The White House

Office of the Press Secretary

Press Gaggle by Press Secretary Jay Carney en route Ohio, 7/5/12

Aboard Air Force One
En Route Ohio

10:30 A.M. EDT

MR. CARNEY:  Welcome aboard Air Force One as we make our way -- on the start of a two-day trip as we make our way to Ohio.  You can see that I am joined by Jen Psaki, who is back by popular demand.  She begins today as campaign press secretary.  And with your indulgence, what we'd like to do is brief together, gaggle together.  So if you have truly campaign-related questions, you should direct them to Jen.  If you have policy questions, administration policy questions, direct them to me.  If you have questions that cover both areas, we'll decide between us how we're going to answer them and probably each take a shot at them.

I wanted to note before we get started that earlier today, the Obama administration launched an enforcement action against China at the World Trade Organization for imposing unfair duties on more than $3 billion in auto exports from the United States.  The Chinese duties in question cover more than 80 percent of U.S. auto exports to China, including cars manufactured in Toledo and Marysville, Ohio, and Detroit and Lansing, Michigan.  And the duties disproportionately fall on General Motors and Chrysler products because of the actions that President Obama took, as you know, to support the auto industry during the financial crisis.

This is the seventh such action that this administration has taken against China -- seventh.  The previous six have all been successful.  The pace of actions taken by this administration is double that of the previous administration -- actions against China for unfair trade practices.  And I think it underscores the President's commitment to American companies and American workers -- his commitment to them to make sure that when they compete with their products and their know-how around the world they're competing on a level playing field.  

So that action was submitted today in Geneva at the WTO.  As is common practice, the Chinese were given a courtesy heads-up that this action would be taken.

And with that, we will answer your questions.  

Q    Jay, how do you answer people who might say the timing of this and the announcement of it by the President at a campaign stop in a battleground state makes it really more of a political move than a well-considered step in American trade policy?

MR. CARNEY:  The fact is this is an action that has been in development for quite a long time.  The USTR studies these issues and prepares actions with great deliberation to ensure their success at the WTO.  This one has been in development for many, many months, and that’s just a fact.

And again, this is the seventh such action that this administration has taken.  It simply can’t suddenly be a political action because it happens during the campaign.  The President is committed to doing this throughout his presidency and will continue to take these actions when they’re appropriate to ensure that there’s a level playing field for our businesses and workers.

Q    This affects carmakers or plants in Toledo and he’s going to the Toledo area today to campaign.  That’s not a coincidence.

MR. CARNEY:  Well, look, I think that the timing is determined by USTR after long development of a case to be made at the WTO as filed in Geneva.  As you guys note all the time, we’ve been to Ohio on a number of occasions and I’m sure we’ll be back. And certainly now that we’re in more of a campaign mode, you can expect he’ll be back.  But he never ceases being President of the United States and, as such, he has directed the Ambassador of the USTR to investigate matters like this and take action where appropriate to ensure that American workers and businesses compete on a level playing field with China and other nations.

Q    But on the matter of timing, Jay, they clamped this tariff last year.  Why did it take this long, and again, why today?

MR. CARNEY:  You can ask the USTR about their process for developing a case.  But obviously you do not react immediately.  You develop a case; you do a lot of research; you put together the necessary documentation and back-up and support in order to be successful, precisely because it’s not a political issue, it’s an issue that goes right at the heart of our economy.  

I don’t need to remind you, but I will, that this President took what was seen as very bold and risky action to ensure that General Motors and Chrysler, during the great recession, did not liquidate because of the enormous pressure on the American automobile industry.  Had that happened, according to a study done by the Bush administration in December of 2009 -- or 2008 rather -- the United States would have lost 1.1 million additional jobs.  And some studies suggest that had the American automobile industry been forced to liquidate not just GM and Chrysler but, because of the supply chain, Ford eventually as well, that the job loss would have been ever more substantial.

We’ve seen a revival in manufacturing in this country.  We’ve seen the revival in the automobile industry, job creation in the automobile industry that we have not seen since the mid-1990s.  This is all happening because of actions the President took.  And it is vital that the United States -- in this case the Obama administration -- take the right action to ensure that companies like GM and Chrysler and others can compete fairly around the world.

MS. PSAKI:  If I can just add one thing to this.  As you know, one of the first actions the President took regarding China was to put in place stiff tariffs in 2009 on Chinese tires.  Many people didn’t read Mitt Romney’s book.  If you did read Mitt Romney’s book, you’ll note that in there he criticized the President for this step, for taking this step.  He said it was bad for workers; it would be bad for the country and the nation.  
Along this trip, the President will meet many autoworkers.  He’ll meet people who would be impacted by this, who would, no question, say something different.  So that’s something to look out for on the trip as well.  

Q    Republicans and Romney now argue that the President should declare China a currency manipulator, which is something he has declined to do.  Is that something that’s going to be revisited at all before the election?  And if not, why not?

MR. CARNEY:  Well, for the specifics of how we evaluate that, I would direct your question to the Treasury Department.  But this administration always brings up our concern about the Chinese currency in our conversations with Chinese leaders, both at the level of President Obama and President Hu, as well as in ministerial meetings that Secretary Geithner engages in, and others.  

The fact is that the currency needs to appreciate more.  There have been some steps taken over the last several years but not enough.  And this continues to be something that is a high priority in our conversations with and diplomatic efforts with China.

Q    -- Mitt Romney now saying that the health care mandate is a tax and not a penalty?  Isn't that essentially agreeing with the Supreme Court decision that's calling it a tax?  

MS. PSAKI:  For years -- I was going to say decades, but that's not true -- for years, Mitt Romney has been defending not only his bill that he pushed forward in Massachusetts but also this as a penalty that was essential to taking into account the people who weren’t paying for health insurance who could afford it.  The President agreed with him.  That's for years up until Monday, when his own campaign spokesperson defended it the same way.

So Mitt Romney is -- it's clear that he is being impacted by the push from the right, the Rush Limbaughs of the world, congressional Republicans, who are pushing him to go back on a decision and a defense that he's had in place for years.  

You'll hear the President today touch on health care in his remarks as part of his discussion of standing up for and fighting for the security of the middle class and he'll talk about the importance of making sure people in this country aren’t worried about going bankrupt over health care, posing the question of we don't want to take away from the millions of young people who have insurance, that benefit that they've been -- they've received for the last several months.  

And that's really the question we should be dealing with now, not this silly debate that is, again, Mitt Romney going back -- being influenced by the extreme right of the party and going back on a defense he's had in place for years.

MR. CARNEY:  But if I could just add as a matter of policy, it is simply a fallacy to say that this is a broad-based tax.  That's not what the opinion stated that was authored by the Chief Justice.  The Affordable Care Act is constitutional under Congress's taxing authority, but this is clearly a penalty that affects less than 1 percent of the American population.  And it is a penalty you only pay as a matter of choice, if you're in that 1 percent and you can afford health insurance but choose not to and therefore choose to pass the responsibility for your health care to every other American, which I would note that Governor Romney, when he was governor, thought was unfair and therefore instituted a penalty -- and clear the President does, too, which is why the penalty that's part of the Affordable Care Act was modeled very much on what Governor Romney implemented in Massachusetts.

Q    Does the President believe that the mandate can be a penalty on the state level but a tax on the federal level?

MR. CARNEY:  Look, it's a penalty.  It affects 1 percent, and perhaps less, of the population.  It is a -- I don't know about you, but you don't get to choose whether you pay your income taxes -- most people don't.  I certainly don't.  This is not a tax in that sense at all.  It is a penalty you pay if you fail to buy health insurance but can afford it.  

And the reason why the penalty is important is that it's simply not fair to get a free ride and force other -- every other American to pay for your health care if you can afford it.  So that's why it was the right approach when it was implemented in Massachusetts and it's the right approach as part of the Affordable Care Act.

Q    Can I ask one more political question, maybe for Jen?  Jen, the unemployment rate in Pennsylvania and Ohio is somewhat lower than nationally.  Do you guys believe that voters make their decisions principally on their perception of the health of the national economy, or are they positively affected by the fact that things may be somewhat better closer to home?

MS. PSAKI:  Well, as you know, we're going to be spending two days in Ohio mainly, and partly in Pennsylvania.  And the places where we'll be visiting over the next couple of days have been largely impacted by the recovery of the auto industry and the difficult steps the President took there.

I think voters and the American people are impacted by what challenges they're facing every day.  So that is, do they have a job?  Can they afford to send their kids to college?  Can they afford access to health care?  You'll hear the President talk about this today.  There are many issues that impact the security of the middle class, and that's what families are worried about day to day, especially in the places we'll be visiting over the next two days.

Q    What's it like to be back?

MS. PSAKI:  Great.  I wouldn't want to be anywhere else.

MR. CARNEY:  I say that every day when I'm with you guys.  (Laughter.)    

MS. PSAKI:  Jay says he is living the dream every day, one day at a time.

MR. CARNEY:  I am.  It's the best job ever.  It's good to see you guys.  Anything else?

Q    Jen, is it basically going to be the same message tomorrow as today?

MS. PSAKI:  Yes.  You'll hear the President talk today, as I mentioned, about fighting for American workers, his bet on workers in Ohio and Pennsylvania.  He'll talk about the contrast and the difference between the visions that he is presenting and Mitt Romney is presenting on many issues that impact the middle class, including health care, including education, including access to -- including tax cuts.  So you'll hear him talk about that consistently over the next two days.

I should note also, as often happens, he'll be making some local stops along the way.  As is standard, you'll learn where they are and what they're about.  But they all will be opportunities to talk about the same issues.

MR. CARNEY:  I know that as a matter of policy I think that the President will also talk about his initiatives that he's put forward that he hopes Congress will act on to create incentives for American companies to come back to the United States, and to close loopholes that create incentives for companies to offshore -- move their operations and their hiring offshore.  

And it's a very important matter that the President has been pursuing for a number of years now as a matter of policy, because his commitment is to -- as you saw with the American automobile industry -- is to create an economy that's built to last, that has an important manufacturing component, and that allows for jobs in the United States that create the kind of security that middle-class Americans desperately deserve, and the kind of security that in the first decade of the century was eroding very rapidly.

Q    Thank you.

MS. PSAKI:  You must leave room for the ice cream social later this afternoon in Sandusky.  I don't know the flavors, but something for everyone.

10:45 A.M. EDT

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