The White House, President George W. Bush Click to print this document

For Immediate Release
Office of the Press Secretary
January 6, 2005

Press Briefing by Scott McClellan
The James S. Brady Press Briefing Room

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Press Briefing
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12:44 P.M. EST

MR. McCLELLAN: Good afternoon, everybody. The President had a good discussion earlier today with Republican congressional leaders on some of our big priorities for the upcoming year. A number of priorities were discussed at this meeting in the Cabinet Room, including tax reform, lawsuit reform, the budget, and Social Security.

This afternoon, the President looks forward to meeting with a bipartisan group of congressional leaders to talk about the importance of acting as soon as possible on class action reform, and helping to stop lawsuit abuse in this country.

Then, following that meeting, the President and Mrs. Bush and Barney look forward to welcoming Miss Beazley to the White House. And you all will be there for coverage of that at 2:15 p.m.

Q Is this a state arrival? (Laughter.)

MR. McCLELLAN: With that, I will be glad to go to questions.

Q Scott, I know we talked about this earlier, but can you give us your reaction to the move by Democrats to challenge the result in Ohio?

MR. McCLELLAN: Sure, and we did discuss it earlier. I think the American people spoke very clearly on election day. And the election is behind us. The American people now expect their leaders in Washington to focus on the big priorities facing this country, and to act on those priorities. It is time to move forward, and not engage in conspiracy theories or partisan politics of this nature.

Q Follow-up, Scott, on that?

MR. McCLELLAN: No, let me go over here to -- go over here.

Q Scott, on tax reform, you're talking about it now. Does that mean that you actually intend to do something this year? Because experts are telling me you have a better chance of getting tax reform during an election year, because it's so popular.

MR. McCLELLAN: The President wants to move on tax reform now. And the first step to moving on reforming our tax code and making it simpler and fairer and making it a code that encourages economic growth and job creation is to put a bipartisan advisory panel in place. The President will be ready to move on that very soon.

And that bipartisan advisory panel is going to look at a number of ideas for meeting the President's principles when it comes to reforming our tax code, the ones that I just mentioned. And he'll look forward to seeing what they report back to the Secretary of Treasury, and the Secretary of Treasury will be making some recommendations to the President. We're already talking about this issue with members of Congress and the legislative timetable. And we'll continue to do that. The President believes this is a very important priority in this coming Congress.

Q Scott, there have been a couple stories suggesting that the White House was going to move slowly on tax reform and even on Social Security reform. What did the President tell Republican lawmakers today?

MR. McCLELLAN: We're going to move in partnership with members of Congress to get these priorities done. These are high priorities for the President. I'm not going to get into talking about legislative timetables. That's for members of Congress to talk about. They're the ones who ultimately set the timetable for the consideration of legislation. But you've heard the President make it very clear that we need to act now to strengthen Social Security and help our younger workers realize a greater rate of return on their benefits. And we need to act now to reform our tax code and make it simpler and fairer. It's an outdated, complicated mess -- as the President has talked about. And so those are matters that we're discussing with congressional leaders of both parties.

Q Now -- I understand you don't have your tax reform commission yet, or the results of their work, but the Social Security Advisory Commission's work was three years ago. You've had that in hand for quite a while, how does the President plan to proceed on this? How quickly, what does he plan to do to put this issue before --

MR. McCLELLAN: The President is already proceeding on this issue. He had a meeting a few weeks ago with bipartisan leaders in Congress to talk about the crisis that we're in when it comes to Social Security. He had a very good discussion earlier today with members of his own party on that issue, as well. Social Security is in a crisis situation. We need to work now to strengthen it and fix it for future generations. We want our children and grandchildren to be able to realize the benefits of their own retirement savings. And we want them to have the best possible system and realize the greatest possible return on their retirement savings and have some ownership in the system, as well. Those are important principles that the President outlined.

We have a unique opportunity to seize this year. The American people just spoke in an election, and they made it very clear the priorities that they support. The Social Security -- strengthening Social Security was a central part of the President's campaign; reforming the tax code was a central part of the President's campaign. And now it's time for members of Congress to move forward on these priorities, and we're going to work very closely with them as we do and in a bipartisan way. That's what the President wants to do.

Q You often talk about not negotiating with yourself on specific other things that could be done with Social Security, aside from personal accounts. Do you recognize, as the White House memo suggests, that there have to be other things aside from personal accounts to fix Social Security? And how will you proceed on that? Democrats on the whole who have dealt with, also say, no one wants to take a position on any particular thing because, as the late Congressman Matsui said recently, someone will hang it around your neck. But what do you do to sit down with members of Congress and get them to look at and agree on this?

MR. McCLELLAN: The President believes this is one of the biggest priorities and biggest challenges facing the American people. And he is committed to doing -- solving this problem in a bipartisan way. We are open to all ideas and proposals that are consistent with the President's principles. We are not closing doors, we are looking at a number of ideas for solving a very real problem. The President has made his principles very clear that should guide us as we move forward on reform.

And those principles are that younger workers should have the option of setting aside some of their retirement savings in personal retirement accounts. We should not be increasing payroll taxes. And the President believes it's important that those at or near retirement see no changes. And the President wants to move forward in a bipartisan way on this important priority. And that's why we're reaching out to members on both sides of the aisle who recognize that we have a very real problem facing us and that now is the time to seize -- to solve that problem.

Q Can I just follow on that? There have been reports that the President is not going to come out with his own plan until the end of February. Is that correct, that it's going to take that long?

MR. McCLELLAN: I would say that there haven't been any decisions about a specific proposal at this point. I just said that we're in the process of discussing a number of ideas with members of Congress. We're listening to ideas that they have, and we're open to all ideas and proposals that are consistent with the President's principles. We don't want to close doors at this point; we want to discuss ways we can solve this problem together. But the first thing we have to do is come to a common understanding of the situation that we are in and the problem facing Social Security, and that's what the President is talking about right now. He's talking to the American people about it, he's talking with members of Congress about it. He had a good discussion about some of these issues earlier today.

Q But is it true that you're not going to make these decisions until -- for a couple months?

MR. McCLELLAN: We're going to discuss timetables with members of Congress and move forward together, in a bipartisan way, to get this done. But there have been no decisions made regarding specific proposals at this point.

Q Scott, can I follow up? The memo, the email memo that Jim just referenced is from Peter Wehner -- he's the White House Director of Strategic Initiatives -- and it's making its way around the Hill. First, this is an authentic memo from one of the President's top aids, is it not?


Q In it, he says, that, "we're," the White House, is "going to take a very close look at changing the way benefits are calculated. If we don't address this aspect of the current system, we'll face serious economic risk." So it's fair to conclude the White House is going to change the way Social Security is --

MR. McCLELLAN: I think what's important in this argument, Terry, is that we should not be selective in how we approach it and talk about it to the American people. There are, really, just a couple of options facing us on Social Security, when you boil it down. We can either do nothing, and let the current system continue as it is -- and the current system right now is unsustainable, and workers are facing either massive tax increases or massive benefit cuts -- or we can act now and strengthen Social Security, and help workers have a new guaranteed benefit so that they can realize a greater rater of return on their benefits. Because right now, under the current system, younger workers are facing massive benefit cuts if we do nothing.

And that memo says a lot more than just what you pointed out there.

Q It does, but one of the questions --

MR. McCLELLAN: And I think that the -- well, let me --

Q -- that we have and that a lot of Americans have is, what does it mean when you say we're going -- we need to act now. And here's one of the President's top aides saying, it means we're going to change the way benefits are done.

MR. McCLELLAN: The -- let me tell you what it means. That memo -- or that email is referring to the serious nature of Social Security and the crisis situation that we're in. It talks about how right now we have an unfunded liability of more than $10 trillion under the current system, and that's why we need to act to solve this problem. But the President is open to all ideas and proposals that are consistent with his principles at this point. He has not made any decisions.

And the Social Security Commission that was appointed by the President, and was bipartisan, led by the late Senator Patrick Moynihan, looked at a number of these issues. And they talked about the importance of acting to solve this problem now. And they talked about the benefit of allowing younger workers to invest some of their own money into personal retirement accounts, and how they can realize a greater rate of return on their accounts, or on their own savings.

Remember that the Social Security Commission pointed out the great success story with the thrift savings plan. They called it a "singular success." That's where federal employees have been able to have a control over their own dollars and invest those in safe investments and realize a great rate of return on those investments. And they've seen huge increases in the return on their investments under that -- under the Thrift Savings Plan.

Q And one more question about Mr. Wehner's memo. He says -- and this is to conservative members of Congress -- he says, "If we succeed in reforming Social Security, it will rank as one the most significant conservative governing achievements ever," and he goes on to say that -- he says that the Democratic Party is the party of the past on this issue. "For the first time in six decades, the Social Security battle is one we can win. And in doing so we can help transform the political landscape of the country." Is this a political effort by the President to strengthen the Republican Party?

MR. McCLELLAN: Again, it says more than just what you pointed out, I would just say.

Q But it also says this.

MR. McCLELLAN: But this would be an important achievement for all the American people.

Q And for the Republicans.

MR. McCLELLAN: This is critical for our future generations, our children and grandchildren in helping them have a significant retirement savings when they do, ultimately, retire. I think that if you look at some of the information that has been put out, a younger worker at age 30 right now is facing massive benefit cuts under the current system. That's why we need to act.

Let me just read to you one other thing to point out the situation that we're in: "And all of you know, to a greater or lesser degree of specificity, every one of you know that the Social Security system is not sound for the long-term so that all of these achievements -- the economic achievements, our increase in social coherence and cohesion, our increase in efforts to reduce poverty among our youngest children -- all of them are threatened by the looming fiscal crisis in Social Security. This is our obligation to you and, frankly, to ourselves. And let me explain that. The fiscal crisis in Social Security affects every generation. We know that the Social Security trust fund is fine for another few decades, but if it gets in trouble and we don't deal with it, then it not only affects the generation of the baby boomers and whether they'll have enough to live on when they retire, it raises the question of whether they will have enough to live on by unfairly burdening their children, and therefore, unfairly burdening their children's ability to raise their grandchildren."

That was February 9th, 1998 in remarks given by President Clinton. This has been a problem that has been looming for quite some time. We know that by 2018, that the benefits being paid out are going to exceed the taxes coming into the system. We know that more people are retiring -- living longer and retiring, and that there are less workers to support those retirees. That's the crisis that we face. It's very real. We should not pass it on to future generations because it only gets worse over time. And the President is committed to doing this in a bipartisan way and he's going to listen to ideas from people who are committed to solving this problem now and not passing it on to future generations.

Q Does he agree with his top aide that this is a huge political opportunity for the Republican Party?

MR. McCLELLAN: This is a huge opportunity for the American people. That's what the President believes.

Let me go back here. John, go ahead.

Q Okay. Two brief questions. First, I feel like this is almost a deja vu from the morning session -- was immigration discussed at any of the meetings between the President --

MR. McCLELLAN: No. No, it was not discussed this morning.

Q Second point, I'd just like to get this behind us -- you may have addressed it earlier, but for days when the President was in Crawford, there were so many reports that he didn't respond quick enough to the tsunami and the tragedy of the victims there. It seemed to me as though I heard the report, and in a very short time on the same day he was expressing the feelings of he and the First Lady. Has anyone put out an exact timetable of when he made his statement and when the report came?

MR. McCLELLAN: I think that that's all well documented. The United States government was acting immediately in the aftermath of this grave human tragedy. The United States went into action mode on a number of fronts. We started forming a core group of nations to immediately begin moving supplies into the region and distributing relief and aid to those who were suffering in the immediate aftermath. And that core group now is going to be merged into the United Nations efforts. We've been coordinating closely all along with the international community.

But the reason we were able to establish that core group in the first place is because of the relationships that the President has built with leaders in those countries. We were able to come together very quickly -- in a matter of hours -- with Japan, and Australia, and India, and then I think Canada and the Netherlands joined the core group. And that's because of the strong relations we have built over the last few years. And those countries were able to come together and quickly get in place a way to distribute aid to those who were suffering and quickly help try to save lives in the region. So the President was acting. He didn't have to go out in front of the cameras to talk about it. He was focused on how can we help those who are suffering, and how can we get aid to the region as quickly as possible. And we are doing it on a number of fronts. And you've since heard from him on many other areas.

Q Scott?

MR. McCLELLAN: Go ahead.

Q Back on the memo, as well as some other questions that have been raised, some people are saying that memo, in effect, somewhat uses scare tactics to get the American public to be convinced that it's more of a crisis state than really what it is. And is that -- what do you say about -- what does this administration say about that and how you're trying to convince the American public --

MR. McCLELLAN: I dismiss it. It's talking about the serious nation of the problem if you look at it.

Q Scott --

Q But, but wait a minute, wait a minute, wait a minute. But using things -- using key words like you're going to "go up against the iceberg" and things like that? I mean --

MR. McCLELLAN: Social Security is in a crisis, April. I just talked about the reason why it is. And when you're talking about more than $10 trillion being needed to fix the system, I would say that that is a very serious problem.

Q And then the second question real quick, going back to Ohio, going back to Mark's question, you talked about conspiracy theories; people need to let go of conspiracy theories. Well, does the administration understand that the voting system still in America has problems, and that is some of the reason why there are people who consider conspiracy theories? What do you say to the fact that people are considering issues that the elections process is flawed? You have machines that are flawed, that you don't have a paper trail. What do you say about that?

MR. McCLELLAN: How many times were the votes counted in Ohio?

Q Excuse me?

MR. McCLELLAN: How many times were the votes counted in Ohio?

Q But that leads to the fact that --

MR. McCLELLAN: How many times were the votes counted in Ohio?

Q That leads to the fact there was a problem. What do you say about that?

MR. McCLELLAN: That the decision in the election was very clear. It was a decisive win, and the American people want us to get about doing their business. That's what I say.

Go ahead.

Q But when can we get the elections process right for --

MR. McCLELLAN: I'm going to move on. Go ahead.

Q -- for us not to have to keep recounting like Ohio?

MR. McCLELLAN: Go ahead.

Q Scott, Chirac said today he's going to come to Washington this year to meet with Bush and try to repair the relationship. What needs to be done? What does he need to say to repair that relationship?

MR. McCLELLAN: First of all, we are working with the French government on a time for President Chirac to come to Washington and meet with the President. The President made it very clear at the outset of the post-election period that he was going to be doing more to reach out to our European friends and allies so that we can work together to solve common problems that we face. There's some big challenges we have abroad -- not only at home, but abroad, as well. And we need to continue to move forward on those challenges together. He talked about a number of the key areas on the foreign policy side where he would focus in his remarks in Canada, when he made that trip in late November. And so we're working on a timing for that visit. The President also looks forward to seeing him in Brussels, as well. And we'll be talking about the common challenges that we face, and how we can work together. There are many areas where we already work together.

Q Are there left-over bad feelings about his opposition?

MR. McCLELLAN: I think everybody is focused on how we can move forward together.

Go ahead.

Q Scott, it's not just the Democrats who say that the White House is overstating the crisis. I'm wondering if you could just tell us about the meeting this morning, what sort of reaction he got, was it a receptive reaction for the possibility of moving to price indexing, because the Republicans are split on this issue as well?

MR. McCLELLAN: Corbett, what they talked about was the importance of having a common understanding of the problem that we face, and the importance of working together in a bipartisan way to solve this problem. And they talked about the real opportunity we have this year to get it done. And I would disagree with the way you stated your question, because there are a number of Democrats who are committed to solving this problem because they recognize that the longer we wait, the worse it gets, and the more of a burden it places on our children and grandchildren, as I pointed out from one of those Democrat's comments earlier in the briefing. And we're reaching out to all members who recognize the problem that exists and asking them to work with us to solve it.

Q What kind of reaction did he get --

MR. McCLELLAN: Go ahead, Bob.

Q -- did he get this morning as far as the possibility of switching to price indexing?

MR. McCLELLAN: That wasn't discussed.

Go ahead.

Q Scott, what's the message to that Democrat on Capitol Hill who agrees with you that there's a problem, but who now questions how genuine the bipartisanship is when he reads a senior policy memo saying that the Democratic Party is the party of the past on this?

MR. McCLELLAN: I'm speaking for the President of the United States, and I just told you what his views are. It's what he has stated publicly. He wants to work together in a bipartisan way to solve this very real problem. He is looking at all ideas that are consistent with the principles that he outlined for strengthening Social Security. And we're listening to ideas from members of Congress. That's what the President's message is.

Go ahead.

Q Scott, you have said that Social Security is in a crisis, it's in a crisis situation, it faces a crisis, faces long-term crisis. Which is it?

MR. McCLELLAN: A number of people have said that on both sides of the aisle. A number of leaders and statesmen have said that.

Q Well, is it an immediate problem, or are you facing a crisis in the future, because if you're facing it in the future but it isn't one now, then is it accurate to say that we're in a crisis?

MR. McCLELLAN: Based on what I just -- what I laid out earlier, I would say, it is a crisis, as the President said at the -- at his end of year news conference last year. When you talk about the facts, I think that says clearly, it is in a crisis. Look at the demographic facts: more people are living longer, more people are retiring, there are less workers to support those retirees, more retirees taking money out, and there are not enough workers to support those retirees. We have an unfunded obligation under current law of more than $10 trillion. The President made it very clear that he's committed to address not only short-term deficits, but long-term deficits, and that means the unfunded liabilities that we face.

And if you go back and look at the Social Security Commission Report, it talked about how, beginning in 2018 -- that is not very far off -- the government will begin to pay out more in Social Security benefits than it collects in payroll taxes, and then shortfalls will continue to grow larger with each passing year until 2042, when the system is projected to become insolvent. That's why we need to act now.

Q Peter Wehner has been speaking for the administration when he basically said that you cannot solve this problem with retirement savings accounts alone and that you have to eliminate wage indexing or you will suffer economic --

MR. McCLELLAN: What we've said is the personal retirement accounts are part of a comprehensive solution for strengthening Social Security for younger workers. As you are well aware, there are a number of proposals that are out there from the bipartisan Social Security Commission to members of Congress. They all have a number of different ideas for how we go about strengthening the Social Security and fixing this unfunded liability. And we're open to talking about all those ideas that are consistent with the President's principles. And we're looking at a number of ideas.

Q But are investment accounts --

MR. McCLELLAN: I'm going to keep moving because we need to go -- well, the President has got a meeting coming up here that I need to get to, as well.

Q Are investment accounts and the wage indexing mutually exclusive?

MR. McCLELLAN: I'm sorry?

Q Can you do one without the other and not adversely affect the economy?

MR. McCLELLAN: There are a number of idea for funding and fixing this unfunded liability.

Go ahead.

Q Scott, after the President's inauguration, if North Korea eventually does not come to the six-party talks, is the United States government prepared to bring the matter to the U.N. Security Council?

MR. McCLELLAN: Well, right now we're focused on working through the multinational effort in the six-party talks. The President wants to see a peaceful, diplomatic resolution to the situation in North Korea. North Korea needs to stop its pursuit of nuclear weapons and then it can realize -- or then it can become a part of -- or realize better relations with the rest of the international community. The President's views are very clear on this. We're continuing to work with all nations in the region who are sending one, unified message to North Korea: We want a non-nuclear Peninsula, and you need to abandon your ambitions for nuclear weapons. That's the message that's being sent to North Korea. It's in North Korea's interest to come back to the six-party talks as soon as possible. The President outlined a proposal -- or we put forward a proposal at the last round of talks for moving forward. It offered some practical steps for resolving this important problem.

Q Could I ask you a question about Canadian drugs?

MR. McCLELLAN: Yes, go ahead.

Q There's an allegation from some Canadian groups that the President and Mr. Martin talked about prescription drugs and that as a result of those discussions, the Canadians are now restricting or curtailing the re-importation of drugs, or the re-exportation of drugs to the United States.

MR. McCLELLAN: Any such assertion is just nonsense. They did talk about the importation of drugs. And I think the President's views are very clear and very well-known when it comes to drug importation. The President's top priority is the safety of the American people. He's also committed to reducing the high cost of prescription drugs. That's why we've acted on a number of fronts to do so. We worked to pass a prescription drug benefit for our seniors under the Medicare program. We have worked to speed the approval of generic drugs, and we have also urged Congress to move forward on medical liability reform. So those are practical ways we can act now to reduce drug costs. And the President remains committed to that.

We also had a HHS task force, just came back with a report looking at the issue of the importation of drugs, and they reported on some findings and we're willing to move forward with members of Congress on the findings of that task force. But the President's views are very well-known when it comes to the importation of drugs. We want to make sure that those drugs meet the same high safety standards as drugs approved in America have to meet.

Q Did he press the Canadians to change the way they deal with sending drugs to the United States?

MR. McCLELLAN: Absolutely not. Any such assertion is nonsense.

Q Scott?

MR. McCLELLAN: Go ahead, Helen.

Q On the question of malpractice, does the President think there is any price tag you can put on the loss of a limb, through bad surgery, your eyes, or anything else? Is there any money -- why is it that he has never, never accused the HMOs and the insurance companies of jacking up the price?

MR. McCLELLAN: People who have been harmed should have their day in court. That's what the President believes and that's one of the first --

Q He believes they can arrive at any price?

MR. McCLELLAN: That's one of the first priorities of his plan to reform our medical liability laws. There is a very real problem in this country when it comes to our medical liability laws. As you heard the President talk about yesterday, there are doctors being forced to shut down their practice, there are being doctors forced to leave one state to go to another state before they -- because they can't afford to keep their practice open. And what you're seeing is that pregnant mothers, like the one the President met with yesterday, are having to switch doctors constantly. She went through -- she's on her third doctor now, a pregnant mother who is soon going to deliver another baby.

Q Well, why do you put a cap on any kind of settlement?

MR. McCLELLAN: The President believes that there ought to be reasonable caps on non-economic damages and punitive damages, but the people who are truly harmed and wronged ought to have their day in court and ought to have fair compensation for that.

Q Any amount?

MR. McCLELLAN: Go ahead, Sarah.

Q Thank you. Florida legislators are introducing a bill designed to prevent the Navy from laying up the aircraft carrier John F. Kennedy, which is home port in Florida. As Commander-in-Chief, how does the President feel about the Pentagon's plan to retire and would the President keep the carrier active as a favor to his brother, Jeb?

MR. McCLELLAN: I'm not sure the latest status on that. I think that's a question probably best directed to the Department of Defense, but I'll look into it.

Go ahead, Geoff.

Q Thank you. While the Democrats are challenging the Ohio results on Capitol Hill, Democrats in Washington state have disqualified any number of military votes in order to win that gubernatorial election there. Considering that American soldiers are in Iraq fighting to give those people there the right to vote, the right to free and fair elections, don't you think we owe it to them to make sure their votes are counted back home?

MR. McCLELLAN: Every eligible vote ought to be counted. We've made that very clear in the past.

Q This -- nobody is taking up for these men and women --

MR. McCLELLAN: And certainly our men and women in uniform ought to have the opportunity to participate in our democratic system, as well, and have their vote counted, just like everybody else.

Q Will the Commander-in-Chief speak out so that these votes will be counted?

MR. McCLELLAN: I think our views are very well-known, and that's an issue that continues with -- between the Republican Party and Democratic Party in the state.

Q Thank you.

MR. McCLELLAN: Thank you.

END 1:14 P.M. EST

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