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JUDY WOODRUFF'S INSIDE POLITICS

President Bush Set for Middle East Summit; Tax Cut Fallout Continues

Aired June 3, 2003 - 16:00   ET

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

(BEGIN VIDEOTAPE)
ANNOUNCER: President Bush secures an Arab pledge in his push for Mideast peace, one hurdle cleared in Mr. Bush's drive for an Israeli- Palestinian settlement.

CONDOLEEZZA RICE, NATIONAL SECURITY ADVISER: This president will not back away. This is a president who is known for his determination.

ANNOUNCER: Now that the tax bill has been signed into law, what is the next big battle on Capitol Hill?

SEN. CHARLES GRASSLEY (R), IOWA: I'm confident we're going to get a bill through the United States Senate before the Fourth of July break.

ANNOUNCER: We'll look at a new fight over your prescription drugs.

JOHN HICKENLOOPER (D), DENVER MAYORAL CANDIDATE: We're trying to do four house parties every night.

ANNOUNCER: He's a political outsider with quite a political punch. We'll take a look at what's brewing in Denver's mayoral election.

(END VIDEO CLIP)

ANNOUNCER: Now, live from Washington: JUDY WOODRUFF'S INSIDE POLITICS.

JUDY WOODRUFF, CNN ANCHOR: Thank you for joining us.

At his meetings today with Arab leaders in Egypt, President Bush went to great lengths to emphasize the responsibilities facing both the Palestinians and Israel, if the U.S.-backed road map for peace is to succeed. The gathering at Sharm el-Sheikh served as a preview of tomorrow's planned meeting with Israeli leader Ariel Sharon and the new Palestinian prime minister, Mahmoud Abbas.

The high stakes at tomorrow's summit could also have a big impact on the president's political standing back here at home.

Let's go now to our senior White House correspondent, John King, in Egypt. John, some expectations are being watched very closely.

JOHN KING, CNN SR. WHITE HOUSE CORRESPONDENT: And, Judy, on the one hand, the president says, this will be a long and difficult, at times no doubt frustrating, process. On the other hand, we are told Mr. Bush is quite upbeat tonight.

He came here first to Sharm el-Sheikh, Egypt, to have his first face-to-face encounter with the new Palestinian prime minister, Mahmoud Abbas. That came this morning during the working sessions also attended by the leaders of Egypt, Jordan, Saudi Arabia, and Bahrain, many of those Arab leaders wondering: Will Mr. Bush put pressure on Israel, if necessary?

The president dealt with that immediately in his opening statement, saying Israel must act to deal with the settlements, Israel must negotiate a Palestinian state that the Palestinians can accept in the negotiations. Now, Mr. Bush, after the first round of talks, was actually seen driving a golf cart. He was quite happy with the sight -- the developments here today, the commitments he received from the Arab leaders, happy to be driving today, some questions as to whether he'll have that commitment when things get rough down the road.

His national security adviser, Condoleezza Rice, says, erase those doubts; Mr. Bush is in the process now and will be there when it turns tough.

(BEGIN VIDEO CLIP)

RICE: The Israeli prime minister has always said that when he had a partner for peace, when he had someone who was really willing to fight terror and to remove the scourge of terror, that he would be ready to make the difficult choices that Israel must make. And I believe that we're getting to those conditions.

Again, it's a long road ahead. The president came here to start the process, but we believe we have a chance to make real progress.

(END VIDEO CLIP)

KING: Now, Condoleezza Rice voicing confidence there that, when we get to the hard part -- and that begins tomorrow -- that Prime Minister Sharon is ready to do his part.

Judy, we are told, at the summit tomorrow in Jordan, the three- way summit, Prime Minister Sharon is prepared to do just that, at least with some modest beginnings, promising to dismantle some illegal settlements. Mr. Bush wants a firm commitment from the Palestinians to crack down on terror groups. He believes he will get that tomorrow as well -- Judy.

WOODRUFF: And, John, what's this we're hearing about a new team the Bush administration wants to put together to push all this after the president leaves?

KING: One new face and one shift in strategy, we're told. Assistant Secretary of State John Wolf, who currently deals with nonproliferation issues, will be named the president's new special envoy to the Middle East and be dispatched to the region soon to sit there indefinitely, to monitor the progress.

We're also told, though, as this plays out, do not be surprised at all if we not only see Secretary of State Colin Powell traveling to region, but also National Security Adviser Condoleezza Rice. We are told that she will go at some point, when a troubleshooter is needed. As a reflection of the commitment of this president to be personally involved, he will send someone whose office is not at the State Department, but right near his in the White House -- Judy.

WOODRUFF: All right, John, so we'll be seeing more of her and also a little more of Mr. Wolf. OK, John King reporting from Sharm el-Sheikh, thanks very much.

And a program note: John's complete interview with National Security Adviser Condoleezza Rice will air tonight at 7:00 Eastern here on CNN.

Here in Washington: The next big political debate is taking shape on the issue of health care, specifically the addition of prescription drug coverage to the Medicare program.

CNN's Jon Karl reports, both parties claim to want the same thing, but there are major policy differences lurking just below the surface.

(BEGIN VIDEOTAPE)

GEORGE W. BUSH, PRESIDENT OF THE UNITED STATES: A new spirit and a new attitude.

JONATHAN KARL, CNN CONGRESSIONAL CORRESPONDENT (voice-over): For years, politicians have been elected by promising prescription drug coverage to seniors, only to deadlock on the issue in Congress. This year, both sides say, is different.

UNIDENTIFIED MALE: Look, I admit there has been a barrelful of politics on all sides on this issue. There's no question about that. But senior citizens have waited far too long for a prescription drug benefit to be put in the Medicare plan. This president and this Congress now have a responsibility to do it.

KARL: As a candidate, George W. Bush promised seniors drug coverage. As president, he is pressuring fellow Republicans to get it done. The White House recently gave Republicans this videotaped personal appeal from the president.

BUSH: My goal is to give seniors more choices and better benefits under Medicare, including a long-awaited prescription drug benefit.

KARL: The White House wants Republicans to play the video at town hall meetings back home. Under the president's plan, drug coverage would be given to all seniors. But those who opt to exchange traditional Medicare for a form of managed care from a private insurance company would get a more generous benefit.

But Democratic leaders are already signaling a tough fight against that idea, accusing Republicans of trying to force seniors to give up traditional Medicare.

SEN. TOM DASCHLE (D-SD), MINORITY LEADER: The Republican bill so far falls short. Not only that, they are coercing their seniors into accepting a private health care system in order to be eligible for any benefit at all. And we think that's wrong.

KARL: Republican Finance Chairman Chuck Grassley is working with moderate Democrats on a plan he insists will preserve traditional Medicare, but also provide a choice of private coverage.

GRASSLEY: I want choice. I want it to be universal. I want it to be comprehensive. And I want it to be voluntary.

(END VIDEOTAPE)

KARL: Now, the White House says getting seniors into some form of privately administered managed-care programs is the key to controlling costs.

But they have a problem. The nonpartisan Congressional Budget Office estimates that getting seniors into such privately administrated programs will actually cost more than traditional Medicare -- Judy.

WOODRUFF: And that could be a problem. All right, Jon Karl at the Capitol, thanks very much.

Well, health care is just one issue the Democratic presidential hopefuls are highlighting out on the campaign trail. John Kerry and Howard Dean, in particular, have tried to separate themselves from the pack, which has led to inevitable comparisons between the two candidates from New England.

Here's our senior political analyst, Bill Schneider.

(BEGIN VIDEOTAPE)

WILLIAM SCHNEIDER, CNN SR. POLITICAL ANALYST (voice-over): Democrats are angry at George W. Bush and they have long been frustrated with Al Gore. They want a leader who will stand up to President Bush and show toughness and conviction, unlike Al Gore in 2000.

Meet John Kerry, the un-Bush, and Howard Dean, the un-Gore. The New Hampshire primary is beginning to look like a contest between Kerry, from Massachusetts, and Dean, from neighboring Vermont.

DOUG HATTAWAY, DEMOCRATIC CONSULTANT: I would give Kerry a bit of an edge on the number of the seasoned hands and experienced politicians on his team. And Howard Dean seems to have a bit of an edge on youth and enthusiasm. SCHNEIDER: On Sunday, "The Washington Post" ran a profile of Senator Kerry, describing him as smart, nuanced, and complex in his thinking. Is that good?

JOHN MARTTILA, DEMOCRATIC CONSULTANT: I think the virtue of the complexity, as different facets of John's character and life history emerge, I think he will become an increasingly interesting personality.

SCHNEIDER: Smart, nuanced and complex are not words people often use to describe President Bush. If you want someone very different from Bush, the un-Bush, Kerry's your man.

Howard Dean presents himself as the Democrat who stands up to President Bush, unlike most Democrats in Washington, John Kerry, for example.

DEAN: As I have traveled around the country, that rank-and-file Democrats are almost as mad at the Democratic Party as they are at the Republicans, because they don't feel like that Democrats in Washington have stood up to the president. And I'm not that way.

SCHNEIDER: Kerry's response: Neither am I.

SEN. JOHN KERRY (D-MS), PRESIDENTIAL CANDIDATE: The one thing this country doesn't need is a second Republican Party.

SCHNEIDER: Dean's response: Now you're imitating me.

DEAN: Senator Kerry, we don't want Dean-light either.

SCHNEIDER: There's one guy both Democrats are modeling themselves after: John McCain. Kerry wants McCain's credibility on national security.

MARTTILA: Americans would trust McCain on national security issues, by virtue of what they believe to be his personal strength and personal experience. So I think, similarly, over time, people will come to trust John.

SCHNEIDER: Dean wants McCain's image of straight talk.

DEAN: I'm not a conventional politician. I don't move because I take positions for this or that way. I don't poll and then take positions. I take positions because I think they're the right thing to do for the country.

(END VIDEOTAPE)

SCHNEIDER: So, one candidate who's not like Bush, another candidate who's not another Gore, and both candidates who claim to be the new McCain, a strange choice for Democrats -- Judy.

(LAUGHTER)

WOODRUFF: All right, we're hearing a lot of names we've heard before here.

SCHNEIDER: Yes. All right.

WOODRUFF: Bill Schneider, thanks very much.

Well, now more news from Kerry, Dean and the other Democratic hopefuls in our "Campaign News Daily": Fund-raising is the theme of the day. And the candidates have left Des Moines and Manchester for more dependable sources of campaign cash. Senator Kerry, along with Howard Dean and Dick Gephardt, are all in New York City for campaign fund-raisers. Joe Lieberman plans several stops in south Florida, while Florida Senator Bob Graham is looking for donations out in California. Senator John Edwards' wife, Elizabeth, meantime, is soliciting e-mail donations to mark her husband's upcoming 50th birthday.

And, in Tennessee, Al Gore supporters are determined to give it one more try. Later this month in Nashville, a group calling itself Elect Al Gore in 2004 will hold a rally on Gore's behalf. Gore, of course, ruled out another run for the White House -- unless he changes his mind, which we don't think there is any indication he will.

Just ahead: the effort to restore a child care tax credit for low-income families. I'll talk with Senator Blanche Lincoln of Arkansas about why she is fighting to restore the proposal cut out of the recent tax cut package.

The intriguing race for Denver's mayor: Will voters favor the political outsider or the hand of experience?

And later: the Reverend Al Sharpton's new political benefactor, details on the civil rights activist's new Hollywood connection.

(COMMERCIAL BREAK)

(BEGIN VIDEO CLIP)

SEN. JOHN MCCAIN (R), ARIZONA: If I were running against Bush right now, I would be smoking something strong that is not even going to be made legal in Canada.

(END VIDEO CLIP)

(COMMERCIAL BREAK)

WOODRUFF: Moves now are under way on Capitol Hill to expand child tax credits for low-income parents. Now, those parents were left out of the $350 billion tax cut package just approved by the Congress. Senators Olympia Snowe of Maine and Blanche Lincoln of Arkansas are introducing legislation restoring the expanded child tax credit for families in the low-income bracket. The measure would cost $3.5 billion over the next decade.

Senator Lincoln is with me now from Capitol Hill.

Senator, the tax cut bill passed the Congress. The president signed it. Now you're going back in an attempt to fix it. Doesn't this make it look like Congress doesn't know what it's doing?

SEN. BLANCHE LINCOLN (D), ARKANSAS: Well, Judy, unfortunately, I was not in the room in the conference when there were just a few members and a few staffers that were finalizing the tax package.

It wasn't the normal course of events of how we're supposed to do things up here. But I think there were a lot of things that we recognized could have been done a little bit better. And this is exactly one of those. We have got an opportunity to fix it. I'm not looking for an excuse to increase by $100 billion the debt that these children are going to have to pay in the coming years.

What I'm looking for is an opportunity, I think, to correct something that was done -- or that was not done, actually, that was left on the cutting-room floor.

WOODRUFF: You must think this is really necessary, to go to all this trouble.

LINCOLN: Oh, absolutely. All you have to do is look at a state like Arkansas, where we've got 80 percent of the people of our state have an adjusted gross income of less than $50,000 and 48 percent of them have an adjusted gross income of less than $20,000.

When you look at fact that 12 million children are missing an opportunity to benefit from this tax cut that we've done -- these are families. These are working families that play by the rules. They're out there buying the new tires and the blue jeans and the tennis shoes and the washing powder and the cartons and cartons and cartons of milk. We want to give those families the opportunity to stimulate the economy, too.

WOODRUFF: Senator, two quick points.

LINCOLN: Sure.

WOODRUFF: One is, an aide to Senator, Majority Leader Bill Frist said: "If we start down this road, we're going to find other things that should be tweaked. And before you know it, you're going to see the whole tax bill thrown up in the air and we're going to have start all over again."

LINCOLN: Well, if that's the attitude, then maybe we should have taken a little more time in dealing with the tax package when we were dealing with it. I just think that maybe this isn't a priority for them. But it is a priority for me and it is a priority for the working people of this country. And 12 million children are left out.

WOODRUFF: Let me also read to you a comment today from Senator Charles Grassley, you know, chairman of the Senate Finance Committee.

LINCOLN: Right.

WOODRUFF: He is separately introducing a bill to go much farther, be more generous with the child tax credit. And here's what he said. He said, "Some of us in Congress wanted more family tax relief in this package than what we ultimately passed." He said, "Some Democratic senators who said they wanted extra family tax relief would have voted against the bill regardless."

Is this all politics, Senator?

LINCOLN: I hope not. I certainly hope we're not playing politics with our children. They're the face of this nation and the future. They're our hope. They're our future leaders and our future work force. Senator Grassley is making a valiant attempt. It's not paid for.

I'm not here -- I'm not looking for an excuse to add to the debt for these children. It's almost $100 billion that he's talking about. But I am talking about making American families a priority. We stimulated this economy -- or our attempt to stimulate this economy was to strengthen our country. And we need to look no further than the American family to do that. It's about fairness. It's about balance and giving these American families the same benefits we are everybody else in this tax bill.

WOODRUFF: Will this pass, your effort?

LINCOLN: I hope so. I am going to continue to work on it. I think it makes good sense. We pay for it with the corrections in some of the Enron accounting scandal mechanisms. So we get two birds with one stone. Not only do we help working families and those 12 million children, but we correct some of the egregious accounting methods that Enron was using.

WOODRUFF: All right, Senator Blanche Lincoln of Arkansas, who introduced today an effort to restore some language left out of the tax cut bill to help families, low-income families, with their child tax situation.

LINCOLN: Thanks.

WOODRUFF: Senator Lincoln, thank you very much.

LINCOLN: Thank you, Judy.

WOODRUFF: When we return: Voters in Denver are choosing a new mayor. Will they go with a business man who has campaigned as an outsider or an auditor who touts his experience in government?

The story just ahead.

(COMMERCIAL BREAK)

WOODRUFF: Voters in Denver are choosing a new mayor today. Two Democrats are squaring off in the nonpartisan runoff election. One of them, a political rookie, is the heavy favorite.

(BEGIN VIDEOTAPE)

UNIDENTIFIED MALE: This is John Brigham (ph) of Brigham Salt (ph). WOODRUFF (voice-over): John Hickenlooper isn't your typical candidate.

(BEGIN VIDEO CLIP, AD)

HICKENLOOPER: I was a geologist until I got laid off. I spent the last 15 years making beer, building...

(END VIDEO CLIP)

WOODRUFF: But the political rookie is on track to become Denver's next mayor. He came out on top in a seven-way election on May 6 and is heavily favored to win today's runoff.

His unorthodox campaign had him traipsing through downtown Denver feeding parking meters.

(BEGIN VIDEO CLIP, AD)

HICKENLOOPER: The city raised our parking rates and now shoppers are going elsewhere.

(END VIDEO CLIP)

WOODRUFF: Hickenlooper's zany campaign ads and good-guy charisma forced his challenger, City Auditor Don Mares, to find his groove. Mares is down in the polls, but hoping for an upset.

DON MARES (D), DENVER MAYORAL CANDIDATE: The people decide the race, not polls and not pundits. It's the people.

WOODRUFF: But the people of Denver seem to have fallen hard for John Hickenlooper.

(END VIDEOTAPE)

WOODRUFF: We'll have the results of the Denver election tomorrow right here on INSIDE POLITICS.

Well, Bob Novak joins us now with some "Inside Buzz."

And, Bob, first of all, we understand there are some Republicans increasingly concerned about the fact there haven't been weapons of mass destruction found in Iraq.

ROBERT NOVAK, CNN POLITICAL ANALYST: Absolutely.

Judy, the Democrats are trying to use that issue to undermine President Bush's credibility for the 2004 campaign. But Republicans I talk to are very concerned themselves. And they feel that there has -- that the intelligence information was exaggerated, was hyped up a little bit by the administration. This includes Senator John McCain, who has been a very strong Bush supporter on the war. And he's privately claiming he was misled a little bit. If he goes public with that, it would not be good for the president.

WOODRUFF: Separately, Bob, we hear the White House is looking for a few volunteers to go to Iraq now?

NOVAK: I love this story.

They have been asking people around town if they would spend two or three months -- these are fairly important people -- to go out there and help in the effort. One very senior lobbyist has been asked to go out there for three months. There are aides of prominent people who are going out. I think it is to try to get the Iraqi government up and running with Washington insiders. But, also, I think it's trying to make a connection between the Washington establishment and the very difficult job of running an occupation government in Iraq.

WOODRUFF: All right, finally, back in this country, the state of California, you've been doing some good reporting. What are you finding out now, that there's a better chance at the recall of Governor Davis?

NOVAK: Absolutely. I'm amazed to find it is a real thing.

There is maybe a 50/50 chance that they can get this on the ballot this fall and a much better chance, if they don't get it on in the fall, that they'll get it on next March for the primary election. If it's on the in the fall, where tomorrow will be a very small turnout, it may be all over for Gray Davis. His approval rating is in the 20s. It's about where Richard Nixon was when he resigned.

And Darrell Issa, a congressman, has put in half a million dollars out of his company into this recall campaign. I'm told he's going to put another half a million in. Gray Davis is very concerned, believe me.

WOODRUFF: Boy, would that be a story, if that recall got going, that recall effort.

All right, Bob Novak joining us from the "CROSSFIRE" set, we'll see you at 4:30.

Well, right now, we want to go to Birmingham, Alabama, where accused bomber Eric Robert Rudolph has been arraigned.

CNN's Brian Cabell is there with the very latest -- hello, Brian.

BRIAN CABELL, CNN CORRESPONDENT: Hello, Judy.

The arraignment hearing lasted only about 20 minutes. And, as expected, Eric Rudolph pled not guilty. He responded to the judge a number of times, very politely. He stood when the judge walked in. He said, "Yes, Your Honor, no, Your Honor, absolutely not, Your Honor." About five or six times, he responded.

He did not speak to his attorneys at all, as far as we could see. He sat down between his two attorneys, did not seem to acknowledge them at all. I think one of the attorneys talked to him once. But he stared intently straight ahead at the judge virtually the entire time.

A detention hearing for him has been set for next Tuesday, a week from today. At that point, they'll decide whether or not he can be set free on bond. That seems highly unlikely. Now, the trial technically has been set for August 4. That's apparently 70 days from now. That's to provide for the speedy trial provision. That's almost certainly not going to happen. Even the judge admitted that. But for technicalities purposes, they're saying August 4 the trial.

We were hearing maybe six months, maybe a year from now. But, once again, he appeared here. He sat down in a red jumpsuit. The shackles were taken off his wrists for a while. They were still on his feet. And once the hearing was over, 20 minutes later, they put him back on his wrists and he was just ushered out of the courtroom, very quiet, very serious, very thin, very intense, saying very few words, except to the judge himself. And what he said to the judge was very polite -- Judy.

WOODRUFF: All right, Brian Cabell reporting on Eric Rudolph, picked up over the weekend and already facing charges in the bombing of that clinic in Birmingham back in 1998.

More INSIDE POLITICS after this.

(COMMERCIAL BREAK)

WOODRUFF: Democratic presidential candidate Al Sharpton and five other Democratic hopefuls are getting financial help from Barbra Streisand. Sharpton's campaign manager, Frank Watkins, says the singer and actress has written a $1,000 check to the campaign. He says the donation shows that Sharpton is broadening his support base.

That's it for INSIDE POLITICS. Thanks for joining us. I'm Judy Woodruff.

TO ORDER A VIDEO OF THIS TRANSCRIPT, PLEASE CALL 800-CNN-NEWS OR USE OUR SECURE ONLINE ORDER FORM LOCATED AT www.fdch.com

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