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The White House

Briefing by White House Press Secretary Robert Gibbs, 3/20/2009


Office of the Press Secretary
For Immediate Release                              March 20, 2009


James S. Brady Press Briefing Room

2:24 P.M. EDT

MR. GIBBS:  Let me start out giving you a little bit of the sense of the week ahead and an announcement on some commencements that the President has accepted for May.

The President will travel to Camp David tomorrow morning and return to Washington mid-morning on Monday.  When he returns he'll have an event here at the White House to discuss innovation, clean energy and his budget.

A couple of events on Tuesday.  The President will meet with Australian Prime Minister Rudd during the day.  And as you all know, later that evening we'll have a news conference in the East Room.

Q    Do you have a time on that?

MR. GIBBS:  Eight p.m., eastern time.

On Wednesday the President will have events at the -- have an event at the White House, as well as deliver remarks to the Senate Democratic Caucus in the afternoon.

Q    He's going there?

MR. GIBBS:  Yes, I believe that -- yes, that's correct.

In the evening he will attend a fundraiser on behalf of the Democratic National Committee.

On Thursday the President will --

Q    Is that open?

MR. GIBBS:  I believe we'll have pool coverage.

On Thursday the President will attend meetings here and have an event at the White House.  And the same for Friday, before traveling to Camp David next Friday evening.  Obviously the focus -- a lot of the focus next week will be the run-up to the budget.

In terms of commencements, on May 13th the President will give the commencement address at Arizona State University.  On May 17th the President will give the commencement address at Notre Dame.  And on May 22nd he will speak to graduates of the U.S. Naval Academy.

All right, let me get slightly more organized.  Yes, ma'am.

Q    Robert, the new CBO numbers out today indicate that the deficit will be much larger than expected and that the White House had anticipated, and that over the course of time it would be 4 to 5 percent of GDP.  So at this point is 4 to 5 percent sustainable?  And does this give the White House an inclination to consider raising taxes or scaling back the agenda?

MR. GIBBS:  Well, the premise by which the President constructed the budget sent to Capitol Hill was, as I've said repeatedly from here, to cut in half the inherited budget deficit over the course of his first term and to make critical investments in health care, energy independence and education reform in order to make critical investments in our long-term economic growth.

None of the numbers today change the President's either objectives or his ability to achieve that deficit reduction.  The main change in the outlook from CBO is a change or a difference in what they see in terms of long-term economic growth largely in the out years of the budget.  The Fed sees in that long-term outlook between 2.5 and 2.7 percent economic growth.  The Blue Chip forecast is 2.6 percent.  And the government's forecast is 2.6 percent.

I believe the average -- I don't have the number in front of me -- the average for CBO is lower, which is why the out year numbers are different; obviously, as you get farther out the numbers change.  But it doesn't change what the President's focus is in terms of his objectives and making critical investments and doesn't change his ability to halve the deficit in four years.

Q    But I go back, is 4 to 5 percent of GDP sustainable?

MR. GIBBS:  Well, you know, I think the President's budget presents a number that is less than that.  Again, there's -- and you all have covered this over the years, the pretty large difference on occasion between CBO and OMB.  I believe that just in looking at the growth numbers in the GDP you have basically a plus or minus $900 billion swing because the numbers at CBO represent about a 50 percent -- there's a 50 percent likelihood that they'll be different, up or down.

So they don't change the President's long-term objectives.  And most importantly, the President has outlined a plan to bring fiscal responsibility and fiscal sustainability to a town that hasn't seen it for quite some time.  The President looks forward to working with members of Congress throughout the next few weeks to get that budget passed in a timely way, make those critical investments and put ourselves on that fiscal responsibility path that will cut the deficit in half in four years.

Yes, ma'am.

Q    Robert, the President has made the latest in a series of public overtures toward Iran, and I would guess that a lot of thought went into the timing and the format for how he did this.  And I'm just wondering if you could maybe go into why it was decided to do it in this way, at this particular time.  And do you expect this effort to show results anytime soon?

MR. GIBBS:  Well, let me -- obviously the message is -- follows the Persian New Year.  The President believed that the New Year marks -- marked a good time for us to demonstrate the tone for the type of respectful engagement that we believe can be had with the people of Iran.  And we also believe it gives Iran the opportunity for a similar new beginning.  Again -- quote the President's message:  as a way of reaching out to the people, but understanding that there are rights and responsibilities.

In terms of reaction or what we hope to get out of it, I think in many ways that's up to Iran.

Q    So there's an offer on the table for Iran to attend the conference at the end of the month on Afghanistan.  Is it the President's hope that in making this gesture, that that will encourage them to attend that conference?  And is the timing in any way taking that into consideration?

MR. GIBBS:  No, I think the invitation -- that went out previously -- we hope is accepted because the conference is intended to -- the conference is intended to bring about Afghanistan's neighbors in that troubled region of the world.  And obviously Iran is one of those neighbors and we believe, if it wants to, can work constructively with the international community to help the country of Afghanistan.

But again, I think it's important that the President wanted to deliver this unique message directly to the people and to the leaders, to understand that there's a rightful place in the community of nations with -- that there's a rightful place in that community without terror or arms or violence, and that through peaceful actions the two countries can work together toward their mutual ends.


Q    Doesn't the fact that the CBO projects an additional $2.3 trillion long-term deficit negate the fact that the President is talking about being able to cut $2 trillion?  I mean, it's basically, there it went and now here's another $300 billion.

MR. GIBBS:  I have not seen the final report -- and I know Director Orszag will have a call, not long after this and he'll have a better sense of some of the numbers in terms of the savings.  But I think, again, the numbers that you're talking about in many ways accumulate, again, farther down the road based on a change in their assumption about long-term economic growth.

But the President remains confident that he has put forward a budget that meets the critical investments that he thinks America must be making in order to move past the bubble-and-bust economic era into some sustained economic growth, while cutting that deficit in half in four years.  The President remains confident that he can do so.

Q    What would your message to the American people be when they hear about the CBO projecting this much larger deficit, $400 billion additional this year, $400 billion next year?  Do you think their numbers are -- I know you cited other numbers that are more optimistic in terms of growth.  Do you think -- do you reject the CBO numbers?

MR. GIBBS:  No, no, I think -- again, I think there are a series of numbers, opinions that range, as I said -- in terms of economic growth, from the Fed to Blue Chip indicators, growth forecasts, to the federal government and to the Congressional Budget Office.

Look, I think what the American people should understand is that for quite some time we have -- we've had budget deficits and an accumulation of budget debt that the President believes is unsustainable; that his budget takes actions to cut the deficit in half in just four years; and believes that the steps that his administration is taking, as it relates to recovery and financial stability, will put us, as well as the investments in the budget, will put us on a more robust and sustained path towards that economic growth that will help the deficit in many of those out years.

Obviously it is exceedingly hard to project seven or 10 years into the future.  But the President remains confident that the forecast, though, demonstrates that he can cut the budget deficit in half by the end of his first term.

Yes, sir.

Q    Robert, every time when the President talks about health care or education, he always frames it as part of -- being part of the economy and the economic recovery and investment in the future.  What does he actually mean by that -- I mean, in terms of, you know, the actual amount of dollars that this will, you know, present to turning the economy around?

MR. GIBBS:  Well, I mean, obviously a business's ability to grow is impacted by their health care bill.  And a business's ability to grow is impacted by the growth rate in their health care spending.  A business's ability to grow is in many ways dependent upon having a work force that is well trained and well educated in order to do the jobs of the future that the President hopes to create.  And obviously on energy independence, we all understand what $4-a-gallon gasoline can do to stifle the economic growth of a small business, a large business, or impede the budget of a family of four.

There's no doubt that the budget and the investments contained in the President's budgets are inextricably linked to our long-term economic growth.  We cannot sustain the jobs of the future that help us compete on a global economic stage with countries throughout the world unless we bring our health care costs under control; unless we educate our children for a 21st-century global economy; and if we don't get ourselves out of a cycle of dependence on foreign fuel sources -- that all of those play a huge part in our ability to govern our own path for economic growth.

Q    On Iran, is the videotape sort of the beginning of what this administration hopes will be an ongoing dialogue, and sort of the next step is perhaps a face-to-face meeting -- high-level?

MR. GIBBS:  Well, let me -- I mean, I think without getting into what next, obviously there's an evaluation overall of our policy as it relates to Iran.  But the President believes that today marked an appropriate time with which to seek a different relationship with a country, if that country is willing to accept responsibilities to become part of a greater community of nations.

Q    But there's a not step two on paper at this point.

MR. GIBBS:  Well, there is, but -- and there are many more, but none of which I'm going to get into today.


Q    A pretty tough week for the President this week.  He seemed to be losing the message war almost every day.  It was -- every day he had some economic plan out there, and every day it was AIG, or Geithner, or the comments on Leno.  Are you worried that this may be kind of a watershed week when he's losing control of the message?

MR. GIBBS:  No.  (Laughter.)

Q    Can you elaborate?  How's he going to get back on?  How's he going to get back on track here?

MR. GIBBS:  You know, Chip, I -- I'm going to hesitate to rant on my good friends on cable, which -

Q    I don't watch cable, so -- (laughter.)

Q    Chip doesn't have a TV.  (Laughter.)

MR. GIBBS:  Which is ironic.  He has those radios that I was given.

You know, Chip, I think on the -- I think on the President's trip to California, I think there is rightly concern and outrage for the events of the past week, and there's rightly concern and frustration about the economic challenges that this country face.  You heard from teachers that are doing a good job but face the prospect that they won't have their job for the next school year.  You have, I think, all sorts of economic stories that denote the great challenges with which this President was presented when he first walked into this White House.

The President is, as you've heard him say before and you've certainly heard me say before, less interested in the day-to-day score-keeping which has always counted him down and counted him out.

We've been called idiots before.  We understand that.  But the President isn't focused on -- isn't focused on that.  The President is focused on the decisions that he has to make to get the pillars for economic progress in place, whether it's ensuring that the Recovery Act is done in a way that gives people confidence about the money that's being spent to create jobs, and put money back in their pockets; that we're taking steps through the budget to make those critical investments.  The President isn't focused on the ups and downs of day to day score-keeping; he's focused on looking ahead.

Q    So he's not really feeling frustrated that this week the message kept slipping away and getting only chatter.

MR. GIBBS:  I didn't go to California, but it looked like he was having a good time.

Q    On Geithner, is the administration sticking to -- are you sticking to this March 10th date for when he found out about this?  Because I -- he was asked about it in Congress a week before -

Q    It was March 9th.

Q    March 9th.  He was asked a week before, specifically.

MR. GIBBS:  And I think the Treasury Department addressed that in the newspaper this morning.  Look, I think there's -- there has been -- obviously, the Treasury has talked about taking responsibility for knowing more about the timeline.

Q    When Secretary Geithner talked about that yesterday, he really parsed words.  He said, on Tuesday, March 10th, I was informed about the full scale and scope of these specific bonuses.  He's not saying that was the first time he learned about it --

MR. GIBBS:  Well --

Q    A very careful parsing of words here, suggesting he did know about it before then.

MR. GIBBS:  No, I -- I think if you read carefully the report you're discussing, the Treasury Secretary takes responsibility, as the President does --

Q    But he's sticking by that October 10th date -- excuse me, March 10th date --

MR. GIBBS:  Right, I --

Q    -- even though he clearly knew about it before then.  He was asked about it in Congress --

MR. GIBBS:  But, again -- but again, Chip --

Q    -- and he was overseeing the AIG bailout.  I mean, is it --

MR. GIBBS:  What committee --

Q    It just doesn't seem credible.

MR. GIBBS:  That was Ways and Means?

Q    Yes.  But he was specifically asked the question.

MR. GIBBS:  No, I understand.  I understand.  And I think he's addressed that and I think that's addressed in both the reports today and what he said yesterday.  Chip, we're -- we understand and the President shares the outrage and the frustration that everybody has.  The administration is taking steps to recoup money that's gone out, as well as to put in place a financial stability plan and to seek progress on getting our economy moving again.

Q    Let me just ask you specifically.  When he says, on March 10th he was informed about the full scale and scope, is he saying that's the first he learned about it at all?

MR. GIBBS:  Chip, the question is predicated on the report in the paper and I think the report in the paper answers your question.

Q    So he did know about it before then? 20:54

MR. GIBBS:  Chip, I will -- can somebody go get a dollar and buy Chip a newspaper so that he can read the report?  Again, I think it's pretty clear --

Q    Been read.

MR. GIBBS:  Excellent.  Then I believe it's been answered.

Q    Robert, can I follow on that real quick?  Why did you tell us that it was March 10th, then, that you found out?  The statement from the White House was very specific, he found out March 10th.

MR. GIBBS:  Again, I would point you to the report that the Secretary of the Treasury takes responsibility, as does the administration, with knowledge about the structure and the scope of those bonuses.

Q    But we were accidentally or however misinformed about the day that he found out.

MR. GIBBS:  Well, let's -- let's not -- I'm just going to leave it at that.  I think the report is pretty clear and so are the answers.


Q    Did he misinform the White House about when he found out?

MR. GIBBS:  Chuck.

Q    Well, I do watch cable TV and apparently Congresswoman Maxine Waters had a question.  I'll let you answer her question:  What took place between Treasury and Senator Dodd?  What do you guys now know that took place between Treasury and Senator Dodd?

MR. GIBBS:  Well, again, I would point you to exactly what the Treasury Secretary said on CNN yesterday -- that the Treasury Department had concerns about lawsuits involved in the provisions.  The provision that ultimately passed provides a clawback and recoupment look to bonuses through the TARP, at the discretion of an investigation by the Secretary of the Treasury.

Again, I think that the Treasury Secretary has answered this and has the confidence of the President.

Q    Do you feel like her criticism is sort of a -- she needs to (inaudible) interview, or --

MR. GIBBS:  I would point you to that interview, and --

Q    I'm not asking -- her questions, so that means you want to --

MR. GIBBS:  I appreciate that you're now doing this on behalf of members of Congress.  (Laughter.)

Q    She seemed to be concerned.  Let me follow-up on something that the President said last night.  He said -- he talked about this issue of the bonuses, that they were looking at it from a legal term, but that Treasury wasn't looking at it from a moral or ethical sort of -- sort of through a moral or ethical -- didn't get the exact quote -- from a moral and ethical aspect.  So does the President believe Treasury was wrong not to think about the moral and ethical consequences?

MR. GIBBS:  Well, Chuck, I would -- I think the President would say that to everybody involved.  I think the President would say that you have a financial company that entered into contracts in April of 2008 that also didn't understand, as taxpayers have been outraged, as he's been outraged, about the lack of common sense and the sheer breadth of -- the sheer breadth of understanding that bonuses generally reward success, not failure; that the --

Q    Does the President believe he can legislate this compensation issue, or that ultimately --

MR. GIBBS:  Well, let me finish this -- the President understands that, again, the frustration of the American taxpayer, as we watch the fact that we have -- as he said on "The Tonight Show," that there's -- that executive compensation and bonuses and the thinking around a lot of that over the past few years has gotten wildly out of control.

Q    Does he think he can legislate it?

MR. GIBBS:  Executive compensation?

Q    Yes.

MR. GIBBS:  Well, I think, you know, you stood here in this room and heard the President in the Oval Office talk quite clearly and convincingly about proposals that were the strongest in American history to put limits on executive compensation for firms that are receiving extraordinary assistance under the Troubled Asset Relief Program.

Q    But he seemed to talk about the whole moral climate, but outside of this, does he think out -- companies outside the TARP --

MR. GIBBS:  Well, absolutely.  Absolutely.  The President in his -- has long been a supporter of, and has contained in this proposal that shareholders should have a non-binding vote that through the power of their opinion can demonstrate for whatever company they're a shareholder in that the compensation that's involved matches the success of the company, the success for shareholders, and that all of this has to be in some line with reasonable expectations.

You know, study after study denotes the huge increases in where we were just a few decades ago with what a worker made in relation to a CEO and where we are now.  Obviously we have seen outsized compensation and bonuses and salaries that have long gotten out of whack.


Q    On a related issue, Robert, does President Obama believe that the bill passed by the House yesterday to tax the bonus money is constitutional?

MR. GIBBS:  I have not asked the President about the constitutionality of the bill.  I read in the papers that some experts believe the bill to be constitutional.  I don't know that -- I don't know that constitutionality has specifically been looked at here.  I know that the White House is evaluating legislation from the House and whatever legislation might come from the Senate in order to look at two objectives.

The first is understanding that taxpayer anger and frustration that I talked about with Chuck -- understanding, as the President has talked about, that the way this system has gotten completely out of whack; that it lacks common sense; that we are rewarding not success but in some ways failure.

But also looking at whatever legislation comes out of this process to ensure that our ability to stabilize the financial system and ensure that credit flows from banks and lending institutions to families and small businesses and big businesses through capital and what they need to run their business.

So there's -- there is the dual objective that the White House will evaluate.

Q    Well, if the House bill were to reach his desk, would he sign it?

MR. GIBBS:  Well, that's the evaluation that is being undertaken here.  I do believe the President and the White House have concern -- we have to ensure, again, that both of these objectives are met; that the frustration -- the real frustration that taxpayers and the President have about the situation that we've seen with AIG, but also ensure, for instance, that a community bank that took some TARP funding, not because it was necessarily in trouble, but because we all understand that additional capital through something like that can help their balance sheets, and that families and small businesses can see the return of flow of capital to ensure that there is enough for housing loans and auto loans and college loans, and that all of that will be evaluated throughout the process when a bill gets to his desk.


Q    Robert, how concerned is the White House that the new deficit numbers today might further erode support on Capitol Hill for the budget, for the President's other initiatives?

MR. GIBBS:  You know, obviously, again, the President shares the frustration of many about where we've gone relating to fiscal irresponsibility over the past several years.  That's why not only did he present a budget that accomplishes the goal of cutting the deficit in half in his first term, but does so in an honest and transparent way so that we begin accounting for our efforts in Iraq and Afghanistan, disasters that we know -- natural disasters that we know will occur.

But the President remains confident that we can pass the budget that he sent up, making the critical investments that we need, and that we'll have success not just on this but on other legislative initiatives this year.

Q    You don't expect much erosion in support?

MR. GIBBS:  Well, we're -- we want to work with both sides of the aisle to ensure that the President's budget of fiscal responsibility and critical investment moves forward, and we think we can do that.


Q    Robert, whether it's been a good week or a bad week, it appears there is some evidence -- at least in the minds of Democrats, maybe just a small number on Capitol Hill -- for the first time, the confidence and credibility of this administration is at least open to question.  Maxine Waters said this morning on the radio about this Geithner-AIG issue, "Maybe the President is not up to speed on what is going on.  I think this is all going to have to be clarified."  To what degree do you agree with that assessment from Congresswoman Waters?

MR. GIBBS:  I think I answered that with Chuck.  I think what the Secretary of Treasury has talked about over the past few days is quite clear.

Q    That's all the clarification the nation requires?

MR. GIBBS:  No, I -- well, I think we -- I think what the Secretary of Treasury talked about demonstrates actions that were taken, concerns that were expressed, and I would point her to those comments.

Q    Actions that were taken when?  I mean, the country seems to be trying to still figure out, and to a certain degree the Treasury Department is still trying to figure out, exactly when the Treasury Secretary became aware of this:  Asked about it March 30th in congressional testimony; representations here by senior officials and he was first informed of it on March 10th.  I mean, it seems you can't even get the sequence properly aligned.  How can the country then digest whether the policy responses were correct if we can't even get a firm grasp on when knowledge was obtained and when actions were taken?

MR. GIBBS:  Well, again, Major, I don't want to repeat the answers I've given, I think, to both of those questions from Chip and Chuck.  But I'd point you to those reports and those answers.

Q    On the budget, is it the administration's point of view that this is essentially a disagreement between economists; it's kind of a rounding error as far as economic projections are concerned over the next 10 years?  And though $2 trillion sounds like a lot of money, Americans, seeing it on their front pages of the newspapers tomorrow, hearing it as they drive home, shouldn't be alarmed that the deficit is higher than $2 trillion, or -- what's --

MR. GIBBS:  No, let me --

Q    What's the takeaway that -- people will hear this number, and they'll say, whoa, $2 trillion, that sounds like a lot of money to me.

MR. GIBBS:  I can assure people it is.  I can also assure people of this -- that the President has a budget that institutes, for the first time in quite some time, a return to a sane fiscal path that cuts the budget deficit in half during his first term; that puts us back on a framework of an honest budget where we actually begin to pay for our international and domestic endeavors.

Again -- and I think that --

Q    Economists are bound to go by these numbers.

MR. GIBBS:  I understand.  I think that the way I would characterize the differences is the way I characterized them earlier, which was there are differences of opinion between where the Fed believes economic growth will be, where blue-chip economic forecasts are, and where we are in one package and where the CBO is in another.  But again --

Q    But by the Budget Act, they have to go by the CBO numbers.

MR. GIBBS:  I understand.

Q    So you -- you push your agenda through that set of numbers.

MR. GIBBS:  And I think those numbers will validate the objectives that the President outlined at the beginning of this discussion.  I think that's what is important -- again, a decent amount of this growth -- a decent amount of this growth is in the back-year numbers six through 10.  You know, it's a little bit I guess like predicting the winner of your NCAA bracket in six years.  You can certainly distribute sheets, we might all give you $5, but some of the teams you have in there may not actually make the tournament.  I'm extending my sports analogy for yet another important fiscal issue.  (Laughter.)


Q    Does the administration think that its own officials who -- like Jack Lew and Mike Froman, who received executive bonuses last year for companies or institutions that helped lead to this economic downturn -- should give their bonuses back?  Do you want to set an example?

MR. GIBBS:  I don't have information in front of me on that.

Q    So you don't think the --

MR. GIBBS:  I'd have to look at the information that -- what they are and I'd be happy to take a look at that in a second.

Q    Okay.  Can we -- so can we get something back on that?  I'd like to also ask you about --

MR. GIBBS:  I think your paper already has that in to us.

Q    I'd also like to you about Iran.  Did Israel inform the administration that Shimon Perez would be giving out a similar Nowruz message to the Iranian people at the same time the Obama administration was?

MR. GIBBS:  Did Israel inform us or did --

Q    Yes.

MR. GIBBS:  I'd have to check.  I know we notified allies about our message last evening, but I do not know what specific things we might have gotten back from others.

Yes, sir.

Q    Back to the budget briefly.  I understand what you're saying about the out years being hard to predict and future NCAA brackets and all that, but the difference next year -- the current -- the budget that's on Capitol Hill, there's a difference between $1.17 trillion under your numbers and $1.4 trillion.  So that's, you know, more than $200 billion, $250 billion, I think -- a big difference right there.  I mean, is this the CBO's way of saying it's the return of the rosy scenario; that your numbers are --

MR. GIBBS:  No, again, I -- again, only if you assume that the Fed, the blue-chip forecasts, and us are all involved in the same rosy scenario cahoots, which I don't think obviously is the case.  I think the economic estimations that we've made that govern the choices of our budget demonstrate quite frankly that we're comfortably in the mainstream of exactly what those forecasts are.

But, you know, let's extend not just one year, but let's extend to that fourth year and I think you'll see that the -- what the President said originally, that our budget -- the budget that he's presented will cut the deficit in half in four years, is true.

But again, the President has made some tough choices about how to put ourselves back on a path towards fiscal sustainability.  And certainly the American people understand that it's going to take a while to do that.  The President took specific actions earlier in the year to ensure that we had a recovery and reinvestment plan that we think will grow the economy, which ultimately will help both in the short term and in the long term with growth and ultimately the projected budget deficit.

Q    If Congress does, as pointed out, stick with the CBO numbers and makes changes to the budget, is that -- are those numbers things that the President is going to be able to live with?

MR. GIBBS:  Well, the President believes that, and looks forward to working with Congress to create and pass a budget that accomplishes his two main priorities -- making the critical investments that we have to in cutting the costs for health care, for putting us on a sustainable path towards energy independence and reforming the way our children are educated; at the same time, cutting the budget deficit in half over those four years from what he inherited. 

The President looks forward to working with members of Congress to ensure both of -- both of those outcomes.

Yes, sir.

Q    Secretary Duncan said this week, "We're going to reward those states and those districts that are willing to challenge the status quo and get dramatically better."  In line with the President's comprehensive education agenda, what national benchmarks are being set by the President and the White House to measure progress, specifically with respect to college accessibility and the rising high school dropout rate?

MR. GIBBS:  Well, obviously, I would point you to Arne in terms of what changes or what adoptions of specific national standards that he's going to use to evaluate this.  Obviously you've heard the President talk about -- and contained in both the recovery and in the budget are changes in tax cuts for college tuition and an increase in Pell grant funding for individuals.

And obviously the President has talked about, in both his address to Congress and in the larger address to the Hispanic Chamber a few weeks ago, specific ideas on reform, both in -- in the classroom and in changes not just to college accessibility that you mentioned, but efforts to stem the rising tide of high school dropouts so that we can educate the workforce that we need for the jobs the President is looking to create for this country.

I think both the recovery plan and the budget take important steps in ensuring that we are moving towards education reform so that our children are prepared.

Q    Just a quick follow-up.  The $5,500, roughly, Pell grant that has been proposed, the expanded one, does the President feel that's adequate, and would he propose expanding of Pell grants, specifically for students who are interested in service-oriented work?

MR. GIBBS:  Well, I think the President has talked about and I think Congress is working on national service legislation.  The President talked about that throughout the campaign.

Look, the Pell grant has, for a long, long time, failed to keep up with, in any moderate way, with the rapid growth in college tuition.  The very first piece of legislation the President introduced as a member of the Senate was a bill to change and increase the amount of money for Pell grants, because many years ago a Pell grant would pay for, for somebody, their entire education for a year, rather than now paying for just a small sliver of their tuition, because we've seen -- we've seen the cost of college tuition skyrocket on the same frame that we've seen the costs of health care.


Q    Does the President agree with Chairman Bernanke that it's important not to grow the debt-to-GDP ratio for the medium term?  That the deficit should not be larger than the growth of GDP for the medium term, once we get out of this --

MR. GIBBS:  I have not seen what Chairman Bernanke said or -- I don't have in front of me comparison of those figures.

Again, the President in outlining his budget took steps to ensure that where we are today in the budget deficit that the President inherited, I think the ratio is about 10 percent of GDP.  And obviously that is a number that is certainly not sustainable.  But the President -- that's why the President made some tough choices, certainly, to bring that number down over the course of cutting the deficit in half in four years.

Q    But that seems to be the headline of the CBO today, is that they have the deficit larger than growth of GDP in that middle term, you know, after we get out of this current rut we're in; they still have the deficit as larger --

MR. GIBBS:  I have not -- I have not read the full report before coming out here.  But pose that question to Peter, because he's got a pocket calculator that does all that.  (Laughter.)


Q    Robert, two things.  One -- two unrelated things.  On health care reform, the President and everybody in the administration practically has stressed the importance of it.  Why then is the administration deferring so much to Capitol Hill to draft it?

MR. GIBBS:  Well, Kirk, I think you saw an effort by the President a few weeks ago to bring not just the members and players that will be heavily involved in this process from Capitol -- from Capitol Hill to the White House, but also members of -- that represent doctors and pharmaceutical companies, business, labor -- all of the players involved, to have the beginning discussion on a health care reform plan that will cut costs for the American people.

This isn't going to be done by any one person or any one group of people.  Obviously health care reform and the health care -- health care at large is such a huge entity that all of the players that I just mentioned are going to have to be involved, whether they're in Congress, whether they're in the White House, whether they represent constituencies that will be affected.  But obviously the White House is going to play a role in that, Congress is going to play a role in that, business -- all these entities will play a role in that.  I think the President believes that, as he stated numerous times throughout the campaign, that we have to bring -- in order to reach that consensus, we're going to have to bring all of those groups and parties together to have this discussion and work out a health care reform plan that makes sense.  And I think that's the process.

Q    I have one last question.  Has the White House consistently underestimated the level of public outrage, whether it's about failure to pay taxes by some of your nominees or the bonuses now to some of the companies on Wall Street?

MR. GIBBS:  No, I would reject that characterization uniformly.  I think you've seen the President just this week express outrage.  I think you've seen the President do more than just express outrage about executive compensation and bonuses and take crucial and important steps in order to limit that in a historical way. 

I think the President understands -- and I think that's one of the reasons he is the President -- that he understands the outrage of what's happening -- what's happened inside Washington and how that is viewed outside of Washington.  But I think the President understands that and is taking steps to ensure that as we go forward that we're not doing things the same old way.

Q    Thanks, Robert.

MR. GIBBS:  April.

Q    Robert, real fast.  How did the President enjoy and how did he feel about Jay Leno last night

MR. GIBBS:  He seemed to have a good time.  They got back a bit late.  Look, I think the -- you know, many people in this room lauded the campaign for its ability to reach out and talk to people in society that may have been disaffected or that weren't participating and be able to reach them about their causes and their concerns, and most importantly, to give them a sense and an idea of the solutions and the path that he thought this country should be on to address those challenges.

I think last night was something very similar to that, and I think the message that we released overnight to the people of Iran was also an extension of communicating with people where they are about their cares and concerns and taking -- making sure that people understood where we want to go and the ideas and the solutions that we have.

Q    And is the President going to take the advice, after understanding the gravity of what he said about the issue of Special Olympics, is he going to take the advice to hire someone from the Special Olympics, to bring them here to work here?

MR. GIBBS:  I have not seen that.  I know that the President believes that the Special Olympics are a triumph of the human spirit, and I think he understands that they deserve a lot better than -- than the thoughtless joke that he made last night, and he apologizes for that.  Thanks, guys.

Q    Have a nice weekend, sir.

MR. GIBBS:  You, too.

3:12 P.M. EDT