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E X E C U T I V E O F F I C E O F T H E P R E S I D E N T

THE WHITE HOUSE

Office of the Press Secretary

                           BACKGROUND BRIEFING
                                    BY
                      SENIOR ADMINISTRATION OFFICIAL

June 17, 1993

The Briefing Room

3:08 P.M. EDT

MS. ROMASH: Just to set the ground rules, this is a BACKGROUND BRIEFING. You can identify the gentlemen here as senior administration officials. [name deleted] is still on the Hill testifying. He will try and join us if he finishes his testimony on time.

I think you all should have information from this morning, the President's statement, a press release, a summary, and a copy of [name deleted] statement up on the Hill today. If you don't have that, let us know and we'll get it to you.

Why don't we get started. This is [names deleted]. We don't have any opening statements, so just fire away. Again, this is on BACKGROUND. You can identify these folks as administration officials.

Q Can you give us some sense of -- are we talking A minus B plus here? Could you talk a little bit about the alphabet soup question?

SENIOR ADMINISTRATION OFFICIAL: Right. We're talking Option A with improvements from Option B as determined in the next three months in consultation with the Vest Committee and with the Congress and with NASA. But the basic station model is Option A.

Q Are you going to go up to the standard NASA orbit or are you going to go up higher after the Russian orbit?

SENIOR ADMINISTRATION OFFICIAL: The Vest Committee highly recommended going up to the Russian orbit. That decision has not been made. There are also intermediate orbits between ours and the Russians that allow for international access, but those negotiations and decisions are still going on.

Q Now, you need a couple hundred more million in the appropriations bill, the House Appropriations bill, in order to meet the President's level. Is that going to be possible? To win space station will be hard enough; to get a couple hundred million dollars more will be even more difficult. How do you intend to do that?

SENIOR ADMINISTRATION OFFICIAL: The appropriations committees have been looking at that and also at the NASA budget in terms of what other savings in addition to our management savings can help us reach those targets in their markup in the next week. And we anticipate that

the levels of the President's budget can be reached by the Appropriations Committee through NASA savings.

Q Are you going to gut the technology package?

SENIOR ADMINISTRATION OFFICIAL: No, we are not going to gut the technology package. It was reduced from $500 million in the original submission to $200 million in the submission that went to the Hill today.

Q Can you go through the arithmetic? The President -- or Mr. Gibbons speaks of saving $4 billion to $7 billion in the next five years. How do you do that?

SENIOR ADMINISTRATION OFFICIAL: We are talking for the President's decision today, $2.1 billion a year each year for five years, which comes to $10.5 billion. Space Station Freedom's cost over the same time period was $14.4 billion. And to completion, the Vest Committee estimated Space Station Freedom at close to $26 --$25.6 billion I believe -- and the Option A at $16 billion. So, over the completion to permanently manned capability, we're talking a savings of $8 billion to $9 billion. After that, you have $1 billion a year savings from the President's decision today in operations cost over Space Station Freedom.

Q Can you tell me the impact on the Canadian contribution; there are three bits that matter. The glorified Canada arm, the baby robot with two arms and then this transporter. What has happened -- I gather that two would be safe because it's a, what about the transporter or the mobile platform; what has happened to that?

SENIOR ADMINISTRATION OFFICIAL: Until the decision is made about which parts of Option B should be appended to Option A for increasing the scientific capabilities -- those negotiations aren't complete.

The international partners, obviously, were part of the descriptions of Options A and B in the Vest Committee report and have been generally supportive of the President's decision. And we, obviously, have a lot of technical details to work out, but at this point we expect to be able to accommodate the Japanese contribution, the Canadian and the European.

Q The President at his press conference on Tuesday and again in the statement today spoke very glowingly about the Vest recommendations regarding NASA management.

SENIOR ADMINISTRATION OFFICIAL: Yes.

Q Could you tell us a little bit more about how the recommendations about managing the space station program can be applied to NASA across the board? Are we talking trimming bodies, organization? Could you just talk about that a little bit?

SENIOR ADMINISTRATION OFFICIAL: Yes. And then I would like to ask [name deleted], since this is his life experience. The Vest Committee had a very simple conclusion; that NASA as currently structured cannot build this space station or any other, and that a 30-percent reduction in federal and contract employees is required to be able to produce any space station. There is a significant number within that that could be achieved through early out at NASA. The number of people who could be eligible for such a program vary from 4,000 to 8,000 based on the type of early out and when it is implemented.

In addition to the personnel reductions that are working on the space station, there is also the issue of the management structure. Right now, the management structure is labyrinthine. Everybody is in

charge and no one is accountable, and the Vest Committee proposed a different sort of management structure to provide more line accountability. And now I'll my colleague add to that.

SENIOR ADMINISTRATION OFFICIAL: My colleague made the points absolutely right. The only thing I'd add to it is that these are views which the Vest Committee, I think, has put together better than anyone else has for sometime, but that have been felt strongly by external observers of NASA for a long time. I've felt them throughout the '80s in membership on various commissions. And [name deleted] and I've had -- is a member of the Vest Committee -- have had long conversations. And the labyrinthine, which is the term my colleague used, is really the best word, the best point, in that NASA has gone for a very long time without going through the kind of organizational -- forgive the word, but organizational re-engineering that most major companies have had to go through in the last seven to ten years.

And that's basically the point, is it's decision structure is cluttered, it's circular, it's labyrinthine. And what I think the Vest Committee basically meant -- it's certainly what I would have meant had it been my original observation as opposed to the Vest Committee's -- is when they saying that NASA could not build the station, could not have built -- or space station Freedom could not have been built, was simply that the organizational structure to provide clarity of decision, clarity of line management wasn't there to do it, that someone needed to be in charge.

Q What can you tell us about contracts? Which ones will need to be terminated or bought out? And also, is the White House going to take the recommendation of the Vest Committee to go with a singlesource contractor and change the management style in that way --as the redesign team suggested?

SENIOR ADMINISTRATION OFFICIAL: I can't tell you enough, and I'm not trying to dodge the question, I can't tell you enough yet to be informative. One of the reasons why we keep saying that we need the summer is that we went as far as we felt we could and still be reasonably accurate in both what we said in terms of policy terms and what we said in terms of organizational terms. And the answer to the question is that, frankly, we've got to go through in detail with NASA, and NASA will have to make the decisions about what has to get renegotiated, what has to get discussed.

Q Are there any obvious losers with Option A, though, that you can tell us?

SENIOR ADMINISTRATION OFFICIAL: I couldn't tell you right now.

SENIOR ADMINISTRATION OFFICIAL: Let me add to that --just one second -- that the contracting situation now could be described as either no primes or everybody's a prime. (Laughter.) The Vest Committee's work was added to by staff from the national performance review that the Vice President has initiated within NASA and without of NASA to identify just these kinds of problems that were identified --not just the number of people, but what they were charged with doing. And let me give you one basic example.

You will note in our handout that the space station budget has two major components: the development budget and the science budget. They were controlled by two different offices. So there was no one office that was in charge of the space station budget. Small wonder that we were never able to say in previous administrations what the real cost was, because no one person was in charge of it.

Q A follow-up to that. Isn't it true, though, since you're going to go with a prime, a single prime, that Grumman is out as integrator?

SENIOR ADMINISTRATION OFFICIAL: I couldn't get into that level of detail at this point until we look at exactly what the tech package -- the station itself, the engineering and technology package would entail.

Q on Capitol Hill say that this will not pass anyway unless the President takes an active, affirmative role in supporting it and pushing it. Will he do that? And if he does, will he also try to find some way to secure stable funding, without which the thing will continue in its current pattern?

SENIOR ADMINISTRATION OFFICIAL: The President has certainly now done everything -- to date has done everything that he said he would do. He said that he would request a redesign for the station that involves significant cost savings. He set up a structure. He then abided entirely by the structure. One of the things that we did was be, I think, obsessive about making certain that, having set up a structure, we allowed it to operate in an integral fashion; that the redesign did, in fact, yield substantial savings. The President has spoken -- has supported the process, the Vest Committee report; has spoken in glowing terms about the need to continue a station. He has his director of OSTP up testifying as we speak. I think that you can and should assume the President will support this.

Long-term stable funding. One of the implications of doing this now, given the cap situation now and in the future years, is a clear indication that this is a high priority for the administration.

Q But he didn't do the thing he set out to do, and that's to limit the cost to $9 billion.

SENIOR ADMINISTRATION OFFICIAL: Well, what we could have done is say that we did it and not be telling the truth. What we did is that the commission did the best it possibly could, it did a damn fine job, and we took it at its word.

Q Is the White House is satisfied the numbers you have are accurate and you're willing to stand by the numbers that were developed by NASA and the endorsement by the Vest Commission?

SENIOR ADMINISTRATION OFFICIAL: We are -- let me say this carefully -- we understand the process that they went through and believe that the process was a rigorous process and a good one and an honest one. I couldn't for a minute vouch for every number in an area that I don't understand that much.

Q I want to be correct on the arithmetic. As far as the taxpayers' concern, this thing's already cost about $9 billion and you're adding another $16 billion, I understand, to bring it to operational readiness, at which point it will cost about $1 billion a year to operate? So we're talking about $25 billion plus operational costs?

SENIOR ADMINISTRATION OFFICIAL: Let me clarify that.

Q Is that correct?

SENIOR ADMINISTRATION OFFICIAL: The money spent to date plus the $16 billion for Option A would amount to $25 billion. But let's be clear what we're buying for that. There has been the concept before that we are putting up a tinker toy in space and until you have the entire thing, you have nothing. What we're talking about today is the beginning in five years of putting up in space the capacity for an orbiting science laboratory and that can be added on and improved over the years as we can afford it, and as it pays for itself in terms of the results.

At the end of five years, under the President's decision, we will have human-tended capability, that is a laboratory, a power station, and the shuttle dock there to do work, that will have immediate value in five years. And then we will add value to it over the remaining time.

SENIOR ADMINISTRATION OFFICIAL: If I could add to that, and it's a point I've made to a number of you all in the room, is that there is a -- you have to see this not as a tinker toy, not as a particular project, but as an infrastructure and as a new kind of infrastructure. And in that respect, it is much like other major scientific and technological infrastructures that a government supports.

Moving from that down a little bit, what is really truly difficult and what is hard to fathom is the first kind of big step, which is getting something up there that can be built upon. You can quarrel about whether that first step is getting a power supply up, or whether that first step is getting to man tended -- whatever it is, it's that first step that is absolutely crucial. Once you have the capacity to start to do something, then you can make a judgment increment by increment as to whether it's worth it. But you'll never have the opportunity to make that judgment unless you take the first step.

Q As far as your current plans are concerned, is $1 billion a year to operate, is that what you're thinking of?

SENIOR ADMINISTRATION OFFICIAL: The number's $1.4 billion; the Freedom number is $2.4 billion.

Q That's $1.4 billion a year?

SENIOR ADMINISTRATION OFFICIAL: The savings that [name deleted] had in mind was the billion difference between the two of those.

Q international contributions, what, given this sort of fuzziness about the second phase -- what have you told Canada, Japan and your international contributors?

SENIOR ADMINISTRATION OFFICIAL: We've told them that we're committed to the station.

Q Do you want more international involvement in this initial stage?

SENIOR ADMINISTRATION OFFICIAL: Are you referring to the first five-year stage?

Q Right.

SENIOR ADMINISTRATION OFFICIAL: Just as we are being flexible in changing our design. We are asking the international partners to also take a look at how to maximize their contribution to the station.

Q What kind of contribution?

Q Are their contributions going to be the same as they have been, or are you looking for contributions to cut the U.S. cost during the first period?

SENIOR ADMINISTRATION OFFICIAL: Well, the U.S. cost of the $2.1 billion a year is what we're going to spend. For the international community to expedite their value from the station, it is in their interest as well to look at how they can lower their costs and hopefully expedite their ability to bring their modules to the station under the schedule that we have now.

Q You've been talking about astronaut capabilities. What does it take for a permanent occupation after 1998?

SENIOR ADMINISTRATION OFFICIAL: That's the total of $16 billion.

SENIOR ADMINISTRATION OFFICIAL: That gets you the $16 billion.

Q The $16 billion gives you the permanent in year 2001?

SENIOR ADMINISTRATION OFFICIAL: Yes.

Q Are you looking for funds from your international contributors?

SENIOR ADMINISTRATION OFFICIAL: The discussion with the international partners deals with their technology and their approach on how they would hook up with the station and how to make maximum use of their technology. We are not at this point talking cash contributions. We're talking about engineering changes that reduce cost -- for instance, smaller air locks and that sort of thing.

SENIOR ADMINISTRATION OFFICIAL: The point that -- let me expound on the point because the point that he was making is the following, and it's a very simple point -- is that we've gone through a very substantial redesign and have discovered opportunities for cost savings and design improvement. Without changing the basic thrust of what the international partners have proposed to do in their technology, our sense is that over the summer they may well do the same.

Q Are you sending a message, though, to the international partners that you intend for them to renegotiate what it is they're going to contribute to the station?

SENIOR ADMINISTRATION OFFICIAL: No.

Q Can you give us an idea of what was discussed between Vice President Gore and Mr. Chernomyrdin I guess on Tuesday it was? Evidently, the space station was going to be on the topics of discussion in those meetings.

SENIOR ADMINISTRATION OFFICIAL: I wasn't there, so I can't tell you.

SENIOR ADMINISTRATION OFFICIAL: I think you're talking about the meeting that didn't take place.

SENIOR ADMINISTRATION OFFICIAL: Unless you're talking about -- there was no meeting between the Vice President and Chernomyrdin last week. I thought you were referring to one with some other members of the Russians a month ago.

Q In addition to the Soyuz's assured crew return vehicle, will the administration make an effort to involve the Russian Federation in the development of this new space station? Will it extend to launch vehicles, launch services? Can you give us some notion of that?

SENIOR ADMINISTRATION OFFICIAL: I think the short answer is that those haven't been discussed yet.

Q How about the long answer?

Q Do the cost estimates include the Russian involvement?

SENIOR ADMINISTRATION OFFICIAL: Yes. I mean, the cost estimates are for the structure as you've seen it, for the U.S. involvement --

Q Will that mean accommodating the Russian orbit?

SENIOR ADMINISTRATION OFFICIAL: Could be extra cost or extra savings, depending on how the design works and what the participation is.

Q Will there be management changes just for a space station, or for NASA across the board?

SENIOR ADMINISTRATION OFFICIAL: Well, you certainly should have taken the strong point from both the report and what we said is that we would think that the Administrator will put in changes in terms of the management of the station. And our own sense is that that can't help but flip over to NASA as a whole. But those are his decisions.

Q At the beginning of the briefing, you mentioned a cut in a particular science package from $500 million to $200 million, I think. For the nonexperts, can you explain what that is?

SENIOR ADMINISTRATION OFFICIAL: The President's budget included $500 million when it was submitted in February for a new technology package within NASA. Many of these programs involve NASA industry cooperation similar to what the advanced technology program would be doing at the Department of Commerce. Some of them involve improving the expendable launch vehicles. Some of them involve work on advanced rocket technologies. Some of them involve small satellite programs and the Discovery program, which is a solar system exploration program. They also involved institutes, NASA technology institutes that would be around the country. That package has been reduced in size and certain priorities selected within it, and sent up to the House Appropriations Committee for their review.

Q And that savings is going to go toward a space station? Is that the idea?

SENIOR ADMINISTRATION OFFICIAL: Well, the original budget was $2.3 billion, and there was basically an agreement with the House appropriators that that would be -- we'd have a placeholder of $1.8 billion and $500 million for the technology package, with a player to be named later based on the Vest Committee report. And based on the Vest Committee report, we have now changed those numbers slightly.

Q To what?

SENIOR ADMINISTRATION OFFICIAL: To the $2.1 billion for the station and $200 million for the technology package.

Q There have been several reports that Mr. Golden, the Administrator of NASA, would save his job if he pulled this redesign effort off. Has he saved his job, or are you still thinking about a replacement?

SENIOR ADMINISTRATION OFFICIAL: I thought that was my problem. (Laughter.) All of us work at the pleasure of the President, and I'm not aware of any save-your-job situation.

Q The Administrator's name was not included in the President's statement; Vice President Gore's was, Dr. Gibbons's was. Why is that?

SENIOR ADMINISTRATION OFFICIAL: The President was responding to the Vest Committee report, which was outside of NASA, and to the Vice President's work in the national performance review on the management changes. The recommendation is officially coming from the Vest Committee, but the President, in the press release and I think in

meetings and in other public comments, has said very nice things about Dr. Goldin's work in this regard. The fact that it wasn't in the official statement has absolutely no implications.

SENIOR ADMINISTRATION OFFICIAL: If you'll note in the testimony that Dr. Gibbons gave today, there's a specific reference to the Administrator in there and the job that he did in this effort.

Q Can I follow up very quickly on the Russians? Will there be an effort to go beyond the Soyuz, incorporating the Soyuz as part of the space station to involve Russians, the Russian government in this project?

SENIOR ADMINISTRATION OFFICIAL: We can't really -- we can't speculate about things we don't know. As you know well, coming out of Vancouver, the Vice President was, in fact, put in charge of the SUTAS, of the development of the SUTAS cooperative relationships with the Russians. What those specifically are and that there are mutual dependencies between them involve a whole series of things that haven't been worked out. And that's goobly-gak, I know, but it was sort of intended to be.

Q Whose going to make the final decision about the inclination? WIll the White House make that?

SENIOR ADMINISTRATION OFFICIAL: Beats the hell out of me.

SENIOR ADMINISTRATION OFFICIAL: First there has to be some further negotiations with the international community and a look at the technology and the technological problems and opportunities, and a balancing decision made. But the White House will be working with NASA and with Congress based on the implications of such a move to the Russian orbit.

Q Is there coming a time when you quit planning, when you can actually say, this is what we're going to do, this is what it's going to cost?

SENIOR ADMINISTRATION OFFICIAL: The President proposes; the Congress disposes. The President --

Q But things like the inclination --

SENIOR ADMINISTRATION OFFICIAL: This will have to be decided by the fall. When the conference bills are finalized in the Congress we will have a final program in place.

Q Do you have any concern that by streamlining the management you're going to erode support in the Congress? Right now practically every member has a piece of this.

SENIOR ADMINISTRATION OFFICIAL: Well, our sense would be that, by and large, making the management of NASA -- improving the management of NASA would enhance the attractiveness of the program to the Congress.

Q I'm sure improving the management would, but I'm talking about all the different subcontractors. You know, right now a lot of people have pieces of the space station in their districts.

SENIOR ADMINISTRATION OFFICIAL: Our view of it is that it is a national technology project which we're supporting because it's good for the country. Congress will wind up supporting it or not supporting it on that basis.

SENIOR ADMINISTRATION OFFICIAL: A comment to add to that. At the hearing we were just at, the Chair of the Appropriations Subcommittee, Mr. Stokes, made the comment that those management changes

were exactly what the committee had been seeking for some time. And to the extent that that builds support in that committee it's obviously helpful to the station.

And the other thing to keep in mind is that the Vest Committee did say that without these management changes that NASA probably could not build any space station. So, to the extent that the supporters of the space station want to see a station developed and built, this is the only way to get there.

Q Can you give us a clear, concise explanation of why President Clinton thinks we ought to have a space station?

SENIOR ADMINISTRATION OFFICIAL: I think that the argument that has appealed and the point that's appealed to many of us for a long time is the fact -- is the infrastructure point; is that you have in essence an entirely new environment and that it is of -- there have been a large number of arguments that it is of potentially immense importance to be able to carry out both science and technological experimentation and development in that environment.

No one can really know what is the precise mechanism by which to do that until you have an instrument, a vehicle through which to do that. So that the best way to think about it is the creation of a new scientific and technological infrastructure for the country, not as a project, not as a specific piece of science. We would argue that it's a technological infrastructure. It is certainly not basic science by itself.

Q? Could I ask -- I realize you've been asked this before but once more -- could you give a ballpark estimate on what it would cost to pay off the contractors who are now working on things that you're not going to use?

SENIOR ADMINISTRATION OFFICIAL: And the answer is that we don't know the answer to that question yet.

Q Do you think it's likely to be in the million dollar range, like it's been estimated?

SENIOR ADMINISTRATION OFFICIAL: We just don't know. We can't speculate, we don't know.

SENIOR ADMINISTRATION OFFICIAL: Let me go back just a moment to the question about why are we doing this. It is not just the capability of doing science and technology in space. It is also the capability of the technological infrastructure we have on the ground. There are skills, there are technologies that are developed to support the space station that exists nowhere else on Earth. And the United States should not lightly dissolve this with both a huge technological and economic cost when we have the opportunity as a world leader to develop this technology within a budget and with achievable milestones in a way that can teach us things about space, teach us things about ourselves, and help our economy through technological progress.

Q Do you think the American people understand this and support it and will tell people on Capitol Hill to support it so that it might eventually end up in something floating up there a hundred or so miles up?

SENIOR ADMINISTRATION OFFICIAL: Look, it would have been easier in a number of different places to back out. It would have been easy in January when we were putting together the economic program to begin with. It certainly would have been -- you can make an argument it would be easier right now. We decided it would not be. We decided it would not be with as much -- probably no more, but with as much knowledge as you have about the fact that there is a substantial amount of

congressional opposition to this and knowing, therefore, that we have a convincing job to do.

Our view is that the combination of the fact that, a, there has been a substantial redesign, b, that there will be substantial management savings emerging from this, and c, that the argument for it is a critical piece of both space and terrestrial infrastructure is not only a -- it's a sellable argument because it's the right argument. So we wouldn't have gone forward if we didn't think, a, it was the right thing to do, and, b, that we could sell it.

MS. ROMASH: This is the last question.

Q But aren't you risking a perception both on the Hill and amongst the public that when the stories appear tomorrow, because you haven't decided which parts of B are going to go on A, that there's going to be confusion, that it's going to look like mush, and people are going to say, well, it's just more of the same?

SENIOR ADMINISTRATION OFFICIAL: First off, it's legitimate to ask, why can't a space station look like the Starship Enterprise. They always look relatively complicated. The American public, going back to John's question, want a space station. They just have never believed we could get there from here the way it's been done so far.

The story tomorrow won't be mush. The story tomorrow is that the President has chosen one of the three options by the Vest Committee. We have a few months to maximize the benefit from that option. We're not going to try to do things in a hurry. If we don't do it right the first time, how are we going to have time to do it later? And between now and September, the decisions on the details will be made to allow this to go forward.

Today the decision is that we're choosing the modular option over the other options. And we are going to have the kind of budget and the kind of management controls to achieve it.

SENIOR ADMINISTRATION OFFICIAL: If I could -- this is the last point, but if I could expand on that because it's not mush. What I say on this of an editorial nature is probably not going to influence what you write, but let me try to make the point, that the incentive in a big public policy decision like this one is always to take the marginal way out. It's to kind of marginalize yourself to death. That's always the incentive. The President didn't do that.

The President put this into a process which led, within the time frame that he proposed, to a quite clear decision. He chose one of three alternatives. It led to substantial cost savings. It will lead to substantial management changes and savings, and it has a clear rationale. There are details on the edges that remain to be done. I guess the thing that we would ask is your forbearance as well as that of the audiences that we go and talk to, that we had a choice between doing it right or pretending we had everything done. And there are details on the edges, as my colleague has said, as we both said from the beginning, that need to be done. But the level of clarity, we think, is really pretty hard to argue against.

Q Can I follow up on that point, though? That the lack of decision has an immediate impact upon your international contributions, specifically on the Canadian part, because half the money has already been spent and the decisions are all being taken. What do you expect the international contributors to do?

SENIOR ADMINISTRATION OFFICIAL: Actually, we expect the international contributors to be pleased with the way we've proceeded and highly cooperative, and we suspect they will. It is for the first time - - I mean, they have -- of a program that's been troubled for some

time, they have a President standing up and saying that he's committed to it, that he's committed to it in a particular direction at a particular cost level, and with respect to a direction that can accommodate them. That's pretty good for one day's work.

Thank you.

END3:39 P.M. EDT