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Congress Stays Late This Holiday Weekend to Bridge Tax Cut Divide

Aired May 25, 2001 - 17:00   ET

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


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.

With the Senate intrigue behind them and a holiday break ahead, lawmakers work to finalize the tax cut, as the soon-to-be majority leader previews his strategy for the future.

(BEGIN VIDEO CLIP)

SEN. TOM DASCHLE (D-SD), MINORITY LEADER: We obviously are not going to simply be a rubber stamp. We're going to be trying to put a balance to whatever it is we have to take up.

(END VIDEO CLIP)

ANNOUNCER: Behind the scenes of the Jim Jeffords party switch: What caused the rift, who missed the signals, and what happens to the Republican agenda?

Plus: House speaker Dennis Hastert considers the new realities of Washington, and one man's historic decision.

(BEGIN VIDEO CLIP)

REP. DENNIS HASTERT (R-IL), SPEAKER OF THE HOUSE: It's hard searching myself to understand why somebody would do that, but, obviously he's got his reasons, and he has to live with it.

(END VIDEO CLIP)

ANNOUNCER: And after a rough-and-tumble week in Washington, the president mixes it up with the midshipmen, Class of 2001.

Now Judy Woodruff takes you INSIDE POLITICS.

JUDY WOODRUFF, CNN ANCHOR: Great picture there. Well, thanks for joining us.

After days of political upheaval, and as the rest of Washington prepares for the Memorial Day weekend, work continues at the Capitol this hour to bridge the divide over tax cuts. The House and Senate have passed different versions of the president's tax cut bill, and Mr. Bush has said that he wants a final version on his desk before lawmakers head home. But the decision by Republican Senator Jim Jeffords to become an independent is already having an impact, even before the move takes effect.

For the latest from the Capitol, we join CNN Congressional correspondent Jonathan Karl -- Jonathan?

JONATHAN KARL, CNN CORRESPONDENT: Well, Republicans certainly want to do what the president wants and get that tax cut passed. They're even doing the unthinkable here, and that's staying into their Memorial Day recess. Right now the House and Senate negotiators are at work trying to reconcile the differences between that House tax cut, which cuts income taxes for the wealthier more than the Senate tax cut. They're working out the differences right now.

The House is prepared to vote on a final compromise when it is reached, possibly by 10:00 tonight, but they're prepared to go much later, maybe even into the wee hours of the morning. The Senate, however, has adjourned, except for those negotiators. The Senate would come back tomorrow and vote on that compromise if it is in fact reached.

But there is a new development up here, too and that is on the Republican side of the aisle. The Republicans have a new member of their leadership team -- this part of the fallout of the Jeffords situation. The Republicans now have a new position for the moderates in their leadership team. Right now that position will be held, it was announced about 15 minutes ago, by Arlen Specter.

(BEGIN VIDEO CLIP)

SEN. ARLEN SPECTER (R), PENNSYLVANIA: Senator Lott met this morning, Senator Snowe, Senator Collins, Senator Chafee and myself, and we pursued the issues which Senator Jeffords had raised about a greater participation from the moderates -- for the moderates to have a place in leadership. And I have been selected by my colleagues to do that. And I just finished my first leadership meeting, and I found it very worthwhile and I found that I had some things to say which presented a somewhat different point of view. So it feels good.

(END VIDEO CLIP)

KARL: Meanwhile, on the Democratic side of the aisle, Democrats already looking far beyond the tax cut into what happens when Jeffords finally makes his decision official, and Democrats get control of the U.S. Senate. They're looking to their leader, Tom Daschle.

(BEGIN VIDEOTAPE)

KARL (voice-over): As Tom Daschle prepares to take power, the first order of business is to provide what one adviser called "a calming reassurance" that he will work with Republicans and do more than just block the president's agenda.

DASCHLE: We obviously are not going to simply be a rubber stamp. We're going to be trying to put a balance to whatever it is we have to take up. But I do think that we want to show real fairness. KARL: Daschle climbed the Democratic ranks as a soft-spoken consensus builder, acceptable to his party's frequently feuding factions. But more recently, as the leader of an embattled Democratic minority facing a Republican president, Daschle turned up the rhetoric.

DASCHLE: They are the government in power. They now control not only the White House, but the Congress. As narrow as that control may be, for all intents and purposes, they're the majority. And so I think it's important for the American people to realize that they're in control and whatever happens on their watch is really going to be part of the record.

SEN. CRAIG THOMAS (R), WYOMING: Senator Daschle has spent most of his time sort of obstructing what the president wanted to do. Now he's going to find himself doing a more difficult task, and that's to move something forward. It's much easier to be a problem in moving it than it is to move it.

KARL: There's a practical reason for Daschle to change his tone. Not only will his be one of the narrowest Senate majorities in history, but he also must deal with a Republican House and a Republican president, making it impossible for him to get anything done without at least some Republican support.

RON KLAIN, FORMER DASCHLE AIDE: He will strike the right balance between compromising when that's the right thing to do, and standing up to President Bush when that needs to be done as well.

KARL: Daschle may also face some problems within the ranks, especially when it comes to doling out committee chairmanships.

SEN. HARRY REID (D-NV), MINORITY WHIP: If some Democratic senators decide to take chairmanships, committees, they are not now the ranking member. That could create some difficult problems.

KARL: Already, Senator Joe Biden is saying he may want to be judiciary chairman, pushing aside Patrick Leahy and causing a ripple effect, where Leahy would be agriculture chair and Tom Harkin, currently in line for that job, would be out of luck.

(END VIDEOTAPE)

KARL: As the majority leader, Tom Daschle and his Democratic committee chairmen would certainly have more power to thwart the president's agenda. But Daschle's advisers acknowledge that he will also face pressure from his moderates, from Democratic moderates and Democratic conservatives who want to work with the president -- Judy?

WOODRUFF: There's no end to the fun up there.

Jonathan, first of all, about Senator Specter, what exactly will his role be in the leadership?

KARL: Well, this is an appointed leadership position. It is not an elected leadership position like the other positions in the Republican leadership, so it certainly comes with less clout because he was not elected by the full Republican caucus. And it's unclear exactly what responsibilities Specter will have, except that he will have a seat at the table. In other words, when the leadership gets together to have their meetings to talk about the direction of the Republican agenda, Specter will be there and he will have a voice in those meetings. Beyond that, it's unclear how much clout he'll really have.

WOODRUFF: And Jonathan, separately, we know that Senator Jeffords issued a statement today, one day after announcing he's leaving the party? What was that about?

KARL: Well, Senator Jeffords has been upset about some of the reporting, some of the talk that he did this for political reasons -- that he became an independent because he secretly plans to run for governor of Vermont and he wouldn't have much luck running as a Republican, much more luck running as an independent. He is saying this is not the case. He released a written statement.

The statement reads in part: "My decision was to leave the Republican Party. It was not based on aspirations for something else. While some might find it convenient to describe my decision in terms they can understand, such tactics should be seen for what they are. I hope the spinning will stop so that we can all move on."

Now, a lot of this has been coming right from the White House. White House advisers saying that they believe that Jeffords had ulterior motives, that he really did this not so much out of principle, but out of political calculation. As you can see, Jeffords saying that is absolutely not the case -- Judy.

WOODRUFF: All right. Jonathan Karl at the Capitol.

Well, you can see all of that interview with Senator Tom Daschle tomorrow on "EVANS, NOVAK, HUNT & SHIELDS." That's at 5:30 p.m. Eastern. Republicans are still feeling the aftershocks of the Jeffords party switch, and they are still exploring reasons why he decided to leave their party.

Our John King joins us now with a behind-the-scenes look at the moves leading up to the decision at the Capitol and inside the White House -- John.

JOHN KING, CNN CORRESPONDENT: Well, Judy, White House officials disputing the notion that they were caught flat-footed. Certainly they say if they were caught flat-footed by this, then the entire Republican Party, especially those in Washington were; noting that Olympia Snowe, the senator from Maine, one of Senator Jeffords' close friends, said she was caught off-guard by this.

In conversations with members of the Senate and people here at the White House, they say yes, they were aware that late last week there were some rumors, some talk in the Capitol that Senator Jeffords might be thinking of switching. They likened that, at that point, though, to all the buzz there's been about Georgia Senator Zell Miller perhaps leaving the Democrats for the Republicans. They didn't think it was very credible at the time.

White House officials saying they began to take it seriously on Monday night. That was when Senator Snowe called the White House chief of staff. She called Andy Card Monday night and said she had talked to Senator Jeffords and that there was a problem. Now, Card and Snowe then talked on Tuesday morning, and the White House says at that point they kicked into gear. There were meetings that afternoon, Jeffords and Vice President Dick Cheney up at the Capitol. Then Jeffords summoned down here to the White House for a one-on-one meeting with President Bush.

Administration sources say at that point, Jeffords told both the vice president and the president that his mind was all but made up. And they also say, despite what Senator Jeffords has said publicly, that in those private meetings he voiced much more displeasure about how he was being treated by fellow Republicans in the Senate, not so much direct displeasure with the president's conduct or the administration's agenda.

However, administration sources do confirm something Senator Jeffords has said publicly -- that he looked the president in the eye at that meeting and told him that he thought he would be a one-term president unless he did more to reach out and work with Democrats and the Republican moderates. Now, the focus here obviously, now, is looking forward. A very tough fight in a Democratic Senate for the president's agenda, especially, they think here at the White House, his judicial nominees.

Speaking out on this today, the Vice President Dick Cheney, asked a question during a speech in town. He said it was -- quote -- "obviously painful to have a member of the Republican Party quit the party." But, the vice president says, it's still an open question as to whether there will be as much actual change in the legislative agenda, now that we have had this dramatic shift in power.

WOODRUFF: Oh, I am sorry, John, I thought that you were -- I thought that we were going to hear a sound bite there.

KING: So did I.

WOODRUFF: Let me go back to what you said about the report that Jeffords looked at the president and said: "Unless you reach out more to moderates and -- moderates in your own party and Democrats, you are going to be a one-term president." Everything we have been hearing from the White House is their contention that that's exactly what they had been doing.

KING: Well, they say they have been, and they say they have reached out on any number of occasions, and they're especially miffed here, they are trying to calm down now . They don't want to have a fight about this now, but they're especially miffed at Senator Jeffords' remarks about education. He obviously wants to spend more than the president does on education.

The White House is saying it's part of the budget and tax discussions. They've had numerous meetings with him on this, that they've gone very far trying to reach his demands. They acknowledged they haven't gone as far as he wanted to, but in the words from one official here, quote: "This guy is to the left of Teddy Kennedy on education. He can't ever have imagined we would go that far."

Now, Judy, I think we do have the vice president's perspective. He says while there's been obviously a dramatic change in party control in the Senate, he is not quite so sure there will be an equally dramatic change in the results, once legislation actually gets debated in the new Democratic Senate.

(BEGIN VIDEO CLIP)

RICHARD CHENEY, VICE PRESIDENT OF THE UNITED STATES: The basic makeup of the Senate doesn't change. The votes are the same. The same 100 senators that were there tomorrow that were there yesterday, and we think the issues are -- have not changed any.

And that it's still just -- if there was justification for the Republican Senate addressing these issues last week, there is a justification for a Democratically-controlled Senate adjusting them going forward.

(END VIDEO CLIP)

KING: Now, a look in the very near future for another overture for the new soon-to-be majority leader Tom Daschle. The president and Senator Daschle spoke yesterday. There's a lot of talk about inviting Senator Daschle down here, but the White House wants first to respect the Republicans who are still the Senate majority. They want that tax debate concluded first, as soon as possible.

And once Mr. Daschle actually is the majority leader, look a very quick invitation for a little private time with the president -- Judy.

WOODRUFF: All right. John King from the White House press briefing room. Thanks.

For an early read on public reaction to the shift in Senate control and how that shift came about, let's turn now to CNN senior political analyst Bill Schneider.

Bill, how is the American public reacting to Jeffords' decision to leave the party, the Republican Party?

WILLIAM SCHNEIDER, CNN SENIOR POLITICAL ANALYST: Well, I would say Jeffords is getting a mixed reaction. And that's because Americans are responding to two conflicting impulses. Impulse No. 1: Would the country be better off if the Republicans or the Democrats controlled the U.S. Senate? And the answer? Democrats, 45 to 36 percent. So, what Jeffords did looks like a good thing. He brought the Democrats to power.

Impulse No. 2: Is it acceptable or unacceptable for a senator to run as the candidate of one party and then leave that party after he or she gets elected? And the answer? Unacceptable, 61 to 33 percent, nearly two to one. So, what Jeffords did looks like a bad thing. He betrayed the voters. In fact, a majority of Democrats say a senator should not switch parties after he or she gets elected.

WOODRUFF: But what do you get if you put both impulses together? What do you get?

SCHNEIDER: Well, all things considered, people think it was a bad idea, even if they like the outcome.

Here's what happened when we asked people what they thought of Jeffords' decision to become an independent: 51 to 41 percent disapproved. It wasn't a popular move because he did it without consulting the voters. Maybe that's why he went back home to make the announcement.

WOODRUFF: And do people think he should consult the voters now?

SCHNEIDER: Actually, no, they don't. Most people say Jeffords should finish his term as an independent, rather than resign immediately and run for re-election as an independent. That's what some Republicans are suggesting he do.

People don't approve of his decision, but they do feel he was legally elected. And by the way, the public is inclined to agree with Jeffords' complaint that the Republican Party under President Bush has become too conservative, 50 to 42 percent agree with that.

The Republicans thought they had a mandate to govern from the right. They got carried away by our old friend, irrational exuberance.

WOODRUFF: So, what we have, divided government, does the public see that as better?

SCHNEIDER: Well, you know, not really. And do people expect more cooperation or more gridlock as a result of Jeffords' decision? The answer is more gridlock, 50 to 15, with 30 percent saying, well, it won't make any difference. Talk about conflicting impulses! People like having a Democratic Senate, but they think it will lead to more gridlock in Washington. That's what I call experience triumphing over hope.

WOODRUFF: I have never heard that before. It's a good one to bring out now. Bill Schneider, thanks very much.

SCHNEIDER: OK.

WOODRUFF: Well, this holiday weekend will give White House strategists a chance to consider life with a Senate controlled by Democrats. Joining us now to talk about the new challenges to president's agenda is Ken Duberstein. He was former President Reagan's chief of staff, in a time when the House and Senate were both controlled by the Democrats.

Ken Duberstein, first to what Jim Jeffords did. Did the president -- the people around the president, the Republican Party in the Senate, walk away from Jim Jeffords or did he walk away from them? What happened? KEN DUBERSTEIN, FORMER WHITE HOUSE CHIEF OF STAFF: Well, I think Jim Jeffords walked away from the president and from the White House.

You know, in any White House, you have a creative tension between the true believers and those who want to govern. But I think George W. Bush really leaps both sides of it and brings people together. I think he, in fact, tried to deal with the Congress, House and Senate, Republican and Democrat, by reaching out.

The answer, though, has to be, he can't take anybody for granted. And in a 50/50 Senate, or now 51-49 Democratic, he has to redouble his efforts to make sure not to leave any senator behind.

WOODRUFF: But it's not just Jim Jeffords. We were told that in the Republican caucus in the Senate it was Olympia Snowe, it was Pete Domenici and others who stood up and said: "We've got to reach out more to people like us."

DUBERSTEIN: And the answer is that George W. Bush I think has tried to do it, and now will redouble his efforts. You know...

WOODRUFF: But if he was trying, why wasn't it happening, is my question?

DUBERSTEIN: Because he was listening, but they were not acting on everything. And I think what you are going to see right now is much more of a partnership with the Republicans and with some like- minded Democrats.

But I also remind you that if in fact George W. Bush has to recalibrate a little bit on his play book, Tom Daschle has to recalibrate even more. He has to decide whether he is going to go with Ted Kennedy and Hillary Clinton, or is he going to try to accommodate Zell Miller and Max Baucus and others?

The story you were covering two weeks ago was how Tom Daschle was beating on Max Baucus, as far as the tax bill. Well, now, he has to create in his own caucus the kind of responsibility so we can work with George W. Bush. The onus very much is now on Tom Daschle as well.

WOODRUFF: And I know that you are a Republican, but do you think he as a Democrat is going to be successful doing that?

DUBERSTEIN: I think that Tom Daschle has to figure out ways to work with the White House every bit as much as George W. Bush has to work with the Senate.

WOODRUFF: What exactly -- let's talk about the president -- what exactly does he need to do differently? We were told, for example, one of the first things he did after this happened, he found out about Jeffords, was to call John McCain?

DUBERSTEIN: I think what he has to do is stay fundamentally with his play book, but has to tweak it a little bit. He was right on tax relief, he was right on education... WOODRUFF: The 1.6 trillion?

DUBERSTEIN: ... and I think he is going to get great victories on the tax bill and education. He has to continue to reach out. I think that's what he has to do and find where he can build a coalition that has at least 51 votes. He can bring some Democrats over.

You know, it's interesting, Jim Jeffords, for example, is one of the prime sponsors of George Bush's patients' bill of rights. What kind of an irony is that now that he has switched?

WOODRUFF: Well, let me ask you this: is it -- is it that the Bush agenda has to be tweaked, or is it -- you called it the play book. I mean, are we talking about an approach in tactics, or are we talking about policy here in this change?

DUBERSTEIN: I think the policy, by and large, is right on target, and I think they need to adjust by opening the doors even wider to all senators, taking nobody for granted. The Republicans, but also don't take the no-votes for granted. It's always about the give and take of shifting coalitions. He has to reach out.

WOODRUFF: So, you are saying Jim Jeffords was the only one in the Senate among Republicans who had a problem with the Bush agenda?

DUBERSTEIN: No, I am saying that several people want more care and feeding, and that's what George W. Bush and the White House staff have to be doing. It is constantly taking care of 100 independent contractors and working them day in and day out.

They have tried to do it. I think it's been a breath of fresh air since Bill Clinton, but they have to redouble their efforts, especially with the narrowly-divided Senate that there is.

WOODRUFF: All right, you mentioned energy, you mentioned patients' bill of rights, what of the Bush agenda do you think has a pretty decent chance of still getting through now? What looks problematic to you?

DUBERSTEIN: Well, I think patients' bill of rights is going to wind up to be more Bush than less Bush. I think prescription drugs is also going to be very much in play on the Bush side. I think energy policy, by and large, what needs legislation, is going to have better than a 50/50 chance.

So what you are going to see, looking back at the end of the year, is the fact that George W. Bush made probably dean's list: tax relief, education, energy. I think it's a pretty strong first year. And why recalibrate yet? Yeah, you have to rejigger a little bit, but that's more in outreach. It's inviting Tom Daschle down to the White House, as John King suggested. Those are the kinds of things that you have to be doing rather than saying, hey, this playbook is not working, I'm not getting any victories. He in fact is getting an awful lot of victories.

WOODRUFF: All right, Ken Duberstein, great to see you again. DUBERSTEIN: Likewise, Judy.

WOODRUFF: Thanks very much. We appreciate it.

Well, how do things look from the other side of the Capitol?

(BEGIN VIDEO CLIP)

REP. DENNIS HASTERT (R-IL), SPEAKER OF THE HOUSE: They call me the speaker, but they also ought to call me the listener.

(END VIDEO CLIP)

WOODRUFF: Ahead, Speaker Dennis Hastert talks about the challenges facing the House. And orchestrating a political masterpiece, Bill Schneider on the man who conducted "The Play of the Week." And next, searching for victims in the aftermath of a wedding catastrophe. The latest from Israel -- still ahead on this edition of INSIDE POLITICS.

(COMMERCIAL BREAK)

WOODRUFF: We'll have more of this day's political news coming up, but now a look at some other top stories. After yesterday's disaster at a wedding reception in Jerusalem, Israeli authorities arrested eight people today, including the owners of the building where a floor collapsed. At least 25 people were killed after plunging from the building's fourth story, 250 were injured.

CNN's Ben Wedeman is in Jerusalem, and his report includes pictures that some will find disturbing.

(BEGIN VIDEOTAPE)

BEN WEDEMAN, CNN CORRESPONDENT (voice-over): It was a moment of joy for newlyweds Keren and Assi Sror, whose families came together to celebrate a marriage. Captured on amateur video, that moment of joy was transformed in an instant into a nightmare.

(SCREAMING)

The floor of the packed hall gave way under the weight of hundreds of revelers. In the aftermath, rescue workers dug frantically for survivors as more bodies emerged from the rubble.

These rescue workers are veterans of bombings and disasters, both at home and abroad. They pitched in to find survivors of the devastating earthquakes in Turkey, Greece and India, and in Nairobi, Kenya following the bombing of the United States embassy in 1998.

Their frantic work here is made worse by the danger of falling debris.

SGT. OVADIA OVADIA, ARMY RESCUE UNIT: I think the feeling between -- among the people who were working there was one of urgency and people working at a frantic rate, you know, with always in the background the hope that somebody is still alive and a life could be rescued.

WEDEMAN: Israel's chief rabbi has ruled that those involved in the recovery effort will be exempted from observing the Jewish sabbath's ban on work.

(on camera): Officials point to substandard construction and overcrowding as two possible causes for the catastrophe.

(voice-over): Just hours after the disaster, the first funerals, sorrow on a day that should have been one of celebration.

Ben Wedeman, CNN, Jerusalem.

(END VIDEOTAPE)

WOODRUFF: U.S. Secretary of State Colin Powell continued his trip through Africa today, addressing students at a university in South Africa. Powell outlined U.S. policy for Africa during his speech. He says the U.S. is dedicated to helping lift the continent's economy through debt relief and the ending of conflicts. And Powell reiterated the United States' commitment to helping end the spread of AIDS in Africa.

A blind man has done what most sighted people could or would never do. Erik Weihenmayer has become the first blind person to scale Mt. Everest. Weihenmayer followed the sounds of bells tied to the jackets of other climbers in his party to help reach the summit.

A losing day to wrap up this week on Wall Street. A report that the national economy grew at a slower pace for the first quarter than previously expected is blamed for dragging stock prices lower. At the closing bell, the Dow lost 117 points. The Nasdaq ended the day down 30 points.

There is more on the markets and what factors are influencing prices on "LOU DOBBS MONEYLINE." That's at 6:30 Eastern.

We'll be back with more INSIDE POLITICS in just a moment.

(COMMERCIAL BREAK)

WOODRUFF: With Democrats getting ready to take control of the Senate, House Speaker Dennis Hastert becomes the highest ranking Republican in Congress.

CNN congressional correspondent Kate Snow reports that Hastert is making some changes to deal with the new reality.

(BEGIN VIDEOTAPE)

KATE SNOW, CNN CONGRESSIONAL CORRESPONDENT (voice-over): These are changing times on Capitol Hill: Senator Jeffords' earthquake in the Senate sent tremors through the House.

REP. DENNIS HASTERT (R-IL), HOUSE SPEAKER: It really changes the dynamic of how we move the president's agenda, how we sit down and talk about these issues.

SNOW: Speaker Hastert didn't know President Bush very well before January, but he works closely with him now.

BUSH: Mr. Speaker?

HASTERT: Hey, Mr. President, how are you doing?

SNOW: And with the Senate changing hands, the Republican-led House is even more relevant.

SNOW (on camera): How often do you speak with President Bush?

HASTERT: I probably speak to him every other day, every three days. We probably meet at least once a week. So we have a pretty close relationship.

SNOW (voice-over): One issue Hastert wants to push for the president: his energy proposals.

HASTERT: I feel that we need to do it step-by-step so we can talk about policy. When you get everything balled up, as we do so many times here in the Congress, it gets so big people can't pick it apart and understand what the policy is. And there's a lot of different policy things that you have to do in energy.

SNOW (on camera): Well, pick out California for a second, then. You just mentioned, the Democrats have really been on the attack on that one. They have said that the president's plan offers nothing in the short term, that they need price controls in California, and that they're offering an amendment to do that. Have you done enough for the short-term?

HASTERT: Well, understand what the Democrats are trying to do, they're trying to shift blame. They've been in control for the last eight years. They got us into this situation.

SNOW (voice-over): Hastert talks a lot about the need for bipartisanship, though Democrats charge he hasn't practiced what he preaches.

HASTERT: That's a little bit facetious, because we've done a lot of things in a bipartisan way. Almost every tax bill that we've passed this year out of the House has been a bipartisan tax bill. Representative Gephardt has opposed it, but we've passed it in a bipartisan way. And even the education stuff -- a huge bipartisan effort.

SNOW: But the education bill the House passed this week doesn't include vouchers.

(on camera): Was education a success in that sense, or did you have to leave some things out that you would have rather seen in there?

HASTERT: Well, yes, that's part of the little "D," democracy. You know, we had to let the will work its House -- work its will. And, you know, we did have amendments on that. Everybody had a chance to vote on the vouchers and on the flexibility for states and local governments. And quite frankly, those -- I voted for them, but they lost.

SNOW (voice-over): The loss on vouchers doesn't sit well with conservatives. Neither does the testing provision included in the education bill, but Hastert offered them votes on both issues to keep conservatives in the loop.

While Senate Majority Leader Trent Lott has to appease moderates, Hastert focuses on the conservative wing.

HASTERT: You know, they call me the speaker, but they also -- a lot call me the listener because what we try to do is take the concerns of our members, and listen to what they have. And, you know, there are a lot of people that weren't happy with that bill, but there were a lot of people that wanted it to pass. And we needed to try to balance this out, we needed to listen to the problems of conservatives.

SNOW: The speaker says he doesn't worry much about the political future.

(on camera): I was speaking with Leader Gephardt the other day, and he said that one of his big focuses is 2002, making sure they get the House back. In fact, he said that that's more important in some ways than legislation, is getting the House back.

HASTERT: When I became speaker, I thought we needed to get beyond politics and get things done. The American people expected this Congress to do things. Mr. Gephardt was focused on the 2000 election, and he probably tried to stop everything that we tried to move because he thought he could make political hay out of it. I just don't view it that way. And if he thinks the 2002 election is more important than getting things done for the American people, I disagree with him.

SNOW (voice-over): Hastert says he never wanted to be speaker, and he doesn't know how long he'll keep the job.

HASTERT: An old coaching philosophy I had is that you ought to leave when you're on the top of your game, and...

SNOW (on camera): Well, you're pretty well at the top right now.

HASTERT: Well, you never know.

SNOW (voice-over): This week in the Senate has proven that.

Kate Snow, CNN, Capitol Hill

(END VIDEOTAPE)

WOODRUFF: Florida Republican Congressman Joe Scarborough announced today that he will resign his seat effective in September. The 38-year-old Scarborough choked back tears as he made the announcement, saying he wants to spend more time with his family. Some observers believe that a chronic back problem and frustration with Washington politics also contributed to his decision. Scarborough's departure will not affect party control in the House. Republicans now hold an 11-seat majority, and it is expected that another Republican will take over the Scarborough seat.

The mayor of York, Pennsylvania, is giving up his reelection bid because of questions surrounding his past. York's two-term mayor Charlie Robertson was charged with murder last week based on an incident that occurred 32 years ago when he was a police officer. Prosecutors say Robertson provided ammunition to a white gang member who shot and killed an African-American woman during the city's race riots. Robertson denies the charge. But after initially vowing to continue his campaign, he now says that he will drop his candidacy, in his words, "to save the city."

Going behind the scenes, our Bill Schneider reveals the central figure in the "Political Play of the Week."

(COMMERCIAL BREAK)

WOODRUFF: Senator Jim Jeffords' decision overshadowed nearly all other news on the Hill this week, from the tax cut to the education bill. The move gives Democrats a new political strength, and turns the tables here in Washington.

And our Bill Schneider joins us now to explain it all -- Bill.

SCHNEIDER: Judy.

Cui bono? No, that is not a recently departed pop singer, that's Latin for, "who benefits"? Who comes out the biggest winner in all of this? And when you've answered that question, you've figured out the "Political Play of the Week."

(BEGIN VIDEOTAPE)

SCHNEIDER (voice-over): The Bush revolution lasted exactly 123 days: From January 20 to May 24, the Republicans controlled the White House and both Houses of Congress, and tried to govern from the right, with one big achievement: the tax cut which, ironically, passed the Senate the same day GOP Senator Jim Jeffords terminated the conservative ascendancy.

Why did Jeffords do it? We now know that Senate Democratic Leader Tom Daschle and his allies had been quietly waging a campaign for weeks to persuade Jeffords to leave the GOP as soon as it became clear that Jeffords was unhappy with the Bush agenda and with his treatment by the White House and by Senate Republican leaders.

Daschle initially approached Jeffords during the budget debate a month ago. Jeffords subsequently met with Democratic Senators Christopher Dodd and Bill Nelson. Democratic Whip Harry Reid offered to step aside and allow Jeffords to chair the Environment and Public Works Committee if the Democrats took over the Senate. Republicans think the whole thing smells funny.

(BEGIN VIDEO CLIP, "LARRY KING LIVE")

KARL ROVE, SENIOR WHITE HOUSE ADVISER: You have to respect somebody who does something out of principle. If there's something else that turns out to have been a part of the motivation here, I think people will be disappointed, but...

LARRY KING, HOST, "LARRY KING LIVE": Do you suspect that?

ROVE: Well, I don't know. There's a lot of conversation around this town, and we'll see -- about committee chairs and deals and bargains and pledges. We'll see.

(END VIDEO CLIP)

SCHNEIDER: Conservatives are calling Jeffords a sellout, a traitor, "Benedict Jeffords." But Democrats on the inside claim there was no quid pro quo.

SEN. CHRISTOPHER DODD (D-CT), RULES RANKING MEMBER: This is a highly-principled individual, and I'm somewhat familiar with the events over the last week or so, and I can tell you flat out that Jim Jeffords asked for nothing and was offered nothing.

SCHNEIDER: The Democrats' dealings with Jeffords were highly secret. Republicans appear to have been caught totally unawares. It wasn't until Monday night, when Jeffords confided his intentions to a Republican colleague, that GOP leaders figured out this was serious, and scrambled to try to convince Jeffords to change his mind.

But Jonathan Karl first reported the story last Friday on INSIDE POLITICS.

(BEGIN VIDEO CLIP, "INSIDE POLITICS")

KARL: Now, all along, Jeffords has been downplaying this speculation, but there has been a change. He is now openly flirting with the idea of possibly switching parties.

(END VIDEO CLIP)

SCHNEIDER: After that report, CNN's Senate booth was flooded with calls from Senate Republicans asking: "Is it true?"

While Republicans slept, Daschle had waged a masterful campaign to get Jeffords to switch, and kept it quiet. Tom Daschle now becomes the voice of a party that has felt voiceless and leaderless for six months, the Democrat who stopped the rule of the right.

TOM DASCHLE (D-SD), MINORITY LEADER: Well, we have always had an obligation to do what we think is right. That's what we've done in the past, and we're going to continue to do so. Now I think we have more tools at our disposal to ensure that that happens. SCHNEIDER: Like the Senate majority. Cui bono? Who benefits? New Senate Majority Leader Tom Daschle, king of the Democrats and winner of the "Political Play of the Week."

(END VIDEOTAPE)

SCHNEIDER: Two Senate majority leaders have run for president in the last 50 years. One Republican, that was Bob Dole in 1996. He won the nomination. And one Democrat, Lyndon Johnson in 1960. He got on the ticket. Interesting?

WOODRUFF: I wonder if Tom Daschle has paid any attention to that history.

SCHNEIDER: Well, possibly.

WOODRUFF: Bill Schneider, thanks.

Power, politics and party switching. We will talk more about the Jeffords effect next with our INSIDE POLITICS roundtable.

(COMMERCIAL BREAK)

WOODRUFF: Now to our Friday roundtable. Our guests this week, Bob Novak of "The Chicago Sun-Times," CNN Washington bureau chief Frank Sesno and our senior political correspondent Candy Crowley.

Candy, to you first. Jim Jeffords said today this was principle, that is why I left the Republican Party. The White House is saying it was politics. Which is it?

CANDY CROWLEY, CNN SENIOR POLITICAL CORRESPONDENT: Oh, you know, I don't think they have to be mutually exclusive. Look, there was no net loss for Jim Jeffords in doing this. It probably makes him more popular in his home state. He wasn't getting anywhere as a Republican. So it is not as though there was some big sacrifice for this principle.

That doesn't mean he didn't have principles and didn't want to go fight for them, but there was, you know, there was a good political reason for Jim Jeffords not to be in the Republican Party anymore.

WOODRUFF: Was it more of one than the other, Bob Novak?

ROBERT NOVAK, "CHICAGO SUN-TIMES": There is no principle involved at all, in my opinion. I mean, if it was principle, he could have done this any number of years ago. He has been out of step with the Republican Party for a very long time, the idea that because there is Republican president makes it different -- Republican President Reagan didn't make it difficult for him.

But what the difference was right now is that there is a 50-50 Senate. So he had leverage, he had bargaining power to make a move. And contrary to what Senator Jeffords says, and I think some of the people who know him well, he liked this 15 minutes in the sun, to be on -- his picture all over the world. He was the huge story in every paper in America.

WOODRUFF: So, Frank, that is all it was?

FRANK SESNO, CNN WASHINGTON BUREAU CHIEF: Well, the best principle, it is said, is when it's, you know, supported by good politics, and that's really what this was. Look, I have known Jim Jeffords, I started out in Vermont radio, interviewed him for the first time back in 1977 when I was 4.

(LAUGHTER)

I think he wasn't much older.

But, you know, he has always been kind of idiosyncratic guy, to put it nicely. This is a guy who slept on his couch in his office. Vermonters are, shall we say, idiosyncratic, very independent, proud of it, and they love principle, especially when it mixes well with politics.

WOODRUFF: And you are saying that is what's happening?

SESNO: Clearly, that is what happened here. What -- the main irritant, Candy -- Bob you know this too, right -- for this guy was the way the tax bill and the budget went forward with his beloved aid to special education for him, and that was a burning crusade for him, among other things.

NOVAK: That's true. That was his cause, his belly, but the problem with that argument, Frank, is that he was -- I know this for a fact -- he was talking to Democrats last year, when Bill Clinton was in the White House. And certainly, then...

WOODRUFF: About leaving the Republican Party?

NOVAK: Yes. And he has been negotiating with Harry Reid for literary for months, and he was not going to leave the party unless he had a chairmanship. He was a chairman in the Republican Party, which -- chairmanship that Trent Lott saved for him, by the way -- and he wasn't going to leave there to be a back bencher, so that doesn't seem like principle.

SESNO: But that's how he married principle and politics. He got a chairmanship. He was an endangered species as a Republican. He was an endangered species as a chairman.

NOVAK: Why was he endangered species? I don't understand this endangered species. As a Republican, of course, you know, they weren't going to kick him out of that chairmanship.

CROWLEY: But there was no -- I mean, you know, there was no power for him within the Republican Party. He is going to have -- I mean, he was about to leave that chairmanship because of term limits. He, you know, is going over to a committee that he cares about. You know, the environment, and in Vermont -- and that fits very well.

I mean, I don't think that it has to not be principle if it is political, that is all I'm saying. I think it fits in with his principles, the principle of his politics, if you will.

NOVAK: The only principle, the only principle I would is that -- at somebody is totally out of sync with the mainstream of the party, as I think Jim Jeffords, as I think Phil Gramm was with the Democratic Party and Dick Shelby was with the Democratic Party, they ought to leave. I don't know if that is a matter of principle, but there is no question that -- that Shelby (sic) is not just one of the most liberal Republicans in the city, he's one of the most liberal senators, period.

WOODRUFF: Candy, I have a question. If Jim Jeffords has been thinking about this, talking about this for a long time, if it has been in the works, how come the White House didn't pick up on it sooner?

CROWLEY: You know, you've got me. And I'll tell you, I -- I don't get it. I mean, it was all over. It was on the front page of the Vermont paper. I mean, someone not sort of -- I mean, you'd think you would be sort of tuned into the McCains and the Jeffords and the Snowes and, you know, whoever else is out there. I don't get it. I think they thought it was more of the same. In fact, I know they thought it was all, oh this has been out there for a long time. They sort of dismissed it at first.

SESNO: I was talking to a source, someone up in Vermont just a few minutes ago, and they were shocked. They said, you know, something as late as very late last week and over the weekend and this week, the White House, they said, senior members of the White House, were calling top Republicans in the state of Vermont, saying: "Is he really going to do this? Is this possible? Could this be happening?"

And this person was saying, you know, they are on the phones, talking to people up in Vermont when Vermont Republicans are hardly going to stand in Jim Jeffords' way, they're saying, where was their antenna, where was their radar?

CROWLEY: In Washington, in Washington.

NOVAK: And where was the antenna of his Republican friends here? Olympia Snowe, who lunches with him every week, she didn't know about it? One of his great friends and supporters, Chuck Hagel of Nebraska, he didn't know about it. And I think he was duplicitous in the fact that he was negotiating with Democrats and he didn't tell his Republican friends -- I'm not talking about the right wingers -- anything about what's going on.

WOODRUFF: Let's talk about where we go -- you want to say something?

CROWLEY: I just want to say regardless of, you know, whether or not they knew it was imminent, they had to have known that this was guy they needed to kind of watch and maybe, be semi-nice to. I think the teacher thing, regardless of how that happened is just ridiculous. I mean why would you, you know, why you would you do something like that?

(CROSSTALK)

WOODRUFF: And he felt he wasn't sufficiently part of the education bill negotiations.

NOVAK: He claims and he told the president that that was not the cause. He is -- the guy he is more angry about, is Judd Gregg, his fellow New Englander, conservative New Englander from New Hampshire, who cut some of his money out of the budget for him.

WOODRUFF: Two minutes left, let's talk about where we go from here. Tom Daschle is now -- will be, shortly -- the new leader of the Senate. What is going to be different? What is it that President Bush wants to get through that is not getting through? What is it the Democrats are going to try to do?

CROWLEY: I was just going to say, here is what I think the main difference is, they've got a platform, OK. And once you get past -- yes, committee chairmanships are interesting, but it's still the same votes but look, last week, Tom Daschle was complaining that he wasn't -- that the Democrats couldn't get their word out, that you know, he understood you know, that the White House, but the Democrats, no one was turning the camera on them, their news wasn't bubbling up to the top.

And you know, guess what? Now they've got a platform, and they are already putting together an agenda. They have a platform, and that is where it makes the biggest difference.

NOVAK: And the question is what does the president do now? If you listen to the television commentators, the talking heads, all of us, it sounds like what he should do is suddenly compromise, retreat, water down his agenda. I think that would be the worst thing he could's possibly do.

But what you can do, you know, Bill Clinton did a very good job in thwarting the Republican majority in Congress for six years, and so it's a question whether George W. Bush is going to play hardball or softball, and I don't think the jury is spoken to that one yet.

SESNO: I talked to a senator a while ago, he didn't want his name used, but he's in line to be one of these new chairman of these powerful committees. He said OK, look, on energy, it is not going to be let's drill. On national missile defense, it's going to be a debate, he says, not driven by the defense missile industry, but driven by defense experts, his take. On the patient's bill of rights, it's going to be more about patients, and rights, and less about the industry.

There is going to be a lot more consulting, there better be, he says, with the White House. He says, this take, if the president wants to say to the right wing, Bob, you may want to respond to this, look, I tried, but now look what's happened. I'm going to move to the middle, this is the way he can do it.

NOVAK: Well, I think that would be an absolute disaster for him, and I would think right now, that on all of these issues, there is a question of whether the president is going to retreat or not. I think if he retreats, on everyone of those issues, Frank, as you said, your Democratic senator, he's finished as a president. He goes back in the book with his father as failure.

WOODRUFF: All right. We are going to have to leave there. We may want to talk about this some more another time.

SESNO: Maybe.

WOODRUFF: Bob Novak, Candy Crowley, Frank Sesno, thank you all three. Great to see you. Happy weekend -- Memorial Day weekend.

Well, Vermont may be a little mall and off the beaten path, but residents say it has an appeal all its own. Up next: The state that often takes the road less traveled, as Frank said, and why the people there like it that way.

(COMMERCIAL BREAK)

WOODRUFF: Vermont's role this week as the center of attention was unusual for a state better known for its relaxed lifestyle and natural beauty. But Vermont also is carving out a reputation for political independence without regard to party labels. CNN's Bill Delaney has the story.

(BEGIN VIDEOTAPE)

BILL DELANEY, CNN CORRESPONDENT (voice-over): Slumbering in a kind of primordial haze, Lake Champlain, among the venerable visions of Vermont, state of 600,000, state of mind, and briefly...

UNIDENTIFIED MALE: Come one, come all!

DELANEY: Pretty much out of its mind. As Senator Jim Jeffords, at a hotel on Lake Champlain, not just marched to, but beat the heck out of his different drummer. Independent, as Vermonters already are.

(on camera): Jeffords' independent, or ornery streak, depending on your point of view, is very Vermont, where real doubts about modernity -- each shopping mall cause for real anguish here -- clashes with perfectly modernist approaches to things. The only state gays can form legal, civil unions is right here.

(voice-over): Rock-ribbed, Republican, postcard Vermont now coexists with places like Church Street Marketplace, in Burlington right up from the lake. Johnny C., like so many Vermonters, just plain likes rocking the boat.

UNIDENTIFIED MALE: We are the only state that won't pass an anti flag-burning amendment, 49 other states have, oh yeah, we are, we are independent.

DELANEY: Not that "independent," here isn't often a king of code for liberal, drawing tens of thousands for a generation or so now from often left-leaning places, escapees from urban workaholicism, suburban sprawl. Voters who helped elect Bernie Sanders, the state's independent/ socialist Congressman. Twelve years ago, Stephanie Douglas Hughes fled Long Island, founding her Spirit of Phoenix, where you can buy your herbs, not a dress for your next power lunch.

STEPHANIE DOUGLAS HUGHES, INDEPENDENT: I felt that I would be amongst very progressive people, very open-minded.

DELANEY: Douglas Hughes and thousands of other Vermonters for years fought to keep out Wal-Mart.

DOUGLAS HUGHES: I loved it. I love that Vermont didn't have one, and that it was an issue, and people had a voice about it. Didn't know that could happen.

DELANEY: Native Vermonter and Republican Reg Boucher, once moved away for a few years.

REG BOUCHER, REPUBLICAN: I think it's the water. Coming back to Vermont we went to a high school donkey basketball game. And people were protesting the cruelty to animals. And I just sat back and looked and I said, yep, I'm back home.

DELANEY: For Jim Jeffords, independent, there really is no place like home.

Bill Delaney, CNN, Burlington, Vermont.

(END VIDEOTAPE)

WOODRUFF: New poll numbers for President Bush. Coming up, we'll tell you how the president is doing and why the Democrats see a glimmer of hope.

(COMMERCIAL BREAK)

(BEGIN VIDEO CLIP)

NARRATOR: As Americans set out for summer vacations, gas prices are soaring while the big oil companies continue to post huge profits.

WOODRUFF: The Democrats attack President Bush's energy policies: As gas prices go up, will the president's numbers go down?

From the political to the personal: A look at the man they call the troubadour of his generation.

And why is this man jumping for joy? Instead of "Hail to the Chief," a high five for the president.

ANNOUNCER: From Washington: This is INSIDE POLITICS with Judy Woodruff.

WOODRUFF: After four months in office, a new poll shows President Bush getting generally favorable marks. But as Americans fill their gas tanks for Memorial Day vacations, Democrats are hoping they've found his Achilles heel. A new CNN/"TIME" poll shows 52 percent of the public approves of the way Mr. Bush is handling his job. And about half of all Americans think he's doing a good job on world affairs, the economy and taxes. There are, however, two related areas of concern for the president: Only 38 percent think he's doing a good job on energy, and only 42 percent approve of his performance on the environment.

Democrats are hoping to take advantage of the energy issue with a new advertising campaign. Republicans are countering with Vice President Dick Cheney.

CNN senior White House correspondent John King is keeping an eye on it all, on the emerging debate.

John, first of all, where does the administration's energy policy stand right now now that the Senate is going to be in democratic hands?

KING: Well, certainly a very different debate with the Senate in democratic hands. You had, in the chairman, Frank Murkowski, a senator from Alaska who wanted to go ahead with the president's plan to drill in ANWR, the Arctic National Wildlife Refuge. Senator Jeff Bingaman will take over that committee, he's an opponent. So very much a different debate.

Now, as for those poll numbers, though, Judy. Administration officials view those much more as a reflection of consumer anxiety over rising gas prices, over the California crisis, not so much as any deep-rooted anger at the president or opposition to the president's long-term energy plan, for that matter. But it is also a reminder to us and to the administration that the longer President Bush is in office, the more he is held accountable for problems like energy prices.

The vice president, his point man on all this, was asked about this earlier today, and he said if you step back and look at the energy issue, either from a policy standpoint or a raw political calculation, the vice president making the case, there are no short- term solutions.

(BEGIN VIDEO CLIP)

CHENEY: The problem is, and prices reflect the fact that you've got more demand than you do supply. And if do you do anything in the short-term that doesn't either increase supply or reduce demand, then it's not a solution, it's adding to the problem.

(END VIDEO CLIP)

KING: Now, the administration's view is, the public's view of the president on the energy issue will improve as gas prices begin to come down -- the administration believes they have peaked -- and as the Congress gets about debating the energy plan.

As you mentioned, a very different debate, but the Democrats still trying to have a little bit of fun here. They're trying to pin some of the blame on the president as millions of Americans hop in their car this holiday weekend.

(BEGIN VIDEO CLIP, DNC/DCCC RADIO AD)

UNIDENTIFIED MALE: OK, everybody, come on. Get in.

All right, do you have the cooler?

UNIDENTIFIED FEMALE: Yeah, I have the cooler.

UNIDENTIFIED MALE: OK, good. Good.

UNIDENTIFIED MALE: Okay, Pop!

UNIDENTIFIED MALE: Pop, are you going to drive?

UNIDENTIFIED MALE: Are you kidding? At $2 a gallon, no. We'll picnic right here. Break out the sandwiches.

UNIDENTIFIED MALE: Huh!

NARRATOR: As Americans set out for summer vacations, gas prices are soaring, while the big oil companies continue to post huge profits.

Yet President Bush has offered no relief. Bush's plan would help oil and gas put more money in their pockets, not ours.

(END VIDEO CLIP)

KING: Now, administration officials calling that democratic ad a cheap shot. They also say the Democrats have yet to come up with any reasonable, long-term solutions to the energy problem, as well.

Still, the administration bracing for some protests and a fair amount of skepticism as the president heads, next week, to ground zero in the country's energy debate: the state of California; his first visit there as president -- Judy.

WOODRUFF: Well, John, what should we expect from that trip? What does the president want to accomplish?

KING: Well, he wants to visit some military installations that are covered by that executive order from a few weeks back, you'll remember, ordering conservation on federal facilities, especially at military facilities. The president wants to highlight conservation, but he will also sit down for his first face-to-face meeting with Governor Gray Davis. These two men have waged a cross-country battle over energy, if you will.

The governor saying the one way to help California is to impose price gaps on electricity in the short term. The president saying he will not do that. Nobody expecting a breakthrough or any agreement here, but many California Republicans have been quite critical of the president privately. They say he needs to get out to their state, needs to meet with the governor, needs to show Republicans in the state that he is at least concerned and trying to do something about the energy crisis.

And administration officials here will also probably take some heart in a new poll -- the Field Poll in California showing Governor Gray Davis' numbers going down as well: 49 percent now say the disapprove of the governor's performance; 51 percent say they would not be inclined to vote for his reelection. You talked about numbers showing the president going down, the governor's numbers going down as well -- proof to everybody here at the White House that if you're in charge, you get blamed.

WOODRUFF: John, back on the topic of Senator Jeffords. We know that the Senate Republican leadership has responded to his leaving the party by putting a new moderate republic -- Republican into a leadership role. Is the White House planning to do anything similar?

KING: Well, they are debating behind the scenes exactly what to do. They don't want to do anything dramatic up front because they believe doing so would be, essentially, to accept Senator Jeffords' position, which they reject here, that the president has not been doing enough.

But there was a visitor here at the White House, Representative Amo Houghton, a moderate, some would say liberal, Republican from New York came to see Karl Rove. It was a 15-minute meeting. Mr. Houghton saying the Jeffords defection is a disaster for the party, and that the White House needs to recognize that. And Congressman Houghton told me earlier today he urged Karl Rove to go to the president and ask the president in the very near future to bring all the Republican moderates down here at the White House, promise to work with them, and to then have periodic public events with them to show that he will work with them. Congressman Houghton says he got no response from Karl Rove, but he said he listened quite well, and he's looking for an answer in the near future.

WOODRUFF: All right, John King at the White House.

WOODRUFF: Energy Secretary Spencer Abraham toured a nuclear power plant in Maryland today.

CNN's Brooks Jackson reports he used this appearance as an opportunity to promote nuclear power as part of the administration energy policy.

(BEGIN VIDEOTAPE)

BROOKS JACKSON, CNN CORRESPONDENT (voice-over): It was the first public visit to a nuclear power plant by any Bush administration official. And after he toured the Calvert Cliffs facility in southern Maryland, Energy Secretary Spencer Abraham told CNN he was trying to make a point.

(on camera): What's the message you want to get across?

SPENCER ABRAHAM, U.S. ENERGY SECRETARY: Clearly, I think we want to make sure that Americans understand that nuclear energy already plays a very vital, 20 percent contribution in terms of electricity generation, that we need it to remain an important component in the future. I think by coming here today, we can demonstrate that facilities can be both safe and efficient, and that this one is a good example of that.

JACKSON (voice-over): Calvert Cliffs is the first of the nation's 103 commercial plants to have its license to operate extended for an extra 20 years. It's approved now to operate through the year 2034.

But this and other nuclear plants are getting old, worrying safety experts.

(on camera): I think nine in the last 18 months have had to shut down for repairs because of aging equipment breaking down. Are you, as secretary of energy, satisfied with the safety of these old plants?

ABRAHAM: Actually, we are. But we've made it very clear in our report that safety, in the president's energy plan, safety in nuclear facilities is a top priority.

JACKSON (voice-over): He also made clear another top priority is finding permanent storage for used-up, but still radioactive nuclear fuel.

ABRAHAM: If we can't find a repository for the waste, that it is very unlikely we would see new plants built. We have to move forward in terms of the repository if we're going to expand the number of plants. If that doesn't happen, then I think investors probably won't invest in new nuclear facilities.

JACKSON: We asked if the Bush administration intends to approve a controversial plan, studied for 25 years, to store waste permanently in Nevada, at Yucca Mountain.

ABRAHAM: We want to make sure that the decision we make is one that has a sound basis in science, that can't be criticized for leaving the door open to any kind of risk. And that's why it's cost a lot, and it's taken a long time. But I am fully prepared, once I receive what the science evaluation is, and that -- we think could happen this year, still, to move as quickly but as comprehensively as required to make a recommendation to the president.

JACKSON (on camera): As you know, financially, many of these plants have been disasters for the utilities that built them. Is it going to make economic sense to actually build a new plant?

ABRAHAM: I think it can. But again, not until we can give people assurances that the waste issue will be addressed and is going to be addressed. But I have had, you know, interesting conversations with a number of people in the industry, and certainly have come away with the view that the possibility for adding new facilities exists.

JACKSON: What are the odds, do you think, sitting here right now, that a new plant will be licensed in this administration?

ABRAHAM: Well, I don't know whether or not that would happen this quickly, because clearly we've got to address and surmount the issue of nuclear waste, a repository. But I think if we make progress forward, we'll begin to see the industry examining plans to consider new facilities. I just don't think it's fair right now to predict.

JACKSON: Anything you'd like to add, modify, before we leave?

ABRAHAM: Just that a lot of things have changed since Three Mile Island 20 years ago. And I think the technology advances, both here in the United States and around the world, which have allowed for example the country of France to now generate 80 percent of its energy with nuclear energy, merit further examination.

And certainly justify not only the maintenance of the existing nuclear facilities in our country, but certainly, I think, will be a basis for the expansion of the role that nuclear energy can play in the future.

Mr. Secretary, thank you very much.

(END VIDEOTAPE)

WOODRUFF: And a Democratic congressman says he was refused admission to the Department of Energy by security guards who asked if he was an American citizen. Representative David Wu of Oregon said he was supposed to address Energy Department employees Wednesday in order to mark Asian-Pacific American heritage month. And he was denied access, even after showing his congressional identification. He discussed the incident on the House floor today.

(BEGIN VIDEO CLIP)

REP. DAVID WU (D), OREGON: I am going to encourage the Department of Energy to redouble its efforts, engage in the true process of soul-searching. Do you really ask everyone their citizenship at the door? And if so, is that an effective way of enhancing national security?

(END VIDEO CLIP)

WOODRUFF: An Energy Department spokeswoman says there was a mix- up because she said Wu tried to enter the building through an unexpected entrance. She says everyone who arrives at the building is asked about citizenship, and she denied that the congressman was asked repeatedly. Energy Secretary Spence Abraham later visited Wu's office at the Capitol and apologized.

Politics set to music. When we come back, a look at the voice of a turbulent generation, still active after all these years.

(COMMERCIAL BREAK)

WOODRUFF: It is almost impossible to separate the politics of the '60s from the music of the '60s. This week, one of the lead voices of those protest songs, Bob Dylan, turned 60. Our Jeff Greenfield joins us now with some thoughts on Dylan's music and his political effect -- Jeff. JEFF GREENFIELD, CNN SENIOR ANALYST: A 60-year-old Bob Dylan, you say? That's impossible. Why, that would make me -- never mind.

The fact is, it was more than 40 years ago that a skinny kid named Zimmerman out of Hibbing, Minnesota started showing up at Greenwich Village folk clubs. In the decades since, his songs have indeed helped to chart the life's journey of a generation, personally and politically.

(BEGIN VIDEOTAPE)

UNIDENTIFIED MALE (singing): My mother prayed that I would be a man of some renown.

GREENFIELD (voice-over): Union songs of Joe Hill, to Woody Guthrie "This Land Is Your Land"...

UNIDENTIFIED MALE (singing): This land is your land, and this land is my land.

GREENFIELD: To Pete Seager and the Weavers, folk songs have been the marching music of the American left.

UNIDENTIFIED MALE (singing): They stood up to McCarthy, they saw through Tricky Dick.

GREENFIELD: It's music for the CIO, not the CEO.

In this first years, Bob Dylan was very much in that tradition: "Masters of the War," written and sung in white-hot anger.

BOB DYLAN, MUSICIAN (singing): They played with my world, and it's your little toy.

GREENFIELD: And he wrote not one, but two of the most familiar anthems of the '60s. "The Times, They Are A-Changing"...

DYLAN (singing): Oh, the times, they are a-changing.

GREENFIELD: And the song that Peter, Paul and Mary turned into a top 10 hit.

UNIDENTIFIED MALE (singing): The answer, my friend, is blowin' in the wind.

DYLAN (singing): The answer is blowin' in the wind.

GREENFIELD: Such songs stand as the soundtrack of the mid-'60s, when civil rights and the escalating war in Vietnam politicized at least part of a generation.

But in 1965, Dylan made a bold musical leap: going electric, as the phrase had it, fusing his lyrical power to the energy of rock'n'roll, as he did with "Subterranean Homesick Blues," seen here in the film, "Don't Look Back." It was this leap of Dylan's that helped persuade other, even more popular rock acts, to try more daring music: the carefully packaged Beatles, for example, or the Rolling Stones, with "Street Fighting Man."

And just as his generation moved from politics to the personal, so did Dylan's music. Has anyone ever written an angrier song about personal betrayal and revenge than "Positively 4th Street?"

Now, 40 years on, Dylan's creative energy seems born again. His "Things Have Changed," from the film "Wonder Boys," won him an Oscar this year.

(END VIDEOTAPE)

GREENFIELD: And yet, for all the power and brilliance of his personal songs, and for all those tales of lost loves and friendship and regret, Dylan will always inevitably be seen by millions as what Kris Kristofferson once called him, "the troubadour of a generation." In fact, I suggest it is almost impossible to think back on those times without thinking of Bob Dylan's words and music -- Judy.

WOODRUFF: And I agree with you. All right, Jeff. I want you to stay with us, because we are going to bring in Robert Christgau of "The Village Voice" now to talk a little more about Bob Dylan.

Robert Christgau, did Bob Dylan start out intending initially to have a political impact?

ROBERT CHRISTGAU, "THE VILLAGE VOICE": I think at the very beginning he was probably taken up with those ideas. Those were the people he was hanging out with. They were inspiring him. They were his audience.

But you know, he last attended a demonstration in 1963, and he was forswearing politics and complaining about the ideology of the left by 1965. He still wrote songs that had political implications, but quite clearly, he had rejected the folk music movement per say pretty quick.

WOODRUFF: If that's the case, Jeff Greenfield, why did the political world embrace him so, continue to embrace him so, the political left?

GREENFIELD: I think that what Robert said is exactly on point. I mean, I think that a lot of the generation of the '60s kind of got locked into a particular time period. I mean, Bob Dylan has been writing some pretty impressive songs for more than 35 years after he left politics. In fact, when he went electric in 1965, his followers booed him, they regarded him as a sellout because he wasn't sticking to the pure, if I may use this term, politically correct music.

But you know, things you remember when you were young implant in your brain very powerfully. I was at the March on Washington, and that's 38 years ago and I remember it as if it were yesterday. So I think a generation that -- whose most tumultuous times came early see Dylan not as he was for 35 years on but the way they first saw him.

WOODRUFF: Robert Christgau, he had to change, though, to remain popular, didn't he?

CHRISTGAU: I don't think that's why he did it. I think he was very, very ambitious, but I think he was always following his own muse, his own compulsions, which are pretty deep and complex. He -- and I mean, he's done that to this day.

He -- you know, he actually hasn't done a lot of original music in the last 10 years. He did more in the '80s, but most of it wasn't very good.

What he is now is a touring musician. He tours 100 nights a year, plays the music he wants to play, plays the songs he wants to play, writes new songs when he feels like. He's revived old folk song. And he makes political statements every once in a while, but you don't even really want to know what they are.

In the notes -- in the notes to one of those folk albums, he calls this the new dark ages. Well, I think -- I mean, I'm a leftist, but I think that's going a little far.

WOODRUFF: Jeff Greenfield, just quickly, other -- not every generation has had a troubadour like Bob Dylan. Did this generation need one?

GREENFIELD: Well, I don't know if we needed one. We took one. I mean, not -- first of all, not every generation is as self-conscious as the '60s generation. But also, it was -- I mean, in fairness, even when you scrape away all the excess and the hype, what happened between 1964, and say, 1972 really was quite remarkable. And I think that -- I think really, as I said in the piece, the fact that he did that leap of musical faith in 1965, in some ways, the most important thing he did was he made rock'n'roll music, which was considered kind of in for a dig, respectable, interesting, complicated. It let people like Robert Christgau, a really smart guy, make a living analyzing it. A little bit hard to do that in the first few years of rock'n'roll.

So whether we needed it or not, we got one, and he is a protean guy, you know. He's a guy who went from "The Times, They Are A- Changing," to "The Changing of the Guard," to "Things Have Changed." That's almost a 40-year span of music. So I guess you'll -- he'll keep changing.

WOODRUFF: Robert Christgau, is there anybody else out there we can compare to Bob Dylan, or is he -- he stands alone?

CHRISTGAU: Well, you know, I think all those good things would have happened to rock'n'roll if Bob Dylan had never been born. My favorite Dylan line is actually completely germane to that observation. It's "Don't follow leaders, watch the parking meters." Parking meters would have been there anyway.

(LAUGHTER)

WOODRUFF: OK. We will remember that. Robert Christgau, Jeff Greenfield, thank you both. We appreciate it.

And happy birthday, Bob Dylan.

Another day, another graduation speech for President Bush. We'll tell you about it when INSIDE POLITICS continues.

(COMMERCIAL BREAK)

WOODRUFF: We have some new information at this hour about the tax cut negotiations going on, on Capitol Hill. A senior House Republican aide has told our Kate Snow that at this point it is expected to include some form of rebate check for taxpayers. But the amount of the check is still being negotiated.

As for changes in the tax rate, the upper income tax bracket would fall, at this point that is, from the current 39 percent down to 35 percent. Also, there could be some extra relief for high-income taxpayers, possibly in the form of a personal exemption.

The overall number of tax brackets and the categories they cover remain unclear.

And finally, the estate tax at this point -- again, we're reporting what the stage of negotiations is -- would be eliminated, but how quickly it would be phased out still under discussion. Again, that according to a senior Republican aide to our Kate Snow.

Much more INSIDE POLITICS coming up, but now let's go to Lou Dobbs for a preview of what's ahead at the bottom of the hour on "MONEYLINE."

Hi, Lou.

LOU DOBBS, HOST, "MONEYLINE": Hi, Judy, thanks.

Coming up, a profits recession grips corporate America, and that is sending stock prices tumbling into the holiday weekend. We'll be going live to the New York Stock Exchange and the Nasdaq. We'll be talking with Merrill Lynch's Dick McCabe about what we can expect.

Also tonight, the man whose money helped spawn the high-tech revolution, venture capitalist John Doerr. And after a shakeup in the Senate, we'll hear from one of Washington's most biting commentators: P.J. O'Rourke.

Please join us. "MONEYLINE" begins in just a few moments.

(COMMERCIAL BREAK)

WOODRUFF: President Bush was the guest of honor today as the Naval Academy graduated its class of 2001.

Once again, as in a recent appearance at Yale, Mr. Bush poked fun at his own academic mediocrity. He even gave a boxed golf ball to one mediocre student. This jumping midshipman you saw a moment ago is this year's "Anchor," the traditional name for the student graduating at the bottom of the class. The Anchor gave the president a friendly hand slap and then a great big bear hug.

As well he should.

That's all for this edition of INSIDE POLITICS. But of course, you can go online all the time at CNN's Allpolitics.com. AOL keyword: CNN. Our e-mail address is insidepolitics@cnn.com.

And this programming note: Soon-to-be Senate Majority Leader Tom Daschle will be the guest tonight on "WOLF BLITZER REPORTS." That's at 8:00 p.m. Eastern. I'm Judy Woodruff. "LOU DOBBS 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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