PM: Well it's great to be here in Washington to undertake this official visit to the United States. The United States is Australia's oldest strategic ally, our closest strategic ally, our strongest strategic ally. And of course the United States is the centre, or the engine room of the global economy.
Very much this visit is not just a reflection on the past of our relationship with the United States, as strong and strategic as that has been, but also to reflect on the strength of the future of that relationship as well. A large part of my reason for being here is to discuss with the US Administration the current state of the global economy, and also to engage with US policy makers on a coordinated global response to the current difficulties being experienced across global financial markets rolling through to the real economy. The United States, and the state of its economy effects the global economy and Australia is part of a global economy and our working families in Australia are directly affected by what happens here in the US.
On top of that of course, with the President tomorrow, I look forward to a wide ranging discussion on a range of other foreign policy and national security policy questions as well.
I conclude by saying, it is a great honour for Therese and myself to be extended such personal hospitality by the President to be able to stay here at Blair House. We thank him very much for that. And for the warmth and cordiality with which we have been received by representatives of the US Administration on our arrival here at Andrews, only a short time ago.
JOURNALIST: Prime Minister, was President Bush wrong when he says, now is not the time to withdraw troops from Iraq because by so doing, we would risk losing all we have gained in the surge?
PM:Well, as in my discussions with the Vice President prior to the election and the President of the United States prior to the election, and with the President on the phone since the election, our position on that has been made abundantly clear.
The challenge for the future, is how do we partner with America and our other friends and allies in providing other forms of assistance to the Government of Iraq. And that certainly was the nature of my conversation with Ambassador Crocker in Baghdad, General Petraeus in Baghdad and also with Prime Minister Maliki, of the Iraqi Republic when I was in Baghdad as well. We are confident of our policy settings, and I am confident we will do so in close coordination, consultation and harmony with strategic direction in the United States.
JOURNALIST: Mr Rudd you have outlined your goals for your overseas visit but there is criticism that it will take you out of the country for 17 days. Is it justified, the length of you visit?
PM:Well right now the global economy is going through a period of considerable pressure and global financial markets are going through a period of considerable crisis. The options are, when you are looking at the future of the global economy which affects Australian working families, to sit at home and watch the global financial crisis unfold on CNN or to get out here and do something about it.
My response is that, when the global economy, global financial markets have a roll through effect on working families at home, my responsibility is two fold. One to work with other international leaders on the best and most effective global response to that crisis, and second to argue strongly, the case of the underlying strengths of the Australian economy, with the business leaders around the world. And I think that is the right way to go.
JOURNALIST: Glen Stevens says that movements outside the RBA, banks lifting rates, that it's just life. Brendan Nelson says it's bordering on the insensitive. How do you see the comments?
PM:I haven't seen the text of the comments and I will look to detail of the speech. Of course our position has long been that when it comes to moves in interest rates above the official rates, that banks should be very, very cautious about what they do there. We have made it possible through measures already announced by the Treasurer for consumers to quickly and expeditiously move their accounts from one bank to the other so that consumers can walk with their feet. My view is strongly that Australian working families are under mortgage pressure and mortgage stress at present and that has been reflected I think in the unfolding data in recent times. Dennis you had a question before.
JOURNALIST: On Iraq and Afghanistan, what sort of extra help would you be looking at providing Iraq and would that include military training. And on Afghanistan, you are pressuring NATO to put in more troops, is it likely that we will (inaudible) more resources into Afghanistan as well?
PM:On the question of Iraq, what I discussed with President Maliki in Baghdad and it has been our position since then, is that for additional assistance from Australia we would see that primarily falling into the categories of economic and humanitarian assistance. If we were to provide assistance by way of additional training for the Iraqi military or police we would do so out of country. Now on the question of Afghanistan, we have a strong solid commitment (inaudible), about 1000 troops on the ground, and we believe that is adequate under current circumstances. While I would say this about our friends and partners in Europe and part of the reason I am heading off to Bucharest is to deal effectively with the position of various of our friends and partners in Europe. I think it is important that we all get together and shoulder the burden behind a common strategy which has this as its objective, entrenching a long term successful government in Afghanistan capable of stabilising the country.
JOURNALIST: Mr Rudd is the global financial crisis gotten so bad that regulators like APRA need greater powers to take over banks that are in strife?
PM:Right now, the Government through the Treasury is in rolling and continuing close consultation with the RBA, with ASIC and APRA on the best regulatory response at home. And can I say this, against the standard of regulatory arrangements elsewhere in the world, our arrangements are among the best, the absolute best in the world. That's point one. And secondly, when we are looking at the sub-prime crisis as it has unfolded across the world, our sub-prime exposure is quite marginal against those of other developed economies.
The key challenge for us and again a core reason, a core economic reason for my visit abroad is to speak with the US Administration, and tomorrow I am seeing the Secretary of the Treasury and the Chairman of the Federal Reserve, together with of course, the President himself and the Vice President. And similarly in the United Kingdom, and the various European leaders, and with the Chinese later, is how do we best develop an effective global response to what is an emerging global problem.
And if you go back to Alison's question before, you can either sit at home and watch this unfold on the tele, or get out there and do something about it.
JOURNALIST: (inaudible) criticism of the Australian led international force for not pursuing his attackers more quickly, what is your reply to that?
PM:I have not seen the text of what Jose has said, I spoke to him on the telephone the other day while he was still in hospital. Of course, apart from having visited him in hospital, but I don't think he has got an active recollection of that, given the state he was in at the time. I think our Australian forces handled this very effectively on the ground, I defend their absolute professionalism in how that was dealt with in very trying circumstances. The fact that Jose was able to be got to the international medical facility at the Australian base in Dili so quickly, frankly is a large part of the reason why we were able to help Jose pull through.
JOURNALIST: (Inaudible)
PM:No there was no such criticism in any conversation I have had with him.
JOURNALIST: Mr Rudd what message would you like the Reserve Bank to remind the banking sector of it's responsibilities in setting mortgage rates?
PM:The key question that all banks, all our commercial banks should bear in mind is that working families are under financial pressure. We have had 12 interest rate rises in a row. The impact which this has on an average mortgage which now, $230,000 - $240,000 means $2000 worth of monthly repayments, that's a huge slug on the family pay packet. Now, therefore, any commercial banks in responding to the needs of working families, needs to understand that these family budgets are under real pressure and some are in genuine mortgage stress.
Again I go back to how that connects with the period that I will be abroad. The global economy is impacting on global financial markets and through that, of course, we see the roll on effect in Europe and in parts of Asia and in particular in Japan. We need to be in the forefront of the global response to this challenge because if we are not we are simply being passive against a force which has the capacity to further effect working families at home. And I am not in the business of sitting at home on my hands, hoping it will all get better in the morning. My attitude is different, you get out there and you participate in the global solution. And the other part of it is, argue the Australian economy's case as a strong and robust environment in which international and global investors continue to place their money.
JOURNALIST: This seems a marathon trip, with a handful of time zones, a handful of climates.
PM:What are you tired out already?
JOURNALIST: I am interested, I mean it is a big challenge for you, how did you prepare for it?
PM:Look, this goes back to Alison's question before, let's go to I think the short term political point scoring being engaged in by Dr Nelson at home. This visit, 17 days, Mr Howard in his first term undertook a visit of exactly the same length and secondly, during that 17 day period, visited two countries alone. The United States and the United Kingdom. In a 17 day period I am visiting the United States, I am visiting the United Kingdom, the European Union and NATO and China. At a time of great global economic challenge and genuine crisis in financial markets, it is the right and responsible thing to do at this time. I think people just need to take a deep breath when we see such, basically you know, short term party politics being played when the nation has some long term strategic interests to deal with.
JOURNALIST: The Americans will be keenly interested in how you balance the relationship, the alliance here, with the growing relationship with China. What would you say to them?
PM:Well I have always been rock solid on our strategic alliance with the United States, anyone who has known me for the last twenty years will know that my position has not budged one inch on that. It will not budge one inch on that. You can prosecute a strong, close, strategic alliance with the United States, with a robust and expanding economic relationship with China. That is precisely what the United States itself is doing.
And you are getting cold, and I am getting cold, and I am going to go and have a kip. Goodnight.