Press Briefing by Press Secretary Mike McCurry, Chief of Staff Leon Panetta, Secretary of Treasury Bob Rubin, and National Economic Council Chair, Dr. Laura Tyson

The Briefing Room

1:52 P.M. EST

MR. MCCURRY: Good afternoon, ladies and gentlemen. Welcome to the White House. If you could all take your seats for our daily briefing. With the first glimmer of hope that some fiscal sanity might begin to prevail among some of the Republican majority in Congress, I've asked the Chief of Staff, Secretary of the Treasury, and the Chair of the National Economic Council to join us at the daily briefing today for some remarks. And I'll turn it over to Mr. Panetta to begin.

MR. PANETTA: Today we received a release that indicates that 102 House Republicans have asked the Republican leadership to permit them to offer an amendment to the Republican Contract that would target a portion of the Republican tax cut to middle-income taxpayers.

We want to take this time to commend those Republicans who signed the letter and pay particular tribute to Pat Roberts, who was a colleague of mine and I served with on the Agriculture Committee, who is one of those who released the fact that Republicans had joined together, close to half of the Republicans had joined together to sign this letter.

The amendment, as we understand it, would bring the family tax credit portion of their proposal far closer to the President's middle income Bill of Rights than to the Contract proposal. The President feels very strongly, obviously, about targeting any tax cut to working families, and this action we would view as a small but, nevertheless, important step towards the President's position. As our friends from the space program might put it, this represents one big step for the Republicans, but one small step for the middle class.

This amendment, as all of you that have followed the tax debate know, represents, I think, an indication that the Republicans see some of the weaknesses in their tax proposal. The President has identified three areas of concern. First, that their proposals in large measure are not targeted towards working families, but favor the wealthy. And secondly, that they are far too costly. The cost of their proposal is close to $200 billion over five years, almost $630 billion over 10 years, in contrast to the President's proposal which is $63 billion over five years and approximately about $170 billion over 10 years. And thirdly, the Republicans are obviously paying for their tax cuts in order to give tax breaks to the wealthiest citizens in this country with cuts in programs that serve our most vulnerable citizens.

With this amendment, at least some Republicans are clearly moving, albeit slowly, towards the President's position. They acknowledge that at least that portion of it is not -- does not represent the kind of targeting towards working families that we believe are important for any kind of tax cut.

There still remain some huge differences. First of all, the amendment would have relatively little impact on the overall fairness of their tax plan. By that, we mean that it does not touch legislation that impacts primarily on the wealthy and large corporations -- the capital gains tax break is still present; the corporation depreciation tax write-off is still in the proposal; and the repeal of the alternative minimum corporate income tax which prevents large corporations -- which allows large corporations to virtually get away without paying any income taxes -- those provisions are still part of the tax plan and we think they represent the costliest elements of their proposal.

Secondly, the amendment would have relatively little impact on the overall cost of the Republican Contract. Although they estimate at least saving somewhere between $10 billion to $12 billion, we think the overall cost still would be in the vicinity of $600 billion over 10 years.

And lastly, again, the tax cut is paid for at this point by some of the harshest spending cuts that undermine what we believe should be the nation's commitment to education and to the most vulnerable in our society -- our children. Cuts in education programs, the school lunch and breakfast programs, cuts in women's, infants', and children's feeding programs -- are the examples of how the Republicans are paying for, again, a tax program that largely favors the wealthy. By contrast, our $63 billion tax cut aimed at working families is largely paid for by reducing the bureaucracy and trying to reinvent government.

Again, however, we do commend those that are working in this direction because we think it's the right direction. And they were courageous enough to sign this letter, although we still are trying to find out who exactly signed the letter itself. It does represent nearly one-half of the Republicans that I think are beginning to acknowledge that the middle class and working families ought to come first when it comes to any tax cut.

We would like to continue to work with them, so that perhaps they can take one big step for the middle class, the kind of step that's contained in the President's proposal.

I want to introduce the Secretary of the Treasury, and the head of the NEC, who will speak to the distribution issues in the tax cuts.

SECRETARY RUBIN: Thank you, Leon.

As you know, this year the President has sent a budget to Congress that has three very important components: Number one, it continues the process we began in 1993, the process of deficit reduction. Number two, it provides tax relief predominantly to the middle class and in a form that provides incentives for people to invest in themselves and the future productivity of this country. And number three, that has additional public investment in areas that are absolutely critical to the future of this country, particularly education, training and skills development.

This budget is one more step in the program the President began with at the beginning of this administration to create and protect the recovery, to position the country for the long-term, and to raise the wages of working families. In our view, the House Republican Contract does none of these three things.

For starters, the House Republican Contract undermines -- seriously undermines -- the progress that we have made in terms of deficit reduction, particularly the tax proposals that explode in the second five years; and secondly, the tax benefits are skewed predominantly toward the most affluent.

Let me give you a couple of specifics. The so-called neutral cost recovery and the repeal of the alternative minimum tax, while relatively moderate in their effect in the first five years, absolutely explode in the second five and are really a fiscal time bomb. In terms of distribution and families, the differences between our two approaches are striking. As the chart shows, the President in his budget directs 85 percent of his tax relief to middle-income families. By contrast, the House Contract provides a little bit more than -- a little over 50 percent of its tax reliefs to families earning in excess of $100,000.

Another way to look at the same thing is that the House Contract provides about $569 in tax relief to families earning between $30,000 and $50,000. In a sense, I think this makes it even more graphically -- $569 in tax relief to families earning between $30,000 and $50,000; and tax cuts of over $20,000 to families with incomes exceeding $350,000 per year.

The Contract both undermines fiscal discipline and reduces public investment in the areas that we think are absolutely critical to the future of this country. And that's why the President has been so adamant about his opposition to reductions and cuts that affect education, nutrition programs, and the other kinds of investments that determine whether we have a competitive society five, 10, 15 and 20 years from now.

It is a very complex world, and what the President's had from the very beginning is a complex multifaceted economic strategy. And this budget carries forward that economic strategy -- a combination of deficit reduction, tax cuts, public investment.

Let me conclude on the comment that -- on the subject that Leon referred to, and that is the letter that went out today. Clearly, this is a request from Republican members to scale back at least one of the tax reductions, to target that tax reduction more toward working families. It's a good first step, and it's a step very much in the direction that, if you follow through fully, would you lead you to where the President and our budget are.

But I think it's also very important to point out that even with this step, the fundamental position of the House Contract is unchanged. In terms of distribution right now, with a little over 50 percent of the Contract benefits go to families earning over $100,000, if this modification is made it is still approximately 50 percent of the benefits that go to families earning over $100,000. Under the Contract, the 10-year cost of the tax cuts is $630 billion, and so far, at least, with absolutely no idea how it's going to be paid for. With this modification, you still have approximately $600 billion worth of tax cuts over 10 years and still no idea of how they're going to be paid for.

Thank you. With that, I'll turn the microphone over to Laura Tyson

DR. TYSON: I just wanted to add a little more detail on how these cuts might be paid for because I think in evaluating the case for tax cuts, it's important to think about who they're for and how they're paid for.

Our proposal, which was targeted very much at working, middle-class families, was designed to deal with those families who's income had either stagnated or fallen over the past 20 years. And that's been very well documented. If you look at median household incomes, they have been unchanged from 1973 to 1993 in real terms. Moreover, during that 20-year period, the distribution of family income has become increasingly unequaled. The bottom 80 percent of the family income distribution actually saw their share of family incomes decline. It's only the top 20 percent that has really seen an increase in the share of total family income in this society in the past 20 years.

So we targeted it to the middle class. But when we asked ourselves how should we pay for this, we also paid attention to what we thought were the underlying forces behind the stagnation of family income and behind the increasing disparity of family income. And we believe that a major set of forces really is that changing technology and changing global competition has shifted the demand for labor away from those with inadequate skills and inadequate education towards those with college education and post-college education, certainly post-secondary education.

So we've been very much motivated to target our tax relief to help people acquire the training and skills they need, for example, through the proposed deduction for post-secondary training and education; and at the same time, we've tried to couple our tax relief for the middle class with a support, increasing support for education and training programs.

Now, if you look at the Republican proposals, which are proposals designed, as we've demonstrated, disproportionately to benefit the wealthy, those families that have done well in the past 20 years -- if you look at how they are proposing to pay for these, if you look at the rescission package, if you look at the Kasich budget proposals, the illustrative spending cuts, if you look at other statements that have been made, if you look at the House Ways and Means discussion on welfare, you will see that basically the means for paying for tax cuts are falling disproportionately on children and disproportionately on the education.

So, in fact, what's happening is that exactly the means that the middle class needs to increase their income and to help their children move into high-wage jobs of the future, exactly the education and training programs they need, the middle class need, are going to be undermined, underfunded, eliminated in some cases altogether in order to pay for tax cuts for the wealthy.

Now, we can go through the list. They're illustrative, but when you put all of these proposed cuts together, they paint a very compelling picture. There are proposals to cut Goals 2000, the program that is designed to help schools around the country raise standards with parental involvement, to raise the educational standards of children as they move forward out of K-12 into post- secondary education.

There are proposals to eliminate funding for drug-free schools and communities. This is funding that is designed to help schools prevent drug use and violence, again, using parental involvement and children involvement. There are proposals to cut school lunches -- you've heard a lot about that -- to cut education technology and improvement; to cut teacher training and math and science; to cut education, training and employment services.

In the Kasich budget proposal, as an illustration, he suggests cutting $10.2 billion, including cuts on literacy and adult education. Those would be the very funds that we propose using as skill vouchers that would go directly to American workers to allow them to get the training they need to move to better job opportunities. So that kind of cut could eliminate three million training vouchers for American workers.

I could go on, talk about national service, talk about the student loan program, the new direct lending program which has been proposed by some Republicans for cutting back. I just want to end by saying when you look at the package, though, you see on the one side, tax relief for those that have benefited disproportionately over the past 20 years, and the undermining of those programs in education and training which are really the means by which the middle class -- the working middle class -- who have seen their incomes stagnate can hope to move forward to better jobs in the future.

Thank you. And we're here for questions.

Q: the result of this was that no tax cut came out of the Congress -- given the fact that so many economists think that the tax cut the administration wanted included is more political than economically necessary?

SECRETARY RUBIN: Well, I don't know that most economists think that. But let me tell you what -- we spent endless hours in the latter part of last year on the budget. What we came out with was the tradeoff that we thought made most sense for this country in terms of the things that we talked about before -- protecting the recovery, position the country for the long-term, raising the wages of working Americans. I think we reached a sensible balance between tax cuts and deficit reduction. That's the President's budget. It reflects a very-well-thought-through economic strategy. Now I think you have to wait and see what the Republicans do. And as you know, they are required under the Budget Enforcement Act to pass a budget -- adopt a budget, vote on a budget by April 15th.

Q: Mr. Secretary, you attended a retreat over the weekend with some senators. Could you tell us what, if anything, you agreed upon? Where is there a common ground between the White House and the Republican leadership?

SECRETARY RUBIN: Let me restrict my comment, Wolf, to the following. I did attend the retreat. It was very gracious of them to invite me, and it was the Senate Finance Committee, as you may have noticed in the front page of The New York Times today. I was their guest and I think it was a very interesting and well- constructed retreat.

I decided when I left there I wouldn't comment on the content of the retreat. As a guest, it seems to me not appropriate for me to comment. I will say that in terms of my own views I was intervally involved in developing the President's budget; I think it's a very sensible tradeoff between the various kinds of things that you need to do if we're going to have an effective economy five, 10, 15, 20 years from now. And I very strongly support the budget as we constructed it and all of us agreed upon it with the President.

There was an inadvertent -- let's call it misreporting, if you will, and we have asked for a correction in terms of the article on the front page of the Times today.

Q: What was the problem?

Q: What was incorrect?

SECRETARY RUBIN: What was incorrect is whatever inference you might have drawn from it other than what I just said. (Laughter.) If you inferred from it what I just said, then it was correct and we shouldn't have asked for a correction. Some people drew a slightly different inference in terms of my view of what had transpired. So we asked for a clarification.

Q: You asked for a correction based upon what you think somebody might infer? What exactly did you say? (Laughter.) When you asked for this correction, I mean. How in the world would a newspaper editor ever be able to figure that out?

SECRETARY RUBIN: Oh, I don't think it's too hard for them to figure out because I think they -- it was reported --

Q: Why don't you just give us a straight answer?

SECRETARY RUBIN: That's a straight answer. The straight answer is that we put out a statement saying that I had attended the conference, that I was delighted to be there, that I wasn't going to comment on what transpired at the conference, and then putting that aside, my own views are that the President's budget reflects a very sensible tradeoff between the various considerations going into constructing a budget, and the consequence was we wind up with deficit reduction and tax cuts.

If you read the article I think you could get a somewhat different impression. And, in fact, they did make an editorial error. It was actually -- they, themselves, said that there was an editorial --

Q: Did they say what it was?

Q: Well, let's try this another way. Do you support Senator Packwood's proposals that no tax increases be approved until much deeper spending cuts than the ones that you have proposed are put in place?

SECRETARY RUBIN: No. My personal view -- and it was a view that I came to over many, many, many hours as we in the economic team sat and worked with the President -- is that we developed a very sensible tradeoff between tax cuts and deficit reduction, and that we had a budget that was many faceted just as the issues of the economy are many faceted, and it was well suited to both continuing the process of deficit reduction that we began with the budget in 1993, we continue with this budget, and that we would look forward to carrying forward with health care reform, and -- wait a minute -- and had two other components in it: One, tax cuts to deal with -- in part, to deal with distributional problems that Laura mentioned, and in part to provide incentives for people to invest in themselves, and then, finally, the public investment programs, particularly what he called the G.I. -- equivalent of what had been the G.I. Bill of Rights, the skills program.

Q: Did you give Senator Packwood or the other senators there an indication that the administration, as compared to your personal view, would take the position that his spending cuts and -- behind his position. I'm just trying to see if there's any space here between your personal view and the administration's view.

SECRETARY RUBIN: No. My personal view is as I've just described it -- tracks exactly with the President's budget and the President's view. The answer to your question is there is absolutely no space.

Q: Mr. Secretary, let's get back to the question of -- given the need to continue, presumably, deficit reduction, isn't that more important right now than giving a tax break to the middle class?

SECRETARY RUBIN: I think, Wolf, that the economy is a very complicated set of questions, and I think that you've got to deal with a lot of different problems, but not at the same time, and not be monodimensional in the way that you -- I don't know if that's a word or not, but if it isn't, use it anyway -- monodimensional. If not, Bill Safire can write about it in the Sunday New York Times -- monodimensional in the way that you approach the economy. I think you've got to do a lot of things at the same time.

We've got to continue on a deficit reduction track that we began in a very powerful way in '93. I think it is absolutely essential that the American people get the education, skills and training they're going to need to be competitive 5, 10, 15 to 20 years from now. And I do think you have a terrible distributional problem which you've got to try to do something about. And this budget reflects the complexity of the problems that our economy faces.

Q: If the Senate were to preserve your skills and educational proposals but to drop the family tax cuts, would that do any damage to the economy?

SECRETARY RUBIN: If you're asking me whether I think the child tax credit is a sensible proposal, the answer to the question is yes.

Q: That's not the question.

SECRETARY RUBIN: What was the question then? That's the best way to -- we both interpreted it that way. You try again.

Q: Would it do any damage to the economy if the Senate were to block it?

SECRETARY RUBIN: Well, you'd lose the benefit that we think you get by putting it in there which is to say providing young families who are very often the families with the most difficult time economically with some additional resources to deal with their children. So we obviously think that that would have a disadvantage, yes -- if that's responsive to your question.

Q: Mr. Secretary, I take it you do subscribe, however, to Senator Packwood's view that tax cuts of the magnitude envisioned by the House Republican leadership are unsustainable.

SECRETARY RUBIN: I think that the tax cuts in the House Contract are exceedingly -- both the magnitude and the content are not in the interest of this nation's economy. That is correct.

Q: So how do you bridge the difference between preserving what you think -- I mean, coming back to Ann's question, I'm not sure about the daylight that is there. If you think that their cuts, as you've said all --

SECRETARY RUBIN: Well, they've proposed cuts that we estimate will cost something like $630 billion over 10 years.

Q: I understand. And you've also --

SECRETARY RUBIN: Our programs cost $63 billion over five years. And it has different content, different substance.

Q: I just want to know, if you won't subscribe to the notion that any tax cut doesn't make good economic sense right now or perhaps might not be the best policy choice, how do you continue in the face of simply by saying that yours is reasonable and just right and Goldilocks?

SECRETARY RUBIN: Oh, I think ultimately -- I don't know about Goldilocks -- but ultimately, you make judgments about what makes sense. And the judgments that we made, and I think rightly so, was that -- as you sit and you compare different tax reductions with deficit reduction and you compare different tax cuts against each other, you make a judgment as to what you think will do the most good for the economy. And these were the judgments that we reached.

Q: Was there an consensus reached at this retreat on Social Security?

SECRETARY RUBIN: I think you need to ask Senator Packwood.

Q: He's not commenting; he was a guest.

SECRETARY RUBIN: I was a guest, Wolf, and I really don't want to comment on what went on at --

Q: But should Social Security be on the table, as has been reported emerged from this weekend retreat?

SECRETARY RUBIN: Well, Social Security is not the deficit issue at the moment. The deficit issue that faces us in the more immediate future is the question of health care entitlements, and, as you well know, our view on that is that they need to be dealt with, and they need to be dealt with in the context of health care reform.

Q: Mr. Secretary, the dollar touched record lows again today. Is the market being monodimensional in not believing that you want a stronger dollar -- (laughter) -- or has your policy on the dollar been a failure?

SECRETARY RUBIN: Well, the dollar -- I don't know what currency you were looking at, but the dollar against the mark actually was quite a bit stronger.

Q: I think against the yen, I think earlier today, it touched --

SECRETARY RUBIN: Yes, against the yen it was somewhat lower. Depends on what you look at. (Laughter.)

Q: It was higher against the peso.

SECRETARY RUBIN: No, it wasn't higher against the peso because there's some sort of holiday in Mexico. The peso is not trading. (Laughter.)

The answer to the question on the dollar is that having traded for as long as I did, 26 years, one thing I learned from having sat on that side of the table is that there's a strong tendency to tea-leaf read on what people like the Secretary of the Treasury and the Chairman of the Federal Reserve Board say, and the result is, the less they say, the better -- which leads me to the statement I always make which is that we believe that a strong dollar is in the interest of this country and then not comment beyond that.

Q: But the markets don't seem to believe you -- keep driving the currency down.

SECRETARY RUBIN: I'll stick with the comment that I always make. I really, truly believe it's the right thing for me not to comment beyond the comment that a strong dollar is in this nation's interest.

Q: Mr. Secretary, when you look at the letter from the Republicans today in conjunction with the poll findings of the Post this morning, do you feel that you are finally turning the corner in the administration's battle against the Contract, that the country is slowly coming around to your view?

SECRETARY RUBIN: I think the White House should respond to that.

DR. TYSON: That's right. I'm now the White House. Well, if you don't mind, I will respond. I think we have made it very clear from the beginning that our effort on the budget, on the deficit, how much deficit reduction to do, how much tax relief, where should the tax relief be, how much additional spending, in what programs, what programs should be cut -- all of that has been motivated from the very, very beginning by a desire to help American families, working American families, have the skills, the education, the opportunities they need to improve their living standards and the living standards of their children. This has been from the very, very beginning.

Now, I think what has happened here is that as more knowledge has come out about the Republican tax proposals, about the fact that the top one percent of the income distribution gets 20 percent of the benefits in the proposal, that the average cut for those one percent -- the top one percent of families, that's 1.1 million families -- is $20,000 a family -- those facts are now being heard.

At the same time, people are seeing what it is that would be cut to pay for these tax cuts for the very rich. And those things that would be cut are things that Americans care about. They care about student loans. They care about children's lunches. They care about improving K through 12 education. They care about the ability of high school and college students to be engaged in national service and give something to their community and get something back to support their education. Americans care about those things.

And I think what's happened is that as more about the Republican budget cutting strategy for tax relief has been revealed, Americans have come to recognize what that means and to see the contrast of that with what we're about. We are for working class middle income families.

Q: Can this country afford everything that Americans care about?

DR. TYSON: I think we're done. Well, you said it was the last question. Do you want us to continue?

MR. MCCURRY: Well, you can answer that one. We're done. (Laughter.)

DR. TYSON: Do you want me to answer that question? Do you want me to answer that --

MR. MCCURRY: Yes, why don't you -- you can answer -- I have an answer.

DR. TYSON: What was the question? Ask me the question again.

MR. MCCURRY: Can we afford everything that we want.

Q: The question is can we afford everything that --

DR. TYSON: No, no, I think -- I think Americans also clearly understand that we live in a world where we've inherited a huge debt, we've inherited a huge deficit problem. We have made progress on it. More needs to be done. Americans recognize that in poll after poll. And I think they recognize that we need to continue to work on that. We are continuing to work on that.

And after all, I think we should never forget in these discussions that so far there is only one -- one -- budget proposal before the American people. And it is the administration's budget proposal. And until there is a budget proposal that is before the American people that has been voted on and meets the deadline, we shouldn't even be having this debate. I mean, there is one proposal. We have been serious about the deficit, and we were serious from the very beginning.

We can't have everything. You have to make tradeoffs. We believe, as the Secretary of the Treasury said, that our set of tradeoffs -- balancing, continued deficit reduction with targeted and modest tax relief for the middle class, and some increases in spending on children and education and training -- is the right tradeoff. A little bit of each thing.

MR. MCCURRY: Perfect. That's another way of saying that without scarcity there would be no economists, so --

Q: Well, thanks a lot, Mike.

MR. MCCURRY: Thank you. I'm glad that I could entertain you today.

All right, anything else? Let me just give you one other heads-up on an item we'll have later on this afternoon. The Office of Science and Technology policy will be releasing the annual National Critical Technologies Report.

Director Jack Gibbons, among other things, will note that while the United States remains the world leader in 27 technology areas deemed critical to the national and economic security of the United States, the U.S. lead in a lot of these areas is increasingly vulnerable as the rate of technology enhancement improves in other industrialized economies. Among other things, the report will make the suggestion that that makes a pretty persuasive case that now is not a good time to be cutting back on funding that is critical for science and technology R&D. But I'll command that to your attention. That'll be -- we'll probably have that available here, but you can also track it down through the Office of Science and Technology Policy press office, 456-6018.

Q: Has Japan responded to the U.S. offer of assistance in dealing with this poison gas attack?

MR. MCCURRY: We've been in contact with them. I don't know that they've -- I don't know that a response was necessarily required. We've had some discussions back and forth with them and continue to have available any expertise that might be useful to them, both through U.S. forces stationed in Japan and then other clinical and public health expertise that we might have as well.

But I'll check and see. I think -- I don't have anything that indicates that they've made a specific request yet, but we'll keep tracking that. If they do, we'll report back.

Q: If I could just follow up -- how serious a threat of copycats is there in the United States? And what, if anything, is FEMA or other federal agencies doing to prepare for that contingency?

MR. MCCURRY: Well, the federal government has a pretty robust capability. And when it comes to working with state and local authorities to deal with a wide variety of disasters, they do specific response plans for a whole variety of potential incidents, including that might involve chemical or radiological hazards.

This is part of the ongoing training work that FEMA does. And I think it's -- suffice it to say that both within the Justice Department and within the Defense Department, they have a capacity to deal with a wide variety of contingencies. They plan for that. They train against that. In fact, they -- just underway prior to this incident in Tokyo, they were reviewing some of their plans and capabilities as part of their routine evaluation of how they would respond to a disaster. We feel very confident that they've got good planning in place to deal with incidents of that nature. On the other hand, some of these senseless and random acts are not always entirely possible to prevent. So we just have to do the best we can when we see those types of contingencies develop.

Q: Mike, has the President or the White House done anything today to try to exert any influence on Democratic senators to not filibuster the line-item veto bill?

MR. MCCURRY: Well, we're watching the developments up there, but as we indicated yesterday, it will be up to the legislative branch to produce the strongest possible line-item veto measure that the President wants so you can exercise the line-item veto in cutting wasteful federal spending. We'll leave it up to them to draft the legislation and we'll sign it.

Q: Will someone --

Q: And that's a no I take it.

MR. MCCURRY: Well, they're going to be with this issue for a while. We'll watch and monitor the debate on the Hill.

Q: Is it possible that the President would get involved? I mean, he normally has not gotten involved in such issues before, and some are saying that, on the one hand, he's supporting a line-item veto, but, on the other hand, he's really doing nothing to try to push it through.

MR. MCCURRY: Well, we'll watch, as I say, watch and see how that develops as the week goes on.

Q: He is really for it?

MR. MCCURRY: His statement couldn't have been clearer yesterday.

Q: If he felt it was in any jeopardy, would he take the kind of steps Josh is suggesting?

MR. MCCURRY: We believe that, given the sentiment on the Hill in favor of line-item veto, that it won't be in jeopardy. And we look forward to getting a bill that the President can sign and begin using the line-item veto promptly.

Q: Specifically on the version that Dole has put forward, does the President look forward to having to sign his signature 1,500 times every time he gets an appropriations bill?

MR. MCCURRY: He doesn't mind using the pen -- there are more pens to hand out in bill signing ceremonies in that case. (Laughter.) But there are also -- given the structure of that type of proposal, there would be also opportunities for the President to prevent unnecessary spending and unwise tax expenditure. So that would be -- I think in the view of the President, would further the objectives that he has in seeking support for the strongest possible line-item veto to begin with.

Q: Are you guys doing any kind of time or motion studies as to how much of his time will be monopolized by this? (Laughter.)

MR. MCCURRY: It will come out of progress in the name of the national interest, that category, in his time-motion evaluation category.

Q: There are about 500 or 600 New York State Democratic activists and community leaders here today and tomorrow. What's the purpose of these sessions?

MR. MCCURRY: They've just been, on occasion, from time to time, inviting a variety of people to what we call State Days. Folks from -- opinion leaders from a given state who come to the White House, get a briefing on areas that are of interest to that particular state, and then broader policy briefings on developments that are important to the White House and items that are presumably important in the individual states. These have been going on for some time now. They do them from time to time. New York, because it's a large state, I believe has two days scheduled, today and tomorrow. But they usually get a full day of briefings. They have a reception over at the White House with the President. It's a way of -- good way of staying in touch with critical community leaders from individual states.

Q: Texas didn't get two days. (Laughter.)

MR. MCCURRY: Texas didn't get -- they'll probably get one -- they'll get another day on the second round maybe. (Laughter.)

Gee, not a lot of questions out here today.

Q: Anything on the affirmative action update?

MR. MCCURRY: No.

Q: Is the President going to have an interim report?

MR. MCCURRY: Nothing new.

Q: Could you talk about the meeting? You were going to get a readout on the Cabinet -- the meeting with the Cabinet officials.

MR. MCCURRY: The meeting with the Cabinet yesterday --I understand that those present gave evaluations of some of the work of specific affirmative action exercises or programs in their individual area of responsibility. And also with that group, all of whom the President respects greatly, he got an opportunity to hear from them personally on the issue, as he continues to reach out and touch base with a variety of those who think about it and work on problems related to equal employment opportunity.

Q: Did any of the Cabinet members there mention any specific affirmative action program under their jurisdiction that wasn't working?

MR. MCCURRY: Yes, the conversations ranged from the general to the specific. I'm not going to get into the --(laughter.) Wide range of activities.

Q: Is he definitely going to Arkansas?

MR. MCCURRY: Is the President definitely going to Arkansas? He's definitely planning to go to Arkansas. And ask me that question next Monday.

THE PRESS: Thank you.

END 2:29 P.M. EST