For Immediate Release
Office of the Press Secretary
May 7, 2002

Press Briefing by Ari Fleischer

12:34 P.M. EDT

MR. FLEISCHER: Good afternoon. Let me give you an update on the President's day, and a statement, and then I'll be happy to take your questions.

The President began his day this morning with a phone call to Russian President Vladimir Putin. The phone call lasted approximately 15 minutes. The two Presidents noted the progress their negotiators are making on an agreement to reduce offensive nuclear weapons, and expressed hope that the agreement would be ready for their signature when the President travels to Moscow at the end of this month. The President told President Putin that he's looking forward to making the trip to Russia.

The two Presidents also noted Georgia's progress in its fight against international terrorists residing in the Pankisi Gorge, near the Chechan border. And President Bush also urged that Russia pursue a political settlement to the Chechnya conflict. And finally, the two Presidents also discussed the dispute over poultry, and the President urged a prompt resolution of that matter.

President Bush, also this morning, called Egyptian President Hosni Mubarak. The two spoke for 10 minutes. President Bush expressed his desire for peace and for long-lasting results that will be meaningful in the region. And he emphasized the importance of improving the human conditions for the Palestinian people. He also told President Mubarak that he welcomed Egypt's leadership and helpful role in the region.

Later this afternoon, the President will also call the Crown Prince of Saudi Arabia to continue his discussions about ongoing peace efforts in the region.

The President had, after his phone call to President Putin, his morning intelligence briefing, followed by his FBI briefing. The President participated in the event and gave a speech about the renaming of the Old Executive Building as the Eisenhower Executive Office Building. And early afternoon, the President will meet in the Oval Office with the Prime Minister of Nepal, where the President will reaffirm America's strong support for democracy in Nepal. They will talk about regional security issues, as well as economic and educational cooperation.

And finally, this afternoon the President will meet with Prime Minister of Israel Ariel Sharon in the Oval Office, where they will discuss ongoing progress and process of bringing peace to the region.

One announcement I want to give you -- or a statement, I'm sorry. The Permanent 5 members, or the Perm 5 members of the United Nations Security Council have agreed on a new system to implement economic sanctions on Iraq. This is a step forward. The Goods Review List promises to tighten controls over Iraq's illicit efforts to acquire material for its weapons of mass destruction programs, and allow for the freer flow of humanitarian goods to the Iraqi people. We expect the full Security Council to discuss, and then to vote in favor of this positive action this week.

The Iraqi people will benefit from this new system. However, they will fail to realize the expected benefits if Saddam Hussein continues to manipulate the overall Oil for Food program. Saddam Hussein cut off oil exports for one month, exacerbating problems with funding in a vital humanitarian program for the Iraqi people. He undermines the program with illicit oil sales and schemes to force buyers to provide cash kickbacks.

This program -- before it was referred to by the President as swiss cheese. The President thinks it is very effective now to have a tighter sanctions regime in place that prevents the Iraqi regime from getting access to material that can help it produce weapons or engage in war, while at the same time expressing America's longstanding humanitarian concern for the needs of the people of the region.

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

Q Ari, last night, Prime Minister Sharon thanked the United States for what he said was its support in blocking the U.N. investigation into the crackdown in Jenin. Was that an accurate description of the U.S. role, and do you accept that thanks from Sharon?

MR. FLEISCHER: Randy, I would want to look at a verbatim transcript of what the Prime Minister said before --

Q I have one. I can read from it if --

MR. FLEISCHER: I'd be happy to hear it verbatim and look at in a full context. But what the President made clear was that the United States wanted to have transparency in Jenin, the United States wanted to get to the bottom of what took place. And the United States, we thought it was unfortunate that it was not able to proceed.

Q Can you say equivocally that you didn't give Sharon a bye on the U.N. inspection team in Jenin in exchange for his cooperation to end the siege of Ramallah?

MR. FLEISCHER: I think that question was put directly to Dr. Rice and she said no.

Q Ari, is the President prepared to say specifically what he would like to see come out of this international peace conference? I know that's something they're going to talk about today, but a lot of the concerns have been raised by some of the Arab countries about why they don't want to sign on is that there's no goal at this point, other than to talk. Are we, before we make a real commitment to it, going to enunciate a series of goals that the administration wants to see accomplished?

MR. FLEISCHER: Well, here's the path to peace that the President has outlined, and it has multiple parts to it. And it involves, first and foremost, the President's summitry, which you've seen in Crawford with the Crown Prince, you should see it today with Prime Minister Sharon's visit; the phone calls that the President is making, with a call he'll make this afternoon to the Crown Prince of Saudi Arabia. That will be the 55th phone call the President has placed directly to an Arab head of state since he took office on January 20, 2001.

He has had -- the meeting with King Abdullah of Jordan tomorrow will be the President's 13th summit in person with an Arab head of state. His meeting with Prime Minister Sharon today will be his fifth meeting with the Prime Minister. So the President, on a personal level, is working the phones and holding meetings.

Secretary Powell has traveled to the region and is prepared to do so again when he thinks the time is right. And, as well, will be this meeting this summer -- much of the work, the principals and the players are all still being worked by the State Department in concert with many of our allies and friends.

So it's part of a multiple stage of diplomacy. And the President believes it's far, far better for the parties to be talking than to be engaging in war. And that's part of what this meeting is focused on.

Q Is the President seeking to attach conditions, monitoring of the distribution of aid to the Palestinians from the United States, from the EU, from Arab countries, in order to cure the problem of corruption which you've spoken of here? Is the President seeking to put teeth in that criticism by attaching conditions to the distribution of aid to the Palestinians?

MR. FLEISCHER: The President is very worried about corruption in the Palestinian Authority. He views this as an issue that the Palestinian Authority has got to confront and to take on, to make certain that the money that not only the United States provides, but that humanitarian concerns throughout the world, including the United Nations, provides to the Palestinian Authority indeed make it into the hands of the Palestinian people.

At all times, United States programs are reviewed to make certain that they go into the hands of the people who are intended to receive them. And this is something the President discussed in Monterrey. And so this will be an ongoing item of concern that the President and the State Department will continue to monitor and make sure it's done right.

Q But in talking to somebody like President Mubarak -- you said he discussed improving conditions for the Palestinian people -- is the President also telling Arab leaders that, when you disburse money to the Palestinians, monitor it, we'd like to see precisely where it goes and be able to follow the money trail?

MR. FLEISCHER: The core, Terry, of the President's message when he talks about Palestinian people and how to help on the humanitarian front with the Palestinian people focuses on a rebuilding of the Palestinian institutions. And the President wants to make sure -- and work with the Arab neighbors, as well as directly with the Palestinian Authority -- that as they rebuild and as they have financial help to rebuild, they rebuild with an eye toward transparency, democracy, fight against corruption. And it's an interesting way to measure the Palestinian Authority, because they have the ability here and today in the areas that they self-govern right now to demonstrate to the world their commitment to institutions that are dedicated to peace and stability based on the rule of law, not based on corruption.

And so this is an ongoing part of the President's message to leaders in the Middle East about how to help the Palestinian people to help themselves, how to make certain that the Palestinian people have a Palestinian Authority that is worthy.

Q And the last question on this, is this a way to grow or to cultivate a new generation of Palestinian leaders, outside of the Arafat circle, that might be more acceptable to Israel's interlocutors --

MR. FLEISCHER: Terry, it's just the right thing to do in the President's opinion. It's the right thing to do in order for the region to know that Israel and Palestine can live side by side in security and without risk of violence. And the best way to have neighbors live side by side is through countries that adhere to the rule of law, and not to the law of violence.

Q Is the President also monitoring the $10 million a day that we give to Israel, and all the arms and equipment, that they are really used in self-defense, after they actually have been used for aggression on the West Bank?

MR. FLEISCHER: The President's position is abundantly clear on that. As you know, he said that Israel has the right to defend herself. Israel exercised that right --

Q Is an invasion of another country -- or another people, that is, entity, self-defense? And invasion.

MR. FLEISCHER: Again, the President -- I refer you back to the President's speech of April 4th, in which he urged Israel to withdraw all its incursions.

Q Can you tell us, Ari, why the President favors an incremental approach to peace, as opposed to a comprehensive process as the last administration engaged in at Camp David?

MR. FLEISCHER: Well, the President, as I indicated, is pursuing the path to peace along multiple lines. And the President is determined, no matter how difficult it is, to continue down that path to peace. And he has put this path in a way that it can reach out into many directions to see which one would be the most fruitful.

There is no one magic approach to peace in the Middle East. If there was it would have been done and tried and successful a long time ago. The President does believe in learning his lessons from history and, therefore, he has established a multiple path to peace. And that involves, again, his personal efforts, and the meetings, the phone calls of Secretary Powell's, his travels to the region, importantly bringing in other nations, particularly Arab nations to help influence events in the Middle East, to help convince the Palestinian Authority about the proper route to go to secure peace.

After all, there are nations, Arab nations in the Middle East that have entered into peace agreements with Israel; there are successful previous examples. And it's a multiple choice that the President is making to pursue the path to peace among all these avenues.

Q What lesson did he learn from history?

MR. FLEISCHER: The President's point is that you have to move the process along in a matter that is consistent with the viewpoints of the participants in the process; that the United States can help be a partner for peace, but cannot force peace upon anybody. But we need to help all the parties -- the Israelis, the Palestinians, as well as the Arabs -- to reach an agreement that can be long-lasting.

Q Do you expect any new initiatives to come out of this meeting, specifically any kind of aid package for the Palestinians?

MR. FLEISCHER: No, I think this meeting is going to be part of the ongoing consultation process. I do not expect any new initiatives to come out of this.

Q Ari, how does the President hope to convince Prime Minister Sharon that he has to deal with Yasser Arafat? What's his message going to be?

MR. FLEISCHER: Well, the same way, Kelly, that the President has messages that he works very hard, and the State Department works very hard every day in convincing the Palestinian Authority and the Arab neighbors, as well -- through the long and patient art of diplomacy. I don't think anybody can look at one meeting as a magic moment. I think that people are going to want to look at the meeting today and the meeting he had with Saudi Arabia's Crown Prince, the meeting tomorrow with King Abdullah, phone calls he makes as all part of an ongoing, lengthy process which is starting to bear at least some fruit.

Q But when Mr. Sharon is expected to say that future negotiations between the Israelis and Palestinians cannot include Yasser Arafat, how is the President going to --

MR. FLEISCHER: Well, let's see. Allow the meeting to take place. Let's see exactly what the Prime Minister says to the President. You'll have your opportunity to ask questions of the President after the meeting, and as well, we'll provide other information once the meeting is over.

Q Final follow-up. Unrelated follow-up.

MR. FLEISCHER: Final follow-up, Kelly. Follow-up number seven.

Q Does the administration have any evidence that the Saudis have been giving money to Hamas or to the families of Palestinian suicide bombers? Does the U.S. have any evidence of that?

MR. FLEISCHER: Secretary Powell said Sunday when he was asked the exact same question, and nothing has chanced since then, we have raised that matter with the Saudis; the Saudis have given us assurances that they are not doing that. And the United States accepts those assurances.

Q Ari, the last time that the Nepali Prime Minister visited the White House was during President Kennedy's term, 40 years ago. This is the first time in 40 years that this leader is coming to the White House to meet with President Bush, this afternoon. What I'm asking you, you think his visit has not been overshadowed by more famous leaders today meeting with President Bush than this very tiny Hindu state in the world? And is President Bush really very well briefed on the problems in Nepal from Maoist terrorism, and also the economic, the economy and all that?

MR. FLEISCHER: Well, first of all, I think any time a visiting head of state has an opportunity to meet with the President of the United States in the Oval Office, they will be the first to tell you how welcome they feel, and what a nice reflection it is of the United States that no matter what is going on in the world, the United States treats visiting heads of state with dignity and grace, and welcomes them into the Oval Office. And that is exactly what the President will do with the Prime Minister.

Nepal is fighting a Maoist rebellion, and Nepal is an example, again, of a democracy. And the United States is committed to helping Nepal. There's a request by the administration for $20 million in the supplemental appropriations bill to help Nepal. The United States currently provides a couple million dollars of assistance toward Nepal. And so -- it's up to the press to determine what meetings are the most newsworthy, but the President welcomes all into the Oval Office.

MR. FLEISCHER: Jacobo? We're going to move it around.

Q Ari, first question, following up on Kelly's question -- Prime Minister Sharon has practically accused Saudi Arabia of financing terrorism. The United States claims that Saudi Arabia is helping the peace process, especially after the meeting with Prince Abdallah. How is the President going to convince Ariel Sharon that Saudi Arabia can play a major role in the peace process if that's what the Prime Minister believes?

MR. FLEISCHER: You know, in the Middle East there is nothing new about one nation having a statement about another nation that people differ about. That's been the history of the region for forever. The United States' special role, though, is to play the part of bringing the parties together. And that's why the President is welcoming Ariel Sharon to the Oval Office today, and that's why he'll welcome King Abdullah here tomorrow, that's why he called President Mubarak of Egypt, et cetera. And that will be the role of the United States, to constantly engage in the diplomacy required to take nations that begin, at least, with a publicly stated strong stance, and try to move them together.

Q Can I follow up on a different subject, Ari? It has to do with the very strong accusation that the U.S. government made yesterday against Cuba. Under Secretary of State John Bolton basically said that the USA believes Cuba is developing biological weapons and transferring expertise to rogue nations. Is there any proof of this, or this an assumption of the United States?

MR. FLEISCHER: No, it's not an assumption. I assure you that Secretary Bolton would not have said it if he did not have good cause, reason and fact to say it. That was based on sound analysis, and on information that is studied and available to the United States government.

Q But Cuba's been working with biomedical things for four decades. Is this something that has occurred lately, or does the U.S. believe this has been going on for years?

MR. FLEISCHER: Well, as you know -- you've covered this region for a long time -- analysts and even Cuban defectors have long cast suspicion on the activities conducted in Cuban facilities and their biomedical research. And so I assure you, it would not have been said if it was not said for good basis.

Q Ari, two unrelated questions. First, there were these reports this morning that former President Clinton may get appointed to a group that's going out to East Timor. Can you tell you tell us about this? And is he under consideration, and why this --

MR. FLEISCHER: There will be an event in East Timor that the United States will be sending a bipartisan delegation to attend. And it is not at the point yet where I can say something formal. Once it is a formal statement, I will be happy to issue it.

Q And you would expect that to be when?

MR. FLEISCHER: Sometime soon. I'll just leave it at that.

Q So the answer is yes. (Laughter.)

MR. FLEISCHER: Helen, you must be new in town.

Q You've learned. (Laughter.)

Q Back on the meeting with Prime Minister Sharon today. The Prime Minister, in his visits around town, has been talking about two different elements of his plan. One is working out physical partitions that would protect Israeli towns from suicide bombers. And the second, of course, is moving in much slower steps than you or Secretary Powell seem to have described before on the political track. Can you tell us what the President's position will be on each of those issues?

MR. FLEISCHER: Well, two points. One, allow the meeting to take place and we'll see precisely what the Prime Minister says. But two, the President is going to adopt an approach to bringing peace to the Middle East by continuing these conversations directly with the principals and with the parties. And I do not expect that you will hear or see the President tick-tock each and every development, or try to negotiate events through the press.

The President wants to continue to be a good ear to all the parties, so they know they can be welcome in the United States, and the United States will listen to what they have to say, and the United States will work its influence with all three parties to try to bridge gaps and bring people together. Sometimes the best way to bridge those gaps is to do so quietly and diplomatically, to listen, not prejudge. And that's what the President will do, that's his approach.

And you know, again, there are going to be times, I think, where you will see, and you will know it, good success as a result of the President's quiet efforts. They're going to -- that was the case, of course, in the resolution of the situation in Ramallah. There are going to be other times where there are going to be setbacks, where it's going to be hard to bring the parties together. And that's, again, why the President knows that this process will be lengthy, but he will be dogged in trying to bring about successful results.

Q Ari, as the President tries to bring these sides together, though, he seems to have settled on a few things -- that there's a role for Arafat, there's a role for the Saudis, we need to keep the goal of a Palestinian state in mind and get there -- all of which Sharon doesn't seem to buy into. How does he -- what kind of leverage does he have to try to bring the Prime Minister to his point of view? And will that be one of the purposes of today's meeting?

MR. FLEISCHER: Well, again, that is the essence of diplomacy. But I think if you had said, as some did shortly after the President's speech in the Rose Garden April 4th, that the Israelis say they won't withdraw -- and, of course, after time, after the diligence and the pursuit by the President, a satisfactory result was concluded to Israel's operation in the withdrawal. From the President's point of view, they did listen.

So not everything in the Middle East moves at the speed of press deadlines. But it will continue to move at the speed of the partners for peace that the President is seeking to assemble as he tries to bring the parties together.

Q Following on that, the President is totally satisfied that Sharon met his request for -- I forget the exact words, as soon as possible?

MR. FLEISCHER: What I was referring to is that -- if you recall, right after the President's speech on April 4th, we were in Crawford, and I said what's going to happen next is the parties are going to take time, the nations are going to take time to digest what the President said in his remarks. And that is the nature of the Middle East. There are going to be a series of events that take place that each nation and the various parties are going to weigh carefully, listen to. I suspect you'll hear some things in public that the nations may not say in private. And that is all part of the process of trying to quietly bring people together in the Middle East. And that's going to be the ongoing efforts by the President.

So the President's message to Israel has been and will continue to be that Israel needs to focus on a broader vision of how to create an environment for an Israel and a Palestine to live side by side. The President believes it is entirely in the interest of the Israeli people to create that environment so the Palestinian people can have a state that is free from corruption, that's based on the rule of law, that develops where Israel does not have to only worry about security, but Israel, like Israel has done with Egypt and with Jordan, can develop into a peaceful relationship with neighbors, where there used to be hostility.

Q Ari, does this action that you announced today about Iraq address in any way the reported use of stealth, under the table surcharges that Iraq's been putting on its oil exports to get around the earlier sanctions and the earlier restrictions on where any oil profits could go?

MR. FLEISCHER: You may want to take a look at the exact text of what is being passed out at the United Nations. And the purpose of this -- and there's a whole list of goods that will be permissible -- and the whole purpose of this is to address what's been one of the greatest weaknesses in the sanctions policy, which is it was not being followed.

The President believes it is far, far better for the world to know that there are certain products that absolutely will not be allowed to go into Iraq because they can be used for military purposes or for the purposes of developing weapons of mass destruction; while there will be other goods that can and should go into Iraq to help the humanitarian needs of the Iraqi people.

The previous sanction policy was not effective because it was so riddled with loopholes. And as a practical matter, that, as the President said repeatedly, was really a sanctions policy that resembled Swiss cheese. And this is a successful result of the United States' efforts that have been long going at the United Nations. If you recall, some six months ago, we were very close to getting this done. Now we've worked very closely with the Perm 5, and Russia, again, has played a very constructive role in helping to reach an agreement at the United Nations.

Q To what extent is this sort of a run-up to tightening diplomatic and military sanctions, if you will --

MR. FLEISCHER: I think you have to look at this as an event in and of itself. This is something that gets reauthorized every six months by the United States. The reason the U.N. set this as a six-month renewal is so they could always come back and look at this in and of itself, to make sure that it was working, and if not, to make adjustments. They are now making these adjustments.

Q Before we get back to the Middle East, I want to ask you a quick question about the supplemental, if I may. Already the House, with the leadership of Chairman Young, is talking about $3 billion more than the President was talking about. It hasn't even gotten to the Senate side yet, where it's sure to have many more billions added to it. What is the administration's current thinking about how large a supplemental it can accept?

MR. FLEISCHER: Well, the House Appropriations Committee has not yet marked it up. The administration is reviewing it carefully. And we'll be taking a look at obviously the line items within the supplemental appropriation bill, as well as the aggregate spending figure. The President's message to the Congress is to hold the line on spending. We are a nation that has a deficit. And it's important for Congress not to add excessive spending to make the deficit worse. There are legitimate defense needs that have to be addressed that the President proposed funding for; homeland security needs, as well. And so we will be taking a very careful look. And stay in touch, is what I can tell you for now.

Q I wanted to shift to the Middle East. I'm not quite clear how the administration envisions this process --

MR. FLEISCHER: Is this a follow-up to your previous question?

Q Correct. I indicated at the outset that I wanted to insert that before we got to the Middle East.

MR. FLEISCHER: Is this a related follow-up, or an unrelated follow-up? (Laughter.)

Q It's an unrelated follow-up.

Q The best kind. (Laughter.)

Q The administration -- it's not quite clear to me what the administration -- how it envisions the process going forward. There's a lot of discussion about whether or not the idea of a complete peace agreement should be on the table as an incentive for Palestinians to look forward to something other than a constant battle with the Israelis. How does the administration view the process from here on out? Do we need a new peace agreement on the table quickly in order to create an incentive for the Palestinians?

MR. FLEISCHER: All of this is going to be discussed in a series of meetings and phone calls that the President is having. There are a variety of different approaches, and the President wants to listen carefully to various people's ideas about how to move forward. And as he moves forward on what I describe as his path to peace that has multiple avenues to it, the President will continue to listen carefully to people's ideas.

And one area, again, that I strongly urge you to keep your focus on is, in addition to what has traditionally been done involving the direct talks with the parties, one interesting development that has been present since January 20, 2001 is the constant work that the President has done and his diplomats have done with other nations in the region, as well as Europe and others. There is a view that to create the environment for peace in the Middle East, there is a role that others can play to help the parties to enter into political talks and political dialogue.

Make no mistake, the President believes that to bring peace to the region, there has to be a focus on the political process, so that we can go beyond security, while making sure that Israel has its security needs addressed, because it would be much harder to do without security needs being addressed, but a real return to a focus on political events, political settlements -- the speed of which will be determined in good part by the willingness of the participants to move with the President.

Q One of the things, though, that's not quite clear is you're talking about democracy, anti-corruption, that sort of thing among a new Palestinian Authority. How does the administration envision that happening? Are you -- do you see new elections among the Palestinians? Are you going to --

MR. FLEISCHER: Well, first and foremost, it will come from the Palestinian people. I think there's no question that prior to the recent surge in the violence, Yasser Arafat was under a lot of pressure from Palestinian people to end the corruption. There was a tremendous amount of dissatisfaction by the Palestinian people, with corruption within the Palestinian Authority, with money that should have been given to the Palestinian people that ended up abroad. As a result of the violence, that focus of the Palestinian people shifted onto matters of security, and therefore that issue has subsided.

What the President is focused on now is reconstruction, a way to help the Palestinian institutions be recreated so that people again focus on what is natural in life. And what is natural in life is economic opportunity, is education for children. It is not violence. And as the violence fades, there will be a gradual shift back to the Palestinian people asking what type of government will represent us as we try to educate our children, as we try to have jobs and economic opportunity?

Israel plays a role in that, as the President has talked about, at the checkpoints, making sure that the Palestinian people have opportunities for economic advancement. That, too, will be made easier when violence subsists, because, therefore, Israel will be more willing to allow people to come through the checkpoints.

So the President's focus is on the rebuilding of the Palestinian infrastructure in a way that the Palestinian people can have a Palestinian

Authority that is worthy of their goals. And those goals will be easier achieved if the Palestinian Authority focuses on rule of law and a fight against corruption.

Q I have a question on Kyoto and then a follow-up on something you just said. Now that the administration has renounced this International Criminal Court, there are reports that the U.S. might de-sign or actually pull out of Kyoto, which it hasn't done formally yet. Any comments on Kyoto?

MR. FLEISCHER: Well, first of all, just on the language, to be specific, on the International Criminal Court, it is not a de-signing. That's a legal matter. It has the effect of withdrawing the United States from any participation. And on that point, too, I just want to bring to your attention a document that was submitted with the signature of President Clinton on December 31, 2000, in which President Clinton himself, on the ICC, referred to it as a treaty with significant flaws. And he went on to state, "The United States should have the chance to observe and assess the function of the court over time, before choosing to become subject to its jurisdiction. Given these concerns, I will not and do not recommend that my successor submit the treaty to the Senate for advice and consent until our fundamental concerns are satisfied."

So that treaty had been signed by President Clinton, as he called it, with significant flaws. And he urged his successor not to submit it. And I have heard nothing new on Kyoto. I think that matter has been dealt with. The President has already announced what he views as an alternative to Kyoto that will help reduce greenhouse gas emissions.

Q On another matter, FERC released some documents yesterday suggesting that Enron manipulated electricity prices during California's energy crisis last year. Has the administration rethought its attitude toward deregulation in light of these revelations?

MR. FLEISCHER: Well, I'm glad you asked that, because it does cast a light on something very interesting and very important in terms of the administration's ongoing commitment to take action if there is any wrongdoing in market manipulation. And last May, the President called on FERC to be vigilant in protecting consumers. And we've always said that if anybody is illegally manipulating markets, they need to be held accountable.

And these documents, which as you accurately point out, were released by FERC, an independent agency of this government, were released as part of an ongoing investigation launched by this administration through FERC, which has been something that the President has noted and he expects the investigation will be vigorously pursued, wherever it may go.

As a general matter, the administration supports very tough enforcement of the laws that protect consumers, and that applies to the energy markets, as well. If you take a look at the legislation that is pending on the Hill in the energy bill and what we submitted to the Congress, the legislation the President proposed asked Congress to enact tougher penalties to prevent market manipulation. And many of these provisions, I'm pleased to note, are in the Senate bill.

Let me give you some specificity to that. We have proposed to the Congress that they increase criminal penalties for violating -- if anybody's found to have violated the Federal Power Act, that the penalties be increased from $5,000 to $1 million; and in some cases, from $500 per day to $25,000; and that prison terms be increased from two years to five years. Those are all items that we had proposed that we will fight for in the conference that is now pending up on the Hill. We have asked to make sure that FERC has the authority it needs to go after -- to do its job. It's also important to prevent the opportunity for market manipulation by modernizing and expanding the electricity grid, and encouraging investment in new, clean generation. These issues are pending before the Congress now, and the administration will continue to work that issue. It raises important issues.

Q Do you support Senator Feinstein's call for a criminal investigation of Enron?

MR. FLEISCHER: Anytime any individual asks the White House to make a comment about taking a stand on a specific criminal matter, the White House is not the proper agency to make determinations about who should and who should not be criminally prosecuted. Those issues, I think the American people recognize, belong in the hands of the professional prosecutors. It is their judgment to make that. I note to your attention that FERC is investigating.

I'm going to keep moving around. People haven't had it yet. You've had one before?

Q David asked it.

MR. FLEISCHER: Okay. Mark?

Q Thank you, Ari. King Abdullah's role. It seemed that when President Clinton found the Mideast peace negotiations at an emotional and difficult spot, he'd tend to bring in King Hussein. Do you see Abdullah playing a similar sort of go-to role in this process?

MR. FLEISCHER: This is why I drew your attention to the fact that the President has called 55 Arab heads of state since he became President -- 54; it will be 55 this afternoon. This has been an ongoing part of the President's diplomacy. The President recognized from the very beginning that there is a role to play for the other nations in the region. Clearly, that includes Jordan.

Jordan has a peace treaty with Israel. Jordan has been a very helpful influence in the region. There is a role for Jordan to play. And there's also a role for Egypt to play. They have played a leadership role. Saudi Arabia, interestingly now, with the role that they played just a few weeks ago and continue to play; Morocco. There are a number of nations that have been helpful and productive. And the President remains and will remain in close touch with them, as well as Secretary Powell doing his hard work, too.

Q Ari, you said before that we had raised with the Saudis questions about this support for suicide bombers, they'd given assurances and we had accepted those assurances. Does that mean that you do not believe the material the Israelis presented proves anything, or could that change our belief in the Saudi assurances?

MR. FLEISCHER: Again, I just refer you to what the Secretary said. And we have received those assurances directly from Saudi leaders at the highest levels.

Q Can I just follow on that?

MR. FLEISCHER: Campbell, we have an order. You were called on earlier.

Q Another question related to the Saudis. You've been stressing today the need for the Palestinian Authority to have a democratic, open rule, respect of human rights. Saudi Arabia is not a democracy, does not have human rights, doesn't even let women drive. Do the same standards that apply to the Palestinian Authority now also apply to Saudi Arabia?

MR. FLEISCHER: The President made clear in his State of the Union address the important need around the world, no matter where in the world, for values that represent the best path to peace, as well as for fundamental fulfillment of individual rights that are eternal human values to be implemented throughout the world, and that includes Saudi Arabia.

Q In all of the hours that General Zinni and Secretary Powell have spent talking with Yasser Arafat, they surely must have mentioned Osama bin Laden and our deep concern about him. And if Arafat ever, in any way admitted that bin Laden is a terrorist, that would have been very good news that you would surely have told us about, Ari. And my question is, but the fact is that Arafat has never admitted that bin Laden is a terrorist. Isn't that true, Ari? Or can you, from your remarkable memory, cite any time where he has admitted that Osama bin Laden is a terrorist?

MR. FLEISCHER: Lester, I do not chronicle every statement made by Yasser Arafat to tell you whether he did or didn't. But the point is, the President has said Yasser Arafat has not earned his trust, that Yasser Arafat has not done enough to fight terrorism and to crack down on corruption. And that's the more important question for President Bush.

Q Wait a minute, I had my follow-up. Does the President believe that our airline pilots should not be allowed to carry any sidearms?

MR. FLEISCHER: No change in the President's position.

Q What is the President's position? He believes --

MR. FLEISCHER: The President has listened to his security experts and aviation experts who have come to the conclusion that they should not.

Q I just wanted to clarify what you said earlier to Deb's question. On the Saudi question, you keep referring us back to the Secretary's comments. But this morning he said that the President hadn't yet seen the documents, that he was going to look them over.

MR. FLEISCHER: That's true, as well.

Q So he still hasn't seen the documents?

MR. FLEISCHER: No, I presume that they will be brought with the Israeli delegation. The President himself has not seen them.

Q This morning you said that you would looked them over, and then at that point make a decision as to whether you needed to raise any additional concerns with the Saudis. Does that still hold?

MR. FLEISCHER: Yes, it does.

Q Because what Powell was saying was, everything is fine, we take them at their word.

MR. FLEISCHER: Well, we can take a look at the documents and see, as I indicated this morning, if there is anything that we need to raise with Saudi officials.

Q A quick follow-up on the Middle East issue. On April 4th in his Rose Garden statement, the President called on Prime Minister Sharon to cease the construction of settlements. How important is that issue in the near-term to the President's search for peace? And what does he expect of Ariel Sharon, who said he doesn't intend to do that?

MR. FLEISCHER: That's one of many important issues. And it's something that both Secretary Powell and Dr. Rice addressed when they said that this is something that we will be talking to the Israeli government about. We already have had conversations under the Mitchell plan, as you know, that did call for an end to settlement policy. It is one of the issues that has to be addressed as part of what I referred to earlier, as the political dialogue -- the discussion and a resolution of border issues, a discussion and resolution of checkpoint issues, a discussion and resolution of settlement issues. All of those are part and parcel of the political talks that are going to be the key to getting real, lasting progress done.

Q How does the President intend to develop a reconstruction program for the Palestinians? And secondly, with all the listening and talking, the initiatives that are going on for peace in the region, is Mitchell and Tenet and all that off the table now, or are they still part of the process?

MR. FLEISCHER: No, they're still part of the process. And again, take the words of Tenet and Mitchell out of it. Tenet equals security, Mitchell equals political process, political talks. Those are two fundamental pillars to achieving peace in the Middle East. You have to have both. And so they both apply, just as much as before.

Q Okay, then the Palestinian aid, is there a plan yet in mind for developing a program?

MR. FLEISCHER: The United States provides, with the recent $30 million increase in aid for the Palestinian people, the United States now provides $110 million annually for the Palestinian people, as well as the support the United States gave to the Oslo Conference some three weeks ago, which also has provided a humanitarian effort worldwide to bring aid to the Palestinian people.

Q No new conference or --

MR. FLEISCHER: I think these are all parts of the ongoing discussions. The President talked to President Mubarak about it today, for example. And I assure you that the levels -- appropriate levels at the State Department and other agencies of the government, that's where it's being worked out.

Q Ari, as part of the interim steps that Israel would like to propose to the White House, one of them is to grant Palestinians a state over areas that they already control, pushing down the road the thornier issue about where do you draw the final status border. In the President's vision of what a Palestinian state looks like, does he believe it could start small and expand?

MR. FLEISCHER: John, this is where I indicated earlier, I'm just not going to tick-tock or give the play-by-play on everybody's initiative and every specific level of how to bring peace to the region. What the President wants to do is create an environment where different people can bring their ideas forward, and then quietly bring people together around the ideas that lead to peace. And, unfortunately, when it comes to diplomacy, one of the best ways to do that sometimes is quietly. That's the best way to be effective. So you're not going to hear the President give a thumbs-up/thumbs-down to each and every specific proposal that anybody makes. He's going to continue to play America's unique role, which is to bring people together around the principles that the President has outlined.

Q When he talks about a Palestinian state, what's he talking about?

MR. FLEISCHER: He's talking about a Palestinian state whose precise borders and the timing of which it would be created would be determined in negotiation with the principals in the area.

Q Ari, does the President still have confidence in Army Secretary White? At issue is whether the Army engaged in misconduct, lobbying Congress to maintain funding for this weapons program --

MR. FLEISCHER: The President -- yes, the President has confidence in Army Secretary White. He thinks he's doing a good job at his post.

Q So he's ruled that the Army Secretary did not engage in any misconduct when it comes to lobbying for this weapons program?

MR. FLEISCHER: Well, the President makes no such rulings. But that's something that the Inspector General of the Department of Defense is taking a look at. But that's the answer to your question.

Q You were really telling us today that a nuclear treaty, nuclear reduction treaty is going to be signed in Moscow, weren't you, really? Has it a new momentum that suddenly it's --

MR. FLEISCHER: Well, as you remember when Foreign Minister Ivanov was here and the President and the Foreign Minister discussed the prospects, how the President said at that time he was hopeful we could get an agreement. There's been ongoing continued diplomacy.

This is another area where the President really worked very hard and quietly with President Putin directly -- with President Putin directly to achieve a reduction in our offensive weapons to between 1,700 and 2,200 weapons, and then to codify the agreement. And the President always hoped he'd be able to codify it during his visit to Russia. That's something the President has said. And he, as well as the experts in the State Department, have worked very diligently behind the scenes to make that a reality. But the President still is hopeful it will happen. But as he discussed with President Putin this morning, good progress continues. And that's an encouraging sign. That will be a significant development.

Thank you.

END 1:15 P.M. EDT

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