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President Obama Concludes End-of-Year Press Conference; ; Obama Says Sony Made Mistake in Cancelling Movie; Will U.S. Retaliate Against North Korea; Obama Issues Veto Threat to Congress; Obama Calls on More Female Reporters; Discussion of the President's Press Conference

Aired December 19, 2014 - 14:30   ET

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

BARACK OBAMA, PRESIDENT OF THE UNITED STATES: That oil currently is being shipped out through rail or trucks, and it would save Canadian oil companies and the Canadian oil industry and enormous amount of money if they could simply pipe it all the way through the United States down to the Gulf.

Once that oil gets to the Gulf, it is then entering into the world market, and it would be sold all around the world.

So there's no -- I won't say no -- there is very little impact, nominal impact, on U.S. gas prices, what the average American consumer cares about, by having this pipeline come through.

And sometimes the way this gets sold is, you know, "Let's get this oil, and it's going to come here," and the implication is, is that that's going to oil -- lower gas prices here in the United States. It's not.

There's a global oil market. It's very good for Canadian oil companies, and it's good for the Canadian oil industry, but it's not going to be a huge benefit to U.S. consumers. It's not even going to be a nominal benefit to U.S. consumers.

Now, the construction of the pipeline itself will create probably a couple thousand jobs. Those are temporary jobs until the construction actually happens.

There's probably some additional jobs that can be created in the refining process down in the Gulf.

Those aren't, you know, completely insignificant if, you know -- it's just like any other project. But when you consider what we could be doing if we were rebuilding our roads and bridges around the country, something that Congress could authorize, we could probably create hundreds of thousands of jobs or a million jobs.

So, if that's the argument, there are a lot of more direct ways to create well-paying American construction jobs.

And then with respect to the costs, all I've said is that I want to make sure that if in fact this project goes forward, that it's not adding to the problem of climate change, which I think is very serious and does impose serious costs on the American people, some of them long term, but significant costs nonetheless. If we got more flooding, more wildfires, more droughts, there are direct economic impacts on that.

And as we're now rebuilding after Sandy, for example, we're having to consider how do we increase preparedness in how we structure, you know, infrastructure and housing and so forth along the Jersey shore. That's an example of the kind of costs that are imposed and you can put a dollar figure on it.

So, in terms of process, you've got a Nebraska judge that's still determining whether or not the new path for this pipeline is -- is appropriate. Once that is resolved, then the State Department will have all the information it needs to make its decision. But I've just tried to give this perspective because I think that there's been this tendency to really hype this thing as some magic formula and -- to what ails the U.S. economy. And it's hard to see on paper where exactly they're getting that information from.

In terms of oil prices and how it impacts the decision, I think that it won't have a significant impact, except perhaps in the minds of folks when gas prices are lower, maybe they're more -- less susceptible to the argument that this is the answer to lowering gas prices. But it was never going to be the answer to lowering gas prices, because the oil that would be piped through the Keystone pipeline would go into the world market, and that's what determines oil prices.

QUESTION: (OFF-MIKE) Congress forcing your hand on this? Is this something where you clearly say you're not going to let Congress force your hand on this, on whether to approve or disapprove for this bill (ph)?

OBAMA: I'll see what they do.

We'll take that up in the new year.

All right?

QUESTION: Any new years resolutions?

OBAMA: I'll ask -- April, go ahead.

QUESTION: Thank you. Thank you, Mr. President.

Last question, I guess.

(LAUGHTER)

Six years ago this month, I asked you what was the state of black America in the Oval Office? And you said it was the best of times and the worst of times. You said it was the best of times at times in the sense that there was -- there never has been more opportunity for African-Americans to receive a good education, and the worst of times for unemployment and the lack of opportunity.

Well, ending 2014, what is the state of black America, as we talk about those issues, as well as racial issues?

OBAMA: Like the rest of America, black America in the aggregate is better off now than it was when I came into office.

The jobs that have been created, the people who've gotten health insurance, the housing equity that's been recovered, the 401 pensions that have been recovered: a lot of those folks are African-Americans. They're better off than they were.

The gap between income and wealth of white and black America persists, and we've got more work to do on that front.

I've been consistent in saying that, you know, this is a legacy of a troubled racial past, Jim Crow and slavery. That's not an excuse for black folks, and I think the overall majority of good black people understand it's not an excuse.

They're working hard. They're out there hustling and trying to get an education, trying to send their kids to college. But, you know, they're starting behind oftentimes in the race. And what's true for all Americans is we should be willing to provide people a hand up, not a hand out, but help folks get that good early childhood education, help them graduate from high school, help them afford college.

If they do, they're gonna be able to succeed, and that's gonna be good for all of us.

And we've seen some progress. The education reforms that we've initiated are showing measurable results. We had the highest high school graduation that we've seen in a very long time. We are seeing record numbers of young people attending college. You know, in many states that have initiated reforms, you're seeing progress in math scores and reading scores for African-American and Latino students, as well as the broader population.

But we've still got more work to go.

Now, obviously, how we're thinking about race relations right now has been colored by Ferguson, the Garner case in New York, a growing awareness in the broader population of what, I think, many communities of color have understood for some time, and that is that there are specific instances, at least, where -- where the -- where law enforcement doesn't feel as if it's being applied in a colorblind fashion.

The task force that I formed is supposed to report back to me in 90 days not with a bunch of abstract musings about race relations but some really concrete, practical things that police departments and law enforcement agencies can begin implementing right now to rebuild trust between communities of color and the police department.

And my intention is to -- as soon as I get those recommendations -- to start implementing. Some of them, we'll be able to do through executive action. Some of them will require congressional action. Some of them will require action on the part of states and local jurisdictions. But I actually think it's been a healthy conversation that we've had. These are not new phenomena. The fact that they're now surfacing, in part because people are able to film what have just been in the past, stories passed on around the kitchen table, allows people to, you know, make their own assessments and evaluations. And you're not going to solve the problem if it's not being talked about.

In the mean time, we've been moving forward on criminal justice reform issues more broadly.

One of the things I didn't talk about in my opening statement is the fact that last year was the first time in 40 years where we had the federal prison population go down and the crime rate go down at the same time, which indicates the degree to which it's possible for us to think smarter about who we're incarcerating, how long we're incarcerating, how are we dealing with nonviolent, how are we dealing with drug offenses, diversion programs, drug courts?

We can do a better job of -- and save money in the process -- by initiating some of these reforms. And I've been really pleased to -- to see that we've had Republicans and Democrats in Congress who are interested in these issues, as well.

The one I will say, and this is going to be the last thing I say...

(LAUGHTER)

... is that I -- one of the great things about this job is you get to know the American people. I mean, you meet folks from every walk of life, and every region in the country, and every race, and every faith. And what I don't think is always captured in our political debates is the vast majority of people are just trying to do the right thing. And -- and -- and people are basically good and have good intentions.

Sometimes our institutions and our systems don't work as well as they should. Sometimes, you know, you've got a police department that has gotten into bad habits over a period of time and hasn't maybe surfaced some hidden biases that -- that we all carry around.

But if you offer practical solutions, I think people wanna fix these problems. It's not a -- this isn't a situation where people feel good seeing somebody choked and -- and -- and die. I think that troubles everybody.

So -- so there's an opportunity of all us to come together and, you know, take a practical approach to these problems. And I -- and I guess that's my general theme for the end of the year, which is we've gone through difficult times.

It is your job, press corps, to report on all the mistakes that are made and all the bad things that happen, and the crises that look like they're popping. And I understand that.

But through persistent effort and faith in the American people, things get better. The economy has gotten better. Our ability to generate clean energy has gotten better. We know more about how to educate our kids. We solve problems.

Ebola is a real crisis. You get a mistake in the first case because it's not something that's been seen before. We fix it. You have some unaccompanied children who spike at a border. And it may not get fixed in the timeframe of the news cycle, but it gets fixed.

And, you know, part of what I hope, as we reflect on the new year, this should generate is some confidence. America knows how to solve problems. And when we work together, we can't be stopped.

And now I'm going to go on vacation. Mele Kalikimaka, everybody.

Mahalo.

Thank you, everybody.

WOLF BLITZER, CNN ANCHOR: The president of the United States at a news conference a year-end news conference. He's off to Hawaii tonight with his family for a little R&R, a little vacation.

We want to welcome our viewers in the United States and around the world. I'm Wolf Blitzer, reporting from Washington.

The big headline, the president of the United States saying Sony Pictures made a mistake in canceling the release of the film "The Interview," a film about North Korea, the North Korean leader, Kim Jong-Un.

I want to play the clip. Here is the sound bite from the president saying Sony Pictures made a mistake.

(BEGIN VIDEO CLIP)

BARACK OBAMA, PRESIDENT OF THE UNITED STATES: Sony is a corporation. It suffered significant damage. There were threats against its employees. I am sympathetic to the concerns that they faced. Having said all that, yes, I think they made a mistake. We cannot have a society in which some dictator some place can start imposing censorship here in the United States, because if somebody is able to intimidate folks out of releasing a movie, imagine what they start doing when they see a documentary that they don't like or news reports that they don't like. Or even worse, imagine if producers and distributors and others start engaging in self-censorship because they don't want to offend the sensibilities of somebody whose sensibilities probably need to be offended.

(END VIDEO CLIP)

BLITZER: The president also saying he wishes Sony Pictures had discussed the issue with them before they decided to pull the release of this film.

He also said North Korea was responsible echoing what the FBI said earlier in the day that North Korea deliberately did this. He promised the U.S. would respond but he refused to say how the U.S. will respond. He said only it would be proportionate and the U.S. will respond, in his words, "When we choose to do so." He's not going to release that information in advance.

Jake Tapper, strong words from the president.

He surprised a lot of us by going as far as he did.

JAKE TAPPER, CNN CHIEF WASHINGTON CORRESPONDENT & CNN ANCHOR, THE LEAD: It certainly surprised me.

(LAUGHTER)

Before the press conference, I thought he would be more cautious and talk about how he knew where Sony was coming from as a business. He did say that but then he gave a very strong and sweeping statement about free speech about not giving in to threats from people like Kim Jong-Un -- although I don't think he mentioned him by name -- especially when it came to a comedy film. And then he started talking about the precedent it set. What happens if they don't like documentaries? What happens if they don't like news? Where does it go from there? It was very strong, pro-free speech statement from the president. And you're right, I'm very surprised.

BLITZER: Evan Perez, you have new information. You're learning right now, you're our justice reporter, about the FBI, how they came up with this decision that it was, in fact, North Korea no doubt about that.

EVAN PEREZ, CNN JUSTICE CORRESPONDENT: There was no doubt, Wolf. I have to tell you one thing real quick. What the president just said echoes what I'm hearing from U.S. law enforcement intelligence officials. They are outraged. They understand Sony did what they did but they are outraged that a dictator won censoring the American movie industry as a result of this hack, Wolf. The FBI pretty quickly thought they knew where this hack was coming from and they said that they -- they say that there was some telltale signs despite that North Korean hackers did a very good job to try to mask where this was coming from. They tried to route the attacks through several countries in Asia and Europe and even Latin America. In the end, what the FBI found was telltale signs and lines of code, encryption algorithms that show where it came from matching an earlier attack from last year that was carried out against South Korean banks and media companies and so this is one way they were able to very quickly -- this is unprecedented for them to make a determination so quickly and go public with this.

BLITZER: The president also said that there is no indication any other countries were working together with North Korea. He said he has seen nothing along those lines. This was a North Korean operation.

Gloria Borger, you know, the president almost seemed liberated, if you will, to go out and speak openly about so many issues.

GLORIA BORGER, CNN CHIEF POLITICAL ANALYST: He didn't want to engage. He said when we respond it will be proportional at a time and place of our choosing. I won't raise their profile anymore than it already has been raised over a comedy satire. I can't remember the last time I saw the president so cheerful other than when we won re-election actually. He went out of his way to say I'm energized and excited and this is the fourth quarter and great things will happen in the fourth quarter. A lot of interesting stuff happens in the fourth quarter, which it often does. He was clearly sending a message to the American people, as we've been talking about before he had his press conference. They may call me a lame-duck, but I'm going to keep quacking here. This is not over by any stretch. I think he is buoyed by what happened over the last six weeks -- Wolf?

BLITZER: The question now is, what will the United States do to retaliate, if you will, against North Korea?

JIM SCIUTTO, CNN NATIONAL SECURITY CORRESPONDENT: No question the president is setting out an unyielding position. We'll decide how to respond and it will be on our own time and had a dismissive comment for the North Korean leader. He said it tells you about the regime if they are upset over this movie by Seth Rogen.

(CROSSTALK)

SCIUTTO: that he likes Seth Rogen.

(CROSSTALK)

SCIUTTO: Loves him. And James Franco.

But he also had a message to the American people saying we as a country have to respond to this dismiss it, go on, go to the movie theaters, et cetera. Despite that, North Korea, because of this hack, rocketed to the top of the national discussion, even in a year, 2014, when we have all of these other grave international challenges. He only had brief mentions of Ukraine and Russia, Ebola, the fight against ISIS. We've got two ground wars in Asia still going on. Afghanistan and Iraq, big commitments of U.S. troops there. Not a single question about those issues. And consider all of the stories and discussion we were doing on that earlier this year.

BLITZER: He only took seven or eight questions.

(CROSSTALK)

TAPPER: That's right. All from print reporters.

BLITZER: Really typical style, he gave lengthy answers.

TAPPER: He tends to do that.

Something else that's interesting that I suspect a lot of Republicans in Congress are paying attention to is the fact that he basically issued veto threats. He said if Republicans in Congress bring me bills that weaken Wall Street reform legislation, he'll veto it. He also -- while not saying he was going to veto the Keystone Pipeline legislation that Republicans in the Senate said would be the first order of business, he made the case for vetoing it saying it will have only a nominal effect on U.S. gas prices. This will benefit Canadian oil companies but not really have an effect on the United States. He didn't say, "I'll veto it," but he laid out the case for doing so. (CROSSTALK)

BLITZER: Let me bring in Jay Carney, our CNN political commentator, former White House press secretary for President Obama.

Jay, did you get the same sense that he's laying out the case to veto that Keystone Pipeline legislation, because the Republicans clearly want to put it on the table very, very quickly in the new session.

JAY CARNEY, CNN POLITICAL COMMENTATOR & FORMER WHITE HOUSE PRESS SECRETARY: Wolf, I know he's ambivalent about it. I know he believes, in many ways, both sides of this argument have turned it into a much bigger issue than it factually is. Keystone, if it's built, will not create the number of jobs that proponents claim it will. Nor will rejecting it save the global environment the way some environmentalists claim it will, because tar sands will be exploited regardless if the pipeline is built. I think he's been of two minds of this and it's hard to predict where he will go.

It's true that some of the Senators, Democratic Senators, who would have been most vulnerable if he vetoed it will no longer be in the Senate so that may give him more political leverage.

I tell you, I think Gloria said earlier, talking about how upbeat he was and buoyant he was. I was there as press secretary for three end- of-the-year press conferences and this one was quite different. What was going on at the end of the year? No fiscal crisis. No international crisis. At least not yet, knock on wood. He does clearly feel in the wake of the midterm election that he's been able to demonstrate that he's relevant and that he can execute and get things done and he feels good about it.

BLITZER: Let's get some reaction from a different perspective. Cliff May is joining us, the president of the Foundation for Defense of Democracy.

On North Korea specifically, Cliff, what did you think of what he said?

CLIFF MAY, PRESIDENT, FOUNDATION FOR DEFENSE OF DEMOCRACY: I was glad that he said that a dictator shouldn't be imposing censorship on the United States or on the free world. I don't think it's Sony's battle to fight primarily. I think it's our battle. He said that there will be a response. Less so he assured North Korea that it would be proportionate and that it would not be beyond that because there needs to be some deterrent. Cyber warfare is a dangerous thing. In this case, it was used to shut down a movie and there were terrorist threats. And cyber warfare could shut down our entire society. We're not where we should be on cyber warfare and there has to be a very strong response to such an attempt. This was on a company in the U.S. but it's really an attack on American freedom. In the past, we in the U.S. and in the West have not responded effectively to attempts to shutdown free expression. Imagine if there had been nuclear weapons. His successor may have nuclear weapons and that was a subject not at all discussed and I think it's the most important national security threat we face today. BLITZER: Let me get Bobby Ghosh into this conversation.

Another big issue that came up, Cuba. The president pleased with what's going on in this improved U.S./Cuban relationship, although he played down this notion that he was about to fly off to Havana any time soon.

BOBBY GHOSH, CNN GLOBAL SECURITY ANALYST: He seemed to suggest it was much more likely he would return to being a private citizen than during his presidency, which is probably wise. It would be pretty bad optics for the president to go to Cuba or have Raul Castro over to the White House. Raul Castro is not welcome to the grand halls of the world and major war leaders don't go to Havana because everyone recognizes he is, as the president said, a dictator, a repressive regime. Makes sense to get rid of an embargo that doesn't work.

It was very interesting. The president started by invoking the Cuban people rather than the Cuban government. I think that was the key point. It's not the regime. It's people-to-people relations. He's hoping that just by allowing that to happen, the U.S. will have greater leverage, greater say in Cuba's activities in the future. That's a bank shot. It's better than no shot.

BLITZER: That's a good point. If he goes to Cuba, he would like to engage with the Cuban people.

Doug Brinkley, you're a presidential historian. How did he do in this end of year news conference?

DOUGLAS BRINKLEY, PRESIDENTIAL HISTORIAN: Who would have thought, on midterm election day, he would sell this was a great year 2014 in America and it was a great year for him and it's all about the economy. You can almost feel how optimistic the president is in. He feels the country is moving in the right direction. Dwight Eisenhower, with the great Missile Gap Crisis in 1957, ended up creating NASA. I think this situation with North Korea -- although Newt Gingrich calls it a war, it may be a cyber battle with North Korea -- he may need to create cyber security agency or something. I think he would get bipartisan support. Not that people want to see more government on the right, but we have to address this.

I think the North Korea thing is important and significant and that we'll have to watch it.

And secondly, look, I'm writing on FDR. I'm writing about public works projects, TVA, dams. This is a president that is not green lighting Keystone. I don't know how other ways you could tell him. You don't talk down your product and say, OK, I'm going to do it.

BLITZER: Let's get a thought from Dana Bash, our chief congressional correspondent.

I'm sure members of Congress, Democrats and Republicans, watching very closely. How is what the president said today likely to play with them? DANA BASH, CNN CHIEF CONGRESSIONAL CORRESPONDENT: First of all, he's

somebody who a lot of members of Congress are looking at saying, who is this guy and where has he been for the last six years? He's somebody, as everyone mentioned, in various ways, who feels free to say what he wants and do what he wants.

On what Doug was just talking about, we should note that's the very first legislative battle in January in just a couple weeks. The new Senate majority leader, Mitch McConnell, said he'll do it right out of the gate. If the president is going to use his veto pen and leaning in to do that, it will probably be the first thing that we'll see.

The other thing I just think that's worth noting -- it may seem to our viewers to be naval gazing from reporters -- he not only talk to print reporters, he only asked women for questions. He only called on female reporters. That's very telling for a White House that has gotten a lot of flak, maybe as they should have, for the women inside the White House not rising to the top and not having a seat at the table. The fact that he ended this year only calling on female reporters was no accident.

BLITZER: Let me ask Jay Carney, former White House press secretary, our CNN political commentator now.

Was that just coincidental or deliberate? What do you think?

CARNEY: I'm sure it was deliberate. I'm sure it was discussed beforehand among the president's advisers, including my successor, Josh Earnest. I think it was an excellent decision to make. There are a lot of superb female reporters that cover the White House every day. I think it was a fun way and smart way to end the year by calling on only female reporters. And as a former print journalist, even though I'm on TV now, I like to see print journalist get their chance to ask the president questions.

I would say, Dana, that plenty of senior women in the White House.

BASH: Yeah.

CARNEY: At one point when I was there, the national security adviser, Homeland Security adviser and White House counsel were powerful positions --

BASH: They are now. Absolutely.

CARNEY: -- are women, and that it certainly to the president's credit and to Dennis McDonough's credit.