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Office of the Press Secretary

For Immediate Release February 28, 2000
                           PRESS BRIEFING BY
                              JOE LOCKHART

                 The James S. Brady Press Briefing Room

1:10 P.M. EST

MR. LOCKHART: Welcome back to the daily briefing. Let me just give you a little readout. I know you saw the President's portion of the governors' meeting this morning. He, in that session, as you know, focused on issues including the new economy, health care, oil prices, and the general problem we've had particularly in the Northeast with rising home heating oil.

In the session, the closed session, there were a number of subjects discussed, but I think primarily the two main subjects were China and WTO and the new economy, particularly in respect to Internet taxation. There was a general bipartisan consensus among the governors in support of the China WTO deal and the permanent normal trade relations legislation that the House and the Senate will be considering later this year. We heard from Governors Locke, Thompson, Glendening, Schafer from North Dakota, among others, speaking strongly in support for the deal.

On Internet, several governors weighed in from a variety of angles. Governor Hunt talked about how the Internet, the new economy, is an education issue and the key to education in the future; talked about the shortage of teachers and the need to get them trained on the Internet. Governor Davis talked about technology being critical to our economic growth. Then a number of governors talked about the need to make sure that we continue to deal and grapple with the various issues surrounding taxation on the Internet.

Q Does the President believe in taxation on the Internet?

MR. LOCKHART: Well, the President has made clear that he is against access taxes for the Internet and against any discriminatory taxes for the Internet. On the difficult issue of sales tax, I think he told the governors that this is an issue that we're going to have to work out together and that we're going to have to work on with some urgency. And I think he got a fairly receptive response on that. This is obviously something that has dominated the discussions the governors have had amongst themselves over the last few days.

Q But Joe, outside they said that he agreed with them that there should be no federal preemption on the sales tax on the Internet.

MR. LOCKHART: He said that this is an issue that they're going to have to work out among the states.

Q So, in other words, he agrees there should be no federal preemption of the states rights to decide on their own whether there is going to be --

MR. LOCKHART: He believes that the states should do this, yes. And he believes that it may involve some simplification -- it may have to involve some simplification of sales tax. But this is something that they will have to work out with some urgency as we move forward.

Q Will he support any future moves to extend the moratorium on Internet taxes?

MR. LOCKHART: Well, certainly the moratorium that exists now is on access and discriminatory, and he supports banning those. I don't know how the moratorium actually works, but he is against any of those taxes being imposed.

Q Would he then oppose, because of his views on federal preemption, would he oppose federal law saying states can't tax Internet sales?

MR. LOCKHART: Well, I think the states are working through a process to resolve and simplify this issue. This is obviously something that's going to come down the road because it's not going to be resolved in the next few months, but it's just something that he thinks the burden is on the states to resolve.

Q Economically speaking, does the President believe this is a zero sum game, that if you don't collect sales tax revenue you get nothing out of the new economy, and that the very loss of the sales tax revenue is so big in certain states that they can't recoup it any other way? Governor Davis said, look, a lot of states are gaining tremendously in other ways because of the new economy -- jobs, more revenue, so on and so forth.

MR. LOCKHART: Well, I think it's something that, obviously, there is some disagreement among the governors on, but it's obviously something that has to be worked out, because there are -- as this part of the new economy continues to grow, there are implications as far as states and their revenues. So it's something that has to be resolved.

Q The President apparently offered to act as the intermediary between the governors and some of the high-tech industries. Is that something that you guys have thought out further than that? And do you think that will happen any time in the relative near future?

MR. LOCKHART: Well, I think, obviously, we have good relations both with the state governments and with the high-tech industry. And to the extent that we can offer the level of trust that exists, it's something the President is willing to do.

Q What did he promise the Governor of Puerto Rico? He had a discussion on Vieques?

MR. LOCKHART: The governor of Puerto Rico met with Mr. Podesta and the first step in the overall resolution of the issue was taken today. I think it was about 110 acres -- the deed was handed over to help extend the airport to help promote tourism. There is obviously a number of other steps that will have to be taken including a referendum where the people of Vieques will decide their future, but that's somewhat down the road.

Q And money?

MR. LOCKHART: Well, there is money in the budget, I think $40 million, to deal with a whole list of issues that was part of the arrangement in the discussions between the Pentagon, the White House, and the representatives of Puerto Rico.

Q Joe, Governor Leavitt said on this Internet tax issue thing that one of the things the states should look at is whether the sales tax remains a viable tool for raising revenue in the 21st century economy. The President was a governor of a state that relied on sales tax revenue. Does he have any particular opinion based on his knowledge of the Internet economy as to whether or not sales tax revenues are the way to go anyway?

MR. LOCKHART: Well, I think this is going to generate an overall debate on sales tax and how it can work and be simplified so that it does work with the technology in this new economy. And this is something that the governors are going to have to work very closely together on over the next few years. As far as particular views that the President has, I don't know that he's got any special expertise on that particular issue except that this is obviously something that has to get worked out, because it's not something that we can afford not to address, and I think each and every governor understands that.

Q So, Joe, is this something that the federal government has no voice on, it's completely a state's right issue?

MR. LOCKHART: I think states have the obligation to try to work through this. I can't tell you that down the road that the federal government has no role in it. The federal government could play some role, but right now I think the President's point was that the governors have the burden upon themselves to try to work through this issue.

Q And if they decide that there should be an Internet tax or there shouldn't be, that's okay with the President, whichever way it comes out?

MR. LOCKHART: Well, I think he's got to work with the governors, and I think he will continue to do so, and I think I'll avoid answering an "if" based on what they might decide.

Q Joe, the International Monetary Fund, there's a poll tomorrow of apparently members to head the organization. Is the United States going to vote in that, and does it have a position -- who will the United States support in it?

MR. LOCKHART: Well, I know that there's a candidate that the United States will support. Let me address some of the reporting -- there has been some reporting on the German candidate.

The President spoke to Chancellor Schroeder on Saturday on the telephone. In that call, he stressed the importance of the IMf managing director position and the need for a strong candidate of maximum stature who would be able to command broad support from around the world. In that context, the President told Chancellor Schroeder that the United States is not prepared to support the German candidate. Our objective remains to work with Europe to find a strong European candidate who is able to command broad support, including from the emerging markets countries.

Q So he doesn't think the German candidate would be any good?

MR. LOCKHART: We don't believe that he meets the criteria for a strong candidate of maximum stature, who would be able to command broad support from around the world.

Q Joe, does the President consider under any circumstances an American as head of the IMF? I know you said that you want to find a European, but if that doesn't work out?

MR. LOCKHART: I can tell you what our position is, and our position is that we believe this should be a European candidate who commands broad support.

Q Joe, I heard one of the governors say that the President indicated that releasing oil from the strategic reserves is still an option that is on the table. Can you clarify that? Because I got the impression that was something you were not considering at this time.

MR. LOCKHART: No, I think we have taken a number of steps which we've outlined over the last three weeks, as far as LIHEAP and a supplemental bill, providing more funds. At this point in time, that's not an option that we're considering.

Q It's not on the table then, at all?

MR. LOCKHART: At this point in time, it is not an option that we're considering doing.

Q Wait a minute -- the President seems to have gone out of his way in his statements to say that he's not closing off any options.

MR. LOCKHART: Right. And that's why I said at this point in time.

Q Joe, you took a question on Friday as to whether or not the U.N. had changed the import status of Iraq and --

MR. LOCKHART: I assumed that had been answered and it wasn't directed to me. So I will get it for you right after the briefing.

Q Now that Bill Richardson is back from his trip to the oil exporting countries, does the President intend to meet with him and discuss this amply?

MR. LOCKHART: I think his staff and the staff over here at the White House has been in pretty close contact, so I'm not aware that there is a meeting any time soon.

Q Joe, what can you tell us about the Medicare demographic study that will be released tomorrow? What's the nature of it?

MR. LOCKHART: Well, I think it will provide you with a comprehensive picture of the position of Medicare today and as we move into the future, and the overall need for some reforms within the system and the overall need for a real prescription drug benefit.

Q Is this sort of new projections as to when money runs out, doesn't run out, when there will be enough, when there wouldn't be enough in various states?

MR. LOCKHART: I think it provides you with, among other things, a state by state look of who benefits from it, how the population is growing and the needs will increase and the overall underlying decisions that need to be made to reform Medicare and provide prescription drugs and the kind of resources that will need to go to do that.

Q Joe, the Senate will vote probably Wednesday on education savings accounts. Several Democrats support that. I think the latest vote count, pre-cloture, 62 votes. Why does the administration think it's a bad idea for people to set aside money on their own, to try to help their own children as far as their education outside of the public school system?

MR. LOCKHART: Well, because we believe what the priorities should be, the federal government's priorities should be, making sure that our public schools are the best they can be. We have a vast majority of the public who attend public schools and we believe that should be our priority and we shouldn't drain away resources through this or through voucher programs that will divert resources from public schools.

Q -- people setting aside their own money.

Q Why are you diverting them, and they're still paying taxes -- they still have to pay their school taxes.

MR. LOCKHART: Well, we believe that this, as among other steps, does not go to address the educational problems in the country.

Q Joe, does the President agree with Senator Bill Bradley's call on Paramount to deny Dr. Laura a TV show because she adheres to the Roman Catholic, Greek Orthodox, Southern Baptist and Orthodox Jewish belief on homosexuality?

MR. LOCKHART: Who is Dr. Laura?

Q She's the second most widely syndicated talk show host in the United States.

MR. LOCKHART: Lester, please don't tell me you're the first. (Laughter.) See, sometimes I can ask leading questions. (Laughter.)

Q Does he agree with this, or is he concerned about the First Amendment in the light of the censorship inclinations of this candidate for the presidency?

MR. LOCKHART: I have not heard him express any view on this subject and I'm not sure he's aware at all.

Q What's your view, Joe, as his principal media? Would you support having her denied a TV show?

MR. LOCKHART: Lester, I think if you can have a radio or TV show, then anyone can. (Laughter.)

Q Can I have a follow-up? (Laughter.) Does the President believe it was appropriate for the Governor of Texas to write Cardinal O'Connor yesterday, explaining why he visited Bob Jones, when candidates Gore and Bradley have not written anybody explaining why they visited Al Sharpton?

MR. LOCKHART: Again, I have not asked him that question and I think it's -- I don't think his point of view is all that relevant here. This is something between Governor Bush and the Cardinal.

Q But do you, as his advisor --

MR. LOCKHART: I don't make the same connection you do.

Q -- do you believe that Sharpton is morally superior to Jones?

MR. LOCKHART: I haven't made any such judgments, nor do I plan to.

Q You'd rather move away from that one.

MR. LOCKHART: That's exactly right.

Q Do you have any more information on the trip this weekend to California, the San Francisco event?

MR. LOCKHART: I should have something to announce, if not by later today, by tomorrow. But we'll do an event that I think will take advantage of the preponderance of the high-tech community in that area.

Q Joe, the Amtrak money, is that part of a supplemental request -- the stuff the Secretary Slater announced just a few moments ago out on the lawn about asking for additional money for Amtrak?

MR. LOCKHART: I don't know the answer to that. Let me check. My understanding was that this was part of this year's budget. But let me check to make sure.

Q I thought he said it was additional to that.

MR. LOCKHART: I'll find out.

Q What's the President going to do in Selma?

MR. LOCKHART: Well, it's the 35th anniversary of the march across, so there will be -- he and many other leaders, both political leaders and leaders in the civil rights community, will walk across the bridge, and then have an event where they can remember the important contribution they made to the civil rights movement.

Q This Medicare report you are putting out tomorrow -- is this something that comes up annually, or is it something you might kick-start talks on long-term solvency or cutting down --

MR. LOCKHART: Well, I think talks are already -- I mean, these kinds of numbers are available, I believe, on an annual basis. But I think there is already a debate going on. The question is getting it done. I think in the Senate tomorrow they will begin hearings on Medicare reform, prescription drugs; these are issues that this Congress the President believes should be taken up this year. And if packaging this information focuses attention on it, it's all for the better.

Q -- the President obviously supports assistance like this at the college level. What is the philosophical difference between -- people setting money aside for their children in the K through 12 years?

MR. LOCKHART: Because we believe that the federal government's --

Q Their own money, not federal government --

MR. LOCKHART: I understand. But it does subsidize going to school outside the context of public schools. And the President believes that that's the appropriate way for the federal government to be involved in education.

Thank you.

END 1:30 P.M. EST