good afternoon, everybody. the president had a good meeting with his cabinet earlier this morning. this was the 30th cabinet meeting of his administration.

as you heard, one of the key focus areas of the cabinet meeting today was on the budget update that our office of management and budget director josh bolten provided you all a short time ago. we are well on our way to cut the deficit in half by 2009. the deficit is now $94 billion less than what the february forecast was. the president's tax cuts and pro-growth economic policies are fueling growth and job creation. we've seen 3.7 -- more than 3.7 million jobs created over the past 25 months. the unemployment rate is down to 5 percent. the economic growth that is fueled by the president's tax cuts are leading to significant increases in revenues, as josh pointed out.

we have two key priorities for keeping the deficit on track to cut the deficit -- two key priorities for keeping us on track to cut the deficit in half -- that is continuing to act on pro-growth economic policies and making sure that we exercise spending restraint. we appreciate congressional efforts on keeping us in line to cut the deficit in half by showing responsible spending restraint.

the president also talked about the importance of passing a comprehensive energy bill in the discussion with his cabinet this morning. that's a key part of continuing to act on pro-growth economic policies.

the president updated the cabinet on the successful g8 summit that occurred last week in gleneagles, scotland. he also talked about the recent attacks in london and our strategy for prevailing in the war on terrorism and defeating the ideology that the terrorists espouse.

secretary rumsfeld provided an update to the cabinet on the progress and challenges we're facing in afghanistan and iraq, both. secretary chertoff provided an update on the department review -- departmental review that he has undertaken. he's going to be talking about that more here shortly. he has worked to make sure that the department of homeland security is organized in a way that we are accomplishing our mission. and you will hear more from him here at 1:00 p.m. today, i believe.

secretary bodman provided an update on the congressional efforts to get comprehensive energy legislation passed. we are long overdue for passing comprehensive energy legislation, and we appreciate the efforts by the members of the conference committee to move forward and get this to the president's desk by the summer recess.

the president had a very good discussion yesterday with bipartisan leaders who are working on this effort, and we hope that they can get that legislation to him before they recess in august. secretary leavitt also provided an update to the cabinet on our educational campaign and outreach to seniors as we move forward to implement the prescription drug benefit that they will now be receiving. that effort is underway. we are having good discussions throughout the country. and he provided a good update to members of the cabinet on that.

and then as you heard, josh provided the update that he gave you all a short time ago.

sure. he wasn't asked about his support or confidence for karl. as i indicated yesterday, every person who works here at the white house, including karl rove, has the confidence of the president. this was not a question that came up in the cabinet room.

he expressed it yesterday through me, and i just expressed it again.

he was not asked that specific question, terry. you know that very well. the questions he were asked -- he was asked about were relating to an ongoing investigation.

i'll come to you in a second. i'll come to you in a second. go ahead.

no, i think he was asked about the attorney general.

no, david, i'm not at all. i told you and the president told you earlier today that we don't want to prejudge the outcome of an ongoing investigation. and i think we've been round and round on this for two days now.

again, we've been round and round on this for a couple of days now. i don't have anything to add to what i've said the previous two days.

you heard from the president earlier.

you heard from the president earlier today, and the president said he's not --

well, first of all, you're wrong. this is all relating to questions about an ongoing investigation, and i've been through this.

i think we've exhausted discussion on this the last couple of days.

i look forward to talking about it once the investigation is complete, as the president does, as well. and you heard from the president earlier today.

i appreciate your question.

again, i've nothing to add on this discussion, and if we have any other topics you want to discuss, i'll be glad to do that.

again, we've been through this for two days now, and i've already responded to those questions.

the briefings are available online.

again, i responded to those questions the past couple of days. go ahead.

we can continue to go round and round on all these --

and let me just say again that anything relating to an ongoing investigation, i'm not going to get into discussing. i've said that the past couple of days.

it doesn't change what i just said.

do you have a question on this, goyal?

well, i've already put out a statement on the visit and talked about how we'll be talking about how to move forward on what is a strong relationship. the president looks forward to welcoming the prime minister here to the white house. this will be an official visit, and there's a lot of activities planned around it. and maybe we can talk later in the week more about the agenda. but i think we're still working on finalizing the agenda with india right now.

well, we're continuing to take steps here at home to make sure we're doing all we can to protect the american people. the best way to protect the american people is to continue to stay on the offensive and to go after the terrorists where they are and bring them to justice before they can carry out their attacks. and we are taking the fight to the enemy now.

we -- the president made a decision after september 11th that we were going to take the fight to the enemy and fight them abroad so that we don't have to fight them here at home. now, we are also working to --

we're also working to spread freedom to defeat the ideology of hatred and oppression that the terrorists seek to spread. this is an ideological struggle.

now, here at home -- and secretary chertoff is going to be talking about this more here shortly, talking about some of the steps that we're taking, and how we're working to make sure that the department is organized in a fashion to make sure we're accomplishing our mission, which is to protect the american people. that means preventing attacks from happening in the first place and disrupting plots. we've made significant progress. but this is a sustained and long struggle that we are involved in. that's why we have to fight it on many fronts, and that's exactly what we're doing. the president just spoke the other day about all the steps that we're taking here at home to better protect the american people.

no, it didn't come up at the cabinet meeting. and in terms of the decisions that were made, i would say that war is difficult and it is tough. and you have to be prepared to adapt to changing circumstances and adapt to the unexpected. and that's what we have given our commanders on the ground the flexibility to do.

we've learned a lesson over history; it is that the commanders on the ground need to have the authority and flexibility to be able to adapt to changing circumstances. and that's exactly what we have given those commanders.

well, i think that you have seen arab leaders, you have seen muslim clerics speaking out forcefully against the attacks that took place in london. there are simply -- there is simply no excuse for murdering innocent men, women, and children. and that's exactly the kind of people that the terrorists are. it shows the true nature of the terrorists.

what we saw in london is a grim reminder that we are at war on terrorism. and this is an ideological war. these are people that have sought to hijack a religion. those who carry out these kind of attacks and espouse such a hateful ideology are not religious people. they have no regard for human life and that is -- stands in stark contrast to what we were working to achieve last week in scotland. we were working to save lives and improve lives. and you see the terrorists and their ideology that they seek to spread taking innocent human life.

they want to shake the will of the international community, and the international community is firm in their resolve and united in our determination to defeat the terrorists. and you defeat the terrorists by spreading freedom and defeating their ideology.

well, i've seen a number of arab leaders and a number of muslim clerics speaking up and speaking out against the attacks that took place. all people in the civilized world should condemn those attacks in the strongest terms. and we should all work together to defeat the ideology that they seek to spread, and that's why i talked about the importance of waging this on multiple fronts. we must work to address the root causes that lead to people hijacking planes and flying them into buildings, or lead to people strapping bombs onto themselves, and carrying out attacks in malls, or against innocent civilians in subways.

well, again, islam is a peaceful religion. it is a religion that preaches peace. and the president has made that very clear repeatedly. and we appreciate those that are speaking up and speaking out against the attacks that took place.

no, social security and -- strengthening and modernizing social security is an important part of continuing to promote economic security for all americans. we continue to work closely with congress. there continue to be discussions that are going on with members of congress. that's an important part of the president's second-term agenda. it's a high priority for the president, and we continue to work with congress and urge congress to move forward to strengthen social security.

and when we talk about the budget and the budget deficit that we are on track to cut in half by 2009, we also need to keep in mind the long-term challenges facing our budget. and those are, on the mandatory spending side, we need to address the entitlements. and the president has worked to implement reforms when it comes to medicare. and he's working to push reforms in social security so that we can make sure that the needs of our seniors are met, and we can make sure that we continue to promote long-term economic security for all americans.

we're continuing to urge congress to act and get this done. it's a high priority. the longer we wait, the more costly it becomes, and the more limited our options become. that's why it's important to act this year. you're talking about an additional $600 billion a year each year that we wait to act. that's why it's so important to act now.

les, i don't tend to speculate about things, but let me make very clear that one of our top concerns is the proliferation of weapons of mass destruction, and those weapons getting into the hands of terrorists. that's why we are waging the war on terrorism and that's why we are going to prevail in the war on terrorism and defeat the ideology -- the hateful ideology that terrorists seek to spread.

that's why we're also working to move forward on the president's proliferation security initiative. this is something we implemented. you have more than 60 countries around the world that are coming together to do more to interdict the proliferation or spread of weapons of mass destruction. we are having good cooperation on that. there are a number of ways we're acting to address the threats of proliferation. that is one of the highest, if not the highest priorities for this administration, because that goes directly to protecting the american people and protecting civilized nations around the world.

i think, in fact, one of the things that secretary rumsfeld -- i mean, secretary cheftoff spoke about today to the cabinet was what we're doing to address the threats from bioterrorism, as well.

i have a picture up in my office that everybody can look at.

it may not look like it, but there's a little flesh that's been taken out of me the past few days. (laughter.)

like i said, it may not look like it. (laughter.) i can assure you that it has been.

i don't have any update, in terms of that, in terms of what i've said previously. in terms of the comments, i saw the news reports. we continue to support the negotiations that are being led by our european friends to get iran to abandon any nuclear ambitions that they have. we will see how those progress.

there needs to be an objective guarantee from iran to make sure that they are not developing nuclear weapons under the cover of a civilian program. that means there needs to be a permanent end to their uranium enrichment and reprocessing activities. we have made that very clear. iran has a history of hiding and concealing their nuclear activities from the international community, and that's why an objective guarantee is so important. and we are all sending a very clear message to iran about the importance of having an objective guarantee, and we appreciate the efforts of our european friends as they move forward on the negotiations.

i'll come back to you in a second.

it will -- the president will focus on the importance of getting the central american free trade agreement passed by congress and how important that is to the textile industry, as well. as you're aware, this is -- the central american and dominican republic free trade agreement is not only important from a geo-political standpoint and important to support emerging democracies in central america, it's also important to leveling the playing field. we need to have a level playing field. and right now, when 80 percent of the imports from central america come in here duty free, that -- and that creates an unlevel playing field. we want to make sure that the markets are open and that there's a level playing field. that's important to continuing to move forward on creating jobs and economic opportunity here at home.

let me get you that information. i'll get you that later in the day.

condemn it in the strongest possible terms. it shows the true nature of the terrorists and the true nature of the enemy -- enemies that we face. the terrorists have made iraq a central front in the war on terrorism. they will be defeated. we will prevail in iraq, and we will prevail in the war on terrorism. it shows that they have no regard for innocent human life, whether it's men, women, or children. there is simply no excuse or justification for murdering innocent civilians, particularly children. and our thoughts and prayers are with the families of the victims; our thoughts and prayers are with all those who lost their lives in this suicide attack.

the terrorists are seeking to do everything they can to derail the transition to democracy. but every step of the way, the iraqi people have shown that they are determined to build a free and peaceful society.

those who carry out such attacks are not religious people. islam is a religion that teaches peace. islam is a religion that the president has spoken about at length, particularly in the aftermath of the september 11th attacks. those who seek to hijack it to spread their hateful ideology don't represent a great faith like islam.

i think i've made the president's views on karl very clear and his support for all those who work at the white house, including karl rove.

and again, these are all some of the similar questions that have been coming up over the last couple of days, and i don't have anything to add while this investigation is ongoing. but i think the president's views are very clear when it comes to karl rove and others who work here at the white house.

these questions came up the last couple of days, and again --

i want to help the investigation proceed and come to a successful conclusion. and the best way to do that, as i've said, not only the last couple of days, but going back nearly two years, is to not get into discussing the investigation from this podium, and those questions --

and those questions i've been through the last couple of days, this morning, and there's really nothing to add. and i appreciate it, but we've exhausted this discussion, i think. and we need to let that investigation proceed.

again, this is a creative way to come out to the same kind of questions.

i'm not going to play "what ifs," but iran did make a commitment, as you pointed out. and they need to abide by that commitment. they also need to abide by their international obligations, which they have violated over the last couple of decades.

we have a common goal, and we have a common strategy. and we are all sending the same message to iran. nothing has changed in terms of our views --

nothing has changed in terms of our views.

les, you want to refresh me on that case?

yes, i think we've expressed our views previously. and in terms of this question, you're bringing it up in the context of the nomination process. that nomination process is moving forward. the president is having good consultations with members of the senate. he looks forward to continuing that consultative process. yes, you have the words that he said previously.

yes, i do expect the president to watch the launch. we wish the crew of the space shuttle discovery a safe and successful mission. the president looks forward to seeing the space shuttle discovery launch and the return to flight.

in terms of the mission of nasa, yes, nasa has been moving forward on the vision that the president outlined. and this is a long-term vision that you bring up, one part of that. but today's flight is an important step in advancing space exploration. i think all americans are proud of our space program, and look forward to the launch of the space shuttle discovery. it's also a day to remember those who tragically lost their life on february 1, 2003, in -- onboard the space shuttle columbia. i know all of us in this room remember that day very well. and today's flight is a way to honor their commitment and their dedication to space exploration.

the united states leads the way when it comes to space exploration. and we want to continue to do that.

we'll get you a photo release from that. thank you.