Press Briefing by Deputy Chief of Staff Maria Echaveste, Small Business Administrator Aida Alvarez, and Rebecca Blank of the Council of Economic Advisors

The Briefing Room

12:43 P.M. EDT

MS. WEISS: Good afternoon. I'm Amy Weiss. Today the President will be holding his final meeting with his Race Advisory Board and will, among other things, thank them for the work over the past 15 months. Maria Echaveste, White House Deputy Chief of Staff, who has overall White House responsibility for the initiative, will give you an overview of the President's Initiative on Race. Aida Alvarez, the head of the Small Business Administration, will be outlining the SBA loan program the President will be talking about today. Also joining us will be Rebecca Blank of the Council of Economic Advisors. The President will be releasing a CEA report today, which you should all have already.

The Oval Office board meeting scheduled for 2:00 p.m. this afternoon will be transcribed and a print pooler will be available in the room for you as well.

Maria.

MS. ECHAVESTE: I'm just going to take a couple of minutes to tell you what we're doing today. This really represents this final board meeting, sort of the conclusion of the first phase of the President's Initiative on Race. The board will be meeting with the President and summarizing, giving him highlights of what they've learned this last year.

I think our view, as we've tried to express over this last year, is that race is highly complicated, probably the most perplexing question facing our country, and therefore very difficult to solve in a year, and we never had that expectation. I think the number one goal the President had was to use the fact that we were in a time of prosperity and calm to really put this issue on the national agenda, and I think we've succeeded.

In fact -- well, I won't go so far as to say that the President's initiative is responsible for the following. I did just learn today that the Columbia School of Journalism will be partnering with the Ford Foundation on a program on journalism, race, and ethnicity that will be launched next year -- they're in the planning stages now -- to really increase coverage of race and ethnicity by all of you. I think that suggests that there's going to be a lot of work in this area and it's definitely front and center.

The other thing we'll be doing -- you'll hear from Aida Alvarez on the SBA announcement -- is that during the course of this year, we used the opportunity -- the fact that we were focused on race to look for ways in which you could take policy action, and that ranged from the President's effort to put education front and center and look at the disparities and educational achievement that led to the High Hopes initiative, which we're not having much success passing in Congress, but really was an effort to really target minority children, low-income children, and create expectations that they, too, can go to college.

The President announced several months ago a request for $400 million to look at racial disparities in health. You're going to hear from Becky Blank on, really, the facts about disparities among the races. And this work will continue. There are two pieces at the moment that we've scheduled, but the President, as he said on Wednesday, is going to continue focusing on race.

There will be a conference in October. We have been working with the National Research Council, the National Academy of Sciences, papers have been commissioned to really look at social science research so we can have more data and more information. The President's Report, we've already started working on that. We expect to have that out late winter.

This will really be the President's effort to communicate to the American public sort of what he thinks about the issue of race, how he thinks we should tackle it; it should include a work plan for the nation and also look at the promising practices, which the board spent a lot of time -- something very reassuring, actually -- that all over this country there are people really trying to reach across racial divides and find ways to find issues of common interest and recognize that above everything else we're Americans.

So let me stop there. I'll be happy to answer some questions. But first I'll cede to Aida Alvarez.

ADMINISTRATOR ALVAREZ: Thank you, Maria. As you've heard, I'm the U.S. Small Business Administrator. The President, when he embarked upon the racial initiative and created the commission, was very much thinking about economic opportunity for minorities as an outcome. At the SBA that's really a part of our mission, and the announcement the President will make today will be of two programs that will result in an increase of $1 billion dollars in loans, which will primarily go to minorities and women.

We are taking two programs that have existed in a pilot form -- one of them actually was introduced by Erskine Bowles -- that's our SBA LOW-DOC program -- low documentation, which means one page of government paperwork -- and we are going to roll them out, big time.

That means that in the case of these programs, we will be able to basically guarantee at least 36 hours or shorter turnaround time that loans of $100,000 will be -- small businesses will be able to borrow up to $150,000 under these programs and do it directly in our SBA Express program from the banks; in the case of SBA Express, there will be no government paperwork whatsoever.

We think that this will have a dramatic impact. Many of these loans go to start up new businesses or young businesses, which is where we see the economic activity among women and minorities. So we think that the message of racial reconciliation will be very much strengthened by the announcement that we have a program that will result in $1 billion in loans to minority entrepreneurs.

MS. BLANK: I'm Rebecca Blank from the Council of Economic Advisors. We are releasing, this afternoon, our report Changing America: Indicators of Social and Economic Well-Being by Race and Hispanic Origin. One answer as to why we did this report is that after 50 years of publishing the Economic Report of The President in black and white with the same typeface we used back in 1948, we wanted to show all of you we could actually think in color. It's multiple color. I hope you'll all look at it.

The chart book itself documents current differences in well-being by race and Hispanic origin, and describes how such differences have evolved over the past several decades. The book is designed to further one of the goals of the President's Initiative on Race: to educate Americans about the facts surrounding the issue of race in America. The chart book was produced for the President's Initiative on Race by the Council of Economic Advisors, working in cooperation with the federal statistical agencies.

The book is particularly unique in the breadth of the indicators that it encompasses. It pulls together data on population, on education, on labor markets, on economic well-being, on health, on housing and neighborhoods, and on crime and criminal justice. And there is no other public documentation that pulls together that amount of information with current indicators, disparities, and differences by race available.

Whenever data are available, the differences are documented for the five most salient racial ethnic groups in America: non-Hispanic whites, non-Hispanic blacks, Asians, Hispanics, and American Indians. I should say the book provides a series of snapshots, and I encourage you to look at it. It's hard for me to sort of describe in any depth sort of the whole range of things that are here. I also should note that we have a web site available that is printed on the inside front cover of the book, which provides all of the data behind every chart. So if you don't like the way we plotted it and want to plot it yourself for an article that you're writing, feel free to pull it off and use the data in any way that you can.

The chart book itself demonstrates that race and ethnicity continue to be salient predictors of well-being in America. On the one hand, the American record over the past 50 years has been one of tremendous growth in such areas as education, health and longevity, and economic growth for all racial and ethnic groups. In some cases, as everyone has moved upwards, disparities have closed, but in too many cases disparities have remained constant or have even increased. Fundamentally, the data in this chart indicate that there is much more work ahead of us.

Q: A couple of months ago, they had the meeting across the street, and Chris Edley said that he wanted the Race Advisory Board to come up with a short list, like the top ten recommendations that they had for the President, and then give a longer laundry list, if you would. Are there issues that take precedence in this large report you're giving to the President?

MS. ECHAVESTE: Well, I think first and foremost they identified -- I guess the best way to put is, for those people who pay a lot of attention to race, what they recommended wasn't very surprising. But for a lot of America, I think particularly with the fact book, will point out that what really needs to be paid attention are things like education, economic opportunity.

But at the top of their list is really that this dialogue -- and I know it was criticized in some quarters, both on the left and the right, but the reality is that the President's Initiative on Race really made it possible for people to talk about race and ethnicity in a nonconfrontational, nonhostile way.

And I was at enough cocktail parties, et cetera, receptions, where the fact that the President had launched this campaign really caused people to look around themselves, look around their workplaces, look around their communities, and really start to ask the questions. So dialogue -- the President has not determined yet what kind of vehicle he will continue this work. We're exploring whether we'll have some White House staff dedicated over the next couple of years, whether there will be a President's Council on Race Relations. I think all of that, the President's going to be considering over the nest few months, and I think you'll see it in the race report.

Q: How would a President's Council on Race Relations differ from, say, the U.S. Commission on Civil Rights, which already has very similar responsibilities?

MS. ECHAVESTE: Well, I think that's exactly the kind of issue that needs to be grappled with. One of the things with the U.S. Commission on Civil Rights -- first, always battling to survive; two, bipartisan by law has actually, depending on who you talk to over there and depending on under what administration, either the Commission is able to really further work in terms of study and analysis, or is totally bogged down. So I think that when we look at this issue of a Council -- if that's the direction the President wants to go -- we're going to look very seriously to make that it doesn't run into those kinds of traps.

Q: Are you sorry or glad that Ward Connelly was excluded as he was by John Hope Franklin at the session meeting at the University of Maryland? And I have a follow-up.

MS. ECHAVESTE: I think what having the initiative really caused was it also provided a platform for folks who disagreed that race was an issue. And if you'll recall, one of the things we kept struggling with was that the initiative on race was much more than just about affirmative action. And if you were in the meetings that we had in December, the folks on the right seemed to always want to come back to that one issue. On the other hand, they went off to form their own committee. They're, as I understand, looking for to write their report, so the more the merrier.

Q: Would you recommend racial desegregation for the congressional Black Caucus?

MS. ECHAVESTE: I have no comment on that.

Q: You mean segregation should continue in some respects? No comment on that?

MS. ECHAVESTE: I have no idea really what you're talking about, so I haven't considered --

Q: That the Black Caucus is racially segregated --

MS. ECHAVESTE: Actually, I'm not sure but go ahead.

Q: They are.

Q: In discussions surrounding the racially passed legislation, Citizens Protection Act, which was passed by a large majority of the House of Representatives -- a bipartisan majority, as a matter of fact -- there was documentation that was put forward regarding predominantly black elected officials who had been elected to office but then found themselves in legal difficulties subject to a variety of scandals, which were being investigated by the Department of Justice and other arms of the judicial courts.

And this was a concern, that they were being targeted by portions of the bureaucracy to redo what the American public had done in electing them. I was wondering if that -- those aspects of the racial question in this discrimination within the institutions that is expressed in this kind of activity -- was a part of your deliberations in the commission?

MS. ECHAVESTE: Not specifically that question, which had to do with mayors of some key cities around the country, but certainly the issue of the criminal justice system and various experiences of different racial groups with that justice system, the fact that parts of our society have a very large distrust of the justice system and what we need to do about it when segments of our society do not believe in the fundamental structures was the subject of a meeting and is, well, one of the chapters in the advisory board's book.

Q: As far as race is concerned in America, so far, what have you found out, or the President, or what is the major problem, the race problem?

MS. ECHAVESTE: Well, I think the President is going to be talking about that this afternoon. We've given a lot of thought about how he sums up this last year and where he wants to take us. Probably one of the key things is that the issue of race and division is not unique to America, and you've heard him over and over in this last year as he rattles off the various places around the world where there's conflict that turns upon differences.

I think specifically for America he focuses a lot on opportunity, but says that absence of discrimination is not enough in terms of building our society. So it's got to be more than just opportunity; it has to be really recognizing the value of each one of us.

Q: Does it have something to do with slavery in the past?

MS. ECHAVESTE: I'm not sure -- you mean, the Advisory Board's report? I have to tell you, I know they've talked about that issue, but one of the things that the Advisory Board really tried to do -- and again, with limited success for a whole host of reasons, was to show that this dialogue, this initiative, was more than black and white, recognizing our historical burdens, but also the fact that our future was going to be decidedly diverse and much more than black and white.

Q: A question about the $1 billion for either you or Ms. Alvarez. Was that money that was proposed by the President's Race Advisory Board, or is it money you already intended to spend and it's money that simply furthers the objectives?

ADMINISTRATOR ALVAREZ: That's actually private sector dollars. This is -- what we do at the SBA is we guarantee loans. That allows the private sector to take risks in lending to small businesses. We believe that through SBA LOW-DOC and SBA Express, we will create -- we have basically expanded and improved these programs so that the private sector will be in a position to do as much as $1 billion of new loans to small businesses, and that our experience has shown us that smaller loans, loans of $150,000 or $100,000, tend to be loans made to minorities and women.

Q: Are there federal monies involved there in the guarantees?

ADMINISTRATOR ALVAREZ: It will be a part -- we have an appropriation that supports the subsidy, and it will not be an increase in our appropriation.

Q: I don't understand what the attachment to the President's Race Advisory Board is.

MS. ECHAVESTE: Let me get to that if I could, because what it is, is that through the initiative, what the President asked all of the Cabinet agencies was to look for, within their program areas, what they could do to promote opportunity, whether it was economic or educational or all of those things. And, indeed, the Advisory Board, at one of their meetings, talked about lack of access to capital. So I think they work in that way.

Q: Are you concerned, ma'am, about the lack of racial diversity in the very high-paying jobs in the team rosters of pro football and pro basketball?

MS. ECHAVESTE: Lack of diversity?

Q: Yes, there's not a single Chinese or Japanese American or American Indian halfback or linebacker in the NFL that I know of. Are you concerned about that, ma'am?

MS. ECHAVESTE: I'm not concerned about it, because -- in fact, I think we were widely criticized for having an ESPN town hall that looked at race in sports, but one of the reasons it seemed to be a good model was that that was one area where plain athletic ability seemed to determine whether you were on the team or not.

Q: But not at law school, not in anything less important like law school.

Q: What is your perception of the impact of the legal requirement for public meetings had on the advisory board's deliberations?

MS. ECHAVESTE: I think it chilled discussion. I think the Federal Advisory Committee Act, in the interest of making sure that the public has access to all deliberations, nonetheless meant that I think discussions were not as frank as they might otherwise have been, and I think it was a little debilitating. But that's the law, so we complied with it.

Q: Can I just follow up on that? Can you explain how having a print reporter at the meeting with the President today cures the requirement of the Federal Advisory Committee Act that the meeting be open?

MS. ECHAVESTE: No, there's a transcript. There will be a transcript -- it's being transcribed.

Q: But doesn't the law require that the meetings be open to the public?

MS. ECHAVESTE: No, no. We've gone through this with our lawyers -- so long as there's a transcript available.

Q: Why is there only one reporter there?

Q: One portion of the report mentions whether or not the main problem is race or poverty, and to a certain degree the report concludes it's both. Well, I'm just wondering in terms of any type of remedial action, if in a sense it's both, should any remedies be, or any mending of affirmative action include, say, poor whites who are disadvantaged as well as -- taking it on a means base rather than just on a racial base?

MS. ECHAVESTE: As Aida just said, the loans in terms of SBA certainly will be looking at and being much broader --

ADMINISTRATOR ALVAREZ: They're open to everyone.

MS. ECHAVESTE: They're open to everyone. And the whole question of government programs, looking at issues like economic as well as racial, I think. All of that's under discussion, particularly as various departments look at their own --

As you know, the government has been engaged in a thorough review of its -- compliance with Adarand. We're taking a look at the 8@ program over at SBA to make sure it's in compliance. And we continue to look at situations around the country.

Q: To what extent has the Lewinsky scandal thwarted your efforts?

MS. ECHAVESTE: Well, I would say that the Advisory Board continued to do its work. The staff went out there. There was a lot of activity. And the fact that some of you all didn't cover it didn't mean it didn't occur.

Q: But it also means Americans didn't hear it then.

MS. ECHAVESTE: Well, I think the advisory board and the staff -- I mean, when you look at what the initiative staff did, there was a tremendous amount of communication -- whether it was the campus days of dialogue in April, where hundreds of universities around the country had a day of really talking about race and ethnicity, or statewide days of dialogue, there were communities around the country for whom this was an important issue. And that galvanized communities to continue work.

We've had offers from mayors and clergymen. One of the things the President is going to talk about today is that the faith community, under the leadership of the National Conference -- what used to be National Conference of Christians and Jews -- they've changed the name -- Sandy Cloud will be heading up an effort to continue the faith community's involvement on race.

Q: Did it also detract from the President's ability to lead on the issue?

MS. ECHAVESTE: I don't think -- not at all.

Q: Time or attention or anything else?

MS. ECHAVESTE: The reason that the President went the route of having an advisory board and having an initiative staff was he recognized: one, that he would be too busy, with all the pressing matters that are on his plate, to be able to pay the kind of attention to go out there and really learn what was on people's minds and what they thought the issues were; and, two, recognized that own policy council staff would also be unable to delve deeply into these issues. And that's why the initiative, its first phase, was really sort of jump start -- okay, what do we know, what are people talking about, what can we do with this. And we're going into the next phase.

Q: The initiative labored for a long time under the public reputation that it was a well-intentioned exercise but also kind of a fuzzy one. And after this briefing, I'm still not sure I understand what the rejoinder to that is. Could you explain in your mind what you think the most concrete revelation about the racial problem is that was arrived at, and the most important sort of remedy toward that after this yearlong exercise?

MS. ECHAVESTE: Well, I still keep coming back to putting it on the national agenda as a concrete issue that this country has to face, whether it's because of Becky's facts, where you have these incredible disparities and where you really have to look at, is it race, is it poverty. And if it's both, what do you do?

A lot of people in this country at the time the President launched this initiative didn't think we needed to have this discussion. At a time when our population is becoming increasingly diverse and disparity is growing, if you will, that's dangerous. And that's why the President -- so I think that is a concrete thing the President did.

Secondly, in terms of remedies, what we learned, not surprisingly, is that it's extremely complicated and that one of, I think, the hardest parts was an expectation, I think from both the left and the right, that somehow the federal government was going to come up with sort of its blueprint for solving. And what we learned is it can't be done by the federal government; it just can't. It's state, local, it's community, it's faith, it's private sector. That's why things like the SBA -- and so that was important.

And lastly, I think it's the facts -- what are the facts -- because a lot of people just sort of deny that race is an issue; in reality, it still is.

Q: Do you think you raised expectations too much in the announcement of the -- and that people thought it was going to be magic?

MS. ECHAVESTE: I don't know if we've raised expectations too much. In a way, I think if you listen to the President this afternoon, one of the things that makes it both one of the most interesting things to work on and yet most frustrating is that it really has to do with almost moral values: how we think about each other, how we deal with each other. So in that way, it's a very lofty, almost exhilarating type of endeavor.

But then you have to get practical. What do you do with this? And I think that's what led to the frustration.

One last question.

Q: Maria, the conservatives came a couple of months ago and met with the President about their concerns, especially with the affirmative action issue. Did the President consult at all with some of the conservatives towards the end of this race initiative, or did they meet with the Race Advisory Board and Judy Winston?

MS. ECHAVESTE: Staff have met -- some of us have called and become best friends with some of those folks. But you have open lines of communication. I think there was a great meeting that the President had with a group organized out of the Hill, members of Congress, that's bipartisan, that really is an effort that's been -- I guess it's been several years -- that have been working on issues of race. And I think coming together as a country is not either a Democratic or a Republican agenda; it really is unifying.

Q: The slowing of the progress for black Americans since the mid-'70s has coincided largely with the advent of affirmative action and a lot of other types of assistance designed to help black Americans. Has the President reached any conclusions about affirmative action based on that, whether or not it's counterproductive or whether or not we need maybe even more of it?

MS. ECHAVESTE: The President has not. He has certainly made it clear that he continues to believe that programs like affirmative action for employment, for economic opportunity, for education are needed. But whether that's the sole way of addressing the disparities -- what we did hear from some people is that, in fact, affirmative action -- I heard this from some people on the left -- that affirmative action actually allowed society, all of us, to pretend that everything was okay, because there would be a few people who sort of made it and the rest of the sort of black community or Hispanic community or other impoverished communities, their issues would not be dealt with. And I think that's a very interesting twist on that debate.

THE PRESS: Thank you.

END 1:10 P.M. EDT