The White House

Office of the Press Secretary

For Immediate Release
February 19, 2014

Press Conference by President Obama, President Peña Nieto, and Prime Minister Harper

Patio Central
Palacio de Gobierno
Toluca, Mexico

7:25 P.M. CST

PRESIDENT PEÑA NIETO:  (As interpreted.)  Ladies and gentlemen, good evening.  Members of the media.  Your Excellency, President of the United States of America Barack Obama; Prime Minister of Canada Stephen Harper.  Once again, I would like to welcome you to our country.

It is a great honor to have hosted you for the North American Leaders Summit here in the State of Mexico, and Toluca, its capital city -- a state that I had the great honor of being the governor of before I took office with the greatest honor in the world of politics, and that is to lead the course of my country.

That is why I am very glad that we have had the opportunity of having this meeting.  And I'd like to congratulate myself for creating a space where we have had dialogues, where we have outreach to our countries, and where we have strengthened our friendship.  I can be certain that the warm space where we have met is very different from what the teams of men and women representing Mexico in Sochi are having in Russia.  They are in very cold weather and fighting hard to win a medal.  So be welcome to this very warm weather.

I would like to summarize for the media and for your delegations the scope of our meetings.  I would like to share with you that we have two highlights in our meetings.  First we had a bilateral with President Barack Obama and with his delegation and their counterparts from Mexico to address the following, and I would like to share this with you. 

First of all, we assessed the breakthroughs related to the agreements made during President Obama’s past visit in May to our country, and now during his fifth visit -- and I must note that Mexico ranks top of the list of the most visited countries by President Obama during his term.  And we were able to identify the level of progress of the agreements made back then; how much we have advanced the exchange between high level officials to precisely boost the trade and commercial relationship that Mexico and the U.S. have.

We have also analyzed the possibility of setting forward new mechanisms to build and fund strategic projects.  We have agreed to work on a proposal that would help us find different mechanisms to fund projects so that we can give a new life to our infrastructure, to have more agile and have safer commercial transactions between our countries. 

Specifically, we talked about education.  We have set the task to have more academic exchanges so that more Mexican students can study in the United States and, reciprocally, students from the United States come to Mexico to study.  The number of students so far is somehow low, considering the potential that we have.  And out of the 14,000 students from Mexico that go to the United States to study, we have set a goal and that is to increase year by year this figure and reach 100,000 students a year that visit the United States, and 50,000 students from the U.S. coming to Mexico to study.

We have revised our security agenda and we have agreed to maintain a strategic dialogue, to coordinate efforts so we can face a common issue -- security in both of our countries and, specifically, security at the border. 

On the other hand, I would like to refer to the outcome of the North American Leaders Summit.  Therefore, I would like to share with you highlights in terms of the agreements reached in this framework.  We have worked on four main topics.  The first one is to foster shared and inclusive prosperity.  We have agreed to work on a plan to boost competitiveness.  We also have agreed to work on a North America transport plan which would give us better infrastructure in our three countries to make the commerce that happens between our three nations thrive.

We also agreed to standardize and expedite all the procedures that take place in our customhouses.  We have also agreed to enable the movement of individuals, and by this have Trusted Travelers Programs.  We have, each one, a program of this nature with a purpose in mind that all the travelers that are part of the Trusted Travelers registers in our countries are considered as a vetted traveler in North America.

Additionally, in terms of the second topic, we have addressed areas of opportunity.  And I must insist, in terms of our binational agenda with the United States, we have added up Canada to work on a program to train professionals by increasing our academic exchanges and ensuring mobility of students between our three countries.

We have also agreed to foster sustainable development, working towards the mitigation of the effects of climate change. And in the area of sustainability, we have also agreed to work on the preservation of the Monarch butterfly.  It is a landmark species in North America.  This is a species present in our three countries, and we have agreed to work a taskforce with a presentation from our three countries to preserve the Monarch butterfly.

Then, another topic is citizen security and regional topics. We have agreed to give privilege to the exchange of information, and we have also privilege to coordinate efforts between law enforcement authorities.  We will reinforce the measures aimed to fight money laundering and illicit financial flows.  And for that purpose we need to integrate our financial systems further.

We have also restated our commitment to support and cooperate with the Central America region as well as the Caribbean because they are partners in this hemisphere.  We have committed to foster development, economic growth and citizen security as well.

Basically, I have summarized the commitments made during the summit.  And fourthly, we have committed, the three of us, to give follow-up to all the agreements made.  Besides making agreements, we have committed to give follow-up to each one of those agreements and we have committed to make them happen.

Finally, I would like to share with you that in order to reach our goals we need to identify that North America is quite valuable.  The Free Trade Agreement executed 20 years ago and the intense dialogue that we have between our three countries in the North American region is very valuable and every exchange is based on trust.  And we share a very good relationship between all of us who lead our countries.

This North America Leaders Summit has been a very good opportunity to specify what our commitments will be and what are the tasks for the future.  And it has also served as a space to restate our friendship, the good relationship that we have and the respect that we pay to each other.  And we have committed to work hard to make a significant contribution, to make North America a more competitive region -- I would dare to say the most competitive region in the world.  And this is a region that has a true call for prosperity.  And we will work to provide better well-being to the citizens of our countries. 

We have made great strides.  We create plenty of jobs due to the economic relationship that we have managed to achieve, but we want more.  We want more development.  We are aware of the potential that we find in North America.  And I make a pledge so that the seventh summit of leaders of North America serves its purpose. 

Once again, we welcome, and I would like to say that I hope you have had a very pleasant stay in Toluca and I hope that this visit has been very fruitful.  And I hope that we have been able to build an even stronger relationship. 

Thank you.  (Applause.)  

PRESIDENT OBAMA:  Buenas noches to President Peña Nieto.  To the people of Toluca and the people of Mexico, thank you so much for your extraordinary hospitality.  Thank you again, Enrique, for welcoming us to your hometown and home state, which -- like the beautiful surroundings tonight -- reflects Mexico’s proud history as well as the economic dynamism of today’s Mexico.

I want to thank President Peña Nieto and Prime Minister Harper for their partnership in deepening the extraordinary ties between our countries -- especially the trade that supports good jobs for our people.  For the United States, Canada and Mexico are two of our largest trading partners with trade that supports millions of American jobs.  Thanks in part to our efforts to boost U.S. exports, American exports to Canada and Mexico continue to grow faster than our exports to the rest of the world. 

Together, our countries have strengths that give North America a tremendous competitive advantage -- the skills of our workers, manufacturing that’s growing, and new sources of energy. So we have to take advantage of these competitive advantages, and we need to do it together.  All of this positions us to be a powerhouse in the global economy.  And that’s why we’re here, to make sure that we’re doing everything we can to be more competitive and create more jobs in Canada, in Mexico, and in the United States. 

First, we’re focused on making it easier to trade.  Earlier today, I signed a new executive order to make it easier for companies that want to export and import.  Instead of dealing with dozens of different federal agencies and long paper forms, we’re going to create a one-stop shop online, so companies can submit all their information in one place and save themselves time and money.  We’re going to keep investing in infrastructure -- like roads, bridges, border crossings -- so our goods are getting to market faster.  We’ve agreed to keep working to make it easier for our businesspeople and tourists to trade and travel.  And we’re going to step up our efforts to streamline and eliminate regulations or the red tape that can sometimes stifle trade and job creation. 

We’ve agreed to keep working to complete negotiations on the Trans-Pacific Partnership, including strong protections for our workers and the environment, so that we can compete in the fast-growing markets of the Asia Pacific.  And because it will grow the U.S. economy and make the United States more attractive to investment -- and because we have to do right by our families and our values -- I’ve reiterated that immigration reform remains one of my highest priorities.

I’m also very pleased that we’ve agreed to keep expanding educational partnerships, as Enrique mentioned, so our young people develop the skills they need to succeed in the global economy.  And this builds on my initiative that we call 100,000 Strong in the Americas.  We want more students from the United States studying throughout the hemisphere, and we want more students from places like Mexico and Canada studying in the United States -- so that they’re developing familiarity and partnerships and friendships that will serve them and serve our countries well for decades to come.

Second, we continue to deepen our clean-energy partnerships, which create jobs and combat climate change.  Yesterday, I announced that the United States will develop new fuel economy standards for heavy-duty trucks -- standards that reduce carbon pollution.  And today, all three of our nations have agreed to work together to meet high fuel standards for these heavy-duty trucks.

And more broadly, we agreed to join with our Central American and Caribbean partners on a regional energy strategy.   And this builds on the commitment I made in Central America last year to help our partners across the region reduce their energy costs and become more competitive.  On a global level, we agreed to keep standing together as we push for an international agreement to phase down the production and consumption of dangerous hydrofluorocarbons. 

Number three, we know that realizing our full potential as individual countries and as a region means confronting the criminals and narcotraffickers who unleashed so much violence on our citizens.  Here in Mexico, the security forces and the Mexican people continue to make enormous sacrifices in that fight, and our three nations are united against this threat.  In the United States, we continue to be committed to reduce the demand for illegal drugs and we’ll continue our unprecedented efforts to combat the southbound flow of illegal guns and cash.

And, finally, given our shared commitment to democratic values and human rights, I want to take this opportunity to address the situation in Venezuela and Ukraine, and the unacceptable violence in those two countries, which the United States strongly condemns. 

In Venezuela, rather than trying to distract from its own failings by making up false accusations against diplomats from the United States, the government ought to focus on addressing the legitimate grievances of the Venezuelan people.  So, along with the Organization of American States, we call on the Venezuelan government to release protestors that it’s detained and engage in real dialogue.  And all parties have an obligation to work together to restrain violence and restore calm.   

With regard to Ukraine, along with our European partners, we will continue to engage all sides.  And we continue to stress to President Yanukovych and the Ukrainian government that they have the primary responsibility to prevent the kind of terrible violence that we’ve seen, to withdraw riot police, to work with the opposition to restore security and human dignity and move the country forward.  And this includes progress towards a multiparty technical government that can work with the international community on a support package and adopt reforms necessary for free and fair elections next year.

Ukrainians are a proud and resilient people who’ve overcome extraordinary challenges in their history, and that’s a pride and strength that I hope they draw on now.  Meanwhile, I've urged the military in Ukraine to show restraint and to let civilians pursue the dialogue necessary for progress.  We’ve obviously seen reports of a truce between the government and the opposition.  If the truce is implemented, it could provide space for the sides to resolve their disagreements peacefully. 

And going forward, we’ll continue to do whatever we can to support Ukrainians as they seek a peaceful resolution and respond to the aspirations of the Ukrainian people for a strong, unified democracy that’s fully integrated into the international community.

So, again, I want to thank Enrique and the people of Mexico, and the people of Toluca, for their wonderful hospitality.  If we stay focused on our shared vision -- a North America that’s more integrated and more competitive -- then progress in each of our countries will mean more prosperity and opportunity for everyone.

Thank you very much.  (Applause.)

PRIME MINISTER HARPER:  (As interpreted.)  Allow me to start out by thanking President Peña Nieto for his generous hospitality.  We have had a wonderful stay in this wonderful country, in Mexico, and we are eager to come back soon.

Today, I had fruitful meetings and dialogues with my commercial partners from Mexico in regard to services, information, and also shared and fundamental values and, of course, a democratic and peaceful world.

Today, we celebrate the 20th anniversary of NAFTA.  As time can tell us, this treaty was successful, and it started guaranteeing prosperity from one extreme to the other of the hemisphere.  The volume of exchanges is fourfold now, and is over $30 billion.  And we have now seen exponential growth and can hope for exponential growth in years to go.

We are in agreement to say that we can still grow the success of NAFTA, to implement new ways, for instance, in regard to the Trans-Pacific alliance.  And so these negotiations should be for the best.  We need to create employment.  This is the key to revitalize the economy and to foster prosperity not only for the Canadian populations, but for our populations at large. 

That's why our government will keep on working and expanding the free trade and commerce with our main partners in North America, as well as with Asia Pacific region and worldwide, since we want to have access on the other side of the Atlantic, since we have subscribed to the free exchange agreement with Europe.

Today, President Obama, President Peña Nieto and myself have discussed and have delved into many topics, especially the state of the world economy at a local, regional level, and competiveness -- North American competitiveness.  We are truly enthusiastic to collaborate, with this idea of collaborating together.  We shall keep on working together with my homologues [counterparts] and to take a profit of all the occasions for the well-being of our populations.  And we will host the forthcoming population of the summit in Canada. 

And I would like to add a word in regard to the situation in Ukraine.  There’s been a truce, but it is essential that we take action.  And at the end of the day, the Ukrainian government has to be held responsible for settling this situation.  The Ukrainian government took actions -- actions that were not only unpopular, but actions that put at risk nature and the aspirations of becoming an independent nation.

(In English.)  My sincere thanks to President Peña Nieto and the Mexican people for their generous hospitality.  We’ve had a wonderful time here in beautiful Mexico, and I look forward to returning again soon.

Today we had productive meetings with Canada’s closest friends and trading partners -- partners with whom we share goods, services and information, and also fundamental values and a vision for a democratic and peaceful world.

This year we mark the 20th anniversary of the North American Free Trade Agreement.  And as only time can reveal, the agreement -- statistics alone -- has been overwhelmingly successful and is responsible for creating prosperity from the bottom to the top of the continent.  There has been a fourfold growth in trilateral trade over the last 20 years that now exceeds a trillion dollars. And it is estimated that the NAFTA marketplace will continue to expand exponentially in the decades to come.

We all agree that there is enormous potential to build on the success of NAFTA in new ways, for example, most notably through the Trans-Pacific Partnership.  We’re therefore focused on bringing those negotiations to a successful conclusion.

Developing trade is one of the keys to job creation.  It is a key to economic vitality, and it is a key to long-term prosperity not just for the Canadian people, but for all of our peoples.  That's why our government will continue to work to expand trade with our two core trading partners in North America, in the Asia Pacific region more generally, and around the world  -- just as we did last year, when we expanded our access across the Atlantic through the conclusion of the Canada-European Union Comprehensive Economic and Trade Agreement. 

In our meetings today, Presidents Peña Nieto, Obama and I discussed a range of topics as have already been detailed by my colleagues, including the state of the global economy, international regional security, and North American competitiveness.  We share a genuine enthusiasm for closer collaboration.

The Presidents and I will continue to work together to address the challenges of the 21st century and to seize the many promising opportunities that the future holds for our peoples.  And I do look forward to hosting the next North American Leaders Summit in Canada.

And I’d also just like to conclude with a word on the situation in Ukraine.  We obviously are encouraged to hear the news of a truce.  While this is good news, this kind of news, these kinds of words are only meaningful if they are put into action.  And ultimately, it is the regime that is responsible for resolving the current situation.  It is the regime that created this situation -- not by taking decisions that were merely unpopular, but by undertaking decisions that went against the very nature and aspirations of Ukraine as an independent state.  And for that reason, we hold the government responsible and urge them to take all the steps necessary to resolve the situation and to put Ukraine back on the democratic and Euro-Atlantic path that the Ukrainian people desire.  (Applause.)

MODERATOR:  (As interpreted.)  We will have a round of questions.  Jason McDonald will introduce the Canadian journalist asking the question.

MR. MCDONALD:  Omar Sachedina from CTV News.

Q    Mr. President, good evening to you.  Canada has offered to work with the United States on joint rules to reduce greenhouse gas emissions in the oil and gas sector.  You’ve said the Keystone XL pipeline won’t be approved if it significantly worsens climate change.  The State Department report has concluded that Keystone will not have a significant effect on climate change.  So my question to you is, what more needs to be done on both sides of the border for this project to go ahead?

And, Prime Minister, I’d love for you to be able to weigh on this as well.  Et en français aussi, s'il vous plaît.

THE PRESIDENT:  Well, as I’ve stated previously, there is a process that has been gone through, and I know it’s been extensive, and at times I’m sure Stephen feels a little too laborious.  But these are how we make these decisions about something that could potentially have a significant impact on America’s national economy and our national interests.

So the State Department has gone through its review.  There is now a comment period in which other agencies weigh in.  That will be evaluated by Secretary of State Kerry, and we’ll make a decision at that point.

In the meantime, Stephen and I, during a break after lunch, discussed a shared interest in working together around dealing with greenhouse gas emissions.  And this is something that we have to deal with.  I said previously that how Keystone impacted greenhouse gas emissions would affect our decision, but, frankly, it has to affect all of our decisions at this stage, because the science is irrefutable.  We’re already seeing severe weather patterns increase.  That has consequences for our businesses, for our jobs, for our families, for safety and security.  It has the potential of displacing people in ways that we cannot currently fully anticipate, and will be extraordinarily costly.

So I welcome the work that we can do together with Canada.  One of the wonderful things about North America is we have this amazing bounty of traditional fossil fuels, and we also have extraordinary businesses that are able to extract them in very efficient ways.  And that’s something that we should welcome because it helps to promote economic growth.  But we only have one planet, and so I believe that ultimately we can both promote economic development and growth, recognizing that we’re not going to immediately transition off of fossil fuels, but that we do have to point to the future and show leadership so that other countries who will be the main emitters fairly soon -- China, India, other emerging markets -- so that they can look at what we’re doing and we have leverage over them in terms of them improving their practices as well.

So this will be a joint effort.  I’m very eager to consult with Stephen around those issues.  And Keystone will proceed along the path that’s already been set forth.

PRIME MINISTER HARPER:  Let me just say a couple of things. First of all, obviously, President Obama and I had an exchange on this.  My views in favor of the project are very well known.  His views on the process are also equally well known.  And we had that discussion and will continue on that discussion.

I would just say two things about the process.  First, on the issue of climate change, which is a shared concern, Canada and the United States have similar targets at the international level.  We already cooperate in several sectors in terms of emissions reductions.  But in terms of climate change, I think the State Department report already was pretty definitive on that particular issue.

The other thing I’d just draw attention to, just because I think it’s useful to point out the benefits to Canada, is the reform that we had done of environmental review and assessments of projects in Canada.  As you know, a couple years ago we moved to reform our system so that we have a single review wherever possible -- a single review, a multi-dimensional review that happens over a fixed timeline.  And I think that is a process that is tremendously useful in giving investors greater certainty in terms of the kind of plans they may have in the Canadian economy.

(As interpreted.)  And now I shall repeat my comments in French.  (Speaks in French.)    

MODERATOR:  From the traveling U.S. press, goes to Jim Kuhnhenn of the Associated Press.

Q    Señor Presidente, muchas gracias.  Ha sido un placer.  Prime Minister -- do you worry that longstanding opposition to trade deals in the U.S. from both the President’s party and some Republicans pose a threat to the Trans-Pacific Partnership?  And do you -- in your mind, is it essential that Congress approve it, or at least give the President fast track authority this year, or can it wait until after the U.S. elections in November? 

Mr. President, if you’d like to chime in on that as well -- you mentioned parochial interest today; I’d be interested in how you intend to bring your Democrats along.  But I had a question for you on something else that you raised.

PRESIDENT OBAMA:  How many questions do you got, Jim?

Q    Just one, sir.

PRESIDENT OBAMA:  Okay.  (Laughter.)  Because you know I’ve got to answer that one, too, right?  That was a pretty slick move.  (Laughter.) 

Q    The common denominator in the strife in Ukraine and Syria is the support that those two governments get from Russia, and I’m wondering, sir, if you believe that President Putin bears some responsibility for the intransigence of those two regimes.  And to some degree, has this gone beyond just those two countries, and has it become a tug of war between two world powers?

PRESIDENT OBAMA:  Let me answer very briefly on the trade issue.  It’s not accurate, Jim, to say that my party opposes this trade deal.  There are elements of my party that oppose this trade deal, there are elements of my party that oppose the South Korea free trade agreement, the Colombia free trade agreement and the Panama free trade agreement -- all of which we passed with Democratic votes.

So what I’ve said to President Peña Nieto and Prime Minister Harper is we’ll get this passed if it’s a good agreement.  And the key at this point is to make sure that our countries, which hold ourselves up as champions of free trade, resolve our legitimate national interests in these negotiations so that we can present a united front against a number of the other participants in the TPP negotiations who don’t have as much of a tradition of free trade.  And that is to our advantage, precisely because North America has this amazing competitive advantage, and we are already relatively open markets.

And part of our goal here is to make sure that the Asia Pacific region -- which is growing faster than anyplace else in the world, has a larger population than anyplace else in the world -- that they have a model of trade that is free and fair and open and allows our businesses to compete and allows our workers to make goods and deliver services that those markets are purchasing.  And we can only do that if we raise the bar in terms of what our trade models look like. 

And I’ve said this to some of my own constituents who are opposed to trade:  Those who are concerned about losing jobs or outsourcing need to understand some of the old agreements put us at a disadvantage.  That’s exactly why we’ve got to have stronger agreements that protect our intellectual property, that open up markets to our agricultural products; that make sure that when it comes to government procurement or sovereign wealth funds in these other countries, that they’re not taking advantage of our businesses and preventing us from competing there.  That’s exactly why we’ve got to get this done.  And I’m very appreciative of the shared vision and commitment that Prime Minister Harper and President Enrique Peña Nieto have on this issue.

Now, with respect to Syria and the Ukraine, I do think it is worth noting that you have in this situation one country that has clearly been a client state of Russia, another whose government is currently -- been supported by Russia; where the people obviously have a very different view and vision for their country.  And we’ve now seen a great deal of turmoil there that arose organically from within those countries. 

I don’t think there’s a competition between the United States and Russia.  I think this is an expression of the hopes and aspirations of people inside of Syria and people inside of the Ukraine who recognize that basic freedoms -- freedom of speech, freedom of assembly, fair and free elections, the ability to run a business without paying a bribe, to not be discriminated against because of your religion or your beliefs -- that those are fundamental rights that everybody wants to enjoy.

Now, Mr. Putin has a different view on many of those issues, and I don’t think that there’s any secret on that.  And our approach as the United States is not to see these as some Cold War chessboard in which we’re in competition with Russia.  Our goal is to make sure that the people of Ukraine are able to make decisions for themselves about their future, that the people of Syria are able to make decisions without having bombs going off and killing women and children, or chemical weapons, or towns being starved because a despot wants to cling to power. 

Those express our values and our national interests, and we will continue to express those national interests.  There are times, I hope, where Russia will recognize that over the long term they should be on board with those values and interests as well.  Right now, there are times where we have strong disagreements.  And when I speak to Mr. Putin, I’m very candid about those disagreements, even as we will continue to pursue cooperation with Russia on areas where we had shared concerns. 

But I want to emphasize this:  The situation that happened in Ukraine has to do with whether or not the people of Ukraine can determine their own destiny.  And my government and Vice President Biden, and I personally, have expressed to President Yanukovych the need for him to recognize the spirit of the Ukrainian people and work with that, as opposed to trying to repress it.  And so we’ll continue to stand on the side of the people. 

My hope is, at this point, that a truce may hold, but Stephen is exactly right -- ultimately, the government is responsible for making sure that we shift towards some sort of unity government, even if it’s temporary, that allows us to move to fair and free elections so that the will of the Ukrainian people can be rightly expressed without the kinds of chaos we’ve seen on the streets and without the bloodshed that all of us I think strongly condemn.

PRIME MINISTER HARPER:  On the issue of the Trans-Pacific Partnership, as I said, we are wanting to see and committed to seeing a good, comprehensive Trans-Pacific Partnership trade agreement.  I think it’s in all of our interest for the reasons that have already been laid out.  That said, the government of Canada’s position is always clear in these matters that we will only come to an agreement when we are convinced the agreement is in the best interest of Canada.  And we will stay at the table as long as it takes to get to that particular situation.

And I think we have the track record to prove it.  Our government, the current government of Canada, has signed more trade agreements than all previous Canadian governments combined. What I would say is this -- I’m not going to comment on the process in Congress.  What I would say is this -- the reason I said what I said about working until we get an agreement that is in the interest of Canada is we will have to have an agreement that can be sold to the Canadian Parliament and ultimately to the Canadian people.  And that’s what we’re aiming for.

(The Prime Minister repeats his remarks in French.)

PRESIDENT PEÑA NIETO:  (As interpreted.)  The Mexican stand has been very clear, and specifically our take on the TPP have always stated it, it is of the interest of Mexico.  We have been part of the negotiation rounds to eventually reach an agreement of this important opportunity that the TPP offers.  We can expand the potential of North America into the Asia Pacific region.  Mexico would do its best for the sake of Mexico to be on the side of the solution.  We will overcome disagreements and eventual roadblocks that the negotiation rounds present.  And we hope that it is this spirit that we reach the agreement.

Mexico has made a commitment and has shown political will to be part of the Trans-Pacific Partnership.  We hope that the deal happens.  That is the Mexican stand, and we will work to the best of our ability to reach this goal.

Now, on behalf of Mexico, Miguel Reyes Razo, from the Mexican Editorial Organization, will ask a question.

Q    (As interpreted.)  Good evening, everyone.  By virtue of the fact that we celebrate the 20th anniversary of the efforts made by Mexico, the United States and Canada, we have NAFTA for 20 years.  I would like to ask Enrique Peña Nieto, the President of my country, what is the outlook of the northern part of this continent in terms of development?  And at the same time, Mr. President Peña Nieto, I would like to know, what are the challenges for the development that we have hoped for, that we are expecting? 

And I would like to ask the President of the United States of America, Mr. Obama, and Mr. Harper, the Prime Minister of Canada -- what is the engagement that we should expect from you? What is your actual commitment to make this region, North America, thrive in economical terms?  Now, we have 13 months and a half of your administration, Mr. Enrique Peña Nieto.  And you, Canada and the United States, partners and neighbors of this country, what is your take?  What is your take on this 13 months and a half of the Mexican President?  Thank you very much for your reply.

PRESIDENT PEÑA NIETO:  (As interpreted.)  Mr. Miguel, I believe that we have been very candid in terms of the huge strength that we see in North America after 20 years of the free trade agreement.  Our trade has been able to thrive.  We have more commercial exchanges.  We have more investment in the region. 

And today we have integrated added value chains between our three countries.  That means that we are adding value to products that are offered in this great market.  We are fully aware of the economic growth since, so far, we are fully aware of the creation of jobs in North America.  That is why we have committed in this summit to take on actions that would help us strengthen our economic ties even further.  We have committed to enable trade, to have better infrastructure, to have safer exchanges, and to make our trade be easier.  So these are the agreements that we have made today. 

And we have also acknowledged the enormous potential.  And the future that we see in the horizon would be based on the strengths that we have built upon over the course of the last 20 years.  And let us acknowledge that we are three countries that we are like-minded in terms of our values.  We are three democratic countries.  We are three countries who believe in free trade.  And our countries have found in this instrument a space to create jobs and to have more development in our nations.

PRESIDENT OBAMA:  Well, as we’ve said I think throughout our meetings today, America’s success, Mexico’s success, Canadian success are all bound together.  I think that if you just look at the facts, Mexico has made enormous strides over the last several decades.  And, in part, that is because we’ve seen a greater integration of Mexico in the world economy.  I think the United States and Canada have played constructive roles in that.  Our ability to trade and engage in commerce with Mexico obviously has created jobs and opportunities in our country, as well.  And so it has been a mutually beneficial partnership -- based on self-interest, but also as Enrique said, based on common values.

We’ve seen a consolidation of democracy here in Mexico, and I think the kinds of reforms that Enrique has initiated over the last 13 months are ones that will put Mexico in an even stronger competitive footing in the world economy in the years to come. 

And I recognize there are still implementation issues that will be involved, and there will be a healthy debate here in Mexico, but I’m confident, given the talent of the Mexican people, given the resources of the Mexican people, given the growing capacity of Mexican businesses, and given the fact that we, as a North American entity, constitutes a huge trading bloc and economic powerhouse around the world, that we should anticipate Mexico’s growth to continue, standards of living to continue, jobs and opportunities to continue.  And that's what we hope for all our countries.

I’m confident that the partnership that we’ve developed is good for the United States, creates jobs in the United States, helps businesses in the United States.  And if we continue to cooperate and try to reduce some of the barriers that have in the past slowed down our commercial exchanges, as well as educational exchanges and scientific exchanges, then we’re going to be successful.

PRIME MINISTER HARPER:  (As interpreted.)  Allow me, this is our perspective.  While Canada has seen great success, but the development of Mexico throughout this time period that is 20 years has been unbelievable, socially, economically, politically. And Mexico is becoming a world of power.  And we see this accelerating process with the support of President Peña Nieto. 

You have made comments on the challenges to meet.  I think that the greatest one is the need to keep on increasing the flow of goods and services and information across our borders at a time where risks and threats to security are also increased across the borders.  And that will be the greatest challenge to meet. 

(In English.)  Look, I think the NAFTA relationship, as I’ve said before, has been tremendously successful for all of us. But I think, looking back 20 years, the development of Mexico on all levels -- economic, social, political -- over the period has been incredible.  It’s a process that is accelerating under President Peña Nieto’s very bold vision for the future, and Mexico is increasingly becoming a global economic player.

You asked about challenges.  I think the biggest single challenge is in an era where we are seeing and need to see even greater movement of goods, services, people, investments, information flows across our borders, that at the same time, the risks and the threats to security across those borders continue to rise.  So the big challenge will be how we continue to grow that human and trade flow, while at the same time minimizing the risks.

MODERATOR:  (As interpreted) President Peña Nieto, would you like to take the floor so you can officially close this meeting?

PRESIDENT PEÑA NIETO:  (As interpreted.)  Yes, I will.  Thank you very much. 

Once again, I would like to congratulate myself for this summit.  We have built a climate that is based on trust, respect, and we have worked towards a relationship that it’s very clear in terms of the responsibilities of each one of the heads of state. And I am certain that this relationship will result in a greater integration, a stronger friendship, and whatever we do for the sake of North America will benefit our peoples.

I would like to bear testimony of how grateful I am towards the authorities of the state, the Governor of the State of Mexico, Eruviel Ávila.  I’d like to thank you for enabling the summit to take place here.  I would like to thank the Chief Justice of the State of Mexico.  They provided us with their facilities. 

And I would like to thank the inhabitants of the capital city of the State of Mexico, Toluca, for their hospitality.  I thank them.  And I’d like to thank all of them for the inconveniences and all the preparation work and all the security operations needed for the summit.  I’m very grateful towards them.  And I’m very grateful for the hospitality given to the President of the United States, Barack Obama; and the Prime Minister of Canada, Stephen Harper.

Thank you very much and have a safe trip home.  Thank you very much.  (Applause.)

END
8:20 P.M. CST

The White House

Office of the Press Secretary

For Immediate Release
February 19, 2014

FACT SHEET: Key Deliverables for the 2014 North American Leaders Summit

Today President Obama met in Toluca, Mexico, with President Peña Nieto of Mexico and Prime Minister Stephen Harper of Canada for the North American Leaders Summit.  They discussed their vision for a prosperous and secure future for the citizens of all three countries and their shared commitment to work together to realize that vision.   They announced concrete initiatives by the three countries aimed at enhancing our competitiveness in the global economy, expanding opportunities for our citizens, and promoting peace, security, and development through multilateral action.  Some of these initiatives include:

INCLUSIVE AND SHARED PROSPERITY

  • Creating a North American Trusted Traveler Program, allowing vetted individuals to travel more easily between our three countries.
  • Harmonizing trade data, consistent with international standards, to make it easier for companies to do business in our three countries.
  • Joint Investment and Tourism Cooperation including exchanging best practices. 
  • Creating a North American Transportation Plan, starting with freight planning.
  • Exchanging information on our strong bilateral border initiatives.
  • Strengthening trilateral regulatory cooperation in order to ease burdens on business.

INNOVATION/EDUCATION

  • Creating a Trilateral Research, Development and Innovation Council, encouraging opportunities for North American leadership and a trilateral network of entrepreneurs, as well as economic development efforts in highly integrated regions, like the Pacific Northwest Economic Region and the CaliBaja mega region.
  • Increasing educational exchanges and promoting skills for a 21st century workforce.
  • Promoting trilateral cooperation on women’s empowerment and entrepreneurship.

ENERGY/CLIMATE CHANGE

  • Holding a North American Energy Ministers Meeting in 2014 in order to define areas for strong trilateral cooperation on energy.
  • Supporting efforts to reinvigorate the Commission for Environmental Cooperation.
  • Continue trilateral work under the Montreal Protocol to phase down HFC production and consumption.
  • Continuing trilateral coordination in the Climate and Clean Air Coalition.
  • Declaring North American adherence to high standards in fuel quality, emissions standards, and fuel efficiency for heavy-duty vehicles.

CITIZEN SECURITY

  • Trilateral Coordination on emergency management communications.
  • Broadening the North American Plan for Animal and Pandemic Influenza to include other health security threats; leverage this collaboration as a model to strengthen global health security.
  • Increasing trilateral cooperation to combat importation of counterfeit products.
  • Fighting trafficking in persons, including through a trilateral technical-level exchange.

REGIONAL, GLOBAL AND STAKEHOLDER OUTREACH

  • Providing North American support for a Disaster Risk Insurance Initiative for Central America to enhance the ability of the region to respond swiftly to natural disasters.
  • Increasing North American cooperation on energy in Central America and the Caribbean.
  • Creating an outreach mechanism to increase stakeholder input, including from civil society.

The White House

Office of the Press Secretary

For Immediate Release
February 19, 2014

Joint Statement by North American Leaders - 21st Century North America: Building the Most Competitive and Dynamic Region in the World

Following is the text of a Joint Statement by North American Leaders:

21st Century North America: Building the Most Competitive and Dynamic Region in the World

We, the Leaders of North America, met today in Toluca, Mexico, to recognize the strength of our relationship and open a new chapter in our partnership. We are determined to promote inclusive broad-based economic growth for the wellbeing of our citizens, so that 21st century North America sets new global standards for trade, education, sustainable growth, and innovation. Our region is among the most competitive and dynamic in the world. We have a shared vision for its future, and a strong political, legal, and institutional framework to build upon.

Our countries are established democracies and share values and aspirations. Countless contacts among our societies bring us together. We generate close to 30 percent of global goods and services. Our trade is at least 265 percent larger than twenty years ago, when the North American Free Trade Agreement came into force, and is now worth more than one trillion dollars per year, while investment within the region has been multiplied by six. Our three economies benefit from each other’s stability and complementarities, and a shared commitment to creating good jobs and opportunities for all of our citizens. Private investment is increasingly directed towards North America, in recognition of the competitive advantage of our integrated production and supply chains, and our highly skilled workforce.

Shared and inclusive prosperity

Our engagement as a region with the rest of the world has a direct impact on the competitiveness of our economies and the prosperity of our societies. We will continue to work closely on matters related to international trade, so that our integrated supply chains are deepened and strengthened. We will jointly promote trade and investment in those sectors in which the integration of our production chains serves as a distinct global advantage, and work together to highlight those advantages.

Our governments are committed to developing a North American Competitiveness work plan, focused on investment, innovation and increased private sector engagement. We seek to set new standards for global trade through the prompt conclusion of a high standard, ambitious, and comprehensive Trans-Pacific Partnership, as we promote further trade liberalization in the Asia-Pacific region.

We will develop a North American Transportation Plan, beginning with a regional freight plan and building on existing initiatives. We will also streamline procedures and harmonize customs data requirements for traders and visitors. We will facilitate the movement of people through the establishment in 2014 of a North American Trusted Traveler Program, starting with the mutual recognition of the NEXUS, Global Entry, SENTRI and Viajero Confiable programs.

Our governments will leverage the existing bilateral border mechanisms to enhance the secure movement of goods across North America, and promote trilateral exchanges on logistics corridors and regional development. Our governments will designate observers to attend meetings of the border management executive committees already in place. This approach will also be followed within the existing bilateral processes on regulatory cooperation. We will continue to protect and enforce intellectual property rights.

New areas of opportunity

The future success and competitiveness of our region depends on our ability to foster innovation, provide our citizens access to high quality educational opportunities and to technology, and promote a workforce with the skills necessary for success in the 21st century global economy. To help guide these efforts, our governments will engage stakeholders and academics to better assess and plan for the needs of North America’s future workforce. We will promote joint research in national laboratories and universities, building connections between North American businesses, particularly entrepreneurs, and technology accelerators. We will first focus on entrepreneurship and innovation exchanges, and actions to advance the economic empowerment of women. Authorities responsible for these efforts will meet in an informal working group to seek greater coordination and collaboration among them.

Academic exchange and educational mobility have long contributed to the mutual understanding of our societies and of the promise of North America. We commit to increase the number of student exchanges from within the region in our respective higher education systems, in line with the United States’ 100,000 Strong in the Americas Initiative, Mexico’s Proyecta 100,000, and Canada’s International Education Strategy. We will explore opportunities for further cooperation in this area.

Energy is a trilateral priority. Developing and securing affordable, clean and reliable energy supplies can drive economic growth and support sustainable development, as we shift towards a low carbon energy future. To build on recent progress in this area, our Energy Ministers will meet later in 2014 to discuss opportunities to promote common strategies on energy efficiency, infrastructure, innovation, renewable energy, unconventional energy sources, energy trade, and responsible resource development, including the development of relevant technical studies.

Our countries will continue to work together to address climate change in pursuit of an ambitious and inclusive global agreement within the U.N. Framework Convention on Climate Change, while also collaborating through complementary mechanisms like the Major Economies Forum, the Climate and Clean Air Coalition, and the Energy and Climate Partnership of the Americas. In addition, we will intensify our efforts to promote an amendment to the Montreal Protocol to phase-down production and consumption of climate-damaging hydrofluorocarbons (HFCs).

We will continue to collaborate in the protection of our region’s biodiversity and to address other environmental challenges, such as wildlife trafficking and ecosystems at risk. Our governments will establish a working group to ensure the conservation of the Monarch butterfly, a species that symbolizes our association.

Citizen security and global issues

We reaffirm our commitment to the principles of shared responsibility, mutual trust, and respect, in support of our domestic priorities, as we face together the challenges posed by transnational organized crime and other threats to the security of our citizens. As increasingly integrated neighbors, we recognize the need to collaborate effectively to counter global threats, such as international terrorism, and to protect our shared critical infrastructure.

The effective exchange of information and coordination among law-enforcement authorities will remain essential. We will continue to coordinate and pursue new areas of cooperation to counter drug trafficking, arms trafficking and other illicit trade, consistent with our laws and constitutions. To more effectively counter money laundering and illicit financial flows while ensuring the efficient interconnection of our systems, our authorities will enhance their dialogue on financial sector regulation and supervision. Our governments share a commitment to combating human trafficking in all its forms and will work toward improving services for the victims of this crime.

To strengthen regional security, we will continue to cooperate with our partners in Central America and the Caribbean, and with other countries in the hemisphere to promote development, economic growth and citizen security. We will provide capacity building support, and seek closer collaboration on financial inclusion and social safety nets, among other areas. We will broaden the scope of our efforts by including actions on disaster risk prevention and insurance, wildfire management, and access to affordable and clean energy, and will promote sustainable social development.

North America’s response to the H1N1 pandemic in 2009 remains an example of timely and effective cooperation. We will build upon the North American Plan for Animal and Pandemic Influenza (NAPAPI) to strengthen our preparedness and response to future public health events.

North America will continue to develop collective solutions to global challenges. Our three countries will increase our already robust cooperation across the United Nations and other multilateral bodies. We will engage in the definition of the post-2015 development agenda with an inclusive approach that addresses inequalities and seeks to ensure that global objectives are pursued according to national standards of accountability. We support the Open Government Partnership, and we are committed to transparency and open government across the world. We will also continue to promote democracy, human rights and the respect of international law throughout the world and in the Americas, consistent with the values enumerated in the Inter American Democratic Charter.

Delivering on our agenda

The success of this vision will hinge on its follow up. Our governments will carry out periodic consultations on the implementation of our agreements, reporting to leaders on the progress of our efforts before each upcoming North American Leaders’ Summit. Our countries will also develop a new outreach mechanism in 2014, through which experts and stakeholders will be able to share their perspectives on our agenda and propose new lines of action.

The collaboration between our governments, civil societies, academics, entrepreneurs, and other actors, has a direct and positive impact in the lives and wellbeing of our peoples. The future of North America is even more brilliant than its past and together we can make it the most competitive and dynamic region in the world.

President Obama and President Peña Nieto welcome Prime Minister Harper’s offer for Canada to host the next North American Leaders’ Summit in 2015.

Toluca, Mexico, February 19, 2014

The White House

Office of the Press Secretary

For Immediate Release
February 19, 2014

Statement by the President

In my State of the Union Address, I asked more businesses to do what they can to raise their employees’ wages.  Today, I applaud Gap, Inc. for announcing that they intend to raise wages for their employees beginning this year – a decision that will benefit about 65,000 workers in the U.S.  As a chief executive, I’ve required federal contractors to pay their employees a wage of at least $10.10 an hour, and more states are taking steps to raise their minimum wage as well.  But only action from Congress can make a difference nationwide.  Right now, there is a bill in front of both the House and the Senate that would boost America’s minimum wage to $10.10 an hour, and lift wages for more than 16 million workers – all without requiring a single dollar in new taxes or spending.  It’s time to pass that bill and give America a raise. 

###

The White House

Office of the Press Secretary

For Immediate Release
February 19, 2014

Readout of President Obama’s Call with Prime Minister Erdogan

President Obama spoke by phone today with Prime Minister Erdogan of Turkey on a range of bilateral and regional issues.  The President affirmed the value he places on a strong, mutually respectful bilateral relationship with the Republic of Turkey and expressed his view that Turkey can demonstrate leadership in the world through positive engagement.  The President and Prime Minister agreed on the importance of close cooperation between our two countries to address the growing terrorist presence in Syria and on the shared interest in continuing efforts to advance a political solution to the Syria conflict.  The President and Prime Minister discussed the importance of encouraging Baghdad and Erbil to find common ground on energy issues and supporting the agreement they achieve.  The President thanked the Prime Minister for his constructive role in the effort on Cyprus to renew negotiations for a settlement.  The Prime Minister noted the launch ceremony for the Boeing 737 Peace Eagle on Friday. The President and Prime Minister spoke about the importance of quickly concluding the normalization agreement with Israel.  The leaders also discussed the need for strong, sustainable, and balanced growth in the global economy, and the President noted the importance of sound policies rooted in the rule of law to reassure the financial markets, nurture a predictable investment environment, strengthen bilateral ties, and benefit the future of Turkey.

The White House

Office of the Press Secretary

For Immediate Release
February 19, 2014

FACT SHEET: President Obama to Sign Executive Order on Streamlining the Export/Import Process for America’s Businesses

In his State of the Union address, President Obama set an ambitious agenda to make 2014 a year of action: using his pen and his phone to take steps that expand opportunity for America’s middle class – including helping small American businesses compete in a global economy.  Today, aboard Air Force One, the President will sign a new Executive Order on Streamlining the Export/Import Process for America’s Businesses.

Specifically, the Executive Order cuts processing and approval times from days to minutes for small businesses that export American-made goods and services by completing the International Trade Data System (ITDS) by December 2016.  Today, businesses must submit information to dozens of government agencies, often on paper forms, sometimes waiting on process for days to move goods across the border.  The ITDS will allow businesses to electronically transmit, through a “single-window,” the data required by the U.S. Government to import or export cargo.  This new electronic system will speed up the shipment of American-made goods overseas, eliminate often duplicative and burdensome paperwork, and make our government more efficient. 

This Executive Order is especially important to small and medium companies that depend on global trade.  Once fully implemented, the ITDS will dramatically reduce the time and expense for businesses to move the more than 50 million containers and $3.8 trillion worth of goods that cross our borders each year.

Development of a “Single-Window”

The Executive Order mandates the completion of the International Trade Data System (ITDS) by December 2016.  The ITDS creates capabilities that will allow businesses to transmit, through an electronic “single-window,” the data required by the U.S. Government to import or export cargo.

At present, businesses must submit data to multiple agencies through various channels, often in paper form.  The ITDS will save businesses time and money, and dramatically reduce the number of forms a business has to fill out to import or export.

The ITDS will allow more efficient government decision-making associated with goods arriving at the border, reducing the time for clearing goods from many days to, in some cases, seconds.  This will dramatically speed the flow of legitimate commerce across our borders.

Coordinated and automated messaging about these decisions will increase predictability for the private sector and allow them to plan supply chain movements with greater confidence and less cost.

Though the development of the ITDS has been underway for some time, the Order establishes a deadline for completion, requires relevant agencies to transition from paper-based to electronic data collection, and calls for enhanced transparency by requiring public posting of implementation plans and schedules.

Creation of More Efficient Business Processes through Partnership

The new Executive Order also charges the government to partner with non-government stakeholders to build more efficient business processes and improve border management policies.

A newly expanded group, the Border Interagency Executive Council (BIEC) will be responsible for improving coordination among the dozens of agencies with import and export requirements and with outside stakeholders.  The BIEC is charged with cutting red tape and reducing supply chain inefficiencies, while managing the risks presented by goods flowing in and out of the United States.

The ITDS Board of Directors will continue to oversee the development of the ITDS automated capabilities.

The White House

Office of the Press Secretary

For Immediate Release
February 18, 2014

Statement from the President on the Retirement of Congresswoman Gloria Negrete McLeod

Gloria Negrete McLeod has been a strong advocate for hardworking families and farmers in California’s 35th district and across the country.  She has been a key partner in promoting access to affordable health care and bringing quality employment and higher education opportunities to all Americans.  Gloria has consistently supported working women and their families and has championed programs to help our nation’s veterans find jobs and enroll in college. Michelle and I thank Congresswoman Negrete McLeod for her service and send her, her husband Gilbert, and their family our warmest regards.

The White House

Office of the Press Secretary

For Immediate Release
February 18, 2014

On-the-Record Call by Jason Furman and Betsey Stevenson on the CBO Report on Minimum Wage

ON-THE-RECORD CONFERENCE CALL
COUNCIL OF ECONOMIC ADVISERS CHAIRMAN JASON FURMAN
AND CEA MEMBER BETSEY STEVENSON
ON THE CBO REPORT ON MINIMUM WAGE

Via Telephone

3:56 P.M. EST

MR. LEHRICH:  Hey, everybody.  Thanks for joining us.  It’s Matt Lehrich from the White House Press Office.  I know all of you are interested in our reaction to the CBO report today on minimum wage.  And so I’m here with Jason Furman and Betsey Stevenson from the Council of Economic Advisers here at the White House.

And with that, I will turn it over to Jason.

MR. FURMAN:  Thank you so much.  I think you have all probably seen our blog post on the new CBO report.  But just to quickly recap on some of the points we make, the new CBO report finds that 16.5 million workers would get a raise from increasing the minimum wage to $10.10 per hour.  It would help millions of hardworking families reduce poverty and increase overall wages going to lower-income and moderate-income households.

In all of that analysis, the CBO is essentially confirming the consensus view:  the consensus on the magnitude of workers helped; the consensus on the impact on poverty; I think very important, the consensus that, overall, wages and earnings would go up for low-moderate and middle-income households, even taking into account CBO’s estimates of employment; and then the overall consensus on issues like only a small minority of beneficiaries are teenagers.

On the issue of employment, CBO’s central estimate is that raising the minimum wage to $10.10 per hour would lead to a 0.3 percent decrease in employment.  And CBO acknowledges that the employment impact could be essentially zero.  But even those estimates do not reflect the overall consensus view of economists who have said that the minimum wage would have little or no impact on employment.  And in our blog post we cite a wide range of evidence to that respect, including drawing on 64 different empirical studies of the minimum wage and the impact that it has on employment. 

And if you take all of that as a whole, what that research basically finds is that raising the minimum wage increases motivation.  It reduces some of the distractions that impact productivity that are related to poverty.  It reduces absenteeism.  It increases retention for workers on the job, and reduces turnover.  And that when you take all of that into account, the overall benefits for productivity, plus the other margins on which firms can adjust -- for example, reduced profits -- mean that there is substantial literature that has found little or no employment impact on the minimum wage.  And, in fact, a number of the leading studies from 1994 through the present published in peer review journals have in fact found precisely that, which is no impact on employment.

So, in summary, overall the report very much does make the case for a policy that benefits more than 16.5 million workers, reduces poverty, raises incomes.  In doing that, it confirms a consensus -- it goes outside the consensus view of economists when it comes to the impact of the minimum wage on employment.

Q    What’s your view on how high the minimum wage would have to go before the employment effects would be significant?  I mean, I assume the White House picked $10.10 for some reason.  Why not go higher if the effects are negligible at $10.10?

MR. FURMAN:  Sure.  Josh, the research we have on the minimum wage is within the range of the types of minimum wages we’ve seen at the federal, state and local level over the past couple of decades; $10.10 is well within that range.  In fact, it would still be below the peak value of the minimum wage in the late 1960s.  It would be below the real value of the minimum wage you’ve seen in some other cases.  So for that reason we’re comfortable that that value is within the range that had been considered by the economic studies that we’re drawing on, in terms of its impact on employment.

Q    Republicans obviously have already jumped on this report.  Are you concerned that these numbers, even spun like you’re spinning them, will make it harder to pass an increase?

MR. FURMAN:  Look, I think -- I’ve seen an awful lot of tweets from Democrats as well pointing out how many workers are helped, the reductions in poverty, the increases in income and all the other incredibly positive things this report finds.  And even this report finds that the very large majority of the workers that it discusses here are benefitting.  And I think that explains why this has overall been a very popular issue for the public.  And I don’t think this report changes those facts or will change the public perception.

But as an economist, there have been a lot of studies of the minimum wage.  We’ve had a chance to review those studies. This is not a piece of original research into the impact of the minimum wage on employment, and I think a lot of economists who have looked at that literature would summarize it differently than CBO has summarized it here.

Q    I just wanted to ask you about something you said earlier.  You said that the CBO report, the findings do not reflect the overall consensus view of economists.  This is something similar to what you said in the briefing room about the other recent CBO report, the 10-year outlook.  Can you talk about why the CEA is coming out and directly refuting something that the CBO -- why are you criticizing the CBO’s report in this way?

MR. FURMAN:  When I went to the briefing room on the CBO report, on the employment impact of the Affordable Care Act, the principal argument that I made in that briefing room was that the CBO analysis was not about businesses cutting jobs, it was about choices by workers.  I also pointed out there were other factors that CBO hadn’t factored in.  But the main argument -- I would say most of what I was pointing out was precisely that. 

The next day or the day after, CBO came out with a blog post that said exactly what I had been saying, which is this was not about businesses killing jobs, it was about a labor supply effect.  And CBO Director, Doug Elmendorf, both in testimony to his blog, said that in a lot of cases that choice would be, for example, someone nearing retirement that might choose to retire now in a way that they couldn’t before, and that would benefit them and their family. 

So there, the main issue was the report was being misinterpreted, and the interpretation I put forward was completely consistent with the interpretation that Doug Elmendorf put forward.

In terms of today’s, sometimes you have to have respectful disagreement between economists.  When it comes to a budget estimate, usually the only estimate you have is CBO.  And they have all of the expertise on that topic, and that's why we take those budget estimates very seriously.

We take this seriously too, but there are also dozens and dozens of other studies on the minimum wage that we can draw on and infer from.  And an economist like Larry Katz, who is one of the leading labor economist experts in the country at Harvard University, is the type of person and authority on the issue of the minimum wage that I would generally look to and draw on.

So I don't think this is the Council of Economic Advisers versus CBO.  I think the last one was all about a misinterpretation where CBO agreed with us.  Today there is some difference of opinion about how to read the literature on the employment effect of the minimum wage.  But that's a difference of opinion that I think a lot of economists would have as well.

Q    Hey, Jason.  This is RealClearPolitics.  We’re all down here in the basement.  I have a quick question for you.  Would it have been more advisable for CBO’s report to outline in greater depth the ambiguities in the numbers, which is what CBO did in 2006 under Mr. Marron?  Or is there sufficient information here in terms of how CBO, without doing original research, came to the conclusions?

MR. FURMAN:  I don't want to edit someone else’s report -- and I can't say the report did.  This is important -- it did say that 0.3 percent decrease in employment, and that there was a range where that range included essentially no impact on employment and that there were possibilities of estimates beyond that, which presumably would be a small increase in employment.

So their report does convey the possibility that there would be no impact on employment.  Their report also does confirm that the greater purchasing power of low-income workers would in the short run boost the economy, which is another effect they have there.  But I don't think the way the headline number is being presented reflects the consensus view of economists on this topic.

Q    Hey, Jason.  Thanks for doing this.  Two questions.  One, can you explain how it is that -- or the basis for accepting some of CBO’s conclusions -- it seems like the ones that support your position -- but not accepting the conclusions that don't support your position when they're based on the same economic assumptions in the same report?  And also, what are you doing at this point to promote minimum wage passage in Congress?

MR. FURMAN:  On your first, we put out our own report -- CEA did last week -- and some of the things here are consistent with that and consistent with other research.  For example, does raising the minimum wage reduce poverty?  There have been a number of studies that have addressed that question and almost all of them have come to the answer yes.  In that case, CBO is restating a consensus.  When it comes to employment, I think they are not restating what I would understand the consensus to be, and that’s where I think there is some respectful disagreement on the emphasis and the certainty around that magnitude of employment loss. 

Could you repeat your second question?

Q    Yes, absolutely.  Just what are you doing to promote or push for minimum wage passage in Congress?  I’m in the Capitol right now and there is certainly -- there’s a lot of debate over how hard the administration and Democrats are --

MR. FURMAN:  I mean, the President has -- there are others that could speak to that better than I could, but it certainly was something he emphasized in the State of the Union.  He emphasized again when he recently signed the EO raising the pay of federal -- people that work for federal contractors.  The Council of Economic Advisers put out a report last week, and it’s something you’ll continue to see the President and the administration more broadly pushing on.

Q    Jason, I want to be clear -- are you saying is your argument that what is flawed about CBO’s conclusion on employment has to do with their failure to take into account the adjustments that you cite in the last paragraph of the statement that you and Betsey Stevenson put out -- namely lower turnover, lower absenteeism?

MS. STEVENSON:  So, this is Betsey.  I think that that’s exactly right.  While they’re not completely clear in the report how they’re thinking about that, I suspect that they are not fully appreciating how much the literature has moved in terms of understanding the cost savings that you get from reduced turnover when you raise the wages for lower-wage workers, from reduced absenteeism and from increased productivity. 

So I think one of the conceptually harder things to appreciate is that there are important spillover effects.  So if the lower-wage workers become more productive, are less likely to quit, have lower absenteeism, that not only means that you’re getting more productivity out of them, but to the extent that they influence the productivity of their coworkers you can overall see greater productivity.

And I think that that understanding in the literature is one of the things that has moved the profession towards believing that the employment effects are zero, and I think that CBO didn’t fully appreciate that in their review. 

Q    And just if I could follow up, is that the White House view that if you had to put a number on the employment effects, it would be zero rather than the number that CBO comes up with?

MR. FURMAN:  Our view is that -- and this is Jason again -- that zero is a perfectly reasonable estimate of the impact of the minimum wage on employment based on research that began with David Card and Alan Krueger comparing minimum wage increase in New Jersey to fast food restaurants across the border in Pennsylvania that didn’t have them, to more recent research that’s taken basically the same method but applied it to hundreds of contiguous county pairs where one of them raised the minimum wage, one of them didn’t.  You compare the employment in one county as compared to the other.

This is something economists have spent a long time studying, there’s a lot of papers on, and most of those papers are very close to zero.  Some papers are negative.  There’s probably some papers that have found -- people have gone out and run a regression and found a big increase in employment, decided that that probably isn’t true, correctly decided that and didn’t publish the paper.  I think that doesn’t happen on the other side.  If you find a large negative effect, those papers tend to be published, so there’s also some publication bias here.  But when you look at some of the highest quality studies in all of it, I think it’s completely reasonable to think it would have zero impact on employment.

Q    Jason, so the CBO report also looked at the effects of a $9 minimum wage, which of course is what President Obama first proposed a year ago.  And it was only I think just a few months ago that he got on board with the Harkin-Miller plan of $10.10.  So then the report, as you expected, the effects -- the positive and negative -- were more muted with the $9 one, but I think the effects on employment were somewhere on the order of like a fifth of the $10.10 proposal.  And so I’m wondering if you feel like this would have been a much easier sell at $9, politically, and how secure you are in feeling that $10.10 is the right number here.

MR. FURMAN:  I guess I’d say substantively it was one type of proposal that benefitted a wide swath of workers.  This benefits 16.5 million directly below $10.10, and then CBO says that as many as 8 million who are just above that line would benefit.  That’s substantially more than at $9 an hour.  If you look at the poverty line for a family of four with one full-time worker who is working full-time, $10.10 takes that family -- if they’re working full-time -- at the minimum wage from below the poverty line to above the poverty line.  And, as I said, we don’t accept the conclusion in this report that this reflects consensus of economists, and that zero employment within the range of $10.10, $9 -- any of those numbers -- would be a perfectly reasonable estimate of the employment impact.

Q    I’m wondering, you’ve obviously been looking at this issue for a long time and I’m curious at what you’ve learned from studying minimum wage increases that have been enacted in the past and how that impacts your point of view for increasing the minimum wage now to $10.10.

MS. STEVENSON:  This is Betsey.  And Jason passed this to me because he sort of already stated this, so I’ll give you a second opinion.  I’ve been also looking at minimum wage studies since my very first days in graduate school, and I really do believe that both the profession and the literature has moved towards thinking over the last couple of decades towards thinking the employment effects are small. 

I think early on in the literature, people were really focused on this idea that sort of comes from that intro Ec class that many of you may have taken, which is that you assume that productivity doesn’t change or can’t be influenced by the rate of pay.  And as I stated earlier, a new burgeoning literature has really pointed out that how much you pay people actually affects how they perform, what they do, and how much they produce.  Once you have that relationship between pay and productivity, it changes the standard model in a way that means that you don’t get the loss of employment that that supply and demand X that you saw on the chalkboard, if you took introductory economics, would have demonstrated.

And that, plus the empirical estimate -- so a better understanding of the theory, the complexity of the theory, and hundreds of empirical estimates of the actual effect has really shifted at least how I view the employment effects of the minimum wage.  And I think that I am really sort of in the middle of the distribution and the profession in terms of thinking about how the minimum wage affects employment.

MR. FURMAN:  And then, just one thing to add is also people have looked across states or across counties that have changed it.  And in addition to finding unemployment, as Betsey said, they’ve also found -- confirmed the more obvious things, which is that it raises incomes -- raising the minimum wage raises incomes and reduces poverty.

MR. LEHRICH:  Thank you to Jason and Betsey, and to all of you for joining us today.  As always, if you have follow-up questions or didn’t get your question in, don’t hesitate to check in with us.  Otherwise, we’ll talk to you all next time.  Thanks. 

END
4:19 P.M. EST

The White House

Office of the Vice President

For Immediate Release
February 18, 2014

Readout of Vice President Biden's Call with Ukrainian President Viktor Yanukovych

Vice President Biden called Ukrainian President Viktor Yanukovych today to express grave concern regarding the crisis on the streets of Kyiv.  He called on President Yanukovych to pull back government forces and to exercise maximum restraint. The Vice President made clear that the United States condemns violence by any side, but that the government bears special responsibility to de-escalate the situation. The Vice President further underscored the urgency of immediate dialogue with opposition leaders to address protesters’ legitimate grievances and to put forward serious proposals for political reform.  The United States is committed to supporting efforts to promote a peaceful resolution to the crisis that reflects the will and aspirations of the Ukrainian people. 

The White House

Office of the Press Secretary

For Immediate Release
February 18, 2014

Statement from the President on the Retirement of Congressman Rush Holt

Over his 15 years in Congress, Rush Holt combined a relentless focus on building a brighter future with an unwavering commitment to improving the everyday lives of the New Jerseyans he represents, especially the veterans he works tirelessly to support.   Just the second research physicist elected to Congress, no one has worked harder to keep America on the cutting edge of innovation than Rush.  Time and time again, he has led efforts to fund science education and basic research.  His legacy will live on in our labs, our universities, and our classrooms, where countless math and science teachers have been able to afford college thanks in part to the TEACH grants he helped create.  Michelle and I thank Congressman Holt for his leadership and service, and we wish him, his wife Margaret, and their children and grandchildren the very best in the future.