George W. Bush photo

Press Briefing by Tony Fratto

July 10, 2008

James S. Brady Press Briefing Room

12:15 P.M. EDT

MR. FRATTO: Good afternoon, everyone. A couple things for you. General Petraeus and General Odierno -- we're expecting votes on the two generals on the floor this afternoon. I think we just heard it will be at 2:00 p.m. on the Senate. So, you know, very hopeful that the Senate will confirm both General Petraeus and General Odierno -- General Odierno as the new multinational force commander in Iraq, and General Petraeus as the commander of Central Command.

While serving in Iraq, General Petraeus and General Odierno have proven to be two of the finest military leaders in our nation's history. The President is confident that they are the best men to serve in these positions. They will both do an excellent job in leading our troops to confront challenges in the war on terror and helping to keep our nation safe. And so we look forward to a vote in the Senate floor this afternoon.

Also, I know I heard from a lot of you after you saw the Senate vote yesterday, after the successful passage of the FISA bill, the vote on the Medicare physician reimbursement bill. As you know, we had a senior advisor's veto threat out on this bill, and we had a SAP that spelled out all of our objections to this bill. And the questions I know I received were, does the President still intend to veto this bill? And the answer is yes. Our concerns with this bill -- actually, let me back off and just talk about -- one of the goals of this bill was to ensure that physicians get their reimbursements. If the President want to -- wanted to see and wants to see physicians get their full reimbursement. That was never an issue in this whole debate.

What became an issue was how the Senate and how the Congress chose to pay for this bill, and the way they did it was to make very steep cuts in the Medicare Advantage plan. Our view has always been that we trust customers to make -- consumers to make smart choices. We want to make sure that they have the information and that they have choices. Taking choices away from seniors in order to pay for the reimbursement for physicians is the wrong way to pass this bill and to extend the reimbursements that we want to see physicians get.

So we're disappointed in that vote. The President does intend to veto it for that reason. We're concerned about the impact of that should this bill eventually become law. We expect that one of the impacts of this bill is it will remove about 2 million seniors from a wildly popular Medicare Advantage private plan. We don't want to see choices being removed from the 9.6 million seniors who are in this program, and our estimates lead us to expect that as many as 2 million seniors will have to drop off the Medicare Advantage program, and that's the wrong way to do it.


Q: Iran's state television says that there was more missile tests today. Does the United States have any indication that that test did not happen or did happen?

MR. FRATTO: I don't have any -- I don't have our own -- U.S. government verification that there were any additional tests. I think, you know, that -- but they did test the day before. That --

Q: I'm asking -- the United States watches what happens around the world, particularly in a place like Iran.

MR. FRATTO: No, I understand, Terry, and all I'm saying is that I can't -- it's nothing that I can confirm right now, and maybe that's something that can happen later. But on the subject of testing missiles, you know, the -- nothing changes with respect to the way the Iraqi government is putting the Iraqi people in a very isolated position -- I'm sorry, the Iranian people in an isolated position because of these tests in defiance of the international community.

This -- these are -- these tests are in violation of -- or the expanded use of ballistic missiles are in violation of U.N. Security Council resolutions. We are dealing with the threats in Iran in a very direct way through the P5-plus-1 process. We have -- Mr. Solana will be in Iran next week to continue these discussions. We want to see them stop enriching uranium, and we'd like to see them stop these provocative tests that only further isolate the Iranian people.

Q: It seems odd that in the time between the gaggle and now you haven't been able to confirm the tests, because we've seen purported video of the test.

MR. FRATTO: We've also seen, you know, Photoshopped pictures on the internet of missile tests. Yes, I --

Q: If I'm not mistaken, the intelligence people are talking about it to some other reporters.

MR. FRATTO: Yes, I checked, Bill, and I wasn't able to get confirmation on that.

Yes, Goyal.

Q: Two quick questions. One, do you have any idea who is helping Iran in their mission to get the nuclear and missile technologies?

MR. FRATTO: Not beyond -- I can't speak beyond the people named in official sanctions. There are individuals and entities named in U.N. Security Council sanctions. I can't go beyond that.

Q: And second, as far as President meeting with Prime Minister of India and also discussing about civil nuclear agreement between India and the United States --


Q: As far as the nuclear deal is concerned, it may not be in trouble because it will go through in India because -- but the government of Prime Minister Manmohan Singh is in trouble -- the government may fall any time. What I'm asking you is that, if it was discussed with the President that if President is going to help India as far as (inaudible) Nuclear Suppliers Group is concerned to get this deal through.

MR. FRATTO: I wasn't there when -- you know, at their bilateral meeting. I would be -- I understand that they did talk about the nuclear deal. On that specific, that's not something I could confirm, but we do appreciate Prime Minister Singh's willingness to move forward with this deal. It's a historic agreement, this strategic partnership, and we think the initiative will help strengthen global nonproliferation efforts. So it's a positive thing and we appreciate the commitment by the Prime Minister.


Q: On Iran -- I realize you can't confirm the second test, but at the very least it looks like Iran and Israel are kind of flexing muscles back and forth, with the missile test, and then the Israelis come with the new plane, and there's kind of a war of words underway already. Is the President concerned about the tone between these countries? And is he concerned that perhaps more needs to be done than just sending Solana next week to Tehran?

MR. FRATTO: No, look, I think -- Secretary Gates characterized it as sending signals yesterday. That was his take on it. I don't have any reason to have a different view on that. The bottom line is, though, that what we are focused on is the bigger picture of trying to encourage the Iranian regime to join the international community and deal with these very real concerns that we all have. Remember that the -- you know, the Security Council resolutions dealing with Iran were unanimous votes in the U.N. Security Council.

The world stands united on this. The President, in his bilateral meetings and meetings at the G8 meetings over the recent days, Iran was a point of discussion. His visit to Europe a few weeks ago Iran was an important part of discussion. We saw the European Community move forward with sanctions. What our goal is is to use diplomacy as best as possible to bring Iran to the table in a way that we can resolve this peacefully.

And we know that from time to time that things like missile tests or movements in the Persian Gulf of ships and so forth are going to take place. We don't want to be distracted by that and try to stay focused on the diplomatic efforts, which we think, if we stick together with our allies on this, that we can be successful.

Q: But is there a concern with hostile countries carrying out war games in close proximity that there could be a mistake or a misinterpretation of something that leads to something very real?

MR. FRATTO: We hope that's not the case. We hope that there's sufficient communication from everyone involved, and that they're seeing these things in a clear-headed way, and thinking in a clear-headed way also.


Q: With tensions increasing between Russia and Georgia, is there any plans for the President to speak directly to Russian President Medvedev to try to calm the situation?

MR. FRATTO: Not that I'm aware of. I know that they spoke recently in Japan, and Secretary Rice of course is in Georgia -- I'm not sure if she's left yet. Secretary Rice will report back to the President on her views on that, but I don't have anything on expected talks between -- additional talks between the President and President Medvedev.

Q: Is President Bush pleased that Barack Obama voted for FISA yesterday?

MR. FRATTO: We would have like to have seen a 100-0 vote for FISA, because it's such an outstanding bill, it's an important bill. I'm not going to comment on any one member's vote for it; they can answer for themselves as to why they voted for it and what the thinking was. We would have liked to have seen every member vote for it.

Q: Does he have any thoughts, perhaps, on why he was able to win over some Democrats, such as Barack Obama, who before indicated that they wouldn't vote for it?

MR. FRATTO: I don't have a comment on what Senator Obama's thinking was on it. But there were a large number of Democrats who voted for the FISA bill, and we think for very good reasons. And one of the leaders in crafting this bill and crafting an earlier bill was Senator Jay Rockefeller, for example. And there was great bipartisan cooperation on this to make sure that it gave the intelligence community the tools they need, but also significantly protected civil liberties. And that was something that was important to us also.

So this bill was, you know, very -- thoroughly debated. It was negotiated by very serious people from both sides of the aisle for a great deal of time, and really going through every word in this document to make sure that it accomplishes what we think is necessary for the country to keep it safe, but again also to protect civil liberties. And I think that's something that people on both sides of the aisle felt that they could support, and we saw that in a very strong vote yesterday.

Yes, John. Okay, then I'll get you next.

Q: Any look ahead to the event tomorrow on the economy and --

MR. FRATTO: Yes, I think it'll be a good opportunity to get a review of what we're seeing in the economy today, both in the real economy -- I think I mentioned in the gaggle this morning that we're getting down to the last days of the stimulus checks that have gone out. So maybe we can get -- the President will have an opportunity to get a little better reading from Secretary Paulson and his other economic advisors.

We're going to be at the Energy Department. That's no -- that's by design. We want to be there to talk about what's going on with energy markets and oil and to -- and the opportunity to help bring down prices and increase supply here domestically. So the President will have a chance to talk about those issues, also the Outer Continental Shelf and refinery issues that you heard him spoke about -- speak about not too long ago. So it'll be a good review, but they'll certainly focus on energy.

Yes, Kevin.

Q: Speaking of that, Tony, there's been some talk on the Hill about maybe accessing some of the SPR -- just putting extra oil in the marketplace to drive down -- looking at nearly $5 a gallon for most people at this point. Has there been any consideration for that?

MR. FRATTO: Look, I think it's good that there are members who are interested in increasing supply of oil here. I think what's disappointing is that the only place they can seem to want to access that supply is in this storage of oil that we set aside for dealing with national emergencies.

Now, there are other supplies of oil out there that we'd like to access, and that's the Outer Continental Shelf and ANWR. And these are places that, were we able to explore and eventually bring to market oil from these sources, that have a long-term impact on prices, rather than some, you know, very minimal short-term impact on prices -- and at the expense of a resource that is here for us to deal with an emergency. We did it dealing with an emergency after Katrina, where we had a supply disruption. If there were an attack on a major pipeline somewhere that would disrupt global supplies of oil, that's what those -- that's what the Strategic Petroleum Reserve is for.

It is not there to try to market-time and to try to manipulate prices in the market. And unless you wanted to do very large withdrawals of the -- from the fund, it wouldn't have a lasting impact on oil prices. So we'd like to see members think a little bit more long term and take advantage of the opportunity that we have to do drilling from our domestic sources.

Q: Would you do short- and long-term then?

MR. FRATTO: I'll come to you next, Ann.

Q: Would you want to do sort of a concert thing -- take some from SPR and if -- (laughter) -- in one hand watches the other, they say, okay, maybe we can get a little bit of ANWR, let's get some oil in the market place now because it's hurting families, it's hurting people, and they need it in the short term.

MR. FRATTO: Yes, I haven't heard that discussed, but you do -- you are obliquely talking about something that we have heard members who may have previously been against opportunities for drilling, and we're getting some signals that they may be interested in looking for ways that we can find a way to increase exploration and drilling in some of the areas that the President talked about. And that would be a good sign because we would like to try to get something done on this issue.

Yes, Ann.

Q: Has President Bush been told that $4 a gallon is now the new normal? Does he expect prices to fall below --

MR. FRATTO: We heard it's not the new normal. He hasn't heard -- no one has --

Q: Start -- with a cup in your --

MR. FRATTO: Sorry, Ann --

Q: We can hear you better without a cup of water. (Laughter.)

MR. FRATTO: I don't think anyone would have told the President that $4 a gallon is the new normal, and we certainly hope it's not the new normal. It is very, very difficult to try to predict gasoline prices as to where they're going in the future. No one was predicting that we would continue to see gasoline prices increase beyond where they are today.

Q: So does President Bush believe that gasoline prices may fall below $4 or go back to $3 or back to $2?

MR. FRATTO: No, no, the President isn't making those kinds of predictions. What he's saying is that we have a situation where we have rapidly increasing and increasing for, you know, pretty much as far as we can see, global demand for oil. And right now as long as we keep the sources of oil off the market, we're not going to see increases in supply. And as anyone who has taken an Econ 101 course knows, that if you don't increase supply and you only increase demand, prices are going to rise.

Q: Does the President believe the price of gas -- there is a chance it would drop below $4 a gallon?

MR. FRATTO: All I could say is that we would be hopeful that it could, but the best way to ensure that it does is that we take some of these necessary measures and send a signal to the market that we intend to bring supply on and that we intend to continue as we've done on the conservation side through increased fuel economy standards and through the increased use of alternative fuels, so that we can try to lower the demand on oil as we're increasing supply.

Q: Tony --

MR. FRATTO: I'm going to go to April, Les, and I'll come back to you.

Q: Okay, thank you.

Q: Tony, going back to the economy and the stimulus checks, you said this is the last week that they're getting them. Now is this for the group that paid their taxes on time by the April 15th deadline, because I understand that the stimulus checks -- there's still more stimulus checks for like the elderly who filed late, what have you.

MR. FRATTO: Yes, that's a really good point. I'm actually glad you brought that up. No, this is on the regular run of stimulus checks, the sort of universe of people who had already filed tax returns. There are a not insubstantial number of seniors and veterans out there who we've been trying to encourage, and I know the IRS has been trying to reach out to them to -- these are individuals who don't ordinarily file an income tax return, and we've been trying to encourage them to file an income tax return even if they don't have reportable income, so that they can take advantage of this stimulus check and make sure that they get it.

Q: As I understand it, Tony, if someone would file late but still file, they would still get their stimulus check, too?

MR. FRATTO: Oh, yes, absolutely.

Q: Okay. And now on New Orleans really fast.

MR. FRATTO: On the -- New Orleans, yes.

Q: New Orleans, Census Bureau stats. What do you attribute that to, as the population is still down, but the city is growing?

MR. FRATTO: Yes. I think we would need either New Orleans officials or Census Bureau officials to give you an authoritative answer on that, but remember you had a large outflow of people into New Orleans, and it could be the flow back of people returning to New Orleans who -- that are showing up in that rapid increase. But, you know, we know New Orleans is a wonderful place. It's a wonderful part of the country. It's an incredibly beautiful and historic city, and want to see it returning. We are trying to make sure that it always has -- that it has the resources necessary to rebuild after the hurricanes and that -- you know, for another additional few hundred years on its history that it remains a great destination not just for people at conventions and Super Bowls, but also people to live. And so that was a -- that was good news to see, certainly.

Q: Will this be a blemish on the President's legacy, even though it's -- I mean, we have six months left and this was one of the worst tragedies that happened during his presidency. Will this -- do you think that within this time he can turn the mind-set around, where people will not look at this as a blemish on his presidency?

MR. FRATTO: I think there's a lot of history to be written on -- with respect to Katrina. It was a -- you know, obviously a devastating storm. It was devastating to the people of that region. It exposed some weaknesses in our ability to deal with a natural disaster of that size and scope. I'm not sure that at any time that a federal government and state government and local governments would have had the capacity to deal with that kind of storm, but one thing that I hope is part of the legacy is what was learned from that storm of what's needed to be able to respond to large natural disasters.

And I think we saw that FEMA's response to the Midwest floods, where I think all of the local communities and states were noting FEMA's terrific response in that region -- not just FEMA, but all of the other agencies -- DHS and the Small Business Administration and HHS and Department of Agriculture who were all working together, well coordinated, and being able to deal with these large natural disasters.

So that was, you know, something good that comes out of it. We want to see New Orleans rebuilt and the residents can continue to be proud of their city.

Yes, Les.

Q: Thank you very much, Tony. Two questions. First, does the President agree or disagree with what Fox News reported of Senator McCain's questioning the credentials of Bill Clinton to discuss the mental health of prisoners of war?

MR. FRATTO: I'm not aware that the President knows of that issue, so I have nothing on that.

Q: Does the President believe it was right for The Washington Post, for The New York Times, and The Washington Times to have all --

MR. FRATTO: Are any of them here to defend themselves? Doesn't look like it. (Laughter.)

Q: -- no -- to have all censored what The New York Post reported as the threat of castration? (Laughter.)

MR. FRATTO: That's for your industry to work out.

Q: Thank you.

MR. FRATTO: Thank you.

END 12:38 P.M. EDT

George W. Bush, Press Briefing by Tony Fratto Online by Gerhard Peters and John T. Woolley, The American Presidency Project

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