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Office of the Press Secretary

For Immediate Release March 8, 1994
                            PRESS BRIEFING

The Briefing Room

1:42 P.M. EST

MR. RUBIN: I'm Bob Rubin, and what I will do is go through what we're going to do at the G-7 Jobs Conference. And then I'd be delighted to respond to anything relating to that, or I suppose anything else that relates to the economic issues the administration is dealing with. (Laughter.) Those, I presume, are of greatest interest to this crowd.

Let me start by saying what this is and what it's not. What it's not is a conference that is going to result in a communique or events or initiatives. What it is is an opportunity for the ministers in the various countries to get together and discuss the issues that they all face in common.

Really, the genesis of this was one day we were sitting in the Roosevelt Room before the Tokyo Summit and planning the agenda for the summit. And the President said, you know, it's interesting, all of the G-7 countries have a problem in common -- high rates of unemployment that seem to have become somewhat chronic; in many cases really have become chronic. And secondly, they're all facing this issue of unemployment at a time when there are enormous changes that are going on that affect the economy. As you know from other things he's talked about, he is very much focused on what he believes is the enormous changes that are taking place right now that affect all of us -- globalization, technology, the reorganization of the work forces.

He said the other day -- we were talking about something -- that while all periods are periods of change, this is a period of particularly great change as it affects economies. And he says, shouldn't we get together the people who are really involved in making these decisions -- not the academics and not the experts, but the people who really have to bring policy and politics together, and have a conference where people can simply exchange views as to what they're doing, why they are doing it, what their experience is, what's worked, what hasn't worked. And wouldn't that be of great benefit?

And it was out of that thought that came the notion of having this conference, and then the announcement he made in Tokyo. So that's what this conference is really about.

I think it should be very interesting, but not, as I said, because it's going to produce events or initiatives or a communique, but rather because I think it will give everybody an opportunity to really give some thought over a period of a day and a half to the underlying issues that are going to affect us for years to come. I think it will also give press and others who are interested an understanding of how these different countries are facing these issues, and a framework as they then watch what's happening in these countries, including our country, now and in the future.

Our hope is that all the participants will leave with both a better understanding of the perspectives of the other countries, and a broader sense of these issues and the things that they might think about in respect to these issues.

Another benefit of this conference is the preparation itself. I know in our case -- I don't know what other countries have done -- but in our case, we've had an extensive outreach program. Each of the agencies involved has outreach, and at the White House we've had people in to discuss these issues. In the course of that I think we've broadened our field for these issues and feel for the kinds of things we ought to be thinking about.

Finally, while there's nothing specific intended to come out of this, I think what you really have is a G-7 process in this post-Cold War world that is turning towards far greater focus on the economic issues and the unemployment issues that have so plagued us all, and this is a part of that process. Somebody observed the other day, if you look at the post-World War II period, the immediate postWorld War II period, some very big institutional changes came out of that period. They didn't come from a single meeting. They came from intense focus over a course of time. And I think that's what you're now starting to see with the G-7; with Tokyo, with this conference, then with Naples, with the OECD, and what I suspect will be a more frequent process of those kinds of meetings in the time to come.

With that, let me get down to a bit more of the specifics. One way of looking at this, I suppose is to say, that this is really the experience and views of these various countries and the ministers with respect to preparing their countries for the 21st century in, as I said, an era of enormous change and chronic unemployment. There will be focus on training and educating workers; expanding economies; fiscal responsibility; regulatory simplification; open markets; increase in competitiveness, improving the functions of labor markets.

There obviously are some very deeply controversial issues within the context of that framework. There are very different views, in some respects, on trade. There are some very different views on labor mobility. There are very different experiences in these different countries. And all of this, I'm sure, will be discussed at length in this conference.

It is a uniquely interdisciplinary conference. There will be four substantive areas discussed, each one of which will be led by an American Cabinet Secretary. The world employment problem will be led by Laura Tyson. It will be an overview of world unemployment. Creating employment opportunities in a global economy, which will be a discussion of macroeconomic issues and trade, will be led by Lloyd Bentsen. Technology innovation in the private sector, the role of technology, small business and other microeconomic aspects of job creation will be led by Ron Brown. And labor markets, investment in human capital and social safety net will be a discussion led by Bob Rice. And the structure will be a Cabinet Secretary, and then there will be presentations by various of the other ministers, and then a free-form discussion.

As to the format of the whole conference itself, the President will kick off the conference on Monday morning, and he will have a speech which, I think, will give you -- which will present to American public -- to the world -- a very good sense of how he thinks about the economic issues in this era of great change and unemployment -- although our unemployment situation, as you know, is a lot better, but, nevertheless, in this period of great change with respect to the employment issues that we do all share in common. The conference session themselves will be closed to the press and the public, which is G-7 practice and is the way the ministers wanted to

do it. On the other hand, there will be frequent briefing opportunities.

At the end of the entire conference, there will be a chairman's statement that will sum up -- it won't be a communique, but will be a summary of the deliberations of the conference.

Q How will we be able to tell it is not a communique?

MR. RUBIN: Because we will label it chairman's statement, not communique. Communique would be something to negotiate out by everybody, and was, in effect, a joint statement with respect to whatever was going on. This will be something that, while it will be discussed amongst everybody, will, nevertheless, be something that will be put together by the person who is delivering it.

Q the President?

MR. RUBIN: No, no, it will be the Secretary of the Treasury Lloyd Bentsen.

Okay. One final point. There was a question of where we should hold this conference, and the decision was made to hold it in Detroit because we felt that Detroit represented -- it was a very good example -- what?

Q No, I said because it was John Dingell's state.

MR. RUBIN: No, Rita. We had a very -- no, we had a solid, substantive base for that decision, which was that we wanted to find someplace that exemplified a dynamic approach to a changing world and an industry that really has turned itself around, based on facing change and keeping ahead of the curve and technology, highperformance workplace, and all of the other things the President believes are very much part of how you are competitive in the modern world and what he believes are the answers for this entire world.

The final closing comment is very much our belief -- and I think you'll see this reflected in the President's speech -- that economics on a worldwide base is not a zero-sum game, and that if all the nations of the world adjust to change by trying to keep ahead of the curve instead of trying to preserve the status quo, then that will be better for all of us. And that, really, all of us are tied together in this world, and if one country does better, it's better for not only the entire G-7, but for the entire world.

You have with you, I think, an agenda. You also have a fact sheet which, hopefully, will help you with respect to what's actually going to go on, who's going to do what. If there are press questions, we have a capability for answering them. With respect to logistics, David Lane, who has done a lot of logistics, would be delighted to tell us who that's going to be. If people have questions about press logistics, who do they ask ? Okay, Ginny will take care of that.

And with that, I'd be delighted to respond to anything that you'd like.

Q Is the President prepared to say to some of these G-7 countries that they have to deal with the social safety nets in their countries that have really contributed to their high unemployment rates? Is he willing to take that on in the Motor City and --

MR. RUBIN: Well, we're in the process of drafting his speech right now, so I don't want to foreshadow his speech. But I do think it's fair to say that the speech will be focused on the kind of

forward-looking approach that you know the President has taken to the economic issues. And I think he will talk a fair bit about change, the need to keep ahead of the curve and to put in place policies that make change your friend, not your enemy.

Q Aside from that, do you think that unemployment can be addressed in those countries as long as they have the same kind of social safety net structured into their economies?

MR. RUBIN: I think there is a lot of -- Andrea, my impression -- not impression, I'm quite sure this is correct -- that there's a lot of discussion in Europe now about that very question. And I think that we've taken a different approach. Our belief is that you need to have mobility, you need to have a structure that allows for change. And then as will be evidenced by the legislation that Bob Reich is going to introduce tomorrow, you need to have transition programs so that people who are affected get transitioned back into the mainstream very quickly to continue to be effectively employed in a changing economy.

That certainly is our approach. There are people who feel somewhat differently about that in the world economy. I think that that will be one of the major things that will be discussed at this conference.

Q How does this conference translate into meaning for the lives of most Americans? I mean, what kind of impact will it have on their jobs and their futures?

MR. RUBIN: I think the best -- I think in two respects -- well, actually, it could be a number of respects. It depends on what happens -- not at this conference, but, more generally, over time. You know, as much as people may be occupied in all sorts of other issues around this town, the fact is that there is an enormously intense ongoing focus on these economic issues in the White House and in the administration in general -- in the agencies all working together as a team. And the more that we can get is grist for our mill for thinking, presumably, the better policy decisions we're going to come up with. And that may sound a little bit academic, but it's true. And I think that's one way.

Number two, I think we have an enormous stake in Europe and Japan recovering. And, if -- not this conference, but the processes that are going on and the kinds of questions that Andrea raised a moment ago -- as these things are reexamined in Europe --and I think there are changes taking place over there, now -- if this contributes to that process and, therefore, helps Europe come back sooner, that's very much in our interest because that will increase exports and so forth.

Q Will there be any bilateral side discussions or will the U.S. and Japan talk about their trade dispute?

MR. RUBIN: We have no intention -- the answer to the question is no. I mean, it could conceivably happen, I suppose, but certainly is not planned. And I would think it is exceedingly unlikely.

QQ From the U.S. standpoint, hasn't a lot of the urgency for this meeting diminished since the President first conceived of it before the Tokyo meeting, with the unemployment numbers looking a lot better and the economy picking up?

MR.RUBIN: I don't really think so because I think the President has had two focuses -- in fact, I know he has -- two focuses throughout this period. One is that we needed to get growth going quickly. And I really do believe that we have done -- I think that that certainly has happened, and I believe that his policies

have had a major role to play in that. But secondly, he is enormously focused on getting this country back on the right track for the long term -- education, training, all the things he thinks needs to be done if we're going to be competitive in the years ahead.

You know, there was an article in The New York Times --I don't know, maybe three months ago or something -- on the front page saying 90 million Americans are uneducated. It was a report of a study saying 90 million Americans are uneducated for a modern economy -- well, you look at our inner cities. And there is a tremendous focus around here on how do we -- what do we do now to try to make things better five and 10 years from now. So, no, I think it is every bit as relevant.

Q Do you see Europe and Japan as possibly models, conservative guides for how to come up with policy for the U.S. on those areas?

MR. RUBIN: I think there are areas in which practices in Europe and Japan are perhaps less effective than ours. But I think there are other areas in which they've done a very good job. There are training and education programs throughout Europe and Japan that we could learn a lot from.

Q Isn't the trade tension with Japan going to hover over this conference in the sense that one of the best ways to create jobs in the United States and Europe would be for Japan to open up its markets to greater imports?

MR. RUBIN: Well, as you know, we believe very strongly that the trade situation with Japan needs to be resolved and, hopefully and presumably, it will be. But I don't think it's going to dominate this conference. I think this conference actually will be very interesting. I really do. You know, if you take day to day events, it's not what this conference is about. But if you take the things that are really on these ministers' minds and I know that we are thinking about all the time, and they really are the framework within which -- both substantive and political -- framework within which all of these decisions they make are made, that's what this conference is about. Clearly, there is a bit of an unresolved problem with Japan over trade, and it wouldn't surprise if that arose at this meeting. But I don't think it will dominate it, no.

Q What is politically at stake if a large part of the OECD community, industrialized Western countries, are unable to respond fast enough to this chronic rise in unemployment?

MR. RUBIN: Oh, well, I'm no great expert on political science, but let me say this: I think there is an enormous -- I think the world has an enormous stake in the countries of the Western world -- the countries of the G-7 being able to solve this problem because chronic unemployment for long enough, one could guess, might have considerably unsettling social effects. So I think there's not only an economic stake, but a tremendous social and political stake.

Q How about the risk of political radicalization and things like that?

MR. RUBIN: Yes, that's what I mean. That's why I think it's very important, not only for economic but for other reasons that the countries of the G-7 figure out how to address this in a way that's effective.

Q Pardon me if this question has already been asked, but since the G-7 finance ministers and the Central Bank governors had a meeting about 10 days ago, would it be fair to conclude that this is not going to be a session in which the U.S. is going to pound

on the table for Germany to lower their interest rates, and Japan to enact more tax cuts?

MR. RUBIN: Well, I think that in Lloyd Bentsen's session on American economics and trade, I suspect that -- let me put it this -- I suspect that the issues of each county doing what it needs to do in order to deal with its own problems in a macroeconomic area probably will come up. So it doesn't seem to me that because they've had a meeting 10 days ago that the issues won't come up again.

Q But is it going to be a dominant -- is this going to be --

MR. RUBIN: Of that session? I don't know how Lloyd plans to -- I don't know how Secretary Bentsen plans to organize his session, but I cannot -- I would guess that it will certainly be a part of that session. The Cabinet Secretaries, the four that will be leading these sessions, will be holding briefing either Thursday or Friday, I'm not sure which.

Q You don't know how Bentsen is going to do -- is the firewall that's been erected here interfering with your ability to consult with the Secretary of the Treasury? (Laughter.)

MR. RUBIN: We have outstandingly good communications, and I guess I do have a fair sense, actually, of what he plans to do. (Laughter.)

Q Other than just a day and a half of talk, what's the follow-through mechanism? I understand the administration is going to propose some task forces.

MR. RUBIN: Well, I'm not so sure about that. The purpose of this meeting is really the interchange that I discussed. If, in fact, there is some follow-up, that's a decision we haven't yet reached. We won't reach that unilaterally, that's something we have to discuss with others. The key is not some kind of a task assignment next; the key is the meeting itself, the interchange. This leads into Naples and, undoubtedly, there will be a lot of issues here that will then provide a framework for further discussions in Naples.

I think what you really have under -- this was not my idea, somebody else said this yesterday and I think it's right --that this is really now going to become part of an ever more intense focus amongst the G-7 nations to work with each other since we're so enormously interdependent on these kinds of issues. It will flow over. As it flowed from Tokyo to here, it will flow from here to Naples and then it will flow on to whatever follows next. There may or may not be suggestions of some task force to follow; I don't know.

Q A lot of these issues were addressed at the Little Rock Economic Conference as you all were coming in. Since being here at the White House, what policy lessons have you drawn from looking at it from this perspective that you're going to take to Detroit next week?

MR. RUBIN: Well, I think -- if I answered that personally, I think I would actually answer a little bit differently than the answer I'm about to give you. I've learned a lot, having not been in this kind of a role before. But I think actually, it's kind of interesting, if you think about what the President -- if you look at what the President feels about these issues and you look at the thrust of his views in Little Rock, I think you'll find a great deal of consistency. And the reason is he has been enormously thoughtful about these issues for a long time. He didn't come to these issues fresh. I know when I first started working with him

during the transition, these were issues he had spent years thinking about. So this was not something where he all of a sudden had to develop opinions about things that he hadn't thought about before. So I think you'll see a large measure of consistency between the approaches he took then and the approach he's talking about now -- fleshed out by the experience of a year and a quarter actually being in the White House.

Q Are you all concerned that at best you may get a labor minister from Japan and not much else as far as other ministers attending?

MR. RUBIN: The Japanese have some proceedings going on in their Diet right now. And as you know, this is a busy time in the Japanese government. And I am not sure who is going to be here from Japan. I think they are very much caught up in their own political issues at the moment. So I do not know the answer to that question. We obviously would like their full participation.

One of their ministers has contacted me and said he very much had hoped to be here, but it's not clear now given what's going on over in the Diet.

Q Is that an excuse or is that the real reason?

MR. RUBIN: I don't think so. I think it's real, Wolf. I mean, I can't put myself in other people's heads, but my impression would be that it's very much real.

Q Is the President the only leader that's going to show up?

MR. RUBIN: This was not a leaders conference. And so the view was that we really should just have ministers.

Q Who was it who called you?

MR. RUBIN: Oh, I didn't say. (Laughter.)

Q In the context of what you were just talking about with Japan, Detroit at one point was the center of really Japan bashing -- they took all -- Japan sent the cars over, took all the Detroit jobs. Should Japan feel somewhat sensitive about holding this conference in Detroit?

MR. RUBIN: No, I don't think so. I think Detroit actually is an example of something a little bit different -- an example of people who, while they may or may not have engaged in Japan bashing, I don't know -- but whatever it is they did externally, what they did internally was to get their house in order. So they now are competitive on a world basis, which means they have recaptured domestic markets, as you know. Their market share has gone up substantially. And they're capturing a larger share of the markets abroad. They've increased exports. So whatever they may have said on the question of whether or not they engaged in Japan bashing -- what they really are is a good example of a industry that didn't blame outsiders -- well, they may have blamed outsiders, but -- much more importantly they got their house in order. And that's the way you get competitive -- not by blaming somebody else, but getting your own house in order.

Q Are there any plans for any working tours at auto plants or any other places in Detroit.

MR. RUBIN: What are we saying on that? We're going to release the President's schedule shortly, which will be responsive to that.

Q The expectation on both sides of the Atlantic are somewhat different as far as the summit is concerned. You are taking the position we are talking about let's find out what we are able to do, and some governments in Europe are hoping to get some kind of cover, alibi, out of it to make -- understand their internal discussion, which kind of structural change should take place. Are they getting that kind of cover?

MR. RUBIN: Well, you're going to have, I hope, very free and candid discussions, and different people may choose to make different uses of it. I can't speak to that.

Q Just to follow again on the macroeconomic question. Do you anticipate that this will be a negotiating session with the U.S. --


Q and the Germans and the Japanese?

MR. RUBIN: I'm sorry -- if that was the thrust of the question, it will be a discussion session, and I would guess those issues would be very much a part of the discussion. But this will absolutely not be a negotiating session on any subject.

We thank you, and we look forward to seeing you in Detroit.

END2:03 P.M. EST