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Office of the Press Secretary

For Immediate Release March 14, 1995
                             PRESS BRIEFING
                             BY MIKE MCCURRY

The Briefing Room

2:00 P.M. EST

MR. MCCURRY: Many of you might be expecting a statement from the President on the application that's been filed by the Attorney General. I don't have that because Secretary Cisneros, it's my understanding, will have a press conference at 3:00 p.m. So we'll have something for you immediately upon its conclusion.

I do want to draw attention to two statements that we have issued today because some of you have been asking about those. The first is a statement concerning the Religious Freedom Restoration Act, the case that -- the Federal District Court yesterday held that the Religious Freedom Restoration Act is unconstitutional. The President, as many of you know, strongly supported the adoption of that act which he signed in 1993. This administration is committed to the act's full implementation in order to protect the religious liberties of all Americans, and will continue to defend its constitutionality in the courts. The Solicitor General indicated today that we will join in the appeal from the District Court decision. We've got a longer statement on that.

And then on the executive order involving oil sales to Iran, I think you know the President announced today that he will shortly sign an executive order that will prohibit U.S. persons from entering into contracts for the financing or the overall supervision and management of the development of petroleum resources from Iran. We're issuing that order pursuant to our overall policy of trying to contain and isolate Iran as it continues to sponsor terrorism, as it continues to undermine the Middle East peace process, as it pursues weapons of mass destruction and the means of delivering those weapons of mass destruction. And we've worked energetically to try to press our arguments on the government of Iran that it should cease such unacceptable behavior.

To that end, we've worked with allied governments, others, to raise our concerns to encourage them to take some of the same steps that we have taken. And we will now also work to limit Iran's ability to add to its economic potential by opposing this type of expansion of its oil development capability. We need to send a very clear and unambiguous signal to Iran: There cannot be normal relations until Iran stops this type of unacceptable behavior in the world.

Q The statutory authority on that -- what's the statutory authority on that?

MR. MCCURRY: Well, the President's acting consistent to a variety of statutes; not only the Export Administration Act, he's acting pursuant to authority to regulate commerce under the 1992 Iraq-Iran Nonproliferation Act. And the specific statutes -- Calvin, we need to get the specific cote on the --

MR. MITCHELL: International Emergency Economic Powers Act.

MR. MCCURRY: Yes, that's right. International Economic Emergency Powers Act.

Q Passed when? When was that passed?

MR. MCCURRY: Do we have the cite on that?

Q Can you get the language, too?

MR. MCCURRY: Yes, we can have that available. There is, by the way, a briefing -- Under Secretary of State Peter Tarnoff and Deputy Secretary of Energy Bill White are briefing over at the Energy Department this afternoon to provide some additional background material on that, too.

Q Still there were no laws prohibiting what Conoco did. Do you think that the statute, whether D'Amato's or not, is necessary?

MR. MCCURRY: Well, we understand the motives and the goals of Senator D'Amato's legislation. We'll be looking at it carefully. We've not -- the administration has not taken a position on that legislation. But we are acting today -- the President is acting consistent with his own statutory authority to restrict the scope of economic activity that can add to the economic potential of Iran.

Q And if I can just follow up, this applies only -- does this apply only to the Conoco-Iran deal, or does it apply to other oil companies doing business with other countries that have been listed as terrorist states? There's some oil companies, or at least one that is doing business with Libya, for example.

MR. MCCURRY: Well, this specific executive order will regulate the development of oil resources as it pertains to Iran. Its immediate effect is on the transaction that Conoco was contemplating and had under consideration. There could conceivably be or could have been other types of transactions that might be affected by this, but individual oil companies would have to address themselves to that. We are -- in the immediate near future, this is the specific transaction that's most directly affected by the President's executive order.

Q Are you looking at other countries' dealings?

MR. MCCURRY: Well, this is specifically about Iran. We have a variety of other measures in place that help us contain other state sponsors of terrorism, other states that we consider so-called rogue states.

Q Why wasn't the step taken earlier? Conoco says that it kept State informed of this as it went along.

MR. MCCURRY: Well, we, only in recent days, became fully aware of the nature of the transaction, and there has been a review within the administration ongoing on how to best execute our own policy of containment for Iran. So this is a step that the President felt appropriate to take as we looked how to both isolate Iran economically, and then, importantly, to add credibility to our own arguments as we go out to other international friends in the world community and make the case that they, too, should work to isolate states like Iran that are sponsors of terrorism. This, in a sense, buttresses the argument we make when we approach them bilaterally and say you should join with us and also work to restrict the scope of Iran's economic activity.

Q Do you think Conoco withheld information from State and you didn't find out enough or that you didn't have any way of knowing before this?

MR. MCCURRY: Well, they informed us -- they have informed us of the status of the deal, but it's my understanding that it is only last week that they indicated that they were bringing the deal to a conclusion.

Q Well, did anybody ever hint to them that while they were keeping you abreast of this that this might not be such a hot idea?

MR. MCCURRY: Absolutely. As I indicated when this matter first arose, we told them that our own policy is to isolate and try to attempt to restrict Iran's capacity to do the things that we find objectionable in the world. They were well aware of that policy as they --

Q They were fully warned then that this might well happen?

MR. MCCURRY: Well, I wouldn't suggest that. I would say that they were fully aware of our policy which is one of isolating Iran economically and recommending that others do likewise.

Q There are some people in the oil business who said today that Conoco didn't offer any better deal than the other three European companies. And the reason they got it is that Iran wanted to improve its relations with the United States and that it was a signal that it wanted to open up. Why is it -- in light of that, why is it a good thing to isolate Iran economically and a bad thing to do the same thing to China?

MR. MCCURRY: Well, I'm not -- it's comparing apples to oranges. I mean, there are different policies that we pursue in furtherance of our policies depending on the country. We've got -- the pattern of behavior that Iran has now exhibited in the world, especially in the volatile region like the Middle East, especially in their support of terrorism, represents a marked difference from other states that we might also attempt to pressure economically.

Q And just a follow-up to that -- why is this kind of development deal bad but still U.S. companies are allowed to buy and sell Iranian oil so long as they don't import it into the U.S.?

MR. MCCURRY: Well, that's so-called third party transactions. This deal would be markedly different because it would go beyond the existing oil-producing capacity of Iran , moving to offshore reserves, which would substantially increase over the long- term the capacity of Iran to attract capital, to attract investment, to build up its economic activities. So this would represent a substantial new capacity for oil production by Iran> And that's, among other reasons, why the President felt that it would dangerously add to their economic capacity to do the things that we find objectionable in the world community.

Q Mike, I know you can't comment specifically, you say, on the Justice Department order, but can you tell us if the President still has faith in him -- in Cisneros -- as Secretary?

MR. MCCURRY: Well, he'll have a statement that will make that very, very clear shortly. But we do want to in fairness give Secretary Cisneros an opportunity to speak.

Q Will you come out and brief after that again then?

MR. MCCURRY: If there is popular demand for that, I will consider it.

Q Oh, yes. Yes.

Q Here, here.


Q If we're not going to see him, we want to see you, please.

Q We'd like to see him.

MR. MCCURRY: Oh, thank you. I'll take that as a compliment.

Q We'd love to see the President.

Q Back on the executive order. Did the President meet with his foreign policy advisors last night after he got back from golf on this issue?

MR. MCCURRY: No, he had discussed it with National Security Advisor Tony Lake and perhaps others earlier in the day yesterday. He then received a memo late in the day with a recommendation which he reviewed. And we got the check mark on the box sometime in the middle of the morning today.

Q Do you know if the Bronfman family contacted the White House about this, had any influence in the President's thinking on this?

MR. MCCURRY: I'm not aware of any contact by the family, no.

Q And also, Mike, back to Maura's question about American oil companies buying Iranian oil. We're about to buy about a quarter of Iran's oil. Is the President concerned that we're -- that American companies are producing a lot of revenue for this government that we think is a sponsor of terrorism?

MR. MCCURRY: That is their economic activity generally and how their oil revenues affects their ability to do things that we find objectionable, both in terms of proliferation, sponsorship of terrorism, attempts to disrupt the Middle East peace process, other things that they do that are objectionable in the eyes of the world community is a source of concern. And as our statement today indicates, there is an ongoing review of their economic activity. But the steps identified today are specifically designed to prohibit contracts related to financing overall supervision or adding to the existing development of petroleum resources in Iran.

Q You say that you're trying to convince other countries not to do business with Iran, but you're not going to do anything to the American companies that are still doing business?

MR. MCCURRY: We have taken -- I mean, there is a great deal of economic restriction on activity involving Iran already. We bar imports of certain -- most goods and products coming from Iran; we bar certain sensitive technologies pursuant to the Export Administration Act. So we have a number of restrictions on economic activity and commerce that exist already. And specifically in the oil and petroleum sector, we've taken this step today and we believe that that will add to our credibility when we make that argument to other countries.

Q I wondered if you could explain the failure of the President to get through on the telephone to British Prime Minister John Major on Saturday. I believe Downing Street is now saying Mr. Major was too busy to take his call.

MR. MCCURRY: I don't believe that's at all what they say. I think they correctly pointed out that he's traveling abroad.

Q He was in London at the time the call was made.

MR. MCCURRY: Well, he was due to depart shortly for the Middle East.

Q Mike, isn't this situation with Cisneros another case of overlooking a vetting problem in the transition?

MR. MCCURRY: I don't believe that is the case, but I think that the facts as they've been presented by the Attorney General in the application today speak exactly to the circumstances there, and I don't believe it would be appropriate to go beyond that at this point.

Q Are we to assume that the President approves of a Cabinet member paying payments to a mistress?

MR. MCCURRY: We'll have a statement later. I already said that, Ann.

Q Do you know anything about President Salinas, his whereabouts, his plans?

MR. MCCURRY: Nothing further as far as I know.

Q Is he in the U.S.?

Q Do we know if he's in the country?

MR. MCCURRY: We believe he's in the country. Customs indicated that he had come into the United States through Brownsville, and he is traveling as a private citizen. And I'm not aware of any reason why we would be tracking his movements. He's not under investigation or being sought in connection with any matter that the United States government is pursuing.

Q Are you able to tell us whether Cisneros has spoken to the President today?

MR. MCCURRY: The President has not spoken to him. He's had some contact with Deputy Chief of Staff Harold Ickes. Leon Panetta, the Chief of Staff, is traveling in California, as you know. The President was made aware of the Attorney General's filing of the application with the three-judge panel just after 1:00 p.m. today by Judge Mikva who briefed him.

Q Mike, for a long time there have been lots of reports that some of the foreign Iranian oil company offices could have been used for procurement of mass weapons or other materials. To what extent did the supposed links between Iranian oil companies and purchases of weapons of mass destruction play a role with that?

MR. MCCURRY: Well, as we've indicated in our statement, we are concerned about Iran's efforts to acquire weapons of mass destruction and the means to deliver them. But I'm not aware of any specific connection to any oil companies in that regard.

Q Beyond the Bronfman family, did any Bronfman interest ask the White House to intervene, or did, after the deal was announced, did Conoco, feeling burned, ask the White House to issue the order to let them off the hook?

MR. MCCURRY: Well, we've had, as we've indicated, we had ongoing contacts with Conoco and we appreciate their cooperativeness in addressing our concerns regarding this transaction. As to the other, I mean, that is a large family with large financial holdings, and I don't know if it would be possible to answer that question. We'll try if there's --

Q Did Conoco ask you to sign the order as a way of -- as an out for them?

MR. MCCURRY: Well, as I say, we've been working cooperatively with Conoco in an effort to address the matter.

Q Is that a yes?

MR. MCCURRY: No, that was the answer I gave.

Q Mike, what do you mean by Conoco's cooperation on this matter?

MR. MCCURRY: Well, we have had discussions with them to make them aware of our concerns as a matter of policy about transactions of this nature and how they might impact on Iran's ability to do the things that we find objectionable.

Q How could they misunderstand the White House so bad? How could they have so misunderstood your concerns to proceed with the deal?

MR. MCCURRY: Well, they may have -- I don't know. You'd have to ask that question of Conoco. They may have thought that by doing the transaction or principally through a subsidiary that they somehow or another were not running afoul of our concerns, but I think we made ourselves clear to them.

Q Did you tell them, no, don't do it?

MR. MCCURRY: We just did.

Q But before that?

Q Since Conoco has already signed the deal, does the President's -- does the President have the power retroactively to block the deal? As I understand the order, it simply prevents U.S. citizens from signing. Hasn't the signing already taken place?

MR. MCCURRY: The signing of the executive order?

Q No, the signing of the deal. Conoco and Iran.

MR. MCCURRY: Well, it has taken place, but we have indicated -- I mean, Conoco will have to speak for itself, but we -- they have indicated to us that they would terminate the project in response to an executive order of this nature.

Q So the order doesn't apply retroactively, but Conoco you're saying is taking this step voluntarily?

MR. MCCURRY: I believe the company will be in a position to address itself in more detail.

Q Mike, in a story that's somewhat related -- when King Hassan of Morocco comes here tomorrow, he's indicated in a couple of interviews that he's going to ask the President to reconsider the effect of sanctions on Iraq and Libya. How will the President respond to that? Can you see him reconsidering those in any way?

MR. MCCURRY: We will entertain the arguments of the King, but our views on those matters are very, very well-known, and we believe, particularly in regard to the Lockerbie bombing, that the fugitives from justice need to be brought to trial in the United Kingdom or the United States, and that Libya knows that and that the measures in place to pressure them accordingly should remain in place until those terms of the Security Council resolutions are met.

Q Are there any plans by the President or the administration to go beyond this pending executive order and to try and role back arrangements that U.S. oil companies have that buy Iranian oil and sell it elsewhere?

MR. MCCURRY: As we indicated today -- I don't want to preview any specific measures, but we do indicate today, as our statement says, that we will continue to review economic measures with respect to Iran that might bring additional pressure to bear on it.

Q Well, is this one area that you are reviewing -- purchases of Iranian oil by U.S. companies?

MR. MCCURRY: There are a number of areas; I wouldn't want to incorrectly speculate that one might receive more attention than others. But this would be a fairly obvious one, yes.

Q If I could also ask, on the pending rescission bill that the President was hitting yesterday and today, what is to prevent you from obligating or spending all this money before the bill can be enacted? These are FY'95 funds.

MR. MCCURRY: Well, among other things, the directive that the Director of the Office of Management and Budget has given to all Cabinet agencies specifically asking them to comply with the normal payouts and expenditures as they would in normal business practices. You might want to check with them. That went out I think sometime last week.

Q We're about halfway through this current fiscal year. How much money can this legislation, even if it were to pass fairly quickly House and Senate, still reach?

MR. MCCURRY: This rescission package?

Q Yes -- you've got a $1.7 billion rescission --

MR. MCCURRY: Oh, I see --

Q but it's money that must already be flowing through the pipeline.

MR. MCCURRY: I don't know the answer to that. It would be a good question for OMB because Director Rivlin has instructed agencies that they should not somehow or other adjust their expenditure patterns anticipating rescissions that the administration finds objectionable.

Q Mike, as Peter indicates, there may be some things on Hassan's mind when he arrives here tomorrow. Does the United States have anything on its agenda that it plans to raise with him specifically?

MR. MCCURRY: Yes, we expect a number of things. One of them surely will be the results of Secretary Christopher's just concluded travels in the Middle East. The Secretary just announced a short while ago a resumption of dialogue in the Syrian-Israeli tracks, so I'm sure that the President and the King will review the full scope of things related to the Middle East peace process. We expect that ways in which the international community can nurture the peace process through economic development in the region will be a key part of the discussion. The King was host to the Casablanca Conference last year that marked many advances in that direction, and has been, within the region, a leading proponent of economic support for the peace process. And I'm sure that the President will want to review those developments.

I expect they'll also talk about the secondary and tertiary aspects of the boycott against Israel and the steps that are now underway, most recently by the Arab League, among others, in the Gulf Cooperation Council, to terminate secondary and tertiary aspects of the boycott. They will also address -- on our agenda will be the nonproliferation treaty, which has been one that we've placed regularly on a lot of the President's bilateral meetings and other subjects that might arise, which we will brief on following their meeting.

Q Mike, when did Conoco tell you -- tell the White House that it was going to terminate the deal?

MR. MCCURRY: I'm not sure when they did that. They informed us of the status of the deal last week. I don't know when they indicated to us that they would terminate based on an executive order.

Q You're sure they did, though?

MR. MCCURRY: I'm sure they did.

Q It's already happened?

MR. MCCURRY: I don't know whether they have, in fact, terminated the deal, but they've indicated to us they would likely do that in response to an executive order of this nature.

Q But presumably before yesterday.

MR. MCCURRY: Presumably, we've had conversations with Conoco for some time, as we've indicated.

Q Before the options memo went to the President.

MR. MCCURRY: I think their response and how they might deal with our understanding and our policy has been under consideration for some time.

Q So the idea of an executive order was perhaps worked out with Conoco?

MR. MCCURRY: I wasn't part of those discussions. I can check further on it, but I was not part of those discussions.

Q Mike, the appointment of a special prosecutor seems to have enormous impact; obviously, Espy has resigned as a result of the inquiry and there's every indication from the scheduling this afternoon that Cisneros may resign as a result of these decisions.

MR. MCCURRY: I'm not -- I'll deny the premise of your question before you go any further. But what's the question?

Q He's not going to resign?

MR. MCCURRY: We'll wait and hear from the Secretary when he speaks.

Q So you're just not affirming it?

MR. MCCURRY: As of 20 minutes ago, I'm not certain what he will be saying.

Q So you can't deny the premise?

MR. MCCURRY: I can't confirm or deny; I don't have any clue what he's going to say. The Secretary has talked --

Q You're simply acting out of an abundance of caution.

MR. MCCURRY: No, the Secretary has talked to the Deputy Chief of Staff, and the Secretary is now discussing matters with his counsel, if I understand it correctly.

Q My question is about the Attorney General and her decisions in these respects, the fact that these decisions now have enormous impact on the Cabinet -- there are two other decisions pending before her on Pena and Brown. Does the President have faith in her judgment on these issues?

MR. MCCURRY: The President has faith that she looks at the questions of law that arise. In this case, she has found a very narrow subject of law materiality as it affects specific allegations she reviews in the statement, and she has proposed as a scope of an investigation, a very narrow question to be examined. That is within her responsibilities as Attorney General. There is a very low threshold by design in the appointment of independent counsels, and for matters that the President has spoken to before.

Q That sounds like a ringing endorsement --

Q Did Secretary Cisneros talk with the White House Counsel?

MR. MCCURRY: Not to my knowledge, no. The White House Counsel was briefed by the Deputy Attorney General around 12:15 p.m. today.

Q The findings speaks of the low, narrow threshold of materiality -- but then the allegations and the differences between the amounts of money reported and the amounts of money which actually changed hands are rather significant. Why such a narrow threshold?

MR. MCCURRY: I missed the point of your question.

Q You cited the narrow threshold of materiality on which the Attorney General is suggesting this be decided.


Q And yet, the differences between what the Secretary reportedly told investigators and what he actually spent seem to be quite major.

MR. MCCURRY: I can't -- you apparently want me to come back and comment further on this later, which I've indicated willingness to do.

Q Why is the level of falsehood perhaps only barely material?

MR. MCCURRY: I didn't say that. I said that there was a very specific issue of materiality that the Attorney General had looked at, as her statement makes clear.

Q On affirmative action -- is Willy Brown here today, or was he here yesterday, or is he here again today?

Q He i here again today, isn't he?

MR. MCCURRY: I think he was here today. He was here yesterday, and he may be here today. I don't know. We'll run that down. Run that down and I'll check it out.

Q And can you just describe why he's here and how the review is going and whether the President is going to say something before the 24th?

MR. MCCURRY: No, he's here -- I wouldn't say specifically in connection with that issue. He's here under -- had a number of things under discussion yesterday with officials here at the White House related to California, related to policy. I believe affirmative action may have come up, but he had a range of things that you could expect the Speaker of the Assembly would have on his mind as he comes to Washington.

Q Should we expect some presidential comments on this subject before next Friday?

MR. MCCURRY: What subject?

Q Affirmative action.

MR. MCCURRY: That's entirely unclear at this point.

Q Mike, what was the President's agenda with Trent Lott at lunch today? What did they talk about?

MR. MCCURRY: An expansive one. But I haven't had a chance to talk to him about his lunch yet, so I don't know what they talked about.

Q Is he planning to meet with some additional members of the Senate?

MR. MCCURRY: He's been, as you know -- we've been telling you, pretty much daily -- he's been doing it at least every other day or so. At least a couple of times a week he has members of Congress down for conversation and it usually ranges across a wide variety of subjects.

Q Is he going to the Hill in connection with that? Any visits to the Hill?

MR. MCCURRY: Not that I'm aware. No plans.

Q the President going to Haiti at the end of the month. Is this administration happy with the way President Aristide is organizing his government? There's been a lot of complaints out of Haiti that --

MR. MCCURRY: Well, President Aristide is making significant progress towards economic liberalization, political reform and revitalizing both the infrastructure and the economy of Haiti. And we've had numerous U.S. officials down there in recent weeks working with them. The President will have an opportunity to review those matters with President Aristide when he's in Haiti on the 31st, but we are there primarily to celebrate the extraordinary job that's been done by U.S. Armed Forces as part of the multinational force which will pass the baton that day to the U.N. mission in Haiti.

Q On Conoco, Mike, do you know whether the executive order enables Conoco to break this contract without any legal ramifications?

MR. MCCURRY: The executive order is being drafted now by lawyers to address some technical issues, and I haven't seen the final wording of the executive order. There's nothing in the -- I'm not aware of anything that addresses that specifically in the language of the policy action taken by the President.

Q Do you know when he'll sign --

MR. MCCURRY: They expect they may have it completed -- the drafting may be complete within a day or two.

THE PRESS: Thank you.

END 2:24 P.M. EST