PELOSI: Good morning. Yesterday, we were all deeply shaken by the news of the violent attack at the Holocaust Museum. It reminds us of the valiant work of people who try to strive to protect us here, whether it is the tourists who visit, the press who cover, the Members of Congress, the embassies, the Administration. They do so with great courage. We had our own Gibson and Chestnut. Those two words mean a great deal to us here, two who lost their lives guarding the Capitol, and now Stephen Johns. Later today we will have a resolution on the floor, hopefully to be a comfort to his family, and also to talk about how despicable this act of violence was. It is really sad.

Earlier this week, we met with the President at the White House, when he announced his pay-as-you-go initiative. It was with great excitement that we heard his statement. Just as a little history, maybe even ancient history to some of you, that means before you were born history, in 1982, at the Democratic mid-term convention in Philadelphia, Congressman George Miller introduced a resolution for pay-as-you-go. It passed, it became part of the Democratic platform that year. And it took until 1990 for it to become operative here, when President Bush was President of the United States.

Throughout the ‘90s, it was how we operated. Pay-as-you-go. And the last four budgets of President Clinton were in balance or in surplus. You know what has happened in the eight years intervening in terms of the reversal of that under President George W. Bush . But now, happily, Democrats are coming together around this concept. For many years it has been the central organizing purpose of the Blue Dogs: fiscal discipline, fiscal responsibility. But I want you to know that there are initiatives from all sectors of our Caucus which support pay-as-you-go.

Early this year, in February, I sent a letter to our colleagues, the chairs of the committees, to ask them to subject everything under their scrutiny -- under their jurisdiction to the harshest scrutiny to find savings, whether it was waste, fraud, abuse, obsolescence, or duplication. We have gotten the reports back.

We will save $10 billion below the President's budget in that respect [the appropriations process.] And as our appropriations bills go forward, they will implement that direction.

Health care reform will be part of how we address reducing the deficit. Health care reform is entitlement reform, as the President so clearly states. So it is with great excitement that we are accelerating our discussion of pay-as-you-go as an important part of how we go forward on energy, on health care, on education, the three pillars to turn the economy around.

The Congress in the next week or so will have legislation on the supplemental and the FDA, but our committee work will be focused on the three pillars of the President's agenda which were in the budget, health care again, education, energy. Reduce the deficit, lower taxes, create jobs, turn the economy around.

With that, I would be pleased to take any questions.

QUESTION: Can you commit that health care reform will be fully paid for?

PELOSI: Yes. That is our intention, and that is the work that we are doing now, one of them. What are the priorities? How is it scored? How do we pay for it? It will be paid for.

QUESTION: OK. Speaker Pelosi?

PELOSI: Yes.

QUESTION: Financial disclosure forms are out.

PELOSI: Right.

QUESTION: You have large investments in AIG. So do other Members of Congress who received bailout funds. Do you think -- and not just bailout funds, but in large aspects of the economy, you are invested in clean energy, Comcast. Do you think that there should be stronger restrictions on how Members of Congress -- is it a conflict of interest and should there be stronger restrictions?

PELOSI: No. I don't think there should be a restriction on investment. When it became a company that was receiving funds, we divested ourselves of that. But for a long time, AIG was a thriving company and a concern in our country. But when there is any thought of conflict of interest, yes, then we should divest. But we don't know what that is going to be in advance. Who would have ever thought that AIG, this giant of an industry, would come to the place where the United States government had to bail it out? No. Nobody is happy about that.

QUESTION: Madam Speaker, later today a conference committee will meet on the supplemental. Can you talk to us for a moment about...

PELOSI: I am sorry?

QUESTION: Later today there will be the conference committee on the supplemental.

PELOSI: Conference committee, yes.

QUESTION: And there has been a lot of debate about the photo language from the Senate. Has a final decision been made on that? And if the decision has been made to strike that in the House vote and pass that through the House, how was that decision arrived at and why?

PELOSI: Well, no final decision has been made. The conference committee will work its will and make its decision. But I can say to you there is great concern in the House about making an exception to the Freedom of Information Act while a case is before a judge.

QUESTION: Madam Speaker, when your office was working on the TARP legislation and other bailout legislation, did you at the time know about your portfolio and how much money your family had invested in AIG and other companies?

PELOSI: Well, I signed my disclosure form, yes. We didn't know that on September 17th or 18th the Administration would come in and tell us the condition of our economy, that if we didn't act now we would not have an economy -- that was a Thursday night -- by Monday. No, we did not know that. But I signed my disclosure forms.

QUESTION: Madam Speaker, on energy, Chairman Waxman and Congressman Boucher yesterday both said they are working toward the floor debate the week before the 4th of July recess, June 22nd. Can you confirm that that is the goal that you are working toward? And also, how are you helping to bridge the differences with the Agriculture Committee?

PELOSI: Well, we will bring the bill to the floor when they are ready; whether it is health care or whether it is energy, when they are ready. And I congratulate Chairman Waxman and Mr. Markey for the masterful job they did in passing the bill through the Energy and Commerce Committee. Now, other committees have their jurisdiction to weigh in on, and that is the process we are involved in. And when we are finished and when we are ready, we will go to the floor.

QUESTION: On health care, Madam Speaker?

PELOSI: Yes, ma'am.

QUESTION: There are bipartisan discussions in the Senate about an idea, looking at creating a privately run cooperative instead of a public option. I am just wondering what you think of the concept. And given the concerns among some of your moderate members about a public option, is this something you might be open to?

PELOSI: Not instead of a public option, no. In our Caucus, I think Members have been -- I know that Members have been very clear about what their concerns might be about a public option. And I agree it should be actuarially sound, it should be administratively self sufficient. It should be a real competitor with the private sector and not have an unfair advantage. When you say the words "public option," if that is the term of art we will be using, you have to say right next to it "level playing field." But in our House, there is strong support for a public option, and great respect for the concerns that have been raised within our Caucus. And we will address them.

QUESTION: Madam Speaker, on health care, given what you just described is going to be very complicated for people to understand, and given the experience that the Clinton health plan had, and then that we had with Medicare part D, with public worries and anxieties and confusion, what strategy are you going to follow to explain this massive bill to people? Because health care is people's most -- one of their most basic worries in life.

PELOSI: It sure is. It is a personal worry in terms of their health and well being. It is also an economic issue for them as well. And I always say everybody in the country is an expert on his or her health care and how to be able to afford it.

We have our overarching message of affordability, accessibility, and quality that the President has put forth. In that framework, we will have the initiatives to help us meet those goals and are deeply rooted in those values. Right now, the bill is being considered, and I can only speak to the House. The three committees are working in unison, practically, with a unified staff. They will have something on the table in a week or two. Hopefully, most of it will already be scored, because at some point we have to know how much each element of it costs to see what we can afford and then how we pay for it. Because it will be paid for. And that challenge for us is to relate what we are doing here to the lives of the American people and how this makes a difference to them.

But we are very excited about it, whether it is about prevention and wellness, which is the important part of it, investments in scientific research, that we can have personalized, customized care for all Americans, with investments in technology so that we have a common record for all people to be on it, whether it is investments in community health centers to reach out to achieve this, as many people being involved as possible, because that is hard, and community health centers will enable us to do that. Whether it is having the resources to have sufficient health care providers at every step of the way.

We will be able to explain the bill to the American people once it is -- a mark comes forward, and then Congress will work its will, people will make suggestions, and we will have a product that will meet the President's values, meet the needs of the American people, be paid for, and make America healthier.

QUESTION: Madam Speaker, on health care and the public plan or government plan, whatever you want to call it, is it your belief that this is central, you know, an essential element of health care reform? Can you have effective health care reform without a public or government plan?

PELOSI: Well, let me say at the health summit the President was asked this question by Senator Grassley. You may have heard him. He said, "Don't you think that having a public health plan is unfair in terms of competition with the private plans?" The President said, "I think a public option is a way to keep the private sector honest." But, and we want to achieve what I just said, accessibility, quality, and affordability so that all Americans have access to quality health care. He then said if you have another way to do that, put it on the table. And that is where we are.

Everything should be on the table. From our perspective here, though, there is strong support for a public option right from the start. And there is also full support for having it be a real competitor, not something that has an overwhelming advantage. Of course it is not for profit and it doesn't advertise. So it doesn't have some of the overhead that the private sector has.

Already just the thought of having a public option has sort of eliminated words from the health insurance glossary of precondition, portability. Everybody seems to be subscribing to the idea that we shouldn't have a precondition in order to get eliminating you for health insurance.

So this is what we have come to do. Our three chairmen have asked that Chairman Dingell be the author of this bill. Every year since he has been here he has been the author of universal health care. Before that his father was. When he was a young Member of Congress in the ‘60s, he gaveled Medicare. He gaveled down the Medicare bill. Very few Republican votes, by the way, on Medicare. Very few Republican votes.

So we have heard the same concerns before. But it is a pretty -- as I say, this is the life work for many Members of Congress, and it certainly is the responsibility for all of us. This will happen. We told the President we would have a bill by the end of July, that it would be paid for, and that is the course of action we are on. And I commend our three chairmen, Chairman Rangel, Chairman Waxman, and Chairman George Miller , for working together, eliminating any turf challenges that occurred in the mid- or early ‘90s, 1993 or 1994, and to facilitate this improvement in the lives of the American people.

QUESTION: Madam Speaker, will you accept the Senate passed tobacco bill barring any unexpected amendment adoption in the next couple days?

PELOSI: When we see the bill, I can give you a more definite answer. But from what I have seen so far, I believe it will be possible for us to accept their bill and send it right on to the President. We are talking about the FDA tobacco bill.

Thank you all very much.