    [Weekly Compilation of Presidential Documents Volume 29, Number 11 (Monday, March 22, 1993)]
    [Pages 418-423]
    [Online from the Government Publishing Office, www.gpo.gov]

    <R04>
    Remarks in an Interview With the Connecticut Media

     March 13, 1993

    Winter Storm

        The President. I'm sorry I'm a little late, but I'm trying to make
    sure we're doing what we need to do about the storm, which, as you know,
    is moving up the coast with winds very heavy now in the South Carolina
    area. And the center of the storm is projected to reach here as late as
    7 o`clock tonight, so it will come to you sometime in the middle of the
    night. And we're working hard, but I wanted to get an update and see
    what FEMA was doing. And we're going to be talking today about what
    other resources we ought to make available.
        I think the only thing I would say is that we have shared all the
    information we have with all the State governments involved, and I think
    people should simply exercise caution, because it's easy to go from what
    seems to be a nice big snowstorm to these very rapid winds. And the more
    you can keep telling people when the winds are coming, I think the
    better off we'll be. Once you get north of Washington, most people are
    fairly well-prepared for heavy doses of snow, even if it's the biggest
    they've had in years. But the winds are of great concern. Whatever you
    can do to make sure your people know that there are winds coming--and
    unless this storm dissipates, that can be serious; that would call for
    them to exercise great caution as the center of the storm approaches,
    which will be sometime late, late tonight for you--I'd appreciate it.
    Questions?

    Defense Conversion

        Q. Yes, sir. Can we talk about the defense cutbacks in Connecticut?
        The President. Sure.
        Q. You have a $1.7 billion plan for retraining and dual use
    technology. You've got $350 billion set aside for FY '93. I guess the
    bottom line is, when we hear in Connecticut, for example Pratt &
    Whitney, they're going to be laying off 7,000 people, sir, for people
    that are facing unemployment, the people who are unemployed, when are
    they going to see some of that money come to them this year? And is the
    infrastructure already in place to see that those industries are
    targeted that need it and the money gets there?
        The President. Well, let's back up a minute. The Congress
    appropriated this money months and months and months ago. There was a
    big debate, and the previous administration basically didn't believe
    that this was a big problem, so they never released any of the money. In
    the last few weeks, we have worked very hard to put together a plan that
    would release over $1 billion this year in defense conversion.
        In addition to that, let me just say, apropos of the Connecticut
    economy specifically, if the Congress passes the stimulus plan that I
    have recommended to try to jumpstart the economies of the States with
    high unemployment rates, Connecticut should receive about $118 million,
    just out of the stimulus package, in funds for community development
    block grants and Federal highway construction and clean water and clean
    drinking water efforts and urban transit money. So all that will be
    coming into the State, and obviously that will create a lot of jobs.
    Some of those jobs will be created in the same areas where the defense
    jobs have been lost.
        Now, to go back to your original question, we're going to move the
    job training money, the community assistance money, and the new
    technology money as quickly as we can. By and large, in most States
    there is a retraining infrastructure which will accommodate it. The
    infrastructure we need to create, frankly, is to make sure there's a
    good partnership between the Defense Department, the Commerce
    Department, and all the other Federal Agencies and communities, so that
    communities can take money and begin immediately planning to generate
    new jobs. And we need a better partnership between the Government and
    the private contractors to make sure that they have as much lead time as
    possible to plan to put new technologies into effect or to take their
    defense technologies and convert them into commercial products.

    [[Page 419]]

        I'm sure all of you saw the press when I went to Baltimore to the
    Westinghouse plant. To assist in that regard, we're going to do two
    things. First, we've got all the Federal Agencies involved to put
    together a book which can be made available to every defense contractor
    in America, which shows the resources and the efforts that can be made
    by the Advanced Research Products Agency, the Commerce Department, the
    Energy Department, which controls the Federal labs where a lot of this
    research is done, the Defense Department, NASA, and others.
        Secondly, we're going to go out across the country now and hold
    meetings that are literal workshops for defense contractors to try to
    get them involved in this process before the contracts run out. The
    thing that has bothered me about this all along is that these contracts
    have been canceled, and then someone comes along and says, well, why
    don't you think of something else to do? So what we're going to try to
    do is to develop an ongoing relationship with defense contractors which
    will permit them to plan for conversion, even as they're still producing
    whatever products they're contracted to produce by the Defense
    Department. And this whole thing has to be coordinated in a much more
    disciplined fashion than it has been in the past. And that's why I've
    set up this defense conversion group, to do.
        Let me just make one other point, since the Department of Defense
    yesterday announced another round of base closings and realignments,
    which would be modest compared to the contracting losses you've had.
    There would be a reduction of 2200 jobs in Connecticut around the
    submarine operations. Here is the dilemma for us--and I want to just put
    that out here so you will be able to evaluate what happens in the
    future. We've had two rounds of base closings so far. They've been
    fairly modest. And this announcement from the Pentagon was pretty big.
    And there will be another one in 1995. Keep in mind, all these bases
    that were on that list, even if the commission approves them for closing
    or realignment, they won't be closed for 3 to 5 years. That gives us
    real time to plan, if we do it. If we really have an aggressive plan, it
    gives us time to plan the futures of the men and women in uniform who
    may be mustered out. It gives us time to plan for the futures of the
    communities and the civilian employees.
        Let me ask you to consider what happens when you don't do this. On
    the plan we're on now, if we don't close any more bases, we will have by
    1997 reduced defense by 40 percent, personnel in uniform by 35 percent,
    overseas deployments by 56 percent, and base structure by 9 percent.
    Now, what does that mean to Connecticut? It means that if you--because
    of the incredible difficulty of closing domestic bases, it means if you
    don't close any of them and you have this defense budget going down,
    that means more reductions in contracts. It means it hurts the plants
    and where the high-tech production is done even more.
        One of the reasons that we have to close some more bases is, with a
    reduced Armed Forces at the end of the cold war, we have got to maintain
    a very, very high level of technological superiority and military
    readiness, which means we still are going to have a very significant
    amount of military contracts out there in high technology areas. But you
    could argue that over the long run, the States that have a lot of the
    plants that do this work, like Connecticut, California, and others,
    would be better off if we can exercise the discipline to close the bases
    in a way that is humane and fair and economically advantageous. So
    that's what we're trying to do.

    Sea Wolf Operation

        Q. Mr. President, John Baxter from Associated Press. As you know,
    I'm sure, part of your reputation in Connecticut regarding defense stems
    from your comments during the campaign in support of the Sea Wolf, and
    I'm sure you know what an important program that is in terms of jobs up
    there. I wonder if I could ask you if you could tell us at this point
    what your plans are for the Sea Wolf, and more generally, what your
    comments to the people of Connecticut would be now that we're beyond the
    campaign and into the administration and defense spending is going down
    sharply?
        The President. Well, you remember what my position was on the Sea
    Wolf, which is that I thought at least one more ship should be completed
    than the administration said,

    [[Page 420]]

    and then we should, in effect, transform the operation to produce a
    smaller follow-on ship. That is what I believed, and interestingly
    enough, that's what I was advised by the people with whom I was
    consulting back in 1991 was the best policy. Contrary to a lot of the
    things which were written in and out of Connecticut, it didn't have much
    to do with the Connecticut primary. I didn't even know if I'd be
    politically alive in the Connecticut primary in November and December of
    1991 when we were trying to evaluate these decisions. I see no reason in
    my own mind to change that position.
        Now, what we are doing now with the Defense Department--let me tell
    you what we have to face. What we are doing now is to try to see what
    our options are for proceeding both with contracts and with personnel,
    with the new budget targets we're going to be required to meet. I'm
    hopeful that both the Senate and the House will adopt my defense budget
    cuts without cutting them anymore. And if so, then we may be able to
    pursue the course that I outlined in the campaign.
        But let me tell you, there is one other problem. I just want to make
    you aware of this, and we won't know exactly what the end of it is
    until, oh, about 2 weeks from now. The budget that the Department of
    Defense has that was approved by the last Congress includes several
    billions of dollars in management savings in the Department of Defense
    which the Secretary of Defense, Mr. Cheney, offered and which the
    Congress accepted, which are now being questioned. That is, it's now
    being questioned about whether these management savings are real. And a
    special committee has been appointed to review the budget and to see
    whether or not, in effect, the Congress has approved a cut which can't
    be realized simply by reorganizing the Defense Department in management
    savings. We were advised to put another $10 billion in reduction on our
    defense budget at the end of this cycle, in fiscal year '97, as a hedge
    against the fact that as much as $30 billion of those management savings
    by FY '97 may not be real.
        Now, let me tell you what that means practically since we're all
    committed to certain deficit reduction targets. What that means is that
    if these management savings which the Congress has already budgeted for
    from the previous administration don't turn out to be real, we'll have a
    very serious question to address. I am resisting further cuts in
    defense, apart from the $10 billion extra one I agreed to try to absorb
    at the end of this process. But I just want you to be aware of the fact
    that that is out there and that this is sort of an ongoing debate in-
    house here. We're trying to figure out--the Secretary of Defense is
    working with the services to see what they believe we should do and to
    work out the best possible result.
        Q. But the Sea Wolf question relating to this upcoming budget
    remains an open question until notice----
        The President. I think it is an open question, but I haven't changed
    my position on it. But I cannot tell you it's a lock-cinch deal because
    of what's happened, because of this--this is sort of a wild card for
    us--and because I'm obviously involved with the Congress now in trying
    to work through this.
        Q. Brian Thomas at WTIC in Hartford. General Dynamics as a
    corporation, producer of the Sea Wolf, as you know, openly is not
    embracing the dual use concept. They are staying with defense as a
    livelihood. Is this kind of approach in your view something that's
    viable, given this situation we have now, or will they sign on to this
    eventually?
        The President. Well, it depends. Let me say what I mean by that. It
    depends on what General Dynamics or any other kind of company in this
    position projects will be the future demand for defense products that
    they can produce. Let me give you an example. For example, Sikorsky in
    Connecticut and another one of your helicopter companies I think is up
    in employment. And a lot of our allies may well be buying more short-
    haul aircraft and may be buying more helicopters in the future for more
    limited and different kinds of military operations. So there's no
    question that some military contractors will be able to continue to
    fully--or almost all military contractors--and do well. And there will
    be some things where the demand for products will actually increase. We,
    the United States, will be buying some new military products and
    technology that we have not purchased in the past. So some people will
    be there.

    [[Page 421]]

        On the other hand, with the overall budget going down and,
    therefore, with both the size of the Armed Forces and at least the
    guaranteed replacement of old products being less, a number of these
    defense contractors are going to have to look for alternative products.
    And I don't know enough about what General Dynamics' options are to know
    whether that's the right or the wrong decision. All I can tell you is
    that we're prepared to assist with joint research and development
    efforts and everything else in our power. We're prepared to assist those
    companies that are serious about converting. The Westinghouse plant--let
    me just tell you, the one in Maryland I visited--5 years ago was 16
    percent nondefense. Today it's 27 percent nondefense. By 1995 it'll be
    50-plus percent nondefense. And what I think you're going to see--I'll
    just make a prediction where I think you're going to see in many areas--
    is a kind of a blending where the defense-nondefense line is regularly
    crossed and where the technology is being used for both civilian and
    military purposes. For example, at Westinghouse we saw some things
    making full circle. We saw military technology producing a civilian
    product; then we saw civilian technology being marketed back to the
    military for the first time. So I think that this will become a blurry
    line.
        Now, submarines have few uses other than military. I mean, it's hard
    to imagine--you know, maybe some weather uses there, maybe nonmilitary
    uses for submarines in the environmental area, particularly around the
    poles and other things. But I just think--I wish I could give you a yes
    or no answer, but I'd have to know more about what their options are and
    what they project the products to be.
        Q. When you say completion of another submarine, are you talking
    about the third or the second, since the second hasn't really started
    yet? And if the submarine fleet is to be reduced to 40 to 45 submarines,
    when do you envision funding for the next generation and what would it
    look like?
        The President. I can't answer that yet because that's one of the
    things we have under review. But I will be glad to try to get you an
    answer from the Defense Department as quickly as I can. The last time I
    had a conversation about this, there was a general consensus that the
    design of the Sea Wolf was not necessary in terms of its size, bulk,
    given a declining Soviet threat and breathtaking drops in production
    there for their own capacity, but that we still needed and, in fact,
    were quite dependent on submarine technology to maintain our overall
    military superiority, but that there ought to be one designed that was
    smaller and quicker and could do more different things. And so we're
    working on that. But I don't have--I can't answer the specifics you've
    asked.

    Russia

        Q. ----the developments in the former Soviet Union right now with
    Boris Yeltsin, and how does that fit into your accounting strategy for
    defense?
        The President. Well, obviously, we're all concerned about it. But,
    you know, I don't think you could have ever predicted an easy ride for
    democracy and for a market economy in a country which had never had a
    market economy and which had the courage to try to seek democracy at the
    same time. So I view all these things with--I'm interested in it, I'm
    concerned about it, but as far as I'm concerned, he is still the only
    person who's been elected President of the country, and I believe he
    genuinely believes in economic reforms and political democracy. And I
    think we should support that. And I'm going to do what I can to be
    supportive.
        I think that if the major countries, the G-7 countries that are in a
    position to support those movements would show a more coordinated and
    aggressive approach to the problems, it might be possible to build a
    consensus in Russia for how they would work with all of us. Every
    elected official has his or her political opponents. That's part of the
    way the system works. And an awful lot of the people that are in the
    Russian legislature were active members of the Communist Party. So you
    would expect it to be somewhat less reformist than he is. Plus a lot of
    them are responding to the cries of their own people for help. They're
    in deep trouble economically.
        My own view is there are a lot of things that can be done, that that
    country can still have a bright future as part of a peaceful coa-

    [[Page 422]]

    lition of nations in the world. And I just hope that we'll have the
    opportunity to do it. I was encouraged in my meeting with President
    Mitterrand that he seemed very willing to adopt an aggressive posture
    toward trying to do more. And I'll do the best I can to be ready on
    April 4th, which is just a few days from now, with my meeting with
    President Yeltsin.
        Q. Would you support him still if he suspends the Parliament? And
    also, if he calls in military force, would you support him? Also, what
    would you say to those who are saying you're relying too much on his
    survival?
        The President. Well, first of all, I don't think that it would serve
    any useful purposes for me to try to interpret the Russian constitution
    right now and what it does or doesn't mean or what we would or wouldn't
    respond to. The United States supports democracy and economic reform in
    Russia.
        Now, in terms of whether we're putting too much reliance on Yeltsin
    personally, my answer to that is, we will work with what we have to work
    with, whatever happens. But I think we should support him because he has
    been elected, after all. I mean, there was an election; the people voted
    for him. And he represents a passionate commitment to democracy and
    economic reform. And he's gotten, frankly, in my judgment, from the
    major countries of the world who have a stake, not just a political but
    an economic stake in Russia, an inadequate response to date.
        So I'm trying to do what I can to muster the support to do more,
    because I think it's very much in America's interests, and he's the
    person that I think I should work with. He is the elected President of
    Russia. That is a fact. And I hope he will continue to be the elected
    President of Russia. But the United States has an interest in a Russia
    that is not hostile to us, that is not a military enemy, and that,
    frankly, has a whole lot more economic growth than the Russia that we
    know does now. And I'm just trying to respond to that. I think that
    working with him is the best way to do it at this time, and I believe--
    I'll say again--no one knows what's going to happen. But the man is an
    honest democrat--small ``d''--and he's passionately committed to reform.
    And I want to keep working with him.

    Defense Conversion

        Q. Mr. President, diversification is a goal, but what can you do
    about the fact that so many defense manufacturers have been reluctant to
    diversify?
        The President. All I can do is to try to make sure that they have
    the maximum number of options. Let me give you an example of what
    happened yesterday, or the day before yesterday at the Westinghouse
    plant. I talked to one of the people, a woman there who was in charge of
    marketing these new products, and I said, ``Tell me what the problems
    are.'' She said, ``Well, it's not so much that we can't ever think of
    what we could do that might have a nondefense application, but most of
    us have never contracted in the private sector before. We have never
    marketed in the private sector. And we're not sure that what we think
    will work, will work.'' Basically, I think what I have to do for these
    defense contractors is to try to create, through the enormous resources
    that the Federal Government has invested in them over time and has
    invested in technology research, an environment in which they can at
    least visualize and imagine all the potential that might be there and
    then the opportunity they have to make the connections with the private
    sector on the civilian side. So that's what we're going to try to do. I
    just would say every defense contractor needs to think about it. The
    answer may be no in some cases, but everybody really needs to think
    about it and that the Government is going to be there in a consistent
    way to do it.
        If you look at every projection of high technology, high-wage
    employment going well into the 21st century, the technologies that are
    there are things that have often been dealt with in defense;
    biotechnology, civilian aviation, computer software. Some of the most
    sophisticated imaging in the world is done by the Defense Department.
    Now, that's the only thing I would say. There may be some products which
    are not susceptible to civilian spinoffs, but most of them are.

    Legalized Gambling

        Q. I don't know if you're aware of it, but one of the things that's
    been talked about

    [[Page 423]]

    in Connecticut, to fill the gap with defense leaving, is casino
    gambling. And I wonder if you'd just share your thoughts with us on how
    you feel about legalized gambling coming to a State like Connecticut, if
    we should do it?
        The President. I'm not the best person in the world to ask about
    that because I grew up in a town that had the largest illegal gambling
    operation in America--[laughter]--when I was a kid, until it was shut
    down in the mid-sixties.
        First of all, I strongly believe it should remain a question of
    State law. That is, I don't think I should decide for you one way or the
    other--or the Congress. I think that it ought to be a local question.
    The second thing I would urge is that before you do it, you analyze very
    carefully what the benefits and the costs are, because it is not a free
    ride. That's the only thing I'll say. It is not an unmixed blessing. You
    may decide that it is, on balance, worth doing, but it is not an unmixed
    blessing. If you look at Nevada, for example, the fastest growing State
    in the country, one of the reasons they're growing fast is that they're
    diversifying away from gambling toward more broad-based convention work
    and other kinds of economic activity. So that would be my advice. Don't
    just take it at face value. And really think about it before you do it.
        Thanks.

    Military Base Closings

        Q. ----reviewing and tinkering with base closing list?
        The President. No. The Secretary of Defense had the list, and he
    made the decisions. The only thing I asked him to do was to make sure
    that he had really evaluated the economic impacts of it all. And he said
    that he would do that. The only--he made a point to me that under the
    law, the Defense Department is required to do that, and it really
    couldn't be done by the services because they made their recommendations
    based on their needs within their services. So the Air Force and the
    Army and the Navy couldn't have foreseen the cumulative impact on any
    given State of what they recommended. And that's why the Secretary of
    Defense went through the process he did. But he did it. I think it's
    very important that we leave the process in that way. And so that's what
    we did.

    Note: The President spoke at 11:42 a.m. in the Cabinet Room at the White
    House.