[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.