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White House Press Secretary Holds Daily Briefing

Aired December 10, 2002 - 14:13 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.

KYRA PHILLIPS, CNN ANCHOR: We want to take you live now to the White House, White House press secretary Ari Fleischer just beginning his daily briefing. Let's listen in.
(JOINED IN PROGRESS)

ARI FLEISCHER, WHITE HOUSE PRESS SECRETARY: ... certain that Saddam Hussein conforms to his international obligations. We have a variety of mutual interests with Turkey as we work closely on how to address this threat.

As you know my longstanding policy is not to get into any operational specifics. They did discuss ways that we could cooperate, and I leave it at that.

QUESTION: On the SEC, what does Mr. Donaldson have, in the president's view, that Harvey Pitt didn't have?

FLEISCHER: Well, the president -- and I'm not going to do this as a comparison because the president doesn't make appointments on the basis of comparison, the president makes appointments on the basis of the qualities of the people that he appoints at this moment. And the president, as he said, believes that Mr. Donaldson's long experience, his record in dealing, both in the private sector and in academia, makes him very qualified to be chairman of the Securities and Exchange Commission.

He's widely respected by people in both parties. He's a man of outstanding integrity. And the president was very pleased to appoint him.

QUESTION: You would concede that you've got an agency in trouble here. I mean, the SEC is not clipping along the way I'm sure the president would like it to. It's a much...

FLEISCHER: Well, actually, I think the Securities and Exchange Commission is performing very ably on behalf of the American people. When you take a look at the substantive actions that they have taken, in terms of the record enforcement decisions they have made, the amount of disgorging or taking money back from corporate executives who were defrauding their investors, it's very positive and very encouraging. It's the signs of an agency that is doing the people's business.

QUESTION: I mean, but then why have -- you had two high-profile resignations. You really think the American people buy the idea that the SEC is humming along the way it's intended to? FLEISCHER: I think when people look at the track record of the Securities and Exchange Commission they do see those results.

QUESTION: (OFF-MIKE)

FLEISCHER: I think a change has been made at the helm. This new leader, the president believes, is going to be able to carry out the mission of the Securities and Exchange Commission with ability and with confidence.

QUESTION: Right. The president said that. But what I'm asking you, though, is what's the biggest challenge that Mr. Donaldson, if confirmed, faces?

FLEISCHER: I think the biggest challenge is exactly as the president outlined, which is to restore investor confidence. And I think that investor confidence, when they see just what the Security and Exchange Commission is doing, just what the attorney general's office is doing or the Department of Justice is doing in terms of taking action against corporate wrongdoers, it does give investors more confidence.

QUESTION: Just a question about funding. The president announced more funding for the SEC. There's been some criticism in the past -- recent past from Democrats about the White House holding back on what was originally called for in the Sarbanes bill.

QUESTION: Why a decision now to give more money?

FLEISCHER: Because, of course, as the president prepares the budget for next year, the 2004 budget, there'll be a series of decisions that are made as we work with Congress on various priorities and identify what is important, what steps can be taken to give the Securities and Exchange Commission the tools it needs to do its job on the enforcement front, and making certain they have the means available to carry out the investigations that they're charged with. And the president was very pleased today to announce the almost doubling of the SEC's budget.

QUESTION: You said they're cooperative and agreed to cooperate and so forth in terms of the talks with Turkey. Does that mean that Turkey has agreed to allow the U.S. to use Turkey's soil to bomb Iraq?

FLEISCHER: No, I said nothing about any outcome of that nature. It would not be in my position to describe anything.

QUESTION: (OFF-MIKE)

FLEISCHER: And it was.

QUESTION: (OFF-MIKE)

FLEISCHER: That's correct. But I would not say anything more concrete then that. It is not in my place to report for other nations.

QUESTION: (OFF-MIKE) Is this what he means?

FLEISCHER: And I'm not answering the question. It was a positive meeting, and I don't want you to read into that. But the fact of the matter is...

QUESTION: (OFF-MIKE) positive, and agreed to cooperate. But we know...

(CROSSTALK)

FLEISCHER: Because I'm not giving you the specificity of what cooperation means in that context.

QUESTION: Wasn't he invited here to twist his arm?

FLEISCHER: I know you have seen diplomatic relations for many years, but often countries look at issues and want to work together because they have mutual agreement about policy.

And do not presume that I am indicating what Turkey may or may not do. That is for Turkey as sovereign government to decide. And I give you no inclination one way or another about any future decisions that Turkey may or may not make.

But certainly we -- the president makes very clear in his meetings the threat that he believes the world faces from Saddam Hussein.

And the president also believes very strongly that the stronger the world is, the greater the chance of averting war, because Saddam Hussein will, indeed, react to that strength and pressure and to disarm.

QUESTION: What is this threat from Iraq? In 11 years they have done nothing. What is this threat?

FLEISCHER: Well, except for develop weapons of mass destruction, hide them from inspectors and fool the world.

QUESTION: (OFF-MIKE)

FLEISCHER: Well, not every country has invaded their neighbors the way Iraq has.

QUESTION: Ari, I wanted to ask you about the new proposed regulations (inaudible). Critics are saying that this could open up the floodgates for a lot more companies to convert to plans that they say are unfair to older workers. What does the White House say about that?

FLEISCHER: Well, these are rules or proposed regulations that came out of the Treasury Department today, and they would apply to cash balance plans, the same rule that would apply in the same way that rules apply to defined contribution plans. What that means, consequently, is that a cash balance plan would generally satisfy the age discrimination rules if the pay credits to an employee's account are not less than the pay credits that would be made available if the employee was younger.

QUESTION: But again, there are criticisms that you're going to open up the floodgates for a lot more companies to convert to these plans, which people say -- some people say are unfair to older workers (OFF-MIKE) What's your position on...

FLEISCHER: Well, I think the reason that that's not valid is because the proposed regulations also address conversions of traditional pension plans to cash balance plans. Under these rules, the plan must be age neutral; before the conversion age neutral, after the conversion age neutral and the process of a conversion.

QUESTION: Now that you've taken on the role of an actuary (OFF- MIKE) basically what was the goal here of the White House in releasing these proposed new regulations? FLEISCHER: I think that the rules, as they always are when it comes to matters of pensions, are complicated rules, and that's a description of the rules as they read.

QUESTION: (OFF-MIKE) what was your goal in releasing the new regulations?

FLEISCHER: Again, these are the rules the Treasury Department has announced today, and it's to make certain that people can have pensions and that the pension rights of individuals are protected.

QUESTION: Last Friday, Ari, I asked you about Senator Lott's comment saying he was proud of Mississippi for supporting Strom Thurmond's 1948 racial segregationist, white supremacist presidential campaign. You ducked that question. Can you tell us now whether the president agrees with Vice President Gore that that was a racist statement?

FLEISCHER: In fairness, I did not duck the question. I informed you directly that I had not heard the statement.

And as always, I want to make certain and clear what the statement is before I comment on something that I haven't heard of.

QUESTION: (OFF-MIKE)

FLEISCHER: And I think that from the president's point of view, Senator Lott has addressed this issue. He has apologized for his statement. And the president understands that that is the final word from Senator Lott in terms of the fact that he said something and has apologized for it.

QUESTION: But Senator Lott's final word was that the policies that Strom Thurmond supported have been discarded, that they're discarded policies. He didn't say they were immoral. He didn't say they were wrong. He simply said they were discarded.

Does the president believe that Senator Lott, given this most recent action and given the fact that he published a regular column in a newsletter for years of the Conservative Citizens Council, an openly white supremacist group, is the best person to lead the Republican Party in the United States Senate? FLEISCHER: I can only say that the president -- as several Democrats up on Capitol Hill have all said, Senator Lott has apologized. And I think that speaks for itself on this matter.

QUESTION: So the president thinks that this matter should be...

FLEISCHER: I just think that from the president's point of view all Americans should take great pride in the fact that we are a changed society, and that since 1948 tremendous strides and changes and improvements have been made in the way we treat fellow Americans in the terms of race and equality.

And the president looks at the history of our nation as one that we were a nation that needed to change. The changes that were brought by the civil rights community were healthy and constructive changes that have made us a stronger and a richer and a better society. And I speak for the president.

QUESTION: And he's confident that Senator Lott, given this comment and given his history, embraces those changes sufficiently to be the Republican leader of the United States Senate?

FLEISCHER: The president has confidence in him as a Republican leader unquestionably.

QUESTION: Back on Turkey, does the president think the EU is treating Turkey fairly on these accession talks?

FLEISCHER: Well, this is a matter for the...

(CROSSTALK)

QUESTION: ... on behalf of Turkey.

FLEISCHER: This is a matter for the EU, in final form, to make its judgments.

The president does believe that the European Union should give strong consideration to Turkey's accession into the EU. He thinks it's very important that the EU give consideration to a nation like Turkey, an Islamic democracy, an emerging country that certainly has made tremendous strides in terms of integration into Europe, and to an approach that is compatible with the transparency and the openness of Europe.

So this is something that the president feels strongly about. He's raised it in numerous meetings with European officials directly. And he has talked to Turkish officials about it, as well.

QUESTION: But Mr. Erdogan doesn't feel like he's being treated properly by the EU. Does the president agree with that?

FLEISCHER: Well, I think, again, this is a matter that the European Union will listen to a variety of nations on. The president differs strongly with anybody in Europe who has suggested that because of Turkey's background Turkey would not qualify. The president does not think that that should be a disqualification.

So the president has expressed this in many of the meetings that I've sat in on with European Union leaders.

QUESTION: And what sort of economic package are you putting together for Turkey?

FLEISCHER: Well, as always, the United States has been a longstanding friend of Turkey, and we continue to be a good friend of Turkey. And Congress has worked with many previous White Houses, including this one, on aid for Turkey, and we will continue to work with Turkey and the Congress on the size of an appropriate package.

QUESTION: On Mr. Erdogan's visit, the administration has been very clear in the past few months that it is concerned about Turkey moving into that adjoining section of Iraq should there be regime change in Iraq, and that it's very important for you to keep them out of that Kurdish territory.

At the end of this meeting now, what is the American understanding about Turkey's intentions there and is there an understanding that Turkey would stay within...

FLEISCHER: Yes, the meeting did not get into that level of discussion and that level of detail. What the president believes is that in the event -- and this is in the event -- that any military action is taken in Iraq that it is very important, and the United States is committed to making certain that Iraq is whole; that there is no division within Iraq.

QUESTION: And did the president make that point today again?

FLEISCHER: He did.

QUESTION: What kind of response did he get?

FLEISCHER: It's not my position to characterize a response of other nations.

QUESTION: Could you say whether or not Turkey and the United States are in agreement right now that Iraq under all circumstances needs to remain whole and unified?

FLEISCHER: Again, I think it's not my position to characterize the response of other nations, but I will answer broadly speaking I think that it was a very positive meeting.

QUESTION: I'm not asking you to tell us about their response. I'm asking whether you are convinced now that you and your significant ally here are in agreement on the broad principle of a unified and whole Iraq?

FLEISCHER: The only way to describe whether it was a broad agreement would be two people agreeing, and that would mean I would be commenting on one person's point of view and expressing it for a meeting. And I'm just not at liberty to go into that. I think that's a question you can ask Turkish officials, and I'm sure they'd be more than happy to inform you.

QUESTION: Is the White House worried about the situation in Venezuela, which seems to be deteriorating? Venezuela is probably -- I think is the fifth oil supply in the world, one of the main suppliers of oil to the United States. Is the White House worried about the situation there?

FLEISCHER: The United States is closely monitoring the situation in Venezuela. It's an important area that the United States has a focus on. And we reiterate our complete support for the Organization of American States secretary general, Cesar Gaviria's, efforts to mediate a peaceful, democratic, constitutional and electoral solution to Venezuela's crisis.

We note that there have been many clear statements that have been made for the secretary's mission in Caracas, and been issued in the past week by fellow OAS member states and the chairman of the OAS permanent council. The president calls on all sides, all sides to act responsibly, to act peacefully, to continue to the dialogue process and to reject violence.

QUESTION: (OFF-MIKE)

FLEISCHER: They've talked generally about economic conditions in South America and the need to continue to work with nations to help them as they help themselves. And that was the general tenor of those type of conferences.

QUESTION: Ari, Iraq accused the U.S. of, quote, "unprecedented blackmail," in obtaining the nation's declarations -- the declaration of weapons of mass destruction. And they said, quote, "America aims to manipulate the U.N. documents to find a cover for aggression against Iraq."

FLEISCHER: Well, that is a laughable statement and follows a disturbing pattern, where Iraq looks at the combined actions of the world as spoken and expressed and approved by the United Nations and condemns them. This is Iraq returning to the pattern of dialogue that they've practiced in the 1990s, which is where they met with the -- met the inspectors with -- in the case of inspectors physical obstruction. In this case orally the message to the United Nations is that they reject what the United Nations has done, because the process set up and distribution of the report was a process authorized by the United Nations.

QUESTION: Any thoughts on CSX not paying any taxes in perhaps three of the past four years?

FLEISCHER: The president is very confident that all the information that is relevant on this issue has been looked at thoroughly and fully, and that the Senate will take a look at all of this as well and that his nominee will be confirmed as all of these issues are looked at.

QUESTION: But on that issue itself, on what they have done?

FLEISCHER: I'm not the accountant in this matter. And so, I can give you the perspective of what the president views in terms of his nominee.

QUESTION: So it appears that the White House knew about that and decided it was not an issue.

FLEISCHER: I have not been provided every piece of information that, of course, has been looked at with every nominee. As you can imagine, nominees have a considerable amount of information.

QUESTION: (OFF-MIKE) surprise to you?

FLEISCHER: I think, again, the president knows about his nominee. He's confident in his nominee.

QUESTION: On Iraq, can you tell us where we are in the evaluation process, what the administration is doing to pore over these thousands of pages from Iraq, and how you're approaching this task?

FLEISCHER: The United States government is carefully reading through the declaration that Iraq has sent. It is voluminous. Much of it is in Arabic. And a team of translators, and a team of government officials are looking at the information, making their way through it very carefully. Experts who are versed in the particular areas that have been released are dedicating themselves to the area of their expertise as the report is divided up within the intelligence community.

They are in just the beginning of that process. I anticipate this is a process that is going to take some considerable period of time. And this process will be thoughtful, it will be deliberative, and it will be careful. It will be careful to make certain that we thoroughly and completely understand what it is that Iraq is reporting to declare as well as what they have failed to declare in this rather large document.

QUESTION: So you think it will be several more days before you will have any sort of judgment...

FLEISCHER: Yes.

QUESTION: ... about the extent to which they are being genuine.

FLEISCHER: I think that's a very good possibility. And I hesitate to guess how many several more days. Whenever the proper period of time is that it will take will be the proper time that it takes, because it's important to have a careful and thorough understanding of what Iraq is saying. And that way we can judge it in its entirety.

QUESTION: (OFF-MIKE) not going to release any preliminaries, step-by-step reactions or anything... FLEISCHER: No, I really don't anticipate any step-by-step reactions to it. That's why I said that we want to take a look at this in its entirety and see what it is that has been declared by Iraq as well as to understand what may be not included in this document.

QUESTION: On an entirely unrelated subject, your old home town is faced with a transit strike next week.

FLEISCHER: Pound Ridge (ph).

QUESTION: (OFF-MIKE) Maybe that's a mistake. That's how I take it. Bernie Williams' (ph) home town.

FLEISCHER: Yes. I think he lives in northern Jersey now, but...

QUESTION: The state's rules that a transit strike would be illegal. Would the federal government take any role? Does the president have anything to say about people involved in negotiating?

FLEISCHER: Yes. I have not had any information provided to me on the topic of the potential action up in New York. I've personally noted the reports, but I have not heard anything from the federal government.

If there's anything we have on it, I'll try to share it with you. But I've not looked in that yet.

QUESTION: Another question about the Snow nomination. Apparently during his tenure at CSX, he was loaned something in excess of $24 million by the company in order to make purchases of company stock and then the price of it started to go down instead of up. The loans were forgiven. Does that undermine his credibility as a spokesman for corporate reform?

QUESTION: A practice that, of course, would now be illegal under the Oxley-Sarbanes bill. Does the fact that he has that in his background undermine his...

FLEISCHER: Well, I think loans that were given at this period were perfectly within the law, were, in fact, a common practice among -- in business. And I think that anything that was a common practice that was lawful is not, in the president's judgment, a disqualification, because over time people who are looking at these decisions came to believe, as the president did and as the Congress did, that this practice needs to be stopped into the future. And it has been stopped into the future as a result of the legislation that the president signed.

QUESTION: Is the president aware of this?

FLEISCHER: Yes.

QUESTION: (OFF-MIKE)

FLEISCHER: That's correct. QUESTION: Getting back to Turkey and the EU for a moment, I'm wondering if you could clarify the language a little bit. The president said that the U.S. stand side by side (OFF-MIKE). Does the U.S. explicitly endorse that? Is this the official endorsement? Characterize it for me.

FLEISCHER: Well, given the fact that the decision is a decision to be made by the EU -- that's the reason I said that the president believes the European Union should give strong consideration to Turkey's accession into the European Union. It's a diplomatic way of speaking. This is a decision by the EU, but the president has been very clear about where he stands as a nation that does not belong to the EU.

QUESTION: So tantamount to an endorsement? In other words, if this were within the purview of the U.N., if Turkey were looking for something from the U.N...

FLEISCHER: I said it the way I said it for a reason. That's how the president approaches it. That's the president's belief. It's a matter of protocol, because it is not the United States judgment to make, in the final analysis, but the United States has thoughts and opinions. QUESTION: Ari, the president's going to be speaking in Philadelphia on faith-based on Thursday. Does he anticipate sending up the same legislation that had been worked out in the Senate again or is there some new (OFF-MIKE)

Well, I think you can anticipate, not only on this issue, but on a broad variety of matters, a very aggressive agenda by the president on the domestic front. The president has many issues that he wants to see addressed in the new Congress.

The president was appreciative to the last Congress for the many actions that we and the Congress were able to take together on behalf of the country. But there are many things that have been undone, and the president looks forward to working with the Congress on those areas.

So I think the president will have a lot to say about the domestic agenda on Thursday. He looks forward to going to Philadelphia.

As you heard the president today, as he focused on helping to make sure that we have more volunteers who are able to do good works in our society, the president still has a real, abiding concern about people who may be left behind in America and what we can do together as a community, involving organizations that are faith-based, the business community, as well, of course, as the government sector, to bring help to those in need. So you'll keep hearing from the president on these topics.

QUESTION: Ari, earlier this week, the states and some communities turned in their smallpox recommendation or plans, if you will. How imminent a threat is a smallpox outbreak at this point in the United States? And who would be the potential perpetrator? FLEISCHER: I think the experts, when they assess the threat, they assess the potential damage that could be done by the threat no matter how small it may be because of the very virulent nature of smallpox. And the fact that disease has been eradicated around the globe, could potentially be in the hands of somebody who would want to use it as a terrorist event is an area of concern to any United States government that a president must take a careful look at in order to protect the American people from the potential of a smallpox attack no matter how remote it may be.

And so this is a very important matter for the president. It's a matter that he has approached with care and deliberation. He has, I think, properly and wisely taken time to make his determinations about whether or not to proceed with any type of smallpox inoculation program or vaccine program for the American people.

QUESTION: Do you think he has come to a conclusion?

FLEISCHER: Well, I think when the president does to come a conclusion he'll be in a position to share it.

And this is an issue that he has weighed very carefully, heard from great many sides about. Because the sides involve science and the best guesses about science and how to protect the American people, given the fact that whatever dosage of smallpox vaccine is decided upon there is scientific a basis for side effects in a very small percentage of people who receive the inoculation. Very small, nevertheless that is scientific advice or information that there would, indeed, be side effects for some.

QUESTION: Ari, a short time ago, the House Democrats emerged from the economic summit and said they would soon put forth a short- term stimulus package. Details haven't been worked out, but I can assure you it will not include making permanent last year's tax cuts. Is that a non-starter point for the administration at this moment?

FLEISCHER: Well, one, the president wants to hear the Democrats' ideas. The president welcomes the fact that the Democratic Party as well wants to focus on how to help people get more jobs and how to keep an economy that is growing to grow faster.

So the president begins the year looking for Democrats who want to work with him on common ground, so we can move the country forward.

We'll see specifically what the Democrat ideas are. I think there is division in the Democrat Party about whether or not to raise taxes on the American people. I think these are questions that Democrats are still trying to sort through. I think there are also issues they're trying to finesse in terms of can they talk about them or not.

The president looks forward to working with Democrats next year on these issues.

QUESTION: One is a question on taxes and whether the president is considering looking at the taxes on airlines, particular airline passengers, which take up a significant part of the tickets' price. And airlines are now saying that that would spur the airline industry.

FLEISCHER: I've heard no discussion about anything on that lines.

QUESTION: And secondly, yesterday you talked about that it was not a disqualifying matter in terms of the Augusta country club. Would it make a difference if the Augusta country club disqualified or didn't allow people on racial or ethnic basis? Would that be different for a Cabinet secretary?

FLEISCHER: Do you have something specific in mind here? No, I think that would be a very different category for the president.

QUESTION: Ari, you mentioned the faith-based issue will come up on Thursday. What other areas of the domestic agenda does the president see that were not addressed during the last session? And is he going to be discussing old initiatives or will there be new initiatives?

FLEISCHER: As I indicated, I think you're going to see by the president a very strong focus on the domestic agenda. I think it's going to cover a wide variety of issues that are important to people in their homes and in their lives, including people's health care, including making certain that people have energy that they need and that America can become more energy independent, continued focus on helping people who may be left behind in our society; that gets to the faith-based legislation. I think there are also issues that deal with people's values, such as a ban on cloning, which was an important piece of business that has been left undone that the president would like to return to.

I think Medicare -- when you talk about making certain that Medicare can be strengthened, modernized and that seniors can have prescription drugs.

And certainly welfare reform was an issue that was left unfinished in the last Congress that the president would like to return to.

And finally, the area of pension protections.

I think when you sum up many of these domestic issues, what the president wants to do is, in addition to protecting the homeland and our national security, the president wants to make certain that we have more opportunity and economic opportunity for more Americans.

QUESTION: Is he going to come up with a different drug plan or is he going to stick with what he's proposed thus far?

FLEISCHER: Well, I'm not going to get into specifics about something the president might want to indicate later.

QUESTION: Ari, former President Carter, in his acceptance speech for the Nobel peace award today, used the occasion to call on Iraq to disarm, to comply with U.N. resolutions. But he also suggested that the United States needs to be ready to take "yes" for an answer, and not only as far as Saddam is concerned, but also lifting the sanctions.

Does the president have a response to the former president's remarks, and did he see them or was he briefed on them in any way?

FLEISCHER: I think there is nothing the president would rather do than know that "yes" would be an accurate answer that the world could take. That's what he's waiting for. The president wants to make certain that Saddam Hussein has disarmed. And this is why this is, as the president said, Saddam Hussein's chance to prove to the world that he will this time disarm.

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Aired December 10, 2002 - 14:13 ET
THIS IS A RUSH TRANSCRIPT. THIS COPY MAY NOT BE IN ITS FINAL FORM AND MAY BE UPDATED.
KYRA PHILLIPS, CNN ANCHOR: We want to take you live now to the White House, White House press secretary Ari Fleischer just beginning his daily briefing. Let's listen in.
(JOINED IN PROGRESS)

ARI FLEISCHER, WHITE HOUSE PRESS SECRETARY: ... certain that Saddam Hussein conforms to his international obligations. We have a variety of mutual interests with Turkey as we work closely on how to address this threat.

As you know my longstanding policy is not to get into any operational specifics. They did discuss ways that we could cooperate, and I leave it at that.

QUESTION: On the SEC, what does Mr. Donaldson have, in the president's view, that Harvey Pitt didn't have?

FLEISCHER: Well, the president -- and I'm not going to do this as a comparison because the president doesn't make appointments on the basis of comparison, the president makes appointments on the basis of the qualities of the people that he appoints at this moment. And the president, as he said, believes that Mr. Donaldson's long experience, his record in dealing, both in the private sector and in academia, makes him very qualified to be chairman of the Securities and Exchange Commission.

He's widely respected by people in both parties. He's a man of outstanding integrity. And the president was very pleased to appoint him.

QUESTION: You would concede that you've got an agency in trouble here. I mean, the SEC is not clipping along the way I'm sure the president would like it to. It's a much...

FLEISCHER: Well, actually, I think the Securities and Exchange Commission is performing very ably on behalf of the American people. When you take a look at the substantive actions that they have taken, in terms of the record enforcement decisions they have made, the amount of disgorging or taking money back from corporate executives who were defrauding their investors, it's very positive and very encouraging. It's the signs of an agency that is doing the people's business.

QUESTION: I mean, but then why have -- you had two high-profile resignations. You really think the American people buy the idea that the SEC is humming along the way it's intended to? FLEISCHER: I think when people look at the track record of the Securities and Exchange Commission they do see those results.

QUESTION: (OFF-MIKE)

FLEISCHER: I think a change has been made at the helm. This new leader, the president believes, is going to be able to carry out the mission of the Securities and Exchange Commission with ability and with confidence.

QUESTION: Right. The president said that. But what I'm asking you, though, is what's the biggest challenge that Mr. Donaldson, if confirmed, faces?

FLEISCHER: I think the biggest challenge is exactly as the president outlined, which is to restore investor confidence. And I think that investor confidence, when they see just what the Security and Exchange Commission is doing, just what the attorney general's office is doing or the Department of Justice is doing in terms of taking action against corporate wrongdoers, it does give investors more confidence.

QUESTION: Just a question about funding. The president announced more funding for the SEC. There's been some criticism in the past -- recent past from Democrats about the White House holding back on what was originally called for in the Sarbanes bill.

QUESTION: Why a decision now to give more money?

FLEISCHER: Because, of course, as the president prepares the budget for next year, the 2004 budget, there'll be a series of decisions that are made as we work with Congress on various priorities and identify what is important, what steps can be taken to give the Securities and Exchange Commission the tools it needs to do its job on the enforcement front, and making certain they have the means available to carry out the investigations that they're charged with. And the president was very pleased today to announce the almost doubling of the SEC's budget.

QUESTION: You said they're cooperative and agreed to cooperate and so forth in terms of the talks with Turkey. Does that mean that Turkey has agreed to allow the U.S. to use Turkey's soil to bomb Iraq?

FLEISCHER: No, I said nothing about any outcome of that nature. It would not be in my position to describe anything.

QUESTION: (OFF-MIKE)

FLEISCHER: And it was.

QUESTION: (OFF-MIKE)

FLEISCHER: That's correct. But I would not say anything more concrete then that. It is not in my place to report for other nations.

QUESTION: (OFF-MIKE) Is this what he means?

FLEISCHER: And I'm not answering the question. It was a positive meeting, and I don't want you to read into that. But the fact of the matter is...

QUESTION: (OFF-MIKE) positive, and agreed to cooperate. But we know...

(CROSSTALK)

FLEISCHER: Because I'm not giving you the specificity of what cooperation means in that context.

QUESTION: Wasn't he invited here to twist his arm?

FLEISCHER: I know you have seen diplomatic relations for many years, but often countries look at issues and want to work together because they have mutual agreement about policy.

And do not presume that I am indicating what Turkey may or may not do. That is for Turkey as sovereign government to decide. And I give you no inclination one way or another about any future decisions that Turkey may or may not make.

But certainly we -- the president makes very clear in his meetings the threat that he believes the world faces from Saddam Hussein.

And the president also believes very strongly that the stronger the world is, the greater the chance of averting war, because Saddam Hussein will, indeed, react to that strength and pressure and to disarm.

QUESTION: What is this threat from Iraq? In 11 years they have done nothing. What is this threat?

FLEISCHER: Well, except for develop weapons of mass destruction, hide them from inspectors and fool the world.

QUESTION: (OFF-MIKE)

FLEISCHER: Well, not every country has invaded their neighbors the way Iraq has.

QUESTION: Ari, I wanted to ask you about the new proposed regulations (inaudible). Critics are saying that this could open up the floodgates for a lot more companies to convert to plans that they say are unfair to older workers. What does the White House say about that?

FLEISCHER: Well, these are rules or proposed regulations that came out of the Treasury Department today, and they would apply to cash balance plans, the same rule that would apply in the same way that rules apply to defined contribution plans. What that means, consequently, is that a cash balance plan would generally satisfy the age discrimination rules if the pay credits to an employee's account are not less than the pay credits that would be made available if the employee was younger.

QUESTION: But again, there are criticisms that you're going to open up the floodgates for a lot more companies to convert to these plans, which people say -- some people say are unfair to older workers (OFF-MIKE) What's your position on...

FLEISCHER: Well, I think the reason that that's not valid is because the proposed regulations also address conversions of traditional pension plans to cash balance plans. Under these rules, the plan must be age neutral; before the conversion age neutral, after the conversion age neutral and the process of a conversion.

QUESTION: Now that you've taken on the role of an actuary (OFF- MIKE) basically what was the goal here of the White House in releasing these proposed new regulations? FLEISCHER: I think that the rules, as they always are when it comes to matters of pensions, are complicated rules, and that's a description of the rules as they read.

QUESTION: (OFF-MIKE) what was your goal in releasing the new regulations?

FLEISCHER: Again, these are the rules the Treasury Department has announced today, and it's to make certain that people can have pensions and that the pension rights of individuals are protected.

QUESTION: Last Friday, Ari, I asked you about Senator Lott's comment saying he was proud of Mississippi for supporting Strom Thurmond's 1948 racial segregationist, white supremacist presidential campaign. You ducked that question. Can you tell us now whether the president agrees with Vice President Gore that that was a racist statement?

FLEISCHER: In fairness, I did not duck the question. I informed you directly that I had not heard the statement.

And as always, I want to make certain and clear what the statement is before I comment on something that I haven't heard of.

QUESTION: (OFF-MIKE)

FLEISCHER: And I think that from the president's point of view, Senator Lott has addressed this issue. He has apologized for his statement. And the president understands that that is the final word from Senator Lott in terms of the fact that he said something and has apologized for it.

QUESTION: But Senator Lott's final word was that the policies that Strom Thurmond supported have been discarded, that they're discarded policies. He didn't say they were immoral. He didn't say they were wrong. He simply said they were discarded.

Does the president believe that Senator Lott, given this most recent action and given the fact that he published a regular column in a newsletter for years of the Conservative Citizens Council, an openly white supremacist group, is the best person to lead the Republican Party in the United States Senate? FLEISCHER: I can only say that the president -- as several Democrats up on Capitol Hill have all said, Senator Lott has apologized. And I think that speaks for itself on this matter.

QUESTION: So the president thinks that this matter should be...

FLEISCHER: I just think that from the president's point of view all Americans should take great pride in the fact that we are a changed society, and that since 1948 tremendous strides and changes and improvements have been made in the way we treat fellow Americans in the terms of race and equality.

And the president looks at the history of our nation as one that we were a nation that needed to change. The changes that were brought by the civil rights community were healthy and constructive changes that have made us a stronger and a richer and a better society. And I speak for the president.

QUESTION: And he's confident that Senator Lott, given this comment and given his history, embraces those changes sufficiently to be the Republican leader of the United States Senate?

FLEISCHER: The president has confidence in him as a Republican leader unquestionably.

QUESTION: Back on Turkey, does the president think the EU is treating Turkey fairly on these accession talks?

FLEISCHER: Well, this is a matter for the...

(CROSSTALK)

QUESTION: ... on behalf of Turkey.

FLEISCHER: This is a matter for the EU, in final form, to make its judgments.

The president does believe that the European Union should give strong consideration to Turkey's accession into the EU. He thinks it's very important that the EU give consideration to a nation like Turkey, an Islamic democracy, an emerging country that certainly has made tremendous strides in terms of integration into Europe, and to an approach that is compatible with the transparency and the openness of Europe.

So this is something that the president feels strongly about. He's raised it in numerous meetings with European officials directly. And he has talked to Turkish officials about it, as well.

QUESTION: But Mr. Erdogan doesn't feel like he's being treated properly by the EU. Does the president agree with that?

FLEISCHER: Well, I think, again, this is a matter that the European Union will listen to a variety of nations on. The president differs strongly with anybody in Europe who has suggested that because of Turkey's background Turkey would not qualify. The president does not think that that should be a disqualification.

So the president has expressed this in many of the meetings that I've sat in on with European Union leaders.

QUESTION: And what sort of economic package are you putting together for Turkey?

FLEISCHER: Well, as always, the United States has been a longstanding friend of Turkey, and we continue to be a good friend of Turkey. And Congress has worked with many previous White Houses, including this one, on aid for Turkey, and we will continue to work with Turkey and the Congress on the size of an appropriate package.

QUESTION: On Mr. Erdogan's visit, the administration has been very clear in the past few months that it is concerned about Turkey moving into that adjoining section of Iraq should there be regime change in Iraq, and that it's very important for you to keep them out of that Kurdish territory.

At the end of this meeting now, what is the American understanding about Turkey's intentions there and is there an understanding that Turkey would stay within...

FLEISCHER: Yes, the meeting did not get into that level of discussion and that level of detail. What the president believes is that in the event -- and this is in the event -- that any military action is taken in Iraq that it is very important, and the United States is committed to making certain that Iraq is whole; that there is no division within Iraq.

QUESTION: And did the president make that point today again?

FLEISCHER: He did.

QUESTION: What kind of response did he get?

FLEISCHER: It's not my position to characterize a response of other nations.

QUESTION: Could you say whether or not Turkey and the United States are in agreement right now that Iraq under all circumstances needs to remain whole and unified?

FLEISCHER: Again, I think it's not my position to characterize the response of other nations, but I will answer broadly speaking I think that it was a very positive meeting.

QUESTION: I'm not asking you to tell us about their response. I'm asking whether you are convinced now that you and your significant ally here are in agreement on the broad principle of a unified and whole Iraq?

FLEISCHER: The only way to describe whether it was a broad agreement would be two people agreeing, and that would mean I would be commenting on one person's point of view and expressing it for a meeting. And I'm just not at liberty to go into that. I think that's a question you can ask Turkish officials, and I'm sure they'd be more than happy to inform you.

QUESTION: Is the White House worried about the situation in Venezuela, which seems to be deteriorating? Venezuela is probably -- I think is the fifth oil supply in the world, one of the main suppliers of oil to the United States. Is the White House worried about the situation there?

FLEISCHER: The United States is closely monitoring the situation in Venezuela. It's an important area that the United States has a focus on. And we reiterate our complete support for the Organization of American States secretary general, Cesar Gaviria's, efforts to mediate a peaceful, democratic, constitutional and electoral solution to Venezuela's crisis.

We note that there have been many clear statements that have been made for the secretary's mission in Caracas, and been issued in the past week by fellow OAS member states and the chairman of the OAS permanent council. The president calls on all sides, all sides to act responsibly, to act peacefully, to continue to the dialogue process and to reject violence.

QUESTION: (OFF-MIKE)

FLEISCHER: They've talked generally about economic conditions in South America and the need to continue to work with nations to help them as they help themselves. And that was the general tenor of those type of conferences.

QUESTION: Ari, Iraq accused the U.S. of, quote, "unprecedented blackmail," in obtaining the nation's declarations -- the declaration of weapons of mass destruction. And they said, quote, "America aims to manipulate the U.N. documents to find a cover for aggression against Iraq."

FLEISCHER: Well, that is a laughable statement and follows a disturbing pattern, where Iraq looks at the combined actions of the world as spoken and expressed and approved by the United Nations and condemns them. This is Iraq returning to the pattern of dialogue that they've practiced in the 1990s, which is where they met with the -- met the inspectors with -- in the case of inspectors physical obstruction. In this case orally the message to the United Nations is that they reject what the United Nations has done, because the process set up and distribution of the report was a process authorized by the United Nations.

QUESTION: Any thoughts on CSX not paying any taxes in perhaps three of the past four years?

FLEISCHER: The president is very confident that all the information that is relevant on this issue has been looked at thoroughly and fully, and that the Senate will take a look at all of this as well and that his nominee will be confirmed as all of these issues are looked at.

QUESTION: But on that issue itself, on what they have done?

FLEISCHER: I'm not the accountant in this matter. And so, I can give you the perspective of what the president views in terms of his nominee.

QUESTION: So it appears that the White House knew about that and decided it was not an issue.

FLEISCHER: I have not been provided every piece of information that, of course, has been looked at with every nominee. As you can imagine, nominees have a considerable amount of information.

QUESTION: (OFF-MIKE) surprise to you?

FLEISCHER: I think, again, the president knows about his nominee. He's confident in his nominee.

QUESTION: On Iraq, can you tell us where we are in the evaluation process, what the administration is doing to pore over these thousands of pages from Iraq, and how you're approaching this task?

FLEISCHER: The United States government is carefully reading through the declaration that Iraq has sent. It is voluminous. Much of it is in Arabic. And a team of translators, and a team of government officials are looking at the information, making their way through it very carefully. Experts who are versed in the particular areas that have been released are dedicating themselves to the area of their expertise as the report is divided up within the intelligence community.

They are in just the beginning of that process. I anticipate this is a process that is going to take some considerable period of time. And this process will be thoughtful, it will be deliberative, and it will be careful. It will be careful to make certain that we thoroughly and completely understand what it is that Iraq is reporting to declare as well as what they have failed to declare in this rather large document.

QUESTION: So you think it will be several more days before you will have any sort of judgment...

FLEISCHER: Yes.

QUESTION: ... about the extent to which they are being genuine.

FLEISCHER: I think that's a very good possibility. And I hesitate to guess how many several more days. Whenever the proper period of time is that it will take will be the proper time that it takes, because it's important to have a careful and thorough understanding of what Iraq is saying. And that way we can judge it in its entirety.

QUESTION: (OFF-MIKE) not going to release any preliminaries, step-by-step reactions or anything... FLEISCHER: No, I really don't anticipate any step-by-step reactions to it. That's why I said that we want to take a look at this in its entirety and see what it is that has been declared by Iraq as well as to understand what may be not included in this document.

QUESTION: On an entirely unrelated subject, your old home town is faced with a transit strike next week.

FLEISCHER: Pound Ridge (ph).

QUESTION: (OFF-MIKE) Maybe that's a mistake. That's how I take it. Bernie Williams' (ph) home town.

FLEISCHER: Yes. I think he lives in northern Jersey now, but...

QUESTION: The state's rules that a transit strike would be illegal. Would the federal government take any role? Does the president have anything to say about people involved in negotiating?

FLEISCHER: Yes. I have not had any information provided to me on the topic of the potential action up in New York. I've personally noted the reports, but I have not heard anything from the federal government.

If there's anything we have on it, I'll try to share it with you. But I've not looked in that yet.

QUESTION: Another question about the Snow nomination. Apparently during his tenure at CSX, he was loaned something in excess of $24 million by the company in order to make purchases of company stock and then the price of it started to go down instead of up. The loans were forgiven. Does that undermine his credibility as a spokesman for corporate reform?

QUESTION: A practice that, of course, would now be illegal under the Oxley-Sarbanes bill. Does the fact that he has that in his background undermine his...

FLEISCHER: Well, I think loans that were given at this period were perfectly within the law, were, in fact, a common practice among -- in business. And I think that anything that was a common practice that was lawful is not, in the president's judgment, a disqualification, because over time people who are looking at these decisions came to believe, as the president did and as the Congress did, that this practice needs to be stopped into the future. And it has been stopped into the future as a result of the legislation that the president signed.

QUESTION: Is the president aware of this?

FLEISCHER: Yes.

QUESTION: (OFF-MIKE)

FLEISCHER: That's correct. QUESTION: Getting back to Turkey and the EU for a moment, I'm wondering if you could clarify the language a little bit. The president said that the U.S. stand side by side (OFF-MIKE). Does the U.S. explicitly endorse that? Is this the official endorsement? Characterize it for me.

FLEISCHER: Well, given the fact that the decision is a decision to be made by the EU -- that's the reason I said that the president believes the European Union should give strong consideration to Turkey's accession into the European Union. It's a diplomatic way of speaking. This is a decision by the EU, but the president has been very clear about where he stands as a nation that does not belong to the EU.

QUESTION: So tantamount to an endorsement? In other words, if this were within the purview of the U.N., if Turkey were looking for something from the U.N...

FLEISCHER: I said it the way I said it for a reason. That's how the president approaches it. That's the president's belief. It's a matter of protocol, because it is not the United States judgment to make, in the final analysis, but the United States has thoughts and opinions. QUESTION: Ari, the president's going to be speaking in Philadelphia on faith-based on Thursday. Does he anticipate sending up the same legislation that had been worked out in the Senate again or is there some new (OFF-MIKE)

Well, I think you can anticipate, not only on this issue, but on a broad variety of matters, a very aggressive agenda by the president on the domestic front. The president has many issues that he wants to see addressed in the new Congress.

The president was appreciative to the last Congress for the many actions that we and the Congress were able to take together on behalf of the country. But there are many things that have been undone, and the president looks forward to working with the Congress on those areas.

So I think the president will have a lot to say about the domestic agenda on Thursday. He looks forward to going to Philadelphia.

As you heard the president today, as he focused on helping to make sure that we have more volunteers who are able to do good works in our society, the president still has a real, abiding concern about people who may be left behind in America and what we can do together as a community, involving organizations that are faith-based, the business community, as well, of course, as the government sector, to bring help to those in need. So you'll keep hearing from the president on these topics.

QUESTION: Ari, earlier this week, the states and some communities turned in their smallpox recommendation or plans, if you will. How imminent a threat is a smallpox outbreak at this point in the United States? And who would be the potential perpetrator? FLEISCHER: I think the experts, when they assess the threat, they assess the potential damage that could be done by the threat no matter how small it may be because of the very virulent nature of smallpox. And the fact that disease has been eradicated around the globe, could potentially be in the hands of somebody who would want to use it as a terrorist event is an area of concern to any United States government that a president must take a careful look at in order to protect the American people from the potential of a smallpox attack no matter how remote it may be.

And so this is a very important matter for the president. It's a matter that he has approached with care and deliberation. He has, I think, properly and wisely taken time to make his determinations about whether or not to proceed with any type of smallpox inoculation program or vaccine program for the American people.

QUESTION: Do you think he has come to a conclusion?

FLEISCHER: Well, I think when the president does to come a conclusion he'll be in a position to share it.

And this is an issue that he has weighed very carefully, heard from great many sides about. Because the sides involve science and the best guesses about science and how to protect the American people, given the fact that whatever dosage of smallpox vaccine is decided upon there is scientific a basis for side effects in a very small percentage of people who receive the inoculation. Very small, nevertheless that is scientific advice or information that there would, indeed, be side effects for some.

QUESTION: Ari, a short time ago, the House Democrats emerged from the economic summit and said they would soon put forth a short- term stimulus package. Details haven't been worked out, but I can assure you it will not include making permanent last year's tax cuts. Is that a non-starter point for the administration at this moment?

FLEISCHER: Well, one, the president wants to hear the Democrats' ideas. The president welcomes the fact that the Democratic Party as well wants to focus on how to help people get more jobs and how to keep an economy that is growing to grow faster.

So the president begins the year looking for Democrats who want to work with him on common ground, so we can move the country forward.

We'll see specifically what the Democrat ideas are. I think there is division in the Democrat Party about whether or not to raise taxes on the American people. I think these are questions that Democrats are still trying to sort through. I think there are also issues they're trying to finesse in terms of can they talk about them or not.

The president looks forward to working with Democrats next year on these issues.

QUESTION: One is a question on taxes and whether the president is considering looking at the taxes on airlines, particular airline passengers, which take up a significant part of the tickets' price. And airlines are now saying that that would spur the airline industry.

FLEISCHER: I've heard no discussion about anything on that lines.

QUESTION: And secondly, yesterday you talked about that it was not a disqualifying matter in terms of the Augusta country club. Would it make a difference if the Augusta country club disqualified or didn't allow people on racial or ethnic basis? Would that be different for a Cabinet secretary?

FLEISCHER: Do you have something specific in mind here? No, I think that would be a very different category for the president.

QUESTION: Ari, you mentioned the faith-based issue will come up on Thursday. What other areas of the domestic agenda does the president see that were not addressed during the last session? And is he going to be discussing old initiatives or will there be new initiatives?

FLEISCHER: As I indicated, I think you're going to see by the president a very strong focus on the domestic agenda. I think it's going to cover a wide variety of issues that are important to people in their homes and in their lives, including people's health care, including making certain that people have energy that they need and that America can become more energy independent, continued focus on helping people who may be left behind in our society; that gets to the faith-based legislation. I think there are also issues that deal with people's values, such as a ban on cloning, which was an important piece of business that has been left undone that the president would like to return to.

I think Medicare -- when you talk about making certain that Medicare can be strengthened, modernized and that seniors can have prescription drugs.

And certainly welfare reform was an issue that was left unfinished in the last Congress that the president would like to return to.

And finally, the area of pension protections.

I think when you sum up many of these domestic issues, what the president wants to do is, in addition to protecting the homeland and our national security, the president wants to make certain that we have more opportunity and economic opportunity for more Americans.

QUESTION: Is he going to come up with a different drug plan or is he going to stick with what he's proposed thus far?

FLEISCHER: Well, I'm not going to get into specifics about something the president might want to indicate later.

QUESTION: Ari, former President Carter, in his acceptance speech for the Nobel peace award today, used the occasion to call on Iraq to disarm, to comply with U.N. resolutions. But he also suggested that the United States needs to be ready to take "yes" for an answer, and not only as far as Saddam is concerned, but also lifting the sanctions.

Does the president have a response to the former president's remarks, and did he see them or was he briefed on them in any way?

FLEISCHER: I think there is nothing the president would rather do than know that "yes" would be an accurate answer that the world could take. That's what he's waiting for. The president wants to make certain that Saddam Hussein has disarmed. And this is why this is, as the president said, Saddam Hussein's chance to prove to the world that he will this time disarm.

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