News from the Washington File
Q: Ari, you just talked about the economy and the no timing of the tax cut being related to the war in Iraq. Yet, this coming at the same time with the tensions with Iraq and the situation in Venezuela is pushing oil to $40 a barrel, and you've got a frigid winter in the northeast driving up natural gas prices. Is the cost of energy going -- is the President concerned that the cost of energy for Americans is actually going to punch a hole, and kind of negate the effect any benefit you might get from the tax package? And is anybody in the administration giving new thought, perhaps, to taking steps to alleviate this in the near term?
MR. FLEISCHER: Well, the cost of energy remains a very important, and the availability of energy remain very important issues for both the President and the Congress. And there have been a confluence of factors involving both the cold weather and a shortage of supply that have led to an increase in the prices, which concerns the President greatly. There is a cyclical nature to some of this, and we have seen the prices go up and down before.
To avoid a repeatable, predictable pattern of the cyclical nature, which hurts consumers, the President believes that is why Congress must pass a comprehensive plan to deal with energy, to increase conservation and to create more supply. These become predictable debates in Washington, as prices go up in the winter, and then they come down, and they go back up in the summer. The President thinks that people came to Washington to think long-term, and to act long-term, and to get ahead of the cycle. And that's why it's so important for Congress to pass the comprehensive legislation that the President has discussed to increase conservation and promote more production.
Q: If I could just follow. In the last 30 years, when oil hits $40 a barrel, it typically triggers a recession. Does the President believe that the tax package that he has before the Congress now will be enough to curtail a possible recession if oil stays at $40 a barrel?
MR. FLEISCHER: Well, I think, one, today is the perfect day to study some of these benchmarks about predictions and patterns, given the fact that the best estimators in the government did not have the estimate correct about the past. The fourth quarter GDP report we have today, it does indicate that you have to be guarded about estimates into the future. And that's why the President's focus is on the principal policies -- in this case, the American people need to conserve more, they deserve to have more supply. And we need to have an economic growth plan in place that creates jobs. All of the above.