Press Gaggle by Press Secretary Jay Carney

Aboard Air Force One
En Route Newport News, Virginia

11:39 A.M. EST

MR. CARNEY: Hello. Good morning, ladies and gentlemen. Thank you for being aboard Air Force One with us today as we make our way to Newport News, Virginia. As you know, the President will be visiting Newport News Shipbuilding, a division of Huntington Ingalls Industries, where he will discuss the impacts on the defense industry and the Virginia economy if congressional Republicans fail to compromise to avert the sequester.

As I think you know, in the information that we provided you it makes clear that HII, in this case, the company that runs Newport News Shipbuilding, engages with suppliers, small businesses across the country that would be adversely affected by sequester. The President feels very strongly that for the sake of the people of Virginia and people who would be affected across the country, Republicans in Congress need to do what the American public overwhelmingly wants them to do, which is agree to a balanced approach to further reducing deficit. And you'll hear about that subject from the President in his remarks today.

Questions.

Q: Military officials in Afghanistan are correcting an incorrect report that the Taliban attacks dropped last year. Does that undercut the President's message that there are improvements happening in Afghanistan?

MR. CARNEY: The President has made clear repeatedly that as we draw down our forces and train up Afghan forces, we will turn over security lead to the Afghans progressively as we move towards the transition points that he has discussed and that NATO has committed to.

It has always been the case, and will remain the case, that this is hard work and it is not work that comes without occasional setbacks. I haven't seen the report that you've mentioned, but ultimately, thanks to the sacrifice of American men and women in uniform, as well as our diplomats, Afghanistan is increasingly capable of taking care of its own security and ultimately will be responsible for its own security. The President is committed to winding down that war and will keep to the timetable that he's announced with his NATO allies.

Q: Jay, is the President resigned to the sequestration cuts going into effect on Friday?

MR. CARNEY: I think you heard him say the other day that he remains hopeful, even though he understands that the clock is ticking and thus far, Republican leaders have refused to budge on the basic principle that we need to address this, our deficit challenges, in a balanced way.

We have on board, as you know, Congressman Rigell, who has said that he would like to see the sequester averted and that closing loopholes is a fair way to, in part, go about doing that. I think you saw Senator Lindsey Graham yesterday, late yesterday, on CNN talk about how he believes the damage of the sequester would be severe, especially to our defense interests, and that he would be open to a package of balanced deficit reduction that would include up to $600 billion in revenue from tax reform.

What's notable about that figure is that it's roughly what the President has put forward in his offer to Speaker Boehner and it's actually considerably less, $200 billion less, than the Speaker himself, as late as December of last year, just two months ago, said was his plan for contributing revenue to deficit reduction.

Q: Do those two folks that you mentioned give you folks hope that that's an actual breakthrough, or is that just -- are those just outliers in an otherwise intractable situation?

MR. CARNEY: Well, we'll have to see what the Republican leadership does. Unfortunately, on the other side of the ledger, we've seen comments, as we did from Congressman Pompeo, a Republican Congressman, that suggests a different course of action. He said it would be a home run politically for Republicans to see sequester implemented. I wonder if he would say that to the 90,000 Defense Department workers in Virginia who would see their pay cut because of furloughs, or the thousands of Virginians who would lose their jobs because of sequester if it were allowed to be implemented. We certainly don't think that's a home run for ordinary Americans, even if that Congressman thinks it would be for him politically.

Q: Jay, Senators Graham and McCain, our understanding is, are invited to the White House later today. Is that about immigration? Or is that about sequestration and defense?

MR. CARNEY: The meeting arose out of the President's telephone calls with Senator McCain -- I believe the telephone call with Senator McCain when he was calling members of the so-called Gang of Eight on immigration. Senator Graham also is a member of that. And I'm sure immigration will be a topic of conversation today. But I also expect, given the leading role that those Senators play in their party in the Senate that other topics will be addressed, including sequester. I think Senator Graham said yesterday in public in an interview that he hopes that sequester will be on the table as a topic of discussion. And I know that the President will want to discuss that as well.

Q: Why not Flake and Rubio, too?

MR. CARNEY: My understanding is this arose from a conversation with Senator McCain -- the meeting did. The President spoke with Senator Rubio, he spoke with other members of the Gang of Eight, including Democratic members, and looks forward to working with them on immigration reform. As I think Margaret points out, I think we expect more than one topic of conversation in this meeting.

Q: Are you hoping that there can be some real advancement or breakthrough on the sequestration front, given those two and the roles they play? And also, does the President plan on calling Boehner and McConnell back to the White House either before March 1st or at least by week's end?

MR. CARNEY: Well, I don't want to set any expectations with regards to a sequester. On this particular meeting I'm sure it will be a subject. Senator Graham has said he would like it to be. I know the President is interested in that subject. Immigration and other issues will be on the table, I'm sure.

The President has been engaged and will continue to be engaged with congressional leaders of both parties on the issue of the sequester. I don't have any meetings or phone calls to preview for you, but you can expect that he will continue to engage with them.

He will also, as he is today, go out and speak to the American people about these important issues. It's rather stunning to me that Republicans criticize the President for talking to the American people about the consequences of sequester, because the American people are the ones who will feel those consequences. Perhaps --

Q: They called it a roadshow.

MR. CARNEY: Well, they did, and I guess that maybe they are opposed to the President talking to the American people about sequester because the American people overwhelmingly support the President's position on how to reduce our deficit, and reject overwhelmingly the Republican position, which is placing the entire burden on senior citizens and middle-class families and the like.

The numbers could not be more stark, and setting aside public opinion, the policies could not be more different when it comes to balance and fairness.

Q: When you talked about Senator Graham speaking about being open to tax revenues yesterday, he also said, where's the President when it comes to overhaul of entitlement. And would that be a topic? Would there be a give-and-take? Do you think there would be an opening to negotiation on that today?

MR. CARNEY: Well, first of all, I'm not going to preview a meeting that hasn't taken place. And I'm simply reflecting what Senator Graham said he would like to be one of the topics of conversation, and representing for the President that he, of course, would be interested in talking about that. It's not a negotiation over sequester.

But when it comes to entitlement reform, I would remind you, as we made clear again last week and have repeatedly since December, the President's offer to the Speaker of the House remains on the table. That includes roughly $580 billion in revenue through tax reform -- again, short of what John Boehner said was possible, significantly short of what John Boehner said he supported back just a few short months ago. And it includes savings from entitlement reforms -- tough choices by Democrats as part of a broad, comprehensive deficit reduction package that would include tax reform that generated revenue.

The President has shown his commitment to entitlement reform, including the so-called superlative CPI change, as well as means-testing of Medicare benefits. These are -- these represent choices that are reflective of his willingness to compromise and Democrats' willingness and interest in compromise. What we haven't seen, unfortunately, from Republican leaders is anything like that commensurate level of -- anything commensurate with that level of compromise. We have not seen proposals from -- at least comprehensive proposals from Republicans that include revenue in the way that the President's proposals include savings from both discretionary spending and entitlements.

Back in December, the Speaker talked about that he could create -- he could produce $800 billion in revenue over 10 years from tax reform -- $800 billion from, to quote him, "the rich." He never put that on paper, but he said it again and again publicly. He said it was the right policy. And what we don't understand is why it was the right policy two months ago and now it's unacceptable policy for Speaker Boehner today.

Q: Jay, on that point, the White House keeps on saying that Boehner proposed this set of policies, but that would -- he was talking before the fiscal cliff deal, which already raised taxes. Wasn't he talking about -- you're talking about increasing the net tax burden -- he didn't want to do that, though. He wanted to reduce rates to get the $800 billion.

MR. CARNEY: No, no, no. He talked about a tax reform package that would contribute revenue to deficit reduction. I understand that they want to now do tax reform that is revenue-neutral. That is quite different from what we were talking about late last year.

And the fact of the matter is that including the fiscal cliff deal -- which included raising rates to Clinton-era levels for the wealthiest Americans -- income tax rates -- we have still seen deficit reduction that is made up of more than $2 in spending cuts for every dollar in revenues. That reflects balance. It reflects balance in favor of spending cuts signed into law by this President. What it doesn't reflect is the absolutist approach that Republicans have taken when we talk about the sequester or the need for further deficit reduction.

Q: One more question on the sequester. If it goes into effect and the Republicans don't compromise with you, that will mean the ratio of spending cuts to taxes will be three and a half or four to one in the end. Isn't that a defeat for the President if sequester stays?

MR. CARNEY: Sequester, if it's imposed, will be imposed because of a choice by the Republican leadership to reject balance in our deficit reduction efforts, to reject the overwhelming sentiment of the American people in favor of balance, and the consequences of sequester will be the result of that Republican choice.

There's no question that the President believes, as the Republicans once did, that the sequester is bad policy that should never be law, should never be implemented. That was the whole point of the sequester. And I can point you to numerous statements by Republican leaders about how sequester should be avoided at all costs.

Now we have a Republican congressmen saying sequester will be a home run for them politically -- although the political universe that he inhabits seems different from the general American public, the general American universe. And we see the Speaker of the House himself saying just a few weeks ago to the Wall Street Journal that he has sequester in his back pocket, and the Speaker in that interview also bragged about the fact that he had convinced fellow House Republicans to support implementation of the sequester.

Again, that kind of attitude ignores the impact that imposition of the sequester would have on the lives of average Americans here in Virginia and across the country.

I think we should all thank the pilot for that impressive landing. (Laughter.)

Q: Jay, is this Favreau and Tommy's last flight?

MR. CARNEY: It is. It's a sad day.

Q: Are they here because they --

MR. CARNEY: They are. There are and will be tears and gnashing of teeth.

END 11:52 A.M. EST