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Skriven 2006-01-19 23:33:44 av Whitehouse Press (1:3634/12.0)
Ärende: Press Release (0601198) for Thu, 2006 Jan 19
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Interview of the Vice President by Larry Kudlow, CNBC
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For Immediate Release
Office of the Vice President
January 19, 2006

Interview of the Vice President by Larry Kudlow, CNBC
Grand Hyatt New York
New York, New York



1:25 P.M. EST

Q Vice President Dick Cheney, welcome again to Kudlow_

THE VICE PRESIDENT: Good to be back, Larry.

Q I'm obliged really to ask you about this missive from Osama bin Laden
allegedly. But it is, of course, all in the news this morning. He actually
at one point threatens that he's going to be planning to bomb American
cities, and then somehow, the United States and he and his group will have
a truce. I don't know what to make of it. But the bombing of American
cities is something that obviously is catching my eye, and the eyes of
almost everyone. What's your comment on this?

THE VICE PRESIDENT: Well, first of all, of course, we don't know yet the
authenticity of the tape. We're checking that out. Secondly, we don't know
when it was made. We haven't heard anything at all from him in over a year
now. This would be the first, if it is, in fact, a current tape from bin
Laden. And then we'll have to sit down and take a look at it, see what it
means.

It's difficult sometimes to tell why they do these broadcasts -- whether
he's trying to communicate with his supporters around the world, or whether
he intends it as a threat. It's different to characterize it.

Q Is this the kind of thing that might raise the Homeland Security threat
assessment or threat levels?

THE VICE PRESIDENT: Well, it could. The fact of the matter is we're on sort
of a high state of alert most of the time anyway, as far as the government
is concerned. Obviously, we haven't raised the threat levels recently. The
fact of the matter is, it's a good reminder for everybody that there is a
serious threat out there. It has been more than four years since we've been
attacked. I think a lot of people have sort of let down their guard and
relaxed. This is a reminder that we can't afford to do that as a nation,
that this is very much a very serious group of people doing their best to
try to strike the United States. And we need to act accordingly.

Q Is this the kind of thing that Congress needs to look at when they are
addressing the Patriot Act, when they come back as people discuss the NSA
eavesdropping of foreign conversations with Americans and so forth? It's
all about homeland security. You think this will change any minds?

THE VICE PRESIDENT: I don't know. I would hope it would. I think -- there
are reasons why we haven't been attacked again in more than four years.
It's not just dumb luck. You can't -- nobody can promise that we won't be
hit again. As I say, we know they're still out there trying. But we have a
number of people -- some in Congress who now want to suddenly criticize the
measures that have been taken since 9/11 to try to protect the nation. And
that's unfortunate. I think, in fact, we have been very successful -- both
with respect to the NSA program that has become the subject of controversy.
I think the Patriot Act is vital. I think we have saved thousands of lives.
I think we have disrupted attacks. And I think Congress and our critics --
some in Congress, obviously, not all, need to be careful before they embark
on a course of action here that said somehow we ought to shut down those
programs, or that we have "exceeded our authority." I don't believe we
have.

We've operated within the bounds of the Constitution. The President has the
responsibility, as well as the authority to do what needs to be done, and
we've been doing it.

Q Okay, shifting gears slightly but still on the international beat, Iran
-- it's becoming a big financial market issue, as well as all the
international security issues. Realistically, is there a way the United
States and the allies can prevent Iran from getting nuclear weapons?

THE VICE PRESIDENT: I think it's important that we seek that objective. I
don't think we want a nuclear-armed Iran. I don't think that's in anybody's
interest -- either in the region or on a global basis. We've been working
very closely with the European allies -- the Brits, the Germans and the
French have been actively involved in this effort.

You've got a couple of concerns -- one is just a nuclear-armed Iran would
be a problem. But then you add to that the dimension of the newly elected
President of Iran, Mr. Ahmadinejad, who is hard to believe in terms of some
of the more outrageous statements he's made in recent months, calling for
the destruction of Israel, threatening a course of action that, obviously,
would be a -- be devastating in terms of its consequences. So I think the
U.S., as well as our friends and allies -- we're working hard on this
problem. We'll continue to do so. But I do think we need to prevent the
proliferation of nuclear weapons to a nation like Iran.

Q Is there a military option on the table as Secretary Rumsfeld has hinted,
as Senator John McCain has proposed? Is there a military option in this?

THE VICE PRESIDENT: No President should ever take the military option off
the table. Let's leave it there.

Q The other issues are, regarding a possible sanctions campaign, a naval
blockade, pinpoint air attacks, whatever, a lot of people in the financial
community are very worried about $70 ,$80, $90, $100 barrel of oil, which
could have some very negative consequences, obviously, for the economy --
indeed, the world economy. What's your thinking on that? Is that something
that is in your plans, a contingency that might have to deal with
triple-digit oil?

THE VICE PRESIDENT: Well, the way I think about it, Larry, is that the
problem here is of sufficient magnitude that it needs to be dealt with. But
I also would emphasize that we're attempting to do that through diplomatic
means. Now, whether or not there would be a spike in the price of oil if,
in fact, there's some kind of a crisis with Iran, it's entirely possible.
But I think the consequences of that would be less significant than the
consequences of haven't Mr. Ahmadinejad armed with nuclear weapons, able to
threaten virtually anybody he wants to threaten, and conceivably even
contemplate the use of nuclear weapons. That would be a major crisis.

So I think -- again, I'd like to emphasize that people need to stay calm,
cool, and collected here as we deal with this problem. But it is a problem.
As John McCain and Condi Rice and others have said, it does need to be
dealt with, and we're dealing with it.

Q You mentioned the Iranian verbal attacks on Israel. If Iran and any of
its client terrorist organizations that it sponsors were to attack, much as
Hitler attacked Poland in 1939, would the United States come to the
military assistance of its longtime ally Israel?

THE VICE PRESIDENT: I don't think there's any question but what we would
support Israel under those circumstances. I think any administration would.

Q And that would include military assistance?

THE VICE PRESIDENT: Obviously, we would support our friends in Israel under
those circumstances were they attacked.

Q Sir, is there any way to get at this Iranian issue by helping the
pro-democracy groups inside Iran, by bringing U.S. officers. Some have said
we could use the Swiss embassy as a haven. Others have said private
non-governmental groups and that sort of thing. Is there a way to undermine
the current regime by helping out the pro-democracy groups?

THE VICE PRESIDENT: I think it's a matter of long-term policy. The United
States wants to support the democracy proponents in Iran. One of the more
hopeful things about the situation in Iran is you've got a whole younger
generation that is very interested in the West, and the United States,
that, I think, finds the current theocracy that governs in Iran
distasteful, would like to see a change in their own government. And
obviously, a change in policy would follow if there were to be such a
change.

What mechanism might lead to those kinds of changes over time, how long it
would take and so forth, those are all open questions at this point. But
clearly, I think the outside world has an interest in seeing true democracy
come to Iran instead of the kind of system they have now.

Now, of course, nobody can run without the approval of the clerics at the
very top. And you have an unelected group at the very top, senior mullahs,
if you will, in Iran, who dominate the country, who support Mr.
Ahmadinejad, who have been involved in supporting Hezbollah and other
terrorist organizations. I think long-term it's not in the interest of the
Iranian people that that regime continue down that course.

Q Would the administration be willing to have diplomatic relations with
Iran? Some analysts in this country have said we should try to reconnect
them with the United States, somehow do business with them? Is that
possible?

THE VICE PRESIDENT: It's been impossible, in effect. In the past it has
been very hard to communicate with them. They -- and of course, they have a
track record that means they have, in fact, been staunch supporters of
terrorism. And now they're obviously in the business of trying to develop
their own nuclear weapons. Under the circumstances, it's not clear what
would be gained by having normal relations, if you will, with Iran. They
need to change their policies if they want to be treated by the
international community as a full member of the world community.

Q Let me switch gears, come back to the domestic side, talk some politics
and some economics. 2005 -- not a great year for the administration. After
the big victory in the election in '04, you kind of lost your mojo. You
kind of lost your momentum in 2005. As you look back on the year, sir, is
there anything you might have done differently to keep that momentum going
rather than the apparent political problems that happened?

THE VICE PRESIDENT: It's partly in the eye of the beholder, Larry. I don't
think it was as bleak a year as some have suggested. I think we had
significant success in both Afghanistan and Iraq from a political
standpoint: new President sworn in, in Afghanistan; now a new parliament --
three successful elections in Iraq with constantly rising participation. We
made major progress in two of the most important subject areas we've been
dealing with.

The economy was also very good. In spite of concerns about Katrina, for
example, we had over 4 percent growth in the third quarter. We've got
unemployment back under 5 percent.

Q Do you get a fair shake in the media? Do you get a fair shake in the
media on the economy? Isn't the economy kind of an underrated story? But in
fact, you and the President -- until very recently -- haven't done much to
sell that underrated story?

THE VICE PRESIDENT: Well, it's true, but the fact is, if you just look at
the data, I think any objective observer will say that 2005 was a very good
year for the economy, in spite of things like Katrina.

Katrina hit -- we thought that would throw a real monkey wrench in the
economy, and it didn't happen. Inflation is under control. Unemployment is
down. Growth is very good. Productivity is running at all-time highs. So I
look at '05 and I see a good year. Now you can say, well, we had some
missteps along way -- yes, I think we could have done better on Katrina
than we did. There's a temptation oftentimes, though, for the press,
especially, to zero in on one problem and to ignore everything else. And I
think Katrina was a unique kind of disaster -- national disaster. And the
President himself has said we could have done better in terms of how we
responded to it, and handled it.

But on balance, I think we look back from the perspective of history, 10
years down the road, I think '05 will not have been a bad year.

Q Sir, again, thank you for agreeing to this interview. Recently the White
House Office of Management and Budget came out with a revised budget
deficit for the new year of $400 billion. That's about $100 more than last
year. It was a surprise. Do you worry that this kind of new higher deficit
estimate could really doom the tax cut extensions on dividends and capital
gains when they come up for a vote in the Senate in a few weeks?

THE VICE PRESIDENT: Well, I certainly would hope not. I think the case
could be made -- and we try to make it all the time that those new rates on
capital gains and dividends have been instrumental in generating additional
revenue for the federal government. And I know you've been a strong
believer over the years, Larry, and I share your conviction with respect to
wise tax policy and what it does with respect to government revenues. I
don't think higher taxes mean a smaller deficit. I think, in fact, strong
economic growth means a smaller deficit. And it's important that we
maintain tax policy that promotes growth, and we'll continue to make that
argument and make that case.

Q In particular, though, I was surprised you didn't have a greater emphasis
on spending cuts in this budget to offset whatever additional funds for
Katrina -- $400 billion deficit is going to raise some eyebrows. Why not
just clear out the pork in the federal budget? As you know, there's a
popular outcry to do so. Why not have the White House come out against the
earmarks? They're pork barrel earmarks. They've really allowed cash for
legislative favors. In some sense, they're at the heart of the corruption.
What's your own view on the earmark issue?

THE VICE PRESIDENT: I think the earmarks are a problem. I know from my time
of running the Defense Department 15 years ago, it was frustrating then to
be told by the Congress to specify spending amounts that had nothing to do
with national security but were all geared to satisfy some member of
Congress's political needs and requirements. And it has gotten much worse.

The bill when I -- the authorization bill at Defense used to be about 70 or
80 pages long 50 years ago. Now it's hundreds of pages long because of
earmarks. One solution for this is the line-item veto. And the President
has constantly supported that. If you had the line-item veto, he could
reach in without having to veto the entire bill and knock out individual
earmarks and do a lot to clean up that legislation. That would be a
significant plus. I think you're right. I think earmarks are a significant
problem.

Q Will the White House come back? Are you going to have bigger spending
cuts than in the past? Are you going to go across the board? Are you going
to really say to the public, look, we know there was pork in that highway
bill, we know there's pork throughout the government, we know there's a lot
of agencies that could do without, or at least do with less? Are you going
to be tough on the budget this year?

THE VICE PRESIDENT: Well, I just came back -- broke off a trip to the
Middle East, an important trip when I was out dealing -- Iraq, Afghanistan,
and so forth, to cast the tie-breaking vote in the reconciliation debate in
December. This is to cut $40 billion out of mandatory spending for the
coming fiscal year. And my vote was the one that got it through the Senate.
We passed it 51-50. So we're committed to doing everything we can to try to
restrain federal spending.

My big concern is not only the short-term problems. The President is
concerned about that, as well, too. But where are we going long-term.
Ultimately, I think the fate of the republic turns less upon the deficit in
any one particular calendar year, fiscal year than it does on the long-term
proposition we're faced with, with respect to the coming retirement of the
baby boom generation, what happens to Medicare costs, and so forth
long-term. Those are the problems we need to deal with. And this takes us
back around to what the President was pushing very hard this year on Social
Security. We've talked about it before, but we'll continue to push hard.
But ultimately, we need to reform --

Q You will continue to push hard on Social Security this coming year?

THE VICE PRESIDENT: Yes.

Q The President mentioned it today in his speech in Virginia. But that is
going to be a priority?

THE VICE PRESIDENT: It will continue to be a priority as long as we're here
because ultimately it has to be addressed.

Q Will you also push hard on tax reform? A recent study by the Tax
Foundation says it costs a cool $265 billion a year to comply with the IRS
and this tax code. Connie Mack presented you with recommendations and so
forth on tax reform. Is tax reform on your list?

THE VICE PRESIDENT: It's clearly something we're looking at. I don't want
to get into the business here of giving you a forecast on the State of the
Union speech. That's coming up shortly. But we'll continue to look at the
tax reform issues, as well. And we've talked before, I think it's very
important to make the effort to maintain the reductions in rates that we've
put in place now over the last five years, as well as the reduction in the
tax on capital gains and dividends. We took that down to 15 percent. We
need to make these changes permanent if, in fact we're going to continue
the kind of economic growth that we all want to see.

Q Speaking of regulations and so forth, what's your take on this
extraordinary action by the state of Maryland which is forcing or mandating
Wal-Mart to spend 8 percent of their payroll on health costs. If they
don't, the differential goes to the state itself. What's your thought on
that? Is this something you want to see across the country and the U.S.?

THE VICE PRESIDENT: Well, I haven't gotten into the issue in any great
detail, Larry. I can't claim any expertise on it, so I'll take a pass.

Q The Washington Post calls it a legislative mugging of Wal-Mart. What do
you think?

THE VICE PRESIDENT: Well, again, I don't know enough about it, Larry, to
have an opinion on it.

Q All right, let me come back, a lot of people talk about the culture of
corruption in Washington. And some commentators believe it's going to be a
rough year for Republican candidates for both the House and the Senate.
Your thoughts? And will you be out there on the campaign trail this year?

THE VICE PRESIDENT: I will be out on the campaign trail this year. I've
already been out, and I expect to be very actively and aggressively
involved.

I think it's also important to point out that from time to time we do run
into problems with respect to individual members of Congress who don't
adhere to the rules and regulations. We've seen that as -- no, I don't
think either party has a corner, if you will, upon avoiding those kinds of
problems. We had the issue of Congressman Cunningham this year. There are
other issues pending with respect to the Democratic side of the aisle, as
well, too. It's important that Congress conduct itself at all times in a
manner above board. And when rules are broken, when laws are violated, that
people be prosecuted. And I think that will, in fact, happen.

Q Last question, sir, how do you feel? Are you ready for the battle ahead
that's going to be on almost all fronts, international, economic, domestic
and so forth? How are you feeling?

THE VICE PRESIDENT: I feel good, Larry. I've been very fortunate to have
the opportunity to serve in this administration, and I look forward to the
next three years as the President's number two man.

Q Vice President Dick Cheney, thanks ever so much for joining us on Kudlow_

THE VICE PRESIDENT: Thank you, Larry.

END 1:49 P.M. EST

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