bill with Admr Frank Zarb and economic advisers Alan Greenspan and L William Seidman (M)

Many Britons opposed to membership in EEC reptdly have formed ‘Get‐Out’ orgns and plan to campaign vigorously against mkt on grounds that it has caused high prices and works to diminish Brit sovereignty (S)