President Carter continued his personal campaign for a "windfall profits" tax on the oil industry yesterday, warning the industry that he will insist that it use the additional revenues it gains from the decontrol of oil prices to expand domestic oil production.
"The nation has a right to expect that all of this new income will be used for exploration for oil and gas and not to buy timberlands and department stores," the president told a nationally televised news conterence.
Carter spoke sympathetically of requiring the oil companies to divest themselves of interests in other energy-related firms, such as coal companies, saying it should be "explored thoroughly," and said he would favor either congressional or administrative action "to encourage [the] use of increased revenues for oil and gas production."
The news conference, the first Carter has had with Washington reporters since Feb. 27, was dominated by domestic issues such as energy and the economy.
The president, in response to other questions, said he has "never known, nor do I now know, of any illegal action taken at Carter's Warehouse," his family's peanut business in Georgia. Some of the firm's financial transactions during the time Carter was running for president now are being scrutinized by a special Justice Department investigator.
Carter announced last week that he is ordering the gradual decontrol of domestic oil prices, at the same time calling on Congress to enact a 50 percent windfall profits tax on the additional revenue that decontrol will mean to the oil industry.
The president has seized on the issue, pushing for the tax in a speech to a political dinner in Richmond Saturday night and again yesterday in a prepared statement opening the news conference. He intends to keep up the campaign, both to pressure Congree to enact the tax and because White House officials clearly believe the president cannot lose politically by pitting himself against what he consistently portrays as a greedy oil industry.
"The American people are willing to face the hard reality of the petroleum problem," Carter said yesterday, "and they are willing to see oil priced on a realistic basis. But they are not, and I am not, willing to see their sacrifices mocked by a wholly unjustified giveaway to the oil companies. . . . "
The president, disclosing his basic strategy on the issue, said he has deliberately sought "to narrow down the focus of the congressional debate primarily on that one issue-should we or should we not let the oil companies capture about $15 billion which they have not earned, or should we retain a substantial portion of that to meet the needs of the American people?
"That is the basic issue," he added. "And I think because the issue is so clearly defined and the mood of the country has changed and I can focus on that issue with the full resources of my office, I believe it will pass."
Carter favored so-called "horizontal divestiture" of the oil industry-forcing the oil companies to rid themselves of energy-related interests-during his campaign. But the administration has done nothing along that line, and White House officials yesterday did not attempt to suggest that any such steps are planned soon.
Instead, the president's public embrace of the concept of divestiture and his support for unspecified steps to force the oil industry to invest its additional revenues in oil exploration and production appeared to be a warning to the industry about the possible long-term consequences of resistance to administration energy policies.
For the oil companies "to take that money and use it to buy circuses or to buy timberlands or to buy motels or department stores, I think contravenes the need of our country and it contravenes the purpose that I and the Congress have in mind when we give them that additional revenue," he said.
On other topics during the news conference, Carter:
Opposed a halt to further arms sales in the Middle East because of terrorism, which he said is bound to continue. The president said the "quick ratification" of the Egyptian-Israeli peace treaty by Egypt would help convince everyone that the peace "can't be disrupted by terrorist acts."
Earlier yesterday, the White House announced that special trade representative Robert A. Strauss will head a U.S. trade delegation to Israel and Egypt April 16 to 20 to seek increased trade with both countries.
Said the United States remains committed to increased economic aid to Turkey, and that the issue will be discussed when he meets with the leaders of the United States' industrial allies in Tokyo in June.
Said he still hopes to submit a balanced federal budget to Congress next year, but called a suggestion for a tax surchange to help balance the budget "inadvisable" and "impossible."
Said it would be a mistake to push for legislation controlling handguns because of resistance in Congress.Carter's statement provoked an immediate response from Handgun Control Inc., a lobbying organization, which accused him of "failure to exert leadership on the handgun-control issue" and of being "imtimidated by the gun lobby."
Repeated his long-standing assertion that there is no immediate prospect for a need to reinstitute the military draft.
On the investigation of the Carter Warehouse finances, the president was asked whether he knew at any time in 1976 or later of cases in which the terms of loans to the warehouse were not completely honored. He did not respond directly to the question, instead offering a strong denial of any illegalities. CAPTION: Picture, PRESIDENT CARTER . . . rebuts warehouse allegations