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Special Event

President Bush Applauds House Budget Bill

Aired March 29, 2001 - 10:29 a.m. ET

THIS IS A RUSH TRANSCRIPT. THIS COPY MAY NOT BE IN ITS FINAL FORM AND MAY BE UPDATED.

DARYN KAGAN, CNN ANCHOR: Want to take you live to the White House now, where we expect any minute President Bush to come out, make some comments and answer some questions from the White House press briefing room.

And that's where we happen to find our White House correspondent Major Garrett standing by for this.

Major, where did this come from? I think we just got word of this about 35 minutes ago.

MAJOR GARRETT, CNN SENIOR WHITE HOUSE CORRESPONDENT: Got word of it about 35 minutes ago. Where did it come from? Well, a sense in the White House that some of its legislative achievements are not receiving adequate attention. I just spoke to a senior White House adviser who said, in an exasperated voice, you know, the budget vote yesterday in the House just got buried; no coverage at all. That was a significant achievement.

Part of what the president is going to say in opening comments on domestic policy will be to praise that House vote passage of his budget resolution, and also talk about the vote coming up in the Senate next week on the budget; a very crucial legislative marker for this White House. But the president will also talk about international policy. He was referring us specifically to the violence in the Middle East amplifying, in the words of one adviser, the statement put out last night by the White House condemning the violence and urging both sides to use maximum restraint to calm the situation, but also specifically calling on the Palestinians to do more to renounce violence as a tool of achieving their political ends -- Daryn.

KAGAN: Major, as the president does call this news conference and does speak and is carried on our network here at CNN it brings up the question of who is setting the agenda in Washington; is it the White House or is it the Senate, as I think we've had a lot more coverage of campaign finance in the recent weeks?

GARRETT: Well, exactly. In my conversation with that senior adviser, I said, well, one of the reasons that budget vote didn't get much coverage is there was so much emphasis on the Senate, where campaign finance reform is entering its final days of consideration, and where John McCain, the president's rival during the Republican primaries, has dominated press coverage. That is clearly understood here at the White House.

They want to get the president, not back on the offensive -- they don't feel he's been in any sort of defensive crouch -- but this is a day, an important day in the Senate for final consideration of campaign finance reform. I don't believe this White House wanted to cede that territory anymore' want to get the president's voice in it -- brought -- bring attention, as I said, again, to that budget vote; a key vote in the House of Representatives yesterday because it made room for the entire $1.6 trillion tax cut the president proposed over the next 10 years.

There is tremendous lobbying going on among White House -- senior White House staff with Senate Republicans right now. The hard vote count -- the committed number of Senate Republicans to that budget resolution is 47. Of course, the White House needs at least 50 votes. The additional 51 vote could come from Vice President Cheney, who sits as the presiding officer of the Senate. The White House would clearly like to get more support, but right now they're three votes away. And part of what the president's message is today is the House did the right thing, Senate Republicans, next week I'm going to be asking you to do the right thing as well -- Daryn.

KAGAN: Busy day at the White House today, Major. The President also visiting with German Chancellor Gerhard Schroeder, so international relations will be on the docket, missile defense and also the environment. The president making an announcement yesterday that was not too pleasing to the European allies.

GARRETT: It drew consternation from many European capitols. Gerhard Schroeder, the chancellor of Germany, will be the second European leader to visit the president here in Washington. And clearly the issue of global warming and how to confront it will come up; it has sort of risen very recently to the top of Mr. Schroeder's agenda, in part because of the White House announcement yesterday, which really should not be a surprise, they said that in the campaign.

KAGAN: Looks like we're getting close, but I don't see the president yet, so why don't we keep chatting, Major, until we do see the president.

GARRETT: During the campaign, Daryn, the president made very clear that he was not a fan of the Kyoto Treaty, a treaty that would try to reduce emissions in industrial nations of greenhouse gases. Nevertheless, the White House announcement came as a surprise...

KAGAN: Now I see the president -- I see the president; let's listen, Major.

GEORGE W. BUSH, PRESIDENT OF THE UNITED STATES: Good morning.

First, I want to say how pleased I am that the House yesterday passed on a realistic, common-sense budget to the Senate. I appreciated the vote. They did the right thing. It is a budget that meets our nation's priorities. It is also a budget that leaves ample room for meaningful, real, long-lasting tax relief. I look forward to working with the Senate to get a budget passed. I am also deeply concerned about the escalating violence in the Middle East. It is claiming the lives of innocent civilians on both sides. The tragic cycle of incitement, provocation and violence has gone on far too long. Both sides must take important steps to calm the situation now.

The Palestinian Authority should speak out publicly and forcibly in a language that (sic) the Palestinian people to condemn violence and terrorism. It should arrest those who perpetrated the terrorist acts. It should resume security cooperation with Israel.

The government of Israel, for its part, should exercise restraint in its military response. It should take steps to restore normalcy to the lives of the Palestinian people by easing closures and removing checkpoints. Last week Prime Minister Sharon assured me that his government wants to move in this direction and I urge Israel to do so.

I will be meeting with Egypt's President Mubarak next Monday and Jordan's King Abdullah the week after to seek their help in diffusing the tensions.

Egypt and Jordan are two of our most important partners in the region, and their role is crucial. I've asked Secretary Powell to call Chairman Arafat today and contact other leaders to urge them to stand against violence. Our diplomats in the region are fully engaged in this effort.

Our goal is to encourage a series of reciprocal and parallel steps by both sides that will halt the escalation of violence, provide safety and security for civilians on both sides and restore normalcy to the lives of everyone in the region. A lasting peace in the region will come only when the parties agree directly on its terms.

This week, I vetoed an unbalanced UN resolution because it tried to force the adoption of a mechanism on which both parties did not agree. My approach will be to facilitate the parties work in finding their own solution to peace. We seek to build a stable foundation for restoring confidence, rebuilding security cooperation and resuming a political dialogue between the parties.

I'd be glad to answer some questions.

QUESTION: The Senate, as you know, is finishing up legislation to ban all soft money. What do you think of the bill, particularly the ban on individual contributions that you forcefully opposed in your campaign? Specifically, sir, would you sign it?

BUSH: This is a bill in progress. It's a bill that continues to change.

BUSH: And I'll take a look at it when it makes my desk. And if it improves the system, I'll sign it. I look forward to signing a good piece of legislation.

QUESTION: Could you sign a bill that bans individual soft money contributions? BUSH: I'll look at the whole bill and I'll make my determination as to whether or not the bill improves the situation. And I appreciate the hard work that's being done on the legislation. And I'm going to wait until I see the final version. Yes, Helen. I'm sorry.

QUESTION: Mr. President, is your administration reviewing U.S. aid to Russia to stop this threat of nuclear, biological and chemical weapons? Are you considering reducing that aid? And, if so, why?

BUSH: Well, we're reviewing all programs; those related to de- escalating potential nuclear problems. We want to make sure that any money that is being spent is being spent in an effective way. I have the obligation to the taxpayers to make sure that the money, for example, going to the Russian program as part of Nunn-Lugar, for example, is effective. And so we're putting a full review on the programs.

And we fully intend to continue to cooperate with the Russians. It's in our nation's best interest to work with Russia to dismantle its nuclear arsenal.

I was pleased to see that Senator Nunn, one of the authors of the Nunn-Lugar bill, agreed with our approach to take a look to make sure the programs are efficient. And we will continue to do so. Helen.

QUESTION: Mr. President, in the last few weeks you have rolled back health and safety and environmental measures proposed by the last administration and other previous administrations.

This has been widely interpreted as a payback time to your corporate donors. Are they more important than the American people's health and safety, and what else do you plan to repeal?

BUSH: Well, Helen, I told people pretty plainly that I was going to review all the last-minute decisions that my predecessor had made, and that is exactly what we're doing.

I presume you're referring to the decision on arsenic and water. First of all, there had been no change in the accepted arsenic level in water since the '40s. And at the very last minute, my predecessor made a decision and we pulled back his decision so that we can make a decision based upon sound science and what's realistic. There will be a reduction in the acceptable amount of arsenic per billion, after the review in the EPA.

QUESTION: How about stopping the black lung benefits for families and -- this is sort of to increase some of the benefits of these miners?

BUSH: We will work with members of the delegation and make sure people are properly treated. Ours is going to be a administration that makes decisions on science, with realistic, common-sense decisions.

For example, circumstances have changed since the campaign. We're now in an energy crisis. And that's why I decided to not have mandatory caps on CO2. Because in order to meet those caps, our nation would have had to have had a lot of natural gas immediately flow into the system, which is impossible. We don't have the infrastructure able to move natural gas.

We need to have an active exploration program. One of the big debates that's taking place in the Congress, or will take place in the Congress, is whether or not we should be exploring for natural gas in Alaska, for example, and ANWR. I strongly think we should in order to make sure that we've got enough gas to be able to reduce greenhouse emissions in the country. You see, gas is clean. And yet, there is not enough of it. And we've got pipeline capacity problems in the country.

We have an energy shortage. I look forward to explaining this today to the leader of Germany, as to why I made the decision I made. We'll be working with Germany. We'll be working with our allies to reduce greenhouse gases. But I will not accept a plan that will harm our economy and hurt American workers.

John.

QUESTION: Mr. President, new figures out today show that the economy grew at an annual rate of 1 percent in the last three months of the year 2000.

BUSH: Right.

QUESTION: My question to you, sir, is what are you prepared to do to immediately stimulate the economy? Because it would appear that your long-term tax package does not do it, yet you dismiss out-of-hand attempts from the Hill to give back a rebate of some $60 billion this year, unless it's tied to longer-term tax relief. Why can you not sign a short-term package and then pursue your long-term package separate to that?

BUSH: Well, John, first of all, I support the efforts on the Hill to provide immediate tax relief. I've been calling for immediate tax relief. I think it makes sense to do so. But we've got to have long-term relief as well. Part of building confidence in our economy is not only to give the consumers a boost, but to have a plan that reduces rates for the long-term, so that people who make investments -- small business owners, the entrepreneurs -- will have certainty that the cash flows of the future will be enhanced so they can expand their job base and make new capital purchases.

I appreciate very much what the leadership and the Senate -- Tom Daschle, for example, talked about immediate tax relief or immediate rebates, plus reducing rates permanently. He (ph) just needs to reduce more rates than the ones he's suggested.

There is a debate going on here in Washington. And it's really, do you want to increase the size of the federal government, or do you want to let people keep their own money?

And there's a philosophical divide. And I'm going to continue to stand on the side of the people and make it as clear as I can that we've met our priorities in the budget I submitted, and it's not only good for the economy, though, to give people their money back, it's good for working families, so they can have more money to manage their accounts.

There's a lot of focus about national debt in Washington, but it's important for Congress not to forget a lot of folks have got consumer debt as well. And when you couple high energy prices with consumer debt, a lot of folks are in a squeeze. And I look forward to continuing to make the case.

QUESTION: But with respect, sir, as this debate continues, consumers are not seeing any more money back in their pockets.

BUSH: That's exactly right. And you got a good point -- consumers haven't seen any money back in their pockets. That's why it's important for the Senate to act quickly on the budget. I hope there's no delay next week.

And when it comes to the budget considerations, I look forward to working with both House members and Senate members once the budgets have been passed to get tax relief enacted quickly and to get money as quickly as possible into the people's pockets.

QUESTION: Mr. President, you're no longer negotiating with yourself on tax cuts. There are a lot of other approaches that are out there. Why not say today exactly what you're willing to do to appease both moderate Republicans and Democrats who fear that those projected budget surpluses won't materialize and they want some way to cut off a tax cut, if that's the case, if we can't afford it? What will (ph) you do?

BUSH: Listen, I'm anxious to talk to members of the Senate about the so-called look-back provisions, but I'm going to remind people that one way budget surpluses will not materialize is if Congress overspends. And so, any look-back procedure has go to make sure that there are restraints to government spending.

The surest way to eat up the surplus is to have the kind of spending that took place during the last fiscal year, when discretionary spending increased by 8 percent. And by the way, I'm still negotiating with myself.

(CROSSTALK)

BUSH: People keep -- I get a suggestion from here and a suggestion from there -- so-and-so suggests something. And good Americans, such as yourself, are trying to get me to negotiate with myself.

QUESTION: Let me just bring up another suggestion.

(LAUGHTER)

BUSH: Another chance to negotiate with myself? QUESTION: Will you sign or veto tax cuts that exceed $1.6 trillion, even if it would result from -- that increase would result from -- an immediate stimulus to the economy this year?

BUSH: David, I hope that Congress does not diminish the size of the tax relief package that I've sent up there, nor increase the size of the tax relief package I've set up there. The 1.6 is the size that I think is right. And we've had a lot of discussion here in Washington about whether it's too big or too small. Nothing has changed my opinion as to whether or not -- about the size of the package I sent. It's the right size. Don't worry about the beeper violation.

(LAUGHTER)

BUSH: It's a new approach.

(LAUGHTER)

BUSH: Gordon taught me a lesson.

QUESTION: On the Middle East, sir, for a couple of months, both you and officials in your administration have indicated you wanted to step back from constant involvement of the U.S. and the president in the conflict and in the peace process. Was that a mistake, given the escalation in both violence and the rhetoric over there, and is what you're doing today, essentially, an admission that the involvement of the United States and the president of the United States publicly and personally is necessary for the parties to...

BUSH: Terry, I have said all along that this nation will not try to force a peace settlement in the Middle East, that we will facilitate a peace settlement. It requires two willing parties to come to the table to enact a peace treaty that will last. And this administration won't try to force peace on the parties.

That is what the UN tried to do the other day. They tried to force a situation in the Middle East to which both parties did not agree, and that is why I vetoed their suggestion.

We have been fully engaged in the Middle East. We are on the phone all the time to the leaders. I am welcoming leaders to come. In order for there to be a peace, this country must develop what I call a broad foundation for peace; that means we have to have good strong relations with the Egyptians and the Jordanians and the Saudis.

As you may remember, the secretary of state went to Syria to sit down with Bashar. And we have a lot of work to do in order to build that foundation for peace, but we are going to make a full-time effort to do so. But our fellow citizens have got to realize that in order for there to be a peace, there has to be two willing parties. And we will continue to try to convince the parties to become willing to sit down and negotiate a lasting peace, but this country cannot impose a timetable nor a settlement on the parties if they are unwilling to accept it.

QUESTION: Merely to contain the violence, sir, do you personally need to get more involved? Is that what you are doing today?

BUSH: I am involved on the telephone. I met with Prime Minister Sharon. I am talking to our allies and friends in the Middle East. I have instructed the secretary of state to call Mr. Arafat. And implicit in your question is the first step, and, that is, the violence must cease in order for there to be any meaningful dialogue in the Middle East. And so we are in the process of trying to bring calm to the region, and it is going to require more than just one voice.

Obviously, our voice is an important voice for bringing calm to the Middle East, so are other nations. And I look forward to visiting with President Mubarak and King Abdullah, to lend -- to rally them to try to convince, particularly in their case, Mr. Arafat, to speak out against violence in a language that the Palestinians can understand.

QUESTION: Mr. President?

BUSH: Major?

QUESTION: You have mentioned, today, that there is an energy crisis, and, yet, the budget resolutions that have passed the House and are due to be considered in the Senate next week, do not include any revenue from the drilling in the Arctic National Wildlife Refuge.

I've talked to the people who've made that decision, and they said it is a political fight; they believe unwinnable, that you could not, nor could they, create the majorities in either the House or the Senate to bring about drilling in ANWR, your number one solution, or one of the top solutions, to dealing with the energy crisis.

Does this not represent a rejection from your own party in dealing with the energy situation?

BUSH: Well, Major, first of all, there are other areas in the United States on which we can find natural gas. I think it's important for us to open up ANWR. Whether or not the Congress sees it that way is another matter. But that's not going to deter me from having, for example, the interior secretary look at all lands that are not to be fully protected for exploration.

We've got to plan to make sure that gas comes -- flows freely out of Canada into the United States. I talked to the prime minister about that.

What I find interesting is that, I think we had meaningful discussions about exploration in the Northwest Territories, right across the line, and literally miles away is ANWR. But nevertheless, there's a big, vast region of natural gas. And it's important for us to explore and encourage exploration, and work with the Canadians to get pipelines coming out of the Northwest Territories to the United States.

I've talked to the president of Mexico about a policy. There's going to be a lot of areas where we can find natural gas in America other than ANWR. It would be helpful if we opened up ANWR. I think it's a mistake not to. And I would urge you all to travel up there and take a look at it and you can make the determination as to how beautiful that country is.

Yes, Major.

QUESTION: If the American people are looking to you to deal with the energy crisis and you cannot look to your own party to deal with what you and your own advisers have said is a crucial area in which to explore, how can the American public have confidence in your ability to deal with Congress to address a situation you have called today a crisis?

BUSH: There's a lot of other areas we can explore, Major, and one of them is to work with the Canadians. There's gas in our hemisphere. And the fundamental question is, where is going to come from? I'd like it to be American gas. But if the Congress decides not to have for exploration in ANWR, we'll work with the Canadians.

I'm interested in getting more energy supply so that businesses can grow, people can heat their homes. We've got a shortage of energy in America. And it doesn't matter to me where the gas comes from in the long run, just so long as we get gas moving into the country; so long as we increase supply of natural gas. And we also need to have clean coal technologies as well. And we need a full front on an energy crisis that is real in California and looms for other parts of our country if we don't move quickly.

Mr. President, as I'm sure you've been aware, there are stories consistently about tensions, persistent tensions between you and Senator John McCain dating back to your rivalry in the primaries. I wonder if you could address that, not just from the campaign finance reform bill, but also on the patients' bill of rights, which McCain supporters believe you don't want to sign a patients' bill of rights with McCain's name on it.

BUSH: Well, look, this is Washington, D.C. gossip, is how I view it. I mean, I respect John McCain. I like him a lot. That doesn't mean we're going to agree 100 percent of the time. I mean, obviously, we've got some differences. That's what the primary was all about, airing our differences. But I respect John.

I mean, it's a game in Washington to try to create tension between John McCain and me. And I'm not going to let it happen.

Now, I can't control the stories that seem to be popping up all the time on account of the faceless aides that are out there trying to stir the pot.

I can just give you my perspective. I like him. He's a good man. We have some differences.

You know, I think the idea, for example, of having a $5 million cap on punitive damages is just not the right public policy. But that shouldn't surprise you. After all, I signed a bill in the state of Texas with a $750,000 cap on punitive damages. But that's nothing personal, just a difference of opinion. And the idea of the president laying out, you know, a framework for debate and some guidelines is perfectly acceptable practice in Washington, D.C.

Yes?

QUESTION: To follow on that. When you sent a signal, and your aides did, to Congress that they could not count on you to veto a campaign finance reform bill, what message were you sending? A lot of people interpreted as that you're saying to Congress, "If you don't like, kill it, because I won't."

BUSH: No, as I said, I look forward to signing a bill that makes the process better. Sometimes the legislators will say, "Oh, don't worry, we've got the president."

I'm not sure exactly what that means, except if a bill improves a system and makes it to my desk, I will be inclined to sign it. Of course, I reserve all options. The bills are forever changing, as those who follow the process know. But I will make my decision once the bill makes it to my desk.

QUESTION: Mr. President, why is it that you have not decided to invite Yasser Arafat here? Have you concluded that he's part of the problem, not part of the solution?

BUSH: Well, we are going to work with all parties. As I mentioned, the secretary of state is calling Chairman Arafat today to urge him to stop the violence and call upon those over whom he's got influence to stop the violence. And I have got quite a crowded calendar of leaders who are coming to see me, and I am looking forward to visiting with President Muburak and King Abdullah.

Mike.

QUESTION: Mr. President...

QUESTION: I'm sorry, could I...

BUSH: No.

(LAUGHTER)

BUSH: Just teasing. Go ahead. Just testing.

QUESTION: Mr. President, the Palestinians think you are sending them a signal. Are you?

BUSH: The signal I am sending to the Palestinians is stop the violence, and I cannot make it any more clearer. And I hope that Chairman Arafat hears it loud and clear. He is going to hear it again on the telephone today.

This is not the first time the message has been delivered. It is so important in order for there to be any kind of discussion about peace that we stop the violence in the Middle East. Mike.

QUESTION: Mr. President, allies of the United States have complained that you have not consulted them sufficiently on your stance for negotiation with North Korea, the Kyoto treaty, we have deteriorating relations elsewhere. When you read the international press, it looks like everyone is mad at us. Mr. President, how do you think that came to be? And what, if anything, do you plan to do about it?

BUSH: Well, I get a completely different picture, of course, when I sit down with the world leaders. I am looking forward to sitting down with Mr. Schroeder here in about 30 minutes.

I have had very honest and straightforward visits with many of the world's leaders.

BUSH: And there's -- sure, there were some concerns initially because they didn't know me. And they heard all kinds of rumors about what our administration would be about. And I now have the chance to sit down and talk to them face-to-face. And I'm a pretty straightforward fellow, Mike. And if I -- I don't mind making my case and it's important.

It's important for world leaders to know exactly where the United States is coming from. On missile defense, for example, I've assured our allies that we will consult with them, but we're moving forward to develop systems that reflect the threats of today. I mean, who knows where the next terrorist attack is going to come from, but we better be ready for it. And I believe I've got the opportunity to convince our friends and allies that our vision makes sense. It brings a lot of common sense to an old, stale debate, the old arms control debate.

In terms of the CO2 issue, I will explain as clearly as I can today and every other chance I get, that we will not do anything that harms our economy, because first things first are the people who live in America; that's my priority. And I'm worried about the economy. I'm worried about the lack of an energy policy. I'm worried about rolling blackouts in California. It's in our national interests that we develop a strong energy policy with realistic, common-sense environmental policy, and I'm going to explain that to our friends.

And it's in their interest, by the way, that our economy remains strong. After all, we're a free-trading administration, we trade with each other. And people are beginning to learn what my administration is like. And they're going to find we're steadfast friends.

But a friend is somebody who's willing to tell the truth. And if there's a disagreement, to be able to state it clearly, to make it clear where we disagree. But for those who worry about our willingness to consult, they shouldn't worry, we are. We're going to be open-minded and we'll have open dialog.

Yes, sir?

(CROSSTALK) BUSH: You're next.

QUESTION: Thank you, sir. Mr. President...

BUSH: No, next to next.

QUESTION: If I could just clarify a little.

BUSH: Let me rephrase it: You're last.

(LAUGHTER)

QUESTION: No problem. We're used to it.

QUESTION: Just to clarify on tax cuts.

BUSH: Yes?

QUESTION: I wanted to clarify the linkage that you feel is necessary. You have said that you want to have a tax cut rate- reduction and you also support the efforts to try to do a quick, retroactive tax cut. When you speak of those two things, will you insist upon one package of bills that includes the rate reduction and any kind of quick, short-term stimulus, or would you accept some kind of verifiable promise that they'll get to your tax cuts later?

BUSH: That's the old "trust me?"

QUESTION: Yes.

BUSH: It is in our nation's best interest to have long-term tax relief. And that has been my focus all along. I'm confident we can have it, get it done. I believe, not only can we get long-term tax relief in place, since our country's is running some surpluses in spite of the dire predictions about cash flow, I believe we have an opportunity to fashion an immediate stimulus package as well. The two ought to go hand in hand.

Those who think that they can say, "We're only going to have a stimulus package, but let's forget tax relief," misunderestimate our -- excuse me -- underestimate...

(LAUGHTER)

BUSH: Just making sure you're paying attention.

(LAUGHTER)

BUSH: You were.

(LAUGHTER)

BUSH: Underestimate our administration's resolve to get this done.

QUESTION: Can I just follow-up real quick? BUSH: No.

QUESTION: The Democrats...

(LAUGHTER)

(CROSSTALK)

BUSH: Go ahead.

QUESTION: Just quickly, the Democrats have demonstrated some flexibility on reducing the lower end of the tax rate reductions. How do you feel about the top? There's talk about the top rate not being as big as you propose.

BUSH: Of course, we ought to cut the top rate.

But see you're trying to do what Gregory tried to get me to do, which is negotiate with myself again.

QUESTION: I negotiated with Gregory over...

BUSH: Well, please do. When you all come up with a solution, let me know. Gregory is in the top 1 percent.

(LAUGHTER)

BUSH: If not, you should be, David.

(LAUGHTER)

BUSH: Last question.

QUESTION: Thank you, sir. You know, the last shall always be first.

QUESTION: Mr. President, you spoke about free trade at the last press conference, you mention it today. You'll be meeting tomorrow with the president of Brazil, Fernando Henrique Cardoso. He is the one person, I believe Brazil is the one person on the continent -- or the one country, who is not in a rush to come to a free trade agreement.

BUSH: Right.

QUESTION: They prefer Mercosur, you know, the free trade agreement in South America. Is your administration interested in getting the free trade agreement in by the 2003 year instead of the 2005 year, as has been agreed?

And how do you expect to convince Mr. Cardoso tomorrow to follow that?

BUSH: Well, the sooner we can get a free trade agreement in the hemisphere the better. As to whether or not it's 2003 or 2005, we'll just have to see if we can't convince our friends in South America of the wisdom of doing it as soon as possible. The meeting tomorrow is going to be an important meeting. But Brazil is a huge country, it's got a significant role in our hemisphere, and it's got a very bright future.

To the extent that the country is skeptical about our intention to have free and fair trade, you know, I might have a chance to undermine that skepticism, and I'm going to. I'm going to look the man in the eye and say, "We are free-traders."

And I will work with -- I will have Bob Zoellick work with his counterpart to assure him that trade with America will be done in a free and fair way. And I think we can make some progress, but we'll see after the meeting.

Thank you, all. See you tonight.

Right?

Look, I'm just testing a few lines on you, by the way. I think -- you just heard one, but you'll see when you hear me.

(LAUGHTER)

KAGAN: The president giving a little line there, leading up to tonight's Radio and Television Correspondents Dinner taking place in Washington, D.C., an event that the president of the United States usually does, traditionally, make an appearance at, and apparently, President Bush appears to do that.

A lot of time spent with the media, then, today. About a half hour of time spent with freewheeling questions before the White House press corps, the president talking about economic issues, like the House voting to pass a budget proposal and sending that on to the Senate. We also heard about Middle East violence, campaign finance reform, the environment, energy, and a patients' bill of rights.

Our Major Garrett was right there in the news conference, and we can talk with him now.

Major, first let's talk about the format and just the event itself. We really have not seen a lot of the president in this type of environment, with a half hour of questions just peppered at him from the White House press corps.

GARRETT: Yes, Daryn, this is the second time the president has come to the briefing room to have a press conference and the second time that appearance came with relatively short notice. We were given all of 45 minutes to prepare this morning. The last time, about four weeks ago, we were given all of an hour. That has caused some consternation among reporters. They like to have a little bit more advance notice to prepare their questions for the president.

And he's never had an East Room formal, nationally televised press conference. Yesterday, the press secretary to the president, Ari Fleischer, said the president's not really interested in that format, at least not yet. He said the American people doesn't give a whit -- his words -- where the president takes questions from reporters, just that he does.

He did so today in part because the White House does want to get back into the news. They felt a little bit suffocated yesterday with all the attention on Capitol Hill focused on campaign finance reform and very little on what the White House considers a very important House vote to pass the president's budget.

There's another big vote on that budget next week in the Senate, and the president wanted to tee up that debate. At least in part, that was the reason he came to the briefing room this morning.

KAGAN: Let's talk about some of the issues that the president did bring up. He spent a lot of time talking about Middle East violence, saying he's calling for restraint on both sides and has talked to Palestinian and Israeli leaders. But he's saying, in a departure from the Clinton administration, he doesn't think the U.S. should force a timetable or any kind of settlement on the people involved in this conflict.

GARRETT: Yes, that's really a change in nuance. The Clinton administration didn't say that it was trying to force an agreement, but what it did say was that it was going to be actively involved with all the participants on a regular basis, to do what it could to build a foundation for peace.

Now, that's oftentimes what the president says: He wants to build a foundation for peace. And really, in the Middle East, it's become a question of semantics and nuance. One thing, though, is very different, at least up until now, about the way this administration has dealt with the Middle East, and that is, as aides have said to us many times on background, we're going to sort of take a step back, have an arm's length relationship to what's happening in the Middle East.

Several Middle East analysts that CNN has talked to have said, really, that's not a practicable approach for any White House, that the Middle East, because of its crucial importance to the United States and throughout the region, always draws in presidents, who at first say they'll step back.

What we saw today, here in this briefing room, was proof that that's really true. The president of the United States came to the podium to say to the parties, you need to eliminate the violence -- I'm telling you, as the president of the United States, the leader of free world, you must take more steps -- I'm specifically telling the Palestinian Authority that you must use language that your own people can understand, to stop the violence. The president of the United States is doing something his aides have assured us for weeks now he would try to avoid: stepping in personally to the Middle East crisis.

KAGAN: Yes, perhaps drawn in more than the president wanted to, as he said in past comments, but Major, he also did go back to his previous tact of saying we need to look at the Middle Eastern region as a whole, and he stressed that he's going to meeting with Egyptian and Jordanian leaders in coming days. GARRETT: That's right. One of the White House strategies is to try to build as strong a foundation of relationship with moderate Arab nations -- the Egyptians, the Jordanians -- to get them to contain the violence as it's occurring right now and be supportive of whatever peace agreement the Palestinians and the Israelis may reach in the future. That's not a brand-new approach, but it's an approach that goes to moderate Arab nations first, before going to the Palestinian leadership, Yasser Arafat.

The president avoided a question here this morning about whether or not he would invite Yasser Arafat to the White House. It is pretty clear now from the president's words and from the statements of his senior advisers that until Mr. Arafat does what the White House seeks him to do -- which is to renounce violence as means of attaining political ends -- he will not be invited to the White House.

But they will have continuous phone conversations with him. The president said Secretary of State Colin Powell will be on the phone with Mr. Arafat today, but as far as coming to the White House and receiving what this president believes is the conference of legitimacy which a visit to the White House brings, that's not going to happen until Mr. Arafat does more to deal with violence on the ground.

KAGAN: All right, Major, let's have you stand by at the White House.

Let's bring in our Bob Franken, who's on Capitol Hill to talk about the topic that the president started his news conference with, this passage of this budget proposal by the House, pushing it on to the Senate.

Bob, how significant is that passage, and what kind of roadblocks and obstacles will it face in the Senate?

BOB FRANKEN, CNN CORRESPONDENT: Significant ones, actually. The House, even though it just has a slim GOP margin nevertheless has one. The Senate, which, of course, inherently slows things down, will slow it down even more because it is split 50-50. The budget as currently constituted, and the tax plans that accompany it, are going to face very rough going in the Senate, even with this presidential push.

I would also point out that while the president wanted to shift the subject to the budget, from the emphasis on campaign finance, sorry, President Bush, the fact of the matter is that the emphasis right now on Capitol Hill is on campaign finance, which is what is being debated and has been debated, with high publicity, for the last couple of weeks.

KAGAN: Very good, Bob Franken, on Capitol Hill, thank you so much.

Our thanks also go to Major Garrett, at the White House.

There you have it: a live news conference with the president -- about a half hour of answering questions from the White House press corps. TO ORDER A VIDEO OF THIS TRANSCRIPT, PLEASE CALL 800-CNN-NEWS OR USE OUR SECURE ONLINE ORDER FORM LOCATED AT www.fdch.com

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