Washington, DC–(ENEWSPF)–July 29, 2011 – 12:48 P.M. EDT
MR. CARNEY: Good afternoon, ladies and gentlemen. Thank you for coming to the White House for your daily briefing. Before I take your questions, I have with me here today two people who can tell you about the tangible, even historic, benefits of compromise.
Ron Bloom is the Assistant to the President for Manufacturing Policy. Heather Zichal is the Deputy Assistant to the President for Energy Policy. Together they worked closely with teams from the Department of Transportation and the EPA to reach, as I said, an historic agreement on fuel economy.
With that, I will turn it over to them. If you have questions for them about their issues, obviously ask them. We’ll get those done at the top, and then I will return to the podium to take your questions on other matters. Thank you.
MS. ZICHAL: Thanks. As Jay said, President Obama today announced an historic agreement with 13 major auto manufacturers representing over 90 percent of all vehicles sold in the United States today. This agreement forges historic — was an historic agreement that nearly doubled fuel economy to 54.5 miles per gallon for cars and light-duty trucks by model year 2025.
Achieving the goals of this historic program will rely on innovative technologies and manufacturing that will spur economic growth and create high-quality domestic jobs in cutting-edge industries across the country. Today’s announcement builds on President Obama’s agreement for model year 2012 to 2016 auto standards which will raise fuel efficiency to 35.5 miles per gallon, and begin saving families money at the pump this year.
Together, these agreements will save American families $1.7 trillion in fuel costs, and by 2025, result in an average fuel savings of over $8,000 per vehicle. Additionally, these programs will dramatically cut the oil we consume, saving a total of 12 billion barrels of oil, and by 2025, reduce oil consumption by 2.2 million barrels a day — as much as half of the oil we import from OPEC every day.
There were a lot of people that helped forge this historic agreement today — from the UAW to the state of California, environmental NGOs, members of Congress, and others. But it was the leadership from Ford, GM and Chrysler, as well as 10 other companies that joined the President today that truly deserve the bulk of the credit for their leadership and commitment to a plan that will reduce our dependence on oil, grow the economy, and leave for future generations a more secure and prosperous America.
With that, we’ll take your questions.
MR. CARNEY: Anybody have questions? Jake?
Q One complaint I’ve heard about improved fuel efficiency standards is that it means vehicles are not necessarily as safe as bigger, clunkier, but ultimately perhaps safer vehicles. I was wondering if you could address that.
MS. ZICHAL: Certainly. I think with any rule, whether it was the model year 2012 or 2016 standard, or what we’re looking to do in the future, we will be relying on additional technologies that help us achieve those fuel savings. But that’s not going to come at the expense of American safety. We’re talking a lot about different combustion engine technologies, different off-cycle credits, a host of different technologies that will help us achieve those standards and protect consumer choice at the same time.
MR. BLOOM: And I would add the DOT, which was a critical part of this dialogue, when they look at these questions and put out the technical assessment, which they did in conjunction with EPA, the issue of safety is always paramount to the obligations of DOT. So we are very confident that there will be no compromise in safety, and that has been kind of baked into all the analysis that we did.
Q Thank you.
Q What about the economic impact? Because at the beginning some of the automakers were not that excited to get on — they eventually came on. But to double the fuel efficiency in about a decade is going to mean pressure to their bottom line at a time when the economy is still struggling.
MR. BLOOM: Well, there’s no question that the automakers were challenged by these standards, and we don’t apologize for challenging them. Saving the American consumers $1.7 trillion is a worthwhile endeavor. We are confident that the automobile manufacturers will be able to absorb the additional costs and still sell cars for a profit.
But, look, they reached, and we think that’s a good thing because we think the American people are saying — and if you watch how car manufacturers advertise their cars, the American people are saying they care about fuel economy. And so if they want to sell cars to Americans, they’re going to need to improve fuel economy. And I think this is an example of industry deciding to lead the parade — seeing the trends, seeing what consumers want and deciding to get out in front of it. And I think this is exactly the kind of smart regulation that we need to do.
Q How much will these standards raise the average price of a car? Is that anything you all have done, I guess, the math or the statistics of?
MS. ZICHAL: Well, I think as I said, the standards overall we expect will save consumers $8,000 in fuel costs. And obviously, as we were having discussions with the auto companies, as well as the DOT and EPA, we’re doing analysis about where is the right place to land this policy. That factor was obviously on the table for discussion.
And as the — I think the technical analysis that you will see as this rule comes to proposal, obviously that’s something we’re looking at. But at the end of the day, these costs end up saving — these initial investments end up saving consumers over the life of the program.
Q Does that $8,000 include the potential extra cost of hybrid technology or whatever it might be? Does that make sense?
MR. BLOOM: Yes, it’s a good question. They do not. But we are very confident that the savings are a multiple of any additional cost.
MR. CARNEY: Does anybody else have questions on this issue?
Q Yes, just a quick question. As automakers begin to implement these new standards, will it create jobs as well? Will they need to bring more people on board to do it?
MR. BLOOM: Well, I think any time there’s innovation, you see good economic activity and you see jobs. And the President in his speech this morning cited two small examples. But I think it’s indicative of what’s going on.
There’s a huge amount of innovation going on in the automobile industry today. And I think, again, when you put a tough standard out there, I think there will be new kinds of activities, because whether it’s batteries or whether it’s other technologies, that’s, in fact, what’s going on right now. So whether it’s the companies themselves or whether it’s entrepreneurs who are in their basements right now imagining how they can be suppliers to the D3, we do believe this will cause a lot of economic activity.
Q Just to follow on the question of the economic impact, is there a concern that these standards could drive up the price of vehicles beyond the reach of any consumers and hit demand?
MR. BLOOM: Again, we’ve looked very closely at that. Our judgment is that the savings that consumers will receive will be a significant multiple of any increase in price, so that from the consumer’s perspective they will be way ahead.
And if you look at how people are acting in the marketplace, people are taking account of the fuel economy of a car when they buy one. Two, three years ago, trucks were much larger a percentage of total vehicle sales than they are today. And the reason people have moved to cars is because they are conscious of fuel economy.
So I think that consumers will see that, and when the companies are advertising and they look at how the companies are advertising — when they are advertising high-mileage cars, consumers are taking that into account. So obviously to implement some of these technologies will have some additional cost, but the net benefit to consumers will be enormous.
Q But that’s kind of like a leverage or a multiplier effect. What about the price point?
MR. BLOOM: Well, again, I think when people buy a car, part of what they take into account when they buy it is how many times they have to go buy gasoline. And as the President said this morning, if I have to fill up every week, I have a different view than if I fill up every two weeks. And so we believe — and I think this is what consumer behavior is showing — that people are taking that into account in terms of their buying habits.
Q Do you anticipate that any of these companies in making these changes will need future incentives, specifically funding from the government, a year, five years down the road?
MS. ZICHAL: No. I think the conversation we had with the companies specifically focused on what was technologically available and achievable while preserving consumer choice and ensuring that we were building the cars and trucks of the future.
MR. CARNEY: Okay. Thank you guys very much.
Q Thank you.
MR. CARNEY: Okay, ladies and gentlemen, with that, we can go to your questions. And I want to just — before I start, I know that I have been spending a great deal of time in the front row in particular, but the front two rows, so I really want to try to move to give other people a chance to get their questions in today.
Q Okay. I’ll ask one.
MR. CARNEY: Okay.
Q So it seems like you’ve laid out very well what has to happen to get through the matters on the Hill before you can come to a compromise. I know the House isn’t done yet. It seems like a key issue is this matter of a trigger — how do you make sure that Congress actually takes up deficit reduction without that enforcement mechanism being the debt limit, as Republicans insist it must. Is the White House involved in any way in negotiating that issue right now in these waning hours? Or do you legitimately have to wait until all the voting is done before you tackle this?
MR. CARNEY: Well, the broad answer to your question is, yes, in both parts, which is we are involved in conversations about what an end product could look like, a compromise that allows us to do what we absolutely must do, as the President said this morning.
And I think that your analysis of a major issue that needs to be resolved is accurate. It is also true that the leaders of the House on the Republican side have been very focused for days now, and in some ways if you consider the measure they took up and passed last week, for more than a week now, a week and a half, with drafting, redrafting legislation that, as it moves along, only becomes less and less bipartisan, more and more partisan, more narrowly crafted to appeal to only a sub-section of even the House of Representatives, and therefore not moving in the direction where everyone needs to arrive, which is towards compromise. And that has been their preoccupation.
So because Congress has to take action to resolve the issue of the need to raise the debt ceiling so the United States can pay its bills, we do have to wait for that process to play out before we can get focused on legitimately solving this problem. So we are continuing to have conversations as we wait for the House to finish this business of theirs.
Q Two quick questions. Is the President concerned the United States has already suffered lasting damage to its reputation with international investors?
MR. CARNEY: I would say that we are concerned because there is certainly evidence that the economy has suffered because of the uncertainty created around this debate and the circus atmosphere of our politics around what should be a serious matter, treated seriously, because we are talking about the full faith and credit of the United States government. We’re talking about the thing that matters most to Americans, which is the health of our economy and the capacity of our economy to grow and create jobs.
So some damage has been done. Now, we are a powerful country with a powerful economy, and we are the United States of America, and the American people are very resilient. We need to resolve this, and we can get on with the task of making sure we are doing everything we can to grow the economy and create jobs.
We need to make sure that further damage isn’t done, which is precisely why any measure that suggests we should be having this debate again at the end of the year is just a wildly bad idea. And any measure that suggests we should be having this debate in a way that will require the kind of votes that we’re now talking about — when you see what’s happening in the House and the efforts to get a bare majority to pass a highly partisan measure — does anyone really think that we can — that it is plausible to hold the American economy hostage to a two-thirds vote in the House and the Senate?
This is a dangerous game, and it’s not what the American people want their elected representatives to be doing.
Q Thanks. And my second question is scheduling. Will the President invite the congressional leaders back to the White House this weekend as he did last Saturday?
MR. CARNEY: Alister, anything is certainly possible. And again, we are monitoring the situation in the Congress and we will see what conversations and meetings might take place in the future. But I don’t have any to announce now.
Q The President on Monday called on the American people to put pressure on their representatives in Washington — he did so again today — by reaching out by phone or email. Is the President himself reaching out by phone to members of Congress to put pressure on them, in addition to what he did today?
MR. CARNEY: Well, as I said several times from here, and others have, that the administration, the White House, at a variety of levels, including the highest levels, have been engaged in conversations and discussions with leaders of the House and the Senate and other members. I’m not going to read out specific phone calls or meetings, but those conversations are taking place.
And in answer — really in answer to your earlier question, those conversations are taking place, but we are also having to — because this is a congressional action that needs to take place, there’s a lot of energy being expended on what is essentially an exercise to pass the measure before the House now.
Q I wasn’t looking for a readout necessarily, just wondering if the President is picking the phone up and making some calls.
MR. CARNEY: Well, again, I think you can be sure that folks here at all levels are having conversations.
Q You sort of touched on this yesterday, but in terms of the President using up so much oxygen focused on this one issue, does he ever have any concerns that he’s not able to give the kind of focus that he needs to give to some of these other issues — foreign policy issues — that cross his desk?
MR. CARNEY: Well, that’s a good question. The President has a full schedule that includes a lot of other issues besides this one, including, very importantly, national security matters. He meets, as he did this morning, with his national security team, gets updated on what’s happening around the world. And he is able to do that, of course, as he focuses on this.
But make no mistake. The American economy, the health of the economy, the fate of the economy when what is at stake is a question about whether or not we will be creditworthy is a top, top priority. It is his focus right now because it absolutely should be his focus.
Q The former director of national intelligence, retired Admiral Dennis Blair, said, I believe yesterday, that drone attacks — unilateral drone attacks in Pakistan actually did more harm to U.S. national security interests than good, and he called for I believe a stronger partnership with Pakistan. Does the White House have an opinion about these remarks?
MR. CARNEY: Well, without addressing specific methods, I would say simply that we believe our relationship with Pakistan is essential to fighting terrorism and terrorists, fighting al Qaeda. And that’s why we work hard on that relationship even though it is complicated and difficult at times.
We also make no apologies for the need to go after terrorists, members of al Qaeda, wherever they are. And that is certainly true about the mission to eliminate Osama bin Laden. And I think that — I understand that that creates tension. And we have — we engage with the Pakistanis to discuss these issues all the time. But the relationship is important and, obviously, fighting terrorism is important.
Q Can you give us an idea of what you think a compromise bill looks like, whether — the general parameters —
MR. CARNEY: Well, as the President said today, there are so many — there are many roads out of this mess, that it’s not that complicated when you look at what is contained within — what was contained within the original measure put forward by the Speaker of the House and the measure that the Senate Majority Leader is putting forward.
There is an opportunity here to achieve significant deficit reduction; create a joint committee in Congress that will take up the tough issues of entitlement reform and tax reform that this President believes needs to be addressed; to have an enforcement mechanism to ensure that the Congress acts on these proposals put forward by that committee; and that lifts the cloud hanging over our economy, this issue of the debt ceiling, through 2012.
Q How far are you willing to go? How far is the President willing to go when it comes to triggers?
MR. CARNEY: I’m not going to negotiate the specifics of a compromise from here.
Q It doesn’t sound like you’re negotiating with anyone.
MR. CARNEY: I think what our — our lines are pretty clear here. As anyone who is witnessing this debate this week, this process, can attest, this is not something we should repeat any time in the near future, because it is harmful to the economy; the uncertainty it creates will only add further harm to the economy. And that is a position the President holds very strongly.
He also is committed to reducing the deficit. And that’s why he supports Senator Reid’s proposal, which significantly reduces the deficit, up front, with cuts — cuts that overlap in large measure with some of the cuts put forward by the Speaker in his original measure.
There is room for compromise here if there is will. It is not that difficult.
Q Can you give an idea — the triggers is really what it’s about right now?
MR. CARNEY: I think there are a variety of mechanisms — when you talk about enforcement mechanisms, sometimes called triggers, there are a variety of ways to compel Congress to act because you create something that’s balanced that makes it onerous for both Republicans and Democrats not to act. And whether that’s enforced spending cuts or enforced revenue raisers, there’s some history here of how that works. And, again, if there is a will to examine that process, a will to recognize that we need to compromise and get out of this situation so that no further harm is done to the American economy, this can be done relatively quickly. There is ample time to achieve it.
Q Jay, you said it’s not that complicated, there’s an easy compromise here. And yet — and the President is backing Senator Reid’s plan in the Senate. And yet his plan doesn’t have the votes. The Republicans are not onboard on that. And so they say that when they hear from the White House “compromise,” that it’s only directed at the Republicans, that the Democrats aren’t being asked to compromise either.
MR. CARNEY: Norah, I know that you’ve watched this closely enough to understand how untrue that is, because look at Senator Reid’s measure. First of all, it achieves the arbitrary goal — utterly arbitrary goal — of doing dollar-for-dollar in deficit reduction — or spending cuts, rather — and lifting of the debt ceiling — a dangerously arbitrary goal, okay?
Q — some Republicans call phony.
MR. CARNEY: What’s phony about it? It’s their goal.
Q The defense — Iraq and Afghanistan funding.
MR. CARNEY: Well, if you’re talking about overseas contingency funds, basically funding of our wars, that was accounted for in the Ryan budget — the much-celebrated Ryan budget in the House of Representatives. It was accounted for in every bipartisan proposal that was seriously addressed in Washington these last several months, including between the Speaker of the House and the President of the United States.
So — and, again, I’ll address that. You get savings from policy decisions. If you decide, as Chairman Ryan put forward, that you need to end Medicare as we know it and reform it to extract significant savings from it —
Q I don’t want to beat a dead horse —
MR. CARNEY: — you can count those savings. If you want to make policy decisions that wind down wars in Iraq and Afghanistan, you can count those savings.
But in any case, even the first $1.2 or 3 trillion of savings that we’re talking about overlap. This is a lot of money here. This is a lot of savings. A lot of deep and substantial cuts.
There is no upfront revenue in Senator Reid’s proposal. It is just simply preposterous to suggest that it is not — does not represent an effort to come halfway towards the Republicans.
Q Is the White House involved in lobbying Senator McConnell to get onboard Senator Reid’s plan?
MR. CARNEY: Again, I’ll just go back to my — to the answer that I gave to Dan, that we’re engaged in a lot of conversations. Obviously Congress is focused on the legislation it’s dealing with now. We are having conversations on the topic of what happens once people finally acknowledge that the activity that’s happening in the House now is moot and irrelevant because it’s the measure that will, if it passes, that passes out of the House, will be dead on arrival, and we need to get to the endgame here of finding a compromise.
Q Thanks, Jay. You’ve said several times at the highest levels, there are phone calls happening from here. And yet Joe Manchin, who is one of the conservative Democratic senators who would be a swing vote here was on MSNBC this morning and said, “I’d like to see the President more engaged to talk to us, call some of us, get in everyone’s face.” If you have a conservative Democrat —
MR. CARNEY: I hadn’t seen those. I hadn’t seen those comments. I mean, I can assure you that —
Q But assuming he’s telling the truth —
MR. CARNEY: But, Ed, honestly —
Q — you presume that, right?
MR. CARNEY: We’ve all been here for the past several weeks. The idea that the President is not engaged is simply preposterous. So I say again —
Q Which a Democratic senator said.
MR. CARNEY: No, I’m just saying, and again, I wasn’t aware of Senator Manchin’s comment, but I think overall the President has amply demonstrated his level of engagement —
Q But if he’s not talking to a Democratic senator who is about one of five or six conservatives —
MR. CARNEY: Ed, I said I didn’t see —
Q — who would be persuadable —
MR. CARNEY: What’s your —
Q My question is, if the President is not talking to one of five or six conservative Democrats who are persuadable here, how are these phone calls moving towards an endgame? Who is he talking to?
MR. CARNEY: Persuadable? Fifty-three —
Q — one of these folks who is in the middle.
MR. CARNEY: Well, again, I will say upfront that I am not aware of that comment. I’m not even sure what you’re talking about — persuadable in what direction? Fifty-three United States senators of the Democratic Party signed a letter saying they will not support the Boehner measure, right?
MR. CARNEY: And —
Q Senator Reid is now saying he’s going to amend his version, and no one knows how it’s going to be amended.
MR. CARNEY: Right. And we are having these conversations, and I’m sure that they will include Senator Manchin as well as many others.
Q Let me try to get at this McConnell question one other way, because I think if you will agree with the premise that the key here seems to be Senate Republicans at this point. Do you have any indication that Mitch McConnell is going to do anything other than stand foursquare behind Boehner’s bill when, and if, it gets to the Senate?
MR. CARNEY: Mike, all I will say is that I understand that Republicans would like — if they controlled all levers of the government, would like some measures to become law. I understand that Democrats, if they controlled the House, the Senate and the White House, would like some measures to become law. That’s not going to happen. A compromise is the only option. So it’s — you can support and say that I stand strongly behind what has been produced here, but it won’t pass. And that’s clear.
Q Do you have reason to believe that McConnell —
MR. CARNEY: I have reason to believe, as the President said at the end of his remarks today, that there will be an assessment that we have to do something and the only thing that gets us there is something that’s bipartisan. That is just the case. The Democrats control the Senate; Republicans control the House.
Q Finally, you mentioned the word “bipartisan.” How does it promote an atmosphere of bipartisanship for the President to encourage citizens to call for recalcitrant lawmakers and, to use his campaign apparatus, to tweet out the Twitter handles of Republicans to encourage them — to encourage people to sort of jump all over folks to get them to vote? I mean, does that foster a sense of cooperation?
MR. CARNEY: What the President has called for is for those Americans who believe that we need compromise in Washington, to communicate that to their members of Congress. That can be Democrats or Republicans. That is hardly a partisan message. It is explicitly a bipartisan message.
Q They’re only tweeting Republicans, not Democrats.
MR. CARNEY: Well, I think the problem we’re seeing here is a lack of willingness to compromise by Republicans. But the message here is — and the message of the negotiations the President had with the Speaker, the message that we have had throughout is that we are willing to compromise; we are willing to meet you halfway and beyond in order to resolve these issues. We are willing to deal with the arbitrary association of raising the debt ceiling with spending cuts. We’re willing to discuss tough issues like entitlement reform, getting savings out of those programs, and make tough decisions and bring along Democrats to take that vote if we have a partner in compromise.
So I think it is simply a call on Americans of all political persuasion to ask their members, their elected representatives, if they support compromise, to do it.
Q Well, why use the campaign account to do that?
MR. CARNEY: Everybody has got a stake here, Mike. This is not a political game. The American economy hangs in the balance, okay? We need to take action so that the United States of America does not default for the first time in its history. This is deadly serious and we need everyone to recognize that the only way to do this is through compromise. It is not for one part of one house of Congress to dictate to all of Washington what it, in an ideal world, would like to see happen, because that’s stalemate and we need to break the stalemate.
Q Can you explain what the President means by a “smart and balanced trigger?” And is the White House staff or the President offering specific options to members of Congress — leaders as they negotiate this? Or is he just giving those broad outlines of what he would like to see?
MR. CARNEY: We are already in conversations with lawmakers about what a compromise would look like. We believe that Senator Reid’s bill is an excellent vehicle for that. But there are — and Senator McConnell, as the President mentioned, put forward a measure that can be helpful in that. There are ways to do it.
And, as I talked about before, this issue of an enforcement mechanism is an important one. And I know that people are getting specific about different ideas. I’m not going to get into the specific ideas from here. A lot of them are pretty well known for the folks who study budgets and enforcement mechanisms.
What is not okay is to do this whole debate again by holding another extension of the debt ceiling hostage to the agenda of one faction of one house of Congress that does not have majority support and certainly doesn’t have bipartisan support. So that’s — beyond that, there are so many options.
Q But what does he mean by “balanced”?
MR. CARNEY: Balanced, I think, would be one way to look at this, as I think I addressed earlier, is that if you have a mechanism that requires action by the Congress, and if not, then there’s a trigger that has spending cuts and revenue increases that would be balanced. So it has to be — by balanced, it simply means — and it doesn’t have to involve spending cuts and revenue increases, but it has to put pressure on both sides, equal pressure on both sides.
Q And then, just quickly, given that we’re coming down to the wire and the Senate could still be voting on Tuesday, is the President — does he think that he should do the few days extension so that votes aren’t coming within hours of —
MR. CARNEY: Well, we still believe that we can get this done in time to meet the deadline of August 2nd. As I’ve said before, that if we are in a situation where we need a couple of days to finish an agreement that’s in train, we would certainly consider that.
Q So do you think we’re at that point yet or we’re not?
MR. CARNEY: No. I think we’re still at the point where we believe if the action is taken, that there is time to take it and finish this by Tuesday.
Q Jay, do you have an answer for Senator Orrin Hatch, who railed on the Senate floor yesterday about the administration not taking the American people into his confidence and letting them know in advance what programs will be funded and what won’t be funded come August 2nd?
MR. CARNEY: Well, first of all, we believe that Senator Hatch and others will in the end do the responsible thing, which is ensure that that never comes to pass.
I would point out that Senator Hatch is one of a number of Republican senators who in 2003, May of 2003 — Senators Alexander, Chambliss, Collins, Cornyn, Crapo, Enzi, Graham, Grassley, Hutchison, Inhofe, Kyl, Lugar, McCain, McConnell, Murkowski, Roberts, Shelby, Snowe, Hatch, and Sessions — I’m sorry?
Q I was doing the Senate clerk imitation — sorry.
MR. CARNEY: Okay. They all voted yes on a measure to increase the debt ceiling for 18 months, beyond the reelection campaign of the President of the United States at the time, George W. Bush. They thought it was the right thing to do for the economy. And I think that’s an important thing to remember, which is that this is not about politics, this is about the economy. That’s what we have to focus on.
Q But he wants to focus on letting the American people know are they going to get Social Security checks, disability checks —
MR. CARNEY: Mark, I understand and I refer you to Treasury. They will — it will not be today, but they will as we get closer —
Q — you may be surprised to learn.
MR. CARNEY: What I know, and what I’m sure they’re telling you, is that as we get closer to that date, they will provide more information about how they would manage that truly difficult situation.
Q It’s the Friday before Tuesday. Can you say when?
MR. CARNEY: Again, I would refer you to Treasury. Mark, thanks.
Q Can we see the contingency plans being laid out this weekend in Treasury?
MR. CARNEY: Well, I will simply say that as we get closer to that date. So there is four days before that date, so it could be this weekend. I don’t have — I’m not going to give you a date, because I’ll leave that to Treasury.
Q And also, would the President like to see more from the business community right now in terms of pressuring lawmakers to try and —
MR. CARNEY: Well, I think the President has been heartened to see how much support for the idea of compromise there is. He is — we are certainly aware of the concern in the business community that this has created, the dampening effect that the uncertainty has caused to the economy. And he is encouraged by those who have spoken out about the need to resolve this issue and ensure that we don’t have this kind of uncertainty hanging over us as we go forward; and try to do the things we need to do to build the economy, to ensure that it grows more strongly.
Q — all these outside advisory groups and some of the biggest names in the world and CEOs from big business, why aren’t they out more in front pressuring lawmakers?
MR. CARNEY: Well, again, they’re private individuals, and I’m sure that the President doesn’t need to tell them what they are seeing with their own eyes, which is the negative impact of this uncertainty, far more negative than any other alleged uncertainty created by other actions that might have been taken by this administration. This is a real problem potentially for the economy. That’s why we have to take action to resolve it.
Q You’ve got the Chamber of Commerce, the Business Roundtable, and other business groups endorsing the Boehner plan. What does that say about the effort of the White House over the last six months to win over business interests?
MR. CARNEY: Well, I think that everyone wants this to be resolved. What I do believe is that as more and more folks have focused this week on the kind of process we’re going through just to resolve this one time, the prospect of doing it again in just a few months — which essentially means that we’d be living with this uncertainty, steadily, from now until the next time — the prospect of trying to do this, as suggested by some stories I’ve read about how they’re fixing the measure or changing the measure, moving it — making it more partisan — that it would make it even more difficult and more impossible to essentially hold the American economy hostage to a two-thirds vote to amend the Constitution — amend the Constitution or default is a highly dangerous game to play.
So my answer to the question is we believe that as each day goes by and people see how unhealthy — to cite, to quote Senator Corker — how unhealthy this is for our economy, more and more people will see the need to do this for an extended period of time.
Q You’re describing why the White House opposes the Boehner plan, but my question is why has the White House been unable to persuade business groups that it’s made such an outreach to —
MR. CARNEY: I don’t have more of an answer. I think you’re hearing a lot of voices who agree that we need to extend it further.
Q Jack Lew was spotted I think outside the Capitol today. Could you describe a little bit about what he and Tim Geithner and some of the other folks are doing, specifically today, yesterday, what kind of groups they’re talking to, what they’re saying?
MR. CARNEY: Does Dan know that he was spotted outside the Capitol? (Laughter.) We are having conversations, in some cases face to face, with lawmakers about how we can move this process forward.
Q Now that — I have to ask again — we’re getting closer, and now Steny Hoyer has endorsed a 14th Amendment option, can you say that the White House has ruled out a 14th Amendment option?
MR. CARNEY: I can say this administration does not believe that the 14th Amendment gives the President the power to ignore the debt ceiling. Congress has the authorities necessary to ensure that we meet our obligations — obligations that Congress created. Important point. This is not about giving anyone a blank check to spend. It is about paying bills that have already been rung up.
Defaulting on our debt is not an option. There are no arguments that can avoid the basic truth that if we fail to act, it will have devastating consequences for our jobs and our economy.
So let me just repeat: This administration does not believe that the 14th Amendment gives the President the power to ignore the debt ceiling.
Q And also on one quick thing. Given that the GDP numbers came out today confirming that it slowed the first half of the country — first half of the year — even more than expected, will the President — would he like to see, in whatever compromises emerge — compromise — an extension of the payroll tax relief and the —
MR. CARNEY: Well, we’ve made very clear — that’s a great question, Jackie. We’ve made very — the President has made very clear that we support an extension of the payroll tax cut, a tax cut for every working American that has helped put money in their pocket, that has put money in their pocket, to deal with spikes in gasoline prices, for example, this year, and that he believes we ought to extend.
Whether that’s part of a compromise now or something we do later in the year so that we can extend it for next year is certainly something we support because it’s vital to help continue — to keep the economy growing and growing faster — you noted the GDP numbers — and creating jobs.
Q In those GDP numbers, does the President see the effect of the uncertainty —
MR. CARNEY: Well, the GDP numbers — revision of the first quarter and new second quarter — I think what I understand, and I will not go far on this because I’m not — I have not gotten my Ph.D. yet, but we do see a lot of impact from the tsunami and earthquake in Japan, a lot of negative consequences of high energy prices and things like that in those numbers.
But the important thing is we need to continue to take the measures necessary to keep our economy to grow. We absolutely do not need to do things — we must not, should not do things that cause uncertainty, that hurt our economy, reduce growth and reduce job creation. And monkeying around with the full faith and credit of the United States is exactly that.
Q Does the President see a double-dip recession coming? The Federal Reserve says in about half the cases when the GDP goes down below 2 percent for two quarters, in half those cases, the country is in recession within a year.
MR. CARNEY: We believe that the economy will continue to grow and that we will continue to create jobs. It’s obviously — we have to focus on this and keep working. We think there were some specific things that were responsible for those numbers not being as high as we’d obviously like to see them. But let me go back to the point here: What we can do to ensure that that does not happen is take appropriate action in the next four or five days.
Let me also note just in these GDP numbers, this was a far look back that included a reevaluation of fourth quarter 2008, which is now calculated to have seen a contraction in the economy of almost 9 percent. These are historic levels. I mean, we’re talking about a recession the depths of which we still are only now understanding, and also revision — revised numbers for the first quarter of 2009, when the President took office.
The calamity that befell this country in 2008 and early 2009 had a profound impact, and we were very close, potentially, if necessary measures weren’t taken, to having visited upon us a second Great Depression.
Q The President has explained why he does not support a balanced budget amendment. But if language were in the House and Senate versions passing — approving a balanced budget amendment, passing it on to the states, is that something the President would veto?
MR. CARNEY: There are a lot of — so many ifs in there, and it will stop after —
Q No, because it’s now in the House language.
MR. CARNEY: Well, I think I’ve addressed that a few times even though I wasn’t asked about it. The idea that when you’re struggling to get votes to pass a measure that we have to take action on, and instead of making it more bipartisan — because bipartisan is the only way that we’re going to create a law here and get something through the Senate — making it more partisan, and if, as you describe, attaching to it a requirement for a vote on a balanced budget amendment, I mean, this is not serious. This is dangerous.
And we do not need to amend the — you cannot have a scenario here where you tell — you say, we have to amend the Constitution or default on America’s obligations. This is not what the American people want. They want a compromise that can get the support of Republicans and Democrats, and that this President can sign. And that compromise is not that hard to achieve.
Q Jay, now that you’re trying to recalibrate a compromise in the last couple of days leading up to the deadline, could you tell us who the President is talking to, getting advice —
MR. CARNEY: April, I’ve been asked so many times —
Q Yes, but —
MR. CARNEY: — who we’ve been talking to. I’m just not going to read out conversations, okay?
Q But wait a minute. Beyond Hill lawmakers, beyond people here at the White House and beyond Warren Buffett, is the President reaching out to people like small business leaders? Has he talked to anyone? Has he picked up the phone and called people like that? Has he called average Americans just to talk?
MR. CARNEY: April, I just — I don’t have anything to give you in terms of the President private schedule, conversations he’s having. I mean, he obviously talks to a lot of people, but I don’t have any specifics for you.
Q Well, then, I mean, we just heard him just now at the event talking about — he’s playing poker now, talking to them. I mean, who is he talking to about this? Average Americans, business leaders, people who would be impacted?
MR. CARNEY: Well, as you know, again, I’m not going to get specific about phone calls or conversations he’s having. But he does, as you know, receive letters that he reads every night from Americans across the country that are carefully selected to give him a sense of what people are experiencing and feeling out there. And he’s talked about that and how important that is to him, and that continues to be the case.
Q This is going to sound exactly like what Dan and April are asking, but I promise it’s not. (Laughter.) Yesterday, Mr. Daley — yesterday afternoon, Mr. Daley on CNN —
MR. CARNEY: Different accent.
Q — said that it had been “a few days” since the President had spoken with Mr. Boehner. Is that still accurate as of this morning?
MR. CARNEY: I don’t have any updates on his conversations. Sorry.
Yes, all the way — yes, sir.
Q Thank you, Jay. Two questions. One is, is paying interest owed to the debt-holder the top priority to the government no matter the U.S. can raise the debt ceiling?
MR. CARNEY: I’ll refer you to the Treasury Department for that, and I think they will tell you that they’ll have more information about how they would manage this impossible situation if it were to come to pass. We obviously hope and believe it will not.
Q And the other question is, the President is going to meet four African Presidents this afternoon. Why now and what’s the purpose?
MR. CARNEY: Well, I think this goes to another — relates to another question that was asked about whether or not the President is able to focus on other matters. And, of course, he is able to, and he must because he’s the President and he has significant responsibilities.
Today, the President will meet with the President of Benin, the President of Guinea, President of Niger, and the President of Cote D’Ivoire. The meeting provides an opportunity to underscore the administration’s support for emerging democracies to highlight our partnerships with these countries and to discuss the building of strong democratic institutions, economic development and a range of regional issues.
Does that help?
All the way in the back, yes.
Q Yes, thank you, Jay. What is the highest level of contact that you can confirm between anyone in the administration and anyone in foreign governments who hold U.S. debt?
MR. CARNEY: The President has conversations with foreign leaders with some regularity, but I have no conversations of that nature to confirm.
Q Not the President, anyone else in the administration?
MR. CARNEY: I just don’t have any conversations to read out. I mean, when we read out conversations, we let you know. But I don’t have any to do now.
Q We heard from Valerie Jarrett yesterday the President is getting virtually no sleep. Can you tell us personally how he’s handled the past —
MR. CARNEY: Well, obviously, this is a focus and a priority of his, and it’s a matter of great concern. I think that he — I spent time with him this morning. I spent a lot of time with him yesterday. He seems very well rested and very focused and energetic.
Q Jay, what is the level of concern with monkeying around, the circus, words like “dangerous” and now adding balanced budget amendment, maybe getting some kind of deal just under the wire, that the credit agencies may go ahead and downgrade the U.S. anyway, which is one of the concerns?
MR. CARNEY: Well, I’ve addressed this, and I think that we need to focus on the things we can control. What we can control, what Congress can control is the necessity to take a vote to extend the debt ceiling to ensure that we can pay our bills, pay the bills that have been rung up already in the past, ensure that the United States does not default on its obligations for the first time in its history, and ensure that, as part of this, at the very minimum, we can embed into the law significant spending cuts that will also be positive for the economy and will send a positive signal to investors that we’re beginning to get our fiscal house in order.
It won’t be everything that we had hoped for. As you know, the President is very committed to the biggest deal possible, very committed to a grand bargain, if you will, along the lines of $3 to $4 trillion over 10 years, that would be balanced, that would really solve this problem for an extended period of time and put us on the right path. And he will remain committed to addressing that — the bigger issues, regardless of the compromise that’s reached in these next several days.
So we think that if we take the right actions in these next few days and then continue to focus on the need to grapple with entitlement reform and tax reform, and show that we are addressing those issues with real seriousness, that that will send the message that we want to send around the world about Washington getting its act together.
A lot is required to do that. But the first thing that is required is a willingness to accept that no one in this process will get 100 percent of what he wants; that we cannot keep revisiting legislation that everyone knows has no chances of getting out of Congress and getting to the President’s desk because it does not enjoy the support of both houses of Congress and members of both parties. We need to find a compromise. And if that will exists, finding it will be quite easy.
Q Thank you, Jay.
MR. CARNEY: Thanks very much, guys.
Q Week ahead?
Q Can I just follow up —
MR. CARNEY: Oh, let me just —
Q Jay, can I just quickly follow — is Treasury reaching out to the ratings agencies to sort of —
MR. CARNEY: You’ll have to talk to Treasury about that.
Let me give you a week ahead.
Q I was on hold.
MR. CARNEY: On Wednesday — I’m sorry?
Q You said she should contact Treasury. I said I was on hold. (Laughter.)
MR. CARNEY: You could walk over, it’s so close. Although it is quite warm.
Q It’s 100 degrees outside.
MR. CARNEY: On Monday and Tuesday of next week, the President will attend meetings at the White House. On Wednesday morning, the President will attend meetings at the White House. In the afternoon, he will travel to Chicago to attend two DNC events. The President will return to Washington, D.C., that evening. On Thursday and Friday, the President will attend meetings at the White House.
That is your week ahead. Thanks very much.
Q He’ll go to Chicago no matter what?
Q Seems pretty confident, then, right?
MR. CARNEY: We’re confident that this will be resolved. Obviously if it’s not, we’ll address the schedule accordingly. But as of now, we’re confident that it will be resolved. There is time to resolve this.
Q So there is a contingency plan?
MR. CARNEY: April, you know that we’ve adjusted our schedule throughout this process as necessary. But we believe Congress will act, do the responsible thing, pass bipartisan legislation that gets to the President’s desk and is signed into law so that we can lift this cloud that’s hanging over our economy.
Thank you very much.
1:39 P.M. EDT