Press Briefing by Press Secretary Robert Gibbs, 12/9/2010

1:48 P.M. EST

MR. GIBBS:  Mr. Kuhnhenn, take us away.

Q    Thank you, Robert.  We had a little House Democratic action today, and in the wake of that, the Speaker said that the tax plan would not come to the floor unless it was “improved,” her word.  And I’m wondering, what does the President think of that kind of repudiation from the Democrats?  And what can you possibly do to the tax plan to make it more appealing to Democrats?  Can you just tweak it around the edges, things like energy tax credits and so on, or can you actually go after the estate tax and make any adjustments to that that would appeal to them?

MR. GIBBS:  Well, let me just say, first and foremost, as you’ve heard the President over the past several days, he understands that there are parts of the agreement that Democrats don’t like.  He’s certainly one of them.  Whether it’s the upper-income tax rate changes, whether it’s the additional changes to the estate tax, there are certainly parts of this that I’ve read that Republicans don’t like.  So that, by the nature of it, is compromise.

If there are ways to strengthen the framework that are agreeable to everybody and strengthen the coalition, that’s good.  I think that’s something that we’d have to hear — I think that’s something that House Democrats are going to have to talk about in terms of what they want to do and what they want to see.  

I mean, obviously, as I said yesterday in response to several questions, if everybody took out what they didn’t like, we wouldn’t — we would have nothing.  And we know the consequences of doing nothing, and that’s why I strongly believe and the White House strongly believes that at the end of the day, Congress will give the American people a vote on a plan that prevents their taxes from going up by several thousand dollars at the beginning of the year; that will prevent millions from losing their unemployment insurance; and as this agreement does, the framework of this agreement, give strong incentives for job creation and economic growth.

Q    Is the estate tax, for instance — which is the one thing that they have — seem to be zeroing in on — is that essentially off the table as a –

MR. GIBBS:  Well, again, Jim, I think that — I think that — again, that’s something the President is no big fan of.  I guess the question for them to work through with some of their Republican counterparts is if you do that, do you lose votes on the other side.

So this is a — this is a game of calculus and physics, and I think the bottom line, though, is that we will have a vote that will not result in people’s taxes going up by the end of the year.

Q    Can I follow up on that?

MR. GIBBS:  Sure.

Q    Erskine Bowles yesterday complained that the plan didn’t have any provisions for midterm or long-term deficit reduction.  And given how expensive it is, should that have been something — is that fair criticism?

MR. GIBBS:  Well, let me say a few things.  One, if I’m not mistaken, the commission had a payroll tax cut in their proposal.  Two, this is not a long-term — this is not a — by definition, a long-term plan.  This is an agreement to — basically tax policy for the next two years.  

Jack Lew and Secretary Geithner met at the White House this morning with members of the fiscal commission to go through and discuss with them their report and to talk with them as we begin to broach and work through the decisions that we have for our budget for next year.  But I think that we’re going to, over the next year and several years, have to have a discussion about getting our fiscal house in order.  That’s why the President appointed the commission to begin with and I think we’re looking through their proposals as we put our budget together to see what matches up and we could send to Capitol Hill early next year.

But I think it would be wrong to look at the agreement that the President laid down as either a long-term tax or a long-term budget agreement.

Yes, sir.

Q    Robert, is the White House concerned about the reaction in bond markets, by the reaction that mortgage rates are going up as a result of this deal?

MR. GIBBS:  I would you point you to somebody at Treasury.  I only get in trouble when I talk about things like that.

Q    Even the mortgage rates bit?  I mean, the idea is you would like to help Americans, you would like to spur the economy with this deal, but one of the unintended consequences is mortgage rates going up.

MR. GIBBS:  Jeff, I will have 15 emails that have gotten me in trouble if I dip my toe into this swirling Rubicon, and I’m not going to.  

Q    All right, let me try something else then.  We’ve seen cost estimates ranging from $700 billion to $1 trillion for this deal.  And Larry Summers talked about some of the cost estimates, particular aspects of it yesterday.  Does the White House have an overall price tag?

MR. GIBBS:  Well, again — and I should mention this when I was talking about Jim’s answer — within the extenders portion of the agreement, there are still some details to be worked through, and staff has been doing that over the past couple of days — at what level, at what rate, the specifics of some those extenders.

So it’s hard to know the exact cost of the bill, as Larry said yesterday, and they’ll do an estimate on that as this goes through the legislative process.  

I have seen various estimates.  I think somewhere in the mid-seven — upper-700s to upper-800s is probably about the right venue.  I think more than a third of that — or about a third of that would be tax cuts for the middle class.  The next biggest expenditure, I believe, in the composition of the total is the payroll tax cut.  

So those comprise the largest elements, percentage-wise, in the package.

Q    Can you give us — last question –

Q    I thought you said the payroll tax cut was paid for.

MR. GIBBS:  No.  When did I say that?

Q    The other day when we were talking about –

MR. GIBBS:  No, this is — no, this is — I don’t believe I said that.  

Q    I was just going to ask one last follow-up on the Lew meeting — the Lew and Geithner meeting.  Can you tell us any more about what particular issues they discussed and what the reaction is from –

MR. GIBBS:  Well, again, Jack and his team are in the midst of putting together a budget.  There are meetings — there have been meetings on that this week, and later in the day, on decisions that have to be made around that.

I think one of the — obviously, not simply talking through just the specifics of what they talked about, but I think also you can get a sense from discussing with the commission members sort of the different types of coalitions that you might be able to put together to get some of this through law — through Congress and into law, because there’s a — certainly the panel is made up of members of Congress and this all has to get through them as well.

Jake.  

Q    If Speaker Pelosi is actually talking about not even introducing this bill for a vote, aren’t you worried that this isn’t going to happen and all the economic catastrophe that you guys are warning about is going to happen?

MR. GIBBS:  I think at the end of the day, this will get done.

Q    So you think she’s bluffing?

MR. GIBBS:  I think that this is a long and winding process.  But I think at the end of the day, members are not going to want to be in their districts, senators are not going to want to be in their districts when their constituents find out on the 1st of January that their taxes have gone up by several thousand dollars.  

And I continue to believe that when all is said and done, if we don’t get something done this year, everyone will I think rightly be blamed for not having gotten something done and we’ll find ourselves, quite frankly, in a position where we’re not getting the politics out of unemployment insurance for the rest of the year; a payroll tax that, I think safe to say, most economists, probably almost every economist that doesn’t work inside here, didn’t think was even in the offing.  And I think that’s the basis for — the basis for the economic projections that we’ve seen increased.

Q    Considering — we’ve heard the President and other senior advisors on the record — and then others off the record or on background — express frustration or hint at frustration with Congress, with Democratic leaders.  President Obama pointed out the other day that he wanted a vote on this before the midterms, and obviously, the Democratic leaders didn’t deliver.  David Axelrod yesterday pointed out that the House couldn’t even pass seven months’ worth of unemployment insurance extensions; this compromise would have 13 months.  How personally frustrated is President Obama with the Democratic leaders in Congress, considering how difficult they’re making this process for him in a deal that he feels is ultimately the only thing he could have gotten?

MR. GIBBS:  Well, look, I think the President is — and the Vice President has certainly been up on Capitol Hill.  I think the Vice President was pleased, even after the caucus last night, that members came up to him — he told me this — members came up to him agreeing that this was a good agreement.  But –

Q    Then they voted not to support it?

MR. GIBBS:  Well, I think it was a voice vote, and my guess is if a lot of voices yell one thing you may not yell the other.  But I think that — look, I don’t think we spend a lot of time here thinking about what could have been in September or in October or things like that.  The President is focused on an agreement that he thinks provides some genuine economic growth and job creation potential and to ensure that taxes don’t go up — even as we understand rightly the frustration of those that this agreement includes stuff that the President has campaigned against, the President has fought against, the President has said over and over again that he opposes.  It is that part that makes it compromise.

And, again, I think in the end of the day the President is — believes that this agreement, the framework we have, will be the basis for what prevents middle-class tax rates from going up on the 1st of January.  

Q    Let me just put a button on this.  Have Speaker Pelosi or Leader Reid offered an alternative deal that could get through the Senate?

MR. GIBBS:  Not that I’m aware of.  But I would direct you to them.  Not that I have heard, no.

Q    Can I go back on the estate tax?  There are a lot of prominent Democrats, including Congressman Clyburn, who really saw this as pouring salt on their wounds, that this was something that took them by surprise and was an unnecessary gift to the rich, in their perspective.  Is the President not willing at all to amend his position on that, perhaps take the estate tax back to the 2009 level that many Democrats –

MR. GIBBS:  What was the 2009 — I don’t –

Q    Forty-five percent with a $3.5 million –

MR. GIBBS:  Three point five –

Q    Three point five percent — $3.5 million at 45 percent

MR. GIBBS:  Which — that’s a $46 billion two-year price tag, as I understand it.  

Look, do I — does the President wish we had to add $12 billion each year for two years to go to the different level?  No, as you heard him say.  

That was and has been the negotiating position of the Republican Party since the very beginning, including the meeting that was held in the Roosevelt Room.  That’s what they offered as their — that was their position on the estate tax.

Again, there are parts in this we don’t like.  There’s parts in this I’m sure Republicans don’t like.  The reason why you couldn’t get an extension of unemployment insurance through the House wasn’t because most Democrats don’t think that you should extend unemployment insurance.  It’s because Republicans didn’t believe you should.

And so there’s — again, there’s things in here that none of us find — or not all of us find attractive.  But in order to get something that a majority can agree on, I think the basis and the framework for that is encompassed in this agreement.

Q    There are several Democratic lawmakers who did not agree — did not feel that this meeting with the Vice President went well, and they believed that the administration –

MR. GIBBS:  Again, compromise.  (Laughter.)

Q    Well, they believed that the administration presented it as a take-it-or-leave-it deal.  Are you saying that the President is presenting this as a take-it-or-leave-it kind of deal?

MR. GIBBS:  Again, I said yesterday and I said earlier to Jim’s question, and that is if there are ways that this agreement can be strengthened, that everybody signs — everybody believes in — but understand, again, if one side takes out what they don’t like and the other side takes out what they don’t like, we’re going to have that.  And that, a blank piece of paper, is not going to prevent middle-class tax rates from going up.  It’s not going to prevent  — it’s not going to prevent the politics that’s going to get played every three months for all of 2011, with extending unemployment insurance, even to the tune of watching the benefits of 2 million people expire before Christmas, before the end of the year.  

Again, a perfect deal?  Not by any means.  Are there things in it the President doesn’t support or doesn’t like?  Some of them in here are things I’ve heard him be opposed to for as long as I have been with him, and that goes back to April of 2004.  But the nature of compromise is taking enough things to get an agreement through.  And I think in the end we will.  

Q    Does the President need to go to the Hill to make his case personally?

MR. GIBBS:  Again, the President — the President has been making his case, and the President will continue to.

Q    I have another dead horse to beat.  (Laughter.)

Q    Be careful.

Q    Sorry.

Q    Don’t preface the question.

MR. GIBBS:  You have to admit, it was pretty good.  (Laughter.)

Q    The surgeon general this morning told one of our correspondents when asked about the President’s smoking habits, “He is working very hard to stop.  He has been working very hard at it.”  So my question is, how hard has he been working at it?  What’s he doing?

MR. GIBBS:  I have not seen or witnessed evidence of any smoking in probably nine months.  

Q    Do you know that he’s working at it?  Has he talked to you about it?

MR. GIBBS:  He has.

Q    What’s he saying?

MR. GIBBS:  Look, this is — this is not — I mean, I think you’ve heard him say this — this is not something that he’s proud of.  He knows that it’s not good for him.  He knows that it’s — he doesn’t like it — he doesn’t like children to know about it, obviously, including his.  And I think he has worked extremely hard.  And I think he would tell you, even when in the midst of a tax agreement and a START deal and all the other things that accumulate, that even where he might have once found some comfort in that, he’s pushed it away.  So he understands its dangers and I think has done a lot of extraordinary work to wrestle with that habit, as millions of Americans have.

Q    Thank you.  Now, changing horses, does the fact that the Senate may do a test vote on the tax package raise your hopes that that will force the House’s hand?

MR. GIBBS:  Well, I think it will demonstrate that there is support for this agreement in both parties.  I think you have, largely because we have barraged you with them, statements from elected officials all over the country — mayors, governors, governors-elect — from big cities, smaller cities, big states, smaller states that believe, as the President does, that we have to do several things:  ensure that taxes for the middle-class don’t go up; ensure that we get an extension of unemployment benefits; and ensures that we get some real economic bang for our buck in something like the payroll tax.

So I think it will obviously legislatively bring us one step closer to getting this agreement.  And I think, in the end, we’ll get something done.

Yes, sir.

Q    A number of op-eds today suggesting this compromise is the President’s reaction to the midterm elections.  And yet there are officials who say that some of the elements of it are things that simply wouldn’t have worked in ‘09 when the Republicans wanted the stimulus package to be predominantly tax cuts and not spending.  So, which is it?  Or is it a combination of both?

MR. GIBBS:  I don’t understand the second part of your question.

Q    The tax cuts that — Republicans wanted the ‘09 stimulus package to be mostly tax cuts, not federal spending.  

MR. GIBBS:  The truth is, I think in terms of — well, we can always quibble.  I think a decent number of — a decent number — several hundred billion dollars, probably more than a third of the bill, was tax cuts.

Q    And they wanted more.

MR. GIBBS:  Well, they didn’t want more enough to vote for it, because they all support an AMT tax relief and –

Q    They wanted more tax cuts than spending, that was their position.  The school of thought then was that the economy was in such bad shape that the tax cuts themselves wouldn’t do the job.  I don’t want to be answering your question for you.

MR. GIBBS:  I think fairly well — fairly well borne out by history, yes.

Q    So how much of this deal reflects the President looking at the midterm elections, saying, I’ve got to compromise with Republicans, and how much of it reflects the economy’s growth from ‘09 to now?

MR. GIBBS:  Well, I think — look, I think what the election brought to Washington was — and what the imminent change in our calendar brings is the notion that to get anything done by the end of the year it’s not going to be all of what anybody wants.  And we know that because we had — we’re in the position of working through an agreement because on Saturday we had two votes in the Senate that didn’t have enough to move this process along.  We’re at this because we’re at a legislative stalemate in just what — just the option that we wanted, which was to make the middle-class tax cuts permanent.  

In designing an agreement, obviously we wanted something that — we wanted something that made sense economically.  I think — and I think maybe compromise is a good word to describe, for instance, taking $60 billion in — roughly $60 billion in Make Work Pay for 2011 and 2012, putting it together in 2011 and doing it through a payroll tax cut which shares a number of the characteristics to Make Work Pay, doing it with a greater bang for your buck means the benefit to the middle class is greater for virtually every family under $106,000 or roughly $107,000.

I think it is an understanding that the only way we were going to get something done after the votes on Saturday was to work together, and in doing so, we wanted something that provided economic certainty and grew the economy.

Q    Are we looking at the calendar here or are we looking at a new President Obama?  Is this a move toward the center?

MR. GIBBS:  Do you want me to say triangulate?  (Laughter.)

Q    If you feel you’d like.

MR. GIBBS:  No, I don’t –

Q    Are we going to see the same kind of compromise in 2011?

MR. GIBBS:  Well, look, I’ll say this.  We have — if you look at what — the President took, as he talked to you all about — we took a pretty bad press day in Seoul, Korea, to walk away from an agreement that we believed wasn’t as good as we could get.  And we got something that ended up being better for our country and for our country’s workers, and because of that, put together a coalition that I think stands a better chance of getting through Congress, because Dave Camp and Sandy Levin and Ford and the United Auto Workers are supportive of that newer deal.  I think that’s a coalition that can get a trade agreement through Congress.  

I think START is going to pass by the end of this year with a pretty big bipartisan vote.  And I think in the end this will pass with a bipartisan vote as well.  And I think that is what the American people asked for in this election, and I hope it is a sign of things to come.

Q    So this compromise, this time of compromise is or is not likely to be what we’ll see over the next couple of years?

MR. GIBBS:  Well, I think the President is certainly hopeful that we can get into a room and discuss issues like adults and come out with an agreement that while we might not all like is in the best interests of the American people in this.  In this tax agreement, it’s to preserve the middle class — to preserve middle-class families from seeing a tax increase.  That’s what’s animated the President and hopefully that’s what will bring us an agreement.

Q    Robert, the six-pack group of folks that were negotiating the tax bill, they stopped meeting as a group formally I think it was the Friday before the Senate held those votes that didn’t pass.  And then you guys announced a deal.  Did you cut out the House Democrats too quickly?  Did you not bring them in on the loop?  That seems to be the common complaint among this House Democratic caucus, is that you guys didn’t loop them in on the negotiations enough.  Did you guys make a mistake?

MR. GIBBS:  I don’t — I’d have to go back and look through the scheduling of when each of these meetings was done.  Look, again, I think that the frustration of — there’s understandable frustration about what is in this agreement –

Q    But they felt uninformed.  They saw the — basically the agreement came out and they didn’t — and a lot of House Democrats felt as if they were out of the loop.

MR. GIBBS:  Well, I mean, I guess I’d push back on that a bit because we had the leaders of the House and the Senate down here a couple of times — I believe once over the weekend, maybe more than once over the weekend, and then on Monday before the President went out.

Q    They weren’t there — when you were cutting a deal with McConnell and Boehner, was Speaker Pelosi in the room?  Was Chris Van Hollen in the room?  This is part of a negotiation –

MR. GIBBS:  Again, I don’t know who was in every meeting, Chuck.  Again, we — I think the President — I think the President believes — continues to believe we got a good deal.

Q    Congressman Elijah Cummings implied today that START and the estate tax are connected in the negotiations with Senator Kyl.  What do you respond to that?

MR. GIBBS:  I think a number of us have continued to say that’s not true.

Q    What gives you the confidence that you’re getting a START vote, since we’re now less than a week before — we’re less than a week away — about a week away before the official recess?

MR. GIBBS:  I wouldn’t make — I don’t know that I’d make a ton of plans in that intervening week.  (Laughter.)  

Q    I think we’re all aware of that.  But you still have –

MR. GIBBS:  Sorry to do the — sorry to deliver coal in the occasional stocking, but I’m not –

Q    You still have Mitch McConnell’s word that you’re getting a vote?

MR. GIBBS:  I think we’re going to –

Q    Do you have his word?

MR. GIBBS:  I think we’re going to get a vote for a number of reasons, not the least of which it’s the right thing to do.  I will say — going back to Wendell’s question — when was the last thing we proposed that the last five Republican — last six Republican secretaries of state thought was a good idea that didn’t have the vast support of the American people like START does?

It’s the right thing to do for our relationship with Russia and our relationships in the world.  It’s the right thing to do to cut our deployed nuclear stockpiles.  And that’s — I think it will get done because of that.

Q    Today the Transportation Department is pulling money from Wisconsin and Ohio for light rail and redirecting this money, stimulus money, to other states.  Both Wisconsin and Ohio just elected Republican governors who ran in part on pledging not to — they didn’t want to go through that project.  Why not let them use that money for other transportation projects?

MR. GIBBS:  Because the money is written into the law to be for high-speed rail.  Both gubernatorial candidates, now both gubernatorial — or governors-elect, told us they weren’t going to spend that money as the law is written.  And as you know — and I think your network and many others have done stories on ensuring that we spend this money the right way.  And if grants that are obligated to places that aren’t going to use them as the law intends, then we will give that money to places that will use it as the law intends.

Q    Considering the pain that Wisconsin and Ohio have in their own economy, and the point of this money was to pump money into some of these states, particularly those two states, would you be open to changing the law so that money could be used for other transportation projects?

MR. GIBBS:  Let’s be clear, Chuck, that building high-speed rail would alleviate the very problems that you just described.  Now, you can ask governors-elect whether they decided not to put people in their own state to work just because Barack Obama decided that — or just because Barack Obama proposed it as a project.  My hunch is that there are people sitting around their kitchen tables in Ohio and Wisconsin who are wondering why they’re not at work because a partisan political food fight by a governor-elect.  Those people could be at work if they spent the money as it was legally intended to be spent.

Jonathan.

Q    This question about START, about whether there was a START connection, you’re treating that like some kind of nefarious thing, but it’s fairly standard procedure, especially when you’re negotiating with the Senate to try to get some kind of more universal or broad floor agreement.  When you agree on one thing, you’re going to say you’re going to have a vote on another.  Was there any effort to get anything from Mitch McConnell to assure, if not a START vote –

MR. GIBBS:  You’ve written like three stories about the — how we’re supposed to — I’m supposed to trade some of this for some of that and get some of this for some of that.  There just wasn’t — we were working on an agreement on how taxes was going to be treated over the next two years.

Q    And did you get any — try to get any assurances on Republican votes that if we do this, then the Republicans can deliver that many votes?

MR. GIBBS:  No, I was not in each of these meetings.  But, again, I think these are legislation that’s going to stand on and be approved on its merits.

Q    Finally, on “don’t ask, don’t tell,” we’ve now seen a number of Republicans in the Senate come forward in favor of it, but there’s some dispute on how that vote would take place procedurally, and I wonder what involvement the White House is having on that, resolving that, and whether you think that “don’t ask, don’t tell” could also be passed –

MR. GIBBS:  I think it can and I think, as you mentioned, Jonathan, there are a number of individual senators that have come out in support of ending an unjust policy.  As I said yesterday, the President has made calls to Democrats and Republicans on both “don’t ask, don’t tell” and the DREAM Act.  I will check with Legislative Affairs if there’s anything that’s going on, particularly to break the procedural logjam on the number of amendments.

Q    Robert, quick follow-up to your response to Bill’s question about the President smoking.  Should we take that to mean that he’s quit?  You said you haven’t seen any evidence or seen him smoking for nine months.  Has he quit?

MR. GIBBS:  For that nine months, yes.  I mean, I don’t — I’m trying not — I don’t want to be flip.  I mean, I don’t — I think the President would be the first one to tell you that it’s a struggle.

Q    So how has he done it?  How did he do it?  Is it the gum?

MR. GIBBS:  He’s stubborn — (laughter) — and has — look, this is something that he has thought about for awhile.  As I said, I think this is something that he’s aware is not something that’s in doing is in his best interest for his health.  And I think he’s thought about that for quite some time.

Q    One more on something else.  Is he going to — can we expect him to speak about or maybe even to Nobel Peace Prize winner Liu tomorrow?

MR. GIBBS:  As it relates to Liu Xiaobo, when he was awarded the Nobel Prize, the President was among the very few who put out a statement both congratulating him and calling on China to release him.  And the President — we will release a statement reiterating that tomorrow.

Q    That will be a written statement?

MR. GIBBS:  Yes.

Q    What’s the official U.S. representation at the ceremony?  What’s the decision on that?

MR. GIBBS:  I believe our ambassador will be there.

Q    What message does that send?  Some countries are boycotting it.

MR. GIBBS:  Well, no, I think we’re there in showing support for the committee’s decision.  And we were the previous recipient of that prestigious award and the President and our ambassador strongly believe that they should be in attendance of a ceremony attended by the winner, because he’s [not] been released by China.

Q    The heads of the deficit commission urged the President to call a budget summit early next year.  Will he do that?  And also, why didn’t he drop by the meeting this morning?

MR. GIBBS:  I’d have to look through the schedule and see when it was versus — I think the President may have been in the Export Council meeting when they met with Jack and Tim.  Again, we’re looking through that and deciding what makes sense to put in the budget as we construct that for next year.

Q    Do you think a summit is worth considering, a budget summit?

MR. GIBBS:  Well, look, I think we ask the commission to do a lot of important work.  We couldn’t get a law through to set up a commission.  So the President believed, through executive order, that it was important to do that through his power.  And I think the process, particularly with the budget coming, the best process right now is to analyze, discuss and meet with the commission at the level that they’re doing it and see what can be included in the budget.

Q    And also, what is the administration doing to reach out to the liberal base, who have been so critical of the compromise?

MR. GIBBS:  Well, again, I think you all have documented the Vice President’s attendance on Capitol Hill.  I think you’ve seen quite a bit of staff up there.  There are discussions in this building with members.  And I think the President has been out there campaigning quite a bit about why this is important to our economy.

Q    Are there specific administration officials who are reaching out to different liberal groups, though, behind the scenes?

MR. GIBBS:  Well, look, I think if you look at some of the — in terms of groups, I mean, I think you’ve seen you’ve seen folks like John Podesta and Bob Greenstein who have put out statements strongly in support of — as those on the left — put out statements strongly in support of this agreement.  So I think it’s that.  I think Jack Lew and Gene Sperling were at both caucuses yesterday, separate of the Vice President, the Senate caucus yesterday, and then with him later when he met with the House.

Q    On the smoking issue, he’s not on any gum, is he?  Because I know at one point he was chewing a gum or something like that.

MR. GIBBS:  I think he’s still chewing gum.

Q    He’s still chewing the gum, okay.  Then on “don’t ask, don’t tell,” if the efforts to move this forward fail, what is the President prepared to do?

MR. GIBBS:  Well, I think our efforts right now are focused on, as we have always said, what we believe is the best and most durable solution — that is one through Congress.  That’s where our efforts are directed.  That’s the reason that Secretary Gates worked through, with the military, the study and — the attitudinal study of our men and women in the armed forces.  And I think there’s no better advocate in that than Secretary Gates and Admiral Mullen in believing how much this needs to get done this year.

I think the President strongly believes that one of two things is going to happen.  Either Congress is going to solve this legislatively or the courts are going to decide this.  And the policy is going to come to an end.  Congress has to ask themselves how they want to end it and how — what role they want to play in ensuring that it’s done in an orderly way.  

Q    Robert, first of all, just checking today, have there been any phone calls by the President to members about the tax cut deal or any one of them –

MR. GIBBS:  I will double-check.  I have — I’m behind on my email, so I should check on that before I say yes or no, but I’ll do some checking on that.

Q    Okay.  And also, both in the statement from the co-chairman of the fiscal commission and in the members’ comments to Jack Lew and Tim Geithner today, they urged the President not just to have a budget summit with congressional Republicans but to put in his budget and in his State of the Union speech a call for his own debt reduction plan.  Does he plan to do that?

MR. GIBBS:  Well, I think that part of the purpose of the Cabinet meeting yesterday was to let Cabinet officials know that there were going to be some tough decisions and some tough cuts that were going to have to be made.  You’ve already seen the President make a decision that — to freeze federal pay — to freeze pay for federal workers.  And I think there are a number of very tough decisions that are coming that are going to have to be made to get our fiscal house in order.

Q    Did he put a number on it to the Cabinet officials?

MR. GIBBS:  I missed most of the meeting, and I don’t — I assume that they are working off some numbers.  I don’t know if the President said any in that meeting directly.

Q    But will he call for — will he have his own debt reduction plan early in the year?

MR. GIBBS:  Well, I think we — look, we have a budget that –

Q    On the scale — comprehensive and on the scale of the –

MR. GIBBS:  Well, I don’t want to get ahead of where they are in terms of budgetary decisions.  Obviously a budget process we have had since we got here to cut the budget deficit in half over a four-year period of time.

Yes.

Q    Thank you, Robert.  Two questions.  The first is that the President is going to meet Admiral Mullen this afternoon.

MR. GIBBS:  Say that again?

Q    The President is going to meet Admiral Mullen this afternoon.

MR. GIBBS:  Yes.

Q    And could you give us some detail about that?  And also, is North Korea still on the top of agenda in the White House?

MR. GIBBS:  Well, I think I can probably combine those two.  Obviously the Admiral is just back from a trip to the Republic of Korea.  And we have had — National Security Advisor Tom Donilon has had Korean and Japanese officials here to discuss North Korea and — along with Secretary Clinton.  And there will be additional trips to Beijing by senior administration officials to reiterate our call that the Chinese be clear with the North Koreans about their belligerent behavior and its destabilizing effect on the region.

Q    Also — sorry, Admiral Mullen said that he hopes Secretary Gates visit next month to China could strengthen both sides’ military relations.  So what’s the expectation of the administration about Secretary Gates visit to China?

MR. GIBBS:  Well, look, I think whether it is — whether it’s folks like Jeff Bader or Jim Steinberg or, as you mentioned next month, Secretary Gates, I think our message is, as I just said it, and that is China is in a position to have strong influence over the actions and the behavior of the North Koreans, and it is our belief that they should use their influence in that country to stabilize the region.

Ann.

Q    Thanks, Robert.  When the President made his announcement about the tax deal on Tuesday, he did not have legislative language in front of him.

MR. GIBBS:  Right, right.

Q    Is there any talk with the White House specifically about the numbers within the estate tax portion of it that would change or narrow the numbers that were at least in the fact sheets that the White House gave out?

MR. GIBBS:  Not that I’m aware of, no.

Q    You don’t believe so?

MR. GIBBS:  I mean, again, this was — this is not something that we have found — this is not something that we were the champions of.  This is not something that –

Q    How did it get in there?  Did it –

MR. GIBBS:  How did it get in there?  It got in there because this is what the Republicans said was the price of coming along for extending tax cuts for the middle class.  When the President stood up here and said we’re for — our goal is to protect the middle class and their goal is to protect the very wealthy, I would — I think it’s pretty safe to call that Exhibit A in that argument.  

Again, as both Jonathan and Suzanne talked about, the 2009 level was a $3.5 million exemption and a 45 percent rate on estates that exceeded that individual level.  This is a $5 million exemption and a 35 percent rate.  

Again, would we prefer a different rate?  Yes.  Again, there are — that’s why compromise is never easy.

Q    And when you look at the prospect of both some senators and some House members saying there really have to be some changes in this to — for me to support it, does the President see a risk in opening up any of –

MR. GIBBS:  Well, sure.

Q    — what is the risk?

MR. GIBBS:  Look, as I — I will go back to what I said yesterday, and that is, look, when you start –

Q    Yesterday you weren’t on camera.

MR. GIBBS:  No, but I’m not sure that my tie and this suit definitely will change this answer, but we have — I mean, obviously I think it goes without saying that if you start to unpack this deal significantly, we’re going to find ourselves sort of where we’ve been for several months, and that is at a stalemate.  

And I think, again, understand why we are here.  We couldn’t get a piece of legislation that went through the House, through the Senate.  That’s why we are — and that’s why it requires that we take some of what we may not like and some of what we may not be a strong supporter of in order to get enough people along that can get something done.

And I think if all we could do is this with — by our own choice and by writing all the rules and what have you, I hear people talk about that.  We tried that.  It didn’t get through the Senate.  It’s not — it’s just –

Q    It’s still take it or leave it.

MR. GIBBS:  No, again, as I said earlier, if somebody can figure out how to get — to make the agreement better for everybody, as Bob Barker would say, come on down.  Nobody would walk away from that.  I guess it wasn’t Bob who said that.  It was the guy who –

Q    Sure it was.

MR. GIBBS:  Oh, it was?

Q    “Price is Right” –

Q    That would be the other guy.

MR. GIBBS:  It was the announcer, technically, who — no, but I mean, but seriously — but no, no — but, again,
look, again, the example I used earlier, if you — if one side takes what the other side — if one side takes out what they don’t like, my hunch is that that’s what the other side likes and they’ll take out what they don’t like and then we’re sort of –

Q    But my question is, is that happening right now?  What we’re not seeing, is some of that give and take –

MR. GIBBS:  Again, as I said earlier to Jim’s I think first question, or somebody along the beginning here, is there are extenders — what we had is a rough figure of extenders that I think is still being worked — the details of which are being worked through.

Q    Robert, thank you.  We’ve seen an aggressive effort on the part of the White House to pass this package.  Obviously we’re seeing daily emails from the White House, very public individuals who are supporting this.

MR. GIBBS:  You guys haven’t learned so many mayors’ names in the last 24 hours as — there’s a quiz, I’m just warning you, at the end of this.  

Q    Who’s Charlotte Mayor — that’s what I’ve been trying to figure out — (laughter) –

Q    This feels, Robert, this feels a little different from what we saw over the last two years.  I’m not sure I remember anything quite so concerted and aggressive as this.  Is this a model for what we might see going forward?  Is this a new approach on the part of the White House to sort of build support and consensus behind what it wants to –

MR. GIBBS:  Well, look, I will say this.  I think it is important to — I think it is important to understand that, again, while there are differences and while there are those that have and will continue to express their concerns, I do think it is important to understand that the mayor of L.A. has a number of constituents; the governor-elect of New York and the mayor of New York represent a lot of people.  I think it’s important that we understand that there are even members in the House and Senate that they don’t always get on cable TV but they’re there.  And we think it’s important that people understood that.

Q    A quick follow-up.  You mentioned the President –

MR. GIBBS:  Plus we have free email.  (Laughter.)  

Q    You mentioned the President has quit smoking.  Anyone else in the White House that you’re aware of who has taken up smoking?  (Laughter.)

MR. GIBBS:  Under the law of conservation of matter that if one thing ends, another — I don’t –

Q    Has anyone taken up smoking to cope with –

MR. GIBBS:  That’s an excellent — wow, I think I can say this, too — I don’t know that Marvin Nicholson, who has smoked as long as I’ve known him, he has also quit smoking.  So it’s broken out.

Q    Have they started gaining weight?  (Laughter.)

MR. GIBBS:  Can I go on background as a senior administration official?  I’m sorry, Marvin, I had to — I think that — I don’t know of anybody that has started smoking, not that it — well, I’m not going to make a joke about that.  Lord knows.

Yes.

Q    I just had a follow-up to Peter’s earlier question.  Are all these emails and letters from various elected officials intended to pressure elected officials in Congress to come out to support the bill?

MR. GIBBS:  No, I think they’re intended — honestly, they’re intended to show that this is an agreement that has strong bipartisan support.  

Q    Sorry, real quick about — Attorney General Eric Holder sent a letter to the Senate asking them not to include a provision banning Guantanamo Bay prisoners from coming to the United States.  Will the President sign a continuing resolution that has a provision like that in it?  

MR. GIBBS:  Well, I think we would evaluate — the answer to that, we would — obviously you saw the attorney general’s letter consistent with administration policy, and has been for quite some time, before we would make any decisions about signing that after it’s been through the legislative process.

April.

Q    Robert, back on the tax issue, the Democratic caucus is using the words like they — like revolt.  They’re saying they’re revolting against this administration for what they’re calling a bridge too far.  Using your Bob Barker analogy, they’re saying the price is not right, because –

MR. GIBBS:  That was pretty good.  I’ll give you that.  That was good.  

Q    It’s Rod Roddy, is the guy’s name.

Q    Oh, look at what he did.

Q    Somebody fact-checked it for me.

Q    Oh, good, okay.

MR. GIBBS:  There you go.   

Q    All right, anyway –

MR. GIBBS:  You’d think Rod Roddy would be a name we could remember.

Q    Okay.  All right, well, okay, going back to the price is not right, they’re saying with this bridge too far on the estate tax, you would have to borrow $68 billion from China to give 32,000 families a relief with this tax.

MR. GIBBS:  Again, as you’ve heard the President say, this is not something that — this is not his idea.

But I do think, just in a series of fairness, the 2009 level, the exemption of $3.5 million at 45 percent is not cost free.  I do think it’s important to understand that — I’m not great at math, but I think the overall estate tax component is probably in the $70 billion — probably about a $70 billion expenditure.  Two-thirds of that — two-thirds of that is the 2009 level — the $3.5 million exemption at a 45 percent rate.

Because understand now if you simply extended the estate tax where it is now, it’s zero.  No rate, no exemption.  You’re free to go.

Q    But you didn’t even — you didn’t even talk about hen you talk about couples in 2009 at 7 percent and then now it’s 10 percent — I mean, $10 million — excuse me –

MR. GIBBS:  Right, no, no, it’s an individual exemption.  And obviously if you have — if you’re married and you have an estate, that’s an individual — the $5 million is an individual exemption.  The rate obviously holds.  If you’re a family it’s obviously double that.

Q    All right.  And now also on two other issues.  How is this administration promoting a credible election in Haiti with all the violence and uprising –

MR. GIBBS:  Let me get some — I’ll get you a statement on Haiti.

Q    And with smoking, many people say it could be linked to pressure or it could be something to relax — relax a person.  What did you see the President do — what was the timeframe?  How did it happen?  What was he involved in at that time when he was smoking, you last saw him smoking nine months ago?  What was the issue?  Was he having fun?  (Laughter.)  

MR. GIBBS:  I can’t remember the last time — I mean, I don’t remember the individual setting.  I don’t know that I would disagree — I don’t know that I would disagree — it’s a bit of — I’m not a smoker, but I think if you asked him he would likely say that for both — and again, I hesitate to do this on camera, just in terms — for both — for enjoyment and for some relaxation from the pressure that you mention.

Again, I hate to do this because if there’s anything in the world that I hope my son never, ever, ever, ever does, is this.  And his grandfather was a smoker until a doctor told him that he had lung cancer.  He’s still here, and hopefully will be for a long time.  But — I was told that by my dad at the end of my son’s third or fourth birthday party.  So it is — I think the President understands that it is a — as I said, this is not something that — it’s something that he’s greatly struggled with and not something that he’s altogether proud of.

Q    Thank you, Robert.

Q    Robert, tax bills are famous for a lot of deals, a lot of lobbyists getting things tucked in at the last minute, a lot of horse trading.  Will all the transparency rules apply?  Will you post this on the Internet?  Will the public have plenty of time to read the final language before it’s signed into law?

MR. GIBBS:  I have not heard otherwise, so, yes.  I may have just made administration policy but what the heck, right?

Ken.

Q    Robert, the 9/11 health care bill finally came up for a vote today, was defeated, as I think was expectations after doing some vote counting.  White House statement on that?

MR. GIBBS:  Let me get something for you on that.  I mean, obviously we have to do all that we can for those that put their lives in harm’s way and who risked their health in order to save others on that day.

Q    Follow-up?

MR. GIBBS:  Go ahead.

Q    The New York delegation has — they’re trying to see whether or not it’s workable to now attach this to the tax cut deal.  And they’ve got about 50 signatures, or about 50 supporters they claim at this point — wondering if that’s anything that’s on the White House radar screen.  Is that doable?

MR. GIBBS:  I don’t know the answer.  Let me check with Legislative Affairs on some of that.

Bill.

Q    Robert, you’ve told us several times that — on the Middle East — that a freeze on the settlements was at least one of the essential building blocks to successful peace talks in the Middle East.  And it sort of got lost this week, and nobody has asked about it, but the United States dropped its demand that Israel freeze its settlements in the Middle East — on the West Bank.

MR. GIBBS:  No, let’s be –

Q    So what happened?  What happened?   

MR. GIBBS:  Let’s be clear that — let me — I want to amend, if I can, your question.  Our administration policy on settlements is I think — we have the same position as administrations have had for probably dating back to Johnson on that issue.

As I said, I think at one point I was reading through some old transcripts and Reagan was asked about it at a — on settlements.  This is back in like 1982, so it’s a well-worn position of our government.

We still believe that it is in the interest of both sides to seek a comprehensive peace.  We will continue to be engaged to get each of the sides to take the steps that are necessary to get back to direct talks and to make progress on a two-state solution.

When the parties were here earlier in the year, we said this was going to require constant attention and constant effort.  We know that progress is almost impossible to make without our engagement, and we’ll continue to be engaged in and continue to have — work with the parties to do what’s right.

Q    But this is a change in the position of the administration in terms of supporting the Palestinians’ belief that a freeze is the first step towards serious talks.  Is this just — do you then at least admit that this is going to make it a lot more difficult to come to some agreement?

MR. GIBBS:  Look, not being — I think we continue to believe that — let me just say, we’ve got to have each side take steps to build confidence in this process.

Sam.

Q    Yes, if I missed this — back on the tax stuff, if I missed this, I’m sorry.

MR. GIBBS:  That’s okay.

Q    But from the White House perspective, what’s next?  What do you do next?  I mean, Speaker Pelosi says she won’t bring it up.  You say you’re confident she will.  How do you square this –

MR. GIBBS:  What I said was I believe that at the end of the day — maybe not today — (laughter) — but at the end of this, we will have a proposal that passes and the President signs that prevents middle-class families’ taxes from going up.

I think the next step, as I understand it, is that the Senate will take this up.  And I think that’s certainly — that’s one important step on this legislative highway.  And I think as you’ve — you’ve certainly seen senators, they’ve looked into this deal and analyzed this deal, they’ve seen others’ analysis of this deal, and I think more and more people have supported it.

Yes, ma’am.

Q    On the deficit commission?

MR. GIBBS:  Yes.

Q    On the tax side of the equation, they called for basically eliminating tax expenditures and slashing –

MR. GIBBS:  Eliminating what?  I’m sorry.

Q    All the tax expenditures, to get rid of all of them and to –

MR. GIBBS:  Oh, you’re talking about loopholes and such?

Q    Yes.  And then lower tax rates as a result.  So do you see a big push for tax reform then?

MR. GIBBS:  Well, I think — I have heard the President and others in the administration talk about tax reform.  I think it is something that the President would like to see us begin the process of, broadening — cutting loopholes, broadening the base and lowering tax rates.  

I think it is important to understand that that is not a process that will happen overnight.  That will take — as it did I think in the last major tax code revision in the mid ‘80s — that will take some time.  But I think it’s something that the President and the team certainly believe that it’s good to start that long process.

Yes, sir.

Q    Thank you.  On “don’t ask, don’t tell,” you mentioned earlier that the President sees this ending either legislatively or through the courts.

MR. GIBBS:  Yes.

Q    If it doesn’t happen in the Congress before the Republicans take control of the House, is the President prepared to live with a legal resolution?

MR. GIBBS:  Well, I will say Presidents are not often afforded a decision about whether they’ll live with a legal resolution.

It is not — look, I think the first thing that the Pentagon would tell you is it’s not their preferred route.  Look, you saw a decent amount of confusion when the Ninth Circuit effectively ended — well, not effectively — legally ended “don’t ask, don’t tell.”  There was some confusion about recruiting and how do you handle somebody who walks into a recruiter’s office for a couple of days.  

The belief of the President and I think importantly the belief of the Secretary of Defense and the Chair of the Joint Chiefs, not simply is the policy wrong and should be done away with, but doing this in a legislative way provides some transition period to implement the change.  The courts may not be as understanding as somebody in the legislature would be.

And you could easily face a situation where because of a court ruling, the law of the land changes in an instant.  And the best way to prevent that — and it’s coming — is to do this through legislation.  We’ve had hearings.  We’ve had an exhaustive attitudinal study of the military.  And it’s shown that ending this policy will not provide a significant disruption to our forces.  

And for some frontline battlefield forces that might have a greater percentage of those who think it might be harder to do, you can have a transition period.  But the policy can and should end legislatively on Capitol Hill.

Q    Is it now or never in Congress?

MR. GIBBS:  I think it is an important period of time, and I think we are closer than we’ve ever been.  And I think more and more each day you see senators coming out — the House has done this.  The House has taken that step.  I think every day you see senators coming out in support of its change, and I think we’re close.  

Thanks.

Q    Robert, is there any plans for the President or First Lady to attend the memorial service for Elizabeth Edwards?

MR. GIBBS:  Let me check with scheduling on that.  Thanks, guys.

END
2:55 P.M. EST