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Biden Speaks To Reporters At End Of G7 Summit In Japan; Biden Says Republican Negotiators Have To Move On Debt Ceiling; U.S. Clears Way For Ukraine To Obtain F16 Fighter Jets; Leaders Pledge Additional Support For Ukraine, New Russian Sanctions. Aired 6-7a ET
Aired May 21, 2023 - 06:00 ET
THIS IS A RUSH TRANSCRIPT. THIS COPY MAY NOT BE IN ITS FINAL FORM AND MAY BE UPDATED.
BIDEN: -- for nearly a hundred (INAUDIBLE) nearly 1 million Americans. It is time for Republicans to accept that there is no bipartisan deal to be made solely, solely under partisan terms. They have to move as well. All four congressional leaders agree with me that default is not, let me say it again, default is not an option. And I expect each of these -- I expect each of these leaders, excuse me, to live up to that commitment. America has never defaulted, never defaulted on our debt and it never will. The speaker and I will be talking later on the plane as we head back because it's what, five or six, 7:00 in the morning there, and our teams are going to continue working.
Now, we've had -- we've had a packed few days here in Hiroshima and I think with very productive and important meetings at the G7 summit. We also held the Quad meeting here in Hiroshima rather than Australia and important bilateral discussions with Prime Minister Kishida of Japan, Prime Minister Albanese of Australia and President Zelenskyy of Ukraine as well as the Prime Minister of India. This is my third trip to the Indo-Pacific as president and I look forward to rescheduling my stops in Papua New Guinea and Australia later.
I have spoken with the prime minister of Papua New Guinea. And Secretary Blinken is traveling there to meet with the Pacific Islander partners at that moment. And I'm also going to be hosting, and I've spoken with the prime minister, hosting the leaders of the Pacific Islander Forum in Washington this fall because I didn't know I'll be unable to make it to Papua New Guinea. And Prime Minister Albanese, we're going to have a state visit later this year. And I also want to thank President Kishida for his outstanding, it's not hyperbole, his outstanding leadership in the G7 this year. As well as Mrs. Kishida and the entire Japanese government for the hospitality they have shown to Jill, myself and our whole team.
Being in this city and visiting the memorial on Friday was a powerful reminder of the devastating reality of nuclear war and our shared responsibility to never cease our efforts to build for peace. And together with the leaders of the G7 we have reiterated our commitment to continue to work towards a world free from the threat of nuclear weapons.
Over the past few days have showcased the unity, the unity and purpose among the G7. It's a very different organization than it was five, seven, 10 years ago because we are addressing the challenges that matter most to the world. We are united in our efforts to strengthen global health security. And yesterday I announced that the United States plans to contribute another $250 million to the pandemic fund at the World Bank to make sure the world is better prepared to prevent, detect and respond to future pandemics.
We are united in our commitment to climate action and accelerating the transition to a global clean energy economy by investing in the industries of the future. We are united in our push to build a more resilient and inclusive global economy that can better withstand the kinds of shocks that we have experienced over the last few years, including by building a more secure and more diversified supply chain.
Through the Partnership for Global Infrastructure and Investment, which we launched last year at the G7 summit in Germany, we have addressed the infrastructure needs that are holding back too many low and moderate income countries, particularly in the global south. The United States has already mobilized more than $30 billion in PGII projects around the globe, a significant step toward our collective pledge of the G7 to mobilize $600 billion in investment by 2027.
And we resolved to reform the multilateral development banks to be more flexibility and better able to fight poverty by helping and responding to global challenges. Now, we are also united in our approach to the People's Republic of China. In a joint statement released yesterday, outlines the shared principles we have all agreed at the G7 and beyond dealing with China.
We are not looking to decouple from China. We are looking to de-risk and diversify our relationship with China. That means taking steps to diversify our supply chains and we are not dependent on any one country for necessary product. It means resisting economic coercion together and countering harmful practices that hurt our workers. It means protecting a narrow set of advanced technologies critical for our national security and those elements are all agreed on by the G7.
Finally, joined here in Hiroshima by President Zelenskyy and the G7 reaffirmed our shared and unwavering, let me say it again, our shared and unwavering commitment to stand with the brave people of Ukraine as they defend themselves against Russia's brutal war of aggression and the war crimes being committed.
Together with our partner countries we reiterated a need for a just peace that respects Ukraine's sovereignty and territorial integrity, both core principles of the U.N. charter. Russia started this war and Russia could end it today by withdrawing its troops from Ukraine's internationally recognize borders and ceasing its assault. Until then, excuse me, the ability -- Ukraine's ability to defend itself is essential to being able to end this war permanently and through diplomacy.
You know -- and this morning I once more shared and assured President Zelenskyy together with all G7 members and our allies and partners around the world that we will not waver. Putin will not break our resolve as he thought he could two years ago, almost three years ago. We are going to continue to provide economic, humanitarian and security assistance to Ukraine so it can stand strong as long as it needs it. And today the United States announced our latest tranche of artillery, ammunition and anti-tank weapons and bridging equipment to help Ukraine succeed on the battlefield.
You know, in my private meeting with President Zelenskyy after the G7 meeting, and with his staff, I told, the United States together with our allies and partners are going to begin training Ukrainian pilots in fourth generation fighter aircraft, including F-16s to strengthen Ukraine's air force as part of a long-term commitment to Ukraine's ability to defend itself. We provided last year all that they needed to deal with what they were dealing with at the moment and that's when -- and now we are moving in the direction of putting them in a position to be able to be -- defend themselves in ways beyond what they have had to deal with so far.
The past few days have once more underscored how important America's global leadership is. A presumptuous thing for an American president to say but I think you will find if you ask any of my colleagues it's true. The security and prosperity of the American people are substantially increased by working in concert with our closest allies and partners to build a future of greater economic strength and resilience and a world that is more peaceful and stable.
And on many of these issues that matter to the American people accelerating our clean energy transition, preventing another pandemic, dealing with China, standing up for Ukraine, the meetings I have had with my fellow G7 leaders have left us more united, more resolved and more determined to set up for the greater progress in the months ahead. And this has been an extremely significant and important summit.
With that, I am going to take some questions. Trevor of Reuters.
TREVOR HUNNICUTT, WHITE HOUSE CORRESPONDENT, REUTERS: Thank you, Mr. President. You spoke a moment ago about what you won't do in terms of your negotiations with Republicans, but I am interested in what you have signaled you already might do. In particular, by conceding in these negotiations to some form of a cap or freezing spending, are you concerned that Mr. McCarthy has already forced you into accepting a policy position that could tip this economy into a recession?
BIDEN: No. I don't believe that's the case at all. As a matter of fact, I think that we can reach an agreement as I have told you, and you may be are aware, you have seen it. We have provided for a proposal that would cut a $1 trillion off the baseline spent from the year before by just agreeing to deal with what was initially offered.
And secondly, we're in a situation where the -- let me put it this way. If you all were doing your budget at home and you said, OK, we have to make some cuts, would you only look at the spending? Would you also look at your income, what was coming in the door to determine what you can afford? And so part of what I have been arguing from the beginning is a need to consider the tax structure as well as -- as well as cutting spending. I am willing to cut spending and I propose cuts in spending of over $1 trillion, but I believe we have to also look at the tax revenues.
The idea that the -- my Republican colleagues want to continue the $2 trillion tax cut that had profound negative impacts on the economy from the Trump administration, the fact that they are -- we've provided for the number -- we got a lot of input from serious economists and former administration officials of both parties that we need more people who are qualified to be able to look at the tax returns of the thousand billionaires in America.
Very complicated stuff. It's estimated that if we had the appropriate number of tax personnel that we would save somewhere between -- generate somewhere between $200 billion and $400 billion in tax revenue. And there's a lot of other -- for example, the idea that we are -- in terms of taxes that they refuse to -- for example, we -- I was able to balance the budget and pass everything from the global warming bill -- anyway, I was able to cut by $1.7 billion in the first two years the deficit that we were accumulating.
And because I was able to say, too, that the 55 corporations in America that made $400 billion -- or $40 billion -- $400 billion that they pay zero in tax, zero. And so we said, you've got to pay a minimum of 50 percent taxes. What a horrible thing. You are paying more than 50 percent of taxes. Every one of you out there.
And so, guess what? We not only balanced the budget. We were able to reduce the deficit by $1.7 billion. This is a lot of things that they refuse to look at in terms of tax generation as well as what kind of people we're going to increase taxes for. Like I said, we are now down to -- we went from roughly 740 billionaires to about 1,000 billionaires in America. They are paying an average tax rate of 8 percent.
Raise your hand if you want to pay 8 percent only? I think you'd all be ready to do that. So my point is that there is a lot of things that they refuse to entertain and they just said revenue is off the table. Well, revenue is not off the table. And so that's what I continue -- we continue to have a significant disagreement on on the revenue side.
HUNNICUTT: But you don't think the spending cuts themselves will also (INAUDIBLE)?
BIDEN: I know they won't. I know they won't. As a matter of fact, the fact that we were able to cut government spending by $1.7 trillion, that didn't cause a recession. That caused growth.
Look, we have the lowest unemployment rate in over 50 years. We have created 12 point -- I think it's 7 million new jobs including 800,000 manufacturing jobs. We have moved in the direction where we're rebuilding and reconstructing America through the infrastructure act. Look, here is the other thing. I am sure -- I am not sure. My guess is I'll get a question about, you know, well, wait a minute, you know, the American people aren't satisfied. Well, guess what? As I told you all before, most of this -- what we passed doesn't kick in -- it only kicks in over time. And so the fact is, for example, that if you're in a situation where you were -- I will give you one example that I've used that everybody understands easiest is insulin.
Well, I decided that we were going to be in a position where we were not going to continue to pay the highest drug prices in the world. That's what we do, by the way. Same manufacture of a drug in the United States selling it here in Japan, selling it in Tokyo or selling it in Berlin or selling it around the world, they pay a lot less than we pay at home.
So we said a simple proposition. Let's take a look at how much it cost to make the product. And I am not going to ask you a show of hands like they do at a town meeting, but I usually ask how many people know somebody who has type 1 or type 2 diabetes? And at least half the audience raises their hand. Well, they were paying somewhere between four and $700 a month for their insulin that they badly need to stay healthy and alive.
Well, guess what? It cost $10.00, t-e-n, $10.00 to make. The package, the total amount you could argue maybe as much as $13.00. Well, guess what? Now they can't charge more from -- Medicare can't because Medicare is paying -- taking American tax dollars and paying for the elderlies' health care needs. You can't charge more than $35.00 for that drug. That saves $160 billion. Hear it? A hundred and sixty billion dollars less will be paid out by the American taxpayer to help the elderly people on Medicare with a problem.
Well, a lot of this is just kicking in. We are in a situation where next year for the drug costs, no senior will have to pay -- total cost, total cost of all the drugs from expensive cancer drugs to whatever drugs they are taking, will not have to pay more than $3,500 a year. The following year we have already passed this. This is a law now.
The following year they won't have to pay more than $2,000. That saves another $200 billion that we are paying out. But the other team won't count this. Even as a law, we passed it, they won't count that as reducing the debt.
So, there's a lot of those kinds of disagreements we have. And my guess is that I am going to be talking to the speaker of House on the way back on the plane because it will be morning time at home and I am going to be in that plane about an hour or so. And my guess is he is going to want to deal directly with me and making sure we are all on the same page. But it's probably more than you wanted to know. How about Masaru, NHK?
TAKAGI MASARU, WASHINGTON BUREAU CHIEF, NHK: Good evening, Mr. President. The Chinese military is more active at this time in the Taiwan Strait with expectations this might increase leading up to Taiwan's presidential collection next January. Despite some, you know, diplomatic communication recently between the U.S. and China, the military hotline is not working. And at this circumstance how will you manage the diplomatic, you know, relationship with China? And how will you strengthen the U.S. alliance with Japan and ROK in order to counter China? Thank you.
BIDEN: Well, number one, you're right. We should have an open hotline. At the Bali conference, that's what President Xi and I agreed we are going to do and meet on. And then this silly balloon that was carrying two freight cars worth of spying equipment was flying over the United States and it got shot down and everything changed in terms of talking to one another. I think you're going to see that begin to thaw very shortly.
But in meantime, what's happened is I think it's fair to say, for those of you who have dealt with the -- dealt with the Japanese government and reported from here for a long time, the situation in terms of our relations with Japan have never, ever, ever in American history been stronger. Never. Never. And we started this relationship when I came to see some -- some are you were with me on my first trip here when I came to see president -- President Kishida's predecessor and made the case that what's happening in Europe, the world is getting smaller. What's happening in Europe, an invasion of Ukraine is -- affects everyone, including people here in the pacific basin.
And so we ended up where you have Japan stepping up in a way that is of real consequence in terms of your defense budget, number one. And a beginning of a rapprochement with South Korea. I have spoken at length with President Yoon of South Korea. He came to Washington of late. He has agreed -- we are all of the same agreement that in fact we are not going to -- we are maintaining -- we all agree we are going to maintain the One China policy, which says everybody kind of forgets, I mean, you all know, but the public kind of forgets that it says that neither country, Japan -- I mean China or Taiwan, neither territory can independently declare what they are going to do, period. There has to be a mutually agreed to outcome. And so we are sticking by that.
We are not going to tell China what they can do. We made it clear that we don't expect -- we don't expect Taiwan to independently declare independence either. But in the meantime, we are going to continue to put Taiwan in a position that they can defend themselves. And there is clear understanding among most of our allies that in fact if China were to act unilaterally, there would be a response. There would be a response.
But -- so I don't think there is anything inevitable about the notion that there is going to be this conflict between the United States and the West and/or Japan and Korea and the Quad. And if you take a look at what's happened, we are more secure with all the talk about China's building its military, and it is building its military.
And that's why I have made it clear that I am not going to prepare -- I am not prepared to trade certain items with China. And when I was asked by President Xi, why? I said, because you're using it to build nuclear weapons and other weapons of mass destruction and I'm not going to do it. And we have now got commitment from all of our allies they are not going to either provide that kind of material that allows them to do that. But that's not a hostile act. That's an act that says, we're going to make sure that we do everything we can to maintain the status quo (INAUDIBLE).
And what's going on now is, look, at the meeting we had here today and yesterday, the Quad. I bet you -- maybe some of you thought it, but I doubt many people in this audience or any other audience would have said that two years after being elected I would be able to convince India, Australia, Japan and the United States to form an organization called the Quad to maintain stability in the Indian Ocean and the South China Sea. Well, when asked by the prime minister -- by President Xi why we are doing that, I said, simple. We have an international -- organizations have agreed upon what constitutes open airspace and sea space. And we are not going to allow that to be unilaterally altered, period.
We are not changing any rules. We are just making sure that we unite democracies and the conviction that the pacific basin remains what it was before, open and clear. So, I guess, what I'm saying is -- I don't guess what I'm saying. What I'm trying to say is, I think, we are more united than we have ever been, ever been in the pacific in terms of maintaining stability and maintaining a sense of security.
So I'm not sure that answers your question, but I hope it does. If it doesn't, do you want to follow up on any portion of that question? Well, how about -- if you don't want to follow up how about Annmarie of Bloomberg, TV and radio?
ANNMARIE HORDERN, BLOOMBERG CORRESPONDENT: Thank you, Mr. President. You just said, I am willing to cut spending. Speaker McCarthy says that the U.S. government needs to spend less next year than they did this year. So, will you agree to that?
And on China, your team has been trying to secure meetings with their Chinese counterparts. Would you consider easing some sanctions to improve relations like the sanctions that are currently on China's defense minister? Thank you.
BIDEN: Yes and no. No, I am not going to ease the sanctions. But yes, I think we should -- on the front end of your question is that we -- there is a lot that is going on relative to spending. And we have agreed to cut spending. We've cut spending and we're going to continue to cut spending.
But the question is, what base do you start from? Initially, if you remember when the Republicans introduced their -- when the speaker by -- I guess a four or five-vote majority was able to pass his -- what he calls extending the debt with a limitation on how -- what you had to do to expend it in terms of the budget side. I said, I am not going to negotiate on whether you extend the debt. I will negotiate on the budget.
On the budget side of the equation, it came along and said, initially it's hard to determine where they are, quite frankly, and I don't know you all may know more from questioning than I do. But they came along and said, we are going to move off of the 2023 budget. And that's the baseline we are going to use for the next two years, that budget.
I said, what about what you all just voted on after the budget which was the add-on money that you all agreed to? The House and Senate voted for it. And they said, well, that includes that as well. I said, OK. Well, then we may be able to work on something. So we started calculating what that would mean in terms of -- it came to a 22 percent cut for everything in the budget but the things that have already been passed, the five big initiatives that I have already passed in terms of infrastructure and the Affordable Care Act, et cetera, et cetera.
But in the meantime, what happened is that that seems to be changing. They said, well, we're going to exempt -- remember we said that you are going to cut veterans because 22 percent for everything, that's discretionary. But I said, no, we are not going to cut veterans. OK, that's good. Initially they started off they are going to cut Medicare and Medicaid.
I said, whoa, whoa, whoa, no -- I mean, not Medicaid, Social Security and Medicare. I said, no, no, no, no. The first time I ever had a negotiation on the state of the union message. But they said, no, we're not going to cut that. OK. Well, that's off the radar.
What else is off the radar? And they named some other things. And I said, well, that means if you want to get the number you wanted from freezing the budget at 2023 plus the additions you added, then it means you are going to go from 22 percent, you are going to end up cutting 30 percent or 35 percent discretionary budget.
For example, if you calculate what they are talking about, they are going to lose -- they are going to lose 100,000 teachers and assistants. They are going to lose thousands of police officers across the board. I mean, just calculate what it means if you take all discretionary spending and you make no distinctions other than what the percentage number of the cut is. And some of it makes absolutely no sense at all.
And so, what we've done is we are going to have to sit down -- I'm hoping that Speaker McCarthy is just waiting to negotiate with me when I get home, which has been, I don't know whether that's true or not. We'll find out. But at first we weren't making any progress. Then we made a lot of progress. And then all of a sudden we came back to the proposal that was very cut back from where they had agreed or discussed.
And now I don't know where we -- we gave a counterproposal to the counter again. I know it sounds ridiculous but that's what we did. And I am waiting to hear the response to what we have offered.
We are willing to cut spending as well as raise revenue so people start paying their fair share. Again, this is (INAUDIBLE) going to ask, raise your hand if you think the tax structure is fair, remotely fair? What do you think? Anyway. So that's the context.
BIDEN: No, I know that. That's under negotiation right now. I thought you said will I lift sanctions -- the material I was going to send -- sell the defense department. Meaning, would I sell some -- the answer to that is under discussion.
Jim Tankersley, "The New York Times."
JIM TANKERSLEY, WHITE HOUSE CORRESPONDENT, THE NEW YORK TIMES: Hi. Mr. President, thank you. You speak a lot at these summits about the power of democracies to solve big problems. But I'm curious in these meetings with world leaders how are you explaining the possibility that American democracy could cause a global financial crisis if the debt limit is breached next month? And I am wondering if you are offering them assurances that whether it's by invoking the 14th Amendment or anything else, you will take whatever steps you need to make sure that doesn't happen?
BIDEN: First of all, it would be a very serious circumstance if we didn't pay our debt for the first time in 230 years. That would be a serious problem. So far, there has very little discussion -- and they all know what's going on -- about whether or not we are going to default on our debt, number two.
Number three, I can't guarantee that they wouldn't force a default by doing something outrageous. I can't guarantee that. Number four, I'm looking at the 14th Amendment as to whether or not we have the authority -- I think we have the authority. The question is, could it be done and invoked in time that it could not -- would not be appealed and -- as a consequence passed the date in question and still default on the debt? That's a question that I think is unresolved.
And so the point is, I think, I'm hoping and I believe that when we stood and we sat in the room with all the leaders from Mitch McConnell on and they said, we will not default. Period. We will not default. That's what all -- including Kevin McCarthy said, we will not default. And so, I'm assuming that we mean what we say and we'll figure out a way to not have to default. Elizabeth Palmer, CBS News.
UNIDENTIFIED FEMALE: This is the last question, sir.
ELIZABETH PALMER, CORRESPONDENT, CBS NEWS: Good afternoon, Mr. President. What has President Zelenskyy told you about the big counteroffensive? Maybe you can start by telling us whether it's actually underway or not.
And I also would like to ask you about the F-16s. You green-lit them now. Jake Sullivan said arms and equipment go to Ukraine according to what he called the exigencies of the conflict. So, what exigency now exists that didn't exist that demands these planes?
BIDEN: I will tell you exactly when they are going to move, exactly where they are going to go. He told me -- come on.
God love you. I'm going to -- even if I knew precisely, you think I'm going to tell you what they're going to do in terms of their offensive? Well, I hope you hope I wouldn't do that because that would mean it wouldn't succeed. But the fact is that we did discuss privately with the -- I did discuss with Zelenskyy how -- let me put this way. We and our NATO allies know how many brigades they have trained, know
what the status of those brigades are, and have an expectation as to what their likelihood of succeeding are.
We don't know that for certain. War is uncertain. War is uncertain. Not to state the obvious. So -- and it will proceed. I can't --- even if I can -- I think I do know, but I'm not going to tell you because that would not be a smart thing to do either.
So, having said that, the expectation and hope is that they will be successful in that it will make it clear to Russia that the cost -- for example, Bakhmut. Bakhmut is a discussion about whether or not it's been lost or whatever. And well, the truth of the matter is the Russians have suffered over 100,000 casualties in Bakhmut. It's hard to make up. It's hard to make up.
So, whether or not there is -- there are troops in Bakhmut occupying, there's not many buildings left standing in Bakhmut. It's a pretty devastated city, but they have been able to move in a direction that they've been able to lock down an awful lot of the Russian forces, including the Wagner group.
So, with regard to the F-16s, F-16s would not have helped in that regard at all. It was unnecessary. For example, let's take this Bakhmut for example. It would not have any additional added consequence. But what's happened is, since the provision of everything from the significant missile defense systems, tanks, sophisticated tanks, and all the things that were of consequence in the near term in the Donbass and where the fighting was taking place, they now have all that equipment. There was a little bit still coming, but have all that equipment.
What's going to happen, though, is if they continue to do well, they're going to be in a situation where you're going to have the Russians being able to stand off at a greater distance for maintaining their headquarters and other things, which are out of range of certain -- of the existing capacity they have. And they have to be able to be in a position where now those fighter jets, those F-16s, make a big difference in terms of being able to deal with what is coming down the road.
And God willing, and we don't know this, if they're successful and they end up being an accommodation where there is not a ceasefire, but there is a peace agreement that gets worked out, that they'll have the capacity to have confidence in their ability to resist response by the Russians if they were to change their position.
So, that's the essence of the difference. Was there another part of the question? UNIDENTIFIED FEMALE: (INAUDIBLE)
BIDEN: No, not the percent -- I don't expect the F-16s to take part in the existing -- let's assume that it's not. But let's assume tomorrow the offensive was started, or in a week or two or five or seven or ten. It's not highly unlikely they would take place in that context, but it will take place in the context if they're successful in the near term.
They're going to then continue to have to fight with the Russians who have headquarters beyond where they are now not able to reach by the existing capacity that exists in their arsenal. So, it's a different need, just like the tanks weren't needed in the beginning, but they're needed now. And so, that's the nature of the change.
UNIDENTIFIED MALE: Mr. President, what assurance -- what assurances do you have that providing F-16s will escalate this war?
BIDEN: I have a flat assurance from Zelenskyy that they will not -- they will not use it to go on and move into Russian geographic territory. But wherever Russian troops are within Ukraine and the area, they would be able to do that. Thank you all very, very much. I appreciate it.
UNIDENTIFIED FEMALE: Mr. President, I'm going to call this a colossal (INAUDIBLE)
BIDEN: It is for them.
UNIDENTIFIED MALE: And Mr. President, on the (INAUDIBLE) you said I've done -- I've done my part. Do you think that's there's (INAUDIBLE).
BIDEN: Of course, no one will blame me. I know you won't. You'll be saying Biden did a wonderful job. I know you.
UNIDENTIFIED MALE: Would you be blameless if (INAUDIBLE).
BIDEN: On the merits, based on what I've offered, I would be blameless. On the politics of it, no one will be blameless. And by the way, that's one of the -- that's one of the things that some are contemplating. I actually had -- well, I've got to be careful here. I think there are some MAGA Republicans in the House who know the damage that it would do to the economy. And because I am president, and the president is responsible for everything, Biden would take the blame and that's the one way to make sure Biden is not reelected. Thank you.
UNIDENTIFIED FEMALE: Thank you everybody.
BIDEN: We have not come up with the unilateral action that could succeed in a matter of two weeks or three weeks. That's the issue.
UNIDENTIFIED MALE: So, it's up to lawmakers. BIDEN: So, it's up to lawmakers. But my hope and intention is when we resolve this problem, I find a rationale to take it to the courts to see whether or not the 14th Amendment is in fact something that will be able to stop it. Thank you.
UNIDENTIFIED FEMALE: OK, the press conference has concluded. Thanks, everybody. Thank you everyone.
VICTOR BLACKWELL, CNN ANCHOR: All right, President Biden there at the end of the G7 summit there in Hiroshima making some news talking about the 14th amendment, which dozens of Democrats in the House and Senate have asked him to invoke to avoid default. He's of course talked about China and Ukraine and Russia, their war as well, making a lot of headlines here. We have the full spate of reporters and analysts with us to go through what the President just said.
AMARA WALKER, CNN ANCHOR: Yes. Obviously, we just heard a huge chunk of that news conference talking about the debt ceiling negotiations or lack thereof. It's really at a stalemate still as we just heard. CNN's Sam Kiley is live in Ukraine, Kevin Liptak in Hiroshima. We're also joined by Aaron David Miller, senior fellow with the Carnegie Endowment for International Peace and former State Department Middle East Negotiator. Also, Chicago Sun-Times Washington Bureau Chief Lynn Sweet. And of course, our White House Correspondent Phil Mattingly, who was in the room also asking questions.
Phil, let's start with you. I mean, it seems like the big takeaway is both sides on the debt ceiling are digging and we heard Biden using words like the other side, the Republicans, their side, their proposals are unacceptable, they're extreme. And of course, he's also considering invoking the 14th Amendment. So, what is -- what's the biggest takeaway in terms of where things stand?
PHIL MATTINGLY, CNN WHITE HOUSE CORRESPONDENT: Yes, look, I think the public statements you've seen leading into this moment made very clear things are not in a good place. There is no clear pathway towards any agreement at this point in time. And a lot is going to be riding on the call that President Biden is about to make when he boards Air Force One, that phone call to Speaker Kevin McCarthy.
Now, you make a very good point in terms of the framing that you heard from the President, making clear the White House is willing to talk, but is just not simply willing to take the vast majority, if not almost all of what House Republicans have put on the table up to this point. And essentially making the push here that something's going to have to give on the House Republican side that they haven't seen yet.
Now, it's interesting, you mentioned the 14th Amendment. He was asked about it and made clear that they were still looking into the issue. And at the very end, that's why I followed up. I wanted to make sure whether or not that was actually considered a tangible option in this moment, given the fact that there are 12 days from a potential default. And the President made clear, this is up to lawmakers. There is no
unilateral action, there is no executive action that they think that they can sign off on or move forward on in that short period of time. It's something he's very willing to consider later after this is resolved. But up to now, it's up to lawmakers.
BLACKWELL: Phil, let me say with you on the 14th Amendment, because as I said, there have been letters from the House and Senate, dozens of Democrats have asked the President to invoke the 14th Amendment, which says that the debt of the United States shall not be questioned. Does it sound like to you that the President, the White House, is further away from no absolutely than they were when these talks started? Because at the beginning it was, we're not going in that direction. Today, he talked about rationale and he talked about if he can make a case to the courts.
MATTINGLY: Yes, it's been interesting. There's been kind of an evolution in terms of the position. They've been studying it behind the scenes for several months. It's been something that there's actually been some disagreements and pretty sharp disagreements inside the White House about the legal validity of it, whether or not the argument can actually win the day.
And I think where things are right now, the President making clear that they have not made a final determination. My understanding is, in terms of legal opinions, I don't think they've been circulated up to this point with a final decision on the issue.
But what's important, and the President alluded to here, is whether or not the United States can still issue debt, if there's an immediate legal challenge to the president saying unilaterally, well, according to the 14th Amendment, I can continue to issue debt.
And the point being this, to not bog two down in the weeds, there is a view, and I think the president reflected this, that this would immediately get tied up in courts. And therefore, you would effectively have a default anyway, and if you did not have a default, the markets would react. And there would be chaos inside the markets.
And I think one of the things that's important to remember when you're talking about this issue is this is not just whether or not the U.S. is able to issue new debt. This is how the market perceives this moment in time how they react, and I think both domestically in the economy, but also internationally. What happens next.?
I think the concern is, is that there's just too many variables that they have no answers on in terms of what would happen in the courts.
WALKER: Look, I mean, this issue seems to get more uncertain and obviously much more urgent by the day, right, making sure that the US meets its debt obligations. As you've been there, Phil, what has your sense been in terms of how the G7 leaders are feeling about this? You know, it seems like there's been a little bit of downplaying of, you know, the leaders being more curious about it rather than concerned, even though we know that if the U.S. does default -- it never has before, this would be the first time if it actually happens, but that would cause a global economic catastrophe. Is there much more concern that you sense amongst the G7 leaders that this could possibly happen?
MATTINGLY: Yes, you know what's fascinating is the G7 is comprised of just under 50 percent of the entire world's global -- the entire global economy, right? These are the biggest players certainly amongst developed democracies. And you make a great point, there's kind of a sanguine view -- to some degree, my understanding according to some officials is that leaders would kind of give them a hard time, or their advisors would say, I can't believe you're dealing with this again, type stuff. And I think that reflects the fact that over the course of the last decade, 12, 13 years, this is constantly something that happens, not necessarily just debt ceiling debates, also government shutdowns, just general dysfunction between Capitol Hill and the Executive Branch.
And yet there's always a resolution, right? They always pull a rabbit out of the hat in the last minute, and everybody kind of moves on. And I think what has not necessarily sunk in here, and some it's now over, but over the course of the last several days, is that this time could be different. And I don't think White House officials have tried to reflect that to anybody. I think they've made clear, the president said it, his National Security Advisor has said it several times as well. The president was making clear to leaders that they would find a resolution here, they didn't need to worry, this would be something that would get done.
But it's always something that gets done until the time it doesn't. And I think that's the issue right now, given the clock and given how far away they are from this, that perhaps some of these leaders in the coming days will be a little bit more nervous than they were here on the ground in Hiroshima.
BLACKWELL: Sam Kiley is up next reporting from Ukraine. And we know that President Zelenskyy, he began his news conference as the president was speaking. But what we heard from President Biden on the question of the training of Ukrainian pilots on F-16s, offering up that military aid that he got a flat assurance from President Zelenskyy that those planes would not be used to attack inside Russian territory.
Of course, that has to be reconciled with the reporting from the Washington Post from the Discord leaks that several months ago, President Zelenskyy was considering options or hearing options as well about being more aggressive in Ukraine. The importance of this shift now of the U.S. preparing to hand over those planes sometime down the road and starting to train those pilots.
SAM KILEY, CNN SENIOR INTERNATIONAL CORRESPONDENT: Yes, it's very significant not before time as far as the Ukrainians are concerned. NATO allies and the President sort of said this in as many words, they kind of give the equipment when they deem it necessary for the Ukrainian war effort. But obviously, the Ukrainians would argue if they had F-16s from the get-go, they wouldn't be in this business already. But nonetheless, I think that the apparent dichotomy between
assurances that they won't use U.S. weapons, indeed Storm Shadow, the British cruise missile, and other long-range weapons to attack targets inside Russia itself is a long-standing assurance, one that they have to keep repeating.That doesn't mean they can't use their own weapons, they can't use partisans, they can't use their own special forces, and indeed there is a degree of evidence that they've been doing just that in some attacks inside Russia itself.
But this is much more about being able to ensure that the Ukrainians, even if they are successful in their counter-offensive, which is much touted for some time this summer, the President was saying this is about consolidating effectively any of those successes. It's about being able to defend Ukrainian territory over the longer term.
Now, this is going to be seen by Russia inevitably as an escalation. They've been extremely angry at the suggestion that the United States or others may supply F-16's fourth-generation fighter bombers to the Ukrainian war effort because they are ultimately a strategic weapon, and they would perhaps help to keep in a future dispensation Russian troops out of Ukrainian territory permanently. That's essentially what the U.S. President was saying they were intended for as well as the nearer-term combat operations that they might be used for.
Not, he said, though, in the summer offensive, which could come far too soon for the training or indeed the supply of these aircraft to come through.
WALKER: All right, Sam Kiley, thank you for that.
Let's talk now with Aaron David Miller as well. And Aaron, you know, this obviously was hugely consequential, this G7 summit, especially when it comes to Ukraine and China. What were the biggest takeaways for you, especially when we saw the G7 leaders really showing their resolve when it comes to supporting Ukraine for the long haul? And obviously, it was quite notable to see the leaders speaking with one voice on China.
AARON DAVID MILLER, FORMER MIDDLE EAST NEGOTIATOR, STATE DEPARTMENT: I mean, the President, frankly, got what he needed out of the summit, particularly in Ukraine, and perhaps on China. We don't know the details of what exactly the allies have agreed to with respect to controls or efforts for van exports and semiconductors and other technical materials to build up the Chinese military.
But on the face of it, I thought, again, you had ally G7 unity on Ukraine. Zelenskyy's presence, as it always does, demonstrates the importance of leadership and particularly his leadership at a critically important moment.
But I think I'm balanced, frankly, this is a prelude to the even more important event that just come. Because if in fact, the Ukrainian offensive succeeds in taking back hundreds of square kilometers of Ukrainian territory, or perhaps even more, depending on how competent and capable Ukraine's military can be in this current offensive, it'll provide an inflection point for the direction of this conflict.
If the Ukraine offensive falters or essentially stalls and does not change the trajectory of the conflict in a fundamental way, I think both allies and adversaries are going to have to rethink exactly how we go forward, and in the administration have to have to think that as well.
The other point I would add is will to fight is important, but so is will to fund. And I think with the $375 million commitment, and the addition of the F 16s, which is both symbolic for the moment, but also I think determinative in the longer term, I think that will fund the still quite resilient allies. And even with some Republican opposition, pretty deep here at home as well.
BLACKWELL: Lynn, the President put it quite plainly, "I am willing to cut spending in discussions, of course, we know that he's having with Republicans on the debt ceiling. He says that it's the budget, not the debt ceiling, but that's really a semantic game. The reason we're having this conversation is because he's trying to get the votes to raise the debt ceiling.
Gage for us the degree of confidence that Congressional Democrats have in the President. As I said, there's some saying just go and make the 14th Amendment play. Are Democrats on the Hill confident that the President will not be willing to go too far and maybe some of those work requirements for federal aid as he says that he's willing to cut a trillion dollars?
LYNN SWEET, WASHINGTON BUREAU CHIEF, CHICAGO SUN-TIMES: Well, what we have here is the outlines of the outline. Meaning without saying it, the President talking about the 14th Amendment is actually acknowledging the pressure he is getting within the progressive wing of the Democratic Party. Democrats are not united on the approach right now.
But just as speaker McCarthy has to keep his MAGA Republican wing in line, so does President Biden have to keep the progressives. So, what we actually saw here, if we could take a few steps forward in our chess game of solving this very serious solution is a road where perhaps in the House Kevin McCarthy can lose some MAGA Republicans and President Biden can lose some of progressives. This has happened on some votes, by the way, towards a deal. You know, towards the 219 or 18, depending on who's there that day, that you need to get this.
The other thing that I think is very interesting is that President Biden made it clear that the 14th Amendment, that is the public debt clause, is untested. And as we've been discussing, the litigation alone might negate it as an effective tool. But when President Biden talked about revenue, he also framed it in terms of tax equity. It's not raising taxes on everybody. Yes, you'll get more revenue. It's just the thousand billionaires. It's an equity issue that also could put cash in the pipeline.
WALKER: So, our Kevin Liptak is also available. And Kevin, again, we heard President Biden say, look, I'm willing to cut spending. I think he threw out the amount of $1 trillion in cuts. Of course, some Democrats are concerned what this means, as Victor was saying, when it comes to the federal safety net programs. He did say that he's not willing to sign up for billions of dollars of tax cuts that would benefit the oil industry and the pharmaceutical industry. What is Biden willing to give?
KEVIN LIPTAK, CNN WHITE HOUSE REPORTER: Well, it seems what he's saying is he's willing to cut some levels of spending. And when you talk to White House aides, the proposals that they've put forward include keeping some levels of defense spending, cutting some domestic spending. And I think the problem right now is that the two sides are so far apart.
And I do think it was striking when you listen to the President. His tone is so different from what we just heard 24 hours ago here in Hiroshima when he was, you know, quite optimistic about reaching a deal, essentially saying that what was happening was just posturing and bluster and basically what he expected.
He came out to this press conference in much sharper fashion. It followed a sharpening of rhetoric by his aides as well. And I think that does tell you that the White House does view this as much of a political situation as a quite a real economic situation as well. And it was interesting something that he said at the very, very end of this press conference. He said, on the merits based on what I've offered, I would be blameless. But on the politics of it, no one will be blameless.
And he went on to do something quite extraordinary suggesting that some MAGA Republicans, as he called them, would send the economy into default if it meant damaging him politically. So, clearly, the president seeing a need to sharpen his political spear in these talks.
Of course, he is heading back to Washington. He's probably, you know, on his way to Air Force One now. That phone call with House Speaker Kevin McCarthy will be essential. And the way President Biden framed it was interesting. He said he thought that McCarthy just needed to talk to him directly to ensure that he was still engaged.
He says he wasn't sure if that's what McCarthy wanted or not, but that is something that he was hoping for in these talks. So, it will remain to be seen if that will break the log jam. But certainly, this has really overshadowed his trip to the summit here. It's been a topic of discussion. And it really hasn't done anything to sort of dissuade particularly European leaders that the American political system is just in a state of dysfunction at the moment.
You know, you heard Jake Sullivan, the National Security Advisor, say there was a point of interest in the conversations with the leaders. President Biden said in his talks that he wasn't able to guarantee that the United States wouldn't default.
And so. this is an interesting insight into his conversations with the leaders here at this precarious moment. He is departing here with no necessarily reassurances to those leaders who are also leaving here in Hiroshima, watching anxiously what transpires back in Washington.
BLACKWELL: Yes, Phil Mattingly who was there front row for this news conference, I think, Jim Tankersley from the New York Times asked the most potent question when he said if you are making the case here at the G7 and the president, all of these multilateral organizations says that this is the decade or the century of democracy versus autocracy, your democracy could cause a global financial crisis. How do you reconcile those two?
And at the moment, the president -- I don't know, as Kevin said, we didn't see -- we're not hearing the same optimism. That becomes a more difficult case to make as they look over his shoulder at the fight back in Washington.
MATTINGLY: Yes, Victor, I think you make a great point in kind of a micro aspect of a much broader issue that the president faces. And you can track it back to his first G7 back in 2021 where the entire kind of purpose of his visit in Cornwall in the United Kingdom was to say America is back, right? Consistently, over and over, America is back, diplomacy is back, we're back on the world stage. Things were supposed to start calming down.
The European leaders who have been very unsettled by the former president, who have been very unsure about where American policy was going after decades in a pretty straight direction, now they had somebody who was back. A trans-Atlanticist, somebody who believed in alliances and those that have existed for a long period of time.
And the president has tried throughout the course of the last two plus years, two and a half years, to make the case that he's bringing back some sense of normalcy. He's taking the temperature down. And yet the former president is far and away the leading contender to be the Republican nominee in 2024. Congress now divided after the midterm elections is once again doing what Congress seem to do on a pretty consistent basis over the course of the last decade.
And I think it raises real questions about whether or not the U.S. is moving in a different direction than where it was perhaps from the four years that led to events that looks to foreign leaders like completely polar opposite of what they would ever expect the United States to operate as or whether or not this has become kind of the new norm. And I think there's just all of that feeds into it, guys. And I think there's a broader concern. Despite the fact, this was viewed as a very successful G7 summit.
BLACKWELL: All right, Phil, Aaron, Lynn, Kevin, thank you. Our thanks to Sam Kiley reporting in Ukraine as well. We'll have much more on what we heard from the President throughout the show this morning. CNN THIS MORNING continues right after this.