Press Briefing by Mike McCurry

The Briefing Room

1:57 P.M. EST

MR. MCCURRY: Well -- I'm trying to think if I had anything I needed to talk about today.

Q: What was Mexico's Foreign Minister doing here?

MR. MCCURRY: The Mexican Foreign Minister was here, as you might imagine, to get several pieces of our mind on the issue of General Gutierrez and the matter that you heard the President address earlier. He has made the rounds of several departments today; I understand he saw Under Secretary of State Peter Tarnoff, saw some of our counternarcotics people. He was here visiting with Mack McLarty.

Now, they had an agenda that also included discussions of the upcoming trip President Clinton will take to Mexico. But obviously, the United States government in very stiff terms described our unhappiness and our concern about corruption apparently reaching such high levels in the Mexican government.

Q: Was it because -- was he summoned here? And also, was their major complaint that Mexico did not tell us about this situation for two weeks?

MR. MCCURRY: I'm not going to get into all the details of the conversation. He was in town and had been scheduled to be here in connection with conversations about the upcoming meeting of the two Presidents. But it was an opportunity obviously for the government -- United States government -- to express our displeasure and the displeasure of the President about these developments.

Q: Did he meet with anybody else besides Mack McLarty?

MR. MCCURRY: I'm checking. Only, here, McLarty, to my knowledge. Do we have any of the other NSC directorate people there? David will check on that. I believe he may have had some other meetings, too. Someone at State had indicated that they thought he might have seen the Attorney General, and I haven't been able to check with Justice on that. But you can imagine that the message communicated was the same in all places. And the concern about the integrity of our law enforcement efforts and our mutual efforts to eradicate drug trafficking was top of the agenda and will certainly be a very key item on the agenda between the two Presidents.

Q: Well, are you saying you think that effort has been compromised?

MR. MCCURRY: I'm saying that we are assessing now what damage may have taken place with respect to our law enforcement efforts. That assessment will take some time, but we will work very quickly to repair any damage that exists and continue the war on drugs and drug trafficking.

Q: Did the Foreign Minister offer any assurances that --

MR. MCCURRY: Well, as the President indicated, we do have assurances from the highest levels of the Mexican government of full cooperation as we address our concerns about these matters and as we continue to fight drug trafficking.

Q: Did we have any independent knowledge of this or did it come only from the Mexican government?

MR. MCCURRY: I'm not in a position to get into the sequence of our understandings about this. Some of that involves intelligence matters I'm just not prepared to talk about here.

Q: How much concern is there of damage that may have been done during the time after he was detained -- went through at that point but could have been prevented if the United States had known that he was being detained?

MR. MCCURRY: That's exactly the kind of assessment that they will make as they look at what compromise, if any, occurred to law enforcement efforts. It's impossible to say at this point of what level of damage was done and when it was done. That's what they're assessing.

David, what's Jim's title?

MR. JOHNSON: He's the Senior Director for Inter-American affairs.

MR. MCCURRY: That's right. Also attending that meeting was the NSC Senior Director for Inter-American Affairs, James Dobbins.

Q: Mike, you said it's going to take some time to assess the damage, but they're up next week for recertification. Is that going to be put off while you assess the damage or --

MR. MCCURRY: I'm not aware that the State Department has made any change in its plan. But we get the recommendations from State and they have not come here yet. On how this will affect their deliberations, I can't say. The President had some thoughts on that, as you know, earlier today.

Q: Mike, it wasn't all that long ago that General McCaffrey described Gutierrez as a guy with impeccable integrity.

MR. MCCURRY: That's exactly why this is such a deeply disappointing and troubling development.

Q: Why the miscalculation?

MR. MCCURRY: Well, I can't address that subject on behalf of General McCaffrey, but the assessment of him and the reputation that he had was not consistent with these developments, to be sure.

Q: Mike, you suggested earlier this morning that you might give us a little bit more about the broader issue of possible intelligence failures on both this score and the Chinese connection to the fundraising.

MR. MCCURRY: I'm not in a position to do that.

Q: Mike, I have a question and a follow-up. As far as you know, are the facts in that Wall Street Journal article this morning about Paraguay accurate?

MR. MCCURRY: I don't -- I can't go back and look at --I mean, I can't vouch for every single fact. I think the general thrust of what was reported was accurate, that this individual, Mark Jimenez, who had information that he brought to the attention of the White House did -- we corroborated that information through a variety of ways, and then working within the international community and specifically with the Organization of American States, did take steps to avert a possible coup in Paraguay. That was very well reported at the time, but we do believe that the information that Mr. Jimenez provided was helpful in helping us become more alert to the situation.

Q: What was not reported at the time was the fact that at the exact same time he made a $100,000 contribution to the DNC.

MR. MCCURRY: Well, his contributions were duly reported and disclosed as they were required to be.

Q: Mike, did the convicted stock swindler, Eric Wynn, or any of his surrogates, like Mr. Mays, broach the subject of a pardon with the President or any administration aides?

MR. MCCURRY: The President is very certain in having no recollection of any such discussion.

Q: Well, was there anybody else that might have been approached that you know of regarding a pardon?

MR. MCCURRY: I don't know who Mr. Wynn or his representatives may have approached. The only person that I was asked about was the President.

Q: But you don't know of any other people that may have been asked by Wynn or Mr. Mays?

MR. MCCURRY: I'm not aware of the request going to anyone else, and obviously, the President would not entertain such a request himself and did not entertain such a request. There's a procedure that is available, and in the course of pursuing whatever legal rights he has, he may have approached people in the legal community, but I just don't have any information about who he might have approached.

Q: Mike, but he did meet the President at that fundraiser?

MR. MCCURRY: The President doesn't have any recollection of having any substantive private meeting with him. It was a very crowded -- that particular event in March was a very crowded event; the President went from room to room and could easily have encountered him during the course of that, but the President doesn't have any recollection of having a specific conversation with him.

Q: Mike, I never got to ask my follow -- I'm sorry. Was Jimenez solicited for a contribution when he came to the White House to meet the President on Paraguay?

MR. MCCURRY: No, because we do not solicit contributions here at the White House.

Q: -- solicited within a day or two -- the contribution was the exact same day and I'm trying to see if there was any linkage at all. I'm trying to ask the questions broadly --

MR. MCCURRY: The President and we here at the White House do not solicit contributions, so you need to ask the Democratic National Committee that question. And I don't know the answer to that.

Q: Mike, could you release to us the Office of Legal Counsel opinion that says it's okay -- the Reagan administration one that says it's okay for DNC people and local party people --

MR. MCCURRY: I'm looking into whether I can.

Q: And also, could you tell me, does that also, whether or not it says anyone other than DNC people could work here? For example, could someone from a union or a private company, something like that -- what's the understanding?

MR. MCCURRY: The memo -- I have only had a chance to glance at it. It's a Reagan White House era document and it does deal with the question of who can fund employment opportunities at the White House. And a number do. We have a White House Fellows program; we have outside organizations, think tanks and others occasionally will provide compensation to individuals who are here on some type of volunteer assignment, consistent with the Justice Department's interpretation of the law.

Q: Do you know what year that was done and who the --

MR. MCCURRY: I don't. It was done within the Office of the Legal Counsel at Justice. There was an initial opinion in 1982, and then apparently, as near as we can tell from the document, the Reagan administration requested another interpretation and received one in 1987. Correct?

Q: And when do you think you'll get back to us on when that letter might be released?

MR. MCCURRY: When I have an answer.

Q: Do you have the request, Mike, the request to the Justice Department for that ruling, whatever it's called?

MR. MCCURRY: The request that was initiated by the Reagan White House in the 1980s? No, we do not have that, and apparently would not have that in our records. Correct?

Q: Mike, what is the official White House explanation for why you would have full-time volunteers working at the White House over a number of years, yet paid by the DNC?

MR. MCCURRY: Well, it's a practice that has occurred at previous White Houses, apparently; individuals from outside organizations who were given an opportunity to the White House, subject to all the same requirements that exist for White House employment, i.e., the same separation of political and official duties, the same type of requirements to meet background checks and conditions of suitability for employment that apply to anyone who works here.

It's a practice that clearly was reviewed and deemed to be legal in the 1980s. The President asked the question that you just asked this morning and said, well, why did we have that practice in place, and asked that the Office of Legal Counsel here and the Chief of Staff review the appropriateness of having those type of employment arrangements.

Q: And did -- if I can follow up -- did it strike anybody here that it would at least lend the appearance of a conflict of interest?

MR. MCCURRY: A conflict of interest is a legal term. I'm not sure what conflict would arise from that appointment. The specific duties that would have to be performed by an individual here would prohibit them from working on political matters that would be prohibited under either the Hatch Act or under our own restrictions on doing political work.

Q: I think a conflict of -- or at least the appearance of a conflict of interest might arise out of somebody who owes their allegiance to their employer. Now, who was the employer? The White House or the DNC?

MR. MCCURRY: They have to meet the employment conditions established by the White House, but as other volunteers do who are compensated by other organizations who are here, their ultimate allegiance when they're here has to be to the President that they are serving.

Q: When you said the President asked about it this morning, was he concerned about it or did he have any opinion about whether he thought it was improper?

MR. MCCURRY: He wanted to know more about it, wanted to know what types of duties were assigned to the various people who have had these employments conditions over time, asked for a review of it by the Chief of Staff and by the Legal Counsel.

Q: Mike, do you have a sense of how many people have fit into this category in the first administration? And did their presence here have anything to do with an attempt to downsize?

MR. MCCURRY: I think it's safe to say that these employment arrangements were made in the context of trying to meet the 25 percent staff cut ordered by the President. And the total number, my understanding is probably in the neighborhood of 20. We don't have an exact number yet. There are four currently involved and probably at any one point, no more than just over a dozen.

Q: That's 20 with DNC salaries?

MR. MCCURRY: Correct.

Q: Not 20 with --

MR. MCCURRY: Twenty that had this arrangement where the DNC was picking up salary costs.

Q: Are they still on?

MR. MCCURRY: There are four currently who got that arrangement.

Q: You may not know this, but Congressman David McIntosh has written a letter today to --

MR. MCCURRY: I'm sure you could have it before we would, but why don't you tell me about it.

Q: He says that he's very concerned about the fact that at least one of these volunteers had access to the White House office database.

MR. MCCURRY: Well, my understanding is that the person referenced in the NBC report last night had minimal use of this and, consistent with the restrictions on use, did not share the information outside the White House -- I'm told by Counsel. Is that correct?

Q: I'm sorry, how do they know that?

MR. MCCURRY: Say it again?

Q: How is that known?

MR. MCCURRY: Well, they asked -- I mean, the Office of Legal Counsel had contact with the individual.

Q: Mike, there's a good chance that Senator Glenn will announce his retirement today. You used to work with him. Can you tell us what you used to do with him -- (laughter) -- and what are your feelings on this occasion?

MR. MCCURRY: I continued my somewhat blemished record in failing to elect candidates for President, to be precise. No, I served as his -- I can't remember -- I think I was sort of the Assistant Press Secretary. That was my function in the Glenn campaign in 1984 and traveled with him a lot. I spent a fair amount of time with the Senator and with Annie Glenn, both of whom I admire, as I think most Americans do. He is a truly fine person as well as an American hero, an American patriot. And it was a privilege and an honor to serve in what was ultimately an unsuccessful, but very enjoyable, presidential campaign.

Q: Mike, did you find out the extent of the e-mail threats directed towards the White House?

MR. MCCURRY: I looked into that a little bit. Look, as a general matter, we just don't talk about people who try to disrupt our e-mail or our computer capabilities here at the White House because we don't want to give these creeps any more attention. They don't deserve it, and they shouldn't be doing what they're doing to begin with. We are adequately protected. We have good security measures in place. And from time to time, if people try to make some type of threat or if they actually try to do something, we're pretty confident we can detect it and protect our system.

Q: Well, is it referred to the Secret Service when it happens?

MR. MCCURRY: This is -- I don't believe involves -- unless it -- it's not referred unless it involves some physical threat to the President.

Q: Mike, of those 20 or so people who are paid by the DNC, but worked here as volunteers, do you know what the length of their employment would have been for --

MR. MCCURRY: I can assume each and every case may have been different. I just don't know that.

Q: Was it just for a couple of weeks or -- like some of these were for almost three years.

MR. MCCURRY: I think there were different durations for some, but there were some clearly who were here on an extended stay under that arrangement.

Q: What duties did they -- range of duties did they perform?

MR. MCCURRY: Some were in the Schedule Advance Operations, some in the Public Liaison Office, some in the Political Affairs Office, some in the Office of the Vice President.

Q: The four now -- still here, what are their duties?

MR. MCCURRY: One is in Public Liaison, and one is -- two are in the Office of Vice President, and one is in Scheduling and Advance.

Q: Doing what for the Vice President's Office?

MR. MCCURRY: Doing I don't know. Do you know?

MR. TOIV: One of them -- is scheduling and advance. And I think one does liaison work for the Vice President.

MR. MCCURRY: I think one has a liaison role and one has a scheduling and advance role.

Q: If their participation and presence here is part of an attempt to satisfy the 25 percent staff cut, does that mean that it was part of a plan to try to find people and to try to find funding? Or is the White House more passive in this -- that the opportunity arrives and the White House jumps ON it?

MR. MCCURRY: Well, I think, in this case, they were trying to get the job done and they attempted to find ways to make salary arrangements available for those who were going to be here in this capacity.

Q: So that would suggest that the White House needed the position filled and sought funding and would have approached the DNC to see if they would pay?

MR. MCCURRY: I don't know whether we approached them or how the -- that basically, probably is the way it worked.

MR. TOIV: Every case is probably different.

MR. MCCURRY: Each case was probably different and negotiated differently depending on who the individual was.

Q: Were any of them on the DNC payroll before they came as volunteers or were they made DNC employees as a result of their volunteer work here?

MR. MCCURRY: I don't know the answer to that. Do you know? We'd have to check with each individual.

MR. TOIV: For the most part, they were not at DNC. There may have been one or two that were, though.

MR. MCCURRY: Most of it -- it appears to be that the case is more likely that it was the DNC picked up the funding for the slot.

Q: Why were they paid if they were volunteers? (Laughter.)

MR. MCCURRY: Well, they were paid -- I mean, they were -- that's how they're called. They're technically called volunteer employees, but it works in practice pretty much like a detailee from another government agency.

Q: What do you know about those who -- do you know for sure that the Reagan administration or Bush administration did, in fact, have employees paid by the RNC?

MR. MCCURRY: I don't know factually what they did, but it's clear from the memo traffic that they sought the opinions in order to do that. Now, the extent to which they did it or how many or what the terms were, whether it was short duration, or whether it was only scheduling and advance assignments that they were looking to fill, we just don't know and we don't have records available on that. Correct?

Q: What's the purpose of the review that the President asked?

MR. MCCURRY: Let's look and see if, one, if we're satisfied in the interpretation that was delivered by the Justice Department back in the 1980s concerning the practice, and two, whether it's a smart practice. I think there is -- both the President and the Vice President had some questions about whether it would be suitable to have certain types of people doing certain types of functions here depending on -- given what their assignments were.

Q: Who had the right to decide? I mean, who made the decision, let's have this person be paid by the DNC?

MR. MCCURRY: I don't know the answer to that.

Q: I'm curious as to what the whole process says about the downsizing of the White House. It sounds as though --

MR. MCCURRY: It sounds like there was more work to do than the downsizing would have allowed. I'd have to look -- I don't know where the overall numbers are. I mean, there are a lot of volunteers who work here in different capacity. I mean, if you go to our correspondence unit, we get a lot of help from people who are there. We get interns who are here basically unpaid as volunteers. So there has been a general practice of having work done by volunteers -- in this case, by people who are being paid by outside entities. And that practice has been around at the White House in the past.

Q: Well, the implication of the statements of the President and Vice President almost sort of seem to be that there were fewer bodies here. It seems now as if the body count remains the same, you all have just been looking for the money somewhere else.

MR. MCCURRY: I don't know whether the body count remains the same or how this affects the overall total. Maybe Barry can work up some more on that.

Q: What kind of background checks were done on these DNC people?

MR. MCCURRY: I'm told that they are similar to those required of any White House employee. They had to meet the suitability determination for employment that anyone would have to meet if they were being put on the White House payroll. Yes, the same -- and they were given -- most of them were hard-pass holders, so they had to meet the same conditions of employment that go with having a hard pass.

Q: Mike, do you know specifically what the one person detailed to the Political Affairs Office is doing --

MR. MCCURRY: No.

Q: -- what their job was?

MR. MCCURRY: Don't know.

Q: Do you know the salary range here, what did the DNC pay them?

MR. MCCURRY: I do not know. But we can get that because that is, presumably, reported by the -- reported to the Federal Election Commission by the DNC.

Q: Do you know were these minimal salaries or were they --

MR. MCCURRY: I think mid -- I don't want to guess. We would just be guessing. I mean, the individuals involved I would not describe as being the senior most level employees at the White House. They were less senior.

Q: What is the status of the 25 percent --

MR. MCCURRY: That's obviously a good question and we're going to follow up, as I just said.

Q: Did the President know about the existence of DNC paid employees?

MR. MCCURRY: He didn't appear to, to me, when it came up this morning.

Q: I apologize if I'm asking you to repeat, but insofar as the memos, the original legal opinion by the Department of Justice --

MR. MCCURRY: Yes -- asked and answered.

Q: Can we see it?

MR. MCCURRY: Asked and answered.

Q: I didn't hear it.

MR. MCCURRY: I said I'm going to look into it.

Q: Speaking of some of your former bosses, today Senator Moynihan called for an independent counsel to look into the overall fundraising -- not you, does the White House have --

MR. MCCURRY: The White House doesn't have any comment on that.

Q: A Scandinavian journalist told me today that some people in Norway and Sweden are scratching their heads in envy about why the President decided to go to Denmark and not their country. Why did the President pick Denmark to go to?

MR. MCCURRY: There was something connected with -- it was the Queen -- it was a hard choice. I think there are a number of places that the President would have wanted to go. Let me go back to this. I thought there was a commemorative event involving Queen Margrethe, but there isn't. He obviously looks forward to seeing her. They will have a good range of bilateral discussions with the Prime Minister, Prime Minister Rasmussen, and a number of issues related to the future of Europe integration, with a very valued bilateral partner.

Q: Is that the only country he's adding on?

MR. MCCURRY: The only one I'm aware of. But there are many places we would have liked to go, and indeed, one day may be able to go to.

Q: Mike, do you know who specifically recommended John Huang for the Commerce Department job and then recommended him to go into the DNC?

MR. MCCURRY: A long time ago I looked at those -- actually, on both of those matters we've provided extensive information to news organizations that have made inquiries and it's a story that has multiple parts to it. Lanny Davis is probably in a good position to go back and reconstruct that, but if you go through some of the stories about Mr. Huang that have been written by various news organizations, that's been fairly well detailed and we've provided the information about that.

Q: When Director Raines presented the budget he said that there would be automatic cuts in programs if budget targets weren't met. I believe a letter is coming from the Hill asking him to specify what programs these are. Will you tell us what programs would be cut?

MR. MCCURRY: We are going to send that letter up to the Hill, and my strong suspicion is it will be public very shortly thereafter. It's not ready yet, apparently, and they're looking at it. These are in some cases, Larry Haas tells me -- although I'm advised to tell you, please don't call Larry because there's nothing more he will be able to tell you -- (laughter) -- than what I am saying right now. Thank you, Larry. Thank you, Mike.

And don't hassle them either, because -- anyhow a lot of these are itemized projects that are even small enough that they don't show up in the appendix to the budget that we just released. So they're working now with individual agencies, identifying those, getting project descriptions and, in some cases, program descriptions. Then that material will be batched together, sent up to the Hill and someone will be kind enough to leak it shortly thereafter.

Q: Not whole Departments or anything like that?

MR. MCCURRY: No, no, no. These are a range of things and, in some cases, only involving tens of thousands of dollars.

Q: What can you tell us about the D.C. thing?

MR. MCCURRY: I'll do that in a minute. John, did you want to --

Q: Yes, I had a question, just general reaction to the Post story about John Huang today. Is the White House concerned, more deeply concerned --

MR. MCCURRY: Look, there are allegations contained in that story that are surprising, troubling, and, in the President's view, items that obviously should be investigated. We would presume that they are, but I can't speak for those who are looking into those matters at the Justice Department.

Q: Did you discuss it with him today?

Q: Is the President closer to feeling that there should be an independent counsel appointed?

MR. MCCURRY: We have no comment on that.

Q: Did you discuss it with him today, these allegations -- with the President, did you discuss it?

MR. MCCURRY: I alerted him to the story.

Q: And his reaction?

MR. MCCURRY: The one that I just gave.

Q: Was anybody at the White House -- there were stories just this week that said that the DNC had raised flags on John Huang. Were those flags waved down here at the White House? Did they give you -- anybody at the White House a heads-up that there was some troubling developments involving Mr. Huang?

MR. MCCURRY: Not that I am aware of, but I imagine that's a matter that would require greater checking, and I'll attempt to do that.

Q: Mike, has the President -- is he distancing himself from Mr. Huang? I mean, they used to be acquaintances, if not more than that. I mean, has he spoken with him, met with him? Is he --

MR. MCCURRY: He's not had any contact with him that I am aware of for quite some time.

Q: Is that deliberate?

MR. MCCURRY: I think it's advisable.

Q: Senator Johnson of South Dakota, one of the four freshman senators who's been undecided on the balanced budget amendment, is expected to be giving a new conference, I think even as we speak, in South Dakota, says he's going to come out against it. Would you welcome that?

MR. MCCURRY: The President has very strong views on balancing the budget and wants to do it and get it done as quickly as possible. You know that he's expressed his concerns and his objections to a constitutional amendment, so obviously a courageous stand by Senator Johnston on that matter would be most welcome.

Q: Do you have any advice for Senator Torricelli or -- in terms of their vote tomorrow?

MR. MCCURRY: It's a very warm, positive statement we just gave to one of their colleagues who's about to take a tough stand and a courageous choice, because it's right for the economy, it's right for the interests of all of those who want to get on with the job of balancing the budget. But I'm sure that the good Senator is in a position to make judgments like that on his own.

You want to do the District stuff? First of all, we're doing a lot in the District tomorrow and, most importantly, the President and the First Lady -- and is daughter going, too? -- are going to go out -- just the President and the First Lady are going to go out and see if Scottie Pippen can score 47 points again. So they're going to go to the Bulls game tomorrow. I'm advising you of that because Bullets fans are going to encounter some security delays, no doubt, at the U.S. Air Arena tomorrow. So we just want to make sure people are prepared for that.

Q: Just the First Lady and Chelsea?

MR. MCCURRY: No, just the President and the First Lady are going to go out. The First Lady went, I guess, last time -- watched last night's game.

Q: Is that the D.C. event?

MR. MCCURRY: No, no, no, I just didn't -- that's the end of a day in which there will be a lot of focus on the District.

The President tomorrow is looking forward to meeting with folks in the District who are helping kids learn to read. He's going to have some, we think, impressive things to share about efforts to bolster student work study opportunities for reading, tutoring. And the President obviously will use that occasion to talk about our national literacy challenge and our effort to help kids meet the standard of being able to read by 3rd grade. It's a national issue with very real practical implications here in the District.

Q: Where is this going to be? A school?

MR. MCCURRY: We'll give out the schedule info.

Q: So he's not going to make any announcement of tax relief or anything?

MR. MCCURRY: We have a very comprehensive review that's occurring this evening of where we are on various parts of our District initiative, including the economic development aspects, all the different things involved with the swaps. We've been having ongoing conversations with District officials who have been here from time to time in connection with the understandings that we need to reach with the District if they're to take on some of the responsibilities that will be shifted to them in exchange for us swapping out some of the responsibilities we would take under our D.C. plan. And those discussion have been going very well, I'm told.

Q: What's happening tonight?

MR. MCCURRY: We just have a little -- I did it in the gaggle, John -- we have a little team review. The D.C. Task Force is having a review with the President on where we are on various aspects of the D.C package tonight. Nothing we will talk about very much afterwards.

Q: Mike, just to follow on the President's event tomorrow. There may be a cynic or two out there saying, why are you going to pay college students to do something they ought to be doing on their own?

MR. MCCURRY: These are work-study students, and so they're going to be doing some form of employment, and this is a very valued one. We would, obviously, hope there will be additional -- because our literacy challenge foresees it -- additional volunteers who are out in communities helping kids learn to read, in addition to using the tool available through the work-study program.

Q: I'm curious, is there any plan to expand the President's program -- I know he wants to take -- but in light of The Washington Post stories this week that illustrates the D.C. school system is in complete collapse, would that be another option?

MR. MCCURRY: We have been working on a national effort to help schools that are in need of infrastructure repairs. The principal federal role is, of course, providing assistance for schools that are in need of funding for repairs in reconstruction. Schools are still matters of local administration, and I think that's the way most Americans want it. And our program has been carefully designed to take on those responsibilities from the District that we think are proper federal responsibilities.

Q: Any reaction to the arraignment of the Georgian diplomat today in court?

MR. MCCURRY: He was arraigned in court today? The Georgian government did waive immunity; we welcome that. We hope that those responsible for this death are prosecuted to the fullest extent the law provides.

Q: Mike, could I try one more on the District? For some time the President has been talking about a greater personal involvement. Does tomorrow's appearance somehow symbolize a concern that goes beyond the city school issue?

MR. MCCURRY: Oh, absolutely. The President and the First Lady, too, if you read her column today that is carried in The Washington Times, where it's proudly set forth and available for all to read, something edible in the food chain -- (laughter). And we're very grateful to The Washington Times for publishing the First Lady's comments. But she has a column today about the District and talks about the need for folks to be more engaged. I think in the course of the next two months, you'll see the President, the Vice President, other members of the Cabinet, people in the administration very actively involved in aspects of the effort to make this a fine capital city.

The President has got some plans to do additional things as we move through aspects of his initiative and advance it on the Hill, things that he can do personally in the District. The First Lady clearly, as you know, just last week was in the community. And the President does want to be more actively engaged in the community in doing the work necessary to restore a real bright shine to this city.

Q: Has he consulted with Barry at all, the Mayor?

MR. MCCURRY: The Mayor has been here -- I don't know if he's seen the President directly, but the Mayor has been part of the ongoing discussions we've had with the leadership of the city, specifically with respect to the memorandum of understanding we're attempting to formalize with the District. But there's been ongoing conversations with him. I believe he will be at the event tomorrow, too.

Q: Are city or control people, control board people coming tonight, or is this strictly administrative?

MR. MCCURRY: This is an internal meeting, John, just so that we -- we want to talk a little bit tomorrow about the initiative and where we are. And the President wanted an update from Director Raines and the team on where various aspects of the initiative stand at this point. And Frank is prepared to give him a good report.

Q: Mike, just to be clear, that meeting doesn't include the issue of tax relief, it's just on the package that was announced about a month ago?

MR. MCCURRY: Well, it's on -- they'll look at the proposal for the economic development corporation and talk about some of the ideas that are being developed with respect to that. Now, we project ahead sometime next month, maybe saying more specifically about aspects of the EDC and how that would stimulate investment in the city. I mean, we've got a budgeted amount that's there in the FY '98 budget proposal, but I think Congress especially is looking for a little more clarity on exactly how we would structure the tax benefits that might be available. And we'll have some ideas on that. Obviously, the commuter tax concept is not something that is making much headway here, but there are some ideas about stimulating investment and how you use and structure tax incentives so that they can be useful.

Q: Mike, in the course of the President's economic briefing this morning, do you know whether he discussed with his team where they are on the Fed vacancies?

MR. MCCURRY: He did not, but I checked on it. They've got a good process underway. In fact, the President did ask Erskine Bowles this morning what the status of the search for possible replacements are. The President was told that they're down to a short list. They're continuing to interview candidates.

The economic team has been very heavily engaged in recent weeks on the budget -- the presentation of the budget and the annual economic report. So they've now begun working a little more rapidly on Fed vacancies, but the President has not received an final recommendations. The President got that update before -- I guess just after the economic briefing you had. So, clearly, that did come up then.

Q: Do you know how short the short list is?

MR. MCCURRY: They don't have it -- they've got a range of candidates, but they haven't narrowed it down to a short list for the President at this point.

Q: Mike, talking about diplomacy, do you think the U.S. and India are in a diplomatic war? Because two diplomats, U.S. diplomats were expelled from New Delhi and the same thing the U.S. did from San Francisco and Chicago.

MR. MCCURRY: This is a matter that was handled correctly, handled appropriately and in our view should not impede the good relations we have with the government of India.

Q: Mike, do you have any sense when the President's working group in financial markets might be done with its work and make a decision on whether or not interest --

MR. MCCURRY: Okay, let's quiz the staff. Who here knew he had such a working group? (Laughter.) Okay, how many of you knew he had this working group? I think I better go check on that one. Actually, believe it or not, I saw something just about that the other day, but I don't think it was an update on where they are.

MS. GLYNN: I think it was in the paper.

MR. MCCURRY: There was some -- yes, that's right, there was an article in the paper somewhere about it. I don't know. I'd have to check on it. I don't know the update.

THE PRESS: Thank you.

MR. MCCURRY: Thank you.

END 2:35 P.M. EST