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Press Gaggle by Scott Stanzel, Jim Nussle, Director of the Office of
Management and Budget, and David Paulison, FEMA Administrator
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For Immediate Release Office of the Press Secretary June 19, 2008

Press Gaggle by Scott Stanzel, Jim Nussle, Director of the Office of
Management and Budget, and David Paulison, FEMA Administrator Aboard Air
Force One En route Cedar Rapids, Iowa

˙˙Press Briefings


11:36 A.M. EDT

MR. STANZEL: Good morning, everyone. As you know, we're on our way to Iowa
where the President will view the flood damage that has been occurring over
recent days. I'll quickly go through the President's schedule and then turn
it over to the two guests that we have here today.

First, this morning the President had his normal briefings at 8:00 a.m. At
9:30 a.m. the President and Mrs. Bush participated in a ceremony for the
2008 recipients of the Presidential Medal of Freedom. Obviously you were
all there for that coverage.

This morning at 11:50 a.m., when we land in Cedar Rapids, the President
will receive a briefing on the Midwest flooding. Just a little bit of
background on the flooding: On May 25th tornados and record rainfall struck
the Midwest and continued for some period of time, which resulted in severe
flooding throughout 10 states in the Midwest. The President has declared
major disaster areas for Iowa, he declared a major disaster on May 27th;
Indiana on June 8th; Wisconsin on June 14th.

And we've been providing millions of dollars in aid and assistance to those
in need, including search and rescue teams, distributing food and water,
sandbagging. FEMA teams have been performing damage assessments to evaluate
the need for additional assistance. And obviously our guests here will be
able to talk more about that today.

And participating today we have -- and traveling with us -- Director Jim
Nussle, a fellow Iowan, from the Office of Management and Budget; Secretary
of Homeland Security, Michael Chertoff; FEMA Administrator David Paulison;
Secretary of Agriculture, Ed Schafer; Lieutenant General Robert Van
Antwerp, who is the Commander of the U.S. Army Corps of Engineers. And
participating in the briefing will be members of Congress and state and
local officials as well, and we'll get those to you on the ground.

Also flying with us today, just so you know, we have Senator Tom Harkin of
Iowa and Representative Dave Loebsack, of Iowa -- last name spelled
L-o-e-b-s-a-c-k.

At 12:25 p.m. the President will participate in an aerial tour of the area,
of Cedar Rapids and Iowa City. At 1:15 p.m. the President will visit Iowa
City, so we will be there in Iowa City. And then at 5:50 p.m. the President
will arrive back at Andrews Air Force Base. And tonight, this evening, the
President and Mrs. Bush are hosting a social dinner in honor of American
Jazz.

So with that I'd like to turn it over to FEMA Administrator Paulison to
give you a sense of the federal government's role in the relief efforts.
And we'll take your questions. And then I'd like to turn it over to
Director Nussle for comments about the financial response and the disaster
aid that we've been providing, in addition to -- he can comment, if you're
interested, on the supplemental agreement that was reached.

ADMINISTRATOR PAULISON: Let me do a couple things. I was here earlier in
the week and went to Iowa, Indiana and also Wisconsin. I met with all the
governors; we toured each state. And I've got to tell you, I'm very pleased
with the response that I saw, the coordinator response -- great
coordination between the local government, the state government and the
federal agencies and the private sector and the non-profits, like Red
Cross. I told all three governors that's how it's supposed to work and I
really gave them a lot of credit for putting a good team together.

What we've been doing is working with the states and delivering the
supplies that they asked for. And I'm going to give you a few of those, but
I'll pass out a piece of paper later with all of it. We've delivered 3.3
million liters of water. And what we learned in Katrina is FEMA can't do it
all by itself, so we, with the Corps, delivered 1.7 of that; GSA, 900,000
liters; and Wal-Mart, 550,000 liters. So we're leveraging the other federal
governments and also the private sector to help us deliver supplies.

We've delivered 200,000 MREs; 146 generators; 4,000 rolls of plastic
sheeting -- that's 50 miles of it, that's to go over the levee when they
put the sandbags on. And we have 23 of our mobile disaster recovery
centers, and seven more on the way, so that will be 30 -- that's to help
people get registered, so if they can't necessarily travel to where the
state's disaster recovery centers are, we can go out to where they are.
Another lesson we learned in Katrina.

We're also pre-positioned supplies -- I told you before that we're trying
to change the culture of the organization and not have FEMA be so reactive,
but more proactive. So in Missouri, that hasn't received the flooding yet,
we've already delivered 180,000 liters of water, 21,000 Meals Ready to Eat,
and 2 million sandbags. And that state has not asked for this stuff yet,
but we went ahead and pre-positioned it just to make sure it's going to be
there, depending on what this water is going to do when it gets down to
Mississippi.

Next steps, we're going to be transitioning out of response into the
recovery phase. And right now we have 28,000 people have already registered
for FEMA assistance. Our call centers are open 24/7. And if you remember
Katrina, it was three, four, and five hours before people could get
through. The answer time now is 12 seconds and we're answering 99.7 percent
of the calls. So a remarkable change from five years -- a few years ago.
FEMA has 700 people on the ground helping people with this response.

What I'm perceiving now, the next biggest issue is going to be housing. So
we're putting together a housing task force in every state, and that will
include the Small Business Association, FEMA, HUD, Red Cross, USDA, HHS,
Veterans Administration, and also the Army Corps of Engineers. We're going
to involve faith-based organizations in that, and also the private sector
to help us with the housing. There will be two different housing pieces:
one of them will be at the state level, the state will run, that FEMA will
drive; and the second piece will be a national one, run by FEMA and HUD to
oversee the whole thing to make sure we're getting all the supplies we need
and all the housing we need.

So we're going to work at the state level to find out what the requirements
are, and then start filling those requirements with whatever housing the
states may particularly want. We're going to be looking at apartments,
hotels, motels, rental houses, things like that first. And then if the
states ask for it, then we can look at mobile homes, but right now they
have not asked for them yet.

That's kind of where we are, transition from the response phase into the
recovery phase.

MR. STANZEL: I think if we could now, Director Nussle, if you want to make
a few comments about the aid and then we'll go to your questions for either
of these two gentlemen.

DIRECTOR NUSSLE: Assume the position.

Five hundred days ago, the President submitted a request to Congress to
fund the troops for the 2008-2009 budget cycle. It appears that Congress
has come to an agreement finally on this measure. If the agreement is as
follows, it appears that it's something that the President can support. But
we're obviously very concerned about this continuing to move through the
process.

The President had three priorities: make sure that the troops' needs were
met, to make sure that it did not tie the hands of the commanders, and to
ensure that the funding fit within the budget of $108 billion. It appears
that all three of those requirements are met. The President also, in the
State of the Union, expected that Congress work on a GI bill, modernizing
the bill, and to include with that transferability so that family members
may also benefit from the education benefits provided. It appears that
Congress, just in the last 24 hours, has added the President's request that
he made in the State of the Union. So that is acceptable.

There's no tax increases in this bill. The unemployment benefit is a much
different version that Congress has been considering, one that has a work
requirement, which the President was requesting; and one that recognizes
that we want to get people the help they need, but we want to get them back
into the work force.

Finally, we also were within this, as part of our work together with FEMA,
able to add a disaster piece to this that the President, just two days ago,
asked us to go up and negotiate. It will be $2.65 billion for the
emergency. Please recall that there is enough money now to fund this
current disaster. This is to replenish the disaster accounts in order for
future disasters. It will be $1.3 billion for FEMA for the Disaster Relief
Fund, $607 million for the Army Corps of Engineers, $469 million for
agricultural disasters, and $267 million for the Small Business
Administration.

One other just small item: Congress passed a moratorium on seven Medicaid
regulations earlier this year. We were able to negotiate one of those
regulations back into -- back to life and resurrect it. It's a cost-saver,
a small one, but one that we thought was important to add to the
negotiation.

Why don't I stop there.

MR. STANZEL: And with that, we'll go to any of your questions that you have
for either --

Q You said $108 billion was the max on the -- I thought I heard on the
radio this morning it was $130 billion.

DIRECTOR NUSSLE: Actually, it is $108 billion for 2008. In addition to
that, there's one other piece that was added. Congress decided to
forward-fund the request for next year, for 2009, of $70 billion. So it's
actually $170 billion -- I don't know where they got the $130 billion. They
added -- so it's $170 billion for war, and that will take us into next year
and the next administration.

Q So none of the $2-whatever billion for emergency is for the current
flooding, right? That's all for future?

DIRECTOR NUSSLE: Yes, yes.

Q How much is the current crisis going to end up costing --

DIRECTOR NUSSLE: That's something we're still analyzing.

ADMINISTRATOR PAULISON: -- at $4 billion currently, and that's obviously
plenty of money for this. What we want to make sure is -- we're just in the
middle -- at the beginning of hurricane season, so they're going to put
another $1.3 billion in there just to make sure we have a good cushion to
get us through hurricane season.

Q I'm sorry, just to be clear, is there a current estimate about how much
this crisis is costing yet?

ADMINISTRATOR PAULISON: As far as the cost of this disaster, we don't have
a handle yet. We're still working on that. I mean, we're doing -- the water
hasn't even gone down yet. So as we finish up the individual assistance
piece of it, which is for homeowners, and then we'll get into the public
assistance piece, which is generally the largest chunk. So I don't want to
give you a ballpark figure now, but we have $4 billion in there now; that
should be more than enough. And the only concern was, would that be enough
for now and hurricane season. We decided we really need to put a cushion,
so the President is going to put another $1.3 billion in there just to make
sure we got enough to get through hurricane season.

Q This is from the Disaster Relief Fund that you're talking about, right?
The Disaster Relief Fund?

ADMINISTRATION PAULISON: Yes, yes.

DIRECTOR NUSSLE: The DRF, yes.

Q Is President Bush today going to announce any new funding for farmers or
anything else related to this?

DIRECTOR NUSSLE: Well, the funding -- actually, it's the funding that
Congress -- we requested this $2.65 billion that Congress is going to
include in the supplemental. So that has been announced basically from the
negotiations just over the last 12 hours.

Q There won't be anything else aside from this announced in terms of
funding for relief?

DIRECTOR NUSSLE: No, no. This is what we've been negotiating with Congress.

Q What is the overall number for this stop? I maybe just couldn't hear, but
--

DIRECTOR NUSSLE: The $108 billion, plus the $2.65 billion, plus the $70
billion. But again, that's split up over two years, all right?

Q Director Paulison, in terms of disasters that the government has faced
since Katrina, can you put this disaster on the spectrum and in order of
the size and scope and cost? Where does this fit in?

ADMINISTRATOR PAULISON: It's obviously not as big as Katrina, no question
about it. It's probably one of the largest ones we've responded to,
particularly it's going to be housing side, and the number of states it's
covered. The next biggest was the California wildfires, but that only
involved one state. So this is several states, so this is the biggest one
we've done since Katrina.

Q And can you also give us a general assessment of the impact in terms of
people who have been killed, people displaced, in terms of housing? Just
right now, have you got sort of an overall sense of that right now?

ADMINISTRATOR PAULISON: We've had 24 people killed, which is tragic, and I
think there was a hundred in --

Q We're talking not just in Iowa. We're talking about --

ADMINISTRATOR PAULISON: Talking about all the states together, that's
correct, yes -- 24 people killed. The majority of those were in Iowa. And
there was probably about 100-some odd injuries; I'm not sure exactly what
that was. As far as displaced, I know there was at least 35,000 people
evacuated, but there's only 600 people in shelters across all three states.

So this is a really resilient community. They've either gone to family and
friends, or got their own housing. We won't know the actual housing mission
until the water recedes and people can get back to see whether they can
move in their house while they're repaired, or do they need other housing.
So that's what we're going to be working with the states on over the next
several weeks.

Q And in terms of what you're forecasting, are other states going to be
hard hit? Is the worst behind us, or what do we know about what's to come?

ADMINISTRATOR PAULISON: We know right down to Quincy, the water is
receding, but from Quincy down to St. Louis, the crest is still rising.
What we don't expect is the kind of impact we've already had because most
of that is agricultural land, and the smaller cities don't have huge
populations. When it gets to St. Louis, I just talked to the Army Corps of
Engineers director, he does not think there's going to be any problem in
St. Louis. The levee should be strong. That levee is at 51 feet, and it's
expected to crest at right around 37 to 38 feet. So we should be in good
shape in East St. Louis.

Q Can you address the lessons the President, himself, has learned from
Katrina in terms of his involvement in a crisis like this, in terms of when
he goes onto the scene, when he -- his personal involvement? I mean,
obviously, you've talked a lot about FEMA in general in the past. But I'm
just kind of curious if you can address it in terms of -- is the President,
himself, doing anything different now because of Katrina?

ADMINISTRATOR PAULISON: Well, I took over, what, in the second or third
week of Katrina, and the President was involved intimately with me on a
daily basis. So all I can tell you is, everything that I saw, he was
heavily involved, and I had, you know, regular access to him. He even came
to FEMA headquarters for our briefings. I had nothing but full support out
of him, I have to tell you.

Q Can you say what the President hopes to accomplish on a trip like this?
What does coming firsthand and seeing it add, in terms of value, when all
of these things are happening at the administrative level already?

ADMINISTRATOR PAULISON: Every major disaster we've had, the President has
gone to visit. He likes to get out and talk to people. He wants to make
sure the cities are getting what they want. He likes to talk to the
governors: "Is what I'm seeing accurate? Are they getting what they want?"
He really has an empathy for individuals. When we went to Greensburg,
Kansas, he walked the entire neighborhood, and he would spend about two
hours on the ground just talking to people, home to home. So he really
likes to do that. It gives him a good visual of what's going on. And when
we get back on the plane, I get 40 questions, so.

Q Mr. Nussle, on the supplemental, didn't the administration oppose the
extension of unemployment benefits?

DIRECTOR NUSSLE: Actually, we have supported extension of unemployment
benefits, but we wanted it to be done in a responsible way, and recognize
that we didn't want to exacerbate the employment situation. Oftentimes in
the past it's been -- it's a fact that there are many who may wait until
the last minute to look for jobs that are available.

Second, we wanted to have a strong work requirement in there. So instead of
having only two weeks on the job and getting then 52 weeks of benefits, now
it's a 20-week requirement of work before you get 13 weeks of extension.

So this is a much more reasonable approach, and I compliment John Boehner,
who is the one who actually brokered this agreement. It isn't perfect.
Others may have wanted it a little bit different in both directions, but
the administration has supported benefit increases and extensions in the
past.

Q With all this added spending, what is your latest estimate of the federal
deficit for this fiscal year? Is it going to be an all-time high?

DIRECTOR NUSSLE: We have a mid-session review; stay tuned. But there's no
question that with the downturn in the economy and with all of the
additional spending that is both requested, let alone added, in many of
these provisions, it's going to be very difficult. So, I mean, that's not
surprising, because of what's been happening. But we have a mid-session
review coming up here in about a month.

MR. STANZEL: I hate to --

Q Should we be braced for the biggest ever?

DIRECTOR NUSSLE: -- we're braced.

MR. STANZEL: I hate to interrupt, but these gentlemen are needed towards
the front of the plane, so I'll take any other questions that you might
have.

Q Thank you.

Q Scott, I know we're going on a tour to Iowa City. Can you give us the
details of what to expect?

MR. STANZEL: Yes. We will give you that full flavor when we land on the
ground, so you'll see it. But the President will be talking with local
officials there and visiting some of the affected areas. And we'll give you
more details in terms of the specific location when we land.

Q Scott, do you think that had Katrina not happened, would the President
have gone out so much in the way that Director Paulison described, where
he's -- he has gone to every disaster, he always makes it a point now to
get out there when something happens in the country. Did Katrina, in
essence, prompt that?

MR. STANZEL: I think he's -- he's always made those travels. I can remember
going back to the very severe hurricane season in 2004, making trips to
Florida and having people comment on the fact of the number of times that
the President was visiting those hurricane-impacted areas. So the President
has always felt it was important for him to get out and talk to the local
officials, as Administrator Paulison said, find out what they need, find
out how the federal government can support their response and recovery
efforts. And he feels it's important, and he's always done it.

Q Don't you think anything changed since Katrina, in terms of his approach?

MR. STANZEL: Well, I think the approach of the federal government that
Administrator Paulison talked about has continually improved. The
Administrator talked about pre-positioning supplies in and around, say, the
St. Louis area. The governor hasn't even asked for those yet, but it's the
anticipatory sense of FEMA to make sure that they have the supplies they
need in the area to respond as quickly as possible.

In some of these tornado-impacted areas, it's been a matter of hours and
FEMA personnel are on the ground, responding and setting up emergency
operation centers with the state and local officials, and working to assess
the damage so they know how to quickly get that federal aid out to the
people who are in need.

Q Can I ask you a question aside from this? Did the President indicate to
the Chinese officials that he met yesterday that he was going to attend the
Opening Ceremonies of the Olympics?

MR. STANZEL: I did not attend that meeting, but as you know, the
President's schedule for August and that trip has not been announced at
this point.

Q Do you know whether there's an actual answer, though, to that question?

MR. STANZEL: I refer you to the previous comment I gave.

Any other questions?

Q Have you guys gotten much response from the local officials right now, in
terms of what they want from the federal government on this trip?

MR. STANZEL: On this --

Q The response -- just in terms of the general response to the flooding;
what the local officials want?

MR. STANZEL: Well, yes, and I would refer you back to the President's
comments from two days ago. When he received the briefing, he talked a
little bit about the water; that water was a concern of Governor Culver in
Iowa. And as Administrator Paulison has indicated, they've distributed over
3.3 million liters of water. And that is a response that they had.
Obviously, sandbags, tarps, other funds that they could provide to help
with clean-up, those are things that have gone out.

When Administrator Paulison and FEMA officials and federal officials are in
communication with these state and local officials, they often, in those
meetings with -- is there anything that you need that you have not
received? Because we want to know how we can be supportive of their
efforts.

So it's very much a hand-in-hand, a cooperative effort to make sure that
they have what they need.

Q Have the floods had any -- had any impact on getting Congress to move or
to reach a deal on the supplemental? Was there any relationship between
those two?

MR. STANZEL: Well, I think that -- unfortunately with Director Nussle not
here now, I think that might have been a great question for him, because he
was obviously our lead negotiator, and was talking with members of
Congress. The severity of these floods has drawn the attention of people
around the country, including members of Congress. So I think there is
broad agreement with the President and with what he said two days ago when
he said we should put emergency supplemental funds in this supplemental to
make sure that we are replenishing the Disaster Relief Fund so we can deal
with those future disasters.

But to those discussions, to that level of detail, I'm not sure. But maybe
that's something that we can get back to you on.

Q Did you go to Iowa State?

MR. STANZEL: I sure did.

Q Were you on the cycling team?

MR. STANZEL: No, I wasn't. I was a fan; that's about it.

So thanks, everybody.

END 11:59 A.M. EDT

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