THE PRESIDENT: Good morning. The Department of Commerce announced
that our economy grew by 5.8 percent in the first quarter of 2002.
That's a very encouraging sign for American workers and American
families. Yet, as encouraging as this number is, I am not content.
We've got more to do.
This morning I had a conference with my economic team, and we all
agree that a major force contributing to the high growth figure is a
short-term swing in inventories. This means that the impetus behind
growth won't last very long, that we must continue working to make sure
the short-term recovery is a long-term recovery.
Today's report is strong evidence, however, that our tax relief
plan is working. If you look at the figures behind -- the rationale
behind the figures, you'll see that a lot of it had to do with consumer
spending. And the more people -- money people have in their pockets,
the more likely it is they're going to spend. And tax relief is an
incredibly important part of this recovery.
Now, that's why, as part of making sure that the economy grows
long-term, is that we make the tax relief permanent, so that there's
certainty in the tax code. The economic stimulus bill I sign, passed
out of both Houses and that I signed, will help for the long-term
growth -- was an important piece of legislation that will help in the
out-months and out-years.
We must continue to encourage investment and hiring. One way to do
that is to get this energy bill done and get it to my desk. I'm
pleased that it passed the House; I'm pleased that it passed the
Senate. I look forward to working with the them on the reconciliation
to get it to my desk.
A second way to encourage long-term growth is to give me trade
promotion authority, allow me to negotiate trade agreements, which will
open up markets for U.S. manufactured products, as well as products
produced by American farmers and entrepreneurs. I'd like to get that
bill soon. I think it's an important piece of legislation. It passed
the House. Senator Daschle said he'd bring it up in the Senate. I
hope it's done quickly. It's important that it be done quickly.
Also, to make sure that our economy grows, it's important for
Congress to hold the line on spending. I submitted a budget; I expect
them to adhere to the budget. If we overspend this year, it's going to
have an effect on long-term growth.
And finally, it is important to pass the terrorism insurance bill.
One of our concerns is that as a result of people not being able to get
proper insurance against terrorist acts, capital -- construction
projects in the private sector that normally would have gone forward
haven't done so far.
So these are the steps that are necessary to make sure the --
that we have long-term growth in our economy. I'm pleased with the
numbers. I realize there's going to be some -- it's an estimate, there
will be other revisions on this quarter. But it's a good sign. It's a
good sign that we're on the path to long-term recovery. But, as I
repeat, I'm not content with this number, and I know we've got a lot of
work to do.
I'll answer a couple of questions. Scott, why don't you start.
Q Mr. President, late yesterday the Saudis said they had warned
you that U.S. credibility could suffer because you haven't done enough
to rein in Sharon. What did you say to the Crown Prince on that, and
what's the next U.S. move?
THE PRESIDENT: Well, I told the Crown Prince that we've got a
unique relationship with Israel, and that one thing that the world can
count on is that we will not allow Israel to be crushed. And I think
that's an important statement to make. It's a part of our foreign
policy, it has been a part of our foreign policy, it will continue to
be a part of our foreign -- the Saudis understand that.
I also reiterated what I told the country and the world on --
early April, and that is all parties have responsibilities in order to
make sure there is peace. The Crown Prince is interested in peace in
the region, and so am I. And I said to the Crown Prince, and he -- and
we had a good discussion about the obligations of the Arab nations.
The Crown Prince was clear in his denunciation of terror. Chairman
Arafat has got obligations, and so does the Israelis. And I once again
enunciated what those obligations are. And so that the Crown Prince
understands my foreign policy. And it's important that we speak with
clarity, and I will continue to do so.
Q It's been two weeks since you said that Israeli withdrawal
ought to be coming without delay, and yet yesterday there was yet again
another incursion looking for Palestinians. Have you talked -- what
else can you say to the Israelis to make your point clear?
THE PRESIDENT: The Israelis understand my position. I've been
very clear on that. And there has been some progress, but it's now
time to quit it altogether. It's time to end this --
Q Why don't they --
THE PRESIDENT: Well, we'll see what happens. It's -- I know
they've heard us.
Q Mr. President, you've called again for making the tax cut
permanent. But there's new figures out now suggesting that the deficit
may double -- may be double earlier forecasts because of a shortfall in
tax collections. How do you reconcile that? How do you deal with that
larger --
THE PRESIDENT: Well, first of all, let me remind everybody of the
facts. I haven't seen this particular story. Of course, it's all
speculative to begin with. I don't know the models that they guessed,
but it's guesswork thus far. In our guesswork from the OMB, we
projected over $100 billion of deficit.
I remind -- I want to remind you what I told the American people,
that if I'm the President -- when I was campaigning, if I were to
become the President, we would have deficits only in the case of war, a
recession or a national emergency. In this case, we got all three.
And, therefore, we're recovering from all three.
Now, I have submitted a budget that sets clear priorities. And the
number one priority is to defend the homeland. And I expect Congress
to pass the defense appropriations bill early and get it to my desk.
That's going to be an important signal to send our own military, for
the country to send to the world, that we're in this for the long
haul.
But the best way to build up -- you know, the best way to reduce
deficits and to get back into balance is to encourage economic growth.
The more growth there is, the more tax revenues there will be coming
into the Treasury. And hold the line on spending. It is very
important for Congress not to overspend.
We'll see whether they can get a budget. The House got a budget.
We'll see whether or not the Senate gets a budget. But I've laid out
my budget. I'm very serious about the budget. And the best tool I
have besides persuasion is to veto. And I'm mindful of what
overspending can mean to interest rates or expectations of interest
rates. And it's very important that we hold the line on spending.
Stretch. Did you run today?
Q I did, this morning.
THE PRESIDENT: Do you care to tell the country what your time
was?
Q You know what, I forgot to turn my watch on. (Laughter.)
THE PRESIDENT: Feeble excuse for a slow run. (Laughter.)
Q It was a slow run. It was a slow run.
Some conservatives in Congress, including Representative DeLay, are
pushing at a resolution to take a very strong pro-Israel stand. A
bipartisan group of lawmakers want to put some more aid to Israel,
roughly $200 million, into the supplemental. Do you support these
positions, and do they in any way complicate your desire to make clear
to moderate Arab nations that you're making demands on everybody --
THE PRESIDENT: Well, first, let me address the supplemental. I
submitted a supplemental, and when I did so I was mindful that
oftentimes supplementals become -- a supplemental can be a vehicle for
a lot of additional spending. In order to make sure our economy
remains strong, we've got to watch the line on spending. And so when I
said when I submitted the supplemental that this was a number that was
comfortable with, I meant that.
In terms of the resolution, I haven't seen it, but I'm not
surprised that Congress would want to express its strong support of
Israel. This is clearly a Congress that believes that our relationship
with Israel is unique and Israel is a democracy. I also hope and
believe that Congress recognizes we've got interests in the area, as
well, beyond Israel, that we've got -- have good relationships with the
Saudis and the Jordanians and the Egyptians, and our foreign policy is
aimed to do that. People know exactly where I stand, and that's very
important in the realm of foreign policy.
Now I've got to go over to a friend-raiser.
Q A friend-raiser?
THE PRESIDENT: Well, that's opposed to a fundraiser.
Q What's a friend-raiser?
THE PRESIDENT: A friend-raiser? Well, it's a -- well, it's just
kind of a cute way of saying I'm going to go over and see people and
thank them for being a part of my campaign. And they actually get to
do this for free. And I'm glad. But these will be people, evidently,
from all around the country. I haven't seen the list, but I'm told
that they are. And I look forward to thanking them -- it's really a
way of thanking people, many of whom I -- I suspect I haven't seen
since I've been the President. It's a nice, casual setting to say
hello to people. And I'm looking forward to it.
And then, of course, tomorrow night, for those of you who followed
the campaign, we'll all be going to watch little Logan get married.
It's going to be an emotional moment for us, because we love Logan.
And, interestingly enough, Logan is marrying the niece of Don Evans'
wife. And so I've known them for a -- known the family for a long
period of time. Logan's bride's father was the Boy Scout in my Cub
Scout den. Now, you can chew on that for the rest of the day.
(Laughter.)
Root, good to see you. How's little Root?
Q Good, he's doing good. His fingers are about like mine.
(Laughter.)
THE PRESIDENT: Tell him hello for me. Tell the bride hello.
Q You know, they've got a lot of planes out at the airport
there.
THE PRESIDENT: Are there?
Q -- little planes flying in --
THE PRESIDENT: Well, they're coming in for a friend-raiser.