1:58 P.M. EDT

PRESIDENT OBAMA:  Good afternoon, everybody.  Please have a seat.  It is my great pleasure to
welcome Prime Minister Cameron on his first visit to the White House as Prime Minister. 

We have just concluded some excellent discussions -- including whether the beers from our
hometowns that we exchanged are best served warm or cold.  My understanding is, is that the
Prime Minister enjoyed our 312 beer and we may send him some more.  I thought the beer we got
was excellent -- but I did drink it cold.  (Laughter.)    

Mr. Prime Minister, we can never say it enough.  The United States and the United Kingdom
enjoy a truly special relationship. We celebrate a common heritage.  We cherish common values. 
And we speak a common language —- most of the time.  We honor the sacrifices of our brave men
and women in uniform who have served together, bled together, and even lay at rest together. 

Above all, our alliance thrives because it advances our common interests.  Whether it’s
preventing the spread of nuclear weapons or securing vulnerable nuclear materials, thwarting
terrorist attacks, or confronting climate change, or promoting global economic growth and
development, when the United States and the United Kingdom stand together, our people —- and
people around the world -- are more secure and they are more prosperous.

In short, the United States has no closer ally and no stronger partner than Great Britain. 
And I appreciate the opportunity to renew our relationship with my partner, Prime Minister
Cameron.

In his campaign, David was known for his extensive town halls discussions with voters —-
“Cameron Direct.”  And that’s the same spirit that we had here today.  I appreciate
David’s steady leadership and his pragmatic approach.  And just as he’s off to an energetic
start at home, I think we’ve had a brilliant start as partners who see eye-to-eye on
virtually every challenge before us.

Great Britain is one of our largest trading partners, and we’re committed to long-term
sustainable growth that keeps the global economy growing and puts our people to work.  I told
David that my administration is working hard with the Senate to move forward as soon as
possible with our defense trade treaty with the U.K., which will be good for our workers and
our troops in both our countries. 

We reaffirmed our commitment to fiscal responsibility and reform.  David’s government is
making some courageous decisions, and I’ve set a goal of cutting our deficit in half by 2013.
 Tomorrow, I’ll sign into law the toughest financial reforms since the aftermath of the Great
Depression.  And I commend David for his leadership in Europe to rebuild confidence in the
financial sector.  Together, we’re determined to make sure the financial catastrophe that we
are emerging from never happens again.

We discussed the Middle East, where both our governments are working to encourage Israelis and
Palestinians to move to direct talks as soon as possible.

We discussed the continuing threat posed by Iran’s nuclear program.  On this we are united: 
The Iranian government must fulfill its international obligations.  The new sanctions imposed
by the U.N. Security Council, the United States, and other countries are putting unprecedented
pressure on the Iranian government.  And I thanked David for Great Britain’s efforts to
ensure strong European Union sanctions in the coming days.

Along with our P5-plus-1 partners, we remain committed to a diplomatic solution.  But the
Iranian government must understand that the path of defiance will only bring more pressure and
more isolation.

Finally, much of our discussion focused on Afghanistan.  After the United States, Great
Britain is the largest contributor of combat forces in Afghanistan, and British troops and
civilians have served and sacrificed in some of the most dangerous parts of the country.

This is not an easy fight.  But it is a necessary one.  Terrorists trained in Afghanistan and
the tribal regions along the Pakistani border have killed innocent civilians in both of our
countries.  And an even wider insurgency in Afghanistan would mean an even larger safe haven
for al Qaeda and its terrorist affiliates to plan their next attack.  And we are not going to
let that happen.

We have the right strategy.  We’re going to break the Taliban’s momentum.  We’re going
to build Afghan capacity so Afghans can take responsibility for their future.  And we’re
going to deepen regional cooperation, including with Pakistan.

Today’s historic Kabul Conference is another major step forward.  The Afghan government
presented —- and its international partners unanimously endorsed —- concrete plans to
implement President Karzai’s commitments to improve security, economic growth, governance,
and the delivery of basic services. The Afghan government presented its peace and
reconciliation plan —- which the United States firmly supports.  Agreement was reached on a
plan in which responsibility for security in Afghan provinces will transition to Afghan
security forces.  In addition, Afghanistan and Pakistan reached a historic agreement to
increase economic opportunity for people on both sides of the border. 

So these are all important achievements, and they go a long way toward helping create the
conditions needed for Afghans to assume greater responsibility for their country.  Indeed, over
the coming year, Afghans will begin to take the lead in security, and in July of next year will
begin to transfer -- we will begin the transfer some of our forces out of Afghanistan.  And the
Kabul Conference shows that the Afghan -- that Afghanistan has the support of the international
community, including the United States, which will remain a long-term partner for the security
and progress of the Afghan people.

As we go forward, we want to honor our fallen warriors with the respect and gratitude that
they deserve —- whether it’s here at Dover, or in the small British town of Wootton
Bassett, where people line the streets in a solemn tribute that represents the best of the
British character.  With pride in their service and determination to carry on their work for a
safer world, I am confident that we can be worthy of their sacrifice.  And I am confident that
with my partner and friend, David Cameron, the special relationship between our countries will
only grow stronger in the years to come. 

Mr. Prime Minister.

PRIMER MINISTER CAMERON:  Well, first of all, can I thank you, Mr. President, for welcoming me
so warmly to the White House today.  Thank you for the meeting, for the lunch that we had, and
also for the tour of part of your home.  I have to say, I was most impressed by how tidy your
children’s bedrooms were.  (Laughter.)  And I think if the President of the United States can
get his children to tidy their bedrooms, then the British Prime Minister, it’s about time --

PRESIDENT OBAMA:  You can do it.

PRIME MINISTER CAMERON:  -- he did exactly the same thing.  (Laughter.) 

PRESIDENT OBAMA:  You have to give them some notice, that’s the only thing.  (Laughter.)

PRIME MINISTER CAMERON:  Right.  Well, they’ve got notice --

PRESIDENT OBAMA:  Tell them the Prime Minister is coming.  (Laughter.) 

PRIME MINISTER CAMERON:  They should be in bed by now, but if they’re not they have notice. 
(Laughter.) 

I think we did have a very valuable opportunity today to discuss in real depth a strong and a
shared agenda on Afghanistan, on global economic recovery, and on the Middle East. And this
relationship isn’t just, as you put it, an extraordinary special relationship.  To me, it is
also an absolutely essential relationship if we are going to deliver the security and the
prosperity that our people need.  And I thought again today in our discussions just how closely
aligned our interests are on all of the issues that we discussed.

First, on Afghanistan, there is no clearer, no more tangible illustration of Britain and
America standing shoulder to shoulder in our national interest than this mission that we are
engaged in together.  We have British troops working to an American commander in Helmand, and
we have American troops working to a British commander in Kandahar. 

Today, President Obama and I took stock of progress in this vital year.  We reaffirmed our
commitment to the overall strategy.  A key part of that is training the Afghan national army
and police so they can provide security for their country and our troops can come home. 

We also agreed on the need to reinvigorate the political strategy for Afghanistan. 
Insurgencies tend not to be defeated by military means alone.  There must also be political
settlement.  And to those people currently fighting, if they give up violence, if they cut
themselves off from al Qaeda, if they accept the basic tenets of the Afghan constitution, they
can have a future in a peaceful Afghanistan.

There is real progress.  Last weekend, the first Afghan-led military operation took place
successfully in Helmand, Afghans defending themselves.  And today, as Barack has just said, for
the first time in decades, the government of Afghanistan has hosted an international conference
on its own soil.  Over 40 foreign ministers and 80 delegations assembled in Kabul to monitor
progress and drive forward the international strategy.  That is a real achievement, and we
should congratulate President Karzai on it.

President Obama and I also discussed the economy.  We're both taking action that our countries
need.  Our destination is a strong and stable growth, a sustained economic recovery, and a
reformed financial system that will never again be open to the abuses of the past.  We are
confident that the right steps were taken at the Toronto G20 summit to help achieve that.

The Middle East was the third area that we focused on today. We both want a secure, peaceful
and stable Middle East.  And that means two things:  First, as Barack has just said, Iran must
give up its pursuit of a nuclear weapon.  We urge the Iranian regime to resume negotiations
with the international community without delay.  It’s not too late for it to do so.  America
and Britain, with our partners, stand ready to negotiate, and to do so in good faith.  But in
the absence of a willing partner, we will implement with vigor the sanctions package agreed by
the United Nations Security Council, and in Europe we will be taking further steps as well.

Second, we desperately need a two-state solution between Israel and the Palestinians that
provides security, justice and hope.  As we were discussing over lunch, it is time for direct
talks, not least because it is time for each, Israel and Palestine, to test the seriousness of
the other.

On BP, which we discussed at some length, I completely understand the anger that exists right
across America.  The oil spill in the Gulf of Mexico is a catastrophe -- for the environment,
for the fishing industry, for tourism.  I've been absolutely clear about that.  And like
President Obama, I've also been clear that it is BP’s role to cap the leak, to clean up the
mess, and to pay appropriate compensation.  I'm in regular touch with senior management at BP,
and the President is, too, to make sure that happens.  And the progress that's been made to cap
the leak is a step in the right direction.

Equally, of course, BP is an important company to both the British and the American economies.
 Thousands of jobs on both sides of the Atlantic depend on it.  So it’s in the interest of
both our countries, as we agreed, that it remains a strong and stable company for the future. 
And that's something we discussed today.

And let us not confuse the oil spill with the Libyan bomber. I’ve been absolutely clear
about this right from the start, and in our meeting we had what we call a “violent
agreement,” which is that releasing the Lockerbie bomber, a mass murderer of 270 people, the
largest act of terrorism ever committed in the United Kingdom, was completely wrong.

He showed his victims no compassion.  They were not allowed to die in their beds at home,
surrounded by their families.  So in my view, neither should that callous killer have been
given that luxury.  That wasn’t a decision taken by BP; it was a decision taken by the
Scottish government.  We have to accept that under the laws of my country, where power on
certain issues is devolved to Scotland, this was a decision for the Scottish Executive, a
decision that they took. 

I know that Senator Kerry’s committee is looking into these issues.  My government will
engage constructively with those hearings.  And, indeed, my foreign secretary has already set
out the government’s position.

So let me thank you again, Barack, for hosting me today.  While at the World Cup, our teams
could only manage a score draw. I believe our relationship can be a win-win.  And, yes, I did
enjoy drinking the 312 beer -- cold -- during the World Cup.  (Laughter.)  I enjoyed it so much
that when I watched Germany beat Argentina, I actually cheered for Germany.  That's something
that's a big admission for a British person to make, so the beer is obviously very effective. 
(Laughter.)

But what you -- what you said, Barack, though, about British and America soldiers fighting
together, sometimes dying together, serving together, is absolutely right.  And we should never
forget that -- whether it’s on the beaches of Normandy, whether it’s in Korea, whether in
Iraq, or whether now in Afghanistan.

Our relationship is on that has an incredibly rich history. It is based on ties of culture and
history and, yes, emotion, too.  But for all those things, I think it has also an incredibly
strong future that is based on results -- results of a positive partnership of working
together, agreeing where we agree; when we have disagreements, working through them and coming
to a fair conclusion.  It’s a partnership that I profoundly want to make work as well as it
possibly can in the years that I’m Prime Minister of Britain and with you as President of the
United States. 

So thank you again for welcoming me here today.

PRESIDENT OBAMA:  Thank you, David. 

With that, we’re going to take a few questions.  And I’m going to start with Mimi Hall of
USA Today.

Q    Thank you, Mr. President and Mr. Prime Minister.  I wanted to ask you a little bit more
about BP.  You mentioned, Mr. Prime Minister, your decision to cooperate, et cetera, but you
said we shouldn’t confuse the two.  Have you flatly ruled out opening a government
investigation into the events around the release of the bomber? 

And, President Obama, how do you feel about a congressional investigation into this?  Would
you like to see that happen, or do you think that confuses the two events?

PRESIDENT OBAMA:  Well, why don’t I start off and I’ll throw it over to David.  I think
all of us here in the United States were surprised, disappointed, and angry about the release
of the Lockerbie bomber.  And my administration expressed very clearly our objections prior to
the decision being made and subsequent to the decision being made.  So we welcome any
additional information that will give us insights and a better understanding of why the
decision was made.

But I think that the key thing to understand here is that we’ve got a British Prime Minister
who shares our anger over the decision, who also objects to how it played out.  And so I’m
fully supportive of Prime Minister Cameron’s efforts to gain a better understanding of it, to
clarify it.  But the bottom line is, is that we all disagreed with it.  It was a bad decision. 
And going forward, that has to inform how we approach our relationship with respect to
counterterrorism generally.

Now, one of the things that I want to emphasize that I think may get lost in this current
debate is the extraordinarily strong ties between our two countries when it comes to fighting
terrorism.  We probably have the best coordination and cooperation of any two countries in the
world.  And those relationships are vital and they keep people safe on both sides of the
Atlantic. 

And I want to make sure that even as we may express concern about what happened with respect
to the release of this particular individual, that we stay focused on the cooperation that
currently exists and build on that cooperation, to make sure that there is no diminution of our
joint efforts to make sure that the kinds of attacks that happened over Lockerbie do not happen
again.

PRIME MINISTER CAMERON:  Well, I agree with actually what’s been said about the importance
of the security cooperation -- something we discussed today.  On Megrahi, look, I'm not
standing here today and saying it was a bad decision to release Megrahi because I'm here.  I
said this a year ago, at the time, that it was a bad decision.  It shouldn’t have been made. 
The British government, as well, should have been clear that it was a bad decision, rather than
going along with it.  I took that very clear view.  This was the biggest mass murderer in
British history and there was no business in letting him out of prison.

In terms of an inquiry, there has been an inquiry by the Scottish Parliament into the way the
decision was made.  The British government -- the last British government -- released a whole
heap of information about this decision.  But I've asked the Cabinet Secretary today to go back
through all of the paperwork and see if more needs to be published about the background to this
decision.

But in terms of an inquiry, I'm not currently minded that we need to have a U.K.-based inquiry
on this -- partly for this reason:  I don't need an inquiry to tell me what was a bad decision.
 It was a bad decision.  And if you like, the big fact that's changed over the year that makes
it an even worse decision is the fact that, of course, Megrahi is still free, at liberty, in
Libya, rather than serving the prison sentence in Scotland, as he should be doing.

So that's what we're going to do, is go back over this information, see if more needs to be
published, and of course, in terms of the congressional hearing, make sure that proper
cooperation is extended to it.

James Landale.

Q    Just to stay on that subject, if we may.  Mr. Prime Minister, first of all, would you be
prepared to talk to your predecessors, Tony Blair and Gordon Brown, to get there agreements to
release any documents if they are relevant to the paper search that the Cabinet Secretary will
undergo?

And, Mr. President, can I ask you -- the Prime Minister says he opposes an inquiry.  Hillary
Clinton has demanded an inquiry. Where do you stand?

PRIME MINISTER CAMERON:  Well, first of all, on the documents, the proper process here is that
the Cabinet Secretary should look back over this decision and the circumstances surrounding it,
should identify those documents that should be published.  It should be right that ministers in
the previous government should be consulted about the publication of those documents.  And, of
course, we will consult with them over that.

But in my view, there is absolutely no harm to be done in giving the fullest possible
explanation of the circumstances surrounding this decision.  I think the key thing, though, to
remember is that in the end it was a decision by the Scottish Executive. 

On the issue of an inquiry, as I said, I'm not currently minded to hold an inquiry because I
think publishing this information, combined with the inquiry that has already been, will give
people the certainty that they need about the circumstances surrounding this decision.  But the
key thing is to get the information out there so people can see.  But I don't think there’s
any great mystery here.  There was a decision taken by the Scottish Executive -- in my view, a
wholly wrong and misguided decision, a bad decision, but the decision nonetheless. That's what
happened.  And I don't think we need an extra inquiry to tell us that that's what happened. 
But the information, as I said, will be gone over and published, as appropriate.  And of
course, I'll be consulting with previous ministers and prime ministers, as you should do in the
normal way.

PRESIDENT OBAMA:  I think the simple answer is we should have all the facts; they should be
laid out there.  And I have confidence that Prime Minister Cameron’s government will be
cooperative in making sure that the facts are there.  That will not negate the fact that, as
the Prime Minister indicated, it was a very poor decision and one that not only ran contrary
to, I think, how we should be treating terrorists, but also didn’t reflect the incredible
pain that the families who were affected still suffer to this day.  And my administration is in
regular contact with these families, and this was a heartbreaking decision for them that
reopened a whole host of new wounds. 

So my expectation is, is that the facts will be out there and, as David indicated, with all
the facts out, I think we're going to be back to where we are right now, which it was a
decision that should not have been made and one that we should learn from going forward.

Laura Meckler.

Q    Thank you.  Mr. President, in your opening statement you referred to the fact that the
British government has been taking some very tough steps towards -- to get their budget in
order, and you said you had committed to cut the deficit in half. Could you talk about whether
you think that those decisions are going to be -- the decisions that they’re making there are
going to be needed to be made here on a similar level beyond pledges?

And, Mr. Prime Minister, specifically could you address the matter of what role BP had in
lobbying for the release of this man, and whether an inquiry or the review that you’re
planning is going to look at that specific question?  Thank you.

PRESIDENT OBAMA:  When I came into office in January of 2009, I was very clear at the time,
even before we knew the severity of the recession that we would experience, that we have a
structural deficit that is unsustainable, and that for our long-term growth and prosperity we
are going to have to get a handle on that.  I talked about that during my campaign.  I talked
about it in the days after I was elected.  I talked about it after I had been sworn in.

We had an emergency situation on our hands, and so the entire world, working through the G20,
coordinated in making sure that we filled this huge drop-off in demand.  We got the economy
growing again.  And we had to take a number of steps, some of which were unpopular and that,
yes, added to the short-term deficit.

What I also said at the time was we are then going to make sure, number one, that we pay down
whatever additional deficit had been added as a consequence of the Recovery Act and other steps
that we had to take last year.  But then we’re still going to have to go back and deal with
these long-term structural deficits. 

And, in fact, in the first G20 visit that I made, in April to England, I was very clear to the
rest of the world that what they cannot rely on is an economic model in which the United States
borrows -- consumers in the United States borrow, we take out home equity loans, we run up
credit cards to purchase goods from all around the world.  We cannot alone be the economic
engine for the rest of the world’s growth.  So that rebalancing ended up being a central part
of our long-term strategy working with the G20.

Now, what we’ve done is we’ve initiated a freeze on our domestic discretionary budget.  We
are on the path to cutting our deficits in half.  We have put forward a fiscal commission that
is then going to examine how do we deal with these broader structural deficits.  So this
isn’t just an empty promise.  We’ve already started taking steps to deal with it, and
we’re going to be very aggressive in how we deal with it.

Now, our two countries are in slightly different situations. Their financial situation is
slightly different; their levels of debt relative to GDP are somewhat higher.  And as David and
I discussed when we saw each other in Toronto, the goal here is the same, and we’re all
moving in the same direction.  But there’s going to be differentiation based on the different
circumstances of different countries in terms of how they approach it tactically and at what
pace. 

But I can assure you this, that my administration is squarely committed not just to dealing
with the short-term deficit and debt -- which in some ways is the least troubling aspect of
this problem -- what we’re going to have to tackle are some big structural reforms that are
going to be tough.  And they're going to be that much tougher because we’re coming out of a
recession as we do it.  But I think that as we continue to see economic growth, as we continue
to see the economy heal from last year, that the American people are going to want to approach
this problem in a serious, realistic way.  We owe it for the next generation. 

And my hope is, is that we’re going to end up getting a bipartisan solution to this thing
that is realistic.  And one concern that I have obviously is the politics of deficits and debt.
 When I announced that I was in favor of this fiscal commission, at the time I had a number of
Republicans who were cosponsors of the legislation who suddenly reversed themselves because --
I suppose -- I supported it. 

And, fortunately, what I’ve seen so far, all the reports from the fiscal commission is that
people are serious about this. Both Republicans and Democrats on the commission are taking
their task seriously.  I think it’s going to be a good report, but is still going to require
some tough choices, and we’re committing to pursuing those tough choices after we get that
report.

PRIME MINISTER CAMERON:  Thank you.  You asked about the role of BP.  I mean, the role of BP
and any lobbying they might have done is an issue for BP and an issue that they should explain
themselves.  I mean, the decision to release Megrahi, though, was a decision made by the
Scottish government, and I haven’t seen anything to suggest that the Scottish government were
in any way swayed by BP.  They were swayed by their considerations about the need to release
him on compassionate grounds -- grounds that I think were completely wrong.  I don’t think
it’s right to show compassion to a mass murderer like that. I think it was wrong. 

But it’s a matter for BP to answer what activities they undertook.  But the Scottish
government made its decision and has explained its decision on many occasions and I’m sure
will explain it again.

I’m very keen that we are clear here that BP should, rightly, be blamed for what has
happened in the Gulf, and have real responsibilities to cap the well, to clean up the spill, to
pay compensation -- all of which they are getting on with, including putting aside the 20
billion pounds in the escrow account -- $20 billion -- sorry.  I think they’ve made good
progress on that and further progress needs to be made.

I think it’s important to separate that from the decision to release al-Megrahi, which, as I
say, was a decision made by the Scottish government and, as so far has been shown in
investigations by the Scottish parliament, was a decision which I wholly disagree with but,
nonetheless, was taken in an appropriate way.

I think we have a question from Tom Bradby.

Q    Mr. President, Tom Bradby, ITV News.  Quite a lot of people in the U.K. feel that your
determination as a country to continue to push for the extradition of computer hacker and 
Asperger’s sufferer, Gary McKinnon is disproportionate and somewhat harsh.  Do you think it
is time now to consider some leniency in this case?

And, Prime Minister, you’ve expressed very strong views on this matter, suggesting that Mr.
McKinnon shouldn’t be extradited.  Your Deputy Prime Minister has expressed even stronger
views.  Did you discuss that with the President today?  And if not, would now be a good moment
to share your views with us once again?

PRIME MINISTER CAMERON:  Shall I go?

PRESIDENT OBAMA:  Please, go ahead.

PRIME MINISTER CAMERON:  It is something that we discussed in our meeting.  I mean, clearly
there’s a discussion going on between the British and the Americans about this, and I don't
want to prejudice those discussions.  We completely understand that Gary McKinnon stands
accused of a very important and significant crime in terms of hacking into vital databases. 
And nobody denies that that is an important crime that has to be considered.  But I have had
conversations with the U.S. ambassador, as well as raising it today with the President, about
this issue, and I hope a way through can be found.

PRESIDENT OBAMA:  Well, one of the things that David and I discussed was the increasing
challenge that we’re going to face as a consequence of the Internet and the need for us to
cooperate extensively on issues of cybersecurity.

We had a brief discussion about the fact that although there may still be efforts to send in
spies and try to obtain state secrets through traditional Cold War methods, the truth of the
matter is these days, where we’re going to see enormous vulnerability when it comes to
information is going to be through these kind of breaches in our information systems.  So we
take this very seriously.  And I know that the British government does, as well.

Beyond that, one of the traditions we have is the President doesn’t get involved in
decisions around prosecutions, extradition matters.  So what I expect is that my team will
follow the law, but they will also coordinate closely with what we’ve just stated is an ally
that is unparalleled in terms of our cooperative relationship.  And I trust that this will get
resolved in a way that underscores the seriousness of the issue, but also underscores the fact
that we work together and we can find an appropriate solution.

All right?  Thank you very much, everybody.

PRIME MINISTER CAMERON:  Thank you very much.

END
2:31 P.M. EDT