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Bush Meets with Greenspan

Aired January 07, 2002 - 14:48   ET

THIS IS A RUSH TRANSCRIPT. THIS COPY MAY NOT BE IN ITS FINAL FORM AND MAY BE UPDATED.

THIS IS A RUSH TRANSCRIPT. THIS COPY MAY NOT BE IN ITS FINAL FORM AND MAY BE UPDATED.
LEON HARRIS, CNN ANCHOR: We have got some tape coming in to us right now, tape of a meeting that happened in the White House just moments ago. This is not live, this is tape. President Bush is meeting with Fed chairman Alan Greenspan and some other leaders and he is talking about economic policy.

(JOINED IN PROGRESS)

GEORGE W. BUSH, PRESIDENT OF THE UNITED STATES: ... Chairman Greenspan for coming. He's here to offer his independent advice and counsel about the state of our economy. I want to thank my economic team for keeping me abreast of what we're learning during our Christmas break.

I look forward to a substantive discussion about how to wisely put policy in place that will help this economy recover. We're making good progress on winning the war in Afghanistan, and we've got to make good progress about helping people find work.

The cornerstone of any good policy is going to be to take care of -- to help people help themselves, take care of those who may have lost their job as a result of 9/11, but always remember the most important thing for those who have lost their job is to be able to find work. And so the question I'm going to ask, and the question I hope Congress asks, is how best to create jobs; what can we do to encourage economic growth so that people who want to work can find work?

I'm optimistic that 2002 is going to be a better year than 2001, and we will discuss ways here to make -- to figure out how government can make that happen.

One thing I will do, after the course of these discussions and some discussions later on this week, will put in my budget an economic stimulus package.

And speaking of that, I hope that when Congress comes back they will have listened to their constituents and that Congress will realize that America, like me, is tired of partisan bickering, that we ought to come together, we ought to unify around some sensible policy and not try to play politics with tax relief or, for that matter, economic stimulus packages.

I'll be glad to answer a few questions. QUESTION: Mr. President, can you achieve funding for the military and homeland security without dipping into the Social Security and Medicare accounts?

And, Chairman Greenspan, if I could...

BUSH: Well, wait. I promised him that he could come. He's an independent soul, he can have a press conference elsewhere. But one of the things we're not going to do is drag the chairman into a press conference, otherwise he won't come back to the White House.

QUESTION: (OFF-MIKE)

BUSH: Well, you can find him in his place of business.

Sorry to tell you how you do it. It's a new year.

(LAUGHTER)

QUESTION: (OFF-MIKE)

BUSH: I plan to be much more assertive with the press.

(LAUGHTER)

QUESTION: (OFF-MIKE)

BUSH: Well, OK.

I said to the American people that this nation might have to run deficits in time of war, in times of a national emergency or in times of a recession. And we're still at all three. We had a national emergency, we're trying to win a war and we're in a recession.

So I have no problem figuring out ways to win the war, figure out ways to protect the homeland -- and those will be the priorities of my budget -- and at the same time -- and spending the money necessary to do both -- and at the same time recognizing that we may not balance the budget for this year.

It makes sense to spend money necessary to win the war. It makes sense to spend money necessary to protect the homeland. And we're in a recession.

There is some talk about raising taxes. And that would be a disaster, to raise taxes in the midst of a recession. Even, I think you'll find that to be the -- most economists agree with that point of view, if they're fair about it, they will say that.

And so, as I said out there, somebody must be reading a different kind of economics textbook here in Washington. And most of the people that I spoke to in California and Oregon understood that we shouldn't be raising taxes in a recession.

Yes? QUESTION: Mr. President, given that there was little progress on the stimulus package in December, in the time it would take to phase one in, will your package, that you're proposing, take effect more quickly than the one you proposed in December?

QUESTION: And in addition to that, do you think, in the meantime, further interest rate cuts might be a way to provide the (OFF-MIKE)

BUSH: Well, first in terms of monetary policy, I'll leave that in the hands of our chairman, Chairman Greenspan. He's done a fabulous job in running the Federal Reserve, and for that America should be grateful.

Secondly, we did make very good progress on the economic stimulus package. We had a bill come out of the House of Representatives, and there was a bill that could've passed the United States Senate. There was enough votes, had the bill being brought on the floor that would've passed. It took good features from a Republican point of view; it took good features from the Democratic point of view. We brought it together, and made a very good package. That's pretty darn good progress, except along the ways there was an attitude that said, "Well, maybe we don't need a package." I happen to believe we do need one, and there was a good one that could've passed.

QUESTION: Why does everything have to be so black and white? Is there not room to maybe phase in the tax cut in the out-years more slowly to protect the government's bottom line? And the second thing is, what will you say as elements of a new stimulus package? You think there's a way to break this logjam?

BUSH: Well, first of all, the logjam was broken in December of this year. Republicans and Democrats realized it was time to act. We came together, and something would have passed in the Senate. So in terms of finding a solution that bridged good ideas from both parties, that's happened.

And your first question was?

QUESTION: Why is everything so black and white on the issue of (OFF-MIKE)

BUSH: Because a tax cut is part of the prescription for economic recovery.

BUSH: By reducing taxes at a time when our economy was slowing down, the Congress, working with the administration, did the absolutely right thing to provide a stimulus. And to change in the midst of the phasing in of the tax relief plan would send the absolute wrong signal to the economy. It would say we weren't real about it; we weren't serious about tax relief. Tax relief is a part of the economic recovery plan.

Listen, thank you all very much -- yes, one more -- it's a new spirit. QUESTION: It would appear that war now has been averted between India and Pakistan and has Pakistan done enough to crack down on terrorists?

BUSH: I think it's very important for President Musharraf to make a clear statement to the world that he intends to crack down on terror. And I believe if he does that and he continues to do what he's doing, it'll provide relief, pressure relief, on a situation that's still serious.

I don't believe the situation is defused yet, but I do believe there is a way to do so, and we are working hard to convince both the Indians and the Pakis there's a way to deal with their problems without going to war.

QUESTION: Mr. President, during the holiday you stood by your Secret Service agent, and American Airlines has come out with a new statement today saying that he was bitter and hostile. What are your thoughts about the situation with your Arab American agent now as it pertains to him trying to protect you?

BUSH: Well, I know there's an investigation going on, and I look forward to see the findings. But as I said, if he was mistreated because of his ethnicity, I'm going to be plenty hot. That means angry.

And I know the man, I am most appreciative of his service to me and my wife. He is an honorable fellow. But I don't know enough about the details of this particular incident. But I know there's an investigation going on, and I look forward to seeing it.

I would be surprised if he was hostile. But I wasn't there, so it's hard for me to comment on something which I did not see.

Listen, thank you all for giving me a chance to visit with you.

HARRIS: As we said, this tape just came into us moments ago. This is President Bush just back from his 12-day vacation at his Crawford, Texas ranch. And his first order of business was to meet with Fed Chairman Alan Greenspan and his panel of economic advisers as well. Started talking about jump starting the economy. Let's go to our John king who is standing by in Washington -- John.

JOHN KING, CNN CORRESPONDENT: Leon, part of the president's new strategy is dealing with the economy is to defend the old strategy, if you will. You heard the president repeatedly saying his tax cut last year was the right prescription for an economy in trouble. Some in the Congress, Senate Majority Leader Tom Daschle chief among them have blamed that tax cut.

Daschle says it has made the recession even worse. There some talk, no proposal on the table yet, but some talk among some Democrats that perhaps the Bush tax cut should be slowed down or parts of it repealed. The president saying that would be quote, "disaster for the economy." This meeting with the Federal Reserve chairman Alan Greenspan, the vice president, several members of the cabinet, the top Bush economic team, all part of the president's short term and long-term effort to put his focus not only on managing the war overseas, but on directing an economic recovery here at home.

Mr. Bush, if you listened closely, said that he would include an economic stimulus package in his budget. That means when he submits a new budget to the Congress, a little more than a month from now, he will factor in passage of an economic stimulus package. There would be tax cut in that, tax cuts in that, some government spending. So Mr. Bush saying he will factor that in. That leads you to believe he hopes to reach an agreement with Democrats in the Senate.

If not, this fight will continue on in the months ahead, and this is, as we noted about an hour ago, a congressional election year, raising stakes as they try to reach bipartisan policy, there is quit a bit of partisanship because of the coming congressional election -- Leon.

HARRIS: We will see how that shapes up. John king in Washington will be there to cover all that as well.

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