October 3, 2007

11:37 A.M. EDT

THE PRESIDENT: Thank you all. Thanks. Be seated, please. Thank you. Thanks for the warm welcome. Sit down. (Applause.) Thanks for coming. It's great to be back in your county again. Marion, I appreciate the invitation. I'd like to share some thoughts with you, and then I'd like to answer some of your questions if you got time -- because I do. (Laughter.)

I really appreciate the Lancaster Chamber of Commerce for giving me an opportunity to explain why I have made some of the decisions I have made. My job is a decision-making job. And as a result, I make a lot of decisions. And it's important for me to have an opportunity to speak to you and others who would be listening about the basis on which I have made decisions, to explain the philosophy behind some of the decisions I have made. And so I'm looking forward to your questions, and I thank you for giving me the opportunity to come and share them with you.

I'm sorry Laura is not with me. She's, by far, the better half of the Bush family. (Laughter.) And she's a -- she really is a remarkable woman. She -- when I married her she didn't like politics or politicians. (Laughter.) And now she's the First Lady of the United States. And she's come to realize what I understand: It doesn't take much to be able to put influence -- to influence somebody in a positive way. And so she -- she cares deeply about issues like malaria. She believes like I believe, that we can eliminate the scourge of malaria and save lives all around the world. She cares deeply about literacy. She cares deeply about making sure women have got good information to -- when it comes to healthy choices with their life so they don't suffer from heart ailment. She cares a lot about women in Afghanistan. She cares a lot because she's got a big heart, and I'm sure proud to call her "wife," and I think the country is lucky to have her as the First Lady. (Applause.)

I appreciate -- I want to thank Tom Baldrige, the President of the Chamber, and the officers of the Chamber, and the President-elect of the Chamber, and all the folks who make the Chamber work.

I do want to contradict Marion, which is a little -- shouldn't be doing in the first thing I say, but she said that because of me you're growing. No, it's because of you you're growing. See, it's because of the entrepreneurship and small business owners and hardworking people in Lancaster County that you're growing.

I'm going to spend a little bit of time talking about what is the proper relationship between the federal government and the risk-takers in society. But I just want to make sure you understand what I know, and that is prosperity occurs because people work hard and dream dreams, and work to fulfill those dreams. And so I congratulate you on the economic vitality of this region, Marion. Thank you for trying to give me credit where it's not due.

I also want to thank the Chryst family for welcoming us to this facility. This is -- Jay is the dad. He's expanded his business and he wisely turned it over to his daughter -- (laughter) -- Dana.

So I asked the Chryst -- I said, how are you organized, from a tax perspective? Dana said, we're a subchapter S. And the reason I bring that up to you is I'm going to talk a little bit about tax policy here in a minute, and when you cut individual income taxes, you cut taxes on a small business that's organized as a subchapter S corporation. And so I talk about tax cuts; I want you to be thinking about tax cuts not only for yourself, but tax cuts for small business owners.

Expansion of this business has provided people new opportunity employments -- new employment opportunities here in Lancaster County. You know, when you give a man more money in his pocket -- in this case, a woman more money in her pocket to expand a business, it -- they build new buildings. And when somebody builds a new building somebody has got to come and build the building. And when the building expanded it prevented [sic] additional opportunities for people to work. Tax cuts matter. I'm going to spend some time talking about it. I want to thank you for giving us a chance to come and use you all as an example -- and also the hall works.

I do want to thank Senator Arlen Specter for being here today. Mr. Senator, you didn't need to come. I'm honored you're here, and I'm sure the people of this county are honored you're here, too. Thanks for coming. (Applause.)

Finally, I appreciate the Congressman from this district, Congressman Joe Pitts. I appreciate you being here, Congressman, thank you. (Applause.) Sounds like you packed the audience with some of your family. (Laughter.)

Right before I walked in here, I had a chance to talk to some state troopers and thank them for their service to the community. These folks were first on the scene at the West Nickel Mines Amish School tragedy. I am constantly amazed that our country produces people -- decent, honorable people who are willing to serve. These folks had the ultimate challenge, which is to bring comfort to a hurting community. I thank you for what you've done, I thank you for what you're doing, and I thank you for what you will do. I am honored to be in the presence of the troopers who were there first on the scene. Thanks for coming. (Applause.)

I appreciate so very much, Krist Blank, joining us today. Mr. Blank, I'm honored you are here. I will tell you that, like a lot of Americans, I was deeply troubled when, you know, I found out that mothers and dads were grieving for the loss of their daughter. And I also was -- my soul and spirits were lifted when I read the stories about the forgiveness and compassion that the Amish community showed toward the shooter's family.

It was a remarkable statement of love and strength and commitment for people who had suffered so mightily to say to, you know, a widow and her children that we're able to overcome our grief and express our deep love for you. And so I want to thank you, sir, and your community for being such great examples of the compassion of the Lord. And I'm honored you're here. (Applause.)

Knowing him, he's sorry I even talked that way, see? He's a remarkable guy who told me something interesting. He said, I'm praying for you, Mr. President. This is not going to be a church service, I promise you. (Laughter.) But I will tell you that the prayers of the people matter a lot, they really do. And it's one of the most inspiring -- (applause.)

I want to talk a little bit about the environment necessary to continue economic growth. The job of this government is not to try to create wealth. The job of the government is to create fiscal policy such that people feel inspired or confident in risking capital. In other words, the job of government is to create an environment that encourages entrepreneurship. One of the issues that we're going to be facing in Washington, D.C. is how to spend your money. In other words, what do we do with the good money that we've -- the good money we've collected? How do we spend it?

And there's a -- there's a difference of opinion in Washington, D.C., right now. I've submitted my budget, the core principle of which is that we will do what it takes to defend our homeland and make sure our troops have what it takes to do their jobs -- (applause) -- and keep your taxes low by not raising them. And we showed the way forward on how to get to balance in the year 2012. In other words, you got to be fiscally responsible, set priorities with your money, and keep your taxes low.

The principle is, is that tax cuts inspire investment, encourage consumption and savings. In other words, the more money you have, as opposed to the government having, the more likely it is the local economies will grow. That's why I brought up the example of the S-CHIP [sic] corporation. When we cut taxes on everybody who pays taxes, we cut taxes on small businesses, too. And one of the principles on which I'm making decisions is I'd rather the Chrysts spending their money than the government spending their money. See, I think they know how to spend their money in such a way that their business will grow.

Now, there's a different approach in Washington. And folks have suggested that we increase spending. As a matter of fact, a five-year budget that's submitted by the current leadership of the Congress increases spending by $205 billion over five years, which would -- and so you say, that's fine, sounds good, all these programs sound wonderful. Except how you going to pay for it? That's the question I ask. How are you going to pay for the promises? And the answer is, raising taxes. And I think they're wrong to raise taxes on the American people. I know we don't need to raise taxes on the American people.

This economy has got in some difficulties when it comes to the housing markets, and the last thing we now need to do is raise taxes. See, taking money out of the economy at a time when the housing market is adjusting could exacerbate economic difficulties. And the role of government is to try to create an environment so that small businesses flourish and families can realize opportunities and dreams, and consumerism remains strong.

And so what you're going to see me making decisions this year is when they spend -- they try to increase taxes on you, I'll use the prerogative given to me under the Constitution, and I'm going to veto the tax bills. I'm going to -- (applause.)

I just vetoed a bill today, and I want to explain to you why. It's called S-CHIP -- Children's Health Insurance Policy. First of all, the intent of the S-CHIP legislation passed previous to my administration is to help poor children's families buy the children health care, or get them on health care. That's what it is intended to do. Poor children in America are covered by what's called Medicaid. We spend about -- this year -- about $35.5 billion on poor children's health insurance. So the first point I want to make to you is, a lot of your money is being spent to make sure poor children get help, medical help.

In other words, when they say, well, poor children aren't being covered in America, if that's what you're hearing on your TV screens, I'm telling you there's $35.5 billion worth of reasons not to believe that. And by the way, that Medicaid expenditures only accounts for children of the poor, it doesn't account for the mothers and fathers. So a lot of your money does go to help poor families with health insurance.

The S-CHIP program was supposed to help those poor families, the children of poor families have the ability to get health insurance for their children. I strongly support the program. I like the idea of helping those who are poor be able to get health coverage for their children. I supported it as governor, and I support it as President of the United States.

As a matter of fact, my budget -- the budget request I put in said, let's increase the spending to make sure that the program does what it's supposed to do: sign up poor children for S-CHIP. The problem is, is that the current program -- and by the way, there's about half a million children who are eligible who aren't signed up. So I said, why don't we focus on the poor children rather than expand the program beyond its initial intent.

I want to tell you a startling statistic, that based on their own states' projections -- in other words, this isn't a federal projection, it's the states saying this is what's happening -- states like New Jersey, Michigan, Minnesota, Rhode Island, Illinois and New Mexico spend more money on adults in the S-CHIP program than they do on children. In other words, the initial intent of the program is not being recognized, is not being met.

It is estimated by -- here's the thing, just so you know, this program expands coverage, federal coverage up to families earning $83,000 a year. That doesn't sound poor to me. The intent of the program was to focus on poor children, not adults or families earning up to $83,000 a year. It is estimated that if this program were to become law, one out of every three person that would subscribe to the new expanded S-CHIP would leave private insurance.

The policies of the government ought to be, help poor children and to focus on poor children. And the policies of the government ought to be, help people find private insurance, not federal coverage. And that's where the philosophical divide comes in. I happen to believe that what you're seeing when you expand eligibility for federal programs is the desire by some in Washington, D.C. to federalize health care. I don't think that's good for the country. I believe in private medicine. I believe in helping poor people -- which was the intent of S-CHIP, now being expanded beyond its initial intent. I also believe that the federal government should make it easier for people to afford private insurance. I don't want the federal government making decisions for doctors and customers. (Applause.)

That's why I believe strongly in health savings accounts or association health plans to help small business owners better afford insurance for their workers. That's why I believe we ought to change the federal tax code. You're disadvantaged if you work for a small business and/or an individual trying to buy insurance in the marketplace -- disadvantaged relative to somebody working for a large company. If you work for a large company, you get your health insurance after tax. If you buy insurance you have to pay -- no, you buy your insurance after taxes as an individual; you get your insurance pre-tax when you're working for a large corporation. You're at a disadvantage if you're an individual in the market place.

So I think we ought to change the tax code. I -- my view is, is that every family ought to get a $15,000 deduction off their income taxes, regardless of where they work, in order to help people better afford insurance in the marketplace. (Applause.)

So I want to share with you why I vetoed the bill this morning. Poor kids, first. Secondly, I believe in private medicine, not the federal government running the health care system. I do want Republicans and Democrats to come together to support a bill that focuses on the poor children. I'm more than willing to work with members of both parties from both Houses, and if they need a little more money in the bill to help us meet the objective of getting help for poor children, I'm more than willing to sit down with the leaders and find a way to do so.

So thanks for giving me a chance to discuss one of the many decisions I make as your President. Decision making requires a couple of things -- and then I'll answer some questions -- one: having a vision, having a set of beliefs, set of principles by which one makes decisions. You know, if you're constantly trying to make decisions based upon the latest poll or focus group, your decision making will be erratic. You got to have a core set of beliefs. I believe you spend your money better than the government spends. I believe that the system works better when there's more money in your hands.

And foreign policy, I believe in the universality of freedom. I believe that a gift -- (applause) -- I believe there's an Almighty and I believe a gift of the Almighty to each man, woman, and child on the face of the Earth is freedom. That's what I believe. And I believe it's in the interest of the United States of America to help people become free. That's how you yield the peace we all want. We want people to live in free societies.

And if you believe in the universality of freedom, it's in the interest of this country to act. That doesn't mean military operations. But it does mean, for example, relieving suffering. I also believe in the admonition, "To whom much is given, much is required." A lot has been given to the United States. I believe it's in our interests to help relieve needless deaths when it comes to mosquito bites around the world. I believe it's in our interests to help relieve the suffering of HIV/AIDS on the continent of Africa. It's in our interests to do so. It's part of the belief system that says, you know, that we have obligations and duties to ourself.

No, by relieving suffering overseas, not only do you lift the moral sights of our country, but it recognizes the reality of the world in which we live. When there's despondency, despair and hopelessness overseas, it can affect the security of the United States of America. And so I -- what I'm telling you is that I made a lot of decisions when it comes to your security and the peace of the world. And I did so based upon certain fundamental principles.

Secondly, it's important to delegate. There's a lot of action in Washington, D.C., believe me, and I've got a lot of decisions to make. And so I delegate to good people. I always tell Condi Rice, I want to remind you, Madam Secretary, who has the Ph.D. and who was the C student. (Laughter.) And I want to remind you who the advisor is and who the President is. (Laughter.) I got a lot of Ph.D.-types and smart people around me who come into the Oval Office and say, Mr. President, here's what's on my mind. And I listen carefully to their advice. But having gathered the device [sic], I decide, you know, I say, this is what we're going to do. And it's "yes, sir, Mr. President." And then we get after it, implement policy.

It's a joy to be your President. It's not only an honor, it's a joy, because I truly believe the decisions I am making will yield the peace we want and the prosperity that we all desire.

So now I'll be glad to answer some questions from you if you got any. If not, I can keep on blowing hot air until the time -- (laughter) -- until the time runs out.

Yes, sir.

Q -- (inaudible) -- follow opinion polls. You don't govern by opinion polls. And I really respect that -- (inaudible) --

THE PRESIDENT: Okay, thank you, sir. (Applause.) Yes, those same polls will tell you that they're worried about catastrophe in the Middle East affecting the security of the United States. In other words, you pretty well -- look, I'm not going to argue polls with you, but I will tell you this, sir -- first of all, if we have a troop in harm's way, they're going to have the best -- they're going to have what's necessary to -- so they can do their job. (Applause.)

And secondly, we are bringing troops home. General David Petraeus announced that he wasn't going to replace 2,200 Marines that were in Anbar province, and the reason why he didn't feel like he needed to replace them is because they were successful. They had done their job. Reconciliation is taking place. Normal people are beginning to step forward and say, we want to live in peace. Al Qaeda, that thought they were going to have Anbar as a safe haven, has been rejected by the local populace. And he believes, as do the Iraqis, that we can maintain security without 2,200 troops.

We're going to bring another brigade home by Christmas. So that's 5,700-troop reduction. General Petraeus, in his testimony, recommended to me -- a recommendation I accepted -- that we can get down to 15 brigades by July. That's 20 from 15.

And the reason I tell you this, sir, is I want to make a couple of points. One, if I didn't think the mission was necessary for our security, I wouldn't have our troops there. Secondly, if I didn't think we could succeed, I wouldn't have our troops there. I cannot look in the eye of a mother or father whose son or daughter is in combat and not believe that we can succeed, and it's necessary.

Secondly, I believe that it is very important for the Commander-in-Chief to take the advice of his military commanders very seriously. In my position, sir, I don't want our troops feeling like I'm making decisions based upon politics when their lives are at risk. I want our troops knowing that I'm making decisions on the considered judgment of our military, all aimed at accomplishing an objective, which is for a country in the heart of the Middle East to be able to govern, sustain itself, and serve as an ally against these extremists and radicals. (Applause.)

Let me give you my world view on this. Like you, I'd like them home. I really do. But my decisions have been based on my -- or at least my belief that what we're seeing is one of the -- a great ideological struggle between forces of ration -- rational behavior, decent people, lovers of liberty, versus radicals who have a belief system and they're willing to murder the innocent to achieve -- to advance their objectives. That's how I view it. I don't think you're a religious person if you murder the innocent to achieve political objectives. I think you're a person who is manipulative and cynical and willing to kill in the name of religion; I don't think you're religious.

Secondly, a lot of my decision making has been influenced by what happened on September the 11th, 2001. I vowed that day that I would do everything in my ability to protect you, and that I would -- I wouldn't tire -- I can't remember my exact words, but I would stay on the job. And that's exactly what I have been doing.

On the one hand, we're pursuing radicals and extremists through sharing of intelligence and through special operations and through working alliances to bring them to justice before they come and kill again. And I would remind you that the people that have swore allegiance to Osama bin Laden in Iraq wanted Anbar province as a safe haven from which to launch further attacks on the United States. And one of the great successes of this conflict has not only been to liberate 25 million people from the clutches of a brutal tyrant, but to make sure that Anbar province wasn't a safe haven for those who swore allegiance to Osama bin Laden.

But in the long run, the way to defeat ideological people is with a better ideology. And there's no better ideology than one based upon liberty. If you believe in the universality of liberty, then it shouldn't surprise you when 12 million people in Iraq went to the polls. They said, we've been given a chance to express our individual desires. And they went to the polls to vote.

We have been through these kind of conflicts in our history. We went through the conflict against communism and fascism. These wars play out differently. This war is really hard for the American people to understand because the enemy uses asymmetrical warfare. They use hundred-dollar weapons to destroy half-a-million-dollar vehicles -- which has got to, as a taxpayer, concern you. I understand that. I understand it.

But the struggle is just as intense today as it was in the '40s and the '50s. I must have told this story hundreds of times, that one of the most amazing aspects of my presidency was my relationship with the Prime Minister of Japan, Prime Minister Koizumi. What's amazing about it is that when my dad was 18, he signed up to fight the Japanese; they were the sworn enemy of the United States of America. Thousands of people died in that conflict. They attacked America -- the last time we were attacked, by the way, prior to September the 11th was Pearl Harbor. And 60 years later, I'm sitting at the table with the Prime Minister of Japan talking about peace; talking about how to help young democracies thrive in this ideological struggle, both of us knowing full well that the ultimate defeat of extremism in the name of an ideology that is dark is freedom -- is the light of freedom. And the amazing thing is, is that what happened was that Japan's form of government changed.

Liberty is transformative. Our one-time enemy is at the table talking about peace. And the same thing is going to happen in the Middle East. And it's going to be tough to get there and it's hard work. But you -- I've got faith in the transformative power of liberty. I believe that people want to be free. I believe a gift of the Almighty to each man, woman and child is freedom. And I believe, when given the chance people want to be free. And I firmly believe freedom yields the peace we want.

And so, sir, to answer your question, it's important we succeed, and it's important we support our troops. (Applause.) Thank you.

Yes, sir. I appreciate the question. Yes, they'll get it for you. I'm not going to read it right now. Go ahead.

Q Thank you. Hello. First, I appreciate you being here and being in this kind of forum to answer questions.

THE PRESIDENT: Thank you.

Q It helps me to have a better understanding of you as a person --

THE PRESIDENT: I hope so.

Q -- so thank you very much. Thanks. I have two questions, if I could. One is, can you talk about the farm bill and how it's going to help local farmers in this area? And then would you also talk about global warming and how the U.S. is being a leader in a worldwide effort to combat global warming? Thank you.

THE PRESIDENT: Thank you. Thanks, great question. First, on the farm bill. I believe it's in the interest of local farmers to have markets available to them. In other words, a core principle of any good farm policy is for the administration to work to open up markets. If you're good at something -- and we're really good at farming -- we want to be in a position to sell that which you grow overseas.

Secondly, I believe very strongly that programs that encourage overproduction are programs that need to be seriously evaluated. In other words, I'd rather you selling into existing markets than producing where there be no market. In other words, it's a combination -- look, I'm a safety-net person for farmers. I just want to make sure the safety net is a actual safety net, not a incentive for overproduction.

Thirdly, I strongly believe in the conservation title inherent in the farm bill, the last farm bill. This is a CRP program which says to farmers, look, we want to help you set aside part of your land that may not be good for farming, but would be good for habitat, soil conversation. It's really one of the -- I think one of the great accomplishments of this administration is to work with the farm community to have an advanced CRP program.

And that's kind of the inherent principles. The marketplace has worked for farmers. I also believe -- this is going to answer your global warming question, as well -- it's in the nation's interest to diversify away from hydrocarbons. Probably comes as a shock to you from a guy from Texas saying that. But it's -- dependence on oil creates national security issues. There's too many people who have got oil that may not like us.

Secondly, we import about 60 percent of our oil from overseas -- fortunately, most of it from -- a lot of it from Canada and Mexico. But it doesn't take much to disrupt an oil market, and therefore, we got an economic issue when it comes to dependency on oil. One terrorist attack on a major oil facility could cause the world price of oil to go up. There are new big consumers of hydrocarbons in the marketplace; China and India, as they're growing their economies, are creating additional demand relative to supply. And therefore, the price of gasoline goes up here in Lancaster County as these economies grow. And finally, dependency upon oil creates an environmental issue.

And so, therefore, one of the strategies that we're putting in place is -- and this happens to be beneficial for farmers -- is why don't we grow our way out of dependency on oil? Why don't we use, initially, corn as the feedstock for an ethanol industry that has gone from about a billion gallons a year, when I first became President, to over 6 billion gallons a year?

In other words -- and so what I'm beginning to tell you is -- what I am -- not beginning, what I am telling you is that we have a comprehensive strategy to deal with energy security and environmental quality at the same time. And the interesting dynamic that has taken place in the environmental debate is the two issues have now come -- come front and center at the same time. In other words, you can solve one, you can solve the other.

Now, in terms of the environment, my -- I gave a speech the other day in front of the major economies of the world. And the reason I asked the major economies of the world to come to the table is because there is no solution for global warming unless all the major economies, or the growing economies of the world come to the table. You can't have a -- one of the reasons I was against Kyoto was not because I'm not -- don't support, you know, good quality environmental policy? I didn't think it made sense to have policy that didn't include all the major economies, like China.

And so why don't we try this approach -- why don't we make sure that China comes to the table on this issue? And step one is we'll sit around the table and agree on a common goal about what the reductions of greenhouse gases ought to be over the first half of the next century. Because if you can get somebody to sign on to a goal, you then get somebody to recognize there's a problem, and then obligate them to come up with a solution. So that's part of the strategy.

Here at home there are three aspects of our economy that affect greenhouse gases. First, automobiles. And I just described to you the policy that I think is good to address our reliance upon oil, which also affects that aspect of our economy that -- where there's a lot of emissions, and that's the automobiles. We can't rely upon corn forever for ethanol. There are a lot of hog growers and cattle growers around that get a little nervous when the price of corn is going up the way it is. And so your government is spending a fair amount of money, of your money, to research cellulosic ethanol. And that's a fancy word for using corn chips or switchgrass to be able to be the feedstock for new ethanol production.

And smart people tell me we're pretty close. So some day it's very conceivable that the farmers around here are going to be growing switchgrass. And then you become energy producers. Or you can imagine if we can use wood chips as a source to be able to produce ethanol; then all of a sudden you got a lot of the places that grow pine trees become a part of the energy mix. It's very conceivable that we can reduce our energy, our gasoline usage by 20 percent over the next 10 years. As a matter of fact, I've asked Congress to put that into law, not as a voluntary standard, but a mandatory standard.

Secondly, electricity -- and so -- you know, the real question on this environmental issue is, can we have policies in place that enable us to grow our economies and at the same time protect the environment? And technology will enable us to do that. That was the other message I talked about at this conference. You don't have to shut down your economy in order to protect the environment.

Technology will enable us, for example, to generate electricity from coal, but have zero emissions. That's where we're headed. So we're spending a couple of billion dollars of your money on clean coal technology. The dream is to have a coal-fired plant that produces zero emissions. And the smart people tell me, that's coming.

And by the way, on automobiles, just -- you got me stuck on something I'm interested in -- automobiles, you're going to be driving your car with a battery, and so the first 40 miles -- this is going to be helpful for urban dwellers -- the first 40 miles will be driven on a battery charge. I feel like it's coming pretty quick, and your deal doesn't have to look like a golf cart, you know, it's going to look like a car -- (laughter) -- or a pick-up truck, you can drive a pick-up truck. (Laughter.) Well, they drive them in Texas. (Laughter.) You get your first 40 miles -- I'm not quite through. And it's a long answer, I'm sorry. It's called filibustering. (Laughter.)

The other thing is, is that we got to promote nuclear power. I am convinced that the plant designs today are safe. I know we have got to do research on how to burn down the spent fuel in order to make people comfortable that we can deal with the waste in a smart way. If you're an environmentalist and concerned about greenhouse gases, you got to be for nuclear power. Nuclear power enables the developed world and the developing world to generate, get a -- get cheap electricity without one iota of greenhouse gases.

And so we're talking to countries like China and India about a help -- how to help them develop a civilian nuclear power industry. And so the question that's got to be on your mind, I'm certain it is -- how they going to get the fuel? Do you really want a lot of people enriching? Well, there's a Nuclear Suppliers Group that does produce fuel -- we're one of them. And so my vision is, if you want to have your nuclear power plant, fine. The Nuclear Suppliers Group will provide you the fuel and will collect the spent fuel. And hopefully, as this new technology comes, we'll reprocess the spent fuel in a way that reduces the amount of spent fuel and the toxicity of the fuel.

And finally, there's -- the third aspect of greenhouse gases here at home is how do you -- you've got to build your buildings better, and building codes matter when it comes to the construction of buildings. And so there's the three-part strategy. And then the question is who develops the strategy for each country? Well, my attitude is we can develop our own strategy. See, we'll set the goal, work with other nations to set the goal, and we'll develop a strategy. We'll develop a strategy that meets the needs of the American economy. We'll develop a strategy that the American people are comfortable with, all aiming to achieve the international goal.

And anyway, it's a great question. I appreciate you asking it.

Yes, little guy, you got one?

Q Do you have any further plans on preventing illegal immigration?

THE PRESIDENT: Illegal immigration? Yes, I do. He said, do I have any plans to prevent illegal -- further plans. One is to double the Border Patrol. Two is to modernize the border. You know -- I know you've never been done there -- or maybe you have. I used to live close to the border and it's -- it is an expansive territory and it's hard to enforce. And you can't have a Border Patrol agent every quarter-mile. You got to have infrastructure, as well, to leverage the presence of Border Patrol.

And so we're modernizing it. We're getting some fencing and some automobile routes -- you get on the Arizona border, you can't tell what's border and what's not border. I mean, it's just desert. But we're beginning to clearly define the border, and we're beginning to have much more effective enforcement on the border.

The second aspect of the immigration policy that discouraged a lot of our Border Patrol and, frankly, discouraged a lot of Americans and made them believe that the government wasn't serious about enforcing the border is, oftentimes, we would find somebody trying to sneak into our country illegally and then release them. And the old policy was, check back in with your immigration court. The problem is, they weren't interested in checking back in with the immigration court, they were interested in working. And so it was called catch-and-release. We've ended that.

One of the things we did with the Congress over the last couple of years is increased the number of detention facilities and beds. So somebody gets caught sneaking into our country illegally would be held in detention, particularly if they're from a Central American country, for example, and they're being shipped home now, which sends a message back to Central America that it's not a free ride anymore. In other words, there is a cost of trying to come into the country.

Thirdly -- so it's modernization, increased manpower, and better policy in terms of enforcing law.

Now, I'm going to tell you my position on this, just so you know loud and clear. I don't think you can fully enforce the border like Americans expect unless you recognize that people are willing to do whatever it takes to sneak in here to do jobs Americans aren't willing to do. And therefore, I believe, as a integral part of border security, that we say to somebody, you can come here on a temporary basis in order to pick peaches, or to work in a chicken factory. In other words, there's a lot of jobs Americans aren't willing to do, but somebody else is willing to do it because they want to put food on the table for their families. And until we have a rational temporary guest worker program, people are going to sneak in.

I used to remind people, family values don't stop at the Rio Grande River. You got people who are worried about putting food on the table and are willing to get in the bottom of an 18-wheeler in 100-degree temperature because they're going to come and do a job many Americans don't want to do. So I fully believe that if you want to enforce the border and be humane, have a temporary worker program. Give people a chance to come with a tamper-proof ID card that says, you going to come for a limited period of time to do a job that somebody else isn't doing.

That, by the way, relieves the pressure off the employers. If you're a small business owner, you're somebody who is worried about it. If you're running a nursery here in Lancaster County, and somebody shows up to work, you're not in much of a position to determine whether or not that Social Security card somebody gives you is forged or not. And believe me, there is a whole forgery network around this immigration issue, just like there's a whole smuggling network around this immigration issue.

And so it's -- anyway, I put up an idea, and we tried to get it through Congress; it didn't work. And so, in the meantime, however, this border security initiative is still going on down there on the border. I'm constantly in touch with the person in charge. I said, here's what you said you're going to do; are you're doing it? That's one of the jobs of the President, is to hold people to account. I'm interested in results. I said, you're going to come in and check in with me on a regular basis to show me what's happening. And it's amazing what happens -- I'm sure you do this in your businesses -- you say, you show up and give me an accounting of what's taken place. Well, the same thing works in government. And so I'm watching carefully and we're implementing the will of the United States Congress on the border security.

Yes, sir.

Q -- (inaudible) --

THE PRESIDENT: Thank you.

Q Recently the federal government implemented the National Electric Transmission Corridors Project, whereby the federal government can step in and not only identify corridors where we need to increase transmission capabilities along the East Coast or the West Coast, for example, but oversee, if you will, what the state says. In other words, if a state is holding up the project, the federal government can come in and say, no, this is where it's going to go and this is how we're going to do that. Recently when the federal government has identified some of these corridors, the state's governors have come out against some of these corridors because they don't want to lose control. I'm just wondering what your opinion is on that.

THE PRESIDENT: It's a -- the issue, as well as whether or not the federal government has the right of eminent domain to put certain federal systems in place over the objections of state and landowners -- and I support it on a limited basis, so long as it achieves a national objective. And I think having modern communications and electricity wires is in the national interest.

Yes, ma'am.

Q -- (inaudible) --

THE PRESIDENT: Well, you raised your hand. (Laughter.) You didn't mean it? You want -- you want a little chance to collect the thoughts, you know? I mean we're talking national TV here, you know? (Laughter and applause.)

Q I actually wrote it down so I wouldn't get flustered.

THE PRESIDENT: Yes -- it didn't work. (Laughter.) It's just the President.

Q Exactly. Thank you for picking me. I work for -- (inaudible) -- and in the last two of your budgets you have attempted to eliminate the commodity -- (inaudible) -- program. -- (inaudible) --

THE PRESIDENT: Yes. (Laughter.) I did? Anyway -- (laughter.)

Q Yes, sir, you did.

THE PRESIDENT: I'm going to call the man responsible right when I get home. Anyway, go ahead.

Q Your Secretary of Agriculture came to visit us and we asked him about it, too.

THE PRESIDENT: And what did he say?

Q Not a lot.

THE PRESIDENT: Why did you ask that question? (Laughter.) Anyway.

Q With a half-a-million seniors who rely on this food, and the food stamp benefit for seniors who live in poverty, it comes nowhere near this benefit that they receive -- how do we make sure that our seniors have the food that they need?

THE PRESIDENT: Yes.

Q And what I would say is, you know, I mean, I just want to make this program -- (inaudible) --

THE PRESIDENT: Well, where do you get most of your food from in the food bank? Private donations, right?

Q Well, we're fortunate, yes.

THE PRESIDENT: Yes. That's the way it ought to be. Food banks ought to be supported through the generosity of individuals. And -- anyway, keep going. So that program --

Q The supplemental commodity food program -- there's nothing to replace it with. Food stamps aren't going to work and we're talking about folks who live in poverty --

THE PRESIDENT: Right.

Q They already made all the mistakes which they can't fix --

THE PRESIDENT: Yes, look, if somebody is poor, we want to help them. And the fundamental question is what's the proper balance between federal help and private help. And when it comes to food banks, look, I don't know the program. Maybe I shouldn't make this admission, maybe I should try to bull my way through. I don't know the program; I'm sorry. I'll be glad to look into it. But just from a philosophical perspective, one of the wonderful things about the country is when there's a need, the average citizen steps up and helps fill the need through private charity. And your program, I suspect, really functions well because the food bank is a dear cause for people. People say, how can I love my neighbor? Well, one way to love your neighbor is the food bank.

And the truth of the matter is I suspect that if seniors are suffering here in Lancaster County and you put out the call, people are going to help. And so I would -- I'll get your budget -- yes, leave your name, I'll get your budget question answered, because you'll be maybe surprised, not surprised -- I don't know all the budget lines. I tend to try to have the big picture. But it's big picture for you and I understand it. Thank you for your question. I will seriously find out for you.

Yes, ma'am.

Q Thank you very much. It's truly an honor to have a President come to our county.

THE PRESIDENT: Thank you.

Q I just wanted to ask you specifically relating to Israel and Palestine, what, in your opinion, will it really take to ever have peace? And is it that really (inaudible)?

THE PRESIDENT: That's a great question. What will it take to have peace in the Middle East? First, it'll take a firm rejection of extremism and a rejection of people who use terror as a weapon to achieve their political objectives. The ideological struggle that I just described to you is taking place throughout the entire Middle East.

Secondly, I believe that in order for there to be peace, there needs to be a Palestinian democracy committed to living side by side with an Israeli democracy in peace. And so I've advanced this vision. First of all, I believe it can happen. There's nothing worse than a leader saying, I don't think it's going to happen, but we'll try. I do believe it can happen. I do believe there can be peace. I understand how difficult it is because there are people who can't stand the thought of a democracy in their midst, because they have a different vision of government. This is what you're seeing playing out in Iraq. This is what is playing out in Afghanistan. Isn't it amazing that two of the youngest democracies on the face of the earth are being challenged by murderers and terrorists? They have a different vision of government.

Thirdly, this is being played out in Lebanon; a struggling democracy is having to deal with extremists groups funded by parties in the region that worry about the advent of democracy. And so my strategy has always been to lay out a vision that I believe can work, and work toward that vision. And so we're doing that in the Middle East.

Now, first, in order for there to be peace in the Middle East, there has to be a commitment by the leaders of the parties to work toward two democracies living side by side in peace. The United States can't impose a solution. We can't make the leader of a democracy -- force the leader of a democracy to make a decision that is not in the interests of the people of that democracy. So one of the interesting breakthroughs has been that the Israelis have come to believe, and rightly so, that it's in their long-term interest that we work toward a Palestinian democracy. Otherwise, the demographics will overwhelm the Israeli democracy.

And so the leadership -- this isn't -- they didn't say, hey, good idea, let's have Palestinian democracy because I said it. They have said this because it's in their interest. And so does President Abbas believe it's important and necessary. But the problem is, is that we have got to do two things. One, we've got to make this hope real for the Palestinians. In other words, they've heard a lot of rhetoric, but they really haven't seen a state begun to emerge from the rhetoric. So there's got to be hope.

And so one of the things Condi and I are working on is to see if we can't get the two parties to agree on what a state would look like so that the average Palestinian says, wait a minute, I'm sick and tired of this violence; I'm not going to support those who espouse radicalism and violence in order to achieve an objective, because here's a different vision. And in the meantime, we're trying to help this Palestinian democracy have the institutions in place -- a security institution, an economic institution, an actual functioning government -- that will inspire not only their own people, but inspire the Israelis to eventually trust their judgment that a Palestinian state on her border will yield the peace. And it's hard -- it can happen.

But we have to be firm in our rejection of extremists and radicals. And what happens in Iraq, for example, matters in the Palestinian Territory. What happens in Lebanon matters around the Middle East. And the truth of the matter is, Iran is using Hezbollah in Lebanon, and is worried about democracy in the Middle East; can't stand the thought of a democratic government on our border; is creating issues of peace. And one of the reasons I answered the man's question that I did about the need to succeed is because there would be nothing worse for world peace if the Iranians believed that the United States didn't have the will and commitment to help young democracies survive; that if we left before the job was done, there would be chaos -- chaos would embolden not only the extremists and radicals who would like to do us harm, but it would also embolden Iran. And what you don't want is somebody -- is to have a nuclear arms race taking place in the Middle East.

And so our objective with Iran is to peacefully deal with the issue and convince the Iranians to give up their nuclear weapons ambitions for the sake of peace. And that requires more than one voice speaking to them. It requires the international community understanding the stakes of what a nuclear-armed Iran could mean. I'm kind of getting out of the lane here on the question but -- anyway, I wanted to share this with you.

All of these democracy movements and freedom movements are related to the larger issues that you're reading about in your newspapers; the Iranian issue, the Iraqi issue -- they're all interrelated. And that's why it's really important for the United States to stay engaged and to promote democracy for the sake of peace.

See, 50 years -- the time between when my dad fought and Koizumi came into the office, 50 years is really -- or, 60 years -- is not all that long -- unless, of course, you're 59. (Laughter.) But anyway, it's just not all that long. And I've told people this is the first chapter of freedom's march in the 21st century against these radical ideologues. It's the first chapter. We're in for an ideological struggle that's going to take a while.

And my commitment is, let's make sure that first chapter that's written is one that'll yield the peace we want. Let's make certain when we look back at this generation that they say, they didn't shirk their duty; they did the hard work so future children can live in peace. And it's difficult. It's a difficult work. It's hard to do the hard things now. And so -- and the American people are -- you know, they don't like war. He's got to know I don't like it either. But I also understand the challenges.

And anyway, there's a part of an answer for a strategy that I believe is going to work. I really do.

Yes.

Q (Inaudible.)

THE PRESIDENT: A college education. If you're a poor student, you just got to -- you got help, because I signed a bill that increased the amount and size of Pell Grants. I believe strongly that Pell Grants is one good way of helping families afford higher education. I believe in tax incentives to help families save for higher education. I believe in student loans to help families afford higher education.

My view is this, that if you work hard and you want to go to college, you can find all the help you want. Now, some people don't like repaying loans, but that's part of life. If we can borrow some of your money -- if somebody's going to borrow some of your money, they ought to repay your money. (Applause.) No, I think if you really look hard, you'll find there's a lot of help.

The best thing we can do, by the way, to make sure that higher education is relevant -- this isn't exactly your question -- but to make sure it works in America, is to make sure our children can read and write and add and subtract. And I want to spend a little time talking to you about a subject that may be controversial for some. It's called the No Child Left Behind law. See, it's an old trick -- you talked about education, I segue into something I want to talk about. (Laughter.)

Here's the law. As governor of Texas, I was deeply concerned about schools in my state that were simply moving children through the system without being able to tell parents or officials or taxpayers whether or not that child could meet standards. And so what ended up happening is, is that I would go to a school and they'd say, well, we've inherited kids who can't read -- from the elementary school, for example. So I decided to try to do something about it. And step one was to say, if you're going to take our money, taxpayers' money, you need to measure. There needs to be a standard. You need to show us whether or not, for example, children are reading at grade level by the 3rd grade.

And I took this -- and the standards started improving education results. I mean, we actually -- using the word "result" wasn't something that we could use before we measured. We were guessing. Now we're measuring in our state.

And so I took this attitude to Washington, D.C. We're spending a lot of your money on poor kids in federal education, which I support. But I don't support the notion of not knowing whether or not that child can read. And so therefore we said, you design the tests. In other words, I said, you design the tests, not the federal government. I believe in local control of schools, but I just believe in strong accountability. I believe in saying to a school district, you better get it right, and you're going to measure to show us whether or not you're getting it right. And I also believe that in early grades, when we find somebody who can't read up to grade level, we ought to spend additional money to help that child get up to speed now, before it's too late.

And so the No Child Left Behind Act says, we trust you to run your schools the way you want to run them, but you show us whether or not a child can read, write and add and subtract. Guess what happens generally in some of the schools -- in my state, at least, they used to -- guess who was penalized by a system that didn't measure? African-American inner-city kids, you know -- they're hard to educate, let's just move them through. That's unacceptable to America. And it was certainly unacceptable to me as governor and me as President. I believe every child can learn, and I expect schools to teach every child how to learn. (Applause.)

And so to answer your question on college, you can find help to go to college, you sure can. But my advice is doing what I'm sure you're doing, which is studying hard now so that college is relevant to you later. And so I thank you for your question.

Yes, sir.

Q (Inaudible.)

THE PRESIDENT: Yes, I will.

Q (Inaudible.)

THE PRESIDENT: I'll veto it. Yes.

Q (Inaudible.)

THE PRESIDENT: Why don't you just leave her right there, then? (Laughter.)

Q After saying you're still having fun, I have even more respect for you.

THE PRESIDENT: Thank you.

Q But my question is a little bit lighter, I guess. Two things. One, are you able at this point to support any of the presidential candidates coming up?

THE PRESIDENT: No.

Q All right. (Laughter.) Then my next question. I have recently watched the interviews with your daughters, and you have to be very proud of them.

THE PRESIDENT: Thank you. (Applause.)

Q I'm proud of my daughter. My question is, would you rather see your daughters go into business or politics?

THE PRESIDENT: I'd rather them do whatever they want to do. (Applause.) And I -- what I want them to do is I want them to understand that when they can -- when they love a neighbor or when they help somebody in need, that they're really helping themselves. I want them to understand there is a certain responsibility in our society to reach out. So when Jenna told me she's a school teacher, I was very proud of that. Or when Barbara went down and worked in a AIDS -- pediatric AIDS clinic in South Africa, I was very proud of that. And yes, I love my daughters. And one of the hardest things I've done is I've put them in the spotlight. And that was -- I really wrestled with the decision to run for President because, of all the candidates, I understand what it means to be a son or daughter of a President.

And so it's been a blessing to see them grow up, and I'm real proud of them. (Applause.)

Yes. No, you're second.

Q Mr. President, it's a pleasure to have you here. My question, it brings the immigration issue a little closer to home. Recently, the mayor of Hazleton came to Lancaster City and spoke about his views regarding penalties for landlords and others who support illegal immigrants. The city of Lancaster passed an ordinance that rejected that sort of thinking. I'd like your thoughts about that position, please.

THE PRESIDENT: I think that -- one of the reasons I was strongly in favor of comprehensive immigration reform is so that would preempt local governments from taking a variety of actions which creates a confusing mosaic around the country. Obviously, you know, local governments can do what they want to do. But I believe the reason they feel like they need to do that is because the federal government hasn't acted with a comprehensive immigration reform bill. And one of the consequences of the federal government not being able to act in a focused, concerted way is that people felt obligated to respond locally.

And so Congress needs to -- you know, I don't know whether they're going to bring the issue up again. I was deeply disappointed that we couldn't get the bill going. I really felt like a comprehensive bill would, as I say, prevent this notion of city governments responding to immigration in a variety of different ways. Same thing is happening in Texas, in some places. And so it's a -- anyway, we'll keep trying to get it done. I'm going to tell you something: The country needs to address this thing in a comprehensive fashion.

Yes, sir. Oh, I'm sorry, ma'am. When you're getting over 60, sometimes your mind slips. (Laughter.)

Q Mr. President, my question is are you disappointed in Americans condemning the Iraqi war now, since --

THE PRESIDENT: Do what, now?

Q I said, are you disappointed in the Americans that condemn the Iraqi war now, since after -- right after 9/11 it seemed like we were all ready to go to war over it?

THE PRESIDENT: I'm not -- listen, people don't like war. I'm not disappointed in America at all. I love America. And I fully understand, you know, that people just are anxious about seeing death on their TV screens. I also understand that, you know, the enemy understands that. And so these spectacular bombings of innocent people are meant to achieve a couple of objectives: one, shake the will of those inside of Iraq, or wherever they kill -- Afghanistan, Indonesia, the Philippines -- all aiming to disquiet societies that live under democracy. But they're also smart people -- they know that these spectaculars will get on our TV screens.

And they understand the goodness of America. They may not view this as a strong characteristic of our society, which is that we respect human rights and human dignity and human life -- that may be viewed as weakness in their perspective. But for me, it's a strength. And they know that we'll recoil from these kinds of deaths. And so it's -- I'm not surprised, ma'am, that this war has created anxiety in our society. You know, like everybody else, I wish it would, you know, be over. But I want it over having accomplished our objectives, which is, as I told you, to write a solid chapter in this long ideological struggle so that 50 years from now when people look at the decision making they say, I understand where he's coming from and it was worth the sacrifice -- which is peace.

We live in a society, in a way, where things -- people have expectations that things ought to happen quite quickly. To come from a tyrannical society that really didn't know the habits of democracy and be given the challenge and the responsibility of governing a democracy is hard work. And I'm not making any excuses, but I'm telling you it's hard. There's no basis for which these folks inside Iraq have governed, except for somebody else's experience, not their own experiences. And I talk to these leaders a lot. And the first thing I'm looking for in them is courage -- do they have the courage necessary to stand up in the face of these attacks by extremists; do they have the capacity to reach out to each other?

And what's happening in Iraq is that as security has improved at the local level, local folks just -- average citizens stand up and say, we want more. It is wrong to assume that the average mom in Iraq is willing to accept violence. The average mom in Iraq wants what you want, which is your child growing up in peace. The average mom in Iraq wants something better for her child than what was under the tyranny of Saddam Hussein.

And so it's a -- what's happening there is, is as I said in my speech the other night, local politics will affect national politics; reconciliation is taking place at the local level and people who are learning how to run a democracy are beginning to respond. Anyway, I'm not disappointed in America at all. I love America and I really love the people.

Yes. I think that was your question, wasn't it? Okay. (Laughter.) The answer was so long, I lost track. (Laughter.)

What you got, buddy?

Q (Inaudible.)

THE PRESIDENT: Okay, I'll ask you a question: What grade are you in?

Q I'm in 10th grade.

THE PRESIDENT: Tenth, fabulous.

Q (Inaudible.)

THE PRESIDENT: Atta boy. (Laughter.)

Q I would like you to help me understand why you consider that (inaudible) negotiate directly with (inaudible) --

THE PRESIDENT: Appreciate that.

Q -- (inaudible) --

THE PRESIDENT: Great question. He says, why won't I sit down with the Iranian leaders, why won't there be direct negotiations with Iran? In order for diplomacy to work, the other side needs as much or more from you as you need from them. We have started negotiations with a leader and a former government we don't agree with, called North Korea.

And let me give you this case study. I was concerned about the North Korean weapons programs. I was concerned that they didn't honor agreements from the past, and so therefore I said we're not going to continue the bilateral negotiations that I inherited -- because I felt very strongly that those negotiations were non-consequential, in other words there was no consequence if somebody decided to just go ahead and ignore what we'd agreed to. Negotiations just for the sake of negotiations oftentimes send wrong signals. Negotiations to achieve consequences are worth doing.

And so my first objective was to put the discussion, potential discussions in a position that if Kim Jong-il decided to say one thing and do another, there would be some consequences. And the most consequential move would be that countries in the neighborhood, such as China, would become -- would try to affect North Korean policy. In other words, to get China at the table was an objective so that when we spoke to North Korea they would hear more than one voice. The United States -- they had heard the voice of the United States for the previous six years and didn't honor their obligations, we felt. But maybe they would change their behavior if they heard the voice of other countries. In other words, five of us got together and said, here's what we expect you to do, and in return for you doing this in a verifiable way, you will end up getting this. But if you decide to make a promise and not honor that promise, then there will be consequences. We had already sanctioned North Korea, so we were pretty much non-consequential in a diplomatic front. But China hadn't, for example.

And so step one was to try to make sure that any discussions we had were able to achieve objectives and in this case, this example is one where we were willing to discuss it, but we want to make sure that we set it