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Office of the Press Secretary

For Immediate Release February 13, 1996
                             PRESS BRIEFING
                             BY MIKE MCCURRY

The Briefing Room

1:07 P.M. EST

MR. MCCURRY: What would you all like to talk about today?

Q What is the message you take out of Iowa?

MR. MCCURRY: That the Democratic Party is united and enthusiastic behind our President. The Iowa caucuses were, for the President, very gratifying. I'm sure you all saw today the Des Moines Register headline, "Clinton Visit Inspires Democrats To Turnout." Over 50,000 did even though the President, of course, was unopposed. The President did pretty well squeak by, got 99.8 percent of the vote and all of the delegates. He was very encouraged by --

Q Just like in the Soviet Union. (Laughter.)

MR. MCCURRY: The big difference, of course, Helen, is that there was a contest in the other political party which --

Q Aren't you short-changing yourself? The New York Times says you got 90,000 people.

MR. MCCURRY: No, I believe the turnout when they were finished the count today, my understanding is the Iowa Democratic Party will be somewhat in excess of 50,000. That's considerably more than the party had prepared for; they were looking for a turnout around 30,000. And, of course, it's a marked contrast to the turnout on the Republican side, which was much lower than Iowa Republican Party officials had projected. They were disappointed by a turnout that barely reached 100,000. And as the Iowa State Republican Chairman said in an interview today, he thought the turnout was due to the negative tone of the Republican campaign, the fact that there were so many negative ads and the fact that the Republican candidates had failed to inspire the voters -- that the Republican candidates were going to have to address issues that the American people care about.

The President is confident on his own behalf that he's been trying to address those issues that are important to the American people, and we're delighted with the enthusiastic response of Democrats in Iowa last evening.

Q Mike, what's the level of fear in the White House about a possible Alexander nomination?

MR. MCCURRY: Alexander, Alexander. Oh, Lamar. (Laughter.)

Q Lamar.

MR. MCCURRY: Lamar! There has not been, that I am aware of, any detailed discussion of the Republican candidates or any attempt to understand the chemistry of their race. The Republicans will have to sort out for their own how their nomination race will proceed.

Q Mike, Buchanan seems to have captured the imagination of blue-collar type workers, at least with his economic message of protectionism and "America first" and the worries of GATT and NAFTA. Is that a concern for you all, and how do you -- that's kind of your base.

MR. MCCURRY: We will resist such a broad, expansive, sweeping interpretation of history based on a small fraction of voters in the Republican primary process.

Q So you have no concern about that he's eating away into the traditional base of the Democrats?

MR. MCCURRY: There's no evidence that that's true, A, based on one event in Iowa last evening; and, secondly, it will be a long time before we know really how this field of candidates sorts out. The Republicans have clearly got a lot of work to do to sort out amongst themselves who will be the standard-bearer for their party and who, in fact, does speak for segments of the electorate. And we'll let them do that on their own.

Q Felix Rohatyn told us this morning that he's decided that he doesn't want the White House to fight on his behalf for the vice chairmanship of the Fed. Can you tell me what the status of that is? Has the letter actually gone to the President and do you guys consider it dead?

MR. MCCURRY: Well, the President, who very much admired the work that Felix Rohatyn has done over the years to bring sound fiscal management to the affairs of the nation and to the affairs of this nation's largest city, and who the President admires for his steadfast advocacy of a balanced budget, is very disappointed that we've reached a point in Washington D.C. where a nomination so obviously qualified won't be able to proceed. And we will respect Mr. Rohatyn's wishes. The President will review this matter in the coming days and we will consider the question both of Fed vacancies and the issue of the current tenure of the Chairman.

Q So it's dead?

MR. MCCURRY: I don't want to say that because he was only under consideration. He was never formally recommended, and someone who has served his nation so well and who ought properly to be available to serve this nation, deserves a little better epitaph than that one.

Q -- politics, what do you mean by that, that derailed his --

MR. MCCURRY: That if you look at the broad expanse of his advocacy of balanced budgets, of sound fiscal policy, of sound financial management, Felix Rohatyn has been a voice for common sense for moderation, indeed, in many cases a conservative voice for how this nation's fiscal affairs should be managed. And the only grounds for attacking him are based mostly, the White House believes, on politics, rather than a serious review and judgment of his credentials, his experience, his background and his views.

The one issue where you -- the only issue in which you could argue that he has some different philosophy than the predominant view of the Republican majority in Congress is on the question of infrastructure and how you finance it and the importance it plays in economic growth. We don't think that the very partisan comments made by Mr. Rohatyn in the Senate by certain Republican senators are based on roads, sewers and bridges. We think it has a lot more to do with politics in a very political season.

Q There are reports that Secretary Rubin opposed him.

MR. MCCURRY: No, I'm not aware that that is true. I think there was a very --

Q Or had some difference.

MR. MCCURRY: -- great deal of respect, great deal of affection for Felix Rohatyn. And the fact that he was under consideration indicates that he was highly regarded by the National Economic Council, including the Secretary of the Treasury.

Q Have a list of nominees gone to the President yet?

MR. MCCURRY: No. The President has not met with his economic advisers to receive any formal recommendation related to the Fed vacancies. I believe he will do so in the coming days, and we will report back on any decision-making that the President makes.

Q Why does he keep appointing Republicans, like Greenspan --

MR. MCCURRY: Why does --

Q -- for the top jobs of the Fed?

MR. MCCURRY: Well, the President has been appointing Democrats, but we are also dealing with the fact that there is a very partisan atmosphere in Washington, and the Republicans control the Senate where many of these nominations must achieve confirmation. It was quite clear from our careful review and clear of the review that Mr. Rohatyn himself made. He's well-known to senior members of the United States Senate on both sides of the aisle -- but it's clear that this was yet again a nomination that would likely fall to politics rather than be evaluated on the merits.

Q Some analysts have put forward the view that perhaps it would be difficult, if not impossible, to get a nominee approved before the presidential election. Do you agree with that?

MR. MCCURRY: Certainly when someone with the credentials and experience of Mr. Rohatyn is led off the path by politics it does raise that question.

Q Is the President committed now to renominating Greenspan?

MR. MCCURRY: He has not addressed that question and not received the formal recommendation from his advisors.

Q Is there a time frame when he has to make a decision?

MR. MCCURRY: As I indicated, in the coming days.

Q Mike, speaking of politics, there are some people who are suggesting that one of the reasons the President signed this executive order today is because of concern over the political -- over politics and immigration. And I just wondered if you could comment on that, especially because they say that what needed to happen first is some kind of easy identification system, that without that verification there will be no successful enforcement.

MR. MCCURRY: Well, that goes to a particular issue of enforcement that would best be addressed by Immigration and Naturalization Service of the Justice Department. I'll say there's no grounds to suggest that this is an executive order based on politics. This President has consistently said he would do a better job of protecting our borders and making sure that immigration, when it occurs to the United States, occurs in a legal fashion. This is a tool that will now be available, a fairly convenient one and one that is easy to administer that will ensure that federal contractors live up to the letter of the law.

Q Does this tool apply to just companies or to individuals? Can somebody just change his shingle?

MR. MCCURRY: This has to -- the executive order he signs today relates to federal contracts that go typically to companies that are involved most often in the construction business, but there are other federal contractors that would apply. It's not designed to apply to individuals, and it's not designed to put a burden private sector employers either. There's no -- there is a eased paperwork aspect to the executive order so that we don't put any excessive burden private sector employers. What they simply have to do is to verify that they have employed people that they know to be legally employable, legally authorized to work.

Q What's this going to do to the present law? The President points out in his message that it's already against the law.

MR. MCCURRY: It's against the law, but this applies a new sanction, which is the bar on federal contracts for a period up to a year for those who knowingly violate the law. So it really represents a new sanction against those who violate the law.

Q Mike, in the meeting today -- I'm sorry if I missed this -- is the President going to be taking part in this meeting today with Laura Tyson and Panetta on the Fed?

MR. MCCURRY: Well, the President, as I said earlier, will review this issues in the coming days.

Q But is he going to be meeting with them specifically today?

MR. MCCURRY: He may have time on the schedule today. But as I say, I expect -- there will be a series of conversations that he'll have with his economic advisors, and we'll report to you when we can on any decision-making that results from those conversations.

Q So are you expecting any announcement today?

MR. MCCURRY: I'm not expecting any announcement today. Sarah.

Q Mike, may I add to that immigration question?

MR. MCCURRY: Yes, ma'am.

Q Has it not been always impossible to enforce immigration at the Mexican border?

MR. MCCURRY: It's always been difficult, given the nature of the border and given the close relations that we have with a government that we maintain very friendly contact with. But that doesn't obviate the need to do a better job of trying to force our laws and to do what we can to prevent illegal immigration.

Q Is it not true that most of the time when they get the money to beef up the border patrol the money is taken by the Justice Department for administration more than it's put on the border?

MR. MCCURRY: Not that I am aware, but that would be a question you should probably direct to the Justice Department to make sure you get an absolutely satisfactory answer.

Q Mike, considering that over the weekend in Iowa the President several times in speeches there made a political point of the work that FEMA does and how it's important and how the fact that Tom Harkin introduce the President at one of the speeches, saying this is the man who came here during the floods and now we owe him our votes, why shouldn't the trips to Oregon and Washington and Pennsylvania later in the week be seen as political trips?

MR. MCCURRY: Well, I don't -- look, any time the President goes anywhere in an election year, my guess is many of you will evaluate the political aspect of the trip. That's a fact of life. But the important issue is what we have done for federal emergency disaster relief.

And if you look at the record of what the President has done, going back to 1993, when he toured Iowa during the floods, but all the trips since then -- at the time of the California earthquake, when he went to Georgia to review the flood damage there, when he went to California again because of flooding in Northern California, when he visited Oklahoma City in the aftermath of the Oklahoma City bombing when again the Federal Emergency Management Agency stepped in and took a leading role -- this is a response to Americans who are in need, people who are -- families who are facing the consequences of acts of God, and acts of God don't have much to do with politics.

Q Does the President think it's inappropriate for a surrogate or supporter of his to suggest some kind of quid pro quo that aid came during the disaster and now there's a political return to it.

MR. MCCURRY: I think the President, as he often does when he's speaking in front of audiences, talks about the work we've done to reinvent government. And the work that we've done to reinvent the Federal Emergency Management Agency, FEMA, is a record that the President is particularly proud of. That's an agency that was roundly castigated during prior administrations, and under James Lee Witt, or "Quick Witt," as the Atlanta Constitution called him this week, he's done a spectacular job of professionalizing that agency and doing a better job of doing what that agency is supposed to do -- to respond to disaster situations and provide needed federal relief as it properly should be provided under law.

So, does the President brag about that record? Absolutely, because it's an important part of the work he's done as President and part of a record that he's proud of.

Q Mike, he's already declared disasters in Oregon and Washington. Is he going to be bringing tomorrow or announcing any new assistance or any new help for these people?

MR. MCCURRY: He will be reviewing -- not that I have heard or am aware of because most of the federal aid that is available or the assistance that is available was triggered as a result of his disaster declarations. I also -- Mary Ellen reminds me I should add that he will be, we can say now, making a stop to Idaho as well, which is the third state that was declared a disaster, major disaster as a result of the storms that began on January 26 -- northern Idaho.

Q The check-in is in an hour. (Laughter.)

Q When is that stop?

Q Is he going to New Jersey that night?

MR. MCCURRY: It will be a long day for those of you traveling tomorrow, yes.

Q What else is new?

Q The President is often going on about stagnant wages, et cetera. I'm wondering if he's concerned that this morning the Labor Department released the wage cost -- the employment cost index at 2.9 percent for 1995, the lowest it's ever risen since they've been keeping that statistic. Is he concerned about this, what the average worker is going to think about this?

MR. MCCURRY: Although I believe that, if I'm not mistaken, that BLS data did show a rise in the benefit portion of overall compensation, so that reflects the ways in which workers are now receiving some of their compensation as a total package; in some cases, it's coming in the form of benefits as opposed to wages and salaries. Nonetheless, the President, as you know, has been deeply concerned about our ability to grow this economy in a way that produces higher incomes for American workers.

In a few moments the President is going to be spending some time with an advisory council that has looked very carefully at the question of how do you bring new computer technology into the schools of America so that you can produce highly-qualified, trained, skilled workers who are more productive who can be higher wage earners in the economy of the 21st century. That's been a principal preoccupation of this President. Wage stagnation is, arguably, now that the President did the job of addressing some of the macroeconomic problems that the country's -- the nation's economy faced when he took office in 1993, he now is concentrating on the issue of wages. And that will be a serious piece of work that will continue throughout this year and well into the second term.

Q On a related subject to that -- I think you addressed this last week -- Secretary Reich and Senator Kennedy both -- for tax incentives to corporations that invest in their workers to try and counter the wage stagnation. Is the President favoring that, studying that? What's his position on it?

MR. MCCURRY: Well, as Secretary Reich himself made clear, that is not an idea that he advanced in the context of a policy-making process, but those ideas are amongst those that will be a part of the debate within the administration as we fashion a response. Clearly, what we're doing now is doing what we can to bring higher education and higher technology into the training that the American -- that's available to the American work force. Higher technology, higher education means higher wages. That correlation has now been well-established. So that's the work -- you'll see a lot coming out of the President's State of the Union address that's focused like a laser on that point because it has to do with how you grow the economy in the long-term into the 21st century.

Q But what does he think about the Reich and Kennedy proposals?

MR. MCCURRY: Well, it's never been formally presented to him as a policy recommendation. It's an interesting idea. No one -- everyone would acknowledge that including the President, but it needs to be an interesting -- to go from an interesting idea to a policy that the President can advocate, it has to go through a review interagency and take on a little more specificity than it has currently.

Q Did Reich clear these ideas before he wrote op-ed pieces and gave speeches?

MR. MCCURRY: Well, he talked a long time ago about this. He's been very outspoken on the question of what he likes to call corporate citizenship. And the President is well aware of his thinking on that and they talk and visit on that question from time to time. But, again, I'd draw a distinction between his role, as an advocate, an engine of ideas and his role as a policymaker within the confines of the National Economic Council where ideas like that would be vetted, would be reviewed. We'd go through an interagency process and then would be recommended to the President for action by the President.

Q To get back -- because I asked you about this last week, Mike -- so, currently, Treasury and the NSC are not doing anything formally to look at the idea of tax incentives for businesses to treat their workers better?

MR. MCCURRY: Well, they're not now -- they do not have, as far as I'm aware, a formal policy process underway where they are developing recommendations for action by the President. They look at those concepts all the time. They have their experts and the economists who work for the White House and the administration examining those ideas, discussing them all the time? Because as part of the answer to the question earlier, how do you really address the issue of wage stagnation, how do you create a more productive, higher morale work force, how do you create employers working with -- in partnership with their work force, which is something the President himself addressed in the State of the Union address, as you know.

So there's a vigorous discussion of these ideas all the time within the administration, but that I would say is distinct from presenting the President with a series of options that he can then advocate in the form of either legislation or direct executive action.

Q And where is it going from here?

MR. MCCURRY: Well, it could very well go, as I say, as we go through this year and into the next term, into formal proposals that the President would make. But it's not at the point where anyone ought to be exercised right now about an immediate, near-term series of recommendations that would have to come forward.

Q Mike, isn't the President, though, in a Catch 22 situation with regard to improving either employment or wages, that every time the economy, whether stimulated by the President's policies or by other factors, becomes a bit more bullish, you've got the Fed applying the brakes. And here's the President on the verge of reappointing Greenspan. So doesn't the President face this dilemma that whatever he tries to do to improve the lot of working Americans, he's got a Federal Reserve Board that, in effect, neuters what he's trying to do?

MR. MCCURRY: The President is steadfast in requiring this administration to keep a very independent posture as it relates to the Federal Reserve Board. Nothing will change about that during the President's tenure because he believes that board has to operate independently.

As to the intersection between fiscal policy and monetary policy, I think that's a subject that is very well covered in the Economic Report of the President, which will be released tomorrow and which is available to you -- the effect of interest rates and lower interest rates. And, indeed, it's been one achievement of this administration, and we've been able to sustain growth over a long period of time with low real interest rates, low unemployment, low inflation rates. That is part of the Clinton economic record that certainly the President will talk about a lot during the coming year, but that has worked in part because we have not attempted to try to micromanage monetary policy or the Federal Reserve Board.

Q Mike, we had a question just a couple of minutes ago about the political nature of the times of achieving perceptions of other presidential activities. How concerned, if at all, are you that the political nature of the times is going to render your economic forecast --

MR. MCCURRY: I don't get the question.

Q In other words, that it will get no attention because it will be regarded as a political document and appears in a political time.

MR. MCCURRY: Well, the reputation of Dr. Stieglitz and the Council of Economic Advisors, which I don't believe even Republican economists and serious people on Capitol Hill would challenge, will stand for itself. It's a splendid piece of reporting and it will be enthusiastically embraced by the President and available to you tomorrow.

Now, economic reports of the President tend to be a snapshot of where the economy is at a given point. What voters tend to care about is more where is it going because they want to know what's going to happen to their families and their kids and that's part of the ongoing dialogue and debate that we have. But it -- this provides a snapshot and, thus, an important piece of evidence that the American people can use as they evaluate what their own economic prospects are, and that's the basis upon which they most often make decisions when it comes to campaigns.

Q Can I change the subject to China?

MR. MCCURRY: Mr. Blitzer.

Q Where is the situation as it stands right now as far as the U.S. assessment of, A, reports that China illegally transferred nuclear weapons to Pakistan; and, B, these Chinese maneuvers that are supposedly threatening Taiwan?

MR. MCCURRY: Well, no change. The administration always evaluates information available as it relates to matters of nonproliferation concern to us, and that evaluation continues.

On the second part of your question, the government of China has not announced any military exercises I am aware of. We monitor very carefully any military activity to see if it's consistent with past patterns of military training exercises that they conduct usually this time of year, and specific information on that is obviously information that we don't discuss publicly.

Q Is the President having an NSC meeting on this subject today?

MR. MCCURRY: I'm not aware that the President is having an NSC meeting on this subject today. I know that beginning January 26 when the President's principal national policy advisors met on this subject, there have been a series of meetings and reviews on the question of China and they are going to continue those discussions. They may -- the principals may be having discussions related to China today and in coming days, but I don't expect any decisions or recommendations to be formally made to the President today.

Q You said the Chinese have not announced that they've started these maneuvers. Is there any evidence, though, that the maneuvers have, in fact, started?

MR. MCCURRY: There is military activity in the region of the Straits that we monitor very carefully.

Q And how ominous or serious is that?

MR. MCCURRY: Well, it's consistent with -- in some respects, consistent with what I mentioned earlier, that there is a regular pattern, annual pattern of training activities by the PLA and other elements of the Chinese military and there is nothing that indicates to us that there is a buildup of an offensive military nature.

Q You don't consider it an attempt to intimidate Taiwan?

MR. MCCURRY: Well, as to motive and reasons for training, you would best ask the government of China. See if you can get an answer to that one.

Q Do you have their number?

MR. MCCURRY: I mean, we obviously have analysts that attempt to understand such exercises and we analyze those things, and there is a national election on Taiwan March 23rd.

Q Has China been given an ambiguous answer on what we would do if it did attack Taiwan?

MR. MCCURRY: Oh, I doubt very much, given the PRC's understanding of the Taiwan Relations Act, that they have much doubt.

Q I thought you said earlier that we were being deliberately ambiguous.

MR. MCCURRY: Well, we've not -- we've never specified the exact response consistent with the exact wording of the Taiwan Relations Act. But if you look at that act, if you look at the requirement for peaceful resolution of issues related to the Straits, it's quite clear what the view of the international community would be of any unnecessary provocation.

Q What would that be?

MR. MCCURRY: It's very clearly specified in the Taiwan Relations Act.

Q Which is?

MR. MCCURRY: Which I don't have in front of me. I'll read it to you if you want me to read it to you.

             Q  What's your understanding of what that response --
             MR. MCCURRY:  Well, it makes it very clear that any

unnecessary provocative effort to resolve by other than peaceful means any disputes as to territory would be a source of grave concern -- I stress grave concern -- on the part of the United States.

Q You did not say anything about the reaction about the nature of the response.

MR. MCCURRY: Well, you're correct that there is not a security guarantee in there as there would be in the case of a treaty ally.

Q But haven't we paid prices for that by being so esoteric on such a strong point, as in Korea?

MR. MCCURRY: No, I don't -- that requires me to review history and the utterances of John Foster Dulles, and I don't intend to do that.

Q Well, it's very important.

Q Mike, back on Bosnia, a senior Russian official apparently is criticizing holding those two --

Q Acheson.

MR. MCCURRY: Was it Acheson?

Q Dean Acheson.

MR. MCCURRY: My history has really gone sour. Blame it on Dulles.

Q There's a senior Russian official who is criticizing the continued holding of those Serb officers and saying that it could be detrimental to the peace process. Is that the official position --

MR. MCCURRY: Is that today?

Q Yes, it's what I saw on one of the wires. Is that an official feeling of the Russian government? Are they totally on board with everything?

MR. MCCURRY: I can't reflect the views of the Russian Federation as to those developments. Now, Assistant Secretary Holbrooke, as he negotiated very carefully with the parties the so-called rules of the road as they apply to suspected war criminals who might be sought by the International War Crimes Tribunal, I believe reached a consensus with the parties that participants in the international force support. But I have to leave it to individual governments to address that.

Q Mike, how concerned are you that people in NATO have not been able to cite any recent communications with the Bosnian Serbs over this very issue? Are you concerned that we could see an unraveling of the Dayton Accords?

MR. MCCURRY: No, we believe -- and partly as a result of the discussions and deliberations that Assistant Secretary Holbrooke was able to achieve in the last several days -- that there is better understanding that will lead, we hope, to Bosnia and Serb cooperation with the entities that grow out of the Dayton Accords, including the joint military commissions and the civil military commissions that are a very important part of resolving any disagreements or misunderstandings that exist on the ground as the elements of the peace accord are implemented.

And the progress towards implementation and the work that they are doing is consistent with the general view that we've had along, that the parties are largely in compliance on those things that relate to their military requirements under the Dayton Accords. But, clearly, what we are working harder on is how do you bring the benefits of peace to the people of Bosnia? And that requires harder work on those civilian aspects of the Dayton Accords that are not directly part of the work of our troops and the international force that now is in Bosnia. But it is, nonetheless, an important part of the work of building confidence in the peace process itself so people stick it out and stick to it.

Q Well, what part is the war criminals? Is that military or is it civilian?

MR. MCCURRY: Well, the responsibilities as they pertain to the International Force and as they relate to the requirements of the International War Crimes Tribunal have been very carefully reviewed by Chief Prosecutor Goldstone, by Admiral Smith and by others in the NATO command, and they've been able to make it very clear in the statements that they've issued exactly what the requirements are that apply to the international force.

Q Anything new on Northern Ireland?

MR. MCCURRY: Not new, not anything new that I'm aware of, no.

Q Senator Hatch took off after the administration today saying that it had not sufficiently used the bully pulpit on the drug issue and he attributed it to the fact that a lot of administration aides grew up in the '60s when there was a lot of drug use. Then he went on to say that he'd seen some kind of private report proving to him that, in fact, drug use was more prevalent on administration aides. Do you know what he's talking about?

MR. MCCURRY: No. This is a canard that's been raised a couple of times in the past by others and it's not -- there's no basis in that charge. It's kind of surprising that someone of the serious stature of Senator Hatch would be making, saying something so silly.

The record of the administration on drug control is very well-known -- drug enforcement. And, obviously, the President's addressed that. The appointment of General McCaffrey to that position will now bring, I think, a new added element to the arsenal we have available in fighting the war on drugs. And I hope that Senator Hatch will watch as this war escalates, because, frankly, it has to.

Q Speaker Gingrich made -- actually, he wasn't the Speaker then -- but he made the charge early in the administration that there was -- that several people hadn't passed their FBI entrance things because of suspected drug use. And the White House, at the time, said it was nonsense, et cetera, et cetera, but said that some sort of review or something was going to occur anyway. Do you know if that ever happened?

MR. MCCURRY: It did. There was like -- I remember -- I haven't looked at in weeks, but this subject arises from time to time as various people try to use, frankly, what sometimes sounds a little bit like smear tactic to raise questions of this nature. The last time it came up was maybe six months ago -- no, maybe two, two or three months ago in connection with, I think, an article that appeared in The Washington Times. We had sent some documentation from our Office of Administration to the Hill that reviewed what the drug review policy was and the current status of all that. And we didn't hear further back, as far as I know. But I can get back into that and check on it for tomorrow if you want me to.

Q Tomorrow? Are you going on this trip, by the way?

             MR. MCCURRY:  No, I don't plan to at the moment, no.
             We need the in-house pool for the State Dining Room event

at the north door of the Briefing Room. That sounds like a good exit line.

THE PRESS: Thank you.

END 1:40 P.M. EST