En Route St. Paul, Minnesota–(ENEWSPF)–February 26, 2014 – 12:30 P.M. EST
MR. EARNEST: Good afternoon, everybody, and welcome aboard Air Force One. I have two pieces of good news to share with you. The first is I checked my iPhone right before we took off and the wind chill has risen to -17 in St. Paul, so we’ve chosen an excellent day to travel to Minnesota. The second piece of even better news is I’m joined this afternoon by the Secretary of Transportation, Anthony Foxx, who can talk to you a little bit about the announcement that the President is going to make today. And he can take any questions you may have about that announcement, and then if you’ll reserve questions on other topics, we’ll do that after he’s had a chance to talk to you.
SECRETARY FOXX: Thank you. It’s great to be here today. And we at the U.S. Department of Transportation are delighted that the President is going to be talking today about two big ideas. Number one is in this year of action, rolling out the sixth round of TIGER. This year it will be a $600 million program, but over the life of TIGER we have had 270 projects that have received TIGER grants in all 50 states around the country.
These projects largely are innovative, they’re job-creating, and they’re transformative for the communities in which they occur. And we are delighted that the work of a bipartisan group in Congress has given us the ability to have a sixth round of this program, which will transform communities all across America.
The second big point the President is making today is that he is outlining a framework to address the challenges with the Highway Trust Fund and moving this country forward above just baseline thinking into how we build infrastructure in the future and actually addressing the tremendous needs that are out there in this country.
The framework is $302 billion over four years, which enables us not only to fill the gap in the Highway Trust Fund but to do substantially more than that — $90 billion of additional investment in infrastructure that will help us do all kinds of great things for this country, including roads, highways, transit as well as rail.
And we are excited to be leaning into this conversation. I might point out the extraordinary work that is being done by a bipartisan group of leaders in Congress, including Senator Boxer, Senator Vitter, Congressman Shuster, the chair of the House T and I Committee, and its ranking member, Nick Rahall. They’re talking about trying to get something done so we can stave off what is a cliff that’s coming in transportation. By August or September of this year, the Highway Trust Fund will reach into insolvency. There are some structural problems with the funding in the Highway Trust Fund because it’s gas tax dependent and we’re seeing less revenue spin off there. And they’re trying to weigh into this.
But I think this is really a great moment for the country to see the President establish a framework that gives us a seat at the table in a way to engage in this conversation over the next few months.
Q Senator Boxer said this morning that she likes the President’s idea — or framework, as you called it — but that she doesn’t have a hope of passing Congress. I guess what’s your sense of how much likelihood there is of it moving forward — the President’s plan? And why propose a plan when it’s clear that it’s not going to move?
SECRETARY FOXX: Well, first of all, the certainty here is that we have a transportation cliff that’s coming in August or September. And one could posit any type of solution here and there will be voices that say that one thing or another can’t get done. I think the most important thing is that the ideas need to be put on the table.
Representative Camp, the chair of the House Ways and Means Committee, is putting his reform proposal on the table. We want the ideas to be put on the table. Everyone needs to put their cards on the table and try to see how to solve this, because the one thing nobody wants to do is to see the Highway Trust Fund go insolvent because that will be a very bad day and a very bad year for states and communities where gridlock can literally find its way to Main Street.
Q On the Camp proposal, have you discussed it with him and —
SECRETARY FOXX: I haven’t seen it.
Q You haven’t?
SECRETARY FOXX: No.
Q Speaker Boehner said this morning that he would — he didn’t think that another bailout of the Highway Trust Fund would have support in the House. What would the administration do if it comes to a bailout, if legislation doesn’t get passed before August or September?
SECRETARY FOXX: Well, first of all, we’re going to do everything we can to engage with Congress on this important question. And I think today’s announcement is a very good demonstration of that by putting our ideas on the table.
If we get to a point where the Highway Trust Fund is going over the cliff it’s going to mean slowing down payments to states; by the middle part of the summer, the states will have to start locking in contractors and there will be folks who may not get work as a result of it and we may see projects not getting done. And there are 700,000 jobs that are at risk if we don’t figure this out and — or if it doesn’t get figured out. We’re going to keep working to try to help.
Q But given the deep investment that most members have in this issue, how likely do you think it is that the United States would go over the cliff? Or how optimistic are you that, one way or another, this is going to be solved, given the bipartisan imperative?
SECRETARY FOXX: We’re always optimistic. And as I say, no one has an interest in seeing us go off that cliff. But what we’re trying to do today, I think what the President is trying to do here is to get us past Band-Aids and to get us thinking about multiyear solutions, solutions that can stabilize the Housing [sic] Trust Fund over a period of years, and help us do more to get the infrastructure we need to grow jobs and to create the platform for growth in this country for a long time.
Q Blue-ribbon tax panels have said the way to address this long term is to raise gas taxes. Is that something that’s off the table as far as this administration is concerned?
SECRETARY FOXX: To an earlier point, that issue has been raised. Chairman Shuster has said that that doesn’t have a possibility of happening. So I think we’re at a point right now where the ideas need to get put on the table, the dialogue needs to occur. Part of getting back to regular order is having the conversations about important issues like this and staving off a cliff dive that would imperil the transportation and infrastructure of this country.
Q You spoke of business tax reform for the additional spending. Can you give a little detail on what specifically you want to see reformed and how much money those reforms would bring?
SECRETARY FOXX: Well, look, there are many different ways to get there. What I know is, is that we could generate about $150 billion, part of which could be used to replenish the Highway Trust Fund, the other part of which could be used to develop new and innovative infrastructure in this country.
We feel like — and you’ve seen some of the specifics in the proposal — but the types of things we can do are things like competitive programs similar to TIGER that reward innovation and process efficiency at the state level so that we are getting more projects done for the same amount of money. Those are the types of things that we would like to see happen in transportation, in many ways reforming the way transportation is built so that we can get more bang for the buck.
Q And, Mr. Secretary, obviously Speaker Boehner and the President discussed this issue yesterday. Can you shed any light on how that conversation might be moving the issue forward?
SECRETARY FOXX: I think Jay Carney said it right yesterday. I think the conversation about this was good and constructive. And obviously there are a lot of steps along the way, but the first step is getting a strong proposal on the table, and that’s what I would consider our proposal.
Q I’m just wondering if you could step back for a second and give us your take — characterize the state of transportation and infrastructure in America. How dire is it to get things fixed?
SECRETARY FOXX: Well, it is dire in the following sense: For years we’ve been fighting ourselves to just get the Highway Trust Fund replenished, and while we’ve been fighting that battle, projects have been slow; communities haven’t even put projects on the books. And, in fact, there’s one small community in Texas that actually seriously entertained digging up roads as opposed to paying the cost to maintain them — in America. That’s not who we are as a country. And, in fact, that’s not how we’re going to be competitive going forward.
And I think what we’re doing today is stretching the thinking about infrastructure. It’s going past Band-Aids and short-term measures into strategies that give us multi-years of stable funding so that communities can plan. One of the invisible problems with the way we’ve done things — the way things have been done in Washington over the last several years is that communities really haven’t had the ability to plan. They haven’t known what tomorrow is going to look like or whether the fund is going to be there, so they’ve just stopped planning projects. That is an invisible part of what’s driving the cost of infrastructure up in this country — because if the projects get done this year, they’re cheaper if they get done 10 years from now.
So we think a multiyear solution is necessary to stop the chilling effect of short-term measures and to get this country on a more stable and certain path when it comes to infrastructure investments.
Q Can you speak to how infrastructure fits in with President Obama’s larger opportunity agenda? Are there ways in which bolstering infrastructure and transportation intersect with helping the middle class?
SECRETARY FOXX: Yesterday, the President rolled out some efforts on advanced manufacturing in additional centers. If you think about it — the more we produce, the more we’re going to need to move into position to go into not only U.S. markets, but in the global markets. So whether it’s our highway system, our rail system, our aviation system for that matter, we must have 21st century technology and investments in order to ensure that we can move goods efficiently and effectively across the globe.
As we do that, we make an even stronger case for the U.S. to bring manufacturing jobs back into this country and to have products that are stamped, “Made in the USA.” And no one is helped more by that than America’s middle class.
Q We’re going to Minneapolis. Why are you doing this in Minneapolis?
SECRETARY FOXX: Well, this is an example — we’re going to see an example of our TIGER program. The Union Depot in St. Paul is a project that was — one that the community had been wanting to get done for a long time, and the wherewithal just hadn’t come together. The TIGER program enabled St. Paul to get out of some of the traditional funding boxes that transportation has, and to put a package together that was very innovative. And you’re going to see not only does the station look tremendous, but what it’s been able to do in terms of catalyzing the area around the station is equally impressive. The connectivity that it allows a regional transportation system to create is pretty incredible. And it’s an example.
But we could have been at the Port of Los Angeles, where we are putting rail right up to the dock, which is going to save days off the time to put freight to and from ships that are coming from and going to all parts of the world. We could have been in North Carolina, where I’m from, on the Yadkin River Bridge, which had been the worst bridge in North Carolina for years. The TIGER program put the last money in to build a new bridge, and it carries a substantial amount of freight along the Eastern Seaboard.
So the TIGER program — over 270 projects, all over 50 states around this country — has had a tremendous outsized impact on building infrastructure in this country.
Q And what percentage of those TIGER grants that have already come out came from the stimulus bill? Because the vast majority — in other words, is it hard to get extra money given that so much of it came from that infusion that came through that?
SECRETARY FOXX: Well, we’ve had a few rounds since the stimulus, but the stimulus was by far the largest single block of TIGER money that went out. We’ll get you the statistics on it, but let me give you a few other round numbers. Out of the life of TIGER, we’ve had 5,300 applications and only 270 projects. By my count, that’s out of every 100 projects that applied, five of them got funded. They requested a total of $115 billion of which $3.5 billion have been funded. So out of every $100 requested $3 have been provided.
So the program is oversubscribed. It’s incredibly popular. It’s doing great work on the ground, and I believe that’s why Congress has reaffirmed it by keeping the program in place. And we’re going to have a year of action this year in which communities all across the country begin applying for this very popular program.
MR. EARNEST: Is there anything else anybody would like to talk about today?
Q Can you give a response to reports that Russia is staging forced-readiness drills along the Ukraine border?
MR. EARNEST: I do have a statement on this. The United States strongly supports Ukrainian leaders’ ongoing work to form an inclusive, multiparty government to represent all the people of Ukraine as they prepare for May elections, and to restore order, stability and unity to the country. As the process moves forward, the United States calls on all parties in Ukraine and in the region to support reconciliation and the country’s return to political and economic health.
We will work with the international community in building an economic assistance package based upon Ukraine’s achievements in crafting a unity government. An inclusive, broad-based government committed to reconciliation and economic reform is the necessary foundation for international assistance. We call on Ukraine’s leaders to do their utmost to protect the security and human rights of all their citizens, including the rights of minorities, and to recommit to honor the states’ international obligations in this interim period.
This is the part that you asked me about: We urge outside actors in the region to respect Ukraine’s sovereignty and territorial integrity, end provocative rhetoric and actions, support democratically established transitional governing structures, and use their influence in support of unity, peace and an inclusive path forward. We remind all governments of their political commitments to transparency about military activities under the Vienna Document 2011, and other OSCE obligations designed to ensure security and peace in the Euro-Atlantic region.
The United States stands with the Ukrainian people at this remarkable moment, and we will do all we can to help them build the strong, sovereign and democratic country they so richly deserve.
Q So is Russia being transparent enough in terms of what it’s doing?
MR. EARNEST: Well, I’ll say — I can confirm that we’re aware of the reports that we’ve seen about some of Russia’s military activities. And as I pointed out in the statement, it’s important for all of the parties in the region, both the Ukrainian government as well as the Russians, to understand that it is important for them to live up to the obligations of the documents that I cited.
Q Does the White House agree with General Dempsey’s timeline? He said that he needed to know by June whether troops needed to come out of Afghanistan and have a postwar plan. Does the White House agree with that?
MR. EARNEST: Well, I’m not in a position to set a specific deadline from here. But suffice it to say that the farther that we go without having a signed bilateral security agreement, the more that our military planners will have to curtail the scope and ambition of any post-2014 mission.
Now, at the same time, the planners are factoring in as much flexibility as possible into this process that would allow for the United States and our partners around the world who are involved in this mission to make nimble decisions based on the kind of partnership we can expect with the Afghan government.
So the bilateral security agreement that has been agreed to both by the Afghan government, it’s been endorsed by the loya Jirga, the President and this administration believes it’s in the interest of the United States, is a good and functional agreement. But we need to get the final signoff from the Afghan government in order to make the kinds of plans for what our mission would look like after 2014.
But we’re trying to be as flexible as possible. That’s factored into the process. But there’s no denying that the longer this is delayed, the further the scope and ambition of any post-2014 mission is restrained.
Q — can’t say a June deadline then?
MR. EARNEST: I would not establish a specific deadline from here other than to reiterate the dynamic that we think is in place as the Afghans — and as President Karzai, in this case — drag their feet in signing this BSA.
Q Going back to infrastructure, Secretary Foxx didn’t really elaborate on what business tax reform means in this case. Can you help out? I mean, business tax reform could be anything. What exactly will get this money into the Highway Trust Fund?
MR. EARNEST: Well, the President has talked quite a bit about his principles when it comes to business tax reform — that there is a way for us to lower tax rates for American businesses, broaden the base in a way that will make American businesses more competitive. That ultimately should be the goal, would be a set of policies, including tax policies, that are in the best interest of the American economy, American businesses and American workers.
Now, part of that should also include closing the kinds of loopholes that have riddled the business tax code that don’t contribute to economic growth and don’t create jobs; that there is significant revenue that can be gained by closing some of those loopholes. It’s the President’s view that some of that revenue can be used to invest in infrastructure projects that do strengthen our economy, that do create jobs over the short term and will contribute to economic growth over the long term. It’s a pretty common-sense operating principle that the President — or at least we’re hopeful that would earn some bipartisan support.
Q Can you give an example or two of particular loopholes?
MR. EARNEST: Well, there have been loopholes that are related to tax policies that are an incentive for companies to ship jobs overseas. The President believes that we should reorient that tax policy, close those loopholes that offer that incentive to ship jobs and commerce overseas, and actually put in place some tax policies that would provide an incentive for companies in the United States and companies around the world to invest in the U.S.
So that’s one example. There are other examples related to other aspects of the tax code like carried interest that have long been sort of part of the kinds of proposals that we’ve put forward.
Q Will the President introduce the infrastructure bank again this year, do you know? Is that going to be part of the budget?
MR. EARNEST: I don’t have anything to preview in terms of the budget for you quite yet.
Q Just to jump back to the Israeli air strikes in Lebanon, do you have any response to that? And can you preview at all what the President might talk to Netanyahu about next week?
MR. EARNEST: I have seen the reports of that activity, but I’m not in a position to confirm those reports, so I’d refer you to the Israeli government to see if they have any comment on them.
In terms of the President’s meeting next week with Prime Minister Netanyahu, as you’ll recall from previous briefings and gaggles, we’ve often pointed out that the President has met — has had as many conversations with Prime Minister Netanyahu over his five-plus years in office as he has with any other world leader. That is an indication of the strong relationship between the United States and Israel. It’s an indication of this country’s commitment to Israel’s security. It’s an indication of how much of a priority it is for the President and for the rest of his administration to ensure that we’re working closely and coordinating with Prime Minister Netanyahu and the Israeli government as we confront the variety of challenges that pose a threat to some instability in the Middle East.
In terms of specific aspects of the conversation I’m not in a position to preview you them right now, but there’s no doubt that the conversation that they’ll be having on Monday is an important one and the next in the series of important conversations they’ve had over the years.
Q On the domestic front, Alison Lundergan Grimes campaigned with former President Clinton yesterday and spoke glowingly about Clinton’s time in office, didn’t mention the President, and, in fact, talked about how both parties were to blame for the paralysis we’ve had in Washington. Is there anything you can say about how the White House views those kinds of comments and what they say about how people will be campaigning this year?
MR. EARNEST: Well, I think the President himself has articulated his own frustration with Washington and how too often partisan backbiting and the influence of special interests has blocked progress in Washington. That’s been particularly true among Republicans in Congress. And I think that’s why you’ve seen the President be pretty candid about his desire to work with Congress where he can but not allow that dysfunction to block his efforts to make progress.
So some of the aspects of what the President will be talking about today are evidence of the President’s not just his desire, but his commitment to move forward on all fronts — particularly on policies that are going to strengthen the economy, that are going to expand economic opportunity, that are going to be good for the middle class. So that is the focal point of the President’s domestic policymaking agenda.
In terms of Democratic candidates across the country, I think there’s a lot that the President is advocating for that Democratic candidates can get behind. I mean, frankly, there’s quite a bit the President talks about that Republican candidates can probably get behind if they wanted to. But we’ll have to see if they choose to do that or not.
Q On the enrollment numbers that came out yesterday, they said 4 million people had signed up for health care plans. Does the administration have any better handle now on how many people — how many of those people have paid for their plans?
MR. EARNEST: Kevin, as you point out, the administration is doing our best to try to provide as much data on an ongoing basis about the pace of signups onto the Affordable Care Act. As you know, the Affordable Care Act is a reform of our private health insurance system and that is an indication that when people are signing up for health insurance they’re signing up for private health insurance, and that those payments that are made by these new customers are directed to and sent to the private insurance companies themselves. So more information about who exactly — questions about who exactly has paid for the health insurance can best be directed to those private insurance companies that are collecting those payments.
There is some insight that we can offer that’s not as exact that we’re working to collect, so we may be in a position — I don’t want to make any promises from here — but we may be in a position down the line to try to provide some greater insight into that. But the fact of the matter is these payments are being made to private insurance companies, so data about what the rate of payment is can be directed to those insurance companies that are responsible for collecting those payments.
Q How far down the line do you think that would be?
MR. EARNEST: I don’t know. We’ll have to see.
Q Do you know or do you have any more information about how many people under 35 have enrolled? I know that we had numbers when we heard the 3.3 million, but now that we have 4 million, if you have any information on that?
MR. EARNEST: I don’t have any information — updated information on that, standing here. But I do anticipate that we’ll have more updated information on that in the future. The trend that we’ve been seeing for some time is a slow and steady ramp-up of young adults signing up. There’s a significant increase in the rate of young adult signups in January that even outpace the overall increase in the rate of people signing up in January. That’s a good indication. It also is consistent with the experience of the Commonwealth of Massachusetts that over their enrollment period, that most of the young adults who eventually enrolled in the program did so in the last few months of that enrollment period.
So we would anticipate in the remaining weeks of this enrollment period that we would see a continued increase in the number of young adults who sign up for health insurance under the Affordable Care Act.
Q When we were getting on the plane, there were reports from Syrian media that 175 opposition fighters had been killed in an attack, conceivably from the Assad regime. I was wondering if you could confirm any details about that or if the White House had any reaction on that.
MR. EARNEST: I have seen those reports, but I’m not in a position to confirm them. Over the last several years, we’ve many times talked about how tragic the violence is in Syria and that too many people have lost their lives as a result of that violence. It remains the steadfast view of this administration that continued violence will not resolve the disputes that have been so painfully laid bare in Syria and, ultimately, this resolution will require diplomatic talks and a political transition. And that is a rather painstaking effort that we’ve been engaged in for some time. But our commitment to obtaining that goal continues unabated.
Q And on the law in Arizona that’s under consideration, has the President developed a stance on whether Governor Brewer should veto that bill?
MR. EARNEST: I don’t have anything to say about that beyond what Jay said about that yesterday. We don’t weigh in on all these individual pieces of legislation that pass through state legislatures across the country. Based on the reports that I’ve seen — I’m not an attorney and haven’t analyzed the legislation — based on the reports it’s clear that this piece of legislation doesn’t seem to be in line with the President’s commitment to equality and justice and fairness of all people, regardless of the color of their skin, their last name or who they love.
Q The President was pretty outspoken about that law in Uganda even before it was signed into law. Is there a reason he was so outspoken on a law that would ban homosexuality in Uganda, but he doesn’t have an official stance on a law here in the United States?
MR. EARNEST: Again, I think that the statement that the President made on the bill that was signed into law in Uganda is consistent with the view that the President has publicly pronounced and strongly advocated in a variety of settings across the country. So our position on this is pretty consistent and has been as we’ve taken questions on a variety of things — everything from Arizona to Uganda, if you will.
Well, I was just going to say that somebody did ask — Nedra, I think you asked Secretary Foxx about the proposal release by Camp. And so, if you’d like, I can offer a couple of things here.
The fact that Congressman Camp has put forward a proposal is a positive development. The President has long advocated, as I mentioned earlier, business tax reform that is pro-growth, that simplifies the tax code and makes it more fair. The President has talked about what some of those principles should be — closing loopholes and using some of that money for infrastructure; that we can also lower rates, broaden the base; that there are a lot of benefits that can be derived from a smart, pro-growth business tax reform.
Now, there are a couple of aspects of Congressman Camp’s proposal that are encouraging. The first is Congressman Camp does propose to close some of the loopholes that I mentioned earlier that the President has long advocated closing. These are loopholes like the corporate jet tax loophole and the carried interest tax loophole, and a series of other unfair tax loopholes that don’t contribute to long-term economic growth. So the President believes that we can close those loopholes and make our tax code a little bit more fair. And we’re pleased to see that Congressman Camp’s proposal includes closing some of those loopholes.
I’d also note that apparently Congressman Camp has embraced another concept that the President has put forward, which is using some of the revenue from corporate tax reform to invest in infrastructure. Again, this would create jobs in the short term, but also lay a foundation for our long-term economic strength.
So there are a couple of reasons to be optimistic about it. But, of course, there are some aspects of this proposal that we do not agree with. The first is that there does not appear to be any money or any revenue raised from this corporate tax proposal that would go to reducing the deficit. That is something that is of concern to the administration. That’s something the President has long said that we should do; that this would be in line with a balanced-approach deficit reduction. The second thing is that, more troublingly, Congressman Camp’s proposal appears to actually add to the long-run deficit.
Q Appears to actually add?
MR. EARNEST: Add to the long-run deficit. So that’s a source of some concern.
The last thing, and in some ways this is the most important, the President believes that our tax code should reward hard work. And one way that we can reward hard work is to extend and expand the earned income tax credit. The earned income tax credit goes to working people, and the President believes that further tax breaks for working people is a good way to strengthen our economy, expand economic opportunity, and make sure that hard work is rewarded in this country.
Unfortunately, Congressman Camp’s proposal does not include extending the earned income tax credit and, quite frankly, this does not seem like a very good time to be raising taxes on working people in this country. And that’s another aspect of Congressman Camp’s proposal that we do not agree with.
But let me end where I began, which is to say that we welcome the constructive, specific proposal that Congressman Camp has laid forward. I understand that he’s presented it as a discussion draft. And this administration will certainly take part in discussions with members of Congress in either party who want to put forward constructive proposals to simplify our tax code, to make it more fair, and orient our tax code around policies that will strengthen our economy and create jobs.
Q And how optimistic is the White House that those discussions will lead to actual reforms this year ahead of the election?
MR. EARNEST: Well, there’s not a great amount of optimism on Capitol Hill for any kind of legislative proposal that seems complicated. There is no doubt that, by any definition, reforming the tax code, particularly the business tax code, is complicated. So that’s not going to preclude the President and members of his administration from engaging in conversations with members of Congress in either party that seems interested in having those conversations. But I think it’s fair to say that we are realistic about the prospects for difficult pieces of legislation like this passing this Congress this year.
Q One last thing. Is the White House watching this bitcoin exchange issue and does the White House have any comment on it?
MR. EARNEST: I’ll confess that I have read those headlines, but I’m not prepared at this point to offer a specific reaction. But if you want to direct your question to somebody back at the White House, we may be able to rustle up an answer for you.
Okay? All right? Thanks, everybody.
1:06 P.M. EST