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CNN CROSSFIRE

Bush to Unveil New Economic Plan Tomorrow, Democrats Counter With Plan of Their Own; Do Chickens Need More Time With Their Families?

Aired January 6, 2003 - 19:00   ET

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

ANNOUNCER: CROSSFIRE: On the left: James Carville and Paul Begala. On the right: Robert Novak and Tucker Carlson. In the CROSSFIRE tonight: economic fixes. There's the president's way...
(BEGIN VIDEO CLIP)

ARI FLEISCHER, WHITE HOUSE PRESS SECRETARY: The president's plan is a plan that helps all Americans.

(END VIDEO CLIP)

ANNOUNCER: ... and then there's the Democratic Party's way.

(BEGIN VIDEO CLIP)

NANCY PELOSI (D-CA), HOUSE MINORITY LEADER: All members of the caucus and leadership of the caucus have worked together for a fair, fast-acting, fiscally sound package.

(END VIDEO CLIP)

ANNOUNCER: Our question: whose way will pay political dividends?

The Big Apple gets the Republicans. Bean Town gets the Democrats. Whose conventioneers will have the better time in 2004?

And it may be finger licking good, but PETA says, have you considered things from the chicken's standpoint?

Ahead on CROSSFIRE.

From the George Washington University: Paul Begala and Robert Novak.

(APPLAUSE)

ROBERT NOVAK, CO-HOST: Welcome to CROSSFIRE. Tonight: dueling economic plans, dueling convention cities, and a duel between the animal rights crowd and the colonel's chicken. Make mine extra crispy. But the first thing on tonight's menu is our daily special, the CROSSFIRE "Political Alert."

Congresswoman Nancy Pelosi of California, the new House democratic leader, is farther left than anybody who ever held that post. And today she lived up to that reputation as she unveiled an economic plan in advance of President Bush's tomorrow. Tax cuts? Handouts would be given to low income people who don't pay income taxes.

Unemployment benefits will be extended to jobless workers, removing all incentive to find a job. Healthcare benefits for the poor would go to spendthrift state governments. All of this would further redistribute wealth. What it doesn't do is encourage investment and economic growth. Karl Marx might love it, but Adam Smith wouldn't.

PAUL BEGALA, CO-HOST: The Republican plan -- (UNINTELLIGIBLE) Groucho Marx or maybe Herbert Hoover -- they don't understand what the Democrats get. If you put cash in the pockets of working people, they're going to spend it. That will stimulate the economy and make us all richer. What's wrong with that?

NOVAK: That is a bad idea, and it's been proven that it doesn't work many times. You may as well go up in a plane and just throw the money out. Whoever gets it can spend it.

BEGALA: Well, what the Democratic plan actually would do is create jobs. It would boost the economy, which of course, has been sagging ever since President Bush took us from surpluses in growth to deficits and stagnation. The heart of the democratic plan is this: an immediate $300 tax rebate for every working American, not merely the rich.

Democrats also plan to aid States whose budgets have been strained by homeland security and Medicaid costs. They'll also cut taxes for small business, but not for huge multinational corporations. All for a total cost that's about 25 percent of the $600 billion Bush proposal.

Republicans understandably were upset. They complained that the Democratic plan would put millions of Americans back to work without handing hundreds of billions of dollars to the rich. Analysts say that to gain Republican support, Democrats may have to consider giving more handouts to the rich and screwing at least some of the poor.

NOVAK: Well, as you know, Paul, I suppose you're trying to be funny, and failing as usual. But, of course, they didn't say that at all. What you don't want to admit is that the top one half of one percent of the taxpayers pay 28 percent of all income taxes. That's the way this is redistributed right now, and it is really -- this is trying to correct it just a little bit.

Senator John Edwards of North Carolina, a fabulously rich trial lawyer, began his presidential campaign last week as champion of what he called the regular people. That didn't sit well with a potential rival for the Democratic nomination, Senator Joseph Lieberman of Connecticut.

"The Washington Post" quotes Lieberman as saying that, as a vice presidential nominee in 2000, he really didn't like Al Gore's theme of the people versus the powerful. Indeed, Lieberman says painting America as us versus them may have turned off swing voters against the Democrats. Will Joe Lieberman be the irregular candidate? Is he asking Democratic politicians to abandon the class warfare that they love so dearly?

BEGALA: Those are very good questions. My question is, why isn't Joe Lieberman on this program to answer them? I hope he's not chicken. I hope he's got the guts. Because if he's not tough enough to stand up to Bob Novak, he ain't going to be tough enough to stand up to Saddam Hussein.

NOVAK: He may not be tough enough to stand up to Paul Begala.

BEGALA: I'll tell you, I love Joe Lieberman, but he ought to come on this show. Most of the other Democrats running have been here. And, as we know, the road to the White House runs right through CROSSFIRE.

Well the crisis in North Korea has gotten so bad that this afternoon President Bush was forced to declare at a cabinet meeting, "The US has no intention of invading North Korea." Could it be that this entire crisis was caused in part by a rhetorical flourish in last year's State of the Union address?

Well, the "New Yorker's" Rick Hertzberg poses that question, citing a new book by former Bush speechwriter, the man who wrote the phrase "axis of evil" for President Bush, David Frum. Mr. Hertzberg says that adding North Korea was "a (ph) rhetorical affirmative action bussed in to lend adversity to what otherwise would have been an all- Muslim list." Hertzberg and others suggest that Bush's policy of hot but empty rhetoric, disengagement from North Korea and contempt for South Korea, were essential elements in causing the current crisis.

Mr. Bush's answer: the fact that a psychotic communist maniac in North Korea may have nuclear weapons is to remind us that Saddam Hussein is an evil, evil man. A lot of good that does.

NOVAK: You know, Paul, unlike you, who can find nothing good about George W. Bush, I don't find nothing bad about him. I think that was a mistake to let the speechwriters run away with a policy. But I do believe there is no point and no intention of attacking North Korea and starting a second Korean War. And I'll bet you agree with me.

BEGALA: I do. But it is a sad state when our president has to declare that.

NOVAK: The Reverend Al Sharpton, who has spent his political career in Harlem, took his presidential campaign on the road to Boston. His first event in a black neighborhood drew only 75 people. Those thousands that stayed away couldn't claim being caught in traffic. The reverend was 90 minutes late for his own event.

Democratic big leagues are chortling because Al Sharpton is their worst nightmare, or at least the worst since Jesse Jackson. About 40 percent of Democratic voters in the south are African-Americans. If they vote their race, as they often do for Sharpton in a crowded field, the rev (ph) could sweep the southern primaries. And, Paul, a lousy turnout in Boston Saturday doesn't diminish the Sharpton danger.

BEGALA: The only Sharpton danger is that you're going to be his campaign manager, Bob. He got no support in the Democratic -- he supported Al D'Amato, a Republican for the United States Senate, in his home state. You know he's just not a credible candidate. He's a lovely to come on as a guest on this show. I love having him on, but he's not a serious candidate.

NOVAK: You're whistling past the graveyard because the serious Democratic politicians I talked to privately are scared to death.

BEGALA: They ought not be. They should have a little more spine.

The Republican National Committee announced today that their annual -- rather quadrennial 2004 convention will be held in New York City. New York is of course the city where Bill Clinton was nominated for the presidency, where Al Gore got 78 percent of the vote, and the epicenter of the evil bicoastal blue States that went for Gore. So why would Bush choose Sodom on the Hudson?

Well, the smart guys at the ABC political note (ph) say it is to link Mr. Bush to September 11. Of course, President Bush was nowhere near New York on September 11. He was inside a mountain in Nebraska. Perhaps that's where he belonged, but for Mr. Bush to trade on the murder of 3,000 Americans for political gain is sad and sick. After all, FDR didn't have his 1944 convention at Pearl Harbor.

NOVAK: Paul, as an old friend -- am I an old friend? As a friend, I want to tell you how sick people are of you of denouncing George W. Bush on every story, even the announcement of a convention site. And I remember well when George W. Bush, not long after September 11, went to ground zero and inspired America. I think you should be a little more fair to our president.

(APPLAUSE)

BEGALA: I think I'll attack and criticize this president every single day he's in office because he is screwing up our country. And there is still a democracy; I still have a first amendment right to criticize the president.

NOVAK: I think you're hutting your own cause.

President Bush unveils his new economic plan tomorrow in Chicago. The Democrats tried to upstage him a few hours ago with a plan of their own. They did not build confidence. The press conference started, surprise, surprise, 13 minutes late, and they didn't have any of their flip charts. And they didn't have any new ideas either.

First in the CROSSFIRE tonight are Democratic Congressman Robert Menendez of New Jersey. He's chairman of the House Democratic Caucus. And US Senator George Allen of Virginia, a member of the Senate Republican leadership. (APPLAUSE)

BEGALA: Senator, good to see you. Thank you all both. This is terrific for you to take the time. I know Congress is back. You're both busy men in the leadership of your parties.

Senator Allen, I wanted to begin by going through the democratic plan that Mr. Menendez and others put together, but I couldn't resist. I want to play you a sound bite, a piece of videotape, of our president. One of my rules at CROSSFIRE is anytime George W. Bush speaks without a script, I pay close attention, because that's what he is really thinking.

Here's what he said today in a meeting of his cabinet. Take a look.

(BEGIN VIDEO CLIP)

GEORGE W. BUSH, PRESIDENT OF THE UNITED STATES: Listen, we're doing fine. Tomorrow you'll hear me say this economy is one of the strongest in the world.

(END VIDEO CLIP)

BEGALA: Well, Senator, one of the strongest in the world? I mean, your father was the legendary -- one of the greatest coaches. You inducted him into the hall of fame with one of the greatest speeches I ever saw. Did your father ever say it would be OK if the Redskins were one of the best teams in the NFL? Don't we (UNINTELLIGIBLE) the strongest economy in the whole world?

SEN. GEORGE ALLEN (R), VIRGINIA: Well, we have a very strong economy and it needs to be stronger. The president recognizes there are a lot of good people across this country who would like to find work. And we would like to find ways to stimulate job creation.

And so you can never be satisfied with being the best. You want to be the best, but we clearly can improve.

BEGALA: But there is some disconnect when he says -- if he was -- he's a very bright man. If he was as articulate, perhaps, as you were just then unscripted, he would be in better shape. But he said we are just doing fine. Now this is a contradictory -- if we're doing fine, why does he want to spend $600 billion of our money to help the wealthiest five percent?

ALLEN: Because we need to do better. There are several things here. I think it is unfortunate when people are always talking about how awful this country is, how awful it is for jobs and investment, and that doesn't help. That doesn't help with psychology for investment or recruiting new jobs into this country if your own CEO is running down your country.

He recognizes we may be doing fine, but we can do much better. And I think that the president's plan that will be unveiled tomorrow will be very helpful for all taxpayers. It will be helpful for families, for married couples. It will be helpful for senior citizens. And it will be particularly helpful for those who create most of the jobs, and those are the small business owners.

NOVAK: Congressman Menendez, congratulations on your election. That was for chairman of the Democratic Caucus. You didn't unveil your plan until today. But Senator Don Nickles of Oklahoma, chairman -- new chairman of the Senate Budget Committee, Republican, must have got an advance look at it. Because yesterday he previewed just what was going to happen. Let's take a look at what Senator Nickles said.

(BEGIN VIDEO CLIP)

SEN. DON NICKLES (R), OKLAHOMA: Some people always want to play class warfare. If you're going to have tax cuts, it would make sense to have tax cuts for taxpayers. And so whoever is paying taxes should get tax cuts, period.

(END VIDEO CLIP)

NOVAK: Now this is -- I want you to explain this to me. You're coming out with what you call a tax cut plan. Of course, 37 percent of Americans don't pay any income tax. And what you're going to do is take money out of the Treasury to people who don't pay taxes and give it to them. You call that a tax cut?

REP. ROBERT MENENDEZ (D), NEW JERSEY: I think you're not talking about the same plan we unveiled today, Bob. The fact of the matter is, we take individuals who are working and couples who are working and we give them up to 10 percent of the first $6,000 that they've earned. And we give them a tax cut.

So up to $600 for a couple, $300 for an individual. For those individuals who had been working and lost their job -- the two million jobs that we lost under President Bush -- we say to them, as you are seeking that job, and you still need to sustain your family, we'll give you the opportunity to sustain yourself and your family as you continue to seek that employment by extending the unemployment insurance efforts. So what we seek to do, in those two regards, we give tax cuts to individuals, all Americans, we give tax cuts to couples. We give an opportunity for those who are seeking to find work but cannot find it simply because we've lost two million jobs under this presidency.

We give tax opportunities for small businesses and all businesses under our provisions in expensing, in deductions, in accelerating in investments in 2003. And finally, we give monies to all Americans living across this land in states by helping them on homeland security, by helping them on Medicaid, by helping them in critical infrastructure needs. And that $136 billion, Bob, in 2003, is what this is all about. It is about stimulating the job market, not just necessarily stimulating the stock market.

NOVAK: Congressman, you are certainly -- you certainly are entitled to be a Democrat and to like to do things that Democrats like to do. I'm just talking about labeling. When you're giving -- putting out money for people who aren't working -- just a second...

(CROSSTALK)

MENENDEZ: ... and I say get $600 for a couple, they're working, Bob.

NOVAK: I mean, in addition to that -- and you're giving money to the states, to pay poor people for healthcare. Those may be good programs; we can debate that. But they're not tax cuts. You can't call them (UNINTELLIGIBLE).

MENENDEZ: Part of them are tax cuts. Those individuals who are working, the $300...

NOVAK: I know, but the stuff I'm talking about.

MENENDEZ: And the other part is stimulus.

NOVAK: Stimulus, oh.

MENENDEZ: The only way to stimulate the economy isn't through the double taxation of dividends that you want to give relief for, which ultimately will maybe hurt the economy by having those individuals -- those companies say, you know what, I'm not going to make investments, I'd rather give dividends. And when we look at dividends, average Americans, the 82 percent of taxpayers across the country, who are under $75,000 or under, they're going to get about $24-$40 some odd dollars.

And, however, that other point two-tenths of a percent, they're going to get in the $30,000 range. And ultimately, average Americans don't have the dividend issue because, to the extent that they have stocks, they have it in retirement funds for which they don't get dividends. So the real stimulus is about creating jobs in 2003.

NOVAK: I think -- I can answer that, but go ahead.

BEGALA: I want Senator Allen to answer. First off, half of us don't have any stocks at all. So a dividend tax cut doesn't help us.

ALLEN: Which means half the people in this country do own stocks.

BEGALA: Yes. And god bless them. They get a tax cut. But what about the other half? They get nothing.

It seems to me (UNINTELLIGIBLE) the Democrats have targeted tax cuts up and down the line. Everybody gets it. But the bang is where middle class consumers are. And I'm curious, do you believe the economy is more driven by wealthy investors like Novak or by middle class consumers like my grandmother?

ALLEN: It's by everyone in this country. People buying products, small businesses.

BEGALA: Why cut taxes that only half of us pay? ALLEN: No, the point -- let's go through all since we listened to the Democrats' plan here. As far as dividends are concerned, half the country -- half the people in this country owns stocks. Predominantly, in fact, a majority of that income is by retired people, whether it is in their pension plans, retirement plans and so forth. And, indeed, if you look today on the stock market, "Stocks Rally As Bush Plan Lifts Hopes." That's good. That's good for shareholders...

NOVAK: 171 points.

ALLEN: 171 points. And the point is that actually helps the states. The states in the retirement systems, they have to fund it for their state employees, teachers, and rank and file employees. That helps the state governments and their budgets.

The other thing that you'll see in President Bush's plan that will be unveiled tomorrow is acceleration of tax cuts for taxpayers, all taxpayers. It's especially going to be helpful for those who are married because it is accelerating the relief from the marriage penalty tax. He's going to accelerate also the child tax credit from $600 to $1,000 per child.

So if you have a family that makes $39,000 a year and has two children, they're going get relief of about $1,100 to $1,200 a year. This year and the next year and thereafter. That is going to have a great stimulative impact on that family, as well as you have the expensing, the $179 expensing, dandy, it is OK. President Bush is...

BEGALA: That's a tax cut for businesses...

(CROSSTALK)

ALLEN: For small businesses. It is a good one. But you know what? President Bush is going to be -- instead of doubling it, we're going to triple it, which will really help small businesses.

NOVAK: Congressman...

(CROSSTALK)

MENENDEZ: ... fiscally sound, and that's something that the president isn't. The president's plan is too little too late and it is too irresponsible over the long term.

NOVAK: Congressman, I want you to address what the senator said. The senator said that this family making $39,000 a year with two earners, four children, a family of four, two children, gets $1,100 in tax relief. Now, under your plan, they get $600. How can you go before the American people and say the middle class benefits from yours and it doesn't benefit from theirs?

MENENDEZ: The child tax credits that are upcoming they would still receive. Ours are $600 in addition to that which they would still receive anyhow. So if you want to lump them together, ours is even higher. I'm talking about new money, new stimulus in 2003. NOVAK: This is new. This $1,100 is new. This is new.

MENENDEZ: That is aggregate. There's a difference.

ALLEN: And it won't just be for this year, it will be for next year as well, because most people would like...

NOVAK: Why do you cut it off after one year?

MENENDEZ: Because we need to be fiscally responsible. If you continue to go where this administration is headed, which has already squandered $5 trillion, you are putting around the next generation of Americans an incredible yoke of debt, and that debt means interest payments and billions of dollars in interest payments, as my dad used to say, is feeding a dead horse.

It doesn't make sense. It doesn't make sense for this economy. Bill Clinton and Democrats showed that when you balance the budget, when you're able to have low interest rates, low unemployment, low inflation, you have the greatest peacetime economy and also...

(APPLAUSE)

ALLEN: And also tax Social Security.

BEGALA: Let me read to you what some experts who have analyzed the proposed Bush plan before it was released, so it may be different. You know, we never know. But "The New York Times" talked to some experts, propeller heads, who looked at this. And this is what they said.

"Under the Bush plan, the tax benefits flow almost exclusively to the very wealthiest taxpayers because they are the ones who receive most dividends. Calculations by the Tax Policy Center, a nonprofit research group run by the Urban Institute and Brookings, shows that about 64 percent of the benefits will go to the wealthiest five percent of the taxpayers." Now isn't that why yours is $600 billion instead of $136 billion, because you've got to give 64 percent of the benefit to five percent of us?

ALLEN: No, that's incorrect. If you only look at the dividends, again, half the people in this country own stocks. Out of those -- if you look at the income from dividends and companies, whether it is General Electric, General Motors, Norfolk Southern (ph), utility companies and so forth, it's predominantly senior citizens. They are not generally wealthy people.

They're also not factoring in the acceleration of the child tax credit per child. They're also not looking at the marriage penalty tax or the reduction or the acceleration of reductions in income tax rates.

NOVAK: But the Urban Institute is hardly an objective source.

ALLEN: Well, the point is...

(CROSSTALK)

BEGALA: Right, they say...

(CROSSTALK)

ALLEN: ... it is hard to make sure and find out the details of the president's plan. We'll know tomorrow. I was able to talk to him in preparation here. And so when you see the whole plan, I think that you'll see how specious and incorrect that...

BEGALA: Well, we will run the numbers again (UNINTELLIGIBLE). If you could hang on just a second, both of you, though, because -- first, a quick reminder. Before we take this break, CNN will have live team coverage of President Bush's economic speech beginning tomorrow, 1:00 PM Eastern. And, in a minute, we will ask our guests about some of the other hot button congressional issues, including human cloning and North Korea. Not together; two different issues.

Speaking of (UNINTELLIGIBLE), KFC original recipe, hot and spicy, extra crispy, or maybe with an order of vegetarian-boost guilt. We will talk to the man who (UNINTELLIGIBLE) targeting, Colonel Sanders.

And then, the Republicans decided to hold their convention in a nice liberal city in a good Democratic state and I couldn't be happier. Stay with us.

(APPLAUSE)

(COMMERCIAL BREAK)

BEGALA: Welcome back to CROSSFIRE. It's a brand new world here in Washington, with Republicans in control of both Houses of Congress and both ends of Pennsylvania avenue. With nowhere to hide and no one to blame, will the GOP succeed? To debate that topic in the CROSSFIRE, Republican United States Senator George Allen of Virginia and House Democratic Caucus Chair Bob Menendez of New Jersey.

NOVAK: Mr. Menendez, we have had the (UNINTELLIGIBLE) or whatever the hell they are talking about claiming of clone (ph) to babies. Whether that is true or not, this is a scary prospect. Isn't it time for Congress to make cloning of human beings illegal? And no worry about embryonic stem cell research. We can do adult stem cell research and have great progress. Forget about trying to satisfy the pro-abortion movement and get rid of this.

MENENDEZ: Well, I think that we had that opportunity. I think that there is a bipartisan will in the Congress to ban human cloning. But it cannot be combined with the right wing -- with -- it cannot be combined with the pro-life forces who want to insist that we can't do therapeutic cloning. That we can, in fact, have the embryo research that we can ultimately achieve enormous advances on Parkinson's and on so many other diseases.

So I certainly believe that there is a bipartisan will to ban human cloning. But we have to ensure that that legislation doesn't have what the pro-life forces want, which is in essence to undo our ability to do embryonic work to relieve the affliction of millions of people in this country, Bob. And that, the American people want to have the opportunity. They want the opportunity to have the shot on Alzheimer's, on Parkinson's.

They want for those who have brain injuries and for those who have had spinal cord injuries to have the opportunity to have a new shot at life. And that is the fundamental issue.

(APPLAUSE)

BEGALA: Let me turn it around. Senator Allen, I think Congressman Menendez is clearly right. Both parties agree we should ban reproductive cloning. Cloning of babies to make babies. Why not take that great moral consensus and pass it into law, instead of allowing the politics of abortion to intrude and getting tied up on trying to ban therapeutic cloning, which many people disagree with? But everybody agrees with banning human cloning. Why didn't your party do that?

ALLEN: I think you're all getting this confused. That's part of the problem. I think we all agree that human cloning should be prohibited.

The so-called therapeutic human cloning is very close to human cloning and easily manipulated into human cloning, even though it is called reproductive cloning or therapeutic. Now, the issue of using stem cells from embryos, I'm very much in favor of research on stem cells from embryos for Parkinson's, for juvenile diabetes, Alzheimer's and so forth. Not exactly where Bob is on that one.

And I think that from those embryos that could otherwise be discarded or destroyed, I think that we should go forward and research in that area. The research, as far as adult stem cells and tissue stem cells, I think we should go forward there as well. And so I think where the consensus needs to be is, number one, an understanding of the definition, the science and what we're doing.

Human cloning should be banned. But it should not stop research on embryos -- stem cells from embryos that can be possibly helpful. It is only a prayer, it's only a hope. Some people say that it is not proven. Well, let's do the research under ethical guidelines.

NOVAK: Congressman Menendez, let me ask you another non- controversial (ph) area, and that is the University of Michigan has a quota system on admissions. The Supreme Court is considering that. I want to ask you a question I asked Bill Clinton in 1992. He wouldn't give me a straight answer. I hope you will. Are you in favor of racial quotas?

MENENDEZ: I'm not in favor of any quotas. I am in favor for the opportunity, and I hope the Republican Party, post Trent Lott, will show us by actions not by words that, in fact, they believe that every American, regardless of the color of their skin, regardless of their ethnic background, regardless of their agenda, has the opportunity to fulfill their achievements in this country. But what we do need is to affirmatively act to ensure that, in fact, there are no barriers to any American achieving their god given opportunities.

(APPLAUSE)

BEGALA: Senator, let me kind of turn that a little to the personal side of Capitol Hill. You were the man who called Trent Lott and told him it was time to go. It could not have been an easy thing to do. Now that he's back -- he's a colleague and still a very powerful senator -- he's pledged to support affirmative action. How is he being received by you and the rest of his colleagues?

ALLEN: We haven't gotten back together again. We'll see tomorrow, when we're all together, the swearing in of the new senators and our majority and moving forward. We're going to move forward tomorrow hopefully and pass an unemployment benefits package tomorrow. You're going to see action with the Republican majority now.

BEGALA: But it's going to be a tension convention.

ALLEN: It will. Yes it will. It will be for me personally. But nevertheless, I think we made the right decision. Bill Frist will give an accurate portrayal of our sentiments and our views and our agenda for the American people. All the people.

NOVAK: And that has to be the last word. Thank you very much, Senator George Allen, Congressman Bob Menendez.

(APPLAUSE)

NOVAK: All you doubters about cloning finally have a chance to say we told you so. Connie Chung has details next in a CNN NEWS ALERT. And then they're both in the Northeastern cities, but they sure aren't clones. We'll debate which party made the better choice for its 2004 presidential convention. Plus a big helping of hot air when the people who don't care how your chicken is cooked, just how it is killed.

(COMMERCIAL BREAK)

NOVAK: The Republicans today opted for post-September 11 symbolism and picked New York City instead of New Orleans or Tampa-St. Petersburg as the site for their 2004 presidential convention.

The Democrats already selected Boston which carries a symbolism of all its own. Teddy Kennedy, Michael Dukakis, John Kerry, ultra liberals all. So who's going to have a better time?

To help us put Beantown and the Big Apple in the CROSSFIRE, we're joined by Democratic Congressman Ed Markey of Massachusetts and in New York, former Republican Congressman Rick Lazio of New York.

(CROSSTALK)

BEGALA: Rick, it's good to see you. Congressman Markey, thank you to you, too.

First, let me congratulate Rick Lazio, your party, on picking a great American city, New York. Let me tell you one of the many things I like about it. Hillary Clinton got about 73 percent of the vote in New York City against you, Rick. You got about 26 percent. Our president did much worse than you. George W. Bush only got 21 percent in New York City.

So why are the Republicans moving to left here, Rick?

RICK LAZIO, FRM. U.S. REPRESENTATIVE: It's shows great confidence in support for New York City. I think it is a tremendous decision by the Republican National Committee and national Republicans and President Bush to come to New York to show support, as he has been showing such extraordinary support since September 11 of last year.

This is a great city. The strongest, most vibrant, most diverse city in the world. Over one-third of New Yorkers are born outside of America. So it is showing support for that level of diversity.

And you couldn't find a city that is going to provide better rooms, better facilities, more fun, better transportation than New York. I think it is a terrific decision.

And the city, by the way, that is governed by a Republican mayor, in a state that is governed by a Republican governor, that has over 2 million more Democrats in New York. So you have Democrats voting for Republicans and I think that's exactly the path that Republicans and George Bush are looking for.

NOVAK: Congressman Ed Markey, explain the Democrats to me a little bit. I think a lot of people think that their hopes are in the center but you name the most left-wing person as you can for the leader in the House. And then you have picked the city that is considered the most left-wing city, maybe next to San Francisco, but certainly a state which even, my goodness, even George McGovern managed to carry when he ran for president. Where are you people going?

REP. EDWARD MARKEY (D) MASSACHUSETTS: We're going to best city in the United States. And it's the birth place of freedom, Lexington Green, Plymouth Rock, the Kennedy Compound, all of these magical, historical...

NOVAK: This sounds like an exciting place.

MARKEY: Well for Democrats it will be and we'll be bouncing out of that convention with a huge momentum because Democrats are going to have the best time they've ever had.

Remember, the Republicans put the -- they're convention in the year 2000 in Philadelphia and who won Pennsylvania, Al Gore. So predicting the November election based upon where the convention is really is foolhardy. We're just going to give the best possible springboard for the Democratic Party in Boston as the place to be.

BEGALA: Congressman Lazio, former Congressman, let me ask you about one point. I agreed everything you said about the city and immigrants and it is a terrific gesture. But I was intrigued because I think you're following the Republican Party talking points.

In the first ten seconds, you mentioned September 11. Isn't it sad, isn't it shameful, I said this earlier in the program, to trade on the murders of 3,000 people for partisan political ends?

LAZIO: I think we are showing support here. The Democrats had the opportunity to show support for New York City.

Democrats support New York City, too. I'm not saying that Democrats don't support New York City. This is just a decision by the Republican National Committee to give New York in a shot in the arm. They are saying this is about -- amount to about 100,000 room nights during August which is a very slow time and a time that New York City needs it.

And I think it is terrific for Republicans throughout the country to come to New York City to see the beauty of New York, to show New York off, to be in the national spotlight and to leverage that great publicity for the benefit of New York. I'm very proud of my party for deciding to come to New York.

NOVAK: You know, Ed Markey, I happen to like Boston. I was, many, many years ago before you were born, I was stationed at Fort Devons, and we spent a lot of time in Boston.

But have really you messed up that city lately. I think the delegates are going to be stunned by the Big Dig. Let me read you what Jane Holtz Kay, the architecture critic of "The Nation," which is a left-wing magazine said. We'll put it up on the screen.

"To this date, neither the completion date, December 2004," talking about the Big Dig, "nor the official assertion that the construction is `83 percent complete' is certain. And, as the digging and heaving, bulldozing and backhoeing of the project continue. Bostonians recall Representative Barney Frank's early comment that it would be `easier to elevate the city than to lower the central artery.'"

You made a huge mess of that, haven't you?

MARKEY: Well, but it's going to be ready for 2004. And not only that, we even named the Big Dig after one great Republican, Ted Williams. On the other hand -- and it's the greatest transportation -- construction project in the history of the world.

NOVAK: The longest.

MARKEY: But it is going to be ready and people will be able to move around the city.

Meanwhile, the Republicans are going to New York. And while they used to be the party of Lincoln, for 2004 they'll be the party of the Lincoln Tunnel. And for one week it's going to be one huge big gridlock, not Big Dig.

And unfortunately when those limousines with wealthy Republicans are packed cheek to jowl along the streets of New York, no Republican yet has proven that they know how to use a subway.

So unfortunately they're never going to be able because they don't know how to work in such small denominations and I'm afraid this convention will be a disaster for Republicans. Although it's a great city, New York.

BEGALA: Rick Lazio, let me ask you, they going to retro-fit the subways to take $100 bills? Because that's all those Republicans carry.

LAZIO: I take the subway every day. I think Ed is a little bit bitter because the last bounce they got for the Boston Red Sox was before World War I, and the Yankees have been 26 straight championships. They're still bitter that Babe Ruth came to New York. You know, I don't think New York needs 10 years to dig a tunnel or bury a road. We're in great...

NOVAK: Can I just ask you a political question?

LAZIO: I mean, where would you -- where would you guys rather go? Would you rather go to a city that is called the Big Apple or a city called Beantown?

(CROSSTALK)

MARKEY: I have a response to this. Boston gave the Yankees Babe Ruth. We gave them their mayor, Mike Bloomberg. He's from Boston as well.

LAZIO: That shows you how smart you guys are.

MARKEY: The philosophy of the Yankees and George Steinbrenner is buy the best team you can afford. And the Republican philosophy is buy the best government that is available as well.

LAZIO: Ed, 26 championships, 26 championships.

(CROSSTALK)

MARKEY: Yankees are the Republican baseball team.

(CROSSTALK)

LAZIO: I hope you guys get the same balance that you give the Red Sox, that's all I have to say. We'll take the same balance that we give the Yankees.

NOVAK: I've got to ask you one political question, Ed Markey.

MARKEY: Sure.

NOVAK: You have one of the most Democratic states in the union. You have -- the Republicans have just won the governorship for the fourth straight time. Four straight elections, that's for 16 years. Are you guys doing something wrong up there? MARKEY: I think at the end of the day, because we control 90 percent of the House and the Senate, the tradition has always been you need one Republican in some elected office, OK, to just keep an eye on everyone else.

(CROSSTALK)

MARKEY: But we wouldn't go beyond that. Every other office at every other level is controlled by the Democrats, and it will always be thus.

BEGALA: Well, let me ask Rick Lazio a political question. Your Republican governor was reelected. I saw some of the commercials. I like to go fish up in the Catskill Mountains, and he ran ads, never mentioned he was a Republican, and he was calling for repealing drug laws. Your mayor, a Republican, is a contributor to Hillary Clinton, and he supports gay rights and higher taxes. Is that the future of the Republican Party? Because if so, sign me up.

LAZIO: You know, you've got two Republicans who do reach out to minorities, who reach out to Democrats and independents, and have been very successful and have learned to govern from the center. And they're widely supported by both Republicans and Democrats. And I think their levels of popularity reflect that.

BEGALA: Rick Lazio, good guy, good Republican. Thank you.

MARKEY: Can I just say this, Paul. I hope the Republicans don't follow through on their plan to turn Central Park into a golf course for their wealthiest contributors, OK? I think that's a terrible signal to send.

BEGALA: That will have to be the last word. Congressman Ed Markey.

(CROSSTALK)

BEGALA: Thank you, Rick, from New York.

Coming up in "Fireback," one of our viewers suggests a new year's resolution for me.

But next, the animal rights people have something for you to chew on the next time you order a triple crunch zinger chicken sandwich with sauce. Stay tuned and find out what it is.

(COMMERCIAL BREAK)

BEGALA: Welcome back to CROSSFIRE. We're coming to you live as we always do from the George Washington University here in beautiful downtown, snowy downtown Washington, D.C.

The group called PETA, People for the Ethical Treatment of Animals, is at it again. Today it began a global boycott of KFC, which most of us still remember as Kentucky Fried Chicken. The group says it's hoping to improve the lives and ease the deaths of millions, not KFC customers, but millions of chickens that are on KFC's menu.

Stepping into the CROSSFIRE from the hometown of KFC, Louisville, Kentucky, Bruce Friedrich, he's PETA's director of Vegan Outreach. Mr. Friedrich, thank you for joining us, sir.

BRUCE FRIEDRICH, PETA'S DIRECTOR OF VEGAN OUTREACH: My pleasure, gentlemen. Thank you.

NOVAK: Mr. Friedrich, Kentucky Fried Chicken declined to come on the program, but they did supply us with this statement which I'd like to read.

FRIEDRICH: Please.

NOVAK: "KFC denies PETA's claims. KFC is committed to the well- being and human treatment of chickens, and require all of our suppliers to follow welfare guidelines developed by us with leading experts on our Animal Welfare Advisory Council. Our suppliers are receiving unannounced audits at their poultry facilities throughout the year. Failure to comply with our strict guidelines would result in termination of our supplier agreement if remedial action is not taken." What's wrong with that statement?

FRIEDRICH: Well, KFC suppliers, in fact, boil chickens alive. They sear the beaks off of parent birds with a hot blade which is so painful that many of them starve to death. They genetically breed the animals. If a seven-pound baby grew as quickly as a KFC chicken, she'd weigh 1,500 pounds before she was six months old. The list of categorical abuses of these animals is very, very lengthy.

And the reason KFC has declined to come on is that when journalists asked for those very farmed animal welfare standards that you mentioned in that statement, they don't have anything that they can supply. In fact, what KFC does to animals -- and we detail this and have a video on our Kentuckyfriedcruelty.com Web site. It's just www.kentuckyfriedcruelty.com. What they do to animals, if they did to dogs and cats, KFC executives could go to jail for felony cruelty to animals in more than 30 states.

BEGALA: But Mr. Friedrich, forgive me if a take a bite here, because this -- it's pretty tasty chicken. And people vote with their mouths. They vote with their hands. (UNINTELLIGIBLE), one of our production assistants is in the audience -- who wants some chicken right now? He has got a bucket. Now, this is after hearing your pitch. Is it -- could it be that you're not helping your cause very much?

FRIEDRICH: Well, I think a picture is worth a thousand words, and if people could see these animals fully conscious, boiled alive, having their throats slit open while they were still conscious, they could see the animals on these factory farms. I mean, each chicken has about that much space for his or her entire life with the wing span of this. These animals are denied everything that's natural to them. They're more intelligent than cats, they are as intelligent as dogs. They want to spend time with their families, they want to dust bathe, they want to breathe fresh air. KFC denies them everything that is natural to them and categorically abuses them in ways, again, that if this were done to dogs and cats, felony cruelty to animal charges would ensue.

NOVAK: Mr. Friedrich, let me quote Richard Lobb of the National Chicken Council. I didn't even know there was a National Chicken Council, but I'll quote them anyway. He says: "PETA's objective is not to improve animal welfare, but to eliminate the use of food from animal sources. A proper concern for animal welfare is already well established in the broader chicken industry." Isn't it true, Mr. Friedrich, that you're not -- what you're interested in is eliminating all eating of meat, of chicken, of anything like that? Isn't that what your real goal is? Not to worry about the poor chickens.

FRIEDRICH: Well, with this campaign what we're trying to do is improve the welfare of these chickens on farms, during transportation and end at slaughter. The chicken industry uses three times as many drugs, three times as many antibiotics on chickens as are used on beef cattle, as are used on human beings in this country from the pharmaceutical companies.

Wait a minute, let me finish. They do that because otherwise the animals would be keeling over dead from heart attacks and lung clouts and crippling leg deformities. They have to keep the animals drugged up with three times the amount of antibiotics as we take as human beings so that they don't all die in their short two-month lives.

NOVAK: Please answer my question, sir. Are you against eating of any meat products, any animal products?

BEGALA: Mr. Friedrich, I think we have briefly lost...

NOVAK: We lost him.

BEGALA: We lost contact with Mr. Friedrich.

NOVAK: All right, let me ask you -- are we connected again? I don't think so.

BEGALA: Well, as you can tell -- I was going to say maybe squirrels got into the system, maybe chickens did. I don't know.

Seriously how many here -- now you heard the spiel. And, you know, there's a lot of good-hearted people that are concerned about this. Can we find nobody in the audience who now is going to be vegetarian?

This -- OK, this woman is.

NOVAK: Just one conversion. See.

BEGALA: The rest of us are going to be eating the chicken. I have to say, even as a liberal, I -- you know what? I love chicken. I loved fried chicken.

NOVAK: How many of you are eating chicken. Applaud. You know, I always -- I always thought that the purpose -- every body has a purpose. I haven't figured out what your purpose is yet, Paul.

BEGALA: To annoy you.

NOVAK: But I think all chickens have one purpose and that's to provide good meals.

BEGALA: Well, I was moved. I really hope we get the satellite back because I would like to ask Mr. Friedrich about this notion that chickens want to spend more time with their families. That was a -- that was sort of...

(CROSSTALK)

BEGALA: They're packed into close quarters there. I'm sure there are issues they're trying to raise.

NOVAK: OK. All right. Well, we're sorry that we lost our connection to I guess the chickens -- well, we get into that.

BEGALA: Came home to roost.

NOVAK: Came home to roost. Yes.

Next in "Fireback," how soon they forget. I have to explain Marxism to one of our viewers.

(COMMERCIAL BREAK)

NOVAK: It is time for "Fireback", when the viewers get to "Fireback" at us.

The first e-mail is from Ellen Remore of Old Tappan, New Jersey. She writes, "I have recently become addicted to your program and I believe that both Mr. Begala and Mr. Novak are eloquent spokesman for their respective viewpoints. However, I question Mr. Novak's persistent use of the use of the "Marxist."

Ellen, being from New Jersey, you ought to know Marxist very well. It's full of them. And, in fact, if old Karl Marx were suddenly to come back to Earth today, he would say, my God, everything I have worked for almost has been put into effect, including his greatest invention, the steeply graduated income tax which penalizes the successful and rewards the unsuccessful.

BEGALA: Of course, I take my inspiration on supporting a high income tax for the rich, not from Karl Marx but somebody who predated him, Jesus Christ, who said, "Of those to whom much has been given, much will be expected." That should be our tax policy as well as our religious policy.

NOVAK: You know, as a good Christian I think you should know what Jesus Christ said about the tax collectors.

BEGALA: He said, "Render unto Caesar what is Caesar's." He said, Shut-up and pay your taxes. That's what he said.

NOVAK: He was against the tax collectors.

BEGALA: No.

Betty Jean Ledbetter of Marietta Georgia writes, "Hi Paul. I am 75 years of age and somewhat housebound. I never miss CROSSFIRE. You've given me so many pleasant hours of being listen to someone who stands up for his principles, has a superb sense of humor and instant wit. Keep it up, Paul. You're a keeper."

Betty Jean, thank you. That's awfully nice. That's killing Novak.

NOVAK: Why don't you refer to her as Aunt Betty Jean?

BEGALA: Aunt Betty Jean. OK.

NOVAK: OK.

D.W. MacKenzie of Fairfax, Virginia, says, "Bob, keep your fight against Mr. Begala. When I hear his comments on which presidents did the best job of running the economy and see how these comments resonate with the audience, I tremble for the future of this country. No president has ever had the authority to run the economy and hopefully none ever will."

NOVAK: D.W., you're right on. you're a good Virginian. But I will say this, Most of the audience -- don't worry about most of these audience. They are pampered, overeducated, undercivilized children going high tuition schools thanks to their rich parents. Don't worry about it.

BEGALA: Is that true of you guys?

NOVAK: Not this audience. Not this audience.

BEGALA: Oh, OK. These are kids at G.W. and other high school students. But we appreciate that, D.W.

Russ Clark in Charlotte, North Carolina writes, "OK, Paul. It's the new year now, and what a time to turn over a new leaf. Instead of your relentless Bush-bashing, night after night, how about offering up some fresh ideas that the Democratic Party could pursue? How about it Paul? Let's have a change."

Russ, that is a fair point. If you go buy my book "It's still the economy, stupid," you'll see a whole chapter about what Democrats ought to stand for. What it begins with is standing up to Bush.

I ain't going to stop, Russ. If you don't like it, tough luck, because Bush is in the office right now. He should be held accountable for what he does and the press corps have been too lazy in holding Bush to account.

NOVAK: You're really off a bad start in the new year. BEGALA: I ain't going to stop.

NOVAK: The same old Begala.

BEGALA: I ain't going to stop.

NOVAK: Question.

BEGALA: Yes, sir?

UNIDENTIFIED MALE: Yes. Gabriel Garros (ph), San Angelo (ph), Texas.

BEGALA: San Angelo?

UNIDENTIFIED MALE: San Angelo.

BEGALA: That's a great time. I love San Angelo.

UNIDENTIFIED MALE: Yes sir, it is.

Is it possible that President Bush wants to bring the Republican convention to New York City to bring money and the spirit of America to the great city, just like Senator Schumer and Senator Clinton wanted to bring the Super Bowl from San Diego to New York as a symbol of the American spirit?

BEGALA: I think that is a fair point. That is a good point. And in fact, I will say this for our president. He kept his word. Senator Clinton had to press him, but he kept his word on the $20 billion of aide to New York when others in his party wanted to bail out.

What I question, though is when Republicans like Rick Lazio tonight, the first thing they say is we want to associate Bush with 9/11 and I think that is unfortunate.

NOVAK: Well I'll tell you why he says that. Because Paul is pure politician and he is worried -- he knows that that association hurt the Democrats in the last election and he's fearful it will hurt him in the next one. So I know what you're doing, Mr. Begala. You can't fool me.

Next question.

UNIDENTIFIED MALE: I'm Tristan Sperling (ph) from Gaylord, Michigan and my question is, How can we justify affirmative action when we are in reality practicing reverse discrimination?

NOVAK: I think you're exactly right.

I asked Congressman Menendez if he was for the quota system and he wouldn't really give me a straight answer, just like Bill Clinton wouldn't give me a straight answer when I asked him face to face about it. Americans hate reverse discrimination and I hope that this president has the guts to go forward and support the white students who have been discriminated at the University of Michigan.

BEGALA: Yeah, right. At the University of Michigan, you get bonus points if your daddy went to the University of Michigan. How do you think Bush got in to Yale? OK? You get bonus points if you're from a certain part of the state. You get bonus points if you can play the tuba or run the 40-yard dash. But if you bring a diverse background, the way Clarence Thomas does to the Supreme Court...

NOVAK: All right.

BEGALA: Oh, that doesn't count?

NOVAK: We're running out of time.

BEGALA: Come on. Affirmative action is great.

NOVAK: Your question, please.

BEGALA: Yes, sir?

UNIDENTIFIED MALE: Josh Law (ph) from Atlanta, Georgia.

Does it surprise anyone that the party of big business, the GOP, is following the fiscal unresponsibility of its constituents? What happened to the premise of fiscal conservatism in the Republican Party?

NOVAK: I'll give you the answer. Big business has no party. They go whatever dog will hunt will hunt with them. The Republican Party is the party of small business.

BEGALA: Oh, please. The Democratic plan has a cut for small businesses in it. The Republican Party is now a wholly owned subsidiary of big business from Enron all down. Shame on them.

From the left, I am Paul Begala, good night for CROSSFIRE.

NOVAK: From the right, I am Robert Novak. Join us again next time for another edition of CROSSFIRE.

"CONNIE CHUNG TONIGHT" begins right now.

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