For Immediate Release
Office of the Press Secretary
July 24, 2002
Press Briefing by Ari Fleischer
James S. Brady Briefing Room
12:44 P.M. EDT
MR. FLEISCHER: Good afternoon. Let me give you a report on the
President's day, then I have a statement I'd like to make. The
President began his day at 7:00 a.m. this morning with a breakfast with
the Speaker of the House, the Majority Leader of the Senate, the
Minority Leader of the House and the Senate, where they discussed the
pending items left on the congressional agenda. The President
reiterated his call for Congress to take prompt action on legislation
to create a Cabinet-level department of homeland security, to pass
trade promotion authority, and also to take action -- final action
and reach a conference agreement on legislation on corporate
corruption. After the breakfast the President had his briefing with
the CIA, the FBI. Then he convened a meeting of the National Security
Council.
Following that, the President met with the Prime Minister of Sri
Lanka, where they discussed -- or the President expressed his
appreciation for Sri Lanka's strong democratic tradition. He welcomed
the Prime Minister's initiatives, supported by the Norwegian
government, to bring the Liberation Tigers of Tamil to the negotiating
table. The President offered American support for Sri Lanka's pursuit
of peace in this endeavor, and economic development and proposed to
send several teams to assess how best we can work together in those
areas. The President and the Prime Minister welcomed the intent of the
Peace Corps to return to Sri Lanka as soon as conditions permit.
Later this afternoon the President is going to have two meetings,
one with the Democrats, one with a group of Republicans, to discuss
congressional action on creation of a department of homeland security.
As you can tell, as it gets down to the wire in the Congress, the
President is making a lot of personal efforts to help Congress finish
its busy agenda -- creation of a Cabinet-level department of homeland
security remains an important presidential priority.
On the matter of presidential priorities, today marks a day of
action and accomplishment in the President's fight against corporate
corruption, in his effort to vigorously enforce the laws and protect
employees and investors against corporate wrongdoing. The arrest today
of five former corporate executives on charges of securities fraud,
wire fraud and bank fraud, is a clear sign of this administration's
commitment to enforce the laws so justice can be done.
The President's corporate fraud task force is hard at work in
fulfilling the President's directive to fight corporate fraud. The
actions today, of course, come on top of the administration's earlier
successful prosecution of Arthur Andersen for obstruction of justice.
The President also is very pleased that congressional conferees
today reached an agreement on reforms that will protect investors, root
out fraud and hold business leaders accountable. The legislation
includes the President's proposals to crack down on corporate
wrongdoing, and it establishes an independent oversight board to police
the accounting industry.
The President calls on the House and the Senate to pass this plan
so that he can sign it into law. And the President looks forward to
signing it into law.
All these actions also come on top of the Securities and Exchange
Commission's previous actions to fight corporate wrongdoing. The SEC
has already issued and are already requiring CEOs and CFOs at the
nation's largest companies to personally re-certify the accuracy of
their books. In the last four months, the SEC has sought the
forfeiture of the ill-gotten profits of more business leaders than
they've sought for all of last year. And in the first eight months of
this fiscal year, the SEC has sought to bar more corporate officers and
directors from ever holding positions of trust in corporations again
than they sought in all of last year.
This administration will hold accountable corporate executives who
violate the public trust. And we will do so in a way that we can do
everything possible to protect America's workers and investors.
And with that, I'm happy to take your questions. Campbell.
Q What does the President think about his SEC Chairman, Harvey
Pitt asking Congress to elevate his job to a Cabinet-level position?
MR. FLEISCHER: The President is focused on the strengthening of
the SEC's structure and ability to fight fraud that the Congress just
passed. That's what he's asked for. He's pleased that will be signed
into law. That's where his focus is at. He's not focused on that
issue.
Q So he does not -- he would not have supported that concept?
MR. FLEISCHER: That's not something that was raised with the White
House, and obviously it's not something that Congress included. But
the President is very pleased with what Congress has done on this.
Tom.
Q Did he know that Mr. Pitt was going to make this end run
around him and talk to Congress?
MR. FLEISCHER: I think it's always the prerogative of independent
agencies to talk to Congress.
Q What about the notion that SEC should be a Cabinet-level
agency? Would he support something like that?
MR. FLEISCHER: I think as you can tell from the announcement that
was made today as a result of the President's corporate fraud task
force, which includes the SEC, the SEC is on top of their job and doing
it well. And they have the status -- they have the status that they
need to enforce the laws. That status will now be enhanced as a result
of this congressional bill.
Q Ari, Daschle said today that this was one more reason, in his
view, by virtue of the fact that Pitt even asked for this, that someone
else should be in this position. Does Pitt still have the President's
full confidence?
MR. FLEISCHER: You know, today, especially, is a day of
accomplishment and results here in Washington. Today is not a day of
division. Today is a day where the Securities and Exchange Commission
-- and they're part of the President's corporate fraud task force --
has led to the arrest of five individuals charged with securities
fraud, charged with wire fraud, charged with bank fraud. The SEC is on
the job and doing it well, and that's what the President is focused
on.
John.
Q Can you tell us why, Ari, the President has asked the Treasury
Secretary to postpone his trip to South America?
MR. FLEISCHER: There is a lot going on with the congressional
agenda, particularly on trade promotion authority and, as I indicated,
on homeland security. Congress is heading out of town for more than a
month. The House is scheduled to leave this week, the Senate is going
to leave next week, and there remains a lot of pending issues. And the
President has got a lot that he's focused on,
in terms of helping make
this a Congress of accomplishment. And that's one of the reasons the
Secretary is going to stay in town.
Q The Treasury Secretary was jumped on pretty hard last weekend
for being out of town as the markets were collapsing all around us. Is
there something to that in the President's request to ask him to
postpone this trip?
MR. FLEISCHER: No, it's focused on what I indicated. There's a
busy congressional calendar and the President hopes that he can help
Congress to get their work completed.
Q Ari, what's the President's message to continued calls for
Harvey Pitt to step down?
MR. FLEISCHER: Go ahead, Goyal.
Q Ari, two questions, please. One, can you get a little more in
detail about the Prime Minister of Sri Lanka's visit? And also,
Afghani Prime Minister, why he also was in the building?
MR. FLEISCHER: If who was in the building?
Q Prime Minister from Afghanistan?
MR. FLEISCHER: No, the Prime Minister was not here. There are
several ministers from Afghanistan -- the Foreign Minister, Abdullah
Abdullah, was here, other Afghani ministers -- I think the Education
Minister. There is a summit on Afghanistan-American reconstruction
efforts taking place at Georgetown University; that has brought to
Washington a number of Afghani ministers.
That's really the report on the meeting with the Prime Minister.
The meeting lasted approximately 15 minutes, the President expressed
his strong support for Sri Lanka, for their democracy, and the closer
ties that are being forged between the United States and Sri Lanka.
Q The second question is that there -- now, we are facing the
one-year anniversary for 9/11. Many people who died left their spouses
behind, and their visas were tied to them. Now they died, and behind
left their spouses; they are now, they want to stay in the U.S., they
are nowhere. So what is the future of their visas to stay in the U.S.,
because now they lost loved ones and everything?
MR. FLEISCHER: Goyal, I think what you've seen from the nation --
and it's reflected in the policies of the administration -- has been
an outpouring of sympathy, grief, and understanding for the families
who lost loved ones in the attack on September 11th. And there are
many mechanisms of the government that have been set up, either through
the Department of Justice or through the Department of State, to work
directly with the families on a case-by-case basis to help bring
resolution to any of the pending legal issues that remain. And so all
of these are being considered by the appropriate agencies.
Q Prime Minister --
MR. FLEISCHER: You only get two. We're going to keep moving
around. Kelly?
Q Ari, number one -- two questions -- what is the
President's message to those Democrats who have used this latest news
about the SEC proposal to say that Harvey Pitt should step down, that
he's the wrong man for the job?
MR. FLEISCHER: Well, again, I think it -- today is a day that
everybody in Washington should mark as a day of accomplishment, a day
of working together, and a day of action. And the President hopes that
this will not be a day where people, for whatever reasons, choose to
focus on division, particularly when the SEC is doing as effective a
job as it has, when it has sought the disgorgements that it has, when
it has taken action to bar corporate officers. And for those who are
interested in seeking someone's firing on a day of accomplishment like
today, the President's message is that he is interested in solutions,
not scalps.
Q Let the man do his job?
MR. FLEISCHER: He is doing his job and doing it well.
Q One other thing. On the deal, you were told that the
-- that there's a deal in terms of corporate accountability. Some
Democrats have said, not a deal yet, very, very close. Have you all
been kind of given the particulars of the deal and is it something the
President definitely, absolutely could sign?
MR. FLEISCHER: The President looks forward to signing this into
law. We have been briefed enough on what is in there, the changes that
were made and, of course, the provisions that the President sought when
he went to New York City and gave a speech on corporate governance
involving, for example, expanding the maximum sentence from five years
to 10 years for people involved in fraud, are all part of the
proposal. The House's action on tough penalties is in the final
agreement.
One of the issues that the administration cited that was something
that we wanted to see resolved in Congress dealt with the overlapping
jurisdictions between the newly created independent accounting board
and the Securities and Exchange Commission. And under the agreement
that's been reached by the conferees there is now a bipartisan
agreement to make changes to the Senate bill to strengthen the SEC
oversight of this new independent board. And we're very pleased with
that change.
We're going to continue to review the language. As always, any
time a conference agreement is reached that does require the paperwork
to be put together, we'll continue, of course, to read and to study the
paperwork along with the Democrats in the Senate, Democrats and
Republicans, who brought today's announcement forward. So we'll take a
look in the fine details. But everything we've seen and heard is
positive and the President's looking forward to signing it. It was a
good process. They worked well with the White House. Changes were
made. They listened. And the nation is better for this.
The nation is better for it, and this agreement also provides
certainty. Now business leaders, corporate community, taxpayers,
investors and employees have certainty about what the new rules will be
so that everyone will know they will be held accountable, they must
live by them.
Jacobo.
Q Ari, last night the House of Representatives by very large
margin, 262 to 167, voted against the President's wish to approve
easing travel of Americans to Cuba and also lifting restrictions on
cash -- money or benefits that may be sent there. This is part of the
Treasury appropriations bill.
MR. FLEISCHER: Right.
Q You have said from this podium the President would veto the
bill. Will he veto it?
MR. FLEISCHER: The President had issued -- the administration
had issued a statement of administration policy on that matter, and
that remains an issue in contention which the President has said he
will veto if that remains in the final bill. And so I think what you
can anticipate, as this bill moves through the process and people
realize that it's a serious message, the President is hopeful that that
provision will be removed so that the bill can be signed into law.
Q Second question. Yesterday, the President met with the
President of the Dominican Republic, Hipolito Mejia. Today, the main
newspaper in the Dominican Republic, Listin Diario, has on the front
page a story that President Bush and President Mejia agreed to include
the Dominican Republic in the negotiations that the U.S. is having with
the Central American countries for a free trade agreement. Is that --
MR. FLEISCHER: That was a drop-by that the President did when the
President of the Dominican Republic was here visiting Dr. Rice, so I
was not in attendance at that meeting. I don't have any info for you
on that. Let me see if we can get that and give you some clarification
on that.
Q Will you post it, please?
MR. FLEISCHER: Yes, we'll be happy to.
Q Under the President's plans for Social Security reform, what
would happen to investors, young investors or anybody, who took part of
their Social Security money and put it in the stock market and saw the
kind of drop in the market that has happened?
MR. FLEISCHER: It all depends on the exact dates in which people
began their investments. And so if they began their investments in
1982, for example, their return on their money would be sharply up. So
it's an idiosyncratic matter depending on the exact circumstances of
people's times and investment decisions. But the President --
Q So --
MR. FLEISCHER: -- the President does have faith in allowing
younger workers, as a part of Social Security, to have the option at
their choice of investing a portion of their Social Security taxes in
other investments rather than just having it withdrawn from their
paycheck in a system where the demographics clearly show they will not
get a return on their money.
Q Would there be any backstop, safeguard for investors if the
market were to drop on them by, you know, 10 percent, 20 percent?
MR. FLEISCHER: Terry, that would all depend on any of the
decisions that Congress makes as legislation is put forward. But
suffice it to say, the President does have faith, fundamentally, in the
ability of people to use their own discretion, make their own
judgments. And he thinks that younger workers will welcome the
opportunity to have more control over their own money so they can make
decisions as they see fit.
Q Still? Last question. Still? Has what happened in the
markets undermined political support for the President's plan?
MR. FLEISCHER: No, the President is focused on doing what's right
long-term, the right policies. And the President is very worried about
the future of young people. People who are older than 50, for example,
right now, there are going to be no changes under what the President
proposed for Social Security. So what the President is talking about
are no changes at all for people approaching the retirement age. They
will continue to get Social Security. Social Security will be there
for them.
But the President is very worried about younger people, who are
going to pay a lifetime of high taxes and, under current trends, not
get back the money they paid in for Social Security. That's a negative
rate of return, and the President wants to provide them with more
options, if they decide that they want to exercise them, on a voluntary
basis. He thinks that's something that younger people deserve to have
the right to choose.
Tom.
Q This bill is kind of languishing up on the Hill. Is the fact
that you mentioned it today, is the President going to try to renew his
push for this legislation? And when you talk about -- when you say
"younger workers", as I remember it from the campaign, there wasn't any
kind of an age cutoff. It would have been available to anyone, and
just that someone close to retirement wouldn't probably be smart in
doing this --
MR. FLEISCHER: No. No. Number one, I mentioned it today because
your colleague, Terry, asked me about it today. Number two, no, just
go back and take a look at exactly what the President said.
Q So when you say "younger workers", you're not talking about
putting in the legislation some kind of an age cutoff, are you?
MR. FLEISCHER: Absolutely. That's what the President announced
the day he announced it.
Jean?
Q Two questions. You've made it clear that Harvey Pitt's not
going to lose his job today. (Laughter.) But does he still have the
full faith and confidence of the President?
MR. FLEISCHER: He does. Particularly on a day like today, I think
that everybody in Washington should take a step back, breathe in, and
recognize today as a day of real action and accomplishment, and give
the SEC, the FBI, the Department of Justice the credit that it deserves
for taking the action that's been taken today, for the successful
accomplishment of legislation, and for the enforcement of current
laws.
The American people want new laws to make certain that there is
certainty about the rules that corporations have to live by. But the
American people also want the laws to be enforced, and enforced
strenuously and vigorously and aggressively. And that's what the SEC
is doing.
Now, this is Washington, D.C. and there are always going to be
people who want to look past the accomplishments and look past the
action and focus on division and search for a scalp. And that is so
much part of the old Washington that this President is determined to
change, because this President is going to focus on solutions.
Q Second question, what was the President's first reaction when
he heard that Harvey Pitt was looking to elevate himself to
Cabinet-level status and get himself a pay raise?
MR. FLEISCHER: I shared with you what the President is focused
on.
Q What was his first reaction?
MR. FLEISCHER: I wasn't with him as he read the papers this
morning.
Ken.
Q Ari, when you talk about Social Security you keep saying
younger workers will put money in and get nothing back from it. That
would be true only if future Presidents and future Congresses do
absolutely nothing and simply allow the demographic train wreck to
occur some decades down.
MR. FLEISCHER: Correct.
Q Nobody who has looked at this problem thinks that that's going
to happen. They agree that -- they disagree over the options, but
everyone thinks that something is going to be done. Isn't it deceptive
to be saying to younger workers, as you say repeatedly, you're going to
get nothing out of this system?
MR. FLEISCHER: Well, under current trends, they will. That's an
accurate statement. And the three --
Q But in reality, it's extremely unlikely.
MR. FLEISCHER: Well, the reality is that there are three options
available. One is to raise taxes, which was done before and hasn't
worked. The second is to cut benefits, which is something the
President doesn't support. And the third is exactly the President's
proposal, to allow younger workers to right on a voluntary basis to put
a portion of their Social Security taxes in other investments, whether
they're fixed-income investments, bond investments, equity investments,
as younger workers see fit. This is for more choices for younger
workers, and I think that's something that younger Americans are
looking forward to, and they understand the value of a long-term
investment.
David.
Q I have two questions, Ari. First, there's been a lot of talk
around of proposals, some originating in this building, to encourage
investors to go back in the market -- cuts in capital gains for new
investments, other kinds of proposals. What's the President's view on
this? Does he think that the federal government should use tax policy,
or any other kind of policy at this point, to try to encourage people
to go back into the market?
MR. FLEISCHER: Well, one, these decisions will be made on an
individual basis by investors. They will make their own decisions
based on their own judgments, and about whether they --
Q That's a separate problem. I mean, what should the government
role be?
MR. FLEISCHER: The government role should be to promote policies
that promote soundness in the economy and focus on the fundamentals of
the economy. And there are many such proposals that are new that are
pending in the Congress. And the Congress this week has a chance, for
example, on trade promotion authority, to enact one of those
presidential proposals that will help grow America's work force, create
more jobs domestically, which creates more income for people, which
helps boost the economy -- as well as just good for families. And
that's where the President is focused.
Terrorism insurance is another matter that is pending in the
Congress that is -- if Congress does not act to pass terrorism
insurance, it's going to make it a lot harder for construction workers
to get jobs. And all these are the things that the President is
focused on as he deals with the Congress. Over the course of time, and
next year, will the President have additional policies, as part of next
year's budget or anything else? I think it's way too premature to even
focus on that.
Q But he's opposed to target --
MR. FLEISCHER: I'm sorry, did you have a second, David?
Q I did have a second question, and that is your discussion
today of these five arrests is a little bit unusual, in that there have
been many, many other arrests or indictments on corporate issues that
have not been celebrated from this podium before. Was the White House
particularly involved in these five?
MR. FLEISCHER: The White House is involved to the degree that the
President, as you know, created the task force, because of his focus on
cracking down on corporate wrongdoing. And the President met, as you
remember, a week ago Friday with the leaders of the corporate task
force at Department of Justice, gave them their charge. But these are
Department of Justice task force decisions about enforcement actions,
prosecutions, and that's where the action stays. The President --
Q I know your -- acts quickly, but were they acting fast
enough that they were involved in these five cases?
MR. FLEISCHER: The task force?
Q The Department of Justice task force?
MR. FLEISCHER: That's exactly what Deputy Attorney General
Thompson said, this is a result of the corporate task force. You can
read the Deputy Attorney General's remarks. That's what he indicated.
Q A follow-up to David --
MR. FLEISCHER: You've already gotten a couple. There are people
with their hands up who haven't gotten any yet. Your row got some. We
missed your row. We'll come back.
Q How about the row on the side?
MR. FLEISCHER: We'll come back. Connie.
Q Regarding your opening statement on corruption, you used the
phrase "the forfeiture of ill-gotten gains." Now, can that happen
without an expensive lawsuit? And is the administration, is the White
House doing anything to help the people who were defrauded get their
money back, again, short of these very expensive lawsuits?
MR. FLEISCHER: Well, in the legislation the Congress has reached
an agreement on today, that the conferees reached an agreement on
today, the President is pleased that his proposal which would allow the
SEC to take action, for example, to bar officers from serving again,
does not have to go through an administrative procedure. The SEC will
now have the authority itself to do that; it doesn't have to go through
a court procedure.
There is also in there a provision in this agreement to provide
assistance as a result of some of the fines that are issued as a result
of SEC enforcement actions to help investors or shareholders to recoup
some of their losses as well as, I think, employees. We're looking at
the fine print of the language. But they do have language in the
conference agreement dealing with compensation for other investors or
employees. We'll take a careful look at exactly how Congress phrased
it.
Q What do you make of what's happening in the stock markets
today?
MR. FLEISCHER: It's not the place of the White House to comment on
-- you're well aware of this. The White House policy is we do not and
will not comment on day-to-day fluctuations in the market.
Q No, but you did comment on the fact that this introduces some
certainty back into the situation, that the nation now has some
certainty as a result of action on this. Many Republicans had
suggested that it was the lack of certainty about what the government
was going to do, whether it would do too much or not enough, that had
roiled the markets. Would you at least comment on --
MR. FLEISCHER: I'll just separate the issues, because I will not
comment about day-to-day fluctuations up or down in the market. But as
I indicated, one of the strengths of this legislation is that now it
does bring certainty, so that corporate officials, investors and
employees will know what the new rules are. And they will also know
that this administration will move vigorously to enforce those rules
and apply them fairly to all.
Q Now, on a different issue, Secretary Mineta yesterday talked
about taking another look at arming pilots. My impression had been
that the administration was against the idea of giving pilots --
arming pilots. Is there a second look at this issue now?
MR. FLEISCHER: Well, Secretary Mineta, as your question pointed
out, indicated yesterday the Transportation Department will take a look
at this, will review the matter. Given the constraints that they're
under, there are some real limitations to any type of training, which
is something that has always been talked about as part and parcel of
this. And the President from the beginning has said that he was going
to be guided by safety considerations and would listen to his safety
experts to determine if there was a way that this could be achieved or
not. And he'll take a look at that review when the Department of
Transportation completes it.
Q But I thought that those experts had suggested that this was
not a good idea, that it would not be safe to have pilots firing
weapons on airplanes in mid-air.
MR. FLEISCHER: I think what the Secretary wants to take a look at
in concert with his security experts, if there's any way that some type
of lesser measure can be accomplished -- instead of arming each and
every pilot who would be in a cockpit, at great cost to the taxpayers,
a cost which is clearly not in the budget provided by the Congress --
whether or not there's any alternative routes that would also provide
for safety as a result of the equipment the pilots would carry, the
standards that they would be held to, the training that they would
receive. I think those are the areas that he's looking at to see if
there's some type of in-between.
Keith.
Q Ari, the key sticking point on the trade promotion authority
bill is a trade adjustment assistance package, and House Republicans
are under a lot of pressure to accept the Senate version of that
package, which is much more generous, or expensive, depending on how
you look at it. And I'm wondering if the White House has a position on
that and if you're acting --
MR. FLEISCHER: The trade adjustment assistance is a provision that
the President supports. There are discussions going on about the
appropriate level of the tax credit that would provide the trade
adjustment assistance to workers who have lost their jobs as a result
of trade. And that's a policy the President is committed to.
The negotiations are underway on the Hill. I'm not going to make
any comments in the mid-course of negotiations. Suffice it to say that
this is a priority, this is important and this is rare. Congress has
not, for almost a decade, given a President what previous Presidents
have long enjoyed, which is the ability to negotiate multilateral trade
agreements around the world which protect American jobs, create more
jobs for America, and also strengthens the ability of nations around
the world to grow and to develop, which is an important part of
America's foreign policy.
The President cited three issues that he called on Congress to
enact this week. It looks like Congress has already taken action on
one of them, and that's the fight against corporate corruption. It
looks like Congress is moving very nicely on homeland security, and we
will see if Congress
hits the third part of the trifecta. If they do, this Congress
could be well on its way to being a Congress of accomplishment. And
that's why the President came to Washington, to help Congress to have
accomplishments, to work bipartisan and to get things done for the
country. And this very well may be a week of accomplishment that
people in both parties can take a lot of pride in.
Deb.
Q Ari, Parris Glendening is suggesting the President shouldn't
be going on vacation when all the economic turmoil is going on. Could
you tell us whether that's under consideration and what you think of
Mr. Glendening's --
MR. FLEISCHER: Well, I noticed that the story that carried those
partisan comments from somebody who is not aware of the President's
schedule was written by not anybody in the White House press corps, and
I know you all are looking forward to all the early morning bag calls
and the constant travel that you're going to be doing when the
President returns home.
The President is going to be home for approximately 25 days, and
during that period of time he's going to be visiting some 12 cities
across America, in addition to doing a lot of government business at
the ranch. As you know, the White House picks up and goes with him.
So I can assure you as the traveling White House press corps, you'll be
moaning about all the early morning calls that you'll be taking, the
long flights that you'll be taking, and the amount of business that
you'll be doing.
Q Ari, it's been reported that Vice President Cheney, under
lawyer's orders, is in hiding, won't answer questions. How does the
President feel about that?
MR. FLEISCHER: It's an inaccurate report.
Q Ari, we've heard your -- several times here about solutions
versus scalps in the accomplishments of today. But what's your
assessment of the timing of this suggestion of an elevation in status
and salary for Mr. Pitt?
MR. FLEISCHER: Again, all federal agencies that are independent
have the right to talk to Congress as they see fit. And probably never
met anyone in Washington who didn't want a raise.
Q Well, do you see the timing as a distraction from the message
you're trying to convey here?
MR. FLEISCHER: Clearly, given the accomplishments of today, it's
just the opposite. The President is focused on these accomplishments
and today, as in indicated is a day of accomplishment and a day of
action.
Q Ari, two things. First, what's the President's message for
Gracia Burnham today?
MR. FLEISCHER: The President is going to meet this afternoon with
the widow of Martin Burnham, the hostage that was killed in the
Philippines, as well as other members of the Burnham family. And I
think the President's message is going to be a message of comfort, a
message of condolences, a message of thanks from a country that knows
how difficult this has been for the Burnham family. She has been a
marvelously strong and optimistic woman with a wonderful, upbeat
outlook. And I think the President is going to enjoy just putting his
arm around her, spending some time with her and welcome her to the
White House.
Q One on the economy. There are a series of polls that show
Americans -- or at least they indicate that Americans aren't quite as
optimistic, perhaps, as the White House or the President is about the
state of the economy. What can the President do to bridge the apparent
disconnect between how the White House views the economy and how
average Americans do?
MR. FLEISCHER: Well, let me take that on directly. I'm glad you
asked me that question. Frankly, I think if you take a look at the
numbers in the polls, you'll see an abundance of good news in the
polls, which, of course, typically, becomes the last paragraph of the
stories as they're covered in the media. Let me give you some
examples.
Your premise is the public is not optimistic. Let's take the
latest poll that is out there, reading from the public information.
This is the NBC/Wall Street Journal poll that is just out today: 69
percent describe themselves as "hopeful and optimistic" about the
future of the economy. That's a pretty good number, a pretty
optimistic country -- 56 percent expect the stock market to be higher
one year from now; only 14 percent expect it will be lower.
The premise of your question is people aren't optimistic; the data
actually indicates just the opposite. The American people are telling
the pollsters that they are optimistic. Americans trust President Bush
over Democrats in Congress to address national problems that most
affect people like them, 44 percent to 39 percent; to address the
nation's economic concerns, 39 percent to 30 percent; and to address
terrorism, 62 percent to 20 percent. That's NBC/Wall Street Journal,
as well as Newsweek.
I could go on about all of the polling data. I just think that --
typically when there are polls, there's a lot of numbers that tell a
lot of different sides of the story. I just think people are in the
mood right now to cover only one side of the story. That's not exactly
balanced, but that's the way sometimes it goes.
Sarah.
Q Ari, does the President believe that Israel used a 2,000-pound
smart bomb against the Hamas leader knowing it would kill civilians in
order to derail the peace process?
MR. FLEISCHER: The President spoke out about that yesterday, and
he meant what he said. And the President did not think that this was
an action that contributed to the peace process. And the President
feels that very strongly. The President is worried about the
implications of those actions on the ability to achieve peace in the
region.
Q Back to Social Security, Ari. If, in fact, younger workers
are encouraged to invest part of their payroll tax in a private
investment account, that's going to leave a gap between financing and
benefits for those who are still in the system. That's a gap that's
been estimated by some people at about $2 trillion. How does the White
House propose to meet that transition --
MR. FLEISCHER: Well, the cost of any transition will, of course,
be determined by the amount -- the number of percentage points that
people will be allowed to put into an investment of their choice,
whether that's at a 1 percent rate, 2 percent rate, 3 percent rate. So
any guessing about the dollar amount cannot possibly be realistic until
people have focused in on what the exact determinations will be, what
the age limits will be.
We talked earlier -- when the President originally proposed this,
he talked about allowing this for younger workers. Depending on the
decision Congress makes, if it's open to people who are 40 and younger,
or 45 or 50, that will have implications on the transition costs. So
any of that comes down exactly to the precise details that the Congress
would agree to. But the fundamental issue that the President is
concerned about is helping these younger workers who pay far more in
taxes than their parents or their grandparents ever did for Social
Security.
As a result of all the very many tax increases that have taken
place in Social Security over the last 20 years, younger workers pay
far more in taxes than anybody ever has before for the same Social
Security system. And as a result, under today's demographics, the only
way they'll get back what they paid in is through a tax hike, which
doesn't work, or benefit cuts, or allowing them to have these
individual options.
Q Are there any options for meeting that gap, other than raising
taxes, cutting benefits, or government borrowing?
MR. FLEISCHER: Well, there was another option that had been
considered previously by the previous administration, which is to take
the taxpayers' money, the money that the government would collect, and
for the government to buy equities for the government to become an
owner in the stock market. And that's something that I think both
parties have clearly spoken out against.
Q Ari, a National Urban League report on the state of black
America for 2001 shows that unemployment in June was twice as high for
blacks as whites. They're still twice as likely to have low-wage
service jobs; as homeowners, 25 percent less for African Americans than
it is for whites. What does the President make of these numbers?
Urban League President Hugh B. Price said he'd like the administration
to redouble efforts to close those gaps. What does the President make
of these numbers and what's in the works to close those --
MR. FLEISCHER: Well, the Urban League wisely and accurately points
out disturbing trends in our society that have shown gaps between
whites and blacks and economic status and homeowner status, gaps that
the President is determined to close. And the President has spoken out
about this repeatedly.
The President has proposed several ways to do so. The primary one
is through the education proposals he's made to improve public
education across the country to close the achievement gap in
education. The President is very pleased that Congress, on a
bipartisan basis, enacted those changes into law.
The President, if you remember, traveled to Atlanta, where he made
several proposals to close the homeownership gap and to increase the
number of minority homeowners by 5.5 million by the end of the decade,
5.5 million people by the end of the decade. His proposals to do that
were as a result of an affordable tax credit, affordable housing tax
credit and down payment assistance so people can have the money to put
the first down payment down.
The President also is focused on the welfare-to-work proposals and
will have a lot more to say about that shortly. Welfare is another one
of those issues where the Senate has not yet taken any action, where
the House has, where the President is hopeful that Congress will act.
And the President's proposals, of course, on economic security,
strength and our economy benefit all Americans but particularly those
who have been left behind. And that's what the President is focused
on. There are major gaps in our society and the President is dedicated
to closing them. The Urban League is accurately pointing out the
data.
Q On Social Security, is the White House now prepared to support
a proposal by Congresswoman Granger that's in the homeland security
bill that would give the Transportation Security Administration and the
airports more time to put in the baggage screening equipment, maybe up
to a year?
MR. FLEISCHER: Well, Secretary Mineta has testified to the Hill
that prior to the delays in the supplemental and the funding levels
established in the supplemental, the administration can and will meet
the existing deadlines. Obviously, there are some second thoughts
about that now on the Hill, as people are hearing from their airports
about whether or not those congressionally mandated deadlines are
practical or achievable without creating massive lines at the airports
come December 31st. So this is an issue that Congress is wrestling
with as they take a look at the mandate that they've given the
administration, as well as some of the conflicting signals that have
been sent to the administration, given the funding cuts that have been
made and the caps on the number of employees allowed. So we will
continue to work with the Congress to see if the Congress changes its
tune on this.
Q -- pushing up the deadline for Dallas-Fort Worth?
MR. FLEISCHER: Well, clearly, if the Congress sets the deadline at
December 31st this year, we will do everything in the administration's
power to meet that deadline. Secretary Mineta has said we will meet
it. I think there is a growing concern in the Congress, though, about
whether or not they were being realistic in originally assigning the
deadlines they did, given the resources and the mandates that they've
imposed on the administration.
Q Two quick ones, Ari. One, on response to Jean's question, I
sort of got the idea that the President learned about Mr. Pitt's
request this morning through the newspaper; is that correct?
MR. FLEISCHER: He made the request first to the Congress, that's
correct.
Q Did the President learn about it this morning reading the
newspaper?
MR. FLEISCHER: That's correct.
Q And second, could you tell us what the President thinks of the
idea being floated about holding an economic summit at some point?
MR. FLEISCHER: I'm not familiar with the idea. Economic summit?
You mean, like the G-7 meeting the President just had in Canada?
Q No, sir, a domestic economic summit. I mean, Gephardt has
floated this idea, so have some others, about getting economic thinkers
together.
MR. FLEISCHER: Well, there was a mini economic summit held this
morning here at the White House when the President met with Leader
Daschle and Leader Gephardt and Leader Lott and with Leader --
Speaker Hastert where the President asked the Congress to finish its
economic business, to send to him trade promotion authority and, of
course, I mentioned terrorism insurance is pending on the Hill.
The Congress has in its hands right now many of the tools necessary
to get the economy growing even stronger. And the President is asking
Congress to finish its work on those tools and send them to him, so he
can apply them.
Campbell.
Q Ari, you said a few minutes ago that it was the policy of this
administration not to comment on the day-to-day fluctuations in the
market. But on Monday, the President did exactly that; he was fairly
specific. Was that a mistake?
MR. FLEISCHER: The President commented on the fundamentals in the
economy; he didn't say anything about markets ups or downs.
Q Yes, he did. It was the day of the WorldCom bankruptcy and he
said that he didn't believe that the bankruptcy was going to affect the
market because the market had already adjusted for it. That's not
commenting on --
MR. FLEISCHER: The comment is -- the market was up today, I was
told, and the comment was, do you have any comments on the market being
up. That was the issue.
Q Ari?
MR. FLEISCHER: Lester.
Q In your answer to the question as to why the President wanted
airline pilots disarmed, you said, "because he's been listening to the
experts" -- who you didn't identify. And my first question is how
many experts did the President listen to besides John Magaw, who the
Washington Post and the New York Times both reported was fired?
MR. FLEISCHER: The President is going to listen to the experts
that work for the Department of Transportation, who report through the
Secretary. And the President has always indicated that his focus is on
safety. And I indicated just what Secretary Mineta said yesterday.
Q Ari, on Friday, the Deputy Chairman of the Republican National
Committee, Jack Oliver, sent out a widely circulated email saying,
"It's time for Democrats to put their partisan stonewalling aside and
help pass real corporate reform. Make sure your community knows about
the Democrats hypocrisy by calling your local talk radio shows today.
Call talk radio today." The President doesn't disagree with that, does
he, Ari? (Laughter.)
MR. FLEISCHER: Let me guess, do you work for a talk radio
station?
Q Several.
MR. FLEISCHER: The only thing you're missing is your 800 number
dangling around your neck.
Q I mean, would he add the Internet -- check the Internet, as
well as talk radio? (Laughter.) Would he, Ari?
MR. FLEISCHER: You know, Lester, I just -- maybe, maybe not.
Q Maybe, maybe not? Thank you, Ari.
MR. FLEISCHER: Thank you.
END 1:20 P.M. EDT
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