Remarks At The National Conference of Editorial Writers

SECRETARY RICE: Well, it's a pleasure to join you and I will keep my remarks very brief so that we can try to get questions from everyone.

This is a complicated time in the international system. I don't think that anyone would quarrel with that statement. But perhaps as a student of international politics, I'm aware that when the international system is in the process of rearranging itself, things are complicated and the challenge is to look for the places of opportunity and to minimize the places of danger. And in the last couple of years here of the Administration, I do think we have some places of opportunity even though they, too, bring certain complexities with them.

I've just come back from one of those places. I spent some time in the Middle East, as you may well know. And I think that the events of the last several months, while they've made events -- have made relations between Israelis and Palestinians perhaps more complicated, also provide some opportunities. And we're trying to seize the opportunity on the Middle Eastern front to do several things: to make certain that there is an active track of discussion between Palestinians and Israelis. This is not easy in the face of the formation of a government of national unity that is, in fact, not compliant with Quartet principles, but it is made possible by the fact that there is an interlocutor in Abu Mazen who is someone who is himself very faithful to the Quartet principles and has held those principles, particularly the renunciation of violence, for a long time.

And so one of the things that I tried to achieve when I was there was to make certain that the Israeli-Palestinian track would continue.

It is indeed the fact that they will talk about various day-to-day events, the day-to-day issues. They have to talk about issues of movement and access. They have to talk about issues of security. But it's also important that they begin to talk about their future together, their political horizon. And for the Palestinians that political horizon really means being understanding that they will, in fact, have a viable state; and for Israel, that that viable Palestinian state will contribute to security, not detract from it. And so I spent a good deal of time talking about how they might use their conversations.

Now, when I say that these are not final status negotiations, I want to underscore that they really are not final status negotiations. It is the case that this is a relationship that has been under a good deal of strain for the last six years since the end of the Camp David effort, and they need to spend some time to build confidence so that they can talk about their future. It doesn't mean that they won't be open to raising any issue. But I think it's not really right to expect that they're going to go into a room and that they're going suddenly try to negotiate final status. They've got some building of confidence to do.

This all takes place though in the context of a broader effort that we're making for perhaps a political horizon not just between Palestinians and Israelis but between Israelis and Arabs, because if there is a sense in Israel that peace with the Palestinians will bring not just peace with the Palestinians but also with the Arabs, I think it will give an impetus, a push, to the Palestinian-Israeli track. And so I was very pleased that out of the Arab League summit in Riyadh there was a re-initiation of the effort on the Arab League proposal, once the Crown Prince the proposal and having been named for then Crown Prince of Saudi Arabia, but that they will try to use this, I think, as a means of active diplomacy to try and begin to talk about a horizon for Israel and its Arab neighbors. Because the fact is Israel isn't going anyway, the Arab states aren't going anywhere; they're going to have to find a way to live together as well.

That's been the focus of our efforts in the Middle East, but I want to just mention that they come in the context of another overarching and principal goal of this foreign policy, and that is that if the Middle East is to be truly stable in the long run, it's going to have to be a Middle East that is on the road to reform and democratization. It is not something that is going to happen overnight. The President spoke of it as a generational issue. I've spoken of it as a generational issue. But the countries of the region have to get started on reform and they are in different places on the continuum in terms of reform and democracy, but each and every one of them, I think, has begun to recognize that some change has to take place.

Now, that change is going to have its ups and downs, and there are going to be good times and bad times and there are going to be disappointments because this is going to be -- this is a long history of fairly autocratic regimes rather than reformist regimes. But even in a situation like Egypt where there have clearly been some disappointments, and I will admit some personal disappointment on how the course of reform has sometimes gone there, when you look back over the last year plus, I think you will see that you in the future will probably never have a presidential election that looks like old style presidential elections when this last election permitted the kind of open debate and the kind of criticism of the government, even criticism of the president himself, that the debate leading up to the presidential election in Egypt allowed.

That means that very often reform and democratization is kind of a stepwise function; you get to a certain level and perhaps it levels off, and you get to another level and it levels off. But once you have begun this process, once this process has begun and begun on a region-wide basis, I have to think that this is a genie that's going to be very difficult to put back in the bottle and that over time these reforms are going to take hold. They have to take hold in an indigenous form. They can't take hold from the outside. When people say you shouldn't try to impose democracy, I wonder what they're talking about. You don't have to impose democracy. You have to impose dictatorship. And so this is a process that's going to continue and it's a process in which the United States is going to continue to have an interest and continue to be very involved.

So with those remarks, I'm happy to take questions, and really on any part of the world, not just on the Middle East.

QUESTION: Secretary Rice, I'm Fred Fiske from the Post-Standard in Syracuse. Of course, we live in a democracy and it can be kind of unruly and messy sometimes, and we had a pretty significant election and then now we've got a Congress that's coming up with some proposals that would place time limits on our involvement in Iraq and while funding our current operations. Is there a way that you can present this or that you do present this abroad as in a way such that it does not appear that we're losing our resolve or that we are not capable of continuing but this is just a process that has to take place?

SECRETARY RICE: Well, it is a concern. It is a process that takes place. It is our democratic process. We, of course, have a separation of powers, not a parliamentary system, and sometimes it's important to explain to people that it is, in fact, not a parliamentary system; in other words, you have a commander-in-chief who has certain responsibilities and authorities about the conduct of not just foreign policy but most especially of war. The Congress, of course, has the power of the purse, the Congress has the power of oversight, but that it is extremely important to our forces in the field and to our allies that they understand that the President needs to retain the ability to manage and direct his forces and his diplomats in the field.

And I think that's the essential problem with the legislation as it's currently drafted. It's fine to have the funding, but if you don't have the flexibility to allow your commanders to do what it is that they think they need to do without believing that on Day X that authority is going to be taken away because you've set an artificial deadline, then you've set up a problem. And I try to explain this abroad. Our allies, I think, understand that we do have a democratic system. But what we have to keep driving home is that the United States is going to be there, the United States is going to exercise its obligations for a territorially intact Iraq that can defend itself, that is moving toward stability and democracy, and that we're going to maintain our obligations to that.

So yes, it's a bit complicating, but if you go through the argument and you explain to people what our system actually is, I think it does help.

QUESTION: Jonathan Gurwitz with San Antonio Express News. Dr. Rice, we look at this renewed emphasis on a diplomatic track and then we look at some of the changes that have taken place in the Administration, including on your own staff. And the question arises whether there has been a change in the philosophy that guides U.S. foreign policy or whether there has been perhaps a change in the priorities for that foreign policy.

SECRETARY RICE: I'm glad you asked that question because I am stunned when I look up and see that either I've changed, the President's changed or we both changed or something major has shifted here, when I think of this as the natural evolution of having laid certain groundwork over a new extended period of time in which you work very tirelessly to align the incentives and the disincentives for both your adversaries and your friends to the point that you can then harvest the benefits of having properly aligned those incentives and disincentives. Let me give you a couple of examples.

If you look at the situation with Iran, why do I now feel that I can walk into a room on a neighbors conference or for that matter if the Iranians were willing to suspend their enrichment process, enrichment and reprocessing activities to walk into a room and join negotiations with the Iranians? Well, because over a period of time, working with our allies and broadening and broadening the base of those states that are committed to a diplomatic process but that are also committed to disincentives for Iran if Iran does not choose diplomacy, we now have a situation in which we are in a position of strength, not a position of weakness.

When I first became Secretary, I remember going to Europe and I was struck by the fact that somehow -- and Sean will remember this -- in the questions it was as if Europe believed it was mediating between Iran and the United States on a nuclear issue. Well, Europe and the United States were on the same side of the nuclear issue vis-à-vis Iran, so how could that be the case? Well, over a period of time, through some proposals that we put on the table, through some flexibility that we showed, we have moved the entire international community to the place that you can get a Chapter 7 resolution in July and then get a Chapter 7 resolution some -- sorry, get a Chapter 7 resolution in December and then get a Chapter 7 resolution in what the UN is lightning speed just a few weeks later that really does put pressure on Iran to say there's both a diplomatic track and a track of isolation. But it takes time to build that kind of coalition. It takes time to build that set of incentives and disincentives.

Another example is North Korea. We didn't wake up one day and decide, all right, now it's time we can have an agreement with the North Koreans. No. We've been through a painstaking process of developing the six-party talks as a coalition of states dedicated to a denuclearized Korean Peninsula, bringing the Chinese strongly behind this coalition, bringing together then all of the states at the table who have the right set of incentives and disincentives. We've worked on that for three-plus years. The North Koreans then set off a nuclear test which, frankly, accelerated the process of that coalition coming together. We got a Chapter 7 -- very strong Chapter 7 resolution against the North Koreans. I went out to the region. I talked to the allies about really making sure that we were instituting that Security Council resolution faithfully, but also offering that the North Koreans to come back to the six-party talks without preconditions, which they did. When they came back they were ready to deliver on this so-called initial harvest and I think now we'll make some progress.

So when you look -- don't look -- I would just suggest don't look at a snapshot of where we are in the diplomacy. Look at the long effort that it takes to get the incentives and disincentives properly aligned so that you get to a place that you might actually have a favorable diplomatic outcome and that's a bit different than we woke up one day and decided, well, now it was time to talk to the North Koreans. And I can tell you that's just not the way it was.

Yes.

QUESTION: Madame Secretary, I think most people notice that one of the ways that we moved forward on North Korea was by finally agreeing to bilateral talks with them, which took place in Berlin. Do you think that the same approach might work with Syria and/or Iran?

SECRETARY RICE: Well, again, when the North Koreans first wanted to have bilateral talks, they just wanted to have bilateral talks. They didn't want the pressures of Chinese and Japanese and South Koreans and Russians to be part of that. They now accept that this is all within a six-party framework. And so when they went to Berlin they started with: "We understand this is in a six-party framework and these bilateral discussions are to advance the six-party agenda."

So the important thing is not to get caught in a situation in which it's the United States and North Korea or the United States and Iran, and everybody can say go make a deal with them and, oh, by the way, if you don't make a deal it's the Americans fault.

It's when you have this kind of coalition that is working, then I think to be able to have bilateral discussions not negotiations, but discussions to move forward. The multilateral negotiations make sense.

Now, with Iran, if Iran suspends its enrichment and reprocessing activities and we go to six-party talks -- it would again be six parties, by the way -- plus Iran. In this case it would be seven, I guess, if we go to that and you would never rule out that it might be useful at some point to have a bilateral encounter that moves forward those -- that seven party arrangement. But what you don't want to do, I think, is make this U.S.-Iranian negotiations over the Iranian nuclear weapon because you don't have -- the United States cannot deliver the level of isolation that you have to have on the negative side in order to get Iran to accept the positive side.

QUESTION: I agree with you on the desirability of approaching these countries in a regional context. On the other hand, I think you have to say that there is an element of mutual respect in being prepared to sit down with the representatives of any country on a face-to-face, one-on-one talk.

SECRETARY RICE: Well, but when you expect something to be achieved -- I mean, you never just talk in diplomacy. You don't. You talk with an aim to get some place.

QUESTION: Hmm.

SECRETARY RICE: Well, you know -- (laughter) -- I don't just talk, okay. When I go into a discussion even with my closest friends, I go in expecting to achieve something -- my closest diplomatic friends.

QUESTION: Yeah, yeah.

SECRETARY RICE: Not my friend friends -- (laughter) -- then I can just talk. But I go in and think, all right, what am I trying to achieve. Because you don't want to send the wrong signal, which is that it's okay just to keep talking and not achieve anything. You know, one problem that the Iranians have had with the earlier European negotiations was that they talked and they talked and they talked and they never got anywhere. And so the Iranians walked out, started reprocessing -- enrichment reprocessing and we ended up in a worse situation actually. So I'm all for talking; that' not the problem.

And by the way, I'm not ideologically opposed to talking to people with whom we have adversarial relations. But it is extremely important that it be in a context in which you actually think you can achieve something. And I go back to the fact that any negotiation, any discussion is a matter of aligning properly the incentives and disincentives for behavioral change.

QUESTION: Thanks.

SECRETARY RICE: Yes.

QUESTION: Steve Chapman from the Chicago Tribune. Among the people who seem to have been confused about what you were trying to accomplish with your policy on North Korea in the last six years is Ambassador Bolton who sees this as a drastic reversal of what you've done in the past and a big mistake. Would you like to address what he said about it?

SECRETARY RICE: Well, John's entitled to his opinions and I'm not going to address John directly. I'll tell you what I think we've. I think we've achieved a six-party agreement on a course to the denuclearization of the Korean Peninsula, meaning the denuclearization of North Korea, since this is not an issue for South Korea. It begins with initial steps in which the benefits for the North are not front loaded as they were in prior agreements, but rather where the North has to deliver first on stopping its reactor, and then in the next phase actually disabling its reactor so that it cannot be used.

But to achieve the full denuclearization of course you're going to have to deal with whatever weapons and whatever materials were made during the -- the North Koreans have been at this almost 30 years. They've been at this nuclear weapons program. And so there will come a time when you have to move further to the actual dismantling of anything that is there, but it is step by step, but the time in which they simply stop what they're doing, there's not that much that is a kind of benefit to the north. It is a 50,000 metric tons of fuel oil out of what would ultimately be a million metric tons of fuel oil and some cautious steps along the path of political relations that could lead to normalization.

I think this will probably also lead ultimately to the questions about the Korean Peninsula itself and the status of the two powers there: the six-party framework agreement that -- the six-party agreement of September 2005 anticipates that there might be some kind of peace mechanism instead of an armistice. It also anticipates that there might be some kind of cooperative security mechanism that would bring all of the countries of northeast Asia into a conversation about their common security concerns. So this is a big package that has a front end piece in which there's actually not that much benefit. The benefits are not front loaded for the north. I think that's the right strategy. The most important thing is it's a six-party agreement and so if the North Koreans decide to do what they did about the 1994 agreement, they would face not just the United States but the Chinese and the South Koreans who have real leverage over the north's well-being.

QUESTION: Well -- but what does it say about the policy that one of your main diplomats seem to not grasp, but you are trying to accomplish with it?

SECRETARY RICE: I can't speak for John. You'll just have to ask John that question. (Laughter.) I'm not going to try to speak for him and he certainly doesn't speak for me, so you can -- if you get a chance, you can ask him.

Yes.

QUESTION: As to Iran -- Jim Mitchell, Dallas Morning News. As to Iran, it's pretty obvious, I think that the current ruling government is it does not understand the meaning of incentives. Is there a -- absent that, is there a moderate element within Iran who can and that you perceive as a player in the ultimate outcome?

SECRETARY RICE: Yeah. Well, I would not use the word moderate. I think what we're looking --

QUESTION: Comparatively.

SECRETARY RICE: -- for is responsible. (Laughter.) Okay, responsible. But I think the point is well taken. Iran is a country that is in fact quite integrated into the international community. It uses the financial system. It trades, it -- and not just in oil, it trades in products and its people are accustomed to traveling. It's not by any means as isolated as North Korea is. And you would hope that at some point, there would be reasonable people who would say what is the international community offering us? They're offering us a civil nuclear program, in other words, answering the question about civil nuclear energy as long as we don't have the fuel cycle which has a proliferation risk and on top of that offering us all kinds of trade and political relations along the way that would not just embed Iran more deeply and more prosperously in the international system, but would also end its isolation with the United States.

Now, I would say that's a pretty good package to just say stop enriching and reprocessing. And I have to believe that at some point there is a reasonable part of the Iranian political elite that will recognize that that's a better course than they are on. And so that's the goal.

QUESTION: And who might those be?

SECRETARY RICE: I can't put names to them and I'm an old Soviet specialist and I'm extremely aware of how little you know about the internal politics of an opaque political system. And so I don't want to try to opine on who they might be, but I know that there are business interests for instance in Iran that are finding it exceedingly difficult now just to do their financial business because banks are leaving Iran and refusing to deal in Iranian accounts. There is a significant oil and gas segment that is declining and can't get the level of the investment that it needs. So you could speculate on who some might be, but I wouldn't want to say that I had any real knowledge of it.

QUESTION: Yes.

SECRETARY RICE: Steve Falcone from the Reno Gazette-Journal. We've heard a lot about the Middle East, we've heard about Korea. One omission from the agenda seems to be the Western Hemisphere and given the President's recent visit to South America and the return visit of President Lula, could you give us an assessment of what is going on, what our concerns are and what our -- the status of relationships are with particularly Central and South America these days?

SECRETARY RICE: Sure, sure. Well, first of all, it's by no means -- it's very much at the top of the agenda. When the President goes to Latin America for five days, that shows where it is in our agenda. He's long said good policy begins in the neighborhood and we --

QUESTION: I'm sorry, I meant from our agenda, not necessarily your agenda.

SECRETARY RICE: Oh, our agenda, okay, great, great, great. What we've had is a policy that has several elements and I think we underemphasized one of those elements. Clearly, trade is a critical part of our involvement there and the Central America Free Trade Agreement, free trade agreement with Chile, pending free trade agreements with Peru and with Colombia -- so we're big believers that free trade is -- can be a spur to economic growth and therefore, to prosperity.

And so trade has been very important and when it was clear that the free trade area of the Americas was not progressing very actively, we went to a pretty active agenda of really bilateral free trade agreements and we concluded a lot of those.

That also fits into the context, though, of policies that were meant to promote economic growth and development. And so our assistance for Latin America has gone from $800 million when the President came into office to 1.6 billion, so it's a doubling of assistance. And that doesn't even include the very large grants that come -- the compacts that come with the Millennium Challenge Corporation, where Honduras, Nicaragua, El Salvador have compacts. And these are really large grants for development projects.

So our assistance and our trade have been very, very -- we've been very aggressive with them in Latin America, very active with them. But what was becoming clear was that somehow, the language that we used about our policies in Latin America did not seem to give sufficient weight to the fact that we know that these young, sometimes fragile democracies throughout the region, and Latin America has had an incredible wave of democratization -- that they're not going to remain democracies for very long unless they're able to deliver for their people on things like healthcare and education.

And so what the President's trip did was to emphasize the importance of not just security, which we do and which they all care a great deal about, not just anti-drug policy, which we do a lot of and which they care a lot about, not just trade and not even just aid, but an agenda that says that America understands that democracies have to deliver from the point of view of social justice, from the point of view of education and health for their people. And that's a positive message for Latin America and I think it was very well-received.

The other overarching part of it is that somehow, people thought that we were saying we couldn't deal with governments from the left side of the political spectrum; no, by no means; Chile; you've just seen the extraordinary relationship with Brazil that's developing; Uruguay -- with Vazquez in Uruguay. We can deal with anybody in the political spectrum. The question is, do they govern democratically, do they respect their neighbors, and are they prepared to try and deliver for their people. That's really -- that's the set of issues.

Brazil is a part of that, but it's also a little bit sui generis because Brazil is such a dominant power in the region. It's a large multiethnic democracy emerging as a force in the region and globally that the -- that relationship I've described as one of regional and global partnership. And so you saw that we, with Brazil, are doing not just the biofuels initiative, which probably will give us with Brazil an agenda for Central America and for other parts of the region, but also globally, to work with them on what are admittedly small but important projects in Guinea-Bissau and now in Santa Fe and Principe.

So it's a very comprehensive agenda in Latin America. The President has been to Latin America eight times as President, five times to Mexico. So it's a very active agenda and I think the President's trip gave us a chance to highlight some of the aspects of the policy.

MR. MCCORMACK: We have time for one more question.

SECRETARY RICE: Yes.

QUESTION: Hi, I'm Tom Donlan from Barron's. Could you apply those standards to our understanding of the relationship with Russia and particularly, their willingness to treat their neighbors well and their willingness to deliver to their people? And I would add a fourth standard for you to consider, which is, will they treat American investors and investing companies properly?

SECRETARY RICE: Yeah. Well, let me start out by saying we have a pretty good strategic relationship with Russia, in that we've been able to cooperate on Iran, we obviously are cooperating on North Korea. We -- on the kind of global issues, nonproliferation, we have a major effort on nuclear terrorism, on the kind of big non -- the big global issues, we actually, on a kind of state-to-state relationship, we do relatively well.

Tensions do arise when we are dealing with issues that are, in some ways, either a holdover from the Cold War or a holdover from the end of the Soviet Union. So the fact that we have actively pursued and intend to continue to actively pursue very good relations with Russia's neighbors, which used to be part of the Soviet Union, we would like to see Russia see as the normal course of development between new democracies like Georgia and the United States. It's not easy and we say to the Russians, the rise of democracies on their borders should be an opportunity for them, not a danger to them, but it's not easy.

It's -- I understand that after so many decades, indeed so many centuries of a different kind of relationship with those countries, that seeing those countries emerge as free and independent states with their own set of international relations is sometimes difficult for Russia, but it's important for Russia to recognize that those states are going to be treated as equals and -- equals by the United States and not as client states of Russia.

There is then another layer, which is the issue of internal issues in Russia. And here, if I were to divide it into the two parts that you asked, on investor relations, the use of the oil card, the consolidation of Kremlin control over oil and gas, you know, I think it's something that bears watching because it is somewhat troubling and -- but it's going to be incumbent on Russia to demonstrate that rule of law actually does govern and -- or Russia is not going to, I think, get the kind of investment that it needs. It won't be because the United States tells people not to invest; it will be because boards of directors are concerned about whether or not their investment is safe.

Now it's a very attractive place to invest for a lot of reasons and I'm sure that there will be investments there, but Russia, if it is going to fully diversify and develop its economy, will have to have a predictable environment for investment. The final piece of that has to do with Russia's own internal development. I don't have any doubt that for a variety of reasons, Russia -- Russians are living better than they have for quite a long time. I think we just have to -- we should recognize that and that's a good thing. There are still enormous problems. There is the problem of demographics. The Russian -- Russia as a nation is seeing a precipitous decline in birth rate and not yet a concomitant rise in longevity. And so in fact, they do have problems, demographic problems that are growing.

But you can't help but be impressed in the big cities of the growth in not just ostentatious wealth, but also in the middle class. And I'm told, even though I've not had the opportunity to get outside of the big cities in quite a long time, that even outside of the big cities, you're starting to have some effect on people's lives. That's all good.

I would hope, though, that it doesn't come at the expense of a parallel development of a more pluralistic political system in which people who are now gaining a stake, for instance, all of those people who are going for 30-year mortgages now in Russia, which is one of the hottest things you can have in Russia -- those people will have their own political interest. And the ability of people, the people to organize themselves, to petition the government on their behalf, to have political activity that is not constrained by the state, to have institutions that are diverse and broad, to have the Kremlin not be the only source of power, but to have a strong and functioning Duma, to have an independent judiciary, to have a free and active media, those are all extremely important to the long-term development of Russia. And on that, I think there's no doubt that there's been some movement back.

And so when we discuss with Russia, we always discuss in the spirit of mutual respect, it's a great power, it's a great culture, it's a critically important power in international politics, but it is a country that is still in the midst of a really major transition. And so recognizing that transitions are up and down, you have to look at the trend line and on many aspects of internal development, I think the trend lines are positive. But in terms of the construction of a state that will be strong enough to govern, but not too strong so that it suppresses dissent and suppresses the ability of people to advocate on their own -- on behalf of their own political interests, I think there are some concerns.

Thank you. Thank you very much. It's good to be with you.