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Baseball Players Consider Strike Date; President Prepares for Economic Forum

Aired August 12, 2002 - 16:00   ET

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


JOHN KING, GUEST HOST: I'm John King in Washington. Voters already anxious about the economy might soon have reason to be in an even more foul mood if baseball players set a strike date.
SUZANNE MALVEAUX, CNN WHITE HOUSE CORRESPONDENT: I'm Suzanne Malveaux in Crawford, Texas. The president is gearing up for his big economic forum tomorrow but can he counter critics who say the event will be nothing more than a partisan photo op.

JONATHAN KARL, CNN CONGRESSIONAL CORRESPONDENT: I'm Jonathan Karl in front of the White House where we were hoping to talk to Defense Secretary Donald Rumsfeld and ask him...

DARRELL HAMMOND, COMEDIAN: Are your normally kept in a jar young man? I was just INSIDE POLITICS and tell you that I'm going to give you information but I don't want to.

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

KING: Thanks for joining us. Judy is off this week.

President Bush holds a major economic forum tomorrow and one major goal is to convince the American people the economy is far stronger than the headlines might suggest but stock prices are back in negative territory. More corporations are being rocked by scandal or by bankruptcy. And if you needed more proof this summer, is as unsettling as it is hot, consider the state of the national pastime.

(BEGIN VIDEOTAPE)

(voice-over): It's one way to make a lot of voters really mad just as election day approaches: cancel the baseball playoffs and the World Series. It could happen. Baseball's millionaire players and billionaire owners haven't reached a deal. So, today, the players are talking about a strike date sometime in the next six weeks.

U.S. Air has declared bankruptcy, the biggest corporate victim of the post 9/11 slowdown in air travel. The airline says it will keep flying. Fears of a so-called double dip recession are low but creeping up.

An influential new survey of 193 business economists shows 31 percent think the odds of a double-dip recession are above 50/50. Back in March just 23 percent gave even or better odds on another recession. But the survey found 57 percent do not think Fed Chairman Alan Greenspan should cut rates when the Fed meets tomorrow.

SAM WAKSAL, FORMER CEO, IMCLONE: The past few months have been extremely challenging and emotionally draining for me.

KING: Former ImClone CEO Sam Waksal pleaded not guilty to insider trading at this arraignment today. The government says he dumped his stock before bad news about an ImClone drug sent it into the tank. Waksal's lawyer says he hopes his client won't become a corporate corruption poster child. Also fighting off the poster child label, Waksal pal Martha Stewart.

A House committee wants Stewart to talk about her sale of ImClone stock. She is refusing. Committee spokesman says if Stewart doesn't change her mind, she probably will be subpoenaed. And Stewart's main retail outlet K-mart is reportedly the subject of a grand jury investigation. The "Detroit News" reports prosecutors are looking into the company's January bankruptcy. The voters are already feeling fed up. Our latest poll shows 49 percent of Americans are dissatisfied with the way the country is going. That's way up from the 32 percent who said they were dissatisfied back in January. And today a few more reasons to be even crankier.

(END VIDEOTAPE)

(on camera): Obviously a very difficult political environment for the president and on the eve of that forum, some top Democrats are complaining Mr. Bush's forum in Waco, Texas tomorrow is merely a staged event in public relations. Keeping track of the president's preparations our White House correspondent, Suzanne Malveaux, nearby the president's ranch in Crawford, Texas -- Suzanne.

MALVEAUX: Hi, John. The president is preparing for that big economic forum tomorrow. It's a chance the administration says to really talk with those on the frontlines of the economy. They say there will be more than 250 participants, not only including the president, the vice president, half a dozen cabinet members, academics and economics as well, but also saying that they are going to be regular folks, farmers, housewives, truckers. The president is not only going to emphasize the positives of the economy, low inflation or low interest rates and economic growth but also he's going to be talking to regular Americans, those who have really been afraid of the stock market declines as well as the sluggish economy.

Now, already Democrats are criticizing the forum before it's even begun. Democratic lawmakers have not been invited to the party and they say just take a look at the invite list that many of the participants are big time Republican donors, campaign donors to the Bush administration. They say this is no more than really a public relations show right before the November congressional midterm elections. They point to the main donors, Republican donors being John Chambers of Cisco Systems, Glenn Barton of Caterpillar Inc., Charles Schwab of Charles Schwab Corporation.

Now, the Bush administration is dismissing this criticism saying at least 43 of the participants are big time Democratic campaign donors. They point to the contributors being the main ones, Franklin Raines of Fannie Mae, a former Clinton economic adviser, Penny Pritzker of Hyatt Hotels, Jerry Hood of International Brotherhood of the Teamsters and Jerry Hang of Yahoo!, a big Gore supporter. So you can see both sides trying to get ahead of this issue.

A lot of political analysts say that perhaps at least at the very least, it's a chance for the president not to make the same mistake that his father did in paying too much attention to the Gulf war, not enough attention to the economy. They say this will give them a perfect opportunity to go ahead and see that he is strong, show that he's strong. And the economy as well as the war on terror -- John.

KING: Suzanne Malveaux in Crawford, Texas, difficult political and policy environment. Thank you very much.

At the White House earlier today, I spoke with one of the major players behind the president's economic forum. On a very busy day the White House chief of staff, Andy Card, gracious enough to give us just a few minutes. And I began by asking him what Mr. Bush hopes to accomplish tomorrow.

(BEGIN VIDEOTAPE)

ANDREW CARD, WHITE HOUSE CHIEF OF STAFF: Well, this event has been planned for several weeks and we had planned to have a day where the president could spend meeting with people from different aspects of our economy. And so we've gathered a group of experts. Some are business leaders. Some are labor leaders. Some are small business proprietors. Some are small business organization leaders and this will be a good collection of people who come from all over the country, that have a perspective on our economy that is very very important for the president to hear. The president wants to see the fundamentals of our economy such that we can stand on them and grow.

We know now that our economy was strained much earlier than had been predicted. And that we entered this administration with the economy in recession. And we have tried very hard to come up with economic policies that would stimulate growth. We did that with the tax cut that applied to everyone in our economy and then we saw the shock of September 11th add another shock to our economy. And so now we want to make sure that there are sustained opportunities for growth and a restoration of confidence in markets and that the fundamentals are respected and understood to be something that we can stand on for jobs.

KING: How do you answer the Democrats who say this is a PR stunt. There's donors, contributors to the campaign there and people who support the president's policy but no critics.

CARD: Well, there are critics that will be there. There are people who are representing not political points of view but views on the economy and they're diverse. Again, there will be labor leaders there. There will be small business leaders. There will be corporate giants and there will be small and medium sized manufacturing concerns there, people representing workers. This is a good collection of a cross section of our economy and the president wants to hear from them. And the cabinet will be there in full force and we'll be there to listen to those people who have concerns that they may not feel comfortable raising to the president. As you know, John, you've heard people, I'm going to tell the president what I think and when the president walks in, they tell him what a beautiful tie he has. They are not as reserved when they meet with me and some of the other people on the cabinet.

So there will be lots of opportunity for candid dialogue and I think that this economic forum will be a good forum for the president, a great forum for our country and those who want to practice partisan politics around it will do so but I think it's unjustified because this is really a forum about our economy and jobs and finding opportunities to grow.

KING: Lastly, do you sense any possibility of new policy to come out of this or more a chance for the president to absorb and as he has in his speeches in recent weeks, sort of try to convince the American people, yes, turmoil but things aren't so bad.

CARD: Well, the fundamentals of our economy are really pretty good. And Alan Greenspan has articulated the fundamentals to Congress. We know we have very, very low interest rates. We have unemployment that is stabilizing. It's still too high, but it's about 5.9 percent. But we haven't seen a big bump in unemployment.

We know that we have to restore confidence in Wall Street and that's one reason that CEOs are now held to higher accountability and they should respond and the vast majority of CEOs are providing employment for people in our economy and that's good. But again, the fundamentals are good but there are a lot of people hurting and we want to make sure that there are opportunities for jobs and economic growth and the president will learn from what takes place at this economic forum. We may discover some new policies that we should be pursuing.

But, you know, Congress is only going to be meeting for a few weeks before they break for the election. So it's not likely that the new policy initiatives will be met with enthusiasm from Congress just before an election. The president has said that we should make the tax cuts permanent. We'll probably take a look at different ways to stimulate more activity in investing in our economy. But this is a listening and learning session for the president and also an opportunity for him to describe exactly what the benefits are of the policies that he has articulated already to the American people.

KING: Thank you very much.

(END VIDEOTAPE)

(on camera): And our thanks once more to the White House Chief of Staff Andy Card.

Now let's turn back to the threat of a baseball strike. CNN's Josie Karp is covering the player's union meeting in Chicago. Josie, how's it going? JOSIE KARP, CNN CORRESPONDENT: Well, we're waiting to find out John, for about the past three hours, the executive board of the Major League Baseball Players Association has been meeting here at the Hilton Hotel at Chicago's O'Hare Airport, and every indication that's come out the past couple days is that they are considering setting a strike date and that they will set a strike date either at the end of this month or the beginning of next month.

Players from all over the country started arriving here in Chicago this morning. They came from every part of the country. Today is a day when there are only five games on the major league baseball schedule and that's why they picked this date, August 12. But it actually has some other significance as well. Coincidentally, it was eight years ago today that the last baseball strike started. That's a strike that lasted 232 days, and ended up canceling the World Series. Although on the face of it, it looks like maybe things are going down the same path now, that the players and the owners went down then, there are players who do believe that history does not have to repeat itself.

(BEGIN VIDEOTAPE)

JOE GIRARDI, CHICAGO CUBS: I don't think it is waving a black flag. I think it is just trying to push the envelope and try to get a deal done because the players want a deal done just as bad as the fans and the owners. You know, in a lot of union negotiations there's a lot of strike deadlines set. We are not the only people that set strike dead lines. And obviously the people don't want to hear about it you know, but it might be what it takes to get the deal done.

(END VIDEOTAPE)

KARP: Negotiations between the two sides have intensified over the last month. They even met this weekend. Yesterday the owners offered a proposal on the luxury tax and the core economic issues, the luxury tax and revenue sharing that are really standing in the way right now of any agreement getting done and they are the two reasons that revenue sharing and luxury tax John that we're standing here right now talking about the fact that they're probably going to set a strike date sometime within in the next couple hours. Back to you.

KING: All right, Josie Karp at the players union meeting in Chicago. If there are significant developments with this hour, well go right back. Thank you very much.

"On The Record" next, a partisan debate about the president's economic forum and what, if anything, it can accomplish. Also ahead, a Republican point man in the political battle over the economy. Senator Bill Frist goes for a ride in our subway series.

And from the economy to the environment. Our Brooks Jackson looks at the criticism of the president's record and whether it washes with reality.

And still later, it's back to the future for Congressman J.C. Watts. We will ask the former college football player about his return to the gridiron today.

(COMMERCIAL BREAK)

KING: For more now on the economy and the president's forum tomorrow in Waco, Texas, I'm joined here in Washington by Stephen Moore. He's president of the Club for Growth; and Alice Rivlin, she was budget director under former President Clinton and a former advice chairwoman of the Federal Reserve.

Alice Rivlin, let me start with you. You think among the topics on the agenda, and it is not on the agenda for the Bush summit should be pulling back some of the Bush tax cut in this time of economic duress.

ALICE RIVLIN, FMR CLINTON BUDGET DIR.: I do. But I'm realistic enough to think it won't be there.

KING: And yet, let me stop right on that point, Stephen Moore, you think the president should be more aggressive when it comes to cutting taxes.

STEPHEN MOORE, PRES., CLUB FOR GROWTH: Yeah, I don't think now is the time to be raising taxes. I think that now is the time for Bush really to be very aggressive on capital gains tax cuts, speeding up the Bush tax cut, not canceling it because most of the Bush tax cut hasn't even taken effect yet.

KING: There was a time during the Clinton administration where a lot of people say a president really can't do much day-to-day about the economy but the tone he sets. Wall Street seemed confident, at least in the early days of the Clinton administration, in the Clinton team. Do you have that sense in the Bush team?

RIVLIN: I certainly don't have a sense of confidence in the economy at the moment. The market is tanking. Consumer confidence is down. The economy isn't doing all this badly but it's recovering more slowly than some people hoped and there certainly is not a sense of confidence. Part of that is terrorism and the uncertainty in the world. And part of it is what's going on in the economy.

MOORE: Well, that's a good point. In fact if you look at the election if 2000, 53 percent of the quote new investor class of voters, the people who own stock, took a leap of faith and voted for George W. Bush. And the question is, what has he done for the investor class? We've seen a pretty catastrophic decline in markets and what Bush has to do at this economic summit is reassure investors that he's paying attention to the economy, that there's going to be a change in the game plan and maybe even a change in personnel.

KING: Let's start with a change in personnel. I want to read you a quote in "New York Times" this morning by Senator Chuck Hagel, a Republican senator, a friend of this White House in most regards but harshly critical of the Bush team. He says he, meaning President Bush, obviously has not been very effective. People knew when they listened to Clinton that there was something behind him. There was Bob Rubin. There was an economic team. I don't think the markets see anything behind this president's words. Do you think the president should change the team? This president has said no.

MOORE: I think he needs to have a kind of Reaganite supply side or maybe someone like a Steve Forbes or a Jack Kemp come in at Treasury and reassure investors. I think that's right, that there is nobody of the stature of a Robert Rubin and Paul O'Neill just does not fill the bill. If you are losing the game, you have to change the quarterback.

KING: Are they losing the game? Should they change the team?

RIVLIN: I'm not sure changing the team would help. I think this forum, as they call it, will have one major good side. It will reassure the country that the president cares about the economy. He hasn't seemed to care very much until quite recently. But they are in a box, things were very, very good in the 90s. The stock market was over exuberant. Now we're paying the price and assuring people and just saying, well, things are going get better, may be a very difficult thing do.

MOORE: Let me just make one point about Alice said and that is that, if you go back exactly 20 years ago, summer of 1982, you had the same lousy economy under Ronald Reagan's administration and of course that was the start of the great bull market that lasted for 18 years. So Bush still has plenty of time to correct things and the market is very fickle. You know if the market is up 300 points in the next few weeks, we won't be necessarily talking about this huge financial crisis.

KING: A yes or no, we're running out of time, a yes or no. One reason for political purposes, the president thinks it's critical right now to talk tough on corporate corruption. I know from your writings you think that actually hurts the economy.

MOORE: Yeah, I think there's been too much bashing of business and regulating business and I think that's set a tone very bearish for the market.

KING: Do you agree with that?

RIVLIN: I disagree with that. I think it is very important for the president it take a very strong line. We've had corporate crime of major proportions and he's got to make sure that everybody knows the government isn't for that.

MOORE: The problem Alice is it's like to be a CEO these days, you're a criminal suspect class and I think that just hurts the economy.

KING: We need to end it there. I thank you both, Stephen Moore, Alice Rivlin, thank you very much. We continue this debate in the months ahead.

And up ahead, was the head of the Democratic party out of line in criticizing the president?

Plus, our Jon Karl hops the subway with Senator Bill Frist. But let's go now to Rhonda Schaffler at New York Stock Exchange for a market update -- Rhonda.

RHONDA SCHAFFLER, CNN FINANCIAL CORRESPONDENT: Hi there, John. We had a bit of a late session recovery on Wall Street and what was one of the quietest sessions all summer. Dow paring triple digit loses, ending 56 points lower. Nasdaq up slightly. S&P down about 5 points. Fears of a possible U.S. attack on Iraq pushing light sweet crude up to $27.80 a barrel. That is nearly a gain of $1 or 4 percent and overshadowed a major bankruptcy filing from US Airways and a case of preFed jitters, both weighing on the major indices early in the session. Investors speculating Federal Reserve policy makers tomorrow will leave interest rates unchanged and not cut as some traders had been hoping just a few sessions ago. Currently short term rates stand as 1 3/4 percent. That's around a 40-year low.

INSIDE POLITICS will be right back. Stay tuned for a visit with "Saturday Night Live's" Darrell Hammond.

(COMMERCIAL BREAK)

KING: With us now, Betsy Hart of the Scripps Howard news service and Michael Eric Dyson, a professor at the University of Pennsylvania.

Let's pick up where we left off on the subject of the president's economic forum tomorrow. I want to read to each of you a quote by the House Democratic leader Richard Gephardt. He says, quote, I am disappointed that the Bush administration has decided not to hold an honest discussion of our economic challenges and is instead staging a made for TV program where the price of admission is a campaign contribution. Michael Eric Dyson, should the president open this up? It's his event, why should he let the Democrats in?

MICHAEL ERIC DYSON, UNIV. OF PENNSYLVANIA: Well, if he's interested in nonpartisan politics that extend to the economy. The economy after all is not Democratic or Republican. It favors or disfavors good strong economic policy and why shouldn't the Democrats be involved. After all, if you're talking about the investor class being suspect as a result of corporate, you know, malfeasance, then we have to make sure that all hands are on deck and that everybody has a right to contribute to this economy. I think it is very important that the president understand that corporate capitalism and the undermining of confidence in the economy by these crooks who are CEOs is a theme that's been put forth by a whole range of people across the ideological spectrum from Ralph Nader to Al Gore. So I think that we need all hands on deck to make sure that this economic policy is rethought critically.

BETSY HART, SCRIPPS HOWARD NEWS SERVICE: Well, John, I actually wish this were just open to big contributors, which it is not, simply because that would at least give it some reason for being. Unfortunately, this whole summit is silly. At least if it were a campaign event, I suppose you could say it had some purpose. This is just a distraction.

What the president needs to be doing is getting out there with people like, believe it or not, Bob Wright, the former secretary of Labor in the Clinton administration, and saying, look, we need to put money in the hands of people's pockets right now. Otherwise, we do risk a double-dip recession. The only way to do that is through tax cuts.

The best way to do that immediately is to for instance exempt the first $15,000 of payroll taxes or of income and payroll taxes. Then after that you can talk about things like cutting the capital gains tax and other ways of encouraging the markets, getting people to spend money, getting employers to hire and so on. Messing around with a couple hundred supporters, whether the campaign contributors or not down in Texas, is just at best a waste of time and at worst, it gets us off the big message.

KING: Let me ask you this question. Give me one second here. This forum will play out to an increasingly bruising political environment, excuse me. Terry McAuliffe, the chairman of the Democratic National Committee, over the weekend very tough speech about the president and he brought into play the upcoming anniversary, one-year anniversary of September 11th.

The chairman, Terry McAuliffe saying this, quote, "all Americans trusted that President Bush would never exploit the national crisis that united us. But we watched as he used September's tragedy to explain away last August's deficit and then he cynically made 9/11 the cornerstone of the Republican 2002 election strategy." Is that a fair criticism? Michael...

DYSON: Yes, I think he's right on the money. I think right on the mark. The reality is that the president says we're going to be above partisan politics. This was a tragedy after all that impacted and affected the entire nation. So why should the Republicans now try to seek mid-term election gains by exploiting their own policies vis- a-vis -- let me finish -- 9/11.

So, I think that it's crucial that we rise above those kind of partisan politics. All of us were affected. We can't even raise questions about the legitimate knowledge that the government possessed or didn't possess. Mr. Bush wants to somehow make himself immune to just criticism I believe of what he knew and what he could have done.

HART: Michael, if this is a campaign issue, the Democrats are really scrambling. Holding America together, honoring its victims, launching a war on terrorism. This does not strike me as a way to win votes in November. And coming from the administration that really did exploit things like the Lincoln bedroom and nuclear policy and nuclear secrets to China in exchange for campaign cash. They're the masters at exploitation. This is simply holding America together. If the president weren't doing it, I think we'd have a problem. This is a way to win votes for the Democrats. Try something else, guys.

KING: I need to stop the debate right there. We will continue on another day. Betsy Hart here in Washington, Michael Eric Dyson of the University of Pennsylvania. Thank you both very much for your time.

DYSON: Thank you.

HART: Thank you.

KING: Bob Novak shares his "Inside Buzz" on the Bush economic forum -- having a tough time with that one today, up next. Also ahead, the Katherine Harris story. Why the former Florida secretary of state had to do some quick editing on her new book.

Plus, (UNINTELLIGIBLE) of sorts to expel Congressman James Traficant's hair piece.

(COMMERCIAL BREAK)

KING: Few Americans who followed the 2000 election standoff would dispute the fact that Katherine Harris was the, quote, "the center of the storm." But her new book by that name may some raise eyebrows, anyway. In the self-help-style work about leadership in times of crisis, the former Florida Secretary of State turned House candidate now has a penchant for the dramatic. Chapter titles include quote "Be Broken," "Be Bitter," or "Be Better," and the cryptic, quote, "Unstring Your Bow." A reminder of Harris' more current bout with controversy can be found in the "About the Author" page.

Galleys for the book show that references to her job as the Florida Secretary of State were changed to past tense. Harris abruptly resigned the post recently, acknowledging she had made a mistake by not stepping down earlier as soon as she qualified to run for Congress.

Bob Novak is here, now, with some "Inside Buzz."

Bob, I understand President Bush, at this forum tomorrow, is wooing a very prominent labor leader hoping he'll side more with the Republicans.

ROBERT NOVAK, "CHICAGO SUN-TIMES": Douglas McCarran, President of the Carpenters, has been wooed terrifically by the White House ever since at the Carpenters left the AFL-CIO. What a lot of Republicans don't know is that Mr. McCarran has just contributed $1 million to the Senate Democratic Campaign Committee. That's because he thinks the Senate remaining Democratic is in the interest of the Carpenters, because of the Davis-Bacon labor wage construction wages Act. That's a bad blow for the Republicans.

KING: Elizabeth Dole in the weeks ahead getting some high profile help?

NOVAK: Saturday night, Jesse Helms got out of a sick bed to appear with Elizabeth Dole. He is going to be appearing with her frequently, and there's going to be a threesome with Bob dole also appearing. Now, that's something for the Democrats that's going to be a little tough for Erskine Bowles to match. Do you think he will ask Hillary and Bill Clinton to come down? I don't think so.

KING: Wouldn't bet on that one. I, also, understand you're keeping track of a rift among Republicans who are pro-choice, pro- abortion rights.

NOVAK: Yes, Ann Stone is probably the most pro-choice Republican. She's always at the national convention losing fights on the platform. She has endorsed Priscilla Owens, Texas Supreme Court Justice, for a federal Appellate Court judge. The other two big pro- choice Republican groups have attack Ann Stone. Jennifer Stockman has attacked her. Big rift in the pro - as they say, Priscilla Owen is too anti-abortion. Big rift in the ranks of the pro-choice Republicans.

KING: One Republican who drew a great deal of attention around September 11th, Rudy Giuliani, then the mayor of New York City, will be drawing a lot more, I assume, as the anniversary approaches. You've been keeping track of what he's doing from a financial standpoint in-between, if you will?

NOVAK: Yes, he's reportedly getting a hundred thousand dollars a lecture, John, and that takes a lot of money to do that. He appears at the Murad Theater in Indianapolis in September 4th, for example. A lot of big corporations are underwriting it like Eli Lilly, but for an ordinary person to go, it costs $95 to go to this lecture. They give you a dessert and coffee. It's a cash bar, however. I think $95 is about the highest price for a lecture I can remember, but I guess it's Rudy Giuliani, so you're getting the best.

KING: You're not going to go?

NOVAK: I don't think can I afford it.

KING: Won't touch that one. Bob Novak, thanks for sharing your notebook with us, today.

President Bush's economic forum is tomorrow. It's just one facet of the Republicans election year defensive on money matters. In our "Subway Series," Jonathan Karl spoke with Senator Bill Frist about the issues driving many 2002 campaigns.

(BEGIN VIDEOTAPE)

KARL (on camera): We appreciate you taking a ride on the subway with us. You're in charge of the Senator Campaign Committee, and things - there's some real warning signs out there for Republicans. The economy is sluggish and, of course, the stock market's in, you know, somewhat of a free fall. What's the outlook?

SEN. BILL FRIST (R-TN), CHMN., NAT'L. REPUBLICAN SENATORIAL COMMITTEE: Well, it'll be interesting. I think in terms of message, in terms of issues, in terms of fund raising, in terms of candidates and candidate recruitment, we're winners, and things look good. The unpredictable things are the economy, and then, the real question is who does the economy effect? As the stock market is down, does that hurt incumbents? If so, they've got a lot more incumbents at risk than we do. If the stock market is up, does it help incumbents? Don't really know.

KARL: We spoke with Patty Murray, who, of course, runs the Democratic Senatorial Campaign Committee. She says she thinks Democrats could pick up up to 5 seats, a net gain of 5 seats, in this mid-term election. Do you think that's right?

FRIST: No, it's absolutely not right. I am cautiously optimistic. I think we will net up one seat. If you look at the candidates, you look at the money we've been able to raise, the issues that are out there, I think we'll, probably, pick up about one net seat, and that's our goal. I could say three seats ...

KARL: You're goal is to get us back to 50/50?

(CROSSTALK)

FIRST: No. A net one seat with one independent will put us in the majority.

KARL: Democrats have showed polls that say they can win in Texas. They can win in South Carolina, even North Carolina. What's the chance for you to have an upset in one of those strong Republicans states?

FRIST: Well, I think that a lot of people are focused on about six races in the country. I think, realistically, there are going to be two or three other states, outside of those six, that may well decide, on the margin, who is the in the majority next time around. A couple of states that have popped up in the last few weeks for us, clearly, in New Jersey. Three weeks ago, even four weeks ago people said, you don't have a prayer. Today, the polls show that we are about two percentage points ahead. And sure, that's a bump to the misfortunes of Senator Torricelli.

KARL: Well, let's talk about that for a second. Torricelli was severely admonished. Those are the words that the Senatorial, the Senate Ethics Committee used. I mean, how central an issue is that in that campaign, the fact he's been slapped on the wrist?

FRIST: Clearly, people, today, want full transparency. They want to know the truth. They don't want to have been lied to in any way. They don't like deception, and the fact that Senator Torricelli has been severely, severely admonished, the fact that there are a lot of records that have not been released yet, I think put him at huge disadvantage coming out of the starting gate.

KARL: Should the Ethic Committee release transcripts of those hearings. Those hearings were all held in secret. Previously, they've released transcripts.

FRIST: You know, I think that they should.

KARL: You think they should release the transcripts.

FRIST: I think that they should the transcripts, and I think that the people of New Jersey are going to demand it.

KARL: Senator Frist, there's been a lot of speculation about your political future. I mean, I've heard various speculation that somebody would run for Majority Leader of the U.S. Senate, somebody that would be the new Secretary of the Department of Homeland Security and somebody that would replace Dick Cheney on the presidential ticket in 2004. What are your plans, not to mention running for president yourself, but what are your plans and what's going on?

FRIST: I've got four more years in the United States Senate, where the I plan to be, and then, I intend to go back and do what I was doing before, and that's doing heart transplants and lung transplants and returning to medicine. All these throwing the name around is, you know, makes you feel good inside, and truth, I do want to serve the country in the very best way that I can. And I think that's being in the United States Senate. I will look at other opportunities to serve. My intentions, right now, are to be able to serve back in medicine.

KARL: I'm sure you'll tell us first.

FRIST: That's exactly right.

KARL: All right, Senator Frist, thank you very much. Appreciate it.

(END VIDEOTAPE)

KING: Checking the headlines, now. In "Campaign News Daily," Missouri Senator Jean Carnahan kicked of a multi-city campaign bus tour today in St. Louis. The four-day trip ends Thursday in Hannibal, with stops planned in a dozen cities along the way. Carnahan faces Republican Jim Talent in November.

And minor league baseball fans in Ohio can attend Wednesday's Jim Traficant Night at the Mahoning Valley Scrappers game for free, if they wear a hairpiece. The team also plans to give free admission to anyone describing himself or herself as the son of a truck driver. I guess, you'd have to be him for that. That's how Traficant liked to describe himself. The former Congressman, of course, is now serving an eight-year prison term for bribery and racketeering. The Scrappers are the Class A affiliate of the Cleveland Indians.

Still ahead, political impressions from "Saturday Night Live" star Darrell Hammond. And up next, what's J.C. Watts doing in the Washington Redskins training camp?

(COMMERCIAL BREAK)

KING: Here in Washington, Congressman J.C. Watts made a name for himself, as the number four Republican in the House. But among college football fans, Watts may be better remembered as a former quarterback for the Oklahoma Sooners. Today, Watts is back on the gridiron, practicing with the Washington Redskins in Pennsylvania. Before he took the field, I spoke with Watts and, jokingly, asked him if he was planning a football come back, after he retires from the House early next year.

(BEGIN VIDEOTAPE) REP. J.C. WATTS, JR. (R), OKLAHOMA: No, John, not quite. I'm just up here having a little fun. I know Dan Snyder, and we talked about me doing this several years back and couldn't make it work, so we were able to do it this year. So I'm here. I'm going throw the ball around a little bit for the receivers today, and I could probably watch film for them, if I had to do that, but I couldn't help them a whole lot, physically.

KING: All right. Let me ask you a question about a different sport. The baseball players union representatives are meeting, today, presumably to set a strike day. What do you think the impact would be if baseball went on strike, psychologically and economically, for the country?

WATTS: Well, psychologically I think, it hurts. When you consider that last September 11th, baseball, September 11th of 2001, when we had the tragedies in New York and Pennsylvania and, there, in D.C., baseball helped us to recover. I'm convinced of that. I think it would be tragic, psychologically, and, obviously economically, if they went on strike, and I hope that they don't. I think that athletics, baseball, at this time of the year is good for the psyche of our country, and I hope they can get all their issues worked out, and we can continue to see good baseball for the duration of the year.

KING: You were home in the district during the recess, obviously, and will be going back, after your stop at training camp, today, and a speech, here in Washington tomorrow. The President holds a big economic forum, tomorrow, trying to remind the American people, yes, the headlines might tumultuous, but in his view, the economy is quite strong. Does this President have a lot to learn. Are you hearing from people back home complaints about the economy?

WATTS: Well, I think people are a little uncertain, today, John. Not just about the economy. I think there's a lot of things that's going on. The corporate accountability issues that we're dealing with, I think what we've seen happening happen in the faith base, in the faith community, over the last, you know six or seven months, you know, baseball talking about going out on strike. I think there's a lot of different things that's going on, today, that the President, from a psychological perspective, is having to deal.

But I like what the President is doing in saying we're going to hone in on this economy. We're going to keep passing positive policy or fighting for positive things in Washington to assist all that we possibly can, from where we sit in the White House. And, so kudos to the President hoping for really honing in on this economy, doing things trying to get it on the right track.

KING: All right, J.C. Watts, Congressman from Oklahoma, number four man in the Republican leadership, thank you for joining us, today from the Redskins training camp.

WATTS: Thank you, John.

KING: I assume you're telling Coach Spurrier, as a former option quarterback, that the Skins might need a running game down the road. WATTS: Well, I suspect he's -- by season start, by the start of the season, I suspect that he'll figure that one out.

KING: All right, thanks again, Congressman. Have a good day.

(END VIDEOTAPE)

Still ahead, a reality check on the President's environmental record. Our Brooks Jackson will tell us if Mr. Bush's critics are on target or off track.

(COMMERCIAL BREAK)

KING: A new television ad accuses President Bush of working with big business to roll back the nation's clean air laws, and it urges citizens to try to stop him. The spot, being run by the Natural Resources Defense Council, is running, here in Washington and in six states, where the environmental group is targeting members of Congress from both parties.

(BEGIN VIDEO CLIP, NATURAL RESOURCES DEFENSE COUNCIL AD)

UNIDENTIFIED MALE: This type of thinking sure hasn't worked to protect our environment. Then, what makes the Bush administration think that it's going to protect the air we breathe?

(END VIDEO CLIP)

KING: That spot's being rolled out as Secretary of State Colin Powell prepares to represent the United States at an environmental summit in South Africa, later this month. Our Brooks Jackson has a reality check, now, on global criticism of the administration's environmental policies.

(BEGIN VIDEOTAPE)

BROOKS JACKSON, CNN CORRESPONDENT (voice-over): How green is President Bush?

GEORGE W. BUSH, PRESIDENT OF THE UNITED STATES: We have a duty in our country to make sure our land is preserved, our air is clean, our water is pure.

JACKSON: Sounds good. But, critics such as the Sierra Club say the actions don't match the talk.

DEBBIE SEASE, SIERRA CLUB: The Bush administration has established a terrible record on the environment. It is no better than you would expect, of course, from an administration made up of oil company executives.

JACKSON: So what is the record? Maybe not what you think. Remember the flap over arsenic?

AL GORE, FORMER UNITED STATES VICE PRESIDENT: They thought that maybe there wasn't enough arsenic in the drinking water. JACKSON: Sounds bad. But, here's what really happened. For years, the federal ceiling on arsenic has been 50 parts per billion in drinking water. And, despite what Al Gore says, Bush never proposed raising that. A rule pushed through in President Clinton's last days would have cut that limit to 10 parts per billion by the year 2006, and Bush did suspend that reduction. But, after a year of study, Bush set the limit at 10 parts per billion, by 2006. Exactly as Clinton had done. No difference.

On bigger environmental issues, Bush's record is mixed. He pushed to allow oil drilling in a part of the Arctic National Wildlife Refuge, unsuccessfully. But, off Florida's beaches in the Gulf of Mexico, Bush is moving to stop drilling plans. Bush opposed tighter fuel-mileage limits on SUV's and trucks, but supports more money to research hydrogen and fuel-cell vehicles for the future. Bush rejects the global warming agreement reached under Clinton.

BUSH: The Kyoto Treaty would severely damage the United States economy, and I don't accept that.

JACKSON: But Clinton, himself, refused to send the agreement to the U.S. Senate for ratification, knowing it would have been killed. President Bush says economic growth comes first.

BUSH: It is growth that provides the resources for investment in clean technologies.

JACKSON: He wants to get rid of detailed regulations on power plants that he calls a confusing and ineffective maze producing too many lawsuits and not enough progress. Instead, the President proposes a system of market incentives in which plants that pollute more than the government allows would have to pay a financial penalty. He says his clear skies plan would cut major pollutants from power plants 70 percent by the year 2018. Critics say, current law would cut pollution even more, if enforced.

SEASE: I think that the so-called clear skies approach would dirty our skies, not clean them up.

JACKSON: But some environmental groups say Bush's plan will work nationally, as a similar approach already has worked to reduce acid rain in places like New York's Adirondack region.

JOHN SHEEHAN, ADIRONDACK COUNCIL: The bill that the President had introduced in the House and Senate, just recently, is much better than a lot of people are giving it credit for being, and I think ...

(END VIDEOTAPE)

KING: Sorry to interrupt that piece by Brooks Jackson. We need to take you, immediately though, out to Chicago. Don Fehr, the president of the Major League Baseball Players Association's is speaking.

DON FEHR, PRESIDENT, MAJOR LEAGUE BASEBALL PLAYERS ASSOCIATION: ...and an overall agreement could be reached in the very (UNINTELLIGIBLE)...

KING: OK, we interrupt that. We're are going to take a break. INSIDE POLITICS will be right back.

(COMMERCIAL BREAK)

KING: We want to take you back live to Chicago. This is Donald Fehr. He's the head of the Major League Players Baseball Association speaking after at a meeting with players, today, at which no strike date was set. Let's listen into Don Fehr.

(JOINED IN PROGRESS)

FEHR: ... resulted in agreements on a number of issues. We still have a number of issues yet to be resolved, including what probably are the most significant ones, those relating to the overall amount of revenue-sharing and the method of raising and distributing the amounts shared and whether or not there will be a luxury tax in this agreement and if so, what that will be. We are hopeful that over the next several days, we'll be able to work through those issues and be done with the business of negotiating for this bargaining round. If not, then the players will meet again on Friday and consider what further steps ought to be taken. There really isn't much more to say about it than what I have, and so I'll be glad to try and answer some questions from you, if you have it. The players that are here will be here for only a very few minutes. They've got planes to catch. I'll be around for quite a while yet. Questions?

QUESTION: (UNINTELLIGIBLE).

FEHR: I didn't hear the first part.

QUESTION: Tell us what the gist of your conversation (UNINTELLIGIBLE). Was it just bringing you up to date on things or did you (UNINTELLIGIBLE)?

FEHR: Without getting into the specifics of it, it was not a long conversation, but we talked about the overall situation in bargaining, what has transpired the last several days and, you know, the hopes that we had as to what might transpire in the next few days. And that's really all I can say about it. I don't want to reveal the specifics of the conversation.

QUESTION: Were you at this point in 1994 (UNINTELLIGIBLE) where you are now. What is the difference between what you decided then and (UNINTELLIGIBLE)?

FEHR: In 1994 by this stage, I think we were satisfied there was, virtually, no possibility of an agreement in the short run, and that the setting of a strike date would, at the absolute minimum, be required to get an agreement. We don't know whether that will be true this time. We hope that it won't be.

QUESTION: Can you characterize your last two days of meetings with the owners' representatives as positive in a move toward allowing this three or day-day period to exist? FEHR: I don't want to segregate out the last couple of days. But if I can redirect your question to the last several days, perhaps I can say again what I said a couple minutes ago. There has been progress made on a number of issues. We still have some significant hurdles, you know, to overcome and in any bargaining round, you have ups, and you have downs, and you have days which look better than other days. Hopefully over the next several days, you know, we'll find a way to address the remaining issues between us. That remains to be seen, but that's the hope.

QUESTION: Has the drug testing issue become for you as troublesome to resolve as the luxury tax issue?

FEHR: No, I don't think so, and I'll tell you why. The question was, has the drug issue or the steroids issue become as troublesome as the luxury tax issue. One of the purposes of the meetings we had with players was to fully discuss that issue, as well as all the others. And at the end of that process, we were able to make a proposal to the clubs which reflected consensus among all the players as to what the correct approach was. We expected and hoped that that proposal would be met by the clubs as the basis upon reaching an agreement, and while we don't have agreement on all issues yet, you know, I'm fairly confident that we will be able to reach it.

QUESTION: (UNINTELLIGIBLE) setting a strike date then?

FEHR: All I can say about that is that the players will talk about what the status of the bargaining is on Friday and make judgments then. There's no point in trying to set up arbitrary preconditions ahead of time.

QUESTION: Why was it not necessary to establish a date today?

FEHR: Question was why was it not necessary to establish a date today. You establish a date when you believe that it's essential to reach an agreement, but bearing in mind that a strike is the last thing the players want. They get to it only when they feel that they must, and we are not at that point, yet. Hopefully we won't be. Time will tell.

QUESTION: (UNINTELLIGIBLE).

FEHR: I didn't see who asked the question, but OK, I don't know what some owners will do. If they do, it would suggest to me that they don't know very much about players, and I would be astonished if the clubs' negotiators or the commissioner interpreted it that way. Yes.

KING: We've been listening to Donald Fehr. He's the head of the Major League Baseball Players Association union. The players and their union chiefs meeting in Chicago to discuss whether or not to set a strike date for major league baseball. For now, Don Fehr saying, the players have not set a strike because of some progress in the negotiations. He says he is fairly optimistic more progress, perhaps a break through, can be made over the next several days in negotiations with the owners. If not, the players will meet again on Friday. At that point, they would, then again, consider whether or not to set a strike date.

I'm John King in Washington. Thanks for watching. "WOLF BLITZER REPORTS" begins right now.

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