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Office of the Press Secretary

For Immediate Release May 8, 1996
                            PRESS BRIEFING
                           BY MIKE MCCURRY

The Briefing Room

1:30 P.M. EDT

MR. MCCURRY: All right. Any other subjects today?

Q China.

Q I can't believe it wasn't asked. Is the President giving China an ultimatum. Will you start the sanctions proceedings against China on May 15th if they do not take the required steps?

MR. MCCURRY: China is very aware that May 15th is the deadline that we have for taking action with respect to China's obligations related to international -- intellectual property rights.

We've made some progress in our discussions, and they've made some progress in their handling of these issues. But since the agreement has been signed -- which we still don't believe we're seeing the type of enforcement that's necessary to comply with our own concerns -- so we are hopeful that prior to May 15th we'll see some steps by China that would alleviate the need for sanctions. But if China does not live up to the agreements that it has made with the United States, we will impose stiff sanctions.

And I'd say once again that there is still time for China to comply with the agreements it has reached with the United States, but that time is running out quickly.

Q Will you announce a list of targets today?


Q Mike, how will you measure that enforcement if it does improve? What yardstick are you using?

MR. MCCURRY: Well, the yardstick we use are those set out in the Trade Act of 1974, Section 306, specifically; and they're the ones, exactly those, and there's no surprise to the Chinese about what those measurements are because they've been reviewed in very high level trade discussions with the Chinese government by Ambassador Barshefsky. We have the Deputy Trade Representative, who will be in Beijing on Monday, and be available to address the concerns that we have.

Q That's t message that Sands is delivering?

MR. MCCURRY: Sands is -- this message is well -- the Chinese government is well aware of our concerns and well aware of the procedures under our law, and they know the time is running very short for us to reach mutually acceptable agreements on this issue.

Q The President said he will sign both bills, minimum wage and gas tax. I wasn't clear if both bills need to pass or simply a clean vote on minimum wage?

MR. MCCURRY: Both bills need to pass, because we need to raise the minimum wage now. The President suggested to you, I think very clearly, that we need to have a time certain for a vote, clean vote, on the minimum wage.

Q But if they give him clean vote on minimum wage, but that vote is defeated in Congress, he would then not pass the gas tax?

MR. MCCURRY: He did not suggest that.

Q Is it all or nothing, is the question we are asking.

MR. MCCURRY: He did not suggest that. And, of course, as you all know, we expect, given the strong --

Q He did suggest it, I'm just trying to find out --

MR. MCCURRY: Given the strong bipartisan support that exists for the minimum wage, we believe it would pass and the President would be pleased to sign it into law.

Q But he also said he'd be pleased to sign the other if he got a clean vote on both. Does that mean if --

MR. MCCURRY: If he said he would sign it, he would sign it.

Q I mean, should it go down then, but the gas tax repeal passed, he would sign that?

MR. MCCURRY: I'm not going to speculate on what action Congress will take with respect to those two measures, but we would obviously like to see minimum wage voted up soon, and down here so the President can sign it. We expect that's what would happen.

And then if the gas tax --

Q When he's talking about clean, though, he's trying to -- what he's trying to do is to get the other extraneous measures out of each of those bills, correct?

MR. MCCURRY: Yes, that's correct.

Q But if they came down here together, linked, just the two of them, he'd sign that, wouldn't he?

MR. MCCURRY: If they came down together in a package, I think it's very clear that he would sign that, recognizing that both sides had gotten something that both sides want. But I'm not going to entertain the speculation on the reverse because, as you know, the President didn't either.

Q You all had an agreement on China last year dealing with this particular subject. If you get up to the point now where there are only, you know, whatever, four or five days left in the year since that agreement was reached, what could China possibly do within just a matter of a day or two that would suddenly make up for a whole year that they haven't done anything about pirating of U.S. copyrights.

MR. MCCURRY: We've seen sometimes in hotly disputed trade cases and trade negotiations that as we move toward sanctions and move towards the clock running on the imposition of sanctions, suddenly that creates some new life in negotiations. And we hope that the time for that is now and that's the purpose of our Deputy Trade Representative, Mr. Sands', visit to Beijing on Monday.

Q Are you concerned with the Chinese threat to start a trade war with the United States?

MR. MCCURRY: We're concerned any time a very important trading partner to the United States threatens a trade war. We believe that a broad economic engagement with China is in the mutual interests of the people of China and the people of the United States. That is a factor in the President's upcoming decision on Most Favored Nation status, and we believe correct and mutually beneficial commerce between the two countries should reflect the status of our bilateral relations.

Q For MFN, would the sanctions, if they do kick in, fall short of the revocation of MFN, the impact that's been described surrounding it?

MR. MCCURRY: Would that be a factor in the evaluation?

Q Would the sanctions be worse than revoking MFN, or somewhat less punitive?

MR. MCCURRY: I'd have to defer to experts on that. The specific sanctions referred to in the case of intellectual property rights are minimal compared to the overall impact of Most Favored Nation status on our overall trading relationship. There's no question of that.

In terms of a sanction for trade disputes, the revocation of Most Favored Nation status is the thermonuclear device of trade disputes.

Q Mike, if the President signs the gas tax bill, will he suggest where to make up the lost revenue? Would he depend on Congress to do that, or how's that going to work?

MR. MCCURRY: Well, we believe it needs to be fully offset, and we have ideas on how that could be accomplished. They're different from the ideas that we've seen suggested by the Republican majority in Congress. But a temporary repeal of the gas tax between now and the end of the year, for example, could be offset in a number of ways.

There's one pending measure involving restoring payments to the insurance funds in both savings and loans and the business insurance fund that's been ready to go. There's bipartisan agreement on that and my understanding is that would more than offset the cost of the repeal.

Q And that's acceptable to you --

MR. MCCURRY: Well, we have to wait and see what happens. You've heard from the Republicans in Congress, they're not inclined to go in that direction.

Q Have you guys reached any decision, or will this meeting this afternoon review this decision on the proliferation of the technology from China to Pakistan?

MR. MCCURRY: That is a separate issue being examined by the Secretary of State. That may be -- I haven't heard that that's on the agenda today. I believe they're looking solely at the trade issues this afternoon.

Q Is this a decision meeting this afternoon, Mike, or a strategy session? How would you characterize it?

MR. MCCURRY: Well, the decisions we've indicated, and I've just indicated, are pretty clear. What we need to do is pretty clear. But how we approach the coming weeks and how we begin to identify those stiff sanctions that we would target on Chinese enterprises are the kinds of things you imagine would be under discussion.

Q What do you plan after the meeting in terms of --

MR. MCCURRY: Mr. Johnson can give you a quick read-out afterwards.

Q But, Mike, back on the missiles, you would foresee a decision on that, a review of that after this decision and after MFN?

MR. MCCURRY: Secretary Christopher is deliberating that issue and there have been follow-up conversations with the People's Republic that have been productive, in our view, following the Secretary's meeting with the Deputy Premier of China on April 20th -- 19th, April 19th.

Q Mike, when the President entered the room here he merely asked the Republican Congress for clean votes -- clean, separate votes of the minimum wage increase and gas tax repeal. It took four repeated, insistent questions to get him from that position to saying he would sign both bills.

Can you shed some light on whether he intended to go as far as saying he would sign both bills when he entered the room, or was that a decision he made during the press conference?

MR. MCCURRY: No, he knew full well he would get that. I think the President was attempting to communicate to you how strongly he feels about the minimum wage increase and how much a priority that is for him personally.

Q Mike, why does he take, you know, kind of a tooth extraction process to finally get him to say he was going to do what he is prepared to do if he was willing to do it when he entered the room?

MR. MCCURRY: That's a bizarre question I don't have an answer to.

Q Mike, can you just explain one thing about Pakistan? Is there a deadline on the ring magnets, or whatever they are called, like there is a deadline on intellectual property? Is there any kind of schedule --

MR. MCCURRY: There is not. It is subject to a legal determination. The Secretary of State is required to make by law under Section 825 of the Nonproliferation Act.

Q Mike, earlier today, it appears that the 8th Circuit said that the Paula Corbin Jones suit could go forward and not have to wait for Supreme Court review. What is the White House response on that and what steps will you take?

MR. MCCURRY: I didn't know that and I will have to consult with the White House legal counsel on that.

Q Mike, does he think that repealing the gas tax is a good idea by itself of is merely doing that in the spirit of accommodation of Republicans in Congress?

MR. MCCURRY: The President is very clear. He wants to break a logjam. He has some questions, as do many Democrats in the Senate, about whether or not the American consumer would see that repeal at the gas pump. We are very concerned about comments, including the Chairman of ARCO, who indicated that consumers won't likely see a repeal of the gas tax at the gas pump.

And that is a significant statement since, of course, the Chairman of ARCO is the vice chair of Senator Dole's finance committee. So I think it is important in the President's view to make sure we do something that will immediately bring relief to working people. And that is, you know, the minimum wage.

Q What is the reference to Dole's campaign? What are you suggesting?

MR. MCCURRY: Well, the comments of the Chairman of ARCO is, apparently, an advisor to Senator Dole.

Q You said that, but what do you mean by that? What is the significance of that? Will you explain the significance of tt?

MR. MCCURRY: I mean that you have got someone who is close to Senator Dole who is suggesting that a repeal of the gas tax won't be passed on to consumers. And that presumably is --

Q And it's important that -- and this bill is important, why?

MR. MCCURRY: Because I believe that Senator Dole certainly gives the appearance in his statements on this issue that he is trying to provide relief to consumers.

Q Alright, and?

MR. MCCURRY: And he has got someone who is very knowledgeable in that industry telling him that is not likely to happen. I think that is significant.

Q So are you suggesting that Senator Dole is really doing this to the benefit of the oil industry, and for that company in particular?

MR. MCCURRY: No, I am not suggesting that.

Q How else to interpret that, please?

MR. MCCURRY: I think it is an interesting coincidence.

Q Well, are you just going to let it hang out there as kind of an innuendo, or are you going to explain it?

MR. MCCURRY: No, I am not suggesting that there is any innuendo there. What I'm saying is that you've got a situation where a leading oil company executive, who is known to be close to Senator Dole, is suggesting to him that what Senator Dole is advocating on the floor may not work, to the ends that Senator Dole has advertised.

Q Didn't he support the President in 1992?

MR. MCCURRY: He may have, I don't know.

Q Isn't he a large giver to the Democratic Party, as well?

MR. MCCURRY: It doesn't matter. The point I am making is --

Q Well, what matters?

MR. MCCURRY: What matters is that the oil company executives are indicating, and many of them beyond this one individual, have indicated that consumers may not see the impact of this repeal at the gas pump. And that's the point.

Q The relevance of that is clear. What is not clear is what the relevance is of the relationship with Dole.

MR. MCCURRY: Well, who does Senator Dole rely upon for his advice when it comes to matters regarding --

Q Is that a question or an answer?

MR. MCCURRY: It's a question.

Q So, you did all this by way of raising a question? You went through this whole rap about this guy --

MR. MCCURRY: I did this to suggest the President is concerned that oil company executives have indicated that a repeal of the gas tax might not show up at the gas pump for the American consumer. That's a significant piece of information.

Q That's true. But the difference is that the oil company executive -- the relationship to Dole, you still haven't explained.

MR. MCCURRY: That's true. That's true.

Q Mike, why doesn't the President mention that, that he said he would be willing to sign this even if it didn't go into consumers' pockets. I mean, he didn't say that that was a condition of him signing it. He doesn't seem to care that --

MR. MCCURRY: The White House and the President are very supportive of the efforts the Senate Democrats are making to try to attach an amendment that would pass that benefit directly to consumers.

Q But that wouldn't be required for his signature?

MR. MCCURRY: He did not indicate that, but we are supportive of the efforts they are making to try to make sure that it would get passed through.

Q It seems a lot easier to talk about rolling back the federal tax than it does to make up the revenue that would be lost. Do you think this will be left hanging as an extra deficit penalty?

MR. MCCURRY: Until the source of offset is specified, it will be an additional burden on the deficit.

Q But it doesn't have to be specified. It can just be out there.

MR. MCCURRY: It could be passed without an offset, but that then adds to the budget deficit burden that the President suggested to you a moment ago that he should -- that we should be addressing in a bipartisan fashion.

Q Mike, does the President support big labor over raising the minimum wage? Why is the team act such a poison pill?

MR. MCCURRY: Because it sets up the company and management's ability to designate who they're going to negotiate with. Now, Senator Kennedy had a very useful suggestion. He said just let the workers designate who their representatives would be for that type of discussion. And that makes -- that's perfectly sensible and a good way to adjust that measure, and it ought to be considered as an amendment to that measure.

Q Back to China. You said that they have been showing some cooperation, some willingness to backtrack or whatever they're doing. What have they said, actually, in reality?

MR. MCCURRY: Well, they have taken some steps from time to time related to factories and production facilities that are pirating CDs, but insufficient --

Q Closing them down, you mean?

MR. MCCURRY: Well, closing -- I don't know that they've taken -- gone so far as to close them down, but they have provided information related to their own inquiries into the nature of some facilities in certain provinces. The problem is, we believe, that there is more extensive activity than they have been willing to suspend and investigate.

Q Mike, are the sanctions ready to go on -- in other words, if after the 15th you don't like what China is doing, you will impose them the next day on the 16th?

MR. MCCURRY: Well, that's the deadline, and part of the deliberations that are underway within our government now are to target and identify those sectors that would be subject to sanctions.

Q There was a report last night -- I'm just curious. There was a report last night from one of the organizations quoting AAA people and saying that even if the entire amount of the gas tax repeal were passed straight through, consumers at the pump, it would net the average motorist for the rest of year about $20. Is that something that the President considers worthwhile to go through all this hassle for, $20?

MR. MCCURRY: The President understands the burden that American consumers are facing because of increased oil and gas prices. Now it goes well beyond the $.043 that we're talking about in connection with the gas tax. There has been a noticeable spike in prices. The President has acted to try to do something about that by nudging the market in what we hope is a more beneficial direction.

Q It just seems like an awful lot of effort to go through for not much impact.

MR. MCCURRY: Well, I mean, it's --

Q Is it somewhere else where that would show up?

MR. MCCURRY: It clearly is a very high priority of the Republican leadership in the Congress, including Senator Dole.

Q Mike, earlier on in this debate over the repeal of the gasoline tax, you made a big deal about challenging Dole to explain how -- where the offset would come. Is that still part of the formula for you? The President --

MR. MCCURRY: It is. I mean, we have to know how we're going to pay for it. More importantly --

Q Why didn't the President mention that today in -- since he's so determined to get a balanced budget?

MR. MCCURRY: He would have mentioned that in response to a question. And he also, you know, he's followed very closely the debate in the Senate and knows that some offsets have been suggested in the Senate.

Q Would he sign it if there was no offset?

MR. MCCURRY: He made clear today he would sign the bill. And we'll -- we see how the debate is going. We'll have to see how it --

Q Mike, on the consumer pass-through amendment -- which you indicated is not necessarily a price for getting the President's signature, but nevertheless is a White House preference -- how would you -- if you even got this into law, how would you enforce it? How would you monitor the pass through of $0.043 a gallon when you have these up and down fluctuations in crude oil prices? The President himself pointed out that since he took action, the price of crude has gone down $3.00 a barrel.

MR. MCCURRY: Leo, you should direct that to the sponsors of the amendment that's under consideration in the Senate. My understanding, or the administration's understanding is they're looking for record keeping compliance measures that then would have some type of enforcement through the Department of Energy.

Now, there is a specific amendment that Senate Democrats have apparently been working on that would try to attempt to address that issue. We are generally supportive. I don't know that we have seen the specific form of how you would regulate that pass through, but we're generally supportive enough to make sure that the American consumer would see the benefit of the repeal.

Q The President has -- he seems to have confused matters. I mean, recently there are many Democrats who have felt really emboldened to either hold out for an offset or hold out for some kind of pass through, and they didn't feel like the gas tax repeal was as unstoppable as it seemed just a couple days ago. And now here the President is saying he willing to sign it with no conditions of an offset or a pass through.

MR. MCCURRY: Well, the President made --

Q And hasn't he undercut the efforts of his own Democrats on Capitol Hill?

MR. MCCURRY: I dispute the interpretation of your question. The President made it pretty clear that he wants to break a logjam here that exists now between Democrats who want to see the minimum wage increase, and the Republicans who are pushing the repeal of this gas tax. And that goes without saying that we want to see both of those done, and we are going to work to see that both of them get done.

Q Are you telling Democrats to stop pushing for either?

MR. MCCURRY: No. We have been working very carefully and closely with the Senate Democratic leadership.

Q Does the President like the offset suggestion of spectrum sales, and what does he think about the Travel Office -- I mean, the energy travel curtailment?

MR. MCCURRY: I don't know that we have addressed those. And we think there are better ways -- if you are going to guarantee an offset, better ways to do it.

Q Did the President ever ask for a 45 day moratorium on politics -- I mean, something as general as that? I think I read it somewhere and I'm -- have you ever --

MR. MCCURRY: Not that I recall. You asked that earlier and I couldn't -- I was trying to think of what you were referring to. Not that I know of.

Q Mike, that addition to the gasoline tax was passed at the President's behest, or at least at his urging, and it was a part of his original economic program and was there for the purpose of deficit control. Deficit control remains central to the President's stated goals. Why would he not defend that with a veto at this stage if it is sent before him without an offset?

MR. MCCURRY: Well, it was put in place as part of a deficit reduction package that worked, but it was also put in place given the -- given the price structure of the market that existed at that time. And we have had an extraordinary phenomenon in oil and gas markets over the last couple of months. And it's sudden and, you know, interesting and unusual price increase and spike.

Q He never indicated that that was something that was subject to repeal, as far as he was concerned, if the price got up there or not.

MR. MCCURRY: Well, you're correct. You're correct, he did. But it was one, you know, aspect of a very large, comprehensive budget deficit reduction package.

Q Well, why would he not now himself be proposing an offset if he is willing to accept it, and urging that that offset be adopted as part of the package?

MR. MCCURRY: Well, we are prepared to, if asked, prepared to suggest ways that we could offset a repeal.

Q Well, you know, you don't have to be asked if you're the President of the United States. He has never been shy before. Why wouldn't he get in there and fight for something?

MR. MCCURRY: Because it's on the Senate floor now and it's under active consideration. There is no indication from Senator Dole that he is going to take our suggestions as to an offset. Now, I've suggested to you that --

Q He's got the veto pen there. That's a powerful weapon, isn't it?

MR. MCCURRY: -- the BIF/SAIF provision that has already been largely negotiated by both sides of the aisle makes good sense as far as an offset.

Q Mike, he just listed a whole list of poison pills. He was about as specific as you could get on each of these pieces of legislation, on what specific things he didn't want in it. Why wouldn't he say, on the gas tax, what has to be included for him to sign it?

MR. MCCURRY: Well, because the debate is -- look, he doesn't want to complicate the effort to break the logjam. We're just saying he is going to -- he would sign that in order to get the minimum wage increased. And that's what he wanted to make clear to the Senate. And how they do that -- I mean, obviously, we can negotiate further on how they will get that done, but the important thing is to get on and get it done.

Q It seems like that would be bipartisan cooperation, though, to tender an offset that the Senate might consider?

MR. MCCURRY: Well, if they -- I mean, that's a good way to do it. If you want to take the provision that has already been agreed to, that the Treasury Department has indicated that it needs regarding the insurance funds in the financial sector, that's a good way to do the offset.

Q Mike, something different. The question Wolf asked the President about the accuracy or inaccuracy of TV ads. Is the White House at all concerned about both sides kind of hyping or going over the line in their TV ads? And if it's so difficult to get his point across in 27 seconds, why not just add another five or 10 minutes -- seconds, I mean?

MR. MCCURRY: The President answered that question, I think, already. Using the nomenclature that's available, a cut's a cut. And if you're an elderly person who is facing what the impact of those premium increases or reductions in services would be, it's going to feel like a cut.

Look, they, in their advertising, they say this as all the time, accuse the President of having the largest tax increase in history. That's a very debatable proposition if you look in real dollar values and terms like that. I mean, you know --

Q But you don't want to say that you're going to use inaccurate language because they are, do you? That's not the --

MR. MCCURRY: No, I'm not saying that. I'm saying that a cut's a cut. And we believe it's a cut.

Q The President seemed exercised by the language used against him up on Capitol Hill and I presume he's suggesting that since he doesn't engage in that, has he asked you not to engage in that and other surrogates not to engage in it and not to --

MR. MCCURRY: He has. And I do my best. (Laughter.)

Q Have you ever been called on the carpet for being a little too rough on the other side?


Q By him?


Q A clarification on China. You said that the sanctions for intellectual property would be a factor in MFN, but up until now the President --

MR. MCCURRY: I can't hear what you're saying.

Q You had said that the sanctions dealing with intellectual property, that discussion is a factor in MFN decisionmaking, correct? Up until this point, the President and administration officials have said that he would extend MFN. So I just want to clarify, is that now in question?

MR. MCCURRY: It's a factor in evaluating the overall relationship. It is not a decisive factor in the question of Most Favored Nation status.

Q So he will still extend MFN?

MR. MCCURRY: I haven't heard anything to the contrary.

Q When the President called for health insurance reform without medical savings accounts, he used the term "nationwide, unrestricted" MSAs. Does that mean that you're open to perhaps MSAs on a pilot, test basis?

MR. MCCURRY: I think when he said "permanent, nationwide" medical savings accounts, he chose those words very deliberately.

Q Mike, what order of magnitude are we talking about with these sanctions on China for intellectual property rights?

MR. MCCURRY: It's the -- USTR has suggested what the likely range is, and I don't have any disagreement with their figure.

Okay, thanks.

THE PRESS: Thank you.

END 1:55 P.M. EDT