MR. FRATTO: Good morning, everyone. Just a couple things to note. The President -- we haven't given you a schedule for what the President will be doing on the next two days. I say at least for tomorrow, Thursday, the President -- I'm sorry, today is Tuesday. Read more Comment (0), Email this.

MR. FRATTO: Yes. (Laughter.) The President will be here on Wednesday. The President will be here on Thursday. And we'll let you know about Friday, but the President intends to stay here to work on this financial rescue package with members of Congress for as long as it takes to get this done, because it is critical. And if we need to change our plans for Friday, we'll do that. Read more Comment (0), Email this.

MR. FRATTO: Both, all of the above. Working with his staff here, talking to members of Congress, working with Secretary Paulson, hearing from the Fed Chairman, Ben Bernanke, and other regulators who have ideas and options and anything that can be constructive in terms of a way forward to try to get this legislation passed, because obviously the crisis we were dealing with before is still with us today. There's still evidence of that, that markets are under stress and the banking system is under stress, specific banks are under stress.

I think I told some of you this morning that -- you may have heard it from the Senators' offices -- that Senator McCain and Obama each called the President this morning. They offered constructive ideas and had a good conversation with the President. The President appreciated hearing from them and about their commitment to continue to work to try to get this problem solved, and to get legislation that will help the economy and that can get passed by both Houses of Congress.

So that's where we are today. The President has been meeting with his team and having conversations with his team here. I know -- a number of you have asked this morning who he is calling, who he's meeting with, and I just want to be clear, we're not going to read out every meeting and every call that the President has on this in coming days. There will be a lot of work that gets done, and what we are working on is the strategy and ways that we can -- whether it's augment the bill or strengthen the bill in ways that will, again, help the economy and be able to pass both Houses of Congress and that the President can sign.

Ben. Read more Comment (0), Email this.

Q Just to follow up, first of all, on that point, Tony. Is the White House strategy going forward

MR. FRATTO: No, I don't think we have to start all over. We do have a solution that will fix the problem, and that's the original proposal that was made by Secretary Paulson. We have to remember that while we have a political and legislative problem here, that the problem that we most need to fix is the economic problem. So we want to make sure the economic policy is the right one. There may be ways to improve upon that and to help the economy in other ways that could contribute to legislation that can pass both Houses of Congress, but that's our test: Does it, first, fix the problems with our economy, or help to improve the problem in our economy, and strengthen markets and our financial institutions so that they do not damage the real economy out there. Read more Comment (0), Email this.

Q But, Tony, if you say that you have a solution and the solution is the original proposal made by

MR. FRATTO: No, not at all. In fact, I think what you heard us say and heard the President say a number of times last week, including in his address to the nation, was that our work with Congress greatly improved the original proposal that was put forward by the administration. That was - Read more Comment (0), Email this.

MR. FRATTO: No, no, no. Well, let's be clear. The proposal that Secretary Paulson made, that the administration made, is an important part of the solution. That core idea of taking these assets that are not trading in markets today, that is what is essentially a frozen market, that needs to be part of a solution. We need to address those assets and to get a market restarted so that banks and businesses are able to operate in their normal way, where banks are able to lend to each other overnight, and businesses are able to borrow from banks for overnight lending.

We're seeing lots of strains throughout the country, especially from small businesses who are searching for overnight lending. Banks are having a very difficult time lending. We saw that again in overnight credit rates last night where the spreads on those rates increased again.

So there's real stress in the market, and that is a solution to fix it. But to get to your point, there's no single silver bullet here. There are lots of good ideas that can help the financial services industry and our financial markets, and we're going to look at all of those ideas. Read more Comment (0), Email this.

MR. FRATTO: Not at all. No. Those were -- we've said this a number of times -- those were good additions to our original proposals; they strengthened it, they improved it, and we'd like to keep that whole package together.

Yes, Matt. Read more Comment (0), Email this.

MR. FRATTO: We believe it can be. I know -- a lot of you noted I came here yesterday, stood here and said that I thought we had the votes to pass the legislation yesterday. And a lot of us -- Read more Comment (0), Email this.

MR. FRATTO: -- a lot of us did. Not so good, and not for the good of the country. But it wasn't for lack of trying. There was a lot of work that went into it. We didn't get the votes that -- that we needed. And you saw the reaction. But we're going to go back to it and keep trying to get this done, because as Secretary Paulson said yesterday, we simply cannot allow this to fail because the damage to our economy would be too great. Read more Comment (0), Email this.

MR. FRATTO: We're very hopeful. We think it needs to be done. And when something needs to be done, then we need to be working as hard as we can to get it done.

Kathleen. Read more Comment (0), Email this.

Q Tony, in the past, on important controversial issues, the administration has really worked the

MR. FRATTO: Look, I know that yesterday afternoon erupted into, as only Washington can, a number of hours of great finger-pointing. You didn't see that coming from here. We're not going to engage in finger-pointing on this issue. What we're focused on is fixing the problem and trying to get it to a solution that can pass.

A lot of people may want to be critical of what we've done. We're dealing with a really unique challenge here. Unlike a lot of other policy issues, the way we talk about markets and things that the federal government will do with respect to markets has market outcomes. If you were watching 10 or 11 days ago, when just the rumor that we were going to have a proposal hit the markets, I think the Dow went up 300 points in an hour and a half in one afternoon.

So we have to be very, very careful about how we talk about the things that we're going to do that affect markets and the economy, and that's a constraining thing. We're also dealing with an incredibly complex issue -- not just in the solution and how it works, but also the problem. We spent a lot of time talking about -- talking about the problem and how it affects Americans in their daily lives, and it's a hard thing to do because there are four or five steps involved in that before you get to the kitchen table of the average American family and how it affects them.

So it is a challenge. We try to do it; I know all of you try to it, too, to deal with the complicated -- all of a sudden all of you are also financial news reporters now. Next week you might be foreign correspondents again on some other issue. So it's a challenge for everyone in terms of explaining it. And we try to do the best we can. We put the President out on national television with an address to the nation that was very well received. A lot of the members appreciated that. And we heard that people throughout the country appreciated hearing that explanation also.

So we're going to keep doing that. We obviously have more work to do, and I think we'll be able to do it. Read more Comment (0), Email this.

MR. FRATTO: I don't think it's a conservative thing or a liberal thing. We're talking about the U.S. economy. I know there are people out there who talked about this as a -- its impact on people who think about the free markets. We're not talking -- this isn't a debate -- this isn't about free markets or socialism. This is a debate about frozen markets. And you can't have a free market when you have a frozen market. And what we're trying to do is unfreeze this really important part of our market that has an impact on every financial transaction in this country in one way or another.

So that's what we're focused on. It's not an ideological debate. We need to be able to better demonstrate that there are impacts for American families, for retirees, for small businesses, for larger businesses who are hiring, for our banking system, for the ability to get home loans, for businesses to be able to make their payrolls, their small business accounts. These are all the things that are affected because of this one frozen asset class. And that's the problem that we're focused on and trying to fix.

Yes, Jeanie. Read more Comment (0), Email this.

MR. FRATTO: We don't want to debate this bill in the press. I think what we want to do is to have our conversations with staff and members. We're willing to listen to any idea that anyone out there has, whether in Congress or in the private sector. Some of you have asked about the FDIC idea that a number of people are talking about today. It's not necessarily a new idea; I know Sheila Bair, over at FDIC, has raised these kinds of solutions in the past. Larry Lindsey, who was the former Director of the National Economic Council here at the White House, has written about that idea. It's something that we'll pay attention to and discuss. But I'm not going to get into discussions of the various pros and cons of each idea out there. I don't think that's the most constructive way -- Read more Comment (0), Email this.

MR. FRATTO: Absolutely, yes.

Yes, Mark. Read more Comment (0), Email this.

Q Tony, is it the world "bailout" that you think did you in yesterday? Listening to you and Gillespie

MR. FRATTO: I think it's really unfortunate shorthand for a very complicated issue. You all know me; I'm not someone who bashes the media. I think I've been clear; this is a very difficult issue for everyone to communicate on. But we presented ideas that were -- that talked about a very specific problem in our economy and what our goal was to try to correct that problem. Our critics took the language of a bailout for Wall Street. And I think it's undeniable that the media chose that branding of this debate -- and I see it on all the scrolls, I see it in the headlines. Like I said, I'm not bashing the media, but I'm saying that was unfortunate to take the language of the critics to brand what this policy debate is about.

It is not a bailout for Wall Street. It is certainly not a bailout for Wall Street CEOs. It is an effort to fix this problem of a frozen asset class that has implications over our entire economy.

We have a couple days here now where we're going to work with Congress and we're going to continue to communicate on this. And hopefully we can do a better job of making clear just what our goal is and what we're trying to fix. Maybe more American people will be able to see that and hopefully more members of Congress.

Ben, why don't we go to -- Read more Comment (0), Email this.

Q Just a quick follow-up on the President's role in this. He's spoken nearly every day of late,

MR. FRATTO: I think there has always been far too much made of any one President's powers of persuasion on an issue. We've had some really difficult debates and battles over legislation this year; we've won a lot of them, and we won a lot of them with that group that you're referring to.

This is, like I said, a very complicated issue. There are strong feelings on both sides about it. But what we are focused on is helping everyone to understand the problem and why the package of solutions that we're putting forward will be effective in addressing that problem. And that's what we're going to be focused on. We are not going to get in the business of pointing fingers at others on this.

Yes, Roger. Read more Comment (0), Email this.

MR. FRATTO: I think I just want to leave it at the test that I said, which is, if it will help the economy, if it will help deal with this problem in our financial markets and the strength of our financial institutions, and if it will help in being able to pass legislation, those are things that we'll consider.

But the core of the idea that the administration put forward, with respect to these mortgage-backed securities and other distressed assets, we think is critical to the solution. We talked about $700 billion to invest in this asset class and to try to build a market. A lot of people have talked about it as a major spending program. We think it's not really a spending program; this is an investment in an asset. We're going to try to have a well-functioning market, and we think that the -- there will be a return on that investment to taxpayers so that it will be a fraction of the $700 billion.

That one issue alone is a very -- has been a great challenge to try to explain. We're going to continue to try to do that and help people understand this isn't a spending program; this isn't going into people's wallets; we're not buying disposable products with it. We're investing in an asset class that has value and will have a return to taxpayers. And that's a very important part of this, and part of the explanation for this, for why it's needed and why the program will be effective. Read more Comment (0), Email this.

MR. FRATTO: That was the number that Secretary Paulson and his team, and Chairman Bernanke and others felt would be most effective in being able to deal with a market of this size. It's a huge market. It's measured in the trillions of dollars. And they felt that a $700 billion program is necessary to have the appropriate impact.

If you try to have a political solution on that number, and you bring it lower, then you may not be -- you may not be doing what is best for the economy. So we have to try to do what's best for the economy.

To put it in some perspective, we're talking about a $700 billion investment program in assets. In one quick afternoon yesterday, our equity markets lost $1.3 trillion in value -- in just an afternoon. And we're talking about a two-year program that will involve investments that we know have -- that are well-performing, they're backed by the mortgages of millions of Americans who actually, by and large, overwhelmingly, pay their mortgages and pay them on time. Read more Comment (0), Email this.

MR. FRATTO: We think that's the right number. Unless Secretary Paulson comes back and says it's a different number. That was his expert, considered judgment of his team and other federal regulators and people who follow the markets. So we're going to take Secretary Paulson's advice on that.

Yes, Wendell. Read more Comment (0), Email this.

Q Tony, the flip side of finger-pointing is responsibility. By my count, the plan got not a single

MR. FRATTO: Now, I don't think I'm going to be able to get into explanations for why anyone -- or any one group of members of Congress voted the way they did. What happened yesterday -- Read more Comment (0), Email this.

MR. FRATTO: I don't think so. The President worked incredibly hard on this. He worked on it personally. He was personally engaged. He was personally engaged with his team, and he was engaged with the leadership and members. At any rate, that was yesterday. And we're looking towards tomorrow and the next days to try and get this done. That's what our focus is on.

Yes, Peter. Read more Comment (0), Email this.

Q You talk a lot about the issue of how to explain it to make sure people really understand the consequences

MR. FRATTO: Well, I don't know. I'm not -- I don't think I'm going to do analysis on -- I don't think I can do analysis on that. Look, it is a very, very complicated issue. You know, I could tell you something -- something we pay attention to here, in terms of how the markets are faring. You hear us talk about credit markets, right? Well, something we look at is the Libor rate. Well, can anyone -- raise your hand if you're familiar with the Libor rate. The London Interbank -- Bloomberg would know. All right, the London Interbank Overnight Rate.* It's banks lending to banks. That is a critical number.

Well, it reached -- that spread reached an all-time high last night. Okay? I mean, that is our communications challenge, is to explain why the Libor rate is at all relevant to an American's ability to get an auto loan, or a small business' ability to maintain their payroll account at a financial institution. There are a lot of steps between the Libor rate and the homes of Americans. So we obviously have a challenge.

Now, we've tried to do this in, now, less than two weeks, from the day that Secretary Paulson and the President and Chairman Bernanke came forward and talked about the crisis and what we were going to try to do it, in a very, very short period of time, tried to help Americans and work with members of Congress to get legislation that tackles this very complicated issue. It's not an easy challenge. If people want to point fingers at us, that's fine, but we're going to focus on continuing our efforts to communicate on it and continue to work constructively with members of Congress to get to a solution.

Yes, Yunji. Read more Comment (0), Email this.

MR. FRATTO: That would be a misreading of what I'm saying. I think we're going to continue to -- continue to carry our message forward in every way that we can. So that continues; and our efforts to continue to improve the bill in a way that will assist the economy and get enough votes in Congress is our other goal. And I'm not saying that they're not connected, but it's not one or the other. Read more Comment (0), Email this.

Q Okay. And the other question is that, I know you don't like poll numbers, but a new ABC News/Washington

MR. FRATTO: No, I think you can find lots of people who can comment on polls, but I won't.

Paula. Read more Comment (0), Email this.

Q You mentioned repeatedly of frozen assets, assets that have value. But what about human assets

MR. FRATTO: Which -- let me try to break down your question in a few different ways. You talked about unemployment insurance. We extended unemployment insurance. Congress put that forward for a 13-week extension of unemployment insurance, from 26 weeks-six months, for an additional 13 weeks extension. Read more Comment (0), Email this.

MR. FRATTO: The additional 13 weeks for those people who have been on unemployment insurance already for six months, for them it does expire. But it rolls, depending on when you get on the program, so that if you are on the program today, if you go on this week, you have the original 26 weeks, plus an additional 13 weeks. So that's where it stands today.

Congress may have ideas on things that they want to try to do with respect to unemployment insurance. They may try to find legislative vehicles to deal with them. We'll have those conversations with Congress if there are other efforts that they want to do. But with respect to this particular problem, if you want to help those people at their kitchen table, if you want to help the ability of their employers to keep them employed, then you want to fix the problem that we're trying to fix this week.

And there will be -- there is nothing we can do that is more important for the U.S. economy, short term and long term, than to fix this problem with this frozen asset class. It is the single best thing we can do for the economy. That's our primary focus, and that's what we're going to be working on. We'll obviously continue to talk about other issues also if Congress has interest in them. Read more Comment (0), Email this.

MR. FRATTO: I think we will leave our negotiations for our discussions with members of Congress and not try to have me negotiate from here.

Let me go to Olivier, and then Les. Read more Comment (0), Email this.

MR. FRATTO: Not that I'm aware of, no. Read more Comment (0), Email this.

Q And in the readout of the telephone call with the French President, the White House indicated that

MR. FRATTO: Well, I think it's premature to say what exactly the forum would be and how it would work. What the President is focused on this week is this problem. We'll figure out next steps, especially with respect to the global economy, in the coming months.

He really appreciated President Sarkozy's commitment and thinking on this issue. We've been engaged in the international community on ways to improve the functioning of the global economy and how to deal with capital flows across borders. We've dealt with this with the Financial Services Forum. They have put forth a lot of ideas that we approve of. These are conversations the President has had with not only President Sarkozy, but with Prime Minister Brown and Chancellor Merkel and others.

We will try to get to that, and I think we will, and we'll have these discussions. I can't tell you what -- I don't know specifically what the President may or may not have agreed to, other than to continue this discussion and see where it goes from here. And we'll let you know if there's an announcement. Read more Comment (0), Email this.

MR. FRATTO: Well, for the IMF -- that weekend, the IMF and World Bank meetings, the G7 finance ministers will be here meeting. They will be meeting for sure. And they talk about these issues at each of their meetings, three or four times a year. And obviously it would take -- there might be heightened interest this time. But I think those will be meetings that we want to be paying attention to.

Les. Read more Comment (0), Email this.

Q Thank you, Tony. Two questions. The AP reports from Caracas that President Chavez said on Sunday

MR. FRATTO: We'll just see what happens with Russia and Venezuela. I don't have a view on that right now. Read more Comment (0), Email this.

Q Okay. The AP also reports that 33 pastors in 22 states make specific endorsements of political

MR. FRATTO: Those rules are set forth in IRS regulations, directed by statute. And the IRS is enforcing the law, and the President believes that the IRS should enforce the law. But on the specific question of these clergymen, I haven't had that conversation with the President.

I'll come to you, April, right after Rich. Read more Comment (0), Email this.

Q Given the breakdown of the House vote yesterday, that you had about 60 percent of Democrats, I

MR. FRATTO: We will talk at great length with Republicans about their concerns, but this has to be a bipartisan effort. I've been asked the question, are you going to try to get more Democratic votes; are you going to try to get more Republican votes? We want to raise the number of concerned votes, people who understand that this is a real problem that needs to be fixed, and that these are solutions that will help our economy and deal with this problem. And I don't think we're going to limit it to one or the other side of the aisle. It needs to come from both sides of the aisle.

April. Read more Comment (0), Email this.

Q Tony, you say it's a bipartisan effort. Just before you started your briefing, there was word

MR. FRATTO: I think we've given a great deal of detail. Secretary Paulson testified I think for nearly six hours on Tuesday and five hours on Wednesday, answered hundreds of questions about this proposal. We've tried to provide as much information as possible on this. They have had caucus meetings, both Republicans and Democrats. It's been -- I don't -- there may not be another issue that has received as much media attention and analysis as this issue has this year.

So there is a lot of information out there. It happened in -- with a great deal of discussion with members of Congress. We listened to them, we incorporated their ideas, and we ended up with a strengthened bill. And we're going to continue to work with them until we can get the ball across the goal line. Read more Comment (0), Email this.

Q And then a follow-up. Is this administration willing -- one of the options on the table -- to

MR. FRATTO: This is a question that was asked earlier. We are not going to -- the size of the program can't be guided by politics. It has to be guided by the problem that we're trying to fix. And the size of the market -- Read more Comment (0), Email this.

MR. FRATTO: For us to do a program that is ineffective would be incredibly wasteful. Now, everybody wants to protect the taxpayer. The worse thing we can do to the taxpayer is to allow this degradation in our economy right now, in our financial system to continue. That is the absolute worst thing we can do for the taxpayer.

So we need to focus on fixing the problem. And our experts at places like the U.S. Treasury Department, the Securities and Exchange Commission, the Federal Reserve, the Federal Reserve Bank of New York, and others who analyze this issue and this market, believe that a size of $700 billion is appropriate and necessary to address the problem. Read more Comment (0), Email this.

MR. FRATTO: Treasury -- I think Treasury testified on that number. Read more Comment (0), Email this.

MR. FRATTO: No, it didn't come out of the air. Read more Comment (0), Email this.

MR. FRATTO: Okay.

Yes, Goyal. Read more Comment (0), Email this.

Q Thank you. Talking about U.S. economic crisis, we are only step away as far as the U.S. civil

MR. FRATTO: We have been in very close contact with Majority Leader Reid, who has committed to getting that agreement passed in the Senate. I don't know if the President and Majority Leader Reid have specifically spoke about it recently. But I know our staff has, and Secretary Rice and others have been in contact with the Senate and his office. And it's something we -- it's a very, very high priority for us. We want to see it get accomplished, and Senator Reid does, as well. Read more Comment (0), Email this.

Q And second, as far as meetings between President Bush and President Zardari of Pakistan in New

MR. FRATTO: I have to apologize, I wasn't in New York for the meetings at UNGA. Read more Comment (0), Email this.

MR. FRATTO: I don't know. It's not a conversation I had with the President. I'm sorry, Goyal. Read more Comment (0), Email this.

MR. FRATTO: Good afternoon, everyone. Let me make a couple quick announcements and then we can get to questions -- and I'm sure questions of the day.

Obviously, you know the President early this morning, at 11:10 a.m., met with the President of Lithuania. I think you may have his comments by now. President Adamkus has been one of Europe's most principled leaders in defending the sovereignty and independence of all Europe's nations, including through policies to strengthen Europe's energy security. He and the President had a very good meeting, talking about regional security issues.

And at 2:25 p.m. this afternoon the President meets with the President of Ukraine. The President and President Yushchenko will discuss how to reinforce democracy, security and national sovereignty in Ukraine and throughout the region; and steps to advance Ukraine's efforts to integrate into the Euro-Atlantic community.

And then in about 35 minutes or so, members of the House of Representatives will have an opportunity to take an incredibly consequential vote on legislation that's critical to our nation's economic future. Over the past 10 days we've had an extensive amount of debate and discussion, hearings, hours upon hours of negotiations -- some that went well into the wee hours of the morning; and I know on Saturday night, drafters up on the Hill actually worked all the way through the night to get the legislative language of this bill.

It is not a perfect bill. Anyone looking for a perfect bill won't find it. It wasn't a perfect bill when the administration sent it up to Capitol Hill a week ago. But over the past 10 days, and certainly over this weekend, the work that went into it made it a much improved bill and, in fact, we think a very strong bill. It gives the Treasury Secretary the tools he needs to address the credit crisis that is now confronting our economy.

The way they improved the bill was listening to members of Congress and others who had ideas out there. This bill now has very, very strong taxpayer protection provisions in it, to make sure that taxpayer money is used carefully and wisely, that we can feel with good confidence that the proceeds from the asset purchase program will go to -- over the long-term, should we see a positive return, to even reducing the deficit. That language is in the legislation.

We have incredibly strong oversight in the program. In fact, I'd say there may be challenge to find another federal program that has more oversight and supervision than this program will have once it's in place. Congressional Oversight Committee is a special bipartisan oversight committee, a special inspector general, a Treasury Department inspector general, regular reporting, so -- reporting on the Internet of the actions involving the purchase program. So I think there will be a great deal of sunshine in how this program is operated by the Secretary of the Treasury.

Also in recent days the bipartisan group that worked on this legislation listened to the members of the Republican Caucus who had ideas that they wanted included in this bill. The bill includes a strong mandate that the Treasury Secretary will put in place -- and insurance guarantee program -- an alternate idea that was raised by members. So over this time, the bill has been greatly improved. We'll never have a perfect bill, but we think this is a very, very strong bill, and is critically needed by our economy right now.

The President this morning -- you saw he made a statement early this morning from the South Lawn. Throughout the morning the President has been on the phone talking to Republican members of Congress, encouraging them to support this bill. It's no question this is a very difficult vote for members of Congress. It is very tough to vote to try to prevent a crisis and get credit for it, and so this is -- the President recognizes this; the Vice President has been calling; other members of the President's staff here at the White House -- Chief of Staff Josh Bolten, and the Assistant to the President for Legislative Affairs Dan Meyers, Ed Gillespie, Secretary Paulson and others -- are talking to members to try to ensure that we get a successful vote in the House.

I appreciate all the work of the leadership, Speaker Pelosi, the Minority Leader John Boehner, Roy Blunt and other members of the negotiating team for the extraordinary work that they did to get the bill to this point. And like all of you, we'll be watching the vote here shortly, and we hope to see it pass, and we're confident that it will pass.

Yes. Read more Comment (0), Email this.

Q Two things. Can you talk a little bit more about the President's phone call -- how many people

MR. FRATTO: Yes, I think Treasury -- oh, I'm sorry, your last question first -- I think Treasury said they will need a week or two to actually be able to start up the program. But I'm going to have to refer you to them for questions on how to implement the program.

Of course, we'll still be waiting for the Senate to vote on Wednesday, should the House pass the legislation today.

The President had a list of a couple dozen members. I'm not sure how far he was able to get through that list. But reporting back from those calls was -- you know, some people committed to voting for the bill, others remain skeptical. The President promised them that the questions that they have, we'll try to address them, try to get them more information. We've tried to do this with lots of members at various different levels. There still are questions out there, and we're not surprised that there's skepticism about the bill.

Like I said, we put this program before the Congress in very short order, and it's an incredibly complex issue that we're trying to deal with. I think everyone has had challenges. You all have had challenges sometimes trying to explain this in your reporting. It's hard to explain the problem and the solution and what the various impacts will be. And we've tried to do this with members of Congress as well. We think we're going to be able to get there and have a successful vote. Read more Comment (0), Email this.

Q Tony, can you drill down a little bit, though, into the skepticism? Maybe it's being felt outside

MR. FRATTO: I think one of the big things is, if you look at any headline across the country, or the scrolls along your screens and the leaders into a lot of your stories, is the reference to this as simply a bailout and a bailout for Wall Street. I think a lot of the reporting in recent days that I've seen has gone into a lot more -- a lot better explanation of what exactly we're trying to solve here. I think the President's address to the nation the other night did a very good job of laying out what the problem is and why it is important to Americans.

But when you call something a bailout, there aren't a whole lot of people who are out there who are in favor of a bailout. We're trying to change everyone's understanding of this; that what we're trying to do is deal with a systemic problem in our economy that is affecting Americans in their daily lives far removed from Wall Street. We need to make sure that Wall Street is healthy and functioning because we need our entire financial system functioning.

But when you have small businesses in Illinois and Missouri who are having trouble getting overnight credit to meet their payrolls and to get credit to purchase equipment and to ship their goods, that's a problem. That's where our economy can grind to a halt. And that's what we're trying to prevent. Read more Comment (0), Email this.

MR. FRATTO: I hope so. I mean, I think so. I've seen a lot of information flying around over the last couple days and certainly this morning. I think members of Congress will have more than enough information that -- to go out and speak to people in their districts and explain to them why this vote was critical. The information is there, and I think it's clear to everyone. We heard it from Secretary Paulson and Chairman Bernanke when they testified on Capitol Hill.

I think members of Congress will certainly have that challenge. And I understand that challenge. I worked in the House of Representatives and understand what it's like to deal with constituent calls coming in. But we do believe that there is leadership in the House of Representatives right now on both sides of the aisle to do the best thing for the economy and the country.

Yes, Matt. Read more Comment (0), Email this.

Q Tony, earlier today the governments of Belgium, the Netherlands and Luxembourg partly nationalized

MR. FRATTO: It's something that I know Secretary Paulson and his Undersecretary for International Affairs, Dave McCormick, is spending a lot of time with, talking to the G7 partners and the G10 countries who deal a lot with financial issues and central banks. Chairman Bernanke is spending a lot of time with his central bankers discussing ways to deal with the -- it's a global liquidity crisis. Some of it's contagion; some of it is simply countries who are experiencing the very same root causes that we had, in terms of the mortgage markets and increases in foreclosures.

So, you know, we need all hands on deck on it, and I think that's what Treasury and the Fed are trying to do. Read more Comment (0), Email this.

MR. FRATTO: He has spoken to G8 leaders in recent weeks and this issue has come up. And of course you know Gordon Brown was here just last week and they discussed this as well, and talked about the way forward.

What the President is focused on right now is dealing with our most immediate crisis here in the United States, and we'll continue to deal with the international -- the global economy with other leaders as we go forward.

Kathleen. Read more Comment (0), Email this.

MR. FRATTO: I think we're going to have a sufficient vote to pass this. We're certainly confident that we are; we're not taking it for granted. These are very legitimate concerns and questions that members have. We're going to keep working with them right up to the vote. We will not take a single vote for granted. And we'll be watching the members' vote, just like all of you will.

Yes, Roger. Read more Comment (0), Email this.

MR. FRATTO: Coordinated with other banks. Read more Comment (0), Email this.

MR. FRATTO: That's not something that -- that's not something that we share. I mean, I can tell you that the President -- the President was briefed on the actions that the Fed took. I can't tell you the specific timing; it's not something we would ordinarily do. Read more Comment (0), Email this.

MR. FRATTO: I'm not going to try to interpret what happens in markets. The agreement was out before the Asian markets opened, and lots of people can speculate what it would have been had the agreement not been out. I'm not going to try to do that. I know that that was a focus of the Majority Leader and the Speaker, and rightly so. And we're glad that it was out at that time. Read more Comment (0), Email this.

MR. FRATTO: I would not try to make that kind of explanation. There are lots of things going on in the global economy right now, and you're seeing lots of activity in Europe and here. And I'm not going to try to psychoanalyze investors right now, with one exception -- I think I have a fairly good sense of what international investors' reaction would be were this legislation to fail. And so we're focused on trying to have this legislation passed.

Sheryl. Read more Comment (0), Email this.

Q Tony, when this package was announced, I think the idea behind it was that it would be so overwhelming

MR. FRATTO: This package will deal with a very specific problem in our economy and provide an anchor for our financial institutions and help to support a market for these mortgage-backed securities that are causing problems for our financial institutions.

I don't want to try to oversell it or undersell it. It is very large. It should have a substantial impact in increasing stability among our financial institutions. We think it will. Secretary Paulson thinks it will, and so does the Chairman of the Federal Reserve.

So we think it is the right size, and we think Secretary Paulson would be able to carry it out in a way that would be very, very effective.

Yunji. Read more Comment (0), Email this.

MR. FRATTO: That's -- I don't think it does any good to try to speculate as to where things will go next. Obviously our experts and analysts are doing a great deal of analysis, looking at where our financial institutions will be and ways we can ensure that they're going to be healthy.

They've just gone through an incredible transition period. We now have a New York financial district without a single independent investment bank. We're seeing lots of consolidation. There are a number of banks out there -- as the President said this morning, a lot of our financial institutions even with this package will continue to be under stress. And I know the FDIC and the Fed and Secretary Paulson are keeping an eye on those institutions.

So I'm not going to try to speculate. Like I said, I think this will make a very important, substantial contribution to increasing stability in our financial markets. It will prevent a great deal of instability and uncertainty that threatened our credit markets, that could do great damage to our economy. And so that's what we're focused on right now, and we'll see where the future goes from there. Read more Comment (0), Email this.

MR. FRATTO: We work very closely with Treasury. Read more Comment (0), Email this.

MR. FRATTO: It's a complex -- it is an incredibly complex problem. And I think you can see that Treasury was dealing with some very difficult issues: the failure of a major investment bank, the failure of the world's largest insurance company, the failure of two government-sponsored enterprises that needed to go into conservatorship. I think Treasury was ahead of this, but -- I think we said this last week, your first choice isn't a $700-billion-program commitment of taxpayer dollars. That is, I think, a last choice, a major government intervention into the financial sector. That's not what you lead with. You see if there are ways that we can try to contain the problem. That's what Treasury and the Fed tried to do. It had some limited success. But we've seen an incredible transformation in our financial sector right now.

But we're in -- we're in a point where because of the tightness in credit, the extreme illiquidity in credit markets, that something major had to be done. And it was the decision of Secretary Paulson. Read more Comment (0), Email this.

MR. FRATTO: No. No, the Treasury -- the Treasury was aware of a lot of different potential solutions, and this was one of them. Read more Comment (0), Email this.

MR. FRATTO: I don't know about a year ago, if that's what they -- if that's what they've told you. But I know that they were looking at different ideas for a long time. But I -- still, I think the point that I made is the right point. You don't -- you don't do this kind of major intervention as a first choice. Read more Comment (0), Email this.

MR. FRATTO: They were warning the public. And they were talking a great deal about the problems in credit markets. And I know it's something Secretary Paulson had been focused on for a great deal of time. And in particular, his focus on Fannie Mae and Freddie Mac as the -- one of the largest players in mortgage backed securities, he had been focused on that for a great deal of time. The administration had been focused on it for six years, even long before the Secretary came to Treasury.

April. Read more Comment (0), Email this.

Q Tony, you said you're hoping that this bill will have a large impact; it's a 110-page bill. But

MR. FRATTO: That's -- I know there's a fascination with what -- Read more Comment (0), Email this.

MR. FRATTO: Well, with -- whether you use the word or not, we've been through this question and answer for a number of times over the past year. We don't put those labels on the economy until the official people who do that, the Bureau of Economic Analysis do it. And I know there are people who talk about different kinds of recessions, but what we're focused on right now in this week and today is to prevent a real crisis, a deepening of a crisis in our financial industry that could put us into a recession, whether we're in one or not. Read more Comment (0), Email this.

Q Okay, the reason why I bring that up, Tony, is because the President in his address to the nation

MR. FRATTO: That you didn't see -- Read more Comment (0), Email this.

MR. FRATTO: You saw much worse, actually.

Richard. Read more Comment (0), Email this.

MR. FRATTO: Our Legislative Affairs team and Treasury's Legislative Affairs team have been up on the Hill for almost around the clock for the past couple of weeks. They have a very good sense of which members out there are undecideds; which ones are leaning opposed; which ones are solidly opposed. And so they put together the list for the President to identify people that he can be persuasive with, and what their concerns were, and that maybe he can address them, and maybe if he learns a little bit more about their concerns if he can direct his staff at Treasury or elsewhere to get back with them or work with their staff before the vote so that they can make an informed vote. Maybe their concerns are easily addressed and he wanted to be able to speak to them personally that way.

Also, the Vice President and, as I said, Secretary Paulson and others here -- I think everyone with a phone -- is calling to see if we can shore up a member who may be skeptical of the proposal.

Yes, Paula. Read more Comment (0), Email this.

Q It's been estimated we already have between 1 and 1.5 million foreclosures, and that it could go

MR. FRATTO: Well, look, Paula, there are -- nobody wants to see anyone be foreclosed on in a home. But even in the best of times, you see average rates of 600,000 to 700,000 Americans who are -- their homes are foreclosed on. Not all of those numbers are actually people living in homes. A lot of -- some portion of those numbers are people who have second homes or bought investment and condominium properties that are foreclosed on.

But for those people who are living in their home and want to stay in that home, there are government programs -- there's the HOPE NOW Alliance, FHA Secure. This piece of legislation has foreclosure mitigation language in it that requires the Treasury Secretary to work with mortgage-holders to find a way to renegotiate their loan terms to stay in their homes.

So I think everyone has an interest in Americans who are in their home, who want to stay in their home, to be able to stay in their home, and to try to find creative ways for them to do that.

Now, there are some people out there who received loans who never should have received those loans. Their income could never support a loan for the property for which they were given a mortgage. And it's unfortunate that those people will lose their homes, and there are other options. You know, they can rent, but -- or find a more affordable home to live in. But it is not a monolithic population of Americans. Read more Comment (0), Email this.

Q But one of the national problems has been, particularly since housing has escalated, there is a

MR. FRATTO: I know that's something that HUD is focused on, and so I'll refer you to them for more. Read more Comment (0), Email this.

MR. FRATTO: I'm sorry? Read more Comment (0), Email this.

MR. FRATTO: Okay. Read more Comment (0), Email this.

Q One of the reasons there's so much outrage in this country is because of the multi-multi-million

MR. FRATTO: Yes, it depends on how they participate in the program. But I think I'll have to refer you to Treasury for details on how exactly that will work. But I think there are very strong measures in here to prevent the so-called "golden parachutes." I think Speaker Pelosi spoke to that last night. Read more Comment (0), Email this.

MR. FRATTO: I'm not sure that it's the CEO getting the government money. I know this was something that was part of the debate over the weekend with members, and informed a very big part of the debate, as they tried to determine the best way to do this that would not inhibit companies from coming in, but would still provide some measure of accountability on CEOs and senior corporate executive teams at financial firms that participate in this program.

I think it is pretty substantial. I think it's like nothing that you've seen before, except in the case of failed institutions where, when we come in with assistance, we actually clean out -- as you've seen it at Bear Stearns and others, where the entire management team is removed and shareholders are wiped out.

So I think it is pretty strong protections that Americans' tax dollars will not go to -- will not be a windfall for CEOs. Read more Comment (0), Email this.

MR. FRATTO: Right, and like I said, you might have to go to Treasury for the specific details on how that will work. Read more Comment (0), Email this.

MR. FRATTO: It is. Yes, high energy prices have been a drag on our economy, you're right.

Sheryl. Read more Comment (0), Email this.

Q Tony, last week in the President's speech, he put the consequences of inaction on very personal

MR. FRATTO: Sure. Read more Comment (0), Email this.

MR. FRATTO: Sure. Yes, absolutely. I think that is a big part of the case is for everyone to understand. People have an image of this that this money is going to support executives on Wall Street, and what we're really trying to do is to fix a systemic problem in our economy.

By the way, it's a problem that already exists. We want to prevent it from getting much, much worse in a way that would shut down our economy. But you can go out and look at regional newspapers across the country and see what's happening with especially small businesses who may have more limited options for obtaining financing, and they are having difficult times getting the credit that they need to be efficient in operating their businesses. And some are not getting the credit at all. Read more Comment (0), Email this.

MR. FRATTO: Sure. Actually, I know -- I think SBA -- I think we put out a document -- I apologize, I don't have it with me; I can get it to you -- where we cited a number of the small businesses. You mean in terms of what the President might be saying? I think he's making that -- I can't give you a specific quote from what he might have said to a particular member, but he is making it clear that this is about Americans in their communities; that's what this is about. It's about family finances; it's about 401(k) retirement plans; it's about small businesses; it's about even larger businesses that do a great deal of hiring and are a strength in our economy, and we want to keep them strong. So that's certainly part of the message. Read more Comment (0), Email this.

MR. FRATTO: Okay, quick one. Read more Comment (0), Email this.

MR. FRATTO: Yes, I don't know Paulson or -- Read more Comment (0), Email this.

Read more Comment (0), Email this.

Read more Comment (0), Email this.

MS. PERINO: All right. I will have an update for you about the President's activities on the economy in a moment, so bear with me though, I have a couple of other things. The President at 2:05 p.m. today will have a secure video teleconference with PRT leaders, provincial reconstruction team leaders in Afghanistan, and President Karzai will join him for that. PRTs are helping to improve the lives of Afghan citizens, and they'll have a chance to hear about their progress.

Following that, the President will meet with President Karzai in the Oval Office. He looks forward to discussing with him the state of the international community's ongoing efforts to help improve security there and reconstruction in Afghanistan, as well as the governance of Afghanistan. And it will give them a chance to talk about the expansion of the Afghan National Army, the continued training of that army, and the strategic partnership talks.

Just for your -- just as a reminder, the two leaders last met in Egypt in May during the President's visit to the Middle East.

Also, at 4:20 p.m. today, as I told you yesterday, the President will meet with the Prime Minister of the United Kingdom, Gordon Brown. That will be in the Oval Office, and they will discuss the global economy; certainly Iran, Iraq, Afghanistan, Georgia, and other issues of shared concern.

At 7:00 p.m. this evening, the President and Mrs. Bush will attend the 2008 National Book Festival Gala performance and dinner. Both events are being held at the Library of Congress, Jefferson Building, here in Washington. There are approximately 400 guests and we can provide you more information, or the First Lady's office could, too, if you're going to have anything on that.

Also, we welcome the Senate's ratification yesterday evening of Albania's and Croatia's ascension to NATO. This step recognizes the tremendous progress made by these countries in recent years. Their membership in NATO, once ratification by other allies is completed, will be a great asset to the alliance. Both countries are already active participants in military operations, along with U.S. forces and those of our allies. The Senate vote underscores how these new democracies have helped to close a dark chapter in the history of the Balkans, and are making strides in ensuring the entire region is peaceful, democratic, and on the path toward full Euro-Atlantic integration.

We also hope to welcome Macedonia as a member of NATO as soon as the issue of its name is resolved, and to continue NATO's enlargement process to include other allies in the future.

Now, you heard from the President already this morning about the economy. I know you've been following the developments on Capitol Hill. Let me just give you a little bit of what is going on here at the White House to help bring this to a conclusion. The President has been talking with his senior advisors Josh Bolten, Joel Kaplan, Ed Gillespie, Dan Meyer, Keith Hennessey, Eddie Lazear, and others. The President spoke to the Republican leaders this morning, Mitch McConnell and John Boehner. He will be on the phone with other members today, I would expect, and I'll provide you updates as possible throughout the day.

Josh Bolten and Joel Kaplan have been on the phone regularly with members of Congress, as well. The President instructed his legislative affairs team and his economic policy advisors here at the White House and at Treasury to keep working with Congress. Keith Hennessey, the Director of the National Economic Council, is on the Hill right now meeting with members. He's also been on the phone with members to discuss the policy options and the concerns and trying to find a way that we can resolve them.

Dan Meyer, who is the Assistant to the President for Legislative Affairs, was in the meeting last night on Capitol Hill. He was up there again this morning, and his staff, John Emling and Chris Frech are also up there working with members to address their concerns. Secretary Paulson is also on the Hill, and he's calling in providing updates to Joel Kaplan and Josh Bolten and to the President, as well. He was also meeting with members, and then working the phones last night.

So we have a lot of work to do, but I think things are continuing to head in the right direction. One thing we know is that everyone understands the urgency with which we need to get something done. Read more Comment (0), Email this.

MS. PERINO: As the President wanted them to do yesterday, is to listen to the concern and see if there were areas that we could find compromise that would still allow the plan to work. So I don't have the nitty-gritty details on what they are, but the President has said let's listen to their concerns.

We've already come their way on a few things, on both the Republicans' and the Democrats' side. For example, when we put out the legislation last Saturday, which was an outline, we asked for their feedback. One of the things that understandably people wanted to have was more transparency and oversight. So we are willing to work with them on that. I think there are still some modifications that some of the members would like to see in that regard. We're willing to look at them.

In addition to that, there's the issue of executive compensation, and should there be limits for companies whose CEOs participate in this program. And Hank Paulson is trying to work with his team on the details as to what that would look like. Read more Comment (0), Email this.

MS. PERINO: I think that's the way I would describe it. There are some alternatives and variations to what we had proposed that have come forward. What the President said he would do is at the end of the day, when this legislation is crafted, that he would look to his Secretary of the Treasury and Ben Bernanke, the Fed Chairman, and he would ask them one question: Does this legislation do what needs to be done in order to help save the economy? And if the answer is yes, then we'll all have done our duty on behalf of the American people.

So that's the -- that is the spirit with which we have gone forward with these negotiations. And we're trying to reach a conclusion that would also solve the problem. Read more Comment (0), Email this.

MS. PERINO: Well, I would disagree that it fell apart at the White House. The President invited the leaders and both presidential candidates to come to the White House yesterday, gave them an opportunity to each have the floor to express any concerns. I would say the meeting was very constructive -- the large majority of it.

There's obviously concerns -- we've asked Congress to do something huge. We've asked them to bite off a lot and to pass some -- pass a massive package in a very short amount of time. And they've worked very hard. They had hearings quickly; they've educated their members. And the President thanked all of them. The members thanked the President for the speech that he gave Wednesday night, which they thought helped.

Now, there are alternatives and variations that some House Republican members have wanted to put forward, and Speaker Pelosi has been very clear that she wants to see a certain number of Republican votes. And John Boehner is working very hard to find -- to figure out a way, how can my members' considerations and concerns be included in this package in a way that will still solve the problem? So that's what they're working towards.

Yesterday afternoon was something that I think was -- it was a good moment for everyone to vent their frustrations, as well, if they had them. But I think what you see today, from the reaction of the members of Congress who left here, went back to Capitol Hill and worked until late into the evening -- they brought their staffs back in early this morning, and they're going to have further negotiations today. They all understand that they can get it done, and I appreciate that Senator Reid said that he doesn't see any reason why we couldn't get this done before opening bell on Monday. Read more Comment (0), Email this.

MS. PERINO: I'm just going to say it's important that we get it done as quickly as possible. Secretary Paulson has talked about the concerns across the board with the economy, but certainly with the credit markets that have shown troubling signs of tightening up even more in the past several days. And what that means is that it hurts everybody down the food chain. It hurts people who are trying to get loans for their homes or their businesses; you can't grow your business -- everything that freezes up. And if no one in the financial community trusts each other to lend money, then we're going to have a complete and total financial collapse. And that's what we're trying to -- that's what we're trying to prevent.

So I would say it's critical we get it done quickly. I appreciate that Senator Reid said that they think they can get it done before opening bell on Monday. Read more Comment (0), Email this.

MS. PERINO: Well, what I -- I'll tell you once again, this is what the President is going to do. He's going to continue to work with the members of Congress. He has a staff up there working with them very closely. And once it's finished and once there's a deal, the President will turn to Secretary Paulson and say, does this solve the problem?

I don't think there's any member of Congress that doesn't want the package ultimately to solve the problem, which is why they're all working so hard today. Read more Comment (0), Email this.

MS. PERINO: Look, we're just going to keep -- we are going to keep working at it. We don't have any reason to believe that we can't get it done by Monday. Read more Comment (0), Email this.

MS. PERINO: Look, I don't think that there's -- Read more Comment (0), Email this.

MS. PERINO: I think that I'd be careful. We don't know all the details and all the discussions that are ongoing, because we are not negotiating in the press. So I don't know exactly how Republicans are framing this and putting forward their considerations. I know that Minority Leader Boehner has just sent a letter to Speaker Pelosi that outlines some of their concerns and asks for consideration. We will be considering those issues, too. And that's what we're doing up there right now. Read more Comment (0), Email this.

MS. PERINO: I don't know that anybody up there on the Hill thinks that the insurance suggestion would take over the whole program. So I think we just need to let the negotiators continue to work it out. Read more Comment (0), Email this.

MS. PERINO: I'm going to go to Elaine. Read more Comment (0), Email this.

Q Dana, Senator McCain is heading to the debate now -- it's been announced, it's official. First

MS. PERINO: I think you'll be very dissatisfied with my answer, that I'm going to let Senator McCain and political pundits decide what it means. But I think what I would point you to is the public comments from Senators Reid, Senator Gregg, and the fact that the President has his whole team with all hands on deck to make sure that we get this solved. Read more Comment (0), Email this.

MS. PERINO: What we've said is that if the two presidential candidates -- since we're trying to pass this massive package in the middle of a presidential election -- that if their participation in the meeting yesterday could help finalize things, that that would be for the better. I'll let others decide and analyze, and once it's all finished, everybody can take a look back and see if it was helpful or not. I do think it was actually very useful for everyone to be able to meet yesterday with the President of the United States, talk about the discussions they've had over the past several days and where they needed to go to drive this to a conclusion, and the President was very clear that there's going to be one test for this legislation: Does Secretary Paulson and does Ben Bernanke believe that this will solve the problem?

And that's -- so that's the framework everyone is driving towards. Read more Comment (0), Email this.

MS. PERINO: I don't know. I couldn't tell you what his -- Read more Comment (0), Email this.

MS. PERINO: Senator Reid said the same thing; so did Senator Gregg. And I'm going to let the negotiators continue. As I said, we've been -- we feel like we've been close, but we're not quite there yet. There are many members of Congress, especially on the House Republican side, who have a lot of concerns, and I understand those concerns. We get it. This President did not want to have to take this route, either. But it was after being briefed repeatedly by his Secretary of the Treasury and his Fed Chairman that if we did not do something drastic, that we would have -- we would be facing financial calamity, that the President of the United States said we can't sit by and let that happen. If we have a way that could fix it and to stabilize and strengthen the financial markets, we have an obligation to do that. Read more Comment (0), Email this.

MS. PERINO: I just don't know. But I think it'll be fun to watch. (Laughter.) Read more Comment (0), Email this.

MS. PERINO: I don't have a take on it. We're focused on trying to get the legislation done, and I'll let political reporters like yourself, or pundits, decide. Read more Comment (0), Email this.

MS. PERINO: What I just said is that I think that it was useful to have everybody at the table yesterday so that we knew where we stood and that we could go forward and try to get a deal. Read more Comment (0), Email this.

MS. PERINO: Yes, yes. That's what we've said before.

Go ahead. Read more Comment (0), Email this.

Q Dana, you mentioned in your opening remarks that the President called the leaders Boehner and McConnell

MS. PERINO: I'll have to get back to you, because I don't know who all he might have seen over the past week. But those are -- he's trying to work with the leadership as they try to manage their caucuses. Read more Comment (0), Email this.

MS. PERINO: The President understands that a lot of them have reservations -- even about the concept, about the government intervening in the free market. He had the same instinct. But he believes that with the education that he got and then the ones that he -- what we have provided to members of Congress, that they understand that we should -- we cannot stand by and just let this happen if we have a way to try to fix it.

You'll recall that this President has been -- has shown bold leadership on many different issues. And there have been a couple of them that come to mind where not all the House Republicans were with the President. Not all the Senate Republicans were with the President on issues. But he has led on important issues like Social Security, immigration, and now this one, where we try to help drive to a conclusion.

The President believed in the urgency of Social Security and immigration, but they pale in comparison to the urgency of this package. Read more Comment (0), Email this.

MS. PERINO: Well, here in our own country we know that we need to improve our regulatory system. We're dealing in the 21st century with something that was designed ad hoc in the 1930s and not in a systemic way. So we need a systemic solution to the immediate problem, and then we need to look at the regulations.

As we've said, President Bush -- and even going back to President Clinton -- they tried to deal with the Fannie Mae and Freddie Mac issue in a way that was not receptive by members of Congress, both led by Republicans and led by Democrats. We finally got legislation when we were in the middle of a major crisis just this past August. There's going to be a time and a place for us to go forward with regulations. I would submit to you that Secretary Paulson has a very good blueprint that he recommended last spring; unfortunately, it fell on deaf ears. But I think now people have woken up and will start having hearings on that as soon as they can. Read more Comment (0), Email this.

MS. PERINO: Right. Read more Comment (0), Email this.

MS. PERINO: Let's let them have the meeting today and find out. I think that the G7 ministers have had good conversations; they've been very supportive of the action that we have been trying to take over the past week. So let's -- let us have the meeting today and then we'll see if there's any more we can add.

Go ahead, Roger. Read more Comment (0), Email this.

MS. PERINO: I think I just told Mike -- he's talked to the -- he's been working through the leadership, but I'll check and see if there's been any other contact.

But let me just point out I'm sure Secretary of the Treasury has; Josh Bolten or Joel Kaplan could have talked to them, as well, but I just don't know.

Go ahead. Read more Comment (0), Email this.

Q Dana, I think a couple things everybody agrees on is that the root of this problem and the downward

MS. PERINO: And your question? Read more Comment (0), Email this.

MS. PERINO: Those are the very problems that we're trying to solve. And I think if you look at the reaction that we had from the vast majority of people who have looked at this problem, who understand it, think that we have a package that could help stabilize the markets. That's what we're trying to do. Read more Comment (0), Email this.

MS. PERINO: Well, why would we go forward with a plan that we didn't think would fix it? Read more Comment (0), Email this.

MS. PERINO: Looking at -- I trust that Secretary Paulson and Ben Bernanke and all the experts that they are working with, and the members on Capitol Hill and their very experienced staff, are all working towards trying to make sure that we get the right package.

Mark. Read more Comment (0), Email this.

MS. PERINO: Okay. Read more Comment (0), Email this.

MS. PERINO: I have not heard that, so let me check. That might be coming out of the U.N. Read more Comment (0), Email this.

MS. PERINO: Okay, I'll check. Obviously we've been working very hard. I know the President plans to talk to Gordon Brown about Iran today and we've been trying to make the point to our U.N. Security Council partners that we have to continue to push forward to respond to Iran's non-response; that there are negative consequences for not answers the demands of the international community. So I will check. Read more Comment (0), Email this.

MS. PERINO: Look, I -- one of the things that's very difficult about this situation is that we are dealing with a major crisis in the middle of presidential election. I've worked very hard to navigate a path where I'm not inserting myself into presidential politics, and I think that Senator Reid -- I'll just let him speak for himself and I'll let political analysts or reporters like yourself try to ferret out whether they think it was a good or a bad thing to have the meeting.

I think we -- from our perspective, we think it was a good thing to have everyone there. The President opened it up so that everybody would have a chance to speak. Senator Obama and Senator McCain both had a chance to talk about their views last night in the meeting. And ultimately, I think that it will be helpful, because we're going to get to a conclusion hopefully sooner than later. Read more Comment (0), Email this.

MS. PERINO: Oh, I wouldn't -- I haven't said what anybody said in the meeting. Go ahead, Connie. Read more Comment (0), Email this.

MS. PERINO: You missed the top of the briefing, so I'll give you that -- so, no, I'm not going to provide any detail. The President will talk to him about the global financial -- I'm sorry, the -- America's financial crisis, which threatens the rest of the world. And I think everyone recognizes that, especially the G7 ministers.

And the members of -- the heads of state that the President saw up at the U.N., from developing countries to developed countries, all were focused on this issue, wanted to know what America was doing, and that's why the President addressed it up at the U.N. Let me let Gordon Brown and the President have their meeting, and we'll provide a readout. Read more Comment (0), Email this.

MS. PERINO: I think we're holding up just fine. I mean, look, we understand that this is -- this is the time when everyone needs to pull together, work extremely hard. We're working hard here, but so are members of Congress and their staffs, people at the Treasury Department and the Fed and the SEC.

So everybody's working hard, because this is a moment where you need to rise to the occasion and get something done. Read more Comment (0), Email this.

MS. PERINO: Am I worried about my future? I'm not worried about my future.

Goyal. Read more Comment (0), Email this.

Q Dana, two quick questions. One, as far as Prime Minister of India's meeting with the President

MS. PERINO: We hope so. And we're trying to work with members of Congress to see if we can get it done before they adjourn. Read more Comment (0), Email this.

Q And second, as far as President's meeting with Afghanistan's President, and also he met with the

MS. PERINO: President Zardari and President Bush both agreed that we need to continue cooperation, that we are friends, that we respect their sovereignty, we respect their democracy. We also recognize that the common enemy is al Qaeda and the terrorists. And it is -- it became very clear there when the President talked about Prime Minister Bhutto, the late Prime Minister Bhutto who was killed by terrorists, that President Zardari and the rest of his team understand what they're up against.

We're going to continue to push them, we're going to cooperate with them, and we're going to make sure that we repel this threat.

Did you have one? Read more Comment (0), Email this.

MS. PERINO: Okay. Sure. Read more Comment (0), Email this.

MS. PERINO: I think that -- I would refer you to the Department of Defense for an explanation about all the details yesterday about the -- about a mile away, there was flares -- I'll let Department of Defense explain that. We're talking with them and communicating with them and we'll try to provide you timely information as well as we can. But what I will tell you is that President Zardari and President Bush pledged their commitment to work together.

Deb. Read more Comment (0), Email this.

MS. PERINO: I think history will be the judge, but what I have said is I think that overall, at the end of the day, having the meeting allowed everyone to realize where we were in the negotiations and what needed to be done to help finish the discussions. Read more Comment (0), Email this.

MS. PERINO: I wouldn't call it -- I wouldn't say that the President was surprised, because he's kept regularly updated. I think that he is concerned that they feel like their concerns, their alternatives, their variations on the proposal have been listened to. We've tried to accommodate them in some ways, but the President also understands that fundamentally, at their core, they probably do not want to support this plan.

A lot of people don't want to deal with this. No one's happy about having to do this. No one wants to do this right before an election. Nobody wants to do this, because they want to be out on the campaign trail. But there are times in America when you put aside partisan differences and you come together and you try to find the best package in order to help Americans. That's what we're trying to do today, and I think Republicans -- Read more Comment (0), Email this.

MS. PERINO: No, I think -- I couldn't describe it either way. I mean, this is a huge issue with -- to use Paula's word, it's uncharted territory. It's not something that we have dealt with before in our country's history, so I don't think that there's -- you don't have anything to compare it to. I think that's what I'd say.

Okay? Read more Comment (0), Email this.

MS. PERINO: As I said, we're going to continue to work with them.

Let me go back here. Go ahead. Read more Comment (0), Email this.

Q Yes, I just wanted -- McCain put out a statement saying that -- excuse me -- the McCain campaign

MS. PERINO: I'm not going to characterize it. Let me put it to you this way, having been there: I think everybody there was constructive and focused on trying to find a solution. Read more Comment (0), Email this.

MS. PERINO: I'm just saying that -- this is from my perspective, from where I sat. I'm sure that during a political season, there's going to be political rhetoric that goes back and forth. I'll let all of you sort that out. I'm just not going to get in the middle of it. I don't think it's appropriate for me to from this podium. And I think that the most important thing that we can do from the White House on behalf of all Americans is continue to focus and get this package done.

Roger. Read more Comment (0), Email this.

MS. PERINO: Good morning. Very busy day at the White House. I'm going to give you a couple of points. The President had a meeting with the President of Lebanon earlier that you were there for. He also signed the Americans With Disabilities Act of 1990 Amendments of 2008. He then met with the Orthodox Union Leadership to acknowledge the 110th anniversary of the Orthodox Union's founding, and wished the Jewish people a very happy New Year.

At 1:15 p.m. this afternoon, the President will meet with the President of the Palestinian Authority, President Abbas. He looks forward to discussing the progress made toward building Palestinian institutions and toward realizing the vision of two states, Israel and Palestine, living side by side in peace and security.

And then he will have a meeting with bicameral, bipartisan members of Congress, as well as the two Senators who are running for President, Senators McCain and Senator Obama. The President looks forward to this meeting. He announced it last night in his address -- I'm sure we'll have plenty of questions on that today, so I'll stop there.

This evening, the President will meet with the Prime Minister of India, Prime Minister Singh, following which they will have dinner together in the Old Family Dining Room. The President intends to strengthen the strategic partnership and build upon our progress in other areas of cooperation, such as agriculture and jobs, education, trade, and defense. This meeting comes after the approval* of the U.S.-India agreement for peaceful nuclear cooperation. The conclusion of this agreement has been a priority for both President Bush and Prime Minister Singh, and strengthens the U.S.-India strategic relationship.

Two announcements. A scheduling update: Tomorrow President Bush will meet with Prime Minister Brown, Gordon Brown, in the Oval Office. The Prime Minister and the President will discuss the global economy, Iran, Iraq, Afghanistan, Georgia, and other strategic issues of shared concern.

And in addition to that, I have another scheduling announcement, that the President will welcome President Viktor Yushchenko of Ukraine to the White House on September 29, 2008. The President and President Yushchenko will discuss how to reenforce democracy, security, and national sovereignty in Ukraine and throughout the region, and steps to advance Ukraine's efforts to integrate into the Euro-Atlantic community.

With that, I'll take your questions. Go ahead, Deb. Read more Comment (0), Email this.

MS. PERINO: No, there's a lot of action up on the Hill. The President appreciates how members of Congress have pulled together to take on a very big issue. We have asked members of Congress to bite off a lot, but it's not more than any of us can chew. So what we'll do at the 5:00 p.m. meeting is have every -- I'm sorry -- 4:00 p.m. meeting, have everybody get together and hopefully start driving to a conclusion.

I can't tell you if we would have a final deal by then, or if it would emerge right after that. We'll have to see. But we think that the participation of the two candidates could help us in resolving this situation. I think that anybody who's looking at our -- the credit markets overnight understands the concern that we have for the economy and how important it is that we try to move quickly today. So this meeting is a chance for everyone to come together and try to reach a solution, which is what they've been trying to do and we really appreciate the bipartisan spirit that people have approached this with. Read more Comment (0), Email this.

MS. PERINO: I think I did yesterday, but I'll be happy to go through it again. Read more Comment (0), Email this.

MS. PERINO: Well, we have said from the beginning that we wanted to work in a bipartisan fashion, and we have been. Remember the President last Friday announced this plan in a Rose Garden ceremony here at the White House. And then over the weekend, we worked with members of both parties on the legislation over the weekend and continued to have -- through the early part of this week as members of Congress held their hearings.

Yesterday, as you know, Senator McCain called the President shortly before he made the announcement that he would be suspending his campaign and that he was going to call on the President to bring a group together so that we could try to reach a solution. After conferring with the team here I was able to tell you that, one, we welcome Senator McCain's announcement, and then later on the President was able to organize everyone's schedules so that we could invite everybody down.

And we think that we have been making significant bipartisan progress on this legislation, but it -- that if the participation of the two Senators can help us finalize this situation, then that's all for the better. Read more Comment (0), Email this.

MS. PERINO: Well, I think that you -- if you look at some of the commentary that was coming out from people on background -- nobody was really willing to go on the record -- but they were all looking at each other. We're in the middle of an election campaign, there's no doubt about it. It's dominating our coverage and it was starting to seep into the debate. And even though people wanted to work in a bipartisan fashion, the thought was that bringing these two candidates together would actually help finalize the framework that we were closing in on, and we think that that's all for the better. Read more Comment (0), Email this.

MS. PERINO: Senator McCain is the one who called for the meeting and we thought that it was a good idea. And I think that everybody who is coming today thinks that it was -- it's a good idea. But certainly I would say that members from both sides of the aisle and both Houses of Congress and both of the candidates have recognized the urgency with which we need to move, and they've been trying to work together. So if this meeting can help bring it to conclusion, that will help us, too. Read more Comment (0), Email this.

MS. PERINO: Well, I think that having everybody on the same page and here, airing out the final issues that we have to deal with could help us finalize it and get it to a vote. Read more Comment (0), Email this.

MS. PERINO: I wouldn't say that. I think it's impossible to say. I wouldn't say that we could get one before or after; I just don't know. What I do know is that it is urgent that we get it done. Read more Comment (0), Email this.

MS. PERINO: No, I think it is, and that's why -- that's part of the legislative process. And the President now can bring everybody together after they've hashed through a lot of the issues and had their hearings and invited our -- members of the administration to come up, talk with them. We've been in the room, working with staff on details of the legislation, accepting some of their recommendations, pushing back on others.

For example, on executive compensation, I think we all understand the sentiment that executives should not have a windfall based on something that was a failure. And so -- but Secretary Paulson knows how important it is to get those details exactly right, so he's trying to work on the language so it would be what we -- enough of what we need in order to get the legislation done, and in a way that will protect the taxpayers. So those are -- that's one of the things that we're working on.

So we can do that up on the Hill. But I think this meeting is a way to bring everybody together, bring all the pieces together, everyone in one room with the President of the United States, who gave an address to the nation last night to talk about how dire the situation is and how we need to move urgently. And he's really appreciative of the bipartisan cooperation that we've had so far. Read more Comment (0), Email this.

MS. PERINO: I didn't describe it that way, and I think that we need to let the meeting take place, and then I'll describe it for you. I don't know exactly how the meeting is going to play out. Read more Comment (0), Email this.

MS. PERINO: Well, I think we just need to see. I think it depends on progress that has been made up on the Hill up to now. And so with members of Congress meeting as we speak behind closed doors, I think it's just too early to say. Read more Comment (0), Email this.

MS. PERINO: I don't know. You mean during the -- at the pool at the top? I don't know. I'll check. Read more Comment (0), Email this.

MS. PERINO: I think that we've made significant progress. We're -- have a framework that we can try to close on, and we hope that we can get it done quickly. I think that it's in everyone's best interest for us to get it done.

This is where Wall Street intersects with Main Street. And we have a lot of work to do in a very short amount of time. And we really appreciate the cooperation that we've had from the candidates, from the leaders and from the chairmen, who have worked tirelessly over the past several days. This is to help not just financial institutions, but to help every single American, when it comes to their retirement accounts, college loans, their car loans, their homes, their very existence -- this is what we're trying to protect. Read more Comment (0), Email this.

MS. PERINO: I did not say it was the opposite. I said we are driving to a conclusion, we have a framework that we're moving forward. And I haven't seen his comments, and maybe he has information that I don't have that makes him think that this deal is almost dead. But I can tell you that members of Congress have been working together. I think if you have to look at other people's comments, that they understand the urgency.

Obviously, there's a lot of questions, and there should be. We should be held accountable, as should the members of Congress, for lots of different questions that members of Congress's constituents are asking them. But I think that everybody is going to -- coming to a place where they can get together this afternoon and, hopefully, close on a framework where we can get this legislation passed.

I think it's really important that we do it as quickly as possible. If you look at the credit markets that tightened up overnight, Secretary Paulson is extremely concerned about that situation. And I think it underscores the importance of moving quickly.

Elaine. Read more Comment (0), Email this.

Q Speaker Pelosi apparently said a short time ago on Capitol Hill that when she comes here this afternoon

MS. PERINO: Our position on the stimulus package has been that we don't necessarily think it's the right thing to do, but that we are open to listening. And I'm sure that President Bush will welcome her comments and take them into consideration. Read more Comment (0), Email this.

Q Because she's making the argument now that it's going to be very difficult to try to explain to

MS. PERINO: And I think that the point is that if we act on this legislation now, that scenario will not happen. And so I'll let her make her case to the President.

Go ahead, Mark. Read more Comment (0), Email this.

MS. PERINO: Well, I think, again, those are all details that are being worked out in the negotiations. I'm not going to negotiate from here. That's served me well in the past and I think I'll just continue to do that, as we work to finalize this legislation. What I would remember people is that this legislation would authorize the Secretary of the Treasury to buy assets up to $700 billion. The intent is that that -- then the United States taxpayer would, if we can hold them and then sell these assets back, that the United States taxpayer could either -- well, at least recoup a lot of the money, if not be made whole, in the future. We can't promise anything in terms of return on investment, but that's what -- that's one of the messages that we've been trying to drive and that we'll talk about this afternoon. Read more Comment (0), Email this.

MS. PERINO: Well, he -- I think he needs the authorities, and when it comes to the financial aspect of it of how much does he need, I think Secretary Paulson made the recommendation of $700 billion because that was his assessment of how much he thought that he would need. But one of the things that we have worked with Congress on and that members of Congress were able to help us improve upon was the transparency and oversight of this program. And the President said last night that we would support a bipartisan board who would work with the Secretary of the Treasury to make sure that the taxpayers are being protected. Read more Comment (0), Email this.

MS. PERINO: Well, from Secretary Paulson who had made the assessment that that's how much he needed. Read more Comment (0), Email this.

MS. PERINO: I'll the Secretary of the Treasury's office answer that in detail because all -- what I know is that they did an assessment of what they thought they would need to be able to get the system moving again because of all of these assets that were frozen, and that $700 billion was about the amount that he thought was going to be necessary. Read more Comment (0), Email this.

MS. PERINO: Well, again, I'll decline to negotiate here in the press. But what we have been doing is working with members of Congress, and we have made a few steps forward and they've come a few steps our way, so we're reaching a consensus. And we're going to try and drive that to a conclusion today.

Sheryl. Read more Comment (0), Email this.

Q Dana, on the Hill, one of the concerns among House Republicans seems to be that if they were to

MS. PERINO: I'm going to let -- I'll let The New York Times and the political reporters there hash that out and do the analysis. I'm not going to do that here. Read more Comment (0), Email this.

MS. PERINO: The President believes that it's important to try to get these two candidates together -- Read more Comment (0), Email this.

MS. PERINO: -- because if their participation can help drive this to a conclusion, that that would be for the better for all Americans. Read more Comment (0), Email this.

Q And also, in their conversations yesterday, in the President's conversations with Senator Obama

MS. PERINO: I wasn't there, I wasn't privy to the conversations, but I know that they were brief, but good conversations. So I don't know how much detail they could have gotten into.

Go ahead, Keith. Read more Comment (0), Email this.

MS. PERINO: Well, as I said, Keith, we've been working in a bipartisan fashion and it actually has been a good spirit of cooperation. Senator McCain had a good idea to try to bring everybody together. They were out on the campaign trail; they were willing to come back to Washington, and the President thought it was a good idea to take them up on it. Read more Comment (0), Email this.

MS. PERINO: With Senators McCain and Obama running for President? No. Read more Comment (0), Email this.

MS. PERINO: We don't have the corner market on all the good ideas, Keith. Read more Comment (0), Email this.

Q Well, I guess what I'm getting to is, isn't this somewhat politicizing it, because if a deal comes

MS. PERINO: I think you should look at it actually the other way, which is that to get the politics out of it and bring everybody together at the same time, at the same table, that would be a way to help all American people by helping us get this resolved today. Read more Comment (0), Email this.

MS. PERINO: I don't. I'll try to check, but I don't know.

Go ahead, April. Read more Comment (0), Email this.

MS. PERINO: Could I tell you about the conversation? I think I already did. Read more Comment (0), Email this.

Q I mean, can you -- can you give us more of the tick-tock? Can you tell us when, how, what? I mean

MS. PERINO: All right, well, as I said yesterday, and I'll say it again today, Senator McCain called the President shortly before he made his announcement that he was going to be suspending his campaign and that he was going to ask the President to call people together. The President took a little bit of time to think about that and he reached out -- well, the senior staff reached out to the staffs at the campaign to find out what their availability would be, if they would be coming back to Washington and would they be willing and available to meet. And Senator Obama's team said yes, and then the President called Senator Obama and the meeting was arranged.

I don't think there's much more to see than that. Read more Comment (0), Email this.

MS. PERINO: I'm not a freelancer, April. When I said that the President had invited the Senators to the White House, along with the bicameral, bipartisan leadership of Congress, of course, I was able to make that announcement -- Read more Comment (0), Email this.

MS. PERINO: I'm sorry? Read more Comment (0), Email this.

MS. PERINO: I'm making it very clear that we want this to be a bipartisan initiative. We don't think that this is a political event, we're not trying to make it a political event. I will go out of my way to say it again, that we want them to come here to be able to offer their ideas, and if their participation could help us save this American economy, then we're going to do it. Read more Comment (0), Email this.

MS. PERINO: Before he called the President and told him before he made his announcement? Read more Comment (0), Email this.

MS. PERINO: Yes -- I mean, no -- McCain called the President, but he did so beforehand. Read more Comment (0), Email this.

MS. PERINO: I believe so. I don't know if anybody was -- I believe so. I don't know all the phone calls that happened at the White House, but --

Jim. Read more Comment (0), Email this.

MS. PERINO: I'm not going to speculate. I don't know. Read more Comment (0), Email this.

MS. PERINO: At this point, it's water under the bridge and it doesn't matter because we're going to have the meeting and hopefully we'll have a deal, as well. Read more Comment (0), Email this.

MS. PERINO: I think it's an important meeting. Members of Congress have been working night and day along with the Treasury Department, the Fed Chairman, and the SEC and the White House to resolve differences, to craft the best possible bill. And this meeting is going to happen, and hopefully it will help. Read more Comment (0), Email this.

Q Dana, I wanted to follow something Yunji was asking you. McCain's words this morning were the

MS. PERINO: I'm saying we have made progress every day and we are closer today to a conclusion than we were yesterday. Read more Comment (0), Email this.

MS. PERINO: Okay, well, then there might be a difference of opinion. But what I'm telling you is the assessment that I have from our Legislative Affairs people -- that we certainly don't have a deal yet; there are a lot of issues in a very complicated bill that we're trying to do in a very short amount of time. Just imagine, Wall Street and Washington move on very different time frames. Wall Street moves very fast; Washington tends to move very slow. We're trying to ask them to move very quickly on something that is very complicated in which we are asking a lot of the American people. The President talked to the American people about that last night.

One thing that is for sure is that members of Congress from both sides of the aisle recognize the urgency with which we need to move. And so that's why we are starting to have -- develop a framework where we can get to a conclusion.

Go ahead. Read more Comment (0), Email this.

MS. PERINO: Okay. Read more Comment (0), Email this.

MS. PERINO: No, I'm going to stay on -- I'm going to go to Goyal. Go ahead, Goyal. I think we've exhausted this one. Read more Comment (0), Email this.

Q As far as the Prime Minister of India's visit to the White House this afternoon, his statement

MS. PERINO: We're talking about the 123 agreement. Read more Comment (0), Email this.

MS. PERINO: No, I don't know of anything that needed to be signed. We need to -- we have some work to do with Congress. But I think that's on the right track. Read more Comment (0), Email this.

Q And second, as far as the President's U.N. visit was concerned, as far as human rights are concerned

MS. PERINO: What's your question? Read more Comment (0), Email this.

MS. PERINO: I think that the President said the other day at the United Nations, that the U.N. as a body needs to reexamine the Human Rights Council and he would hope that they would look at a whole host of issues, including that one.

Andre. Read more Comment (0), Email this.

MS. PERINO: President Bush was able to see President Saakashvili at the Iraq coalition meeting on Tuesday afternoon -- Tuesday evening at the United Nations. And we'll let you know if there's additional meetings. Read more Comment (0), Email this.

MS. PERINO: Well, Secretary Rice met with Foreign Minister Lavrov yesterday, so -- Read more Comment (0), Email this.

MS. PERINO: I think that they are working -- I think Ambassador Fried has been talking with his counterpart. So I'm not aware of that, but I'd refer you to the State Department. Certainly if there's a freeze it's not come from here.

Go ahead. Read more Comment (0), Email this.

Q In this financial crisis, does the Bush government expect any help from foreign countries, especially

MS. PERINO: Well, what I would point you to is the G7 finance ministers, who have been working very closely with the Treasury and the Fed to pump money back into the system, and that actually happened last night. I don't know if Germany was a part of that or not. I'd have to refer you back to those authorities or to the Fed to see. I think that everyone recognizes the problem, and America, first and foremost, is trying to fix it here on our own.

Go ahead, Paula. Read more Comment (0), Email this.

Q I know there was a question on the estimate of this cost being maybe $700 billion. If you factor

MS. PERINO: Look, I'm not going to mix apples and oranges like you are. You're free to do that, but, look, the $700 billion that the Secretary of the Treasury has asked for first particular plan, for this particular legislation that's moving forward, it's not a spending program, it's an asset buying program. And we are not promising what the return on investment could be, but the American taxpayer will get money back once we are able to hold on to these assets and then sell them back into the system.

So I'm not going to get into the characterization as you did, but what I can tell you is that they're apples and oranges. Iraq is moving forward -- has made tremendous security gains, tremendous progress on political reconciliation, and that will be a benefit for generations to come, both here in the United States and in the Middle East. Read more Comment (0), Email this.

MS. PERINO: You know what, Paula, I am not going to comment on that. I think that you should call the McCain campaign and make sure that you fully understand what he was talking about. Senator McCain has been a strong supporter of our troops and of this war for the very reasons that I just said, for the benefit of the people of the United States and to develop the democracy in the heart of the Middle East. That was the point. And I actually would refer you to them, because I think that you are on the wrong track. Read more Comment (0), Email this.

MS. PERINO: Go ahead, Les, one question, okay? Read more Comment (0), Email this.

Q All right, one. This May 3, 2007 executive order of the President statement says, "H.R. 1592,

MS. PERINO: I think I'd have to take a look. I'm not familiar with that legislation.

We'll do one more from John, the last one. Read more Comment (0), Email this.

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MR. FRATTO: Okay, great, thank you, and thanks for coming on the line this morning. I just wanted to take an opportunity this morning to give you an update on where things stand right now with the effort to get legislation passed to help our credit markets right now and stabilize financial markets.

As you probably know, Secretary Paulson, Fed Chairman Bernanke and the Chairman of the SEC Chris Cox are all preparing to testify at Congress this morning -- I think that starts at about 9:30 a.m. -- so, obviously point to their testimony this morning, and I'm sure they'll have extensive Q&A.

Secretary Paulson and his team are still negotiating with members of Congress, with Senator Dodd and Financial Services -- House Financial Services Chairman Barney Frank. Those negotiations are still ongoing. I'm going to try to avoid getting in the way of those negotiations on some of the specific issues that you might have questions on, but be happy to take a lot of your questions.

The President is, as you know, up in New York. You probably just -- maybe saw the coverage of comments that he made before meeting with the Pakistani Prime Minister Zardari. He's up there for the U.N. General Assembly meetings. The President will be giving a speech to the General Assembly shortly. You can expect that he'll have some passage in there about the challenges that we're facing in our financial markets.

Obviously, the President said he's seeing lots of leaders up there. Many economies around the world are affected or even dependent on the U.S. economy, and so there's a great deal of interest in how we're dealing with it. And I think, as the President said, he wants to assure the other leaders of the world that we're working together in a bipartisan way to get this legislation passed, and there is a great sense of urgency to get this accomplished and get it done quickly.

The President spoke to Secretary Paulson also this morning, about a couple of hours ago, and Secretary Paulson updated the President on where things stand. The President is also staying in regular contact with his Chief of Staff Josh Bolten and Ed Gillespie here, and his other economic advisors, on the progress of the talks with Congress and the status of our financial markets this week.

I think it's clear to everyone, anyone who's been paying attention to the markets for the last couple of weeks, that our markets are dealing with some very serious challenges. One of those challenges that we're hearing from the market is a little bit of uncertainty as to how the policy response from Washington will take place; whether it will take place as quickly as needed. I think we want to be confident that it will get done this week; that we will come together in a bipartisan way; that there is sufficient leadership in the House and Senate and from the committee chairmen and ranking members in the Republican Party to get this thing done.

Obviously the legislative process can be bumpy sometimes and there are lots of members who, rightly, have questions about how a program like this will be implemented, and whether it's the best way. We believe it is the best way to solve this problem. It gets at the real, root cause of what has been affecting our markets and our broader economy for some time.

We also think it is, by far, the best way to tackle it in a comprehensive and robust way that will protect the American economy -- not just the financial institutions in New York, but the ability of our economy to get the financing they need to continue to operate businesses, to protect retirement accounts, to make sure that there's available liquidity and credit for home loans, for auto loans and consumer financing and student loans -- that this is the best way to do it. And as I think you'll hear Secretary Paulson say this morning, the best taxpayer protection plan we can have is to have stable markets where our financial institutions can function in a normal way.

This is not a step that we have taken lightly. It's a very big plan. It was something we felt we had no choice but to do at this point. But we're going to move forward with it with great confidence that it will have the impact that we expect it to have and to allow growth to continue in this economy. But it is critical that we move quickly, that we get a clean bill out of the Congress, and that market participants and the American people can see that Washington is acting on this problem in a very forthright way.

Some of the issues that have come up out there -- maybe I can just tackle them a little bit and maybe we can get into them a little bit more in your questions. First is this issue of how it impacts Main Street. I know that there's a -- the image out there that this is a rescue plan for Wall Street financial institutions. This is a rescue plan for the American economy. Our economy does not function properly unless we have well-functioning financial institutions.

What we saw last week was a freezing in our credit markets. This had very, very real impacts on numerous businesses around the country, even in just their ability to get overnight financing for their ongoing operations, to pay employees and to purchase equipment and the things that go into the products they make. That is a dire situation if our credit markets can freeze up that way.

There was some comment on -- out there about the need to do more for homeowners and, of course, we're talking to members of Congress about how this legislation impacts homeowners and mortgage markets. It will have a very positive impact for homeowners and mortgage markets. It will ensure that we have the mortgage financing availability in the system so that we can continue to go out and make home loans for Americans.

Remember that the root of this problem is the housing correction. We don't want to see housing finance freeze up or be restricted. We want to see increasing amounts of funds available for Americans who want to go out and begin to reduce the overhang of homes that we have out there in the market; but also just want to remind everyone that it was just recently that we passed a very large housing bill to help homeowners. We have a number of plans out there that are directed at preventing foreclosures.

And just very quickly, the third item is that we're hearing questions about transparency and oversight. Just want to say up front, transparency and oversight is very important to us. This is a very big program.* It's never been done before, and we will insist that there be very strong and robust transparent oversight and review of this program.

Let me stop there, and then I'll be happy to take any questions you have. Read more Comment (0), Email this.

MR. FRATTO: Hi, Ann. Read more Comment (0), Email this.

Q Hi. How does the President specifically address the concerns of Senator Shelby and others, both

MR. FRATTO: Well, I think the President is obviously aware of the concerns that are being raised by a number of members. He gets regular updates on them. Secretary Paulson is our point person on dealing with these issues and explaining them to members and staffs so that they fully understand the full scope of not only the policy response, but also the problem that we're dealing with.

We feel very strongly that this is a very comprehensive plan. It is not just this plan to deal with buybacks of these assets. The Treasury Secretary and Chairman Bernanke outlined a number of issues. We're talking to Senator Shelby and his staff. I would also note that the Vice President and Josh Bolten, Keith Hennessey, the Director of the National Economic Council, are up on the Hill today talking to lots of Republicans. They're addressing the Republican Study Committee this morning over on the House side. So we're trying to address all of the issues that are being raised, and I think once we have this conversation over the next day or two as we started over the weekend, I think people will see that this is the best way to proceed. Read more Comment (0), Email this.

MR. FRATTO: Yes. He's up there right now. Read more Comment (0), Email this.

MR. FRATTO: Hey, Olivier. Read more Comment (0), Email this.

MR. FRATTO: Well, you want to have a light hand in dealing with some of these issues. I mean, nobody -- not the President and no one believes that the first instinct should be to do a massive rescue plan involving hundreds of billions of dollars. We do that as a last resort. If you're going to commit upwards of $700 billion of taxpayer money to a problem, you better be pretty sure that you absolutely need to do it. So that was nobody's initial instinct to go forward with this kind of plan.

We wanted to see if there were ways to contain this problem in the financial markets, and to deal with it very directly with the root causes with a lot of the housing programs that we initiated, shoring up Fannie May and Freddie Mac, which took far longer than we certainly hoped. You've heard us talk about the fact that we've tried to shore up Fannie Mae and Freddie Mac for years now. And I'll remind you, going back to August of 2007, the President personally came out where he announced a number of housing related reforms that we were proposing, called on Congress to reform Fannie Mae and Freddie Mac. It took nearly a year to get the housing bill that he called for and the reform of Fannie Mae and Freddie Mac passed through Congress.

Now, we would have preferred that that happened a lot earlier, but that's what we were dealt with, and that's the way we were trying to deal with this issue. But it was nobody's instinct that you would go in with a very large plan involving hundreds of billions of dollars as a first resort. Read more Comment (0), Email this.

MR. FRATTO: I see the connection you're making with countries who have investments in U.S. assets, and I wouldn't limit yourself to that. There are lots of economies that are very, very interested in the health of the U.S. economy. This is a global economy that is interconnected, involving trillions of dollars of financial flows between countries, involving things like sovereign debt, which you mentioned, but also trillions of dollars in trade and private sector finance. And it's critical that that system works for our economy and for all the other economies.

The President mentioned that he's heard from some members and he expects to see more there. If there are any calls that we make specifically that we can read out, we will and we'll let you know. Read more Comment (0), Email this.

MR. FRATTO: Hey, Barb. Read more Comment (0), Email this.

MR. FRATTO: Like I said earlier, I'm not going to negotiate on the specifics of what oversight would encompass and what the specific mechanism would be. But I think everyone should understand that we fully recognize how important it is to have robust, transparent oversight of this program. We're asking the American taxpayer to essentially front an investment here that will help us fix the economy. As we've said, it involves a lot of money. We think we're going to be able to return a lot of that money to the American taxpayer over time, and get the benefit of stable markets and a better functioning American economy. But we understand that there is a lot of interest in how the program will be run, how effective it will be, what will be the safeguards in it, and we will -- we insist, as much as anybody does, on a robust system of oversight. Read more Comment (0), Email this.

Q Yes, Tony. The dollar has already taken a beating today, and the hype is that, of course, it's

MR. FRATTO: I'm just not going to comment on dollar policy. That's something that we let the -- the Treasury Secretary is the administration's spokesman on the dollar, and maybe he'll get that question this morning and can address it in an appropriate way.

But just to hit on two things. Number one, there should be no question out there that this plan will get done this week. There is bipartisan consensus that it needs to get done. We are negotiating over some elements of the plan, but we are very, very confident that it will get done this week. We believe it needs to get done this week, and that's our goal.

With respect to inflation, inflation is a monetary phenomenon. The Fed is focused on price stability, we have great confidence in Chairman Bernanke to address inflation and price stability. Read more Comment (0), Email this.