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U.S. Officials Claim Iraq Harboring Al Qaeda; Democrats Pamper Each Other in Debate; D.C. Mayor "Troubled" By Decision to Hold Olympics Elsewhere

Aired August 28, 2002 - 16:00   ET


JUDY WOODRUFF, CNN ANCHOR: I'm Judy Woodruff in Washington. There is a new report that the FBI mishandled important clues pointing to last year's terrorist attack. I'll talk with Senate Intelligence Committee Chairman Bob Graham.
JAMIE MCINTYRE, SR. PENTAGON CORRESPONDENT: I'm Jamie McIntyre at the Pentagon. Some top al Qaeda figures may be hiding in Iran and Iraq. I'll have the latest on what U.S. intelligence officials believe.

GARY TUCHMAN, CNN CORRESPONDENT: I'm Gary Tuchman in Nashville, Tennessee. The preliminary results are in following a delivery to Al Gore's office yesterday of a letter filled with white powder.

SUSAN CANDIOTTI, CNN CORRESPONDENT: I'm Susan Candiotti in Miami. The Florida Democrats running for governor hold a debate. They go easy on each other but get decide to get tough on incumbent Republican Jeb Bush.

WOODRUFF: Thank you for joining us. U.S. military response to September 11 sent top al Qaeda leaders scrambling for cover. But the fate of most of those leaders, including Osama bin Laden, has never been confirmed. Today there are new reports that some top ranked al Qaeda officials are in hiding in both Iraq and Iran. For the latest, let's turn to Senior Pentagon Correspondent Jamie McIntyre -- Jamie.

MCINTYRE: Well, Judy, it's been no secret that once the U.S. smashed the Taliban government in Afghanistan, al Qaeda and Taliban leaders took refuge across the porous borders in the nearby countries of Pakistan and Iran, just crossing those borders into that border area. But now U.S. intelligence officials are saying that, telling CNN, that credible reports lead the U.S. to believe that two top al Qaeda leaders are among dozens of terrorist fighters who have been given refuge in two Iranian cities right along the Afghan border. For months now, the Pentagon has fingered Iran as a safe haven for al Qaeda fugitives.

But now we're hearing some of the names that might be involved. Back in January, Pentagon officials thought that they had killed a top aide to Osama bin Laden in a bombing run. A man known as Mafous Walid (ph), also known as Abu Haas (ph), the Mauritanian. Now it's believed that there are credible reports that he is one of the people running al Qaeda from a safe house in eastern Iran and this man, also a high ranking al Qaeda leader named Saif Al-Adel, an Egyptian on the FBI's most wanted list, is thought to share authority with Walid.

U.S. officials believe the pair are planning new terrorist attacks. Iranian officials deny that these two men are in Iran. They say that they are cooperating with the war on terrorism. Even as they oppose, Iran opposes, the talk in the United States of a possible attack against Iraq.

Now, in June, Iran did turn over 16 suspected al Qaeda suspects to Saudi Arabia, and Saudi officials have pointed to that as evidence that Iran is cooperating. But the Pentagon is unimpressed. Earlier this month, Defense Secretary Donald Rumsfeld said that he saw absolutely no cooperation from Iran in trying to track down those al Qaeda suspects who are believed to be in Iran. And oh, by the way, they also believe one top al Qaeda suspect, one top leader, is in Iraq, being protected by a rebel Kurdish group -- Judy.

WOODRUFF: Jamie, quickly, why has it taken so long for intelligence officials to learn this?

MCINTYRE: Well, this -- I don't know if it has taken them so long as it's taken us a little while to figure out what they know or what they think they know. The real bottom line is they don't have absolute answers about where any of these people are. What they are doing is evaluating the intelligence that's coming from foreign governments and other places and making an educated guess about where they think the fugitives still are.

WOODRUFF: All right. Jamie, thanks very much.

Well, one more note on the U.S. and Iran, Iran's president said today that he does not support the regime of Saddam Hussein, but he said he also opposes a U.S. attack against Iraq. President Mohammed Khatami said that while the September 11 attacks, quote, "shook the entire world, the U.S. response to the attacks is, in his words, "worse than terrorism itself."

Here in the United States, investigations continue into what the Federal government knew or should have known in the days and weeks before September 11th attacks. Today's "New York Times" has details on an upcoming report by the Senate Judiciary Committee which criticizes the FBI's investigation of Zacarias Moussaoui, the so- called 20th hijacker. Among the allegations, that FBI lawyers failed to approve search warrants for Moussaoui's computer because they were ignorant of Federal surveillance laws. A little while ago, I spoke with Senator Bob Graham of Florida.

He's the Intelligence Committee chairman. He told me he agreed with fellow committee member Arlen Specter, who told the "Times" that evidence available to the FBI would have provided a veritable blueprint for September 11.


SEN. BOB GRAHAM (D), INTELLIGENCE COMM. CHMN: I do agree with that. There were many sources within the Federal government collecting information. There was no single source that was looking at all that information to try to see if there was a pattern, a picture, a plot, that began to emerge. Had that happened, then I think another series of questions would have been asked, more information would have been collected, and with luck, it might have occurred early enough to have disrupted the hijackers before the horrific events of September 11.

WOODRUFF: Well, if that's the case, is it enough just that some heads are going to roll or does something much more drastic have to take place in the intelligence community?

GRAHAM: There needs to be a number of reforms. We are half way through a major investigation by the House and Senate intelligence committees of what happened before on and after September 11 and what should be done to reduce the chances of that occurring in the future.

Some of those things are beginning to come forth and be acted upon, one of which is to establish within the new Department of Homeland Security an analytical capability where not only will the information from all of the federal intelligence collecting agencies such as CIA, FBI come, but also information from state and local law enforcement will be integrated. I think that will be a substantial advance in terms of our ability to see terrorist plots before they are played out.

WOODRUFF: Senator, to another report today in the "Washington Post," and that is that two senior al Qaeda leaders being harbored in Iran. Intelligence information pointing the several al Qaeda figures working out of Iran. What does it say about U.S.. intelligence capabilities that it's taken this long to find this out and it's coming from an Arab intelligence source.

GRAHAM: Well, we work very closely with intelligence agencies from other countries. They are an important part of our total intelligence collection capability. I don't know the specific facts of this case. We do know that Iran has been the place to which a number of al Qaeda members, including some of the leadership of al Qaeda, have fled in the aftermath of the war. So the fact that they are showing up in Iran is not surprising.

WOODRUFF: Senator, yet another report, this one in the "New York Times" that U.S. forces in Afghanistan working under the assumption that Osama bin Laden is still alive, that he's hiding out somewhere in the mountains between Pakistan and Afghanistan. What do you believe about where he is and in terms of how much information you have?

GRAHAM: What I believe is what I have been told by our intelligence agencies, which is that the best analysis is that bin Laden is probably still alive, living in that region between Afghanistan and the tribal territories of Pakistan, taking advantage of his knowledge of the territory and the support and sanctuary that he's able to receive from the residents in that very rugged, remote area.

WOODRUFF: And do you believe the U.S. military missed a major opportunity earlier to get rid of him? GRAHAM: There's some speculation that in the battle of Tora Bora that we could have sealed off some of the mountain passes and maybe kept bin Laden inside. That is speculation, which at this point is without confirmation. One of the things Judy that this -- that I think we need to be careful about. Bin Laden is an important figure. He brought charisma, money and a high intelligence to al Qaeda.

But the really important institution is al Qaeda itself and that our focus needs to be on dismantling al Qaeda so that it can no longer be the scourge that it was on September 11. I hope we get bin Laden. Knowing finally that he is either dead or in custody will make us sleep better at night. But that's not, by any means, the totality of our goal in Afghanistan and relative to al Qaeda.

WOODRUFF: Message heard, Senator Bob Graham, chairman of the Senate Intelligence Committee. Thank you.

GRAHAM: Thank you.


WOODRUFF: To another story now. World reaction to the U.S. military response to September 11th is evidently a main reason that the nation's capital is now out of the running to host the 2012 summer Olympics.

Yesterday, the U.S.. Olympic Committee chose New York and San Francisco as the two finalists to bid for the games. A little more than an hour ago, I talked with Washington's Mayor, Tony Williams, at a campaign stop in his race for reelection.


WOODRUFF: Mr. Mayor, thank you for talking with us.


WOODRUFF: Any idea today from the U.S. Olympic Committee why the decision yesterday to eliminate Washington from the finalists?

WILLIAMS: Well, certainly the -- no official indication, but certainly what I'm reading and what I'm hearing from people who were at the press conference is there is some indication that our bid certainly met all of the specifications financially and met all the specifications technically. We had the infrastructure that we needed.

To use the Olympic analogy, on the technical merit, we were all there. But something happened with the subjective artistic presentation in terms of international reaction. And that's particularly troubling to me because there's really not much I can do about the international perception of this country and the inner workings of the federal government as it relates to the Olympic committee.

WOODRUFF: Well, does it make sense to you that there was a fear there that the international committee would hold U.S. policy against Washington as a city as a venue?

WILLIAMS: No, I don't think it's fair. I think -- one of the things that's really disappointing to me is I really hoped that the Olympics would be a way that we could markedly (ph) on the world stage distinguish Washington, D.C. the city from Washington, D.C. the government town. We're not just an appendage of the Federal government. We're a living, breathing city of international stature and diversity that really would be a great place to have the games.

WOODRUFF: What does it say...

WILLIAMS: And we lost that opportunity. So we've got to find another opportunity to do that now.

WOODRUFF: What does this whole process, though, say to you about the whole Olympic process?

WILLIAMS: You know, I would like to -- I would like to believe that everyone operated in good faith. I think Charlie Moore (ph) is a good man. I have a very, very high opinion of him.

WOODRUFF: The head of the Olympic committee.

WILLIAMS: The head of the bid committee. I would like to think that they operated in good faith and perceived that way.

WOODRUFF: So you're going to have a benign view.

WILLIAMS: I'm going to have a benign view, but it's troubling.

WOODRUFF: Mr. Mayor, your campaign, you are out here campaigning day and night looking for write-in votes after your campaign botched this petition effort.

WILLIAMS: Like Diana Washington says, what a difference a day makes.

WOODRUFF: What do you say to those people who are still out there asking, how did this happen?

WILLIAMS: You know, what I've said to people all across this city is we've come a long way in this city. Here I am, standing off the ballot, you know, I, more than anyone else in the world, I'm asking how could this happen.

But I don't have time to be humiliated, embarrassed and indignant and angry. I've only got time, two weeks, to get my message out and marshal my voters for election day. This is a huge, a write-in effort is a huge logistical challenge.

In many, many ways this election is, I think, turning the clock forward in this city in terms of participatory democracy. That's good, but in a lot of ways, challenging ways, we're turning the clock back. We're going back to the 19th century. We're going to wait a week to get results. We're going back years where you don't have a lot of middle men. You're talking directly to the people. So it's a mixed bag.

WOODRUFF: One of your more vocal opponents, Reverend Wilson, (UNINTELLIGIBLE) Wilson, is out there saying pretty terrible things about you. He's calling you arrogant. He said you're insolent. He said you don't tell the truth. You haven't treated the district residents with respect. I mean...

WILLIAMS: You know, a campaign you're always going to have exaggeration, a campaign you're always going to have attacks but you know, I'm really distressed that the attacks have gotten down to a (UNINTELLIGIBLE) personal level, because really this election isn't just a beauty contest about Tony Williams. This election is about people of the city and I think when people of this city think about billions of dollars of investment in this city, the fact that we even came in the final contention for the Olympics, the fact that our investment rating is up and these investments mean more dollars for services (UNINTELLIGIBLE) day care, education, housing.

People are going to walk in that voting booth and they're going to say, you know what, he may have made this mistake. We may not like this about the mayor, but he's our mayor, and they're going to keep me in office.

WOODRUFF: Are you going to win?

WILLIAMS: Yes, I am confident. I am very, very confident. It's going to be hard. But absolutely, we're going to win. No question.

WOODRUFF: What makes you so sure?

WILLIAMS: Because I believe that the attacks I think are going to backfire. I think that more and more of the momentum is going in my favor because people wanted me to, wanted to see me out there on the sidewalk, on the streets, begging for votes to keep my job on the line and that's where I am and I think people want to see that.


WOODRUFF: The mayor told me they're working to educate voters to spell his name correctly on the ballot in order for it to be counted. That election coming up on September 10.

Another story now in the last hour. Officials in Tennessee have announced initial test results on the white powder that was mailed to Al Gore's Nashville office. For the very latest, let's turn to CNN national correspondent Gary Tuchman in Nashville -- Gary.

TUCHMAN: Judy, the delivery came yesterday. A letter addressed to Al Gore here at his national headquarters in Nashville. One of his assistants opened a letter and white powder spilled in her lap. It was a very nervous 24 hours for her and another person who were inside the office. But a short time ago authorities told CNN the results of the preliminary testing.


UNIDENTIFIED MALE: Was the powder anthrax?

KIM LAWSON, ASST. NASHVILLE FIRE CHIEF: Preliminary reports are back, and they prove to be negative. Final results will be given after Saturday.

UNIDENTIFIED MALE: So are we comfortable right now saying that this was not a dangerous substance?

LAWSON: Yes. The preliminary reports do show that it was negative there. There were several things that they are still testing for. Those results will be final after Saturday.

UNIDENTIFIED MALE: Do we know what the substance was?

LAWSON: No, it is my understanding they do not check to see what the substance was.

UNIDENTIFIED MALE: And do we know if it came from a prison, the letter?

LAWSON: That would be part of the investigation.

KEITH BRYARS, FBI: We have determined at this time that the letter, most like in fact, came from a correctional facility. However, our investigation is not complete. And we are conducting further investigation to determine where it came from.

UNIDENTIFIED MALE: Do we know which correctional facility it probably came from?

BRYARS: Again, we're continuing our investigation to determine if in fact it did come from a correctional institution and if it did, which one and determine the people that were responsible.

UNIDENTIFIED MALE: And it would seem if it came from a correctional facility it wouldn't be so hard to find out who wrote the letter, is that fair to say or not necessarily?

BRYARS: Well, I think if we can determine that it did in fact come from a correctional facility, that it does limit the number of participants who could have sent the letter, yes.

UNIDENTIFIED MALE: Have you informed the two people who were in the office about the preliminary results.


UNIDENTIFIED MALE: And what was the reaction?

TROTTER: They were very happy. They were quite calm. I have to admit, apparently Mr. Gore prepped them in advance. They had had exercises just in the case that this would happen. So they were actually very, very easy to work with.

(END VIDEOTAPE) TUCHMAN: Mr. Gore and his wife, Tipper, were on vacation in northern California when this happened. They were aware of the situation. We can presume when they hear this news about the test results, they will be very relieved. Judy, back to you.

WOODRUFF: All right, Gary. Thanks. Good news all around. Appreciate it.

Ahead here, we check up on several important campaigns, beginning in Florida. The candidates play nice in a televised debate and aim their toughest criticism at the incumbent Jeb Bush.

The anniversary of Martin Luther King's, I had had a dream speech, a progress report and a reality check on America then and now.

And later, political ads that are just a little off center.


TV AD: Here in South Carolina, we love you tar heels buying our lottery tickets. Hundreds of millions of dollars worth.


WOODRUFF: Haven't we seen this guy before? A familiar sales pitch for another state considering a lottery.



DARRELL JONES (D), FLA. GOV. CANDIDATE: Hurricane Jeb has wreaked havoc and destruction throughout Florida.


CANDIOTTI: All three candidates chastised Bush over his controversial selection to head Florida's embattled child welfare agency.


JANET RENO (D), FLA. GOV. CANDIDATE: The governor of Florida hadn't done his homework.

BILL MCBRIDE (D), FLA. GOV. CANDIDATE: The governor needs to take responsibility for this.

JONES: This is not the guy for the Department of Children and Family Services.

CANDIOTTI: Former Attorney General Janet Reno remains the Democratic front runner.

RENO: I love Florida.

WOODRUFF: This week, Reno unveiled her first TV ad.

RENO AD: She's got a plan to help seniors afford the medicines they need.

CANDIOTTI: Meantime Bill McBride is getting zinged by the Bush campaign. A TV spot charge him with tap dancing around the issues.

BUSH AD: MCBride funds his campaign against Janet Reno by evading campaign finance laws with tricky accounting.

CANDIOTTI: Corporate attorney McBride applauds the ads as a sign Bush is worried about taking him on over Reno.

LT. GOV. FRANK BROGAN (R), FLORIDA: Trying to get into a Democratic primary and help choose the Democratic candidate that he wants to run against. I think he's scared to death.

CANDIOTTI: Long shot state senator Darrell Jones made a solid appearance, at one point putting on hard hat to single out his theme: rebuild Florida. Bush's lieutenant governor in the debate audience not surprisingly was unimpressed.

UNIDENTIFIED MALE: It wasn't a debate, it was a panel discussion.

CANDIOTTI: Political pundits say no matter who wins, Bush is untouchable at least for now.

UNIDENTIFIED FEMALE: My experience with Florida politics is that the gap closes quickly between Democrats and Republicans once that nominee is selected.

CANDIOTTI (on-camera): With only about two weeks to go, the Democratic candidates are already talking about post primary unity. And they are going to need to come together before the general election. As political analysts see it as the incumbent governor, it's Jeb Bush's race to lose. Susan Candiotti, CNN, Palm Beach County, Florida.


WOODRUFF: There was also a Democratic gubernatorial debate in Massachusetts last night. And there the three males in the race went off the female front runner. Polls show State Treasurer Shannon O'Brien leading the Democratic race with the primary three weeks away. Her challengers questioned O'Brien repeatedly about her handling of the state's pension fund, which has sustained huge losses over the last two years. The Democratic winner in the Massachusetts race will face Republican Mitt Romney in November.

Coming up, the latest on that 9-year-old California boy kidnapped in a daring home invasion.

Plus, he was the top numbers cruncher for WorldCom. Now, there's a Federal indictment at his number.

But first, let's turn to Allan Chernoff. He's at the New York Stock Exchange, for today's market update. Hi, Allan.



WOODRUFF: Checking the stories in the INSIDE POLITICS "Newscycle": There is still no trace of a 9-year-old boy abducted from his home in Palm Desert, California, early this morning. Police say two men kidnapped Nicholas Michael Farber after roughing up his father. The father says he did not know the men. But, sources tell CNN, authorities don't think it was a random act.

In Norwalk, Connecticut, courtroom arguments continue over what sentence Kennedy cousin Michael Skakel should serve for killing a teenage female neighbor in 1975. The judge has denied his request for a new trial. Skakel could spend anywhere from six years to life in prison. A jury convicted him in June in the beating death of Martha Moxley.

And with us now Mindy Tucker, she's communications director for the Republican National Committee and Jennifer Palmieri, press secretary for the Democratic National Committee. So much to talk about but let's start with the story in the "New York Times" today. I want to start with you Mindy. Basically the story is that one of the centerpieces of the president's education reform plan, a plan whereby schools, when a school is failing parents could have the opportunity to send up to 3.5 million kids across the country to different schools, better schools. What they found though in looking into this is that a very small, just a handful of parents are taking advantage of this. Does this mean that the president's plan is, in essence, going nowhere?

TUCKER: I think for the number of parents who have chosen a better path for their children, absolutely not. If it helps one child, it is worth it.

What we have to remember here is, what we're looking at is, we're identifying failing schools, something we haven't done before. That's the first really good thing that we have done. We now know that these schools are failing these children. And the second thing we have done is offered choice. Whether parents choose to do it or not, it doesn't matter. They have actually -- they have the opportunity to choose. They can choose a better path for their child.

They can choose a school that will teach their child how to read, how to do math, how to do the things that are going to enable that child to be successful. It is very important that you step back and not just look at the numbers from day to day. Step back and look at the overall picture. Have we offered people a choice? Is it going to be better for the people who choose it? Yes. And that's what we need to focus on.

WOODRUFF: Jennifer?

PALMIERI: I'm not going to differ that much different from Mindy on this, except, what I found was interesting is that I think it shows that parents don't want to give up on public schools and that they are worried about failing schools, but they see the school as a community. And they don't want to uproot their kids from that school.

And I think what it shows that they would like is more investment in public schools to fix the schools that their kids are attending. And I think it is great that President Bush and the Democrats got together and they passed this education reform bill. And I support the gist of what Mindy said about having choice and turning around our failing schools.

But we need more resources. And that's where the president dropped the ball. He didn't provide the resources that we need.

TUCKER: And now also, parents know where to go to ask for change. They know which schools to go to, to say: "Hey, you're not doing what you need to do for my child. We want change."

PALMIERI: But none of this is going to matter unless Bush puts the resources in there that we really need to have this education reform.

WOODRUFF: Speaking of resources....

PALMIERI: Speaking of resources.

WOODRUFF: ... the Congressional Budget Office just yesterday issued a report calling for all those surpluses that we thought were coming in the trillions, now down to the billions, still a lot of money, but not nearly what it was.

My question to you, Jennifer, the Democrats have been saying the president's tax cut largely has contributed to the disappearance of the surplus. If that's the case, why aren't more Democrats calling for a repeal of the president's tax cut?

PALMIERI: Well, I think it is because -- you remember early this part of year, in January, I think, the president said that, over his dead body, would he repeal a tax cut.

And I think the Democrats think that what's more productive is to focus on making sure that there are no new tax cuts that are unwise that will get us into more problems. But I think what is really ironic about the situation is that, a month after we had this big corporate responsibility scandal in which the administration was hurt politically and was vulnerable personally, the budget director comes out with a report that cook the books with gimmicks to try to hide the deficit.

And it hurts their -- this is not exactly an economic team that's oozing in creditability. And I think it hurts their creditability more.

WOODRUFF: Well, I want to stick with the CBO question. And the question is, the president wants to make these tax cuts permanent, Mindy. If that happens, these surpluses are going to shrink even more. TUCKER: Well, that's actually not true.

And the real answer to your question to Jennifer is, the reason that they're not calling for repeal of the tax cuts is because that's not what caused it. What the CBO has actually said is the recession and the war -- September 11 and the war have caused us some problems.


TUCKER: But more importantly, what they did say is what's really going to be crucial to getting us back to a balanced budget is fiscal restraint, something the Democrats are not very well known for and something the president...


TUCKER: ... has actually had to stop $5.1 billion in unnecessary spending in the last little while. And I think that is the key to this, that this fall...


WOODRUFF: Let her finish. Let her finish. And then you get to speak.

TUCKER: If the Democrats help us with fiscal responsibility this fall, even though they still, in the Senate, have not passed a budget -- it is something we should all be worried about. That is the biggest threat to our economy and further recession now, is no budget in the Senate from the Democrats and just out-of-control spending in Congress. That's what we have got to hold off on.

WOODRUFF: Jennifer.

PALMIERI: Well, I think the Democrats -- it was a hallmark of the Clinton administration to be fiscally responsible. And that's the most important thing government can do to keep the economy -- it's the most important thing that we can do to contribute to the strength of the economy.

And that's what Democrats are arguing for. And it is incredibly disingenuous for the administration to put forward a budget report that they know hides losses, hides deficits. And to do that after...

WOODRUFF: You're bringing up this OMB budget again. OK.


PALMIERI: Yes. But my point is that they are not living by the numbers.

WOODRUFF: I'm sure you disagree.


TUCKER: We'd love for the Senate to live by the numbers and pass the budget. But we haven't had that either.

WOODRUFF: All right, we're going to leave it there.

Mindy Tucker, Jennifer Palmieri, always great to see the both of you. Thank you. You're great for dropping by. Thank you very much.

An update on debates and races in Arkansas and South Dakota next. And later, former Congressman Steve Largent takes a successful first step toward the Oklahoma governor's mansion.


WOODRUFF: Returning now to news from the campaign trail: Arkansas Republican Senator Tim Hutchinson and Democratic challenger Mark Pryor shared the stage last night in a televised debate. A Zogby poll taken this month gave Hutchinson a slight edge in the race. But a more recent poll by Opinion Research gave a sizable lead to Pryor.

Earlier, I discussed the race with columnist John Brummett of the Stephens Media Group. He attended the debate and he shared his thoughts on who came out on top.


JOHN BRUMMETT, "ARKANSAS TIMES": If a tie goes to the challenger, I guess you could say that Mark Pryor won. He's been running a very effective campaign, a smart campaign, avoiding mistakes.

But the one thing he needed to do was show that he had the stature and substance to stand next to a United States senator and hold his own. And it's generally believed today that he at least did that, might actually have bettered Hutchinson a bit on style points and, substantively, not lost any ground. If you scored it strictly on substance, Hutchinson might have been a little bit ahead, but not by so much that it was stark or troubling for Pryor.

Toward the end of the debate, they got into this customary discussion about the regrettably negative tone of the campaign. Whenever you have a targeted Senate race -- and we're on the last go- round for unrestricted soft money -- as you can imagine, we're afraid to go near our televisions down here, because it is just attack ad by soft money funneled through the parties.

And, of course, both candidates wanted to blame the other guy for starting it and for his side being the worst perpetrator. And that sort of dominated the discussion at the end. And Pryor made a vigorous defense that Hutchinson had attacked him first and that he would defend himself. Hutchinson shot back with a remark about a cheap shot. And that was probably the liveliest part of the debate.


WOODRUFF: John Brummett, reporter in Arkansas.

Well, the candidates in the tight South Dakota Senate race also held a debate Monday night. Democratic incumbent Tim Johnson and his challenger, GOP Congressman John Thune, traded claims over who would carry the most influence in the Senate. Johnson argued his relationship with fellow Democrat and South Dakotan Tom Daschle gives him the edge. Thune said he could work well with both Senator Daschle and President Bush.

Just ahead: We have always heard that laughter is the best medicine, but, in politics, it can be lethal. We'll look at some of the latest comical campaign ads and see who is the butt of the jokes.


WOODRUFF: Checking our "Ad Reel" today: North Carolina is experiencing a Bubba invasion. A group sponsoring a state lottery referendum has brought back a tried-and-true technique to gain support for gaming.


UNIDENTIFIED MALE: Here in South Carolina, we love you Tarheels buying our lottery tickets, hundreds of millions of dollars worth. Why, you North Carolinians are helping to fund our children's schools. And those South Carolina lottery tickets you all buy will put millions into K-through-12 education south of the border.

Thank goodness your legislators in Raleigh won't give you your own education lottery. So now you know why, here in South Carolina, we just love your good old North Carolina legislature.


WOODRUFF: Back in 1998, South Carolina Governor David Beasley was the target of a similar ad. But that time, the Bubba was from Georgia. Incidentally, Beasley lost his bid for reelection in '98 and South Carolina started its lottery last year.

Another North Carolina ad takes aim at Elizabeth Dole.


JIM SNYDER (R), NORTH CAROLINA SENATORIAL CANDIDATE: Politicians do the darndest things to try to fool us. Hillary Clinton put on a New York Yankees hat and claimed to be a New Yorker. Bob and Elizabeth Dole sat in rockers and said they were from North Carolina.

No, Elizabeth, North Carolina is not New York.

Do you believe the Elizabeth Dole ad that claims that her mother actually lives with her, while her husband lives in Washington and can't even vote for her?

I'm Jim Snyder. My wife can vote for me. I understand North Carolina values and I always will tell you the truth.

(END VIDEO CLIP) WOODRUFF: North Carolina's Senate primary is September the 10th. It's a crowded field, with 18 Democratic, Republican and libertarian candidates on the ballot.

Checking the headlines in our "Campaign News Daily": Former GOP Congressman Steve Largent scored a big victory yesterday in his race to succeed Frank Keating as Oklahoma's next governor. The pro football Hall-of-Famer received 87 percent of the vote against two Republican primary challengers. Largent will face the winner of a Democratic runoff between businessman Vince Orza and state Senator Brad Henry.

Also in Oklahoma, Republican strategist Tom Cole won his primary in the race to replace another former football star, retiring Congressman J.C. Watts. Cole rode an endorsement from Watts to victory, picking up 60 percent of the vote in a six-man race.

Former Maryland Congresswoman Helen Bentley will receive some high-profile help tonight in her effort to return to Congress. EPA Director Christie Whitman will join Bentley for a fund-raiser at Baltimore's Camden Yards, home of baseball's Orioles. Bentley is trying to regain the 2nd District seat that she held for 10 years beginning in 1985.

And this program note: Our Kate Snow will have an inside look at Maryland's 2nd District race on tomorrow's INSIDE POLITICS.

Right now, we have some breaking news: the Justice Department, reports of an indictment against a man.

Our Kelli Arena is our Justice Department correspondent, with us now.

Kelli, a man in Washington state indicted for helping al Qaeda?

KELLI ARENA, CNN JUSTICE CORRESPONDENT: That's right, a U.S. citizen, James Ujaama, who was previously held as a material witness in the Justice Department's investigation into possible terrorist activities in Seattle.

He has now been formally charged, not held as a material witness anymore. And he's facing charges of providing training, facilities, computer services, safe houses, and personnel for terrorist purposes. His family, all through this time, has denied any terrorist links, say that he's being held, wrongfully accused. He's been held since July, late July in Justice Department custody.

Of course, if you're being held as a material witness, you don't face any charges. But now the Justice Department has come forward with formal charges against him, again, a U.S. citizen here, Judy, James Ujaama. And this links back to the reporting that we did some time ago about possible al Qaeda operations in Seattle, investigations into a now-defunct mosque there.

Several members, we were told, were under surveillance and under investigation. These look like the first terrorism-related charges in that investigation.

WOODRUFF: Again, his name is Earnest James Ujaama, a well-known -- at least in that community -- American-Muslim activist.


WOODRUFF: OK, Kelli Arena, thanks very much.

ARENA: You're welcome.

WOODRUFF: Coming up, reflections on an anniversary: 39 years after the world first heard four immortal words, "I have a dream," is it a dream fulfilled or a dream deferred?


WOODRUFF: Thirty-nine years ago today, Dr. Martin Luther King Jr. stood before the face of Lincoln and shook the world with a speech marked by the stirring refrain, "I have a dream."

CNN national correspondent Bruce Morton has some reflections on this anniversary.


BRUCE MORTON, CNN NATIONAL CORRESPONDENT (voice-over): If you're old enough, you remember the speech. And even if you're not, you have heard or read parts of it. "I have a dream," Dr. King said, in the one speech of the many that day that really stirred the country and the listening crowd.


MARTIN LUTHER KING JR., CIVIL RIGHTS LEADER: We hold these truths to be self-evident.


MORTON: Thirty-nine years later? You have to wonder what Dr. King would make of the speech being used in TV ads. Still, he was the one who copyrighted it. And maybe he always hoped it would make some money for his family.

Are we closer to the dream? Probably. In two Georgia primaries last week, black congressional candidates David Scott and Champ Walker won in districts that are not majority black, though Walker faces a run-off. Clearly, they were judged by character, not skin color, as King had hoped.

What else? By the time he was killed in 1968, King had moved beyond civil rights and was concerned with poverty and the bitter, divisive war in Vietnam that was tearing his country apart. Were he looking at today's America, he would see another controversy: over whether America should attack Iraq, be the aggressor, strike the first blow, an unfamiliar role for the U.S., and whether the president needed to ask Congress for permission before starting that war. Dr. King might hear echoes.

And he would surely be unhappy with all the killing in the world these days. Dr. King preached nonviolence. India's Gandhi was his spiritual role model. What would he make now of all the assaults aimed at killing the innocent, the attacks on America last September, the suicide bombings in the Middle East?

When King led the civil rights movement, all the violence was the work of white segregationists. They blew up churches and killed little girls. Their cops beat demonstrators seeking the right to vote. The guilt and outraged nonsegregationist, whites felt, was one of the tools King used to bring down the walls, to end legal segregation in America.

Nonviolence is out of fashion now. Those with grievances come bearing arms. And that, I think, would make him very sad.

Bruce Morton, CNN, Washington.


WOODRUFF: The Reverend Jesse Jackson was one of Dr. King's right-hand men. He joins us now in New York.

Reverend Jackson, is this an anniversary worth marking?


Thirty-nine years ago on this day, our country was divided by racial legal segregation. From Texas across to Florida, up to Maryland, we couldn't use a single public toilet. I was arrested trying to use a public library. We couldn't use a single golf course. We couldn't use a single tennis court. And we lived behind the laws of legal apartheid.

We got those laws changed a year later, then the right to vote a year later. So, 39 years later, we have public accommodations. We have the right to vote. But there's unfinished business. That is of a fair criminal justice system, an equal access to capital, and shared economic security, which was his last agenda for all Americans.

WOODRUFF: Let me ask you about a story today in "The New York" -- "Washington Post," actually -- about New York state Congressman Greg Meeks out campaigning for reelection and telling a reporter that he feels confined by the label of black political leader, that people assume that he's out of the civil rights movement, that his main agenda is labor issues or social issues, when he really wants to talk about business.

Are we seeing a generational change now, Reverend Jackson?

JACKSON: Well, one of the great challenges in my campaign was to be seen as a presidential candidate who could speak of foreign policy and domestic policy.

And my race is self-evident. No one ever referred to Bush as white governor or white president. Any white political leader would react to being labeled and limited by race. And so one can affirm one's race, not being limited and/or defined by it by in the way that often the media does.

They don't refer to black Barry Bonds, the baseball player, or the black Tiger Woods. Their race is separate from that. You judge them by their skill. And that's what political leaders are saying. "Let us have a chance to be senators and governors and deal with all the great issues of our time and not be race-limited by writers often who lock us in, if you will, those boxes."

WOODRUFF: But is there a demarcation line? Is it a case where leaders like you, who have built their reputations because of what they did in the civil rights movement, must step aside, make way for these younger African-American leaders coming along who want to talk about more than civil rights?

JACKSON: Well, you can't get beyond civil rights, for that is an unfinished agenda. We're going to march September 13 in Washington because Mr. Bush and Mr. Ashcroft have not met one time with organized labor in two years. They have not met with the National Organization of Women. They've not met with the Leadership Conference on Civil Rights.

There's this broad range of civil rights, social justice, civil liberties, workers-rights issues that remain ever present. And so civil rights is not, if you will, for blacks only. As we fight for Title 9 for women, the majority of beneficiaries are white women, plus women of other hues. As we fight for workers' right to organize, it is all workers who want liberal wages. There are 40 million Americans who have no health insurance.

Judy, most poor people are not black. They're white. They're female. They're young and largely unspoken for.

WOODRUFF: Reverend Jesse Jackson, on this 39th anniversary of the "I have a dream" speech, good to talk to you. Thanks for coming by.

JACKSON: Thank you.

WOODRUFF: We appreciate it.

I'll be back in a moment, but now we want to take a look at what is coming up on "WOLF BLITZER REPORTS" -- hi, Wolf.


A desperate search for a stolen child: why authorities in California are fearful for a 9-year-old boy. And medical news about to be made public for the first time: You may -- repeat, may -- be protected from smallpox and not even know it. And is the United States going it alone on Iraq? What some of the president's men say they are prepared to do. And learn what Iraq's neighbor is hiding.

Those stories, much more at the top of the hour, right after INSIDE POLITICS.


WOODRUFF: Tomorrow on INSIDE POLITICS: House Minority Leader Dick Gephardt, he's traveling around the country campaigning for Democrats. Tomorrow, he's in Las Vegas. We'll talk to him.

That's it for today's INSIDE POLITICS. "WOLF BLITZER REPORTS" is next.

We thank you for joining us. I'm Judy Woodruff.


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