Press Briefing by Ari Fleischer

The James S. Brady Briefing Room

12:38 P.M. EDT

MR. FLEISCHER: Good afternoon. Let me begin with a personnel announcement. The President today announced his intention to nominate Hans Hertell to be Ambassador of the United States to the Dominican Republic.

Also I just want to advise you that at 4:15 p.m. this afternoon a senior administration official will come to the podium here for a background readout on the meeting with the President of Macedonia, which will take place just before that time.

And with that, I'm pleased to take your questions.

Q:Tomorrow, President Bush is receiving President Fox. I would like to ask you if you can give us something in advance maybe about the issue of immigration, the request of President Fox to open borders to immigrants?

MR. FLEISCHER: Well, I think there will be a series of topics discussed at that meeting. It will be the importance of our bilateral relationship. Trade issues will come up. I'd anticipate energy issues may come up. Immigration may come up.

As you know, yesterday the President sent a letter to members of Congress expressing his support for extending the deadline so that family members who would otherwise have to leave the United States in order to apply for legal status in the United States will not be forced to break up with their families.

That's part of the President's approach, that we should be a welcoming nation to immigrants. I anticipate those topics could come up tomorrow.

Q:Ari, congressional Republicans say that they have reached a deal on not just the tax part, but the spending as part of the President's budget blueprint, with a 5 percent increase in overall government spending, that they're going to announce it when they come here at 1:00 p.m. Would the White House support the 5 percent increase in government spending?

MR. FLEISCHER: There will be an event about 1:00 p.m., and I think you will hear the President at that time discuss what's been discussed on the Hill, the terms of this agreement. And the President is looking forward to that. But it looks like, at my last count, it was 4.9 percent.

Q:No preview on how the White House feels about that? It's something you can accept, I guess.

MR. FLEISCHER: I think the President will express it, himself.

Q:Ari, why does the President think he hasn't had more success with moderates, in terms of convincing them or -- one or two, however many he needs to jump ship and support the tax cut that he wanted, the size and the spending at the level he wanted?

MR. FLEISCHER: I think that's a question you need to put to others -- they should explain their actions. It's not for the White House to explain that. But, you know, the President, when you take a look back from the beginning of the campaign when he started talking about tax relief, when he announced his tax proposal on December 1st, I think it was, in 1999, and to where we are today, the President is nothing but pleased with what has taken place and how real this matter has now become and how the American people are about to get tax relief.

From the beginning, he never expected to get everything his way entirely -- never. He is extraordinarily pleased that he is getting so much of what he sought on behalf of the American people. This tax relief package will be the largest tax relief package in a generation. It will be the biggest tax cut since Ronald Reagan, and the President is nothing but pleased with the result of the negotiations as a result of the willingness of many Democrats to come together and support him -- Democrats who have broken with their party because they, too, like President Bush, believe in bipartisanship and putting the country first, which is what this agreement represents.

Q:Ari, on Social Security, if the President knows what his principles are and if he has stacked this commission with people who agree with those principles and all that's left are the details, why does he need a commission? What does he have the executive branch for? Is this just political cover?

MR. FLEISCHER: Well, the commission, as the President said this afternoon and this morning in the Rose Garden, is designed to help formulate many of the specific policies that will be necessary to implement the Social Security proposal the President wants to submit to the Congress.

But the reason the President has proposed this commission is because he doesn't want a commission that is covered in dust or is left in the dust. He doesn't want a commission that results in gridlock. He wants a commission that results in action.

And it has been too often -- not always, but too often -- the history of Social Security that commissions did gather dust or they did create gridlock. The President wants to break that pattern this year and that's why he has appointed the committee that he has, the commission that he has.

Q:But why doesn't he have people who are on his payroll who are accountable to him develop these policies and he stand out front and say, these are the policies which I am going to propose? Is he distancing himself from this commission or is this some kind of political --

MR. FLEISCHER: I think if the President could have been fortunate enough to have Senator Moynihan on his payroll, he might have been interested in doing that.

No, the point is that commissions -- commissions have had a history, when they're properly designated and established, of breaking through gridlock, of forcing results, of forcing action. And that is the pattern the President wants to create.

He very much wants to present a plan that is bipartisan to the United States Congress that helps create personal accounts, that doesn't raise taxes, that saves Social Security, particularly for younger workers. And that's the purpose of this commission.

Q:How do you develop a consensus when you start out with a group that already agrees with you?

MR. FLEISCHER: First of all, it's a group of eight Democrats and eight Republicans, so this is a bipartisan group and it represents a lot of new ways of thinking about Social Security.

And so the very nature of the group itself, it's diverse, it's bipartisan and it represents a new way of thinking on how to save Social Security. That in itself sends a powerful sign to the Congress. And the President ran on six specific principles on Social Security and no one should be surprised that the President is putting together a commission that will help him get those principles enacted into law.

I think the surprise would be if the President put people on a commission that would do the opposite of what he told the American people he would do. And the best example of that I can offer you is the President has said, unlike some people in this town, that taxes should not be raised as a solution to Social Security -- which is the way Social Security's problems have historically been addressed, principally, by raising taxes.

The President does not support raising taxes to save Social Security. So why on earth would he put somebody on the commission, for example, who advocates raising taxes? That's a formula for a gridlock, that's a formula for more division, and that's not the formula the President thinks will be the most successful bipartisan one to actually get action on Social Security.

Q:Who are you kidding? This is window dressing. You want the panel to endorse exactly what you're thinking, why issue a report?

MR. FLEISCHER: Well, if you look at previous commissions that have worked on Social Security, the Quadrennial Commission is the last commission that issued a report on Social Security, it was so badly and bitterly divided that they couldn't even get a majority opinion. They had three separate blocks ont Quadrennial Commission on Social Security. They were divided in three.

Again, that's a formula for gridlock, a formula for further inaction at a time when our nation needs to move to save Social Security, because in the President's opinion, the longer you wait, the harder it gets. So he's very proud to have put together a commission that represents this new way of thinking, his way of thinking and a bipartisan way of thinking, to save Social Security.

Q:Is it correct to assume that the principles, at least, are immutable, that in any legislation that does come down the line, that he won't accept legislation that does not adhere at least to these principles?

MR. FLEISCHER: Keith, if you're asking me if some people say the way to save Social Security is to raise taxes, will the President agree. The President will not agree. That's one of his principles. The six principles are the principles the President ran on, that he believes in. It's the charge to the commission, as you heard the President explain today. And those six principles are sound.

I think it's a sign of growing bipartisan strength that he is able to put together eight Democrats and eight Republicans to help him carry out his way of reforming and saving Social Security. It's a real sign of how Washington can change. And there will be many people on Capitol Hill, current members of Congress, who welcome this, who welcome the bipartisanship of it, who welcome the new way of thinking. There may be some who don't, and the President will listen to those voices.

But many of those voices do not support the creation of personal accounts to save Social Security, and they may, indeed, support raising taxes. That's just not the President's approach. So don't be surprised to see him fight for what he believes in.

Q:Did he consult with Democratic leaders?

MR. FLEISCHER: In the creation of the commission?

Q:Yes.

MR. FLEISCHER: I'd have to check with Congressional Affairs on exactly who got phone calls.

Q:They're saying, no, President Reagan did, in 1983, reach out to Tip O'Neill and say --

MR. FLEISCHER: Well, it's an entirely different commission, in 1983 the commission included sitting members of Congress. My old boss, Bill Archer, for example, was a member of the Greenspan Commission in 1983. This commission, by design, does not include sitting members of Congress. So it shouldn't surprise you there is a difference.

Q:Daschle and others are already essentially saying that this entire thing is a recipe for gridlock, that they're going to hold up the Senate, whatever it takes, they're not going to let any kind of privatization measures go through.

What makes the President think that this kind of commission, rubber-stamping his ideas, can possibly get through?

MR. FLEISCHER: I think the President will be very -- look, the President's focus is going to be on moving forward and getting things done. And that's what this commission represents, and that's what the American people want to have happen on Social Security. I think the President would hope that nobody would engage in gridlock at a time where our nation needs action, so that Social Security can be saved.

For instance, Congress, whether it was under Democrat control or Republican control, what actions have been taken in Congress to save Social Security? It is important to think new and to have a commission that supports the President's idea step forward, because the job has not been done in many a recent year, no matter who controlled the Congress.

So if the current Congress were able to get it done, we may have seen action previously. But the President does believe this Congress will be able to get it done with the help of this bipartisan commission.

Q:Senator Daschle argued this morning, as Democrats did during the campaign, that if you go to private accounts, people will wind up with 20 percent less in terms of the benefits they've received. That was a study that was quoted back during the campaign. What do you say to those who argue that this cannot possibly give people more money?

MR. FLEISCHER: I think Senator Moynihan, the former Democratic Chairman of the Senate Finance Committee, said it very well when he said this morning that personal retirement accounts are a way to create wealth for individuals, wealth for younger workers, wealth that people can pass on from one generation to the next, which you cannot currently do under the Social Security system.

So the answer is the answer that many other Democrats have given. Social Security personal accounts represent a new way of thinking that creates individual wealth that allows people to retire in greater comfort and security.

Q:Are you suggesting, whether it creates wealth or not, that even if it is in an individual account that you will wind up with less money overall? What assurance do you have from what the administration has looked at that that will not be the case?

MR. FLEISCHER: Well, under every formulation that has been examined involving these accounts, the six main proposals that exist on Capitol Hill dealing with personal accounts, each one of them creates a new system whereby retirees will have a greater rate of return on the money that is taken out of their payroll check, out of their taxes, and therefore they will have more money to retire, rather than less. So I think the facts suggest otherwise.

Q:Can you give, like, a specific example of how you think this commission can change the dynamic of this debate? Do you think this is about lobbying? Do you have 16 people now that are essentially new lobbyists for the White House? Is this opening up communication lines? Is there something they are going to write in part of the bill that will, you know, change the conversation? Specifically, what can they do?

MR. FLEISCHER: Let me answer that in two answers, two points. One, the dynamic of the debate has changed dramatically in just the last five to 10 years. There used to be a time when people would not even countenance the idea of allowing people to have their own personal retirement accounts. That day has long gone by now. That day is over.

Now it is just a question of how few people are left who don't support that idea, Democrats, Republicans, many new thinkers -- the new Democrats, for example, are powerful advocates of the idea of personal accounts. So the dynamic of the debate has changed dramatically as a new generation of seniors hits 65 who are used to having control of their own money for investments, and they use their own choices, made their own decisions and have been pleased with the returns they've gotten on money they've invested.

In addition, tens of millions of Americans have become investors in recent years, who never used to be investors before. America is increasingly -- has a new class of people, and the investor class. The last count I saw, there were some 60 million to 70 million Americans who own mutual funds.

That's changed the nature of the debate from where it was five or 10 years ago, where the only answers were to cut benefits or to raise taxes. Specifically on your question involving the commission, the charge of the commission, as the President explained it today and as you can see in the executive order, which was distributed to all of you, is to come up with the specific policy ideas to help implement the six principles that the President has proposed. And that will be the task of the commission.

They will work under the President's leadership. So after they make their report, there will be an interim report and then this fall they'll have the final report. Then I think you'll see the President work very diligently in displaying great leadership to work with members of Congress of both parties who are willing to listen and work with him to get Social Security reform.

Q:Does he expect this commission to help him with Congress?

MR. FLEISCHER: He expects the commission to come out with good ideas; and to the degree that good ideas help with Congress, of course the answer is, yes. But the task of the commission is to come up with the ideas.

Now, I think the commission will, of course, talk and work with members of Congress. So along the way to developing their specific recommendations and specific detailed plans, they will of course be in contact with members of Congress and make the case as it develops.

Q:Ari, on that point, you said you were going to check. Will the commission hold open hearings?

MR. FLEISCHER: I did look into that, yes, thank you for whoever asked that this morning. The commission is constituted under FACA, the Federal Advisory Commission Act and, therefore, meetings will be open.

Q:Ari, on the private accounts, particularly on investing with those private accounts in the market, the idea the President discussed during the campaign, that new investor class that you discussed, discovered in the past year the degree to which private investments can decline rapidly.

Is the President prepared to make any kind of commitment about a minimum level of payout it would have, even if somebody in that portion of the account that was privately invested ended up losing more or not getting as much as they would get under the existing system?

MR. FLEISCHER: Well, the details, of course, will be up to the commission to take a look at, and I don't want to prejudge what the President will conclude after he receives their reports. But over a 20-year historical time period, there has never been an instance in which the stock market has not returned positive results, not once over 20 years. This goes back even before the Great Depression, through some 11 or 12 recessions and through two World Wars. Over any 20-year period, the market has always returned a favorable result.

The problem with Social Security is, as it is currently constituted, it's a wonderful program for existing seniors and those who are near retirement, which is why the President will make no changes and will preserve the program in its exact form for those people.

But for younger workers, they will pay so much more in taxes than they can ever hope to get back in benefits, the only solutions are to raise taxes, which the President does not believe in, to cut benefits or to find a way to let those younger workers have a higher rate of return on the money that is taken out of their paycheck.

After all, it is their money, they earned it. It has been taken from their paycheck and the government has invested it for them in Treasury bills, which historically have paid a very low rate of return. So just looking back over history over any 20-year period --

Q:Ari, that doesn't specifically answer David's question. The President during the campaign as a candidate was unwilling to say whether he would support a guarantee for people in the position that David is talking about. Is it still his position that he has no position on that?

MR. FLEISCHER: Mimi, there is only one guarantee. And that is, if you don't take action to save Social Security, no one will get any money back because the system will start spending more than it pays in, in 2016. I think you have to allow the commission to complete its work.

Q:But you're saying, then, that somebody who doesn't necessarily choose -- some younger person who doesn't necessarily choose the privatization option as part of his or her package, does not get a guarantee that they will get at least as much as people who remain in the system are getting.

MR. FLEISCHER: I said you have to allow the commission to complete its work and then you will see exactly what the details are.

Q:So the President won't commit to that?

MR. FLEISCHER: You have to allow the commission to complete its work. Let's see what the commission comes up with. But there is only one guarantee. And that guarantee is that unless something is done to save the system, there won't be Social Security for younger workers. The system will start paying out more than it takes in, in just around 15 years from now -- and the Social Security system won't even be able to pay benefits for people who are young. And that's an unacceptable answer.

There are really only three ways to skin this cat. One is to raise taxes, two is to cut benefits, three is to get a higher rate of return. And the President believes the answer lies in the third category and so, too, do many Democrats and Republicans, and that's why he's pleased to put together this commission.

Q:You're, in effect, cutting benefits by getting people to move part of the money out of the system.

MR. FLEISCHER: Absolutely not. That results in an increased benefit, because people have more money to retire with.

Q:And you haven't ruled out today, ultimately the President accepting a plan that either does cut benefits in some way or increases the retirement age?

MR. FLEISCHER: You've seen the six principles the President has announced, and now the commission will do its work.

Q:Has the President instructed the commission to look into this guarantee, or a minimum pay-out option?

MR. FLEISCHER: You heard his statement today.

Q:And is the commission going to hear contrary views, people who oppose the private accounts?

MR. FLEISCHER: I think it's likely they will.

Q:Ari, last month, Koch Industries, one of the nation's largest oil companies, pled guilty to a felony environmental crime. The Washington Post reported also last month that the company and its employees gave $30,000 to President Bush during the presidential race and a similar amount in 1995 as governor of Texas when he was running.

Question: is the President now going to give the money back because the company has been convicted of a felony, and does the President have a policy of accepting campaign contributions from convicted felons?

MR. FLEISCHER: Can you give me a list of who the individuals were who gave contributions, and were any of these individuals convicted, or was it the company?

Q:The company was convicted, but the company also gave --

MR. FLEISCHER: So it was not the individuals? So it was not the individuals?

Q:The company is convicted of a felony, and the company gave money to --

MR. FLEISCHER: So, therefore, every employee of the company is a felon? Mr. Kinsolving?

Q:No, wait, wait. If I could follow up, the company was convicted of a felony, the company gave money to the campaign. What is the President's policy --

MR. FLEISCHER: The company gave money to the campaign?

Q:Yes.

MR. FLEISCHER: You cannot have corporate --

Q:Bush received more than -- according to The Post, Bush received more than $30,000 from Koch Industry, it's K-o-c-h, and its employees in the presidential race, and received a similar amount since 1995 as --

MR. FLEISCHER: As you're aware, it's illegal to accept corporate contributions in federal campaigns. So therefore, any contributions came from individuals. So unless you're prepared to say that any company that has a conviction means all its employees are felons, I'd be careful there.

Q:Okay, let me just have one further follow-up. Is it the President's policy, does the President have a policy on accepting money from executives of corporate felons?

MR. FLEISCHER: Again, individuals are free to give money in their own capacity, and it is illegal to accept money from corporations, as you know.

Q:Ari, there are reports that the Secret Service has supported the closing of Pennsylvania Avenue in front of the White House and Blair House ever since Agent Coffelt was killed defending President Truman. But Congresswoman Connie Morella of Maryland wants it opened again.

And my question is, does the President -- and I have a follow-up -- does the President support this lady, who almost always votes with the Democrats, or does he support the Secret Service in realizing what a McVeigh truck could do to a visiting prime minister or president staying in Blair House?

MR. FLEISCHER: Les, the President has not made a determination yet about what action will be taken with Pennsylvania Avenue. He is aware that there are some very important viewpoints on both sides of that issue, but he's made no final determination. I'll try to get an update on it.

Q:The Supreme Court rejected Ralph Nader's appeal, in which he sued because he and other fringe presidential candidates were excluded from presidential debates. And the court reviews --

MR. FLEISCHER: Is this a follow-up to Pennsylvania Avenue, because they were trying to get on Pennsylvania Avenue to get to the White House? (Laughter.)

Q:A two-part -- they both concern the White House. (Laughter.) And the Court refused Nader even a comment. And I wanted to know, does the President agree with the Court's decision or not, and does he think it was appropriate for the Court to have no comment at all for the dismissal of plaintiff Nader's questionable suit?

MR. FLEISCHER: Les, unless I'm advised otherwise, the President does not typically comment on judicial rulings of that nature.

Q:What is the position of the President on the Navy exercise in Vieques?

MR. FLEISCHER: The President believes it is very important for the peace of our nation and around the world that our troops be combat-ready, be well-trained, and able to carry out their missions. And that's why the President has asked Secretary Rumsfeld to continue his efforts to make certain our troops are trained while working with the government of Puerto Rico on the matters that they have raised in regard to the training exercises at Vieques.

Q:Has the President been in contact lately with the governor of Puerto Rico?

MR. FLEISCHER: You may want to talk to the Department of Defense. As I just mentioned, The President has asked the Defense Department -- and they have been handling it -- to work with officials on the island.

Q:Ari, on the tax cut agreement, does the President have any preference what parts of his own $1.6 trillion plan need to be squeezed down to $1.25 trillion?

MR. FLEISCHER: The President is going to continue to work with the Congress on that. The next step, of course, will be after the budget resolution is enacted then it will be up to the Senate Finance Committee to start work on its version of the tax legislation. And then it, of course, will go to a conference, where so much of what the President has proposed has already been voted on and passed in large bipartisan votes often in the House of Representatives. So the President will be pleased to continue to work with the Congress and the Senate Finance Committee.

Q:But what components of that plan do you prefer being modified?

MR. FLEISCHER: I think the President is content to let the debate begin in the Senate and he will make his thoughts clear at the appropriate time.

Q:Ari, what does the President hope to accomplish in the meeting tomorrow with the Israeli foreign minister?

MR. FLEISCHER: It will be part of the ongoing conversations that the President is having with leaders in the region to help create a framework that supports peace, that helps two parties come together by reminding them that it's really up to the Israelis and the Palestinians to create the will to create the peace and the United States will be there to help facilitate it.

Q:What's the current view here on prospects for resumed direct Israeli-Palestinian negotiations?

MR. FLEISCHER: As you know, Israel and the Palestinians have been meeting. They have been talking. There have been a series of security talks.

Q:Formal negotiations beyond these?

MR. FLEISCHER: These are formal security talks that have been under way now for approximately two, three weeks, so those have begun.

Q:May I follow on Peter's? Do you know what -- do you have any preview about the speech the President will give tomorrow to an American Jewish group? And do you know what progress Paris is making on Egypt and Jordan guaranteeing the peace?

MR. FLEISCHER: The speech tomorrow night to the American Jewish community is going to be an interesting speech. The President is going to talk about religious freedom around the world. He is going to discuss some of the problems and he'll be specific. Where religious freedom is -- people who want to practice their religion are persecuted. And his remarks will be a very clear call around the world to recognize the importance of religious freedom so people of all faiths can have the right to worship as they see fit.

Q:Will we get an advance text?

Q:Will he single out China or Sudan, Ari?

MR. FLEISCHER: We are going to try to distribute the remarks tomorrow prior to the speech. So let's talk tomorrow and I'll see what time I can get you an embargoed topic.

Q:Will he also talk directly about the current situation in the Middle East and what the administration is doing to try and bring Israelis and Palestinians together? I mean, any specifics on that in that speech?

MR. FLEISCHER: I just outlined to you the core of what the speech will be tomorrow. And you will be able to look at it in its entirety tomorrow and judge for yourself. But what I just outlined is the heart of the message tomorrow.

Q:Ari, the President told the education round table yesterday that he had basically given up on getting vouchers, enough support for private school vouchers in Congress this year. Is this something that he is planning on bringing up year in and year out? Is he committed to that --

MR. FLEISCHER: He didn't say he was giving up. He said he still believes in vouchers. There will be a vote on the floor of the Senate, an amendment to allow for more school choice options. The President hopes that will pass. And we'll see how that vote comes out.

Q:He called himself a realist. If it doesn't happen this year --

MR. FLEISCHER: The President is always a realist.

Q:Well, is he committed to bringing it up in future years if it doesn't happen this year?

MR. FLEISCHER: I am not going to guess what's going to happen in future years. Let's let the vote take place first and see if the President's position finds sufficient support.

Q:On tax cuts, you acknowledge, I gather, the fact that it is $300 billion less or more will require fundamental restructuring of the way the benefits are given out?

MR. FLEISCHER: No, I don't think that's true. One of the most

interesting things about tax legislation, it's so numerical that you can still have the core principles of what you believe in -- in this case, across-the-board marginal income tax rate cuts, marriage penalty relief, death tax relief, and there are all kinds of ways to look at phase-ins and the periods of time at which things become effective, to implement the same policies over a slower period of time. Which means that the tax cut can be accomplished for less money over a longer period of time.

Thank you, everybody.

Q:Hold on. Like Lester, I have one completely unrelated follow up. (Laughter.) On the faith-based initiative, have you lost momentum on that? And what do you make of the fact that a number of Southern Baptist ministers are now opposed to the President's proposal?

MR. FLEISCHER: Frankly, that's nothing new. Since the President made his proposal, there have been reflections from both the left and the right that have raised questions. But the mainstream middle, many people on all sides, including others on the left and right, have supported it.

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