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Office of the Press Secretary

For Immediate Release July 22, 1997
                              PRESS BRIEFING BY 
                                MIKE MCCURRY 

The Briefing Room

1:30 P.M.

MR. MCCURRY: Ladies and gentlemen, I apologize for running a little bit late today. I was wishing Nicholas Burns farewell on his last day of briefing at the State Department. And I said, and I think I am maybe alone qualified in saying, that in the life of the Clinton administration, no one has commanded the podium at the State Department better than Nick Burns. (Laughter.)

Q We couldn't agree more.

Q No, a lot of people say that. (Laughter.)

MR. MCCURRY: Rita's right, a lot of people are saying that.

Q When is his nomination going up?

MR. MCCURRY: He is highly regarded by the President and I expect there will be good things in his future. Good things, sometimes, if you're patient, are worth waiting for.

Q Where is he going? Ambassador to Greece?

MR. MCCURRY: That's the rumor. It's the rumor. I can't confirm anything here.

His hearing is coming up this week, but the Secretary, I believe, is departing on a trip. Is that not correct? She's going to Asia for the ASEAN meeting, so Nick will not return to the State Department podium, but I imagine, though he will miss it, he has better and bigger things to do.

Q Why did you give him a Red Sox cap?

MR. MCCURRY: He's a huge Boston Red Sox fan. He opens every State Department briefing demanding fidelity to lost causes.

Q What are you going to be ambassador to -- Tanzania?

MR. MCCURRY: Sort of like what we give here, too. Got to do better than that.

Hi, Leo, what's up?

Q Hi, Mike. Can you flesh out the President's new proposal on Medicare, how this would actually be handled administratively if you don't let IRS do the job? Wouldn't you have to create again the separate bureaucracy and run the same risk that the President says would be run if HHS did it?

MR. MCCURRY: We are trying -- first of all, remember our preference was to do this through the normal income tax process that a typical tax payer proceeds through. And doing it that way would save $5 billion over five years, $12 billion over 10 years, compared to the Republican plan, as advanced in the tax bills on the Hill to do it through the Department of Health and Human Services. So our preference all along has been to do this in what we thought was the most orderly fashion, which was connected to income tax filing.

Now, we understand and have tried to be responsive to the expressions of concern by the Republican majority in Congress, which is why we have developed -- or at least developed the outline of a different proposal. And it works, according to the information I have, like this -- if you ask me to explain this, I will hit you with a wet noodle, because I have no idea exactly how they would administer this, but this is what the Treasury thinks they can do.

First of all, it would not be administered by the Internal Revenue Service, it would be administered more broadly by the Treasury Department. Near the end of each year, all elderly Americans would receive a Medicare premium adjustment form in the mail. Instructions would be attached to the form telling the beneficiaries how to calculate their income, the timing for calculating income would be done the same way as calculating income for tax purposes.

This form would be sent to the Treasury Department, along with the tax form, so it would make it somewhat easier for a typical filer to submit the document. Beneficiaries would return the form if they were required to make a payment because of the means test, they would make a check payable to the Medicare trust fund so the funding would be devoted to the trust fund. The payments would be due on April 15th, consistent with the tax filing deadline.

Q No one will think it's a tax.

MR. MCCURRY: So the beneficiaries can calculate their incomes once for purposes -- for tax purposes, and then mail in with their returns. It makes it easier. The Treasury Department would then make sure that the Medicare payments are directed to the Part A trust fund and they would be able to work out if there was an overpayment or underpayment, as you would typically with the refund, they would work it out.

Now, don't ask me -- (laughter) -- why we are going through this. As one highly-placed aide here said, it is a cosmetic solution to a cosmetic problem. But we are responding to the concern expressed by the Republican majority in Congress. And the Treasury Department does believe that this would be more cost-efficient and less costly to taxpayers in the long run than developing a whole new quasi Internal Revenue Service within the Department of Health and Human Services, which I think a fair-minded person would say is a common-sense point.

Q Can I just follow up a couple of points? One, if I understand you correctly, taxpayers who are seniors instead of sending two envelopes, one envelope on April 15th, would be sending two to different parties -- one to the IRS as usual and one to Treasury. But wouldn't you have to set up a whole new bureaucracy within Treasury -- you're talking about 33 million seniors -- and a fair percentage of those might be over the $50,000, $75,000. Who in Treasury would scan these things as they come in, who would follow up on whether proper filing has taken place, or filing at all?

MR. MCCURRY: Well, they, Treasury -- you will concede the point that the Treasury Department is the more logical place to do this than the Department of Health and Human Services, as starters.

Q Well, you're conceding it.

MR. MCCURRY: No, I'm -- hopefully a fair-minded person would make that point. (Laughter.) But second, the Treasury Department through the IRS already does have to analyze and screen tax returns so they have some capacity for doing that. And of the elderly that we're talking about that would do this form, it would be, in a sense, for administrative purposes, it would be like handling another schedule within a tax return.

But, clearly, with the funds directly to the trust fund, it would, we hope, make it more palatable for someone filing this income premium, to indicate -- or income-tested premium -- to indicate that it was being directed to the trust fund. And exactly, politically, that is the purpose of the provision to begin with -- to extend the life of the Medicare trust fund.

Q I mean, assuming you're not just doing this to show how ridiculous the whole exercise is -- I mean, one of the complaints that you guys had in the beginning about why you might not want to agree to this whole scheme in the context of the balanced budget agreement is because it was kind of done at the dead of night, no hearings, not well-thought-through. First they were going to means test deductibles, then they switched to premiums. And critics of this have said, look, there's ways to means-test, to make richer seniors pay more, that are simpler and that are not so Rube Goldberg like as what you guys are --

MR. MCCURRY: Look, I outlined you the best-faith effort the Treasury Department has on how they will put it together. And this is -- if you're not doing it just straight-forward through the IRS, this is the best way to do it and the least cost.

Q What I'm asking is, aren't there dangers to doing something that is so complex rather than --

MR. MCCURRY: I don't know that what I outlined -- maybe I made it sound unnecessarily complex -- you figure out your income. You figure out whether under the means test provision you owe any money due to the income levels, which would be -- we're talking about upper-income, elderly Medicare beneficiaries to begin with, so we're not dealing with the entire universe of elderly be required to file. Most elderly, obviously, would not file. And if you've got it due, you pay it. It's not unlike other transactions you do as you're calculating your taxes. I don't know that it's that hard to figure out.

Q What is the income that would trigger higher premiums?

MR. MCCURRY: Well, for example -- I mean, I can't -- I don't know that they have placed that into law yet. One of the things, it would have to be a lot lower if you were going with the Republican plan because, if you're collecting the money they were talking about, you'd have to set the income test much lower because of the cost of their proposed way of collecting.

But just for example, the Blue Dog proposal that had been pending in the -- this is not the bill we're talking about now because that has yet to be determined -- but similar proposals -- the Blue Dog proposal in the House and in the Senate bill, the income test began at $50,000 for single beneficiaries. The 1995 Republican budget plan began at roughly $60,000. When we did this -- correct me if I'm wrong -- but when we did the health care proposal, the income test under means testing kicked in at about $90,000 for a single beneficiary. That was in the '94 health plan. So it would be set at -- that's the range that they're talking about, but I don't know that they've worked through with Congress.

What we're doing -- and again, we're coming forward with this in a response to some of the concerns expressed by the Republican side and to demonstrate the determination of the President to follow through on his commitments to include this in the final version of the legislation.

Q MIke, standing here today, does the White House really believe that this is politically palatable?

MR. MCCURRY: It's politically palatable, yes. I mean, the President, on the subject generally of means testing, has said the American people understanding the geodemographics we face going into the next century, every American including elderly Americans know that increasingly the elderly population grows and we have to take steps to secure programs like Medicare for the future, and that an application of a means test in a limited fashion like this could be useful. I think that's politically palatable.

Q Let me put it a different way. Do you honestly, standing here today, believe that this plan is going to wash?

MR. MCCURRY: That it's going to be in the bill at the end of the day? We'll see.

Q Mike, when the President said that when he got off the plane from Madrid he made strong comments in support of this, could you give us the citations on that? Because I don't see it.

MR. MCCURRY: Where was it that he said that?

Q He said, practically as soon as I got off of the plane. When did he --

MR. MCCURRY: It's when the bipartisan leadership was here and he addressed that in the Q&A session you all had with him. But we can pull the transcript for you.

Q That was the day he was referring to?

Q That's what he means --

MR. MCCURRY: I think it was Tuesday, it was maybe the day after.

MR. TOIV: He also spoke to it at the press conference, I believe.

Q Yes, but very vague at the press conference.

MR. MCCURRY: It was the Q&A with the congressional bipartisan leadership.

Q If the Republican version was going to cost to your estimate $5 billion over five years --

MR. MCCURRY: Five billion more than -- we would yield $5 billion less in revenue, $12 billion less over 10 years.

Q This new plan, just having Treasury as opposed to IRS doing it, or HHS, how much would that cost?

MR. MCCURRY: I don't have an estimate on that, but the Treasury Department will try to calculate that.

Q When you give those estimates on the revenue, what are you basing that on? At what income level would this kick in?

MR. MCCURRY: That's the anticipated cost of administering the collection of the revenue through the Department of Health and Human Services based on what their administrative response was to the question -- what would be the collection.

Q And do you have any estimates for how much revenue would be yielded from these various proposed income --

MR. MCCURRY: It was roughly --

MR. LOCKHART: Less than ten, I think, for five years, and less than five under the HHS --

Q When it kicks in at what income level?

MR. MCCURRY: You mean on the original, on the Republican version in Congress. You lost about half of the revenue that would be collected by the premium because the administrative costs of doing it at HHS, as the President said.

Q You said this whole plan brings in $9.8 billion over five years if you do it the IRS way.

MR. MCCURRY: No, I said -- that's roughly right, yes.

Q What income is that based on?

MR. LOCKHART: I don't know what number they used.

MR. MCCURRY: I think that was based on the -- it was the kicked in Republican version kicking in, I think, at $60,000 for a single beneficiary and then graduated for dual income households.

Q Who is this charade for the benefit of, the members of Congress who are concerned about it or for the American people?

MR. MCCURRY: It's not a charade, Mark. If you're going to apply means testing, this is the way to do it if you are not going to do it through the Internal Revenue Service.

Q But have you shown this to any Republican leader? Is there any indication that they're actually ready to sign on to this?

MR. MCCURRY: They've had discussion on the Hill with the conferees and this is our proposal on how to do this.

Q Are your policy people clear that of all the different ways to make people with more resources pay more for Medicare, this is the best way to do it?

MR. MCCURRY: I am told that if you want to collect the premium against a means test income test as proposed by the Congress in the legislation, this is a more efficient way to do it than to do it through the Department of Health and Human Services.

Q But I'm saying if you guys were designing a method, would this be it?

Q When the President says he could defend any member voting for this, Republican or Democrat, what kind of political cover is the President offering to members of Congress?

MR. MCCURRY: He obviously will defend those who vote for it, and it will have some impact in protecting those who vote for it against those who would attempt to attack them politically for having voted for it.

Q To what extent is he willing to work for this? The initial reaction back from the Hill is it's dead, this isn't enough. To what extent would the President be willing, when you talk about bringing the whole budget negotiations to a higher level, to what extent is the President willing to go in and make his case for this?

MR. MCCURRY: The President will protect those who vote against it if they are subject to attack politically for having voted against it. That's what he said. I haven't talked to him about how elaborate that is going to be.

Q Mike, does the President envision situations where he would be out campaigning for Republican candidates against Democrats who are --

MR. MCCURRY: I think it's more that there are ways in which the President can speak publicly that indicates what his position is, and that provides some measure of help to those who are defending any vote that they've made in the Congress.

Q Mike, could you explain how this erases the image, the specter of a tax increase? Is it just simply using the Treasury Department instead of the IRS?

MR. MCCURRY: Oh, writing a check to -- I mean, I think, if an individual citizen is writing a check to the Medicare trust fund and with the understanding that is part of a plan to extend the solvency of the trust fund so that it will be there for future generations, they're not going to feel necessarily like they're writing their check to the Internal Revenue Service for general revenue purposes. There is some distinction there, however valid it is, you can put it out and there will be a public debate on it.

Q Did I understand you to say that the people who work in the IRS currently would do the screening of the forms themselves and the processing? Is that right?

MR. MCCURRY: They have the technology and the expertise to do it, so there would be some IRS involvement, even though the program would be administered by the department itself.

Q What's the status with the other big items on Medicare -- raising the eligibility age to 67, and also the $5 co-pay?

MR. MCCURRY: Well, they're still under discussion within the conference committee itself. Remember, we're talking about something that is solely the product of a discussion on the Republican side of the aisle. They indicated that they were going to back off the Senate-passed means test provision. So that issue has not come before the conference yet and many of the big-ticket issues, as you point out, are still pending before the conference.

Q How is the overall outlook for the budget?

MR. MCCURRY: We think good. This is not -- this is one issue, but not necessarily the critical issue in these discussions. I think this issue could be resolved relatively expeditiously, and they could get on to what are really the serious issues at stake in coming to a final agreement.

Q What are those?

Q When do you think that will happen?

Q What are those?

MR. MCCURRY: Taxes and spending, as I've said before. I mean, you all know what they are.

Q Why, when the President initially didn't want to have Medicare be at all involved in this budget process would have now enmesh himself in this, vis-a-vis, the tax increase?

MR. MCCURRY: No, David, you're just way wrong. I mean, from the very beginning, the President has fought for savings from Medicare that would extend the solvency of the trust fund. That's been a feature of our proposed Fiscal Year 1998 budget, it's been part of the agreement. Now, we originally got generated the savings we need for Medicare without applying a means test, but the Congress felt strongly about it. It arose during the Senate consideration. We've accepted it. We're for it. And we will try to make it work.

Q Under the President's proposal as you've explained it, would federal employees at Treasury who do not currently have the authorization to look at people's income tax forms, then now have the authorization? Would people's income tax forms be reviewed by employees outside of the IRS?

MR. MCCURRY: I don't think they anticipate changing procedures, but I'll refer that to Treasury.

Q Mike, would you take the question of what the additional costs would be to Treasury for implementing this plan?

MR. MCCURRY: I'll see if and when Treasury has a cost estimate on the --

Q But it clearly won't be as efficient as if the IRS were to do itself, correct?

MR. MCCURRY: It wouldn't be as efficient as the way we suggested it be done in the initial instance, correct. But it would be better than doing it through the Department of Health and Human Services as the Congress is currently considering.

Q Getting to another subject, the crack cocaine disparity in powder and crack --

Q Can I just ask one more question on this?

Q No, let me get to this real quick.

MR. MCCURRY: Why don't you hold the thought. Let's just finish on this. I don't have much more on this. Beat the dead horse a little more.

Q The only question I have is, the President said that the budget team would be going up to the Hill shortly for more negotiations, but there's nothing scheduled. Do you know anything about that and what he's talking about?

MR. MCCURRY: We're hopeful we can engage the leadership. We think it's -- we're at a point now where we need to reengage the leadership, particularly those that were involved in drafting the agreement, and I suspect that will happen over the course of the coming day or so.

Q You don't know of anything today?

MR. MCCURRY: We'll see. A lot of hours left in this day.

Q If the negotiators are unable to put back together the means testing element, how critical is it to this whole agreement? Is there an easy way around it? I mean, if the means testing thing collapses despite what the President has said --

MR. MCCURRY: Remember, in our proposed agreement, or in the agreement itself, they generated the $115-billion of savings in Medicare without using this means testing provision, so you can clearly do it without relying on this particular feature. But if there is a determination that we need this feature, the President is willing, in good faith, to work with Congress to design one that is administratively acceptable.

The problem is the way it was originally structured it's not, and as the President indicated, the other problem was, you could not require a 100 percent level test for benefits received, because that would, in effect, take the highest income elderly, give them an inducement for opting out of the program, and we want to try to preserve the universality of the program itself, which is why most of the discussions have been on testing and 75 percent.

Q Going back to this issue of the offer of support for Republicans who might vote for this plan, how can the President square that with some of the Democrats for whom he's raising money tonight with the DCCC?

MR. MCCURRY: I don't know what that means. Look, we're not saying that we're going to go out and campaign for Republican candidates, we're saying that if the President says publicly that you made your vote, it was a good vote, it makes it a lot harder for a Democratic candidate or a Republican candidate for that matter, to attack an opponent who has voted for the provision in question. You just play back the President's statements and that provides some level of comfort to the member of Congress who has voted for the provision. That's especially true when you have a President that's at 64 percent popularity.

Q As I recall, in a '93 budget deal, there was an increase to taxes on wealthy people that have received Social Security, and that money was earmarked for the Medicare trust fund. Why didn't you have this kind of system that you're outlining now for that provision or, alternatively --

MR. MCCURRY: That was basically done through the income tax system. As I keep saying, that would have been our preferred way of administering this particular provision, but we're responding to the expressions of concern by the Republican side.

Q How can, on the one hand, you say that the President will provide political cover for, for example, a Republican voting for this, and on the other hand say we don't really need this as part of the budget deal and sort of say we could walk away from this if we had to because --

MR. MCCURRY: I'm not saying -- look, we're trying to get a deal done here and implement it. This is a provision that apparently many people on the Hill feel strongly about, we support it, we're trying to make it work, trying to give them a way that they, if they want to pass it into law, they can be confident it will work effectively. And if it raises a political issue and subjects a member of Congress to some form of political attack, the President's been willing to say he'd get out there and be the first to say that it's a good vote and it makes sense from a policy and economic point of view. Now, that will be helpful to some members of Congress, presumably. But let's not make more out of this than what it is.

Q Mike, during the '95 budget fight, Democrats were accusing Republicans of trying to make Medicare recipients pay for tax breaks for the wealthy. Why would this not be interpreted the same way?

MR. MCCURRY: Because I think it's structured in a way that clearly the highest income elderly are those that are going to be subjected to an income test for the premium payment. The costs are not coming broadly across the board from all beneficiaries. It's very carefully structured. And the impact and incidence of the premium payment is such that you extend the benefits of the program broadly for the current population.

I mean, you -- look, we also are dealing with the solvency question, looking for a way to generating savings. We had provided our ideas during that debate on this. And we think this is a sensible way to at least try to accommodate the concerns that have been expressed by the majority.

Q So, Mike, I understand you're trying to send the Republicans a message in saying, well, they feel strongly about it, we're going to go along with that if it's administratively doable and we'll even provide political cover. But it seems like you're not having a hard time restraining your enthusiasm for this as a policy idea. I mean, how enthusiastic is the President? In a perfect world, is this the way he'd begin to address Medicare's long-term structural reforms -- this particular way? I'm not talking about means testing in principle.

MR. MCCURRY: This is not an effort to deal with the long-term structural problems of Medicare or, for that matter, Social Security. But, philosophically, the application of some type of means test to those programs is something generally acknowledged as something that should properly be under consideration at the proper time. We're not prejudging any of that discussion by advancing this proposal today.

Q Let me just follow up. Is the reason that he feels this is okay to do this and there's not danger in this is because fiscally, it's pretty trivial? I mean, what you're talking about is not huge savings. He kept on repeating today, look, the biggest savings comes from --

MR. MCCURRY: These are not -- in the sum total of all the things that we're doing in this agreement, this is not, in dollar terms, as significant as other aspects of the agreement, including the education relief, including the overall savings generated by the agreement over time. Even in Medicare, it's not the most significant extender for solvency within the Medicare portions itself. But there may be value in the philosophical premise that we have adopted some element of means testing just as there was when we introduced elements of means testing into the Social Security program in the 1980s.

Q Mike, the Senate and the House both said they'd favor included in the bill the creation of a commission to deal with these long-term financing problems of Medicare. Does the President have any view about what kind of a commission that should be, how it should work, who should --

MR. MCCURRY: We have said that there should be a bipartisan process. We have not ruled out that it would be some form of commission. But there should be a process that is truly bipartisan, can produce the kind of result that the negotiations that led to the bipartisan balanced budget agreement produced. That did not require a commission. But the President has pledged to pursue some type of bipartisan process to deal with long-term entitlement reform issues.

Q Does the White House believe these added -- these additional premiums for more affluent Medicare recipients amount to, in effect, increased taxes?

MR. MCCURRY: It amounts to a means test.

Q But is it increased tax?

MR. MCCURRY: And it's being structured so that they represent payments to extend the solvency of the Medicare trust fund, and that's the way I would characterize it.

Q What harm is done by having the best people opt out of the system?

MR. MCCURRY: Well, you mean if they opted out altogether? You increase -- it's like any other group insurance pool, you increase the cost of the program if those who are the healthiest and the wealthiest opt out. You change the structural cost of insuring the remaining population. It's like any other -- works like any other group insurance plan that had to be calculated actuarially.

Q If the IRS employees the ones doing the actual processing, what will the Treasury --

MR. MCCURRY: Peter, look, you guys can't ask me that level of substance. We're trying to work through -- we've got an idea; the Treasury Department is working hard on it. If you're that interested, please contact some experts at Treasury.

Q In terms of the actual means test that the administration would apply, I gather there's no endorsement today of either the $50,000 or $75,000 threshold or the range of increases in the premiums.

MR. MCCURRY: I don't think that we have -- we have not addressed the question of exactly where you set it.

Q As a matter of fact, isn't it the other way around, that the way the Senate voted, the President is opposed because that's what he's really referring to when he is saying that you're running the risk of chasing people out of the Medicare system? In other words, that the -- as I understand it, the premiums go up very high when people reach incomes above $100,000. In other words, the President is not ready to accept what the Senate has proposed, is that correct? In terms of the actual numbers.

MR. MCCURRY: You mean in terms of the actual --

Q The higher premium.

MR. MCCURRY: I think we still have that in discussion with the conferees.

MR. TOIV: We have not agreed on phasing -- the problem he's referring to is what you were just talking -- charging the premium --

MR. MCCURRY: We have some disagreement on the phasing, how you phase in. But the we also have -- remember, you heard the President talk about this earlier -- we don't believe you subject the test up to 100 percent of the benefit, either. We both believe it should be in the level of 75 percent, I think we suggest; maximum should be 75 percent.

Q Do you have anything specific on the table with regard to means testing?

MR. MCCURRY: With respect to this? No. We're clearly discussing with them how we can proceed in a good-faith effort to try to implement this concept in the agreement because it's been voted for now by the Senate and the Senate Republicans in particular feel very strongly about this in conference. We're trying to work with them to see if we can't include this element in the final legislation that's negotiated. We're going to them with some ideas, clearly still skeletal, about how we would make it work.

Q But if you were really in a serious effort with the Republicans, particularly in the Senate, to reach an agreement on means testing, shouldn't you by now have put on the table exactly what the specifics of your means testing proposal --

MR. MCCURRY: No. I mean, Leo, this came out of the clear blue during Senate Finance Committee markup and it was considered on the Floor. This is a very late -- not very long ago, not very long ago and the degree to which it was going to be embraced by the House conferees I think is fair to say still very much in question even on the Republican side. But we're where we are. We want to see if we can work on it and we know that there are elements within the conference that feel strongly about it, there are Republicans in the Senate that feel strongly about it, so we want to work with them to see if we can make it work. Can't -- right, there are obviously Democrats on the Senate side and in the Finance Committee who also very strongly advocated this position.

Q I was just wondering, if your negotiators today or tomorrow have any specific guidance on this matter when they engage in serious negotiations with the folks on the Hill.

MR. MCCURRY: I think they got it from the President this morning, and we're fleshing it out now as best we can.

Q Mike, on the record, what was the official recommendation from McCaffrey and from Reno, and where does the President want to kind of fall in between, between five to one and 10 to one?

MR. MCCURRY: The recommendation of the Drug Director and the Attorney General was that the trigger for a five-year mandatory drug penalty should be increased from five to 25 grams for crack and drop from 500 grams to 250 grams for powder cocaine. That would drop the ratio from the current level from 100 to one to roughly 10 to one. The President, as he said earlier, thinks that's a sensible recommendation and he certainly accepted it, but we now have to work closely with Congress to see how we would implement it.

Q Well, why not one to one?

Q What's the justification?

MR. MCCURRY: Because one to one in the view of the law enforcement community does not make sense. Parity does not reflect the fact that these are two different drugs associated with two different types of social behavior in the one case of crack, much more violent and much more dangerous to the community.

Q McCaffrey says it affects disproportionately the black community.

MR. MCCURRY: I'm telling you what the recommendation was that came forward. Both of these drugs affect all populations in the country one way or another, sometimes disproportionately in the case of some communities. But crack cocaine is associated with much more violent, much more dangerous, much more antisocial behavior.

Q Mike, when the President is saying that he accepts the recommendations, was he indicating reluctance to accept them? He didn't seem overly enthusiastic in commenting.

MR. MCCURRY: No, it's just reflecting the reality that we have to work with Congress now to see what will be enacted into law and the viewpoints on the Hill that have to be considered and we have been consulting closely with people on the Hill.

Q He doesn't think that it has much of a chance on the Hill?

MR. MCCURRY: No, I think it has a very good chance on the Hill to reduce the disparity. The disparity is clearly something that many members if not most members of Congress find objectionable and how to close the disparity is what's under consideration. This is obviously a tenfold reduction in that disparity.

Q Can we go to a different subject?

MR. MCCURRY: Absolutely. Anytime.

Q The Pacific salmon dispute -- the Premier of British Columbia has written to the President suggesting that the State Department and the Canadian government can't seem to get this thing resolved, and the Prime Minister earlier, I guess, a month ago, asked the President to help get involved in this. Given the letter from --

MR. MCCURRY: That's one version, maybe, of history.

Q Yes, but given the letter from the Premier of British Columbia, will the President take a different view, maybe throw his weight behind getting these two countries back to the bargaining table?

MR. MCCURRY: Well, the President, privately, with Prime Minister Chretien has stressed the importance of resolving this issue amicably; has suggested that both the State Department and the relevant ministries in the Canadian government should be involved in a renewed effort to solve the issues.

We should not have to go through the kind of episode we did this past weekend in which people who have no connection whatsoever with the fishing industry were not only inconvenienced, but maybe even put into some degree of hazard as a result of the dispute itself. And the President would reiterate what he has suggested privately to the Prime Minister, that it's time for negotiators to work extra hard to solve the dispute.

Q Mike, the President has a lot of time scheduled in Los Angeles and not much seems to be scheduled for him to do. What's he going to be doing?

MR. MCCURRY: I think playing golf.

Q So he has a fundraiser and --

MR. MCCURRY: It's a Sunday, so he's essentially taking that portion of Sunday off, between doing the event up in Lake Tahoe and then going out to speak to the National Governors Association Monday in Las Vegas.

Q Should we expect the Weld nomination today?


Q Mike, can you talk about the Leder's nomination?

MR. MCCURRY: Maybe tomorrow. Maybe. Check in on that tomorrow. Soon.

Q Leder nomination?

MR. MCCURRY: Phil Leder?

Q Yes.

MR. MCCURRY: The President believes that Phil Leder, who has got enormous wealth of experience within this administration, both here at the White House, at the Small Business Administration and who has worked on so many interesting international efforts on behalf of the administration will be an excellent Ambassador to the Court of St. James.

Q How many times has the President attended the Renaissance Weekend?

MR. MCCURRY: I have no idea. I think -- the beginning. And he certainly credits Mr. Leder with having a brilliant idea in setting it up.

Q This conference this week at the -- small arms trafficking, on an agreement to limit the illegal traffic of small arms in the hemisphere, how important, how interested is the administration in that agreement?

MR. MCCURRY: I know that within the administration we've worked a great deal on it and I've seen some discussions at the State Department on it. I'd have to check further with people who are following it here at the White House. But we have enormous interest generally in the question of conventional military balance, conventional arms balances in the region. We believe we have structured our own policy with respect to sales and exports carefully to acknowledge some of the concerns about balance. And, of course, we are most interested in illegal or illicit arms smuggling and arms trafficking and we work closely with governments of the OAS to advance those concerns.

Q The President said he was spending a lot of time in the last few days with the Boeing situation. Can you elaborate a little bit on that, on the call --

MR. MCCURRY: He's been following the discussions that have been underway. He's made a handful of calls himself. He's obviously been trying to impress upon European leaders the relevant criteria evaluated by our own Independent Federal Trade Commission, which looked at the competitive economic aspects of the proposed merger. And that's the basis upon which he believes the European Commission consider the matter. We remain hopeful there will be some resolution of the question prior to the anticipated vote by the EC tomorrow.

Q Who are some of the people he's talked to?

MR. MCCURRY: I'm not -- the President has had good conversations with those that he believes are in a position to be helpful in advancing the discussions within the European Union.

Q How many calls has he made?

MR. MCCURRY: He's made two that I know of and may have made some more by now.

Q What if it's turned down? What if the EU turns it down? Then what?

MR. MCCURRY: Well, the President has suggested and others in the administration have suggested that we do have some remedies and we could pursue our concerns within the World Trade Organization. But it also would depend in part on any response -- or, the response, if any, that would be forthcoming from the Commission.

Q Mike, just what is going on between now and tomorrow to try to head off what the President describes as a trade conflict --

MR. MCCURRY: Those of you who have followed the discussions know that there have been -- I think in Brussels, right? -- almost around-the-clock negotiations that have been underway, and we are -- both we are represented and representatives of Boeing and McDonnell Douglas are also represented in private capacities.

Q Mike, it's been reported that Mike Espy has gotten a target letter. Does the White House have any reaction?

MR. MCCURRY: I don't have any comment. To my knowledge, no one here is familiar with whether or not that's true.

Q What's up for tomorrow?

MR. MCCURRY: Come back to that. One last question. What are we doing tomorrow? (Laughter.) Child health, yes. We're protecting the health of children and we've got some things -- the President will have some things to report on immunization levels, and we're looking forward to see what we can do more broadly to advance the subject of health care in America. You know the President and the First Lady have indicated there will be a conference at the White House later in the year on child health care issues -- child care issues, more broadly defined. I think the President will have some things to say about that as well.

Q Mike, could you talk about the 5:30 p.m. meeting with gay and lesbian groups?

MR. MCCURRY: The President has had a -- is planning a series of outreach meetings to leaders in various communities. He has already met, I believe, with leadership of the Hispanic community. He has, in connection with his initiative on race, met with many representatives of African American organizations. This afternoon, he'll meet with leaders in the gay and lesbian community. I expect in coming weeks he'll be
continuing this effort
to kind of
reach out.

Q What will be the issue there?

MR. MCCURRY: There are a lot of them.

Q Don't ask, don't tell?

MR. MCCURRY: No. The Employment Discrimination Act in particular, which I think is a very high priority of that community. There are lists of about a half-dozen or so issues I think the President anticipates talking with them about.

Q Do you know off-hand what the level of professional appointments to political appointments for ambassadorships under this President?

MR. MCCURRY: Off-hand, I don't. I think that we have done as well as if not somewhat better than prior administrations in the ratio of career appointees to political appointees, which is something the President felt keenly about and I think on balance -- on balance, obviously, we have a much higher percentage of career foreign service officer appointees to ambassadorships than we do political appointees.

Q Is there any update on Felix Rohatyn?

MR. MCCURRY: Yes, he's been nominated. He was nominated I guess two days ago.

THE PRESS: Thank you.

END 2:10 P.M. EDT