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Aboard Air Force One
En Route Philadelphia, Pennsylvania
10:48 A.M. EST
MR. EARNEST: Good morning. It's nice to gather in this setting once again after a few weeks.
As you know, we're headed to Hatfield, Pennsylvania, where the President will tour the K'NEX workshop, visit with some workers at that facility, and of course deliver some remarks. In those remarks, he will make clear that any deal to avert the so-called fiscal cliff will require higher tax rates for the wealthiest 2 percent of Americans. He will also call on House Republicans to act expeditiously to vote on something very rare in Washington, D.C. these days: a policy that has strong bipartisan support. He wants House Republicans to do what the Senate has already done -- enact legislation that will prevent an income-tax hike on 98 percent of Americans and 97 percent of American small businesses at the end of the year.
Preventing this tax hike isn’t just good for middle-class families, it’s also good for businesses like K'NEX. That’s why the President is ready to sign that bill as soon as it passes the House.
So with that, I’ll take your questions.
Q Josh, as you point out, the President is asking for those tax rates for the -- and tax cuts for upper-income Americans to go back up, but that alone only generates about $848 billion over 10 years. The President apparently is asking for about $1.6 trillion, at least in the offer that the Republicans made public yesterday. Why is the President asking for double the amount that has been kind of the marker for revenue in past discussions with the House?
MR. EARNEST: Well, my sense is, is that the marker for revenue that the President has discussed for quite some time now -- it was included in the defense-reduction package that the President rolled out in the Rose Garden in September 2011, the marker that was laid out in the President's budget that was presented in February of 2012, and the marker that was presented in the context of the balanced approach to deficit reduction that the President advocated throughout the campaign -- was $1.6 trillion in tax revenue.
There are specific policies that the President had laid out that would do this that would prevent those who are making less than $250,000 a year from having to pay higher taxes. What this does is this is the way that we can ask the wealthiest Americans to pay a little bit more to deal with our deficit challenges. That’s what the President has campaigned on for quite some time, it's what got a strong endorsement of the American people in the election, and that’s what the President is pushing for in the context of these discussions with House Republicans.
Q $1.6 trillion is negotiable or it can go down? It can be much lower than that?
MR. EARNEST: I'm not going to negotiate it from here, but the President has laid out a clear and specific path for asking the wealthy to pay a little bit more to deal with our deficit challenges. This is part of a balanced approach that includes some proposals to reform entitlements, to make cuts in government spending. And that balanced approach is what the President is advocating -- not just because it will do something important for our deficit challenges, which it will do; it will reduce our deficit by $4 trillion over 10 years -- but most importantly, what it will do is it will actually lay the foundation for a strong and vibrant American economy.
That’s what the President is focused on -- a strong economy, an economy where middle-class families have the opportunity to succeed, and an economy that will support the kinds of policies that will create jobs. Those are the President's priorities, and those are the priorities that the President is pursuing in the context of these negotiations.
Q Will you release a copy of Secretary Geithner's plan? And can you tell us --
MR. EARNEST: It sounds like the Republicans already did that last night.
Q Well, we would like to have it from the White House. Is that something that you guys will release?
MR. EARNEST: We'll talk about it. But here is the thing: there is nothing that is -- was included in those discussions that is going to come as a surprise to you. I know that there were comments from House Republican staffers and Republican staffers on Capitol Hill who expressed surprise at the President's proposal. And I have to admit that this morning I was surprised that they were surprised.
Again, what Secretary Geithner talked to them about yesterday were exactly the kinds of things that the President has been talking about for well over a year. I would be willing to bet the President actually made a reference to this balanced approach deficit reduction in every single speech that he gave in the campaign. Every single one.
And so there’s no reason for anybody to be surprised here. So we’ll take a look at the paper, but what the President has articulated and what Secretary Geithner discussed yesterday is something that we have discussed publicly for quite some time.
Q But the $400 billion in entitlement savings -- can you give us a little more detail about what changes you're proposing there? And will the President talk with Speaker Boehner today?
MR. EARNEST: I’m not going to walk through every single detail of our proposal. I mean, there are some things that are included in there that we -- that are -- that, again, have been on the table for quite some time, including in our Fiscal Year 2013 budget proposal that was presented in February of 2012. But this includes things like $100 billion in savings for Medicare prescription drugs. Medicare can purchase -- use their bargaining power to make prescription drug purchases more efficient. We can save $100 billion by doing that. The President has also included in his budget asking wealthy seniors to pay a little bit more Medicare payments.
So there are a number of ways that we can -- including placing reforms to Medicare. Now, the key to this is the President wants to ensure that these reforms will actually strengthen the programs and extend the life of these programs over the long term. And these are the kinds of things, again, that we’ve been talking about for quite some time, that we’ve been talking about -- and have also been the substance of the discussions that Secretary Geithner and Rob Nabors had yesterday.
Q Well, if you've been talking about it for a long time, the word you used is "surprised." Why go in with that proposal? I mean, were you surprised that the Republicans didn’t like that proposal?
MR. EARNEST: Well, the proposal that was presented to Republicans yesterday has the strong support of the majority of the American people. This is the -- this is what -- this is the approach that the President has talked about for a long time now. This is an approach that garnered the President a lot of support in the election.
And so I know that there are some Republicans who have remarked that they feel like they’re a long way from where the President is on this. That also means those Republicans are a long way from where the American people are on this.
Q This also means that you all are a long way from finding a compromise.
MR. EARNEST: This means that in order to get a compromise done, we’re going to have to have people on the other side of the aisle who are willing to set aside their partisan interests and work with the President in bipartisan fashion to act in the best interests of the American economy.
Now, here’s the thing. I know that there have also been House Republicans and Senate Republicans who have expressed some dismay and some concern about meeting the deadline. We’re not that far apart. It’s very clear what we need to do to get this done. It is a bipartisan approach. It has the strong support of the American people. And the President is going to get it done.
So all we’re waiting on right now is House Republicans to acknowledge one very simple thing, which is that tax rates on the wealthy must go up to get this deal done. That is a critical part of a balanced approach. It's a critical part of the balanced approach that has the strong support of the American people, and once that fact is acknowledged, then we can get this done pretty quick.
Q Josh, on the U.N. upgrade of the Palestine status, is the United States planning any immediate steps to, say, withdraw funding from U.N. agencies, or other reactions that are substantive?
MR. EARNEST: No. What we have talked about and what Ambassador Rice articulated yesterday was our opposition to that vote in the United Nations. Our opposition is based on one thing, which is our belief that a solution to this long conflict between the Israelis and the Palestinians will only be resolved by face-to-face negotiations that will result in a Palestinian state and an Israeli state living side by side in peace and security.
That is the ultimate goal, and it is our view that that goal will be achieved only through face-to-face negotiations not through unilateral actions like we saw yesterday at the U.N.
Q And on the fiscal cliff, can you say why a -- you would expect -- you're surprised that -- congressional surprise not withstanding -- why you would expect them to accept a unilateral ability to raise the debt ceiling without their approval?
MR. EARNEST: Well, for a couple of reasons. I think even my Republican friends on Capitol Hill would acknowledge that the roiling, wrenching debt-limit process that this country went through in the summer of 2011 was not in the best interests of our economy, it’s not in the best interests of taxpayers -- it wasn’t even in the best interest of the global economy.
So what was -- what did come out of that process, though, the debt-ceiling negotiations in August 2011, was a workable mechanism that I believe was proposed by Senator McConnell to ensure that politics doesn't get injected into the process and that we can have a manageable way of dealing with the debt limit that doesn't put at risk the full faith and credit of the United States of America. And I think it’s reasonable that the President would propose to continue using that process moving forward.
Q So the administration's proposal on the debt ceiling was -- mirrored Senator McConnell’s approach from the previous negotiation?
MR. EARNEST: I mean, basically, yes.
Q So you would do it in tranches just like you did the last one? It was --
MR. EARNEST: Well, I’m not going to go through the full details here, but as I mentioned, through the wrenching process of August 2011, Senator McConnell proposed a workable process, a manageable process that ensured that we could deal with the debt limit in a way that didn't allow either side -- and in the case of August 2011, the House Republicans -- to play chicken with the full faith and credit of the United States. That had terrible consequences for our economy. It had bad consequences for the global economy. And the process that's been in place for the last year or so has avoided that from happening. And the President believes it’s natural that we would extend it.
Q Josh, can you comment separately on the adoption of a constitution in Egypt? It's resulted in more protests on the street and some concerns that it’s too much of an Islamic document.
MR. EARNEST: Well, I haven’t reviewed any of the details of what has apparently been -- is working its way through the process there.
What we have said all along is that we wanted to support the Egyptian people through the process; that they would have a constitutional document and a government that reflected the will of the Egyptian people. And that has been our interest from the beginning -- a government that reflects the will of the people; that respects racial, religious and ethnic minorities. These are the kinds of principles that we’ve espoused not just in Egypt, but in other countries throughout the region.
But in terms of a reaction to this specific document, I don’t have one.
Q Do you have any week ahead for us before we go?
MR. EARNEST: I do. I think we’re going to land here so everybody hold on for a second.
Q Christi doesn’t stand on perfect landings.
MR. EARNEST: I don’t blame her.
Q She’s opposed to it.
MR. EARNEST: I’ll go through this quick. On Monday, the President will host Prime Minister Borisov of Bulgaria at the White House. The President welcomes the opportunity to discuss a broad range of bilateral and regional issues during their Oval Office meeting, including Bulgaria’s leadership at NATO and its valuable contributions to the International Security Assistance Force in Afghanistan. The President also looks forward to receiving updates on Bulgaria’s investigation into the July 2012 terrorist attack in Burgas, and ongoing rule of law and judicial actions.
Later that day, the President will deliver remarks to the Nunn-Lugar Cooperative Threat Reduction Symposium being held at the National Defense University. On the 20th anniversary of the CTR program, the President will note the extraordinary progress that’s been made in securing nuclear material, thanks to Senators Nunn and Lugar for their -- and thank Senators Nunn and Lugar for their longstanding leadership on these issues.
On Tuesday, the President will meet with governors at the White House, where they’ll discuss the actions we need to take to keep our economy growing and find a balanced approach to reduce our deficit.
On Wednesday, the President will deliver remarks to members of the Business Roundtable. Later that day he’ll also deliver remarks to the 2012 Tribal Nations Conference.
On Thursday, the President and the First Family will attend the National Christmas Tree Lighting on the Ellipse.
And on Friday, the President will participate in the ever-popular meetings at the White House.
Q Is the meeting with governors bipartisan governors?
Q Is it all of the governors? Do we know which governors, in other words.
MR. EARNEST: I believe that some of the invites have gone out. I don’t know that we have the final list, but I’m sure that in advance of the meeting we’ll be able to give you a list.
Q And will the President talk to Boehner or McConnell today?
MR. EARNEST: I don’t have any scheduling updates to read out but --
Q Can you keep us posted?
MR. EARNEST: I will try. As you know, the President will regularly have phone consultations with Congress that we don’t often -- we don’t read out every one.
Q Or often. (Laughter.)
MR. EARNEST: But we’ll do our best.
Q Josh, what was the President’s reaction to the U.N. vote? It didn’t come as a surprise, obviously, but what’s his level of concern about the impact this could have on the peace process?
MR. EARNEST: Well, the President’s personal views here are reflective of the administration’s position, which is that these kinds of unilateral actions are not helpful. This is only going to get resolved through face-to-face bilateral negotiations between the parties. The goal here is a two-state -- is two states, one Israeli, one Palestinian, living side by side in peace and security. And unilateral actions like this don’t advance that effort, and that’s not just the administration’s position, it’s the President’s personal view.
Q And I think you said that the administration is not considering cutting off aid --
MR. EARNEST: Right.
Q -- to the P.A., but are there other consequences maybe under consideration, like perhaps having to do with their mission in the U.S.?
MR. EARNEST: Nothing that I have to report out at this time. I mean, the reason for that is simply that our aid to the Palestinians is an important part of our relationship. And we believe that we can -- the United States can and should play a constructive role in facilitating negotiations between the Israelis and Palestinians. So we want to make sure that we have an open channel with both sides. But in terms of any specific actions that are being contemplated, I don’t have anything on that for you.
Q So if a bill came to his desk that cut off aid he’d veto it.
MR. EARNEST: I’m not -- veto threats. I don’t know what’s moving through Congress on that front. All I can tell you is that it is not our view that cutting off aid is the right thing to do.
Q Thank you.
MR. EARNEST: We’ll see you shortly, guys. Thank you.
Q Is Geithner or anybody on the Hill today of that high level?
MR. EARNEST: I don’t know the answer to that. There is actually one other thing that I forgot, which is just that Senator Casey and Congresswoman Schwartz are both on the plane today.