THE WHITE HOUSE
Office of the Press
Secretary
______________________________________________________________________
For Immediate
Release
February 15, 2011
PRESS CONFERENCE BY
THE PRESIDENT
South Court
Auditorium
THE PRESIDENT: Good morning,
everybody. Please have a seat. I figured that I’d give Jay one more
taste of freedom -- (laughter) -- before we lock him in a room with all of you,
so I’m here to do a little downfield blocking for him. Before I take a
few questions, let me say a few words about the budget we put out
yesterday.
Just like every family in America,
the federal government has to do two things at once. It has to live
within its means while still investing in the future. If you’re a family
trying to cut back, you might skip going out to dinner, you might put off a
vacation. But you wouldn’t want to sacrifice saving for your kids’
college education or making key repairs in your house. So you cut back on what
you can’t afford to focus on what you can’t do
without.
And that’s what we’ve done with
this year’s budget. When I took office, I pledged to cut the deficit in
half by the end of my first term. Our budget meets that pledge and puts
us on a path to pay for what we spend by the middle of the decade.
As a start, it freezes domestic
discretionary spending over the next five years, which would cut the deficit by
more than $400 billion over the next decade, and bring annual domestic spending
to its lowest share of the economy since Dwight Eisenhower.
Now, some of the savings will come
through less waste and more efficiency. To take just one example, we’ll
give -- we'll save billions of dollars by getting rid of 14,000 office
buildings, lots, and government-owned properties that we no longer need.
And to make sure special interests are not larding up legislation with special
projects, I’ve pledged to veto any bills that contain earmarks.
Still, even as we cut waste and
inefficiency, this budget freeze will also require us to make some tough
choices. It will mean freezing the salaries of hardworking federal
employees for the next two years. It will mean cutting things I care about
deeply, like community action programs for low-income communities. And we
have some conservation programs that are going to be scaled back. These
are all programs that I wouldn’t be cutting if we were in a better fiscal
situation. But we're not.
We also know that cutting annual
domestic spending alone won’t be enough to meet our long-term fiscal
challenges. That’s what the bipartisan fiscal commission concluded;
that’s what I've concluded. And that's why I’m eager to tackle excessive
spending wherever we find it -– in domestic spending, but also in defense
spending, health care spending, and spending that is embedded in the tax
code.
Some of this spending we’ve begun
to tackle in this budget -– like the $78 billion that Secretary Gates
identified in defense cuts. But to get where we need to go we’re going to
have to do more. We’ll have to bring down health care costs further,
including in programs like Medicare and Medicaid, which are the single biggest
contributor to our long-term deficits. I believe we should strengthen
Social Security for future generations, and I think we can do that without
slashing benefits or putting current retirees at risk. And I’m willing to
work with everybody on Capitol Hill to simplify the individual tax code for all
Americans.
All of these steps are going to be
difficult. And that’s why all of them will require Democrats,
independents, and Republicans to work together. I recognize that there
are going to be plenty of arguments in the months to come, and everybody is
going to have to give a little bit. But when it comes to difficult
choices about our budget and our priorities, we have found common ground
before. Ronald Reagan and Tip O’Neill came together to save Social
Security. Bill Clinton and the Republican Congress eventually found a way
to settle their differences and balance the budget. And many Democrats
and Republicans in Congress today came together in December to pass a tax cut
that has made Americans’ paychecks a little bigger this year and will spur on
additional economic growth this year.
So I believe we can find this
common ground, but we're going to have to work. And we owe the American
people a government that lives within its means while still investing in our
future -- in areas like education, innovation, and infrastructure that
will help us attract new jobs and businesses to our shores. That’s the
principle that should drive this debate in the coming months. I believe
that’s how America will win the future in the coming years.
So with that, let me take a few
questions. And I'm going to start off with Ben Feller of
AP.
Q Thank you very
much, Mr. President. You’ve been talking a lot about the need for tough
choices in your budget, but your plan does not address the long-term crushing
costs of Social Security, Medicare, Medicaid -- the real drivers of long-term
debt. Can you explain that? Where is your leadership on that issue
and when are we going to see your plan?
And if I may, sir, on the foreign
front, the uprising in Egypt has helped prompt protests in Bahrain, in Yemen,
and Iran. I'm wondering how you balance your push for freedoms in those places
against the instability that could really endanger U.S. interests.
THE PRESIDENT: On the budget,
what my budget does is to put forward some tough choices, some significant
spending cuts, so that by the middle of this decade our annual spending will
match our annual revenues. We will not be adding more to the national
debt. So, to use a -- sort of an analogy that families are familiar with,
we're not going to be running up the credit card any more. That's
important -- and that's hard to do. But it’s necessary to do. And I
think that the American people understand that.
At the same time, we're going to be
making some key investments in places like education, and science and
technology, research and development that the American people understand is
required to win the future. So what we've done is we've taken a scalpel
to the discretionary budget rather than a machete.
Now, I said in the State of the
Union and I'll repeat, that side of the ledger only accounts for about 12
percent of our budget. So we've got a whole bunch of other stuff that
we're going to have to do, including dealing with entitlements.
Now, you talked about Social
Security, Medicare and Medicaid. The truth is Social Security is not the
huge contributor to the deficit that the other two entitlements are.
I'm confident we can get Social Security done in the same
way that Ronald Reagan and Tip O’Neill were able to get it done, by parties
coming together, making some modest adjustments. I think we can avoid
slashing benefits, and I think we can make it stable and stronger for not only
this generation but for the next generation.
Medicare and Medicaid are huge
problems because health care costs are rising even as the population is getting
older. And so what I've said is that I'm prepared to work with Democrats
and Republicans to start dealing with that in a serious way. We made a
down payment on that with health care reform last year. That's part of
what health care reform was about. The projected deficits are going to be
about $250 billion lower over the next 10 years than they otherwise would have
been because of health care reform, and they’ll be a trillion dollars lower
than they otherwise would have been if we hadn’t done health care reform for
the following decade.
But we're still going to have to do
more. So what I've said is that if you look at the history of how these
deals get done, typically it’s not because there’s an Obama plan out there;
it’s because Democrats and Republicans are both committed to tackling this
issue in a serious way.
And so what we've done is we've
been very specific in terms of how to stabilize the discretionary budget, how
to make sure that we're not adding additional debt by 2015. And then
let’s together, Democrats and Republicans, tackle these long-term problems in a
way that I think will ensure our fiscal health and, at the same time, ensure
that we're making investments in the future.
Q But when is
that happening?
THE PRESIDENT: Well, we're
going to be in discussions over the next several months. I mean this is
going to be a negotiation process. And the key thing that I think the
American people want to see is that all sides are serious about it and all
sides are willing to give a little bit, and that there’s a genuine spirit of
compromise as opposed to people being interested in scoring political points.
Now, we did that in December during
the lame duck on the tax cut issue. Both sides had to give. And
there were folks in my party who were not happy, and there were folks in the
Republican Party who were not happy. And my suspicion is, is that we’re
going to be able to do the same thing if we have that same attitude with
respect to entitlements.
But the thing I want to emphasize
is nobody is more mindful than me that entitlements are going to be a key part
of this issue -- as is tax reform. I want to simplify rates. And I
want to, at the same time, make sure that we have the same amount of money
coming in as going out.
Those are big, tough negotiations,
and I suspect that there’s going to be a lot of ups and downs in the months to
come before we finally get to that solution. But just as a lot of people
were skeptical about us being able to deal with the tax cuts that we did in
December but we ended up getting it done, I’m confident that we can get this
done as well.
Now, with respect to the situation
in the Middle East, obviously, there’s still a lot of work to be done in Egypt
itself, but what we’ve seen so far is positive. The military council that
is in charge has reaffirmed its treaties with countries like Israel and international
treaties. It has met with the opposition, and the opposition has felt
that it is serious about moving towards fair and free elections. Egypt is
going to require help in building democratic institutions and also in
strengthening an economy that's taken a hit as a consequence of what
happened. But so far at least, we’re seeing the right signals coming out
of Egypt.
There are ramifications, though,
throughout the region. And I think my administration’s approach is the
approach that jibes with how most Americans think about this region, which is
that each country is different, each country has its own traditions; America
can’t dictate how they run their societies, but there are certain universal
principles that we adhere to. One of them is we don't believe in violence
as a way of -- and coercion -- as a way of maintaining control. And so we
think it’s very important that in all the protests that we’re seeing in --
throughout the region that governments respond to peaceful protesters peacefully.
The second principle that we
believe in strongly is in the right to express your opinions, the freedom of
speech and freedom of assembly that allows people to share their grievances
with the government and to express themselves in ways that hopefully will over
time meet their needs.
And so we have sent a strong
message to our allies in the region, saying let’s look at Egypt’s example as
opposed to Iran’s example. I find it ironic that you’ve got the Iranian
regime pretending to celebrate what happened in Egypt when, in fact, they have
acted in direct contrast to what happened in Egypt by gunning down and beating
people who were trying to express themselves peacefully in Iran.
And I also think that an important
lesson -- and I mentioned this last week -- that we can draw from this is real
change in these societies is not going to happen because of terrorism; it’s not
going to happen because you go around killing innocents -- it’s going to happen
because people come together and apply moral force to a situation. That’s
what garners international support. That’s what garners internal support.
That’s how you bring about lasting change.
Patricia Zengerle.
Q Thank you, Mr.
President. Getting back to the unrest in the Middle East and North
Africa, what concerns do you have about instability, especially in Saudi
Arabia, as the demonstrations spread? Do you see -- foresee any effects
on oil prices? And talking about Iran, can you comment about the unrest
there more? What is your message to the Iranian people -- in light of
there was some criticism that your administration didn’t speak out strongly
enough after their last -- the demonstrations in Iran after their
elections? Excuse me.
THE PRESIDENT: That’s
okay. Well, first of all, on Iran, we were clear then and we are clear
now that what has been true in Egypt should be true in Iran, which is that
people should be able to express their opinions and their grievances and seek a
more responsive government. What's been different is the Iranian
government’s response, which is to shoot people and beat people and arrest
people.
And my hope and expectation is, is
that we’re going to continue to see the people of Iran have the courage to be
able to express their yearning for greater freedoms and a more representative
government, understanding that America cannot ultimately dictate what happens
inside of Iran any more than it could inside of Egypt. Ultimately these
are sovereign countries that are going to have to make their own
decisions. What we can do is lend moral support to those who are seeking
a better life for themselves.
Obviously we’re concerned about
stability throughout the region. Each country is different. The
message that we’ve sent even before the demonstrations in Egypt has been, to
friend and foe alike, that the world is changing; that you have a young,
vibrant generation within the Middle East that is looking for greater
opportunity, and that if you are governing these countries, you’ve got to get
out ahead of change. You can’t be behind the curve.
And so I think that the thing that
will actually achieve stability in that region is if young people, if ordinary
folks end up feeling that there are pathways for them to feed their families,
get a decent job, get an education, aspire to a better life. And the more
steps these governments are taking to provide these avenues for mobility and
opportunity, the more stable these countries are.
You can’t maintain power through
coercion. At some level, in any society, there has to be consent.
And that’s particularly true in this new era where people can communicate not
just through some centralized government or a state-run TV, but they can get on
a smart phone or a Twitter account and mobilize hundreds of thousands of
people.
My belief is that, as a consequence
of what’s happening in Tunisia and Egypt, governments in that region are
starting to understand this. And my hope is, is that they can operate in
a way that is responsive to this hunger for change but always do so in a way
that doesn’t lead to violence.
Chip Reid.
Q Thank you, Mr.
President. Actually, I'm going to have to get my glasses out to read
these --
THE PRESIDENT: That’s a bad
sign there, Chip. (Laughter.)
Q A little fine
print -- a little fine print in the budget, Mr. President. You said that
this budget is not going to add to the credit card as of about the middle of
the decade. And as Robert Gibbs might say, I'm not a budget expert and
I'm not an economist, but if you could just explain to me how you can say that
when, if you look on page 171, which I'm sure you’ve read -- (laughter) -- it
is the central page in this -- the deficits go from $1.1 trillion down to $768 billion,
and they go down again all the way to $607 billion in 2015, and then they start
to creep up again, and by 2021, it’s at $774 billion. And the total over
those 10 years, the total debt is $7.2 trillion on top of the $14 trillion we
already have. How can you say that we’re living within our means?
THE PRESIDENT: Well, here’s
-- let me be clear on what I'm saying, because I'm not suggesting that we don’t
have to do more. We still have all this accumulated debt as a consequence of
the recession and as a consequence of a series of decisions that were made over
the last decade. We’ve piled up, we’ve racked up a whole bunch of
debt. And there is a lot of interest on that debt.
So, in the same way that if you’ve
got a credit card and you’ve got a big balance, you may not be adding to
principal -- you’ve still got all that interest that you’ve got to pay.
Well, we’ve got a big problem in terms of accumulated interest that we’re
paying, and that’s why we’re going to have to whittle down further the debt
that’s already been accumulated. So that’s problem number one.
And problem number two we already
talked about, which is rising health care costs and programs like Medicaid and
Medicare are going to -- once you get past this decade, going to start zooming
up again as a consequence of the population getting older and health care costs
going up more rapidly than incomes and wages and revenues are going up.
So you’ve got those two big
problems. What we’ve done is to try to take this in stages. What we
say in our budget is let’s get control of our discretionary budget to make sure
that whatever it is that we’re spending on an annual basis we’re also taking in
a similar amount. That’s step number one.
Step number two is going to make --
is going to be how do we make sure that we’re taking on these long-term drivers
and how do we start whittling down the debt. And that’s going to require
entitlement reform and it’s going to require tax reform.
And in order to accomplish those
two things, we’re going to have to have a spirit of cooperation between
Democrats and Republicans. And I think that’s possible. I think
that’s what the American people are looking for. But what I think is
important to do is not discount the tough choices that are required just to
stabilize the situation. It doesn’t solve it, but it stabilizes it.
And if we can get that done, that starts introducing this concept of us being
able to, in a serious way, cooperate to meet this fiscal challenge. And
that will lay the predicate for us being able to solve some of these big
problems over the course of the next couple of years as well.
So, again, I just want to repeat,
the first step in this budget is to make sure that we’re stabilizing the
current situation. The second step is going to be to make sure that we’re
taking on some of these long-term drivers. But we’ve got to get control
of the short-term deficit as well, and people are going to be looking for a
signal for that, and the choices that we have made are some pretty tough
choices -- which is why I think you have been seeing some grumblings not just
from the other party but also from my own party about some of the decisions
that we make.
Chuck Todd.
Q Thank you, Mr.
President. Everything you have talked about -- tax reform, the
entitlement reform, two parties coming together just happening in December in
your fiscal commission. You had a majority consensus to do all
this. It has now been shelved. It seems that you have not taken --
I guess my question is what was the point of the fiscal commission? If
you have this moment where you had Tom Coburn, your conservative friend in the
United States Senate, sign on to this deal; Judd Gregg was also on this thing;
you had Dick Durbin, your good friend from Illinois, Democrat -- everything you
just described in the answer to Chip and the answer to Ben just happened.
Why not grab it?
THE PRESIDENT: The notion
that it has been shelved I think is incorrect. It still provides a
framework for a conversation.
Part of the challenge here is that
this town -- let’s face it, you guys are pretty impatient. If something
doesn’t happen today, then the assumption is it’s just not going to
happen. Right? I’ve had this conversation for that last two years
about every single issue that we worked on, whether it was health care or
"don't ask, don't tell," on Egypt, right? We’ve had this
monumental change over the last three weeks -- well, why did it take three
weeks? (Laughter.) So I think that there’s a tendency for us to
assume that if it didn’t happen today it’s not going to happen.
Well, the fiscal commission put out
a framework. I agree with much of the framework; I disagree with some of
the framework. It is true that it got 11 votes, and that was a positive
sign. What's also true is, for example, is, is that the chairman of the
House Republican budgeteers didn’t sign on. He’s got a little bit of
juice when it comes to trying to get an eventual budget done, so he’s got
concerns. So I’m going to have to have a conversation with him, what
would he like to see happen.
I’m going to have to have a
conversation with those Democrats who didn’t vote for it. There are some
issues in there that as a matter of principle I don't agree with, where I think
they didn’t go far enough or they went too far. So this is going to be a
process in which each side, both in -- in both chambers of Congress go back and
forth and start trying to whittle their differences down until we arrive at
something that has an actual change of passage.
And that's my goal. I mean,
my goal here is to actually solve the problem. It’s not to get a good
headline on the first day. My goal is, is that a year from now or two
years from now, people look back and say, you know what, we actually started
making progress on this issue.
Q What do you
say, though -- it looks like, no, you first; no, you first -- and nobody --
everybody says --
THE PRESIDENT: But there will
--
Q -- but nobody
wants to talk about --
THE PRESIDENT: Chuck, there
was this -- this was the same criticism people had right after the midterm
election. If you had polled the press room and the conventional wisdom in
Washington after the midterm, the assumption was there's no way we were going
to end up getting a tax deal that got the majority of both Democrats and
Republicans. It was impossible, right? And we got it done.
So this is not a matter of you go
first or I go first. This is a matter of everybody having a serious
conversation about where we want to go, and then ultimately getting in that
boat at the same time so it doesn’t tip over. And I think that can
happen.
Julianna Goldman. There you
are.
Q Thank you, Mr.
President. Your budget relies on revenue from tax increases to
multinational corporations that ship jobs overseas and on increases on the oil
and gas industry. You’ve been calling on this for years. And if you
couldn’t get it through a Democratic Congress, why do you think you’ll be able
to get it through now? And also doesn’t it blunt your push for
deficit-neutral corporate tax reform?
THE PRESIDENT: Well, I
continue to believe I’m right. (Laughter.) So we’re going to try
again. I think what’s different is everybody says now that they're really
serious about the deficit. Well, if you’re really serious about the
deficit -- not just spending, but you’re serious about the deficit
overall -- then part of what you have to look at is unjustifiable spending
through the tax code, through tax breaks that do not make us more competitive,
do not create jobs here in the United States of America.
And the two examples you cite I
think most economists would look at and they’d say these aren’t contributing to
our long-term economic growth. And if they're not, why are we letting
some folks pay lower taxes than other folks who are creating jobs here in the
United States and are investing? Why are we not investing in the energy
sources of the future, just the ones in the past, particularly if the energy
sources of the past are highly profitable right now and don't need a tax break?
So I think what may have changed is
if we are going to get serious about deficit reduction and debt reduction, then
we’ve got to look at all the sources of deficit and debt. We can’t be
just trying to pick and choose and getting 100 percent of our way.
The same is true, by the way, for
Democrats. I mean, there are some provisions in this budget that are hard
for me to take. You’ve got cities around the country and states around the
country that are having a tremendously difficult time trying to balance their
own budgets because of fallen revenue. They’ve got greater demands
because folks have lost their jobs; the housing market is still in a tough way
in a lot of these places. And yet part of what this budget says is we’re
going to reduce Community Development Block Grants by 10 percent. That’s
not something I'd like to do. But -- and if it had come up a year ago or
two years ago, I would have said no. Under these new circumstances, I'm
saying yes to that. And so my expectation is, is that everybody is going
to have to make those same sorts of compromises.
Now, with respect to corporate tax
reform, the whole concept of corporate tax reform is to simplify, eliminate
loopholes, treat everybody fairly. That is entirely consistent with
saying, for example, that we shouldn’t provide special treatment to the oil
industry when they’ve been making huge profits and can afford to further invest
in their companies without special tax breaks that are different from what
somebody else gets.
Q -- you can't
eliminate those --
THE PRESIDENT: Well, what is
absolutely true is that it’s going to be difficult to achieve serious corporate
tax reform if the formula is, lower our tax rates and let us keep all our
special loopholes. If that’s the formula, then we’re not going to get it
done. I wouldn’t sign such a bill, and I don’t think the American people
would sign such a bill.
If you’re a small business person
out on Main Street, and you’re paying your taxes, and you find out that you’ve
got some big company with billions of dollars in far-flung businesses all
across the world, and they’re paying a fraction of what you’re paying in taxes,
you’d be pretty irritated -- and rightfully so.
And so the whole idea of corporate
reform -- corporate tax reform -- is, yes, let’s lower everybody’s rates so
American businesses are competitive with businesses all around the world; but
in order to pay for it, to make sure that it doesn’t add to our deficit, let’s
also make sure that these special interest loopholes that a lot of lobbyists
have been working very hard on to get into the tax code -- let’s get rid of
those as well.
All right. April Ryan.
Caught you by surprise, April.
Q You did,
sir. Thank you. Mr. President, I want to focus in on the least of
these. You started your career of service as a community organizer and
now we are hearing from people like -- organizations like the CBC is saying
rebuilding our economy on the backs of the most vulnerable Americans is
something that is simply not acceptable, like the cuts to the Community Service
Block Grants, Pell Grants, heating oil assistance, and freezing salaries of
federal workers. Now, Roderick Harrison, of the Joint Center for
Political and Economic Studies, says it’s not good to make these types of cuts
at a time of recession, instead of doing it at a time of recovery.
And also I need to ask you, have
you been placing calls for your friend, Rahm Emanuel, for his mayoral campaign
in Chicago? Thank you.
THE PRESIDENT: I’ll take the
last question first. I don’t have to make calls for Rahm Emanuel.
He seems to be doing just fine on his own. And he’s been very busy
shoveling snow out there. (Laughter.) I’ve been very impressed with
that. I never saw him shoveling around here. (Laughter.)
Let me use Pell Grants as an
example of how we’re approaching these difficult budget choices in a way that
is sustainable but preserves our core commitment to expanding
opportunity. When I came into office I said I wanted to once again have
America have the highest graduation rates, college graduation rates, of any
country in the world -- that we had been slipping. And so I significantly
increased the Pell Grant program by tens of billions of dollars. And so
millions of young people are going to have opportunities through the Pell Grant
program that they didn’t before, and the size of the Pell Grant itself went up.
What we also did, partly because we
were in a recessionary situation and so more people were having to go back to
school as opposed to work, what we also did was, for example, say that you can
get Pell Grants for summer school. Now we’re in a budget crunch.
The take-up rate on the Pell Grant program has skyrocketed. The costs
have gone up significantly. If we continue on this pace, sooner or later
what's going to happen is we’re just going to have to chop off
eligibility. We’ll just have to say, that's it, we can’t do this anymore,
it’s too expensive.
So instead what we said was how do
we trim, how do we take a scalpel to the Pell Grant program, make sure that we
keep the increase for each Pell Grant, make sure that the young people who are
being served by the Pell Grant program are still being served, but, for
example, on the summer school thing, let’s eliminate that. That will save
us some money, but the core functions of the program are sustained.
That's how we’re approaching all these cuts.
On the LIHEAP program, the home
heating assistance program, we doubled the home heating assistance program when
I first came into office, in part because there was a huge energy spike, and so
folks -- if we had just kept it at the same level, folks would have been in
real trouble. Energy prices have now gone down, but the costs of the
program have stayed the same. So what we’ve said is, well, let’s go back
to a more sustainable level. If it turns out that once again you see a
huge energy spike, then we can revisit it. But let’s not just assume
because it’s at a $5 billion level that each year we’re going to sustain it a
$5 billion level regardless of what’s happening on the energy front.
That doesn’t mean that these aren’t
still tough cuts -- because there are always more people who could use some
help across the country than we have resources. And so it’s still a tough
decision, and I understand people’s frustrations with some of these
decisions. Having said that, my goal is to make sure that we’re looking
after the vulnerable; we’re looking after the disabled; we’re looking after our
seniors; we’re making sure that our education system is serving our kids so
that they can compete in the 21st century; we’re investing in the future, and
doing that in a way that's sustainable and that we’re paying for -- as opposed
to having these huge imbalances where there are some things that aren’t working
that we’re paying a lot of money for; there’s some things that are
underfunded. We’re trying to make adjustments so that we’ve got a
sustainable budget that works for us over the long term.
And by the way, there are just some
things that just aren’t working at all, so we’ve eliminated a couple hundred
programs in this budget. On the education front, we’re consolidating from
33 programs to 11 programs. There is waste and inefficiency there that is
long overdue, and we identify a number of these programs that just don't
work. Let’s take that money out of those programs that don't work, and
put in money -- that money in programs that do.
Q -- say is the
President feeling our pain, especially as you were a community organizer --
THE PRESIDENT: I -- look, I
definitely feel folks’ pain.
Somebody is doing a book about the 10 letters that I get
every day, and they came by to talk to me yesterday. And they said,
what’s the overwhelming impression that you get when you read these 10 letters
a day, and what I told them is I'm so inspired by the strength and resilience
of the American people, but sometimes I'm also just frustrated by the number of
people out there who are struggling, and you want to help every single one
individually. You almost feel like you want to be a case worker and just
start picking up the phone and advocating for each of these people who are
working hard, trying to do right by their families; oftentimes, through no
fault of their own, they’ve had a tough time, particularly over these last
couple of years.
So, yes, it’s frustrating.
But my job is to make sure that we’re focused over the long term: Where
is it that we need to go? And the most important thing I can do as
President is make sure that we’re living within our means, getting a budget
that is sustainable, investing in the future and growing the economy. If
I do that, then that’s probably the most help I can give to the most number of
people.
Jake Tapper.
Q Thanks, Mr.
President. House Republicans, as you know, want to start cutting now,
want to start cutting this year’s budget. Are you willing to work with
them in the next few weeks so as to avoid a government shutdown? There’s
been talk of a down payment on budget cuts that they would like to make for this
year’s budget.
And also, I was wondering if you
could talk a little bit about the attempts to get American diplomat Ray Davis
freed from Pakistan. Some have criticized the administration for putting
pressure too publicly on what is essentially a weak government, and I’m
wondering if you could walk us through that process. Thanks.
THE PRESIDENT: My goal is to
work with the Republicans, both on the continuing resolution -- and for those
who are watching that don’t know Washingtonese, the CR is a continuing
resolution, a way to just keep government going when you don’t have an overall
budget settled. And we didn’t settle our overall budget from last year,
so this is carryover business from last year, funding vital government
functions this year.
So I want to work with everybody,
Democrats and Republicans, to get that resolved. I think it is important
to make sure that we don’t try to make a series of symbolic cuts this year that
could endanger the recovery. So that’s point number one.
What I’m going to be looking for is
some common sense that the recovery is still fragile; we passed this tax cut
package precisely to make sure that people had more money in their pockets,
that their paychecks were larger, were provided these tax credits and incentives
for businesses. But if the steps that we take then prompt thousands of
layoffs in state or local government, or core vital functions of government
aren’t performed properly, well, that could also have a dampening impact on our
recovery as well.
So my measure is going to be are we
doing things in a sensible way, meeting core functions, not endangering our
recovery. In some cases, like defense, for example, Secretary Gates has
already testified if we’re operating -- even operating under the current
continuing resolution is putting significant strains on our ability to make
sure our troops have what they need to perform their missions in
Afghanistan. Further slashes would impair our ability to meet our
mission.
And so we’ve got to be careful.
Again, let’s use a scalpel; let’s not use a machete. And if we do that,
there should be no reason at all for a government shutdown. And I think
people should be careful about being too loose in terms of talking about a
government shutdown, because this has -- this is not an abstraction.
People don’t get their Social Security checks. They don’t get their
veterans payments. Basic functions shut down. And it -- that, also,
would have a adverse effect on our economic recovery. It would be
destabilizing at a time when, I think, everybody is hopeful that we can start
growing this economy quicker.
So I’m looking
forward to having a conversation. But the key here is for people to be
practical and not to score political points. That’s true for all of
us. And I think if we take that approach we can navigate the situation
short term and then deal with the problem long term.
With respect to Mr. Davis, our
diplomat in Pakistan, we’ve got a very simple principle here that every country
in the world that is party to the Vienna Convention on Diplomatic Relations is
-- has upheld in the past and should uphold in the future, and that is if our
diplomats are in another country, then they are not subject to that country’s
local prosecution.
We respect it with respect to
diplomats who are here. We expect Pakistan, that's a signatory and
recognize Mr. Davis as a diplomat, to abide by the same convention.
And the reason this is an important
principle is if it starts being fair game on our ambassadors around the world,
including in dangerous places, where we may have differences with those
governments, and our ambassadors or our various embassy personnel are having to
deliver tough messages to countries where we disagree with them on X, Y, Z, and
they start being vulnerable to prosecution locally, that’s untenable. It
means they can’t do their job. And that’s why we respect these
conventions, and every country should as well.
So we’re going to be continuing to
work with the Pakistani government to get this person released. And
obviously part of -- for those who aren’t familiar with the background on this,
a couple of Pakistanis were killed in a incident between Mr. Davis within -- in
Pakistan. So obviously, we’re concerned about the loss of life.
We’re not callous about that. But there’s a broader principle at stake
that I think we have to uphold.
Q How serious
have your threats been to the Pakistani government if they don't hand him over?
THE PRESIDENT: Well, I’m not
going to discuss the specific exchanges that we’ve had. But we’ve been
very firm about this being an important priority.
Ed Henry.
Q Thank you, Mr.
President. I want to go back to Egypt because there was some perception
around the world that maybe you were too cautious during that crisis and were
kind of a step behind the protesters. I know that, as you said, there was
dramatic change in three weeks, and some of us wanted it to go even faster than
that. But having said that, I realize it’s a complicated situation.
It was evolving rapidly. But now as these protests grow throughout the
Mideast and North Africa -- you said before your message to the governments
involved was make sure you’re not violent with peaceful protesters. But
what’s your message to the protesters? Do you want them to taste
freedom? Or do you want them to taste freedom only if it will also bring
stability to our interests in the region?
THE PRESIDENT: Well, first of
all, without revisiting all the events over the last three weeks, I think
history will end up recording that at every juncture in the situation in Egypt
that we were on the right side of history. What we didn't do was pretend
that we could dictate the outcome in Egypt, because we can’t. So we were
very mindful that it was important for this to remain an Egyptian event; that
the United States did not become the issue, but that we sent out a very clear
message that we believed in an orderly transition, a meaningful transition, and
a transition that needed to happen not later, but sooner. And we were
consistent on that message throughout.
Particularly if you look at my
statements, I started talking about reform two weeks or two-and-a-half weeks
before Mr. Mubarak ultimately stepped down. And at each juncture I think
we calibrated it just about right. And I would suggest that part of the
test is that what we ended up seeing was a peaceful transition, relatively
little violence, and relatively little, if any, anti-American sentiment, or anti-Israel
sentiment, or anti-Western sentiment. And I think that testifies the fact
that in a complicated situation, we got it about right.
My message I think to demonstrators
going forward is your aspirations for greater opportunity, for the ability to
speak your mind, for a free press, those are absolutely aspirations we
support.
As was true in Egypt, ultimately
what happens in each of these countries will be determined by the citizens of
those countries. And even as we uphold these universal values, we do want
to make sure that transitions do not degenerate into chaos and violence.
That’s not just good for us; it’s good for those countries. The history
of successful transitions to democracy have generally been ones in which peaceful
protests led to dialogue, led to discussion, led to reform, and ultimately led
to democracy.
And that’s true in countries like
Eastern Europe. That was also true in countries like Indonesia, a
majority Muslim country that went through some of these similar transitions but
didn’t end up doing it in such a chaotic fashion that it ended up dividing the
societies fundamentally.
Q But has it
improved the chances of something like Mideast peace, or has it made it more
complicated in your mind?
THE PRESIDENT: I think it
offers an opportunity as well as a challenge. I think the opportunity is
that when you have the kinds of people who were in Tahrir Square, feeling that
they have hope and they have opportunity, then they’re less likely to channel
all their frustrations into anti-Israel sentiment or anti-Western sentiment,
because they see the prospect of building their own country. That’s a
positive.
The challenge is that democracy is
messy. So there -- and if you’re trying to negotiate with a democracy,
you don’t just have one person to negotiate with; you have to negotiate with a
wider range of views.
But I like the odds of actually
getting a better outcome in the former circumstance than in the latter.
All right. Mike
Emanuel.
Q Thank you, Mr.
President. The number one concern for many Americans right now is
jobs. Taking a look at your budget, there are tax hikes proposed for
energy, for higher-income people, and also for replenishing the state
unemployment funds. Do you worry about the impact on jobs, sir?
THE PRESIDENT: Well,
actually, if you look at that budget, there’s a whole bunch of stuff in there
for job creation. I think some folks noted, for example, our
infrastructure proposals -- which would create millions of jobs around the
country -- our investments in research and development and clean energy have
the potential for creating job growth in industries of the future.
My belief that the high-end tax
cuts for -- or the Bush tax cuts for the high-end of the population -- folks
like me -- my belief is, is that that doesn’t in any way impede job
growth. And most economists agree.
We had this debate in
December. Now, we compromised in order to achieve an overall package that
reduced taxes for all Americans, and so I believe -- I continue to believe that
was a smart compromise. But when it comes to over the long term,
maintaining tax breaks for millionaires and billionaires, when that will mean
additional deficits of a trillion dollars, if you're serious about deficit
reduction, you don't do that.
And as I said, I think most
economists -- even ones that tend to lean to the right or are more conservative
-- would agree that that's not -- that's not the best way for us to approach
deficit reduction and debt reduction.
So I do think it’s important, as we
think about corporate tax reform, as we think about individual tax reform, to
try to keep taxes as simple as possible and as low as possible. But we
also have to acknowledge that, in the same way that families have to pay for
what they buy, government has to pay for what it buys. And if we believe that
it’s important for us to have a strong military, that doesn’t come for
free. We’ve got to pay for it. If we think that we have to take
care of our veterans when they come home -- and not just salute on Memorial Day
but we actually have to work with folks who have Post-Traumatic Stress Disorder
or Traumatic Brain Injury -- well, that requires services that are very
labor-intensive and expensive.
If we think it’s important that our
senior citizens continue to enjoy health care in their golden years, that costs
money. If we think that after a flood we help out our neighbors and our
fellow citizens so that they can recover, we’ve got to pay for it.
So the circumstance that's changed
-- earlier Julianna asked why I think I might get a deal. I think some of
the questions here generally have centered about what's going to be different
this time. My hope is that what's different this time is, is we have an
adult conversation where everybody says here’s what's important and here’s how
we’re going to pay for it.
Now, there are going to be some
significant disagreements about what people think is important. And then
that's how democracy should work. And at the margins I think that I'll
end up having to compromise on some things. Hopefully others will have
that same spirit.
Q As part of that
adult conversation, sir, what if they say deeper spending cuts before you
consider tax hikes?
THE PRESIDENT: Well, I think
it just depends on what exactly you’re talking about. And I think that
there should be a full, open debate with the American people: Are we
willing to cut millions of young people off when it comes to student loans that
help kids and families on their college education? Are we only serious
about education in the abstract, but when it’s the concrete we’re not willing
to put the money into it? If we’re cutting infant formula to poor kids,
is that who we are as a people?
I mean, we’re going to have to have
those debates -- particularly if it turns out that making those cuts doesn’t
really make a big dent in the long-term debt and deficits, then I think the American
people may conclude let’s have a more balanced approach. But that’s what
we’re going to be talking about over the next couple months. As I said, I
know everybody would like to see it get resolved today. It probably will
not be. (Laughter.) That’s a fair prediction.
All right, I’m going to take one
last question here. Jackie Calmes.
Q Thank you, Mr.
President. I’d almost given up there.
THE PRESIDENT: Oh, don’t give
up. (Laughter.)
Q You’ve
correctly suggested that the media can be impatient about seeing you -- seeing
both sides come to a deal, but this is your third budget, your third year of
your presidency. You’ve said many times that you’d rather be a one-party
-- one-term President if it means you’ve done the hard things that need to be
done. Now, I know you’re not going to stand there and invite Republicans
to the negotiating table today to start hashing it all out, but why not?
And since you’re not, though, what more are you doing to build the spirit of cooperation
you mentioned earlier needs to happen before there is bipartisanship?
And finally, do you think the
markets will wait two years?
THE PRESIDENT: I should have
written all this down, Jackie. (Laughter.) I’m running out of room
here in my brain.
Q I’m happy to
repeat my question. (Laughter.)
THE PRESIDENT: Well, let me
just speak to this generally. It’s true that this is my third
budget. The first two budgets were in the midst of the worst recession
since the Great Depression, so we had a different set of priorities. And
I said it at the time -- in each of those budgets, what I said was, the
deficit’s going up and we are compiling some additional debt, but the reason is
because it is so important for us to avoid going into a depression or having a
longer recession than is necessary.
Because the most important thing that we had to do in order
to limit the amount of increased debt and bigger deficits is to grow the
economy some more. So that was our priority. That was our focus.
This third budget reflects a change
in focus. The economy is now growing again. People are more
hopeful. And we’ve created more than a million jobs over the last
year. Employers are starting to hire again, and businesses are starting
to invest again. And in that environment, now that we’re out of the
depths of the crisis, we have to look at these long-term problems and these
medium-term problems in a much more urgent and a much more serious way.
Now, in terms of what I’m doing
with the Republicans, I’m having conversations with them and Democratic
leadership. I did before this budget was released and I will do so
afterwards. And I probably will not give you a play-by-play of every
negotiation that takes place. I expect that all sides will have to do a
little bit of posturing on television and speak to their constituencies, and
rally the troops and so forth. But ultimately, what we need is a
reasonable, responsible, and initially, probably, somewhat quiet and toned-down
conversation about, all right, where can we compromise and get something
done.
And I’m confident that will be the
spirit that congressional leaders take over the coming months, because I don’t
think anybody wants to see our recovery derailed. And all of us agree
that we have to cut spending, and all of us agree that we have to get our
deficits under control and our debt under control. And all of us agree
that part of it has to be entitlements.
So there’s a framework there --
that speaks, by the way, again, to the point I made with you, Chuck, about the
commission. I think the commission changed the conversation. I think they
gave us a basic framework, and within that framework we’re going to have to
have some tough conversations and the devil is going to be in the details.
But, look, I was glad to see
yesterday Republican leaders say, how come you didn’t talk about
entitlements? I think that’s progress, because what we had been hearing
made it sound as if we just slashed deeper on education or other provisions in
domestic spending that somehow that alone was going to solve the problem. So I
welcomed -- I think it was significant progress that there is an interest on
all sides on those issues.
In terms of the markets, I think
what the markets want to see is progress. The markets understand that we
didn’t get here overnight and we’re not going to get out overnight. What
they want to see is that we have the capacity to work together. If they
see us chipping away at this problem in a serious way, even if we haven’t
solved a hundred percent of it all in one fell swoop, then that will provide
more confidence that Washington can work.
And more than anything, that’s not
just what the markets want; that’s what the American people want. They just
want some confirmation that this place can work. And I think it can.
All right. Thank you,
everybody.
END
12:01 P.M. EST
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