*EPF201 01/15/2002
Transcript: White House Press Briefing, January 15, 2002
(Taxes, Social Security, Enron, senior staff, President's health) (2480)

White House Press Secretary Ari Fleischer briefed reporters traveling with the President as he returned to Washington from a two-day domestic trip.

Following is the transcript:

(begin transcript)

THE WHITE HOUSE
Office of the Press Secretary
January 15, 2002

PRESS GAGGLE BY ARI FLEISCHER

Aboard Air Force One En route Andrews Air Force Base

MR. FLEISCHER: Really, I've got nothing on my mind, no statement. So I just wanted to see if anybody needed anything from me.

QUESTION: Apparently, tomorrow, Kennedy is going to talk about rolling back some of the tax cuts, using them for prescription drugs, help shore up Social Security. Is the President aware of that and were some of his remarks yesterday and today specifically pointed at that?

MR. FLEISCHER: Well, the President hopes that Senator Kennedy won't make that mistake; that would raise taxes on the country. The President thinks that raising taxes in the middle of a recession is the worst thing he can do; that will hurt people, will make them lose their health care. It will put people -- it will make people lose their jobs.

Q: Ari, I'm sure you've answered this before, but since what they seem to be talking about is simply not enacting tax cuts that haven't taken place, how is that a tax hike, when nobody -- isn't a tax hike when you see your rates go up?

MR. FLEISCHER: Your rates would go up. Under the tax law that was passed with a bipartisan majority of the Congress, people have been promised more money in their paycheck, and they're making plans because they're going to have more money in their paycheck. If now you tell people, we're going to take that money out of your paycheck, you're not going to get it, that's a tax hike.

And on policy, let me give you two examples where, let's just continue that line of reasoning, that if you take -- if you revoke what is already the law of the land, the Democrat school of thought that that is not a tax hike -- I'll give you an example that I think you'll understand, on Social Security, for instance.

Under Social Security, it is law of the land that an increasing amount of your money is subject to Social Security payroll taxes every year. Last year it was approximately the first $72,000 of income that's subject to Social Security taxes. This year it's approximately the first $75,000. Next year it will be approximately the first $78,000. It's indexed to inflation.

If a Republican were ever to propose, or if anybody were ever to propose postponing or delaying that COLA provision, I think the press would immediately say, that's a tax cut for the rich. If somebody were to propose delaying COLAs for seniors who are on Social Security, I think the press and the Democrats would instantly say, that's a cut in COLAs.

The point being there's a consistent standard that should be applied to all tax policy, and that is, if there is a provision that is enacted into law, that is the law of the land, and if you delay it, if you slow it down, if you revoke it, you are imposing a tax increase on the country and on the American people.

And to be consistent to the standards which I think people would agree on how the press would view any of those other actions I mentioned, it would be inconsistent not to call this a tax hike.

Q: Ari, is the President being kept up to date on the developments in the Enron case? Have you discussed it with him at all lately?

MR. FLEISCHER: Of course, the President is aware. It is also a matter of criminal investigation. And criminal investigations will be handled by the investigators. It will be handled by the independent attorneys at the Department of Justice. It will be handled by the Securities and Exchange Commission. And those matters will be under their purview to determine what criminal wrongdoing took place, if any.

It's the President's belief that if there is any criminal wrongdoing, that people need to be held responsible, they will be held responsible, they should be held responsible.

Q: Does the White House have a fix on precisely how many times Ken Lay or other top executives called senior government officials?

MR. FLEISCHER: Terry, on that question, the White House is going to continue to be helpful and provide information that is specific and that -- suggestive of some type of wrongdoing where that is relevant.

But if people want to know about every contact that anybody has had with anybody about anything, that's a fishing expedition.

Q: Can I press you on that? Why isn't that a fair question, with this gigantic bankruptcy and criminal investigation to ask how many times was the White House contacted?

MR. FLEISCHER: If there's a suggestion of wrongdoing, we will pursue it. But in the absence of that, it's like saying how many times was the White House contacted by this company or this union. What's the specific question, other than contact? Because communication is the normal business of the government. Wrongdoing should be and will be pursued. Communication is different from wrongdoing.

Q: Ari, has he had any emotional reaction about the people, the employees who are -- I mean, is he bothered by that, angered by that? Can you --

MR. FLEISCHER: Absolutely. You bet. And that's why the President ordered the Secretary of Labor, the Secretary of Treasury, the Secretary of Commerce to review how to prevent this from happening to anybody else who works for a company who's lifetime savings, 401(k) are invested in markets.

The President, being a Texan, is deeply concerned about the people of Houston. This has affected thousands of workers in Houston, not to mention the ripple effect it's having on Houston's economy. There is real life suffering going on as a result of what's happened with Enron. And the President is concerned not only for the employees of Enron, for people who are going to retire who are now unemployed, that worked for Enron and for the broader community.

He's also concerned about the implications, policy-wise, this has on people who have retirement plans in other companies. That's why he ordered a review.

Q: Has the President gotten any impression that these sorts of procedures that were carried out by Enron have been happening, even on a smaller scale, in other companies? I mean, you know, his whole shock and surprise over this happening at Enron, has he gotten any idea that it may be going on elsewhere?

MR. FLEISCHER: Well, what's the "this" that's going on elsewhere? Can you be more specific?

Q: As in the type of fiscal raiding that went on at Enron, is he getting an idea that that may be going on in companies --

MR. FLEISCHER: No, there's no indication of that. But that is why the Securities and Exchange Commission and the Justice Department have launched investigations. They will pursue their investigations wherever it takes them, as they see fit.

Q: Just out of his initial request to look into this and see what happened, he has not gotten any indications that other companies were carrying on as in Enron did?

MR. FLEISCHER: There has been nothing that has been brought to my attention that would indicate anything beyond that which is publicly known at this point.

But, again, those matters are going to be reviewed. That's the purpose of having investigators.

Q: What's your reaction to the Washington Post story today about the senior staff re-shuffling?

MR. FLEISCHER: Laughable. We were all kidding each other about it. It's one of the most -- it's a typical silly Washington laughable item. We were getting a chuckle out of the sourcing -- rumors from K Street, people close to the White House. Those very well could have been tourists standing on the other side of the gate. (Laughter.)

Q: Ari, I just wanted to follow on Terry's question. When you say that communication, obviously, is the business of government -- so what you're saying is you don't feel that the White House, more broadly, the administration, the need to catalogue all the contacts between Enron and government officials? That's correct, right?

MR. FLEISCHER: That's correct. The White House will continue to be helpful and provide information that is relevant, especially if anybody has any allegations of wrongdoing by anybody in the White House. Bring those allegations of wrongdoing forward and we will examine them.

Q: I understand that. So what's the difference between perhaps as yet unknown contact that someone from Enron may have made to somebody in the administration and the contacts that you've disclosed already? Why disclose those based on your --

MR. FLEISCHER: We're trying to be helpful in answering people's questions. But if you're saying is the White House engaging in a comprehensive gathering of any contact with anybody on anything, the answer is no.

Q: Only as you're made aware of them are you making us aware of them? That's correct?

MR. FLEISCHER: And the "them" -- keep in mind, again, I think specifics are very important here. You said are made aware of "them." "Them" is communication; "them" is contact. You get no wrongdoing, no suggestion of something sinister.

Q: But for an investigator, you'd have to know about the contact to pursue that and see if there was wrongdoing.

MR. FLEISCHER: And that is the difference between an open-ended fishing expedition and answering specific questions when somebody has a suggestion of wrongdoing. And, still, no one has made any specific allegation of wrongdoing -- yet, there still is this yearning in the press to know every communication, every contact without any suggestion of wrongdoing. And that's the line the White House is walking to be helpful, to answer inquiries, without going down this trail that any contact with anybody for any reason is a suggestion of something that was done wrong. That's not the approach.

Q: What would you say to people who would call Enron the equivalent of Whitewater?

MR. FLEISCHER: I think what you have to look at in the Enron situation are three broad categories. One is criminal: are there any criminal wrongdoings by people at Enron or any companies or entities associated with Enron -- in the audit process or anywhere else.

In that sense, any criminal activity must be and will be pursued by this administration, through the Department of Justice.

Two is policy: are there any policies that need to be changed either through the Department of Labor to protect people's pensions, or through the Department of Treasury and through the SEC to review accounting procedures, to protect transparency, accuracy in financial reports.

People can draw whatever parallels they want to about those two legitimate inquiries with anything that came before. When it comes to politics, nobody has made any suggestions of wrongdoing by anybody in the White House, and that makes it a totally different nature from Whitewater.

Q: Can I ask you one more question, Ari? Given how much money Enron gave to numerous politicians, including the President -- you know, a really large amount of money with unprecedented reach -- what do you think they were after?

MR. FLEISCHER: Jay, I think what you've seen here is for this administration, whether a request came in from a contributor like Ken Lay or a Clinton official, like Robert Rubin, the administration reacted based on what it viewed as the right policy for the country. And that's been a consistent approach.

Whether it was on Kyoto, global warming, where Enron would have wanted the administration to agree to the Kyoto protocol, or to the elimination of carbon as part of the four P policies -- the administration made its decisions based on what it thought was the best policy for the country, no matter who asks the administration or who weighed-in on behalf of Enron.

And I think that's what the American people want the government to do, make independent judgments about what's right or wrong for the country. People can differ with the administration on the actions it takes -- certainly, people have done that on global warming. But the administration has been consistent on its approach to the manner in which it bases decisions.

Certainly, there's been no shortage of people in either party who have received money from Enron. There's no shortage of lobbyists who are connected to either party, who worked for Enron.

Q: So how is the President's face doing today?

MR. FLEISCHER: His face is fine; his nose is runny.

Q: Did he get checked out by the doctor again today?

MR. FLEISCHER: The doctor talked to him this morning, did not check for vital signs, just asked him how he's feeling, looked at it. One thing, the President showed this to me this morning, is on his left eye, as it starts to heal a little more, you can now start to see indented on the top bridge of his nose, on the side of his cheekbone, indents where it looks increasingly likely that the glasses dug into his cheekbone and into the top bridge of his nose as he hit either the coffee table or the ground.

Q: What are they doing about that runny nose, I mean, the cold? He just has a garden variety cold?

MR. FLEISCHER: He's doing what every American does, wishing it would go away.

Q: What's he doing when he gets back today?

MR. FLEISCHER: He's going to have a relatively easy day at the White House when he returns. He's going to sign -- do a little paperwork, maybe just have some staff meetings; no public events.

Q: Did he work out this morning?

MR. FLEISCHER: No, he did not.

Q: What about yesterday?

MR. FLEISCHER: No. Actually, I know he didn't work out yesterday. I talked to him this morning in his suite -- I don't think he worked out, let me be precise. I don't think so.

Let me also clarify one thing that I said, too, that Reed brought to my attention that's incorrect. I had thought this was the President's first domestic overnight trip since September 11th, and I'm reminded of New York City, the United Nation meetings up in New York City where, of course, he stayed at the Waldorf -- so just to be accurate.

All right, anything else?

Q: On the phone calls, you say you're not sure he's called any --

MR. FLEISCHER: No, no phones to foreign leaders today.

Q: Has he heard from Secretary Powell?

MR. FLEISCHER: I don't know if he spoke to Powell yesterday or today. I know he has not spoken to any foreign leaders.

Okay. Thanks, everybody.

(end transcript)

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