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Inside Politics

`Non-Severability' Shapes Campaign Finance Battle; Bush Calls for Mideast Peace; Will McCain-Feingold Survive Political Process?

Aired March 29, 2001 - 5:00 p.m. ET

THIS IS A RUSH TRANSCRIPT. THIS COPY MAY NOT BE IN ITS FINAL FORM AND MAY BE UPDATED.

ANNOUNCER: Live from Washington, this is INSIDE POLITICS with Judy Woodruff.

(BEGIN VIDEO CLIP)

FRED THOMPSON (R), TENNESSEE: Presumably, if you had non- severability.

(END VIDEO CLIP)

(BEGIN VIDEO CLIP)

RUSS FEINGOLD (D), WISCONSIN: Non-severability is French for "kill campaign finance reform."

(END VIDEO CLIP)

ANNOUNCER: With one word and one vote, a defining moment for campaign finance reform. Also ahead:

(BEGIN VIDEO CLIP)

WILLIAM SCHNEIDER, CNN SENIOR POLITICAL ANALYST: Apparently, white men can jump!

(END VIDEO CLIP)

ANNOUNCER: Bill Schneider on some potentially iffy supporters of the Bush team.

And, as the Mideast conflict heats up even more, the president sends a message.

(BEGIN VIDEO CLIP)

GEORGE W. BUSH, PRESIDENT OF THE UNITED STATES: The signal I'm sending to the Palestinians is, stop the violence. I hope that Chairman Arafat hears it loud and clear.

(END VIDEO CLIP)

ANNOUNCER: Now, Judy Woodruff takes you INSIDE POLITICS. WOLF BLITZER, HOST: Thanks for joining us. I'm Wolf Blitzer, sitting in for Judy. Even the leading opponent of campaign finance reform now is predicting the McCain-Feingold bill will be approved by the U.S. Senate as soon as tonight. Within the past hour, one of the biggest and last obstacles to the legislation was defeated, that so- called "non-severability" amendment.

Our congressional correspondent Jonathan Karl has more on that vote and what comes next -- Jonathan.

JONATHAN KARL, CNN CONGRESSIONAL CORRESPONDENT: That's right, Wolf. By a vote of 57-43, the Senate defeated what McCain and Feingold saw as the last remaining significant hurtle between them and passing campaign finance reform in the Senate. They are now, they say, have gone one step in the right direction in terms of the legislative process, but one giant leap towards limiting the influence of big money on politics.

(BEGIN VIDEOTAPE)

KARL (voice-over): Senators Russ Feingold and John McCain made it clear that they saw the vote on so-called non-severability as the defining vote on campaign finance reform.

SEN. JOHN MCCAIN (R), ARIZONA: Have no doubt about what this vote's really about: if you vote for this amendment, you are voting for soft money. That's really what this vote is all about.

FEINGOLD: This vote on this amendment will decide whether this terribly unfortunate and corrupting system continues or not. This is a soft money vote. This is where the Senate takes its stand; this is the test.

KARL: Non-severability, in plain English, would have meant that if the courts strike down restrictions on issue ads by outside groups, the ban on soft money would also be thrown out. Democrats voting for it insisted they were just trying to ensure the law would be balanced.

SEN. JOHN BREAUX (D), LOUISIANA: They are part of the compromise. If you knock out one, you break the deal, and without this amendment, we will have perhaps only half of the deal being enacted into law; and the other half disappearing because of a court decision.

KARL: McCain and Feingold saw the vote as a test of whether or not Democrats truly want campaign finance reform. Top McCain aides had privately accused some Democrats of plotting to kill McCain- Feingold by supporting non-severability. Democratic leader Tom Daschle ridiculed the idea.

SEN. TOM DASCHLE (D-SD),MINORITY LEADER: It's a cynical plot. It's going to kill the bill, Jon. That's what you want to write, report that. You just did. It's cynical. We want to kill this bill.

KARL: Senator Mitch McConnell called the rejection of non- severability "stunningly stupid." But he acknowledged his opponents McCain and Feingold were on their way to victory.

SEN. MITCH MCCONNELL (R), KENTUCKY: Well, this bill is going to pass later tonight. And if I were a betting man, I'd bet it's going to be signed into law. So I just wanted to welcome you, my friends, to 100 percent hard money world.

(END VIDEOTAPE)

KARL: Now, McCain and Feingold have not won yet; they need a final vote in the Senate, which may come as early as tonight, and there are potential hurdles down the road, although they acknowledge they are lower hurdles. The biggest such hurdle coming up is the House of Representatives, which has already voted on two occasions to approve campaign finance reform.

But also has a leadership, the Republican leadership, that is adamantly opposed to the McCain-Feingold version of campaign finance reform -- Wolf.

BLITZER: Jon, we heard Senator Feingold suggest that the opponents -- his opponents, were, in his words, wily and that they still might have something up their sleeve. Is there anything specific tonight or tomorrow before the Senate winds up that could theoretically still derail the campaign finance reform legislation?

KARL: Well, if any of those opponents -- those wily opponents that Feingold has anything up their sleeve -- it will be Mitch McConnell; I know you'll be talking to him in just a few minutes, so he has a better take on that. But, certainly in the House of Representatives, Tom Delay, the ever powerful majority whip over there and Dennis Hastert, have both made it very clear that they're adamantly opposed to this bill, and they'll do whatever they can possibly do and they do have possible procedural steps they can take in the House to complicate matters.

But McCain and Feingold are confident that their counterparts in the House, Shays and Meehan, will be able to get this through.

BLITZER: OK, Jonathan Karl on Capitol Hill. Thank you very much. We're now joined by the leading opponent of campaign finance reform, Republican Senator Mitch McConnell of Kentucky.

MCCONNELL: The wily opponent.

BLITZER: I assume that's you, Senator Mcconnell, thank you for joining us. Is there any wily move you have up your sleeve today or tomorrow to try to derail this campaign finance reform legislation?

MCCONNELL: No, I think the wily moves are over. Actually, Wolf, I'm meeting next week with the other likely plaintiffs in the lawsuit. I'm operating now under the assumption that this may become law. It has a lot of constitutional problems; I'm going to be the plaintiff in the lawsuit, like Senator Jim Buckley was back in the mid-'70s, and we're planning the lawsuit.

BLITZER: Well, why are you so confident that President Bush is going to sign this bill into law? I want you to listen to what he said earlier today in a White House news conference. Listen to this:

(BEGIN VIDEO CLIP)

BUSH: This is a bill in progress. It's a bill that continues to change, and I'll take a look at it when it makes my desk. And if it improves the system, I'll sign it. I look forward to signing a good piece of legislation.

(END VIDEO CLIP)

BLITZER: As you know, Senator McConnell, the president's had a lot of reservations about McCain-Feingold in the past. Why do you think he's going to sign it now?

MCCONNELL: What I'm going to do is assume for planning purposes that the Senate passed bill becomes law, and I'm going to base the lawsuit on that. Obviously, the bill could improve in the House, it could improve at conference, and I hope that happens. There are some things that really we ought to do, one of which is to index the so- called hard money limits set back in the mid '70s when a Mustang cost $2,700. That was one of the few good parts of this bill, Wolf.

So, there are things that would improve the system. Taking the parties out of politics is not a step in the right direction. As I said on the floor, there won't be a penny less spent in the next election, it just won't be spent by the parties. That's not a step in the right direction.

BLITZER: But is there some political reason that you think the president might be reluctant to veto this legislation? Is he afraid that the political fallout would be that severe?

MCCONNELL: Nobody likes to be labeled as against reform, and the reform industries had real success. "The New York Times," the biggest mouthpiece in the country of corporate America; and "The Washington Post" continue to define anything that common cause says is reform as reform, and I don't think anybody is totally comfortable with being perceived as against reform. In fact, this is an absurd bill that rimracks the parties and doesn't take a penny out of politics.

BLITZER: Is there something you anticipate the House majority whip, for example, Tom Delay who was very outspoken over the weekend in condemning McCain-Feingold. Is there anything you think your Republican and perhaps other colleagues in the House of Representatives can do to derail this?

MCCONNELL: I sure hope so. Obviously, any effort to kill the bill that is successful I would be in favor of, unless it can be improved, and I wish Tom and Denny Hastert well.

BLITZER: Do you anticipate that there's a specific aspect of this McCain-Feingold legislation that is most likely to be ruled unconstitutional if it ever gets up to the Supreme Court?

MCCONNELL: Yes, the so-called Snowe-Jeffords language that it attempts to restrict the voices of outside groups in proximity to an election, there is a Second U.S. Court of appeals striking down precise language 18 months ago. And the Wellstone language, which also tends to make it tougher for other categories of outside groups to criticize us in proximity to election, no chance that will be upheld.

The real question mark, since there's never been a case on it, is whether the court will hold that political parties have the same kind of free speech and free expression rights that individuals do. And that will be the heart of the case to try to save nonfederal money. If we'd been interested, Wolf, in the so-called appearance of corruption, we would have capped soft money, not completely abolished it.

We know the court is open to caps; we've had caps on hard money for 26 years. What we should have done, if we were concerned about the size of soft money contributions, is provide a cap. Instead, what the Senate did was zero it out entirely, which means that, in even- numbered years, not only the national parties, but the state and local parties will have to operate in 100 percent hard dollars -- federal dollars -- it's absurd, it's a terrible proposal.

BLITZER: If, in the end, though, there is some provision of this law that is deemed unconstitutional, the rest of the law based on the non-severability clause -- the rest of the law will remain in effect; right?

MCCONNELL: It's severable. The non-severability effort failed, so it's fully severable. So, sure, the court could do what it did in the mid- '70s, which we were hoping to avoid, which was to pick and choose in the package and it left us with a crazy situation we have today.

BLITZER: Senator McConnell, we only have a few seconds left; but if you look down the road in the immediate weeks, and perhaps months, when would you anticipate this is going to be a done deal and the president will sign this into law?

MCCONNELL: Gosh, I have no idea. You know, the House obviously has to act. And we don't know when the House will act. About all I can do, Wolf, is to plan the lawsuit based upon the bill as it looked -- as it looked like, going out of the Senate.

BLITZER: OK, Senator Mitch McConnell, I want to thank you very much for joining us on this very busy day.

MCCONNELL: Thank you, Wolf.

BLITZER: Thank you.

And in addition to campaign finance reform, President Bush touched on a number of issues during a suddenly-called news conference earlier today.

On the subject of the violence in the Middle East, Mr. Bush seemed to take a tougher line, as our White House correspondent, Major Garrett, explains. (BEGIN VIDEOTAPE)

MAJOR GARRETT, CNN CORRESPONDENT (voice-over): A new wave of bloodshed brought President Bush off the sidelines and into the middle of escalating violence and deepening mistrust.

BUSH: The tragic cycle of incitement, provocation and violence has gone on far too long. Both sides must take important steps to calm the situation now.

GARRETT: The president urged Palestinian leader Yasser Arafat to publicly condemn violence, a message amplified in a phone call from Secretary of State Colin Powell to Mr. Arafat.

As for Israel, the president urged new Prime Minister Ariel Sharon to exercise military restraint, and relieve Palestinian economic suffering.

BUSH: Our goal is to encourage a series of reciprocal and parallel steps by both sides that will halt the escalation of violence. Provide safety and security for civilians on both sides.

GARRETT: On the ground, only violence was reciprocal. And the Palestinians accused Mr. Bush of tilting U.S. policy toward Israel.

HASSAN ABDEL RAHMAN, PALESTINIAN REPRESENTATIVE TO U.S.: We would like to see President Bush realizing how serious are the crimes that are being committed against the Palestinian population by the Israeli Army.

GARRETT: While the president said he will not become as personally involved in the peace process as his predecessor, the president has met with Mr. Sharon. And in the coming weeks, he will enlist the support of the Egyptians and Jordanians. But there's nothing on the White House calendar for Mr. Arafat.

BUSH: The signal I'm sending to the Palestinians is, "Stop the violence," and that -- I can't make it any more clear. And I hope that Chairman Arafat hears it loud and clear.

GARRETT: Analysts say the president's hands are tied until the Palestinians and Israelis return to peace talks.

JON ALTERMAN, U.S. INSTITUTE OF PEACE: The administration is not willing, at this point, to get directly involved and expose itself at a time when the sides themselves are not working towards reconciliation but, in fact, away from it.

(END VIDEOTAPE)

GARRETT: The White House wanted to avoid stepping into the Middle East quagmire so soon, but now the issue has risen to the top of the president's agenda. But he's not trying to preside over a peace deal, he's merely trying to stop what could be the next Israeli- Palestinian war -- Wolf. BLITZER: Major, the president, among other things, also met with the visiting German chancellor today, and there clearly is a major disagreement brewing between the Bush administration and -- not only Germany, but a lot of other European and Asian allies.

GARRETT: That's right, Wolf. At the end of his meeting with Gerhard Schroeder, the German chancellor, a joint statement was released, and it did try to highlight some areas of agreement: dealing with Russians, dealing with the European Strike Force, dealing with free trade.

But that statement made clear there is a deep division between the German government and the U.S. government about the Kyoto Protocol, which is a protocol created by the United Nations to deal with global warming. The Germans and many European leaders believe that is the best way to debate how the world, the industrialized world, can deal with greenhouse gases. The president made clear this week he does not feel the United States government should participate in any of those discussions. He explained why during a photo opportunity with Mr. Schroeder.

(BEGIN VIDEO CLIP)

BUSH: I will consult with our friends. We will work together. But it's going to be in what's in the interest our country, first and foremost, Terry. And the idea that somehow we're supposed to get enormous amounts of natural gas on line, immediately, in order to be able to conform to a treaty that our own Senate sent a very overwhelming message against, and many other countries haven't signed, makes no economic sense. It makes no common sense.

(END VIDEO CLIP)

GARRETT: Now, in his meeting with Mr. Schroeder, the president said he would continue to work with the German government and other Europeans to deal whit the issue of greenhouse gases, but, quite frankly, the Germans and other European leaders are at a loss to figure out what areas they could discuss on that would be better than the Kyoto Protocol. Clearly something that the Europeans and this administration will have to tackle in the coming weeks.

BLITZER: Major, we also heard, I guess a little nuance of a different tone from the president when it came to drilling for oil, natural gas, in the Arctic Natural Wildlife Reserve up in Alaska. He seemed to acknowledge there doesn't seem to be much of a political mood in Congress to go ahead and approve legislation which would authorize that kind of drilling.

GARRETT: That's exactly right, Wolf.

For the first time, the president made clear that he understands this is a tremendous political fight, one that members of his own party at this moment have no appetite for. And the best evidence of that can be found in the House and Senate budget resolutions, neither of which make any allowance in the next 10 years for any revenue to be derived from drilling in ANWR. That means House Republicans and Senate Republicans looked at the idea of whether they should fight for drilling in ANWR, said no, let's not do it, because we don't have the votes for it.

The president, when asked about this today, said something very interesting: "We've got a shortage of energy in America, and it doesn't matter to me where the gas comes from." Well, that's clearly a signal being interpreted on Capitol Hill that the president is backing away from drilling at the Arctic National Wildlife Refuge.

Harry Reid, senator from Nevada, the No. 2 Democrat, put out a press release this afternoon saying, "It's clear, it's over. The votes aren't there. The president's going to lose if he fights for ANWR" -- Wolf?

BLITZER: And finally, Major, getting back to our top story, the McCain-Feingold campaign reform legislation, which appears to be on the verge of final passage in the Senate. The president said he will sign campaign finance reform legislation into law, in his words, "if it improves the system."

Are you hearing from officials over there at the White House, that the political uproar would be so severe if he didn't sign it into law, that he basically has no choice at this point?

GARRETT: The political uproar would be large, they don't know exactly how large. But clearly the White House views campaign finance reform as an issue of governance, the president's ability to deal with the Congress of his own party, and deal with John McCain and try to suppress, if at all possible, the ongoing stories about the running feud between the two.

But also, there is a subtext, Wolf. It's all about the budget and the tax vote. The White House is giving a lot of moderate Republicans free reign to vote whatever they want to vote on the campaign finance reform bill. There were a lot of Republican defectors that killed all those amendments that Jonathan Karl talked about.

The White House has giving them a free pass because they need them. They want them on the budget vote next week. They're going to need them and they're going to want them when the full tax bill comes before the Senate in the coming months. The White House does not want to expend any political capital on campaign finance reform at the expense of getting the No. 1 priority for this administration through the House and the Senate, and that's the tax bill -- Wolf.

BLITZER: Major Garrett at the White House. Thank you very much.

There's a lot more to come on this edition of INSIDE POLITICS, including the latest on the arrest in the case of the New York doctor who performed abortions, shot down in his home more than two years ago.

But first, with all the talk about campaign finance reform, we head across the pond to find how the British pay for their election campaigns. And later: the political sequel to "White Men Can't Jump." Our Bill Schneider on one event that could make white males abandon President Bush. This is INSIDE POLITICS.

(COMMERCIAL BREAK)

BLITZER: Even as the Senate moves toward a final vote on campaign finance reform, both parties' fund-raising machines are humming along here in Washington. The Democratic National Committee holds its first major fund-raiser of 2001 tonight. It's hoping some 250 guests will fork over $2.5 million.

The National Republican Congressional Committee pulled in $7 million at a gala last night, a record for the group in a non-election year. Nearly 2,000 people attended, including the guest of honor, Vice President Dick Cheney. That group's counterpart, the Democratic Congressional Campaign Committee, raised more than $5 million earlier this month at a dinner that drew 1,200 guests.

For more on money and politics, let's turn now to our senior analyst Jeff Greenfield -- Jeff.

JEFF GREENFIELD, CNN SENIOR ANALYST: Well, Wolf, you know, the Senate debate all week has raised some very interesting questions: is there too much money in politics, or not enough? Is that money a corrupting influence, or is it free speech in action?

Here's another question that we didn't hear enough of: What would a really radically different system look like? Well, four years ago, when I was in London covering the last British general election, I found out.

(BEGIN VIDEOTAPE)

(BEGIN VIDEO CLIP, "CONSERVATIVE PARTY BROADCAST," 1997)

UNIDENTIFIED FEMALE: I'm hearing the future.

(END VIDEO CLIP)

GREENFIELD (voice-over): This is an election broadcast that the Conservative Party ran.

(BEGIN VIDEO CLIP, "CONSERVATIVE PARTY BROADCAST," 1997)

UNIDENTIFIED FEMALE: They do this to Britain.

(END VIDEO CLIP)

(BEGIN VIDEO CLIP, "LABOUR PARTY BROADCAST," 1997)

UNIDENTIFIED MALE: Now someone has emerged...

(END VIDEO CLIP)

GREENFIELD: And here's one from the Labour Party. (BEGIN VIDEO CLIP, "LABOUR PARTY BROADCAST," 1997)

UNIDENTIFIED MALE: He is the most talked about politician of his generation.

(END VIDEO CLIP)

GREENFIELD: They look very much like the political ads you see in the United States, but there's one very big difference: the parties didn't pay for the airtime. In fact, they can't.

PETER RIDDELL, "LONDON TIMES": It's impossible to buy TV or radio time in Britain. That's absolutely banned. We don't have a First Amendment in Britain, so that's not been a matter of controversy.

GREENFIELD: Instead, explains Peter Riddell, long-time political columnist for "The Times of London," the British parties are given free airtime. The money they raise is spent elsewhere.

Where? On posters, on billboards, on newspaper ads and on direct mail. But if the party leaders want to be on television, they have to do it with campaign appearances and press conferences, an almost daily event in the pre-election weeks.

As for the local candidates for Parliament, they don't get any TV time at all, and they're limited to about $15,000 in total campaign expenses. So, apart from a leaflet or two, they have to campaign the old-fashioned way: shaking hands, going door-to-door.

All this may sound like a reformer's dream, but remember, there are no limits to what individuals can give to a political party. Last time around, there were individual contributions as high as $2 or $3 million. And only recently has Britain developed disclosure rules for big givers, as well as absolute spending limits for the two major parties, about $22 million each for the next general election.

(END VIDEOTAPE)

GREENFIELD: Now, could anything like the British system work here? Well, no, mostly because our First Amendment would make it impossible to completely restrict the buying of TV time by candidates or interest groups. Also, the British system is much more party- based. Here in the United States, candidates for Congress, Senate are often independent, and sometimes even hostile to the national party, so they need to speak for themselves.

And many in Britain lament what they call the "Americanization" of their politics with the spread of polls and focus groups and polished media packages. Still, it is worth noting that without the ability to buy time, candidates for prime minister in Great Britain are forced to take their case to the press and to the public far more than are their American cousins -- Wolf.

BLITZER: Jeff, you know, as we take a look at this debate, and I know you have been watching it all day on campaign finance reform in the U.S. Senate, and it seems to be on the verge of final passage in the Senate. This has been the signature issue for Senator John McCain. And there has to be some major political fallout if he wins on this issue. Others are obviously going to lose. What does that set the stage for, if anything?

GREENFIELD: Well, you are not going to get me to do what you guys in Washington do, which is to speculate about a presidential elections three years and 10 months from now. In fact, I think what it has demonstrated is a certain amount of pretty good footwork on the part of the new administration.

You remember during the primaries, George W. Bush and John McCain had some really direct clashes about McCain's campaign finance law. Now, the president seems to indicate, you know, this is your turf you are dealing with, you're dealing with congressional, senatorial elections, you get a bill, and unless I think it's really awful, I'm going to pass it -- I'm going to sign it.

I think it shows two things: one, that whatever Mitch McConnell said, that this has all the power of static cling, the senators feel, most of them, that they can't not pass campaign finance reform and obviously, John McCain, who seems to have been like Don Quixote for a number of years, battling windmills, is going to have a substantial victory. It clearly makes him a force to be reckoned with in the United States Senate, perhaps on future issues like patients' bill of rights, where he also disagrees with the president.

BLITZER: Jeff Greenfield, thank you very much for joining us in New York. We appreciate it.

GREENFIELD: See you, Wolf.

BLITZER: Thank you.

And we will update some of the day's other top stories when INSIDE POLITICS returns, including the arrest of a man suspected in the death of a New York doctor who performed abortions.

Also, the Bush tax cut plan is off to a solid start in the House, but how will it fare in the divided Senate? We will look at the challenges facing the president and his plan later this hour.

(COMMERCIAL BREAK)

BLITZER: We will have more of the day's political news coming up, but now a look at some other top stories.

Three people are in custody, two in New York, one in France, in connection with the shooting of a noted obstetrician in 1998. Dr. Barnett Slepian had been targeted by anti-abortion groups before he was killed by a sniper at his home outside Buffalo, New York.

Among those in custody, anti-abortion activist James Charles Kopp, the alleged gunman. He was arrested today in France on a tip from the FBI. FBI Director Louis Freeh spoke about the case at a news conference here in Washington. (BEGIN VIDEO CLIP)

LOUIS FREEH, FBI DIRECTOR: This was a particularly egregious and violent action, if you remember that Dr. Slepian was murdered in his home in the presence of his four sons and his wife. So this is a case where the capture of the charged defendant is particularly gratifying for those of us who are charged with protecting the people and enforcing our laws.

(END VIDEO CLIP)

BLITZER: Also arrested in the Slepian case: two people in Brooklyn who allegedly harbored James Kopp and helped him escape overseas. The FBI is seeking Kopp's extradition.

A countdown to a possible pilot's strike appears to be nearing. Union pilots at Delta today rejected an offer of federal mediation. The move is likely to trigger a cooling-off period, meaning the pilots could strike by the end of April, unless President Bush intervenes.

An aviation expert says there's one simple solution to the rash of delays at the nation's major airports: Build more runways. That was part of the message delivered to lawmakers at a Senate hearing on the Republican-sponsored aviation delay prevention act. Among other things, the bill calls for speeding up the construction of runways at the possible expense of environmental review.

The president of the American Association of Airport Executives offered one way to overcome the problem.

(BEGIN VIDEO CLIP)

CHARLES BARCLAY, AVIATION EXPERT: We need add, over the next decade, the equivalent of 10 DFWs in order to handle the passengers that are coming. Now we don't have to add 10 new airports, but we have to add that kind of capacity to the system, or we're going to be in gridlock.

The good news is, as we have said in our statement, and Senator Rockefeller noted, the difference between gridlock and no gridlock is about 50 miles of runway nationwide. If we can add one, two-mile runway at each of the 25 congested airports that, pretty much, winds up doing it.

(END VIDEO CLIP)

BLITZER: An official with the airline's chief lobbying group, testified that delays are due more to the air traffic control system, not overscheduling.

Big news today from the World Health Organization. It says one of the three known strains of polio has apparently been wiped out. The last recorded cases of type 2 polio were in India in 1999. There are still more than 2,800 confirmed cases of polio worldwide each year. Another round of major layoffs announced today, this time in the automotive industry. Delphi revealed plans to slash more than 11,000 jobs, or about 5 percent of its workforce. The cuts will come through selling, closing, or consolidating nine plants. Delphi is the largest autoparts supplier in the United States, after being spun off as a division of General Motors in 1999.

A split day on Wall Street as a late-day rally propelled the Dow into positive territory, while the Nasdaq markets lost ground.

The Dow was losing ground until the last hour of trading. The market reversed course and ended the day up by almost 14 points. The Nasdaq couldn't turn around its losses and ended the day down more than 33 points.

There's more on what factors were moving the markets coming up on the "MONEYLINE NEWS HOUR" with Willow Bay. That's at 6:30 p.m. Eastern, right after INSIDE POLITICS.

Still ahead: Counting the potential Senate votes for the Bush tax cut plan. Also, can white men jump parties? Our Bill Schneider on the president's core support.

(COMMERCIAL BREAK)

BLITZER: Welcome back.

President Bush likes to say his tax cut plan is not too big, as some Democrats argue, and not too small, as some Republicans have said. But Mr. Bush's arguments, that his cuts are just right, face new obstacles, due, in part, to the slowing economy.

Here's CNN White House correspondent Kelly Wallace.

KELLY WALLACE, CNN WHITE HOUSE CORRESPONDENT (voice-over): President Bush reiterates this message: "Any tax relief this year must be part of his $1.6 trillion tax cut plan."

BUSH: Part of building confidence in our economy is not only to give the consumers a boost, but to have a plan that reduces rates for the long term. So that people who make investments, small business owners, the entrepreneurs, will have certainty.

WALLACE: His comments follow news the economy grew at a sluggish 1 percent in the last quarter of last year. Possibly adding momentum to the drive to pass a bigger tax-cut for this year. Democrats are pushing for an immediate $60 billion tax cut that is not part of the president's 10-year proposal.

REP. RICHARD GEPHARDT (D-MO), HOUSE MINORITY LEADER: They are not serious about providing relief this year, when it's most needed.

Their tax bill doesn't help people for another three to five years, in some instances eight years.

WALLACE: Still, the House of Representatives gave part of the president's plan a boost. With lawmakers eliminating the tax penalty on married couples and doubling the child tax credit. But Mr. Bush has a serious challenge ahead. With next week's first vote in the 50/50 Senate, on the general parameters of his budget and tax blueprint.

BUSH: There's a debate here in Washington, and it's really: do you want to increase the size of the federal government? Or do you want to give -- let people keep their own money?

WALLACE: The president has the support of 48 Republicans, Hill sources say. With Rhode Island's Lincoln Chafee planning to vote against it, and Vermont's Jim Jeffords undecided. On the Democratic side, Georgia's Zell Miller says he'll support it. Delaware's Tom Carper is undecided, Mr. Bush plans a visit to his state Tuesday, and Nebraska's Ben Nelson is also on the fence. Hoping to win him over, the president traveled to Nelson's state last month and called him on Wednesday.

(on camera): To attract centrist senators from both parties, the compromises is being shopped around capitol hill: Larger than the Democratic tax plan but smaller than the president's. Still, the administration says it is sticking with its $1.6 trillion tax price tag, and senior aides they are confident, in the end, the votes will be there.

Kelly Wallace, CNN, the White House.

(END VIDEOTAPE)

BLITZER: Our senior political analyst, Bill Schneider, has been looking at past elections and when what happens with the economy turns bad. He joins us now live. Bill, what happens?

SCHNEIDER: What happens? Well, you know, right now consumer confidence is up a bit. But with news of continuing layoffs, the polls show most Americans think the economy is headed for a recession. Now, suppose that happens. What would be the political consequences for President Bush?

(BEGIN VIDEOTAPE)

SCHNEIDER (voice-over): You know the old saying, "Like father, like son?" Well, President Bush's father suffered the consequences of a recession when he ran for reelection in 1992 and ended up getting just 38 percent of the vote. His son did 10 points better last year. But if the economy slides into recession, Bush, the son, could start looking a lot more like Bush, the father, did in 1992.

One constituency poses a particular threat: white men. Compare how Bush, the father, and Bush, the son, did with their white male homeboys. George W. got a solid 60 percent of the white male vote last year. His father's support had dropped to 40 percent eight years earlier. The difference was bigger for white men than for any other group. Apparently, white men can jump. A recession drives down their support. White men may not be the most politically correct constituency, but no Republican can survive without them. Look at what's happened to the Republican presidential vote among white men over the last 30 years. A Republican needs about 60 percent of the white male vote to win. Richard Nixon and Ronald Reagan did even better than that, pulling two-thirds of white men in 1972 and 1984. Bush, the father, initially, got elected in 1988 with 63 percent of the white male vote. Then came the recession and white men fled the GOP ticket.

Even Bob Dole, the ultimate white man, failed to break 50 percent of the white male vote in 1996. Bush, the son, finally got the number back up to 60 percent last year. Congressional Republicans are no less dependent on the white male vote. Here's the GOP house vote among white men, nationwide, since 1980.

From 1980 through 1992, white male support for House Republicans was usually in the low 50s. In 1994, the year of "the angry white man, " Republicans made a dramatic breakthrough, 63 percent of the white male vote.

In the last three Congressional elections, white male support for GOP candidates has hovered close to 60 percent. And Republicans have held on to their majority in the House. If you want to know why Republicans control everything in Washington today for the first time in nearly 50 years, the answer is the gains they have made among white men, gains that would be endangered by a recession.

(END VIDEOTAPE)

SCHNEIDER: The breakthrough in 1994 really had nothing to do with the economy. It had to do with Bill Clinton. White men turned against Clinton and his party. Clinton threatened their values, their sensibilities, their ethics and their guns.

BLITZER: If there were to be a recession, would it worse for President Bush than, let's say, for other presidents?

SCHNEIDER: I think it would, and there's a reason for that: I think Bush was born to wealth and privilege. Democrats can get away with electing presidents born to wealth and privilege, like Franklin Roosevelt and John Kennedy.

For a Republican, however, being well-born reinforces what's really the most damaging stereotype of the Republican Party, that it's the party of wealth and privilege. For all their pork rinds and country music, when a recession hits, the Bushes seem hopelessly out of touch. And white men sense that and flee.

BLITZER: Let's hope there is not a recession for any of us.

SCHNEIDER: We all hope.

BLITZER: Thank you very much, Bill Schneider.

SCHNEIDER: Sure.

BLITZER: Up next on INSIDE POLITICS: racial profiling in New Jersey. State lawmakers question how it was allowed to take place.

(COMMERCIAL BREAK)

BLITZER: Welcome back. Black and Latino drivers targeted by police. It was an issue in the presidential campaign last year, and now it's being investigated by the New Jersey state Senate.

CNN's Brian Palmer looks into the case and its implications for New Jersey and the nation.

(BEGIN VIDEOTAPE)

BRIAN PALMER, CNN CORRESPONDENT (voice-over): Testifying before a state senate panel, the New Jersey supreme court justice admitted again what minorities have charged for years.

JUSTICE PETER VERNIERO, NEW JERSEY SUPREME COURT: Racial profiling has existed for many years. I hope we can arrive at the day when this humiliating and illegal practice is stamped out.

PALMER: The committee investigators grilled the former state attorney general to determine what he knew about the practice and when he knew it. But under the panels sharp probing, Peter Verniero answered questions more than 150 times this way.

VERNIERO: I don't recall.

PALMER: Justice Verniero denied allegations he ignored evidence of racially motivated traffic stops by the state police for years.

VERNIERO: I testified truthfully in all prior appearances before this committee. I directed no person to conceal documents requested by the United States Department of Justice.

PALMER: Critics of the states handling of profiling want answers and action.

REV. WILLIAM RUTHERFORD, NAACP: Those at the top should be held accountable and should be called on the carpet for the actions of this powerful institution in our state, the New Jersey state police.

PALMER: In April 1998, the racial profiling issue exploded when two New Jersey troopers fired on a van carrying four men, black and Latino, during a turnpike stop, wounding three of them.

A year after the shooting, Verniero released a report admitting racial profiling was practiced by New Jersey state troopers, but investigators pressed him to determine if he knew about the practice long before the shooting. State police records from as early as 1998 showed that roughly 80 percent of drivers stopped on the New Jersey Turnpike were black or Hispanic, records Verniero had access to and former colleagues say they discussed with him. Racial profiling watchdogs weren't satisfied with Verniero's testimony.

REV. REGINALD JACKSON, BLACK MINISTERS COUNCIL: It's been a constant refrain of not being able to recall and not being able to remember. And it's unfortunate, because getting a handle on the issue of racial profiling in New Jersey, has become tantamount to trying to hold running water.

PALMER: Verniero's testimony is over, but the committee will continue to press for answers in to April.

Brian Palmer, CNN, New York.

(END VIDEOTAPE)

BLITZER: Still to come: the strategy on campaign finance reform. We'll hear from Adrian Walker of "The Boston Globe" and "The National Review"'s Ramesh Ponnuru, after the break.

(COMMERCIAL BREAK)

BLITZER: Welcome back. Joining us now to discuss the day's events, Adrian Walker of the "Boston Globe," and Ramesh Ponnuru of "The National Review." Thanks to both of you for joining us.

Adrian, on campaign finance reform, the vote in the Senate may or may not -- the final vote -- may or may not happen tonight or tomorrow, but for all practical purposes, as far as you are concerned, is this a done deal?

ADRIAN WALKER, "BOSTON GLOBE": That's certainly how it appears. I mean, the votes leading up to the big vote have gone in favor of campaign finance reform. President Bush has indicated that he's going to sign a bill, so it seems to be more or less a done deal.

BLITZER: And Ramesh, what does it mean? What does it mean specifically for President Bush, if in the end, he is reluctantly forced to sign McCain-Feingold into law?

RAMESH PONNURU, "NATIONAL REVIEW": Well, it means that he is signing the bill because it's the only way that he can veto McCain. That is, get McCain out of the news and out of his grill.

You know, otherwise this story continues, and McCain becomes -- gets -- is able to cast himself as a martyr, and Bush doesn't want that.

BLITZER: You think that is the case, Adrian? Is that your take on what is going on?

WALKER: Yeah. I think that is a lot of what is going on, but I think what's more important is the thing that McCain's campaign proved last year is that campaign finance reform is an issue that has real broad, popular support, and put to death the idea that it's just a boutiquey (sic) liberal issue.

BLITZER: You know, I know, Ramesh, that a lot of conservatives are very, very upset that McCain is going to win, apparently, on this issue. They are still hoping for some outside chance that it can go down in flames. Are their hopes unrealistic? PONNURU: Well, you know, you'd have to say, based on everything, as Adrian pointed out, you have to say that it's likely that this bill is going to pass in something close to current form, and be signed by the president.

The people who are opposed to the bill, their last hope is that Democrats, as that becomes more and more likely, are going to peel off of the bill in the House, and maybe when it comes back up after the House has done its magic, in the Senate.

BLITZER: You heard probably at the news conference, Adrian, today, that the president was asked about his relationship with John McCain, and said that he has a very good relationship. They are friends, he admires him a great deal. Though, if you speak to sources close to both the president and to Senator McCain, you don't get that sense, do you?

WALKER: Well, I think personally, he likes John McCain fine, but politically, for the past year, John McCain's been a big problem for him, and I think that it's clear that he is getting a little bit tired of it. I agree with Ramesh that he wants to sign this bill as means to probably make John McCain go away, at least as far as his political life is concerned.

BLITZER: If you take a look, Ramesh, at some of the issues in which they disagree: it's not just campaign finance reform, it's the patients' bill of rights, it's tax cuts, it's the issue of -- on guns, tobacco. There's a whole host of issues in which McCain and Bush simply disagree, isn't that the case?

PONNURU: Yeah, well, I mean, I think that the political direction both men have taken since the primaries last year has been different. President Bush has governed to -- a little bit to the right of what people might have expected, and McCain has moved left. So, it's not surprising that there has been tension between them.

BLITZER: We heard from our White House correspondent, Adrian, our correspondent Major Garrett suggests that what President Bush really wants now, and why he is probably going to sign McCain- Feingold, or some version into law, is to get on with his signature issues, which of course, involves tax cuts. Does the impact of the McCain-Feingold, if it passes, does that have an impact on the battle over tax cuts?

WALKER: I don't really see a great big link between the two. I mean, I think that there will be a tax cut in some form or another, and the real issue is how big it's going to be, but it's not really clear to me how signing campaign finance clears the field for tax cuts.

BLITZER: Does that have -- is there any linkage between the two, Ramesh?

PONNURU: Well, I do think that there are some in that -- well, I disagree with Adrian, I don't think there is a huge constituency in the public for campaign finance reform. I don't believe that people voted for McCain on that basis.

But if Bush were to veto that, would have real repercussions inside Washington, and would, I think, sort of poison the atmosphere. The press would be after him, and I think it would make it harder for him to get his tax cut through.

BLITZER: Ramesh, we're also seeing in these early weeks and months of the Bush administration -- the president is taking out some significant differences from former President Clinton on international affairs, on major international issues. What's happening, as far as you can tell?

PONNURU: Well, I mean, Bush made no secret during the campaign that he thought that the administration was in some of its policies a little woolly-minded, a little too trusting of international treaties and not concerned enough about American interests. And so, in a variety of places, from the ABM treaty to the Kyoto protocol, the administration is taking a much more negative view than the Clinton people did.

BLITZER: Is he on some thin ice, Adrian, as far as some of these international issues? For example, the environmentalists are all up in arms because he doesn't want to go forward and honor the Kyoto agreement.

WALKER: Yeah, I think this is a big problem for him. I mean, he turns on carbon dioxide emissions, he has just flip-flopped on this issue. He has broken a campaign promise to support reductions in carbon dioxide.

And the big problem is now we are going into an international conference with no position at all. We have nothing to replace our abandonment of the Kyoto accord.

BLITZER: The criticism, Ramesh, is that President Bush seems to be more concerned about the economy than he is about the environment, and that's going to generate perhaps some political fallout.

PONNURU: Well, let's keep in mind, though, Wolf, that the Senate, when it had a chance, voted 95 to zero back in '97 against the Kyoto protocol, at least a key provision of it. So I think it's going to be awfully difficult for Democrats to make a real partisan issue out of this.

BLITZER: All right. Ramesh Ponnuru and Adrian Walker, unfortunately we have to leave it right there. Thanks to both of you for joining us.

PONNURU: Thank you.

BLITZER: Thank you.

WALKER: Thank you.

BLITZER: And still to come: Iowa tries to ban lying on the campaign trail. And later: why President Bush is off to a rocky start with Europe.

(COMMERCIAL BREAK)

(BEGIN VIDEO CLIP)

UNIDENTIFIED MALE: This is a stunningly stupid thing to do, my colleagues.

(END VIDEO CLIP)

(BEGIN VIDEO CLIP)

UNIDENTIFIED MALE: And so, yes, it is a new world, but I happen to believe, Mr. President, it is a vastly better world.

(END VIDEO CLIP)

BLITZER: In the Senate, campaign finance reform appears to make it through the mine field, but a final vote still lies ahead.

Is President Bush getting an earful from U.S. allies angst about his global policy? And the drawing fallout from foot-and-mouth disease in Britain. Does Prime Minister Tony Blair fear political consequences?

ANNOUNCER: From Washington, this is INSIDE POLITICS, with Judy Woodruff.

BLITZER: Welcome back to INSIDE POLITICS. Judy is off this week. I'm Wolf Blitzer.

The U.S. Senate now appears on track toward approving the most sweeping changes in political fund-raising laws in a quarter century. Members are pressing toward a final vote on the McCain-Feingold legislation that would ban unrestricted donations to political parties known as "soft money."

The bill got a green light less than two hours ago, when the Senate rejected an amendment that would have voided all the major provisions of the bill if the courts ruled any one of them unconstitutional. It was a major victory for Senator John McCain, who already is looking ahead to a battle in the House.

MCCAIN: We're going to have a fight in the House. We're going to work with our House colleagues. It's not going to be easy. So it is a fact that it's passed twice through the United States House of Representatives by significant margins, basically what this bill is. So we look forward to working with our House members, and we don't underestimate the challenge, but we are guardedly confident that we will pass it through the House of Representatives. And we are pleased that the president said that he'd liked to sign a bill.

BLITZER: Senate opponents of the campaign finance reform bill are warning of dire days ahead.

MCCONNELL: So what have we done? We haven't taken a penny of money out of politics. We've only taken the parties out of politics. Mutual assured destruction.

BLITZER: Our congressional correspondent, Jonathan Karl, has been covering the reform debate. He joins us now life.

Jonathan, after all these failed efforts in the past, why does it appear now that McCain-Feingold will be approved by the Senate?

KARL: Well, this has been something that has come up year after year, and it's always failed year after year after year. The one thing that was different this year was John McCain. He came back from his presidential campaign last year as not just another senator, a senator from Arizona, but as a national figure. And he fought hard, even just to get a chance to bring this up in the U.S. Senate.

If you remember, Wolf, at the start of the year, he said he wanted to get this on the floor of the Senate, wanted to have this debate. He threatened to tie the Senate up in knots, block the president's agenda, to make it happen. So that was the significant change. He came back a national figure.

Also, Wolf, one other thing: five new Democrats in the U.S. Senate this year. That also meant that there was more momentum for campaign finance reform.

BLITZER: Jon, that vote earlier today on what was called the non-severability clause -- does that show that Democrats were not necessarily out to secretly kill campaign finance reform, as some, as you know, had been suggesting?

KARL: Well, it certainly shows that if they had been, they aborted the efforts. And I'll tell you, I got a call earlier today from Paul Wellstone after that vote. If you remember, Paul Wellstone, earlier this week, had proposed an amendment that if it passed, that many Republicans voted for because they felt it was unconstitutional.

Now, it was after that vote that many said the Democrats were colluding with the Republicans to try to kill campaign finance reform. Paul Wellstone certainly feels vindicated by this vote, because most Democrats stood with McCain and Feingold on this constitutional question, this so-called non-severability. So, certainly, Paul Wellstone believes that that proves that there was absolutely no collusion between Democrats and Republicans.

BLITZER: At this early stage, is there any Democrats out there who may have shot themselves on the foot on this issue?

KARL: Well, there are clearly Democratic strategists who feel that's exactly what happened. They feel that now the Democrats have to make up for all that soft money. If this becomes law, they'll have to make up for all that soft money that they won't be able to raise, that they've been so good at raising. And several Democrats who are up for reelection next year with tough races are nervous about that.

I've been told that Senator Tom Harkin, who is up for reelection in Iowa next year, is one of those who had privately expressed concerns to colleagues that this is going to make things very difficult for Democrats.

BLITZER: We heard Senator McCain suggest that it's not necessarily a done deal in the House of Representatives, even though it's passed in various forms several times in years past. But as far as what you are hearing, is it a done deal that if it does pass the House and the Senate, the president will sign it into law?

KARL: Well, the president has been making it very clear, as you know, Wolf, over the last few days, that he has no intention -- or does not want to veto campaign finance reform. But he has clearly stopped short of promising to sign the McCain-Feingold bill.

So it is still unclear, although Mitch McConnell, who I spoke to just a short while ago, said he clearly does not expect a presidential veto on this. He says if it gets to the president's desk, it's his prediction that the president will indeed sign it into law.

BLITZER: Let's turn to another matter today. The junior senator from New York, Hillary Rodham Clinton, today introduced some legislation -- cosponsoring some legislation. What's that all about?

(LAUGHTER)

KARL: That was a very interesting kind of side show development here, while the campaign finance reform debate was going on. Arlen Specter sponsored a bill, a bill on the pardon issue. This was a bill in direct response to the controversial pardons that Bill Clinton did in the waning hours of his presidency. And it's legislation that is now cosponsored by Hillary Rodham Clinton.

And what it would is -- essentially, it would force presidents to disclose donors to their presidential libraries. And it would also say that anybody advocating on behalf of somebody getting a pardon would have to register as a lobbyist.

Wolf, very interesting, because President Clinton himself had been arguing against disclosing the donors to his library. And also interesting because if this bill were to become law, if it had been law, then Hillary Rodham Clinton's own brothers, Tony and Hugh, would have had to register as lobbyists because advocating on behalf of people seeking presidential pardons.

BLITZER: A very busy Jonathan Karl on Capitol Hill. Thanks once again for joining us.

For more now on campaign finance reform and Senate politics, we're joined by Stuart Rothenberg of the "Rothenberg Political Report," and Charlie Cook of the "National Journal." Thanks for joining us.

First to you, Stuart, on the campaign finance reform -- is it a long road out there until it's signed into law, or a short road?

STUART ROTHENBERG, "ROTHENBERG POLITICAL REPORT": I think it could be a long road, Wolf. Some people are talking as if this is a done deal, now. Yes, the House has passed this in the past, but this is a different House, because now Democrats on Capitol Hill in the House are concerned about the bill and about their ability to raise money.

You know, senators can raise money, hard dollars, a lot more easily than can House members, and I think there are -- including senior Democrats in the House side -- that are nervous about this bill.

BLITZER: So there's a lot of mixed feelings out there, right?

CHARLES COOK, "NATIONAL JOURNAL": Absolutely. And then after the House, then it goes into a conference committee, which could end up being a black hole. Then it goes to the president, who either signs it or doesn't sign it. And then finally, the question is how much of this survives a constitutional challenge, because Mitch McConnell is already headed to court. So it's -- this thing is a long way from being done.

BLITZER: Having said that, though, it's still a huge win for John McCain and Russ Feingold.

ROTHENBERG: And it's remarkable that they held their coalition together through all these attempts to amend the legislation and kill it. It's impressive, it suggests significant influence for Senator McCain, and obviously problems in the future for the president. But I agree with Charlie. I think the conference committee could ultimately be the black hole here.

COOK: And the efforts to kill this thing, I mean, that were public, were tip of the iceberg. I mean, there was a lot taking place, particularly on the Democratic side, to try to derail this thing.

BLITZER: If the president for some reason, were not to sign it into law, Stu, what kind of political grief might he face?

ROTHENBERG: Well, he'd need an awful good reason, Wolf. I think the White House is very sensitive to this. The don't want to be seen as blocking campaign finance reform. The president's position is not exactly crystal clear. He keeps saying that he intends to sign something, wants to sign something, but he hasn't indicated that this is the something. But I think he is under considerable pressure, as we heard from Jonathan. The White House doesn't want to stand in the way. So I think if he didn't sign it, it would cause some significant flak.

COOK: I think if I worked for President Bush, I would tell him, "Sign it, you'll get a lot of grief. You'll get a lot of grief if you don't sign it, number one. Number two, most -- a lot of it's going to get thrown out by the courts anyway. And finally, just move on. It's not worth taking the hit. And finally, the Democrats could find themselves really doing themselves in, because I think a strong case could be made that Democrats are a lot more hooked on soft money than Republicans are, and this will hurt Democrats more.

BLITZER: Let's talk about some practical fallout if, in fact, McCain-Feingold goes into effect for the 2002 elections. Where is there going to be some immediate fallout as far as you can tell, Stu?

ROTHENBERG: I think the big question would be on Democratic House candidates. Can they raise the money? They're not the majority party in the House of Representatives. It's hard for House members to get the visibility to raise money. I think that would be the big question mark.

COOK: And the thing is, where will this money go that was going to these outside groups? At least until those provisions are declared unconstitutional. And the thing is, money finds a way into politics, and there's no way you can stop it. It's like water going downhill. And I can't imagine that this would cause significant change in how money and politics intersect.

ROTHENBERG: I talked to a media consultant who has done a lot of soft dollar advertising for one of the parties, and I asked him, well, does this mean your business is drying up for the cycle? He just roared. He thought that was really funny. He said "No, no, we'll have plenty of ads to cut. Don't worry."

BLITZER: Anybody looking already at some unintended consequences of what this might bring? The 1974 reforms resulted in a lot of changes, nobody foresaw them, including soft money.

COOK: Well, absolutely. And it's the whole area of soft money. There was a time not that long ago when soft money was only used for, basically building a party headquarters, like the bricks and mortar. And now soft money is used for TV ads. I mean, that's just been a matter of six or eight years, how it's evolved.

And as long as there are smart lawyers, there are going to be loopholes found, and that's the frustrating thing about the whole area of campaign reform.

BLITZER: What about some Senate races in 2002 that you are looking at right now, Stu, that could potentially be affected by all of this?

ROTHENBERG: Well, I don't know if he's going to be affected by fund-raising issues, but there are a handful of very interesting races already out there. In the House, there's not much going on, Wolf, because Congressional district lines haven't been finalized. But in New Hampshire, for example, we have -- Senator Bob Smith appears to be drawing a primary challenger with Congressman John Sununu, Jeanne Shaheen, a democratic governor; she was in town over the weekend to attend a dinner. I tried to find out to what extent she was ready to jump into this race; she continues to be very coy, but democratic insiders expect her to run. This is a top-tier race, and Republicans are very nervous about the seat. Remember, one seat gives the Democrats a majority.

BLITZER: Arkansas is a race you're looking at too, isn't it, Charlie?

COOK: Absolutely, Tim Hutchison is a Republican incumbent there; he's been weakened a little bit -- first of all, it's sort of a -- of all the Southern states it is the least Republican, least conservative state in the South. And secondly, he's been hurt by -- he had a bit of a messy divorce, which has weakened him a little bit there. And there are two Democrats looking at running, Congressman Marion Berry and the Attorney General Mark Pryor, he's son of David Pryor, who once had the seat. I'm not sure it's either one or both of them are likely -- will get in. It will be a top-tier race, for sure.

BLITZER: A lot of sons: John Sununu, the son of the former governor of New Hampshire, and David Pryor.

COOK: Let's close the circle; this gets back into campaign finance is that campaigns are so expensive that if you can have the leg up of name recognition because of your mother or father or whatever, that gives you a significant advantage. That's worth umpteen-million dollars right there.

ROTHENBERG: Not all candidates are created equal, even though campaign finance reform treats them so.

BLITZER: If you have a good name, that certainly doesn't hurt.

Louisiana now has two democratic senators.

ROTHENBERG: Yes, Mary Landrieu is up. The Republicans have been talking this race up because she had a close race last time. All I'm going to say before I yield to my Louisiana brethren here, is that I think Mary Landrieu is in pretty good shape. The Republicans may have a primary; right now Congressman John Cooksey is in the race.

But Charlie, why don't I yield to you on this; it's your state. It's your state.

COOK: I always yielded to him on New York last year.

I think it's going to be a pretty good race. Senator Landrieu won by a very, very small margin over Woody Jenkins, a very, very conservative Republican last time. It was shaping up to be a race with Landrieu and John Cooksey, a congressman from north -- Republican from the northeastern part of the state.

But now you've got a new person in: this state elections commissioner who may run, Suzanne Haik Terrell, who is -- she's a moderate, pro-choice woman from New Orleans. She's a state elections commissioner, and her big deal now is trying to abolish her own job, which is kind of interesting. And then there's sort of a maverick Democrat out there who might run, but I doubt it -- James David Cain, a state representative -- or state senator.

But I think it will be a pretty good race, but Landrieu is not in the highest tier of vulnerable seats for Democrats, that's for sure.

BLITZER: North Carolina has a senator; his name is Jesse Helms. What's going to happen there?

ROTHENBERG: Well, there've been a lot of reports that he's already committed to running -- decided to run for, I believe, his sixth term. Wolf, I think we're a little ahead of ourselves here as well. Yes, he has sent out a fund-raising letter. Yes, he has talked to consultants. Yes, he is considering running. But I think he and his wife are going to decide a little later and the Republicans have this conundrum: They're not sure -- they're afraid that if he does not run for election, maybe Jim Hunt, former governor who said he's not going to run -- maybe the open seat will be too enticing and it will be difficult for him to say no. Otherwise the race is wide open, there could be primaries on both sides.

COOK: Well, I have no way of knowing whether Senator Helms has decided whether he's going to run or not. My hunch is, you know, for age and health reasons, that ultimately he won't.

The danger here for Republicans is that if Senator Helms doesn't want to be a lame duck any longer than he has to, he doesn't want to become irrelevant while he's still in the Senate, that he may hold off to the last possible minute to announce he's not running. And that if Democrats unite behind one candidate early on and get a big head start before Helms pulls the plug late, Republicans could find themselves at a real disadvantage. The state -- it still leans Republican, but it's much more competitive than it used to be. And so this is a seat the Republicans ought to be able to hold on to, but there is a scenario -- or a couple scenarios, where they can lose it.

ROTHENBERG: Just remember that the governor is a Democrat, the other senator is a Democrat, the legislature is democratic; yes, this is the South, but this is a different part of the South.

BLITZER: Stuart Rothenberg, Charlie Cook, two of the best -- the best in the business. Thanks for joining us.

ROTHENBERG: Thanks, Wolf.

BLITZER: In Iowa, lawmakers are trying to take campaign reform to a whole new level. The state House voted overwhelmingly yesterday to make it a crime for candidates to lie on the campaign trail or in political material. The measure also cracks down on deceptive "push polls," as they're known, which are designed to help one candidate by slurring his or her rival. Those convicted under the measure could get up to a year in jail or a $1,500 fine. Even supporters concede the law would be difficult to enforce, but they believe it will send a message. The state Senate is expected to approve the measure next month.

Straight ahead: The new administration and its international policies. Why the evolving U.S. approach to Europe is sparking private concerns among European leaders. Plus: the British prime minister grapples with the foot-and-mouth crisis and its potential impact on his political fortunes.

(COMMERCIAL BREAK)

BLITZER: Welcome back. Today's White House visit by German Chancellor Gerhard Schroeder comes as the president is still outlining his international policy, including the official U.S. position on issues important to many European allies. CNN State Department correspondent Andrea Koppel reports a growing list of Bush policies are at odds with European concerns.

(BEGIN VIDEOTAPE)

BUSH: This country must develop a -- what I call a broad foundation.

ANDREA KOPPEL, CNN STATE DEPARTMENT CORRESPONDENT (voice-over): Unapologetic, President George W. Bush defended his administration's decision to reject an international treaty on reducing global warming. To agree to its restrictions, Mr. Bush explained, would not be in the United States' best interests.

BUSH: But I will not accept a plan that'll harm our economy and hurt American workers.

KOPPEL: The president's remarks came on the same day one of the treaty's strongest supporters was at the White House. And while German Chancellor Gerhard Schroeder's body language seemed to signal a tense first meeting, he went out of his way to dispel any such impression.

CHANCELLOR GERHARD SCHROEDER, GERMANY (through translator): I can agree with Mr. President -- we agreed on practically everything, except, obviously for one thing, and that was no surprise to you -- the Kyoto protocol.

KOPPEL: Privately, however, some European governments have expressed concern about a number of issues. Among them: the Bush administration's decision to develop a national missile defense shield, it's unwillingness to engage with North Korea, and its early focus on expanding free trade in the United States' own backyard, rather than working intensely on this year's WTO global trading ground. The message, the allies say, the well-being of the U.S.- European alliance is not a top priority for the Bush administration.

UNIDENTIFIED MALE: We, of course, hope that we will be able to move on to both informing each other very closely before important positions are decided. And then, also, as mature partners facing important common challenges, identify what direction we go from here.

KOPPEL: But if the Bush administration continues to go it alone, analysts warn that strategy could backfire.

UNIDENTIFIED MALE: When it needs an international coalition to solve a problem, whether it's to isolate Iran or strike a better deal with North Korea or get tough with Russia, that its allies won't be there because they haven't been involved in the takeoff.

KOPPEL (on camera): Not so, says the Bush administration. In the words of one senior State Department official: Every European minister that's visited here has, quote, "breathed a sigh of relief," because they heard Secretary of State Powell tell them, "We're going to work with you."

Andrea Koppel, CNN, the State Department.

(END VIDEOTAPE)

BLITZER: British Prime Minister Tony Blair is facing his own problems. Today, he gave himself 48 hours to decide if at least some livestock should be vaccinated to help contain the spread of foot-and- mouth disease. As the slaughter of animals continued in the countryside, Blair held meetings with agricultural officials in London.

Mr. Blair also has to decide in the next week if he will call national elections for May 3. And his political opponents are already pressuring the prime minister to postpone the election to focus on the foot-and-mouth outbreak.

Earlier, CNN London bureau chief Tom Mintier spoke with Mr. Blair and asked him about the political impact of foot-and-mouth disease.

(BEGIN VIDEOTAPE)

TOM MINTIER, CNN LONDON BUREAU CHIEF (voice-over): In the beginning this was a national crisis. Nobody talked about the way the government was handling it. It's turned a bit political in the last 24 hours. Can you keep this as a national crisis, and not allow politics to come into this?

TONY BLAIR, BRITISH PRIME MINISTER: Well, I guess, you know, politics often comes into these things, but in the end, I think most people know that this is a problem that has arisen for, you know, particular reasons that we know that it's important that the government gets on top of it, controls it, eradicates it, and that, really, it shouldn't form part of some great party political debate. It's simply an issue that we have got to deal with.

MINTIER: But has it become a political party issue?

BLAIR: But it shouldn't distract us from the key job which is getting on and making sure we eradicate the disease, and at the same time, sending out to the tourist industry, a strong message to people saying, "For goodness sake, you know, come and do the things you have always done, because there's no reason why you shouldn't."

(END VIDEO TAPE)

BLITZER: If the British election were held now, one poll shows 50 percent of those planning to vote say they would choose Blair's Labor Party, while only 31 percent say they favor the Conservative Party.

INSIDE POLITICS will continue after right after this break.

(COMMERCIAL BREAK)

BLITZER: Let's go now to Willow Bay for a preview of what's ahead at the bottom of the hour on MONEYLINE -- Willow. WILLOW BAY, CNN ANCHOR, MONEYLINE: Hello, Wolf. Just ahead on MONEYLINE: As you know, money and politics take center stage in Washington this evening as the Senate is set to vote on the new campaign finance bill. We'll bring you the latest.

Boeing today unveiling a sleek new jet, traveling just under the speed of sound. The company is also scrapping plans for its super jumbo jet, for now.

And California's rate hike may help utilities fight off bankruptcy, but it has consumers up in arms. And now, state officials wonder if it's enough. We will talk live to Governor Gray Davis.

All that coming up on MONEYLINE. INSIDE POLITICS returns in just a moment.

(COMMERCIAL BREAK)

BLITZER: Please join me tonight on "WOLF BLITZER REPORTS" for an exclusive interview with Jim and Sarah Brady. They speak about -- they speak out in depth about the assassination attempt 20 years ago that left President Reagan and Jim Brady wounded.

(BEGIN VIDEOTAPE)

BLITZER: When you see that picture, the video, that we've all seen so many times over these past 20 years, what goes through your mind?

JIM BRADY, GUNSHOT VICTIM: Please don't show it again. That's how it brings all of it crashing back. And you know, when you consider that you are going to be dead meat, it's not a pleasant thought. When you think of the alternative of having Art Cobrine (ph), Dr. Cobrine, waiting over there, the best neurosurgeon on the planet, who is going to do the deed...

BLITZER: He saved your life.

BRADY: Oh, yes. He saved my life physically and she saved my life emotionally.

(END VIDEOTAPE)

Jim and Sarah Brady tonight on "WOLF BLITZER REPORTS" at 8:00 p.m. Eastern.

And that's all for this edition of INSIDE POLITICS, but of course, you can go on-line all the time at CNN's allpolitics.com, AOL keyword, CNN.

And this programming note: Senator's Dick Durbin and Robert Bennett will be the guests tonight on "CROSSFIRE." That's at 7:30 p.m. Eastern.

I'm Wolf Blitzer in Washington. "MONEYLINE" is next.

TO ORDER A VIDEO OF THIS TRANSCRIPT, PLEASE CALL 800-CNN-NEWS OR USE OUR SECURE ONLINE ORDER FORM LOCATED AT www.fdch.com

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