    [Public Papers of the Presidents of the United States: George W. Bush (2007, Book II)]
    [October 17, 2007]
    [Pages 1327-1340]
    [From the U.S. Government Publishing Office www.gpo.gov]

    The President's News Conference
    October 17, 2007

        The President. Good morning. We're now more than halfway through
    October, and the new leaders in Congress have had more than 9 months to
    get things done for the American people. Unfortunately, they haven't
    managed to pass many important bills. Now the clock is winding down, and
    in some key areas, Congress is just getting started.
        Congress has work to do on health care. Tomorrow Congress will hold
    a vote attempting to override my veto of the SCHIP bill. It's unlikely
    that that override vote will succeed, which Congress knew when they sent
    me the bill. Now it's time to put politics aside and seek common ground
    to reauthorize this important program. I've asked Health and Human
    Services Secretary Mike Leavitt, National
    Economic Council Director Al Hubbard, and
    OMB Director Jim Nussle to lead my
    administration's discussions with the Congress. I made clear that if
    putting poor children first requires more than the 20-percent increase
    in funding I proposed, we'll work with Congress to find the money we
    need. I'm confident we can work out our differences and reauthorize
    SCHIP.
        Congress has work to do to keep our people safe. One of the things
    Congress did manage to get done this year is pass legislation that began
    modernizing the Foreign Intelligence Surveillance Act. FISA is a law
    that our intelligence professionals use to monitor the communications of
    terrorists who want to do harm to our people. The problem is that
    Congress arranged for the measure they passed to expire this coming
    February. In addition, the House is now considering another FISA bill
    that would weaken the reforms they approved just 2 months ago. When it
    comes to improving FISA, Congress needs to move forward, not backward,
    so we can ensure our intelligence professionals have the tools they need
    to protect us.
        Congress has work to do on the budget. One of Congress's basic
    duties is to fund the day-to-day operations of the Federal Government.
    Yet Congress has not sent me a single appropriations bill. Time is
    running short, so I urge the Speaker and the
    leader of the Senate to name conferees for six of
    the annual appropriations bills that have already passed the House and
    the Senate. The two Houses need to work out their differences on these
    bills and get them to my desk as soon as possible. They also need to
    pass the remaining spending bills, one at a time and in a fiscally
    responsible way.
        Congress has work to do on education. As we saw from the recent
    Nation's Report Card, the No Child Left Behind Act is getting results
    for America's children. Test scores are rising. The achievement gap is
    beginning to close. And Congress should send me a bipartisan bill that
    reauthorizes and strengthens this effective piece of legislation.
        Congress has work to do on housing. Back in August, I proposed a
    series of reforms to help homeowners struggling with their mortgage
    payments. More than 6 weeks later, Congress has yet to finish work on
    any of these measures. These are sensible reforms that would help
    American families stay in their homes, and Congress needs to act quickly
    on these proposals.

    [[Page 1328]]

        Congress has work to do on trade. Earlier this year, my
    administration reached out to the Congress, and we forged a bipartisan
    agreement to advance trade legislation. Now Congress needs to begin
    moving on trade agreements with Peru, Colombia, Panama, and South Korea.
    These agreements expand access to overseas markets, they strengthen
    democratic allies, and they level the playing field for American
    workers, farmers, and small businesses.
        Congress has work to do for our military veterans. Yesterday I sent
    Congress legislation to implement the Dole-
    Shalala Commission's recommendations that
    would modernize and improve our system of care for wounded warriors.
    Congress should consider this legislation promptly so that those injured
    while defending our freedom can get the quality care they deserve.
        Congress also needs to complete the Veterans Affairs appropriations
    bill that funds veterans' benefits and other ongoing programs. Look, we
    have our differences on appropriations bills, but the veterans' bill is
    where we agree. So I ask Congress to send me a clean bill that will fund
    our veterans, a bill without unnecessary spending in it. And they need
    to get this work done, and I hope they can get it done by Veterans Day.
    It seems like a reasonable request on behalf of our Nation's veterans.
        Congress has work to do for law enforcement and the judiciary. I
    want to thank the Senate Judiciary Committee for beginning hearings
    today on Judge Mukasey's nomination to
    serve as the Attorney General. I urge the committee to vote on that
    nomination this week and send it to the full Senate for a vote next
    week. The Senate also needs to act on the many judicial nominations that
    are pending and give those nominees an up-or-down vote. Confirming
    Federal judges is one of the most important responsibilities of the
    Senate, and the Senate owes it to the American people to meet that
    responsibility in a timely way.
        With all these pressing responsibilities, one thing Congress should
    not be doing is sorting out the historical record of the Ottoman Empire.
    The resolution on the mass killings of Armenians beginning in 1915 is
    counterproductive. Both Republicans and Democrats, including every
    living former Secretary of State, have spoken out against this
    resolution. Congress has more important work to do than antagonizing a
    democratic ally in the Muslim world, especially one that is providing
    vital support for our military every day.
        It's little time left in the year, and Congress has little to show
    for all the time that has gone by. Now is the time for them to act. And
    I look forward to working with members of both parties on important
    goals that I've outlined this morning.
        And now I look forward to taking some of your questions, believe it
    or not. [Laughter]

    Turkey/Situation in Iraq

        Q. Mr. President, Turkey's parliament is debating sending military
    forces into Iraq to pursue Kurdish rebels. Do you think that Turkey has
    the legitimate right to stage a cross-country offensive--cross-border
    offensive?
        The President. I've talked to Ambassador Crocker and General Petraeus about
    this issue this morning. We are making it very clear to Turkey that we
    don't think it is in their interests to send troops into Iraq. Actually,
    they have troops already stationed in Iraq, and they've had troops
    stationed there for quite awhile. We don't think it's in their interests
    to send more troops in.
        I appreciate very much the fact that the Iraqi Government
    understands that this is a sensitive issue with the Turks, and that's
    why Vice President Hashimi is in Istanbul
    today talking with the Turkish leaders to assure them that Iraq shares
    their concerns about terrorist activities, but that there's a better way
    to deal with the issue than having the Turks send massive troops into
    the

    [[Page 1329]]

    country--massive additional troops into the country.
        What I'm telling you is, is that there's a lot of dialog going on,
    and that's positive. We are actively involved with the Turks and the
    Iraqis through a tripartite arrangement, and we'll continue to--
    dialoguing with the Turks.
        Q. Thank you, Mr. President.
        The President. Matt [Matt Spetalnick, Reuters].

    Dalai Lama's Congressional Gold
    Medal Ceremony

        Q. Thanks. Why are you going to attend the congressional award
    ceremony for the Dalai Lama today when China----
        The President. Why am I--when am I, or why am I?
        Q. Why are you going to, when China has expressed outrage about it?
    And what, if any, potential damage do you see to U.S.-China relations,
    considering that you need their support on dealing with Iran and North
    Korean nuclear issues?
        The President. One, I admire the Dalai Lama a lot. Two, I support
    religious freedom; he supports religious freedom. Thirdly, I like going
    to the gold medal ceremonies. I think it's a good thing for the
    President to do, to recognize those who the Congress has honored. And
    I'm looking forward to going.
        I told the Chinese President, President Hu,
    that I was going to go to the ceremony. In other words, I brought it up.
    And I said, I'm going because I want to honor this man. I have
    consistently told the Chinese that religious freedom is in their
    nation's interest. I've also told them that I think it's in their
    interest to meet with the Dalai Lama and will say so at the ceremony
    today in Congress. If they were to sit down with the Dalai Lama, they
    would find him to be a man of peace and reconciliation. And I think it's
    in the country's interest to allow him to come to China and meet with
    him.
        So my visit today is not new to the Chinese leadership. As I told
    you, I brought it up with him. I wanted to make sure he understood
    exactly why I was going. And they didn't like it, of course, but I don't
    think it's going to damage--severely damage relations. A matter of fact,
    I don't think it ever damages relations when the American President
    talks about religious tolerance and religious freedom is good for a
    nation. I do this every time I meet with him.
        David [David Gregory, NBC News]. Welcome back.

    Israel and Syria

        Q. Mr. President, last time you used that line and we were here--
    [laughter]----
        The President. But you know something, the interesting thing about
    it is, it works every time because--[laughter]----
        Q. I know.
        The President. ----because there's a grain of truth. [Laughter] I
    won't use it again, though. [Laughter]
        Q. There's a report today from Israel Army Radio indicating that the
    Syrians have confirmed that the Israelis struck a nuclear site in their
    country. You wouldn't comment on that before, and I'm wondering if now,
    on the general question, you think it's appropriate for Israel to take
    such action if it feels that the--there is mortal danger being posed to
    the state?
        The President. David, my position hadn't changed.
        Q. Can I ask you whether you----
        The President. You can ask me another question.
        Q. Did you support Israel's strike in 1981 on the Iraqi reactor
    outside Baghdad?
        The President. You know, Dave, I don't remember what I was doing in
    1980. Let's see, I was living in Midland, Texas; I don't remember my
    reaction that far back.
        Q. Well, but as you look at it as President now----

    [[Page 1330]]

        The President. ----private citizen back there in 1981 in Midland,
    Texas, trying to make a living for my family and----
        Q. But you're a careful--someone who studies history----
        The President. Student of history? I do, yes. No, I don't remember
    my reaction, to be frank with you.
        Q. But I'm asking you now, as you look back at it, do you think it
    was the right action for Israel to take?
        The President. David, I'm not going to comment on the subject that
    you're trying to get me to comment on.
        Q. Why won't you? But isn't it a fair question to say, is it--given
    all the talk about Iran and the potential threat--whether it would be
    appropriate for Israel to act----
        The President. Hey, Dave--Dave----
        Q. ----in self-defense----
        The President. I understand----
        Q. ----if Iran were to----
        The President. I understand where you're trying to take----
        Q. ----develop nuclear weapons?
        The President. I understand where you're trying to take. It's a
    clever ruse to get me to comment on it, but I'm not going to. Thank you.
        Q. Well, I'm just wondering why you think it's not appropriate to
    make that judgment when it's a--it is a real-world scenario, as we know,
    since they apparently took this action against Syria----
        The President. Dave, welcome back. [Laughter]

    Iran-Russia Meeting

        Q. Good morning, Mr. President. Thank you. I don't know if you saw
    the picture on the front page of one of the papers this morning of
    Mahmud Ahmadi-nejad and Vladimir Putin.
        The President. I did.
        Q. It looked like they were getting along pretty well. And they are
    among five leaders----
        The President. Surprised they weren't, kind of, fighting each other
    on the front page of the paper? No, man, come on. [Laughter]
        Q. They looked like they were enjoying each other's company. And I'm
    wondering, since there were leaders of five Caspian Sea region nations
    that have now declared each country will not be used as a base to attack
    the other, A, what do you make of their growing relationship; B, does it
    complicate what the United States can do in the region; and C, would you
    characterize that arrangement as some sort of ``Caspian Sea Truman
    Doctrine'' or something like that?
        The President. You know, I think it's hard to judge how their
    conversations went from a picture. Generally, leaders don't like to be
    photographed scowling at each other or making bad gestures at each
    other. So I'm not surprised that there was a nice picture of them
    walking along. I try to make sure that when I'm with foreign leaders,
    there's a pretty picture of the two of us walking down the colonnades,
    or something like that, to send a good message. And so----
        Q. Are you saying it's not so warm?
        The President. Well, I don't know yet. What I'm about to tell you
    is, is that I'm looking forward to getting President Putin's readout from the meeting. I think one of the--the
    thing I'm interested in is whether or not he continues to harbor the
    same concerns that I do. And I say ``continues'' because when we were in
    Australia, he reconfirmed to me that it is--he recognized it's not in
    the world's interest for Iran to have the capacity to make a nuclear
    weapon. And they have been very supportive in the United Nations, and
    we're working with them on a potential third resolution.
        So that's where my concerns--I don't worry about the pictures. I
    understand why they meet. I am--will continue to work with Russia, as
    well as other nations, to keep a focused effort on sending Iran a
    message that--``You will remain isolated if

    [[Page 1331]]

    you continue your nuclear weapons ambitions.''
        Q. But this declaration doesn't speak to that, Mr. President. This
    declaration doesn't suggest isolation for Iran; just the opposite, that
    Russia and Iran are going to do business.
        The President. Well, we'll find out. See, that--you're trying to get
    me to interpret the meeting based upon a news story or a picture. I'd
    rather spend some time with Vladimir Putin
    finding out exactly what went on. Thank you.

    Six-Party Talks

        Q. Let's stay with the nuclear thing here. When North Korea tested a
    nuclear device, you said that any proliferation would be a grave threat
    to the U.S., and North Korea would be responsible for the consequences.
    Are you denying that North Korea has any role in the suspected nuclear
    facilities in Syria?
        The President. See, you're trying to pull a Gregory.
        Q. Yes, I am.
        The President. Okay, well, I'm not going to fall for it. But I'd
    like to talk about----
        Q. Don't Americans have a right to know about who is proliferating,
    especially when you're negotiating with North Korea?
        The President. No, you have a right to know this, that when it comes
    to the six-party talks, proliferation--the issue of proliferation is--
    has equal importance with the issue of weaponry, and that North Korea
    has said that they will stop proliferating, just like they have said
    they will fully disclose and disable any weapons programs.
        Step one of that has been dealing with shuttering Pyongyang. Step
    two will be full declaration of any plutonium that has been manufactured
    and/or the construction of bombs, along with a full declaration of any
    proliferation activities. And in my judgment, the best way to solve this
    issue with North Korea peacefully is to put it in the--keep it in the
    context of the six-party talks. And the reason why is that diplomacy
    only works if there are consequences when diplomacy breaks down. And it
    makes sense for there to be other people at the table so that if North
    Korea were to have said to all of us, ``We're going to do x, y, or z,''
    and they don't, that we have other--people other than the United States
    being consequential.
        There's a lot of aid that goes on with--between North Korea and
    China, or North Korea and South Korea, and therefore, if they renege on
    their promises--and they have said--they have declared that they will
    show us weapons and get rid of the weapons programs as well as stop
    proliferation--if they don't fulfill that which they've said, we are now
    in a position to make sure that they understand that there will be
    consequences.
        And I'm pleased with the progress we're making. There's still work
    to be done? You bet there's work to be done. Do I go into this thing
    saying, well, you know, gosh, the process is more important than
    results? I don't. What matters most to me are whether or not we can
    achieve the results that I've said we're hoping to achieve. And if not,
    there will be consequences to the North Koreans.
        Q. Was Syria part of those talks? Is Syria part of the talks?
        The President. Proliferation is a part of the talks.
        Q. Including Syria?
        The President. Elaine [Elaine Quijano, Cable News Network].
        Look, in all due respect to you and Gregory, this is not my first
    rodeo. [Laughter] And I know where you're trying to get me to comment.
    I'm not going to comment on it, one way or the other.
        Elaine.
        Q. But, Mr. President, your administration has talked about mushroom
    clouds in the----
        The President. Thank you, Martha [Martha Raddatz, ABC News]. Martha,
    thank you. Elaine.

    [[Page 1332]]

    Military Operations in Iraq

        Q. Mr. President, on Iraq, you've talked repeatedly about the threat
    of Al Qaida in Iraq. And we've also heard a lot about the military
    progress that's been made against that group. Can you tell Americans how
    close the United States is to declaring victory against that group? And
    if you're not able to do so, does that suggest that your critics are
    correct that this war cannot be won militarily?
        The President. The Iraq situation cannot be won by military means
    alone. There has to be political reconciliation to go with it. There has
    to be a emergence of a democracy. That's been my position ever since it
    started.
        Al Qaida is still dangerous. They're dangerous in Iraq; they're
    dangerous elsewhere. Al Qaida is not going to go away anytime soon.
    That's why it's important for us to be finding out what their intentions
    are and what are their plans, so we can respond to them. This is a--this
    war against Al Qaida requires actionable intelligence. That's why this
    FISA bill is important. And they still want to do us harm, Elaine, and
    they're still active. Yes, we've hurt them bad in Iraq, and we've hurt
    them bad elsewhere. If you're the number-three person in Al Qaida,
    you've had some rough goes--you've been captured or killed. And we're
    keeping the pressure on them all the time.
        And so yes, we're making progress. But, no, I fully understand those
    who say you can't win this thing militarily.
        Q. Sir, does that suggest----
        The President. That's exactly what the United States military says,
    that you can't win this military. That's why it's very important that we
    continue to work with the Iraqis on economic progress as well as
    political progress.
        And what's happened is--in Iraq is, there's been a lot of political
    reconciliation at the grassroots level. In other words, people that
    hadn't been talking to each other are now talking to each other. They're
    beginning to realize there's a better future than one of--that one--with
    a country with deep sectarian divide. And what's going to end up
    happening is, is that the local reconciliation will affect the national
    Government. In the meantime, we're pressing hard to get the national
    Government to complete the strategic partnership with the United States
    as well as pass meaningful legislation, like the de-Ba'ath law or the
    Provincial government law or the oil revenue sharing law.
        Bret [Bret Baier, FOX News].

    Troop Levels in Iraq

        Q. Sir, given that--what you just laid out, should the American
    people be prepared for a large number of U.S. forces to remain in Iraq
    after you are finished with your Presidency?
        The President. The troop levels in Iraq will be determined by our
    commanders on the ground and the progress being made. Thank you.

    Iran-Russia Meeting

        Q. Mr. President, I'd like to follow on Mr.--on President Putin's
    visit to Tehran, not about the image of President Putin and President
    Ahmadi-nejad, but about the words that Vladimir Putin said there. He
    issued a stern warning against potential U.S. military action against
    Tehran----
        The President. Did he say ``U.S.''?
        Q. Yes.
        The President. Oh, he did?
        Q. And he said--well, at least the quote said that. And he also
    said, quote, he ``sees no evidence to suggest Iran wants to build a
    nuclear bomb.'' Were you disappointed with that message? And does that
    indicate possibly that international pressure is not as great as you
    once thought against Iran abandoning its nuclear program?
        The President. I--as I say, I look forward to--if those are, in
    fact, his comments, I look forward to having him clarify those, because
    when I visited with him, he understands
    that it's in the world's interest to

    [[Page 1333]]

    make sure that Iran does not have the capacity to make a nuclear weapon.
    And that's why on--in the first round at the U.N., he joined us, and
    second round, we joined together to send a message. I mean, if he wasn't
    concerned about it, Bret, then why did we have such good progress at the
    United Nations in round one and round two?
        And so I will visit with him about it. I have not yet been briefed
    yet by Condi or Bob Gates about, you know, their visit with Vladimir Putin.

    Iran

        Q. But you definitively believe Iran wants to build a nuclear
    weapon?
        The President. I think so long--until they suspend and/or make it
    clear that they--that their statements aren't real, yes, I believe they
    want to have the capacity, the knowledge, in order to make a nuclear
    weapon. And I know it's in the world's interest to prevent them from
    doing so. I believe that the Iranian--if Iran had a nuclear weapon, it
    would be a dangerous threat to world peace.
        But this is--we got a leader in Iran
    who has announced that he wants to destroy Israel. So I've told people
    that if you're interested in avoiding world war III, it seems like you
    ought to be interested in preventing them from have the knowledge
    necessary to make a nuclear weapon. And I take the threat of Iran with a
    nuclear weapon very seriously, and we'll continue to work with all
    nations about the seriousness of this threat. Plus, we'll continue
    working the financial measures that we're in the process of doing. In
    other words, I think--the whole strategy is, is that at some point in
    time, leaders or responsible folks inside of Iran may get tired of
    isolation and say, ``This isn't worth it.'' And to me, it's worth the
    effort to keep the pressure on this Government.
        And secondly, it's important for the Iranian people to know we
    harbor no resentment to them. We're disappointed in the Iranian
    Government's actions, as should they be. Inflation is way too high;
    isolation is causing economic pain. This is a country that has got a
    much better future; people have got a much better--should have better
    hope inside Iran than this current Government is providing them.
        So it's a--look, it's a complex issue, no question about it. But my
    intent is to continue to rally the world to send a focused signal to the
    Iranian Government that we will continue to work to isolate you, in the
    hopes that at some point in time, somebody else shows up and says, it's
    not worth the isolation.
        Yes, ma'am.

    Middle East Peace Process/Iran

        Q. Mr. President, you are sponsoring the international peace
    conference. President Abbas said he is not going to come unless there is
    a timetable.
        The President. Who said that?
        Q. President Abbas.
        The President. Oh, yes.
        Q. Secretary Rice said that failure is not an option. You talked
    about substantial issues need to be discussed. What is the minimum
    expectation from you that you will call this conference a success? And
    what you're offering the Arab nations to encourage them to participate?
        The President. Right. Well, that's why Condi is making the trip she's making, is to explain to
    people in private, as well as in public, that, one, we're for
    comprehensive peace; two, that there is a--the meeting, the
    international meeting will be serious and substantive. In other words,
    as she said the other day, this isn't going to be just a photo
    opportunity. This is going to be a serious and substantive meeting.
        We believe that now is the time to push ahead with a meeting at
    which the Israelis and Palestinians will lay out a vision of what a
    state could look like. And the reason why there needs to be a vision of
    what a state could look like is because the Palestinians, that have been
    made promises all these

    [[Page 1334]]

    years, need to see there's a serious, focused effort to step up a state.
    And that's important so that the people who want to reject extremism
    have something to be for.
        So this is a serious attempt. And I'm pleased with the progress. And
    the reason I'm pleased is because it appears to me that President
    Abbas and Prime Minister
    Olmert are, one, talking--I know they're talking
    a lot--but they're making progress. And in order for there to be lasting
    peace, the deal has to be good for the Palestinians as well as the
    Israelis. Our job is to facilitate the process.
        Another reason I have an international meeting is to get Arab buy-in
    for a state. In other words, part of the issue in the past has been that
    the Arab nations stood on the sidelines, and when a state was in reach,
    they weren't a part of the process encouraging the parties to move
    forward. And so this is a--that's what I mean by comprehensive. It's
    comprehensive not only for what the state will look like; it's
    comprehensive in getting people in the region to be a part of the
    process. And so I'm feeling pretty optimistic about it.
        Q. [Inaudible]--would discuss refugees and Jerusalem and security
    and other issues that are----
        The President. They are--the important issue--the important thing--I
    have discussed those publicly, as you know, early on in my Presidency,
    when I articulated a two-state solution. The important thing is for the
    Israelis and the Palestinians to be discussing them. That's the
    important issue. The United States can't impose peace. We can encourage
    the development of a state. That's precisely what I have been doing
    since the early stages of my Presidency. In order for there to be a
    Palestinian state, it's going to require the Israelis and the
    Palestinians coming to an accord. We can facilitate that, but we can't
    force people to make hard decisions. They're going to have to do that
    themselves.
        And I'm encouraged; I'm encouraged from what Condi tells me is going on in the Middle East, that
    there is a--the attitude is, let's work together to see if we can't lay
    out that vision for the sake of peace between Israel and the
    Palestinians. And it's possible. I believe that we will see a democratic
    state, and I understand how hard it is. And the reason it's hard, by the
    way, is because there are extremists who don't want there to be a
    democracy in the Middle East, whether it be in Iraq or Lebanon or in the
    Palestinian Territories. That's the struggle, that when you see people
    trying to blow up the opportunity for a state to exist, you just got to
    understand, it's broader than just the Palestinian Territory. It's a
    part of this struggle, this ideological struggle in which we're engaged.
    We've got to ask ourselves, why don't they want there to be a democracy?
    And the answer is, because it doesn't fit into their ideological vision,
    ``they'' being the extremists.
        Another issue with Iran, by the way, that is of great concern to us
    is their willingness to fund groups that try to either destabilize or
    prevent the rise of a democracy. And so anyway, I'm optimistic this can
    be achieved, and we'll continue working to that end.
        Yes, Ed [Edwin Chen, Bloomberg News].

    National Economy/Housing Market/Tax Reform

        Q. Mr. President, could I ask you about a domestic matter?
        The President. Sure.
        Q. The Commerce Department reported today that the housing starts
    last month fell to the lowest level since 1993. How concerned are you
    that this housing recession will spill over into the broader economy,
    and what more can be done to prevent that from happening?
        The President. Ed, I'm encouraged by the rate of inflation, the job
    growth. We've had 49 consecutive months of uninterrupted job growth,
    which is a record here in America. I'm pleased with the fact that

    [[Page 1335]]

    our deficit is shrinking. But like our Secretary of the
    Treasury, I recognize there's softness
    in the housing market. By the way, we had growth in the GDP because of
    exports. In other words, there's positive elements of our economy. But
    no question, the housing is soft.
        And the fundamental question is, what do we do to help homeowners? I
    don't think we ought to be providing bailouts for lenders, but I do
    think we ought to put policy in place that help people stay in their
    home. And that's why this FHA modernization bill is really important,
    because it'll extend the reach of the FHA and to help more people be
    able to refinance their homes.
        Part of the issue in the housing market has been that as a result of
    asset bundling, that it's hard sometimes for people to find somebody to
    talk to, to help them refinance. In other words, in the old days, you go
    into your savings and loan, your local savings and loan, and sit down
    and negotiate a house deal, and the person with whom you negotiated
    would be around if you had financial difficulties, to say, can't you
    help me restructure? Today, the originator of the note no longer owns
    the note in many cases.
        And the securitization of mortgages actually provided a lot of
    liquidity in the market, and that's a good thing. But it also creates a
    issue here in America, and that is, how do we get people to understand
    the nature of the mortgages they bought, and how do you help people
    refinance to stay in home--stay in their home? And so that's what
    Secretary Paulson, Secretary
    Jackson have been working on,
    particularly with the private sector, to facilitate the ability to
    people to refinance.
        And finally, we need to change the tax laws. You're disadvantaged if
    you refinance your home. It creates a tax liability. And if we want
    people staying in their homes, then it seems like to me, we got to
    change the Tax Code. That's why I talked to Senator Stabenow the other day and thanked her for her sponsorship
    of an important piece of tax legislation that will enable people to more
    likely stay in their homes.
        So there's some things we can do, Ed. In the meantime, you just got
    to understand, it's going to have to work out; when you got more houses
    than you got buyers, the price tends to go down. And we're just going to
    have to work through the issue. I'm not a forecaster, but I can tell
    people that I feel good about many of the economic indicators here in
    the United States.
        Peter [Peter Baker, Washington Post].

    Russia-U.S. Relations/Democracy in Russia

        Q. Mr. President, following up on Vladimir Putin for a moment. He
    said recently that next year, when he has to step down--according to the
    Constitution--as President, he may become Prime Minister, in effect
    keeping power and dashing any hopes for a genuine democratic transition
    there. Senator McCain said----
        The President. I've been planning that myself. [Laughter]
        Q. Senator McCain said yesterday, sir, that when he looks into
    Putin's eyes, he sees a K, a G, and a B, and he would never have
    invited----
        The President. Pretty good line.
        Q. ----and he would never have invited him to Kennebunkport. And he
    said it's time we got a little tough with Vladimir Putin. I'm wondering
    if you think--is Senator McCain right? And what would it mean for
    Russian democracy if, when you leave power, assuming you do, in January
    2009--[laughter]--if Vladimir Putin is still in power?
        The President. Yes. You know, one of the interesting--well, my
    leadership style has been to try to be in a position where I actually
    can influence people. And one way to do that is to have personal
    relationships that enable me to sit down and tell people what's on my
    mind without fear of rupturing relations. And that's how I've tried to
    conduct my business with Vladimir Putin.
    We don't agree on a lot of issues;

    [[Page 1336]]

    we do agree on some. Iran is one; nuclear proliferation is another.
    Reducing our nuclear warheads was an issue that we agreed on early.
        But I believe good diplomacy requires good relations at the
    leadership level. That's why, in Slovakia, I was in a position to tell
    him that we didn't understand why he was altering the relationship
    between the Russian Government and a free press--in other words, why the
    free press was becoming less free. And I was able to do--he didn't like
    it. Nobody likes to be talked to in a way that may point up different
    flaws in their strategy. But I was able to do so in a way that didn't
    rupture relations. He was able to tell me going into Iraq wasn't the
    right thing. And to me that's good diplomacy. And so I'm--and I'll
    continue to practice that diplomacy.
        Now, in terms of whether or not it's possible to reprogram the kind
    of basic Russian DNA, which is a centralized authority, that's hard to
    do. We've worked hard to make it appear in their interests--or we made
    it clear to them that it is in their interests to have good relations
    with the West. And the best way to have good long-term relations with
    the West is to recognize that checks and balances in government are
    important or to recognize there are certain freedoms that are inviolate.
    So Russia's a complex relationship, but it's an important relationship
    to maintain.
        Q. Will you be disappointed if he stays in power after you're gone?
        The President. I have no idea what he's going to do. He--I asked him
    when I saw him in Australia. I tried to get it out of him, who's going
    to be his successor, what he intends to do, and he was wily. He wouldn't
    tip his hand. I'll tip mine: I'm going to finish--I'm going to work hard
    to the finish. I'm going to sprint to the finish line, and then you'll
    find me in Crawford.
        Sheryl [Sheryl Gay Stolberg, New York Times].

    Cooperation With Congress/Legislative Agenda

        Q. Yes, Mr. President, I'd like to turn your attention back to
    Capitol Hill. A year ago, after Republicans lost control of Congress,
    you said you wanted to find common ground. This morning you gave us a
    pretty scathing report card on Democrats. But I'm wondering, how have
    you assessed yourself in dealing with Democrats this past year? How
    effective have you been in dealing with them on various issues, and do
    you think you've done a good job in finding common ground?
        The President. We're finding common ground on Iraq. We're--I
    recognize there are people in Congress that say we shouldn't have been
    there in the first place. But it sounds to me as if the debate has
    shifted, that David Petraeus and Ryan
    Crocker's testimony made a difference to a
    lot of Members. I hope we continue to find ground by making sure our
    troops get funded.
        We found common ground on FISA. My only question is, why change a
    good law? The way that law was written works for the security of the
    country. That's what the American people want to know, by the way. Are
    we passing laws that are beneficial to the American people? This law is
    beneficial because it enables our intelligence experts to--and
    professionals to find out the intentions of Al Qaida. Now, the law needs
    to be changed, enhanced by providing the phone companies that allegedly
    helped us with liability protection. So we found common ground there.
        Hopefully, we can find common ground as the Congress begins to move
    pieces of legislation. The reason I said what I said today is, there's a
    lot to be done. As you recognize, I'm not a member of the legislative
    branch; probably wouldn't be a very good legislator. But as the head of
    the executive branch, it makes sense to call upon Congress to show
    progress and get results. It's hard to find common ground unless

    [[Page 1337]]

    important bills are moving. They're not even moving. And not one
    appropriations bill has made it to my desk. How can you find common
    ground when there's no appropriations process?
        We found common ground on a trade bill--trade bills, really
    important pieces of legislation, as far as I'm concerned. One of the
    reasons why is, exports helped us overcome the weakness in the housing
    market last quarter. If that's the case, it seems like it makes sense to
    continue and open up markets to U.S. goods and services. And yet there
    hadn't been one--there haven't been any bills moving when it comes to
    trade.
        Veterans Affairs is an area where we can find common ground. I've
    called in--I asked Bob Dole and Donna
    Shalala to lead an important Commission, a
    Commission to make sure our veterans get the benefits they deserve. I
    was concerned about bureaucratic delay and the--concerned about a system
    that had been in place for years, but this didn't recognize this
    different nature--a different kind of war that we're fighting.
        I don't like it when I meet wives who are sitting by--beside their
    husbands' bed in Walter Reed and not being supported by its Government,
    not being helped to provide care. I'm concerned about PTSD, and I want
    people to focus on PTSD. And so we sent up a bill, and I hope they move
    on it quickly. There's a place where we can find common ground, Sheryl.

    Cooperation With Congress/State Children's Health Insurance Program

        Q. Is it all their fault that these bills aren't moving, that you've
    got these veto threats out?
        The President. I think it is their fault that bills aren't moving,
    yes. As I said, I'm not a part of the legislative branch. All I can do
    is ask them to move bills. It's up to the leaders to move the bills. And
    you bet I'm going to put veto threats out. Of course, I want to remind
    you, I put a lot of veto threats out when the Republicans were in
    control of Congress. I said, now, if you overspend, I'm going to veto
    your bills, and they listened, and we worked together. Whether or not
    that's the case, we'll find out.
        And by the way, on the SCHIP bill, we weren't dialed in in the
    beginning. The leaders said, okay, let's see if we can get something
    moving. And I'm surprised I hadn't been asked about SCHIP. It's an issue
    that hadn't been----
        Q. How far are you willing to go?
        The President. I'm surprised I hadn't been asked about SCHIP yet.
    It's a--I made it abundantly clear why I have vetoed the bills. I find
    it interesting that when Americans begin to hear the facts, they
    understand the rationale behind the veto. First of all, there are
    500,000 children who are eligible for the current program who aren't
    covered. And so, to answer your question on how far I'm willing to go, I
    want to provide enough money to make sure those 500,000 do get covered.
    That's the--that ought to be the focus of our efforts.
        Six or seven--in six or seven States, they spend more money on
    adults than children. And finally, the eligibility has been increased up
    to $83,000. And that doesn't sound like it's a program for poor children
    to me. And I look forward to working with the Congress, if my veto is
    upheld, to focus on those who are supposed to be covered. That's what we
    need to get done.
        Mark [Mark Knoller, CBS Radio].

    Lieutenant General Ricardo S. Sanchez,
    USA (Ret.)

        Q. Sir----
        The President. Yes.
        Q. ----I wonder if you felt blindsided by the very blistering
    criticism recently from retired General Ricardo Sanchez, who was one of
    your top commanders in Iraq. He told a news conference last week that
    there's been glaring, unfortunate display of

    [[Page 1338]]

    incompetent strategic leadership within our national leaders on Iraq.
        The President. Right.
        Q. Seems like quite a lack of common ground there, sir.
        The President. You know, look, I admire General Sanchez's service to
    the country. I appreciate his service to the country. The situation on
    the ground has changed quite dramatically since he left Iraq. The
    security situation is changing dramatically. The reconciliation that's
    taking place is changing. The economy is getting better. And so I--I'm
    pleased with the progress we're making. And I admire the fact that he
    served. I appreciate his service.
        Q. Should the American people feel disturbed that a former top
    general says that?
        The President. Massimo [Massimo Calabresi, Time].

    Military Contractors in Iraq

        Q. Thank you, Mr. President. As Commander in Chief, are you in
    control of and responsible for military contractors in Iraq? And if not,
    who is?
        The President. Yes, I'm responsible, in that the State Department
    has hired those military contractors.
        Q. Are you satisfied with their performance? And if not, what are
    you doing to satisfy yourself that----
        The President. I will be anxious to see the analysis of their
    performance. There's a lot of studying going on, both inside Iraq and
    out, as to whether or not people violated rules of engagement. I will
    tell you, though, that a firm like Blackwater provides a valuable
    service. They protect people's lives. And I appreciate the sacrifice and
    the service that the Blackwater employees have made. And they too want
    to make sure that if there's any inconsistencies or behavior that
    shouldn't--that ought to be modified, that we do that. And so we're
    analyzing it fully.
        Ann [Ann Compton, ABC News].

    State Children's Health Insurance Program

        Q. Well, I wanted to ask you about SCHIP and why you even let that
    get to a situation where it had to be a veto. Isn't there a
    responsibility by both the President and congressional leadership to
    work on this common ground before it gets to a veto?
        The President. Right. As I said, we weren't dialed in. And I don't
    know why. But they just ran the bill, and I made it clear we weren't
    going to accept it. That happens sometimes. In the past, when I said,
    look, make sure we're a part of the process, and we were. In this case,
    this bill started heading our way--and I recognize Republicans in the
    Senate supported it. We made it clear we didn't agree, and they passed
    it anyway. And so now, hopefully, we'll be in the process. That's why
    the President has a veto. Sometimes the legislative branch wants to go
    on without the President, pass pieces of legislation, and the President
    then can use the veto to make sure he's a part of the process. And
    that's--as you know, I fully intend to do. I want to make sure--and
    that's why, when I tell you I'm going to sprint to the finish and finish
    this job strong, that's one way to ensure that I am relevant; that's one
    way to sure that I am in the process. And I intend to use the veto.
        Wolffe [Richard Wolffe, Newsweek].

    U.S. Policy on Detainees in the War on Terror/Congress

        Q. Thank you, sir. A simple question.
        The President. Yes. It may require a simple answer.
        Q. What's your definition of the word ``torture''?
        The President. Of what?
        Q. The word ``torture.'' What's your definition?
        The President. That's defined in U.S. law, and we don't torture.
        Q. Can you give me your version of it, sir?

    [[Page 1339]]

        The President. Yes. Whatever the law says.
        Q. You talked about sprinting to the finish, and then you also, just
    a moment ago, sounded a bit resigned to the fact that if legislators
    don't move bills there's not much you can do to it. So are you----
        The President. Well, I'm doing it right now. See, that's--not to
    interrupt you--but it's called the bully pulpit. And I hope to get
    your--I was trying to get your attention focused on the fact that major
    pieces of legislation aren't moving, and those that are, are at a
    snail's pace. And I hope I did that. I hope I was able to accomplish
    that.
        Q. One more on veterans, sir?
        The President. Go ahead--he hasn't asked his question yet. I rudely
    interrupted him.

    The Presidency/Cooperation With Congress/State Children's Health
    Insurance Program

        Q. Do you feel as if you're losing leverage and that you're becoming
    increasingly irrelevant? And what can you do about that to keep----
        The President. Quite the contrary. I've never felt more engaged and
    more capable of helping people recognize--American people recognize that
    there's a lot of unfinished business. And I'm really looking forward to
    the next 15 months. I'm looking forward to getting some things done for
    the American people. And if it doesn't get done, I'm looking forward to
    reminding people as to why it's not getting done.
        But I'm confident we can get positive things done. I mean, you
    shouldn't view this as somebody who says, well, this is impossible for
    Congress and the President to work together. Quite the contrary. I just
    named some areas where we have worked together. And we're going to have
    to work together. We're going to have to make sure our troops get the
    money they need. We're going to have to make sure America is protected.
        Having said that, I'm not going to accept a lousy bill, and the
    American people don't want there to be a lousy bill on this issue. The
    American people want to know that our professionals have the tools
    necessary to defend them. See, they understand Al Qaida and terrorism is
    still a threat to the security of this country. In other words, they're
    still out there, and they're still plotting and planning. And it's in
    our interest to have the tools necessary to protect the American people.
    It's our most solemn duty.
        So there's a lot of areas where we can work together. This just
    happens to be a period of time when not much is happening. And my job is
    to see if I can't get some of that movement in the right direction and,
    at the same time, make sure that we're part of the process. And one way
    the executive branch stays a part of the process is to issue veto
    threats and then follow through with them. And so we--that's what you're
    going to see tomorrow, as to whether or not the Congress will sustain my
    veto on a bill that I said I would veto and explained why I'm vetoing
    it.
        And again, I want to repeat it so the American people clearly
    understand: One, there are half a million children who are eligible
    under this program but aren't being covered today; two, States are
    spending--some States are spending more money on adults than children.
    That doesn't make any sense if you're trying to help poor children.
        By the way, in Medicaid, we spend about 35 billion a year on poor
    children. So if somebody is listening out there saying, well, they don't
    care about poor children, they ought to look at the size--the amount of
    money we're spending under Medicaid for poor children.
        And finally, to increase eligibility up to 83,000, in my judgment,
    is an attempt by some in Congress to expand the reach of the Federal
    Government in medicine. And I believe strongly in private medicine. Now,
    I think the Federal Government ought to help those who are poor, and
    it's one of

    [[Page 1340]]

    the reasons why I worked so hard on Medicare reform, was to make sure
    that we fulfilled our promise to the elderly. But I don't like plans
    that move people from--encourage people to move from private medicine to
    the public, and that's what's happening under this bill. And so I'm
    looking forward to working with the Congress to make sure the bill does
    what it's supposed to do.
        Listen, thank you all for your time. I enjoyed it.

    Note: The President's news conference began at 10:45 a.m. in the James
    S. Brady Press Briefing Room at the White House. In his remarks, he
    referred to former Sen. Robert J. Dole and former Secretary of Health
    and Human Services Donna E. Shalala, Cochairs, President's Commission on
    Care for America's Returning Wounded Warriors; Gen. David H. Petraeus,
    USA, commanding general, Multi-National Force--Iraq; President Vladimir
    V. Putin of Russia; President Mahmud Ahmadi-nejad of Iran; President
    Mahmoud Abbas of the Palestinian Authority; and Prime Minister Ehud
    Olmert of Israel. The Office of the Press Secretary also released a
    Spanish language transcript of this news conference.