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CNN LATE EDITION WITH WOLF BLITZER

Ford, Barr, Torres Debate Condit's Political Fate; McConnell, Dorgan Discuss Expected Budget Battle; Robinson Talks About Condit Interview

Aired September 2, 2001 - 12:00   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.
WOLF BLITZER, HOST: It's noon in Washington, 9:00 a.m. in Modesto, California, 6:00 p.m. in Durban, South Africa, and 7:00 p.m. in Jerusalem. Wherever you're watching from around the world, thanks for joining us for this two-hour LATE EDITION.

We begin here in Washington, where there has been a new development in the Bush administration's effort to generate international support for its controversial missile defense system. CNN's Kelly Wallace is at the White House right now with details.

(NEWSBREAK)

BLITZER: And of course, Bill Clinton, as all of us remember, promised to focus on the economy, as well, like a laser beam. We'll have more on that coming up shortly. We'll talk about the shrinking surplus with Senators Mitch McConnell and Byron Dorgan.

But now we turn to the case of missing Washington intern Chandra Levy. The investigation is now entering its fifth month, with police acknowledging they still have no hard leads. In the meantime, Congressman Gary Condit, who's been at the center of the uproar, seems to find himself in increasing legal and political turmoil.

CNN national correspondent Bob Franken once again joins us from the Congressman's Democratic district out in California in Modesto.

(NEWSBREAK)

BLITZER: And with us now to talk more about the reception Congressman Condit is likely to receive on Capitol Hill are three guests: Here in Washington, Democratic Congressman Harold Ford of Tennessee; joining us from Colorado Springs, Colorado, Republican Congressman Bob Barr of Georgia; and in San Francisco, the chairman of the California Democratic Party, Art Torres.

Gentlemen, thanks for joining us. Welcome to LATE EDITION.

And, Congressman Ford, let me begin with you. Clearly, the reception he's going to receive upon his return to Washington -- assuming he returns, and we all assume he will return -- is going to be a lot different than the mood that was here before he left. REP. HAROLD FORD JR. (R), TENNESSEE: I think the general feeling is that people are profoundly disappointed with how he conducted himself throughout the interview. The blaming of others for some of the problems that he created for himself, the evasiveness early on in the investigation. I'm a lawyer, you know. You would hope that all of those who are interviewed would be truthful and candid and forthcoming.

And I was disappointed in his interview. He's a friend, and it hurts me to say this, but I was deeply disappointed. I know my leader was and others throughout our party are. And we'll have to wait and see when Congress returns what, if any, action might be taken against him.

BLITZER: Like Congressman Condit, you're a so-called Blue Dog Democrat, conservative Democrat. You're from Tennessee. The bottom line, though, do you think that he should, A, seek re-election or, B, resign?

FORD: The voters will handle all of those issues one way or the other, and I trust the voters in Modesto, California to do what's in their best interests.

I do know that he's a member of the Intelligence Committee here in the House. They handle very sensitive issues dealing with national security. And I would suspect that Leader Gephardt or Dick Gephardt will follow the rules of our caucus and do what's not only in the best interests of Democrats but do what's in the best interest of the country.

Again, as I say, he's a friend and it hurts me to say this, but he put himself in this position.

BLITZER: Doesn't sound like a lot of support, but we're going to get back to you, going to get some more on your views in a second.

But, Congressman Bob Barr, you've been at the forefront among Republicans and others, urging Congressman Condit to resign. You want the House Ethics Committee to get involved. So far, doesn't appear that they're going to raise this issue.

First and foremost, why do you think among Republicans, at least, there's such a small number who are taking your position, speaking out as forcefully, as bluntly as you are?

REP. BOB BARR (R), GEORGIA: Well, it's sort of standard operating procedure for Congress, regardless of whether a member is on the Democrat or the Republican side, there is a tremendous hesitancy to move off of the status quo. Most members are very comfortable just sort of maintaining the status quo. They don't like controversy. So it's a natural reaction, unfortunately, when a member gets in trouble to just sort of forget about it and hope the problem goes away so you don't have to deal with it.

Unfortunately, this problem is not going to go away. The integrity of Congress has been called into question by Mr. Condit's obstruction and tampering and interference with an investigation.

I was very pleased to see on your show just one week ago, on this very program, that Charlie Rangel, our Democrat colleague from New York, seemed very clearly to indicate that he did agree with me that there is sufficient evidence before the Ethics Committee at this point to least begin an investigation.

BLITZER: Well, have you heard back from the Ethics Committee that they're about to do something along those lines?

BARR: No, unfortunately, I haven't. As you know, Wolf, I've written four letters to the Ethics Committee urging them in very specific terms, based on what I know of the federal law as a former prosecutor who has prosecuted both Democrats and Republicans, federal officeholders, to look into. But I have received only one letter back from them quite some time ago.

So, at least at this point, unfortunately, it appears that they're not terribly interested in this.

BLITZER: Art Torres, you're the chairman of the Democratic Party in California.

The Democratic governor of California, Gray Davis, spoke out about Gary Condit earlier in the week. Let's run a little excerpt of what Governor Davis had to say.

(BEGIN VIDEO CLIP)

GOV. GRAY DAVIS (D), CALIFORNIA: I have known Gary and worked with him for many, many years, and so what I'm about to say doesn't bring me any joy whatsoever. I didn't see the interview. So my information comes from news accounts and the transcripts of the interview. But I'm disheartened that Congressman Condit did not speak out more quickly or more fully.

(END VIDEO CLIP)

BLITZER: Art Torres, is the Democratic Party in California abandoning Gary Condit at this point?

ART TORRES, CALIFORNIA DEMOCRATIC CHAIRMAN: I think we have great concerns. I think the governor expressed those concerns. As Harold said, Dick Gephardt as well, we're concerned about when any member of the Democratic family is in trouble, as is the case with Gary Condit, and we hope he makes a right decision. He has until December 7 to do that.

BLITZER: Well, what do you want him to do?

TORRES: As chairman of the party, my responsibility is to make sure that we win elections, number one; number two, that we have strong Democratic districts across the state. And that's what he we did for the Condit seat, as we did for many other seats in California.

And as chairman, I don't think it's my place to tell an incumbent member of Congress what to do. He's smart enough. He knows what the figures are, he knows what the polls are looking like, he knows his district. He's got to come to his own conclusions.

BLITZER: Well, if he decides to seek re-election, will you support him? Will the Democratic Party in California seek some primary run-off, for example, another candidate, as a Democrat?

TORRES: Well, I think we've heard a lot of other candidates that are talking about running in the primary against Gary if he decides to seek reelection.

The Democratic Party in California will not endorse any candidate for Assembly, Senate, or Congress in this coming election because of reapportionment and the time frame that's involved with our March primary. So we won't -- we'll let voters of Modesto and Stockton and Merced decide what to do in anticipation of a November election.

BLITZER: Congressman Ford, as you know, the children of Gary Condit, Chad Condit, Cadee Condit, his daughter, they were working for Governor Davis. They both resigned in protest to what Governor Davis had to say.

And I want to read excerpt from their letter. They said this: "You may remember our father's strong public support, endorsement and organizational efforts for you during the bleakest moments of your 1998 primary campaign. It is that kind of loyalty to friends that has been the hallmark of his career. Friendship should not be based on poll numbers. Therefore we respectfully submit our resignations, effective immediately."

Have the Condits, the entire Condit family, been treated fairly by the Democratic leadership, including the leadership in the Congress, Gephardt, who's your leader, Dick Gephardt, the House Democratic leader, and leadership of the Democratic Party in California?

FORD: I believe so, and I have -- I only know the Condit children, the Condit Congressman's children, through what Governor Davis might have said.

I think we have been. I think there are many of us who wanted to hear Gary emphatically say that he had nothing to do with the disappearance, and to speak truthfully and fully about his relationship with Ms. Levy.

After watching the interview and reading all the press accounts and listening to the Levy family, who my prayers continue to go out to as I hope they find their daughter Chandra, I was not convinced that he had.

The finger-pointing and the blaming, perhaps that's a defense mechanism on Gary's part. Nonetheless, it has certainly brought discredit to the House.

This has nothing to do with poll numbers. I think it has to do with people's own moral compasses. There's a young lady that is missing. I've heard comparisons drawn between the president, and I don't -- I'm not here to defend President Clinton and Gary Condit, but there was no one missing in that situation.

Gary may have had nothing to do with this, I don't know. But my concern and my criticism is leveled at my colleague and friend because of the way he's conducted himself, for handling himself subsequent to this young lady's disappearance. He could have been more forthcoming, could have been more truthful and could have been more candid in his questioning by the police and even by Ms. Chung and others. And perhaps could have avoided some of the criticism and scrutiny that continues to dog him today.

BLITZER: When you say you don't know if he had anything do with disappearance of Chandra Levy, are you leaving open the possibility that he might have had something to with her disappearance?

FORD: I'm not a judge nor a jury, nor am I privy to any of the evidence. What I do know is how Gary has conducted himself since her disappearance. At a minimum, his conduct has been curious; at worst, it's been very, very suspicious. As a lawyer, I know that could mean absolutely nothing. However, as a member of Congress and one who respects this body and institution and has affection for my friend, I'm deeply concerned.

After hearing his interview, and reading his responses to many of the questions, he did nothing to reassure me, I think, or reassure other members of Congress that he is willing to accept responsibility for how he has behaved since her disappearance.

BLITZER: All right, Congressman, stand by. We're going to take a quick break. We have a lot more to talk about, including bringing Bob Barr back into this conversation.

We'll continue our conversation with Herald Ford, Bob Barr, and Art Torres. And then they'll also be taking your phone calls when LATE EDITION returns. Stay with us.

(COMMERCIAL BREAK)

BLITZER: Welcome back to LATE EDITION. We're continuing our conversation with Tennessee Democratic Congressman Harold Ford, Georgia Republican Congressman Bob Barr and California State Democratic Party Chairman Art Torres.

And Bob Barr, let me begin with you this time. As far as we know, the police have not said that there is any hard evidence whatsoever linking Congressman Condit to the disappearance of Chandra Levy. Do you suspect that he may have had something to do with her disappearance?

BARR: Well, first of all, I don't think that the D.C. police have shown themselves to be the epitome of top-notch law enforcement, so I'm not sure whether because they consider somebody or say they consider somebody a suspect or not really means anything. This is the same police department that failed to interview key witnesses early on, that failed to gather evidence as obvious as the security tapes from the apartment until they were already erased. So I'm not really sure.

I have no idea whatsoever, trying to read between the lines or look at the reporting, whether or not Mr. Condit had anything to do with her disappearance. It's unfortunate to have to reach that conclusion. One would like to say that certainly we have faith in all of our colleagues that they would not have anything to do with that, but I don't know at this point.

I do know -- and this is what I've asked the Ethics Committee simply to do. And Harold Ford said that his colleague has brought discredit on the House, and that's the basis for the Ethics Committee in investigating to see whether or not the allegations and the evidence so far that Mr. Condit obstructed justice, attempted to tamper with witnesses and interfered with an investigation did occur. And if so, then that clearly is the sort of behavior that does bring discredit upon the House and ought to be basis for some action by the Ethics Committee.

BLITZER: Art Torres, let's get back to the whole issue of California politics. The new issue of the Almanac of American politics just came out, which went to press before this huge uproar. Among the things they wrote in there was this. We'll put it up on the screen.

"The district lines in the fast-growing Central Valley will be shifted at least somewhat by redistricting. Democrats control the redistricting process and could try to make the 18th District more Democratic, although Condit will likely be safe whatever the boundaries."

Clearly written before all of this uproar.

The question is this. You added some Hispanic areas to that district. What message are you telling Gary Condit by the redistricting that the Democrats came up with in the state legislature? What's the message you're sending to Gary Condit?

TORRES: Well, the message was given a long time before Gary's problems emerged. And quite frankly, Senator John Burton, who's president of our Senate and our speaker here, clearly indicated that we're going draw the lines to help increase voter registration -- as any party in power will do -- for Ellen Tauscher, for Mike Honda, for Adam Schiff, for any of the districts that we considered marginal.

The population, the Latino population, has increased substantially in that area, so it made a lot of sense to increase it long before Gary had his problems. So by increasing voter registration to Democrats to 51 percent, it's not a safe Democratic seat. It still is a marginal, very competitive seat, and allows the opportunity some way down the future for a Democrat who happens to be Latino to run for office. And that's been the hallmark of our party -- to reach out to the Latino community, not only in California but across the nation, to let them know that empowerment begins with the Democratic Party for the Latino community.

BLITZER: Congressman Ford, your colleague Charlie Stenholm, the Democrat from Texas, another Blue Dog Democrat, was on Fox News Sunday earlier today, asked about Gary Condit. Listen to precisely what he had said earlier today.

(BEGIN VIDEO CLIP)

REP. CHARLES STENHOLM (D), TEXAS: I think you've seen the actions of Gary over this last month. I was very disappointed in the interview with Connie Chung. I thought he lost the opportunity to bring a lot of answers to the questions surrounding him.

(END VIDEO CLIP)

BLITZER: Is it time for the Democratic leader in the House, Dick Gephardt, to ask Congressman Condit to leave the House Intelligence Committee, which, as you know, deals with the nation's most secret information?

FORD: That's a decision for the leader to make, and I'm sure he will have the evidence before him.

There are those of us, as I've said -- as Charlie Stenholm, who's a closer friend to Gary than I am, has known him for a lot longer time than I have. There are deep, deep concerns and Gary will have to answer those questions that I'm confident will come from the leader. And the leader will have my support, as I'm sure he will have broad support within the Democratic caucus with whatever he choose to do.

I'd say to Art Torres, we've seen an enlarge or swelling of our Latino population in Memphis, as was documented this morning in one of our morning papers. And I look forward to continuing to represent those in my district. And I applaud them in California for the redistricting, the way they've drawn the lines there in California.

TORRES: We've got to teach you some Spanish, Harold.

FORD: I'm going to call you, Mr. Torres.

(LAUGHTER)

BLITZER: All right, let's get back to Congressman Barr.

You've been among those who have been urging Gephardt to remove Condit from the Intelligence Committee. He hasn't been charged with anything as far as we know, no criminal wrong doing.

Is there a bad precedent that might be set by this -- what some are calling this railroading against Condit to try to get him removed from this committee even before he's been accused of any actual wrongdoing?

BARR: Well, he has been accused of wrongdoing.

A number of us, both within the Congress as well as outside the Congress, other lawyers, other witnesses, others involved in the case, believe that he has committed wrongdoing, such as obstruction of justice. BLITZER: What about criminal wrongdoing?

BARR: Well, I think, Wolf, we faced this in the impeachment of Mr. Clinton, as well, a couple years ago. If the criteria in 21st century America is, we will leave people in positions of great power until they are proved guilty of a criminal offense, that's a very, very low standard that has not held throughout our history.

The Congress has the responsibility that is beyond simply whether or not somebody has committed a criminal offense. If we believe that there is evidence that somebody has brought discredit to the House -- it may not be a criminal proceeding -- if we believe that somebody has shown themselves unworthy of maintaining a high position of sensitivity, such as service on the Intelligence Committee, then we have an absolute obligation to act. And it is completely independent of whether somebody is proved guilty of a criminal offense.

BLITZER: All right. Let me just bring back Art Torres for a moment.

Is there anything Congressman Condit can do effectively right now that will allow him to come back politically, not only run for re- election but win that seat?

TORRES: I don't know, Wolf. Right now the signs are not very positive, not only in his district but obviously across the nation. But the people of the 18th Congressional District have to come up with that decision on their own. And maybe Gary may decide not to seek re- election prior to putting himself up through that again, but that's his decision to make.

And as I said, December 7 is the deadline, but right now we're all very concerned about what his prospects might be in a primary and clearly in a general.

BLITZER: Congressman Ford, while I have you, Congress comes back to session this week.

One of the issues in the House of Representatives, campaign finance reform, passed the Senate, as you know, in the McCain-Feingold legislation. It's questionable in the House of Representatives, in part, because the Congressional Black Caucus, or at least some members, have misgivings about eliminating so-called soft money, the unlimited sums that go to these political parties.

You're a member of the Congressional Black Caucus. Which way are you going to come down on this fight?

FORD: I support campaign finance reform, but I would disagree with your assessment in one sense. The Black Caucus is not blocking consideration of the bill. The Republican leadership in the House can bring the bill to the floor. What the CBC members, some have done, and I'm not a part of that group, is to refuse to sign a discharge petition.

But Mr. Hastert or Mr. Armey can bring the bill to floor, allow a fair up-or-down vote on this issue. And if it passes, it passes, and it goes to conference between the House and the Senate. If it doesn't, then we can find out who didn't vote for it. Right now it's unfair to do it.

Whatever we do with Gary Condit, I hope we do swiftly. We have this issue to deal with, the budget to deal with, a shrinking surplus and issues that I think the American people want us to deal with. And I'm confident that leader Gephardt and others will deal with this as quickly as possible and allow the Congress to get back to doing what we do best, which is, we hope, making lives better for people in Memphis and all across this nation.

BLITZER: Congressman Barr, you're going to have the last word. Why won't the Republicans, the leadership of the Republican Party, allow the campaign finance reform legislation to come up for a vote anytime soon?

BARR: Two things, Wolf. One, it's bad legislation. It's unconstitutional. But more important than that, the proponents of campaign finance legislation, one month ago, got greedy. They tried to pull some parliamentary tricks. It didn't work, it backfired on them. They lost the ability to bring it to the floor by their own greed.

BLITZER: All right. So that's where we leave it on campaign finance reform and on Congressman Condit.

I want to thank all three of our guests, Harold Ford, Bob Barr, Art Torres for joining us today on LATE EDITION.

And just ahead, as Capitol Hill lawmakers prepare to get back to business, we'll talk with two senators who will be leading the debate over the budget, Social Security and much more: Democrat Byron Dorgan of North Dakota and Republican Mitch McConnell of Kentucky.

LATE EDITION will continue right after this.

(COMMERCIAL BREAK)

(BEGIN VIDEO CLIP)

GEORGE W. BUSH, PRESIDENT OF THE UNITED STATES: This year we might even see our administration's two highest priorities, education and national defense, being played off against each other. That's the old way of doing business, and it's time to stop it.

(END VIDEO CLIP)

BLITZER: President Bush warning Congress against playing politics with the budget. Welcome back to LATE EDITION.

Joining us now are two members of the Senate who will play a key role in the upcoming budget debate. Both serve on the powerful Appropriations Committee. Here in Washington, Democratic Senator Byron Dorgan of North Dakota, and in his home state of Kentucky, Republican Senator Mitch McConnell. Senators, good to have you back on LATE EDITION.

And, Senator McConnell, let me begin with you. The fact is that the budget surplus numbers are shrinking, they're going way down. The Congressional Budget Office this past week suggested that the Bush administration might even have to dip into the Social Security payroll tax surplus, something that the administration had earlier vowed it would not do.

How serious of a problem for Republicans, looking towards 2002, is this shrinkage of the surplus?

SEN. MITCH MCCONNELL (R), KENTUCKY: I don't think it's serious at all. We're going to have the second-biggest surplus in American history, and we're in the process of passing the appropriation bills reflecting this -- the budget resolution we already passed for '02.

Using both OMB and CBO numbers, the Congressional Budget Office numbers being somewhat more pessimistic, we can fund the president's priorities in defense and education.

And I'm optimistic that Senator Byrd, the chairman of the Appropriations Committee, who's been very statesmanlike during this whole process, will help us stick to the budget agreement. And if we do that, Wolf, there's plenty of money to do everything the president would like us to do and that we would like to do, and still have the second-largest surplus in history.

BLITZER: All right. Senator Dorgan, plenty of money to do everything the president wants to do, missile defense, education, across the board, and not have to dip into the Social Security trust fund.

SEN. BYRON DORGAN (D), NORTH DAKOTA: Well, first, let me correct this, with deference to my friend Mitch McConnell, there is no surplus. The surplus has evaporated. When he says we have the second-largest surplus in history, that's what the head of OMB says, all of that money they're referring to is Social Security trust funds.

Now, all of the workers in this country see something taken out of their check every pay period. It's supposed to be put in a trust fund. It's called a "dedicated Social Security tax." Mitch Daniels, the head of OMB, this morning on another show said, "Well, it's really not dedicated."

And that's why they talk about this surplus. It is not a surplus. That is a dedicated trust fund. And in my judgment, everybody ought to keep their hands off that trust fund. It doesn't belong to the government, it belongs to the American people. They're the ones that paid that tax into the trust fund.

BLITZER: Senator McConnell, the Republicans, like the Democrats, vowed to have that so-called Social Security lockbox and not use any of that money.

MCCONNELL: I think that's a good idea. You know what Byron really wants to do is raise taxes. Unfortunately for him, 12 of the Democrats in the Senate in his party supported the tax cut. And what Senator Daschle and Representative Gephardt have been edging right up to is suggesting that we repeal the tax cut, in effect, raise taxes during an economic slowdown. I don't think there's any economist in America who thinks that's a good idea.

And so, I'm wondering if Byron is going to suggest that we repeal the tax cut.

DORGAN: No, it's a clever but inaccurate description of where I stand. I'm not suggesting that we raise taxes at this point. I am suggesting we ought to keep our hands off the Social Security trust funds. They don't belong to the government. They're put in a dedicated trust fund. They come out of the paychecks of workers, and they ought to stay in that trust fund.

But the fact is, this whole budget scheme doesn't add up. Now, in just a very short period of time, the budget surplus evaporated.

What I think we ought to do at this point is understand that we need a new budget summit of some type to be talking about, how does the president now fund the increase in spending he wants? He's the one that's talking about a very substantial increase in defense, he wants an increase in education. Where is that going to come from? It doesn't exist in the current budget full of fuzzy math.

And in my judgment, what we ought to do is get the leaders of both sides together -- we have a divided and split government, almost right down the middle -- come together and decide how we're going to accomplish all this, and how we put together a fiscal plan that really does add up finally.

BLITZER: Senator McConnell, is that a good idea?

MCCONNELL: Wolf, we clearly do have a difference on this. Under the budget resolution that we passed, the president's education increase and defense increase are accommodated in that budget agreement. Senator Byrd, the chairman of the Appropriations Committee, has indicated that he believes we ought to stick to the budget agreement. He's done that so far, in operating the Appropriations Committee.

I think we ought to stick to the budget agreement. And if we do that, we will not be encroaching on the Social Security surplus.

DORGAN: Well, if I might just make the point, that budget agreement was reached at a time when there was expected to be about 125 to 130 billion more dollars than now exists. That has evaporated, that's gone. Things have changed.

You know, Will Rogers once said, when there's no place left to spit, you either have to swallow your tobacco juice or change with the times. In my judgment, there's no place left, we need to change. How do we do that? We ought to have a budget summit now and recognize these new realities, keep our hands off the Social Security Trust Fund, and try and figure out how you have a budget that adds up.

BLITZER: Well, one of the problems...

MCCONNELL: Wolf, Wolf, if I could.

BLITZER: Go ahead, Senator.

MCCONNELL: Wolf, if I could, just briefly. Obviously we're in an economic slowdown; it began last year. And that's the reason the surplus is not as big as it was going to be. However, we did exactly the right thing, in cutting taxes to help stimulate the economy, to get the economy moving again. And all we have to do is stick to the budget agreement that we already passed, and I believe that we will do that.

BLITZER: And on that point, Senator Dorgan, Karen Hughes, the counselor to the president, is quoted in today's "Washington Post" as saying this: "Consumers are worried about the economy. I have yet to see a Democratic proposal to stimulate the economy. They're leaning toward the worst thing possible, raising taxes."

DORGAN: Actually, the tax rebate from this year was a Democratic proposal, the president's tax plan had no rebate in it. The Democrats were the first to propose it.

But, look, what the people are worried about in my judgment and the reason that we have this soft economy that's getting softer, is they understand these numbers don't add up. You know, this economy is nothing more than people's confidence. If people are confident about the future, they do things that manifest that confidence.

BLITZER: But right now is there a Democratic proposal on the table to do anything else, beyond what's already in place, to stimulate the economy, which obviously is a source of enormous problems right now?

DORGAN: Well, the first law of holes is, when you're in a hole, stop digging. I mean, we don't have our plan in place. The president won. I mean, it's his budget.

And what we need to do at this point is understand -- I disagree with my friend Mitch McConnell on this issue of whether there's $18 billion available, as the president wants for defense increases next year, in the current circumstance. It is not available unless he comes to us and says, "Here's how I will fund that."

BLITZER: Senator McConnell, when the Republican White House and the leadership in Congress, the Republican leadership, came up with their proposals earlier this year, look at the budget surplus numbers that were projected over the next three years. We'll put them up on the screen.

They then proposed last May when the tax cut was approved, they thought there would be $275 billion surplus this year, $304 billion next year and $353 billion the year after that. Look at the revised CBO, Congressional Budget Office, numbers that came out this past week: $153 billion this year, $176 next year, $172 the year after that, almost all of which of course, comes from the Social Security payroll tax.

There's about, what, $430 billion less over these three years in budget surplus numbers than had been earlier projected. Yet we don't see any additional stimulus that the administration, the Republican leadership, is proposing right now either.

MCCONNELL: Well, we passed a major stimulus by sending $40 billion dollars back to 90 million American taxpayers, which my friend Byron thought was a bad idea. He now wants to take credit for the rebate part. In fact some of the Democrats wanted to rebate even more, in which case they would have had an even more difficult problem now.

Fundamentally, the key to this is to stay the course with the budget resolution, for the president to keep us from over spending -- which we've done each of the last couple of years at the urging of then president, who would veto bills, saying we hadn't spent enough.

I think the president will help us and I think Senator Byrd will be cooperative in helping us stay within the budget guidelines. The key to increased surpluses in the out-years is to get the economy going again. The reason the surplus projections are going down is because we have a slow economy.

DORGAN: Well, let me just say, staying the course means that we will take about $500 billion, a half-a-trillion dollars of Social Security trust funds and use them for something else. That is not what the president promised the American people, and it's not what we promised them in the Congress.

That is not a laughing matter, Mitch. The fact is, this money doesn't belong to the government. It belongs to the American people. They're the ones that paid the taxes and the government told them -- this is about character and it's about honesty. The government said, we'll put this in a trust fund for your retirement. We need those funds when the baby boomers retire.

Now if you're going to take them and use them now by staying the course, what are you going to replace them with when the baby boomers retire?

MCCONNELL: Byron's playing big games without your projections, and nobody knows what the surplus is going to be two or three years from now.

BLITZER: All right, Senators, stand by. We're going to continue this conversation. We have a lot more to talk about.

And when we return, as well, your phone calls for Senators Mitch McConnell and Byron Dorgan. LATE EDITION will be right back.

(COMMERCIAL BREAK)

(BEGIN VIDEO CLIP) BUSH: I presume those who now oppose tax relief are for raising your taxes. That would tie an anchor on our economy, and I can assure you I won't allow it.

(END VIDEO CLIP)

BLITZER: President Bush issuing a stern warning to Democrats. Welcome back to LATE EDITION.

We're continuing our conversations about the looming budget battle with North Dakota Democratic Senator Byron Dorgan and Kentucky Republican Senator Mitch McConnell.

Senators, we have a caller from Seattle. Let's go ahead with that question right now. Please go ahead, Seattle.

CALLER: Yes, Senator McConnell, because the Bush tax plan doesn't add up, would you be willing to repeal any part of the Bush tax plan, such as the inheritance tax?

MCCONNELL: Absolutely not. The 12 members of the Senate who were Democrats voted for the president's tax plan. The tax rebate was exactly the right thing to do in an economic slowdown. The government was awash in a sea of surplus. It's time that we get some of the money back in hands of the American people. It's, after all, their money, not ours.

BLITZER: Let me shift gears for a second while I have both of you and ask you a question about what's in the news today.

I'll begin with you, Senator Dorgan. This notion that the United States should share some of the information with China about missile defense to encourage China not to oppose the president's missile defense system. Is this a good idea to work with the Chinese on this, to bring them in, if you will, to get their support?

DORGAN: Well, they went further than that. They talked about not really being concerned about an offensive nuclear weapons buildup in China. They said it's going to happen anyway, so we won't object to it. And also the potential of maybe resuming underground nuclear testing. I think it's absurd. I mean, it's a huge step back.

We have worked -- you know, they want to abandon the ABM Treaty. We've worked for missile reductions and nuclear arms reductions. I just think this is moving in the wrong direction.

We ought to try to continue to put pressure on the Chinese and others not to have offensive weapons buildups. Our entire approach ought to be to reduce the nuclear threat, not increase it.

BLITZER: Senator McConnell, you're the chairman of the Foreign Operations Subcommittee of the Appropriations Committee. You were the chairman; you're the ranking Republican right now. Is this a good idea what the administration has in mind in dealing with China?

MCCONNELL: Absolutely. Going back to Ronald Reagan, we have always made the point that missile defense is something that shouldn't threaten even potential adversaries. It's an idea that proposes a safer world. And, of course, you can continue to have offensive weapon builddown, as we are doing unilaterally in this country and as the Russians are doing.

So, I think it's absolutely the right thing to do. Missile defense should not threaten, certainly, friends, like the Chinese are most of the time.

BLITZER: On another issue, Senator McConnell, that's in the news right now, the stalemate, the violence in the Middle East. I know you've been interested in this subject for many years. The U.S., as you know, provides a lot of economic and military assistance to Israel, to Egypt, extensive economic assistance to the Palestinians, as well.

Have these systems programs effectively become entitlements, meaning they're going to be approved no matter what?

MCCONNELL: I hope not. I think that the Palestinians and the Egyptians, for that matter, begin to believe that foreign aid is an entitlement when it is not in any way connected to behavior.

And so, Dianne Feinstein will be joining me in offering an amendment to the Foreign Operations Bill in September when it comes up that will change the certification process the president must engage in in order to continue assistance to the PLO. Because frankly, Wolf, they have simply not at all been constructive during the last six or eight months. I think strapping bombs on the back of youngsters and sending them into pizza parlors is a clear message to the United States that we need to toughen up our approach with regard to the PLO.

BLITZER: You agree with him, Senator Dorgan?

DORGAN: I do agree with him. My heart breaks for the innocent victims who have suffered through this, and we need to try to find a way to help eliminate and reduce this violence.

Let me just go back to the China thing, simply to say this. It is not going to make it a safer world to give a green light to China to begin increased building of offensive nuclear weapons. We ought to be trying to push back, to reduce the buildup in those areas, and we certainly ought not be talking about resuming nuclear testing underground. That is a huge step backwards in my judgment.

BLITZER: You can have last word on that issue, Senator McConnell.

MCCONNELL: Well, clearly...

BLITZER: Let me frame the question specifically. Is there a contradiction between the administration not opposing a buildup of Chinese nuclear missiles and, at the same time, going ahead with a missile defense shield, which presumably would be designed to deal with those increased numbers of Chinese nuclear missiles? MCCONNELL: Look, there is nothing we could do, Wolf, to keep a country the size of China from having some kind of nuclear force. They're going to do that. There is nothing we could do to keep that from happening.

The real issue is whether or not we're going to have a missile defense system that doesn't threaten anyone, that makes this a safer world. And I think, in that context, it makes sense to discuss the matter with the Chinese, as the administration has done with the Russians.

BLITZER: Now, the president will be heading over to China later in the fall. I assume that issue will be high on the agenda.

I want to thank both of our senators for joining us. Senator Dorgan, Senator McConnell, always good to have both of you on LATE EDITION. Thank you very much.

DORGAN: Thanks, Wolf.

MCCONNELL: Thank you.

BLITZER: Up next, the mounting troubles of Congressman Gary Condit. In addition to his eroding political support, the woman who says she had an affair with the California Democrat now wants a grand jury to indict him. We'll talk about that with Jim Robinson, the attorney for Anne Marie Smith, when LATE EDITION continues.

(COMMERCIAL BREAK)

(BEGIN VIDEO CLIP)

REP. GARY CONDIT (D), CALIFORNIA: We have to question Anne Marie Smith's motives. Her motive is to sell a story to a tabloid. That's what she did.

(END VIDEO CLIP)

BLITZER: Congressman Gary Condit in the television interview, disputing the claims of Anne Marie Smith, who says she had affair with the California lawmaker.

Welcome back to LATE EDITION. Joining us now from San Francisco is Anne Marie Smith's attorney, Jim Robinson.

Mr. Robinson, welcome to LATE EDITION. Good to have you on our program.

JAMES ROBINSON, ATTORNEY FOR ANNE MARIE SMITH: Thank you.

BLITZER: And let's get right to what Congressman Condit says -- her motives. What were her motives in coming forward and revealing that she had an affair, a long-term affair, with the congressman?

ROBINSON: Well, two-fold. She is a very compassionate person. She feels deep compassion for the Levys. She's the one in this story that feels the compassion for the Levys and Chandra Levy, and although she's never met the Levys or Chandra Levy.

And the second thing is the fact that she was cornered by the tabloids. The story was coming out. It was coming out, that was the purpose for the false affidavit, et cetera. And we had to act, and we did.

BLITZER: And is she making money on this? Is there a money- making profit motive for her in what she has been saying and doing?

ROBINSON: No, Wolf. She was working a bar mitzvah last night in a catering service here in San Francisco. When I got to town, I tried to get together but she was busy until about midnight. She is working two jobs and part-time on catering. She is not a rich woman. This is ridiculous.

BLITZER: Are you saying that in addition to her job with United Airlines as a flight attendant, she also has to have another job in order to make ends meet?

ROBINSON: Well, you know, she spent the whole month of July not getting paid, dealing with the FBI situation, and in Washington, D.C., testifying to the FBI, et cetera. She lost a full month's pay. She took no money from the tabloids whatsoever. We were offered money. We were offered a lot of money, and we turned it down. And this lie that the congressman keeps putting out there that she got money from the tabloids, the tabloids have all gone on the record and said that no one paid her.

BLITZER: So what, just very briefly, what kind of job with this catering service does she have?

ROBINSON: She was scooping ice cream for children last night at a bar mitzvah.

BLITZER: All right, well, we didn't know she was doing that. A little bit of news on this program.

(LAUGHTER)

BLITZER: Let's talk a little bit about this new legal strategy you had. You revealed this past week you want a grand jury in Stanislaus County, the home county of Gary Condit, to go ahead and indict him without necessarily going through the district attorney or any other process, using and invoking a rarely used, if ever used, California law. Very briefly, walk us through that legal process.

ROBINSON: Well, first of all, it took us a long time to figure this strategy out. And basically, what it is is, in a situation like this where there are political pressures, the governor of the state, until last week, employed both Congressman Condit's children at very, very high salaries, questionable jobs. Obviously, the congressman is the congressman of Stanislaus County district. His brother is on the police force in Modesto, with a very checkered past. There is a lot of political pressure here.

And we researched, how do you get to a grand jury as an average citizen and get outside of all this political pressure? And we came up with this strategy. It is rarely used, but it's appropriate in this case, I think, and we're going forward.

The grand jury will meet on Thursday. We'll be there. The grand jury doesn't have to listen to the district attorney at all. They can actually appoint their own special prosecutor.

BLITZER: Well, you know, the district attorney in Stanislaus County, James Brazelton, was talking about your legal strategy earlier this weak. He sharply disagrees with you, as you know. Listen to what Mr. Brazelton had to say.

(BEGIN VIDEO CLIP)

JAMES BRAZELTON, STANISLAUS COUNTY DISTRICT ATTORNEY: I definitely got the feeling that they weren't familiar with the law or, if they were, that they were disregarding it and doing something that would get media attention, which it did. There is no doubt about it.

(END VIDEO CLIP)

BLITZER: He suggests you're doing this just to get media attention, that there's really no solid basis in the law to go this grand jury route.

ROBINSON: Wolf, his own words prove what we're saying. These people do not want to pursue this. Ernie Norris knows 10 times more about the law in the state of California than he does.

Ernie's been, I believe, five-time District Attorney of the Year in the state of California. Actually, he was a D.A. in Los Angeles County for 35 years, specifically in homicide prosecutions.

Mr. Brazelton, as the district attorney, essentially is in the command structure above Gary Condit's brother in the Modesto police force. He wanted us to go to the Modesto police force. That's ridiculous.

BLITZER: Well, you know, there's separate investigations going on here in the District of Columbia -- the D.C. Police, FBI is involved, the Justice Department, U.S. attorney is looking into this entire matter. Why aren't they capable of pursuing this legal process without having a second tract going under way before grand a jury in California?

ROBINSON: Because nothing is going on, Wolf. There has been no grand jury. If there was grand jury looking at this evidence, it would have been leaked already in Washington, D.C., although it's a secret process. If they would have been bringing witnesses in, it would have come out by now.

There is split jurisdiction here. There are a lot of illegal acts committed in California. California does have absolute jurisdiction on some of these things, as does Washington, D.C. But in California, we can go to the grand jury. In D.C., we can't.

BLITZER: All right, Mr. Robinson, stand by. We have to take a quick break.

For our international viewers, World News is next.

For our North American audience, stay tuned for the next hour of LATE EDITION. We'll continue our conversation about Congressman Gary Condit's troubles with the attorney Jim Robinson.

Also, we'll get legal and political perspective on the case from former Clinton special counsel Lanny Davis and former Bush attorney general Dick Thornburgh.

Plus, our LATE EDITION roundtable and Bruce Morton's "Last Word." It's all ahead in the next hour of LATE EDITION.

(COMMERCIAL BREAK)

BLITZER: This is the second hour of LATE EDITION, the last word in Sunday talk.

(BEGIN VIDEO CLIP)

CHAD CONDIT, GARY CONDIT'S SON: I'd like to see him run because he's done such a great job. But the other side of me sees what the past four months has done to him.

(END VIDEO CLIP)

BLITZER: Congressman Gary Condit's aides vow to support his next political move. But what should that be? We'll discuss Condit's legal and political future with Jim Robinson, attorney for Anne Marie Smith; former Clinton special counsel Lanny Davis; and former Bush attorney general Dick Thornburgh.

Plus, our LATE EDITION roundtable: Steve Roberts, Susan Page and Christopher Caldwell.

And Bruce Morton asks, what's in a name? His "Last Word" on new labels for political parties.

Welcome back. We'll get back to our discussion about Congressman Gary Condit in just a moment, but first, here's CNNs Donna Kelley in Atlanta for a check of the hour's top stories.

(NEWSBREAK)

BLITZER: And now back to our conversation with Jim Robinson. He's the attorney for Anne Marie Smith. We're also joined by former Clinton special counsel Lanny Davis and Dick Thornburgh, who served as attorney general under the first President Bush.

Gentlemen, always good to have all of you on our program.

And, Dick Thornburgh, let me begin with you. You heard Jim Robinson make the case for this new procedure, going before a grand jury without the district attorney even participating in Stanislaus County out in California. Is there a legal basis, you think, for doing this?

RICHARD THORNBURGH, FORMER BUSH ATTORNEY GENERAL: Let me say first, Wolf, that I'm not at all familiar with the law of California. But I've had considerable experiences as a federal prosecutor, and we would on a number of occasions have citizens or citizens and their lawyers, often very good lawyers, making a good faith presentation to us about some criminal action that had taken place.

But the responsibility for initiating an investigation or going before a grand jury always traditionally rests with the prosecutor. So I think in the normal situation, Mr. Robinson would be confined to that avenue to seek any criminal charges against Congressman Condit. But he may be able to tell me differently about what the procedure is in California.

BLITZER: And we'll get Lanny Davis involved in this in a moment.

What about that, Jim Robinson?

ROBINSON: Well, California does have a unique law, Wolf. Every grand jury has a citizen complaint committee, which is, the committee is chaired by the foreman of the grand jury, and there are sometimes two to four other members. It's set up for exactly this situation -- when there's a politically charged situation, when we don't know if the district attorney will go.

You know, 80 percent in your own poll last week, 80 percent in CNN poll, said that they already believe that Congressman Condit was already guilty of obstruction of justice. That is far above the threshold to hand down an indictment. And nothing is going on.

BLITZER: Lanny Davis, you're an attorney, you know the law. What do you think about this procedure?

LANNY DAVIS, FORMER CLINTON WHITE HOUSE SPECIAL COUNSEL: Well, first of all, as I've said from the very beginning, I've never understood what the Anne Marie Smith incident, if there were incidents, has to do with Chandra Levy's investigation. And if Mr. Robinson is suggesting that there's a connection between asking a woman that you've had an affair with to lie under oath in an affidavit where there is no case that's been filed -- between that incident and a missing person case, I've never heard that connection being made.

ROBINSON: I'd love to explain it.

DAVIS: And I have focused on Mr. Condit's failure to cooperate with the police from day one by volunteering the information about his relationship. That was his central fault. Whether he had affairs with other people or even asked other people to lie about those affairs so that his wife or his family wouldn't know about it, is not relevant to me, as far as I'm concerned.

BLITZER: Well, before we let Mr. Robinson respond, let's hear directly from Anne Marie Smith in an interview on Good Morning America earlier this week. This is what she told Diane Sawyer, and I'll put it up on the screen. BLITZER: I'll read it: "He asked me to lie," referring to Congressman Condit, "and if I hadn't had an attorney, I would have perjured myself. I mean, I wasn't aware of the law, and I wanted to keep my name out of the media. And I would have marched right over there and signed that affidavit."

Jim Robinson, what is, though, the connection, the specific connection that Lanny Davis raises, between whatever she's alleging and the disappearance of Chandra Levy?

ROBINSON: Well, as you know, Anne was in Condit's apartment many, many times. And on several occasions, she saw physical evidence of another woman having been there with the description of Chandra Levy. Specifically, in both -- there are two bathrooms in his apartment. In both bathrooms there were long brown hairs that now apparently are the same length as Chandra Levy's hair. There were her bathroom products, there were other things that we turned over as evidence to the FBI.

That was probable cause for a search warrant of his apartment when he was denying the affair to the police. That's the connection, that's the nexus to why he wanted her to say that there was no relationship, that she had never been in his apartment, she didn't know anything.

BLITZER: All right.

Lanny Davis, are you convinced now?

DAVIS: He didn't answer the question at all. In fact, the evidence that led to the search warrant, if there was one, was he volunteered to allow the police to come in.

ROBINSON: After my client came forward.

DAVIS: And in fact -- Mr. Robinson, let me finish.

And, in fact, while I don't defend what he asked Ms. Smith to do, the question I have posed, which hasn't been answered, is, what does Anne Marie Smith's affair have to do with helping to find Chandra Levy? We already know that he admitted to having the relationship with Chandra Levy. We don't need Ms. Smiths's testimony to evidence that. What possible connection is there to the disappearance of Chandra Levy, other than that he was trying to hide an affair with another woman, which I don't believe is a sufficient nexus?

ROBINSON: That's exactly the point. He was trying to shut up a material witness in this case and trying to stop her from coming forward so she could give evidence for that search warrant. And that's why he asked her to lie. And that's obstruction of justice, that's suborning perjury, and that's our case in California.

DAVIS: That's quite a stretch, Mr. Robinson, and if you don't consider that to be a stretch -- and I'm a critic of Mr. Condit's. A lot of legal observers would say that you are stretching to exploit a situation that really shouldn't be exploited. And when you associate yourself with Larry Klayman, you suggest that you have political motivations in what you're doing.

BLITZER: All right. We're going to get to that in a moment. Stand by, Mr. Robinson, for a second. I want to bring Dick Thornburgh back into this conversation.

Resolve this dispute between Lanny Davis and Jim Robinson.

(LAUGHTER)

THORNBURGH: I'd love to be able to resolve it, but I have a question of my own, as you may not be surprised.

I'd like to ask Mr. Robinson, is my understanding correct, that the affidavit forwarded to your client indicated that it was a draft and invited her to make any changes in it that she felt were necessary to make it accurate?

ROBINSON: There are two things I'd like to talk about. Number one, Don Thornton, who sent that to me, admitted the day before that he knew that the story in the Star was correct. He then sent that affidavit, which is the black-and-white opposite of it.

Number one, her name is misspelled. I just got some more correspondence from Mr. Condit's attorneys last week. Her name is still misspelled.

BLITZER: Well, what about the question whether it was a draft or it was a hard-and-fast final version?

ROBINSON: You mean, sure, could I change her name? But I wasn't -- this affidavit said there was no affair whatsoever, no way no how. And there was, and he knew it.

But here's the most important thing, Wolf, to keep in mind, is the fact that, after I rejected it, Congressman Condit contacted my client at least three different times and asked her to sign it without any changes. And that's the point, that's the point. These guys are trying to confuse the issue, and that's the issue.

BLITZER: How about that?

DAVIS: We're not trying to confuse -- Mr. Robinson, we're not trying to confuse any issue. You are focusing on an affair that your client had with Mr. Condit. Mr. Thornburgh and I have been on every week criticizing Mr. Condit's failure to help that investigation from day one. And we think -- I think, I won't say for Mr. Thornburgh -- that your exploitation of this issue is unfortunate, especially because, to my mind, you're making a stretch that her testimony is necessary to establish an affair with Ms. Levy, when in fact that's already been established by the police.

BLITZER: Go ahead, Mr. Robinson. Do you want to respond to that?

ROBINSON: I think I already have. BLITZER: Well, let's ask Dick Thornburgh, then, to move on and talk about the relationship that Mr. Robinson has with what Lanny Davis brought up -- the Judicial Watch, Larry Klayman, a group that was of course in the forefront in a lot of these legal fights against Bill Clinton during the impeachment, the Monica Lewinsky process.

What does that say, if anything, about the entire initiative to get a grand jury convened and moving in California to try to work against Congressman Condit?

THORNBURGH: Oh, I'm not sure what it says. Larry Klayman's an accomplished lawyer. He, like most of us, he wins some and he loses some.

But clearly he has been affiliated with Mr. Robinson to try to raise this rather unique argument that there is an access to the grand jury available to ordinary citizens without the intervention of the prosecutor's office. As I indicated, I am not familiar with that in California. I certainly know it doesn't obtain in normal practice in criminal law elsewhere.

But I wouldn't read too much into who the lawyers are.

BLITZER: As you know, Mr. Robinson, some have criticized you and your effort for using Judicial Watch and sort of politicizing or tainting your case. You have heard that criticism. What's your response to that?

ROBINSON: I've never met Larry Klayman. I have talked to a lot of public interest law groups on this case, trying to figure out how to push this forward, how to get it in front of a grand jury, how to get Don Thornton to get him and squeeze him and tell him what he knows.

Anybody who has ever seen a cop story or a cop show on TV knows how this is done.

We've got Don Thornton dead to rights on suborning perjury. He's the one who sent to it me. I believe we have the congressman on the same issue.

Let's get this before a grand jury. Let's try to squeeze him and find out what they really do know about Chandra Levy and move it up the scale.

BLITZER: All right. We're going to take a quick break.

Don Thornton, of course, was one of the private investigators who was hired by Gary Condit's former attorney out in California.

We'll continue this conversation. We'll also be having your phone calls for Jim Robinson, Lanny Davis, Dick Thornburgh. LATE EDITION will be right back.

(COMMERCIAL BREAK) BLITZER: Welcome back. We're talking about the legal and political trouble facing Congressman Gary Condit with attorney Jim Robinson, he represents flight attendant Anne Marie Smith; Clinton special counsel Lanny Davis; and former Bush Attorney General Dick Thornburgh. I should say, former Clinton special counsel Lanny Davis.

Let's take a caller from Connecticut. Please go ahead with your question.

CALLER: Yes, Lanny...

DAVIS: Yes.

CALLER: ... don't you feel that all of the turncoat Democrats that are speaking out against Gary Condit are holding a grudge against him because of the misinterpreted clip that the stations have been showing with which Gary Condit was trying to convey a message about the sorry part and not, underline not, against President Clinton? And don't you think the Democrats ought to reexamine that clip so they get it right, and another good man is not taken down before it's too late?

DAVIS: Goodness gracious.

First of all, I'm a loyal Democrat, and I don't regard this as a party issue, whether this is a Republican or a Democrat. There is no denying that Gary Condit from day one didn't tell the police about this relationship. And his failure to do so from day one -- and I mean volunteering the relationship -- impeded an investigation of a missing person, even by one hour. So this is not a party issue.

I wish that there were more Republicans and Democrats viewing this as a human issue. Gary Condit as a human being has an obligation to go to the Levys and do whatever they ask him to do, including taking an FBI lie detector test. He hasn't done that.

So, no, this is not a party issue. It has nothing to do with what Gary Condit did or did not do on impeachment. And he did vote against all the articles of impeachment, by the way. That has nothing to do with anything.

BLITZER: Dick Thornburgh, do you agree with Lanny that this is really not a political issue but this is something else?

THORNBURGH: Well, I would say this: I think Gary Condit's current problems are more serious in the political realm than they are in the legal realm. He faces suggestions that the Ethics Committee take up his situation as reflecting poorly on the Congress. He faces suggestions that his seat may not be available through the reapportionment process, should he choose to run again. And he faces an aroused electorate at home. There are an awful lot of people who voted for him in what used to be known as "Condit Country" who now are bent upon seeing him turned out of office.

All of those, it seems to me, are much more serious to his survival than the legal matters. There's not a shred of evidence that associates him with the disappearance of Chandra Levy. And as I indicated, some skepticism about Mr. Robinson's claims of being able to go before the grand jury.

BLITZER: Jim Robinson, as you know, the attorney for Gary Condit, Abbe Lowell, was on television last Sunday, denying that he had made any suggestions to your client, Anne Marie Smith, that she lie about nature of whatever relationship they might have had.

And Chad Condit was on Larry King Live earlier this week, also making a similar denial. I want you to listen to what Chad Condit, the son of Gary Condit, had to say.

(BEGIN VIDEO CLIP)

C. CONDIT: He had nothing to do with the disappearance, so how could he ask Marie Anne Smith, or whatever her name is, to lie to the police about this? He had nothing to do about it. He had nothing to ask hour to lie about.

(END VIDEO CLIP)

BLITZER: In terms of the evidence that you have that Gary Condit directly asked Anne Marie Smith to lie, is there a tape recording or is there any contemporaneous evidence to back up her claim?

ROBINSON: Well, there certainly are phone records, and the congressman is free to go before the grand jury and deny her claim. Of course, he'd have to waive his Fifth Amendment rights, and that would be very telling. He can't answer questions the way did with Connie Chung in front of a grand jury.

BLITZER: But there's no actual recording of his voice uttering those records, "Go ahead and sign that affidavit"?

ROBINSON: No. She didn't record anything. She made notes in her diary regarding it as to the dates and times and where he said he was making phone calls from.

BLITZER: Well, Dick Thornburgh, so, if there's a case of -- there's phone records that they spoke on the phone but there's no evidence of what was said, her word against his word, what happens in a situation like that in an obstruction of justice potential case?

THORNBURGH: He said, she said. It's the old story, but my skepticism is based more on getting this before a grand jury. There's no ability in most situations for citizens to walk in and commandeer the grand jury for their own purposes, and that's really what's being sought here.

BLITZER: All right. We're going to take another quick break. I want to thank Jim Robinson for joining us.

Thank you very much, Mr. Robinson.

ROBINSON: Thank you.

BLITZER: And we'll have you back on another occasion. And we want to take this quick break. When we return, though, more phone calls for Lanny Davis and Dick Thornburgh. LATE EDITION will continue right after this.

(COMMERCIAL BREAK)

BLITZER: Welcome back. We're continuing our discussion and taking your phone calls about Congressman Gary Condit with former Clinton special counsel Lanny Davis and former Bush Attorney General Dick Thornburgh.

You know, Lanny, earlier this week the D.C. Police Chief Charles Ramsey discussed how he got information during those various meetings the D.C. police had with Congressman Condit. He was asked about it. Listen to what Chief Ramsey had to say.

(BEGIN VIDEO CLIP)

CHIEF CHARLES RAMSEY, WASHINGTON, D.C. POLICE: He'll tell you what you want to hear if you ask it properly. So it's kind of strange to describe. He does answer all your questions, but if you don't ask the exact question in the right away then perhaps you need to go back and interview again.

(END VIDEO CLIP)

BLITZER: Lanny Davis, isn't that the advice that everybody gets who has a defense attorney -- don't volunteer anything, just answer the specific questions you're asked?

DAVIS: Well, first of all, it's a very embarrassing admission by the chief, and that embarrassing admission is that he didn't ask the direct question, did you have an affair, a sexual relationship with Chandra Levy? Obviously Mr. Condit says, I answered every question they asked me. Well, they never asked him that one until the third interview.

Secondly, in missing person cases, the National Center for Missing and Exploited Children, advises parents who have abducted children, the first thing they should do when they call police is go down to police headquarters, volunteer everything they know and take a lie detector test administered by the police, because they're the first suspects. And parents who are looking for missing children are advised to get themselves out of suspicion and to cooperate immediately. Mr. Condit didn't do that.

Now a criminal defense lawyer who thinks a client may be guilty of something will tell them not to do that. A parent with a missing child wants to do that. My question remains -- and I've continued to presume this man is innocent as is his right -- Mr. Condit, why won't you do that tomorrow morning if you're an innocent man?

BLITZER: Dick Thornburgh, what about that?

THORNBURGH: Well, the real tragedy here, Wolf, is that we'll never know how this investigation might have proceeded if Congressman Condit had been forthcoming from the outset with a detailed description of his relationship with Chandra Levy; or the police had been assiduous in following up those leads, not four months later, but in the immediate aftermath of her disappearance. And because we'll never know, it leaves a cloud over all the people involved, and it's a very sad and tragic situation.

BLITZER: One other thing that came out this past week, Lanny, was that some of the staff members who have been working for Congressman Condit, some of them for many, many years, were on Larry King Live. You may have seen the program.

Mike Dayton, one of those staff members, said something that I thought was very revealing, perhaps even a little bit shocking: that he never really confronted the congressman with some of these allegations. Listen to what Mike Dayton, Lanny, had to say.

(BEGIN VIDEO CLIP)

MIKE DAYTON, CONDIT AIDE: No, I've never asked him that. I don't know, I don't feel comfortable about that. If that's something he wants to share with me, he will. But no, I've never asked him. And you know what? I don't think I ever will.

(END VIDEO CLIP)

BLITZER: And Mike Dayton also said, Lanny, that on his own he simply told the news media there was no relationship whatsoever with Chandra Levy, never bothered to check with his boss.

DAVIS: Look, I have sympathy with those staff members, and they're loyal people to their boss. But what I'm disappointed about is that Larry King never asked the obvious follow-up question: You were quoted as saying that you had talked to Congressman Condit and denied a sexual relationship, is that true? And the second follow-up question that I never heard in that interview, unless I'm mistaken, is, after they heard you say that, why didn't Congressman Condit call you and tell you that it wasn't true?

Now, I do appreciate that Congressman Condit was trying to hide an affair and that he was allowing his staff members to basically say something that he knew wasn't true. I've had some experience with that situation. But in that situation with President Clinton, there was no missing person. President Clinton was trying to hide a relationship that he was embarrassed about, as was Gary Condit. I can understand that. I don't defend it, but I can understand it.

But in a missing person case, there is no excuse to not only not tell the truth but to allow your staff members to lie, which further impedes an investigation to find the missing person.

BLITZER: And Dick Thornburgh, as you know, all those stories came out in the early weeks of this investigation, quoting Mike Dayton, Mike Lynch -- another aide for Congressman Condit -- by name, saying they did discuss this with the congressman and there's no relationship whatsoever with Chandra Levy beyond a friendship, if you will, but no kind of romantic relationship. What does that say about the congressman that he allowed this effective lie to continue?

THORNBURGH: Well, I think it says something about what our attitude is toward responsibility in this society of ours.

There seems to be an ethos developing that no one should take responsibility for any of their acts, that they should try to evade, avoid, deny. And even when it's palpably harmful to an investigation into a young woman whose whereabouts to this day remain unknown, this kind of ethos somehow seems to grow. And I think that's a larger tragedy when you look at the particulars of this case and the implications it may have in further cases.

BLITZER: Dick Thornburgh and Lanny Davis, thanks to both of you once again for joining us. And once again, thanks to Jim Robinson for joining us in our earlier segment. We, unfortunately, are all out of time.

But with President Bush and Democrats in Congress moving toward a showdown over the budget, who has the upper hand? We'll go 'round the table on that and much more with Steve Roberts, Susan Page and Christopher Caldwell. LATE EDITION will be right back.

(COMMERCIAL BREAK)

BLITZER: Time now for our LATE EDITION roundtable. Joining me, Susan Page, Washington bureau chief for USA Today; Steve Roberts, contributing editor for "U.S. News and World Report"; and Christopher Caldwell, senior writer for the Weekly Standard and a panelist on CNN's Take Five, which airs Saturday nights 8:30 p.m. Eastern. We watch it every Saturday night.

And let's begin with you, Steve. David Broder, the "Washington Post" columnist, writes in way today's "Washington Post" this, and we'll put it up on the screen: "It is good that President Bush had a long vacation at his Texas ranch because this autumn is going to be sheer hell for him. After a relatively tranquil shake-down cruise, he is about to learn how tough his job can be."

Is David Broder right?

STEVE ROBERTS, "U.S. NEWS AND WORLD REPORT": He sure is. The fact is that Bush is taking credit for the tax cut, all of those checks landing in everybody's mailboxes signed by George Bush. Fair enough, he did get it through. It was his signature issue, he deserves credit for it.

He has to take responsibility for the implications of it. And the implications of it is that there is not enough money left for a lot of things that he wants to do. It's not a matter of Democratic spending -- things he wants to do. He wants to do a drug prescription drug benefit. He wants to increase military readiness. He wants to spend money on our farmers, he wants to spend money revamping Social Security. Not enough money for all of those things. He's got to take responsibility. Democrats are right on that. Broder's right on that. BLITZER: He says Broder's right. Is Roberts right?

CHRISTOPHER CALDWELL, "THE WEEKLY STANDARD": Roberts is right.

It's tough to see where Bush has an automatic win going into the fall. He's got his faith-based initiative stalled in the Senate. He's got this education bill, which is looking like it's going to be very hard to conference. And he's got two big things -- education and defense revamping -- which the Democrats are having a great deal of success playing off against one another. I don't see where he goes automatically from here.

BLITZER: And the Democrats, the Democratic leadership in the Congress, certainly is trying to take advantage of this reduction in the projected budget surplus.

They wrote a letter, Daschle, Gephardt and company to the president earlier in the week. Among other things, they said this: "For Democrats, saving the Social Security surplus is not a symbolic goal. It is a commitment we have made to the American people and one that we thought you shared."

SUSAN PAGE, "USA TODAY": Well, you know, it's amusing that the Social Security lockbox is becoming the be all and end all in this debate, because it's really a meaningless gesture that was made in the context of a political debate when the surplus first emerged. And I guess it's a warning to candidates to be aware of easy promises because maybe you'll have to live up to them.

You know, the Democrats have a problem, too. It's certainly true that George W. Bush has difficulties as he looks to this fall, but the problem for the Democrats is, while they're criticizing the tax cut, they're unwilling to say that they want to roll back the tax cuts that have been passed into law, and they're unwilling to talk about what spending cuts they want to make.

And the president does have a natural advantage when you talk about a spending debate, because he can stand up, he's got the bully pulpit, he can make a simple message, "I'm for education and defense, let's do these two things first," which is what he said yesterday. And it's harder for the opposition party in a congressional party to make a consistent, coherent response to that.

BLITZER: And one of the problems on that, Steve, specifically on that point, is that 12 Democratic senators voted for the Bush tax cut proposals. And they're very resentful of some of the other Democrats who are saying that was a huge mistake.

For example, Senator Zell Miller, Democrat of Georgia, conservative Democrat, wrote a letter to "The Washington Post" this past week specifically attacking Terry McAuliffe, the Democratic Party chairman, for suggesting that this entire program was a huge mistake.

This is what he said: "Many people whom I respect tell me that Mr. McAuliffe is a good man. I am sure he is. But every time he speaks, it still sounds to me like fingernails across a blackboard. And he's making more and more moderates see red, the color that dominated the 2000 election map."

ROBERTS: Well, there's no doubt, there's no news that Democrats are split. You know, you've got conservative Democrats, you have liberal Democrats. I think Susan's point is right, a president always has an ability to dominate debate. Drove Republicans crazy for eight years when Bill Clinton did exactly that.

And the Democratic policy seems to consist largely saying, "I told you so," which they have a right to say, but that's not a policy. And the fact is, they're left with two other things. One is rooting for the economy to slow down in order to justify their arguments, which is not a good position to be in. And the other is to demagogue Social Security. And you can never underestimate the ability of the Democrats to demagogue Social Security. They always do it. It's their oldest issue. It's not particularly constructive either.

So this is not all on one side. Democrats have a lot to answer for too.

PAGE: I'll tell you, though. On the issue of Social Security, it's certainly true that worked for Democrats in the past. But it was interesting in the latest USA Today-CNN Gallop poll, which I know you refer to as the CNN-USA Today Gallop poll...

(LAUGHTER)

BLITZER: We do it the correct way.

(LAUGHTER)

PAGE: We saw that, even though there had been all this publicity about endangering the Social Security system, by two to one there was still support for the idea of offering private investment accounts within the system. And I was surprised, frankly, that support for that idea had remained so high. And I do think that it's possible that the politics of Social Security have changed in some fundamental way.

BLITZER: Christopher, the Democrats in the past have gotten away with demagoguing Social Security. Can they do it again this time?

CALDWELL: Well, each side has their basic point. The Democrats are using the lockbox to say the surplus is not really a surplus. The Republicans have to make the point that the Social Security trust fund is not really a trust fund.

But they seem unwilling to go on offense. Certainly Jim Nussle, the chair of the House Budget Committee, has proved to be quite a purist in terms of protecting this lockbox, and that leaves the president in a bit of a box.

ROBERTS: And the Democrats are in a box, too, Chris, because, look, I do think it's true that Bush is going to have far less maneuverability. He has backed himself to some extent into a corner with the tax bill with saying, "I'm going to protect Social Security." The money is not there for a lot of his things. Money's not there for a lot of Democratic initiatives either, and in many ways that's by design.

Jim Nussle, you mentioned is a Republican chairing the Budget Committee, said, "We did this on purpose. We used the tax cut to deprive the Democrats of effective money to spend on programs." So both parties, I think, are caught in that box.

BLITZER: Susan, we're going to take a quick break in a second, but very, very briefly, explain to our audience out there why the Democrats now say the last of the spending bills they want to deal with are education and the defense budget as opposed to the first of the issues, which, of course, is what the president wants.

PAGE: They want the defense bill to be the one that breaks the bank, the one that goes into Social Security because that's the president's initiative and proposal. And then they want to have to deal with education because they want to spend a lot more than the president does on education. They want the tough issues last so it's harder to save money on some of the Democratic priorities that would come first.

BLITZER: We'll get back to what David Broder said: This could be hell coming up here in the next few weeks.

(LAUGHTER)

BLITZER: We'll be watching.

We're going to take a quick break. More of our roundtable when LATE EDITION continues. Stay with us.

(COMMERCIAL BREAK)

BLITZER: Welcome back to our roundtable.

Steve, our good friend and colleague, Ron Brownstein, of the "Los Angeles Times" wrote something I thought was pretty interesting this past week about Al Gore, the surplus, the budget and all of this.

Listen to what he wrote: "From the moment Bush first announced this tax cut proposal in December 1999, Gore insisted that the plan would wipe out the massive surpluses projected for the coming decade and plunge the federal budget back into deficit. Can Gore renew his old arguments with Bush without sounding self-righteous?"

ROBERTS: Well, it is an interesting point, and Gore wasn't the only one. I mean, John McCain made those same arguments during the primary. And as I said earlier, I think a lot of people are saying "We told you so." The economic projections were very loose, that it was risky to put so much behind the tax cut.

But I don't know that Gore is a great messenger for this one. I continue to believe that he is not someone who is going to be able to rally a lot of Democratic troops. And he can keep saying "I told you so," but I'm not sure how many people are going to listen.

BLITZER: Are the Republicans, Chris, very nervous about the prospect of Al Gore making his rhetorical comeback anytime soon?

CALDWELL: You know, I don't really hear it talked about among Republicans. You'd think they might be.

But with very few exceptions, Republicans are much more concerned about the coherence of the Democratic message that you hear from other leaders, like Tom Daschle. If the Democrats were in a real ossified position the way they were in 1992, Gore might be able to break free and make this point. But they're all saying the same thing, so I think that the calculus favors the candidates who are in the middle of the action.

BLITZER: And, Susan, on this Labor Day weekend, we do see some interesting developments in the effort on the part of the president, the Republican administration, to make some inroads with the labor movements, specifically the teamsters, if you will.

And President Bush is you know later this week, tomorrow, is going to out and speak to some traditional labor communities. Earlier in the week, he gave a speech in Pittsburgh. Listen to the line he gave on the very sensitive issue of importing steel. Listen to this.

(BEGIN VIDEO CLIP)

BUSH: Makes sense, common sense, not to be heavily reliant upon material such as steel. If you're worried about the security of the country, and you become over reliant upon foreign sources of steel, it could easily affect the capacity of our military to be well-supplied.

(END VIDEO CLIP)

BLITZER: He sounds like someone who is with the AFL-CIO, if you will.

PAGE: Well, it is an argument he's making at odds with his general stance for free global trade.

But the president is trying in a very deliberate way to reach out to those elements of organized labor that might be friendly to him -- the teamsters, the steel workers, the machinists. You saw it, when it came to oil exploration in the Alaskan wildlife refuge, that he made some inroads in organized leaders. And that's important, because there was no interest group in America that did more to try to defeat him last year than organized labor. If he can at least split that movement, that's going to serve him well.

ROBERTS: But it's also true that about a third of labor members always vote Republican anyway. During Reagan's time, it came close to 40 percent.

But in the end, his appeal to labor is going to be the same as his appeal to the general country. And that is in one word, and that's the economy. We're now back to the economy, stupid. All of our talk about, well, is Gore going to be the spokesman? In the end, what's going to really matter to labor, what's going to matter to most voters -- are they going to be better off a year from now than they felt when George Bush came into office? The midterm elections are going to be run on the economy. Bush is betting very heavily on an economic rebound, and the Democrats are betting the other way.

CALDWELL: That's right. He's fishing where the fish are here. The labor movement now is now over half government employees. So, for them, an election is a referendum on whether you want more government spending. Bush is not going to get those votes. But this appeal to steelworkers, that is a cheap, demagogic, anti-trade point.

There are one-tenth as many steelworkers in the country now as there were 25 years ago. And yet, we are making more steel. What the teamsters are worried about is layoffs due to mechanization, not competition.

BLITZER: And the steelworkers and the machinists and the AFL- CIO.

Vicente Fox, the president of Mexico, is coming to Washington, Susan, this week. He's going to get a warm reception, I'm sure. But tell us what to expect on this whole issue of illegal immigration and the proposal to allow Mexicans to remain here as so-called guest workers.

PAGE: A lot of trouble in working out the details. Do you offer it to Mexicans and not other nationals? Do you reward people who've gotten here illegally to the disadvantage of people who have been waiting patiently legally? So, it's not clear they're going to have the big announcement they want.

But this is an important visit. You know, Vicente Fox seems to be the foreign leader with whom this president has the closest connection with. We saw that with Bill Clinton and Tony Blair, and with Ronald Reagan and Margaret Thatcher. And it's interesting that for the first time, the foreign leader who fills that role is not a European leader. That's never happened before.

BLITZER: But this notion of guest workers in the United States, doesn't that sort of run counter to the entire tradition of immigrants coming to this country and being able to become citizens and working their way up?

ROBERTS: We've always had guest workers and particularly in times of low unemployment. And for all of the economic problems we have, the unemployment is quite low, and agriculture and many other industries depend on these workers. So I don't think this is an unreasonable idea.

And there is an important domestic political dimension here. Hispanics have become the largest minority in this country; they have passed African-Americans. Bush got about a third of the Hispanic vote in the last election. He knows -- a Republican pollster said to him the other day, if the Republican Party is the party of white America, we lose.

He's not going to get many African-American votes. He has got to make bigger inroads in the Hispanic vote. And, as one White House guy told me, one Republican told me, the White House wakes up every single day trying to figure out how they can appeal to the Hispanic vote.

BLITZER: All right. Steve Roberts, Christopher Caldwell, Susan Page, thanks for joining us. Always good to have you on our roundtable, see you next week.

And up next, Bruce Morton's "Last Word."

(BEGIN VIDEO CLIP)

BRUCE MORTON, CNN CORRESPONDENT (voice-over): Fifty years ago, maybe, a liberal might have been someone like the late Hubert Humphrey, who thought government programs could solve social problems such as poverty. No one thinks that anymore.

(END VIDEO CLIP)

BLITZER: Is it time to redefine America's political labels?

(COMMERCIAL BREAK)

BLITZER: Time now for Bruce Morton's "Last Word" on rethinking our political labels.

(BEGIN VIDEOTAPE)

MORTON: American politics needs some new labels. Not so much for the party names -- who knows what Republican and Democrat mean anyway? -- but to replace the ideological labels "liberal" and "conservative," which clearly don't mean anything anymore.

Start with "conservative." The Random House edition of Webster's College Dictionary -- the one I have was published in 1997 -- says "conservative" means "disposed to preserve existing conditions, institutions, et cetera, or to restore traditional ones and to limit change." Huh?

Remember Newt Gingrich and Tom DeLay, who came to Washington saying, we want to abolish four or five Cabinet departments and some other agencies, we want to get rid of the income tax and so on? Conservative? Not by the dictionary definition.

The second definition is "cautiously moderate." But these guys weren't moderate. In fact, the big war among House Republicans nowadays is the conservative majority getting mad at the 20 or so moderates who are not towing the conservative line.

The third definition is "traditional in style or manner, avoiding novelty or showiness." These guys? Rush Limbaugh? Hard to imagine.

Now "liberal." When the Republicans say it, they spit the word out so that it sounds like a synonym for "child molester."

UNIDENTIFIED MALE: The liberals.

BOB DOLE, FORMER REPUBLICAN CANDIDATE FOR PRESIDENT: Big- spending liberals. GEORGE H.W. BUSH, FORMER PRESIDENT OF THE UNITED STATES: Old '60s liberals.

MORTON: The dictionary says, "favorable to progress or reform." But DeLay would say he's the reformer -- get rid of the Department of Education, change the tax system and so on. Call him a "liberal" of course, and he'd probably hit you.

Second definition: "designing or pertaining to a political party advocating measures of progressive political reform." Again, DeLay and his fellow Republicans would say that's what they do.

Third definition: "having views or policies advocating individual freedom of action and expression." But again, the Republicans say, we're the ones who want to get government off your backs, give you more freedom, not those awful liberals.

So it's confusing. 50 years ago, maybe, a liberal might have been someone like the late Hubert Humphrey, who thought government programs could solve social problems such as poverty. No one thinks that anymore, though some see a larger role for government than others in trying to solve these problems.

Most Americans are centrists. Most winning politicians, like Bill Clinton, are seen as centrists. But these other labels? Most Americans probably want to preserve our institutions -- the dictionary says that's conservative -- and favor progress, though the dictionary says that's liberal.

We need new labels: hoot owls, horny toads, blue dogs, whatever. Any thoughts?

I'm Bruce Morton.

(END VIDEOTAPE)

BLITZER: Thanks, Bruce.

Now it's time for you to have the "Last Word." Many viewers wrote to us about our discussion last week about Congressman Gary Condit.

Reg in Sedona, Arizona, wrote this: "The Democrats on the House Ethics Committee should have the ethical responsibility to work for Condit's resignation, and this is coming on very, very slowly. What hypocrisy."

But Joan from Riverside, California, sees it differently: "No, Gary Condit should not resign until it is proven that he's guilty of something other than having a sexual relationship with another consenting adult."

Finally, a follow-up to our interview last week with the Reverend Al Sharpton, who's considering a run for president in 2004. During the interview, we attributed a quote about Sharpton's prospects that ran in the Raleigh News and Observer to Senator John Edwards, who's also considering a presidential run. But the senator's office later called us to point out that it was Sharpton, and not Senator Edwards, who made those comments. Thanks for correcting us.

As always, we welcome your comments and corrections. You can e- mail us at LATEEDITION@CNN.com. And don't forget to sign up for my weekly e-mail previewing our program at CNN.com/email.

Just ahead, we'll show you what's on the cover of this week's major news magazines.

(COMMERCIAL BREAK)

BLITZER: And now a look at what's on the cover of this week's major news magazines.

"TIME" magazine asks: "Where have you gone, Colin Powell? The secretary of state," it says, "isn't the foreign policy general everyone thought he'd be. What's holding him back," on the cover.

"Newsweek" takes a look at Mormons, which it calls "A changing but still mysterious religion that's getting ready for its Olympic closeup" on the cover.

And on the cover of "U.S. News and World Report": "Crisis in the ER: Turnaways and huge delays are a sure-fire recipe for disaster, and what you can do about it."

And that's your LATE EDITION for Sunday, September 2. Please join us again next Sunday and every Sunday at noon Eastern for the last word in Sunday talk.

And if you missed any of today's show, you can tune in tonight, 7:00 p.m. Eastern, for our one-hour replay of LATE EDITION.

I'll see you tomorrow night at 8:00 p.m. Eastern on Wolf Blitzer Reports. Our focus, the summer of the shark, with a special interview with Peter Benchley, the author of Jaws.

Until then, thanks very much for watching. Enjoy the rest of your holiday weekend. I'm Wolf Blitzer in Washington.

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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