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CNN CAPITAL GANG

Democrats Question Timing of Ashcroft Announcement; Did the Government Unfairly Destroy Andersen?; U.S. Surprises Many at World Cup

Aired June 15, 2002 - 19:00   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, THE CAPITAL GANG.

MARK SHIELDS, HOST: Welcome to CAPITAL GANG. I'm Mark Shields, with the full CAPITAL GANG, Al Hunt, Robert Novak, Kate O'Beirne, and Margaret Carlson.

Attorney General John Ashcroft announced disturbing news from Moscow.

(BEGIN VIDEO CLIP)

JOHN ASHCROFT, ATTORNEY GENERAL: We have captured a known terrorist who was exploring a plan to build and explode a radiological dispersion device, or dirty bomb, in the United States.

A radioactive dirty bomb involves exploding a conventional bomb that not only kills victims in the immediate vicinity but also spreads radioactive material that is highly toxic to humans and can cause mass death...

(END VIDEO CLIP)

SHIELDS: In Washington, senior government officials were less ominous than the attorney general.

(BEGIN VIDEO CLIP)

PAUL WOLFOWITZ, DEPUTY DEFENSE SECRETARY: It certainly wasn't at the point of having a specific target, and it was not an actual plan. We stopped this man in the initial planning stages.

(END VIDEO CLIP)

SHIELDS: Democrats questioned the timing.

(BEGIN VIDEO CLIP)

SEN. TOM DASCHLE (D), MAJORITY LEADER: If the information was available earlier, why was it not announced? Why the attorney general had to be in Russia to make the announcement? I mean, those questions seem as if there may have been a rush to bring it to -- before the news media. (END VIDEO CLIP)

SHIELDS: Al Hunt, who, if anybody, is playing politics on this issue?

AL HUNT, CAPITAL GANG: Politics, Mark. John Ashcroft is the most blatantly political attorney general since since John Mitchell. I mean, that's just to give a -- and his agenda is John Ashcroft, not George Bush, as I think this Moscow press conference -- in Moscow, Russia, he had to hold a press conference, and then he had to hype it.

And as Robert Novak was the first to report, it infuriated the White House. Now, I -- some of them were angry, by -- according to Bob's reporting, because they thought it hurt the stock market. I don't care what it does to the stock market. I think you don't unnecessarily -- you don't hype these things. They're serious enough as it is.

Moreover, I think John Ashcroft is, is, is, is covering up a miserable record on terrorism, particularly before 9/11, and even afterwards. This was a street thug, Mark, and it doesn't mean he wasn't dangerous. But I'm not quite sure -- at least, I think you could raise the question of why on May 8 we apprehended this guy rather than then try to tail him and find out if he did have accomplices.

SHIELDS: Your name was invoked, Robert Novak.

ROBERT NOVAK, CAPITAL GANG: Well, that isn't quite my position. My position is that there was nothing wrong with arresting him on May 8, and they decided what they had -- they had to make a decision on what to do with him, and they turned him into this combatant status.

But the problem was, is that why this -- why did the -- John Ashcroft have to scare the hell out of everybody in that gloomy studio in Moscow? It looks like he was in somebody's basement there, like the world -- the end of the world was coming. It spooked the stock market, it spooked a lot of people who are not in the stock market.

And they had planned to have Paul Wolfowitz and Deputy Attorney General William Thompson make the announcement. Now, Paul Wolfowitz, if he was announcing the end of the world, would be calm about it, that's just -- that's because he's a very low-level person. And that's what they intended to do.

So there -- I -- there are thought -- I think that Attorney General Ashcroft is very nervous, with the prospect of this new Department of Homeland Security. He thinks he's going to be edged out. But he did not help his stock with that performance.

SHIELDS: Kate O'Beirne.

KATE O'BEIRNE, CAPITAL GANG: I have a safe prediction. If a dirty bomb is ever -- say -- is ever detonated here in the United States, it will be really bad for the stock market, Bob, really bad.

MARGARET CARLSON, CAPITAL GANG: Get ready.

O'BEIRNE: Not a good idea to make an announcement from Moscow, for a couple of reasons. The setting was so ominous. Of course, there's no opportunity for Q's and A's, where he might have been able to refine or, or tone down exactly how he explained it.

But in addition, once Bob Novak explained that the ominous warning, you know, affected the market, then the rest of the media wondered whether or not John Ashcroft's stock was down. Fatally so, in any important way with the administration. I'm told actually that's not so, although they would rather it not have happened out of Moscow.

But it seems to me two things about John Ashcroft. The media, we all love picking over and second-guessing, where the FBI, CIA -- any of them go wrong. This was, I think, a very impressive example of not just cooperation between the FBI and the CIA, finding this convert to Islam, who's more than a thug, who was studying bomb-making in Afghanistan in Pakistan and meeting with senior al Qaeda officials, and also shows a whole new level of cooperation with international intelligence.

So rather than talk about that, after all the mistakes we've highlighted, everybody instead would rather talk about this breakdown in communication between the White House and the FBI.

SHIELDS: Well, in response to Kate, Margaret, let me just raise one point, Porter Goss, the Republican chairman of the House Intelligence Committee, six years been studying the closest (ph) stuff, the very day, I mean, an amazing question of coincidence, the day of the Ashcroft announcement. Quote, "Should we have known, yes, about September 11 beforehand? Could we have known? Yes, I believe we could have, because the hard targets, you read the file, and you say, Why didn't we listen?"

Now, that's -- this very nicely stepped on the story, Margaret.

CARLSON: Yes. No, and when you have Goss saying this, you have to, you know, wind back and hear Mueller having admitted, about the time Coleen Rowley was testifying, that, yes, perhaps he did miss some of the signs.

The FBI and the CIA announced this week that they were going to stop leaking against each other and cooperate, as they did find this guy, who is more than a street thug, but merited probably a little less attention than John Ashcroft wanted to give him for this capture.

And Bob, you did seem to be a little more worried about the stock market than, say, just the rest of us being defeated by...

NOVAK: Well, you better be worried...

CARLSON: ... or blown up by al Qaeda.

NOVAK: You better be worried about the stock market, because it is a economic indicator that can drag down the whole economy. I think that Attorney General Ashcroft did make a mistake in talking about the loss of life that would result from the, from the dirty bomb, and I think it was not accurate -- that was not the correct analysis of it.

But while I'm criticizing Ashcroft, I think Senator Daschle was his usual political self in saying, boy, this was a political timing, when in fact the -- Senator Dick Durbin, who's also a very partisan Democrat, and probably knows more about it than Tom Daschle, said there was nothing wrong with announcing it at this time.

SHIELDS: Al Hunt, before we name any partisan Republicans -- I guess there aren't any, right?

NOVAK: Oh, I don't want to go through that again.

SHIELDS: No, but, but, Al, was Tom, was Tom Daschle excessively partisan here?

HUNT: No, I don't -- I think he raised the same question that a lot of other people were asking. This is a guy who was arrested on May 8, so why suddenly was there a need to make an announcement on what was...

NOVAK: They had to make a decision...

HUNT: Wait.

(CROSSTALK)

HUNT: ... with John Ashcroft in Moscow? I mean, it did lend a certain, a certain political tone to it, and it was, as you said, right in the context of Porter Goss and others saying that. So I think it's a perfectly...

(CROSSTALK)

O'BEIRNE: ... he was being transferred to military custody, and about which there's no disagreement on the part of anybody in the administration that this guy belongs in the brig. And you, you have to appreciate, the FBI can't win. Moussaoui wasn't scrutinized enough. Now, he was only taking flight lessons. There are actually benign reasons for taking flying lessons.

There's no benign reason for studying bomb-making in Afghanistan or Pakistan...

HUNT: (UNINTELLIGIBLE)...

O'BEIRNE: ... and yet people now think...

HUNT: They could have done it May 15, couldn't they have?

O'BEIRNE: Well, they hadn't decided yet whether or not he was going to stay in federal custody...

HUNT: But why (UNINTELLIGIBLE), why did they suddenly decide after all this...

(CROSSTALK)

NOVAK: Why is it Dick Durbin...

(CROSSTALK)

NOVAK: ... thinks it's totally appropriate, and he know, he's been following this stuff very closely?

HUNT: Why does Porter Goss think he should have known about 9/11, Bob? I mean...

(CROSSTALK)

HUNT: ... you know, maybe it's...

NOVAK: ... has nothing to do with it, (UNINTELLIGIBLE)...

HUNT: ... a coincidence. But the point -- the question that Mark asked me about, which you apparently didn't hear, was, was Tom Daschle being -- just being political? He may be wrong, I don't know that. I'm saying it's a perfectly...

NOVAK: He's always (UNINTELLIGIBLE).

HUNT: ... legitimate -- it's a perfectly legitimate -- Well, you think all Democrats are...

NOVAK: No, I didn't, I -- just...

HUNT: ... (UNINTELLIGIBLE)...

NOVAK: ... wait a minute, wait a minute...

HUNT: ... it's a perfectly legitimate question...

NOVAK: ... I just said, I just said...

HUNT: ... to ask, and that was in response to Mark's question.

NOVAK: I just said Dick Durbin was not political. I said...

HUNT: You said he was also very political...

(CROSSTALK)

NOVAK: ... let's, let's, let's...

CARLSON: You know, there is some pattern now in the White House announcements, you know, we're in peril, there's a terrorist threat. But the announcements do seem to come, like the Department of Homeland Security, when attention is being directed towards their mistakes.

SHIELDS: Last word, Margaret Carlson. THE GANG will be -- of five will be back with the Catholic bishops in Dallas. (COMMERCIAL BREAK)

SHIELDS: Welcome back.

The Roman Catholic bishops of America reached agreement on reaction to clerical sexual abuse after a day's debate.

(BEGIN VIDEO CLIP)

BISHOP WILTON D. GREGORY, PRESIDENT, CONFERENCE OF BISHOPS: Today we have seen the passage of an important document in the history of our conference of bishops. Form this day forward, no one known to have sexually abused a child will work in the Catholic Church in the United States.

CARDINAL ANTHONY BEVILACQUA, ARCHDIOCESE OF PHILADELPHIA: Not in any way thinking less of our priests, but we have to think of the priority. And by the common good of the church, I mean the victims, the protection of children and young people, the moral authority of the church, the avoidance of scandal...

(END VIDEO CLIP)

SHIELDS: Kate O'Bierne in Dallas, did the bishops meet the enormous challenge?

O'BIERNE: Mark, I confess that I think they have created a new problem for themselves and failed to address the root causes of the current scandal.

If you had asked me a week ago, had I been here to enlighten you, I would have said that if everyone who goes into that meeting a bishop emerges a bishop, it'll be a failure.

I think that the one-size-fits-all policy that doesn't permit any discretion on the part of bishops, after all, two thirds of them have had responsible policies in effect, they have not had these kinds of problems. I think it's going to possibly sacrifice innocent priests. They're now going to be guilty until proven innocent.

But because they're unwilling to encourage the resignation of irresponsible, derelict bishops, nobody trusts any bishops now to use any discretion, and I think, as I said, that could lead to a real injustice.

And this is not a homosexual -- heterosexual abuse problem, this is a homosexual problem, with homosexual priests abusing teenaged boys. But for too many bishops, the fires of hell hold nothing to the wrath of "The New York Times," and so too many of them are unwilling to address a root cause that will prevent future abuse.

SHIELDS: Margaret Carlson?

CARLSON: They came out with a good policy for punishing the priests. I think taking -- removing them from the ministry but not defrocking them is, is, is the right approach. But given that they did not punish the bishops, I think it was a failure, because it was -- the, the priests have -- were, you know, weak sinners. The bishops were, you know, clinging to power and covering up and overly PR-savvy.

And they have to be punished in some way, because that seems to me the cruelest part of this whole scandal, is that it wasn't a victimless crime. The bishops protected adults that they knew at the expense of the children they didn't know.

And the meeting in Dallas took away, you know, all the sort of mystique of the Catholic Church. They were applauding each other like conventioneers, and they were media savvy. And it just -- it, it, it was -- it's like sausage. You don't want to see church policy being made.

SHIELDS: Bob Novak?

NOVAK: I don't, I don't think it was that bad, I really don't. I think it was a -- I think Kate is quite correct on the question of the bishops got off scot free, that is a real problem. But I don't think it was wrong to establish these positions that they took, they had to take if they had -- Margaret, if they hadn't taken them, if they'd have just said, if they hadn't had these -- this discussion, if they had it behind closed doors, then everybody would really be on them.

The point of the matter is that we had Archbishop Flynn of St. Paul-Minneapolis on, who was the chairman of a sexual abuse committee, we had him on "NOVAK, HUNT, AND SHIELDS," Mark and I interviewed him. And again, I asked him about this question of the, the homosexual subculture in the, in the church, which a lot of people believe is the root of the problem. The bishops will not address that problem. It is a hot potato.

And, and that is disappointing.

SHIELDS: It eludes me as to why, on a vow of celibacy, it makes any difference whether the person taking the vow of celibacy is a homosexual or heterosexual.

But go ahead, Al.

HUNT: Some were women who testified this week about being abused too. Look, I thought it was an extraordinary session. I think they deserve a lot of credit for some of what they did.

I think Kate is right on the, on the narrow substance of it. It may create something -- I don't think they had any choice. I think at this stage, they had to do it. We just did a poll this week, and it breaks your heart. I mean, the Catholic Church has gone from being one of the more popular institutions in America to being one of the more unpopular one. The numbers are just absolutely stunning.

And I, I do agree with everyone here, though, that until they do something about the enablers, until they do something about the bishops, that is not going to change.

And Mark, if a school principal promoted or didn't do anything about a teacher that molested a kid, we would say, That is an outrage. And the same thing is true, and Cardinal Law and others have to go before the public's going to change their view.

SHIELDS: Beyond the loss of money which is paid out for -- from coffers that are diminished, and beyond the loss -- the anger and the fury of the laity, one of the great losses is the credibility of the church. And I'll say this, that there's been no more effective advocate champion of the poor in this country for the past 50 years than the Catholic Church.

In Washington, in the states, everywhere. And I'm just fearful that the credibility of the church has been damaged, and I hope it can be repaired. I thought, I thought the bishops -- it was an extraordinary meeting to have them sit there and listen to the abusers (ph)...

NOVAK: I thought that was...

SHIELDS: ... and listen to Scott Appleby and Margaret Steinfeld (ph)...

NOVAK: ... I thought that was good.

SHIELDS: ... really give them...

(CROSSTALK)

NOVAK: We, we asked, we asked, we asked Archbishop Flynn about who takes care -- what are we going to do about Cardinal Law in Boston. And he said, "That's up to the Holy Father." I don't think that's good enough.

O'BEIRNE: Mark, they only listened to church liberals because they didn't want anybody raising this homosexual issue in front of them.

Look, there are 46,000 American priests. They have been so ill served by these derelict bishops, because all of them now are under this cloud. And I do fear that innocent priests, because they're now going to be under this new one-size-fits-all policy, guilty until proven innocent.

Referring charges to DAs is not the be-all and end-all we might want to pretend it is. Don't forget, they were responsible for some of the worst abuses with daycare scandals and everything else, great injustices.

SHIELDS: Last word, Kate O'Beirne.

Next on CAPITAL GANG, a verdict against Arthur Andersen.

(COMMERCIAL BREAK)

SHIELDS: Welcome back.

A federal jury in Houston today delivered a virtual death sentence to the Arthur Andersen accounting firm by finding it guilty of obstructing justice in the investigation of the Enron Corporation.

(BEGIN VIDEO CLIP)

C.E. ANDREWS, ANDERSEN PARTNER: We did not think we committed a crime, we still do not think we committed a crime. But the indictment itself crippled our organization.

UNIDENTIFIED WOMAN: We are going to get to the bottom of the Enron debacle, and those people who were responsible are going to be prosecuted. We're not finished with Arthur Andersen.

(END VIDEO CLIP)

SHIELDS: Bob Novak, did the Arthur Andersen evidence-shredders get what they deserved?

NOVAK: You know, this is really the most, one of the most ridiculous things I have seen. The Democrats on the Hill agree with the Republicans that it was an outrage to come after Arthur Andersen, to destroy a firm because of the shredding of the documents, when the target ought to be Enron.

And you find this, this woman who was running the task force at Justice saying, Well, we're now, we're going to go after Enron. Now we're going to go after Enron. But we're not through with Andersen. What do they mean, they're not through with them? They're just -- they have destroyed the whole firm.

The whole problem is that I believe that this was a horrible decision by the Justice Department, the same kind of lawyers you had over there under Clinton, they're still there under, under Bush. And we have the lawyers making decisions that are, that affect the life of a great corporation. God knows who's safe in this country.

SHIELDS: Al Hunt.

HUNT: Well...

SHIELDS: Where to begin, Al?

HUNT: I actually agree with about 90 percent of what he just said, which scares me half to death, Mark. I think the government should have taken the Paul Volcker's offer four-and-a-half months ago and let Volcker run that company, one of the most respected men around. The individuals could have been indicted.

The firm was wrecked even before this verdict, but...

NOVAK: The indictment wrecked it.

HUNT: ... but -- exactly. And I think (UNINTELLIGIBLE). As to whether they go after Enron, we'll see how high up it gets and we'll see what they do.

SHIELDS: Well, the little people get hurt, Kate, 7,000 people have lost their jobs already.

O'BEIRNE: Right. I do agree that they were -- this might be a death sentence, but they've been on deathwatch because their clients in the market indicted and convicted them, and they've been in such trouble.

Given the speed of the wheels of justice, I do think it's remarkable that the Justice Department, Bush Justice Department, set up a task force, indicted and convicted within six months.

And Bob, this is a predicate for Enron. They're moving on Enron and a whole lot of critics who thought they were going to be dragging their heels. I think they're going to be proven wrong given the speed of this verdict and their determination about Enron.

SHIELDS: Margaret...

CARLSON: You know, it's...

SHIELDS: ... should the attorney, the -- was an Arthur Andersen attorney that they fingered as the really guilty party here, who sent the e-mail saying, This is our policy on document retention, which is a subtle hint to destroy evidence.

CARLSON: Yes, well, and the, and the jurors didn't know whether you could -- if you didn't know who totally was responsible for it, whether you could do the corporation. The corporation seemed corrupt at the top, and like the bishops, Arthur Andersen enabled Enron to do much of what they did.

Now, it'll be a terrible shame, however, if, you know, Ken Lay gets off or gets to keep his $25 million and never serves any time, and a corporation is destroyed. But just like we say, well, those who are in favor of the death penalty as a deterrent, maybe you need to get one...

(CROSSTALK)

CARLSON: ... accounting corporation to deter others.

(CROSSTALK)

CARLSON: I mean, this whole...

HUNT: ... they got, they got rid of those guys.

(CROSSTALK)

CARLSON: ... you know, this...

HUNT: They got rid of those guys.

(CROSSTALK) CARLSON: ... the corporate world...

NOVAK: ... those guys, those guys...

CARLSON: Wait...

NOVAK: ... those guys are gotten rid of. It's not a death -- it isn't a murder, it is a death penalty...

CARLSON: No, no, but, you know...

NOVAK: ... it's somebody who shredded some documents.

CARLSON: ... the -- Listen. The unfairness...

NOVAK: It's ridiculous.

CARLSON: ... you know, we're learning about the unfairness operating in the corporate world, at ImClone, at Enron, at Arthur Andersen, at Tyco. And some of them ought to be put away.

NOVAK: Why don't you socialist? Just nationalize them all...

CARLSON: No, I mean...

NOVAK: ... then you won't have that problem.

CARLSON: ... you talk about welfare mothers, well, you know, these are...

(CROSSTALK)

NOVAK: Be like Albania.

CARLSON: ... welfare CEOs.

(CROSSTALK)

O'BEIRNE: Bob, but it is striking that the accountability in the private sector is so harsh, and look at the FBI and CIA and everybody else who's never held accountable.

CARLSON: It's so...

(CROSSTALK)

SHIELDS: ... so harsh, I'd like -- there's a different...

(CROSSTALK)

CARLSON: ... until somebody gets caught?

SHIELDS: ... poster boy every day...

CARLSON: No, look...

SHIELDS: ... I mean, let's be honest about it.

Andrew Wasserman (ph), prosecuting attorney, when you expect the police, don't destroy evidence. Pretty good advice.

We'll be back...

NOVAK: Oh, just (UNINTELLIGIBLE)...

SHIELDS: ... with a CAPITAL GANG classic, President Bill Clinton's first veto.

(COMMERCIAL BREAK)

SHIELDS: Welcome back.

George W. Bush has yet to veto a bill. But just seven years ago this week, that Bill Clinton exercised his first presidential veto, the latest of any president since Millard Filmore.

CAPITAL GANG discussed this on June 10, 1995. Our guest was Democratic Senator Dianne Feinstein of California.

(BEGIN VIDEO CLIP, June 10, 1995)

WILLIAM JEFFERSON CLINTON, PRESIDENT OF THE UNITED STATES: I cannot in good conscience sign a bill that cuts education to save pet congressional projects. That is old politics. It is wrong.

CARLSON: This is loose change. This is nothing. This is a $16.4 billion bill. And, you know, there's $200 billion eventually at risk. So all of this is -- really means very little.

NOVAK: It's a portent of things to come, and it really indicates that the president has a great deal of trouble talking about big cuts in the size of the government when he likes to keep the government programs. This is the beginning of a long, tough struggle.

SEN. DIANNE FEINSTEIN (D), CALIFORNIA: From a California perspective, it doesn't make sense. We have our earthquake money in there. There are five out of seven big projects that were still funded in it. I thought it was a pretty good bill, by and large. So I don't understand why he chose this to make his stand.

BETSY HART, SCRIPPS HOWARD NEWS: The idea of Bill Clinton says that this is going to take textbooks out of the arms of children and all this baloney is just, is just nonsense. I'll tell you why he's doing it. A couple of things. He needs to stat shoring up his liberal base and say, Hey, don't worry, guys, I'm not really a big budget-cutter...

(END VIDEO CLIP)

SHIELDS: Margaret Carlson, was it this veto seven years ago that did trigger the bitter battle between a Republican Congress and Democratic president? CARLSON: Republicans didn't need this. There were many bitter battles, and they relished every one of them. And this veto made no difference whatsoever.

SHIELDS: Bob Novak...

NOVAK: Now, listen, listen...

SHIELDS: ... you looked wonderful there, Bob.

NOVAK: This (UNINTELLIGIBLE) the directly to the close down of Congress later that year, and vetoes do concentrate the struggle. That's why the President Bush should get, should veto this, this supplemental appropriations...

CARLSON: Wait, I thought that's because...

NOVAK: ... bill...

CARLSON: ... Gingrich didn't get the right seat on Air Force One.

NOVAK: Well, that's, that's, that's the left-wing spin. This is the really (UNINTELLIGIBLE)...

CARLSON: That's the socialist spin, right?

(CROSSTALK)

SHIELDS: What's the middle-of-the-road spin, Al?

HUNT: A veto can be a very creative device. I think Clinton actually used the veto rather creatively, and the threat of a veto. So far, this president's been unwilling to do that.

SHIELDS: Kate O'Bierne...

O'BEIRNE: (UNINTELLIGIBLE)...

SHIELDS: ... time for George W. Bush to veto?

O'BEIRNE: I'm reminded that was so long ago, Bill Clinton was still claiming to have a good conscience back then. I think Bill Clinton used the veto effectively to begin defining himself (UNINTELLIGIBLE) floundering administration in contrast to the House Republicans.

SHIELDS: I'll tell you why it worked. It baited the Republicans. They went bananas, had to slow down the shutdown. Clinton vanquished Newt...

NOVAK: (UNINTELLIGIBLE)...

SHIELDS: ... say goodnight, Gingrich.

NOVAK: ... and they surrendered. SHIELDS: Say goodnight, Newt.

We'll be back with the second half of THE CAPITAL GANG. U.S. Ambassador to Japan Howard Baker is our newsmaker of the week, talking about the 30th anniversary of Watergate. Beyond the Beltway goes to Seoul, Korea, to look at World Cup soccer with CNN correspondent Tim Lister. And our Outrages of the Week, that's all after the latest news following these urgently significant messages.

(COMMERCIAL AND NEWS BREAK)

ANNOUNCER: Live from Washington, THE CAPITAL GANG.

SHIELDS: Welcome back to the second half of THE CAPITAL GANG. I'm Mark Shields with the full GANG, Al Hunt, Robert Novak, Kate O'Bierne, and Margaret Carlson.

Our newsmaker of the week is Howard Baker, U.S. ambassador to Japan.

Howard Baker, age 76, residence, Tokyo, religion, Presbyterian. Law degree from the University of Tennessee. The first Republican elected to the U.S. Senate from Tennessee by popular vote, becoming Senate majority leader. Chief of staff to President Ronald Reagan, named ambassador to Japan by President George W. Bush.

On the 30th anniversary of the Watergate break-in, Margaret Carlson earlier this week interviewed Ambassador Baker from Tokyo about his role, his historic role as vice chairman of the Senate Watergate Committee.

(BEGIN VIDEOTAPE)

CARLSON: Your question, "What did the president know and when did he know it?" all through the course of the Watergate hearings, in part because, as President Nixon's friend, you were expected to give him every benefit of the doubt. Did that question come to you in the middle of the night?

HOWARD BAKER, AMBASSADOR TO JAPAN: Well, actually it came to me early in the hearings, when it occurred to me that, you know, we were wandering all over the place in these hearings, and we're not getting to the central issue, and that is, we know pretty much what happened, but who was involved, and particularly, what did the president know about it, and at what point did he know about it?

And that's when I guess I coined that phrase at lunch one day, "What did he know and when did he know it?" And I don't know whether it's a good question or a bad one, but it apparently is the most memorable thing I've ever said.

CARLSON: What do you think of John Dean? He says he's going to reveal who Deep Throat is. Could he actually know who it is? Do you know who it is?

BAKER: Well, certainly I don't know who it is. And whether John Dean does or not, I will wait and see. I -- frankly, I doubt it. My private theory, which has not one shred of evidence to support it, is that Deep Throat wasn't a person at all, but somewhere or other there was a leak of the Oval Office tapes, and whoever was reporting, including Bob Woodward, probably was very sure of his source.

CARLSON: It was an amazing time, the way it unfolded. Statesmen like you are reluctant to call Watergate anything but a tragedy. But some others of your colleagues admit it was an exciting and dramatic moment in their careers. Wasn't it dramatic and exciting to you at the time?

BAKER: Well, it was, but it was also overwhelming. I remember when Tom Griscom, my press secretary now -- later, told me all three networks were carrying this, and PBS, and there were 80 million people watching, and I just about lost my breath.

CARLSON: During the Monica Lewinsky scandal, you grew hoarse as a commentator on this network, actually, saying, it's always the coverup that gets you in trouble. Now the Bush administration is fighting to keep a commission from looking into what the FBI administration the CIA and possibly the White House knew, and when they knew it, before 9/11. Shouldn't the president let an investigation go forward?

BAKER: I don't know what the president will do. As a general thing, the sooner you liquidate a problem, the better. And it may be that CIA or FBI sources and methods would prevent that being done. Indeed, I think had Richard Nixon made the right decision when he found out about the break-in, which he did in the middle of the night on the telephone, and had decided to liquidate it instead of trying to contain it, that he would have survived that, and he would have served out his term as president.

CARLSON: You've had a long, illustrious career. Do you have any regrets or paths not taken? I know you ran for president once, but you were cured quickly of the disease.

BAKER: No, I was never cured of the disease. When you get the disease, it comes back to haunt you from time to time. (UNINTELLIGIBLE)...

CARLSON: So can we count on you...

BAKER: ... all you -- you know what, though...

CARLSON: ... in '04?

BAKER: ... Margaret -- Oh, no. But I'll tell you what, I have no regrets. You know, I made mistakes. Maybe I would do some other things differently, but nothing major. And I'm a happy man, I'm a lucky man. I've been lucky in personal life, I've been lucky in politics, I've been lucky in business. And I hope in the hereafter, I don't have to pay up all those things. But I've really been a lucky man.

(END VIDEOTAPE) SHIELDS: Margaret Carlson, was Howard Baker gently, even diplomatically advising George W. Bush not to follow the path taken by Richard M. Nixon?

CARLSON: Yes, I think diplomatically. If he were in the White House now, I think we'd have a commission. He's the type of Republican that would pull together these people and get it done. Just remember, he went into the Reagan White House and really helped Reagan survive Iran-contra.

SHIELDS: Al Hunt, I was interested to hear him confirm, Howard Baker confirm, Morris K. Udall's great observation that the only known cure for the president virus is embalming fluid.

HUNT: No, I think that's true. Look, I'd never agree with Howard Baker that Nixon would have survived if he'd 'fessed up about the breakup, because I thought Watergate was much larger than that, the great abuses of power.

But Howard Baker is without question as admirable a public servant as I've ever covered. I consider myself lucky to have been able to cover him, and an incredibly charming, honest man.

SHIELDS: Bob Novak?

NOVAK: Well, I think Al is a notorious Baker for president supporter, if I'm not mistaken...

HUNT: No, no, I was a reporter, Bob.

NOVAK: OK...

(CROSSTALK)

NOVAK: The White House was furious with Howard -- the Nixon White House was furious with Howard Baker. They expected support and they got a fair-minded, tough investigator. Would that some Democrat had played that role in the Clinton scandals.

O'BEIRNE: I was going to make the same point. I worked for an equally charming and honest Republican senator at the time of Watergate, Senator Jim Buckley from New York, who was the first one, of course, to call on Richard Nixon to resign.

And boy, there were precious few Democrats who were willing to approach investigation of a Democratic president like Howard Baker and Jim Buckley and others were willing to approach Nixon.

SHIELDS: Bill Clinton lied, was shameless, disgraceful behavior. He did not mug the Constitution, he did not destroy the Bill of Rights. And that's what Watergate was about.

O'BEIRNE: Some of us think he mugged the Constitution.

SHIELDS: Well, you're free to think that, because it's a wonderful country, Kate, and thank Howard Baker and people like him. Next on CAPITAL GANG, Beyond the Beltway looks at America in World Cup soccer with CNN correspondent Ken Lister reporting from Seoul.

(COMMERCIAL BREAK)

SHIELDS: Welcome back.

"Beyond the Beltway" looks at the world's most popular sports event, World Cup soccer.

When co-hosts Japan and South Korea advanced to the second round, their citizens rejoiced. A million Koreans took to the streets and national leaders exulted.

(BEGIN VIDEO CLIP)

(voice of translator): The moment Japan scored, everyone cheered, and I felt tears welling up in my eyes. It's a strange feeling.

(voice of translator): You have made not only 48 million, now also 70 million Koreans are cheering now on the peninsula.

(END VIDEO CLIP)

SHIELDS: The U.S. team surprised the world with a win and a tie in its first two games, then backed into the second round after losing to Poland.

So far, President George W. Bush has said nothing, and not many Americans were watching. A CNN-"USA Today"-Gallup poll showed that 72 percent of Americans planned to watch none, nada, zip of the World Cup. That's up from 61 percent eight years ago.

Joining us now from Seoul is Tim Lister of CNN International. Thanks so much for coming in, Tim.

Tim, can you explain...

TIM LISTER, VICE PRESIDENT, CNN INTERNATIONAL: Good to be here.

SHIELDS: Thank you. Can you explain why a million Koreans are so excited about an event that arouses so little interest here in the States?

LISTER: To a great extent, it's to do with national pride. They are so happy to have the tournament here. They lobbied very hard to be able to be one of the co-hosts of this tournament. They remember the 1988 Olympics and how that put South Korea on the map. They're very keen to raise the international profile of this country.

Beyond that, though, the younger generation in particular here is incredibly enthusiastic about the game. And we actually had more than 2 million South Koreans on the streets of Seoul alone the other night watching their game against Portugal, and almost all of them were in their teens or their 20s. They are immensely enthusiastic and full of very well-behaved national pride.

I think as far as the U.S. is concerned, it doesn't help that these games are being played at 2:00 a.m. or 3:00 a.m. in the morning American time. And that's really not going to attract the fans. And I think there was so little in the way of expectations for the U.S. team to do well.

Now perhaps that they're into their last 16, and a chance, if they beat Mexico, of going all the way to the quarter finals, maybe we'll see more interest. But I did speak to one of the American players a couple of days ago. He said Americans are only interested in winners. We could come second, fourth, or eighth, and they wouldn't care. For many countries coming second, fourth, or eighth in a competition that had 197 countries enter it, would be a huge achievement.

SHIELDS: Robert Novak.

NOVAK: Tim, what's the attitude by the other -- by the people there and the fans from the other countries about the U.S. not being a -- let's face it, a power in soccer, the only world superpower, they -- do they kind of like it when the -- when Poland beats the devil out of the United States in a soccer game?

LISTER: It's quite interesting to watch how the superpowers of soccer aren't necessarily your superpowers in real life. And of course the United States comes to a competition like this as underdogs. When they take on a team like Portugal, and I went to that game, everybody expected the Portuguese, one of the finest sides in Europe, with talent that's spread all across the finest of European clubs, to really murder the Americans.

But they came out with a tremendous fighting attitude. And what's interesting about this American team is, they really work well as a cohesive outfit.

But it has to be said that superpower politics is turned on its head in the world of soccer, and you find some countries who really wouldn't play at the big table in terms of geopolitics are the powers in the land when it comes to the World Cup.

SHIELDS: Margaret Carlson.

CARLSON: Tim, I want to test my two theories for why the soccer doesn't get the viewership here that it might. One is that soccer moms don't have custody of the remote control button.

And two, that it's an egalitarian sport. You don't have some, you know, quarterback throwing long passes, you don't have a baseball pitcher kicking the dirt, and, you know, rubbing his hands and doing this. And you don't have the stars. You have everybody just kind of being equal in the game.

And women's soccer seems to attract a big enough audience. What do you think of those theories? LISTER: Certainly in soccer you have the stars. There are some huge stars here. In fact, almost every Japanese teenaged girl seems to have a poster of David Beckham, the England captain, in their bedroom. It -- you have stars from Brazil, you have stars from Argentina.

They are hugely paid, immensely important people in their own countries. David Beckham in England is regarded as a national treasure, officially. And the whole England team, they went to a reception with Prime Minister Tony Blair before they came to Japan for their game.

So there are big stars in soccer. There aren't any big stars at the moment that happen to be American.

As for the soccer mums, well, I know one soccer mum who's allowing the kids to get up at 2:00 a.m. and 3:00 a.m. in the morning to watch the game. But you're right in thinking that is where the interest is in the United States. There's a tremendous amount of interest at the grassroots level amongst the kids, the teenagers and into college.

And what the U.S. coach, Bruce Arena, laments, he says, we do so well at grassroots level, it's well organized, we get all the way through the college level, and then somehow we don't make the connect to the professional system."

Now, if the U.S. can make that connect happen, it could yet be a superpower in the world of soccer.

SHIELDS: Tim, we're -- we have just a little over two minutes. I'm turning to Kate O'Beirne.

O'BEIRNE: Tim, luck certainly frequently influences the outcome in plenty of sports. But how do you explain what almost seems like a lottery aspect to the international soccer rules that have a powerhouse like France eliminated early, and by all accounts, a weak team like the U.S., not particularly playing well, heading into final rounds?

LISTER: Well, it's very bizarre, even for those of us who've been following soccer for about 40 years. This World Cup has turned up a few surprises. And you just mentioned one of them.

But the trouble is, you know, a lot of the European players, they were playing 80 very hard, tough club games before they came out here. They had to reacclimatize. And they looked jaded, they looked tired.

A lot of the smaller teams, like South Korea, like the United States, they've had a chance to train together for months. They look fresher, they look fitter, they look more cohesive, and they are the ones who are turning on the style.

The European teams have looked a little bit sad, apart from the Swedes and the English. They've looked pretty strong. And so I think that's partly why you can explain the difference in form. But I think also, and a lot of people have mentioned this, it's becoming a more equal stage, world soccer. The smaller powers are catching up with the bigger powers. So I think soccer's changing a great deal in that respect.

SHIELDS: Final question, Al Hunt.

HUNT: Tim, let's cut to the chase. I don't care who finishes eighth or fourth or second. Who's going to win?

LISTER: I think who's going to win, Brazil. Brazil is showing tremendous form. They have so many attacking options. And I think they may well beat Germany in the final. But we shall see. I've made so many predictions, no one will insure me for any more.

SHIELDS: Thank you very much, Tim Lister. We're going to Vegas right now and get some money down on Brazil.

THE GANG will be back with the Outrages of the Week.

(COMMERCIAL BREAK)

SHIELDS: Now for the Outrage of the Week.

The day after the Bush administration relaxed U.S. regulation on 1,700 pollution-producing plants, President George W. Bush, now the nation's undisputed fund raiser in chief, went to Texas to once again shake the money tree for the GOP.

Where to? Very fittingly, to Houston, the city with the nation's unhealthiest air, whose residents are forced to breathe the country's highest recorded concentration of ozone and smog.

Who needs an environmental protection agency?

Bob Novak.

NOVAK: On May 19 last year, my friend and colleague Mark Shields said I owed Clinton staffers and American voters an apology for saying departing Democratic aides trashed the White House. Now it's Mark who owes me an apology. A 215-page report from the General Accounting Office this week reported Clinton workers defaced equipment, left behind prank messages, removed keys from computer keyboards, and put glue in desk drawers, all described by investigators as clearly intentional. Plus a few stolen items, including a $350 presidential seal.

SHIELDS: Margaret Carlson.

CARLSON: Mark, I should yield my time to you, and I happily would...

SHIELDS: I mean, prank messages? Prank messages?

CARLSON: ... by the way -- And by the way...

SHIELDS: You would have thought these people trashed the White House (UNINTELLIGIBLE). What do you mean?

CARLSON: (UNINTELLIGIBLE) always said that other White Houses have done exactly the same thing.

SHIELDS: Thank you very much, Margaret.

(CROSSTALK)

NOVAK: Listen to him squeal.

CARLSON: Karl Rove declared war on the estate tax this week. You know, the tax only 0.5 percent of Americans pay? Falsely cloaking themselves in concern for family businesses already protected, the Bush administration refused all compromise, like raising the already generous exemption to $7 million.

What will Father say to the age-old question now, What did you during the war, Daddy? Fight to destroy al Qaeda and avenge the deaths of 3,000 U.S. citizens? Or wage war to protect America's luckiest and wealthiest?

War as a metaphor when we're at war is not a good idea.

SHIELDS: Kate O'Bierne.

O'BEIRNE: This week, Pat Roush was one heartbroken mother who told the House Government Reform Committee about the kidnapping of her two daughters, age 7 and 3, from Illinois in 1986 by their Saudi father. With about 40 other U.S. citizens, the girls are trapped in that medieval kingdom and are now in arranged marriages, unable to leave Saudi Arabia without permission from a male relative.

It's an outrage that the Saudis have raised a bigger stink about our detention of their Taliban citizens than the U.S. has over the kingdom's captivity of American children.

SHIELDS: Al Hunt.

HUNT: You're right, Kate, and Germany's almost as bad, it's outrageous.

O'BEIRNE: Just as bad.

HUNT: Mark, nine United States senators in recent weeks voted, one, for the farm subsidy bill that will cost taxpayers $170 billion in the next decade, two, for permanent repeal of the estate tax, a giveaway to the very rich of some $600 billion over the following decade, and three, against increasing the debt ceiling to pay for this pork and payoff.

These lawmakers win the trifecta for fiscal recklessness.

SHIELDS: I just want to understand this. Taking the W off the keyboard and prank messages, prank messages...

(CROSSTALK) SHIELDS: ... is that, is that somehow a trashing of the White House?

CARLSON: Yes, and by the way...

NOVAK: Glue, glue, stealing property...

(CROSSTALK)

CARLSON: And they say it cost $20,000.

NOVAK: I'll say they're probably...

CARLSON: I don't think the W cost $20,000.

NOVAK: I'll send you, I'll send you...

(CROSSTALK)

HUNT: Are we equally outraged when the Bush people did that when they left office too?

SHIELDS: (UNINTELLIGIBLE) it wasn't in the report somehow.

HUNT: It was in the GAO report, wasn't it?

(CROSSTALK)

CARLSON: Yes, it (UNINTELLIGIBLE), in that, in that report...

HUNT: They said they couldn't say it was any worse.

CARLSON: ... they said that it had...

SHIELDS: It certainly was. Bob, I'll...

CARLSON: ... happened in previous...

SHIELDS: ... show you the report...

CARLSON: ... administrations.

SHIELDS: ... I'll be happy to share it with you.

This is Mark Shields saying goodnight for THE CAPITAL GANG.

If you missed any part of our show, do not despair, you can catch the replay at 11:00 p.m. Eastern and then again at 4:00 a.m. Eastern.

Coming up next, "CNN PRESENTS: THE HUNT FOR ERIC RUDOLPH."

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